Here is a little survey done awhile back that is more notable for the trends uncovered, than for the actual numbers discussed. I pulled this off the official National Association of Realtors website, so many of the prices mentioned reflect national values more than our local California prices. Enjoy!
Mark Thorngren
http://www.markthorngren.com
Home Buyer & Seller Survey Shows Rising Use of Internet, Reliance on Agents
WASHINGTON, January 17, 2006
Technology is transforming how Americans buy and sell homes in unexpected ways, including how they work with real estate agents and brokers, according to one of the largest surveys of real estate consumers ever conducted. The study was released today by the National Association of Realtors®.
Nine out of 10 home buyers use a real estate agent in the search process, but use of the Internet to search for a home has risen dramatically over time, increasing from only 2 percent of buyers in 1995 to 77 percent in 2005; it was 74 percent in 2004. The next largest source of information for buyers is a yard sign, mentioned by 71 percent of buyers.
When asked where they first learned about the home purchased, 24 percent of buyers identified the Internet, up strongly from 15 percent in 2004 and only 2 percent in 1997. Although most buyers use an agent to complete the transaction, 36 first learn about the home they buy from a real estate agent and 15 percent from yard signs; five other categories were 7 percent or less.
The 2005 National Association of Realtors® Profile of Home Buyers and Sellers, based on more than 7,800 responses to a questionnaire mailed to a large national sample of consumers located through county deed records, is the latest in a series of surveys evaluating demographics, marketing and other characteristics of home buyers and sellers.
NAR President Thomas M. Stevens from Vienna, Va., said the findings underscore the complexity of the home-buying process. "Buyers who use the Internet in searching for a home are more likely to use a real estate agent than non-Internet users, and consumers rely on professionals to provide context, negotiate the transaction and help with the paperwork," said Stevens, senior vice president of NRT Inc.
"The real estate industry today bears little resemblance to the way we did business 10 years ago. It is hard to find another industry that has adopted technology so readily to its customers," Stevens said. "Realtors® have invested a lot of time and money in building information technology, and because of these efforts, more consumers than ever are using the Internet in their home search."
The survey shows 81 percent of buyers who use the Internet to search for a home purchase through a real estate agent, while 63 percent of non-Internet users buy through an agent; non-Internet users are more likely to purchase directly from a builder or an owner they knew in advance of the transaction.
"We find that the level of for-sale-by-owners is on a sustained decline and is now at a record low. In addition, a growing share of FSBO properties are not placed on the open market - they're private transactions," Stevens said.
A clear downtrend in FSBOs has been seen since that market share experienced a cyclical peak of 18 percent in 1997. Only 13 percent of sellers conducted transactions without the assistance of a real estate professional in 2005, and 39 percent of those FSBO transactions were "closely held" between parties who knew each other in advance, up from 32 percent in 2004. The FSBO market share was at 14 percent in both 2003 and 2004. NAR began tracking the FSBO market in 1981; the record was 20 percent in 1987.
"In reality, the term 'FSBO' is a misnomer when used to broadly describe homes sold directly by owners. Since two out of five of these transactions are between related parties, and those properties are not placed on the open market, we believe that 'unrepresented sellers' would be a much more accurate term to describe this segment," Stevens said.
The median home price for sellers who use an agent is 16.0 percent higher than a home sold directly by an owner; $230,000 vs. $198,200; there were no significant differences between the types of homes sold. "While many unrepresented sellers are motivated to save on paying a commission, we think the price difference speaks for itself," Stevens said. "Owners without professional assistance also have problems in understanding and completing paperwork, prepping the home for sale, getting the right price and selling within the time planned."
Survey data don't explain the price difference, but Stevens offered some context. "Agents know best how to prepare a home and maximize value, agents provide broader exposure to the market and are more likely to generate multiple bids, and the portion of sales that are between private parties are likely to be at a lower price than those on the open market."
"The housing market today contrasts sharply with predictions a decade ago that the Internet would 'disintermediate' real estate agents, including speculation that NAR membership would fall in half. In reality, it's grown dramatically - selling real estate is not like selling a book or buying an airline ticket," he said.
Realtor.com was the most popular Internet resource, used by 54 percent of buyers, followed by multiple listing service (MLS) Web sites, 50 percent, real estate company sites, 38 percent, real estate agent Web sites, 31 percent, and local newspaper sites, 15 percent; other categories were smaller.
Married couples make up the largest share of the housing market, accounting for 61 percent of transactions. Single women purchase 21 percent of homes while single men account for 9 percent. Unmarried couples were 7 percent of the market, and 2 percent were listed as other. In 2004, single women were 18 percent of buyers and single men were 8 percent.
The typical buyer walked through nine properties, searched eight weeks to buy a home and moved 12 miles from their previous residence. The typical seller placed their home on the market for four weeks, had lived in it for six years, moved 15 miles to their new residence and previously owned three homes, including the one just sold.
NAR's senior economist Paul Bishop said both buyers and sellers use traditional methods to choose a real estate agent. "Word-of-mouth recommendation is the most common way to learn about real estate professionals," Bishop said. "The most important criteria, whether you're buying or selling, are the individual agent's reputation and their knowledge of the local market."
In finding a real estate professional, 44 percent of buyers were referred by a friend, neighbor or relative, 11 percent used an agent from a previous transaction, 7 percent found an agent on the Internet, 7 percent met at an open house and 6 percent saw contact information on a "for sale" sign. Six other categories accounted for smaller shares each.
The most important factor in choosing an agent was reputation, according to 41 percent of home buyers, followed by an agent's knowledge of the neighborhood, 24 percent. In terms of desired qualities in an agent, three categories were rated as very important by more than nine out of 10 buyers: knowledge of the purchase process, responsiveness and knowledge of the market. Of buyers who use an agent, 63 percent choose a buyer representative. Satisfaction with real estate agents is very high, with 85 percent of buyers saying they were likely to use the agent again.
Seller responses are comparable: 43 percent chose agents based on a referral by a friend, neighbor or relative, and 28 percent used their agent previously; 10 other categories were 5 percent or less. Fifty-seven percent of sellers said reputation was the most important factor in selecting an agent, followed by their knowledge of the neighborhood, 17 percent. Eighty-two percent said they were likely to use the same agent again or recommend to others.
Four out of ten respondents are first-time buyers, a finding that is consistent for more than a decade. The median age of entry-level buyers is 32 years, also typical over time, and the household income was $57,200. They made a downpayment of 2 percent on a home costing $150,000, but 43 percent purchased with no money down. Of first-time buyers who made a downpayment, 23 percent received a gift from a friend or relative.
The typical repeat buyer is 46 years old and had a household income of $83,200. They placed a downpayment of 21 percent on a home costing $235,000, but 11 percent of repeat buyers paid cash for their home. In all, 94 percent of buyers and sellers believe their home purchase is a good financial investment.
"To underscore the value of housing as an investment, all you have to do is look at the difference in how repeat buyers purchase their next home - the wealth effect of homeownership provides the greatest source for their downpayment, which is significantly larger," Bishop said. Aside from sellers who pay cash for their new home, 66 use the equity from their previous home for a downpayment.
The most important factors in choosing a location to purchase a home are neighborhood quality, cited by 68 percent, close to a job or school, 43 percent, close to family or friends, 36 percent, and the school district itself, 23 percent; seven other categories were under 20 percent.
NAR mailed an eight-page questionnaire to a national sample of 145,000 home buyers and sellers, based on county records, who purchased their homes between August 2004 and July 2005. It generated 7,813 usable responses; the response rate was 5.4 percent.
The 2005 National Association of Realtors® Profile of Home Buyers and Sellers can be ordered by calling 800/874-6500 or going to the Realtor.org store. The cost is $50 for NAR members and $125 for non-members. It can be ordered on-line at http://www.realtor.org/prodser.nsf/OpenProd?OpenForm&IN=186-45-0506
The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing more than 1.2 million members involved in all aspects of the residential and commercial real estate industries.
For more information, contact:
Walter Molony, 202/383-1177, wmolony@realtors.org
© Copyright NATIONAL ASSOCIATION of REALTORS® I Headquarters: 430 North Michigan Avenue, Chicago, IL 60611 DC Office: 500 New Jersey Avenue, NW, Washington, DC 20001-2020 I 1-800-874-6500License Agreement Privacy Policy REALTOR.com Contact NAR Site Map
Tuesday, October 30, 2007
Friday, October 26, 2007
Green Knolls Tract in TO
I did a Comparative Market Analysis for a friend (and client) of mine in the area just Southwest across the 101 from the Oaks Mall. This is about a quarter mile square area and featrures larger sized “move-up” homes built in the 1980’s. The CMA was done on the 12th of October and included 6 active listings and 9 sold listing covering the previous 12 months of activity.
The Active listings were priced between $594,900 and $799,950. The average days on the market (DOM) is 104 days with prices reduced from an average $756K to and average $716K over that time frame. Keep in mind that these prices reflect back just a bit over 6 months.
The Sold listings went for between $550K and $875K. The average days on the market was 58 days and the average sale price was roughly $728K. The sold listings covered 12 months or an additional 6 months before the Active listings in this CMA. These are averaged numbers.
Sold listings give us the best info and here are four homes of particular interest since they are somewhat close in size and square footage.
In November ‘06 a 5/3 2,600 sq ft home sold in 35 days after reducing from 819K to 816K.
In March a 4/3 2400 sq ft home sold in 151 days after reducing from 764K to 745K.
In June a 4/2.5 3000 sq ft home sold in 116 days after reducing from 965K to 828K.
In July a 4/2.5 2500 sq ft home sold in 77 days after reducing from 815K to 801K.
Compare these homes with 3 homes similar to them in the Active category.
In April a 4/2.5 2,800 sq ft home listed for a 189 DOM and reduced so far from 829.9K to 769.9K
In Sept a 4/3 2,800 sq ft home listed for 36 DOM and has not been reduced so far from 799K
In Sept a 4/2.5 2,800 sq ft home listed for 25 DOM and has not been reduced from 799.9K
Summary: These 3 Active homes are of fairly equal size and are being listed between 770K and 800K.
Referencing the trends from Sold listings, my personal guess is that they will sell between 760 and 780K. If that is true, those homes will represent about a 40K to 50K price drop from homes selling in the same area six months ago. That is about 8K per month drop in prices overall. Not too far out of line with what we have been seeing in other neighborhoods in East Ventura County. Contrast that with some Oxnard neighborhoods where we have seen homes listed a year ago in the 770’s and 780’s now listed for 600K and less!
You are welcome to study other market information and blogs on my website at http://www.markthorngren.com
It is important that you know that I do have time for you, your family, friends and people you like who could use my help right now.
Mark Thorngren
The Active listings were priced between $594,900 and $799,950. The average days on the market (DOM) is 104 days with prices reduced from an average $756K to and average $716K over that time frame. Keep in mind that these prices reflect back just a bit over 6 months.
The Sold listings went for between $550K and $875K. The average days on the market was 58 days and the average sale price was roughly $728K. The sold listings covered 12 months or an additional 6 months before the Active listings in this CMA. These are averaged numbers.
Sold listings give us the best info and here are four homes of particular interest since they are somewhat close in size and square footage.
In November ‘06 a 5/3 2,600 sq ft home sold in 35 days after reducing from 819K to 816K.
In March a 4/3 2400 sq ft home sold in 151 days after reducing from 764K to 745K.
In June a 4/2.5 3000 sq ft home sold in 116 days after reducing from 965K to 828K.
In July a 4/2.5 2500 sq ft home sold in 77 days after reducing from 815K to 801K.
Compare these homes with 3 homes similar to them in the Active category.
In April a 4/2.5 2,800 sq ft home listed for a 189 DOM and reduced so far from 829.9K to 769.9K
In Sept a 4/3 2,800 sq ft home listed for 36 DOM and has not been reduced so far from 799K
In Sept a 4/2.5 2,800 sq ft home listed for 25 DOM and has not been reduced from 799.9K
Summary: These 3 Active homes are of fairly equal size and are being listed between 770K and 800K.
Referencing the trends from Sold listings, my personal guess is that they will sell between 760 and 780K. If that is true, those homes will represent about a 40K to 50K price drop from homes selling in the same area six months ago. That is about 8K per month drop in prices overall. Not too far out of line with what we have been seeing in other neighborhoods in East Ventura County. Contrast that with some Oxnard neighborhoods where we have seen homes listed a year ago in the 770’s and 780’s now listed for 600K and less!
You are welcome to study other market information and blogs on my website at http://www.markthorngren.com
It is important that you know that I do have time for you, your family, friends and people you like who could use my help right now.
Mark Thorngren
Wednesday, October 24, 2007
Personal Comments & Link to CAR Market Review
These days we continue to hear nothing but bad news about the real estate market from our media. Every newspaper, every tv newscast and all the magazines tell us of the difficult times everyone can expect. We have listened to the experts for two years now and watched the falling numbers of homes sold and the rising numbers of foreclosures.
Personally, as a Real Estate Consultant I don’t foresee any overnight changes. However, I do feel that the negative news media feeding frenzy is not helping home buyers and home sellers either. We eventually will see an improving market for both home sellers and buyers. Mortgage programs will become more realistic, interest rates may even be reduced again. Most importantly, home prices will gradually firm again as buyers take advantage of the numerous bargain opportunities available.
When will this happen? If you read the papers, you can predict the answers from the paper or “expert” who writes the article. Next year, the year after? Who knows for sure. I’ve heard that Donald Trump is saying it could be six months. Some realtors I’ve spoken with are predicting next summer at the latest. Many folks are less optimistic. No one has a crystal ball. Two years ago we began to expect a market correction, but who could have predicted all the fundamental changes we are seeing in today’s market.
On the plus side we are expecting large lending limit increases for FHA and CAL-HFA programs. This will recalibrate the definitions for jumbo loans and may make it possible for more folks to qualify for federally guaranteed home loans. The Fed is meeting twice more this year and it is predicted that we will see additional interest rate cuts. There are frequent hints in the newspaper of new federal legislation to relieve some of the difficulties as well. What final shape and extent this federal aid takes will be fascinating to observe.
Home prices are only now beginning to show signs of bottoming out in some of our local market areas. Some folks believe it will be years yet to see a full recovery. I think that different local markets will need different recovery times. One thing I feel certain of, folks will do better if they look at their own needs and match them against the homes available from now on.
Waiting to be told when to buy a stock rarely results in a profit for an investor. You must look and listen and form your own opinion. By the time your newspaper tells you it is safe to go back in the market, you will be six months or a year past optimum and have far fewer homes to choose from. Burn your newspaper! Go online and check your local market for yourself. You don’t need permission from a syndicated columnist!
Here is a link to the slide show presented by Leslie Appleton Young who is the Chief Economist for the California Association of Realtors at their convention two weeks ago on the 10th of October.
http://www.car.org/library/media/papers/pdf/10-10-07EXPOForecastLAY.pdf
(Press CTRL and click if the link doesn’t come up just by clicking it)
For more observations and surveys you are welcome to visit my website blogs at http://www.markthorngren.com/
Warmest Regards,
Mark Thorngren
Personally, as a Real Estate Consultant I don’t foresee any overnight changes. However, I do feel that the negative news media feeding frenzy is not helping home buyers and home sellers either. We eventually will see an improving market for both home sellers and buyers. Mortgage programs will become more realistic, interest rates may even be reduced again. Most importantly, home prices will gradually firm again as buyers take advantage of the numerous bargain opportunities available.
When will this happen? If you read the papers, you can predict the answers from the paper or “expert” who writes the article. Next year, the year after? Who knows for sure. I’ve heard that Donald Trump is saying it could be six months. Some realtors I’ve spoken with are predicting next summer at the latest. Many folks are less optimistic. No one has a crystal ball. Two years ago we began to expect a market correction, but who could have predicted all the fundamental changes we are seeing in today’s market.
On the plus side we are expecting large lending limit increases for FHA and CAL-HFA programs. This will recalibrate the definitions for jumbo loans and may make it possible for more folks to qualify for federally guaranteed home loans. The Fed is meeting twice more this year and it is predicted that we will see additional interest rate cuts. There are frequent hints in the newspaper of new federal legislation to relieve some of the difficulties as well. What final shape and extent this federal aid takes will be fascinating to observe.
Home prices are only now beginning to show signs of bottoming out in some of our local market areas. Some folks believe it will be years yet to see a full recovery. I think that different local markets will need different recovery times. One thing I feel certain of, folks will do better if they look at their own needs and match them against the homes available from now on.
Waiting to be told when to buy a stock rarely results in a profit for an investor. You must look and listen and form your own opinion. By the time your newspaper tells you it is safe to go back in the market, you will be six months or a year past optimum and have far fewer homes to choose from. Burn your newspaper! Go online and check your local market for yourself. You don’t need permission from a syndicated columnist!
Here is a link to the slide show presented by Leslie Appleton Young who is the Chief Economist for the California Association of Realtors at their convention two weeks ago on the 10th of October.
http://www.car.org/library/media/papers/pdf/10-10-07EXPOForecastLAY.pdf
(Press CTRL and click if the link doesn’t come up just by clicking it)
For more observations and surveys you are welcome to visit my website blogs at http://www.markthorngren.com/
Warmest Regards,
Mark Thorngren
Sunday, October 21, 2007
Resale Prices at Village at the Park
The Village at the Park development in Camarillo -http://www.VillageAtThePark.com/index.html/
is approaching the final sales stages. We are beginning to see some resale numbers from those homes purchased in the earlier sales years. I have done some comparisons of those homes offered during the last 12 months of activity. These numbers are derived from our local MLS and the Ventura County Coastal Association of Realtors. The comparisons include 68 homes and are broken down into $100,000 increments which run from the lowest priced home at $398,990 which was an expired listing in October of 2006, all the way up to $1,049,000 for a home that is being actively marketed right now. The information presented here does not intentionally include rentals.
This is my own analysis and does not include information on the new homes still being built and offered by the various builders at Village at the Park. I am not affiliated with, nor do I receive any consideration from the various builders, contractors or service related industries at Village at the Park for this analysis. That means I’m getting myself into trouble without help from anyone else! I also caution the reader that although I have been a repeat visitor to Village at the Park, I have never listed a home in that development, and of course most of the sales have been handled by the builders in this relatively new development.
Also, there are several price categories where very few transactions have taken place. My conclusions must be taken with a grain of salt within those categories since each transaction becomes mathematically a major player. I am not considering home upgrades or if a listing might be a short sale. Obviously, these facts can have a significant effect on a home price as well. My remarks are not intended to reflect poorly on the abilities of the listing agents or their clients. That doesn’t mean I won’t poke fun at them. I know they’ll get me back no matter what I say.
There are various categories or sale status terms used for homes listed in the MLS. These are my very abbreviated and marginally accurate definitions for those categories. Each home transaction is very different and sometimes you need a shoehorn to make a specific definition fit. Quotes are from the VCCAR definitions
In all market analysis the best comparible homes are those which have Sold. They are irrefutable evidence of where the market price was at the time the home sold.
Pending or Contingent status homes are of the next most important status since these homes have accepted offers and may soon close escrow and become sold status. Maybe.
Cancelled, and Expired properties I consider failed transactions.
An Expired listing is generally a listing that has timed out. The agent usually will have an agreement - typically up to 6 months to represent the sale of the home. Whatever the agreement states, if the home does not sell in the specified time it usually becomes Expired unless a new listing agreement is made with the seller and the property is re-listed.
A Cancelled listing is a listing which did not make it past it’s listed time frame. There are many reasons this can happen. Poor market pricing – typically a home priced too high for the neighborhood, Seller dissatisfaction with their agent, the failure to meet a condition of sale. “Contract has been cancelled. Check to see if re-listed before calling owner.”
A Conditional Cancellation “is the same as a withdrawal from the MLS. Contract is still in effect.”
A Release from Showing Status According to VCCAR, “this is a temporary withdrawal (clients out of town for a week or two, repairs being made, etc.) The contract is still in effect.”
The Active status is a current listing or sale price of a home on the market. It varies widely depending on if the home is a short sale or foreclosure (usually priced below market for a quick sale), or has been market priced with or without regard to neighborhood short sales. In many cases, it represents the sellers desired sales price without regard to the local market (usually priced too high). Active status homes do reflect market conditions to the extent that you can see how long a home has been offered at a particular price. Presumably the longer a home has been for sale at a specific price, the less accurately it has been priced. As a very rough rule of thumb, you don’t want to see a large gap between the Active price and the Sold price of a similar home sold within a month or two of the Active listing. Why would a buyer pay more for the same home?
*
398 to 500K Homes There are only 5 homes in this price bracket.
Sold - Only 1 home in this price bracket has sold in the last year. It sold in March with 1072 sq ft for 407K. It was on the market for 91 days and was reduced by about $1,000 during that time. Obviously, it was well priced.
Contingent - One 1,553 sq ft home went contingent on 1 Oct for 499,990 after only 12 days on the market. Again this home appears to have been well-priced and the additional 500 sq ft fetched an additional $53,000 or 10k per extra 100 sq ft.
Active – Only 1 home listed. 1135 sq ft for 429K and on the market for 35 days to date. This is 22k above the sale price for the home sold in March that was roughly the same size.
Expired – Two listings expired in of October 2006. A year ago a 1,093 sq ft listing was removed after only 92 days on the market and priced at 421,990. The other listing was removed at 398,990.
Summary: Three of these homes had about 1100 sq ft and were priced from 407 to 429K. The one contingent property was 500 sq ft larger and really belongs in the next price category. The agent was smart and dropped the price into a lower category for a quick 12 day sale. He/she also sold for more - at about 322 $/sq ft compared to the 317 and 319 $/sq ft that two homes are still currently being listed for after 40 days on the market in the 500 to 600k price range. He sold more quickly and at a higher price for his client by dropping his listing into the top of a lower price category. He caught the market as it was dropping!
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501 to 600K Homes There are 7 homes in this price bracket.
Sold – Three homes sold. A 1610 sq ft home sold 24 October 2006 for $599,990 in only 15days. A similar sized home with 1553 sq ft sold in March 2007 for $517,000 in 91 days. This is a market drop of 83K in home prices in just 5 months = over 16k per month from October to March. The third home was a bit larger at 1814 sq ft and sold at the end of August for 600K. This home was originally listed for 745K and took 207 days to come down to the 600k sale price! Obviously, homes will not sell until they find the market price.
Active – Two homes offered. One 1752 sq ft home on the market for 39 days and priced at 559K. The second 1859 sq ft home offered for 44 days at 589K. The second home is significant because it is being offered at 316 $/sq ft versus the 330 $/sq ft of the latest sold property in this price category and is nearly the same size. This might indicate the market is still soft for these homes. That is an 11k lower price in 1 ½ months.
Expired – Two homes expired this year, one 1553 sq ft home in October 2006 after 92 days at 530,990 and one 1920 sq ft home in July 2007 after 120 days at 599K. Actually this second home was originally listed for 650k. If it had been priced at the lower amount from the start it would have had an excellent chance for selling. It was slightly larger and lower priced than the home that did sell at the end of August for 600K.
Summary: These homes ranged from 1553 sq ft to 1920 sq ft and are now listing around 316 to 319 $/sq ft, down from 330 $/sq ft in August. So far we have seen 3 examples of how crucial the effect of proper pricing is on a successful home sale in just these first two price categories.
*
601 to 700K Homes There are 14 homes in this price bracket.
Sold - Nine homes sold. These ranged in size from 1610 sq ft to 2126 sq ft and sold from 615K to 695K. The average price per sq ft is a bit more at 336 $/sq ft and average days on the market (DOM) was 46 days for this group. All of these 9 home sales were in October and November of 2006! No other homes have resold in this price range since the beginning of 2007.
Pending – One 1920 sq ft home pending at 629,500 and reduced from 639K after 149 days. It is currently in escrow at about 328 $/sq ft which averages 9 or 10 $/sq ft higher than the lower priced homes.
Cancelled – Three homes cancelled in July and August this summer. Two identical 1920 sq ft homes listed for 619K and 636.5K and one 1814 sq ft home listed in the stratosphere for 699,900! (Remember the other 1814 sq ft home that sold in the lower price range for 600K?)
Expired - One 2,022 sq ft home was originally listed at 749K and after 183 days on the market it had been reduced to 699K and expired this October. Even at 699K it was priced at almost 346 $/sq ft. or roughly 18 $/sq ft above the current pending property at 328 $/sq ft.
Summary: These homes are really only represented by one current Pending home. If one sale can be depended upon to represent this group, then sale prices should average about 328 $/sq ft in today’s market for homes in the 1600 to 2100 sq ft size range. That is 8 $/sq ft less than what these homes sold for as a group last October and November.
*
701 to 800K Homes There are 16 homes in this price bracket.
Sold - Four homes ranging from 2004 sq ft to 2806 sq ft have sold this year in Jan, May, June and again in August. That’s not exactly a red hot market, but it is better than the other categories for this calendar year. Remember the one pending 1920 sq ft home in the previous lower price category? It is in escrow for 328 $/sq ft. What do you think these homes average per sq ft? The answer is 327.81 $/sq ft!
In all fairness, this is a remarkable coincidence since the home that sold in Jan was at 300 $/sq ft while the home that sold in August went for 361 $/sq ft. There may be some firming of the market in this price range, but let’s see what the Active properties are doing.
Active – Two homes are listed here and provide a real contrast to each other. One home is 2181 sq ft which is about 200 sq ft larger than the latest home sale in this category. It has been priced at 729.9K or just slightly higher than the last home sold at 723.5K. The second home listed is much larger at 2806 sq ft and is listed for 769K. This is just 5K above the same size home which sold in June for 764K. Both of these homes are probably priced just above what the seller actually thinks he will be able to sell for. Since the result would be no actual increase in price from earlier this year, I would hazard the statement that in this price range the market is rather flat with a favorable spike in a recent sales price. That still beats taking a sizeable drop in price.
Cancelled - Three homes in this category. Two homes that were both roughly 2800 sq ft in size were listed at 274 and 287 $/sq ft which is above the 272 $/sq ft of the 2800 sq ft home that sold in June. The other 2181 sq ft home was priced originally at 754.9K and on the market for 128 days. It was eventually reduced to 729.9K and canceled in June. It might have sold if it had been priced there to start with, as it compares favorably with the home that sold in August.
Conditional Cancel - This home is still under contract but has been withdrawn from the market. There was another home that listed in Jan ’07 that was the exact same size and it sold for 795K. It originally listed at 866.5K but within 55 days the agent reduced the home price 71K and caught the market. Not so with our conditional cancel. This home listed originally for 879K some 3 months later. The higher price for this home was presumably because the seller didn’t realize the market was headed down not up! Instead of reducing the home price right away, the home sat on the market for 201 days, gradually reducing in price until conditionally cancelled this month at 759K. Homes are currently listed in this category at 304 $/sq ft while this home was Conditionally Cancelled at about 287 $/ sq ft. That is 17 $/sq ft below the already reduced market price our two active listings represent.
Expired – Five homes in this category. Three of these properties would probably sell if they hung in there for more than 3 months at their final list price. The other two were both listed too high for too long. Sorry if this is a bit abbreviated, but I’d just be repeating my previous discussions for this home status.
Released from Showing - One 2921 sq ft home in this category and priced at 799K it is at 273 $/sq ft which is at the very edge of what these homes sold for in June. In my opinion, a slight price reduction and the home would probably sell.
Summary: This group had the strongest price per square foot and the most sales this calendar year. The smaller 2000 to 2200 sq ft homes are stable around 330 $/sq ft while the larger 2800 sq ft homes are going for a bit above 270 $/sq ft. Outside of those ranges they may have trouble.
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801 to 900K Homes There are 9 homes in the category.
Sold - One 2760 sq ft home sold in 15 days for 829K or 300 $/sq ft. Great Price!
Contingent - Two 3151 sq ft homes which sold for 859K in 53 days and for 879K in 21 days. That is 273 and 279 $/sq ft respectively. Again, very good prices and both sold this month.
Actually, if you look into property history a bit you would see that the home that presumably sold in 53 days was actually previously listed for 133 days at a starting price of 989K! That’s a 130K reduction to get it to market and sold. That’s amazing work by the agent in my book.
Cancelled – There were four properties listed but two were shifted into sold and contingent after reducing their prices. So they were not permanently cancelled. The other two homes were both roughly 2800 sq ft each and within 3 months reduced to a price within 10K of the 2800 sq ft home that did sell. They might have hung in there. 3 months isn’t always enough time to compete, especially if you need part of that 3 months to find the market price.
Expired - Four homes in this category. Originally priced from 859K for a 2800 sq ft home to 969K for a 3417 sq ft home. In my opinion, all of these homes were priced above market for over 120 days each. One home was finally reduced to market but they gave up. The other homes needed a reality check a lot sooner.
Summary: Homes in this category are pending at 860 to 880K for roughly 3200 sq ft. These are especially interesting numbers because these are October 2007 escrows. The slightly smaller 2800 sq ft home sold for 829K in 15 days!
*
901 to 1M Homes There are 11 homes in this category.
Sold – One 3879 sq ft home in this category which sold for 950K or 245 $/sq ft. What a great price. And it sold in 1 day! Last January. Ten months ago.
Active – One 4143 sq ft home listed for 915,990. That’s 221 $/sq ft! Just on the market for 7 days now. Run don’t walk. This is a seriously interesting value.
One 3151 sq ft home is listed for 920K. They have already been on the market for 138 days! That compares with the two 3151 contingent properties in the 801 to 900K category that just went into escrow this month for 859K and 879K.
Cancelled – Three of these homes. One 4147 sq ft home started life at 1M and was finally reduced after 154 days to market price at 915K and they gave up. The other two homes started high and still haden’t found market price when they gave up.
Conditional Cancel – There is one 3151 sq ft home which started at 949K 207 days ago and is now at 909K. Sound familiar? You can tell me what it needs to be at now.
Expired – Four homes listed from 913K to 969K. Three of which were 3500 sq ft and one which was 3129 sq ft. Only the 969K home reduced to close to market price. None of the other homes reduced their prices (which were above market). There was only one way these homes were going to sell and they didn’t reduce their prices.
Summary: Homes in this price range are not extremely difficult to price. However, the owners may have a hard time accepting their real market value. Often, they are investors and cannot afford to accept a lower price. We saw repeatedly that 3151 sq ft homes are selling for 860k to 880K. The 3900 sq ft home sold at 950K in January which is probably above market now. The 4143 sq ft model is listed at about 916k and is probably a very good price. We just don’t have any real comps to confirm it.
1.01M to 1.1M Homes There are 3 homes in this category.
Sold – One 3879 sq ft home sold for 1,011,000 in January 2007. Compare that to the 3879 sq ft home that sold for 950K next door and on the same exact date. $61k difference in price! Somebody was motivated, and yes the lot size was the same.
Active - One 3417 sq ft home has been listed now for 80 days at 1,049,000. This story will probably not have a happy ending.
Expired – One 4115 sq ft home which made it from 1.044M down to 1.017K in 85 days. Close but no cigar.
Summary: The market for many of these homes was much stronger this last January. These homes could sell but I suspect they may be priced according to seller needs rather than according to market price. The last 3900 sq ft home in this price range sold in January for 1.011M and I feel prices may have weakened a bit over the last 10 month period. There is a 4143 sq ft home currently being offered at 916K. I would wonder about anything listing for over 950K.
Conclusion: Among the more moderately priced homes there appears to be a gradual resolution of market pricing. However, it appears that as home prices go up, the willingness of owners to part with them at market price diminishes. I’m sure that the new home builders are offering large home discounts on their brand new homes in order to sell them. This can obviously have an adverse effect on those folks who bought at the top of the market two years ago as an investment. With one or two year selling restrictions just now releasing owners to sell, they probably are finding it difficult to recoup their investments. They may be competing with their own home builders. Many of these investors are going to be unwilling to take a loss and sell at a lower price if they can make their payments for a few more years until their equity builds again. That may be part of the reason for the large number of cancelled and expired listings in the more expensive homes. That is really too bad, because these are beautiful homes that deserve to be filled with appreciative families.
For more commentaries and market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
is approaching the final sales stages. We are beginning to see some resale numbers from those homes purchased in the earlier sales years. I have done some comparisons of those homes offered during the last 12 months of activity. These numbers are derived from our local MLS and the Ventura County Coastal Association of Realtors. The comparisons include 68 homes and are broken down into $100,000 increments which run from the lowest priced home at $398,990 which was an expired listing in October of 2006, all the way up to $1,049,000 for a home that is being actively marketed right now. The information presented here does not intentionally include rentals.
This is my own analysis and does not include information on the new homes still being built and offered by the various builders at Village at the Park. I am not affiliated with, nor do I receive any consideration from the various builders, contractors or service related industries at Village at the Park for this analysis. That means I’m getting myself into trouble without help from anyone else! I also caution the reader that although I have been a repeat visitor to Village at the Park, I have never listed a home in that development, and of course most of the sales have been handled by the builders in this relatively new development.
Also, there are several price categories where very few transactions have taken place. My conclusions must be taken with a grain of salt within those categories since each transaction becomes mathematically a major player. I am not considering home upgrades or if a listing might be a short sale. Obviously, these facts can have a significant effect on a home price as well. My remarks are not intended to reflect poorly on the abilities of the listing agents or their clients. That doesn’t mean I won’t poke fun at them. I know they’ll get me back no matter what I say.
There are various categories or sale status terms used for homes listed in the MLS. These are my very abbreviated and marginally accurate definitions for those categories. Each home transaction is very different and sometimes you need a shoehorn to make a specific definition fit. Quotes are from the VCCAR definitions
In all market analysis the best comparible homes are those which have Sold. They are irrefutable evidence of where the market price was at the time the home sold.
Pending or Contingent status homes are of the next most important status since these homes have accepted offers and may soon close escrow and become sold status. Maybe.
Cancelled, and Expired properties I consider failed transactions.
An Expired listing is generally a listing that has timed out. The agent usually will have an agreement - typically up to 6 months to represent the sale of the home. Whatever the agreement states, if the home does not sell in the specified time it usually becomes Expired unless a new listing agreement is made with the seller and the property is re-listed.
A Cancelled listing is a listing which did not make it past it’s listed time frame. There are many reasons this can happen. Poor market pricing – typically a home priced too high for the neighborhood, Seller dissatisfaction with their agent, the failure to meet a condition of sale. “Contract has been cancelled. Check to see if re-listed before calling owner.”
A Conditional Cancellation “is the same as a withdrawal from the MLS. Contract is still in effect.”
A Release from Showing Status According to VCCAR, “this is a temporary withdrawal (clients out of town for a week or two, repairs being made, etc.) The contract is still in effect.”
The Active status is a current listing or sale price of a home on the market. It varies widely depending on if the home is a short sale or foreclosure (usually priced below market for a quick sale), or has been market priced with or without regard to neighborhood short sales. In many cases, it represents the sellers desired sales price without regard to the local market (usually priced too high). Active status homes do reflect market conditions to the extent that you can see how long a home has been offered at a particular price. Presumably the longer a home has been for sale at a specific price, the less accurately it has been priced. As a very rough rule of thumb, you don’t want to see a large gap between the Active price and the Sold price of a similar home sold within a month or two of the Active listing. Why would a buyer pay more for the same home?
*
398 to 500K Homes There are only 5 homes in this price bracket.
Sold - Only 1 home in this price bracket has sold in the last year. It sold in March with 1072 sq ft for 407K. It was on the market for 91 days and was reduced by about $1,000 during that time. Obviously, it was well priced.
Contingent - One 1,553 sq ft home went contingent on 1 Oct for 499,990 after only 12 days on the market. Again this home appears to have been well-priced and the additional 500 sq ft fetched an additional $53,000 or 10k per extra 100 sq ft.
Active – Only 1 home listed. 1135 sq ft for 429K and on the market for 35 days to date. This is 22k above the sale price for the home sold in March that was roughly the same size.
Expired – Two listings expired in of October 2006. A year ago a 1,093 sq ft listing was removed after only 92 days on the market and priced at 421,990. The other listing was removed at 398,990.
Summary: Three of these homes had about 1100 sq ft and were priced from 407 to 429K. The one contingent property was 500 sq ft larger and really belongs in the next price category. The agent was smart and dropped the price into a lower category for a quick 12 day sale. He/she also sold for more - at about 322 $/sq ft compared to the 317 and 319 $/sq ft that two homes are still currently being listed for after 40 days on the market in the 500 to 600k price range. He sold more quickly and at a higher price for his client by dropping his listing into the top of a lower price category. He caught the market as it was dropping!
*
501 to 600K Homes There are 7 homes in this price bracket.
Sold – Three homes sold. A 1610 sq ft home sold 24 October 2006 for $599,990 in only 15days. A similar sized home with 1553 sq ft sold in March 2007 for $517,000 in 91 days. This is a market drop of 83K in home prices in just 5 months = over 16k per month from October to March. The third home was a bit larger at 1814 sq ft and sold at the end of August for 600K. This home was originally listed for 745K and took 207 days to come down to the 600k sale price! Obviously, homes will not sell until they find the market price.
Active – Two homes offered. One 1752 sq ft home on the market for 39 days and priced at 559K. The second 1859 sq ft home offered for 44 days at 589K. The second home is significant because it is being offered at 316 $/sq ft versus the 330 $/sq ft of the latest sold property in this price category and is nearly the same size. This might indicate the market is still soft for these homes. That is an 11k lower price in 1 ½ months.
Expired – Two homes expired this year, one 1553 sq ft home in October 2006 after 92 days at 530,990 and one 1920 sq ft home in July 2007 after 120 days at 599K. Actually this second home was originally listed for 650k. If it had been priced at the lower amount from the start it would have had an excellent chance for selling. It was slightly larger and lower priced than the home that did sell at the end of August for 600K.
Summary: These homes ranged from 1553 sq ft to 1920 sq ft and are now listing around 316 to 319 $/sq ft, down from 330 $/sq ft in August. So far we have seen 3 examples of how crucial the effect of proper pricing is on a successful home sale in just these first two price categories.
*
601 to 700K Homes There are 14 homes in this price bracket.
Sold - Nine homes sold. These ranged in size from 1610 sq ft to 2126 sq ft and sold from 615K to 695K. The average price per sq ft is a bit more at 336 $/sq ft and average days on the market (DOM) was 46 days for this group. All of these 9 home sales were in October and November of 2006! No other homes have resold in this price range since the beginning of 2007.
Pending – One 1920 sq ft home pending at 629,500 and reduced from 639K after 149 days. It is currently in escrow at about 328 $/sq ft which averages 9 or 10 $/sq ft higher than the lower priced homes.
Cancelled – Three homes cancelled in July and August this summer. Two identical 1920 sq ft homes listed for 619K and 636.5K and one 1814 sq ft home listed in the stratosphere for 699,900! (Remember the other 1814 sq ft home that sold in the lower price range for 600K?)
Expired - One 2,022 sq ft home was originally listed at 749K and after 183 days on the market it had been reduced to 699K and expired this October. Even at 699K it was priced at almost 346 $/sq ft. or roughly 18 $/sq ft above the current pending property at 328 $/sq ft.
Summary: These homes are really only represented by one current Pending home. If one sale can be depended upon to represent this group, then sale prices should average about 328 $/sq ft in today’s market for homes in the 1600 to 2100 sq ft size range. That is 8 $/sq ft less than what these homes sold for as a group last October and November.
*
701 to 800K Homes There are 16 homes in this price bracket.
Sold - Four homes ranging from 2004 sq ft to 2806 sq ft have sold this year in Jan, May, June and again in August. That’s not exactly a red hot market, but it is better than the other categories for this calendar year. Remember the one pending 1920 sq ft home in the previous lower price category? It is in escrow for 328 $/sq ft. What do you think these homes average per sq ft? The answer is 327.81 $/sq ft!
In all fairness, this is a remarkable coincidence since the home that sold in Jan was at 300 $/sq ft while the home that sold in August went for 361 $/sq ft. There may be some firming of the market in this price range, but let’s see what the Active properties are doing.
Active – Two homes are listed here and provide a real contrast to each other. One home is 2181 sq ft which is about 200 sq ft larger than the latest home sale in this category. It has been priced at 729.9K or just slightly higher than the last home sold at 723.5K. The second home listed is much larger at 2806 sq ft and is listed for 769K. This is just 5K above the same size home which sold in June for 764K. Both of these homes are probably priced just above what the seller actually thinks he will be able to sell for. Since the result would be no actual increase in price from earlier this year, I would hazard the statement that in this price range the market is rather flat with a favorable spike in a recent sales price. That still beats taking a sizeable drop in price.
Cancelled - Three homes in this category. Two homes that were both roughly 2800 sq ft in size were listed at 274 and 287 $/sq ft which is above the 272 $/sq ft of the 2800 sq ft home that sold in June. The other 2181 sq ft home was priced originally at 754.9K and on the market for 128 days. It was eventually reduced to 729.9K and canceled in June. It might have sold if it had been priced there to start with, as it compares favorably with the home that sold in August.
Conditional Cancel - This home is still under contract but has been withdrawn from the market. There was another home that listed in Jan ’07 that was the exact same size and it sold for 795K. It originally listed at 866.5K but within 55 days the agent reduced the home price 71K and caught the market. Not so with our conditional cancel. This home listed originally for 879K some 3 months later. The higher price for this home was presumably because the seller didn’t realize the market was headed down not up! Instead of reducing the home price right away, the home sat on the market for 201 days, gradually reducing in price until conditionally cancelled this month at 759K. Homes are currently listed in this category at 304 $/sq ft while this home was Conditionally Cancelled at about 287 $/ sq ft. That is 17 $/sq ft below the already reduced market price our two active listings represent.
Expired – Five homes in this category. Three of these properties would probably sell if they hung in there for more than 3 months at their final list price. The other two were both listed too high for too long. Sorry if this is a bit abbreviated, but I’d just be repeating my previous discussions for this home status.
Released from Showing - One 2921 sq ft home in this category and priced at 799K it is at 273 $/sq ft which is at the very edge of what these homes sold for in June. In my opinion, a slight price reduction and the home would probably sell.
Summary: This group had the strongest price per square foot and the most sales this calendar year. The smaller 2000 to 2200 sq ft homes are stable around 330 $/sq ft while the larger 2800 sq ft homes are going for a bit above 270 $/sq ft. Outside of those ranges they may have trouble.
*
801 to 900K Homes There are 9 homes in the category.
Sold - One 2760 sq ft home sold in 15 days for 829K or 300 $/sq ft. Great Price!
Contingent - Two 3151 sq ft homes which sold for 859K in 53 days and for 879K in 21 days. That is 273 and 279 $/sq ft respectively. Again, very good prices and both sold this month.
Actually, if you look into property history a bit you would see that the home that presumably sold in 53 days was actually previously listed for 133 days at a starting price of 989K! That’s a 130K reduction to get it to market and sold. That’s amazing work by the agent in my book.
Cancelled – There were four properties listed but two were shifted into sold and contingent after reducing their prices. So they were not permanently cancelled. The other two homes were both roughly 2800 sq ft each and within 3 months reduced to a price within 10K of the 2800 sq ft home that did sell. They might have hung in there. 3 months isn’t always enough time to compete, especially if you need part of that 3 months to find the market price.
Expired - Four homes in this category. Originally priced from 859K for a 2800 sq ft home to 969K for a 3417 sq ft home. In my opinion, all of these homes were priced above market for over 120 days each. One home was finally reduced to market but they gave up. The other homes needed a reality check a lot sooner.
Summary: Homes in this category are pending at 860 to 880K for roughly 3200 sq ft. These are especially interesting numbers because these are October 2007 escrows. The slightly smaller 2800 sq ft home sold for 829K in 15 days!
*
901 to 1M Homes There are 11 homes in this category.
Sold – One 3879 sq ft home in this category which sold for 950K or 245 $/sq ft. What a great price. And it sold in 1 day! Last January. Ten months ago.
Active – One 4143 sq ft home listed for 915,990. That’s 221 $/sq ft! Just on the market for 7 days now. Run don’t walk. This is a seriously interesting value.
One 3151 sq ft home is listed for 920K. They have already been on the market for 138 days! That compares with the two 3151 contingent properties in the 801 to 900K category that just went into escrow this month for 859K and 879K.
Cancelled – Three of these homes. One 4147 sq ft home started life at 1M and was finally reduced after 154 days to market price at 915K and they gave up. The other two homes started high and still haden’t found market price when they gave up.
Conditional Cancel – There is one 3151 sq ft home which started at 949K 207 days ago and is now at 909K. Sound familiar? You can tell me what it needs to be at now.
Expired – Four homes listed from 913K to 969K. Three of which were 3500 sq ft and one which was 3129 sq ft. Only the 969K home reduced to close to market price. None of the other homes reduced their prices (which were above market). There was only one way these homes were going to sell and they didn’t reduce their prices.
Summary: Homes in this price range are not extremely difficult to price. However, the owners may have a hard time accepting their real market value. Often, they are investors and cannot afford to accept a lower price. We saw repeatedly that 3151 sq ft homes are selling for 860k to 880K. The 3900 sq ft home sold at 950K in January which is probably above market now. The 4143 sq ft model is listed at about 916k and is probably a very good price. We just don’t have any real comps to confirm it.
1.01M to 1.1M Homes There are 3 homes in this category.
Sold – One 3879 sq ft home sold for 1,011,000 in January 2007. Compare that to the 3879 sq ft home that sold for 950K next door and on the same exact date. $61k difference in price! Somebody was motivated, and yes the lot size was the same.
Active - One 3417 sq ft home has been listed now for 80 days at 1,049,000. This story will probably not have a happy ending.
Expired – One 4115 sq ft home which made it from 1.044M down to 1.017K in 85 days. Close but no cigar.
Summary: The market for many of these homes was much stronger this last January. These homes could sell but I suspect they may be priced according to seller needs rather than according to market price. The last 3900 sq ft home in this price range sold in January for 1.011M and I feel prices may have weakened a bit over the last 10 month period. There is a 4143 sq ft home currently being offered at 916K. I would wonder about anything listing for over 950K.
Conclusion: Among the more moderately priced homes there appears to be a gradual resolution of market pricing. However, it appears that as home prices go up, the willingness of owners to part with them at market price diminishes. I’m sure that the new home builders are offering large home discounts on their brand new homes in order to sell them. This can obviously have an adverse effect on those folks who bought at the top of the market two years ago as an investment. With one or two year selling restrictions just now releasing owners to sell, they probably are finding it difficult to recoup their investments. They may be competing with their own home builders. Many of these investors are going to be unwilling to take a loss and sell at a lower price if they can make their payments for a few more years until their equity builds again. That may be part of the reason for the large number of cancelled and expired listings in the more expensive homes. That is really too bad, because these are beautiful homes that deserve to be filled with appreciative families.
For more commentaries and market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
Friday, October 12, 2007
Mortgage for the Disciplined - San Francisco Chronicle Article
Kathleen Pender
Thursday, May 26, 2005
At a time when most homeowners are trying to pay off their loans as slowly as possible, CMG Financial Services of San Ramon is introducing a mortgage that's designed to help borrowers accelerate their principal payments as painlessly as possible.
That sounds like a worthwhile goal, but the loan is complicated and carries an above-average, adjustable interest rate.
Called the CMG Home Ownership Accelerator, the product marries a mortgage with a checking account.
Homeowners directly deposit their entire paycheck -- along with other checks they get each month -- into their mortgage instead of their checking account.
These deposits reduce their principal balance. Throughout the month, they can access their money by writing checks or using an ATM card, just like they would with a checking account or a home equity line of credit. These expenditures increase their loan balance.
At the end of each month, interest is assessed on the daily loan balance. The monthly interest charge is added to principal. The homeowner does not write a check to pay interest or principal.
Even so, "the loan pays off faster than a traditional mortgage because with a lower average balance, there is less interest charged and therefore more of the person's income can stay in the mortgage in the form of principal, " says Doug Nesbit, a vice president with CMG.
How much faster it pays off depends on how much a person makes, how much he spends and what happens to interest rates.
People who earn substantial incomes and save a lot will pay off the loan far more quickly than people with modest incomes that barely exceed their expenses.
People who continuously spend more than they earn will keep adding to the principal and their mortgage will end up like a negative amortization loan.
Nesbit says those kind of people should not get this new loan.
CMG says its accelerator loan "is ideally suited for homeowners with a stable salary, good credit and financial discipline."
Joyce Franklin, a financial planner with JLFranklin Wealth Planning, says "a borrower with financial discipline who wanted to pay down principal could do so on her own, without a fancy product" that charges a premium rate.
The new CMG loan carries an adjustable rate that varies monthly. It is set at 3.25 percentage points over the one-month London Interbank Offered Rate.
That margin is a full percentage point higher than the margin on a traditional adjustable-rate mortgage.
If taken out today, the rate on the CMG loan would start at 6.34 percent. If short-term interest rates continue to rise, it could shoot up quickly. The lifetime cap is 5 percentage points higher than the initial rate.
By comparison, the average rate on a 30-year fixed-rate mortgage was 5.71 percent last week and the average rate on a one-year Treasury-indexed adjustable-rate mortgage was 4.26 percent, according to Freddie Mac.
Nesbit says CGM needs to charge a higher rate because its mortgage is more "transactional" than most.
Even with the higher rate, he says, most disciplined borrowers will save money over a conventional mortgage because they will pay it off faster.
Kacy Gott, a financial planner with Kochis Fitz, says his firm often advises sophisticated investors to minimize their mortgage payments and put the money they would have devoted to principal into something with a higher expected return. "It's cheap money," he says.
The problem is, many people who minimize their mortgage payment -- by using interest-only loans, for example -- spend their forgone principal payments "shopping the sales at Nordstrom or taking a vacation," Gott says.
Those people, he says, would be better off paying down their principal. But like Franklin, he's not sure the new CMG mortgage is the best way to do it.
Gott says borrowers would need to make sure they don't jeopardize their federal tax deduction for mortgage interest with the new loan.
Nesbit says borrowers would need to keep good track of monthly expenditures to make sure they don't lose the deduction. This is a complicated issue, and CGM says borrowers should consult their tax advisers.
Although the new loan is being pitched as a way to pay down a mortgage quickly, it is technically an interest-only loan for the first 10 years, with the principal being amortized over the next 20 years.
Nesbit says "interest-only" is a bit of a misnomer because "you are making principal payments whether you know it or not" in the first 10 years.
GMAC has agreed to buy and service the loans, Nesbit says.
CMG says similar products have been available in Britain and Australia, but never before in the United States.
My sources confirm this may well be the first of its kind in the United States, but are not sure whether it will be a success.
"The last British product that tried to make it over here was the annuity mortgage," says Keith Gumbinger, a vice president with HSH Associates. That product never caught on.
"My suspicion is it's going to be too complicated for most audiences," Gumbinger says. "It's an interesting concept, but I don't think that it's got legs."
IShares split: Barclays Global Investors has declared stock splits on 12 of its 98 iShares mutual funds. IShares are exchange-traded funds that trade throughout the day on a stock exchange.
The splits -- two-for-one or three-for-one, depending on the fund -- are for shareholders of record June 6 and payable on June 8. They will begin trading on a split-adjusted basis June 9.
The funds being split are trading in the triple digits, some higher than $200 per share. The splits will bring them back into the $50 range. They include some of the best-performing iShares, hence their stratospheric prices.
They include two international funds (MSCI Emerging Markets Index and MSCI-EAFE Index), two real estate funds (Cohen & Steers Realty Majors Index and Dow Jones U.S. Real Estate Index) and the Goldman Sachs Natural Resources Index fund. The others are domestic small- and mid-cap funds.
Barclays is making the splits because customers, mainly financial advisers, requested it.
"By giving the funds a smaller price, you can be more accurate on your asset allocation," says J. Parsons, a managing director with Barclays. "If you have a $20,000 account split among five asset classes, being able to make shifts in $60 chunks instead of $180 chunks is meaningful."
Net Worth runs Tuesdays, Thursdays and Sundays. E-mail Kathleen Pender at kpender@sfchronicle.com.
PS Yield Financial Corp in Camarillo, CA now offers this mortgage program. It is hard to understand all it's benefits and believe that they are real. It's real. I have it myself and recommend it to anyone who can qualify.
For more commentaries and local market surveys you are invited to visit my website at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
Thursday, May 26, 2005
At a time when most homeowners are trying to pay off their loans as slowly as possible, CMG Financial Services of San Ramon is introducing a mortgage that's designed to help borrowers accelerate their principal payments as painlessly as possible.
That sounds like a worthwhile goal, but the loan is complicated and carries an above-average, adjustable interest rate.
Called the CMG Home Ownership Accelerator, the product marries a mortgage with a checking account.
Homeowners directly deposit their entire paycheck -- along with other checks they get each month -- into their mortgage instead of their checking account.
These deposits reduce their principal balance. Throughout the month, they can access their money by writing checks or using an ATM card, just like they would with a checking account or a home equity line of credit. These expenditures increase their loan balance.
At the end of each month, interest is assessed on the daily loan balance. The monthly interest charge is added to principal. The homeowner does not write a check to pay interest or principal.
Even so, "the loan pays off faster than a traditional mortgage because with a lower average balance, there is less interest charged and therefore more of the person's income can stay in the mortgage in the form of principal, " says Doug Nesbit, a vice president with CMG.
How much faster it pays off depends on how much a person makes, how much he spends and what happens to interest rates.
People who earn substantial incomes and save a lot will pay off the loan far more quickly than people with modest incomes that barely exceed their expenses.
People who continuously spend more than they earn will keep adding to the principal and their mortgage will end up like a negative amortization loan.
Nesbit says those kind of people should not get this new loan.
CMG says its accelerator loan "is ideally suited for homeowners with a stable salary, good credit and financial discipline."
Joyce Franklin, a financial planner with JLFranklin Wealth Planning, says "a borrower with financial discipline who wanted to pay down principal could do so on her own, without a fancy product" that charges a premium rate.
The new CMG loan carries an adjustable rate that varies monthly. It is set at 3.25 percentage points over the one-month London Interbank Offered Rate.
That margin is a full percentage point higher than the margin on a traditional adjustable-rate mortgage.
If taken out today, the rate on the CMG loan would start at 6.34 percent. If short-term interest rates continue to rise, it could shoot up quickly. The lifetime cap is 5 percentage points higher than the initial rate.
By comparison, the average rate on a 30-year fixed-rate mortgage was 5.71 percent last week and the average rate on a one-year Treasury-indexed adjustable-rate mortgage was 4.26 percent, according to Freddie Mac.
Nesbit says CGM needs to charge a higher rate because its mortgage is more "transactional" than most.
Even with the higher rate, he says, most disciplined borrowers will save money over a conventional mortgage because they will pay it off faster.
Kacy Gott, a financial planner with Kochis Fitz, says his firm often advises sophisticated investors to minimize their mortgage payments and put the money they would have devoted to principal into something with a higher expected return. "It's cheap money," he says.
The problem is, many people who minimize their mortgage payment -- by using interest-only loans, for example -- spend their forgone principal payments "shopping the sales at Nordstrom or taking a vacation," Gott says.
Those people, he says, would be better off paying down their principal. But like Franklin, he's not sure the new CMG mortgage is the best way to do it.
Gott says borrowers would need to make sure they don't jeopardize their federal tax deduction for mortgage interest with the new loan.
Nesbit says borrowers would need to keep good track of monthly expenditures to make sure they don't lose the deduction. This is a complicated issue, and CGM says borrowers should consult their tax advisers.
Although the new loan is being pitched as a way to pay down a mortgage quickly, it is technically an interest-only loan for the first 10 years, with the principal being amortized over the next 20 years.
Nesbit says "interest-only" is a bit of a misnomer because "you are making principal payments whether you know it or not" in the first 10 years.
GMAC has agreed to buy and service the loans, Nesbit says.
CMG says similar products have been available in Britain and Australia, but never before in the United States.
My sources confirm this may well be the first of its kind in the United States, but are not sure whether it will be a success.
"The last British product that tried to make it over here was the annuity mortgage," says Keith Gumbinger, a vice president with HSH Associates. That product never caught on.
"My suspicion is it's going to be too complicated for most audiences," Gumbinger says. "It's an interesting concept, but I don't think that it's got legs."
IShares split: Barclays Global Investors has declared stock splits on 12 of its 98 iShares mutual funds. IShares are exchange-traded funds that trade throughout the day on a stock exchange.
The splits -- two-for-one or three-for-one, depending on the fund -- are for shareholders of record June 6 and payable on June 8. They will begin trading on a split-adjusted basis June 9.
The funds being split are trading in the triple digits, some higher than $200 per share. The splits will bring them back into the $50 range. They include some of the best-performing iShares, hence their stratospheric prices.
They include two international funds (MSCI Emerging Markets Index and MSCI-EAFE Index), two real estate funds (Cohen & Steers Realty Majors Index and Dow Jones U.S. Real Estate Index) and the Goldman Sachs Natural Resources Index fund. The others are domestic small- and mid-cap funds.
Barclays is making the splits because customers, mainly financial advisers, requested it.
"By giving the funds a smaller price, you can be more accurate on your asset allocation," says J. Parsons, a managing director with Barclays. "If you have a $20,000 account split among five asset classes, being able to make shifts in $60 chunks instead of $180 chunks is meaningful."
Net Worth runs Tuesdays, Thursdays and Sundays. E-mail Kathleen Pender at kpender@sfchronicle.com.
PS Yield Financial Corp in Camarillo, CA now offers this mortgage program. It is hard to understand all it's benefits and believe that they are real. It's real. I have it myself and recommend it to anyone who can qualify.
For more commentaries and local market surveys you are invited to visit my website at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
What Real Estate Consultants can say about Megan's Law
Realtor Question to CAR
I want to share with others the information I found on the Attorney General's Megan's Law Website. Does the law prohibit me in any way from sharing this information?
A person may use the information disclosed on the Attorney General's Web site only to protect a person at risk. It is a crime to use the information disclosed on the Attorney General's Internet Web site to commit a misdemeanor or felony.
Unless the information is used to protect a person at risk, it is also prohibited to use any information that is disclosed pursuant to this Internet Web site for a purpose relating to health insurance, insurance, loans, credit, employment, education, scholarships, fellowships, housing, accommodations, or benefits, privileges, or services provided by any business.
Misuse of the information may make the user liable for money damages or an injunction against the misuse. As a Real Estate Consultant and before using the information disclosed on this Web site, you may want to consult with an attorney or merely suggest to others that they view the Web site for themselves.
For more commentaries and local market surveys, you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
I want to share with others the information I found on the Attorney General's Megan's Law Website. Does the law prohibit me in any way from sharing this information?
A person may use the information disclosed on the Attorney General's Web site only to protect a person at risk. It is a crime to use the information disclosed on the Attorney General's Internet Web site to commit a misdemeanor or felony.
Unless the information is used to protect a person at risk, it is also prohibited to use any information that is disclosed pursuant to this Internet Web site for a purpose relating to health insurance, insurance, loans, credit, employment, education, scholarships, fellowships, housing, accommodations, or benefits, privileges, or services provided by any business.
Misuse of the information may make the user liable for money damages or an injunction against the misuse. As a Real Estate Consultant and before using the information disclosed on this Web site, you may want to consult with an attorney or merely suggest to others that they view the Web site for themselves.
For more commentaries and local market surveys, you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
Current Condo Price Trends in East Ventura County
Hope this doesn’t look too involved, but it really is pretty interesting when you see where the numbers are heading.
First of all, there are 200 homes selected for this report from Westlake, Agoura, Newbury Park, Thousand Oaks and Camarillo. These are all 2 bedroom or larger with 2 bathrooms or more. The homes included are selling now, or have sold for between 400K and 500K. I can do this for any price range, but have picked the most common condo price range. I have excluded all senior communities from these listings. The list looks back over the last six months of our market.
From what I have been able to see, there have been very few price reductions on the active listings. We normally will see a five to ten thousand dollar difference between list price and sales price, but we can still compare the trends.
The homes currently listed (Active Category) are averaging about $466K for original price and curently listed for 459K after an average of 7 ½ weeks on the market. Owners have reduced their asking price an average of $7,000 after an average 53 days on the market (DOM).
Over the last six months, homes went into the Contingent – Backup Category after an additional 6 days on the market. These homes sold for an average of $5,000 less than their original price. From $470k to 465K.
Over the last six months, homes went into the Pending Category after an average 71 days or 10 weeks on the market. They listed at about 457K and went into escrow for about 452K on average.
The final category – Sold – is by far the largest category with 104 homes. Homes sold for an average of 455K after an average of 14 weeks on the market.
In October ’06 – 12 homes sold for an average of 468K; January ’07 - 20 homes sold for an average of 459K; and in April ’07 - 20 homes sold for an average of 456K. We are selling more homes now than six months ago, but their prices have dropped a bit – about 12K for this home category. I’m sure a good accountant or statistician would find plenty to criticise in this rough report, but I think the trend is clear. The market is weak in this market area. Prices have fallen.
When will they bottom out is anyone’s guess but it is also clear that there is a good sized inventory to pick the special bargains from. Interest rates have trended down in recent months as well. You can verify that for yourself in a number of places. How long the low interest rates will continue is also anyone’s guess.
It is more difficult to get easy terms and no money down loans than six months ago. That means that if you have no equity or much of a down payment, or if your credit is not the best, the process may be a bit more difficult and expensive than a year ago to receive a home loan.
I hope this information is useful to you. There are folks that I work with, who would be glad to help you investigate some of the innovative new California Home Mortgage Programs. It might help you to do a little homework along those lines before you start actively searching for a home. Let me know when you feel it would be a good time to get this valuable information, and I’ll be happy to schedule you for a free consultation with myself and a mortgage program expert.
As a buyer, you do not pay me a commission. However, buying a home without good knowledge of the home buying process or of the mortgage programs available – could be extremely expensive over time. I would be happy to help you receive the information you need to save thousands of dollars. Please tell me when you think it would be useful to get together and review some of your family needs.
Find more commentaries and market studies you are invited to visit my website blog http://www.markthorngren.com/
Warmest Regards,
Mark Thorngren
First of all, there are 200 homes selected for this report from Westlake, Agoura, Newbury Park, Thousand Oaks and Camarillo. These are all 2 bedroom or larger with 2 bathrooms or more. The homes included are selling now, or have sold for between 400K and 500K. I can do this for any price range, but have picked the most common condo price range. I have excluded all senior communities from these listings. The list looks back over the last six months of our market.
From what I have been able to see, there have been very few price reductions on the active listings. We normally will see a five to ten thousand dollar difference between list price and sales price, but we can still compare the trends.
The homes currently listed (Active Category) are averaging about $466K for original price and curently listed for 459K after an average of 7 ½ weeks on the market. Owners have reduced their asking price an average of $7,000 after an average 53 days on the market (DOM).
Over the last six months, homes went into the Contingent – Backup Category after an additional 6 days on the market. These homes sold for an average of $5,000 less than their original price. From $470k to 465K.
Over the last six months, homes went into the Pending Category after an average 71 days or 10 weeks on the market. They listed at about 457K and went into escrow for about 452K on average.
The final category – Sold – is by far the largest category with 104 homes. Homes sold for an average of 455K after an average of 14 weeks on the market.
In October ’06 – 12 homes sold for an average of 468K; January ’07 - 20 homes sold for an average of 459K; and in April ’07 - 20 homes sold for an average of 456K. We are selling more homes now than six months ago, but their prices have dropped a bit – about 12K for this home category. I’m sure a good accountant or statistician would find plenty to criticise in this rough report, but I think the trend is clear. The market is weak in this market area. Prices have fallen.
When will they bottom out is anyone’s guess but it is also clear that there is a good sized inventory to pick the special bargains from. Interest rates have trended down in recent months as well. You can verify that for yourself in a number of places. How long the low interest rates will continue is also anyone’s guess.
It is more difficult to get easy terms and no money down loans than six months ago. That means that if you have no equity or much of a down payment, or if your credit is not the best, the process may be a bit more difficult and expensive than a year ago to receive a home loan.
I hope this information is useful to you. There are folks that I work with, who would be glad to help you investigate some of the innovative new California Home Mortgage Programs. It might help you to do a little homework along those lines before you start actively searching for a home. Let me know when you feel it would be a good time to get this valuable information, and I’ll be happy to schedule you for a free consultation with myself and a mortgage program expert.
As a buyer, you do not pay me a commission. However, buying a home without good knowledge of the home buying process or of the mortgage programs available – could be extremely expensive over time. I would be happy to help you receive the information you need to save thousands of dollars. Please tell me when you think it would be useful to get together and review some of your family needs.
Find more commentaries and market studies you are invited to visit my website blog http://www.markthorngren.com/
Warmest Regards,
Mark Thorngren
New Home Developments in West Ventura County
I have done a little research on new home developments in Ventura County today for those of you who may be interested. All of these new developments are within 10 or 20 miles of the ocean. I have not included new developments in Moorpark, Simi Valley or Fillmore. Those developments are in a bit warmer climes further from the ocean. These developments are normally made up of neighborhoods with differing home types and styles. Most have HOA’s, a few have Mello Roos. There is a county tax of 1.25% of the sale price of each home in Ventura County. Some developments are large enough to have schools and even firehouses of their own. It is important for home buyers to understand, if a tract in a new home development sells out, they will eventually become available again when the original owner sells. Often the original seller is an investor trying to “flip” a property for a quick profit. That is difficult to do in today’s slower market, which means the investor is often stuck with a second mortgage for longer than he planned. That is good for buyers who can take advantage of the seller’s situation. These sales are normally handled through the local realtors and real estate consultants. Bottom line- there really isn’t such a thing as a sold out tract if you are patient.
Camarillo – Village in the Park
One of the largest new home developments is Village in the Park. This is an upscale planned community with 9 separate tracts and home styles, which sits just South of the 101 and square in the proposed FEMA flood plain between Camarillo and the ocean. This is a community which has it’s own school, YMCA, a Central Recreation Center, East Cove Recreation Area and a West Garden Recreation Area. As of this moment only Brookshire (485K to 510K) and Kensington Court (starts in low 900K’s ) are still “available”. HOA’s are based on square footage and run from $250 to $300 a month in Brookshire. The HOA’s at Village in the Park include water, sewer, trash, hazard insurance and maintenance of the common areas. That makes it a reasonable value for our area. There are incentives gallore and these include home upgrades, and a 10K closing cost give back for using their lender. Excellent maps, floorplans and general information can be found on their website. Http://www.villageatthepark.com/index.html.
The tract names are:
· Kensington Court
· Camden
· Brookshire
· Cedar Creek
· Hampton Roads
· Wickford
· Easton Crossing
· Addison Lane
· Madison
Oxnard – Riverpark – 1,800 homes along the Santa Clara River
The largest new home development currently being built in Oxnard is Riverpark There are 15 different home plans by my count, located just North off the 101, along the banks of the Santa Clara River. HOA’s vary by neighborhood, by square footage and by builder. Standard Pacific Homes is currently marketing the Celadon tract. Their HOAs can run from less than $100.00 up to nearly $300.00. There is also a 30 year Mello Roos which is about 1.1% but it is combined with a city special tax assessment. Agents in the development have told me to just multiply the Sale Price x 1.9 to get a rough idea of the combined total. Add the HOA and you will come close to your monthly fees. The HOA in the homes built by Standard Pacific Homes includes outside maintenance, landscaping and lender insurance – typically fire. Add these to your mortgage payment for your monthly housing costs. This does not include all utilities or your personal property insurance. Even with all the added costs, the homes tend to be very competitively priced with more floor space than I would expect. In one case that I know of, a home was offered for 70K below market with a special 6% give back at close of escrow. It was the last home in the tract and had fallen out of escrow previously. This was a nicely upgraded home in a nice location. Good things can happen. Call them to find out what is currently available or I can check for you if you prefer.
Shea Homes is offering the Market Street Tract of luxury townhomes. Plans 1 – 4 range in price from 486K for 2,362 sq ft to 545K for 2,631 sq ft. HOAs are up to $292 for Phase 2. This covers the Riverpark master association dues ($32) with the balance for Fire and Casualty Insurance of the building and exterior maintenance of the building. There is a property tax rate of 1.15% of the sale price, plus a Mello Roos Tax Assessment of $4,587 per year.
Several other tracts are still under construction. They have a new school opening there this Fall. There are very nice websitesq at http://www.riverparklife.com/ or http://www.standardpacifichomes.com/ or http://www.sheahomes.com/.
The tract names are:
· Celadon
· Destination
· Luminaria
· Market Street
· Promenade
· The Avenue
· Tradewinds
· Trellis
· Westerly
· Collage
· Meridian
· Morning View
· Veranda
· Waypoint
· Daybreak
Oxnard Seaside - Westport at Mandalay Bay, Seabridge at Mandalay, Harbor Island
Take a bunch of earth movers and dig a residential marina just North of, and eventually joined with, the previous Oxnard Harbor. Viola! You have Westport at Mandalay Bay, Seabridge at Mandalay, and Harbor Island. If you have a nice sailboat, motor cruiser or yacht – now you can live next to it. This is about as good as it gets for new tract homes. Many priced below 1M. The great location is reflected in the home prices.
Westport at Mandalay Bay - Very tony area, all newer homes – salted with a Vons and some smaller shops and restaurants. Some ocean view properties. Many of these homes are sold out, but again, homes can be had through local realtors as they become available the second time around. http://johnlainghomes.com/whitesails.
The tract names are:
· Lighthouse
· Villas
· Sea Cove
· Sea View
· Sea Side
· Whitesails
Seabridge at Mandalay - Extends just East of Westport at Mandalay Bay and includes 2 man-made islands. A bit more reasonably priced (or rather less prohibitively priced) Seabridge at Mandalay includes 6 individual tracts. Much of this development is still under construction. High rise condos are part of this offering and a Marina Village that contains 3 of the tracts guarding the central bridge.to Coral Island, and flanking the Southern Bridge to Shell Island. This will be a very impressive area when complete with tiny parks and plenty of public sidewalks around the marina. All inner marina properties, but the high rises should have a great view of the beach.
The tract names are:
· Port 121
· Port Oceano
· Port Marluna
· Port Meridian
· Port Province
· Port Haviland
Harbour Island – The island is actually a westward extension of Shell Island and pushes closer to the ocean. To be honest, I don’t know if there are any homes available there yet.
East Ventura - Chapel Lane - Just North of the Santa Clara River and a little East of Riverpark is a new and much smaller home development named Chapel Lane Lofts. Named after an historic church that was transplanted from downtown Ventura and which recently burned to the ground under mysterious circumstances, Chapel Lane Lofts should hopefully fare better. These are brand new 3 story townhomes with no Mellos Roos. The townhomes were built in “Loft A thru E” and in several phases as well. Each of the homes has a two car garage and an abundance of room. From 1,177 sq ft for 399k up to 2,026 sq ft for a bit over 500K these homes are a very good value. There are mountain views from most homes, although a mobile home park abutts the back of the property. There is talk by the listing agents of a new shopping center and coffee shop to be built a few blocks away. This is a semi- rural area, which means there is still a little crop land nearby. There is no Mello Roos. There is a 1% County Sales Tax instead of the normal 1.25%. All of the units have a $250 HOA which they promise will be reduced to $200 when all units have been built and occupied. The HOA includes water, trash, landscaping. There is a $6,000 dollar give back for closing expenses or to pay down interest rates on loans or for home upgrades. If a buyer uses their lender they receive an additional $2,000. There is no website for this development, but I can email or fax you information.
Again, these are just a few of the new home developments recently completed or nearing completion in the coastal parts of Ventura County. They are fairly representative of what can be found in new homes. All of the prices and fees I’ve quoted you come from the sales counselors at the developments. All of their literature bears the remark that “all information, prices and floor plans are subject to change without notice.”
All of these developments have experienced some slow sales in the last year but seem to be doing quite well now. As a result of the slower market, the developments I’ve named do cooperate with brokers throughout the area. This can be a significant advantage for new home buyers. Instead of the old “take it or leave it” experience prevalent a few years back, sellers are working much harder to entice buyers. Buyers who shop more ( ie – look at more than one development ) will often find a better match for their needs. Brokers from outside the developments often have a more comprehensive idea of what is available in the county since they are not constrained to any one home development. Outside lenders also love to compete with the developers own lenders and often are successful in lowering the mortgage of a potential buyer.
To be fair, my experience with the sales counselors in these developments has been quite positive. They know their own homes very well and have many incentives to entice buyers to buy their homes. My advantage is I know a little bit about most of the developments, enough to get you to the best developments for your needs, without any restrictions to what I can show you. I can also help you compare a wide range of mortgage programs without fear of loosing my job.
For more commentaries and local market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
Camarillo – Village in the Park
One of the largest new home developments is Village in the Park. This is an upscale planned community with 9 separate tracts and home styles, which sits just South of the 101 and square in the proposed FEMA flood plain between Camarillo and the ocean. This is a community which has it’s own school, YMCA, a Central Recreation Center, East Cove Recreation Area and a West Garden Recreation Area. As of this moment only Brookshire (485K to 510K) and Kensington Court (starts in low 900K’s ) are still “available”. HOA’s are based on square footage and run from $250 to $300 a month in Brookshire. The HOA’s at Village in the Park include water, sewer, trash, hazard insurance and maintenance of the common areas. That makes it a reasonable value for our area. There are incentives gallore and these include home upgrades, and a 10K closing cost give back for using their lender. Excellent maps, floorplans and general information can be found on their website. Http://www.villageatthepark.com/index.html.
The tract names are:
· Kensington Court
· Camden
· Brookshire
· Cedar Creek
· Hampton Roads
· Wickford
· Easton Crossing
· Addison Lane
· Madison
Oxnard – Riverpark – 1,800 homes along the Santa Clara River
The largest new home development currently being built in Oxnard is Riverpark There are 15 different home plans by my count, located just North off the 101, along the banks of the Santa Clara River. HOA’s vary by neighborhood, by square footage and by builder. Standard Pacific Homes is currently marketing the Celadon tract. Their HOAs can run from less than $100.00 up to nearly $300.00. There is also a 30 year Mello Roos which is about 1.1% but it is combined with a city special tax assessment. Agents in the development have told me to just multiply the Sale Price x 1.9 to get a rough idea of the combined total. Add the HOA and you will come close to your monthly fees. The HOA in the homes built by Standard Pacific Homes includes outside maintenance, landscaping and lender insurance – typically fire. Add these to your mortgage payment for your monthly housing costs. This does not include all utilities or your personal property insurance. Even with all the added costs, the homes tend to be very competitively priced with more floor space than I would expect. In one case that I know of, a home was offered for 70K below market with a special 6% give back at close of escrow. It was the last home in the tract and had fallen out of escrow previously. This was a nicely upgraded home in a nice location. Good things can happen. Call them to find out what is currently available or I can check for you if you prefer.
Shea Homes is offering the Market Street Tract of luxury townhomes. Plans 1 – 4 range in price from 486K for 2,362 sq ft to 545K for 2,631 sq ft. HOAs are up to $292 for Phase 2. This covers the Riverpark master association dues ($32) with the balance for Fire and Casualty Insurance of the building and exterior maintenance of the building. There is a property tax rate of 1.15% of the sale price, plus a Mello Roos Tax Assessment of $4,587 per year.
Several other tracts are still under construction. They have a new school opening there this Fall. There are very nice websitesq at http://www.riverparklife.com/ or http://www.standardpacifichomes.com/ or http://www.sheahomes.com/.
The tract names are:
· Celadon
· Destination
· Luminaria
· Market Street
· Promenade
· The Avenue
· Tradewinds
· Trellis
· Westerly
· Collage
· Meridian
· Morning View
· Veranda
· Waypoint
· Daybreak
Oxnard Seaside - Westport at Mandalay Bay, Seabridge at Mandalay, Harbor Island
Take a bunch of earth movers and dig a residential marina just North of, and eventually joined with, the previous Oxnard Harbor. Viola! You have Westport at Mandalay Bay, Seabridge at Mandalay, and Harbor Island. If you have a nice sailboat, motor cruiser or yacht – now you can live next to it. This is about as good as it gets for new tract homes. Many priced below 1M. The great location is reflected in the home prices.
Westport at Mandalay Bay - Very tony area, all newer homes – salted with a Vons and some smaller shops and restaurants. Some ocean view properties. Many of these homes are sold out, but again, homes can be had through local realtors as they become available the second time around. http://johnlainghomes.com/whitesails.
The tract names are:
· Lighthouse
· Villas
· Sea Cove
· Sea View
· Sea Side
· Whitesails
Seabridge at Mandalay - Extends just East of Westport at Mandalay Bay and includes 2 man-made islands. A bit more reasonably priced (or rather less prohibitively priced) Seabridge at Mandalay includes 6 individual tracts. Much of this development is still under construction. High rise condos are part of this offering and a Marina Village that contains 3 of the tracts guarding the central bridge.to Coral Island, and flanking the Southern Bridge to Shell Island. This will be a very impressive area when complete with tiny parks and plenty of public sidewalks around the marina. All inner marina properties, but the high rises should have a great view of the beach.
The tract names are:
· Port 121
· Port Oceano
· Port Marluna
· Port Meridian
· Port Province
· Port Haviland
Harbour Island – The island is actually a westward extension of Shell Island and pushes closer to the ocean. To be honest, I don’t know if there are any homes available there yet.
East Ventura - Chapel Lane - Just North of the Santa Clara River and a little East of Riverpark is a new and much smaller home development named Chapel Lane Lofts. Named after an historic church that was transplanted from downtown Ventura and which recently burned to the ground under mysterious circumstances, Chapel Lane Lofts should hopefully fare better. These are brand new 3 story townhomes with no Mellos Roos. The townhomes were built in “Loft A thru E” and in several phases as well. Each of the homes has a two car garage and an abundance of room. From 1,177 sq ft for 399k up to 2,026 sq ft for a bit over 500K these homes are a very good value. There are mountain views from most homes, although a mobile home park abutts the back of the property. There is talk by the listing agents of a new shopping center and coffee shop to be built a few blocks away. This is a semi- rural area, which means there is still a little crop land nearby. There is no Mello Roos. There is a 1% County Sales Tax instead of the normal 1.25%. All of the units have a $250 HOA which they promise will be reduced to $200 when all units have been built and occupied. The HOA includes water, trash, landscaping. There is a $6,000 dollar give back for closing expenses or to pay down interest rates on loans or for home upgrades. If a buyer uses their lender they receive an additional $2,000. There is no website for this development, but I can email or fax you information.
Again, these are just a few of the new home developments recently completed or nearing completion in the coastal parts of Ventura County. They are fairly representative of what can be found in new homes. All of the prices and fees I’ve quoted you come from the sales counselors at the developments. All of their literature bears the remark that “all information, prices and floor plans are subject to change without notice.”
All of these developments have experienced some slow sales in the last year but seem to be doing quite well now. As a result of the slower market, the developments I’ve named do cooperate with brokers throughout the area. This can be a significant advantage for new home buyers. Instead of the old “take it or leave it” experience prevalent a few years back, sellers are working much harder to entice buyers. Buyers who shop more ( ie – look at more than one development ) will often find a better match for their needs. Brokers from outside the developments often have a more comprehensive idea of what is available in the county since they are not constrained to any one home development. Outside lenders also love to compete with the developers own lenders and often are successful in lowering the mortgage of a potential buyer.
To be fair, my experience with the sales counselors in these developments has been quite positive. They know their own homes very well and have many incentives to entice buyers to buy their homes. My advantage is I know a little bit about most of the developments, enough to get you to the best developments for your needs, without any restrictions to what I can show you. I can also help you compare a wide range of mortgage programs without fear of loosing my job.
For more commentaries and local market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
Consulting Based on Data vs Wants & Needs
Real Estate Consultants usually work at their hardest with a new client who has never bought a home before and with whom there is no previous relationship of trust. From my experience, most serious buyers and sellers review news data and use it to temper their decisions. Then they buy or sell regardless of the data and according to their personal wants and needs. This translates into allowing news data to help time their actions but rarely prevents them from accomplishing their goals.
Today we hear a great deal of negative information in the newspapers and on tv about our industry, about foreclosures, sub-prime loan problems ad nauseum. They represent data culled by "experts" most of whom have never sold a home in their lives. Sometimes I feel I could pick out their conclusions according to their author before I read their "data".
My challenge is often one of educating potential home buyers and sellers to the local market data and weening them away from generalized news data that often does not pertain to our local market. If I can help someone see immediate advantages, money saving opportunities and the fulfillment of their family dreams - to lead them through the fog of news misinformation, I feel I have done my job.
We are at our best when we serve our individual clients needs. We might be compared to tailors. You buy a suit or dress and we make it fit. Larger statistics are very subjective and prone to the writers point of view. I think you can sometimes tell a newspaper by the tone of its editorial. I have a science background myself and I do understand the importance of data, but when you focus on a specific market, the sharper you cut, the more you must qualify your results. Smaller markets act differently from larger markets. There is a science to statistical analysis, but many authors have a tendency to salt their large market data with smaller market characteristics. That’s like buying a suit off the rack at Target, tailoring one leg and calling it a tailored suit. It is, but it isn’t, and it looks pretty silly.
Some trends are easy to recognize and warn people about. The fall of hard money lenders and the subsequent tightening of lender standards. It’s easy to see day to day interest rate changes and catch short term trends. However, our current market is going through some very fundamental changes. Between falling home prices, tightening credit standards, the utter failure of the hard money lenders and uncertain interest rates, things are really changing from a few months ago. How long will interest rates continue upward? They just started trending upwards a few months ago, now they are easing back again. Conforming loans are having a significant impact on the cost of a home loan. Still, we have buyers waiting for homes to fall in price before they will committ to finding a new home. They simply do not understand the cost of a home is the cost of 2 things – the house itself and the mortgage for that home. They both have a price. Right now the cost of a mortgage is having a huge impact on monthly payments. Much more than the falling price of homes. I have tried to warn every one of my clients about this situation, I have even widely circulated an email article about this phenomenon, but it seems that few people recognize the danger.
As a Real Estate Consultant my job is to make people’s dreams come true. I work very hard to find the right home for each of my clients. Selling a home is a real challenge and often the marketing can be costly for realtors. I am totally committed to doing the best job I can for everyone I represent during the escrow process which follows. That is where the true value of my work is really felt. Most home buyers and sellers haven’t a clue of all the difficulties and complications that must be sorted through for an escrow to be successful. We have a list of 88 specific emergencies that can jeopardize an escrow and terminate a clients dreams for home ownership. We train hard to learn to recognize, plan for, and avoid these difficulties.
There are many excellent Realtors and Real Estate Consultants who feel the same way I do about putting our clients needs before our own. That usually translates into added marketing expense, time and effort to pave the road so my clients make their trip to home ownership or sales on a smooth comfortable roadway.
I specialize in looking for micro trends. I must know specific neighborhoods, and know how to find the data on any home and neighborhood. I will never suggest a sales price for a home seller or purchase price for a home buyer, without personally doing a Comparative Market Analysis for that specific home. If you ask me specific questions about a specific neighborhood, I can find you good data. If you ask me general questions about a town of 180,000 people, with various wildly different neighborhoods, my data will generalize. Does that make sense? I think if you would have asked me for price trend data in December of 2005, I would have shown you a very steep upwards curve that had already lasted several years. A buyer or seller would (and often did) make very critical decisions about their life savings that only a few months later proved to be very unfortunate. We have seen people as late as six months ago who still thought their home was on that same home value curve. People made very expensive decisions based on real but invalid trends. They were invalid because they were long term trends in a volatile market. Now we see all the foreclosures, all the bankruptcies and short sales.
Real Estate is as much to do with emotions, relationships and wants as it is about data. We must learn our clients personal needs and match them with the home market data. I can only find the right home if I take the time to get to know my clients. During consultations, we must go in depth to find motivations for buying a home. It is not unusual for a husband and wife to look at each other and remark that they were surprised at the answers the other gave.
If my clients are clear on their needs and expectations, I will be most likely successful in helping them. I will make sure the suit fits perfectly.That is when data for that specific home or neighborhood or loan program can become extremely relevant. On the other hand, a home must “feel right”. It can match the search criteria exactly, but if it does not “feel right” to my clients, they usually will not buy it. That is where knowing my clients “wants” is going to save us both a lot of time & effort. This is often very personal information and requires a great deal of mutual trust.
I want your business in the future. I will only have your business if your experience with me is beyond your expectations. I must protect your best interests by attending to over 100 pages of contractual details, negotiate and minimize your expenses, diligently consult with you to eliminate your frustrations and produce extraordinary results. If you are not outrageously happy with the level of my service to you, I will never see you again. Period. That is why I must temper data with your wants and needs. When you bring me your life savings and ask for my help, I intend to give you my very best.
For more commentaries and market surveys, you are invited to visit my website blog at http://www.markthorngren.com
Warmest Regards,
Mark Thorngren
Today we hear a great deal of negative information in the newspapers and on tv about our industry, about foreclosures, sub-prime loan problems ad nauseum. They represent data culled by "experts" most of whom have never sold a home in their lives. Sometimes I feel I could pick out their conclusions according to their author before I read their "data".
My challenge is often one of educating potential home buyers and sellers to the local market data and weening them away from generalized news data that often does not pertain to our local market. If I can help someone see immediate advantages, money saving opportunities and the fulfillment of their family dreams - to lead them through the fog of news misinformation, I feel I have done my job.
We are at our best when we serve our individual clients needs. We might be compared to tailors. You buy a suit or dress and we make it fit. Larger statistics are very subjective and prone to the writers point of view. I think you can sometimes tell a newspaper by the tone of its editorial. I have a science background myself and I do understand the importance of data, but when you focus on a specific market, the sharper you cut, the more you must qualify your results. Smaller markets act differently from larger markets. There is a science to statistical analysis, but many authors have a tendency to salt their large market data with smaller market characteristics. That’s like buying a suit off the rack at Target, tailoring one leg and calling it a tailored suit. It is, but it isn’t, and it looks pretty silly.
Some trends are easy to recognize and warn people about. The fall of hard money lenders and the subsequent tightening of lender standards. It’s easy to see day to day interest rate changes and catch short term trends. However, our current market is going through some very fundamental changes. Between falling home prices, tightening credit standards, the utter failure of the hard money lenders and uncertain interest rates, things are really changing from a few months ago. How long will interest rates continue upward? They just started trending upwards a few months ago, now they are easing back again. Conforming loans are having a significant impact on the cost of a home loan. Still, we have buyers waiting for homes to fall in price before they will committ to finding a new home. They simply do not understand the cost of a home is the cost of 2 things – the house itself and the mortgage for that home. They both have a price. Right now the cost of a mortgage is having a huge impact on monthly payments. Much more than the falling price of homes. I have tried to warn every one of my clients about this situation, I have even widely circulated an email article about this phenomenon, but it seems that few people recognize the danger.
As a Real Estate Consultant my job is to make people’s dreams come true. I work very hard to find the right home for each of my clients. Selling a home is a real challenge and often the marketing can be costly for realtors. I am totally committed to doing the best job I can for everyone I represent during the escrow process which follows. That is where the true value of my work is really felt. Most home buyers and sellers haven’t a clue of all the difficulties and complications that must be sorted through for an escrow to be successful. We have a list of 88 specific emergencies that can jeopardize an escrow and terminate a clients dreams for home ownership. We train hard to learn to recognize, plan for, and avoid these difficulties.
There are many excellent Realtors and Real Estate Consultants who feel the same way I do about putting our clients needs before our own. That usually translates into added marketing expense, time and effort to pave the road so my clients make their trip to home ownership or sales on a smooth comfortable roadway.
I specialize in looking for micro trends. I must know specific neighborhoods, and know how to find the data on any home and neighborhood. I will never suggest a sales price for a home seller or purchase price for a home buyer, without personally doing a Comparative Market Analysis for that specific home. If you ask me specific questions about a specific neighborhood, I can find you good data. If you ask me general questions about a town of 180,000 people, with various wildly different neighborhoods, my data will generalize. Does that make sense? I think if you would have asked me for price trend data in December of 2005, I would have shown you a very steep upwards curve that had already lasted several years. A buyer or seller would (and often did) make very critical decisions about their life savings that only a few months later proved to be very unfortunate. We have seen people as late as six months ago who still thought their home was on that same home value curve. People made very expensive decisions based on real but invalid trends. They were invalid because they were long term trends in a volatile market. Now we see all the foreclosures, all the bankruptcies and short sales.
Real Estate is as much to do with emotions, relationships and wants as it is about data. We must learn our clients personal needs and match them with the home market data. I can only find the right home if I take the time to get to know my clients. During consultations, we must go in depth to find motivations for buying a home. It is not unusual for a husband and wife to look at each other and remark that they were surprised at the answers the other gave.
If my clients are clear on their needs and expectations, I will be most likely successful in helping them. I will make sure the suit fits perfectly.That is when data for that specific home or neighborhood or loan program can become extremely relevant. On the other hand, a home must “feel right”. It can match the search criteria exactly, but if it does not “feel right” to my clients, they usually will not buy it. That is where knowing my clients “wants” is going to save us both a lot of time & effort. This is often very personal information and requires a great deal of mutual trust.
I want your business in the future. I will only have your business if your experience with me is beyond your expectations. I must protect your best interests by attending to over 100 pages of contractual details, negotiate and minimize your expenses, diligently consult with you to eliminate your frustrations and produce extraordinary results. If you are not outrageously happy with the level of my service to you, I will never see you again. Period. That is why I must temper data with your wants and needs. When you bring me your life savings and ask for my help, I intend to give you my very best.
For more commentaries and market surveys, you are invited to visit my website blog at http://www.markthorngren.com
Warmest Regards,
Mark Thorngren
Mortgage Review May Save Your Home
At the risk of sounding like a commercial there is a growing problem among home owners we have spoken with. Use whomever you feel best meets your particular needs, but read this and see if it makes sense to you.
I don’t know if you know, but right now over 2 million people are in trouble and may loose their homes because they don’t know what kind of a loan they have.
If you have a friend, family member, business associate or neighbor who has obtained a mortgage within the last 5 years, they may not know what kind of loan they have. Many loans have a variable rate interest feature that typically adjusts upwards in 2 to 5 years.
More than 35% of the lenders who made those loans have gone out of business in the last year and there is nobody left to explain their loans. As rates adjust, many loan holders may find a significant increase in their monthly payments with little warning.
It is possible that some people will be able to avoid an increase in payments by refinancing. Just knowing what type of loan features you have, may make it possible to make plans to lessen the impact of an adjusting mortgage interest rate.
My Mortgage Specialists – Alicia Bacon and Dori Kenworthy from Yield Financial Corp are working with me to offer a free immediate review of these mortgage products to alert folks who might have some difficulty otherwise.
If you aren’t sure if you have a problem and want to avoid an unpleasant surprise, you are welcome to take advantage of this free opportunity. We’ll help you see what you have, and maybe we can suggest a few options to help you decide what to do.
Email or call me at Mark@movewest.com or phone (805) 504-0228.
(By the way, I am not myself a mortgage lender nor do I have any financial arrangements with the lenders I recommend. )
You can contact Alicia and Dori directly at:
Alicia@YieldFinancial.com or phone (805) 504-0225 or
Dori@YieldFinancial.com or phone (805) 504-0226.
For more commentaries and market surveys you are invited to visit my website blog at http://www.markthorngren.com .
Warmest Regards,
Mark Thorngren
I don’t know if you know, but right now over 2 million people are in trouble and may loose their homes because they don’t know what kind of a loan they have.
If you have a friend, family member, business associate or neighbor who has obtained a mortgage within the last 5 years, they may not know what kind of loan they have. Many loans have a variable rate interest feature that typically adjusts upwards in 2 to 5 years.
More than 35% of the lenders who made those loans have gone out of business in the last year and there is nobody left to explain their loans. As rates adjust, many loan holders may find a significant increase in their monthly payments with little warning.
It is possible that some people will be able to avoid an increase in payments by refinancing. Just knowing what type of loan features you have, may make it possible to make plans to lessen the impact of an adjusting mortgage interest rate.
My Mortgage Specialists – Alicia Bacon and Dori Kenworthy from Yield Financial Corp are working with me to offer a free immediate review of these mortgage products to alert folks who might have some difficulty otherwise.
If you aren’t sure if you have a problem and want to avoid an unpleasant surprise, you are welcome to take advantage of this free opportunity. We’ll help you see what you have, and maybe we can suggest a few options to help you decide what to do.
Email or call me at Mark@movewest.com or phone (805) 504-0228.
(By the way, I am not myself a mortgage lender nor do I have any financial arrangements with the lenders I recommend. )
You can contact Alicia and Dori directly at:
Alicia@YieldFinancial.com or phone (805) 504-0225 or
Dori@YieldFinancial.com or phone (805) 504-0226.
For more commentaries and market surveys you are invited to visit my website blog at http://www.markthorngren.com .
Warmest Regards,
Mark Thorngren
Tuesday, October 9, 2007
Just for Fun - Halloween House Hunter
Ring! ... Ring! ... Ring!
"Hello, Thanks for calling Movewest Realty, this is Mark. How can I help you?"
"Hello Mark. I'm new to the area, and I'm looking for a home. I saw your website and decided to give you a call. I'm what most people consider a senior citizen and I think I need your help."
"Certainly Sir, I'm a designated Senior Real Estate Specialist and I would be happy to help you."
"Well actually Mark, I'm a really, really senior citizen."
"I'm sure we all feel that way from time to time Sir, and by the way ... I'm afraid I didn't catch your name."
"Well Mark, most people just call me the Count."
"What a distinguished name. Well Count, what exactly are you looking for?"
"I have some rather special needs. I have to support a large and growing number of relatives and friends. Most of them just dropped by for a bite and never left. In fact, you might more accurately describe them as a bunch of blood sucking monsters."
"Gosh Count, that sounds like my old college fraternity."
"Well Mark, I'd be very surprised if your fraternity had the same severe initiation rites our group has."
"Lots of candles, hooded celebrants, secret chanting and screaming initiates... Count?"
"Well actually, yes Mark!"
"If you've been to one, you've been to them all Count. Fraternities are the same all over."
"I suppose there is some truth to that, but believe me Mark, ours is special. None of our members actually make it through initiation, but they all stay."
"Fascinating! Those folks must feel pretty worn out after their busy evening Count."
"Mark, they feel absolutely drained after the ceremony, but are soon actively seeking new members with the rest of us."
"Well Sir, what special needs do you have for your home search?"
"Well Mark, first we need a big place with a good security system ... a nice tall stone wall, wrought iron gates, a rural location off the beaten path. Ideally, it would be something to discourage solicitors, peddlers and angry pitchfork-toting mobs."
"Er.... right count. How about a swimming pool, tennis court or a 3 car garage?"
"Well we don't require any of those, but a stable big enough for a large black horse-drawn hearse and 6 huge ebony stallions would be a plus. A backyard with a good full moon exposure, and no digging restrictions would do nicely as well. We love to do some occasional 'planting' by moonlight."
"Very intriguing Count. What kind of things grow well at night?"
"Mark it isn't so much the growing but rather the planting which concerns us. I can truthfully say that what we plant, stays planted except for once a year on Halloween. That's when our garden really 'comes alive'."
"I would really like to find a large home. A home with a deep basement with space for torture...er...scientific research equipment, a belfry with lightning rods, and ramparts with a draw bridge would be excellent. It doesn't have to be new construction. We don't need cable TV, internet access, good cell phone reception or even electricity. Candles are what we use mostly."
"You folks sound very energy conscious Count. How about lots of big windows to take advantage of solar energy. You could buy an old church."
"Sorry Mark, but that absolutely will not work. The esthetics are just all wrong for me."
"Okay, what about an old stone farmhouse with maybe a big California wine cellar?"
"That would be much better Mark, but we won't be laying down any caskets of wine. Our caskets hold a uniquely different and older vintage. It is also very light sensitive."
"OK, but a bigger home could be very expensive Count."
"We've been pre-qualified through a number of lenders Mark. We can be very persuasive, and we always have our loans approved by the end of the day. In fact, some of our best, most juicy banking experiences have been arranged after dark."
"How extraordinary Count. May I ask how many bedrooms and bathrooms you will require?"
"None at all for me Mark, but a few guest bedrooms might be appropriate. Something large enough for canopied beds, solid wooden furniture, a few tapestries and long, dark draperies for the windows. The bedroom doors should be oak plank with iron hinges and locks. The doors probably ought to be soundproofed as well. We don't want to worry about our guests comfort. We want them to feel secure. We want them to feel like they can stay forever."
"OK Count, you said you are a senior citizen. Would you like to investigate a 1031 Exchange?"
"Actually Mark, we have done quite a bit of investing over the years. You could say that we work with the liquid assets of a large number of silent investors. We are also bringing into this transaction the proceeds from a sizeable European Estate Transaction. It was actually a huge fire sale. All the local villages attended and each of our assets was quickly liquidated."
"What a wonderful event Count!"
"Good and bad Mark. The terms of the fire sale were real killers, and of course a large number of villagers had been associated with the family business for many years. We hated to let them go. However, we do feel we'll be competitive here in America. I love a personal challenge, something I can really sink my teeth into."
"What is your business Count?"
"Well Mark, we have diversified over the years. We began in the warm beverage business, and through what might now be called hostile takeovers, we have increased our market share in some rather well known businesses. We actually coined the term 'The Big Gulp'. Our business plan is so strong now that we have expanded into many more fields. We just murder the competition. Our only real challenge now will be overcoming business restrictions mandated from State Government here in California. Fortunately, we feel confident that given a few years of working closely with our elected officials, we'll be able to convert them to our cause. After all, what we do isn't so very different from what they do."
Find out the value of homes near your castle. Visit http://www.searchcamarillohomes.com/
or to read additional commentaries and local market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
"Hello, Thanks for calling Movewest Realty, this is Mark. How can I help you?"
"Hello Mark. I'm new to the area, and I'm looking for a home. I saw your website and decided to give you a call. I'm what most people consider a senior citizen and I think I need your help."
"Certainly Sir, I'm a designated Senior Real Estate Specialist and I would be happy to help you."
"Well actually Mark, I'm a really, really senior citizen."
"I'm sure we all feel that way from time to time Sir, and by the way ... I'm afraid I didn't catch your name."
"Well Mark, most people just call me the Count."
"What a distinguished name. Well Count, what exactly are you looking for?"
"I have some rather special needs. I have to support a large and growing number of relatives and friends. Most of them just dropped by for a bite and never left. In fact, you might more accurately describe them as a bunch of blood sucking monsters."
"Gosh Count, that sounds like my old college fraternity."
"Well Mark, I'd be very surprised if your fraternity had the same severe initiation rites our group has."
"Lots of candles, hooded celebrants, secret chanting and screaming initiates... Count?"
"Well actually, yes Mark!"
"If you've been to one, you've been to them all Count. Fraternities are the same all over."
"I suppose there is some truth to that, but believe me Mark, ours is special. None of our members actually make it through initiation, but they all stay."
"Fascinating! Those folks must feel pretty worn out after their busy evening Count."
"Mark, they feel absolutely drained after the ceremony, but are soon actively seeking new members with the rest of us."
"Well Sir, what special needs do you have for your home search?"
"Well Mark, first we need a big place with a good security system ... a nice tall stone wall, wrought iron gates, a rural location off the beaten path. Ideally, it would be something to discourage solicitors, peddlers and angry pitchfork-toting mobs."
"Er.... right count. How about a swimming pool, tennis court or a 3 car garage?"
"Well we don't require any of those, but a stable big enough for a large black horse-drawn hearse and 6 huge ebony stallions would be a plus. A backyard with a good full moon exposure, and no digging restrictions would do nicely as well. We love to do some occasional 'planting' by moonlight."
"Very intriguing Count. What kind of things grow well at night?"
"Mark it isn't so much the growing but rather the planting which concerns us. I can truthfully say that what we plant, stays planted except for once a year on Halloween. That's when our garden really 'comes alive'."
"I would really like to find a large home. A home with a deep basement with space for torture...er...scientific research equipment, a belfry with lightning rods, and ramparts with a draw bridge would be excellent. It doesn't have to be new construction. We don't need cable TV, internet access, good cell phone reception or even electricity. Candles are what we use mostly."
"You folks sound very energy conscious Count. How about lots of big windows to take advantage of solar energy. You could buy an old church."
"Sorry Mark, but that absolutely will not work. The esthetics are just all wrong for me."
"Okay, what about an old stone farmhouse with maybe a big California wine cellar?"
"That would be much better Mark, but we won't be laying down any caskets of wine. Our caskets hold a uniquely different and older vintage. It is also very light sensitive."
"OK, but a bigger home could be very expensive Count."
"We've been pre-qualified through a number of lenders Mark. We can be very persuasive, and we always have our loans approved by the end of the day. In fact, some of our best, most juicy banking experiences have been arranged after dark."
"How extraordinary Count. May I ask how many bedrooms and bathrooms you will require?"
"None at all for me Mark, but a few guest bedrooms might be appropriate. Something large enough for canopied beds, solid wooden furniture, a few tapestries and long, dark draperies for the windows. The bedroom doors should be oak plank with iron hinges and locks. The doors probably ought to be soundproofed as well. We don't want to worry about our guests comfort. We want them to feel secure. We want them to feel like they can stay forever."
"OK Count, you said you are a senior citizen. Would you like to investigate a 1031 Exchange?"
"Actually Mark, we have done quite a bit of investing over the years. You could say that we work with the liquid assets of a large number of silent investors. We are also bringing into this transaction the proceeds from a sizeable European Estate Transaction. It was actually a huge fire sale. All the local villages attended and each of our assets was quickly liquidated."
"What a wonderful event Count!"
"Good and bad Mark. The terms of the fire sale were real killers, and of course a large number of villagers had been associated with the family business for many years. We hated to let them go. However, we do feel we'll be competitive here in America. I love a personal challenge, something I can really sink my teeth into."
"What is your business Count?"
"Well Mark, we have diversified over the years. We began in the warm beverage business, and through what might now be called hostile takeovers, we have increased our market share in some rather well known businesses. We actually coined the term 'The Big Gulp'. Our business plan is so strong now that we have expanded into many more fields. We just murder the competition. Our only real challenge now will be overcoming business restrictions mandated from State Government here in California. Fortunately, we feel confident that given a few years of working closely with our elected officials, we'll be able to convert them to our cause. After all, what we do isn't so very different from what they do."
Find out the value of homes near your castle. Visit http://www.searchcamarillohomes.com/
or to read additional commentaries and local market surveys you are invited to visit my website blog at http://www.markthorngren.com.
Warmest Regards,
Mark Thorngren
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