TeamResults

Fannie Mae & Freddie Mac in conservatorship today!

John Wall (CENTURY 21 Results) — Sun, 07 Sep 2008 14:55:18 -0500

September 7, 2008

The Office of Federal Housing Enterprise Oversight has announced
this morning, it is placing mortgage giants under conservatorship
in an effort to stabalize their ability to perform under tighter
credit restrictions and low economic growth.

OFHEO cited the importance of these organizations and their
role in residential real estate in their press release issued
Sunday morning.

James Lockhart, Director Federal Housing Finance Agency, has taken
steps over the past six months to help stabilize Fannie and Freddie
including reducing capital requirements, removing portfolio caps, and others.

"I have determined that the companies cannot continue to
operate safely and soundly and fulfill their critical public mission".
Lockhart said.

Also released was a conservatorship Q & A which defines the conservators role
as well as the actions they will take.
View the conservatorship Q&A here

John Wall
REALTOR
CENTURY 21 Results

www.TeamResults21.com
TeamResults@CENTURY21.COM

"Fixer Uppers"

John Wall (CENTURY 21 Results) — Sun, 07 Sep 2008 16:49:30 -0500

When I talk to a potential home buyers, the topic of fixer uppers
comes up during the initial consultation almost everytime. It
seems everybody wants a fixer upper these days. Perhaps its the
hope that if property needs a little work, they'll be able to buy
it at bargain. Let me say that; yes sometimes you can get a bargain
if you're willing to get your hands dirty. But more often than not,
buyers don't really 'want' a fixer, especially after I show them a few.

What buyers really want is a bargain. What constitutes 'a bargain' can
vary greatly from one property to another, and also among different buyers.
Different neighborhoods can affect the perception of a bargain too. In my
Long Beach neighborhood we have quite a few homes well over the $1 million
price range. Spending a million dollars on a home might not seem like a
bargain to most buyers but if that home is surrounded by $3 million dollar
homes then suddenly that million dollar home starts looking like a steal.

I would like to take a few moments to look at some myths and facts about
fixer uppers in our marketplace. Obviously some points may not be true
100% of the time, but overall - I think they hold up. Understanding these things will
help buyers make better decisions and yield a higher satisfaction regarding
their purchase over the long run.

Myth
I can get a fixer that only needs minor repairs
Fact
A home that only needs 'minor repairs' isn't a fixer. Its every home on the
market.

Myth
If I do a little paint and landscaping I can save a lot of money
Fact
Yes you can save money by painting and lanscaping yourself. But you wont
save much on the purchase. Every home needs a little TLC, and cosmetic
changes. Thats what people do when they buy a home - They customize it
to fit their own lifestyle and design ideas.

Myth
This home needs a new roof, plumbing repairs, and new windows or doors. Its 80,000
less than the one next door. Lets buy it!
Fact
Yup! You just paid 80,000 less than everyone else on the block. You might have
also just bought a money pit. The need for extensive repair work often indicates
hidden problems that may cost so much that what you saved is now irrelevant.

You can see where this list is going, and just like the energizer bunny,
it keeps going, and going, and going...

One lesson to learn from these examples is spending more initially, may be
the best way to get a bargain in the long term.

If I've turned you off of looking for bargains or fixers, that wasn't my intent.
Lets go over some things I look for when considering a 'fixer upper'.

Outdated fixtures or appliances
updating these yields the highest return when its time to sell

Enough space to add an additional bedroom or bathroom
1. a home that grows with the family will remain useful longer
2. the value of such additions at sale time means higher sale price, and better appreciation

Outdated fascade.
yeah, that remodel job they did in the 70's sure looked great, but now people want
double pane windows, central air, stucco, siding, brick, etc. This situation requires
some consideration because it might mean a big project. But it could also mean instant
appreciation.

Deferred Maintenance.
Not necessarily in need of major repairs, but maybe the paint is peeling, the roof
has some cracked tiles, the T.V. antenna is leaning, sprinklers water the street instead of
the lawn (and speaking of lawns... Is that crabgrass?). You get the idea. This is the stuff
that is fixed with a hammer, screw driver, and a wrench, not a construction crew.

When we're talking about low level things like these, we're not really looking at
huge price reductions, but overall value and ways to help the value increase over
time. Besides a good listing agent has already taken these things into account before
setting the asking price. Getting a credit for this or that, or maybe asking the
seller to complete some repairs before escrow closes might be just as good as paying
80,000 less.

So the next time you call me to look at fixer uppers, let me know ahead of time if what you
really want is a bucket of paint, or a bulldozer. I'm only a phone call away from either!

John Wall
REALTOR(r)
CENTURY 21 Results

www.TeamResults21.com
TeamResults@CENTURY21.COM

Can you think of other 'fixer' myths? How about sharing your 'fixer' stories? Lets hear from you!

Don’t want to pay Capital Gains? There is a way.

John Wall (CENTURY 21 Results) — Sat, 21 Apr 2007 13:43:19 -0500

Within the last 2 years, the IRS has been allowing taxpayers to mix the rules applied to the sale of their principal residence and those of IRC 1031 tax deferred exchanges. A welcome turn in this market where homes values have skyrocketed upward and produced gains well above the current $250,000/$500,000 capital gains tax exclusions afforded by the IRS.

If you don't know already, the IRS allows a seller to exclude from capital gains taxes, upto $250,000 from the sale of his principal residence if he's lived in it for 2 of the last 5 years. ($500,000 if married) Any amount over that would be subject to taxation. So if a seller nets a profit of 350,000, the portion subject to tax would be $100,000.

If the seller can rent the home for 2 years before the sale, that 100k could then be rolled into another investment property and excluded from gains tax. The investment could also produce income for the seller as long as he owns the investment property. That income though, would presumably be taxed at the owner's low income tax rate, not as gains.

Strategies like this can get complicated and before making the decision to make a transaction like this, you should consult with your CPA or Tax Advisor.

Mortgage Scam: Warning

John Wall (CENTURY 21 Results) — Wed, 02 May 2007 09:22:20 -0500

I've just been made aware of an ugly scam that is affecting a lot of people in Southern California and other places. This is an insidious scam that takes advantage of the turbulent finance environment.

Consumer advocates and Mortgage Brokers (the reputible ones) are warning of this fraud where someone, under a false company or individual comes along and claims to be the new servicer of a borrowers loan. The new party will collect as many payments as possible before being discovered and then move on. Borrowers can loose a lot of money to this scam while at the same time, may face foreclosure because their 'real' payments aren't being made.

Its easy to fall for this scam because as we all know, its not uncommon to have a loan change hands several times, over the life of a loan. The way to fight this menace is to call your current lender, using the number on your mortgage coupon or older paperwork, and ask if your loan was sold.

Legally, the old and new lender must notify you in writing when your loan is sold. Verify any documents you receive about a new servicer, and don't trust any contact details is those documents. Use your own resources to contact your lender. If you just start sending payments without checking, you'll likely end up regretting it.

Contact your local law enforcement agency if you become a victim of this scam.

Regards,

John Wall

Are you a real estate investor? The Basics of a 1031 exchange

John Wall (CENTURY 21 Results) — Wed, 14 Nov 2007 17:57:21 -0600

There are generally four types of exchanges that benefit the Real Estate Investor. They are:

Delayed
Simultaneous
Build to suit
Reverse

There is also a method of exchanging personal property, which is usually the case in the sale or acquisition of a business.

The most common exchange is the Delayed exchange. In transacting a delayed exchange, an investor must identify up-to 3 replacement properties, or more if the total value of the replacements do not exceed 200% of the relinquished property. There is a time limit to do this, in order to qualify as a valid exchange. (currently 45 days after close of escrow on the sale of the relinquished property) The investor then has 180 days to close escrow on the acquired property.

The second most common exchange is the Simultaneous exchange. In this exchange, both properties are transferred concurrently. This is a complicated process, and it is wise to enlist the help of an intermediary. The simultaneous exchange is deceptively complex and is not as simple as closing escrow on the same day.

Next on the list is the Build to Suit exchange in which an investor may build new construction or modify or otherwise improve a replacement property. Again, there are time constraints and complex rules that complicate this type of exchange. It also tends to cost more, as there are fees which must be paid up front by the investor. There are many issues to consider prior to entering into this type of exchange. You should seek professional consultation and representation during all phases of this exchange.

Definitely, the most complex exchange is the Reverse Exchange, which allows an investor to acquire a replacement property prior to the sale of the relinquished property. The caveat of course is that the investor is NOT ALLOWED to hold TITLE to both properties at the same time. As with a simultaneous exchange, an intermediary is essential to ensuring a valid transaction.

Please note that; All IRC 1031 exchanges are complicated and you should consult your attorney, accountant, tax advisor, and other professionals before beginning an exchange.

For more information on this or other Real Estate topics, please use our contact form. If you would like a referral to other trusted professionals, just give us a call. Lots of free information on IRS rules can be found on its website at http://www.irs.gov/ .

Everything you ever wanted to know about Real Estate but were afraid to ask: Reverse Mortgage.

John Wall (CENTURY 21 Results) — Thu, 12 Apr 2007 16:49:23 -0500

A reverse mortgage is a way to borrow money against the equity in your home to provide you with tax-free income. You can receive funds in any number of ways including:

Lump sum
Regular monthly payments for as long as you live (or reside in your home)
Monthly payments with a pre-determined cut off date
A line of credit to draw on when you need it
or a Combination of these

A reverse mortgage can enable you to enjoy retirement more, provide some financial cushioning for future emergencies or major expenses, while, allowing you to remain in your home and keep title to it. Being more complicated than a conventional mortgage, a reverse mortgage carries some pros & cons and has different qualifying requirements for borrowers. The most notable requirement is that the youngest borrower must be at least 62 years old when the loan closes.

Some other requirements are that the home must be your primary residents and remain so during the term of the loan, and that existing loans, or mortgages be paid off prior to closing on the Reverse Mortgage. (reverse mortgage funds can be used for this according to cash advance rules).

If you choose to, you can even pay off a reverse mortgage early by refinancing out, or just settling up with the lender. If you should pass away before the loan is paid, your heirs can choose to pay off the loan or sell the property, any proceeds above the loan amount of your home goes to your heirs.

applying for a reverse mortgage is easy, and you can start online. The National Reverse Lenders Association website is a good starting point to gather information from lenders. The URL is http://www.reversemortgage.org/ .

Team Results also has a 12 page pamphlet available that covers in detail all aspects of reverse mortgages. We'll gladly mail a copy or e-mail an electronic version at your request. Send requests to TeamResults@Century21.com. Be sure to include your preferred delivery method.

The Week in Review

John Wall (CENTURY 21 Results) — Mon, 05 Mar 2007 10:34:07 -0600

YOU KNOW WHO IS LOOKING FOR STOCKS? NOBODY! Last week's volatility in the stock market stabbed at the hearts of both the Stock and Bond markets, with home loan rates swinging higher and lower throughout the course of the week. Economic news releases took a backseat to the massive movements in Stocks. Amazingly, when all the smoke cleared, home loan rates were unchanged to slightly improved for the week overall.
What happened? First, remember that the Stock and Bond markets compete for the same investment dollar. This means that when Stocks are worsening and investors are selling off their holdings, some of that money gets moved over into the Bond market, which helps home loan rates improve. And vice versa, when Stocks move higher and investors are buying into the Stock market, some of that money comes back out of Bonds, which causes home loan rates to worsen.
Last week's volatility began with the Chinese Stock market plunging, setting off a string of worldwide stock selling. Our own Stock market was ripe for a reversal lower, and money flowed out of Stocks and into Bonds, helping home loan rates improve. The next day, Stocks began to rebound, moving money back out of Bonds and causing home loan rates to worsen. But the "see-saw" action continued for the balance of the week - and may not be done yet, causing high amounts of volatility in Stocks and Bonds - and therefore, home loan rates.

Compiled by TeamResults Affiliates as a service to our clients. Always seek advice from your own experts. E-mail TeamResults@Century21.com with questions, comments or concerns.

Return of 'the gold'.

John Wall (CENTURY 21 Results) — Sun, 29 Jul 2007 09:28:21 -0500

Have you heard the 'gold coat' is coming back? But at least this commercial won't be. :). If you need a little gold, you can count on us. e-mail or call TeamResults for your real estate needs in Long Beach and surrounding communities. TeamResults@Century21.com or (562) 433-1914. Or visit my website www.teamresults21.com

Attention Long Beach Landlords & Tenants; Free Event

John Wall (CENTURY 21 Results) — Mon, 30 Jul 2007 08:15:36 -0500

The City of Long Beach's Neighborhood Resource Center (425 Atlantic Ave., Long Beach) will be hosting a FREE workshop for local tenants and their landlords. The workshop will be Wednesday August 1st, 2007 from 6:00pm to 8:00pm and there will be refreshments available.

Presented by the Fair Housing Foundation, Dispute Resolution Services, and Legal Aid Foundation; the event will cover landlord & tenant rights (responsibilities) as well as fair housing issues.

Everyone who rents or owns a rental should attend these types of events when they come up. In the ever changing legal climate its important to stay informed of changes in the law, as well as brushing up on current trends. If you learn just one thing Wednesday evening attending this free event will be worth while.

If you would like to RSVP: E-Mail Sharron_Hinkley@LongBeach.Gov or Call (562) 570-1010.

For Map and Directions Click here.

{Serving Long Beach and surrounding communities}

TeamResults@Century21.com
www.TeamResults21.com

Southern California Houses and Condos in Default

John Wall (CENTURY 21 Results) — Sun, 29 Jul 2007 09:59:31 -0500

County/Region	2006	2007
Los Angeles	4,586	10,393
Orange	1,255	2,984
San Diego	1,778	4,383
Riverside	2,287	6,648
San Bernardino	1,839	5,141

Here are the stats for our investor friends. If you're brave enough to enter the foreclosure market, give me a call and we'll discuss your plan. We have the pre-foreclosure lists available, and they're updated daily. For more information on default/foreclosure activity in Southern California e-mail John.Wall1@century21.com. Don't forget to have a good one!

Ta'

-John

Need Directions for international clients?

John Wall (CENTURY 21 Results) — Tue, 22 May 2007 14:02:56 -0500

Try this... Visit http://maps.google.com.

Once the website loads, Then click on "Get Directions"

In the From section type in "New York" and in the To section, type "London".

The directions are pretty straight forward as you would expect until you scroll down to number 24. That one confused me even though it made perfect sense.

Thanks friends... Have a great day.

Regards,

John Wall
C21 Results

Price Reduction or Seller Credit?

John Wall (CENTURY 21 Results) — Sun, 29 Jul 2007 09:47:13 -0500

When buying a home, borrower's always try to find ways to save. Their first shot is usually asking the seller for a price reduction. Here's a better way;

Example:

(Traditional Sale)

Sales Price $550,000 - 20% Down Payment, $440,000 Loan Amount. 30 Year Fixed Rate at 6.25% = $2,709 payment.

(Price Reduction of $20,000)

Sales Price $530,000 - 20% Down Payment, $424,000 Loan Amount. 30 Year Fixed Rate at 6.25% = $2,610 payment.
(a savings of $99.00 per month)

(Seller Credit of $20,000)

Sales Price $550,000 (with $20k in seller credit toward closing costs) - 20% down payment, $440,000 Loan Amount. 30 Year Fixed Rate at 5.00% (seller bought down rate) = $2,362 payment.
(a savings of $248.00 per month)

for these and other tips on saving money in your next home purchase call on TeamResults. TeamResults@Century21.com or www.teamresults21.com

Which prime are you?

John Wall (CENTURY 21 Results) — Sun, 29 Jul 2007 09:19:07 -0500

Are all sub-prime borrowers, no good, dirty, deadbeats? The term ‘sub-prime' applies to a huge section of borrowers, and sometimes the majority of borrowers in some markets. As Lew Sichelman (LA Times, syndicated author) puts it, a "certain number shouldn't have been approved for a mortgage at any price". Referring of course to the increased media attention placed on the sub prime market of late.

The Mortgage Banker's Association says its difficult to define a sub-prime borrower, but admits that if you (as a borrower) have trouble coming up with one of your mortgage payments this year, you're sub-prime. Though, the association has said that 78% of you sub-prim(ers) are actually making your payments on time and are staying current on your mortgage. There is no avoiding the fact that sub-prime loans have a higher default rate, which is expected to increase in the near future.

In his recent article Lew has categorized the following list of borrower types as sub-prime;

Former Primes: borrower's who have suffered a major life event that has affected their financial position.

Future Primes: Those who have had mistakes in the past, take on higher interest rates or credit repair loans and promise to make payments on time, to once again reach their ‘prime' status.

Rookies: (My favorite kind) These are people who just don't have the funds for a large down payment but, meet or exceed every other qualification necessary for obtaining good terms on a loan.

Second Homers: These are borrowers who were able to qualify for a prime market loan for their first home, but didn't have the credit to qualify for similar mortgage status on their investment or vacation homes. Its estimated that this borrower only makes up 7% of the sub-prime market.

Fraudsters: There isn't much to say about these guys, other than they're crooks.

Ne'er-do-wells: Borrowers with messy financials, rarely pay on time, their approval's were just dumb.

Should Haves: These are folks who really are in the ‘prime' market but for one reason or another have chosen a sub-prime loan. (my experience is that these are the one's whom although, that are able to... they just don't want to put down a huge down-payment..

So which sub-prime borrower are you?

Pricing your home

John Wall (CENTURY 21 Results) — Tue, 13 Mar 2007 16:34:11 -0500

Why is it that some homes sit on the market for a year while others sell like hot cakes? Frustrated sellers will blame a bad market, while a good real estate professional will tell you that many times, a slow sale is often attributed to the listing price.
If a home is overpriced, buyers will stay away. But, if the price is competitive with similar homes in the area and "shows" better than the competition, it will have a better chance of being sold quickly.
The secret is perfecting a technique that's as American as apple pie: comparative shopping. Although comparing houses with different styles, square-footages and locations is challenging, real estate professionals still feel it's one of the best methods to use when determining a home's market value.
A responsible real estate agent will effectively evaluate a home's worth through a process known as Competitive Marketing Analysis (CMA). Taking a look at assets, such as a swimming pool, bigger than normal living spaces, a fantastic view, adjacent city parks and other attractions, the agent will begin to compare your home with similar properties, called "comparables," that have sold in the area within the last six months. Typically, the agent is able to recommend a realistic price range that will ensure you top dollar.
However, factors such as the amount of time needed to sell your home can alter the agent's price recommendation dramatically.
Typically, people should check with real estate agents in the community to determine the average duration that listings are on the market. Sales associates will explain that the marketing "norms" vary with prices and properties. Based on this criteria, the agent feels confident that he or she will be able to sell it for a price that both you and the buyer will be happy with. However, if you're under time constraints because of unexpected job changes or moving agreements you've made on another property, this will narrow your chances of selling the home for top dollar in the market.
Assuming you have sufficient time to market the home, here are a few small steps you and your agent can take to finding the right price for your property.
The best comparisons can be made with similar homes that have been sold within the last 45 days as opposed to the standard six months. Any longer and other factors, such as the economy, could cloud your view of how much your home is really worth.
Another good benchmark is to review the selling prices of homes that have just been sold and are pending closes. Most MLS services provide information on deals pending that most real estate agents should be able to shore with you.
A good rule of thumb before setting a price is to make 20 comparisons of comparable properties within a one-mile radius of your house. Once completed you can feel comfortable that the price you've picked is a good gauge of the home's worth and won't discourage qualified buyers.
Being open and honest about what you see as the home's greatest strengths and biggest weaknesses will also help an agent get a better feel for how to best evaluate (or assess) and market your home. Think of your home as if you were the buyer. If your home is listed at the right price, you're well on your way to a speedy and fruitful sale.
***

A quick market overview

John Wall (CENTURY 21 Results) — Tue, 17 Jul 2007 15:00:26 -0500

7/17/2008

Much of the market information I receive comes from the same sources that everyone else sees. Here's an overview of whats happening in California.

According to DQNews, in California 36,975 new and resale homes were sold in May. Down 31.7% last year.

As of May 2007, the median price paid for a home was 484,000, up 2.5% a year ago, and, the typical mortgage payment borrowers committed to was $2,266. Thats down $46.00 from this time last year.

Market indicators have been all over the place, but its clear that adjustable rate mortgages have become increasingly unpopular. Foreclosure activity has not yet impacted home values in most markets. Down Payment amounts are stable, but investor activity is down.

From all this we learn that changes are taking place, but prices are still going up, and My guess would be that much of the sales decline has to do with potential buyers who are 'waiting to see' whats going to happen next. If you have any questions about local real estate activity, I am always happy to provide answers and share my observations. Please feel free to contact me, john.wall1@century21.com.