Oceanside Real Estate Weblog

Pending Home Sales Rise An Unexpected 5.3%

As usual the bean counters only know what happened after the harvest. If you really want to know what is going in Real Estate read Blogs such as mine, of course, SoCalHomeBlog.com or any of the numerous others that have the true pulse of the market . This is really old news. Those who are in the market have noticed a dramatic increase in activity since late spring of this year. Homes in Oceanside, Carlsbad, Encinitas, Vista and San Marcos are selling quickly with short sales and foreclosures driving the market.

“The National Association of Realtors says pending U.S. home sales rose in June in an unexpected piece of positive news for the beleaguered market.

The group’s seasonally adjusted index of pending sales for existing homes rose 5.3 percent to 89 from a downwardly revised May reading of 84.5. The index was 12 percent below year-ago levels.

Wall Street economists surveyed by Thomson/IFR had predicted the index would fall to 84.3. The index, which sunk to a record low of 83 in March, stood at 101.4 in June 2007.”

August 6, 2008 The Associated Press.

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San Diego Foreclosure Update-The Fed Bailout

I have to give credit to Ellen Kiss from Del Mar for summarizing the Fed Mortgage Bailout in terms that make it perfectly clear who the beneficiaries of this legislation really are. This is good news if you are an investor or first time buyer in the North San Diego County areas such as Carlsbad, Oceanside, Vista, and San Marcos. If you have a loan that will turn “toxic” and have qualifying income and some cash to cure the situation this is OK news, read this careful, and call me for an interpretation that applies to your situation or that of a friend. If you are a homeowner choking on debt or a job loss then “via con Dios” call me about the benefits of a short sale to avoid foreclosure.

San Diego Foreclosure Update

Last week the US Congress and President Bush bailed out Fannie Mae and Freddie Mac, the nation’s two largest mortgage finance companies which own or guarantee about $5.2 trillion of the nation’s $12 trillion in mortgages. The new housing bill gives the Treasury Department authority to lend money to Fannie Mae and Freddie Mac, or buy their stock. It is called the “Housing and Economic Recovery Act of 2008.” The Treasury Department can spend up to $800 billion.

So, how does this housing bill affect foreclosures? The bill sets aside $300 billion for troubled homeowners facing foreclosure to refinance their loans. Lenders would write down qualified mortgages to 85% of the current appraised value and qualified borrowers would get a new FHA 30-year fixed mortgage at 90% of appraised value. Borrowers would have to share 50% of all future appreciation with FHA. The loan limit for this program is $550,440 nationwide. Program is effective on October 1, 2008.

Now will this bill have an effect on foreclosures in San Diego? I do not know about you, but this provision seems pretty convoluted. Banks have to write down to 85% of the current value, and the troubled homeowner has to come up with 10% cash down-payment for the new FHA loan which is limited to $550,440. I do not think either of these two things will happen. This bill has no control over the mortgage interest rates. People are defaulting because they cannot afford the monthly mortgage payments that were initially established at low rates, but are now resetting at higher rates. I do not believe this bill will have any affect on foreclosures in San Diego.

This bill will prevent the collapse of our home mortgage financing market and allow new homeowners to obtain financing. This is good for all of you out there looking to take advantage of the falling home prices! The bill also offers a $7,500 tax credit for first time home-buyers and permanently fixes the FHA insured loan limit & Fannie and Freddie conforming loan limit to $625,500.

San Diego Weekly Foreclosure Lists

Please click on the link below to receive the latest recorded foreclosures (Notice of Defaults, Trustee Sales, & Bank Owned) for the week ending 07/28/08. The lists are searchable by zip code or city by using the find function under the edit pull down menu. If you have any questions please call me at 760-431-8724.

http://www.easyhouserewards.com/Foreclosure_List2.html

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North San Diego County Affordability Index For June 2008

HomeDexT  June 2008 Summary Report
Single-Family Detached Homes

Rancho Santa Fe (92067), Del Mar (92014), Solana Beach (92075), Carmel
Valley (92130), and Cardiff (92007) were the least affordable areas in North San
Diego County with affordability levels below five percent.

Carlsbad (92008, 92009, 92011), Rancho Bernardo (92127), Bonsall (92003),
Escondido (92029), and Encinitas (92024) reported affordability percentages
between five and nine percent.

Carlsbad (92010), Rancho Penasquitos (92129), Rancho Bernardo (92128),
Valley Center (92082), Poway (92064), Fallbrook (92028), Pala, (92059), and
San Marcos (920 had affordability percentages between 10 and 19 percent.

Ramona (92065), Oceanside (92056, 92057), Vista (92081), and Escondido
(92025) had affordability rates between 25 percent and 27 percent. Escondido
(92026, 92027), San Marcos (92069), Oceanside (92054), and Vista (92084)
reported affordability percentages between 30 percent and 39 percent.

Vista (92083) had a 50 percent affordability percentage, the highest in North County.

Prepared for the North San Diego County Association of REALTORS® by Robert Brown, Ph.D.
Department of Economics California State University, San Marcos. Inquiries may be directed to Robert Brown
rbrown@csusm.edu

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Has Oceanside Been Hit Harder Than Other North San Diego Areas?

T L tl_@****com wrote:

I found your weblog just now. I’m curious to find out if you know why Oceanside has been hit so hard by the current market downturn seemingly harder than other areas?
Thanks,
TL

Hi TL,

Oceanside is really in line with the over all county wide average median price decline. Every community is unique. Oceanside has a very diverse housing market. There are about 40 different neighborhoods or identifiable demographic areas within the city housing market.

Here are some terms use to describe some of the neighborhoods, in some cases their actual names Oceanfront, The Old Town Site Downtown, South O, Ranch Del Oro, Mesa, Fire Mountain, The Front Gate, The Back Gate, Tri -City, Cloud Nine, The Valley, The East Side, Morro Hills, Hennie Hills, Peacock Hills, Jefferies Ranch, The Calles, Oceana, and the list goes on.

Housing prices in some of these areas are holding up rather well. Oceanfront is always in demand, and fetches the highest price. It’s been dinged but not crushed. In addition, because of the the baby boomer demographics, age 55+ communities are in demand holding their value.

The areas that are getting hit the hardest are the communities that had a large volume of sales from 1998 to 2005. These areas are typically mid to entry level priced that sold between $400K and $600K. During this period Oceanside had a large inventory of homes that fit the description.

From 1998 to 2005 the housing market was white hot with prices rising at double digit rates. Instead of putting on the brakes and allowing things to cool lending institutions actually relaxed their qualifying requirements adding fuel to the buying frenzy. Buyers could get +100% adjustable rate mortgages with easy qualifying. These and other easy to get loans are known as SUB-PRIME because the don’t meet traditional down payment, credit and income requirements. Many homeowners who had equity used their homes as cash cows to pay bills, buy cars or toys. The rest is history in the making. Loans adjusted and highly leveraged homeowners found they couldn’t afford the new higher payments. They also found there was no way to refinance out of the situation since prices stopped going up. FORECLOSURE and SUB-PRIME became a global household name.

The market correction was a natural cause and effect action that has repeated itself many times throughout history. This is where opportunity historically appears for those willing and able to take advantage.

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Median Home Sale Prices. San Diego County

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San Diego County Economic Profile June 2008

Lies! Damn lies and statistics as Mark Twain once exclaimed. Now with the California Association of Realtors June 2008 Economic profile you too can be an expert when you opine about our economic future.

These statistics reveal the strength and weakness in a wide range of economic data related to the real estate market, employment and population trends in the San Diego economy.

sandiego0608.pdf

Most interesting trends are the increase in foreclosures, the decrease in median prices listed by city, the dramatic increase in sales and which segments of the market have the most activity. Please keep in mind that median price decreases are being driven by foreclosures which account for 25% of total sales mostly in the lower priced segments of the market while sales have dropped off in the upper priced segments. This shift in activity has a tendency to make median price decreases more dramatic. Investors are buying heavily into the lower priced homes. Tremendous opportunities exist in North San Diego County Coastal cities like Oceanside, Carlsbad and Encinitas.

Damn lies and statistics! As I’ve mentioned before, all of the statistics regarding unsold inventory are squewed by the number of short sales that are listed in the inventory. Most short sales are unsellable because lenders can’t or won’t meet the terms a potential buyers offer, which bloats the inventory numbers. Buyers find themselves competing with investors, multiple offers, overbids and transactions that don’t close.

More damn lies and statistics…Some areas are showing a 20% year to date decrease in median price. However, for those who are financing their purchase mortgage rates have gone up 20% in recent weeks from 5.3% to 6.3%. So keep an eye on mortgage rates. They can easily erase any savings to be had by lower prices.

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San Diego Foreclosure Update

San Diego Foreclosure Update

Foreclosures are on the rise for the first quarter of 2008 which is no surprise. But what is a surprise, home sales have continued to climb. In San Diego County, sales are up 6% from April 08 to May 08. The reason is prices are down 25% from a year ago in May 07. Prices have not been this low since September 2003. Fortunately the job growth in San Diego has remained steady and homes prices are falling to more buyer’s affordability levels.

It will be good news if this trend lasts throughout the summer and fall with lower prices and higher sales. Consumer confidence takes awhile to re-establish, but if the sales numbers continue to climb week by week and month by month, the bottom of the market may not be that far off.

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San Diego Foreclosure Lists

Please click on the link below to receive the latest recorded foreclosures (Notice of Defaults, Trustee Sales, & Bank Owned) for the two weeks ending 6/11/08. For information about Oceanside, Carlsbad, Encinitas, Vista or San Marcos the lists are searchable by zip code or city by using the find function under the edit pull down menu.

http://www.easyhouserewards.com/Foreclosure_List2.html

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Bear Stearns’ Bailout numbers are huge….really huge.

If you are like most of us the recent bail out of Bear Stearns’ was just a passing blip in the never ending river of talking head blather and hype… most of it BS… about real estate, finance and investing. However, a closer look at the magnitude of exposure Bear Stearns’ has in derivatives gives us a prospective about why the bailout was necessary. My mentor and associate Pat Kitano has a great article about this mega event and what it really means.

So with all the hype going on about real estate slumping, tanking and all that in the Oceanside Carlsbad, Vista, San Marcos and Encinitas areas some people actually believe that sellers will be paying buyers to take their property, perhaps giving them a monthly stipend, or arranging a marriage with their daughters and mowing the yard for them until 2020. REALITY CHECK…there are some great buys to be found but don’t miss the boat. According to HomeDex median prices in the North San Diego County Coastal area actually increased about 5% in April. There are homes on the market in the North San Diego County and many other economically stable areas that couldn’t be built for their current asking price. According to some, so called, authorities we are 75% through the sub-prime fiasco. So what! Prices are down, interest rates are low, inflation is rising and what better asset to own than Real Estate? Real Estate is personal shelter, tax shelter, it doesn’t evaporate like a stock can, you can live in it , rent it, insure it so if it burns to the ground it can be rebuilt and underneath is the land value. Real Estate is a tangible asset, not a piece of paper like a Bear Stearns’ derivative.

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Some Real Estate Professionals Will Do Anything For Attention

Over the years I’ve always had a picture of myself surfing on my business cards. Call me narcissistic, if you like, and maybe I am ( it’s my great hair). But it seems that I spend a lot of time at the beach. I even have a criteria that my office can be no more than four blocks from the shoreline. So it’s natural that I’ve helped a lot of surfers find homes in the North San Diego Coastal area. I do get teased sometimes for having a surfing picture on my business card but that’s ok, at least people remember it

It’s surprising how entrenched surfing is in the North County Coastal Area and the amazing popularity of living where the sun is almost always shining and there’s a cool breeze coming off the Pacific Ocean. The surfers that live and own homes in the area come from all walks of life and aren’t your typical stereo type party animal surfer dudes. They are Policemen, Firemen, Lawyers, Doctors, Teachers, Accountants, Business Owners and just about any other type of professional. They all have their surfboards ready and will be playing hookey from work the next time there’s a good south swell.

Despite the turmoil taking place in the San Diego County Real Estate market, beach neighborhoods have maintained higher values with every step closer to the sand. People from all over the world make this area their destination to visit and enjoy. And having a vacation home near the beach is very popular for the fortunate.

Welcome to OCEANSIDE.

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Sales Trends San Diego CA

Attached is an ex-script about sales trends in San Diego courtesy of the National Association of Realtors and Yahoo. There are plenty of good buys, but how long will it last? This should give some indication. If you have any questions contact your trusted real estate professional. Chances are their guess is as good as any.
For those waiting for a bottom, consider where else in the world is a better place to live than San Diego County. Also, take into consideration that almost all foreclosures, in that hot segment of the market, sell for 98% of list price. In addition, many of the coastal area foreclosures get multiple offers. So it may be time to let that pent up need for a home along the San Diego Coast express itself. There are some fantastic buys to be found in Oceanside, Carlsbad and Encinitas but you have to be ready. Like my karate Sensi used to say “the time to strike is when the opportunity presents itself”.

Matt Woolsey, Forbes.com

Apr 10th, 2008

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