The Pride Of Ownership Is Gone In California
The Used House Salespeople report from California. “Home sales decreased 24.5 percent in March in California compared with the same period a year ago, while the median price of an existing home fell 29 percent, the C.A.R. reported. ‘The lack of available funds for loans, even for qualified buyers, continues to keep the demand side of the market thin, and enables buyers with financing (or all cash) to exert leverage over sellers,’ said said C.A.R. Chief Economist Leslie Appleton-Young.”
“C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in March 2008 was 11.6 months, compared with 7.6 months for the same period a year ago. In a separate report covering more localized statistics generated by C.A.R. and DataQuick, 4.9 percent, or 14 out of 283 cities and communities, showed an increase in their respective median home prices from a year ago.”
The Pasadena Star News. “Los Angeles County home sales plunged 37.6 percent in March compared with a year earlier and the region’s median home price fell 25.6 percent to $431,950, according to CAR.”
“Those numbers…don’t surprise Chris Vigil, a broker and licensed appraiser in Santa Fe Springs. ‘I guess it’s to be expected because of the inventory that’s on the market,’ he said. ‘It’s not a normal inventory because short sales and foreclosures are not normal.’”
“La Puente experienced the biggest local annual drop its median home price, falling from 30.9 percent in March to $328,000 from $475,000 a year earlier. Azusa was close behind with a 27.2 percent drop, bringing its median price for March to $320,000.”
The Daily Breeze. “The South Bay housing market continued its skid in March, with every local city and community cited in a new report seeing a drop in median home price.”
“Most South Bay cities cited in the report posted double-digit losses. Hawthorne’s median home price plunged 27.4 percent to $429,500 in March. Carson’s median dropped 16.6 percent to $417,000.”
“‘It hasn’t been this tough in the South Bay for a while,’ said Adolph James, a Realtor in Manhattan Beach. James said he recently took a ‘knockout listing’ in Rancho Palos Verdes off the market after about four months because the seller gave up.”
“‘The owner was getting tired of showing it,’ James said.”
“The housing market has been so slow that many South Bay cities, including Gardena and Lawndale, cannot make the 30-sale-minimum cutoff. However, these cities’ home sales are included in the regional median figures such as those for the county, South Bay or Palos Verdes Peninsula.”
The Ventura County Star. “Stoked by a rash of short sales and other distressed transactions, inventory of homes on the market has swelled as demand has sagged. Quality also has become an issue as strapped homeowners seemed to have lost that ‘pride of ownership.’”
“Properties foreclosed on within the past year accounted for 35.2 percent of the existing homes sold in Ventura County during March, according to DataQuick. ‘There’s not a lot selling, and a significant chunk of what is selling is stressed,’ said Andrew LePage, a DataQuick analyst.”
“Bargain hunters are often dismayed by what they find. Buyers hoping for a deal shouldn’t expect mint condition, said Temple Schneider, a Camarillo Realtor.”
“Some sellers have left water running or stripped out copper plumbing before they vacated, said Dale King, president of the Ventura County Coastal Association of Realtors.”
“It’s apparent that sellers aren’t rushing to install the granite counter tops and wooden floors like they were a few years ago. Among distressed properties, ‘the pride of ownership is just gone,’ said Cathy Titus, a Realtor in Ojai.”
“She’s seen homes with dishes piled high and junk scattered everywhere. In many cases, owners don’t have money to do repairs — that’s ‘very normal these days in this market,’ Titus said. ‘When people are really stressed, cleaning house is the last thing they feel like doing.’”
“Even sellers who are not in distress are having to sell their homes for not much more than trashed properties, if they’re serious about making the sale, Schneider said. She recently sold a spotless, non-distressed house for $10,000 more than the ‘completely wrecked’ house for sale next door.”
“Many homes on the market offer ‘good bang for the buck,’ King said, citing a number of detached homes in the county selling in the low $300,000s, he said. ‘When the market is hot, sellers are fixing it (homes) up because that’s the way you get attention,’ King said. ‘Now buyers are looking at price and value.’”
The Contra Costa Times. “Two auctions in the East Bay next week show that developers and builders are eager to sell off their slow-moving homes. Vista Del Mar’s neighborhoods range from 1,560 to 3,665 square feet and feature fireplaces, tile entry ways, master suites and walk-in closets. Homeowner association fees are $132 a month for the Villages only.”
“Minimum bids start at $265,000 for 1,560-square-foot homes at the Villages. The homes were priced previously from $470,990 to $836,044.”
“Jade, a 70-plus condominium development in downtown Oakland will also be auctioning off its remaining 34 homes May 4 . Minimum bids start at $259,000 for three one-bedroom, one-bath units.”
“‘It’s one of the best-selling communities in downtown Oakland, but the auction process is working better than the conventional way,’ said Ken Stevens, CEO of Accelerated Marketing Partners in Danville.. ‘Developers need to move inventory fast.’”
The Sacramento Bee. “Hurt by competition from cheaper foreclosed properties, new-home construction in California could be facing its slowest year in decades.”
“The California Building Industry Association said Friday that statewide housing starts in March fell 65 percent from a year earlier. The total of 4,713 starts made it the worst March for home building in California since month-by-month recordkeeping began in 1976, said association spokesman John Frith.”
“Association economist Alan Nevin said the number of single-family homes built this year could be as low as 40,000. That would be the lowest since the association began keeping annual records in 1961.”
“Nevin said the construction slump is being worsened by the flood of repossessed homes that lenders are unloading at steep discounts. About half the home sales in the Sacramento area this year are repossessed properties, and the median sale price in Sacramento County of all homes has fallen 36 percent since the 2005 peak.”
“‘We have a tsunami of foreclosures coming this quarter,’ Nevin said. Faced with low-price competition from the banks, home builders are choosing not to build, Nevin said. ‘The builders would rather sit with the land than give it away,’ he said.”
The Press Enterprise. “Home construction has skidded to a near-standstill in Inland Southern California, with the number of new homes started in the first three months of 2008 dropping 59 percent in Riverside County and 64 percent in San Bernardino County compared to the same period a year earlier, a building consultant said Friday.”
“‘It is not a housing recession anymore. It is a housing depression and the Inland Empire is the epicenter,’ said Steve Johnson, director of MetroStudy.”
“The building slowdown reflects the industry’s efforts to adjust to shrunken demand and to clear a glut of completed but unsold homes before launching new projects.”
“The biggest obstacle builders face is tighter lending qualifications for buyers, he said. In addition, people hesitate to buy for fear that home prices may continue to fall or they will be harmed by the region’s softening economy, Johnson said.”
“‘It is a big purchase decision and nobody wants to buy at the wrong time,’ he said.”
“Borre Winckel, executive director of the Riverside County Chapter of the Building Industry Association, said it has been difficult for the industry to predict when the housing market will reach a bottom. One reason, he said, is that international forces are influencing the soaring prices of gasoline and food that leave consumers with less money for monthly mortgage payments.”
“‘Every time we think we found the bottom, something happens globally,’ Winckel said. ‘We have gone long beyond the stage where it was all about (the collapse of) the subprime mortgage market.’”
The Visalia Times Delta. “When Derek and Lauren West bought their home last year in a cozy, well-established rural subdivision south of Visalia, they were told upscale homes would be built next door where a golf course once operated. They’re still waiting.”
“‘I wish the golf course was still there,’ said Derek. He is referring to the Sierra View Golf Course, which surrounded the development until 2006. The grounds that were once an 18-hole golf course are now overgrown with weeds — and an increasing fire danger, the Wests say.”
“‘Actually, it would have been OK to have homes there, too,’ he said.”
“The Wests — owners of one of 32 existing homes in the rural neighborhood — simply want proper maintenance of the now-vacant land until such time as construction takes place.”
“Some four years ago, Reynen-Bardis bought up thousands of Visalia-area building lots, including some 10,000 lots from Mangano Homes, said Mangano partner Robert Dowds. Reynen-Bardis founder John Reynen filed for personal bankruptcy Wednesday — stemming from nonpayment of $750 million in loans acquired by the company that were personally guaranteed by Reynen and co-founder Christo Bardis.”
“‘Right now, there are no new proposals [for that site],’ said Tulare County Supervisor Phil Cox.”
The Merced Sun Star. “Casey Steed wants to know where his bike path is. The trail runs through two new subdivisions in northeast Merced. It’s the responsibility of the two developers building the new neighborhoods to put in the path — it was one of the conditions of approval when the city OK’d their projects.”
“But now that building has stopped at Bright Homes’ Summer Creek neighborhood and Lakemont Homes’ Moraga development, so has work on the path. It’s one of several infrastructure projects around the city that have hit similar roadblocks. Standing in their way: a frozen housing market.”
“Steed says the unfinished path shows that the city doesn’t follow its ‘growth pays for growth’ policy. That’s the mantra city officials repeated again and again as new developments were approved, to assure residents that infrastructure would keep up with new housing, said Steed.”
“He took his complaints to the City Council earlier this month. ‘I was going to bring the tape where several council members stated that development pays for development, but it wore out,’ Steed told the council. ‘And quite frankly I’m tired of hearing it. When these projects were approved I don’t think there was any qualification for (what happens) if the market falls out.’”
“After Steed voiced his concerns, the City Council instructed staff to apply for a state grant that could pay for the unfinished path, instead of waiting for developers to start building again.”
“To Steed, that’s an unacceptable solution. As he sees it, the developers were responsible for the work, and the city was supposed to make sure they did it.”
“‘Who’s asleep at the switch over there (at the city) and how come these things aren’t being watched?’ said Steed. ‘It’s too little, too late.’”
The Monterey County Weekly. “(A) Monterey-based hard money broker has deeply reduced interest payments, alarming hundreds of local investors who want their cash back.”
“David Nilsen, owner of the lending and investment firm, says investors were never guaranteed 10.75 percent, nor were they told their investments were liquid. ‘I never told them they could walk in and get their check,’ Nilsen says. ‘We are not a bank.’”
“Cedar Funding has about 1,500 investors, most of them local, Nilsen says. The company, he says, manages about $160 million in loans secured by deeds of trust on commercial and residential real estate located on the Central Coast and other parts of California.”
“‘Most of the loans we have are construction loans and they have interest reserves,’ Nilsen says, adding that the reserves are funded by new investment money that comes in every month. He says negative media coverage of the real estate market has scared off new investors. ‘We have a slowdown of money coming in right now.’”
“In an April 10 letter to investors, Nilsen says deed-of-trust investors will receive their money once the borrowers’ checks have cleared the bank. Investors like Beverly Hartnell are anxious for the check to clear. Hartnell is retired and lives off Laureles Grade. She invested $100,000 between the mortgage fund and a portion of a deed of trust.”
“Now Hartnell feels insecure about her finances. ‘Those two dividends are actually money that I use to pay my bills,’ Hartnell says. ‘Fortunately, I have a little bit of savings. Otherwise I’d be eating a lot of beans.’”