THREE AWESOME REASONS TO BUY A HOUSE NOW!

Reason #1 -- According to S&P/Case-Shiller, prices will continue to rise in 2013.  In fact, they adjusted their original forecast of 8% to 11%.  Reason #2 -- Mortgage rates will continue to rise.  According to Freddie Mac, 1/2 a point interest has already been factored in and likely will stay there for the time being.  But don't test providence.  Reason #3 -- It is time to make a decision.  The time for hesitation, waiting for the bottom of the market, has come and gone.

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OC HOMES IN FORECLOSURE DOWN BY HALF

This was the headline in the OC Register on July 11th.  The true number of households in some stage of foreclosure, according to CoreLogic, was 4,300.  This represents a mere 1% of all households, and less than half the number of May 2012, which was 8,900.  Nationwide, 1 million US homes were in the foreclosure process for May, representing 2.6% of borrowers.  That number is down 29% from the previous year.  The point to glean from all that is that OC is stronger than the rest of the country, at least in avoiding foreclosure.  This is mainly a result of the appreciation of the last 2 years pushing more and more homeowners into equity positions, allowing them to either refinance or sell their home without it becoming a short sale, or facing foreclosure.

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PROPERTY TAXES SEE BIGGEST JUMP IN FIVE YEARS

Yes, the notifications from the county tax assessor are making their way to your mail box as this is being written.  The boost is the result of a more robust market, solid appreciation, and new parcels which have sold, including commercial development as well as homes.  Prop 13 only allows 2% adjustment, so long time homeowners may get a notice of a slight uptick, but the most revenue will come from new housing developments, which allow for a fresh tax assessment based on sales price, broken down by land and improvements, and new commercial properties, factories, and shopping centers, to name a few revenue sources.  If you have questions about your tax bill, you should not hesitate to call the Tax Assessor and talk to one of their appraisers.  If you are in OC, you can view your tax bill online.  

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ALL REAL ESTATE LOOKS GOOD 10 YEARS LATER

Many investments, whether bonds, stocks, mutual funds, etc, are bought to hold and in fact become long term investment strategies.  Remember, we have been desensitized these past 10 years from one extreme to another.  First, from 2002 to 2006, the public saw real estate as a means to get rich quick. Investment  for  the short term.  Sadly, many people got caught holding the bag, and lost a lot of money, trying to make real estate something in their investment portfolio, it was never meant to be.  Then the other extreme hit, of no one wanting properties except the heartiest, cash flush, investor.  But if you take10 years, any 10 year period, after the great depression, there is no time that real estate did not do well.  Food for thought.

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THE HOUSING MARKET HEATS UP

Let’s start with a quote from a veteran real estate analyst of Southern California, G.U. Krueger, “If home prices and jobs are an indication, prosperity may be re-emerging in California”. In fact, according to analysts with Clear Capital, home prices in February this year grew by double digit rates from a year ago in nearly every metropolitan area deemed important for statistical reasons. Probably some of the best news was that inland areas, hard hit by the foreclosure and short sale wave, also showed serious growth and promise. This is significant because jobs in these regions are more about growth stability, workers and manufacturing as opposed to high tech and Internet or stock market; job divisions sometimes seen as leading vocations along the coast.

UCLA also posted predictions that Orange County would see strong gains and continuing job growth. Their current prediction is that OC should return to pre recession job levels around 2016. Unemployment is expected to drop to 6.8% this year compared with 7.6% a year ago and level off at 4.6%. In 2016.

No doubt everyone has read about or personally experienced the tight inventory, yes a serious lack of homes for sale. Not only is the desire to buy right now so high because of the low prices, signaling the bottom of the market that we hit last year; but also, more importantly, is the historically low interest rates. These rates are allowing the buying public to get up to as much as 30% more house for their money with no fear of a bubble. WHY?...Because these are real loans for people who have been strenuously qualified. If you have gotten a home loan recently, you know that this is true. That is real qualification and the loans being fixed versus ridiculous stated loans and interest only 3 year adjustables, which have gone by the wayside, thankfully. Now is the time to try and find and buy your dream home.

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FEWER FORECLOSURES DOT THE HOUSING LANDSCAPE

The number of OC homes facing foreclosure fell 55% over the previous 9 months ending in February, a decrease of nearly 5,000 properties that were previously in some form of foreclosure, according to CoreLogic. Another data provider, DataQuick, had a similar report. Southern California, comprised of Ventura, LA, San Bernardino, Riverside, Orange, and San Diego counties, reported 20,879 Notices of Default for 4th quarter 2012 as compared with 34,013 for the same period 2011. Orange county went from 4,297 to 2,169 and that is how the 55% decline is figured. Part of the decline is in response to new foreclosure laws which require an additional 30 day warning period in writing before the NOD can be placed on a property. Lenders are preferring to have properties go through a short sale. Thankfully, lenders are catching up with the learning curve and most now have procedures in place which actually can expedited the short sale process.

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WHAT WERE THE ACTUAL NUMBERS

The total number of sales in Southern California was 15,945. The overall median price was $320,000 which is up 20% from the $264,750 of a year ago for the same month. (February is the latest full month available for statistics). Orange County had total sales of 2,252 which was up in sales volume by 6.7%. However pricing was up overall 22.3% with the median overall hitting $477,000. Part of the reason for the large gain, however, is lost when you just look at statistics. Last year, 2012 saw mainly investors flipping houses and cashes buyers buying distressed properties to flip. The market was largely devoid of the upper end seller or buyer. They are now back in force and so some of the price hike should not be seen as a worrisome bubble, but rather a welcome addition to the real estate market of 2013. Every county posted sales volume gains of around 5% except the Inland Empire, which lost a little ground. Every So Cal county posted double-digit pricing gains.

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