Welcome to the "Z" Team!

Moves across county and state lines are falling, with the 2007-2009 recession blamed for changing Americans’ moving patterns, according to an analysis of census data through 2010. The Great Recession caused more Americans to move because they could no longer afford to remain where they were. That’s a big change in what traditionally motivates Americans to move — a bigger home or higher paying job, USA Today reports about the analysis.

Nine percent of Americans stayed local with their moves during 2007-2009 period — the highest in a decade. 

“Typically, over the last couple of decades, when Americans moved, they moved to improve their lives,” says Michael Stoll, author of the research and chairman of UCLA’s public policy department. “This is the shock: For the first time, Americans are moving for downward economic mobility. Either they lost their house or can’t afford where they’re renting currently or needed to save money.”

More than 23 percent moved for more affordable housing during the recession. Prior to the recession, that percentage stood at 20.8 percent. 

Also, prior to the recession, 41.3 percent of Americans moved in order to own a home or settle into a better neighborhood. However, during the recession, that percentage dropped to 30.4 percent. 

Source: “Americans on the Move Start Moving Down, Not Up; Setback in Upward Mobility Hits Blacks, Sun Belt Spots Hardest,” USA Today (Feb. 20, 2013)

The West coast has been one of the epicenters to the foreclosure crisis. But lately, several western states are seeing big drops in distressed properties and foreclosure starts.

Foreclosure starts in California, for example, were down 23.6 percent from July to August and decreased nearly 50 percent from one year ago, according to ForeclosureRadar, which monitors foreclosures in five Western states. In Arizona, foreclosure starts were down 16.1 percent from a year ago.

“We continue to see reports that there will be a wave of foreclosure sales after the election or at the start of the year,” says Sean O’Toole, ForeclosureRadar CEO. “The lack of foreclosure starts this month puts a nail in the coffin of this theory. There will be no wave of foreclosures for at least five months. The good news for investors and first-time buyers is that foreclosure sales have at least remained flat, continuing to provide some opportunities in the meantime.”

Source: ForeclosureRadar and “Western states see decline in foreclosure starts,” Inman News (Sept. 11, 2012)

Good news to share! Concerns over housing and the economy are subsiding, according to Fannie Mae’s National Housing Survey from February.

An improving job market is a big part of what’s behind Americans feeling more confident about the housing market and the direction of the economy, according to the survey.

“The pickup in the pace of hiring over the past few months has helped soothe consumer concerns, lifting their moods regarding their personal finances, the direction of the economy, and their views on the housing market,” says Doug Duncan, chief economist of Fannie Mae. “As a result, we’ve seen more potential for economic upside, creating a more balanced near-term outlook.”

The survey found that 28 percent of Americans expect home prices to increase over the next 12 months while 53 percent say prices will likely stay the same. Fifteen percent say they expect home prices to decline.

With low mortgage rates and falling home prices, 70 percent of those surveyed say now is a good time to purchase a home. Also, more Americans surveyed say now is a good time to sell, rising to 13 percent in February, which is the highest level in more than a year but still low by historic standards. Please share your thoughts.

Source: Fannie Mae

California median home price: January 2012: $268,280 (Source: California Association of Realtors, C.A.R.)

Highest median home price by region/county January 2012: Marin, $694,440 (Source: C.A.R.)

Lowest median home price by region/county January 2012: Tehama, $110,000 (Source: C.A.R.)

Pending Home Sales Index: January 2012: 102.4, an increase from the revised 93.1 recorded in January 2011

Traditional Housing Affordability Index: Fourth quarter 2011: 55 percent (Source: C.A.R.)

Mortgage rates: Week ending 3/1/2012 30-yr. fixed: 3.90% fees/points: 0.8% 15-yr. fixed: 3.17 fees/points: 0.8% 1-yr. adjustable: 2.72% Fees/points: 0.6% (Source: Freddie Mac)

Here’s some interesting news to share with you! California’s attorney general has requested that the Federal Housing Finance Agency suspend foreclosure sales in the state for home owners with government-backed mortgages. 

Attorney General Kamala D. Harris has requested that home owners with loans backed by Fannie Mae and Freddie Mac get a temporary reprieve from foreclosures while housing regulators conduct reviews of whether at-risk home owners are eligible to have the amount they owe on their mortgage reduced. 

Fannie Mae and Freddie Mac have stated in the past that they’re opposed to mortgage principal reductions. The FHFA, which regulates Fannie and Freddie, has said that any such program would cost taxpayers $100 billion. 

More than half a million Californians have lost their home to foreclosure since 2008. What’s more, another half a million are in foreclosure or at “imminent” risk this year. Fannie and Freddie guarantee or own more than 60 percent of mortgages in California. 

Source: “California Seeks Suspension of Foreclosures,” Associated Press (Feb. 27, 2012) and “California AG Seeks Foreclosure Suspension,” MarketWatch (Feb. 27, 2012)

We get these questions and would like to share our thoughts about this dilemma.  Some home owners who are underwater may not know their alternatives.

The “Cash for Keys” is a program that banks do for some home owners. The “new twist” you’ll be hearing more about is “Cash to Short Sale”. Lenders are figuring out that if there is anything they can do to make a deal happen, they need to do it. This apparently is what is starting to take place with people that are trying to “short sale” their homes. Instead of “Cash for Keys” to homeowners that lose their homes to foreclosure. This was not offered to home owners who were trying to short sale their home. Often the banks would basically give them a certain time to complete the short sale until they foreclosed.

Now because of tight lending practices, new buyers would take so long to qualify, it is often “too little, too late” to close escrow before foreclosure.  When that happens it seems everybody loses. The lenders lost a willing & able buyer and the seller because, now, not only did they lose their home to a foreclosure, but also because a foreclosure was now on their credit report instead of a short sale. (It may be better to have a short sale than a foreclosure on a credit report?) Plus, the buyer may or may not wait until the home came back on the market at a later date.

Other information at: www.dougandbudzeller.com or zteam4u@gmail.com

A study by the National Low Income Housing Coalition has found that for every 100 families considered “extremely low income,” there are only 30 affordable units available to rent nationwide. “Extremely low income” renters are considered those who earn less than 30 percent of the median income in the metro area which they live. 

The NLIHC has called for more affordable rentals to meet the growing demands of low-income families. It will be interesting to see what happens! Please provide comments?  

The number of extremely low income renters has grown in recent years. In 2010, the number swelled to 9.8 million — nearly a quarter of all renters nationwide.  

“What we’ve seen is a decline in the home ownership rate since 2008, and we’ve seen rent being pushed up,” pushing rent out of each for more low income people, says Sheila Crowley, NHLIHC chief executive. (For nearly a quarter of all renters nationwide)  

The problem appears to be the most evident where the largest gaps exist between the rich and poor, such as in states like Arizona, California, Florida, Michigan, Nevada and Oregon according to the study. Our “Northern California” region is near the top!

“There’s no doubt that there’s a gap, and it’s significant, and it’s getting worse,” said Becky Koepnick, an adviser to HUD Secretary Shaun Donovan. (As many of us know)

Source: “Lowest-Income Renters Left Behind in Housing Crisis,” The Wall Street Journal (Feb. 15, 2012)

Here’s the “good news” from the weekly mortgage market survey. Rates continue to hover at record lows, with the 30-year fixed-rate mortgage staying at the record low of 3.87 percent since the first week of February, Freddie Mac reports. The 30-year fixed-rate mortgage, the most popular choice among home buyers, has been below 4 percent for the past 11 weeks. 

A closer look at mortgages rates for the week ending Feb. 16: 

30-year fixed-rate mortgages: averaged 3.87 percent, with an average 0.8 point, matching last week’s average. A year ago at this time, 30-year rates averaged 5 percent. 

15-year fixed-rate mortgages: averaged 3.16 percent, with an average 0.8 point, also matching last week’s average. Last year at this time, 15-year rates averaged 4.27 percent. 

5-year adjustable-rate mortgages: averaged 2.82 percent this week, with an average 0.8 point, dropping slightly from last week’s 2.83 percent average. Last year, 5-year ARMs averaged 3.87 percent. 

Source: Freddie Mac

“Mom and pop investors” are trying to capitalize on a depressed real estate market in the hopes of one day being able to cash in. An article in USA Today highlights this new breed of small-scale investors who like to buy and hold properties, opposed to the high-dollar large investment firms that once dominated the real estate market who preferred to buy and flip their property investments. 

For “mom and pop investors,” the strategy is to buy homes at rock-bottom prices, rent the properties out to cover costs of home ownership for several years, and then one day sell the homes when prices recover. “An unprecedented number of investors are looking into this,” John Burns, CEO OF John Burns Real Estate Consulting, told USA Today. We find some buy for eventual relocation to another area for retirement.

For investors in the rental market, an 8 percent annual return is fairly normal, according to Burns. “That means that someone who buys a $100,000 property — and pays cash for it — makes $8,000 a year after expenses, including maintenance and taxes,” the USA Today article notes. 

The threats of tenant or maintenance issues may be the potential to derail that potential profit, so investors need to be careful. Many of the investors we work with are cautious and seek advice from their real estate agent, property managers or other experts. 

Source: “Mom and Pop Investors Propping Up Home-Buying Market,” USA Today (Feb. 14, 2012)

Thought these points would be of interest to home sellers and their real estate agent to coordinate? We believe, marketing a home is a mutual effort of todays home selling! 

Do you want to increase buyer traffic at an open house? Instead of just a flyer or e-mail blast announcing the event, try to give buyers more reason to come out and tour?

A recent article at RISMedia offers some of the following ideas: 

1. Host a speaker:A guest speaker, such as a general contractor or home stager, may draw more of a crowd. Potential buyers may also be looking to sell their own homes, so a stager can offer tips to spruce up a home for sale. 
2. Offer a gift: Hold a raffle, such as by raffling off a gift certificate. Plus, with a raffle, buyers will have to share their contact information with you, which you can then use to follow up. If there’s ever a price change on the house, be sure to notify them. 
3. Involve the community:Invite the neighbors to come to the open house and share their thoughts about the school system or current events in the community, the RISMedia article suggests. You’ll not only be raising awareness about your listing but also helping “to unite the community on important issues,” the article notes. Just be sure to avoid political issues, which can polarize a crowd.

 Source: “5 Ways to Increase Open House Traffic,” RISMedia (Feb. 14, 2012)