Home Front

 It's being called the biggest housing bill in decades - and it's on its way to President Bush after U.S. Senate passage this afternoon.

What's in it? The Associated Press has a definitive guide.

The New York Times has this story about the Senate action.

Being in Sacramento, it feels like a lot of floodwater has gone under the bridge before Congress has finally gotten around to shoring up the levees. But it's done now.
 Let's hope this helps so we don't have 21,000 more foreclosures like the past 18 months in Amador, El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties.

Then again, I just found this AP analysis on the Huffington Post that  says  it won't  address the deep-rooted nature of the housing crisis.

And fiinally, since this is the hometown of down payment assistance giant Nehemiah Corp. of America, here's what happened in the bill: It bans down payment assistance on Oct. 1.

I had this blinding flash the other day.  I was thinking about this region's foreclosure crisis and the sales bursts we've been seeing the past few months. The blinding flash was that somewhere there is a great story about  a street or cul de sac once blasted out by foreclosures that has been stabilized by new occupants.
 
 It may well be that  it's too early for this. But whether now - or eventually - some tortured street wrecked by subprime loans or other ARMs  is going to have a bunch of new owners buying with 30-year fixed rate loans.

That a return of stability - or in the case of new neighborhoods, maybe the first stability at all. That's the kind of story I am looking for. So please keep your eyes peeled for me. It would be nice to tell that kind of tale somewhere in this region.

This video on the mortgage and foreclosure crisis just arrived from the California Reinvestment Coalition, a San Francisco-based umbrella group for consumer organizations. The point, I am told, is to put pressure on state and federal lawmakers to do more to help people save their homes. You can decide if it succeeds in that or not. It's nine minutes. FYI: There aren't any Sacramento stories here. It's mostly Bay Area and LA interviews.

This blog is mostly about residential real estate, but we've gotten a couple extensive reports the last two days from the brokerage firm Colliers International about trends in the region's industrial  and office real estate markets. Good hometown stuff here.

It all ties back to housing in some ways as this introduction to the office market states:

"The real story of 2008 has been the reaction of the marketplace to an uncertain economy in which the existing housing and mortgage lending crises have now been joined by the specter of inflation driven by soaring energy and food costs."

 San Diego and Sacramento counties had the distinct honors in the summer of 2006 to be the first in California to see sales prices dip below the same time a year earlier.
  Now here's a wild story out of San Diego, where City Attorney Michael Aguirre is suing Bank of America to stop its new acquisition, Countrywide, from foreclosing on any more homes in the city. He's expanding the lawsuit to other lenders, as well.
Image: Hillquest.com

 Deadlines and commitments...now back to posting as the housing avalanche continues with one development after another.

 First, the story this morning by my colleague Mark Glover about Washington State revoking the business license of Roseville's Paramount Equity Mortgage, Inc. Mark jumped in because I had another story in motion about homeowner associations feeling the weight of foreclosures and rising energy prices. It's set to run Sunday.

The e-mail IN box just lit up yesterday when this news broke in Washington State. Thanks to all who passed it along. Here is the official news release from the Washington State Department of Financial Institutions. It has a link to the official complaint.

Paramount, by the way, denies the allegation. Its statement is in Glover's story.
Image: yellowpages.com

 It's getting harder to remember when foreclosures weren't an everyday thing in Sacramento and California. But DataQuick Information Systems released its 2nd Quarter report today.

 Here's our online version of the story. A full story will appear in print tomorrow.

Nonprofit giant Nehemiah Corp. of America says in today's Sacramento Bee that it expects Congress to ban down payment assistance "gifts" this week and shut down the decade-old program. The Washington Post also tells the story this morning.

 I had coffee this afternoon with Nehemiah Corp. of America President and CEO Scott Syphax, who earlier told his board and staff that the end of down-payment assistance seems iminent.

 Syphax, always well wired to Washington, D.C., says he's told the House version of the big housing bill will copy the Senate's July 11 version. That means both will write into law a ban on the decade-old down payment assistance pioneered here in Sacramento at Antioch Progressive Baptist Church. It started as a way to help church members buy houses, spread natiionally and ignited a decade-old war with the federal government, which has never liked it.

 Now it appears the feds are going to prevail. I'll have the full story on tomorrow's business page.

"Under the program, first-time homebuyers will be eligible for below-market interest rate loans to purchase foreclosed homes in ZIP codes with some of the state's highest foreclosure rates."  

Gov. Arnold Schwarzenegger announced a new program this morning through the California Housing Finance Agency to help more people qualify to buy foreclosed homes. The news release is here.

 

 Well, it turns out there's quite a bit more to the story about Doug Pautsch's departure from Centex Corp. after running its Sacramento division for more than two years.
  After running an item here a couple of weeks ago about it (Centex said it was part of a consolidation of three divisions into one), people in the know asked if I knew about the lawsuit.
  We've finally gotten a copy of it and  some comment in this story just published online.
  Centex, asked for a comment, said, as a matter of policy, it doesn't comment on litigation.

 One of the enduring images of real estate agents is the ceaseless driving around in roomy cars to show houses to clients.That's gotta hurt these days with some agents reportedly driving 20,000 miles a year doing this.
  Sure enough, here is an article in Inman News on 12 ways for agents to cut down on gasoline. 

And finally, here is a more intensely local view of June sales in most Sacramento area ZIP Codes. There's great close-to-home data in this one.

 

When the median sales price of a single-family resale home in Sacramento County slips to $214,000 - as it did in June - it's easy to think the entire market is a crashing mess.

Should we all just jump off a cliff?

 Well, true. It isn't pretty out there for sellers and homeowners. But there's some nuance in this kind of a median price that should be pointed out. It's really a reflection of the abundance of bank-owned homes. They're the ones really setting the pace now, ruling the market.

 I asked DataQuick's Andrew Lepage about this today. Here's what he said:

"Not to belittle the widespread depreciation out there. But it's clear to me that the median is down sharply as it is because so much of what is selling is distressed in areas that saw a lot of depreciation and foreclosure activity. Those areas account for a great percentage of sales."

 Photo: marketoracle.co.uk

 

 

 

 

 

 

 There are so many numbers, so little space in the print edition. Here's more that I couldn't fit in to the main story about June sales in the capital region and elsewhere:

First off, are June sales and prices from the Bay Area and from Southern California.

I always like to put the capital region in context with other parts of California  - and noticed that Solano, Riverside and San Bernardino counties are also seeing the year-over-year increases that have pushed up the Sacramento market now for three straight months.
  Primarily, this is an inland California phenomenon. It's happening where there was the most construction,  the fastest rise in prices and then the fastest fall in prices.

  As DataQuick analyst Andrew Lepage said earlier today on the phone: "Wherever prices have come down, sales have gained traction."

Four capital-area counties saw the year-over-year sales jumps of new and existing homes combined in June:

Sacramento: 45.7%
Yolo: 17.7%
Yuba: 14.4%
Sutter: 9.2%

Down Highway 99:
San Joaquin: 74.3%
Stanislaus: 57.4%
Merced: 63.1%

Bay Area:
Solano: 2.2% (It's the only one of six counties to see a rise from same time last year)

Southern California:
Riverside: 11.8%
San Bernardino: 1.1%

Central California:
Monterey: 46.8% (the Salinas factor)

THE FORECLOSURE FACTOR:
Here's what percent of June sales in some inland counties were bank repos:
Sacramento: 63.3%
San Joaquin: 65.9%
Stanislaus: 71.7%
Riverside: 62.3%

Source for all this: DataQuick Information Systems

We will have a full online story posted on sacbee.com very soon about the new June numbers from DataQuick.  In the meantime here is a quick snapshot. Bottom line, the year-over-year rises continued for a third straight month, showing a solid upward trend.
The reason is pretty simple: It's getting affordable around here for a lot more people.

The full chart can be found here.


Some highlights in the meantime:

• Sacramento County's 2,053 sales of existing homes was the highest since Oct. 2005. Sales of new and existing homes combined were the highest since June 2006. They were up 45.7 percent from the same time last year. That was the highest rate of increase yet since April revealed a 26.3 percent gain over the same time in 2007.

Falling prices tell much of the story. With repos dominating sales activity, June's median resale home price of $214,000 is the lowest since $210,000 in Feb. 2003. Median prices for new and existing homes combined slipped to $220,000 - a level last seen in Aug. 2002, DataQuick reported.

Median is that point where half cost more and half less.

• Placer County reported 610 sales of new and existing homes combined, 9.9 percent fewer than the same time last year. It was the county's fewest sales since June 1996, DataQuick reported.

Median prices of all homes declined to $335,000, same as Aug. 2003. Prices of existing homes at $341,5000 were the lowest since March 2004.

• El Dorado County, with 210 sales, was down 9.5 percent from the same time last. It's median price of $380,000 is back to levels seen in July 2004.

• Yolo County reported 293 sales, up 17.7 percent from the same time last year. It's median price, $310,250, is back to levels seen in Feb. 2004.

• Sutter County had 107 June sales, according to DataQuick, 9.2 percent more than June 2007. Its median price is $208,000, is the lowest since Jan. 2004.

• Yuba County saw a 14.4 percent gain in sales from the same month last year, with 135 sales, DataQuick reported. Repeating a pattern started in March and April, its median price of $195,000 was below $200,000 for the first time since Jan. 2004.

Attorneys for Bank of America have filed a request with the U.S. Bankruptcy Court, Eastern District, asking for a "motion for relief from the automatic stay" on a Sacramento home owned by Reynen & Bardis Communities co-founder John Reynen and his wife, Judith.

Translated: they are initiating a process aiming to get the house in exchange for $1.5 million in debts allegedly owed the Charlotte-based bank. The house was reportedly valued at $3.6 million in an earlier bankruptcy filing.

Reynen spokeswoman Michele McCormick says the BofA request is not about the larger financial problems of the company. She says Reyen has missed some payments on a home loan made by the Charlotte bank.

The filing was July 10. A hearing on the request is set for Aug. 12.

A May 30 Home Front posting here provides some background.

 California's home builders say they've realized their top legislative priority for 2008 with the signing of a bill allowing them to extend their subdivision maps. While that may sound arcane, it gives subdivisions already approved by cities an extra year before expiring.

It takes effect immediately. What it means is builders who got approvals and then saw the market slow their timeframe won't have to spend money to their projects reauthorized.

Gov. Schwarzenegger signed the bill, SB11285 carried by Sen. Alan Lowenthal, D-Long Beach, late Tuesday, the CBIA said. Similar legislation passed during the 1990s housing downturn.

                                 
 Here's an interesting news release just in from UC Davis. A student team there has designed a
 solar- and wind-powered housing proposal for residents of downtown Sacramento's Marshall Hotel. It's set to become a boutique hotel, dislodging more than 100 single-room-occupancy residents.
 
The proposal, picked up Denver-based nonprofit developer Mercy Housing, would on a half-acre of city land on I Street, across from the Sacramento County Jail.

Image: Flickr.com

Year-over-year existing home sales have been growing in the capital region for three straight months, but homebuilders are seeing their year-over-year sales still declining.

This new May report from the California Building Industry Association shows May sales in the capital region (El Dorado, Placer, Sacramento, Yolo) are down 28.5 percent from May, 2007.

New home sales in Yuba and Sutter counties are down 60 percent from May 2007.
 
Statewide, year-over-year sales are down 51 percent.

The Sacramento Association of Realtors has just released its June numbers, showing that closed escrows for existing homes are up 95 percent over June 2007.
 That's 1,883 sales last month compared to 965 the same month last year.
 
 Bank repos continue to be center stage - 67 percent of June sales.

Check out this feast of data for yourselves:

Here is the news release summarizing it all.

The main overall county report is here.

And, here are the details by ZIP Code.

Image: fasttrackbuyers.co.uk

Washington Mutual took a drubbing today in the stock market for fear that it's sitting on a lot of troubled loans. The Housing Wire summarizes WAMU's bad day here.
 
I saw all the speculation about troubled loans and looked up its market share in Sacramento. DataQuick Information Systems says WAMU was the fourth biggest lender in El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties from mid-2005 to mid-2007.

It did 22,784 puchase loans and refinancings worth $4.6 billion, according to DataQuick.That was a 5.14% market share, behind Countrywide, Wells Fargo and Bank of America.

Seeing how it's gone in Sacramento, I'd guess a lot of borrowers here are a part of WAMU's problems.

Finally, something cheerful!
 
 Rocklin is named one of the top 10 U.S. towns to raise a family in this Family Circle ranking.

It's the only town in California to make the list.

Meanwhile, its neighbor Roseville placed 90th on Money Magazine's new 100 best towns to live.  Elsewhere in California, Irvine placed fourth, Fountain Valley made 91 and Sunnyvale came in at 94.

Images: Wikipedia, city-data.com

Brad Inman, publisher of the real estate news service, Inman News, offers this perspective today on a real industry that he says has too many secrets. The public gets some blame, too.

It's a good read.

"Fundamental rules of real estate have been dismissed, such as requirements around good credit, full disclosure, transparency, a meaningful down payment, rational fees, common-sense loans and personal responsibility."

 The Placer County Association of Realtors here reports a 15 percent rise in escrow closings in June over the same month last year. This applies to existing homes.

  The new median price is $330,000 - down 21 percent from a year ago.

 

HELP FOR HOMEOWNERS

FACING MORTGAGE DEFAULT AND FORECLOSURE

SACRAMENTO, CALIF.  The Sacramento Housing and Redevelopment Agency (SHRA) in conjunction with the Sacramento Regional Partners in Homeownership and Sen. Darrell Steinberg will sponsor a free consumer workshop on mortgage default and foreclosure prevention on Wednesday, July 23, 2008, from 6:30 - 8:30 p.m., at the Sacramento Association of Realtors Auditorium, 2003 Howe Avenue, Sacramento, 95825.

Home loan and credit counselors, along with representatives from local and national banks and lending institutions will provide one-on-one advice and important information on preventing mortgage default and foreclosure.

Homeowners may bring their loan documents and financial information for review by loan counselors or lenders.  Counselors specializing in senior issues will be available to talk with elderly homeowners.

With banks going down and struggling with their bad construction and land development loans, long-time Sacramento development industry rep John Hodgson is among those seeing opportunity knocking. His new venture, RCH Group, is finding a niche advising and partnering with banks that have taken back builders' land and partially built subdivisions.

I had a cup of coffee with him recently. He said RCH is a new blend of his local Hodgson Co., which most recently guided development of Elk Grove's 1,900-acre Laguna Ridge project, and the Milwaukee-based Towne Group, also known as Zilber Ltd.
The Towne Group is the umbrella organization for Towne Investments, Homes by Towne, Towne Consulting and now, RCH.

Hodgson, managing principal at RCH, said the new entity will do it all for banks sitting on repossessed land: land entitlement, planning, consulting and home building. It can also tap Towne's deep pockets to buy it outright or get into a partnership.

Hodgson, who chairs the Sacramento district council of the Urban Land Institute, a research arm of the development industry, also sees promise in guiding builders through California's unfolding global warming rules.
"Nobody has the slightest idea what that means," he said. But he's sure of one thing about going green. It's a "megatrend."

Now this is really inside baseball, but the new venture also recently snagged a pair of big names in the capital's development scene. RCH has tapped, for one, Ardie Zahedani, well known in the region's city halls as political director and lobbyist for the North State Building Industry Association. And it's also hired Jeff Ray, a planner with the Irvine-based development giant SunCal Cos.

 Image: The Hodgson Co.

"Bank-owned properties continue to flood the market under $200,000 while tight credit is really hurting sales above $400,000."

TrendGraphix has released here the first of several June sales reports expected to arrive in coming days. The research arm of Sacramento's Lyon Real Estate shows that sales of existing homes (not new ones) continue be well up over the same time last year. That's now a three-month trend. But much of the action remains in the repo end of the market.

For-sale inventory in El Dorado, Placer, Sacramento and Yolo counties is 11,854 - lowest since early 2007. (22 percent, about one in five are bank repos). The official thinking is this: most people who can wait won't even try to sell in a market where they'll compete against cheaper bank repos. It also reflects a pickup in sales.

Lyon's Assistant Controller Sara Veliz said that repos are selling on average, after 69 days on the market. Individual sellers trying to compete tak