I'd wait if I were you; unless you can get the house for about 30% less than asking. This will absorb the inevitable loss in value the WILL happen in the next 2-5 years...
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The
California Realtors have their December numbers out. “Home sales decreased 15.3 percent in December in California compared with the same period a year ago, CAR reported today.”
“‘Year-over-year sales declined in most regions last month,’ said C.A.R. Chief Economist Leslie Appleton-Young. ‘The price picture across the state continues to be mixed. Increases were strongest in urban areas that experienced relatively less new home building or strong economic growth in recent years. Prices were weakest where there has been robust home building activity or in those areas of the state that were popular with second-home buyers.’”
The
Press Democrat. “The number of default notices lenders sent to Sonoma County homeowners more than doubled in the fourth quarter of 2006, compared with the same period in 2005, and was the highest in nearly a decade, according to DataQuick.”
“‘We’re in the midst of an adjusting market right now, and we won’t know until spring or summer if this is ominous or not,’ said Marshall Prentice, DataQuick’s president.”
“Just over half of the loans that went into default statewide during the fourth quarter were made between January 2005 and February 2006. So those loans were made to buyers purchasing homes around the time the market was peaking in summer 2005, DataQuick analyst John Karevoll said.”
“‘Just because of the higher-priced homes, that is the product that is in demand in order to qualify,’ said Colleen Oller, real estate loan officer for Exchange Bank. ‘But now we’re seeing a downside to that, especially if they’re needing to sell. The value of those homes is not what they paid for them and they’ve got no equity built up.’”
The
Contra Costa Times. “In the last quarter of 2006, about 1,000 more mortgage default notices than last year went out to Contra Costa County homeowners, a 179 percent increase.”
“An additional 700 showed up in Alameda County (a 157 percent uptick) and 500 more (or 163 percent) went out in Solano County, signaling the highest rate of foreclosure activity ever for Solano County and the highest since 1998 for Alameda County, DataQuick reported.”
“Ed Jeffry, a loan consultant in Walnut Creek said that in the past few months four lenders he has used have stopped providing home loans. The quality of applicants has deteriorated, and he is referring many of his clients to bankruptcy attorneys, he said.”
“Many succumbed to the lure of easy home equity or low payments. ‘For so long people have relied on the advice of the guy who used to sell shoes at Payless who now sells loans,’ Jeffry said.”
The
Santa Cruz Sentinel. “Mortgage defaults in Santa Cruz County jumped 36 percent last year, part of a statewide trend. ‘It’s crazy out there,’ said Liese Varenkamp, publisher of the Santa Cruz Record. In the first two weeks of the new year, 16 foreclosures have already taken place, up from two last year.”
“‘Look at that difference,’ Varenkamp said, adding the 80 percent of the homes go back to the bank that made the loan.”
“The 37,273 default notices mailed between October and December was up 145 percent compared to 15,196 in the same period in 2005. Most of the default notices were sent to Southern California addresses, with homeowners in Los Angeles County receiving the largest number of notices.”
“About 32 percent of homeowners who had previously been in default lost their homes to foreclosure in the fourth quarter, up from 8 percent in the same quarter of 2005, DataQuick said.”
“The number of foreclosed homes last quarter was 6,078, compared with 874 in the fourth quarter of 2005 and 3,435 in the third quarter of 2006, the firm said.”
Inside
Bay Area. “In San Joaquin County, default notices hit a record high. Some 1,293 homeowners received default notices, compared with 464 a year earlier. San Joaquin County’s increase in foreclosure notices is partly linked to speculators who are finding it difficult to sell homes in today’s slowing market, said broker Renee Becker.”
“‘The market has turned, so maybe (speculators) have not been able to sell the homes,’ she said. ‘They are stuck with them.’”
The
Sacramento Bee. “Hundreds of Sacramento-area homeowners who missed their first mortgage payments early last year fueled the region’s most dramatic rise in home foreclosures since the 1990s during the fourth quarter of 2006.”
“The 865 fourth-quarter foreclosures compare to 63 the same time last year in Amador, El Dorado, Nevada, Placer, Sacramento, Sutter, Yolo and Yuba counties. ‘What’s the old saying? ‘The chickens are coming home to roost,’ said John Arvanitis, president of Sunrise Vista Mortgage Corp.”
The
Merced Sun Star. “In Merced County, homeowners received 466 notices last quarter, up from 118. That’s a rise of 294 percent, second highest in the state. Lenders also warned a record 909 Stanislaus County homeowners in the last three months of 2006 that they are at risk of foreclosure. That’s an increase of 471 percent, highest in the state.”
“Rick Seymour, House Mart branch manager in Merced, said the rush among homeowners to buy into the housing market before they were priced out is a major cause of the foreclosure rate doubling. ‘The problem was that the market turned,’ he said. ‘When they paid top dollar, and then turn around and it’s $30, $40, $50,000 less, they aren’t going to be too motivated to make those payments.’”
“‘If you are making $5,000 a month, you don’t want a $3,000-a-month house payment,’ he said. ‘I knew three years ago that this would happen based on the people who were buying.’”
“Merced County Association of Realtors President Scott Oliver said many Bay Area families already stretched thin invested in Merced County homes and took out questionable loans. ‘I believe that a lot of loans went into place that should not have happened,’ he said. ‘It was inevitable that with the market exploding the way it did that you’d see a high rate of foreclosure.’”
The
Fresno Bee. “Foreclosures in Fresno County more than quadrupled in the fourth quarter from last year, a sign, analysts say, that a day of reckoning is coming for thousands of home buyers who used unconventional loans.”
“‘This is just the first wave,’ said Shannon Martin of Mid-State Realty in Fresno. ‘Within the next few years, you’ll see more foreclosures coming.’”
“Locally, real estate agents and credit counselors have seen huge jumps in foreclosure-related activity. Martin, who specializes in selling foreclosed properties for lenders, said such listings he handles climbed from 10 to 70 in the past six months.”
“‘People who bought their houses within the last year or two with zero down are at the high-water mark,’ he said. ‘As the values have decreased, they owe more than the house is worth.’”
“Martin said he has foreclosure listings in all price ranges and geographic areas. ‘I’ve got them from $640,000 to $120,000. They are all over,’ he said.”
“‘It’s no surprise,” said Martha Lucey, VP of a nonprofit credit counseling organization in Fresno. The number of phone calls to her housing credit counselors has increased threefold over the past six months.”
“Many of those families are first-time home buyers who have little or no equity in their houses. Many should have thought twice about buying the house they did, she said. ‘It is wishful thinking,’ she said.”
The
Daily News. “In Los Angeles County, 7,445 property owners received default notices, up an annual 113.9 percent. In Ventura County, 794 property owners received notices, up an annual 204.2 percent.”
“Most of the loans that went into default in the 2006 fourth quarter were made from January 2005 to February 2006. The median age for the loans was 15 months. On primary mortgages, homeowners were a median five months behind on their payments when the lender started the default process. And they owed a median $10,555 on a median $324,000 mortgage.”
“‘It’s what we expected,’ said Jack Kyser, vice president and chief economist at the Los Angeles County Economic Development Corp.”
The
Press Enterprise. “Riverside County saw a nearly 182 percent increase in mortgage defaults compared to the fourth quarter of 2005, while San Bernardino County saw a year-to-year increase of 140 percent. In the fourth quarter, Riverside County recorded 4,631 notices of default. San Bernardino County recorded 3,538 notices.”
“Nancy Herrera, a broker-associate with Corona Mortgage, said she gets requests from people who want to refinance, but who have borrowed to the hilt against the properties and don’t have enough equity.”
“Herrera said in recent years lenders relaxed qualifying guidelines to the point that people with relatively low credit scores could buy a house with 100 percent financing and without documenting their income. She said although lenders have recently begun to tighten their requirements, ‘people are still buying homes they can’t afford.’”
“A nonprofit credit-counseling agency in Riverside handled 10,000 calls about mortgage defaults in 2006, said the organization’s president Dianne Wilkman. ‘And the phone is ringing off the hook this year,’ Wilkman said. Wilkman said nontraditional loans, especially those that originated last year, are driving much of the activity.”
The owner told me the taxes on the property are 18k a year. No brainer IMO to rent here in Florida.
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