Sacramento Real Estate Views

QUICK STATS! 2010 Rocklin 95765 Home Values Bumpy

Year Over Year Remains Flat…So Far

The average sales price this year in the Rocklin zip code of 95765 has remained largely flat from 2009 to 2010 year to date.  (click images to enlarge)

The second quarter of this year did show a cumulative 5% increase in values but in the third quarter so far, sales are down and so is the average sales price.

In the second quarter, I feel value increases were largely driven by the impending expiration of the first time home buyer tax credit at the state and federal level. My sense is that we’ll see value declines in Rocklin home sales going forward.

How far they go down no one can say but the economic factors, locally and on the state level, involved point to a further decline in values.

Inventory levels have increased region wide and sales have slowed.  Both are prescriptions for value losses as we’ve seen in the past.

Are you curious about the value of your home in the Rocklin or any other zip code in the Sacramento region?

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Buyers On The Sidelines…Again

Number of Single Family Homes for Sale Continues to Rise

With the threat of a double dip housing recession and no incentive for first time home buyers to purchase, the Sacramento real estate market is losing, or has lost, steam.

I know it sounds like a broken record but every month this year the number of homes for sale has gone up.

The threat of a double dip housing recession in the Sacramento region with the typical slowdown point of the “buying season” approaching is very daunting.

Depending on what the banks do, there could be more and more homes coming on the market without buyers to purchase them as investors wisely wait for the fallout yet again.

Where does our market go from here?  From the looks of it right now, not in the preferred direction.

Simple economics dictate that when supply goes up, values go down.  As you can see from the graph, supply is going up and has gone up every month this year.

Status Of Homes For Sale Remains Consistent

The status’ of the homes on the market has remained consistent since the beginning of the year, percentage wise. Looking at the fact that the notices of default keep on coming, albeit at 47% less than last year, it seems as if the foreclosures inventories should be increasing but they aren’t.

The reason for this is that many homeowners are working with their lenders to get loan modifications and some are going the short sale route.

Still, foreclosure sale after foreclosure sale is being postponed. In fact, 29% more postponements than the same time last year and 16% more postponements than last month.

I’ve heard that recovery really isn’t in the cards for our region economically until 2014.

I hope that’s wrong.  What we need right now is a huge bright spot something to get a smile on the face of the region.  A few more jobs would help.

I’m smiling anyway..regardless of what’s going on.

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Tags: homes for sale rocklin, Lincoln, Roseville, sacramento

Lincoln Homes Sales Report

July Sales Down Significantly Over June

Home sales in Lincoln, as you can see by the graph on the left, have really fallen since the end of the first time home buyer tax credit expired.

Although the tax credit was extended, it happened after the scheduled expiration of the credit and by that time, a good portion of first timers assumed they had missed out on the credit and lost the incentive to purchase.

Had the extension happened sooner than at the expiration date, it would have helped a lot more first time home to keep looking and buy homes, boosting home sales in Lincoln.

The July home sales numbers reflect that.  In June, 127 homes closed escrow while in July, the third lowest sales month of the year so far, only 78 homes sold a 38% decline in one month.

That is significant.  National housing reports reflected the same trend being the lowest selling July in 15 years.

Not good.

Average Sales Price Declines

As the graph shows, the average sales price has also declined with the lowest point being in May, the highest point in February.

While June and July indicate a slight increase over may, I don’t expect that to last.  Best case, based on what I’m seeing working with buyers in the area, the prices will stay flat.  Worst case we will see a slight decline.

That said, who really knows..not me that’s for sure.  Based on what the economists are saying about the possibility of a double dip recession and the state being in tough shape just doesn’t leave much room for optimism on values.

Regular Real Estate Transactions Rule the Roost

With all of the talk of short sales and foreclosures, regular real estate sales occupy 43% of all real estate sales in 2010.

Short sales occupy 29% and REO or bank owned homes occupy 28% of real estate sales in 2010.

Seems like all I show is short sales.  Go figure..

Looking for a home in the Lincoln?  The Mello Roos is pretty high however the average sales price for a 3 bedroom, 2.69 baths measuring 2277 square feet has averaged, in July, just over $295K.  Not a bad value that I feel will be getting better.  I’m willing to bet that the average sales price will be down in August when compared to July.

Stay tuned!

That said, if you’re looking for an agent to help you purchase a home in Lincoln, fill out the form below and we’ll get back to you promptly.

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Anatomy of a Short Sale

Real Life Example

I get a lot of questions about the short sale process and timelines in the Rocklin/Roseville housing market so I thought I dedicate this article a listing that I had that just closed.  I’ve gone through my emails to recreate the record so that you can get an idea of what the process is like.

Keep in mind that not all short sales are created equally.  The lender and investor will dictate the pace and whether or not the process is completed.  With that in mind, this is just one example of how a short sale goes.

Ok…with that, from start to finish, here goes!

Listing Date

The home in question was listed February 12th.  I gave the seller the list of required documents.  They got those together and back to me by February 15th.  The home was placed on the MLS on the 13th.

That documentation was digitized and held until we got an accepted offer on the house.  The bank scheduled an appraisal for March 1st.

Showings

The seller requested no sign in the yard and that showings be concentrated to one day when they weren’t home.  This home is in a very desirable, in demand area and got a lot of attention as soon as it went on the market.  I hosted an “open house” of sorts on the following Friday.

We had 3 offers by the following Monday.  I presented Monday evening and accepted the strongest offer.  The status was changed to “active short sale cont.” in the MLS on February 23rd.

All documentation including the listing agreement and the offer was uploaded to the bank by the 25th.

First Buyer Backs Out

April 12th – Due to family issues, the first buyer had to back out of the purchase.  The property was then opened back up for showings on the 13th.  We had received a counter offer from the bank and the approval was just days away.   This set back the seller, which was no problem for them as they were living in the home for free as all do when they are having to sell short or walking away.

That started the process over again essentially.  This particular lender didn’t allow substitutions of one offer for another so we were back to square one.

Scheduled another “open house” for the April 16th and had another offer in hand that evening.  Seller accepted and was uploaded to the bank on 19th.

Second Appraisal

My negotiator had said all along that, due to the new buyer and the reduced purchase price, that there would in all likelihood be a second appraisal.  She was right and it was scheduled and completed by May 1st.

Counter Offer From Bank

The bank counter offered the buyer at $40K above their original offer.  The buyers agent was very experienced and only went up $10K and the bank accepted.  This has happened repeatedly in my experience.  This is good for the buyers as they typically get a great discount on the home to appraised value when the bank doesn’t counter the counter.

At this point it’s relevant to know that the bank or mortgage servicer isn’t the investor on the mortgage.  Another entity actually owns the note be it Freddie Mac or Fannie Mae or a private investment concern.

The bank just wants the property off the books so they, so it seems, and they aren’t willing to stretch out the process to some extent.  It’s not their investment so who cares what it sells for.

An addendum was created changing the terms of the agreement and turned into the bank.

Approval – June 15th

In the past, it was typical for the bank to just give a verbal approval and it took forever to get something in writing.  For the most part, approval letters come and with that, the buyers lender can get to work on the loan and the transaction becomes “normal” to some extent.

Escrow is “activated”, disclosures are completed by the seller and delivered to the buyer, the buyer begins inspections and the process from here usually lasts 30 to 45 days or a normal escrow period for a single family residence.

This was the case here and the home closed 40 days later on July 26th.

Start to Finish

While there were little bumps here and there in this short sale, I kept it to the bigger events for the sake of brevity.  This one closed in 161 days.  This is normal now while in 2008 you’d be lucky to get one closed at all and in the last half of 2009 it took about 200 days to get a short sale completed.

It is possible, and is happening, to get a short sale closed in about 30 to 60 days depending on the lender.  Wells Fargo/Wachovia short sales can get done in about 30 to 45 days and don’t require the borrower to be late on their payments.  They are about as painless as it gets.

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Tags: short sale process rocklin roseville sacramento lincoln

The Short Sale Process

Stage 2

After you run the numbers and you’re convinced that keeping your home is just not a good financial decision, it’s time to get some advice from someone who has experience in short sales and can let you know about the process, what you’ll need to submit to the bank and time frames involved.

Short Sale “Specialists”

The first thing to remember, in my opinion, when picking a Realtor to help you get your home listed and sold is whether they handle the negotiations themselves or work through a professional short sale negotiator.

The banks don’t want to talk with Realtors.  Realtors are annoying and largely aren’t knowledgeable enough to get through the process without making mistakes costing everyone time.

Time is the mistake YOU DON’T want in the short sale process.  It already takes too much time as it is and making mistakes that cost time could mean the difference between getting a short sale done or being foreclosed upon.  Short sale is the better option for your financial situation than foreclosure.

(HORN TOOTING ALERT!)

I always retain the services of a professional negotiator.  My job is to price, market and get your home sold.  The banks don’t want to talk to me and frankly, I don’t want to talk to them.  I have 4 professional negotiators to choose from with experience with all major and some local banks.

Additionally, it’s easier to relate to someone who has been through similar experiences.

My family and I chose to sell our home short.  We know how tough the decision was for us and how agonizing it can be.  That said, we got past it when we realized that for the first time in years, we were in a better position than other people who were still underwater on their mortgages but not acting to change it.

In a few years, we will be able to purchase more home at a much lower price than we paid for the home we just let go.  Generally speaking, if you purchased your home from 2002 to 2009 or are over leveraged, it doesn’t pay to be a homeowner.

What The Bank Will Want To See

While a good majority of banks are now approving short sales without a financial hardship, most are still going to want to see there is some hardship that’s causing you to sell short.  Remember, this isn’t always the case especially with a Wells Fargo/Wachovia loan.

If you don’t have a hardship situation I wouldn’t let it dissuade you from trying to sell short.

To keep this article short, I’ve embedded a list of documents that we give to our clients at SellState.  Click here for a standard list of required documents.   Please understand that your lender may need more documentation than this.

This is a complete financial package with listing agreement, offer and hardship letter included that all lenders will need.

Time Frames

No one can know exactly how long a short sale will take to get completed.  Once the offer is sent to the bank, it could take 30 to 40 days or 6 months.  It really depends on the lender but the process has sped up over 2007 – 2009 time frames.

With a double dip recession in the housing sector looking imminent, they better speed up the process or risk losing additional money.

If your first buyer backs out, it could take longer.  For some people, this isn’t a bad thing provided the lender can postpone the trustee’s sale date, if the homeowner is late on their payments, extending out the time the homeowner lives for free.  Click here for an article on my recent experience with that.

Have questions about the short sale process or need a private short sale consultation?  Either call us or fill out the form below and I’ll get back to you promptly.

Thanks for visiting!  By the way..this is my 300th article!  Wow…I love blogging!

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Short Sale Comedy!

Is It Reality?

Unfortunately, it isn’t that far off.  While the short sale process has gotten quicker, it’s still brutal no matter how you slice it.  That’s why I always hire a professional negotiator to handle the banks.

They are used to it and they know exactly how to play the game.  They are worth every penny.

A friend of mine sent this video to me and it cracked me up.  Hope it does you as well.

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Tags: short sales sacramento rockin roseville

2217 15th Avenue, Sacramento

Just Listed!

I’ve just listed a fourplex in South Sacramento on 15th Ave.  I helped the seller to purchase this property last year and when he bought it, it was a mess.  2 of the units were in decent shape but the other two were in hellish shape.

He spent the money and fixed up all units and improved all systems that needed repair.

Each unit is 2 bedroom, 1 bath at an estimated 800 square feet.  The roof is in good shape and there are some minor repairs that will be completed prior to close of escrow.

The landscaping and auto sprinkler system have been repaired.

The condition here is virtually turnkey.  There will be a commercial pest/insect spray prior to close as well.

Rents

Each unit is currently rented for $650 per month.  There are no section 8 tenants.  There is also a small income coming from an onsite laundry area but this is nominal.  Each unit has a lease of varying length from 3 to 12 months.

That’s an estimated 8.44% cap rate on 25% down, 5% – 30 year fixed.

Location

The location here is good.  Very close to both Highway 99 and I-5.  In addition, it’s just across Sutterville Road from Sacramento City College and just across Freeport from William Land Park.

For more information on this listing or any other listing in the Sacramento region, please fill out the form below and we’ll get back to you promptly.

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All information is estimated.  Buyer to ascertain for themselves all questions regarding condition and investment viability.  Buyer responsibility to verify all assertions.

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