California Home Buyer Tax Credit (AB 183) - The Scoop...

I have gotten at least a dozen emails with questions from buyers over the last week about the new State of California Home Buyer Tax Credit.

So yes, you probably saw on the news that Governor Schwarzenegger signed AB 183, allocating approximately $200 million for home buyer tax credits. The bill allocates $100 million for qualified first-time home buyers of existing (resale, previously occupied) homes, and $100 million for purchasers of new construction (previously unoccupied) homes. Again, the definition of a first time buyer is one that has not owned a home in the last 3 years.

The State of California tax credit is equal to the lesser of 5 percent of the purchase price or $10,000, taken in equal installments over three consecutive years. In english - if you purchased a $165,000 home, you would be eligible for a tax credit of $8,250 ($165,000 x 5% = $8,250, which is less than $10,000). If you purchase a $265,000 home, you would be eligible for a tax credit of $10,000 ($265,000 x 5% = $13,250, however the tax credit is capped at $10,000).

The eligible taxpayer who closes escrow on a qualified principal residence between May 1, 2010 and December, 31, 2010, or who closes escrow on a qualified principal residence on and after December 31, 2010 and before August 1, 2011, pursuant to an enforceable contract executed on or before December 31, 2010, will be able to take the allowed tax credits. Of course - these time periods assume that the state allocated funds will not be depleted...AND, purchasers will be required to live in the home as their principal residence for at least two years or forfeit the credit (aka, you would have to repay it to the state). AND, you must submit an application for the tax credit...the state of California does take reservations...so don't wait for tax season. No joke!

So....hopefully that clears up most of the questions folks have. As always - please get tax advice from a qualified professional like a CPA. Shoot me an email if you need a referral to a good one.

Erin's Sacramento Short Sale Experiment, Part VI

Yes, it is for my sixth installment of Erin's Sacramento Short Sale Experiment! I am sure ya'll are just on the edge of your seats to find out just what has transpired in the world of short sales in our Sacramento metro area since the last time? I am anxious to see if 2010 continues to bring a high volume of active short sale listings, and more importantly, more closed short sales. For those of you not following along at home, or perhaps if you are reading this for the first time, my short sale experiment is tracking a few different Sacramento zip codes to see what how the short sale activity increases or decreases over time as compared with traditional resale listings (where there is a seller with equity in a "normal transaction") and to bank-owned resale transactions. My hypothesis at the start of this experiment: the number of short sales will grow over time, as will their dominance in our greater Sacramento marketplace (overall percentage of listings). I have continued to list more short sale properties, and thus far I think my hypothesis has been proven to be true. Let's see how this new data compares to the "control data" for the experiment and also to last installment...

95624 is the section of Elk Grove closest to Hwy 99. As of right this second according to MLS, there are a total of 342 active listings there. 246/342 listings are short sales. The median price in that zip code in February 2010 was $235,000 according to Trendgraphix (a decrease over last installment). The result vs. the control data? Control data was 68.6% of all active listings in 95624 were short sales, vs. 75.1% last installment, vs. 71.9% this month. INCREASE over the control data, and a decrease over last installment. Number of 2009 closed short sales - 245. YTD closed in 2010 - 56.

95610 is a section of Citrus Heights. As of right this second according to MLS, there are a total of 175 active listings there. 112/175 listings are short sales. The median price in that zip code in February 2010 was $171,000 according to Trendgraphix (a significant decrease over last installment). The result vs. the control data? Control data was 60.3% of all active listings in 95610 were short sales, vs. 68.2% last installment, vs. 64.0% this month. INCREASE over the control data, and a decrease over last installment. Number of 2009 closed short sales - 85. YTD closed in 2010 - 16.

95826 is a section of Rosemont and College Greens. As of right this second according to MLS, there are a total of 136 active listings there. 70/136 listings are short sales. The median price in that zip code in February 2009 was also $170,000 according to Trendgraphix (a decrease from last installment). The result vs. the control data? Control data was 62.2% of all active listings in 95826 were short sales, vs. 59.5% last installment, vs. 51.5% this month = BIG DECREASE over the control data. Number of 2009 closed short sales - 65. YTD closed in 2010 - 20.

95864 is a section of Sierra Oaks, Arden Park, and Arden Manor. As of right this second according to MLS, there are a total of 165 active listings there. 49/165 listings are short sales. The median price in that zip code in February 2010 was $214,000 according to Trendgraphix (a big decrease over last installment). The result vs. the control data? Control data was 17.0% of all active listings in 95864 were short sales, vs. 29.3% last installment, vs. 29.7% this month. INCREASE over the control data and last month. Number of 2009 closed short sales - 18. YTD closed in 2010 - 5.

95818 is a section of Midtown, Land Park, and Curtis Park. As of right this second according to MLS, there are a total of 77 active listings there. 13/77 listings are short sales. The median price in that zip code in February 2010 was $330,000 according to Trendgraphix (big decrease over last installment). The result vs. the control data? Control data was 16.0% of all active listings in 95818 were short sales, vs. 25.9% last installment, vs. 16.9% this month. INCREASE over the control data, and a slight increase over the last installment. Number of 2009 closed short sales - 15. YTD closed in 2010 - 4.

95819 is a section of East Sacramento. As of right this second according to MLS, there are a total of 71 active listings there. 15/71 listings are short sales. The median price in that zip code in February 2010 was $339,000 according to Trendgraphix (a increase over last installment). The result vs. the control data? Control data was 19.7% of all active listings in 95819 were short sales, vs. 21.1% last month, vs. 21.1 this month. INCREASE over the control data, but a no change over last installment. Number of 2009 closed short sales - 11. YTD closed in 2010 - 0.

So in summary - of the six Sacramento area zip codes I am tracking for my experiment, 5 of them experienced a decrease in the number of active short sale listings from last installment, while 5 experienced an increase over the control data...interesting. Unfortunately, I do not think that this incremental decrease from last installment will continue as a ongoing trend. My phone definitely keeps ringing and I continue to receive emails - I am fielding lots of inquiries from homeowners looking for more information and insight from my short sale experience...buyers too are really curious about the short sale process since they are encountering so many short sale listings in our marketplace. Also (you will be aware of this if you follow me on Twitter or Facebook), I closed many of my own short sale listings since the last installment of Erin's Sacramento Short Sale Experiment....and I have been the top listing agent in my office for two months in a row (January & February). Until next time!

Erin's Sacramento Short Sale Experiment, Part I
Erin's Sacramento Short Sale Experiment, Part II
Erin's Sacramento Short Sale Experiment, Part III
Erin's Sacramento Short Sale Experiment, Part IV
Erin's Sacramento Short Sale Experiment, Part V

Raiding the Sock Aisle - Project 680's Biking for Socks

So, if you have been following my blog for any amount of time, you are probably aware that I am the 2010 Chair of the Sacramento Association of Realtors "Young Professionals Council." Last year, I had the pleasure of meeting a local appraiser and Rancho Cordova resident, Ryan Lundquist, when he joined the YPC.

Ryan is also the man behind Project 680...a couple years back, he learned that there were 680 homeless students within the Folsom-Cordova Unified School District, and spearheaded a grass-roots effort to raise resources and awareness of this issue. Today that 680 has actually grown to 783 homeless students. It sure does not seem all that long ago that I was in high school - and it is hard for me to get my mind around not having some of life's basic necessities (like socks, underwear, deodorant, etc.) at that age. So Project 680 is doing "Biking for Socks" on May 8. It's a sock drive / community bike ride to raise awareness and gather socks for the homeless student population of FCUSD.

When I learned about this event from Ryan, I thought - well I will go buy and donate a bunch of socks...and possibly attend the community ride in May since I just got a new bicycle.

So if you follow me on Twitter or Facebook, you will already know that last Saturday I took a little excursion to Target to "Raid the Sock Aisle" for Project 680. I snapped a photo of the empty sock racks in the store and posted the following to Twitter:

http://twitpic.com/19t0uy - Just raided the sock aisle at Target for @Project680 Sock Drive #RanchoCordova #BikingForSocks

My tweet about my raid of the sock aisle captured the attention of KCRA 3 Reporter Deirdre Fitzpatrick...and today, she filmed a story that will air in a couple weeks about Project 680. Ryan and I, along with some of Rancho Cordova's finest, went and raided the sock aisle again - this time on our bikes. Project 680's challenge to everyone: go raid the sock aisle! Post your photos to Twitter with the hashtag #BikingForSocks!

Trying to sell a house in Living Trust? MAKE SURE your house is actually included in the Living Trust. No really.

If you follow me on Twitter, you will already know that I have had the great displeasure of working through a pretty random "Title" issue on one of my listing transactions...and then the same issue to occured on another one of my buyer transactions! All within the course of a week's time!

So a little background. In both instances where I am experiencing this issue, the homeowner had passed away, leaving their heirs (or if you want to get technical, the "Successor Trustees") the responsibility to deal with the estate, including selling the home. Under normal circumstances, the Successor Trustee has full authority to list the property for sale, and sign a new Grant Deed to transfer title to a new buyer.

So regarding the first instance of this title issue...I am representing a seller - aka, the Successor Trustee of his father's Living Trust. This man's father passed away in January, and the seller is in Sacramento (he lives in Puerto Rico) dealing with his father's estate. He wanted to list the house immediately. He informed me that he had full authority per the Living Trust to sell the home. When I looked in the tax records, it appeared that the name on the title of the property was an individual, rather than the name of the Living Trust itself. OK. So I asked Placer Title Company to provide me with a property profile....sure enough, the title to the property was held in the name of the deceased father. The seller was frustrated...the house was specifically named in the Living Trust as being owned by the Living Trust, so what was the issue? Well, in order for the Living Trust to actually own the house, and for the Successor Trustee to have full authority to sell the house, a new Deed naming the Trust MUST HAVE been recorded at the county recorder's office. And that had not been done.

So regarding the second instances of this title issue...I am representing a buyer of a property whose owner had passed away. I received a copy of the preliminary title report from the title company, and it again named an individual as the property owner, rather than a Trust entity as the owner. Inspections were completed, the transaction was rolling forward nicely, and the buyer's loan documents on the way...BUT the Successor Trustee can't sell the house, because again he does not have full authority to do so, because a new Deed naming the Trust as the property owner was never recorded. UGH.

So what do we do to remedy this situation? Well, the Successor Trustee must schedule a Sacramento County court hearing, and file what is known as a Heggstad Petition so that the home does not have to go through the probate process. This process, from what I have been told, can take about two months from start to finish.

My seller client in scenario one has this Heggstad Petition process underway, and we are not listing it until he has been granted full authority. Definitely an inconvenience, as the seller wants to get back to his life in Puerto Rico...but our proactivity will be rewarded with the ease of being able to list and sell the home in a few weeks.

My buyer client in scenario two, however, is getting the short end of the stick. We are just a week from our scheduled closing, and the Heggstad Petition process is just now getting underway. He will loose his interest rate lock. He must postpone his move. UGH.

The moral of the story - if you have a Living Trust, or are planning to create one, PLEASE be sure to record a new Deed so that not only is the house named in the Living Trust, but so that the Living Trust actually owns the house! If you have an elderly parent, it probably makes sense to check to see if this has been done for their trust. You will potentially save yourself lots of time and money later.

The world looks amazing from a two-wheeled vantage point...

If you follow me on Facebook or Twitter, you will know that last week I ordered a new bicycle! It arrived pretty quickly on Thursday, and I have been out toodling around on it a lot since then. My neighborhood is truly a serene, beautiful place from the vantage point of a bicycle. I do not usually give testimonials for places I visit or purchase things at, but I want to give some kudos to the folks at City Bicycle Works on K Street at 24th Street in Sacramento. I visited several bicycle shops as I was contemplating my purchase. At one point, I walked into one with my mind made up as to which bike I wanted, and the employees at this particular bike shop (which shall remain nameless) were so rude that I left empty-handed. When I finally visited City Bicycle Works, the bike guy (his name was Gordon) was SO nice and helpful, it was a no-brainer that I should make my purchase there.

New Listing - 11878 Pyxis Circle, Rancho Cordova / Anatolia 95742

Classy 4-5 bed, 3.5 bath, 3,470sf Anatolia Rancho Cordova Home! You will fall in love with the stylish decor, separate living and family rooms, downstairs bedroom and bathroom, amazing kitchen, granite counters, island, large master suite with fireplace, luxurious master bathroom, loft/possible 5th bedroom, 3-car garage, and large fully landscaped backyard with waterfall. Don't wait! Offered at $365,000, subject to lender approval of short sale. For more photos and additional detail, visit http://11878PyxisCircle.com.

New Listing - 6314 Perrin Way, Carmichael, CA 95608

Amazing Carmichael Barrett Hill 4 bed, 3 bath, 2,218sf home! You will fall in love with the stylish decor, separate living and family rooms, vaulted ceilings, kitchen with LOTS of cabinet/counter space, large master suite with fireplace and sitting area, luxurious master bathroom, 3-car garage, and serene backyard with deck and patio. Don't wait! Offered at $349,000, subject to lender approval of short sale. For more photos and additional detail, please visit http://www.6314PerrinWay.com.

Buyers - having trouble getting into contract on right house? The solution may be a more creative Realtor...

If you read my blog post about my little vacation from last week, you will know that I closed a buyer transaction in Garden of the Gods. I wanted to share a little success story about how this transaction came to be, but wanted to wait until after the close of escrow as to not jinx the outcome!

If you are a Sacramento area home buyer, you will know that certain price ranges and certain neighborhoods are extremely competitive - often with properties getting multiple competing offers. My buyer clients were planning to relocate from the bay area to Sacramento, and specifically wanted to live in the Garden of the Gods neighborhood. Unfortunately, at the time they were looking (this was in January), there were only 4 active listings in Garden of the Gods. They wanted to buy sooner rather than later, as they were first time home buyers - and they wanted to take advantage of Federal Home Buyer Tax Credit that is available if they were in contract by April 30th, and closed by June 30th, 2010.

So I put on my thinking cap...

I went into MLS and looked up past listings - ones that did not sell for one reason or another, and were eventually withdrawn or expired. I found a property that had been on the market last summer that seemed to be exactly what my buyer clients were looking for. It was not a foreclosure, and not a short sale either! I called the former listing agent and asked if those sellers were still interested in selling the house. YES of course, she said, and they were planning to re-list it later in the spring. I arranged a showing of the house for the last weekend in January. The house was not on the market.

We toured it, and my buyer clients LOVED the house. We immediately went back to my office and wrote an offer. The sellers then countered, and my buyers accepted the seller's counter offer.

SO.....my buyer clients were able to purchase a great home that fit their needs that was not on the market, in a neighborhood with very little listing inventory, in a non-competitive situation. Given the current brisk, competitive state of the market in that neighborhood and in that price range, what could be better than that? A win-win for everyone involved!

The bottom line - get creative! There are ways to circumvent the market conditions. The buyer's agent will have to do a little more work in order to make this happen, but if you have a Realtor that is not savvy enough to do this, or not willing to go the extra step, you may be working with the wrong Realtor.

Home, Sweet Home in Sacramento...even Realtors take vacations!

Yes yes...the rumors were true - my mom and I took a week-long vacation in Mexico. I returned last night, and of course am right back to work today! Thankfully, I have a great assistant who helped to keep things in order while I was gone, though I still checked in frequently. Closed a buyer transaction on a great Garden of the Gods home and got a Wells Fargo Natomas short sale approved while I was gone!...I should vacation more often!

Lyon Real Estate Sierra Oaks - Top Listing Agent for the 2nd Month in a ROW!!

I am beyond thrilled to keep my preferred parking space again this month! Again, I was the top listing agent in the Lyon Real Estate Sierra Oaks office of about 130 Realtors for the month of February 2010. I achieved Top Listing Agent twice like this in a row back in mid-2008 also, and have achieved Top Listing Agent for my office numerous other times (in non-consecutive months)...including the fact that I listed the most property in my office for all of 2009...

Like a mullet; business in the front, party in the back!

So if you know anything about me personally, you will know that I am a big goofball. I am definitely very professional in the business and real estate environment, however I do like to have fun in pretty much everything I do. I also like to surround myself with like-minded people, so the folks I work with in my transactions on a daily basis are generally very professional as well, but have silly sides.

Case in point. The escrow officer I like to work with at Placer Title is one of the most organized and thorough escrow officers that I know...with all of my short sales and such, it is critical that the escrow officer I work with be really on top of things, and bless Anne Chatfield, she is! In addition to being the great escrow officer that she is though, she has a great sense of humor and is pretty darn hilarious.

So early last week, I was having a minor medical procedure (nothing serious), and had to have blood drawn first thing Monday morning. Over the weekend, I had successfully negotiated an offer on one of my listings, and forwarded the fully executed contract over to Anne so she could open escrow. So in the waiting room I sit, checking my email on my iPhone. I received a very dry email from Anne, cc-ing the buyer's agent, with the escrow information. I replied to her that those types of dry emails make me laugh because that generally is not how we deal with each other. She quickly replied - "It's my "business" side! I am like a mullet- business in the front and party in the back!" Let's just say my outburst of laughter in the middle of the quiet lab waiting room startled several of the other folks in there.

Well now, I certainly can't let a gem like that one go unnoticed, can I? Once I got home later, I went to Amazon.com and ordered an inexpensive Mullet wig and had it delivered to Anne at her office. What a great sport...she wore it and emailed me a photo! Our joke now is that she will have to wear it at the next escrow signing she does for one of my clients! Hmm...wonder who my lucky client will be?

New Listing - 2091 Arliss Way, Sacramento, CA 95822

This 3 bed, 1.5 bath Golf Course Terrace fixer home is a diamond in the rough! A blank canvas awaiting your personal touches, this house has a nice layout, spacious living room and large bedrooms. This sale is subject to both lender approval of short sale, AND probate court approval. Offered at $79,000. For more photos and additional detail, please visit http://www.2091ArlissWay.com.