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Tuesday, January 29, 2013

Mortgage debt relief extended for homeowners

Mortgage debt relief extended for homeowners

A law that gives financially strained home-sellers tax relief on forgiven mortgage debt has been extended through 2013 as part of “fiscal cliff” talks.

Thursday, January 24, 2013

Luxury home sales soared in final months of 2012

Sales of luxury homes spiked in the final months of 2012 as high-end homeowners rushed to take advantage of lower tax rates before January 1.

According to the National Association of Realtors (NAR), sales of homes valued at $1 million or more spiked 51% in November compared with a year earlier.

Looking ahead, all those rushed deals could mean a slight slump in high-end sales early in 2013. Not only will buyers be in shorter supply but the inventory of luxury homes has dropped precipitously.
                                        
But I think the drop-off will be short-lived. Historically low interest rates should continue making the long-term cost of buying these homes attractive to buyers. In addition, foreign buyers continue to invest in U.S. properties and many domestic buyers are starting to come off the sidelines now that home prices are starting to recover.

Saturday, January 19, 2013

Realtors Report Multiple Offers, Quick Sales but Continuing Appraisal and Credit Issues

Realtors Report Multiple Offers, Quick Sales but Continuing Appraisal and Credit Issues


Shadow inventory is still high, but it is about 1 million fewer homes than two years ago. Decreases in sales inventory and a decline in the distressed home sale of existing home sales are projected to lead to continued market improvement.

The incidence of multiple offers has led to shorter marketing time and approximately a third of respondents noted that 57 percent of properties were sold within 3 months and many in less than a month. Only 20 percent of Realtors reported selling houses that had been on the market for six months or more compared to 28 percent a year ago. The median marketing time in November was 70 days compared to 98 days in November 2011. Even the timeline on short sales while still protracted has dropped from a median of 119 days one year ago to 90 days.

About 22 percent of respondents reported they had sold a foreclosed or short sale property and that cash sales accounted for about 46 percent of those sales compared to 41 percent in October. Distressed properties sold on average at a 20 percent discount and short sales at a 16 percent discount. Discounts were strongly affected by property condition. Those of above average condition sold for a 13 to 15 percent discount while those in the poorest condition were discounted 34 to 38 percent.

Approximately 30 percent of respondents who made a sale reported cash sales in November with most reported to be investors and international buyers. Approximately 9 percent of first-time homebuyers paid cash, compared to 70 percent of investors who paid cash. A sale to a first-time buyer was reported by 30 percent of Realtors, well below the 40 percent share historically enjoyed by novice homebuyers. Respondents noted that this reflects the difficulty in securing mortgage financing, delays with short sales, and purchases of lower priced properties by investors. 


Realtors also noted that appraisals continue to be a problem because values are not keeping pace with the appreciation in market values. Realtors complain that appraisers continue to use foreclosures as comps and they are encountering out-of-area appraisers who do not know the local market. They also expressed frustration at the slow turn-around time and appraisal requirements that are an unnecessary expense on the buyer.

Friday, January 18, 2013

Lake Wildwood Grass Valley Home and Land Deals of the Week




Active Short Sale - Check comp's,,,,, at this price, this home will go quick!!! Private gated Lake Wildwood community, right off of Lake Wildwood Drive. Oh yea, I forgot,,,,,,, on 2 acres!!! Hugh amount of room, (just shy of 2300 Sq. Ft.) in this 4 bedroom / 4 bath home. Newer, stainless steel appliances, gas range and a massive 2 car garage. Bring an offer!
http://www.idxcentral.com/ncbor/idxsearch.cfm?idxid=gtippner&pg=profile&mls=20130109&cs=any


Active - Looking For Private? Well this is it! Long Range views of the mountains. The Building Pad overlooks the river "BEAUTIFUL" quiet and peaceful! Drive way cut to building site. Big views. Call for more information. Lots of building locations on this beautiful land. POWER is across the road. Located in Nevada County in Grass Valley area.http://www.idxcentral.com/ncbor/idxsearch.cfm?idxid=gtippner&pg=profileland&mls=20130016&cs=any

Tuesday, January 15, 2013

Monthly rent versus monthly mortgage payments


Monthly rent versus monthly mortgage payments


mortgage rent

Census Bureau, J.P. Morgan Asset Management. Monthly mortgage payment assumes a 20% down payment at prevailing 30-year fixed-rate mortgage rates; analysis based on median asking rent and median mortgage payment based on asking price.

Americans continue to be unable or unwilling to buy a house.  Many still remember what happened in the housing bubble not just a few years ago.

Meanwhile, this the demand for rentals have exploded, so much so that average rents are much higher than average mortgage payments.

Friday, January 11, 2013

Closing Costs, Credits and 1031 Exchanges

Closing Costs, Credits and 1031 Exchanges

One of the most frequently asked questions from clients planning a 1031 Exchange is, “Can I use my exchange funds to pay for closing costs without being taxed”? Although surprisingly little guidance is available in the tax code, there are some rules of thumb that will help clients and their tax advisors determine how best to structure a 1031 Exchange without paying unnecessary capital gains taxes.Closing Costs
Closing costs, for purposes of this article, are defined as all costs associated with the closing of a property that is required to complete the transaction. Such costs are required to be disclosed to all sellers and buyers of real property in the HUD-1 Closing Statement. Any cost that is incurred outside of escrow or the closing process generally should not be paid for using 1031 Exchange funds, unless the exchange client is willing to pay tax on the amount spent. Such pre-closing items include all maintenance and fixer costs that are incurred to prepare the property for sale. In addition, exchange clients should not be reimbursed for such costs in escrow without being taxed. It is best to pay for such pre-closing costs “out of pocket”.

For costs that are part of the escrow or closing, you must separate each item into two basic categories.
First are costs that are non-recurring and specifically related to the closing. Such costs can generally be paid for using exchange proceeds and will reduce the property’s net sales price for sellers or increase the net purchase price for buyers. A non-inclusive list of such costs includes:
  • Sales commissions
  • Title and escrow fees
  • Recording fees
  • Transfer Taxes
  • 1031 Exchange Intermediary fees
The second category of items include the costs that are either recurring or do not specifically relate to the closing. Such costs should not be paid for using exchange proceeds without incurring a tax liability. When selling property, such costs should be paid for “out of pocket”. When buying property, such costs should either be paid for with loan proceeds, if possible, or “out of pocket”. These costs also do not decrease the net sales price or increase the net purchase price. A non-inclusive list of such costs includes:
  • Mortgage interest
  • Mortgage prepayment penalties
  • All prorated expenses including property taxes, utilities, homeowner’s fees and insurance expenses.
Seller and Buyer Credits
One other item that frequently shows up on closing statements and the list of most frequently asked questions involves seller and buyer credits. Such items do not require a payment, the way an invoiced cost would. When a seller is given a credit by a buyer, it will increase the net purchase price. When a buyer is given a credit by a seller, it will decrease the net sales price. It does not matter what the credit is for. For instance, if a seller credits the buyer for “closing costs”, that credit will reduce the net sales price, as if the seller had paid the closing costs themselves.

This situation is frequently encountered with buyers who are attempting to acquire replacement property as part of their 1031 Exchange. Let’s say that the buyers need to purchase property for $500,000 to complete their exchange, but really like a property that is worth $475,000. If the buyer acquires the property for $475,000 and completes their exchange, they will have $25,000 in exchange boot that will be subject to tax. To try and avoid paying taxes, the buyer offers $500,000 for the property, but asks for a $25,000 buyer credit. Unfortunately, such a credit reduces the net purchase price and the buyer will still have a $25,000 boot and resulting tax liability.
As mentioned in the introduction, there is relatively little guidance in the tax code when it comes to the deductibility of costs associated with real estate closings. A taxpayer involved in an exchange should always discuss the issue of closing costs with their taxpayer. Hopefully, this article has provided some rules of thumb that will make taxpayers more knowledgeable when discussing the matter and planning their exchange with tax counsel.

Wednesday, January 9, 2013

VA Loan Helpful FAQ and Checklists


 
 
"PURCHASE MONEY TRANSACTIONS"
580+ Fico ....Zero Down
500 -579 Fico ...10% Down
Streamline Refinances
 
For Borrowers with:
Minimum 660 FICO Score
No Appraisal Required
No Income Documentation
Marginal Credit "OK"
No LTV Restriction
12 Months mortgage rating with no lates
Owner Occupied
Close in two weeks!

For Borrowers with:
620-659 FICO Score
125% LTV Limit
No Income Documentation
Marginal Credit "OK"
No LTV Restriction
12 Months mortgage rating with no lates
Owner Occupied
Close in two weeks!
 

Saturday, January 5, 2013

Housing inventory has fallen to 8 year low, Appraisal Issues to Worsen

OC housing inventory has fallen to 8 year low, Appraisal Issues to Worsen

Beware: The “highest priced offer” may not always be the “best offer”.
In other words be prepared to take several “back up offers” just to be assured your listing closes on time.
Many escrows are cancelling because buyers with minimal down financing (FHA/ VA) do not have the ability to bring in more “cash” when an appraisal comes in “low”. (“Only 1 in 3 buyers can afford O.C. home…OC Register Nov 12).
Lenders only lend on the appraised value of a home …not the agreed sales price.
Although “closed sales” are establishing higher prices throughout OC, asking prices are simply out racing “appraisal values”.
With a shortage of affordable priced listings, this condition will only worsen.
In this morning’s OC Register (Nov 12th Business section) noted real estate writers Jeff Collins writes:OC housing inventory has fallen to 8 year low.
Orange County had just 3,753 homes for sale as of Thursday, the smallest number on the market in the eight years that Steve Thomas of ReportsOnHousing.com has been tracking the county’s housing inventory.
That’s equivalent to one home for sale for every 165 owner-occupied households in the county.
By comparison, the county had nearly 18,000 unsold homes on the market as the recession neared its peak in September 2007 - or one listing for every 35 owner-occupied households.
Thomas said the active listing inventory dropped 24 percent below the prior low established in March 2005, when there were just 4,912 homes on the market.
Listings have been dropping because fewer homeowners are putting their properties up for sale, Thomas said. In addition, the number of bank-owned foreclosures has been dwindling over the past year.
Inventory fell by 290 homes, or 7 percent, in the past two weeks, Thomas said. It’s down 11 percent in the past month.
At March 2005 levels, “everybody had a hard time navigating” the market, with homebuyers competing for the few homes for sale and homes selling almost as soon as the for-sale signs went up.
Now, he said, “everything that is coming on the market below $750,000 that is priced right is absolutely flying off the market.
Buyers are now willing to pay a few thousand dollars above the last closed sale.
Thomas warned, however, that home sellers shouldn’t see the current market as an opportunity to cash in.
“Buyers are not going to pay an additional 10 percent above the last comparable sale because are appreciating at a very slow rate, not thousands of dollars every month”.

Thursday, January 3, 2013

Grass Valley Nevada City Hot Homes and Land of the Week


The Wolf Estates-Build your dream home on this 3.09 acre lot in this beautiful country subdivision of 1.67 to 4.23 acre lots. Enjoy the treed pastoral views in the rolling Sierra foothills of Grass Valley. Centrally located just minutes from Placer Cnty, Grass Valley, NV City & Auburn. 17 lots total. Lot has capped well, P&M report, power in street & phone in process. Prop owners have access to over 37 acres of natural open space. If you are looking for the perfect place to build your Dream Home...
http://www.idxcentral.com/ncbor/idxsearch.cfm?idxid=gtippner&pg=profileland&mls=1044434&cs=any



Beautiful parcel, overlooking a gorgeous valley. Very conveniently located in a neighborhood of nice homes. P & M for standard system done in 2000.
http://www.idxcentral.com/ncbor/idxsearch.cfm?idxid=gtippner&pg=profileland&mls=1041772&cs=any



Close to town, La Barr Meadows access, Seperate 10.02 acre parcel also available. Possible subdivision or single family home site. Nice building site w/views. Natural gas & treated water available. Abandoned gold mine on property.
http://www.idxcentral.com/ncbor/idxsearch.cfm?idxid=gtippner&pg=profileland&mls=1037622&cs=any

Wednesday, January 2, 2013

Wait Times for BK and Short Sale Sellers re-entering the Market

 
"Wait Times" for Bankruptcy and Short Sale Sellers re-entering the Market


 Many buyers have been sitting on the sidelines while thier credit scores (and their careers) recovered.
There are specific nuances that apply in each situations.
In the case of these borrowers...it is imperative the borrowers begin the loan application process at least 60 days before writing offers on property in order to avoid any last minute surprises.
Here's a GENERAL breakdown of wait times
FHA:
Chapter 7: 2 yrs.
Chapter 13: 2 yrs.
Foreclosure: 3 yrs.
Short Sale: 3 yrs.* Unless borrower was not late prior to short sale (on ANY obligation) and was not trying to take advantage of the market. For specifics click here.
VA:
Chapter 7: 2 yrs.
Chapter 13: 2 yrs.
Foreclosure: 3yrs.
Short Sale: 3 yrs.
VA High Balance:
Chapter 7: 7 yrs.
Chapter 13: 7 yrs.
Foreclosure: 7 yrs.
Short Sale: 7 yrs.
Conventional:
Chapter 7: 4 yrs.*
Chapter 13: 2 yrs. from discharge date or 4 yrs. from dismissal date*
Foreclosure: 7 yrs.*
Deed in Lieu: 2 yrs. if subject loan is 80% ltv or less
4 yrs. if subject loan is 90% ltv or less
7 yrs. if subject loan is over 90%ltv
Short Sale: 2 yrs. if subject loan is 80% ltv or less
4 yrs. if subject loan is 90% ltv or less
7 yrs. if subject loan is over 90% ltv
BK Chapter 7: a four year waiting period is required measured from the discharge date or dismissal date of the BK. A 2 yr. waiting period is permitted if extenuating circumstances can be documented.
BK Chapter 13: a four year waiting period is required for a Chapter 13 dismissal. A 2yr. waiting period will be permitted with extenuating circumstances.
Multiple BK filings: for a borrower with more than one BK filing in the last 7 years, a 5 yr. waiting period is required.
Foreclosure: A 7 year waiting period is required, and is measured from the completion date of the foreclosure sale date.
A 3 yr. waiting period is permitted if extenuating circumstances can be documented and the ltv rules are applied, MUST to be a purchase of a principle residence or a limited cash out refi on an owner occupied, second home or non-owner.
*What are extenuating circumstances: they are non-recurring events that are beyond the borrower’s control that result in a sudden, significant and prolonged reduction in income or a catastrophic increase in financial obligations.

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