Real Estate Information

 Analysis show that Notices of Default, which indicate the start of he foreclosure process, increased in California by 4.8 percent; while both Notices of Trustee Sale and actual foreclosure sales dropped.  Although a traditionally slow month, with the exception of February, Notices of Default have stayed in a tight range between 40,000 and 43,000 per month- a peak which may simply reflect the inability of lenders and trustees to process additional files.

 High level findings include Notices of Default increased by 4.8 percent, to a total of 42,790 filings. Notices of Trustee Sale declined by 7 percent to 36,292 filings in August. Properties taken to sale at auction decreased by8.6 percent, to 26,309 properties, with a combined loan balance of $11 Billion. Of properties taken to sale, 96 percent went back to the lender with a combined loan value of $10.55 Billion. Third party purchases continued to increase as the discounts offered by lenders also increased.

 Traditional measures of foreclosure activity include Notices of Default, which are unchanged from the beginning of the year, and sales at auction, which are up 32 percent from January this year. Measuring the number of properties currently scheduled for foreclosure requires tracking the actual foreclosure auctions, a service only Foreclosure Radar provides in the state of California. Since January, the number of properties currently scheduled for sale has doubled to 70,000.

 Of these scheduled sales, 61 percent are being postponed at the banks discretion. Beyond delaying the sale of properties I the foreclosure process, a recent report fro the A Mortgage Bankers association also seems to indicate that lenders are delaying foreclosure altogether They reported that while 6.41 percent of all loans wee delinquent, just 2.75 percent were in foreclosure.

 Average discounts offered by lenders on the outstanding loan balance at foreclosure auction averaged 36 percent statewide; with one third of all properties taken to auction being offered at discounts of 50 percent or more. Foreclosure Radar estimates that the vast majority of loans taken to auction are 1^st Mortgages, followed by homeowner association liens at 2 percent, and 2^nd and 3^rd mortgages at less than 2 percent combined. This is a dramatic shift prom previous years, when 2^nd mortgage foreclosures were far more common, and is clearly due to lack of equity for these lenders to recover.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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The House at 154 Pearl Street. Is one of the oldest surviving homes in Laguna Beach, dating back to 1883. Tresor Properties, a partnership that bought the home, plans to restore and renovate the house and build a second unit on the 5,000 square foot lot, just one block inland from the beach.

 In 1883, the light bulb was just four years old and Cuba was still apart of Spain, in this same year a small cottage sprang up at 154 Pearl St. in Laguna Beach. The Pearl street house still stands and is one of the oldest surviving home homes in Laguna Beach.

 A group of investors paid $3.8 million to buy the two-story board-and-batten residence less than a block from Pearl beach. The ocean view home is now about 1500 square feet, featuring three bedrooms and two baths. It sits o a 5,000 square foot lot. Tresor Properties plans to upgrade the home to meet today's codes using traditional materials and to add about 500 square feet. The firm plans to build a second home on the property as well, creating a condo style two unit property.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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According to this weeks Business Journal, Orange County's 34 cities added people and revenue in the past year with fast growing Irvine overtaking Huntington beach as the third largest city.

 The list ranks cities by current population and includes yearly revenue, city workers and large employers. All together, the cities have 2.99 million residents, which is virtually all of the county's 3 million people.

 Residents in the cities were up 1%, or 30,555 people, from  a year earlier. The five biggest cities- Santa Ana, Anaheim, Irvine, Huntington Beach, and Garden Grove have 1.28 million people, more than 40% of the county's total.

 Workers and Revenues have grown too. These cities employ 15,355 people, up to 10 % from a year earlier. Their revenue grew 2.3% to $2.05 billion for 12 months through June.

 Irvine was the only city on the list to change its ranking from a year earlier moving up a spot from number 4 and displacing Huntington Beach, the county's longtime largest number 3 spot.

 Residents in Irvine grew 4.3 % to 209,806 people, the most growth of any city on the list.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

For more great Orange County market insight and industry news visit Laguna Niguel Real Estate or view the Orange County Market Trends at Orange County Real Estate.  

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Dataquick shows the latest home selling stats for the 22 buisness days ended on August 22, the median home-selling price is down to $440,000, off 31.5% vs. a year ago. It hasn't been this low since November 2003.

Steep discounting’s spurring O.C. homebuying, with purchases running 19.4% ahead of the year-ago pace as 12 ZIP codes saw sales volumes double 2007’s totals for the period. July marked the first time since September 2005 that home sales exceeded the year-ago pace.

Single-family homes are $234,000 or 32% below the peak of $734,000 hit in June 2007.Condos are $147,750 or 31% below the peak of $470,000 hit in March ‘06. Newly built homes are $389,500 or 45% below the peak of $864,000 hit in February 2005. Overall, the countywide median is $205,000 or 32% below the peak of $645,000 hit in June 2007.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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Homes are getting cheaper and sales are going up. The number of Southern California homes sold last month edged up to its highest level in more than a year as bargain hunters swept up foreclosure properties in affordable neighborhoods.

In Orange County, 2,391 homes sold in July of 2007. Just a year later, 2,799 homes were sold, that's a 17.1 percent change from the previous year. The median home price in July 2007 in Orange County was $640,000. In just a year that decreased 28 percent, hitting a low of $461,000.

Market distress indicators continue to move in different directions. Financing with adjustable-rate mortgages is near the all-time low as is financing with multiple mortgages and foreclosure activity is at an all time high. Down payment sizes and flipping rates are stable, non-owner occupied buying activity appears flat but may be emerging, MDA Dataquick reported.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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After hiring nearly 50 lawyers, Knobbe Martens Olson & Bear LLP has become the county's largest law firm.

Starting this week, the lawyers push intellectual property firm Knobbe Martens past the county's longtime largest firm, Costa Mesa-based Rutan & Tucker LLP. Knobbe now has 170 local lawyers, versus Rutan & Tucker's 152.

The shift has been a long time coming with the horse race playing out in recent years on the Business Journal's annual list of the largest law firms operating here.

Rutan and Tucker had held a 14 year lead over Knobbe on the most recent list in January. The change also reflects the current state of the law business.

Rutan is the county's oldest law firm, with a history that spans more than 100 years, and has built a solid practice around real estate and government law with corporate and litigation work as well. But Rutan isn't growing nearly as fast as Knobbe.

Knobbe, which does patent, trademark, copyright and trade secrets law, is expanding as more companies look to invest in and protect intellectual property during the slow economy. In all, Knobbe has hired 46 lawyers for a total of 248 at the firm. 30 of which will work at the Knobbe's Irvine Headquarters, others will practice at the firm's offices in Los Angeles, San Diego, Riverside, Seattle, and Washington D.C.

Rutan could add lawyers to growing practice areas such as intellectual property and corporate law, according to a spokesman. It's not yet clear if the firm will hire enough lawyers to reclaim the Number 1 spot. "Rutan remains committed to sustained growth," said Michael Hornak, managing partner for Rutan & Tucker.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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Knobbe

According to C.A.R. reports, entry-level housing affordability has doubled in 2008's second quarter compared to last year.

The California Association of Realtors released a report today stating 48 percent of Los Angeles households could afford to buy an entry-level home in California, compared to the 24 percent for the same period just a year ago.

C.A.R.'s First Time buyer Housing affordability Index measured the percentage of households that can afford to purchase an entry-level home in California. C.A.R. also reports first-time home buyer indexes for regions and select counties within the state. The Index is the most fundamental measure for housing well-being for first time home buyers.

In 2008's second quarter $62,870 was the minimum housing income needed to purchase an entry-level home in California at $329,120, based on an adjustable interest rate of 5.69 percent and assuming a 10 percent down payment. First-time buyers typically purchase a home equal to 85 percent of the prevailing median price. The monthly payment including taxes and insurance was $2,100 for the second quarter of 2008.

At $62,870, the minimum qualifying income was 38 percent lower than a year earlier when households needed $101,440 to qualify for a loan on an entry-level home. Recent decreases in home prices and mortgage rates have brought affordability into better alignment wit income levels of the typical California households, where the median household income was $59,160.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

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According to Treasurer Henry Paulson, "Fannie Mae and Freddie Mac are crucial to turning the corner on housing. Therefore, the primary mission of these enterprises now will be to proactively work to increase the availability of mortgage finance."

Unfortunately, this isn't all good news. Friday's report stated that foreclosures and delinquencies are at all-time highs; Fannie and Freddie are expected to maintain - if not ratchet up -even tighter lending standards. And the fees they have introduced for borrowers with weaker credit histories won't go away anytime soon.

Mortgage rates borrowers pay are dependent on the yields that investors demand when buying mortgage-backed securities from Fannie and Freddie. Investors' doubts about the companies' viability have sent interest rates on those securities soaring. Despite regulators' July promise that they would step in to save the mortgage companies, investors are still demanding rates of 2.25% to 2.45% above Treasuries, LaMalfa said. Historically, the spread has been 1.25%.

High borrowing costs have led, in part, to a decline in mortgage borrowing. Applications are down 27% from a year ago, according to the Mortgage Bankers Association.

Borrowers shouldn't expect the lending tightening to ease though. Defaults and delinquencies are multiplying and home prices are falling. This means Fannie and Freddie will keep a close eye on underwriting practices. Lenders are demanding credit scores above 700 these days, which is up from 620 in the past, and down payments of 20%, up from zero in some cases, experts said.

The mortgage titans have also increased their fees in hopes of shoring up their finances. Just last month, Fannie Mae announced higher surcharges for loans to weaker borrowers. For instance, applicants with credit scores between 640 and 659 who are putting down 15% to 20% will pay an additional 2.25% charge. The same borrower would pay 1.7 percentage points more because of higher fees and rates for the same loan today as he or she would have paid 18 months ago, LaMalfa said. If the market continues to worsen, standards could further tighten and fees could rise more, he said.

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Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

For more great Orange County market insight and industry news visit Laguna Niguel Real Estate or view the Orange County Market Trends at Orange County Real Estate.  

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Since the first time in five years, the unemployment rate as jumped dramatically in the last month reaching 6.1 percent. And according the Labor Department, it's likely to get even higher in the months to come, possibly throwing the economy in a tailspin as Americans choose a new president.

The jobless rate in July of this year reached 5.7 percent and rose to drastically high 6.1 percent by August, according the Labor Department. Sharp increases like this are usually a strong recession warning, and it ruined investors' hopes of a recovery this year.

Marking the eighth straight month of losses, employers cut payrolls by 84,000 in August, out of worry for their economy and business prospects. This year alone a staggering 605,000 jobs have disappeared, slightly less than the population of Alaska. The economy needs to generate more than 100,000 new jobs a month for employment to remain stable.

A toxic trio of housing, credit, and financial problems has badly shaken the economy, and the risis shows no signs of letting up. It's the public’s top worry, and many experts think the situation will get worse before it gets any better.

Your thoughts and feedback on this topic are greatly appreciated.  Please feel free to post your comments.

Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

For more great Orange County market insight and industry news visit Laguna Niguel Real Estate or view the Orange County Market Trends at Orange County Real Estate.  

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According to Dataquick, the latest home-selling stats show the median home price is now at $445,000 from the 22 business days that end Aug 20. That's $200,000, or 31% below the peak of $645,000 that hit in June 2007.

Single-family homes are now $234,000 below their peak from the $734,000 that hit in June 2007. Condos are now $140,000, or 30% below the $430,000 peak it reached in March 2006. Newly built homes are down $387,999, or 45% below peak of the $864,000 high they reached in February of 2005.

The heavy discounting is moving product. O.C. home buying runs 18% above the year-ago pace. July marked the first time since September 2005 that home sales exceeded the year-ago pace.

Your thoughts and feedback on this topic are greatly appreciated.  Please feel free to post your comments.

Keeping you informed about the Orange County real estate market, economy and life in the OC is what I'm committed to doing.    

For more great Orange County market insight and industry news visit Laguna Niguel Real Estate or view the Orange County Market Trends at Orange County Real Estate.  

Listen to Zen's Laguna Niguel Real Estate Podcast available 24/7.

SEARCH ORANGE COUNTY'S BEST HOMES at Orange County MLS Home Search