From the JoeBurnsBlog

Normal Real Estate Market Numbers in Marin County, CA

Joe Burns (Frank Howard Allen - Sausalito) — Wed, 20 Jan 2010 16:42:02 -0600

Hey, we have a normal real estate market. Final closing numbers for Marin County real estate sales in December and 4^th quarter 2009 show a very stable and consistent market. Volume is where it should be and prices held steady for the most part.

Now, for those who expect an immediate financial return on their personal residence, the Marin market may still seem depressed. There are still too many real estate agents in the market so it may seem that business is slow, but with the highest volume in over 2 yrs and 30% higher than last year, the fourth quarter of 2009 was quite normal.

As you know, I use MLS Average Price and Price Per SF statistics. Yeah, I know, they don't tell the whole story, but for market comparisons I think they are adequate for the time and effort. The total Marin market in December 2009 closed 220 Single Family Residences (SFR)/Condo at $881k average price and $428 average price/sf. This was up slightly from November 2009 and fairly consistent with the past 3 mos average. The Q4'09 total was 663 units at $870k and $422/sf compared to Q4'08 at 456 units, $875k and $434/sf. The difference in volume between 08 and 09 was completely SFR; condo sales for both quarters were similar.

Comparing Q3'09 to Q4'09, single family average pricing in 4^thquarter was up in Sausalito($1.355m), Mill Valley($1.168m), Tiburon/Belvedere($2.664m) and San Rafael($826k); and down in Corte Madera/Larkspur($1.101m), Ross Valley/Fairfax($1.157m) and Novato($641k).

Contact me directly for a more precise breakdown of each community and its pricing history.

Twenty Ten seems to be off to a very slow start of what has been an invigorated market. I believe the next two months will give us a great snap shot of what is in store for this year. After 10 yrs of steep inclines and 2 years of steep declines we have become accustom to volatile pricing. However, I would be perfectly happy with modest volume and -5% to 5% value increase.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Buy Then Bail... Go Straight to Jail (Do Not Pass Go)

Joe Burns (Frank Howard Allen - Sausalito) — Tue, 17 Nov 2009 13:50:30 -0600

A love this post from a Bay Area mortgage lender, Janet Guilbault. More than any question I get from new contacts is, 'how do I beat the system?'.

Via Janet Guilbault California Mortgage Banker/Broker:

As a mortgage person in the current wild and wacky real estate market, I sometimes get clients who want to buy and bail. So what's a buy and bail?

The call goes something like this:

"Hello, lovely mortgage person? This is Babs ( Buy and Bail Soon). My house is worth $175,000, but I owe $300,000. Since I will never be able to repay this, I am going to walk away."

"But first, most lovely mortgage person, you will get me a loan to buy a house just like mine, which is only down the street, and selling for $175,000...?"

"You can get me this loan while my credit is still good, before I walk away. My payment will go way down, and we can just tell the bank we are going to RENT my old house."

"Wow. Am I brilliant or WHAT? Buy the same house cheaper, bail out of the old one afterwards"

(I love the way they believe they are the first person EVER to think of this)

Okay, this has created a new mortgagespeak term: The departing house. And there are RULES in place so banks don't get stuck in schemes like this:

If your home is in a negative equity position, the lender would

•1) Force you to qualify for the new home without using the rental income from the old home

•2) If the loan on the old home is adjustable, the underwriter has the ability to caluclate the payment on that house at the highest possible amount after adjustment (even if the loan is not adjusting in the near future)

•3) If there is an equityline on the old house, the payment will be calculated at 1% of the amount of the equity line....even if the real payment is far less.

Even if these stiff requirements are met, without at least 25% to 30% equity in the old house, most lenders will decline the loan.

Why would they do that even if people really do plan to rent their departing house out and can prove it????

Because in the current lending environment, everyone is considered guilty (whether proven innocent or not).

Everyone is considered a potential foreclosure. And can we blame them?

Written by Janet Guilbault, Mortgage Banker/Broker Based Out of the San Francisco Bay Area

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Live on Top of the World: A San Francisco View Like You Have Never Seen Before

Joe Burns (Frank Howard Allen - Sausalito) — Tue, 24 Nov 2009 17:24:06 -0600

Next time you're sitting around the office playing that famous real estate game, "Name The Best Place to Live", consider this incredible San Francisco view property.

Known as Wolfback Ridge in Marin County, this property is uniquely positioned atop a peaked ridge with views of San Francisco, the Pacific Ocean, Angel Island and Golden Gate Bridge. Adjacent to the Golden Gate National Park, the recreational opportunities abound. Sitting at the end of a private road, this property offers quiet serenity yet quick access to Highway 101 and San Francisco.

Here is the front yard during sunrise.

The side yard.

The back yard.

The other side yard.

How many people can say they look out one window and see Angel Island, Mt Diablo and the East Bay, then look out their front window and see the entire City of San Francisco, (including the south bay beyond the peninsula), then the Golden Gate Bridge out another window and finally, the Pacific Ocean and Fort Cronkhite Valley out another window? Let me tell you how many people, well, just one and that one could be you.

This estate property is already plumbed with utilities and has a natural build pad. Wolfback Ridge is an exclusive private community high above Sausalito, CA and offers some of the best views in the Bay Area. All of the above pics come from Lot 4. Additional lots are available as well, prices range from $1,250,000 to $1,950,000. Build your dream home high on the hill that beckons the wonderment from viewers below, "that must be the best spot in Northern California."

Brokers, if you have clients that want/need the very best, tell them about this property. Contact me for any specifics.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Marin County Home Sales for October

Joe Burns (Frank Howard Allen - Sausalito) — Sat, 14 Nov 2009 16:19:12 -0600

Average home prices for all of Marin County were down slightly in October 2009, from the previous month. October average was $883,000 on 225 units and an average price/sf of $417, for all of Marin County, both single family residences and condominiums. The average price was down 5.5% from the $934,000 of October 2008; price/sf down 7% year-over-year.

Sausalito, Mill Valley, Corte Madera and Larkspur pricing was up considerably in October from the prior quarter in single family residence sales. Ross Valley was up just slightly in average sales price, yet down in price/sf, while San Rafael was up in both categories and Novato was relatively flat. Volume across the board was up in October over any month this summer. The overall condo market for Marin County was down slightly from September in average pricing, $376,000 from $386,000.

For a specific breakdown of all Marin County communities, contact me at the information below.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Median Pricing Reports Tell Us Nothing About VALUES

Joe Burns (Frank Howard Allen - Sausalito) — Sat, 24 Oct 2009 15:45:44 -0500

Reporting just median or average home sales is a disservice to the reader because those numbers don't provide the information the reader is seeking. People want to know the AVERAGE VALUE of properties, not the average price. The entire purpose of all these real estate statistics is to let the person know if VALUES are going up or down.

I remember once looking at some old San Francisco newspapers and there were articles on the sales of real estate for a period of time, but they were all totals, like, "last quarter SF homes sold totaled $1,500,000." I couldn't find average price per property anywhere. I imagine at some point in history someone said, "Hey, we should divide the total real estate sold by the number of properties sold, so we really know what values are doing." And hence, the Average Price was born.

Fast forward to 2009, where home prices vary greatly; in our community for example from $299,000 for a 1bd condo to $28,500,000 for bay front estate on Belvedere Island. Do we really want use a median or average of those two homes to determine current real estate values in Marin County? I would say not.

Price and Value are Different Animals. Value is the price of a product. Without qualifying the product, you're only reporting half the equation. What people really want to know is how much home does that median or average price buy. For that, we need to add another qualifier.

I have found the easiest additional qualifier is price per square foot. This is by far not the most accurate for determining values, but it is a quick and easy step in the right direction. A more informative approach would be to do a cost per square foot in each bed/bath category. Then maybe add in average lots sizes and you are now seeing what the average price will purchase as far as product.

Currently, many real estate economists agree that the $8000 tax credit and low conforming loan rates are having a positive effect on the market. I would imagine the $8k tax credit is a great motivator for the purchaser of a $299,000 condo, but not so much for the purchaser of a $20 million estate. So, more homes in the lower price bracket are selling, bringing down the median price. What if however, that declining price was buying much smaller homes than the previous period? Then, in reality prices would be falling, but value of the real estate would be increasing. And, even if they aren't opposing, the percentage of incline or decline of median price vs price per sf will tell you something as well.

If you are providing market stats on your blog sites, may I respectively suggest taking those stats a step further and include an additional qualifier to help the reader see what is really happening to real estate VALUES. If enough of us explain the market with a little more detail, maybe the media will catch on.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Marin Bike Rides: Tiburon Loop-a -Dup (from Sausalito)

Joe Burns (Frank Howard Allen - Sausalito) — Sat, 24 Oct 2009 16:25:13 -0500

The Tiburon Loop a Dup is my favorite weekend ride that doesn't involve a mountain. You know those mornings when you really don't feel like riding, maybe it is too cold, you're a little hung over, or your favorite socks are in the laundry. On those mornings, Loop a Dup is perfect. At 1 hour, 45 mins, from Sausalito, this road ride has just a wee bit of climb, few lights, incredible Bay Area views, and a great coffee joint on route.

From Sausalito, hop on the Mill Valley Sausalito bike path and take up to E. Blithedale, turn left on E. Blithedale and then your next right at the light which is Camino Alto. A quick and steady couple mile climb to the top, then down the hill, which turns into Corte Madera Ave, to the light. This would be a screaming downhill, but usually a car or two keeps you at 30mph. You're now in downtown Corte Madera. Turn Right at the first light you reach which is Redwood Dr and as it bends to the right it turns into Tamalpais Dr. This road will take you all the way back to Hwy 101, cross over the highway to the dead end, turn right, which we all call Paradise Rd.( It is really San Clemente, and turns into Paradise down the road further).

Continue on Paradise Rd past Paradise Market, past the park, past the school and you will start to see San Quentin Prison across the water. Don't pick up any hitchhikers that are dripping wet. As you climb up a small roller you soon leave Corte Madera and enter Tiburon. The price of dirt underneath you just doubled. Still on Paradise Dr, you will continue on a quiet and rough two lane that picks up some great East Bay and Richmond Bridge views. After a couple miles you will come to a Yield intersection of Paradise and Trestle Glen, keep on Paradise, but nod at Trestle Glen as you will meet again.

A few more miles of roll and rough road you will eventually pass the Romberg Center which is an education compound for San Francisco State. Next up will be some views of Angel Island, then as you drop into Tiburon great views of the Golden Gate Bridge and San Francisco. As you enter the roundabout you will have a couple decisions: proceed forward, proceed to the left on Main St or proceed to Caffe Acri right at the corner and have a coffee drink while watching the Ferries and incredible view.

As this is a quick ride, I suggest proceeding straight on Tiburon Blvd through a couple stop signs until you can see the #10 bike trail to your left. If you don't pick up the trail there, you can at San Rafael Ave, which is also the exit from the Main St decision you had back at the roundabout. From the bike trail you will see the Tennis Club, great Richardson Bay views back to Sausalito and the entire youth soccer contingent of Mill Valley and Tiburon. Past the largest soccer field the trail splits, take the less-used right which will take you down to the intersection of Tiburon Blvd and Trestle Glen. Cross over and head up a short climb on Trestle Glen to the intersection of Paradise, turn left and follow your popcorn trail home, back through Corte Madera, over the Camino Alto pass into Mill Valley, left at E. Blithedale and right onto the bike trail.

Total ride time 1:45, 30miles, 17-18 ave speed. Great Road Ride.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

A German Teacher Tribute

Joe Burns (Frank Howard Allen - Sausalito) — Thu, 22 Oct 2009 16:22:45 -0500

This past weekend I had the rare privilege of attending a tribute to a retired German language teacher. My Mother-in-law, BS, is a retired San Francisco high school language and art teacher. A talented artist and fluent in German due to her family upbringing, her passion for these two subjects equals her education. I married into the family late in life and didn't get to witness BS in her employed years, but knowing her now, I can imagine as a teacher she did things one way; her way. I'm sure there were curriculums, but her students received something totally unique in public schools - life-lessons, reality, love and respect. I know weird unh? To actually teach young adults practical lessons and show them respect as humans and not cattle is contrary to a teacher's survival in today's world.

The tribute was a surprise Oktoberfest party for BS on Angel Island, planned and implemented by her former students of nearly 25 years past. My wife, BS's second daughter, helped coordinate a family picnic on this beautiful island State Park in Marin County. The rest of the attendees waited at the party site some 2 miles from the ferry dock and surprised their "favorite teacher ever" with a BBQ of German Brats, German salads and beers, and fond memories. I got to meet, for the first time, many of these past students and their families that I have heard about in various stories of classroom lore. Why Angel Island for an Oktoberfest? Because BS used to throw a similar party for her students, back in the day. That's right, the German teacher took her students on a field trip across the bay for annual picnic celebrating the culture she knew and that they seek. If you think that is unique, you'll love this; she also took her students to Germany on two separate occasions. Not Germantown USA, but GERMANY.

Various past students told me how their German teacher changed their life, set them on different paths or taught them lessons they still remember today. Really, the German teacher? I don't even remember my high school Spanish teacher's name, let alone a single thing she taught me other than ‘Como se dice'. As one student described, "She taught us manners and how to set a table, while speaking German." Another, "she was like our mom".

After these students graduated they continued to write and keep in touch with their German teacher, she attended their college graduations, they introduced their girl and boyfriends, they invited her to their weddings, and now, some 25 years later, they still include each other in social events.

Teachers didn't and don't get paid much. I've often asked why then do they choose that profession. BS is why. Nice work Mother-in-law.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Mid October Trends Concerning

Joe Burns (Frank Howard Allen - Sausalito) — Tue, 20 Oct 2009 18:07:28 -0500

My mid-month trend report for October, 2009 is a little alarming to theory that we have bottomed out on pricing. Using Bareis MLS stats as my source, Oct 1-15 shows the entire sales volume of Marin County Real Estate for both Single Family Residences and Condominiums at 93 sold units. This is on par with Sept mid-month volume of 92 and August mid-month of 91.

The concern is what is currently showing as average price and price per square foot(value). As you know in past posts, I use average pricing as opposed to median pricing as it is easier determined in our system and I support the use of price per square foot as a market barometer (but not used as a value indicator on a particular property). PRICING is just that, the average money spent, but applying an additional modifier helps determine VALUE. If I had more expertise and time, I would breakdown my modifiers into a matrix of bedroom/bath size, sf, lot sf and parking, then apply those to the pricing to determine what average values are actually doing. But, I'm a simpleton, so I stop at just tracking price per sf.

The Average Sold Price for Marin County, Oct 1-15, is $691k, this is down 23% from the mid-September price of $898k. The Price/Sf for mid-October is $405/sf, down 8% from mid-Sept $437/sf. How the month ends has not been too much different than the mid-month averages in prior months, so October is on pace to have a large decline in price and value, but a volume pace of the prior few months.

My September figures from MLS paint a different picture than what was reported in our local press. MLS only considers properties traded on the open market. The media uses a source that includes all recordings. Though complete, these additional sales are too often skewed because they are not a reflection of free market trades. Anyway, as my numbers showed an increase in average price and value in September, October's pace is back to July and August's numbers.

If you're still reading this blog and have any specific questions about the stats, please don't hesitate to comment of contact me.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Marin Bike Rides (Series): Headlands, Miwok, Tennessee Valley

Joe Burns (Frank Howard Allen - Sausalito) — Sun, 18 Oct 2009 16:29:08 -0500

In the first of many-to-come great bike ride posts in Marin County, the Headlands -Tennessee Valley mountain bike ride is one of my favorites. This ride is a quickie, perfect for early morning or late evening calorie-burn ride.

(described as a pre-dawn , weekday ride)

From Downtown Sausalito: Head south on Bridgeway like you're heading to SF, as you pass Princess Street you either see the lights of San Francisco or the fog bank that confirms the climate preference of Marin Co. Often in the 6 o'clock hour of the morning you will see a larger freighter heading out to the Pacific. In the quiet of the morning you can hear the boat's engines wind and with all else being still it is almost like you are alone with this massive liner. Continue your pedal up Second St, don't gear down much, just stand and work through it, there is plenty of soft climb ahead to recoup. As South St turns into Alexander there is another little uphill burst. At this point there hasn't been enough ride time determine your energy level for the morning, but depending on time you may want to turn right at Bunker Rd and go through the tunnel. (This detour only save a couple hundred feet of climb and 12-17 min of ride-time.) If you have the full 1 hour then bypass Bunker Rd and continue up Alexander, under Hwy 101, and right at the Highway entrance to the Headlands Rd officially known as Conzelman Rd. The first part of the paved-road climb is the steepest, not a little ringer, but still a bit of punch for 500 yrd, then it levels out to a steady mid ringer for 1.2 miles to McCullough Rd.

Now at this point if it is still too dark and you don't have proper lighting, you can choose to head down McCullough on the paved road, the better route is to veer right on McCullough, then cross over to the northwest corner of this intersection to a dirt parking lot and gate. Enter the gate there and pick up the Coastal Trail. This is a real fun soft downhill single track of 1.6 miles. I keep my mouth motoring with shouts of my arrival as to not startle a feeding mountain lion. Most summer mornings this trail is still fogged in, by September the fog rolls back a little earlier, but it is also darker at 6am. There are a lot of cottontail bunnies on the trail, but they scurry out of the way quickly. Deer are less mobile and can be hit if they are in an area that doesn't have a quick exit.

At the bottom of the trail is an auto gate, continue on the trail to the road, cross over and left on Bunker Rd (look both ways) and pick up the parking lot trail 20 yrds up. From this semi-paved lot you will see a trailhead in the trees that is marked with a small sign, take this path over the small bridge and up to the fire road, turn left on the fire road and follow up to the Miwok Trail, be careful not to turn right on Bobcat Trail and stay left until you reach Miwok, then turn right. Now you have a great 1.5 mile climb, so may get away with a middle ring climb, but I can't very long and shift down to little ring saving one or two rings in the back. The climb has a couple steep points but for the most part is a consistent grade to the Wolf Ridge Trail. Continue past Wolf Ridge which is a pedestrian-only trail and head up one more steep climb before dropping down a couple hundred yards to a left turn onto Old Springs Trail. Once again, a fun and easy 2 mile downhill with no drops and only a couple kidney-shaking stairs at the very end. The trail ends at the Miwok stables and we respect their request to dismount your bike and walk through their parking area. Say hello to "Casino" and "Maxwell" in the last two corals, then remount and head down Tennessee Valley Rd at a big ring pace. After passing Marin Rd on left, cross over the street to catch the creekside trail past the park lodge and under Shoreline Highway(duck your head), and continue to the Mill Valley Sausalito Bike Path along Richardson Bay. You can now streak up the trail to Mike's Bike, onto Brideway and back to your starting point.

Great ride, extremely scenic in all seasons and all times of the day.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Elegant Contemporary Sausalito, CA Home

Joe Burns (Frank Howard Allen - Sausalito) — Tue, 13 Oct 2009 13:46:49 -0500

This Marin County home has Bay and Mt Tam views throughout. There are 2 bedrooms, 2 baths, a large solarium, and an office. The over sizedchef's kitchen has a huge sliding glass door that opens to a private patio and Zen like gardens. Additional features include: hardwood floors, vaulted ceilings, fireplace, floor to ceiling glass, 2 car garage, above average storage, and a view patio with hot tub. This fine home is in a quiet Sausalito neighborhood at the end of a cul-de-sac, yet close to transportation, restaurants, marinas and shopping.

$1,349,000 Reduced to $1,250,000

For more information on this Sausalito, CA Home or any Marin County property, contact Joe Burns at 415.450.8855 or JoeBurnsMail@gmail.com

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Marin County Schools and Real Estate Options

Joe Burns (Frank Howard Allen - Sausalito) — Fri, 16 Oct 2009 16:06:44 -0500

Marin Schools and Real Estate Options

If you are considering a real estate purchase in Marin County the chances are pretty good that the quality of schools in our county is driving your decision. Though Marin offers many great unique lifestyle options, public schools is what causes purse strings to open. This eco-conscious, high-income per capita, houseboatin' county prides itself on parent interaction in schools and the test scores derived from their efforts.

Test scores are not the end all to the success of our schools. I, as an example, was able to take test quite effectively in my scholastic career, however 20 some years later and I struggle through a simple blog post. For those that do subscribe to the testing results of the State's Academic Performance Index or the No Child Left Behind Act Adequate Yearly Progress (AYP).

The API scores is public information interesting if not valuable. The problem I found is that it is difficult to find a compilation of the API scores for a given area. As a service to my clients and friends, I went through the system and compiled the last 5 yrs test scores for every public school in Marin County. With this report you can see that Hall Middle School in Larkspur is a 6-8 grade school of 495 tested enrollment and scored 919 on the 09 Growth, compared to 924 in 2008 Base. In 2005, Hall earned a 901. I also included the Similar School Rank which is a 1-10 ranking of schools with similar demographic characteristics. The remarkable thing about this report is how many schools in Marin fall above the 900 pt mark. Some standout and some need more work, but the report confirms that you can't beat Marin for public school options.

Due to the challenges of adding an Excel spreadsheet to a blog, my report is not available here. I would be happy to email the spreadsheet to anyone interested. Send me a request to JoeBurnsMail@gmail.com .

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Sausalito Condo with Large Yard

Joe Burns (Frank Howard Allen - Sausalito) — Fri, 16 Oct 2009 14:16:15 -0500

You don't often get a 2bed/1.5ba, 1208sf condo in the heart of Sausalito, CA with level entry, views and large yard, however with this little gem you get all that, plus dedicated off-street parking and fully remodeled bathroom and custom tiled kitchen.

Oh yeah, and the short sale list price is only $595,000. (lender approval required)

Views of Mt Tam and Richardson Bay. Look at this Bath -quality design and finish.

Fireplace in large LR

Lots of shared yard and garden area.

Though this is a 2 unit condo project with an HOA, there is no monthly/annual fee. It is simply a duplex style building with two separate owners and APN's.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Mediterranean Classic Sausalito, CA Home

Joe Burns (Frank Howard Allen - Sausalito) — Thu, 08 Oct 2009 23:03:22 -0500

Located in the coveted Banana Belt of Sausalito, CA, this is one of the finest vintage homes in Marin County. This gated property has undergone extensive renovations and updating. The period aesthetic charm has been beautifully maintained yet all modern amenities have been provided. The lovely grounds include palm trees, tropical plantings, a sprawling lawn, and a beautiful outside terrace. There are sweeping views of San Francisco, the bay and a sunny exposure. This rare gem is not to be missed.

•· 3 Bedrooms

•· 2 baths

•· Office

•· Studio

•· Pantry

•· Chef's Kitchen

$2,475,000

For more information on this beautiful Marin County home contact Joe Burns at 415.331.6400 or email JoeBurnsMail@gmail.com

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Mortgage Delinquencies - The Coming Storm

Joe Burns (Frank Howard Allen - Sausalito) — Wed, 30 Sep 2009 16:52:00 -0500

I have read a lot of blogs about the next phase of mortgage delinquencies. Jeff from Lancaster, PA does a great job in illustrating.

Via Jeff Geoghan MBA - Lancaster PA Real Estate Expert (The Jeff Geoghan Realty Group, Coldwell Banker Lancaster PA):

This is one of those posts where I wish I didn't have to write it, but felt it was so important to my readers that I would be remiss not to at least talk about it.

Everyone out there probably knows somebody who is behind on their mortgage payments, looking for alternatives and likely also just finding out that their home's value has dipped below what their loan amount is. I know some within my own personal circles. It's a tough situation for me to advise them as a professional because it's such a personal challenge to their pride and self-worth, not to mention their plans an dreams for the family. The question we're asking is "when is this going to stop and where are we heading?"

I'm going to put up a few graphs that show the trends nationally with regards to mortgage delinquincies:

This chart is by quarter - Single-family mortgages set a new record delinquency rate in the second quarter of 2009, according to a quarterly survey by the Mortgage Bankers Association. Those of us in the real estate business see the foreclosure process (just visit the local Sheriff Sale docket to see the current numbers) but the looming delinqency-to-foreclosure issue is far, far larger.

The Wall Street Journal on 8/3/09 reported the following quote: “While subprime mortgages sparked the first round of housing problems two years ago, now "troubles are lurking further up the food chain," says Joshua Shapiro, chief U.S. economist at MFR Inc. White-collar job losses have accelerated while more adjustable-rate loans to prime borrowers are resetting to higher payments. ‘You put all that together, it leads me to believe that the next leg down on home prices is going to come from the top,’ he says.”

The first objection someone may have would be to say "yes, but historically those who are delinqent usually get their act together and come current on the mortgage after a while". That WAS true, but not anymore! We call that the "Cure Rate", that is the rate of delinquencies that go back to current. The Wall Street Journal reported on 8/24/09 about a Fitch analysis that found that the Cure Rate from 2000-2006 was 45% (which means about half of people fix their delinquency). However, as of July 2009 the rate had dropped to just 6.6%! That means that over 90% of delinquent customers are going to foreclosure. Take a look again at the above chart...

The next thing someone will say is "well, that's the 'sand states' and not my area". Here's the chart for all 50 states showing the same breakdown of delinquencies and foreclosures. Guess what - most states have a significant problem, especially compared to historical figures.

Now the next thing someone may say is "aren't those loans going to get 'fixed' by a loan modification?" I know several people right now who are applying for a Lancaster County loan modification but are waiting and waiting. I hope it works out for them...

In reality, loan modifications are hardly making a dent. To me, that's a burning question. Why arent banks being more aggressive in giving customers the option to extend their loan and/or reset to a lower rate? Why are they being SO difficult? The people I know don't want to be foreclosed. They CAN make payments. They just need the terms redrawn to allow them to catch & keep up. Loan modifications are not helping us get this crisis under control.

What are the causes of all these delinquencies? Here's a chart that is enlightening:

We hear a lot about adjustable rate mortgages being the culprit, but the reality is that it's the loss of jobs and the tanking real estate market that's the perfect storm. See my previous post on unemployment in the nation, the state and Lancaster County.

Keep in mind, this post is not intended to give us "good news". You may be experiencing good things in your market and that's great. My intent is to get us thinking about the challenges that aren't going away and how we're going to address them as homeowners, agents and professionals. I'd love to hear your ideas!

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.

Give Al Davis a Break

Joe Burns (Frank Howard Allen - Sausalito) — Mon, 21 Sep 2009 13:30:09 -0500

I remember that April morning this past spring when I had other plans and didn't get to partake in my annual ritual of camping in front of the TV to watch the NFL draft. However, though I wasn't watching I was quickly made aware by friends and later by news media that Oakland Raiders owner Al Davis somehow passed on the incredible Michael Crabtree from Texas Tech and instead drafted potential 2^nd rounder Darrius Heyward-Bey. "What an Idiot." "The old man has totally lost it now." (giggle, giggle from the Raider-haters), "He is single-handedly ruining that organization."

So where are those snickerers now? Heyward-Bey isn't Arnez Battle yet, but at least he is on the team and contributing. Crabtree may be good someday, but I think Al knew he was a head case and a young vulnerable team does not need that challenge. Good draft call.

These are the same detractors that look for every Al Davis news story to try to discredit the passionate leader of the most loved and hated sports team ever. Yeah, Al Davis is old, makes old-school decisions, doesn't get along with most people really well and is probably 3 years past his optimum retirement age. BUT, the guy does not deserve the constant ridicule he receives.

Another Davis move that caused a stir - drafting Sebastian Janikowski in first round. Unheard of... you never draft a kicker #1. Stupid? Seabass regularly leads, or in top 2, the NFL in touchbacks and longest FGs made. His percentage is above average and his overall scoring is pretty good considering the team's lack of offense. This is the kind of kicker other teams would trade a number one pick, why not just pick him number one?

Hiring and firing Lane Kiffin. Yep, good move on both parts. Lane is a bright coaching star, with long-term upside - a good hire. He was clearly too immature for prime time, something he proved the minute he got to Tennessee - a good fire.

Same with Jon Gruden, great hire, but most Raider fans were frustrated with Gruden's timid play calling and he decimated the Tampa Bay Buccaneers AFTER he won the Super Bowl with Tony Dungy's team.

Norv Turner... you can have him, I think he is a great O-coordinator, but terrible head coach and another good hire; good fire.

Mike Shanahan - good hire, bad fire, big mistake, should have found a way to keep this guy. Though he didn't do much without Elway, he is a quality football coach.

Al Davis is also known for taking washed up players and getting a little more out of them. .. Jim Plunkett and Todd Christiansen. He has given more minorities top positions than any other coach...Art Shell, Tom Flores, Amy Trask.

I admit, he is too involved in the daily operation of the team, considering his age, style and the transiency that free agency has created he just can't be the wise ol' owl swooping over practices and pre game exercises. BUT, that is what you get with a guy who's been a part of the team for nearly 50 yrs, a Hall of Famer, and the guy behind the money behind the team.

AND, he has done most of this in the single worst sports market in the country. Oakland sucks. It is a terrible place, the leaders are sporting-event illiterates, the police spokesman gets more airtime discussing shootings than the coaching staff does, the local media has always coddled the Giants and Niners, while leaving the A's on ledge and hating the Raiders for their ‘screw you media' attitude, the A's want out bad and the Warriors can't win a pickup game at the YMCA. I couldn't blame Al when he moved to LA; my family left the East Bay around the same time, it sucks.

At the time of this blog, the Raiders are 1-1 and headed to a probable 6-10, 7-9 season. Too bad, because the die-hard fans deserve more, but we continue to be Raider fans (even if we have to hide our support) because we DO have Al Davis and his willingness to step out of the box to make HIS team better.

If I can provide more information about Marin County real estate and lifestyle opportunities, please call me at (415)450.8855 or email me at JoeBurnsMail@gmail.com.