Tracy Real Estate Blog

Recovery

Wed, 16 May 2012 00:00:00 GMT

There’s a well known real estate blogger in the mid west who wrote a post a week or so ago in which she disputed the use of the term “recovery” with regard to the real estate market. She really wasn’t being negative, it just doesn’t seem to fit with the reality of her market place. At one point she states

“There won’t be any recovery because recovery implies that it will get back to what it was and that can not happen.”

I think that’s a very interesting point. Is it true? Certainly, we’re not heading back into a market where large numbers of buyers are using zero down, sub prime loans to purchase homes. We aren’t going back to that era…I hope! I think in many parts of this country the devastation that was wrought in the last 5 years was incredibly potent. I’m sure it’s hard to see how it can be possible to become whole again. Clearly, there’s still plenty of folks under water and we have not reached a stage where everybody is in the black again around this area too.

The thing is though, we’re actually seeing homes sell in 2012 for all time high prices. I really think the idea of recovery is one that’s very real if you live in our area. When there’s multiple offers on just about everything it’s sort of hard not to think that recovery is more than just a novel idea. I was around before the big tech boom, during the dot-com early years and all through the meltdown years. This market feels as hot to me as any I’ve seen in 22 years. Maybe it’s not 2004…but it’s close. Maybe it’s not a recovered market but it’s a different and pretty healthy market if you ask me.

What is For Sale in Tracy?

Thu, 10 May 2012 00:00:00 GMT

Every week I have a number of clients that anxiously await the arrival of new listings on the market. That’s especially true so far in 2012 with the inventory being so amazingly low. Folks flock to open houses on new listings and multiple offer feeding frenzies occur quite frequently now a days. Sometimes places are in fantastic shape and sometimes they aren’t yet most of these new offerings sell quickly, and lately over the asking price. Yet, there’s still those homes that just sit there…and some sit there some more! What about those places? Why don’t they sell and are there opportunities for buyers there?

The market is so very focused on the first 2 weeks of a listing. If a seller is going to get multiple offers is almost a certainty that it’s going to happen in the first 10 to 14 days of a listing. Buyers rush out to see the new listings and if they aren’t struck by the place immediately they move on to something else. When I look at the MLS I see some homes that are just sitting there, and it seems like they’re never going to sell and I can’t help but wonder why? Often the answer to that comes quickly…the price is too high (often WAY too high), the project it’s in is a disaster, it’s a short sale and buyers have backed out because the bank can’t get it’s act together and approve (or even look at the file) the loan. Sometimes the place has a difficult structural problem or a significant location challenge and sometimes the home just shows incredibly poorly.

Appraisals, My Son's Take

Wed, 02 May 2012 00:00:00 GMT

I was sent this article and here are my thoughts….

Short appraisals driving up failed home sales

http://www.seacoastonline.com/articles/20120421-BIZ-204210332

Here's an increasingly common scenario: The seller lists the house for $325,000, the buyer offers $275,000 and they settle on $300,000. A week before closing, the appraisal comes in at $265,000, the maximum upon which the bank or mortgage company is willing to lend. Who's going to make up the $35,000 shortfall? Depends on who is the seller. If it’s a short sale or foreclosure I have found that the bank will usually eat the difference. If it’s a flip or a regular sale the seller will usually put it back on the market or the other option is the buyer and seller will negotiate a lower price and meet somewhere in the middle. From a buyers prospective this is a good thing. I have noticed that often in a market where the prices are starting to go up the appraisals will often come in short. This happened in 09 when I bought my house. We were experiencing a temporary price increase due to 8K tax credit and overbidding. I got my house accepted for 140K and the appraisal came in at 100K. I got the house for 100K. It was a gamble but the buyer won in that case. This is really similar to how the market is now, with the buyer frenzy and lack of inventory. The biggest losers here are the flippers which are constantly trying to manipulate the appraisals. Even in this market. They require the appraiser to meet them. They require the buyers to use their lenders which are often brokers who are able to manipulate appraisals better then big banks such as wells or BOFA. And let’s not forget how it used to be in 2002-2007. We could get any appraiser we wanted to bring in whatever value we needed.

Short appraisals typically arise in a declining housing market because the lack of recent comparable area home sales, or "comps," making it difficult for appraisers to determine the current market value of a property. When home sales slow, good comps "age" fast. Add foreclosures and short sales and appraisals can run all over the map. I really don’t think our local market is declining at this point. The real problem is the short sales we are getting in contract and waiting for approval. As prices increase the short sales we get for 200K are six months later going to be worth 220K and the bank is going to want more once they get around to appraising and approving the sale. Sure sales run all over the map. We are seeing a lot of non-competitive offers being accepted at lower prices and skewing our sales. Look at all the homes that sell for low prices(all shorts and foreclosures.) before they even come on the market they are marked pending on day one and sell lower than average because they never see competitive offers that would bid up the house to market value. To me that is a big problem with the industry and the banks are the ones seeing this loss.

The Home Valuation Code of Conduct, or HVCC, that went into effect last May compounded the problem. HVCC prohibits Fannie Mae and Freddie Mac lenders from having direct contact with appraisers. As a result, most lenders opt to work through appraisal management companies, or AMCs, whose pool of residential appraisers includes those with limited training and/or little familiarity with the geographic area being appraised. The true root of the problem is with the quality of appraisals. Its true there are good appraisers and bad ones, just like agents, cooks, contractors or anything. It’s the luck of the draw and I still think pulling a random appraiser is better for the buyer then to use a “pocket appraiser” they just need to develop a better system and require local appraisers to appraise local properties.

No system is perfect but I believe it’s more better than it used to be and there is still a lot of improvements to be made before we get it right!

New Rules For Short Sales

Mon, 30 Apr 2012 00:00:00 GMT

New Rules

As much a pain as short sales have been there’s one thing that’s pretty much been a certainty when you go about trying to buy one. That is that you don’t really have to commit until the bank approves the short sale. You don’t need to make your deposit with a Title company, you don’t need to spend money on inspections since it could take months to get the bank to even look at the file on this type of property. I mean really, why would a buyer spend their money on inspections when the bank could easily reject their offer or not respond in 5 months? Why would you put a 3% deposit into escrow where an underwater seller has to sign a release if you decide you’re sick of waiting for the bank to work this out…if it even is possible? The California Association of Realtors has a nice little disclosure called the “Short Sale Information and Advisory” that says the following:

“Buyers may expend money on inspections, loan applications, escrow fees and other costs that they will not be able to recover from anyone if the lender does not approve the transaction. Buyers may also have difficulty obtaining the return of their deposit in escrow if the seller becomes uncommunicative during the short sale process”.

Well, we’ve now entered the crazy world of 2012 real estate around here. Short sales are getting multiple offers now. I saw one this week where the listing agent has a sheet of rules for the transaction that states the following:

”Must have initial deposit up front deposited to escrow upon acceptance of offer by seller”

What? Seems the new rules in 2012 want to eliminate risk for sellers of short sales. A buyer in this case should tie up their deposit for months. It seems crazy, doesn’t it? The real question is, will enough buyers comply so that this becomes the norm?

Housing Market Has Bottomed

Fri, 27 Apr 2012 00:00:00 GMT

Housing has bottomed. That's the verdict given to a Bloomberg reporter yesterday by Mark Zandi, chief economist for economic analysis and forecasting firm Moody's Analytics. Zandi said of the housing market, "The crash is over. Home sales – both new and existing – and housing starts are now off the bottom."

Our own Steve Sjuggerud recommended a housing play more than a year ago in True Wealth. It's up 8% since then, but I bet it's got plenty of upside left in it. And I told Extreme Value readers housing was an attractive proposition in the March 2012 issue.

Not so long ago, everybody believed housing could only go up. They were wrong. Nowadays, nobody believes housing can go up at all. They're wrong, too. Housing is perhaps the best – or at least most current – example that what the wise man does in the beginning, the fool does at the end. Wise investors are getting into real estate these days. Fools will wait…

Important Information On Short Sales

Wed, 25 Apr 2012 00:00:00 GMT

The Government just Announced that Freddie Mac and Fannie May as of June 15th 2012 will Require Mortgage Servicer's to do the following when a borrower is requesting a Short Sale.

1. Acknowledge Documentation sent in by Borrower's within 3 business Days.

2. Notify Borrowers within 5 days if additional paperwork is needed to complete the Short Sale.

3. They have to review and respond to the Borrower within 30 days of receiving Documentation.

4. If a Short Sale Decision linger beyond the 30 days they are required to provide a weekly update on the Short Sale to the borrower and or there Real Estate Agent.

We applaud the government for getting involved because these Mortgage Servicer's need to be more accountable and it will help the Short Sale process and help people complete a Short Sale. We are experts in Short Sales so please call us or e mail us for a private consultation. We look forward to being of Service.

The Short Sale From Hell

Tue, 17 Apr 2012 00:00:00 GMT

The Short Sale From Hell

Short sales are not fun. Some folks (me included) sort of think of them as hellish. I have one right now that was (supposedly) approved when we ratified our offer in early January that’s still out there waiting for completion. You get excited, you buy a place…and then you wait, and wait….and wait for somebody at the bank or their service company affiliate to finalize your deal. When most folks hear about a short sale they get queasy. When you hear there’s a short sale, which happens allot, where there’s 2 loans queasy turns into weak at the knees. The reason being is that you’ll have to negotiate with both lenders to make this fly. You see, often the seller of a short sale owes on his original mortgage plus a second loan as well. Quite often that’s an equity line. Every once in awhile you’ll see a short sale where there’s 3 loans. Often that happens when it’s a condo and the seller hasn’t been paying both his loans as well as the HOA dues. # lien holders makes you go from queasy to weak in the knees all the way to nauseous.

I recently saw a Short Sale that had 8 loans on it. Talk about the Short Sale From Hell, the First lender will have to get all of the lenders to agree on a short Payoff in order to complete the Short Sale. In this crazy market it will most likely still get multiple offers.

I want A Deal!

Fri, 13 Apr 2012 00:00:00 GMT

What’s Important!

There’s a very strong element of thinking among buyers in this market that really is a hold over from the last two years…but in my opinion is no longer relevant. Whether it's a Short Sale or a Bank owned or regular seller, That element is the strong desire to negotiate the best possible deal. For some folks it really is the most important thing. In answer to the question, what’s important? these folks deep down think it’s the deal.

What I mean by that is that, for some buyers, the deal is the most important thing. Not the house/townhouse/condo…it’s the deal. It’s sort of funny to me that in the face of 10 offers or more on a property somebody will inevitably want to negotiate downward. I hear frequently questions like:

“Can we ask the seller to pay for our closing costs?”

“Do you think we can get the seller to fix all those things on the pest report?”

“How can we get the seller to fix the foundation?”

As I see it in markets like this one, heck in ANY market, the property is the most important thing. That’s the bottom line. If the place is in a good location, has the features you want and is in reasonably good shape,then negotiating over relatively small amounts of money is silly. Yet many folks feel bad if they don’t get a concession out of a seller. So many of the offers I’m seeing right now have no contingencies, have large down payments and are way over the asking price. The actual definition of “deal” in these cases is whether or not we got the place and is it in a location that is likely to appreciate well. The majority of the market here in Tracy California are Short Sales and they are always sold " As Is" the seller nor the Bank will do 0 repairs.

The irony is that making the deal top priority is ultimately a desire to save money. After wasting months of attempting to negotiate these relatively small amounts of money and losing homes in competition…the prices of these homes goes up. By the time it becomes apparent that the home is the most important thing, you’ve lost more money than you had been trying to negotiate originally in market appreciation. I can’t even tell you how many times I’ve seen that…and I’ve seen people who have actually been completely priced out of this area.

Going Way Out On A Limb

Fri, 06 Apr 2012 00:00:00 GMT

Way Out On A Limb

Yet another aspect of the insanity of the current marketplace and one that’s becoming more and more prevalent is the practice of dispensing with any and all contingencies in order to get a home in competition. In the last few weeks especially it seems to quickly becoming the norm. Honestly…I hate the idea. Talk about going way out on a limb! You can, of course, inspect all you want…you just don’t have a contingency to negotiate further over what you might discover. You also can’t back out over these discoveries either.

The long limb really applies to the appraisal and loan contingencies. Since this is a new phenomenon, the values that are coming in on appraisals are typically below the comparable sales for any time prior to. Many times the buyer will check the No appraisal contingency box which means In essence the buyers are saying “Don’t worry about the appraisal, if it doesn’t come in we’ll go ahead and make up the difference in cash to make this deal close.” This can be pretty risky stuff. You’re really guaranteeing the sale for the seller to get them to take your offer.

I really hope it doesn’t start becoming the "Norm" If you don’t have 20% down you’re at risk. I actually had an agent tell me today that she received an offer on a Four Hundred Thousand dollar plus house where an agent presenting an offer with 25% down apologized for not writing an all cash offer. “I’m really sorry, but my clients need a loan” she heard the agent say. Amazing!

There's One In Every Crowd

Thu, 05 Apr 2012 00:00:00 GMT

There’s One In Every Crowd

It happens all the time. There’s multiple offers on a given property and one knucklehead thinks they can successfully win it with their offer written under the asking price. InTracy last month, a house got 15 offers and one of them came in $25,000 under asking. Huh? My question is, what’s wrong with that agent? Who writes an offer like that?

OK, maybe I’m assuming too much. Here’s an absolute. A guarantee. If there’s 15 offers on any given property it’s going to sell over the asking price. No doubt about it. I promise. Also…I think the odds are WAY in favor of a house going over the asking price if there’s as few as 3 offers. If you’re competing in this 2012 market you’re going to need to make an offer over asking.

Still, with every multiple offer scenario out there comes a story about somebody coming in under asking. Hilarious! Of course that’s the biggest piece, but there’s other silly things buyers do in this environment too. Asking the seller to pay your closing costs is almost as bad an idea as coming in under asking.

It’s really fairly easy to know if there’s going to be multiple offers on a place too. Simply ask, or have your agent ask, the listing agent 24 hours before the deadline how the activity has been. How many offers do you have? If the answer is over 25 you better get ready to write your strongest offer. Call again about an hour before the deadline and see if the agent can give you a solid number. One feeding frenzy I went through 2 weeks ago had 21 offers but when I called the agent about an hour before the deadline he told me he had 4 in hand and was expecting 2 or 3 more at best. Turned out he was wrong. Still, 6 offers invites you to swing for the fence in my mind as well.

If you’re writing an offer under asking in this environment your simply driving the overall price up, in my opinion. Most folks base their number on how many other offers are in play. Writing a silly offer like that just helps the seller get more money.

Oh, Canada

Mon, 26 Mar 2012 00:00:00 GMT

Oh, Canada

So our brethren north of us in Canada have come up with an interesting slant on real estate transparency. Seems there’s a government agency called the Canadian Competition Commission that’s taking action to force consumers private information that exists now on private MLS pages to be made public. Info such as the sellers phone number and property access information would thereby be made public and would appear on public sites like Trulia, Zillow and Redfin if they’re in those markets. Currently that type of information is kept off of the public versions of those sites for obvious privacy reasons.

There’s plenty of info that the Canadians are going to also make public that already is down here…like closed sales prices and mortgage information. It’s the inclusion of sellers contact info that’s interesting and sort of strange to me here. The seller’s phone number is included in listings so that agents can call and make appointments to show their homes. Often, these numbers are unpublished cell numbers and the inclusion of them to the general public that may often not even be local is sort of a troubling thing to me. I’m thinking I wouldn’t want my number published to anyone who was looking for a house to buy…or whatever else they might want. This is proprietary information that ought to stay that way if you ask me.

It’ll be interesting to see how this plays out and whether or not we see something like this around here in the future…in the interest of transparency. Here’s some more on this topic:

http://agbeat.com/real-estate-news-events/canadian-showdown-over-making-homeowners-information-public-in-mls/

Close Call

Wed, 21 Mar 2012 00:00:00 GMT

Well Pat and I took off for our annual trip to our favorite place on earth Maui on Sunday 3/21/12 out of the Oakland Airport at 8:45 am on Hawaiian Airlines About an hour into the flight over the ocean we start hearing this popping sound and then we start losing elevation and Pat got light headed. I did not really notice anything until the captain comes on the loud speaker and says that we have a situation and that 1 of the engines failed and that we will be turning around and will be making an emergency landing at SFO airport. Well Now I started getting concerned and Pat and I held hands with the rosary in between our hands. The entire plane became silent and it was very chilling the plane was flying fine and my ears were tuned into the engine and listening for the engine missing ect..ect...

We then got to SFO and when we were landing we could see that they had stopped all take offs there must have been at least a 100 planes waiting for us to land. I looked out of both sides of the plane windows and all you could see were fire engines and emergency Vehicles waiting on us to land as well. Well seeing all of this now I was freaked out. We landed and everyone started clapping and all was fine. You never know when your time will be up on this earth but that day was not our day. My Bother Charlie is a Chief over at San Bruno Fire and after all of this I Emailed him to let him no what happened and he e mails back " You are Kidding me I was on that call" They back up the S.F. Airport Fire Dept any time there is an issue with a plane landing so that was very weird and he had no idea we were on the plane

This Baby need's Our Help!

Sun, 04 Mar 2012 00:00:00 GMT

To all of my animal loving friends here in Tracy.....

Noah's Ark, my new non-profit venture to help sick and injured animals here in Tracy is getting off to a great start....unfortunately that means we have another dog in trouble. A 6 month old Chihuahua named "Penny" was surrendered by her owners today at the Manteca Shelter with a broken pelvis. A local animal rescue group is getting her to the vet for examination and care plan. Noah's Ark will be paying the bill for this poor little girls care, but we need the help of our animal loving friends here in Tracy. Your donation is tax deductable as a charitable donation, by making your check out to "Good Sam of Tracy" and in the memo line write Noah's Ark Foundation of Tracy.

For those of you not yet familiar with this organization you can read about it on our facebook page at NOAH'S ARK FOUNDATION OF TRACY. Our goal is to keep sick and injured animals that end up in the local shelters from being destroyed because of non-life threatening injures or illness. We work with various animal rescue organizations who rescue these animals "like Penny" from the clutches of the grim reaper and get them to a local vet who cares for them at a reduced cost to Noah's Ark. We pay the bill from your generous donations and ensure that they are placed in good foster care for re-habilitation then into the adoption system that places them in a new, loving, forever home. Our system works, and we are helping save animals one at a time from almost assured death!

Thank you for your time and consideration. If you would like to know more about Noah's Ark, you can contact me (Larry Hite at 209-740-7211) or email me at larryhite@sbcglobal.net....and please fell free to tell your friends about Noah's Ark and let them know about our immediate needs for Penny. You can also contact me at the above to make a donation...I'd be more than happy to pick it up from you!

Thanks again.............

Back on Market

Sat, 03 Mar 2012 00:00:00 GMT

This listing has came back on the market, Please call for your personal Showing.

209-833-7777 or 1-800-894-7282

1452 Whittingham Dr

Price: $229,000

Beds: 4

Baths: 3

Sq Ft: 2223

Here is a house just right for a large family. With formal living and dining and great bonus room off of entry. The family room is built for entertaining and the large kitchen great for the busy chef. Outside is a wonderful pool with spa and covered...

View this property >>

With Highest Regards,

Bill Barringer

Team Leader

The Barringer Team, Century 21 M&M and Associates

#1 Century 21 Company in the WORLD. SMARTER. BOLDER.FASTER.

Market Stats For Feb for Mt.House and Tracy California

Sat, 03 Mar 2012 00:00:00 GMT

The following information is from the local MLS database, as of March 1, 2012 and is compared to (Feb. 1, 2012). The market here is dominated by short sales, REO's and Flips. The short sales that have accepted offers show as Active Short Cont. This means that they are only accepting back up offers and are contingent on lender approval of the short sale. It is miss leading to the consumer as it looks like that there are more homes available than there really are. We have broken that down for you in our stats now. There are much fewer homes available to show that even the short sales are getting multiple offers. We have seen a handful of equity sellers and many "Flips". Interest rates remain low with 30 yr fixed at 3.90% and 15 year a 3.17%.
This is a healthy market now. There is a definite lack of good homes for sale. This is because there are many buyers grabbing them as they come out. Just call or e-mail for an hassle free appointment or to just talk about the market anytime. 1-800-894-7282 or sales@tracyhomes.com

Tracy, CA

ACTIVE Status

Total # of residential properties for sale in the city of Tracy: 92 (122)

# of REO (foreclosures): 16 (14)

# of Short Sales: 42 (65)

# of Short Contingent: 165 (162)

Average # of days on market: 93 (89)

The median price of all homes for sale in Tracy: $234,000 ($228,350)

The average price of all homes for sale in Tracy: $234,266($229,367)

Lowest priced home: 1br/612sqft. ft. /$65,000

Highest priced home: 6bd/4318sq. ft. /$620,000

PENDING Status

Number of properties currently under agreement: 249 (230)

# of REO: 41 (51)

# of Short Sales: 134 (122)

Average pending price: $226,244 ($226,301)

Median pending price: $226,244 (225,244)

SOLD Status

Residential property sold over previous 30 days: 107 homes (73)

REO’s sold in the last month: 27 (20)

Short sales sold in the last month: 43 (27)

Average sale price: $222,016 ($223,838)

Median sale price: $227,500 ($215,000)

High: 436K (5bd/3425sq. ft. home)

Low: 50,000 (1bd/706 sq. ft. home)

Mountain House, CA

ACTIVE Status

Total # of residential properties for sale in the city of Mountain House: 36 (37)

# of REO (foreclosures): 3 (3)

# of Short Sales: 8 (16)

# of Short Contingent: 42 (39)

Average # of days on market: 86 (93)

The median price of all homes for sale in Mountain House: $299,000($292,450)

The average price of all homes for sale in Mountain House: $285,223 ($292,450)

Lowest priced home: 2bd/1,262 sq. ft. /$115,000

Highest priced home: 6bd/3900 sq. ft. /$439,000

PENDING Status

Number of properties currently under agreement: 78 (70)

# of REO: 9 (6)

# of Short Sales: 51 (44)

Median pending price: $250,000 ($265,276)

Average pending price: 59,984 (264,099)

SOLD Status

Residential property sold over previous 30 days: 15 homes (19 homes)

REO’s sold in the last month: 2 (4)

Short sales sold in the last month: 6 (8)

Average sale price: $283,467($317,571)

Median sale price: $290,000 ($336,000)

High: 445,000 (6bd/4051sq. ft. homes

Low: $125,000(2bd/1262 sq. ft. home)

Writeing An Offer That Wins

Thu, 01 Mar 2012 00:00:00 GMT

Writing An Offer That Wins

In Tracy's current market it is completely run by bank owned homes and Short Sales. When a buyer wants to purchase a home there are numerous factors to consider. Here is a list of factors based on priority.

The Agent You Choose To Represent You Is Almost Everything. I know you are thinking, "Why is that so important?!" The answer is simple, you need an agent with many years of experience and one that is well known in the community of other agents. Most of all the business done by 20% of the agents in Tracy do 80% of the business. What this means for you, the buyer, is when you are represented by the Barringer Team; the other agent knows they are going to get to the closing table because they most likely have worked with us before.

Fewest Contingencies Win. We do all of our homework up front. The lender you choose also really plays a BIG role. We want to come in with the strongest offer possible. This means quick close, quick inspection time frames and high dollar deposits.

Lender. We primarily use Alex Alvarez with Wells Fargo. The advantages are great! First, we have been partners for over 17 years. This means he is accountable to us and you will get a good deal as well as good service. If the home is a bank owned home by Wells Fargo, then it will be looked at more favorably than other offers not using Wells Fargo as their financing. That's because you are using Wells as YOUR financing.

Being Fast. How fast and professional an offer and pre-approval letter is submitted means everything! The Barringer Team uses a system called Doc-U-Sign. The contract is signed and dated over the Internet and it is recognized by most banks as a legal contract even though it has no "wet signatures" on it.

Being First To Know. In the Tracy area many times we are made aware of listings before they hit the open market. Our sources are the banks themselves, bank listing agents and investors. All of whom we have working relationships with.

People listen When Buffett's Speaks

Wed, 29 Feb 2012 00:00:00 GMT

Buffett: 'Buy a house now'… Housing getting cheaper (more attractive)… Sjug pounds the table… France's limit on achievement… Wyoming plans for the End of America…

"Single-family homes are really cheap now, too," Warren Buffett said yesterday in a CNBC appearance. The other cheap asset class he previously referred to was equities. Buffett said he would personally buy "a couple hundred thousand" homes if it were practical. And if you hold houses for the long term and purchased at today's low rates, he says housing is even better than stocks. Buffett advises taking out a 30-year mortgage and refinancing if rates go down.

Buffett is bullish on housing even after saying he was "dead wrong" about a housing recovery occurring last year. From his annual letter…

Last year, I told you that "a housing recovery will probably begin within a year or so." I was dead wrong. We have five businesses whose results are significantly influenced by housing activity. The connection is direct at Clayton Homes, which is the largest producer of homes in the country, accounting for about 7% of those constructed during 2011.

Additionally, Acme Brick, Shaw (carpet), Johns Manville (insulation) and MiTek (building products, primarily connector plates used in roofing) are all materially affected by construction activity. In aggregate, our five housing-related companies had pre-tax profits of $513 million in 2011. That's similar to 2010 but down from $1.8 billion in 2006.

Housing will come back – you can be sure of that. Over time, the number of housing units necessarily matches the number of households (after allowing for a normal level of vacancies). For a period of years prior to 2008, however, America added more housing units than households. Inevitably, we ended up with far too many units and the bubble popped with a violence that shook the entire economy. That created still another problem for housing: Early in a recession, household formations slow, and in 2009 the decrease was dramatic.

That devastating supply/demand equation is now reversed: Every day we are creating more households than housing units.

The latest data from the Standard & Poor's/Case-Shiller home-price index (the bellwether) shows housing prices are still falling… Home prices fell 0.5% in December – the fourth down month in a row. On a year-over-year basis, home prices fell 3.99%, worse than the 3.65% expected. Of the 20 cities tracked in the index, only Detroit showed a year-over-year gain. Meanwhile, prices in Atlanta, Las Vegas, Seattle, and Tampa dropped to their lowest point since the housing crisis began. Overall, home prices have fallen 34% since the crisis, down to 2002 levels.

While prices are still falling, sales are increasing. The index measuring pending home sales increased 2% in January, besting expectations and pushing the index to its highest point since April 2010, according to the National Association of Realtors.

And yes… despite falling prices, Steve Sjuggerud is every bit as bullish on housing as Warren Buffett. Steve wrote a February 21 DailyWealth essay called "This Is the Moment I Live For as an Investor." Steve's been excited about housing for months. He told readers, "I'm more convinced of what I'm saying here than I have been about any other investment in my two decades of studying investments." He continues…

The basic story is that housing is an incredible value right this moment: With mortgage rates at record lows TODAY (at 3.87%) and with a record "bust" in home prices, housing is more affordable than ever. PLUS, we're at the "puke" point – where banks are giving up properties at any price, just to get rid of 'em. PLUS, the government is getting in on the act, trying to help.

In addition to his DailyWealth writings, Steve incorporated his housing commentary in the most recent issue of his flagship advisory, True Wealth. Steve launched True Wealth based on his belief that subscribers can make big returns without taking big risks. Recently, Steve released a series of reports on investments that can give you incredible gains… but come with virtually no risk of going down. Click here for the details.

F.H.A. 203 K Rehab Loan

Tue, 28 Feb 2012 00:00:00 GMT

Many people either own a house that needs fixing up, or are thinking about purchasing a home which is affordable largely because it needs extensive repairs. Home repairs can be quite costly, however, and may not be affordable for those with less than ample budgets. There are also instances where the ability to pay back a loan on a house is not an issue, but a lender will still not allow a purchase for a variety of other reasons. This is where a 203k rehab loan can be the key to allowing you to own the home you have always dreamed of owning.

203k loans are government-based loans offered in situations where an investment would be considered high risk by the lender. The FHA's 203k rehab loan was created to provide homeowners with the resources to allow them to turn a damaged property into a livable home. From simple repairs to more drastic overhauls of a home, these loans are arguably the most reliable means of turning a questionable home into a sound investment, not to mention a sound dwelling. Generally, 203k loans are used to service homes in need of slight repairs, but they can be used for more involved improvements, and they cover the use of licensed contractors in the event that the loan borrower cannot complete the project without help.

The 203k rehab loans permit a wide variety of repairs to the home and surrounding area, but there are notable exceptions. Some of the repairs and work not permitted by these loans include landscaping and yard work, major remodeling, or fixing structural damage. It generally allows for more subtle repairs such as painting, addition or removal or doors, minor repairs or enhancements to kitchens or bathrooms, plumbing and electrical work and flooring, among many others. There are special terms and requirements that also come with each loan, including:

The property must be the borrower’s own
Work needs to be professional, and completed in a six month time frame
The property must not be vacated for more than a month
Depending on the situation, the borrower must possess a permit for the work done if one is required.

Despite some of the terms and limitations set forth by the loan, it is arguably the most helpful method for getting the necessary work done. I can testify to this program because we did one with my son and it is very good 1 of the drawbacks is waiting for the contractor to sign off on the projects because you are forced to wait for the FHA certified project manager to sign off so you can draw more money for the next stage. Call or email we will be happy to share what we know about this program. 209-833-7777 or sales@tracyhomes.com ask for Bill.

Back On The Market

Sat, 25 Feb 2012 00:00:00 GMT

This listing just came back on the Market last night. It is super clean and is perfect for the 1st time buyer or investor it is turnkey you can move in right away or rent out. Rent would be 850 to 1,000 a month. Hurry this one will go quick. Not a short sale!

3786 Steve Lillie Cir

Price: $119,000

Beds: 4

Baths: 2

Sq Ft: 1475

Here is the perfect starter home or great investment. With 4 bedrooms and large yard just right for any family. Single story with formal living room and Hardwood flooring in dining and hall. Don't miss the back yard with large shed for storage and k...

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With Highest Regards,

Bill Barringer

Team Leader

The Barringer Team, Century 21 M&M and Associates

#1 Century 21 Company in the WORLD. SMARTER. BOLDER.FASTER.

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Biting The Bullet-Short Sales

Fri, 24 Feb 2012 00:00:00 GMT

Biting The Bullet-Short Sales

You know what? Honestly, I really hate short sales. Since they sort of arrived on the scene around here they’ve been a massive pain in the posterior if you ask me. I’m not alone in that estimation either. A short sale (a oximoron if ever there was one) occurs when a homeowner who owes more on his/her loans (and often loans) and puts their home on the market attempting to persuade their lender(s) into forgiving some of their debt to allow the place to be sold. In the past 5 years or so it’s sort of appeared to me that lenders seem to want to torture buyers and agents who are attempting to actually buy one of these places.

Buying a short sale is not for the faint of heart…and certainly not for somebody in a hurry either! They take forever and often it takes months just to get a lender to look at the file. One agent I know spent months just trying to get a return phone call from the relevant person inside a bank holding a loan. I’m not talking about actually negotiating the short sale, months just getting somebody to make an initial contact with a decision maker. Another agent I know was told any offers on a short sale with one particular lender had to be faxed (and faxed only!) to one particular fax machine…that was always busy. Busy at 2:00AM, Busy for 3 weeks straight. If you’re looking for personal growth in the area of patience, try negotiating a short sale. It’s a land where most rules of common sense get redefined.

Historically, short sales are those listings you see that have been on the market forever. the ones with the 3 digit days on market numbers. Not in 2012 though! In yet another sign of the turning of the real estate market so far this year, short sales are not only ratifying early in their listing life…they’re getting multiple offers! You really have no idea how amazing that is to me! Multiple offers on a short sale? Unheard of! The irony is that, now, people are waiting in line…to wait in line again! We’ll now compete for the opportunity to wait for the lenders to take 4 months to look at the file.

I don’t know…I hear that they’re actually getting better at this. I hope that’s true! Keep an eye on the escrows of these short sales. It’s going to be interesting to see how long they take to matriculate in 2012. You have to be trained like we are to work these Short Sales because there are allot of agents who do not know what they are doing so you have to be on the look out when placing an offer on a Short Sale for a client because you don't want to be involved with an agent who is not a CDPE " A Certified Distressed Property Expert" The Barringer Team is a certified CDPE.