Dec 28, 2009

Land Banking: Time to re-Start ??

Happy Holidays Neighbors!

May 2010 bring you health and prosperity.

Tomorrow, Jenny and I are going to look at vacant land in a couple of the resort areas in California's Plumas County. We've been watching that area for 11 years now. Jenny's family has owned property there for at least 25 years.

That market has bottomed, and it's time to consider "land banking" an investment lot or two for the near future. Property in some of these locations are selling at less than 20% of market value from a few years ago. If you can sit and fund the HOA dues, this should create healthy returns four or five years out.

This isn't nearly as risky as the "Winchester" development outside of Auburn, California. We've done background checks on their financials and market plans.

Call if you want to discuss.

Again, happy holidays from everyone at Neighborly!

- Jim

Dec 17, 2009

Movies! Watch these Videos on Loans

Hello Neighbors,

The Neighborly Financial team is at it again.

Home financing is a tough process, especially in this market. The NF team recently created a few new YouTube movies to help educate and inform.

Take a look when you get a moment.

How To Get the Best Interest Rates:

Pre-Qualify for a Loan:

Choosing the Right Lender:

Our video production staff is top notch, but our budget isn't - so please be kind !!

Many thanks, and enjoy the videos. Please do share with friends and family.

Should you need more information (or want to talk to our in-house movie star), John can be reached at 916.799.4336

- Jim

Dec 16, 2009

New Consumer Help Web Site from the National Association of Realtors

Hello Neighbors,

This just out from NAR (the National Association of Realtors). The new web site is still in beta (test) mode, but try it if you'd like and share your feedback. We've linked it to the blog via the section to the right called "TOOLS".

Here's the site:

Here's its purpose:

To bring ideas and content to homeowners - and future homeowners - for improvement projects, clean living, energy savings ideas, tax savings, refinance concerns, and a variety of different topics.

NAR is trying to make home ownership an better understood process, and provide solutions to those who need a hand in projects that involve your own real estate.

My thoughts:

I like the content around tax breaks and energy / green alternatives. The "manage a project" engine is interesting, but time will tell if you find it useful (let me know!).


- Jim

Dec 15, 2009

Home Sales Up Again - 2010 Looks Promising

Hello Neighbors,

GOOD news from our friends at NAR (the National Association of Realtors). They posted this content recently, and we thank them for their insight.

"Pending" ("used" homes, not new construction) home sales have been up for 9 months in a row now. 2009 is almost done, and I think we will look back on it as the start of the recovery - or at least the end of the slide.

Impacts to you?

Buyers? 2010 could be competitive.

Sellers? 2010 will see stability in your home values, and increases in value for certain price ranges / market segments (especially first time buyer homes).

Here is the NAR report:

Nine Consecutive Gains for Pending Home Sales

Washington, December 01, 2009

Pending home sales have risen for nine months in a row, a first for the series of the index since its inception in 2001, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in October, increased 3.7 percent to 114.1 from 110.0 in September, and is 31.8 percent above October 2008 when it was 86.6. The rise from a year ago is the biggest annual increase ever recorded for the index, which is at the highest level since March 2006 when it was 115.2.

Lawrence Yun, NAR chief economist, said home sales are experiencing a pendulum swing. "Keep in mind that housing had been underperforming over most of the past year. Based on the demographics of our growing population, existing-home sales should be in the range of 5.5 million to 6.0 million annually, but we were well below the 5-million mark before the home buyer tax credit stimulus," he said. "This means the tax credit is helping unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future.

The PHSI in the Northeast surged 19.9 percent to 100.2 in October and is 44.2 percent above a year ago. In the Midwest the index rose 11.6 percent to 109.6 and is 36.6 percent higher than October 2008. Pending home sales in the South increased 5.4 percent to an index of 115.4, which is 31.6 percent above a year ago. In the West the index fell 11.2 percent to 127.7 but is 21.9 percent above October 2008.

Yun cautioned that home sales could dip in the months ahead. "The expanded tax credit has only been available for the past three weeks, but the time between when buyers start looking at homes until they close on a sale can take anywhere from three to five months. Given the lag time, we could see a temporary decline in closed existing-home sales from December until early spring when we get another surge, but the weak job market remains a major concern and could slow the recovery process.

"Still, as inventories continue to decline and balance is gradually restored between buyers and sellers, we should reach self-sustaining housing conditions and firming home prices in most areas around the middle of 2010. That would mean broad wealth stabilization for the vast number of middle-class families," Yun said.

The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

# # #

*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity from 2001 through 2004 parallels the level of closed existing-home sales in the following two months. There is a closer relationship between annual index changes (from the same month a year earlier) and year-ago changes in sales performance than with month-to-month comparisons.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales.

Existing-home sales for November will be reported December 22 and the next Pending Home Sales Index will be on January 5; release times are 10 a.m. EST.

Many thanks,

- Jim

Thinking of Selling in 2010? Use a Certified Negotiation Expert !!

Hello Neighbors,

2010 feels good. OK, it's not here yet, but it sure feels like it has promise.

If you need to sell next year, do your best to protect your family and your financial interests - higher a Certified Negotiation Expert (CNE).

The CNE is the designation recognized by the National Association of Realtors as the premier training mechanism for negotiation strategy.

Need a compelling reason to call? How is this statistic: To date, only 7,000 Realtors and Brokers across the United States (of the 1,300,000 Realtors nationwide) are CNE trained. That’s less than 1% of the Realtors out there.

Do you want to work with the best 1% in the business, or the other 99% who treat your sale – your most important financial step in life – as simply another transaction?

Make sure you use a CNE! To learn more about the CNE credentials, click here:

I've had over 7 years of formal business school (BS and MBA degrees). NONE of those programs covered negotiation as well as this certification program.

When the time comes to sell, or if you know someone who is thinking along these lines, make sure to consider hiring a Certified Negotiation Expert (CNE).

Let's make 2010 great,

- Jim

Planning to Purchase in 2010? Try to Act before April 30th - TAX Credits !!

Hello Neighbors,

If you are planning to buy a home (your first, or a "trade up"), you may want to start the process before April of 2010.

Tax Credit for First-Time Homebuyers

FTHBs (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

Tax Credit for Current Homeowners

The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

What are the New Deadlines?

In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010. Those in the military do have some special extensions on the timelines available.

What's So Important About a "Tax Credit"?

The benefit of a tax credit is that it's a dollar-for-dollar benefit, rather than a "tax deduction", or reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer who qualified for the entire benefit were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little or no income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!

Home financing is never an easy thing to wrap your head around. It seems like there is an ocean of financing options available for buyers these days, and it's incredibly hard to figure out which option is right for you. Not every financing option works for all people, it's important to have a trusted and experienced real estate team leading you through the home buying process. There is no doubt in our mind we can guide you through your home financing and provide you with the best options.

We would love the chance to talk about what it takes to buy a home in today's marketplace and what sort of financial options are available to you. Neighborly Realty's partner "Neighborly Financial" has access to loan products from dozens of lenders. When the two companies are able to combine services for the same client, the savings to that client are in the THOUSANDS of dollars.

Please call or email with any questions or concerns or just to talk about your real estate options. We look forward to hearing from you.

Happy Holidays,


Nov 20, 2009

Sacramento County Sales Statistics

Hello Neighbors,

My apologies for the drop in blog activity.

We are just coming back up to speed after Strep Throat and Scarlet Fever ran through the household. Not much fun!

Blog activity will probably be slow until early December too, as we will be with family for Thanksgiving.


Here's one bit of market data to keep you going...

In Sacramento County for the last month - 25.2% of home sales were funded with all cash. Roughly 27.6% of home sales were with FHA first time buyer type loan products.

39% of homes were bought with conventional loan products (likely using standards driven by FHA).

What does it mean?

A bit over half of the activity last month was a continuing battle between investors and first time Buyers.

I'm pulling for the first time Buyers!

Again, Happy Thanksgiving,


Nov 5, 2009

$6500 Buyer Tax Credit to Existing Home Owners !!


Hello Neighbors,

This note comes to us from our good friend Kat Fiorentino at First Priority.
As you read in this blog a few days ago, the $8000 first time buyer tax credit was extended until April of next year.

.....and now? A tax credit for anyone buying a home – it doesn’t matter if you are a first time buyer or a current owner trading up!

YES - you can take advantage of these insanely low prices and interest rates, "Trade Up", and get money back from the federal government.

Details from Kat’s message are below. Thanks again Kat!

First-time homebuyers have been getting tax credits of up to $8,000 since January as part of the economic stimulus package enacted earlier this year. But with the program scheduled to expire at the end of November, the House voted 403-12 Thursday to extend and expand the tax credit to include many buyers who already own homes. The Senate approved the measure Wednesday, and the White House said President Barack Obama would sign it Friday.

Buyers who have owned their current homes at least five years would be eligible for tax credits of up to $6,500. First-time homebuyers — or anyone who hasn't owned a home in the last three years — would still get up to $8,000. To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010, and close by June 30.
"This is probably the last extension," said Sen. Johnny Isakson, R-Ga., a former real estate executive who championed the credits.

The homebuyers tax credit is one of two tax breaks totaling more than $21 billion that was included in a bill extending unemployment benefits for those without a job for more than a year. The other would let companies now losing money recoup taxes they paid on profits earned in the previous five years.

"We are still in a world of economic hurt, and Congress must continue to act boldly and creatively," said Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee. "With the right mix of tax breaks and investments we will get through this recession and get folks working again."

The real estate industry has been pushing to extend and expand the housing tax credit. About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.

Extending and expanding the tax credit for homebuyers is projected to cost the government about $10.8 billion in lost taxes. While the measure passed the Senate by a 98-0 vote, Sen. Kit Bond, R-Mo., questioned its efficiency in stimulating home sales.

"For the vast majority of cases, the homebuyer tax credit amounted to a free gift since it did not affect their decision to purchase a home," Bond said. "And for the small minority of buyers whose decision was directly caused by the credit, this raises the question of whether we are subsidizing buyers who may not have been able to afford buying a home in the first place."

The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

The credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.
Expanding the tax credit for money-losing companies is projected to cost $10.4 billion.

The business tax break would allow money-losing companies to use current losses to offset taxable profits earned in the previous five years, giving them refunds of taxes paid in those years. Under current law, businesses with annual gross receipts of more than $15 million can claim losses back only two years.

The tax break would help industries suffering losses in 2008 or 2009, including retailers, homebuilders and newspapers. Congress included a scaled-back version of the tax break — for companies with revenues of $15 million or less — in the economic recovery package enacted in February. The new tax break would be available to companies of any size, providing a quick source of cash.

The U.S Chamber of Commerce has been a big backer of the tax break for money-losing companies.

"It frees up capital that they can use to maintain jobs and potentially even hire new people as the economy returns," said Caroline Harris, senior tax counsel for the U.S. Chamber of Commerce.

The tax breaks would be paid for largely by delaying a tax break for multinational companies that pay foreign taxes. It was passed in 2004 and originally was to have taken effect this year, but would now be delayed until 2018.

The bill is H.R. 3548.

Woo Whoo!

2010 is going to be on fire!

- Jim

Oct 29, 2009

First Time Buyer Tax Credit Extended

HELLO Neighbors !!!

GREAT news today!

The first time buyer tax credit is getting extended. Buyers have to be in contract by the end or April.

For us car guys, "Cash for Clunkers" was fun... but we knew it would only spur short term demand and sales volume upticks. THIS? This is how you bring the economy back!

From the Wall Street Journal:


WASHINGTON -- Senate negotiators reached a tentative deal to extend a tax credit for first-time home buyers, but its passage remains uncertain.

The agreement would extend the existing credit for first-time home buyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners, Senate aides said. The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years.

The new provisions are aimed at broadening availability of the credit beyond first-time buyers and giving the weakened real-estate market a bigger boost while preventing real-estate investors from benefiting.

Many property experts have cited the credit as a reason for signs of recovery in the housing market in recent months. But that recovery was somewhat undercut by the September drop in new-home sales reported Wednesday.

The credit would be extended from its current expiration date of Dec. 1 to all contracts entered into by April 30, and closed before July 1. It is expected that income limits on people claiming the credit would be increased to $125,000 for singles and $250,000 for couples, from the current $75,000 and $150,000, aides said. The credit phases out for people making more than those amounts.

.While Senate lawmakers appear to have reached a deal on the substance of the tax credit, they are still at odds over how it would be brought to the Senate floor. Senate Majority Leader Harry Reid (D., Nev.) hopes to add it to a bill currently on the Senate floor to extend federal unemployment insurance benefits. But agreement on that hasn't been finalized.

While Senate Republicans are likely to support the measure, House Democrats have raised concerns that it carries a high cost to the government. The Internal Revenue Service is examining the program for alleged abuse.

Thank you Wall Street Journal for the content!

This is wonderful and fantastic news.

- Jim

Oct 27, 2009

Home Values in California to RISE in 2010 !!

Hello Neighbors,

A great update from CAR (California Association of Realtors) economists!

This echoes what we've been saying (and hoping) for the last year - 2010 should be a year of recovery, although some significant unknowns still exist (bank owned homes, Fed bailout programs).

Thank you CAR for the data!

LOS ANGELES (Oct. 7) –“California’s housing market continued its strong sales rebound this year, resulting from the continued pace of distressed properties coming to market,” said C.A.R. President James Liptak. “This follows two years of double-digit sales declines in 2006 and 2007. Looking ahead, we expect sales to moderate to a more sustainable pace.”

The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) "2010 California Housing Market Forecast" will be presented this afternoon during CALIFORNIA REALTOR® EXPO 2009 (, running from Oct. 6-8 at the San Jose Convention Center in San Jose, Calif. The trade show is expected to attract more than 7,000 attendees and is the largest state real estate trade show in the nation.

“After experiencing its sharpest decline in history, we expect the median price to rise modestly next year,” Liptak added. “2010 will mark the beginning of the ‘new normal’ for California’s housing market. This ‘new normal’ likely will feature a steady stream of sales driven by distressed properties in the low end of the market, coupled with moderate home-price appreciation.”

The median home price in California will rise 3.3 percent to $280,000 in 2010 compared with a projected median of $271,000 this year, according to the forecast. Sales for 2010 are projected to decrease 2.3 percent to 527,500 units, compared with 540,000 units (projected) in 2009.

“Housing in California has become a tale of two markets,” Liptak said. “The low end continues to attract first-time buyers and investors, with a resulting shortage in the number of homes for sale. Sellers at the high end, however, continue to be challenged by the ability of home buyers to secure financing as well as their concerns about where prices are headed. While demand from first-time buyers for low-end properties will continue throughout next year, sales could be impacted if discretionary sellers do not return to the market by the second half of 2010.

“2009 marked a unique opportunity for first-time home buyers,” Liptak said. “Homes were more affordable than they have been in years, interest rates hovered near historic lows, and the federal tax credit helped more than 1 million people become homeowners nationwide. Now is the time for Congress to extend the federal tax credit and to expand it to all buyers, not just first-timers.”

“With distressed properties accounting for nearly one-third of the sales in 2010, inventory will be relatively lean, under six months during the off-season months, and a roughly four-month supply during the peak season,” said C.A.R. and Vice President Leslie Appleton-Young. “We expect the median price to decrease slightly through the remainder of 2009 and into next year, then rise before leveling off next summer. For the year as a whole, home prices are forecast to reach $280,000.”

“Although it appears at this time that lenders are closely monitoring the flow of distressed properties onto the market, there could be an exertion of downward pressure on home prices should a heavier than expected wave of foreclosures come to market next year,” she said.

“The wild cards for 2010 include foreclosures, loan resets, the labor market, and the California budget crisis, as well as the actions of the federal government,” Appleton-Young said.

- Jim

Oct 21, 2009

Neighborly Financial - now a "Tier 1" Wells Fargo Direct Lender

Hello Neighbors,

Congratulations to Neighborly Financial, John Graham, and his team.

That group is now a direct lender with Wells Fargo. Even better, they hold a "Tier 1" status - which means real dollars to clients. That status drive a further reduction in costs of at least .25%.

Nicely done Neighborly Financial!

- Jim

Oct 13, 2009

C.A.R. Confirms - Longer Escrow Periods Likely

Hello Neighbors,

As mentioned in a blog article from a couple of months ago, be ready for potential extensions in escrows due to changes in financing regulation.

But... don't just take our word for it, take a look at what the California Association of Realtors (CAR) just published.



Starting July 30, 2009, if the APR on an initial Good Faith Estimate is no longer accurate (within a 0.125% range) at close of escrow, a lender must generally provide a residential borrower with a new disclosure and a three-day right to rescind before consummating the loan. REALTORS® are forewarned that, because of this new three-day waiting period, a lender's failure to timely provide corrected disclosures has the potential of delaying funding of the loan and close of escrow.

This new requirement is part of the Mortgage Disclosure Improvement Act (MDIA) implementing new loan procedures to protect borrowers and foster greater transparency in mortgage lending. For loan applications submitted on or after July 30, 2009, the new MDIA changes to the Truth in Lending Act are generally as follows:

Applicability: The new MDIA rules pertain to federally-related mortgage loans covered under RESPA and secured by a consumer's dwelling. The rules apply to both purchase and refinance loans.

Early Disclosures: A lender must provide a borrower with an initial Good Faith Estimate within three business days of receiving the borrower's written loan application as specified. For this provision, a "business day" is generally defined as a day on which the lender's offices are open for business.

Upfront Fees Restriction: Neither a lender nor any other person may impose an upfront fee on the borrower (except for credit report) until the borrower has received the early disclosures in person or, if mailed, three business days after the early disclosures are mailed. For this rule, a "business day" is defined as all calendar days except Sundays and legal public holidays as specified.

Seven-Day Waiting Period: A lender must wait seven business days after providing the early disclosures before consummating the loan. For purposes of this waiting period, a "business day" is defined as all calendar days except Sundays and federal legal holidays as specified. A borrower may waive the waiting period in writing in case of personal financial emergency, such as an imminent foreclosure sale.

Re-disclosure Requirement: If the final Annual Percentage Rate (APR) at loan consummation varies more than 0.125% (or 1/8 of one percent) from the initial APR on the early disclosures of a regular transaction, the lender must provide the borrower with a corrected disclosure at least three business days before the loan is consummated. For purposes of this waiting period, a "business day" is defined as all calendar days except Sundays and federal legal holidays as specified.

Three-Day Waiting Period: For corrected disclosures, a lender cannot consummate a loan until three business days after the borrower receives the corrected disclosure in person. If the corrected disclosure is mailed, the borrower is deemed to have received it three business days after it is placed in the mail. A borrower may waive this waiting period in writing in case of a bona fide personal financial emergency, such as an imminent foreclosure sale.

Source: The new MDIA rules and regulations are set forth at 74 Federal Register 23,289 (May 19, 2009) (to be codified at 12 CFR 226) available at

Again, our sincere thanks to CAR for this content.

- Jim

Oct 2, 2009

Neighborly Financial Joins Calaveras County Search & Rescue Efforts

Hello Neighbors,

John Graham, manager of Neighborly Financial is back.

He's been gone for the last several days, helping a search and rescue effort in a neighboring county.

From John:

I went to help search for the missing deer hunter in Calaveras County, last Wednesday. We spent all day looking for the subject. We were able to track his footsteps from the truck for about 7 miles, step by step, until darkness forced us to retreat for the night. Attached is a photo of the footprint we were following during the Calaveras County search. As of Friday, his location is still unknown. I have no details on the outcome, other than he is alive.

I am a member of the Placer County Sherriff's Search and Rescue team. We are recognized as one of the largest and better trained teams in the state, and therefore we get called out to assist with searches in many other counties. We assist with both backcountry and urban searches, for missing hikers, hunters, motorcycle riders, children and Alzheimer's patients. We also assist the Sherriff with evidence searches for criminal cases. We get called out about once or twice a month. Volunteers spend many hours training and in the field on searches. We all serve as ground searchers, willing to hike in any conditions and any terrain, but also we are divided into teams with specialties in 4WD, radio communications, motorcycles, mountain rescue, horses, and canine search, to name a few.

NICE work John. Another example of supporting our local community. We love doing it, just wish it wasn't a tough story.

Our thoughts go out to this family as they continue the search,


Oct 1, 2009

"Shadow Inventory"

Hello Neighbors,

I attended this month’s Finance Forum (meeting) at the Sacramento Association of Realtors branch office.

Interesting stuff.

A term we’ve been hearing more and more of recently was discussed….. “Shadow Inventory”.

What is Shadow Inventory?

Homes that are in some sort of Notice of Default (NOD) or foreclosure proceedings… but haven’t yet been taken back by the banks. Meaning? Homes that are vacant – or will be soon – that aren’t yet being reported on the bank’s financial books.

How much?

I heard an estimate this morning that shocked me: 35,000 – 40,000 homes in the “Greater Sacramento area”. Now that area probably includes parts of Sacramento County, Placer County, and even El Dorado County. If those numbers are correct, it is a HUGE amount of homes that will some day come to market. If. If. If.


Obviously, if such numbers exist, that has huge macro-economic implications. Prices will drop. Banks will be in financial trouble. Buyers will benefit – if they can get loans. Sellers will have to hold tight for much longer, or compete with insanely low price points.

HOWEVER, there is a problem – accurate data.

No one has actually published the data we need to verify such speculation. Search MLS and you will find that there isn’t much bank owned inventory now. It’s dried up. You can search county tax records, but those tools aren’t very user friendly. It would take days and days to compile such data. One industry professional says the inventory is there… another say the Obama plans have curbed the problem.


We continue to listen. Speculation runs from all ends of the spectrum. If we had the data, we could guide you in the right direction. Until then, we (all of us in this industry) continue to be reactive instead of proactive.

I’m looking forward to changing that behavior.

- Jim

Home Sales Are UP !

Hello Neighbors,

Two blog posts today....

The first one is from the NAR (National Association of Realtors) chief economist - Lawrence Yun - on the recovery underway! Thanks NAR!

The second? Direct contrast to the first. "Shadow Inventory". Stay tuned... here's the first:

Headed in the Right Direction:

Numbers Show Sales are Up and Heading in the Right Direction

Pending home sales in July reached their highest mark in two years, and closed sales also continued on an upward path. As a result, inventories are tightening; in June there were 3.8 million properties for sale nationally, compared with 4.5 million at the same time last year.

More broadly, there are other indications the economy is heading up. Durable goods orders have risen for three straight months because business inventories have been depleted. The stock market has also made a nice comeback, and exports have been rising faster than imports.

Thanks to these promising signs, we forecast higher home sales and stabilizing prices in the year ahead. But there are still some concerns.

First, although inventories are improving, it’s possible that many owners want to put their house on the market but are waiting for conditions to improve. Banks may be doing the same with their foreclosed properties. These concerns might be off the mark; in areas where housing has been recovering, we would expect to see inventories softening as ¬sellers and banks jump back in, but we haven’t been seeing that.

Beyond the housing market, there are other economic factors that could hold back recovery. The country is looking at a continuing long-term budget deficit that could translate into higher mortgage rates. We’re also looking at rising oil prices ($70 from $50 earlier this year), with that extra money shipping overseas rather than staying home. And heavy job losses make it likely foreclosures will keep rising through the remainder of the year.

Still, we have reason to be confident. With home sales heading up and inventories shrinking, prices are stabilizing. These are the key conditions needed for housing to lead the economy into growth mode. Once that happens, jobs will follow.

Thanks NAR, the recovery is more than a welcomed visitor... it's a way overdue guest.

- Jim

Sep 29, 2009

New Listing in Plumas Lake + No REOs !!

Hello Neighbors, follow up that last "search engine helper" blog post, here is some market news.

We just went live with a listing in Plumas Lake. That's about 10 minutes south of Marysville (in Yuba County).

That is an area like Lincoln (Placer County) that was overbuilt during the boom. Plumas Lake is much smaller in scale, but experienced similar swings. ...oh, and there is no actual "lake" in Plumas Lake.

Why should you care?

a) The house we have listed is really nice - 2041 Maverick Drive

b) The market research we did before going live was fascinating. There were 51 homes on the market in the area: 50 were short sales, and 1 was an investor flip (good luck). There were NO (Zero, Zilch) bank owned or "REO" homes. None. Amazing.

To have such an area as Plumas Lake without REO homes tells us some important information... foreclosure inventory has dried up, and banks aren't releasing those homes to the marketplace.

When (if?) will those foreclosure homes come to market? We don't know. The industry experts all have different opinions. We pay attention to the data. Once the data shows a story, you'll get an update through this forum.

- Jim


Hello Neighbors,

That's our toll free number.

This blog post isn't industry news or an update on our services... it's simply an entry to help the search engines.

Please excuse the odd use of the blog space.

It appears that a collections company in Utah (we think it's Utah) is using our number inappropriately.

We wanted to help clear this up by getting out a note to those who may be Googling the 18009600860 or 1-800-960-0860 number.

If you find this blog entry when searching for your collections agency / company... know that the number is wrong. We wish you the best of luck, but can't help you with your search. The 1.800.960.0860 number is used to provide real estate and lending services, certainly not collections! We are not related to a collections company in any way.

While we enjoy entrepreneurship, "Neighborly Collections" certainly isn't a business model we are pursuing!

Good luck.

- Jim

Sep 22, 2009

"Nice Guy Realty & Loans"

Maybe that's what we should be called...

Hello Neighbors,

I just spoke with a gentleman who needs a home loan - his first.

In the conversation we learned that he has great credit, makes a good living, doesn't yet have a mortgage, and would be the ideal borrower.

We also learned that he has an auto loan with Golden One Credit Union, and that he was in the military several years ago.


We sent him away!

Yep. First, we told him to contact Golden One (the credit union). If he has a consumer debt instrument (car loan) with them, he may be able to combine that existing auto product with a home loan, and qualify for a greater purchase price (while keeping his overall expenditures down).

Second, we told him to call USAA (1-800-531-8722). They have loan programs and fees that are tailored specifically to veterans and service personnel.

Third? We told him to call us back if he wanted to - but that he would likely save money if he went with Options 1 or 2.

We get into conversations like this all the time. It may not help our bottom line much, but it sure helps with our karma accounts.

...problem is, karma doesn't blog.


Sep 18, 2009

Auburn Fire Benefits This Weekend

Hello Neighbors,

Flyers just arrived... thanks for passing our way. The flyers will be linked off of the Neighborly Realty & Neighborly Financial Facebook page if you'd like copies.

Two events this weekend to help with the Auburn Fire victims:

Saturday, September 19th and Sunday, September 20th - Pancake Breakfast at Applebee's on Bell Road! 8:00am - 10:00am $6.00 per ticket, 100% of donations going to the Auburn Disaster Relief Fund. You need to buy tickets ahead of time, and can get them at Applebee’s (along with a few other Auburn locations).

Sunday, September 20th - Benefit in the Park. Regional Park in Auburn, Noon - 7:00pm. 6 different bands, beer garden, food, inflatable rides for kids, and a bunch of other stuff. Donations are being accepted by Community First Bank. More info at

Sorry for the late notice, but we hope to see you there!

- Jim

Sep 16, 2009

Our Vision

Hello Neighbors,

From time to time, it's important to look at why we are here. Keeping us focused on a few fundamental beliefs means better service levels for you.

So now and then, we ask ourselves - what is Neighborly's Vision?

Where do we fit against the competition?

How do we behave, and represent the Neighborly Way every day?

Simply stated......

THE Choice

By Delivering Unequaled Customer Service, Neighborly is the Recognized Leader in Real Estate and Lending Services in Northern California - By Clients, Partners, and Industry Professionals.

Neighborly Offers a Fully Integrated Suite of Services to Meet and Exceed Client Expectations. Neighborly is THE CHOICE in Real Estate and Lending Services.

We believe it. We practice it. We welcome the opportunity to prove it to you.

- Jim

Sep 4, 2009

What is "The Neighborly Way"?

Hello Neighbors,

Many thanks for those of you who have helped us support the Auburn "Highway 49 Fire" relief efforts. We plan to drop off another huge batch of clothing this weekend. This is a great community, and we very much appreciate the support from everyone.

For us... This is more than propaganda. Helping the communities where we live is part of our operating philosophy we call "The Neighborly Way". Take a look at point #9:

The Neighborly Way

1) Service - NOT Sales

2) Be the Industry and Market Expert

3) Advisors, Coaches, and Teachers

4) Respect for the Client, Team Member, Partners, and Peers

5) Communicate Frequently - with Fact, Tact, and Truth

6) Integrity First, Honesty Always

7) Earn and Encourage Trust

8) Personal Earnings are Second to Client Service and Their Satisfaction

9) Repay our Communities, Promote Charity

10) Protect and Promote the Environment

11) Deliver a Single One Stop Shop Experience

12) Unwavering Belief in The American Dream

Our name was chosen very intentionally. "Neighborly" is the way we conduct ourselves. These points guide our decision making and our actions. The "Neighborly Way" is much more than a simple tagline - it's how we live.

Thanks again,


Sep 1, 2009

Auburn Fires - THANK YOU and Important Lessons

Hello Neighbors,

Our heart goes out to our friends and family who were impacted by the fires in Auburn on Sunday. Two of Neighborly’s own (Juli Marty’s family and mine) were impacted by the fires – although no damage.

A sincere thank you to the fire fighters and the pilots flying the 14 aircraft over our heads. An amazing job performed by these professionals.

We were told to evacuate at round 3:30pm on Sunday. ….exactly when we were getting home from a weekend out of town. There were “reverse-911” messages on our home answering machine. It took us an hour to go the last mile to our house, and we could see the smoke + fire the whole time. We were on the phone trying to get in touch with neighbors and family while driving that last mile. Our cell phones kept dropping, and we could see the 14 aircraft flying over our house. 20 minutes after getting to our house (and hearing the voice messages from the sheriff), we lost electricity.

It was nuts.

The fire never crossed over to our side of 49, but we didn’t know that until well past 11:00pm on Sunday night. We had no electricity, and only 1 battery powered 1980s style walkman radio to get news. At one point I jumped on my old Schwinn cruiser to head to the fire to get my own news. We were hearing on the radio that 84 lumber and other businesses had burned to the ground, and that our side of 49 was getting burned as well. Once I got back to the house from my bike ride, we decided we could relax a bit – but we still left the cars packed.

Since we have a 3 month old baby and a 3 year old toddler… it added about an extra million layers of challenge to the whole process… All of our neighbors were packing up and asking us what we needed for the kids. VERY KIND group of folks.

My wife was packing diapers, photo albums, baby clothes, our home movies, etc…. while I was outside running hoses and putting ladders up to the roof. My truck battery was dead – and no electricity at the house – so I was pulling batteries from other cars to try and get the truck running…. Wow. All in parallel with trying to get updates from my parents and aunt on their homes… 7 or 8 hours of pure adrenaline is enough to make a guy (a family) tired.

It taught us some important lessons, if I may share:

a) ABSOLUTELY make sure you have good battery powered radios in the house. We bought a hand-crank radio at Home Depot yesterday. We have lots of batteries for the kids toys… which meant power for flashlights too.

b) Centralize those things that you would take out in a fire. If you get the call to evacuate, you really don’t have the kind of time you think you will have…

c) Talk to your neighbors about what they would like pulled out of their houses in an emergency. We didn’t even have our neighbors cell phone numbers to do any coordination…

d) Keep those car (truck!) batteries charged. BAD mistake on my part. You can get a lot more into a full size GMC truck than a Toyota Prius.

e) News is 50% rumor, and wrong. We were told at different times that the fire was on our side of Highway 49 (it never was) and that several of the local business had burned to the ground – like 84 lumber (it did not). It’s best to be prepared for different contingencies, since the news didn’t keep up well with reality.

f) Not much else in the house matters except having clothes for your kids ready.
a.) Jenny (my wife): “I’ve got the baby stuff packed, what do you want of yours”?
b.) Jim: “I really don’t know, just get their stuff”.
c.) Jim grabs three old photo albums of his own and throws them in the Prius. That was it for Jim stuff.

Wild times.

The fire’s path is shown on this KCRA video: The fire ran right to the back fence of we had listed for sale in 2006. We’ve checked with that family, and the house survived (smoke issues of course).

As I write these quick tips, my wife Jenny is collecting clothing for the families who were burned out.

IF YOU WOULD LIKE TO DONATE, CALL ME AT 916.801.3940 and I will pick up your donations in my truck… now with a working battery.


Aug 27, 2009

California Association of Realtors Offers Job Loss Insurance

Hello Neighbors,

This is very cool.

At a time when employment is challenging - yet buying a home is absolutely the right thing to do (and timing couldn't be better), CAR is offering "First Time Buyer Insurance". I love it.

Take a look:

C.A.R.'s Housing Affordability Fund (C.A.R.H.A.F) has committed $1 million to support the Mortgage Protection Program - and the National Association of REALTOR another $420,000 - an insurance product that kicks in when the unexpected happens: job loss.

Your first-time buyers who enroll in the program can draw upon their mortgage protection policy in the event they lose their job after purchasing their home. Under the program, first-time buyers will be eligible to receive $1,500 per month for six months in the event of a job loss; co-buyers are eligible to receive $750 per month.

To be eligible for coverage, the home must be a principle resident in California and a first-time buyer is defined as someone who has not purchased a home in the past three years. While there are no caps on the applicant's income or the purchase prices of the home, the applicants are required to use a California REALTOR in their transaction; they cannot be self-employed or older than the age of 70. Consumers can apply for the program via their REALTOR.

It's new - so we haven't tried executing on the program yet... but if you want it, call me! We'll figure it out together!

Putting 2009 in the rear view mirror... Neighborly!

- Jim

Aug 26, 2009

Short Sale Process Help for Realtors

Hello Neighbors,

More evidence that sanity is returning to Real Estate!

Freddie Mac has thrown its weight behind helping us in the industry.

Thank you NAR (National Association of Realtors) for posting this update.

Short Sale transactions are the hardest escrow to conclude. Even when we have a Willing buyer, and a willing Seller - the Seller's lender will do a variety of evil things to kill the process. Only 25% of escrows on Short Sales are actually making it to COE (Close of Escrow). The other 75%? Who knows. Default (foreclosure), Loan Modification, or the Seller "catching up" are the other likely outcomes.

One of our least favorite actions is when the Short Sale lender comes after our wages. We can get through the entire negotiation process, inspection period, escrow .... and then have the lender say "by the way, we are cutting your commissions to ZERO". Yep. Working for free. Or - more realistically, since we've invested a great deal of time, energy, and our own funds - we are working for a loss. Now factor in that the majority of the houses on the market are short sales. Do the math, earnings risk is pretty high concern in this profession.

Why does this Freddie Mac news help?

We can now work with less fear of "Short Sale Earnings Theft". More confidence when showing Short Sale homes to Buyers. More faith that we can operate a business as a business - not as a collections agency.

We have more assurance that the industry is recovering, and some level of logic is returning to the key principles who drive this market. Stability is around the corner!

Freddie Mac Issues Written Short Sales Commission Policy

On August 20, 2009, Freddie Mac confirmed in writing that its servicers are not allowed to renegotiate short sales commissions. According to the policy, as a condition of the servicer’s acceptance of a short sale offer, servicers cannot renegotiate the sales commission below the amount agreed to by the real estate broker and the seller/borrower. However, if the negotiated commission exceeds 6 percent, servicers are required to limit it to 6 percent. This Freddie policy is consistent with Fannie Mae’s policy.

NAR has asked Freddie to establish an appeals process for cases when servicers refuse to comply with Freddie Mac’s policy.

Links to more in depth information can be found here:

Freddie Mac Single-Family Seller/Servicer Guide Bulletin 2009-22 (August 20, 2009)

Fannie Mae Short Sales Commissions Policy and Appeals Process

NAR’s Short Sales Website

Just another sign that logic is returning (if slowly).

- Jim

Wooo Whooo !! - Home Sales Up and Steady

Hello Neighbors,

The recovery is upon us!

(Note to self though - the rumored zillions of foreclosures still to hit the market could drive things down again... but when will those homes hit the market? I've been told "next month" for 11 months now...)

Thank you NAR (National Association of Realtors) for the updates posted below!

STRONG Gain in Existing-Home Sales Maintains Uptrend

Washington, August 21, 2009

For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate1 of 5.24 million units in July from a level of 4.89 million in June, and are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.
Lawrence Yun, NAR chief economist, said he is encouraged. “The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales,” he said.

The monthly sales gain was the largest on record for the total existing-home sales series dating back to 1999.

“Because price-to-income ratios have fallen below historical trends, there are more all-cash offers. In some recovering markets like San Diego, Las Vegas, Phoenix, and Orlando, the demand for foreclosed and lower priced homes has spiked, and a lack of inventory is becoming a common complaint,” Yun said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.22 percent in July from 5.42 percent in June; the rate was 6.43 percent in July 2008.

An NAR practitioner survey showed first-time buyers purchased 30 percent of homes in July, and that distressed homes accounted for 31 percent of transactions.
NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said the first-time buyer tax credit is working. “In addition to first-time buyers, we’re also seeing increased activity by repeat buyers. While many entry-level buyers are focused on the discounted prices of distressed homes, they’re also freeing some existing owners to sell and make a move,” he said.

“Realtors® are the best resource for consumers in these changing market conditions because the transaction process has become more complex. Since it’s now taking longer to complete a home sale, first-time buyers who want to take advantage of the $8,000 tax credit should try to make contract offers by the end of September,” McMillan said. “Otherwise, they may miss the November 30 closing deadline.”

Total housing inventory at the end of July rose 7.3 percent to 4.09 million existing homes available for sale, which represents a 9.4-month supply2 at the current sales pace, which was unchanged from June because of the strong sales gain. Raw inventory totals are 10.6 percent lower than a year ago when the number of unsold homes was at a record.

The national median existing-home price3 for all housing types was $178,400 in July, which is 15.1 percent lower than July 2008. Distressed properties continue to weigh down the median price because they typically sell for 15 to 20 percent less than traditional homes.

Single-family home sales increased 6.5 percent to a seasonally adjusted annual rate of 4.61 million in July from a pace of 4.33 million in June, and are 5.0 percent higher than the 4.39 million-unit level in July 2008. The median existing single-family home price was $178,300 in July, which is 14.6 percent below a year ago.
Existing condominium and co-op sales jumped 12.5 percent to a seasonally adjusted annual rate of 630,000 units in July from 560,000 in June, and are 5.9 percent above the 595,000-unit level a year ago. The median existing condo price4 was $178,800 in July, down 18.9 percent from July 2008.

Regionally, existing-home sales in the Northeast surged 13.4 percent to an annual pace of 930,000 in July, and are 3.3 percent higher than July 2008. The median price in the Northeast was $236,700, down 15.0 percent from a year ago.

Existing-home sales in the Midwest jumped 10.9 percent in July to a level of 1.22 million and are 8.0 percent above a year ago. The median price in the Midwest was $157,200, which is 5.9 percent less than July 2008.

In the South, existing-home sales rose 7.1 percent to an annual pace of 1.95 million in July and are 5.4 percent higher than July 2008. The median price in the South was $164,500, down 7.1 percent from a year ago.

Existing-home sales in the West slipped 1.7 percent to an annual rate of 1.13 million in July, but are 1.8 percent above a year ago. The median price in the West was $202,300, which is 28.0 percent below July 2008.

Buyers, we are getting close to the "now or never" point.

- Jim

Aug 21, 2009

Folsom Treehouse Update (Out of Bankruptcy)

Hello Neighbors,

Another sign that things are stabilizing a bit. You've heard about this in the local news... some of the larger foreclosures / failures are getting bought up, like the Folsom Treehouse project.

This just in from the Sac Business Journal - thank you SBJ!

Folsom Project Bought out of Foreclosure

Aug 17, 2009 - The Sacramento Business Journal

A real estate investment firm said Monday it has acquired a 25-acre residential development in Folsom through foreclosure proceedings and plans to develop the property with new homes.

PCCP LLC, which has an office in Sacramento, will resume construction at the Folsom Treehouse master-planned community, located at Prairie City and Iron Point roads, in a partnership with Signature Properties. The company acquired the project last week. The property had been in possession of the Federal Deposit Insurance Corp. and United Commercial Bank, after the original loan of $22.5 million went into default last year. PCCP acquired a discounted note from the FDIC and United Commercial in March.

The development is made up of 291 finished lots, with 99 single-family lots, 164 condominium lots and 28 constructed or partially constructed homes.
The terms of the acquisition were not disclosed.

Company vice president Jim Galovan said PCCP, which focuses on recapitalizing distressed real estate, has targeted Folsom for investment in the past due to its strong job base anchored by the 7,000-employee Intel campus. The area currently has a low inventory of new homes, he said.

- Jim

Aug 18, 2009

HUD Homes, We Got 'em !!

Hello Neighbors!

It is with great enthusiasm that we announce our affiliation with HUD! After pushing for 11 months with their subcontractor, we now have keys! Yep, we can get into any HUD home in California, help you write offers ("Bids" in the HUD world), and get you into one of these homes.

What is a HUD Home?

A HUD Home is a single family home or other type of residence that is backed by the Federal Housing Administration / FHA (through "Mortgage Insurance" aka "MIP") and is now in foreclosure. Once a home backed by the FHA goes into foreclosure, it is deeded back to HUD by the lending mortgage company. This is how HUD "forecloses" on Mortgage Insurance when the Buyer defaults.

Why is this Important?

1) It's not rocket science. As more home owners default, the amount of "inventory" HUD will take back will grow.

2) HUD doesn't use the same MLS lockbox system that 99% of the homes for sale use. They have keys to the locks on the doors, that they issue to HUD approved Real Estate companies. A regular Realtor can't get in with a lockbox to a HUD home - they need the keys! We've Got Them !!

3) The purchase offer process is different with HUD homes. They don't use the normal contracts that we use for most transactions in California. They use their own on-line systems to make offers (bids) and to let the Buyers know where they stand. Real Estate companies can't submit offers on HUD homes unless they've been pre-approved by HUD and issued a special code (called a "NAID" number". We've got a NAID number and are ready to go!

Next steps?

Take a look at the items to the right. You will see a section on HUD Homes. You can review inventory (see what is on the market).

Call us and we can help you with a HUD home!

- Jim

Aug 10, 2009

Become a Fan in Facebook !!

Hello Neighbors,

Join us in Facebook!

Become a Fan of Neighborly Realty & Neighborly Financial today! We just added this within the last few minutes, so please excuse the lack of fans as we create this blog entry. We'll do better soon!

Why Facebook?

It is a wonderful way to get real time information out quickly - specifically to those who want it, without intruding on your email!

Thanks Neighbors - and now fans!

- Jim

Aug 7, 2009

Are Appraisals Useless?

It sure looks that way.

Hello Neighbors,

It happened again yesterday. An appraisal came in on a great Granite Bay home (we are in escrow on) at roughly $46,000 below purchase price. Yep, that’s right. A HUGE gap between what we’ve agreed to pay and what the bank’s appraisers say it is worth.

Unfortunately, this is to be expected – but it sure makes this process difficult, and can really challenge the buyer / borrower confidence.

For me, it started in 2006. We had an appraisal come in at $6,000 below the agreed upon purchase price.

Since then, the appraisals have been close to worthless.

Remember – we do loans too. Every purchase loan or re-fi loan requires an appraisal. In the last year, we’ve had two different transactions that required 4 appraisals each !! Why? To account for appraiser fear and appraiser incompetence. Multiply 4 by the average appraisal price of $350 - $490 and you can see how hard this is on the buyers and borrowers. It’s awful.

Why is it happening?

1) Appraisers are afraid. Collusion between some appraisers and some lenders was the first step to this downturn, as far back as 2005 – 2006. So? Appraisers got scared and started getting overly conservative in their valuations. Of course, since the markets have continued to decline – the conservative nature of appraisers has only increased.

2) Appraisers aren’t able to talk to anyone relevant! As of May 1st 2009, appraisers aren’t allowed to discuss values directly with the parties involved in the transaction. That’s right – they go in blind without much data or insight on the specific property. It’s now illegal for us to talk to them. We do a ton of work making sure an offer is at the right market value – but aren’t allowed to discuss this research with the appraiser! Insane. Google this one – “HVCC legislation”. It will explain how the appraisal rules have changed, and the creation of these new “Appraisal Management Companies” (AMC’s).

3) Appraisers aren’t familiar with the area they are appraising. This one is the worst. Lenders used to be able to pick the appraisers they used. Not anymore. Obviously, lenders would choose local appraisers who knew the neighborhoods and areas well. Now? The appraiser may not even be from the same County in California! The example I gave of our $46,000 gap yesterday? The appraiser was from El Dorado Hills – that’s a County away from the property in question in Placer County’s Granite Bay. The appraiser used comps that were 50 years old, backed to Auburn-Folsom road, and sat under major power lines… with no adjustments. She was not at the slightest familiar with the different Granite Bay neighborhoods and nuances.

Also yesterday - I was sitting with 80 or 90 mortgage brokers at the monthly Sacramento Association of Realtors finance session. One lender shared a scary story…. Two appraisers from San Diego were flying up here to appraise 15 houses – during a 1 day trip. All for a bank. The appraisers were earning $150 per house. Wow. Out of the area appraisers, working for below market wages, and spending a few minutes per home. What does that tell you about this process?

In summary? Appraisals are very near worthless.

What is important is making sure you have confidence in the agent representing you, and making sure that person is doing a very thorough job of reviewing home values.

Want to talk more about appraisals, give me a call.

- Jim

Aug 3, 2009

Be Prepared - 45 Day and 60 Day Escrows

Hello Neighbors,

As we continue to recover from these crazy times, the Feds are creating new legislation at an alarming rate. These new rules are rolling out a bit too quickly - and without a thorough analysis of the impact to the consumer.

Don't get me wrong - the goals are important, and the steps needed. We simply need to know how to manage in these new environments.

One immediate impact, probably 45 day purchase escrows. 60 days are even on the horizon.

These changes impact purchase loans AND re-finance loans.


The two most important changes were rolled out on May 1st and early in July.

The first is called the "HVCC" or Home Valuation Code of Conduct. It dictates how people in these industries work with Appraisers. In short, we can't talk to them!

The second is a change to the Truth-In-Lending laws. These laws force new disclosures to borrowers if there is a change of 1/8th of a point in APR. ...and a 3 day "hold" period for the analysis of that new disclosure.

What does this last item mean?

Let's say interest rates change between your lock and your close of escrow. NOTE THAT THEY ALWAYS WILL since rates are based on the daily US bond markets!! You could end up reviewing and reviewing changes and changes for days.

More review, more 3 day wait periods = longer escrows. Please plan accordingly!

- NeighborlyJim

Where is the Bottom ?? How About HERE !!

Hello Neighbors,

My sincere apologies for the gap! It's been 4 weeks since a "fresh" blog post... lots going on in these crazy markets. So many changes with lenders (new Appraisal rules, new Truth-in-Lending rules, a pipeline so full that we are seeing 45 and 60 day escrows..)

It's just plain nutty right now.

But it does feel like we are at the bottom, and the Associated Press just put out this fine (and long) article on just that topic. Take a read below.

From a practical standpoint - we are still offering like crazy for Buyers at entry level price points (roughly below $200,000). Most of that inventory is now Short Sales. We've seen a drop in REOs (foreclosures).

Happily - we are starting to see "private party sales" again! That's the regular old sale we are all used to. Family to family. No extra banks or lenders involved. It's like 2005 and earlier...

Here's the AP article.

- NeighborlyJim

From our friends at the Associated Press - thanks AP for the great content and the good data points !!

Welcome to the bottom: Housing begins slow rebound

By ADRIAN SAINZ, DAVID TWIDDY, DANIEL WAGNER, ALEX VEIGA, Associated Press Writers Adrian Sainz, David Twiddy, Daniel Wagner, Alex Veiga, Associated Press Writers – Sun Aug 2, 5:26 am ET

It was — note the past tense — the worst housing recession anyone but survivors of the Great Depression can remember.

From the frenzied peak of the real estate boom in 2005-2006 to the recession's trough earlier this year, home resales fell 38 percent and sales of new homes tumbled 76 percent. Construction of homes and apartments skidded 79 percent. And for the first time in more than four decades of record keeping, home prices posted consecutive annual declines.

A staggering $4 trillion in home equity was wiped out, and millions of Americans lost their homes through foreclosure.

Now take a deep breath and exhale. The worst is over.

By every measure, except foreclosures, the housing market has stabilized and many areas are recovering, according to a spate of data released in the past two weeks. Nationwide, home resales in June are up 9 percent from January, on a seasonally adjusted basis. Sales of new homes have climbed 17 percent during the same period. And construction, while still anemic, has risen almost 20 percent since the beginning of the year.

Even home prices, down one third from the top, edged up in May, the first monthly increase since June 2006.

"The freefall is over," says Dean Baker of the Center for Economic and Policy Research.

The problem is that, Baker, like many economists, expects the housing market will "be bouncing around the bottom" for the second half of the year.

There are also real threats that could poison this budding recovery. The unemployment rate, which is 9.5 percent, is expected to surpass 10 percent, leaving even more homeowners unable to pay their mortgages. Mortgage rates could rise, making homeownership less affordable. And the federal tax credit for first-time homebuyers, which as lured many into the market, is set to expire on Nov. 30.

"As long as jobs are being lost, regardless of all the federal programs out there to help the borrowers, you're still going to have problems in the housing market," says Steve Cumbie, executive director of the Center for Real Estate Development at the University of North Carolina's Kenan-Flagler Business School.

True, but when you've got bidding wars for foreclosures in places like Las Vegas, Phoenix and Los Angeles, it's time to call the bottom.


For years Las Vegas symbolized the boom, as mile after mile of desert gave way to three-bedroom homes and swimming pools. Then came the crash and it symbolized something else: a decade of speculation and excess.

Now, Las Vegas is one of the hottest housing markets in the region again. This city has always profited from others' misfortune, and the same can be said of the current housing market.

In Clark County, Nev., home to Sin City, one in every 11 homes had received at least one foreclosure-related notice in June, according to RealtyTrac. The glut of deeply discounted foreclosures has almost doubled sales activity for most of this year.

"In January the market was busy, and since that time, it's gone a little haywire," says Brad Snyder, an agent with ZipRealty in Las Vegas. "There's (sales) activity now that we haven't seen even since '04."

The situation is similar in California's Riverside, San Joaquin and San Bernardino counties, where one out of every 14 homes was in foreclosure.

After falling 18 percent in the second half of 2008, monthly home prices were flat in the first half of this year, on a seasonally adjusted basis, according to the National Association of Realtors.

Markets like these have seen a surge this year in all-cash buyers, many of them investors, scooping up the sharply discounted properties. It's not uncommon to see multiple offers on a single property, and that's helped slow the rate of price declines a little. The demand also has helped whittle down the inventory of homes for sale to the lowest level since the boom.

"We have seen such a steep decline in supply right now, that when a home comes on the market it's first day there could be seven or eight or 10 people there in a matter of hours," Snyder says.

To lure buyers away from foreclosures, homebuilders have slashed prices or are simply tearing down vacant homes. New home sales jumped almost 59 percent in the first half of the year, while construction in these grossly overbuilt markets slid 12 percent.

In the Pacific Northwest and states such as Utah, by contrast, housing markets are on a different timer than the rest of the West. Home sales and values held up better and longer while markets in the Southwest were already in decline. These markets also haven't seen as many foreclosures wreaking havoc with home prices.

States in the region: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming

Data compares June vs. January and June 2008:

Home resales: down 1 percent, up 12 percent

Median price: $214,800, flat, down 25 percent

New home sales: up 59 percent, down 10 percent

New home construction: down 12 percent, down 42 percent

Mortgage delinquencies as of March: 12 percent

Regional outlook: The recession remains the region's wild card. Unemployment is at 10.2 percent in the West, but that could go higher if the economy worsens. If that happens, expect more foreclosures and a slower turnaround

Jul 2, 2009

Re-Finance Rule Changes – From 105%: Now up to 125% of Home Value !!

Hello Neighbors!

GREAT NEWS from our friends at CNN and CNNMoney! Thanks CNN Teams!

Government driven changes to the home financing markets continue to roll out, and we couldn’t be happier. Home owners can now refinance up to 125% of their home values. Fantastic news for owners underwater due to the huge market shifts we’ve seen since 2006.

Don’t let these rates pass you buy. Although they are no longer in the 4%s, we are still getting great rates in the 5%s. Those of you with adjustable or very bad 2nds can now take advantage of locking into the new lower rates even if we couldn’t help you just a month ago!

If you need help with a re-fi, CALL! You can start with Jim at 916.801.3940.

The full article from CNN is below:

NEW YORK ( -- The Obama administration is widening its mortgage refinancing program to allow more borrowers hit hard by falling home prices to take part.

Borrowers whose loans are now worth up to 125% of their home's value are now eligible to refinance their homes under the Obama foreclosure prevention plan announced in February. Previously, the limit was 105%.

"The president's Making Home Affordable plan is already helping far more than any previous foreclosure initiative and with today's announcement we will extend its reach still further," said Donovan.

How many more people will be drawn to the program now, however, remains a question, especially since mortgage rates are on the rise. Administration officials do not have an estimate.

Refinancings Slow to Ramp Up (don't be one of these owners and miss the opportunity!)

Some 20,000 loans have been refinanced so far, according to the Treasury Department.
The initiative waives the requirement that homeowners have at least 20% equity in their home, allowing them to take advantage of today's lower rates. Homeowners must still meet other criteria, including being current on their payments and having loans that are owned or backed by Fannie Mae or Freddie Mac. The administration has set up a Web site,, with more information.

Wednesday's expansion means those with homes worth $200,000 and mortgages as large as $250,000 can still qualify. Previously, these borrowers could not have loans exceeding $210,000.

The program, however, has been slow to ramp up. Borrowers have complained that banks are not approving their applications. The Mortgage Bankers Association last week slashed its 2009 forecast of originations because fewer refinancings were being done than they originally expected. The group said only 13,000 were done in the three months after the plan's launch

The administration has projected that 4 million to 5 million mortgage borrowers would be helped. A Treasury official Tuesday said that the figure applied to those who would be eligible, not necessarily those who would participate.

Administration officials do not have an updated figure of how many people would be eligible or participate now that the criteria has been widened.

The recent uptick in mortgage prices has blunted the plan's benefit, as well. The Federal Reserve has been buying mortgage-backed securities and long-term Treasurys in an effort to lower rates.

It worked for a while. Rates hit a low of 4.84% on April 28, but are now at 5.45%, according to HSH Associates.

Since mortgage rates have been in the 6% range in recent years, refinancing to the mid-5% range may not be worth it, said Keith Gumbinger, vice president at HSH Associates. A homeowner with a $200,000 mortgage at 6% would see a savings of about $64 a month if he refinanced at 5.5%, and that's before closing costs.
"Are interest rates low enough to warrant getting into the process?" he said.
The administration's announcement comes on the same day as an industry group reported that the demand for refinancing dropped 30% last week. In addition to higher rates, rising unemployment is contributing to the decline.

Borrowers with Freddie Mac loans who refinance through their current servicer can apply right away, but those who want to go through a different lender must wait until Oct. 1. Those with Fannie Mae mortgages must use their current lenders and wait until Sept. 1.

A second part of the program lets eligible borrowers who are in default -- or at risk -- lower their monthly payments to no more than 31% of their pre-tax income. This can help those who are not making as much at their jobs or who have monthly payments they can't handle. Homeowners, servicers and mortgage investors can receive incentives to entice them to participate in the program.

Banks have extended more than 200,000 trial modification offers, according to the Treasury Department. Homeowners must make three monthly payments on time before the modification is made permanent.

Call to start the re-fi process now!

- Jim

Jun 29, 2009

How Quick Can We Sell? How About 3 Offers in 10 Hours?

Hello Neighbors,


You use this site to keep up on the latest market activities. No spin, just good solid data.

Here is an example of how insane the markets are right now, from one of our own listings (in Marysville, CA).

We listed a house in Marysville for $79,800 at 11:00pm on Saturday the 20th. Within 10 hours, we had 3 written offers. We had more verbally promised offers, but those don't count (unless we see it in writing, it doesn’t exist).

Amazing market conditions if you are selling - and IF you are at the right price point.

Before going into escrow (roughly 7 days after listing) we had 13 very solid offers. Some were all cash. Most were above list price. 13 written offers.


Competition in the entry-level housing markets is incredible. Foreclosures continue to dry up. Short Sales continue to take forever - although some lenders are getting better.

Now What?

If you are a family and need to sell - we can get it done for you, and quickly AS LONG AS YOU PRICE ACCORDINGLY and you are in the "entry-level" price points. If you are at the very top of the high end market segments... we may not be able to sell. Those purchase dollars are still missing in action. Sorry Jan and Dave!

Wild times indeed.

- Jim

Jun 15, 2009

Join Us in Insider Pages!

Hello Neighbors,

If you need a hand, this site will show you a map of our main office.

Read reviews of Neighborly Realty on Insider Pages!

Read reviews of Neighborly Financial on Insider Pages!


- Jim

New Foreclosure Laws Take Effect in California Today

Hello Neighbors,

The real estate market continues to shift, with the help of legislation.

This just in from our friends at the Sac Bee (thank you Sacramento Bee)!

Foreclosure rates are going to continue to be low. GREAT for the homeowner! TOUGH for the first time Buyer who is still trying to get their hands on a bank owned property.

We have seen this in action on a daily basis. Here is today's example: I called on a listing today for a client on an Orangevale house that is on a probate sale. List price is $159,000. Surprisingly, the listing agent called me back! In MLS it says “no showings until June 16th” I called to get the OK to show tomorrow, and she told me she had 4 offers already – all above list price, sight unseen. WOW. But expected. That's the way the market is running right for first time Buyers. The competition is tough. It requires "clean offers" and QUICK action if you want to be a part.

Here's the article from the Sac Bee:

By Jim Wasserman
Published: Saturday, Jun. 13, 2009 - 12:00 am | Page 6B

After a severe economic storm of more than 365,000 California foreclosures since early 2007, the state's long-awaited 90-day foreclosure moratorium law goes into effect Monday.

But it doesn't mean foreclosures will stop.

Supporters acknowledge the state is likely to see thousands more foreclosures before the crisis subsides. The law, indeed, goes into effect as lenders are ramping up repossessions following expiration of earlier moratoriums, according to housing trackers.

But the California Foreclosure Prevention Act, passed as Assembly Bill X2 7 by lawmakers in February and signed by Gov. Arnold Schwarzenegger, raises a new hurdle in the foreclosure process.

Backers say it will make lenders try harder to keep borrowers in homes. Starting Monday, loan servicers must prove to the state they have comprehensive loan modification programs in place – or be denied rights to foreclose on their own schedules.

"You have voluntary programs that they don't have to do," said Assemblyman Ted Lieu, a Torrance Democrat who was the author of the bill. "This creates an enforcement mechanism to force them to do it. The hammer is the 90-day foreclosure moratorium, which they all hate."

The law will largely press lenders to follow the Obama administration's Making Home Affordable Program that began in March. That encourages lenders to cut interest rates or rewrite loans to 40-year terms to get payments below 38 percent of a borrower's monthly income. Other options include reducing principal and tacking missed payments to the back of the loan. Under the law, California officials also can encourage short sales or deeds in lieu – options in which banks accept less than owed – for borrowers who want to leave or don't qualify for modifications.
"The vast majority of large servicers should have no trouble complying. They have already complied with similar requirements at the federal level," said Dustin Hobbs, spokesman for the California Mortgage Bankers Association.

As the nation's first statewide moratorium law of its kind, according to Lieu, hopes are it will "slow down the rate of foreclosures."

"For some people there's not much that can be done," said the lawmaker. "But there are a fair number of people on the bubble … if they can get some assistance, they can stay in their home."

California Department of Corporations spokesman Mark Leyes said the state can't force or guarantee loan modifications. But the law is rooted in another state power that gives it leverage with lenders.

"What we do have control over is the legal process by which foreclosure is executed in this state," he said. Hence, adding 90 days to the process for those that don't comply.

Lieu said, "Not all banks are doing it at the same level. Some have good (modification efforts), some have bad ones and some have none."

Lenders have received widespread criticism for being overwhelmed by the foreclosure crisis and slow to rewrite loans despite receiving billions of dollars in federal assistance. Borrowers and nonprofit loan counseling agencies alike have complained of frustrating delays and snafus in the process.

On the front lines of the crisis it's easy to be wary about yet another new law or program.

"We're hopeful it will help, but in reality, time after time these things come out and the results are the same," said Pam Canada, executive director of the nonprofit counseling firm NeighborWorks Homeownership Center of Sacramento.

The new law represents a third evolution of California's response to a housing crisis that has severely damaged the economy and devastated local and state government budgets. In late 2007, Schwarzenegger entered into a voluntary agreement with subprime lenders to modify more loans.

Last summer, he signed Senate Bill 1137, which temporarily slowed banks' foreclosure machinery, making them work harder to contact borrowers and offer alternatives.
But foreclosures, while down in recent months, have continued in hard-hit California, especially in the capital region.

The region suffered almost 4,000 new foreclosures in January, February and March, and another 12,000 households are well behind on payments, according to Bay Area tracker ForeclosureRadar.

In summary, here's what will happen starting Monday:

• Lenders will submit applications to the state outlining their loan modification programs. That gives them a 30-day exemption from a moratorium.

• If the state OKs a lender's program, the firm is permanently exempt from the 90-day delay on foreclosures.

• If the state rejects the program as inadequate, a lender has 30 days to upgrade it and be reconsidered.

Leyes said consumers will be able to see a list of lenders that comply with the state's requirements by mid-July.

Thanks Neighbors (and Sac Bee),

- Jim

Scratch Location, Location, Location - it's now PRICE, PRICE, PRICE

Hello Neighbors,

Interesting times.

Houses below the $250,000 price point are absolutely "flying off the shelves".

Property above the $600,000 price point? As "stale" as can be. Those properties are moving at a very, very slow pace. Often times sitting on the market for over a full year.


We see it every day – offering on homes below the $250,000 price point for several of our families – you MUST take immediate action to compete. We are now offering on homes – sight unseen – within a day or two of the home hitting the market. …and our completion? Doing EXACTLY the same thing. A properly priced home will have a dozen offers on it during the first few days on the market. It’s challenging, but it can be done. Of course, if your offer is complicated – and it is competing against “clean” offers – than you will lose. Do everything you can to structure a clean offer and you will have a shot at getting in a home now.

To validate what we are seeing, we looked to the NAR (National Association of Realtors) economics team for some insight. Take a look (and thank you NAR for the data!)

Record low mortgage interest rates boosted pending home sales for the third consecutive month, with some benefit now from the first-time buyer tax credit, according to the National Association of Realtors®.

The Pending Home Sales Index,1 a forward-looking indicator based on contracts signed in April, rose 6.7 percent to 90.3 from a reading of 84.6 in March, and is 3.2 percent above April 2008 when it was 87.5.

Lawrence Yun, NAR chief economist, said buyers are responding to very favorable market conditions. “Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” he said. “Since first-time buyers must finalize their purchase by November 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers.”

The Pending Home Sales Index in the Northeast shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago. In the Midwest the index rose 9.8 percent to 90.4 and is 11.1 percent above April 2008. The index in the South slipped 0.2 percent to 93.0 in April but is 3.5 percent higher than a year ago. In the West the index rose 1.8 percent to 94.8 but is 2.9 percent below April 2008.

NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said there are numerous buyer assistance programs around the country. “Some states are offering bridge loans that allow first-time buyers to use the tax credit for downpayment and closing costs, but there are many other local government and nonprofit programs available to buyers, depending on location,” he said.

“Just last week, HUD announced that qualifying buyers can use the tax credit for closing costs on FHA loans, to buy down the interest rate or make a larger downpayment. Buyers who are wondering about their options should contact a Realtor®, who can advise consumers on the housing assistance programs and resources available in a given area.”

NAR’s Housing Affordability Index2 is in record territory. The affordability index rose to 174.8 in April from an upwardly revised 171.9 in March, and was the second highest monthly reading on record after peaking at 176.9 in January of this year. The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates and family income; tracking began in 1970.

A median-income family, earning $60,900, could afford a home costing $296,800 in April with a 20 percent downpayment, assuming 25 percent of gross income is devoted to mortgage principal and interest. Affordability conditions for first-time buyers with the same income and small downpayments are roughly 80 percent of that amount. The affordable price was well above the median existing single-family home price in April, which was $169,800.

Yun cautions that the reporting sample for pending home sales is smaller than that of existing-home sales, so it is subject to greater variability. “In addition, the relationship between contracts on pending home sales and closings on existing-home sales is taking longer than in the past for several reasons,” he said. “Mortgage processing time has increased, it is taking many months to close on those homes requiring short sales with lender approval, and some sales are falling through at the last moment.”

The total number of existing-home sales is expected to improve but with dramatic local market variation in the timing of recovery. “The market has already bottomed in some areas, but this is an unusual housing cycle with some areas improving rapidly while others languish or decline,” Yun said.


First time buyers are ruling the marketplace.

Some don’t even care where the home is – they just want to get into something soon before interest rates change too much, or the market takes off again.

Location, Location, Location? While still very important – it seems that “PRICE, PRICE, PRICE” is absolutely ruling the day.

- Jim

Jun 12, 2009

Are Low Mortgage Rates Gone for Good ??

Hello Neighbors,

This article from John Graham, the Neighborly Financial manager:

In light of the recent run-up in mortgage rates, one has to ask if the low rates are gone for good. After all it was hard to imagine rates being at 4.75% for a 30 year fixed loan. At this time, I think these rates are gone. Why? Well, everyone is now seeing the light at the end of the tunnel for the recession. Stocks are up over 25% from the March '09 lows, with confidence growing. People are selling bonds with relatively low yields - moving to higher yielding stocks. As people sell bonds, the interest rates move up.

Add to this all the federal spending that will be pushed into the economy in the coming months. Money that will generally not hit the economy till it's too late. Think of it as giving stimulants to a hyperactive person - not a good outcome....

This is the outcome everyone is worrying about now. How do we keep the economy from getting out of control on the other side - with runaway inflation the primary fear. The main weapon in controlling a runaway economy is interest rates on various financial instruments.

As people sell bonds, and the fed is deciding how high and how fast to raise rates, mortgage rates are the first to suffer. After all the fed had a program to buy mortgage backed securities, to artificially drive these down. Now in light of the changing economic times, they are backing away from this program in the first step to let rates rise.

So.... what does this mean to the average borrower? Get ready for higher rates. If you have not refinanced, and if it makes sense, do it now! Remember, any rate below 6% is still a good rate.

see us at

- Jim

Jun 11, 2009

Activerain - GREAT Insight for all Real Estate & Loan Needs

Hello Neighbors,

Are you familiar with "Activerain"?

It's a professional networking tool for Real Estate professionals.

It is also A GREAT source of information for the consumer - real estate or financing.

If you would like to check it out, give it a shot:

Jim Harris (Neighborly Realty & Neighborly Financial): Real Estate Agent in Rocklin, CA

It's very much like a "LinkedIn" (networking tool for all professional disciplines). A bit like "Facebook" (networking tool for connecting with friends and family).

Good information, updates on market conditions, insight on financing and selling, and access to several hundred thousand real estate professionals around the world.


- Jim

Jun 10, 2009

Neighborly is Twitter-ing (Tweeting) !

Hello Neighbors,

Join us in Twitter now too!

You've been hearing the buzz for months now. We've taken the leap.

Here you go:


Another way to keep our neighbors informed.

Enjoy, and happy Twitting, Tweetering, Tweeting,

- Jim

Jun 6, 2009

Newest Neighborly Team Member

Hello Neighbors,

It is with great excitement that we announce the newest addition to the Neighborly Realty team roster: Holden Nicole Harris. Born June 4th, 2009. 9 pounds 6 ounces. 21.25 inches long. 10 fingers, 10 toes. Outstanding.

- Jim

Jun 3, 2009

Loan Modifications - Are They Right for Your Family?

Hello Neighbors,

Is a Loan Modification the right answer for your family?

We've made a new web site available at to help you answer that question.

If you would like, you can also call our toll free 24x7 information line at 1-800-960-0860 and enter extension 1611 and listen to a recorded message.

Many thanks, and let us know how we can help.

- Jim