April 30, 2014

The Miracle Business

The Santa Cruz Sentinel reports from California. “It’s tough for home buyers in Santa Cruz County. In March, the median price was $662,750, the highest in a year except for November, according to Gary Gangnes of Real Options Realty, who tracks the numbers. Judy Brose, an agent with Century 21, helped her client sell a home just under 1,000 square feet for $635,000. Listed for $559,000, it got seven offers. The successful buyer made the highest offer and paid cash, with two of the others asking if they could offer more. ‘I feel like I’m in the miracle business,’ said Brose.”

The San Francisco Chronicle. “Claudia Flores is a 36-year-old professional who has worked in the City Planning Department for eight years. She was booted in October from a three-bedroom condo where she rented a room for $1,000 a month. The rent for the entire place, which is not covered by rent control, was going up to $6,300 a month.”

“The owners said, ‘We would love to keep you because you’re a wonderful tenant, but we don’t think you can afford that rent,’ Flores recalled. They added: ‘Maybe you could find somebody who works for Google or YouTube, and they could take the larger room and that would allow you to stay.’ Now she’s crashing with friends and trusting a space will open up in another friend’s apartment next month.”

The Glendale News Press. “The median price for a home in Glendale dropped below the $700,000 mark last month for the first time since last fall, according to the latest real estate report. The median price for a single-family home was $689,000 last month according to statistics compiled by Realtor Keith Sorem with Keller Williams in Glendale. Diana Walker, a real estate sales agent with Dilbeck Real Estate, said home prices have gradually risen during the past 12 months, but they might have finally peaked.”

“‘I think they’re adjusting now. They’re not just going up constantly like they have for the past year,’ she said. ‘We’re seeing buyers feeling a little more confident.’”

The Desert Sun. “In Palm Springs in March, the year-over-year median price for a home climbed 48 percent to $369,500 in north Palm Springs and rose 44 percent to $325,000 in south Palm Springs. But sales in Palm Springs were slow, dropping roughly 18 percent from March 2013. The high demand for Palm Springs has been largely fueled by retirees and second-home buyers, many from coastal communities, who desire the trendier vibe of the city, said Kevin Stern, a broker for Town Real Estate in Palm Springs.”

“‘Some of the prices are a little too high, and prices are almost back to the point where they were before the fall,’ Stern said.”

“Though prices are rising, the buying frenzy in the rebounding market has started to calm down, agents said. ‘Some of those sellers that were putting their houses at the higher peak prices,’ said Tim Schneider, a Windermere agent in Palm Springs. ‘Now they are sitting a bit longer. Things have leveled out a bit, and some of them have had to reduce their prices.’”

The Street. “Eyebrows were raised all over Wall Street this week, and likely on Main Street, too, after the U.S. Commerce Department released its single-family home sales figure for March. The news wasn’t good for the real estate market, as sales fell by 14.5% for the month, and 13.3% against March 2013 figures. According to Redfin, only 49% of homeowners say they are in a ‘financial position to sell’ their homes right now. That leaves 51% who aren’t ready to sell, for a variety of reasons.”

“‘Competition can still get intense, but because prices have risen so much, my clients and I try to be more discerning about how far we should go to win a home,’ says Minni MacFarlane, a Redfin agent in Orange County, Calif. ‘The past two years we’d compete against people camping out in their cars or entering lotteries to win new homes. This year, a bidding war is more likely to drive the price of a home higher than it’s worth competing for, and I think it will be easier for us to walk away from a situation like that.’”

The Bakersfield Californian. “A climactic chapter in Bakersfield, Calif.’s, long-running Crisp & Cole saga may have closed with last week’s verdict in the trial of Julie Dianne Farmer, but the larger mortgage fraud case is by no means resolved. Still to come are sentencings for nine of the 15 remaining defendants, including Farmer, the former office manager found guilty Tuesday in U.S. District Court in Fresno of five of 12 counts against her. But even those decisions go only so far in putting to rest a case that shook Bakersfield’s real estate industry and which federal prosecutors say cost lenders about $30 million.”

“One of the case’s first whistle-blowers, local real estate appraiser Gary Crabtree, is still asking questions about how the case was pursued. He criticized what he saw as sluggish action on the part of law enforcement he first alerted to the fraud in 2006. ‘When you look back at the case, why did it take 7 1/2 years?’ he asked. ‘I mean, that’s a question that needs to be answered, because the strategy of the Department of Justice and FBI on mortgage fraud was to select the most egregious fraud cases from across the country and prosecute them vigorously in a timely manner.’”

“That strategy was supposed to send a message to the real estate industry, he asserted. ‘If that was the goal, it failed miserably,’ he said.”

Bits Bucket for April 30, 2014

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