Comments on: Who should buy Southern California real estate between now and Christmas

By: ReaL Estate Raj

ReaL Estate Raj — Fri, 24 Oct 2008 00:19:33 +0000

I agree with most of what you said. I’m looking in the North OC area and still think that market, particularly the Fullerton area still has another 10% to go.

By: HS

HS — Sun, 12 Oct 2008 17:22:12 +0000

If you look on Redfin MLS they will show you the home prices, and how much the home your researching went for at the height. It will also show similar sales. I have seen many in So. Cal for over 60% off the Crazy prices of 04-06. Some REO’s are even more. Just do your research. Most investors and banks consider that your total monthly expenses need to be less than 75% of what you could rent it for to truly break even on renting an investment. In my rentals over the last decade this has certainly been the case. So if you crunch your numbers and can come up with this total (ie- a 750 payment with Princ. Int. Ins. and Tax and the home can rent for over $1000) then you should be fine (it sits, and thigs break etc) If you can get this price , many investors will be willing to buy. And as long as you have a little liquidity then you can wait until prices go up. I believe there is more choices available as the trend curves toward the bottom than when it just starts to go up. You may get a much better investment. God Bless your Investments and may you ever thank Him and Give back to the One who gave it to you in the first place (Oh that He would bless us indeed-scripture quoted in Prayer of Jabeez book)

By: Boomer55

Boomer55 — Tue, 30 Sep 2008 05:56:08 +0000

And frank, you and I are in the same boat looking for the same signs. Hold tight until the end of the year. There will be bargains galore. The feds will artificially reduce lending rates just to motivate homebuyers to jump off the fence and commit.

By: Boomer55

Boomer55 — Tue, 30 Sep 2008 05:53:31 +0000

You foks know why the foreclosure rate has slowed significantly in California? The Legislature passed a measure whereby a lender has to give a borrow a 60-day notice of intent, instead of the traditional 30-day notice. That effectively ensured that for a 30 day period, no homes would go into foreclosure. But once the 60 day window has passed, the rates continue to increase as before.

By: frank

frank — Sat, 06 Sep 2008 21:46:15 +0000

I agree with you that there are some t great oppurtunities right now but the bottom line banks are still bogged down. In california the banks are driving the market and thats not such a good thing. They accont for about 40% of all home sales in california. Gmac laying off 60% of its employees and shuting down hundreds of lending firms tells you that people applying for home loans is actually going down. Real estate in california is still historically overpriced as you compare it to income i think prices need to come down to normal levelsistorically. Interest rates rising will only bring prices lower. Unemployment will continue to rise through the end of the year . The government will dictae real estate bottom in the mean time i will sit tight. I have been sitting tight on a pre -approved loan from countrywide for four months but there is nothing out there that tells me buy. Keep up the good work and hopefully you guys can post more often because there is so much going on in the market

By: Blair Newman and Dave Emerson

Blair Newman and Dave Emerson — Fri, 05 Sep 2008 19:04:40 +0000

bassist,

Thanks for taking the time to comment. I’m well aware of the ongoing reset issue. It is a concern, but I didn’t go into it the post, because I’ve concluded that the reset problem is overstated:

1. Many of these borrowers have already been foreclosed upon or negotiated short sales. Just this week we closed a short sale for a seller that had no problem making the current payment, but could read the writing on the wall–and on her monthly statement. She knew her payment would double next year, she knew she was upside down, & she decided to deal with it sooner rather than later.

2. The banks may be slow, and they may have made some very dumb loans, but they’re not complete idiots. Most banks would rather work out than reset, and the bailout bill gives them some new options. Banks prefer modifications to foreclosures, and many resets will be renegotiated.

Time will tell. Bears will never think prices have fallen enough, but I sense we may look back on this as an opportune time to buy before thousands of vacillating buyers all get off the fence.

I’m now seeing some homes list for almost half their value at the peak. There are real values out there, and I expect there to be even more between now and Christmas.

The point of this blog is for an experienced Realtor/broker to tell you what he’s seeing on the front lines, and I’m seeing some exceptional values. Yesterday I had breakfast with the broker/owner of a large local property management firm, & he voluntarily said exactly the same thing.

Time will tell, and if I sense things moving in a different direction, I’ll post it here first.

Again, thanks for taking the time to comment.

By: bassist

bassist — Fri, 05 Sep 2008 15:59:08 +0000

Please educate yourself on Alt-A and option ARM resets, then revise your prediction on when SoCal will hit bottom!