A Recent Success Story on a Short Sale

Home Inventory Plummets, Pushing Prices Higher

The supply of newly-built homes fell to its lowest levels since 2006, offering additional proof of a housing market in recovery.

Home supply is defined as the amount of time it would take to sell the current inventory of homes at the current pace of sales.

In October, for the 8th consecutive month, home supplies fell. Since peaking in January 2009, it's now down by almost half.

Lower supply leads to higher prices. This is Economics 101.

Furthermore, supply is expected fall into 2010. According to the government, builders are breaking ground on new homes at a declining pace, even as sales ramp up.

Builders are cheering the October New Home Sales report, but its the everyday sellers of "existing homes" that have real reason to celebrate.

See, as builders clear out their respective inventories and turn profitable, there's less reason for them to offer the types of over-the-top purchase incentives that characterized the last 12 months of selling.

With fewer builder incentives, the playing field levels between large corporations and individual home sellers.

And while this is happening, buyers are eagerly taking advantage of low mortgage rates and federal tax credits for buying homes. It's pressuring home prices higher overall.

Since January 2009, the average sale price of a newly-built home is up 6 percent

Inventory update in foreclosures, regular sales and short sales..

Here's a little status update on our Listings:

9151 Regal ave, Anaheim - accepting backup offers

4832 5th street, Santa ana- 199k accepting back up offers

5013 Kent ave, Santa ana- regulars sale , in escrow in 7 days $40,000 over asking!!

1106 Flintridge Santa ana- regular sale in escrow in 5 days $45k over asking.. Pool home

13022 Edwards , la mirada - Foreclosure that won't last the week..offers have been received, so there's no time to waste if you're interested in this one

4717 flight ave, santa ana- short sale approved, in escrow and axmceepting back ups . A steal at 270k!

15920 miller ave, Fontana - foreclosure - attention! Great opportunity ! Feel out of escrow ***Clean 1900 sq ft home $ 214k, was 232k
another one that will not last...

If u'd like more info on any of these, or any of our other listings, just contact me directly! 714-745-0896

You've Got 15 More Days To Use The First-Time Home Buyer Tax Credit

The government's First-Time Home Buyer Tax Credit program expires November 30, 2009 -- a scant 60 days from today.

Considering it can take up to 60 days to close on a home, first-time buyers have 2 weeks at most to find a home.

Buyers not under contract by October 15 have little chance of meeting the November 30 deadline and, therefore, little chance of claiming the tax credit.

This is especially true for purchases involving short sales and foreclosures.


Congress passed the First-Time Homebuyer Tax Credit program as part of the 2009 economic stimulus plan. IRS Form 5405 outlines the program criteria which include the following stipulations:

Buyer may not have owned a "main home" in the past 36 months
The home may not be purchased from a parent, spouse, or child
Adjusted gross income for the household must be below $95,000 for single tax filers and $170,000 for joint tax filers
The credit is capped at $8,000 or 10% of the purchase price, whichever is less. And don't forget -- the First-Time Home Buyer Tax Credit is a true tax credit. It's not a deduction.

This means that a tax filer who claims the full $8,000 and whose "normal" tax liability is $5,000 would receive $3,000 cash from the US Treasury when their tax return is processed by the IRS.

If you can't close by November 30, 2009, though, you can't claim the credit.

The clock is ticking. If you're planning to use the First-Time Home Buyer Tax Credit, the time to act is now.

Existing Home Supply Falls by Nearly a Year

As reported by the National Association of REALTORS®, the number of Existing Home Sales dipped last month, ending the metric's 5-month winning streak.

Newspaper headlines today are overwhelmingly negative on housing. You'd almost believe this year's housing recovery had ended.

That's hardly the case.

See, the other side of the Existing Home Sales story is that -- while the number of units sold did fall by 3 percent -- the existing supply fell by nearly an entire month.

To home buyers and home sellers, this is huge. Home prices are based on supply and demand and with supplies plummeting, it means that home prices are poised to rise.

Indeed, dwindling inventory isn't "news" to today's buyers. Multiple offer situations have been common since the start of the summer and, should supplies fall further, they may soon be the home-buying rule rather than the exception.

Since peaking in November 2008, existing home supplies are down 23%.

Summit Event in the Desert

For those that don't know, I have a business coach that fills me in every week with the latest trends and issues dealing with Real Estate. Well, this last week, Tom Ferry ( my coach) had his yearly event that spoke to about 2000 top agents from all over the nation. He spoke about the current Buyers Market that we are experiencing, the Foreclosures situation and most importantly, how to better communication with the public and get more involved with the conversation that is occurring between Realtors, buyers, seller, investors, etc... One of the major topics was about social media and house to get connect with this conversation that most of us don't know even exist. So, my pledge after the event is to become even more informed and connected by subscribing to twitter.com and facebook.com (twitter.com/alexanderpiana and facebook search alexander piana).

Ive always said communicaiton is the key in all things Real Estate, so Im excited to get this started.

H.E.R.A is coming...

H.E.R.A ( Housing and Economic Recovery Act) is unfortunately another obstacle that any buyer, real estate agent and most importantly, lender has to deal with. Basically, on any loan done in California, expect more costs, paperwork and delays with H.E.R.A. coming this July 30th.

In summary there are numerous fees in California that affect the APR or
Annual Percentage Rate, many of which are NOT lender related fees. Here are
some of the APR affecting fees: Points, Processing, Underwriting, Wire
Transfer, Tax and Insurance Reserves, Per Diem Interest, Escrow Fee, Escrow
Courier Fees, Escrow Loan-Tie-In Fees, any other Escrow related fees.

A few months ago we were hit with HVCC. For those that dont know what this is, basically it requires on all conventional loans, to have the appraisal ordered through a central headquarters. Lenders no longer have contact with the appraisers. This new guideline nearly cost me a deal this week, due to the fact that the appraiser decided to state on his appraisal report that the home NEEDED new paint and the woodflooring needed to be replaced. Last I checked, most REO/Foreclosure properties require one of the two.

If anyone one has their own stories on either HVCC or H.E.R.A , Id love to hear it.

The Recent Foreclosure Moratorium affect on Home Purchasing and Those asking for help...

If you have been already putting offers on homes and to try to pick up that next great deal, don't expect a whole more of opportunities to come your way this summer. With the latest 90 day Moratorium of Foreclosures, there will be an even tighter lock-down on the current inventories in California. Lesser amount of homes going to foreclosure will tighten up the already decreasing inventory, making that deal harder to come by.

In simple Supply/Demand terms, the demand for homes has increased steadily over the last 4 months and the Supply of homes as sharply decreased. This bottle-necking of Foreclosures isn't going to help in a much needed Inventory increase for buyers looking to get into the market.

On the other hand, is the governors 90 day Moratorium even going to work for those that need it? Historically , those that are in Notice of Default and are getting help from their bank for a loan modification, tend to default on the loan within the next year anyways. The offerings that the banks are giving aren't what the home owners are needing. Homeowners are looking for major reduction in payment, interest rate and/or principle reduction. Yet the banks, for the most part, aren't going jumping to do major changes to the current financing. Most of these loan mods are for a temporary period and is more a band aid for people to continue in making their payments.

Watch those rates...

As I expected, rates went up last week and currently changed the payment the of 3 of my current clients. Now,we have to look at lesser priced homes and/or go into other areas to view homes in our price range. Many times I have clients tell me that they want to buy because of prices being so low. What they also have to consider is the current rate they get their financing at. Here's an example, my client went from being able to buy at $280k last month, to now only qualifing for $250k. This is the only way she can keep the same payment.

I believe inflation was the cause of the recent increase in rates. Typically we see changes in the rates around the summer time for one reason or another. If you've got pre-qualified in the last 3 months and haven't spoken to your lender in a while, I highly encourage you to give them a call to confirm your payment once again. Don't be victim of payment shock with the new rates...

Both Sides of the Housing Market...

My weekend was filled with 2 Open Houses in the Corona area. Within 4 hours or so my staff and I had a visit of over 20 families. For those that are not too familiar with the activity for an Open House, that is a substantial amount of people in a short period of time! After receiving 4 offers by Monday morning( 48 hours later), my conclusion is that the Real Estate market is alive and well. There ARE people buying their first home and people looking long term for investment/rental properties. Times couldn't be any better to buy Real Estate. I have been really seeing this movement for the last 6 months but more so recently. I'm sure the economic stimulus package and the governments tax credit of $8000 per couple did hurt matters any...

Unfortunately, the media today paints a much different picture of what is occurring with Foreclosure and Short Sale properties. Its commonly understood that Negative publicity always sells out the Positive. In the real estate example, the negative or the loss of a home by a family due to foreclosure, is something to understand and to learn from. Yet on the flip side, there is always a gain (or positive side) with another family that benefits, either with a new home for there family or a Rental property for their future. Its this positive that the media hasn't talked about at all. Being an agent and witnessing Real Estate move at the ground floor level, amidst daily transactions on selling and buying, I feel that the media could focus a bit more on the opportunities versus the losses within the housing market. I feel we all need a little bit of the bright side right now. Let me know what you think...