Finding just the right beach home along the silvery sands of Oceanside, CA isn’t as hard as you think.  Homes range in the “West of Interstate 5″ area from as low as $400,000, and top out with actual beach front properties in the $5 million range.  There’s something for everyone who loves the surf and the sand.

Contact us today to get any questions answered, or to make an appointment to preview the Oceanside lifestyle here in beautiful San Diego.  We can be reached at 760-802-9713, or just click on the Contact Us button to send us an email.

Home Prices in San Diego

San Diego – April 29, 2010

The newest Case-Shiller Index is out, and it seems to be good news for all San Diego homeowners.

The Case-Shiller index is maintained by Standard and Poors, and is generally regarded as one of the best home value reports in the nation. Although changes have recently been made to the report to reflect the seasonal fluctuations, this month’s report indicates that San Diego is among the few cities that have shown gains in housing prices.

Home prices rose 0.9% in February.   Sound small?  Well this increase is up 7.9% from last year, and compared with the other twenty cities measured in the report, shows that San Diego housing prices continue an upward, steady progression.

What was the other big news in this report?  Well, home sales in the lower segment of the market have been brisk most of the year, with investors and first time home buyers snapping up homes to take advantage of the lower prices and great interest rates.  But the news this month is that homes priced above $460,000 finally began to increase as well.  The increase in value was a similar 0.9% increase, but this marks the first time in over 4 years that these homes have begun to show life.

Contact us if you want more detailed information.

$8000 Buyer's Tax Credit Is Expiring

April 27, 2010

$8000 Buyers Tax Credit Is Expiring

On April 30th, with a couple of exceptions for those who have served overseas in 2009 (military and civil service), the $8000 Buyers Tax Credit will expire for once and for all.  This has been a boon to the real estate market in terms of sales volume, with over 47% of all new homes sales being made by first time homebuyers utilizing the credit to buy a house.

What effect will the expiration of the Tax Credit have on home pricing?

Can you say “downward pressure?”  In these last days of the tax credit I have been working with buyers who know that they have $8000 more to play with in terms of making an offer without affecting their bottom line.  This has resulted in offers that are higher, and those higher offers will be off the table in four days.  The result will be a weakening demand by first time home buyers, and that weakening demand will result in home prices in San Diego and other parts of the country declining for the time being.

If you happen to be in the military, then the $8000 Buyers’ Tax Credit will not expire for one more year, and if you fall into this category, please contact us now so that we can educate you about how to take advantage of this continuing benefit to our service men and women.

I am updating this post that I first published in 2009. Since that time various attempts by the government to step in and fix the mortgage situation has resulted in what appears to me to be an abject failure. Borrowers who were deceived continue to be discounted. Borrowers who tried to take advantage of the system find themselves the recipient of one after the other bailout attempt. Folks who need answers continue to get a flood of opinions, none of which will solve the problem, but all of which continue to extend the pain.

Why You Should Fear a Short Sale

If you’ve found yourself in peril of losing your home, and then discovered yourself in a conversation about “short selling” your home, then pay attention to this!

In a nutshell, a short sale is where the owner of a home goes to their bank and says in effect “we are a hardship case, and we can no longer pay our mortgage.” It is usually the case that the amount stilled owed by the owner is actually much more than what the home is worth. In this case, the owner is asking the bank to let them try to sell the house for less money than they owe the bank (thus the term “short” sale….because you are going to fall short of paying your whole mortgage), and in doing so the owner is supposed to walk away without having to undergo the pain and damage of a foreclosure.

Let’s take an example. A couple bought a home in San Diego for $450,000 two years ago. Mortgaged to the hilt, they financed 100% of the sale, and they currently have a first trust deed and of $360,000, and a second trust deed of $90,000. The decline in prices has resulted in the home being worth only $350,000 now, less than 80% of the price they paid. Their rates are rising, and they can no longer pay the mortgage. They are in trouble financially, and without equity in the home, are unable to refinance and move on with their lives.

So they go to the bank and ask for a short sale. The bank says “okay, but keep paying your mortgage.” Then the owner places the home on the market for $350,000, and that home is marketed “pending lender approval.” Any offers that come in on the property need to be submitted to the bank. Remember, the $350,000 IS NOT THE PRICE THE BANK HAS AGREED TO SELL AT!!! Rather, it is the price the Realtor has told the bank the home MIGHT sell at, and the only thing the bank has agreed to is to review any offers and possibly accept them.

This is why you should fear the short sale, both if you are an owner in dire straits, or a buyer who is really looking to purchase. Both parties are at the mercy of the bank, and the bank’s motivation is not to sell at $350,000. Rather it is to keep the owner paying their mortgage, and thus keep the loan alive. If the bank can keep the owner paying, they forestall foreclosure and the loss on the loan for perhaps enough time for the market to gather itself up and make the home worth more. It’s not going to be worth enough to pay the mortgage, but if may be long enough to make the bank’s loss less.

Now, here’s the really bad news. Let’s say you go along with the bank, list your home as a short sale, and then some six to eight months later sell the home. Are you off free and clear? The answer is a double whammy NO. First, during these six to eight months you have been paying the mortgage, digging deeper into your reserves to pay the bank. You’ll never get a return on your money. And next, what about your credit? Isn’t a short sale supposed to be way better financially than going through a foreclosure? Isn’t it?

Well, according to Fair Isaac (the folks who bring you the FICO score), a short sale can cause the immediate loss of 70 to 200 points on your credit score, and this stigma will last on your credit from 2 to 3 years. That essentially means that you are persona non grata in the financial world. What happens if you get foreclosed on? Well, your FICO score will go down 70 to 150 points, and you’ll have the stigma of this bad credit for 3 to 5 years. Neither result, either from a short sale or a foreclosure, will be pretty to look at financially, but the difference between the two really needs to be looked at without emotion. When you do that, it is clear to me that many more people should be walking away from their homes in a foreclosure, and not burying themselves in the short sale process.

Here’s what FICO has to say:

“The common alternatives to foreclosure, such as short sales, and deeds-in-lieu of foreclosure are all “not paid as agreed” accounts, and considered the same by your FICO® score. This is not to say that these may not be better options for you from a financial perspective, just that they will be considered no better or worse for your FICO score. If you are considering bankruptcy as an alternative to foreclosure, that may have a greater impact to your FICO score. While a foreclosure is a single account that you default on, declaring bankruptcy has the opportunity to affect multiple accounts and therefore has potential to have a greater negative impact on your FICO score.”

Fear a short sale. You may want to talk to your financial advisor first about any decision you are going to make that will adversely affect your credit, and certainly if you are in jeopardy of losing your home. But don’t take a cursory look. Look long and hard at all your options. You can’t change the fact that losing your home is going to be painful. You can’t change the fact that losing your home will be stressful and perhaps an embarrassment. You can, however, decide which option really affects you now and in the future, weigh those options, and at least keep the financial damage at a minimum.