House prices nearing affordability limits in many markets

 News, Pacific Beach - Mission Beach
May 202013
 
House prices nearing affordability limits in many markets

Thanks to record low mortgage interest rates, monthly payment affordability is very high. In fact, it costs the same on a monthly payment basis to own a house in Orange County as it did in 1989 (see chart below). This allows buyers to raise their bids on the limited inventory available. This is highly desirable for the banks who want to recover as much as they can on their bubble-era legacy loans. Existing homeowners are not complaining. There is a limit to how much buyers can raise their bids. Gone are the days of liar loans, so now borrowers much [Read More...]

Foreclosures are still the best deals. Find one in your target neighborhood today!

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May 192013
 
Foreclosures are still the best deals. Find one in your target neighborhood today!

If you are searching for a home in today’s market, you know how difficult it is to find the right property. Inventory is extraordinarily low, and there is little sign that the banks are going to release more properties to the market soon. There is still a tremendous inventory of distressed properties, and our foreclosure search too can prove it. This tool is useful for more than just indulging idle curiosity. If you are searching for your next home, this tool can help you find properties before they hit the MLS. With our fundamental value reports, we can help you [Read More...]

Before you make an offer, read this report!

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May 182013
 
Before you make an offer, read this report!

Don’t bid on a house until you see our report! It’s that important. Are house prices inflated or undervalued? What should house prices be in your search area? Are the neighborhoods and cities you are looking in overvalued? Are you missing opportunities in nearby communities? Our report has those answers. Are you better off renting instead of buying? Will your cost of ownership be more or less than a comparable rental? Is it currently cheaper to own or rent? Has it always been that way? Our report has those answers too. Save thousands on your next home. Be smarter than [Read More...]

The housing bears are rightfully frustrated

 News, Point Loma - Ocean Beach
May 172013
 
The housing bears are rightfully frustrated

House prices are rising rapidly, and the conditions creating this rally will persist for the foreseeable future. Prices will continue to rise until affordability becomes a limitation, or cloud inventory makes its way to the market, and even then prices will continue to rise, just less rapidly than they are today. As long as prices are financeable and supply is limited, buyers will bid up prices on the available housing inventory and prices will keep going up. This sounds like the ideal set of circumstances for continued price appreciation, so why are the housing bears still roaring? Because its a [Read More...]

Mortgage lending standards remain prudently restrictive

 News, Northpark - City Heights - University Heights
May 162013
 
Mortgage lending standards remain prudently restrictive

realtors, homebuilders and others who profit on real estate transactions hold the false belief that lenders are holding back the market with tight lending standards. It’s an easy position to hold for those who have no risk of loss when loans go bad. The reality is that lenders are not willing to make bad loans anymore because if the do, they will lose money — which is how it should be. Lenders are supposed to be the adults looking over real estate transactions. After all, it’s mostly their money being used to fund the purchase. During the housing bubble lenders [Read More...]

Irvine’s Great Park boondoggle blows $200 million

 Hillcrest - Mission Hill - Banker's Hill, News
May 152013
 
Irvine's Great Park boondoggle blows $200 million

What happens when you give politicians $200 million with no accountability? They blow it. So it was with the money the City of Irvine extracted from developers to create the Great Park. So far, the City has brought in about $250 million, yet only about 15% of the park is developed, and what’s out there doesn’t look like $250 million worth of facilities. Most of the money was simply wasted. Irvine taxpayers paid for a park and all they got to show for it is a balloon, over-hyped and over-priced conceptual plans, and a giant pile of runway rubble. Dream [Read More...]

The federal reserve is inflating a bubble in the apartment market

 Downtown, News
May 142013
 
The federal reserve is inflating a bubble in the apartment market

Financial bubbles are inflated by investors who pile into an asset class with flawed assumptions. In most cases, these investors have unrealistic expectations for future appreciation and wouldn’t want to own the asset based on its cashflow alone. Such is the case with stocks, bonds, land, houses, tulips, and even gold. At some point, investors question their original assumptions on appreciation and start to sell. Of course, this causes any appreciation to stop, and even more speculators decide to exit. Further selling causes prices to fall which prompts even more selling that culminates in complete market capitulation and a crash [Read More...]

What would Watt do as the new head of the GSEs?

 Mission Valley, Mission Hills, Tierrasanta, News
May 132013
 
What would Watt do as the new head of the GSEs?

What would Jesus do if he were in charge of the GSEs? “And Jesus went into the temple of God, and cast out all of them who sold and bought in the temple, and overthrew the tables of the moneychangers, and the seats of them that sold doves, And said unto them, It is written, My house shall be called the house of prayer; but ye have made it a den of thieves.”—Matthew 21:12-13 So what will Representative Mel Watt do if he is put in charge of the GSEs? Will he make it a den of thieves by reducing principal [Read More...]

Are you missing that bargain home in a great neighborhood? Don’t miss out on a good deal.

 Advertisement, News
May 122013
 
Are you missing that bargain home in a great neighborhood? Don't miss out on a good deal.

Don’t bid on a house until you see our report! It’s that important. Are house prices inflated or undervalued? What should house prices be in your search area? Are the neighborhoods and cities you are looking in overvalued? Are you missing opportunities in nearby communities? Our report has those answers. Are you better off renting instead of buying? Will your cost of ownership be more or less than a comparable rental? Is it currently cheaper to own or rent? Has it always been that way? Our report has those answers too. Save thousands on your next home. Be smarter than [Read More...]

Frustrated by low inventory? Find tomorrow’s listings today with our exclusive pre-MLS search tool.

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May 112013
 
Frustrated by low inventory? Find tomorrow's listings today with our exclusive pre-MLS search tool.

If you are searching for a home in today’s market, you know how difficult it is to find the right property. Inventory is extraordinarily low, and there is little sign that the banks are going to release more properties to the market soon. There is still a tremendous inventory of distressed properties, and our foreclosure search too can prove it. This tool is useful for more than just indulging idle curiosity. If you are searching for your next home, this tool can help you find properties before they hit the MLS. With our fundamental value reports, we can help you [Read More...]

Do pocket listings enrich realtors at the seller’s expense?

 News, Vista
May 102013
 
Do pocket listings enrich realtors at the seller's expense?

  A pocket listing is a property kept off the MLS for exclusive showing to select buyers. Most often pocket listings are used by agents who want to double-end the deal and make double the commission. In that scenario, the agent is ignoring the inherent conflict of interest in dual agency to make more money. Typically, this arrangement favors the buyer over the seller. The buyer participates to get a good deal, the agent participates to get a double commission and a quick sale, and the seller… well, he gets screwed. Secret ‘Pocket Listings’ Return in Hot Housing Markets By [Read More...]

Americans are increasingly foolish with debt

 News, Solana Beach
May 092013
 
Americans are increasingly foolish with debt

After 30 years of falling interest rates, Americans have become addicted to cheap credit and personal Ponzi schemes. People have learned they can take on large debts, consolidate them at lower and lower interest rates, and service that debt with a portion of their income. It’s a bit like learning to live with a lamprey slowly sucking your financial juices. Often it’s not enough to kill, so it’s a parasite people learn to live with. Oftentimes when people get in trouble with debt, they stop using it. As Jesus would say, “sin no more.” Through falling interest rates, loan consolidations, [Read More...]

Expect years of low sales volumes in residential real estate

 News, Santee
May 082013
 
Expect years of low sales volumes in residential real estate

At this point we can be certain that banks are going to avoid or delay foreclosure or short sale until prices rise so they don’t have to lose money on the sale. They have no choice. With banks still exposed to $1 trillion in unsecured mortgage debt, they simply can’t take the losses that are coming. No matter what else happens in the market, unless the banks are forced to change their policies by the government regulators or the federal reserve (a very unlikely event), lenders will continue to kick the can with loan modifications and suspend homes in cloud [Read More...]

Large down payments provide stability to the housing market

 News, San Marcos North
May 072013
 
Large down payments provide stability to the housing market

Down payments are the bedrock of the housing market. Large down payments preserve home ownership, reduce volatility in the market, and reduce the risk to our financial system. The only people who oppose them are realtors and originate-to-sell lenders who see down payments as an impediment to profits and left-wing housing advocates who see down payments as a barrier to putting unqualified borrowers into houses. Down payments preserve home ownership because people who’ve put down large down payments rarely default. In purely economics terms, people shouldn’t consider sunk costs like down payments in their decision making. However, homeowners do. People [Read More...]

Renter’s guide to preparing for home ownership

 News, Poway
May 062013
 
Renter's guide to preparing for home ownership

I have been accused of being “old school” because I never embraced the innovations in real estate finance that inflated the housing bubble. In 2006 preparing for home ownership only required finding a house and signing a few loan documents. It’s a lot more difficult today. Now the old rules are back. Buyers today have to save for a down payment and make sure the payments are affordable. Since so many forgot the old ways, I felt it necessary to revisit these old methods to educate the next generation — and perhaps reeducate the old one. Adjusting your finances People [Read More...]

Other buyers use our reports to save tens of thousands of dollars. Don’t get left behind.

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May 052013
 
Other buyers use our reports to save tens of thousands of dollars. Don't get left behind.

Don’t bid on a house until you see our report! It’s that important. Are house prices inflated or undervalued? What should house prices be in your search area? Are the neighborhoods and cities you are looking in overvalued? Are you missing opportunities in nearby communities? Our report has those answers. Are you better off renting instead of buying? Will your cost of ownership be more or less than a comparable rental? Is it currently cheaper to own or rent? Has it always been that way? Our report has those answers too. Save thousands on your next home. Be smarter than [Read More...]

Today’s foreclosures are tomorrow’s MLS listings. Find tomorrow’s deals now!

 Advertisement
May 042013
 
Today's foreclosures are tomorrow's MLS listings. Find tomorrow's deals now!

If you are searching for a home in today’s market, you know how difficult it is to find the right property. Inventory is extraordinarily low, and there is little sign that the banks are going to release more properties to the market soon. There is still a tremendous inventory of distressed properties, and our foreclosure search too can prove it. This tool is useful for more than just indulging idle curiosity. If you are searching for your next home, this tool can help you find properties before they hit the MLS. With our fundamental value reports, we can help you [Read More...]

With house prices rising, the value of lots and raw land is skyrocketing

 News, Oceanside East
May 032013
 
With house prices rising, the value of lots and raw land is skyrocketing

The valuation of land used for residential housing is mysterious and often misunderstood. The valuation of lots and raw land requires a detailed knowledge of construction and marketing costs as well as a good estimate of the sales price of the final product: a residential housing unit. In short, the value of a lot is the total revenue (sales price of the home) minus the costs of production and the necessary profit. Land value is a residual calculation. The value of a piece of land is whatever is “left over” after all the other costs of production and profits are [Read More...]

Loan modification can-kicking going to extremes

 News, Oceanside West
May 022013
 
Loan modification can-kicking going to extremes

The mainstream media housing market cheerleaders have been touting the declining delinquency rates as a sign of market health. As I recently pointed out, contrary to media spin, mortgage delinquencies are trending higher. We know that lenders don’t want to foreclose and recognize losses, particularly since banks are still exposed to $1 trillion in unsecured mortgage debt. If they were forced to write down the losses on their bad loans or approve too many short sales, the losses would drive them out of business — either that, or we would have another massive government bailout to deal with. The only [Read More...]

No escape velocity as depleted inventory pummels home sales

 La Jolla, News
May 012013
 
No escape velocity as depleted inventory pummels home sales

Typically, January is the slowest month of the year for real estate sales. Sales volume rises each month through July or August when it peaks as buyers rush to get into homes before their children start a new school year. When sales volumes decline on a monthly basis during the first half of the year, it’s often a troubling sign for the real estate market. Sales volumes declined in March, and it is a sign of a problem in the housing market: a lack of inventory. Why Home Sales Stalled in March By Nick Timiraos — April 22, 2013, 11:46 [Read More...]

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