Mark Wisterman's Paradise & Lake Oroville Real Estate Blog

One of the biggest dilemmas facing potential sellers, in what is a very difficult market from their perspective, is what to do about making repairs, or performing upgrades to a home before placing it on the market.

Over my nearly 16 years in Oroville real estate market, I have consistently counseled sellers to be very careful about putting money into repairs and upgrades of their homes as it very rarely means that they will see all that money come back to them in the sales price of the home.

A recently released report by Remodeling Magazine provides some valuable data on what your expected return might be on monies used to  upgrade or repair your home. The information I am linking you to is for the Sacramento, California area as this is the closest area to the Lake Oroville area that the magazine rated.

While looking at these numbers keep in mind that this is a survey which only concerns itself with dollars spent vs. dollars recouped. Another major factor you should consider when judging the return on your investment is that, while almost none of the items surveyed paid for themselves, many of these items may actually help your home sell faster, which is of value in itself.  Remember: TIME IS MONEY!

Be sure to click here to see the report in its entirety.

Oroville real estate, oroville homes for sale, Oroville California, chico listings, Oroville listings, paradise listings, Paradise Ca homes for sale, Butte County home for sale, Oroville properties, houses for sale, gridley property

The National Association of REALTORS® yesterday reported, as expected, that home sales in the month of October, on a national basis, were up over 10% versus last month and topped the same month last year by almost 24%.

Conversly, median home prices continue to keep sales of Rolaids at record levels, as they continue to soften, albeit at a slower rate than previous months. 

The California Association or REALTORS®also released their regional monthly statistics, which include stats from the Nother California of which the Lake Oroville real estate market, as well as the Chico homes market and the Paradise property market, is part of.  I have posted those numbers on the side bar of both this site and our new office blog site which you can find by going to www.realtyworldoroville.com

No need to really jump into a big commentary on these numbers this month as we have discussed the reasons and consequences of our current market conditions before. I am, however,  looking for ways to bring this same type of information to you on a much more local scale to provide a clearer picture of our local market.

Here are some other articles that may be of  interest to you.

Related articles by Zemanta

• Home Sales Surge. Time to Party? curiouscapitalist.blogs.time.com)
• Home prices may be bottoming out money.cnn.com)
• New US home sales rise 6.2 percent seattletimes.nwsource.com)

With all the hoopla surrounding the extension of the first time home buyer tax credit, as well as the expansion of a smaller credit to existing home owners, I think it is time to develop a plan that actually addresses the LONG TERM needs of this market. I am talking about more than just the Lake Oroville real estate market here. We need a national solution.

As you know, I am not a big fan of using taxpayer dollars to pay people to buy homes. These handouts, in my view, are only band aid solutions where a tourniquet may be the better answer.  They do nothing to stabilize the market. In fact the tax credit is just going to delay the inevitable unless something is done soon to spur market demand for housing.

What I would like to do, over the next couple of blog posts, is to get your opinion on a plan that I think will finally put this real estate market back on the tracks, without government money.  And just so you know, it must be a great idea because I thought of it while taking a shower.  (If you have never heard of this theory before it must be because you take baths).

So let’s get started fixing this thing. Read the rest of this entry »

President Obama is expected to sign a congressional resolution that will extend, for another year, the increased conforming loan limits that were put in place in 2008 in an effort to bolster sales of higher priced homes. At the time loans for these homes became very expensive, sometimes carrying interest rates as much as 2-3 percentage points higher than those in the lower price ranges.

The extension would extend through 2010 the current loan limits of $417,000 for most of the U.S. and $729,750 for high-cost areas such as San Francisco and many areas of Southern California.

The conforming loan limit is the maximum mortgage size that Fannie Mae, and Freddie Mac can buy or guarantee.

While this affects the Oroville real estate market somewhat less than other markets in the state, it is an important step to take to keep the statewide housing recovery moving forward which will be good news for all sellers and other homeowners in our state, including the higher priced homes in the Chico real estate market, Butte Valley, as well as some homes for sale in the Paradise area.

The one piece of this puzzle that still needs to be found is the piece that increases the number of providers of Private Mortgage Insurance at an affordable price for home buyers. While the extension of these loan limits is a good piece of legislation, Freddie and Fannie are doing very little lending due to an inadequate number of insurance providers that are willing to insure these loans. When the mortgage crisis hit, many of these companies went bankrupt as they paid off on claims made on the insurance they provided for the overwhelming number of defaulted loans. As you might imagine, the remaining companies don’t want to expose themselves to unnecessary risk in this economic environment.

 For California, the extension of these loan limits is more important that the extension of the federal tax credit, and I am glad that the President seems poised to sign it.

My e-mail box and most of the social networking sites I belong to, including Facebook, are all abuzz with real estate agents trying to be the first to report that the first time home buyer tax credit has been extended.

It is great that they want to get news of the extension to the consumer as soon as posssible. The only problem? It hasn’t been extended yet.  What we actually have at this writing is an agreement in principle to extend and enhance the credit. An agreement that has yet to be voted on and an agreement that can possibly be changed before getting to the President’s desk for signature.

I have provided a link to an article published just hours ago by U.S. News and World Report that gives an in depth look at what is being considered and what the status is.

Click Here to See Report 

OROVILLE REAL ESTATE Paradise homes chico homes chico real estate gridley homes homes for sale Butte County Homes

As part of a package of 8 other real estate related bills recently signed into law by California’s Governor, AB 260 provides further protections to those borrowers who are worthy of borrowing money to buy a home, but may be a notch or two below the coveted prime borrower status.

Whether you are a borrower in the Oroville real estate market, or looking at homes for sale in Chico, or have decided that its time to start looking through property listing in Paradise or any other area of Butte County this information is important to know.

The new law places certain limits and prohibitions on what is now being called “higher-priced mortgage loans.”  Directly excerpted from the text of the new law, a higher priced mortgage is defined as:  

(a) Higher-priced mortgage loans —(1) For purposes of this section, a higher-priced mortgage loan is a consumer credit transaction secured by the consumer’s principal dwelling with an annual percentage rate that exceeds the average prime offer rate for a comparable transaction as of the date the interest rate is set by 1.5 or more percentage points for loans secured by a first lien on a dwelling, or by 3.5 or more percentage points for loans secured by a subordinate lien on a dwelling.

(2) “Average prime offer rate” means an annual percentage rate that is derived from average interest rates, points, and other loan pricing terms currently offered to consumers by a representative sample of creditors for mortgage transactions that have low-risk pricing characteristics. The Board publishes average prime offer rates for a broad range of types of transactions in a table updated at least weekly as well as the methodology the Board uses to derive these rates.

To help with the explanation of this I did a little online research and found the published average prime offer rate for 30 year fixed rate mortgage to be 5.06% last week. Based on the newly established definition, a 30 year fixed rate loan on a first mortgage with a rate of 6.56% or more would be considered a higher priced mortgage loan.

If you find yourself in a situation where you only qualify for one of these loans here are the new resrtictions being placed on your lender:  Read the rest of this entry »

On the surface, today’s existings homes sales report looks awesome.  A 9.4% national sales increase over last month, along with a 13% improvement of California homes sales, blew away analysts expectations and were at their highest point in 2 years. By the way, do you think these “analysts” have gone to the same school as weather reporters, they are hardly ever right and they get paid for it.  But I digress.

I did, however,  find one expert that is not surprised by the numbers. Here is a portion of what he said in August: 

“The housing sales numbers will continue their upward trend, and may even accelerate through the end of the year as last minute first time home buyers scramble to close escrow by November 30, 2009.  Should Congress choose not to extend the credit deadline we will probably begin to see a trailing off of  the sales pace toward the middle of spring 2010.”

“Even with an extension of the credit there may still some sales softness, as first time buyers can only drive this market so far. In what we used to call a “normal” market, nearly all purchases of existing homes ended up being actually more than one home purchased, as the buyer was buying a home from a seller who was buying a replacement home for themselves. In today’s market over 1/2 the transactions involve foreclosed homes or short sales where the seller ends up with nothing to buy a replacement home with.”

Click Here to view the rest of the expert’s comments.

Remember that during the “dark days” of the market when it seemed that everyone was saying the collapse of the real estate market was leading us into the next Great Depression? At the same time I was advising you to take the predictions of gloom and doom with a grain of salt and keep your perspective on what was really going on.

I am advising the same thing now. While these are impressive numbers, they are numbers mostly driven by the federal first time home buyers tax credit, the Cash for Clunkers for the housing industry. To provide the perspective on this look what happened after the Cash for Clunkers program ended; auto sales dropped by up to 50% for some auto makers. There is still some heartburn to go through as we climb out of the hole created by the explosion of the bubble. Hopefully, while making the ascent we don’t find ourselves on a slippery slope that is sometimes created by government bailouts.

Paradise homes for sale, chico listings, gridley properties, butte county real estate, Oroville homes

With apologies to Shakespeare, that is the question in this economy.

During any economic downturn the conversation among many of the talking heads in the media inevitably turns to consumer spending. Since we consumers make up 70% of the economic activity in this country it only stands to reason that our spending habits are scrutinized by students of the economy.

Up until this economic downturn consumer spending was off the charts. We could not get enough of anything. We did cash-out refinances to buy cars, boats, RV’s, ATV’s, and whatever other toys we could think of. We ran up credit card balances like the world was going to end tomorrow. It did not matter if we needed it, we WANTED it, that is what mattered most.

As this trend continued we began hearing some analysts worry that consumers were overextending themselves and that credit was being used beyond anybody’s ability to pay it back. And not to mention, they said, the long term economic health of this country is being threatened by the low savings rate that we have. As a financial advisor for a major Wall Street brokerage firm in the earlier part of this decade I witnessed first hand the result of the poor savings rate. I can not tell you how many people in their late 40’s to early 50’s I met with in my office who, realizing that their  retirement  years were staring them in the face, wanted to START a retirement fund. And by the way they want to retire at age 65!!!! You can probably imagine the reaction when I told them that the only way that could happen is if they put $30,000 to $40,000 away per year until they retire. That’s right, IT AINT GONNA HAPPEN!

So now along comes a pretty severe recession. And just as the experts feared, the low savings rate among consumers has left many with no reserve on which to fall back. Many of these people may still be in their homes today if they had established a “rainy day fund” to weather this economic monsoon we are going through.

Today though, the silver lining of this recession is beginning show through. The latest reports show that the savings rate is near historical highs and that consumers have paid down over 12 billion in debt. The reports also show that more people are ditching their credit card in favor of their debit cards. In other words, consumers are slowly beginning to live within their means. Good news, right? 

WRONG…….At least to some who now say that the consumer must spend more to get us out of this recession. In fact, some say, it may not be a bad idea to use that credit card to get things rolling a little bit. In other words, we are now saving too much.

So what is a consumer to do? 

For me personally, I am working on paying my credit cards off so I can shred them. I have already changed my spending habits to spend no more than we make each month and trying to get that rainy day fund going. You see, except for the retirement fund, I have been just like nearly everyone else. Spending more than I should and saving a whole lot less that I need to be.  If switching to a saver from a spender slows down the economic recovery then I guess the economy is just going to have to wait. There are more downturns to come in the coming years as the economy goes through its natural cycles and I want to be better prepared.  How about you?

OROVILLE REAL ESTATE HOMES FOR SALE LISTINGS CHICO HOMES PARADISE HOMES

Host:  Welcome everyone, to the premiere of America’s newest blog show, Who Not To Trust. Where we interview some of the most unsavory people in the the real estate business. Today’s show is coming to you from the real estate market of  just about Anywhere USA.

Today’s topic: How some  buyer’s agents are putting their commission ahead of their duties to their clients.

Our special guest today is one of the areas self-proclaimed “top producers” of real estate for buyers, Mr. I.B. Greedy.

Host: Welcome I.B.

Greedy: Oh, please,  just call me Greedy.

Host: Ok, Mr. Greedy, welcome to today’s show. My sources say that you have devised a new way of increasing your commission in this very difficult market .

Greedy: Well yes, as a matter of fact I have. But how did you find out about it?  This was supposed to be a secret among the Greedy family.

Host: I am not allowed to reveal my sources but, trust me, they are very reliable. So tell me about this new plan.

Greedy: Well,  if you insist. Here is how the scam, er, I mean plan works. I am sure that you have heard that appraised values for some homes are coming in less than the contracted purchase price.

Host: Yes, I am aware of that.

Greedy: Then you must also know that an appraisal that comes in short can threaten my deal. In the past there have been three options when this problem arises. 1. The seller accepts the lower price, 2. The buyer agrees to pay the higher original contract price, or 3. The transaction is cancelled because neither party budges.  Recently, though, we have resurrected a long forgotten 4th option.

Host: What would that be?

Greedy: Finding a way to get the appraised value increased by researching comparable sales to see if there are any sales that the appraiser may have missed that would support a higher value.

Host: So the seller’s agent does this research right?

Greedy: No, I do it too.

Host: But you are representing the buyer, right? 

Greedy: Right!

Host: Do you tell your buyer when the appraisal comes in low?

Greedy: Only if I can’t figure out a way with the seller’s agent to justify a higher value.

Host: You mean you “conspire” with the seller’s agent to come up with a higher value.

Greedy: In our family we call it “cooperating”.

Host: So wouldn’t the lower price benefit your client?

Greedy: Oh, sure. But the lower price means a lower commission for me. Or, if the deal dies, I don’t get any commission at all! I can’t let that happen, no matter what.

Host: Don’t your ethics……

Greedy: My what?

Host:  Your ethics.

Greedy: What are those?

Host:  You know, the duty to put your clients needs above all else?

Greedy: Heh, Heh, that’s funny.

Host: So to sum this up, you and the rest of your Greedy family are more concerned about your commission than your clients well being.

Greedy: Yep, you get the picture.

Host: Well, thank goodness your family is small.

Greedy: We’re not a small as you might think!

Host: Well, there you have it folks, another reason to be careful when choosing a real estate agent to represent YOUR interests. Remember, not all REALTORS® are like this, but there are just enough of them that they unfortunately taint the rest of the industry.

OROVILLE REAL ESTATE, HOMES, CHICO, PARADISE, FOR SALE, LISTINGS BUTTE COUNTY, NORTHERN CALIFORNIA, CA

After pausing for a couple of weeks, sales of homes in the Oroville real estate market returned to its previous trend. 

Prices continue to jump all over the board due to the large disparity is prices of homes sold each week. As an example the lowest priced home sale of the week was $35,000 and the highest priced home sale for the week in the greater Oroville area was a sale completed by our own Christi Nelson for $186,000. Great job Christi.

See More By Clicking Here