San Diego Real Estate Blog

“The pace of descent in home price values appears to be slowing” said David M. Blitzer, chairman of the Index Committee at Standard & Poor’s. “There is a clear inflection point in the year-over-year data, due to four consecutive months of improved rates of return, after the steep decline that began in the fall of 2005. In addition to the 10-City and 20-City Composites, 17 of the 20 metro areas also saw improvement in their annual returns compared to those of April. Looking at the monthly data, 13 of the 20 metro areas reported positive returns; and the 10-City and 20-City Composites reported positive returns for the first time since the summer of 2006. To put it in perspective, these are the first time we have seen broad increases in home prices in 34 months. This could be an indication that home price declines are finally stabilizing.

“While many indicators are showing signs of life in the U.S. housing market, we should remember that on a year-over-year basis home prices are still down about 17 percent on average across all metro areas, so we likely do have a way to go before we see sustained home price appreciation,” said Blitzer.

In terms of annual declines, all metro areas and the two composites remain in negative territory, with 16 out of the 20 metro areas reporting double digit declines, the report said. Las Vegas, Los Angeles, Miami, Phoenix, Seattle and Tampa posted their lowest index levels in May since their respective peaks. From peak to trough, Phoenix and Las Vegas fared the worst, posting 54.5 percent and 53.4 percent declines, respectively. More upbeat news is seen in the monthly data; Dallas and Denver have reported three consecutive months of positive returns, the report said. Atlanta, Boston, Cleveland, San Francisco and Washington D.C. each reported two consecutive months of positive returns. Eight of the 13 MSAs reporting positive monthly returns for May were greater than 1 percent, according to the report.

C.A.R. Newsline is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 175,000 REALTORS® statewide.

Calif. median home price - June 09: $274,740 (Source: C.A.R.)
Calif. highest median home price by C.A.R. region June 09: Santa Barbara So. Coast

$850,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region June 09: High Desert

$108,600 (Source: C.A.R.)
Calif. First-time Buyer Affordability Index - First Quarter 2009: 69 percent (Source: C.A.R.)
Mortgage rates - week ending 7/23/09 30-yr. fixed: 5.2% Fees/points: 0.7% 15-yr. fixed: 4.68% Fees/points: 0.7% 1-yr. adjustable: 4.77% Fees/points: 0.6% (Source: Freddie Mac)

A new set of consumer-protection rules take effect July 30, including requiring lenders to provide consumers with initial disclosures of the estimated mortgage costs within three business days of the loan application; prohibiting lenders from collecting any fees prior to the consumer receiving the loan-cost disclosures; and prohibiting quickie closings on loans.

Traditionally, many mortgage brokers and lenders collected fees covering appraisal, credit, and other charges at the time of application.  The new rules eliminate this practice and prohibit lenders from collecting any fees until the consumer has received the truth-in-lending disclosures and an annual percentage rate (APR) calculation of the loan costs.

The new rules also require lenders to deliver a copy of the real estate appraisal to the home buyer three business days before the scheduled closing on the loan.  Previously, federal regulations guaranteed that consumers could request and obtain a copy of the appraisal, but many home buyers were not aware of this right.

Additionally, the rules prohibit quickie closings on loans by requiring a seven-day waiting period after applicants are handed their early disclosures or the disclosures are mailed.  This provides applicants a week to think about the transaction and to decide whether it is right for them.  Final truth-in-lending disclosures are due three business days before closing.

I thought I would share this article with you. I hate hearing about San Diego homowners in distress getting ripped off by scam artists. Please read the article below and call me with any questions on the foreclosure process.

Leo Gonzalez

619-709-2042

The DRE recently issued a fraud warning alerting consumers about loan modification scams and informing consumers of what they can do to protect themselves. The alert is available in both English and Spanish.  Last July, the DRE had fewer than 10 complaints involving loan modification companies; today the department has 750 pending investigations. In addition, since last October, the DRE has filed more than 200 desist and refrain orders. A list of the companies and persons the DRE has filed an action against can be viewed at http://www.dre.ca.gov/cons_drs.asp.

It is worth noting that not all firms who collect advance fees for loan modification services do so illegally, the DRE said.  In general, only licensed real estate brokers and attorneys operating within the scope of their license may collect advance fees. Real estate brokers must have their advance fee agreement reviewed by the DRE prior to its use to ensure it is compliant with real estate law.

C.A.R. advises members to carefully look at any program that may appear to have a government seal. C.A.R. is not aware of any government programs that have exclusive areas for which you have to pay to participate, and cautions all members to be on the alert for schemes seeking funds from REALTORS® or consumers with no value, or that may be misleading or unlawful.

Hello,

Median home price up in June

Hopes raised for comeback in S.D. housing market

San Diego County's median home price rose for the third consecutive month in June, hitting $314,250, the highest figure since October, and raising hopes that the region's slumping housing market may finally be poised for a comeback.

With fewer low-priced foreclosure homes on the market and growing sales of higher-priced properties, the county's median price rose $19,250 from May to June. The 6.5 percent one-month percentage gain was the biggest since MDA DataQuick began keeping records in 1988.

DataQuick attributed the jump to an increasing number of deals above $500,000, as more buyers responded to price cuts. Resales of such homes in Southern California rose to 19.6 percent of all sales in June, up from a low of 13.4 percent in January.

Andrew LePage, a DataQuick researcher, said the proportion of resale homes in San Diego County that had been foreclosed on within the previous 12 months was about 39 percent, the lowest level since May 2008.

Rick Sharga, senior vice president of the RealtyTrac real estate research firm, said three straight months of price gains is significant, even if it's too early to proclaim a recovery.

After the heady days of the housing boom, “certain markets overcorrected,” he said. “San Diego may be one of those. We may be seeing the beginnings of a turnaround.”

In its June report, DataQuick said home sales in the county totaled 3,692 last month, a 14 percent increase over May and a 20 percent increase year over year.

The median price for resale houses in June was $350,000, a 7.7 percent increase from May but a 13.6 drop from one year ago. The median for resale condos was $210,000, a 5.5 percent increase from the previous month but a 19 percent drop year over year.

The median price for new homes, including new construction and condo conversions, dropped 4.3 percent from May to $455,500. That marked a 7 percent decrease from the same month last year. The median is the midpoint of all sales, with half above and half below that amount.

Sean O'Toole, founder of ForeclosureRadar.com, said there is a growing perception among buyers that the market has reached its bottom. Marc Zimmerman, an agent with Encinitas-based Pineapplehut Inc., shares that optimism.

“There are multiple offers on almost all properties under $350,000,” he said. “If credit will loosen up, the high-end market should follow.”

Analysts say that already is happening, as buyers find it easier to secure “jumbo” loans greater than $697,500 for high-end properties.

“The jumbo market was frozen for a while,” said Brian Yui, chief executive of Houserebate.com, a San Diego real estate company. “A year ago, if you had 20 percent down and perfect credit, the interest rate was 8 or 9 percent. Today it's about 5.75 percent. Some of the higher-end homes are moving.”

But the improving market could be dealt a setback if the many homes now in the foreclosure pipeline end up being taken back by lenders. A voluntary moratorium by banks has temporarily slowed the foreclosure rate, but many borrowers remain behind on their mortgage payments.

“The banks could pull the plug at any time,” said Dave McDonald, government affairs chairman for the San Diego County chapter of the California Association of Mortgage Brokers.

“We know we are still in a deep recession,” LePage said. “We don't know when we are pulling out of it. We know more foreclosures are coming.”

Mark Goldman, a mortgage broker and San Diego State University real estate lecturer, said the recent rise in the median home price was a positive sign but not proof that the housing market is on the mend. He noted that summer is traditionally a buying season and that low interest rates have encouraged buyers.

DataQuick has yet to complete its June foreclosure report. In May, it said that some high-end neighborhoods experienced record levels of defaults. Point Loma, Solana Beach and Rancho Santa Fe and other expensive areas reported elevated numbers.

In its report for the six-county Southern California region, DataQuick yesterday said more mid-and high-end homes have begun to sell because prices are falling.

The report said home sales rose in June to the highest level in 30 months in Southern California as the number of transactions greater than $500,000 continued to rise.

The share of purchase loans above $417,000 rose to 14.8 percent in June, the highest since it was 15.6 percent last August. The median price for new and resale houses and condos in Southern California last month was $265,000, up 6.4 percent from $249,000 in May but down 26.4 percent from $360,000 in June 2008.

Even though the San Diego County market's future remains uncertain, the rise in the median price for June is a good sign, said Kelly Cunningham, an economist for the National University System Institute for Policy Research.

“More homes are selling, and not just foreclosed homes,” he said. “Activity in the housing market is a fairly strong indicator of better health in the economy. Housing is what led us into the downturn. We are looking for it to lead us out of the recession.”

Emmet Pierce: (619) 293-1372; emmet.pierce@uniontrib.com

In the Union-Tribune on Page A1

I thought I would share this article with you. Please call or e-mail me if you have any questions about the status of the current market.

Leo Gonzalez

The monthly California Building Industry Association/Hanley Wood Market Intelligence (HWMI) New Home Sales and Pricing Report showed that sales in new-home communities of 10 units or more declined 26 percent compared with May 2008, but sales improved from the 31 percent decline in the prior month and is the fourth consecutive month of that improvement trend.

During May, 3,019 new homes and condominiums were sold in the subdivisions tracked by HWMI, compared with 4,094 in May 2008. Sales of single-family homes were down by 30 percent, while sales of townhomes and “plexes” – duplexes, triplexes, etc. – were down 24 percent and sales of condominiums were off by 16 percent.

Compared with the same period last year, the median base price of homes sold dropped by 5 percent.

“The incremental gains since March are counter to this typical seasonal trend, which suggests the market has found the bottom and is truly stabilizing, albeit slowly,” said Jonathan Dienhart, Director of Published Research for HWMI.   “With the state tax credits for home purchases running out and continued troubles in the broader economy, it is not yet clear that an actual recovery is at hand.

C.A.R. Newsline is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 175,000 REALTORS® statewide.

Hello,

I received this e-mail today from our Senator Barabara Boxer and thought I would share this information with all of my clients since many of your families have a long history in the military. It sounds like in interesting project.  I hope you find this interesting. Feel free to pass on the information to any veterans.

All the Best,

Leo Gonzalez

619-709-2042

Dear Friend:

In 2000, legislation was passed to create the Veterans History Project.  It was intended to tap into and preserve the rich personal histories of our veterans with oral and written histories, preserved by the Library of Congress.

The Veterans History Project is a history project for all veterans and all veterans are encouraged to lend their voices and their stories.   The web feature at the Library of Congress for the Veterans History Project is at http://www.loc.gov/vets/

First-hand accounts of US veterans who served in World War I, World War II, the Korean War, Vietnam War, Persian Gulf War (1990-1995), and the Afghanistan and Iraq conflicts (2001-present) are included, as well as civilians who actively supported the war efforts, including war industry workers, USO volunteers, flight instructors, medical volunteers, and defense contractors, as examples.

Video and audio tape is accepted, as well as original narratives and memoirs, wartime diaries and journals, collections of letters, official military documents and collections of original photos or artwork.  If you are interested in participating, you can access the Veterans History Project Field Kit at http://www.loc.gov/vets/kit.html

Another important way to participate is to listen and view the collection of the Veterans History Project.  Recordings are available at http://lcweb2.loc.gov/diglib/vhp/html/search/search.html  For educators, a special guide is available at http://www.loc.gov/vets/youth-resources.html

Our veterans share amazing stories of heroism, bravery and fidelity.  This project makes it possible for each of us to hear the actual voice of veterans telling these stories.  If you are a veteran with a story, a person who can help to interview a veteran, or if you just want to hear these stories, I encourage to you to participate.

Sincerely,

Barbara Boxer
United States Senator

Hello San Diego,

Just as I said foreclosures will surge towards the end of the year. I thought I would share this article that re-affirmed my analysis of the market. Please call me if you would like me to complete a comparative market analysis on your San Diego home.

-Leo Gonzalez

WASHINGTON ---Just as the nation's housing market has begun showing signs of stabilizing, another wave of foreclosures is poised to strike, possibly as early as this summer, inflicting new punishment on families, communities and the still-troubled national economy.

Amid rising unemployment and falling home prices, mortgage loan defaults have surged to record levels this year. Until recently, many banks have put off launching foreclosure action on many troubled properties, in part because they had signed up for the home-stability plan from Preseident Barack Obamas administration, which required them to consider the alternative of modifying loans to make it easier for borrowers to make payments.

But with many government and self-imposed foreclosure moratoriums expiring, the biggest lenders indicate they are likely to move more aggressively to clear a backlog of troubled mortgages.

Home sales have been steadying nationally, thanks largely to an abundance of cheap foreclosed properties, government incentives and record low mortgage rates. Housing construction starts have flattened out, helping to bring supply into balance with demand. The rate of housing price declines has slowed as well, even turning up again in some communities.

July 6, 2009

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Home sales increased 35.2 percent in May in California compared with the same period a year ago, while the median price of an existing home declined 30.4 percent, C.A.R. reported last week. “With affordability for first-time buyers at a record high, sales of existing, single-family homes continued to remain above the 500,000 level for the ninth consecutive month,” said C.A.R. President James Liptak. “Buyers are beginning to realize that the combination of favorable home prices, historically low mortgage rates, and first-time home buyer tax credits, may not align again for many years.

“The sales gains over last year have diminished in recent months,” he added. “This trend is expected to continue through the end of the year, as limited inventory at the moderate and low end of the market constrains sales activity,” he said.

Closed escrow sales of existing, single-family detached homes in California totaled 556,590 in May at a seasonally adjusted annualized rate. Statewide home resale activity increased 35.2 percent from the revised 411,770 sales pace recorded in May 2008. Sales in May 2009 increased 2.9 percent compared with the previous month.

The median price of an existing, single-family detached home in California during May 2009 was $267,570, a 30.4 percent decrease from the revised $384,540 median for May 2008, C.A.R. reported. The May 2009 median price rose 4.2 percent compared with April’s $256,700 median price.

C.A.R. Newsline is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 175,000 REALTORS® statewide