The Housing Bubble

The Ventura County Star reports from California. “Legislators have approved the Homeowner Bill of Rights. The first-of-its-kind bill package passed the Assembly and Senate on Monday. It will become law Jan. 1 if Gov. Jerry Brown signs it, and he’s indicated he will. Thousand Oaks Realtor Judy Seeger sells bank-owned properties. She has little sympathy for people whose homes are underwater who are unemployed and who haven’t made payments. She said she’s seen some people looking for ‘free rent’ and squatters living in foreclosed homes. ‘You can’t even get squatters out,’ she said.”

“Seeger said banks have had so many new government programs to digest since the start of the foreclosure crisis that adding another will be burdensome to understand and implement. ‘That’s the problem,’ she said. ‘If another program is implemented as wide ranging as this one, we are going to be having nothing but lawsuits.’”

The San Mateo Journal. “Attorney General Kamala Harris deserves much of the credit for events leading up to the approval of the measures. She realized that California is different from other states, including those that were hard hit by the foreclosure crisis. Assuming Brown signs the measure into law, Harris, like the Legislature, should monitor the situation. She needs to make sure the law helps end the housing crisis and doesn’t impede California’s painfully slow recover.”

The Bakersfield Californian. “The supply of houses for sale in June was down 7 percent from May and down a whopping 37.1 percent compared to a year ago, according to the June Preliminary Crabtree Report. Robert Dobbs of 611 Realty said potential home buyers need an aggressive agent because decent homes are being bid on sight-unseen the minute they are put on the market. ‘Some people are bidding, 10, 20, 30 thousand over the asking prices,’ he said. ‘There’s just so much competition and not enough inventory. The ones who want bargains aren’t getting a home.’”

The La Jolla Light. “So far this summer, my last three home sales have been second-properties for out-of-state buyers – a figure that makes up 25% of my recent sales activity overall. These buyers are coming from areas like Texas, Arizona and Nevada, and many are realizing that, at this point in time, it makes more sense to buy than to rent vacation real estate.”

“The best opportunities for buyers and sellers have already passed. Right now, with such low interest rates and lower prices than we have seen in the last 5 years, buying is the most practical option for San Diego vacationers.”

The Daily Breeze. “Prices in the Los Angeles-Long Beach-Glendale census area rose 0.9 percent year over year, according to CoreLogic. Ray Burch, a Realtor whose office covers the entire South Bay and Harbor Area but focuses on the San Pedro market, said the national trend of low inventory driving prices higher also applied locally. ‘Homeowners don’t want to put their home on the market because they hear about the low prices and they want to wait,’ Burch said.”

The Santa Cruz Sentinel. “The Los Gatos developer of a Salinas subdivision was arrested on federal charges of defrauding banks of millions of dollars, U.S. Attorney Melinda Haag announced. Muhammad Safadi, who built 14 single-family houses in the Rancho Amistoso subdivision, defrauded bankers when he and his nephew sold the houses to unqualified buyers and then lied on their financing paperwork, a federal grand jury indictment said. The first foreclosure came in 2008, when a $725,000 home sold for $288,000, the grand jury found.”

The Auburn Journal. “There are 172 parcels on Placer County’s impending power to sell list, totaling nearly $2.5 million in defaulted property taxes. They are on the list because they missed at least one tax payment in the 2006-2007 fiscal year. The county can only begin the impending power to sell process on properties that have been delinquent for five or more years.”

“Ralph Swift, who owns Granite Bay Woods LLC, said he hopes to pay the outstanding taxes on two parcels in the development as soon as possible. His development backs up to Los Lagos in Granite Bay. ‘It’s just lots are not moving, especially high-end lots are not moving,’ Swift said.”

“The Journal made an effort to visit all businesses on the delinquent tax roll, but Granite Bay Woods LLC was the only one with a local physical address.”

The Press Telegram. “Currently, real estate agents are required to have a business license if they are doing any business within Long Beach city limits. The licenses, which cost the agents $200, must be renewed each year. The Long Beach City Council on Tuesday requested that city management find out the cost to eliminate the per-agent business license fee.”

“‘Requiring Realtors to pay such a large fee seems fairly unreasonable,’ said Jamie Saltman, president of the Women’s Council of Realtors in California. ‘I would guess that most agents would really love to not have to pay a fee to the city, and just to the brokerage. And really, this couldn’t have come at a better time. Realtors are struggling and have been for a couple years.’”

The Victorville Daily Press. “Imagine driving north on Apple Valley Road from Bear Valley Road and all you see is farmland stacked with hay. That wasn’t so long ago, when the High Desert used to be scarcely populated and by people who preferred a rural lifestyle. But urbanization and limited water hit agriculture in the desert, and many farms and ranches either shut down or moved out. As the population grew in the High Desert, land owners could make more money selling off their properties for housing and shopping development than cultivating them.”

“Earl Graham has been running an agricultural marketing company out of Apple Valley for about 40 years. ‘You can’t blame a guy that’s 70 years old, some developer comes up and offers him what appears to be a huge amount of money for his land,’ Graham said. ‘You can’t blame him for selling out.’”

“The recent recession hasn’t helped farmers, either. Martin Frazier has been raising hay for nearly 30 years in Apple Valley and started Frazier’s U Pick Pumpkin Patch to grow pumpkins for Halloween and corn for a maze. ‘The economy is killing us,’ he said. ‘Everybody’s selling horses. People don’t have money to buy pumpkins for Halloween.’”

The Mercury News. “The golden touch of Russian investor Yuri Milner, who made a killing on Facebook, apparently doesn’t extend to Silicon Valley real estate. The Santa Clara County assessor said that the Los Altos Hills mansion the Russian billionaire paid $100 million for last year is worth a mere $50 million. The mansion’s purchase through a limited liability corporation made headlines last March as the largest amount ever paid for a home in the U.S.”

“Assessor Larry Stone said that the house has a fair market value of $50,270,000, following an extensive survey of other mansions as far away as Beverly Hills. Did Milner pay too much for the lavishly appointed mansion? ‘Overpaid’ is relative and judgmental,’ Stone said. ‘He paid more than the fair market value.’”