HOUSING REFORM-2009 Panacea or Panic?

The news is full of housing reform stores but the shelf life for reform legislation seems shorter than that of freshly baked bread—what made the news just yesterday is often obsolete by today.Congress

We expect 2009 to be a turbulent time in real estate. Knowing how to weather the storm is paramount to the survival of homeownership.

Key Elements

President Obama signed a $787 billion stimulus bill which includes many features to protect homeownership.

These are a few of the incentives targeted to help 4-5 million responsible homeowners stay in their homes:

\\· Provide access to low cost refinancing where borrowers who have less than the required 80% loan-to-value could refinance to lower their monthly payment.

· Seventy-five billion will be spent on homeowner stability initiatives to help struggling homeowners who, because of the recession, are hard pressed to make their mortgage payments and cannot afford to sell or refinance their home due to a drop in value.

· No aide to speculators. The initiative has no provision for assisting investors or speculators.

· Provide support for homeowners who are at imminent risk of default before they miss a payment.

· Provide loan modifications to bring monthly payments to sustainable levels.

· â€Pay For Success”—Initiative for loan servicers to receive $1,000 per month each month a borrow stays current on their loan.

· â€œHelp Borrowers Stay Current”—Provides a $1,000 per month reduction in a home owners’ principle loan balance for five years if the borrower keeps their payments current.

· â€œReaching Borrowers Early”—An incentive of $500 to loan servicers and $1,500 to mortgage holders if they modify at-risk loans before the borrow falls behind.

· â€œHome Price Decline Reserve Payments”—Holders of mortgages modified under the program would be eligible for an additional insurance payment (from a newly formed entity under the Treasury Department) on each modified loan to offset declines in the home price index.

There are quite a few more initiatives to help homeowners. Though many do not apply to the majority of the loans on the Peninsula since they are not held by Fannie Mae or Freddie Mac.

Lenders Are Worried.

Recently, many lenders have been modifying loans without incentives just to keep their head above water. However in contrast to the President's incentive plans, many banks require the homeowner to be months behind in payments before any relief is possible.

â–ºIf your mortgage is scheduled for an interest rate increase which you feel you may not be able to afford, we encourage you to contact your mortgage holder immediately and see if they will modify your  existing loan. It’s in everybody's best interest if homeowners can continue to make their monthly payments, even if it takes a loan modification to make it happen.

 

Belmont’s Beautiful Mountain Blog Revisited

 

In 2008 we began several new series on our blog site. Most of our content centered around the turbulent real estate market on the Peninsula, but we also endeavored to comment about the market in general and small town happenings in Belmont.

Some of our posts simply required too much time away from the business of selling homes, and we’ve decided to eliminate a few of those.

What we will be discontinuing is the weekly update of new listings and sales. Rather, we encourage you now to subscribe to our automated system for getting listing alerts in real time—including new listings and recent sales; we just felt that we were being a little redundant and this trade-off will allow us more time to concentrate on our business.

You can still count on getting a monthly wrap-up of homes that have sold. We feature Belmont home sales in detail on this blog site and you can always get surrounding cities and the entire San Mateo county stats at our MorganHomes.com web site under “How’s the Market”; we also implemented the Fusion style graphs that are more interactive and interesting.

We’ll continue to add occasional posts in our series “Frequently Unasked Questions” Unasked3 whenever we stumble across an issue we think you should know about, and probably don’t.

 

The Podcasts we began in 2008 will still be around when we want to discuss the market in general and we hope that you continue to stay tuned to those.Podcast

We think this more focused and succinct blog format will help our readers get the real estate information they want, and know that they can rely on our regular posts whicht have attracted the most readership.

Thanks for being patient as we enjoy an exciting 2009.

Real Estate re-cap–2008

Before we wrote this year’s forecast, we went back and re-read our assessment of where the market might be headed in 2008. Graphs

 

Of course very few people could have predicted that the dire real estate woes would drag the entire economy to the brink of collapse and we were no better than most.

 

However, for your enjoyment we’ve clipped a segment out of our 2008 market forecast made on January 4th 2008—and highlighted some of our more interesting comments:

 

“This is precisely why the Peninsula should fare better than other areas [in 2008]”.

 â€œHowever, it’s entirely possible we are on a precipice which could collapse at any time. What is [currently] impacting the Peninsula is the rising cost of energy—especially gasoline.”

“What could have an incalculable impact would be a prolonged recession and loss of local jobs; either of these would undoubtedly bring a decrease in home values to the Peninsula”.

In 2008, Investors eventually began to snap up undervalued properties in the central valley and a few of the nine bay area counties which were hard hit by foreclosures. This had the desired effect of liquidating the tidal wave of inventory but the undesirable effect of sinking the reported median price by skewing the sales mix to smaller homes (since smaller homes and distressed properties sell for less). The media meanwhile continued its relentless reporting of the falling median home price without appreciable application of responsible journalism. Bombarded by the media’s lack of analysis, invariably many buyers were frightened by the reports of falling home values and quite reasonably and expectedly took a “wait and see” attitude. That’s not to say the media’s information was wrong, but they do choose what to report and what to leave out and in many cases they reported numbers without the necessary perspective leading many to believe the housing situation to be far worse than it was in some areas, and far better than it was in others.

Although clearly there were several other factors which inhibited the ability of people to purchase homes—not the least of which was tighter lending standards and higher interest rates—our intrinsic evidence suggests that most credit worthy buyers on the Peninsula withheld from purchasing a home based on the fear of values spiraling down, not because they wanted to wait and “time the absolute market bottom” or couldn't get a loan.

 

Market Update-11.24.2008

Drew & Christine Morgan



 


Housing Update–November 2008

(650) 508-1441


dmorgan@morganhomes.com


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San Mateo County continues to out performed many of the nine bay area counties but a protracted deep recession could change all that.


Join us for our Podcast series now available at BeautifulMountainBlog.org


 












 


We’re very excited to bring you a new animated version of our graphs depicting the various housing market trends in San Mateo County and the cities which lie within.


Each month we download data from our Multiple Listing Service and analyze the market indicators. We provide this in-depth analysis for several of the many cities we serve on the Peninsula.


We’ve also added short audio tags to describe what we are depicting and help put the information in perspective.


Another feature will be our “Weekly Graph”. We’re not saying it will change each week but when an interesting trend develops you’ll find it under that tab.


We hope you’ll take a moment to check out our new graphical interface on our “How’s the Market?” link and give us some feedback.













Belmont Week in Review–November 1, 2008

Driving  This is an abbreviated version of our recap for the last week’s activity in Belmont because it’s been a busy week and I’m beat. That and not much transpired in Belmont real estate.

30 year mortgage rates on jumbo loans underwent a huge increase as money previously available to Fanny and Freddie Mac became more expensive.

And if you’re shopping for a home right now don’t forget, lenders are not taking applications for loans qualifying for the $729,750 conforming rate cap after December 1, 2008 of THIS year. Better lock down a home if you want favorable rates before then. Here’s an article we did that discussed the housing reform bill’s elements that apply to our market which explains the cost of getting non-conforming loan instead.

How’s this for a slow time of year—there were NO new listings last week—a first as I can remember.

One home went into pending status—our listing at 2825 Hallmark Drive. No we can’t tell you what it sold for until it closes—scheduled for December 16th 2008.

SOLD

These four homes closed escrow last week:

↓2105 Cipriani 4 Bed 3.5 Bath 2320 Square foot home LISTED for $ 1,199,000, lowered to $1,159,000 and SOLD for $1,057,500 two weeks after it was lowered.

↓80 Edgewood Place—3 Bed 2.5 Bath 2,030 ATTACHED home LISTED for $998,000 and SOLD for $970,000 in 25 Days.

↔512 Alameda de las Pulgas—2 Bed 1 Bath 1,230 Sq. Ft. home LISTED for $804,000 and SOLD for $804,000 in 37 days. This home needed a LOT of work but it was on a 9,375 Sq. Ft. lot.

↑1980 Alden Street—3 Bed 1 Bath 1,260 Sq. Ft. home LISTED for $799,000 and SOLD for $815,000 in 18 days with two offers.

This information is for entertainment purposes only and includes no legal, accounting or real estate advice nor is this intended to be specific to your situation-always consult a specialist who is familiar with the details of your situation. Homes sold do not necessarily represent homes sold by Drew & Christine Morgan.

Belmont’s Beautiful Weather

It was really neat to meet our Belmont neighbors at our open house on Hallmark Drive yesterday–thanks to all who stopped by. We had an amazing turn-out and the weather couldn’t have been more cooperative. Incidentally we did a survey at the open house where we asked our guests if they thought the home was a good value. Overwhelming, but not the least bit surprisingly, potential buyers gave lower scores for value than homeowners in the area–propagating the theory that sellers always view their home as worth more than a potential buyer.

The many nice compliments on our blog and web page were also appreciated. I had no idea so many of you read our blog and it inspires me to keep it up. Feel free to comment on anything you read too because it gives me a sense that there’s a real-time audience out there.

So the story of the day is about the last of the nice weather for awhile. We had an unusually warm October with 70+ degree evenings ‘til midnight. For those of you new to Belmont, September and October are getting to be our best months of the year. I say getting to be because my anecdotal evidence is my memory going back 40 years when I distinctly remember September being rather cool and October downright cold.

This graph looks at what is referred to as “Cooling Degree Days”. Cooling degree-days are used to estimate the amount of heat that must be removed (through air-conditioning) to keep a structure comfortable. Heating and cooling degree-days are based on departures from a base temperature, typically 65ºF (18ºC).

One cooling degree–day is the amount of cooling required to keep a structure at 65ºF when the outside temperature remains one degree above the 65ºF threshold for 24 hours. One cooling degree–day is also the amount of cooling required to keep that structure at 65ºF when the temperature remains 24ºF above that 65º threshold for 1 hour.

So the bottom line is the more cooling degree days the warmer the month. Don’t forget when we have extreme weather storms this winter you can go to our live weather station located in Hallmark for current rain rate, or frost conditions.

 

Belmont Week in Review–Week Ending October 25th 2008

The media continues its relentless barrage of horror stories and down at ground zero people continue to go on with their lives buying and selling homes to fit a lifestyle, not a portfolio.

There are currently 56 Active listings for sale in Belmont down from 58 last week. The six new listings are typical for the last big push before the holidays and the seven homes that went into contract demonstrate the desire to nest before the winter.

NEW LISTINGS

Six new listing hit the market this last week and one of them was ours—we’ll dispense with that one first:

2824 Ext 500 sh  2824 Hallmark Drive, 4 Bed 3 Bath, 2430 Sq. Ft. home LISTED for $1,298,900. Admittedly we are biased about this home not only because it’s our own listing but because we are also neighbors. Hallmark can be a busy street during commute hours but this home backs up to 300+/- acres of the Belmont Canyon open space with hiking and biking trails right out its back door. The orientation of the home is to the rear (as with most Belmont Height's homes) and you can’t get a more relaxing and tranquil setting. What truly makes this home unique is the level rear yard AND awesome canyon (and peek-a-boo) Bay Views. LIsted by Drew & Christine Morgan

OPEN SUNDAY 10/26 from 1:30-4:30 stop by and say hi, Christine and I will be hosting the open house. Here's a cool video tour if you want to get an early glimpse…

2835 Alhambra Drive 4 Bed 2.5 Bath 2,710 Sq. Ft. home LISTED for $1,348,000.

This is the second home to have been listed in as many weeks. Alhambra is a great seclude dead-end street in the Belmont Canyon. This home has seen its share of turn over as we’ve seen it sell several times. This time though it has been updated and shows very well. There’s no level yard out back but it’s a neat home. OPEN SATURDAY & SUNDAY 10/25-26 1:00-4:00. Listed By Philip Watson, Prudential California Realty

3416 Beresford 4 Bed 2.5 Bath 1,810 Sq. Ft. home LISTED for $949,915. Another nice Bay view home and with it, a yard two stories below. OPEN SUNDAY 10/26 1:00-4:30

Listed By Jimmy Chen, Out of Area Office

2949 Monte Cresta 4 Bed 2 Bath 1,670 Sq. Ft. home LISTED for $899,000. Too new to review but it’s open Sunday 10/26 from 1:00-4:00 Listed By Katrin Kaukull, Century 21 Alliance

3901 Christian 3 Bed 2 Bath 1,660 Sq. Ft. home LISTED for $868,000. This is a home where a thousand pictures isn’t worth one word—bad location. Nice home, but bad location. It’s the end home next to Ralston Ave. and every single homeowner and their cars must drive by this home to get in and out of this enclave. OPEN SUNDAY 10/26 1:30-4:30 Listed By Ron J. Bonhagen Sr., Intero Real Estate Services

3414 Beresford 2 Bed 1 Bath 890 Sq. Ft. home LISTED for $649,000. This is a contractor’s special so don’t think you’re getting any real deal here. Be prepared, but if you want a good project it’s OPEN SUNDAY 10/26 from 2:00-4:00. Listed By Rosa De La Rosa, Regency Prime Properties Inc

PENDING SALES

Seven homes went pending last week which is a good sign of overall activity in Belmont’s housing market—more than half were over a million dollars.

SOLD

Monroe â†“ 2037 Monroe 5 Bed 4+ Bath 2436 Sq. Ft. LISTED for $1,199,000 SOLD for $1,167,000 in 68 Days—19 after it was reduced.

This was a very nice home but it was on a smaller lot (4,000 +/-Sq. Ft.). It was remodeled nicely and had Belmont Country Club Canyon views. It was originally listed for $1,279,000 back in August. In September it was lowered to $1,199,000 where it finally received an offer a month after being reduced.

Square footage and/or acreage information contained herein has been received from seller, existing reports, appraisals, public records and/or other sources deemed reliable. However, neither seller nor listing agent has verified this information. If this information is important to buyer in determining whether to buy or the purchase price, buyer should conduct buyer’s own investigation. Information deemed reliable but not guaratneed.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario. These homes were not necessarily listed or sold by Drew & Christine Morgan.

Belmont Housing Activity–Week Ending September 12th 2008

It was a busy week for Belmont real estate which was expected now that summer vacations are over and agents get back to work like everybody else.

Out of the gate there were seven new listings, two re-lists, seven pending sales and three homes closed escrow bringing the inventory of single family homes for sale to 47—just like last week.

NEW LISTINGS

Tahoe 1132 Tahoe 3 Bed 2 Bath 1,610 Sq Ft. listed for $899,000. This home was purchased in June of 2006 for $900,000 and it was a major dump back then. The new owner has done a lot to the home and although it’s not quite finished, it’s pretty nice—especially for $899,000. Put this one on your short list if you’re out this weekend.

925 Waltermire 3 bed 1 bath 1,120 Sq Ft home for $749,000. If you don’t mind living next door to Safeway this home could be for you. Better yet you can run a business out of it since it’s zoned commercial according to the listing agent.

Hillcrest 3410 Hillcrest Dr. 3 Bed 2 Bath 1,640 sq. ft. home for $849,000 is even better yet. It’s in great shape with a level yard. The street is busier than Tahoe but it costs a lot less too. Move-in condition and our BEST DEAL OF THE WEEK.

2827 San Juan 3 Bed 3 Bath 2,380 Sq. Ft. home for $630,500—no—that’s not a typo.  It’s an REO and there are no showings until 9/17 but drive by and you’ll want to at least take a peak. In its prime I used to drive by this house on my way home with it all lit up and wish I could see inside. It looks like a grand old southern estate on the hill. OK, there won’t be a big level yard and who knows how bad it is inside…yet. We’d make that the Best Deal of the Week except that it could need more work than even we anticipate. Sorry—no picture available.

1908 Valdez 3 Bed 2 Bath 1,290 Sq. Ft. Home for $ 939,000 is no steal. I’ll bet that one will be around for Thanksgiving turkey.

2606 Carlmont 4 Bed 2.5 Bath 2,268 Sq. Ft. home for $1,068,000. What can we say? Those homes are in a nice canyon and all seem to be selling around this price. They’re technically attached though only conjoined by the garage (a small zoning concession to the city). Great square footage at a reasonable price and only 13 years old.

2012 Monroe 3 Bed 2 Bath 1,830 Sq. Ft. home for $942,000 was going to be our BEST DEAL of the week but some savvy buyer snapped it up one day one. Very nice indeed.

1726 Terrace 4 Bed 2 Bath 1,710 Sq. Ft. home RELISTED for $1,099,000 from $1,299,000 in April. In Belmont most homes fall into two categories with the exception to the rule being ones with level yards. They are either cliff hangers (down slope homes) where you need a bungee cord to get to the rear yard or Cliff Clingers (upslope lots) where the side of a hill is your rear yard retreat. This home falls in between with some useable yard. Don’t get me wrong, I’m not beating up on hillside homes—they can have amazing views.

2016 Lyon 3 Bed 2.5 Bath 1,781 Sq. Ft. home RELISTED at $959,000 (old price $964,500).

►If you want to see any of these homes don’t forget about our Buyer Incentive Rebate program for first time buyers to help you close the deal.

SALES

STEAL OF THE WEEK goes to:

Sommerset ↓2581 Somerset 3 Bed 2.5 Bath 2,210 Sq. Ft. home in Hallmark Area never hit the market and sold WAAAY under what it should have for $1,040,000. To put this in perspective, the last two models like this home sold this year for $1,400,000 and $1,300,000 and there wasn’t a heck of a lot of difference.

↓2613 Coronet 2 Bed 1 Bath ONLY 910 Sq. Ft. listed for $763,800 and SOLD for $758,000 great home but TINY!

↑1134 North Court 3 Bed 2 Bath LISTED for $749,000 SOLD for $810,000. It sold for $ 951,000 back in 2005.

The Streets Around Us-Sharon Road

EXCERPTED FROM OUR MORGAN REPORT NEWSLETTER:

In our last newsletter issue we mentioned how some of Belmont’s streets got their names and we were coxed to include some more in this edition. We also included a teaser about Belmont’s first and only golf course so we’ll dispense with that first. Unfortunately for golf fans, the course is not some well kept secret—in fact it has been gone for years.

Around 1925 the team of Lyon, Monroe and Miller had a grand scheme to create an 18 hole golf course adjacent a tony club house complete with swimming yank, tennis and handball courts and a children;s wading pool that would be the envy of the Peninsula.

The clubhouse would be called Belle Monte, and cost $65,000 to complete. An innovative tactic was employed to attract would-be buyers and included free bus rides from San Francisco where prospective buyers were plied with beer and induced to buy a lot. Membership for the club cost $100 but was included with every home sale on the very streets that bore their names.

Around 1929 the Belle Monti project fell on financial hard times and an attempt to salvage the operation was launched by opening the club to the public. But in 1929 the stock market crash forced members to either drop out or move away and the corporation went bankrupt. The “Hillcrest” golf course was eventually subdivided into lots for the WWII returning veterans and today we find only remnants of a bye-gone era with street names such as Fairway and a few stately homes (now on Belmont’s historic registry) which lay on what was once the perimeter of the golf course.

On the topic of streets, did you know Senator William Sharon was a U.S. Senator from Nevada, who has a small street, Sharon Road, named after himself in Belmont? Find out why Belmont had a lake named after him too in our next issue or visit our web site at local Belmont blog at BeautifulMountinBlog.org and find out what happened to the old club house before it became what is now the Congregational Church of Belmont.

Drew and Christine Morgan are experienced REALTORS and NOTARY PUBLIC located in Belmont, CA where the own an operate MORGANHOMES, Inc.. They have been assisting buyers and sellers in their community for over 30 years. Drew and Christine have received the coveted Diamond award and ranked among the top 50 agents nationwide and the top 3 in Northern California by RE/MAX. To contact them, please call (650) 508.1441 or email info@morganhomes.com.

For all you need to know about Belmont, subscribe to this blog right here. You can also follow us on Facebook and on Twitter.

This article provides educational information and is intended for informational purposes only. It should not be considered real estate, tax, insurance, or legal advice, and it cannot replace advice tailored to your specific situation. It’s always best to seek guidance from a professional who is familiar with your scenario.

BROKER | MANAGER | NOTARY

When Not to sell Your Home

PODCAST SERIES

Podcast_mic

Real estate markets are cyclical and can last ten years as we’ve recently seen, but even within a cycle there are better times during each year in which to sell.

The short answer is the worst time is in the winter, with the best times being in the spring and fall but here’s why. Psychologically, it appears buyers are more motivated to get a home early on in the year. Writing a huge check to Uncle Sam in April could be one incentive, and fulfilling one’s New Year’s resolutions could be another—both are frequently mentioned. Whatever the reason more buyers come out in the spring and tend to pay more for a home (as a percent of asking) than any other time.

The year’s spring market started off rather unremarkable due to the uncertainty of real estate as a holding while many buyers took (and continue to take) a wait and see attitude.

This graph illustrates the favorable fall selling conditions with the seller receiving a high percentage of their asking price. Notice that in October the amount a seller receives typically bounces back up? We call this phenomenon the “fall bounce” as October sales are consummated in September/October.

That could make this fall a prime time to sell in this year’s cycle. Fall is typically another window of opportunity to sell and obtain the most money for your home and this one appears to be shaping up quite nicely. The market has been rebounding steadily since the beginning of the year, and appears it may crescendo this fall, at least for the year.

We wrote a series on our blog at BeautifulMountainBlog.org about when’s the best time to sell where we analyze the important market indicators to determine favorable selling conditions. Some of which are::

·         The month’s supply of homes for sale

·         The amount a seller received of asking

·         The days it takes to sell a home, or DOM

If you are considering moving this fall we’d be glad to answer any questions you may have about the process.

Download when_not_to_sell_a_home.mp3