A Star-Crossed Street Of Dreams In California
The Mercury News reports from California. “In the Bay Area, 2,780 homeowners received a notice of default in August, the first step in the foreclosure process. That’s a 34 percent increase from July, and essentially unchanged from a year ago, said RealtyTrac, which defines the region as Alameda, Contra Costa, Marin, San Mateo and San Francisco counties. Joy Di Ricco, a Realtor with the Antioch office of Better Homes and Gardens, said Chase Bank filed a foreclosure notice in July on a home she was trying to sell in a short sale transaction for a client. ‘That was seven months after they missed the payment,’ she said, adding that the standard for filing notices in a normal market is about three months.”
From Beyond Chron. “The foreclosure crisis is costing San Francisco almost $7 billion, according to a new report released today in Bayview by our statewide coalition of homeowners, community leaders and students. ‘This report quantifies what people in California have been feeling for years – banks’ practices are financially devastating to our neighborhoods and cities,’ said Curtis Warren an Alliance of Californians for Community Empowerment member and a Bayview resident at the brink of losing his home.”
“In San Jose, in addition to the 43,544 foreclosures, more than 51,000 homeowners are underwater on their loans. As David Sharples, a member of the alliance, and others talked, a tight core of activists chanted, ‘Shame on the banks. Shame on us for putting money in the banks. It’s all about the money.’ Some held signs saying ‘Stop Foreclosures’ and ‘Save Homes.’ The group also claimed that once homes are foreclosed, banks allow them to remain empty and uncared for in the community for too long.”
“But Beth Mills, spokeswoman for the California Bankers Association, said state legislation passed a few years ago requires banks to maintain a property once it assumes ownership, or risk fines up to $1,000 a day. ‘It takes over 300 days to complete a foreclosure,’ she said. ‘Banks can’t come in and take care of that property until it’s officially theirs.’”
“‘One woman said she’s used all of her savings trying to hold onto her house,’ said Ana Guardado, an alliance member and East Side resident for 27 years. ‘She expects to lose her home.’ As the housing crisis worsened, Guardado said she watched longtime friends move away as they lost their homes on South King Road. ‘Two years ago, I saw a family standing outside in the yard on Christmas Day, and I decided I had to get involved. The family had all this stuff spread out and they had a Christmas tree in the front yard so their kids could have Christmas.’”
The Press Enterprise. “The soft housing market is not delaying buyers at The Enclave, most of whom are keeping their existing homes and renting them out, in some cases to relatives, said Kris Kapp, a sales representative. But to qualify to finance a second home, they have to prove they earn enough to pay both mortgages without considering rent revenue. Eastvale also is drawing buyers from Pasadena, West Covina and Diamond Bar where a similar house would sell for twice the price, Kapp said.”
“Robert Shiraki moved from Northern California to take a management job in Corona. Shiraki recently checked out Orchard Glen, a move-up community by Standard Pacific in the south Corona foothills where the price of a four-bedroom single family house with 3,215 square feet starts at $478,320. By contrast, he said his four-bedroom townhouse in the Bay Area, which he plans to keep, is worth about $900,000.”
“‘It is just unbelievable the deals,’ he said. ‘It is a very good place to buy.’”
The Union Tribune. “It’s one of the more bewildering aspects of the mortgage crisis for struggling homeowners — a bank processing a loan modification and proceeding with foreclosure at the same time. After Del Mar homeowner Raquel Barrios-Haunschild made several modified payments in late 2009, Aurora said it would like to offer her a permanent modification and told her to keep paying until it could finalize an analysis of her loan. Over the next 10 months, Barrios-Haunschild made $28,300 worth of modified payments. Last October, Aurora moved to foreclose, saying it could not approve a permanent modification because she failed to provide enough information.”
“Several said they went into default only after their lender said it was required to qualify for a modification. In a suit filed last month, Markham Speros, who runs the PC Help Desk computer consultancy in La Jolla, said that is what happened to him when he defaulted to get a modification from Bank of America. ‘I followed their lead and now I face losing the place I’ve been living (in) for 17 years,’ he said.”
From The Hill. “Leading House Democrats are accusing the Obama administration of ignoring the lingering mortgage crisis and threatening tens of millions of Americans with foreclosure in the process. ‘The administration has been AWOL on this issue,’ charged Rep. Dennis Cardoza (D-Calif.), ‘and the American people are suffering because of the mismanagement. In my entire political career, I’ve never seen anything this irresponsible,’ he added.”
“Another problem, charged Rep. Jim Costa (Calif.), is that the administration is sending community banks conflicting messages. On one hand, the White House is asking them to build up capital and write off their bad loans, he said. On the other, it’s asking them to help struggling homeowners refinance in ways that would hurt the banks’ bottom line. ‘Their policies are in contradiction with one another,’ Costa said.”
“Consumer groups, meanwhile, are wondering why it’s taken so long for policymakers to turn their sights on the lingering housing crisis, which was a central cause of the Great Recession. ‘You’re not going to create jobs until you fix the economy; you’re not going to fix the economy until you fix housing; and you’re not going to fix housing without addressing foreclosures,’ said Kathleen Day, spokeswoman for the Center for Responsible Lending, a consumer advocacy group.”
The San Gabriel Valley News. “Home prices in Los Angeles County continued to slide last month. Amy To, an agent with Coldwell Banker Dynasty in Arcadia, said home sales are being constrained because of the strict regulations that lenders have put in place. ‘There are a lot of people looking, but it’s still tough to get a loan, even for regular, medium-income families,’ she said. ‘People can’t qualify for loans because the FHA and Fannie Mae have such strict guidelines. If they loosened up a little bit home sales would increase dramatically.’”
“To said she and her husband had difficulty getting a loan on a $400,000 home, even though they came in with a downpayment of more than 60 percent. ‘Two lenders rejected us, and the third accepted us,’ she said.”
“To said distressed properties still account for a big chunk of the transactions her office handles, an area that primarily includes Baldwin Park and West Covina. ‘Sixty percent are still REOs or short sales,’ she said. ‘I think this is the time to buy. There are bargains out there for buyers.’”
The Press Democrat. “Sonoma County home sales rose last month to their highest level in nearly three years, as more owners who still had equity in their houses agreed to sell. Real estate brokers said the increase in such sales suggests that more homeowners have chosen to sell after concluding that prices aren’t likely to rise significantly any time soon. ‘I think people are finally digesting the new reality,’ said Stephen Liebling, the Coldwell Banker manager in Sebastopol.”
The Union. “When Nevada County finally upgraded a nearby sewage treatment plant and laid sewer pipes between the plant and the south county DarkHorse development in October 2010, it seemed like years of legal wrangling finally were over. But a complaint for damages filed in Nevada County Superior Court by DarkHorse Golf Club LLC promises more to come.”
“First billed as the ’street of dreams,’ the luxury development next to Lake of the Pines went into foreclosure in 2007 when developer Ed Fralick defaulted on the property. Funding for unfinished electrical hook-ups and wastewater treatment dried up. The corporation’s Grass Valley attorney is asking for compensation because it shouldered more than $580,000 in sewage treatment services for three years, and has named the DarkHorse owners association and more than 80 property owners as defendants.”
“According to Nevada City attorney David Alkire, who has been retained by a number of the DarkHorse property owners, DarkHorse Golf Club does not have the legal right to recover any of those costs. For one, Alkire wrote in his demurrer, the purported causes of action cannot be proven because of ‘inconsistent, vague and contradictory claims and allegations.’ DarkHorse Golf Club LLC ‘has filed an action that apparently names as defendants all other property owners in the star-crossed DarkHorse housing subdivision,’ Alkire wrote.”
Southern California Public Radio. “The unemployment rate in California is far higher than the national level — 12 percent versus 9.1 percent — and that’s depressing for residents of the state. But there’s one other state that’s doing worse: Nevada, at 12.9 percent. The temptation is to put the two states in the same boat, because there are some similarities. ”
“The idea that California and Nevada can be subjected to an apples-to-apples comparison just because they sit atop the high-unemployment tally is sort of ridiculous. Nevada may have Vegas and gold mining, but California has Hollywood and Silicon Valley. Besides have a much larger economy, California has a much more diverse and innovative economy. The housing collapse is something that Nevada may never recover from. In California’s case, it could just take a while.”
“But before anyone in California gets too cocky, they should ask themselves how they’ve allowed a nearly $2-trillion economy to become so dependent on housing and government jobs that the more highly productive sectors, technology and entertainment, can’t create enough work to at least bring the unemployment level down to something that’s within striking distance of the fairly appalling national number.”
“The implications are serious. The country can handle a protracted economic slump in Nevada. But it’s counting on California to be an engine of growth and to lead it into a brave new economic future.”
