Case Properties

This nice home in Bay Point is back on market. 3 bedroom, 2 bath home on large corner lot. $171,900 Give us a call for details. at 925-308-7045 

Interest rates are near historic lows, prices are lower now than in 1999, the Federal Government and the State Government are offering tax credits that can total up to  $18,000.00………..

and no one is buying; at least not in Contra Costa County.

Why is this? There are several rationales that make an explanation, but upon close examination do not stand up to logic. Let’s look at why.

1) The economy. It is weak with no projected end to the weakness according to the Board of Economic Statistics. We have 12% unemployment in the state with projections into the future of continuing high unemployment. Even at unemployment of 12%, 88% of the people are working. There are plenty of people that want to purchase a home but feel they cannot because of factors that do not affect them.  They read or hear the news, they see the number of people in foreclosure and all of the empty homes on the block and are afraid it could happen to them. Everyone has his or her own reasons, but to this point, these reasons do not apply to them.

2) ‘Timing’. As a rule people purchase things at the wrong time. Everyone is familiar with the catchphrase; ‘Buy low, sell high.’  However in our area people seem to do the opposite. Over the past 10 years peol;e have bought high and now they are selling low. Why? It has to do with the psychology of the masses. When everyone else was buying, many people were feeling forced to purchase a home as prices rose. They were afraid that they would be priced out of the market. At the top, many people were already priced out but deceptive lending practices got them into a home that a.) they really could not afford and b.) that really did not meet their needs. Timing the market is something that is done by professional investors. It does not apply to the purchase of a home or any other long term purchase.

3) Buying for the wrong reasons. During the meteoric rise in real estate prices, many peole lost their way with regard to buying a home, assisted by the lenders and the government. If you are a homebuyer, looking for your perfect home, it is not an investment. It makes no income and ,in fact, it is not calculated as part of your net worth, as in order to make profits from it, you must collect income, not just make a payment. Too many people were sucked into the belief that it was an investment as the monthly increases of prices were publicized often, making some people ‘paper millionaires’ with the current values of their homes. All of the paper profit has disappeared, as well as the homes that many people had due to the collapse of the economy.

An investment makes money; therefore investing in real estate requires that you must collect rent. If you live in your home, it is not an investmement. certainly if you live there 30 years and do not refinance the property, you will own it outright, but in order to make it an investment, you must move and become a landlord. Many people would prefer not to be a landlord, so the investment aspect of real estate disappears. If you purchase real estate on the hope that prices will rise, you are not an investor, you are a speculator.

The last time prices were at these levels, interest rates were 3 to 4 percent higher. Yet, people bought. I think the reason they bought their home was that they were not being bombarded by the constant onslaught of bad news.

My recommendation is to ignore the news and follow your needs, rather than someone else’s. We can help you as a homebuyer or as an investor; and know the difference. Give us a call at 925-308-7045.

Bank of America launched a new program to help homeowners reduce their mortgage principle. Please give us a call if you have a Bank of America Mortgage.
925-308-7045.

Another incentive toward homebuyers! California has reinstituted a tax credit for new homebuyers. $10,000 or 5% of the purchase price whichever is lower. If you have missed the Federal Tax Credit, you can benefit from this one! See the attached.

New CA Tax Credit

We hear all of the time, ‘Buyers go to the Internet first when begining to look for a new home’. The National Association of Realtors claims that 90% of Home Buyers go to the Internet first. That may be true, but I must ask ‘Would you buy a home over the Internet without going to it first’?

We can buy lots of things on the web, books, home goods, toys, supplies, and loads of other things. But when it comes to making one of the most important purchases of you life, would you buy it over the web or would you use an experienced representative to ensure you are getting what you want at a fair price?

I think that an overwhelming number of you would choose to get a little help. Of course, the number one response I get to this is that many people would choose to use the Listing Agent to represent them, because after all, ‘he can get us the best deal…….’  To be honest, using the listing agent may be one of the worst ideas a Homebuyer can have. Of course, we will do it if the Homebuyer insists, but we recommend against it. We do this for one very simple reason; we have a contract with the Seller and we represent him. We are bound to get him the best price and terms, not the Buyer. We cannot disclose any of his private information but must relay to the Buyer his terms.

Getting back to the topic at hand. Prior to the Internet, there were the newspapers, prior to that you had to call a Realtor first, or you could cruise neighborhoods looking for open houses to visit. It was unlikely that the home you may have entered on a cold open home visit would meet your living requirements, price and budget, or other requirements. The Agent then could set you up to find a home that met your needs.

Many peole use the Internet the same way; they cruise the real estate websites looking for available homes (hence the claim that 90% of the buyers start with the internet). There is so much information on the web that it can (and does) overwhelm the average Buyer. Additionally, often the web is not up to date. Once in a while I look at listings on the web for the express purpose to find properties that have been off market for a while. It generally takes me about 2 minutes to find many homes advertised that have been sold or taken off market over 1 year in the past.

With todays gas prices, cruising neighborhoods is not the best use of  this precious resource.

Using the internet to find your new home is equally ineffective.

What is a Buyer to do?

Most real estate companies provide their agents a targeted search, often modifiable by the User. The best solution is to contact a Realtor and specify your search criteria; price, square footage, the number of beds and baths, location/neighborhood and lot size are common specifications but there are lots of others you can name. The tools then provide you an up to date list of homes available that meet the specification. After contacting your realtor, you can then get appointments to see the homes you are interested in.

The results? Lots of time and gas saved. You see homes, all of which may meet your needs. You may find that what you thought you wanted is not at all what you purchase (this happens all of the time). You are represented by someone who has your interests in mind.

All of this is the result of using the interent wisely. The web is not designed to be used like your car, idly meandering through the neighborhoods, wasting time and money. New tools means new approaches to accomplish old jobs.

After speaking with several escrow and title representatives recently and experiencing it ourselves, we have noticed new ways that some real estate agents are extracting fees from their clients.

The most popular one is the transaction coordination fee, which ranges from $200 to $450 dollars. Many agents use transaction coordinators to do the tons of paperwork required in every transaction, chase down and get return phone calls, status updates, and the like. These are all things that a competent real estate can do, but many times when they get busy and the help is beneficial to keep on top of the many transactions that successful realtors may have. These tasks are also ones that unsuccessful realtors may use in order to avoid doing the loads of work that can be overwhelming. Either of these is alright, as the paperwrok gets done, the transaction closes on time, and everyone is happy. However, the problem is when your agent charges you for the service. Most agents consider this as part of their service to you and pay for the coordination themselves. When you are charge as a Buyer or Seller, you should question that charge andwhy you should pay for it.

Other charges that have been popping up are $800 ‘escrow’ fees (escrow charges their own fees), paperwork costs, desk fees, etc.

When selecting an agent, ask them what fees they will be charging and question why. When selling your home, you will be charged the commission as that is how an agent makes their living. When purchasing, you agent normally will not charge you anything for their services.

For what its worth, we do not charge any ‘extra’ fees when working with our clients.

This morning as I was watching the news on the potential tsunami in the Pacific Rim, especially Hawaii, the main thrust for everyone was to collect survival items required to sustain the family for 5 to 7 days.

Although a tsunami is usually not a big worry for us here in the East County, we do have another potential disaster for us to consider. When the Big Earthquake hits, will you be prepared? It hit me pretty hard when I assessed my home and found that we fall short in survival supplies.

With a very little amount of searching, I found a resource that lines out what you (and I)  may need for an earthquake emergency here in Northern California. I highly recommend that you review this site, maybe even print it out (it has the facility to do it.

The URL for this website is: http://72hours.org/.

The site outlines the supplies that you will need to make ends meet for 72 house after the cessation of services after an earthquake, flood, terrorism attack, or other emergencies.

The contect of this site are now in FaceBook!

Just log in to Facebook (you must be a FaceBook member togetin, at no charge of course), and search for Case Team. You can comment, discuss, and much much more on the site there.

See you soon.

We just got the report from the NAR that existing home sales were down in December from November by 17 percent. Rather than react to the way the media and the NAR want to present it, blaming the end of the Homebuyer tax credit,  this decline is the result of the following factors:

1) Buyer uncertainty – December sales were probably entered into contract in October or November. During this time, unemployment was rising and there did not seem to be any end to it, just as today. People look at their finances and hold back during times of uncertainty. This especiallt applies to large purchases, including homes. Until such time as there is a little confidence built into the news, this will be aconstant issues.

2) Seasonal influences. Sale ALWAYS GO DOWN during the holidays. Last year was no different. While this decline was nearly a record decline, see reason #1.

3) Availability of credit - although interest rates are low, financial institutions have raised qualifications, added tone of new rules and paperwork and denied loans that have been approved in the past. This began at the start of the 4th quarter last year and finally evidenced itself in December. Lending institutions are trying to deal with ever changing rules laid down by the regulators as well. Until this confusion ends, it will be more difficult to obtain credit.

The media and the Treasury know all of this to be true, but will not print it. You need a source you can trust to give you the facts.

Also, we are on Facebook. Use this link to add to your pages for this article and much more!

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If you know of anyone having problems with thier lender, please them know that there are options and we can help.

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