What The Rise And Fall In Housing Has Done
The Ventura County Star reports from California. “Thousands of Ventura County residents were pushed out of their homes last year, and many more were left hanging on by a thread — a situation exacerbated by mounting job losses. In Ventura County, December foreclosure filings surged 37 percent from November and 97 percent from a year ago, according to RealtyTrac. ‘The primary cause of the rising foreclosure rate is really the jobless rate,’ said Sung Won Sohn, economics professor at CSU Channel Islands.”
“‘I think it has kind of spread and is reaching a new group of homeowners,’ said Kay Wilson-Bolton, a broker with Century 21 Buena Vista and a foreclosure specialist. ‘Now it seems to be reaching into the middle class.’”
“Banks seemed to be laying low during the holidays, she said. However, she’s gearing up for more foreclosures in 2009. More homeowners are seeking her advice, wondering if they should try to keep their homes. They’re less emotional and less willing to fight to keep their homes than they were a year ago because they see the price slide continuing and ‘want to get out before it’s really bad,’ Wilson-Bolton said.”
“Now they’re looking at it like a business decision, considering the money they could save in the months living free of charge in a foreclosed home while squirreling away a nest egg, she said.”
“Bill Watkins, executive director of the UC Santa Barbara Economic Forecast, said December’s data indicates ‘that we’re not at the bottom of the cycle.’ Homeowners might try to make payments after losing a job, but they’ll eventually walk away and move out of state if they can’t find work, Watkins said. ‘There’s no way to sell a home in this market … and walk away whole,’ Watkins said.”
From Consumer Affairs. “‘State legislation that slowed down the onset of new foreclosure activity clearly had an effect on fourth quarter numbers overall, but that effect appears to have worn off by December,’ said James J. Saccacio, CEO of RealtyTrac. ‘The big jump in December foreclosure activity was somewhat surprising given the moratoria enacted by both Freddie Mac and Fannie Mae, along with programs from some of the major lenders and loan servicers aimed at delaying foreclosure actions against distressed homeowners.’”
“‘Clearly the foreclosure prevention programs implemented to date have not had any real success in slowing down this foreclosure tsunami. And the recent California law, much like its predecessors in Massachusetts and Maryland, appears to have done little more than delay the inevitable foreclosure proceedings for thousands of homeowners,’ he said.”
The North County Times. “City managers from across Riverside County are scheduled to meet Thursday to consider recommendations from a county ‘red team’ to prevent the county’s already dire housing crisis from leading to an exodus of biblical proportions.”
“About one-third of the two counties’ 1 million housing units either are in foreclosure or are in danger of entering the process, according to calculations from a Redlands consulting firm.”
“Perhaps the biggest obstacle is homeowners’ reluctance to seek help and a suspicion of those offering assistance, county officials and real estate experts agree. ‘People are not coming out to ask for the help they need,’ said Sabdi Ramirez, a real estate agent in Murrieta. ‘They are embarrassed and don’t know people are willing to help.’”
The Press Enterprise. “A California law that requires mortgage lenders to give customers 30 days notice before filing a default, appears to have only postponed the problems of financially troubled homeowners rather than resolved them. Between November and December, California saw a 122 percent surge in default notices that begin the foreclosure process, following a three-month decline, RealtyTrac reported Wednesday.”
“Lisa Jarman, a counselor with the Fair Housing Council of Riverside County, said there are modification programs…but she said most of her clients have too much debt or too little income to qualify.”
“Several economists and analysts predict the pain will continue through 2009 because of a worsening economy. ‘Rising unemployment is going to be the major catalyst for continued foreclosures in 2009,’ said Greg McBride, senior financial analyst with Bankrate.com.”
The Daily Bulletin. “More than 300 job seekers crammed the community center at Homecoming at Terra Vista apartment complex in Rancho Cucamonga on Tuesday afternoon, filling out applications and going through interviews with Lewis Apartment Communities officials. Fourteen to 18 jobs are up for grabs, giving the company an enormous pool of candidates to choose from.”
“‘It was incredible,’ said Nadene Chavez about the crowd of applicants, something she never expected to see. With her husband’s recent layoff from a construction equipment rental company, Chavez is trying to get back into the property management field, something she has 13 years experience in.”
“She lives in Covina, but the couple are thinking about selling their home and finding an apartment in San Bernardino County to live in so they can lower their monthly bills.”
“Mark Miller’s a carpenter by trade, eking out a living over the past few years by doing framing for homes in Big Bear Lake but was laid off because of the home-building slowdown. He applied for a maintenance-groundskeeper job. If Miller can’t find work locally, he’s ready to travel. He’s already looked into jobs at a livestock ranch in Nevada.”
“‘I’ve got my mattress back here,’ he said, slapping the side of his van. ‘I’ll go if I have to.’”
The Redlands Daily Facts. “Sen. Bob Dutton (R-Rancho Cucamonga) introduced SB 49 on Jan. 13, which will establish a homebuyer tax credit for single-family homes. According to Jim Earp of of the California Alliance for Jobs, ‘Construction is critical to the California economy and housing is a key element of the industry. When housing is down, we’re out of work.’”
The Union Tribune. “Saying they’ve been left out of the federal bailout package, about 50 home builders and construction workers marched outside three banks in downtown San Diego yesterday to protest foreclosures that halt construction work. The demonstrators, organized by a coalition of builders, called on lenders to modify distressed construction loans to allow builders to complete unfinished projects.”
“One of the marchers was Tom Dobron of Escondido, CEO of Innovative Communities. Dobron said his bank had declined to negotiate with him when he went into default on a $15 million construction loan a year ago. ‘I had nearly 100 people working for me,’ Dobron said. ‘I had to lay everyone off. Banks are not working with builders. I was forced out of business.’”
The Voice of San Diego. “An exceptionally loud opponent of government regulation in the construction of housing in good times has found a new target to bark at in the market crash: banks. Mick Pattinson, president of Barratt American, has rallied builders for years around common causes — lowering government fees for constructing homes and fighting back against development opponents.”
“Now, despite filing for bankruptcy protection late last month, Pattinson hasn’t lowered the volume. He gathered a gang of builders, subcontractors and laid-off employees who toted signs and chanted ‘Banks behaving badly!’ outside three banks in downtown San Diego on Wednesday morning.”
“Pattinson’s current case: banks created this housing downturn in the first place with reckless mortgage lending and thus shouldn’t be allowed to cut builders off from the funding they were promised. He’s assembled more than 160 builders nationwide to push for government intervention and regulation for banks.”
“‘Everybody had their snout in the trough,’ Pattinson said. ‘When markets rise, we rise with them, and when markets fall, we fall with them. It’s a risk business.’”
“Pattinson blames the crash in the market to the opaque systems banks were using to fuel the housing frenzy. The banks didn’t explain how they were operating, he said. He claims the real estate industry couldn’t anticipate how bad the downturn would be. But especially near the end of the boom, Pattinson and the region’s homebuilders had clues the system was on shaky ground.”
“Barratt American had a mortgage lending arm that turned away some would-be buyers who couldn’t qualify for the loans. Pattinson’s sales team began seeing those same customers who’d been turned down coming back to purchase a house. They’d gone to a mortgage broker with less stringent requirements, and they were back. The company couldn’t discriminate against those buyers, Pattinson said.’
“But could the builder have used that trend to foresee tough times ahead? ‘We knew it was going to end,’ he said, quickly revising his own words. ‘I say ‘we knew’– that’s an overstatement.’”
“John DeMaria owns DeMaria LandTech Inc., and is listed as a creditor in Barratt’s Chapter 11 filing. He’s owed more than $450,000. His company worked on pools and common areas in the Magnolia Estates project. When the builder kept sending requests for more work, DeMaria kept hiring workers to do it. Eventually, he wound up with a backlog of invoices that Barratt American was unable to pay.”
“‘I took a home equity line on my personal house to pay their bills and now I have to sell my house,’ he said. ‘It’s horrible.’”
The Union Democrat. “New Tuolumne County building regulations could soon reflect the reality of the current economy, which is seeing builders postpone projects due to a lack of financing. The Tuolumne County Board of Supervisors on Tuesday waived the first reading of a proposed ordinance that, among other things, would remove a two-year expiration date that is applied to building permits.”
“Local developer Jim Todd, of California Gold Development Corp. in Sonora, said, if anything, the current economic crisis has shown people how important the building industry is to the economy. ‘Hopefully, the thing people are starting to wake up to is we’re all in this together,’ he said. ‘Our segment of the economy ripples to the others. We’re seeing what the rise and fall in housing has done to the national economy.’”
The Record Searchlight. “Mirroring the rest of the country, foreclosure activity in Shasta County spiked in 2008. Foreclosure filings in 2008 jumped 268 percent from 2006, when RealtyTrac reported 443 in Shasta County. ‘It’s unprecedented,’ Mike Van Bockern, who conducts foreclosure auctions daily in Shasta County, said of 2008.”
“The median sales price in November in Shasta County was $210,000, a 14 percent drop over a year ago, DataQuick reported. Joe Rodola, a Redding credit counselor who also teaches a monthly first-time home buyer class, said some good is coming out of what he considers to be a ‘real estate disaster.’”
“‘I was complaining a couple of years ago that nobody was coming to my class because nobody could afford to buy,’ Rodola said. ‘Now with prices dropping to $200,000 and below, bam, first-time homebuyers are now eligible again.’”
