Sacramento Land(ing)

Tuesday, June 01, 2010

Sacramento Real Estate Market - June 2010 Water Cooler

Post off-topic links, observations, and stories about the Sacramento real estate market here. Please read the comment policy before posting.

51 comments:

husmanen said...: I was just thinking about local inventory, so I checked out Max’s site at Sacramento Real Estate Statistics. There is usually a Spring/Summer bounce in the number of homes for sale, but this has not occurred in our area since 2007.

We are now experiencing a rapid increase in the number of homes for sale. Here are the Sac County stats for the last few weeks:

Wk of |… #.. | Total

29May |.111| 7571
22May |….49| 7460
15May |.129| 7411
08May |.-11| 7282
01May |..-6| 7293

Could this be because:

• We have reached a bottom and houses are affordable and prices are supported by the local economy?
• Banks are starting to release inventory?
• Sellers have accepted non-bubble prices?
• HAMP didn’t work and the houses are being sold as Short sales?
• End of the Federal tax credit?
• Beginning of the CA tax credit?
• Move up buyers?
• A combination of the above or?

Whatever it is, inventory is still going up.

Ref: http://sacrealstats.blogspot.com/; Wednesday, June 02, 2010 8:32:00 AM
patient renter said...: Regarding 1, we know that they haven't. Just looking at Folsom, we're still about 25% overpriced when comparing median prices to incomes. Regarding the other items, who knows.; Wednesday, June 02, 2010 9:54:00 AM
husmanen said...: Principle reductions from BofA on the way.

http://newsroom.bankofamerica.com/index.php?s=43&item=8662

This should slow things down a bit.; Wednesday, June 02, 2010 9:43:00 PM
patient renter said...: The BoA plan:

"maximum 30 percent decrease in the loan principal balance to as low as 100 percent LTV" spread across 5 years.

I suspect the time-delayed nature of the program will be a turn off to more than a few borrowers. The maximum reduction, though generous, will turn off others.; Thursday, June 03, 2010 3:53:00 PM
patient renter said...: Spilling the beans:

http://www.calculatedriskblog.com/2010/06/fannie-mae-economist-house-price.html; Friday, June 04, 2010 1:51:00 PM
Unknown said...: Does anyone on this site have any experience or knowledge of buying a Fannie Mae Homepath property? I know that the first 15 days are for owner-occupied buyers only.

Does anyone know if the bidding process is any different for these homes? Do they take the first offer that comes in at asking price? What happens if I come in below asking price, does the listing agent negotiate?

There is a property that Fannie has taken possession of that I'm I'd like to buy. Its a fixer, and according to the listing agent, Fannie has apparently been trying to fix up homes to get max value for them. Would they listen to an all-cash offer that would save them the trouble of fixing it? Because something tells me I won't like the half-ass job their contractors will do.; Friday, June 04, 2010 9:53:00 PM
husmanen said...: So, I just heard the argument that when interest rates go up then shadow inventory will be released, thus keeping home prices stable.

I think one is controllable (interest rates) and the other is not (supply) due to the number of actors involved - many banks.

The incentive for the banks to retain the homes or delay the process would have to change, which it could. But the reaction would be hard to control, the market would only need a few to break the rules and it would be a race to the liquidate.

Any thoughts from the gallery?; Tuesday, June 08, 2010 8:41:00 AM
Orlene Robinson said...: Interesting article. Visit me for more instructions on how to market your business on the internet.; Tuesday, June 08, 2010 12:07:00 PM
Unknown said...: "So, I just heard the argument that when interest rates go up then shadow inventory will be released, thus keeping home prices stable."

Doesn't this seem contradictory? If interest rates go up, affordability goes down. So if inventory spikes when affordability is lower won't that cause a faster deterioration in housing prices?; Tuesday, June 08, 2010 12:18:00 PM
husmanen said...: Oliver, yes it does seem contrary. If the monthly cost remains the same with higher interest rates that would mean the price would have to go down, if everything else is held constant.

The response was everything is not constant and more supply will be released from the banks thus driving the price higher. I don’t get that part. Increased supply will decrease prices.

But… if inflation takes off at a scary level then the prices could remain the same or even go up but in nominal terms but your salary better go up too or there won’t be any underlying support for the new prices…. and they will fall again.

I will have to think about this more, just doesn't make sense.; Tuesday, June 08, 2010 3:30:00 PM
norcaljeff said...: Louis, I talked to a lender who did Fannie Mae Home Path properties and she was a complete b_tch and gave me misinformation, so I can't give any advice as that was enough for me to walk away from the property.; Tuesday, June 08, 2010 9:28:00 PM
norcaljeff said...: Hus, I have friends at BofA. They have had a self imposed moratorium on foreclosures since early last summer and they now will finally be releasing them so that's what the ground swell of inventory is coming from lately. Expect inventory to climb as buyers who didn't jump on a property over the fed tax credit sit on the sidelines for a while.; Tuesday, June 08, 2010 9:30:00 PM
husmanen said...: norcalljeff, intresting insight - thanks for sharing.

There have been an increased number of houses coming on the market lately, some bank owned where I was not even aware of they existed and others where it was about time.

Just in the last week the number of bank owned reducing prices has increased in my areas, and SS have reduced prices but that you can take with a grain of salt.

Some SS I see dramatically reduce the price when the auction date comes around, I am guessing but they may be trying to get a potential buyer to postpone the foreclosure. Seems to work though, at least for a few months.; Tuesday, June 08, 2010 9:53:00 PM
patient renter said...: Hus - What are you using to track listings and prices?; Wednesday, June 09, 2010 9:48:00 AM
husmanen said...: PR. I track only certain areas in Folsom and EDH so I do a lot of manual work that I put in an Excel Workbook.

My sources come from about 6 different automatic email listings, craigslist and, of course MetrolistMLS. The last is the heavy data hitter as I go through and scrape the houses of interest in my areas, I do this a few times a week.

Oh, before I forget, if ZipRealty has the house in its database you can save it and it will save the data even when it goes inactive. Also, they provide the pricing history too.

I have even started a log of foreclosure homes going to auction, date, postponements, cancellations, loan amounts and bids, taxes owed etc.

This is rather new and has given me a new insight into what is happening, e.g. a good 50% of the homes I watch that have sold at auction were not delinquent on their taxes. Someone is paying the taxes, probably the banks.

I have one example of a friend currently defaulting and someone paid the taxes, because their escrow account did not have the money and it was charged as 'paid in full'. Weird and getting weirder.; Wednesday, June 09, 2010 10:22:00 AM
Roy said...: husmanen, which area in Folsom/EDH are you looking for? I am also looking for a house, Promontary/High hill prefered.; Wednesday, June 09, 2010 3:47:00 PM
husmanen said...: Roy. Don't want to spill the beans too much but I completely avoid Serrano and most gated areas. I don't think we are in direct competition.

Gated would include the Promontory, but actually the prices are out of my range there. Their HOAs are not as strict as Serrano's and the lots are large, tempting if I could find a 'deal' someday.

"High Hill", do you mean Highland Hills or Highland View? Typical rents in this area range between $2200 and $3200, not much more or less.

Here is a good site that has data and a compilation of all the CCRs for EDH:

http://www.conniebarnes.com/serrano-el-dorado-hills/el-dorado-hills-villages.html

Areas of Folsom are encompassed by the boundary lines for Vista High School.; Wednesday, June 09, 2010 8:54:00 PM
husmanen said...: Ouch! 410 CORONADO COURT, EDH

Loan:>$1,000,000
Sale at Auction: $643,000

Currently still on MLS for $765k.

Still a lot of money, but the loss of over $350k from the bank is no drop in the bucket.; Monday, June 14, 2010 2:34:00 PM
PeonInChief said...: Did you all see this:

http://www.sacbee.com/2010/06/16/2825626/shra-disputes-hud-report-says.html

I was stunned that the SHRA thinks it's okay to overpay developers who are planning to keep the properties.

I wrote about it here:

http://peoninchief.blogspot.com/2008/07/oh-why-do-i-have-to-be-right.html; Wednesday, June 16, 2010 9:36:00 AM
husmanen said...: PeonInChief. In these cases you just wish you weren't right, misunderstood the issue or were mistaken... BUT NO! AGAIN!

At least you had the foresight to write it down, good job.

It kind of reminds me of when I meet friends and family that verbally beat the heck out of me during the bubble, and most of the way down.

Some of the worst I had thrown my way were; "be a man and buy a home for your family", "sometimes you just have to do it... and not think about it so much" and my favorite "your wrong because it can't be like your data says".

Now I am quiet regarding housing, no need to gloat, but it feels good when you are right. Not rocket science, just no kool-aid. Economic affordability fundamentals have a very good track record.; Thursday, June 17, 2010 8:26:00 AM
patient renter said...: Economic affordability fundamentals have a very good track record.

Agreed. And why are we having all of these silly unimportant metrics tossed at us as evidence of a recovery when price/income is still out of whack? As you said, it's not rocket science.; Thursday, June 17, 2010 11:03:00 AM
Roy said...: Husmanen, I am not worry about you. Just want to share some info if you are looking at the same area. Yes I don't like Serrano area, lots are too small, too close to HWY 50.

Read this: http://finance.yahoo.com/tech-ticker/article/504808/House-Prices-Still-Have-Another-10%25-20%25-To-Fall%2C-Says-Gary-Shilling; Thursday, June 17, 2010 1:32:00 PM
husmanen said...: Roy, thanks for the link.

Interesting, Shilling is speaking very much on the macro level. Wish the Sacto Area was on the Case-Shilling short list.

But does what we he says apply to our area? For example, over supply, propped up demand and shadow inventory as well as low rates. Well:

* the outlying areas seem to have an oversupply – Roseville, Lincoln, Elk Grove etc
* propped up demand continues in CA but CA has exhausted 50% of the funds in one (1) month
* shadow inventory – liquidation seems to have picked up lately, not sure though
* low rates - very low but at this level we have no where to go but up and since we buy on total monthly price, prices no where but DOWN

On a macro level, house prices since the 1890s, corrected for size and inflation, have remained virtually flat. Do you wan to invest in an asset that is declining in price?

Now if inflation takes off as well as interest rates, those that have locked in at lower rates will benefit by inflation. But to have this we have to have WAGE inflation. I see pressure building, but not sure if it will break through as unemployment is so high.

As a contrarian, things are getting a little fuzzy in specific areas. I still follow the economic affordability fundamentals where rental parity is key.

Interesting times, very interesting times.; Thursday, June 17, 2010 10:18:00 PM
smf said...: Hus,

Another thought I had was this:

Our prior home was brand new, so the maintenance costs on it were very minimal.

Our new home is 20 years old. Just keeping up with required maintenance has set us back over $30K so far.

We also have a new car and an old car. Required repairs on the old car are starting to creep up.

What is going to happen when the homes built during the bubble start to require NORMAL maintenance? How many will get into trouble from the higher bills?; Friday, June 18, 2010 11:09:00 AM
RV6Flyer said...: "* low rates - very low but at this level we have no where to go but up"

You seem pretty confident about this. Seems to me we have a larger threat of deflation than inflation and should the economy double dip, government secured debt is the safest place to be. The federal government can print money to pay its obligations, thus the default risks goes away on treasury and agency debts.

If we see some austerity measures invoked in the us budget along with slow growth, I see rates staying as low as they are right now for several years to come.

BTW, according to my most recent appraisal, I made money over the prior two years. Some areas are bucking the trend.; Friday, June 18, 2010 4:09:00 PM
RV6Flyer said...: "On a macro level, house prices since the 1890s, corrected for size and inflation, have remained virtually flat."

With the cost of capital so cheap, and if home prices remain flat, why don't you try calculating interest only calculations into your rental pairty calcs?

By renting a home, you are not creating equity, thus it is most appropriate to compare PTI vs. PITI and assume the tax benefit pays for all improvements and upkeep.

What does this do for affordability? Assume a 7 year interst only at 4.25%.; Friday, June 18, 2010 4:18:00 PM
husmanen said...: RV6Flyer. About rates, it’s not only me that think rates can and will go up, many, many other do too but it’s more of a matter when.

http://www.nytimes.com/2010/04/11/business/economy/11rates.html

on the other hand…

http://www.reuters.com/article/idUSTRE6572OQ20100608

Australia just raised theirs and money flows where it gets the best return (risk included).

Then there is the inflation / deflation issue and what goes into the basket to make up the numbers. Removing housing from the equation leaves a number of items that seem to be inflating. But even with housing included the rate of inflation has started to increase.

The rates of inflation for 2009 and 2010 below:

Yr |1|2|3|4|5|6|7|8|9|10|11|12

2009
|0|.2|-.4|-.7|-1.3|-1.4|-2.1|-1.5|-0.2|1.8|2.7|-0.4

2010
|2.6|2.1|2.3|2.2|2.0

http://www.usinflationcalculator.com/inflation/historical-inflation-rates/

Even with inflation I can see rates not rising quickly, like a pressure bubble and then going quickly up, which is not good either. Seems always to be a real lag here.; Saturday, June 19, 2010 2:41:00 PM
husmanen said...: RV6Flyer. Not really understanding the interest only situation you describe.

Could you run a few numbers and scenarios and share what you get? Say three houses at $300k, $400k and $500k, with typical rents per month say $1500, $2000 and $2500. I would be curious how this works out and your explanation.

“By renting a home, you are not creating equity…” Are you saying that if you bought now in most of the Sacto area you would be creating equity with a traditional loan arrangement?

I imagine this is true as you pay off the principle each month.

Now if you stayed in your house for the duration of the loan then you could weather a 10% dip.

But if you had to move in 5 years and there is a >20% dip coupled with a 6% commission to sell puts you in a bad situation.

I do see cases of equity being created but not a general assumption for the area. Definitely there are areas that have overshot the bottom, but many others that have not.

It appears from the Max’s Sacto Real Estate Blog that inventory is really taking off in 2010. Assuming supply and demand principles this should put pressure on prices downward.; Saturday, June 19, 2010 2:44:00 PM
husmanen said...: Since my rental is in the foreclosure process I took a look at the auction data for the last week in EDH and Folsom. Although not specific to lender or my rental I can get a good feel for what is happening. Here is what I get:

….Cancel | Postponed | Sold
#...10……..| 44………......| 4
% ..17%...| 76%........| 7%

So out of a total of 58 houses on the auction blocks only 7% were sold. The chances of being postponed seem very high. I don’t know how many times postponement happens as I haven’t been tracking that metric. But anecdotally, on the specific houses I track about 80% are postponed at least one month, pretty close to the week’s data above.

Anybody have other ‘postponement’ or ‘auction’ stories to share?; Wednesday, June 23, 2010 10:32:00 AM
husmanen said...: Interesting. Today at lunch I poked around on www.usa-foreclosure.com to identify the average and median time it took in EDH and Folsom from original auciton sale date to current sale date.

By removing the outliers and those that have not gone to auction yet I get the following for the number of days since the first auction date has been set and the current auction date:

Areas | Median | Average
Folsom| …140..…| 159
EDH..…| …119…..| 92

What I cannot see are those that have been sold or reverted back to the lender, and therefore the amount of time it took.

But from the above data it looks like it takes well over three (3) months on average from the first auction date to sale (potential sale).; Wednesday, June 23, 2010 2:18:00 PM
husmanen said...: Oh noooooo!

California to offer program to trim underwater mortgages

http://www.sacbee.com/2010/06/24/2844866/california-to-offer-program-to.html

With our budget problems in CA how can this be feasible or justifiable?

I guess more signs that the market is really stabilizing....; Thursday, June 24, 2010 11:29:00 AM
Anonymous said...: I think that using the CAP rate is the easiest way to do the comparison and leave the financing/down payment variable out of the equation until the end.

For example, in Serrano(EDH) a 400k home rents for approximately $2000/mo. $2000 - taxes (400) - insurance(50) - maintenance(50) - HOA(200) - mello roos(250) = $1050/mo net operating income. This is the amount of money you have service debt as a buyer.

The CAP $1050*12=$12,600 / 400,000 is equal to 3.1%. Unless you can borrow money at less than 3.1% it is cheaper on a cash flow basis to rent. As a renter, you are essentially borrowing the 400k asset at a 3.1% rate.

I don't like the idea of counting the tax deductions because I think it distorts the decision. The laws can change at any time and even if they stay the same over the course of a 30yr mortgage the tax write-off disappears.; Friday, June 25, 2010 9:14:00 AM
husmanen said...: Sacramentia, thanks for the write up about cap rates. That is a metric I don't use often.

Let me see if I can apply it correctly to a house I a very interested in and back into a price.

Rent = $2200/month, Monthly Costs ($450 taxes, $50 insurance, $100 maintenance),

Net Operating Income = Rent - Costs ($2200-$600 or $1600/month or $18,600/yr)

Interest Rate = 0.0487% (CAP Rate)

So I have two variables (Oper Income and Interest Rate) and should be able figure out what the market value should be.

CAP Rate = Annual Net Oper Income / Cost (or Value)

CAP Rate *Cost (or Value) = Annual Net Oper Income

Cost(or Value) = Annual Net Oper Income / CAP Rate

Cost (or Value) = $18600 / 0.0487%

Cost (or Value) = $395,000

Now lets look at rental parity for the $2200/month house I am interested in using the same assumptions above and a 30 yr loan with 20% down.

Funny, I get a house worth $400k.

Back to the house I am interested in, the current asking price is over 20% more than what I calculate. No matter what I do I cannot get the value closer to the asking price.

Price reductions are probably in order.; Saturday, June 26, 2010 5:46:00 PM
RV6Flyer said...: Looks like California is rebounding nicely in the most recent Case-Shiller index release.

http://www.standardandpoors.com/servlet/BlobServer?blobheadername3=MDT-Type&blobcol=urldocumentfile&blobtable=SPComSecureDocument&blobheadervalue2=inline%3B+filename%3Ddownload.pdf&blobheadername2=Content-Disposition&blobheadervalue1=application%2Fpdf&blobkey=id&blobheadername1=content-type&blobwhere=1245215120051&blobheadervalue3=abinary%3B+charset%3DUTF-8&blobnocache=true; Tuesday, June 29, 2010 7:34:00 AM
patient renter said...: Barry Ritholtz on the second leg down in housing. Good stuff:

http://www.ritholtz.com/blog/2010/06/mauldin-a-closer-look-at-the-second-leg-down-in-housing/; Tuesday, June 29, 2010 9:50:00 AM
Anonymous said...: 18%+ yr/yr in San Francisco. That would have been nice to see here in Sacramento.; Tuesday, June 29, 2010 7:24:00 PM
husmanen said...: Wow, 18% YoY in SF, they are leading the pack by far with San Diego at 11.7% YoY and in fourth place is LA at 7.8%.

This could be a leading indicator that things are going well in CA and we will be leading the nation out of our current economic troubles and may take into account:

• SF and San Diego represent most of CA in terms of income and population.
• The CS index is a rolling average of three months the tax credit probably didn’t have much of an impact and other S&P surveys show confidence is up all over, especially consumer.
• The CA State budget seems to be in order and taxes are probably going to be decreased in the near future.
• Consumer spending is up.
• Unemployment is way down compared to historical averages.
• Home supply is dwindling and there is no foreseeable access to ‘new’/‘available’ homes
• Interest rates are high and are moving down, thus supporting continued growth in home prices.
• Credit is loose and is causing increased demand at all levels.
• Banks are back in the game and backing their own loan mortgages.
• Houses are ‘cheap’ especially compared to the top of the market.
• Affordability metrics have over shot and it more economical to buy than to rent in most areas.
• The buy now or be priced out forever feeling.

Yeah, we may see 18% in the Sacto area soon.
/Sarcasm off/; Wednesday, June 30, 2010 8:43:00 AM
husmanen said...: PR. That was a great article, nice data based on a variety of sources over time. Thanks!; Wednesday, June 30, 2010 11:12:00 AM
husmanen said...: This comment has been removed by the author.; Wednesday, June 30, 2010 11:14:00 AM
RV6Flyer said...: Just for fun, I'll play the devil's advocate:

• SF and San Diego represent most of CA in terms of income and population.

I wouldn't say their affordability metrics are that different from the rest of the state, perhaps even worse.

• The CS index is a rolling average of three months the tax credit probably didn’t have much of an impact and other S&P surveys show confidence is up all over, especially consumer.

Those are mature markets with more move up buyers than first time home buyers.

• The CA State budget seems to be in order and taxes are probably going to be decreased in the near future.

I've got nothing...

• Consumer spending is up.

Retail sales are improving and consumer confidence is at 12 month highs.

• Unemployment is way down compared to historical averages.

Unemployment has reached an inflection point.

• Home supply is dwindling and there is no foreseeable access to ‘new’/‘available’ homes

The supply is being released at a steady rate. We have been averaging around an 8 month supply which is not horrible.

• Interest rates are high and are moving down, thus supporting continued growth in home prices.

Interest rates are not heading up anytime soon, you can count on that. They may well in fact go lower. RBC is calling for sub 2% 10 year notes by next year.

• Credit is loose and is causing increased demand at all levels.

Credit is looser than it was a year ago.

• Banks are back in the game and backing their own loan mortgages.

Bank originations are up, and many regional banks are holding their own paper. Freddie and Fannie are still in the market as well.

• Houses are ‘cheap’ especially compared to the top of the market.

Perception is reality. Buying a house for half of what is was worth three years ago is a "deal" to most. There are still a lot of people who where priced out of the housing market during the last decade that are now ready to buy at these prices.

• Affordability metrics have over shot and it more economical to buy than to rent in most areas.

This is rarely ever the case in almost any period of California housing since the Great Depression.
People are still using I/O 5 year arms at 3.5% to increase affordability. Not everyone uses the ubiquitous 30 year fixed. With the steepness of the yield curve, many mortgage bankers and brokers are pushing ARMS again. With 20% down, there is a lot of creative financing to push the limits of affordability.

• The buy now or be priced out forever feeling.

At these prices and rates, we just might start to hear that kind of talk again.; Wednesday, June 30, 2010 1:56:00 PM
patient renter said...: Retail sales are improving and consumer confidence is at 12 month highs.

I'm not sure why you'd post that since it doesn't jive with the Conference Board's latest report out yesterday.

"[the Conference Board] reported that its consumer confidence index plummeted to 52.9 in June -- the lowest level since March -- from a downwardly revised 62.7 in May"

http://www.marketwatch.com/story/us-consumer-confidence-plummets-on-job-worries-2010-06-29-102500?dist=countdown

On a few of your other points:

The supply is being released at a steady rate

The steadiness of the rate seems less important than the overall amount of (hidden) supply.

Perception is reality. Buying a house for half of what is was worth three years ago is a "deal" to most.

This is so true, unfortunately. Memories are not as deep as they should be, nor common sense. The friends who tell me that now is unequivocally a good time to buy are all the ones who got burned during the bubble.

With 20% down, there is a lot of creative financing to push the limits of affordability.

Indeed, which why I mention repeatedly that affordability is the one metric that matters above all others, and according to the historical metrics, we're still not where we should be.; Wednesday, June 30, 2010 3:10:00 PM
RV6Flyer said...: "I'm not sure why you'd post that since it doesn't jive with the Conference Board's latest report out yesterday."

Sorry, I've been mired down in an audit at work and haven't been paying much attention to the news. As of Monday, before the latest report, we were at 63.4, a recent high.; Wednesday, June 30, 2010 4:58:00 PM
RV6Flyer said...: I'll see your consumer confidence and raise you a consumer sentiment.
Basic theme, single points don't make a trend. Both measures of the consumer have solid upward sloping trend lines.

"NEW YORK (Reuters) - Consumer sentiment rose in June to its highest since January 2008 while reports of job losses were down sharply from a year ago, a survey showed on Friday.

A gauge of current economic conditions also rose to its highest since January 2008, according to the Thomson Reuters/University of Michigan's Surveys of Consumers.

The final June reading on the overall index on consumer sentiment rose to 76 from 73.6 in May. The figure was above the median forecast of 75.5 among economists polled by Reuters, which was also the reading in early June.

Reports of job losses fell by half since last June, from 65 percent of respondents to 29 percent, the survey showed.

"The June 2010 survey recorded the most favorable news heard by consumers about jobs in five years," Richard Curtin, director of the surveys, said in a statement."; Wednesday, June 30, 2010 6:00:00 PM
smf said...: RV6, don't fill up on too much kool-aid.; Wednesday, June 30, 2010 9:38:00 PM
husmanen said...: Let's look at some confidence data over time...

http://www.market-harmonics.com/free-charts/sentiment/consumer_confidence.htm

Granted not the lowest but not far away and doesn't seem to be breaking any major trend lines, well maybe expectations.; Wednesday, June 30, 2010 10:29:00 PM
RV6Flyer said...: Hus - Why do you try and exagerate every statement. I said we are in a postive trend, which the charts indicate. The behaviour is what we would typically expect at this post recessionary stage. The charts display a normal reversal from an economic bottom.

Don't live in the past, look forward--like the expecations chart ;)

Sure things feel bad right now, as the present situation indicate reflects, but we will continue to chug along in a painful slow growth environment for years to come. It doesn't mean we are going backwards or sliding into the next great depression.

Remember how things felt at the end of the Carter administration? This too will pass.; Thursday, July 01, 2010 9:38:00 AM
husmanen said...: RV6Flyer. I may have misread your comment and mixed consumer confidence with sentiment, would not be the first time I have done this and will probably not be the last.

I too believe things will get better, they are already in certain areas and even in certain fields. Others not so. I am not a perma bear or perma bull, I like looking at the data and trying to understand where the data comes from and if there are ‘vested’ interests in the source and outcome.

In the data I see things that could be described as stall or plateau or even a bounce (dead cat or otherwise), but I won’t know until it has passed. I believe when it has passed there will be plenty of time for reflection and choices to be made. The quick make a decision before you have had a time to think era of the housing bubble has past. These decisions are better made on trading floors etc.

As you mentioned, painful slow growth is probably where we are headed.

On a related note, yesterday I received an email with whole slew of open positions in the area, this hasn’t occurred in a long time. Also, a VP that I previously worked with emailed me to see if I was interested in coming back, not interested but nice to see things are moving in the right direction.; Thursday, July 01, 2010 2:39:00 PM
Patrick said...: Has anyone heard of Roseville Federal Mortgage's "Equity Relief Refinance" program? It's essentially a principle-reduction program where they will purchase your loan for 90% of the Market value.

The only catch is you gotta pay $1600 up-front and wait 180 days to see if you're approved for the reduction.; Tuesday, July 06, 2010 3:03:00 PM
husmanen said...: Patrick. Sounds almost too good to be true.

How do they make money, besides the $1600 in upfront costs?

It appears they buy the note at 90% of the market value and the package up a bunch of notes for 'resale'. A new CDO being born, but this time closer to market value.

So who takes the hit in the first place when the loan is written down to 90% of current market? Could this be part of some relief fund program?

Interesting....; Tuesday, July 06, 2010 4:43:00 PM
Roy said...: Patrick, $1600 cost sounds like a scam.; Tuesday, July 06, 2010 11:11:00 PM
Sold in '05- Bought in '09 said...: Patrick,

This is almost certainly a scam. Please see the CA Attorney General's web page at:

http://ag.ca.gov/loanmod/

Non-criminal loan companies are forbidden from collecting ANY money up front. You should report this company via that website.

CD; Wednesday, July 07, 2010 7:34:00 AM

Tuesday, June 01, 2010

Sacramento Real Estate Market - June 2010 Water Cooler

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