Archive for September, 2008
Let’s Resurrect Assumable Loans
September 29th, 2008 Categories: San Diego Foreclosures, San Diego Market Trends, San Diego Real Estate
The health of the San Diego real estate market hinges not only on home buyer demand, but also the ability of buyers to secure financing. At the same time, lenders are overwhelmed with short sales and foreclosures that hurt not only their balance sheets, but tear down neighborhood values as well.
It’s become an ugly cycle that needs serious correction–and I can’t help but wonder about reviving assumable loans in our real estate markets.
Years ago, as a Texas Realtor, a good percentage of our transactions involved the buyer’s assumption of the seller’s existing loan. Some of those loans were fully assumable, while others required lender approval.
How did this work?
Let’s use a simple example: Seller Jones has an outstanding mortgage balance of $150,000 and is willing to accept a $195,000 sales price. Buyer Smith pays $45,000 plus closing fees and assumes the existing financing. Seller leaves with that amount, less closing costs. Future mortgage payments are now made by Buyer Smith.
In some cases, lenders (and sometimes the Seller) would offer secondary financing to help with the difference between asking and sales price–as long as the buyers had a cash stake in the deal. And sometimes, to help facilitate a transaction, real estate agents took part or all of their commissions as a note.
I can’t help but wonder why mortgage lenders don’t revive the assumable loan, help kick start the real estate market, and save at least a portion of their own and investors’ portfolios in the process?
In many cases, sellers have no equity. Why not allow them to offer their mortgage debt (or renegotiated debt) as assumable financing for potential buyers? Lenders might be relieved to have mortgage payments brought current–and might even require the new buyer to deposit two or three month’s payments with them as insurance against future default.
By allowing assumable financing, lenders would fare much better vis-à-vis short sales and foreclosures–and more homeowners would be able to save their credit and exit their situations with dignity. Most lenders now force homeowners to be in default with their mortgage before they will even consider a short sale or modification of terms.
It just makes sense to get the mortgage debt seamlessly transferred before it ever goes default.
And with strangled liquidity in financial markets, it makes more sense than ever to transfer debt rather than forcing buyers to secure new financing–which may or may not be available.
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5 Tips for Renting a Home in San Diego
September 22nd, 2008 Categories: Real Estate News, San Diego Communities, San Diego Real Estate
by Roberta Murphy
Great San Diego Rental
Renting a home in the San Diego area can be a real challenge–especially if you are new to the area. Most likely, you are seeking a home near employment, and may also be concerned about local schools and neighborhood safety.
Here are some tips for finding that perfect San Diego rental.
1. Whether you are searching for a San Diego home from afar, or are doing so locally, there is much you can do online and by phone. For starters, I would check out San Diego communities and neighborhoods at City-Data where you can check prices, crime statistics and area demographics
2. Generally, the safest way to locate a potential home to rent is to do so through a Realtor or licensed property management company. These professionals are in a position to check ownership and to make sure the home is not is some state of foreclosure. Use Craig’s List and classified ads at your own risk. If you do find a property to lease through one of these advertising sources, you may still want to call a San Diego Realtor and ask if he or she can volunteer to check ownership records for you (and please remember this helpful real estate professional when you decide to buy:-)
3. Before signing a lease, make sure the lessor is the owner of record. There have been many cases where crooks offer leases on vacant homes, take the deposit and rental money–and run. Additionally, you will want to make sure the home in not in some state of foreclosure in San Diego. You could end up relocating again–and sooner than you wish.
4. Once you have found your San Diego rental, you should definitely acquire rental insurance for your belongings. Fewer than half of all tenants bother doing this, and leave themselves at risk for great loss in the event of fire, flood, theft–or someone tripping over a stool in your kitchen and suing you. These policies are relatively inexpensive and are likely available through your auto insurance carrier.
5. Take photos of the interior prior to move in, and be sure to note in writing to the Lessor or leasing agent any defects to the property. This will help protect your security deposit when moving out.
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Oceanside Harbor Days are Here Again
September 16th, 2008 Categories: Oceanside, San Diego Activities, San Diego Beaches, San Diego Events
Looking for some great fun by the beach in San Diego County this weekend?
Why not head up the coast to re-discover one of California’s greatest beach towns: Oceanside–along with its famous Oceanside Harbor and its annual Harbor Days celebration. Admission is free, and the event runs from 9 a. to 6 p.m. on Saturday and Sunday (September 20 and 21).
Bring friends and family (and your camera!) to enjoy a fun-filled experience featuring arts and crafts, great
food, games, vintage pirate ships, sailing competitions and more. Sponsored by the Oceanside Chamber of Commerce, Oceanside Harbor Days provides a great opportunity to explore Oceanside, its great beaches– and experience all of its exciting new waterfront amenities.
You might also inquire about recent attractive price reductions at Oceanside Terraces as well.
For additional information, call Roberta Murphy 760-402-9101 or 877-818-8197.
You may also check out:
Fun and Food at Oceanside Beaches
Downtown Oceanside: Moving Up?
Oceanside Urban Luxury: Oceanside Terraces
San Diego Baby Boomers: The Wish List
Fun at Oceanside and San Diego Farmer’s Markets
Oceanside and San Diego a Bargain for Foreign Investors
Things to Do with Kids in Oceanside and San Diego
Oceanside and San Diego Real Estate Irresistible to Foreigners and Expats
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Homes in North County San Diego: How Affordable?
September 15th, 2008 Categories: Luxury Homes, Market Trends, Rancho Santa Fe, San Diego Real Estate
We are working with more first time San Diego home buyers than ever before. We’re also finding bargains for second home buyers, as well as beach properties for some clever investors who have been waiting in the wings
The loaded question: Which areas offer the best deals for single family homes in San Diego real estate?
The answer is as broad as the question.
There are real estate deals to be found everywhere in San Diego County.
This article, though, deals with San Diego’s highly-desired North County real estate, which covers everything from Del Mar and Rancho Santa Fe north through Solana Beach, Carmel Valley, Encinitas, Carlsbad, Oceanside–and east to San Marcos, Vista, Bonsall, Fallbrook, Escondido, Rancho Bernardo, Valley Center, Ramona, Poway, Rancho Penasquitos, and Pauma Valley.
For August, 2008 there were two real estate sales in Rancho Santa Fe, with a median sales price of $3,262,500. This may be the highest median sales price for all San Diego real estate, but Rancho Santa Fe also has one of the longest median times on market with 131 days.
Vista (92083) offers the most affordable real estate in North County San Diego with an August median price of $256,000–and one of the shorter market times at 43 days. With 18 sales in the 92083 zip code, prices there are also down 34 percent from August of last year. With these numbers, 46 percent of San Diego County households could afford to buy a home in Vista–compared to just 23 percent in August, 2007.
Other affordable markets include Escondido, where median prices have dropped between 29 (92026) and 55 (92029) percent since a year ago, depending upon zip code. In the 92029 example, only 4 percent of San Diego’s buyers could have afforded a home there in August 2007. Today, 23 pecent could lafford to buy the median priced home of $409,000.
The only city in North County San Diego to hold absolutely stable in real estate affordability year over year is Del Mar. Only 2 percent of San Diego’s population could afford to buy a home in Del Mar a year ago, and that same percentage holds steady for today. With 5 sales in August, 2008, Del Mar has a median sales price of $1,560,000.
If you would like a full summary report for North County San Diego real estate sales statistics, please feel free to email me: Roberta@SanDiegoPreviews.com or give me a call at 760-402-9101 or 877-818-8197.
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Weasels in the Chicken Coop?
September 13th, 2008 Categories: Mortgage News, Real Estate News, San Diego Foreclosures, San Diego Real Estate
As a San Diego Realtor, I am very frustrated at the number of non-responsive and phantom agents representing San Diego foreclosures, REO’s and bank-owned homes. I wonder why on earth lenders would choose such inept real estate representation to list their properties.
I also wonder about the wisdom of placing weasels as keepers of the chicken coop.
We have close friends who have moved in and out of real estate investments very profitably over the past few years—and it is/was not unusual for them to be holding several properties at once. Good friends they are, but they never took our advice about mortgage financing.
Instead, they always used some loan hack who never returned phone calls, was late on all commitments, but somehow managed to get the loan funded—several days late. According to our friends, he could “get any loan funded.”
And he did.
This hack, they tell us, has relocated from the Los Angeles area to San Diego and is now one of those non-responsive real estate phantoms who list foreclosures.
It’s deja vu all over again.
It absolutely baffles me that the very folk who helped create this real estate implosion are now being rewarded by the lenders they duped. I am amazed at the number of listing agents who are also former loan brokers–and wonder how this came to be.
And like Brian Brady and other concerned real estate professionals, I believe that separate licensing should be required of mortgage originators and real estate agents—and that banks and lenders should be vetting their foreclosure representatives more closely.
Far too often, in my opinion, these foreclosure listings are being placed with those who helped put the real estate industry into the tailspin it is today.
More and more, I believe our industry needs to tighten licensing requirements—and offer stiffer penalties for those who knowingly place clients in harm’s way. Consider the licensing requirements for selling stocks and bonds—and the SEC penalties given for misrepresentation.
Does real estate, the most significant investment in most people’s lives, deserve any less-qualified representation?
I think not.
A version of this article originally appeared in the HomeGain Real Estate Blog.
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