Tuesday, March 11, 2008

Sacramento Regional Real Estate Trends for March 8, 2008

The rest of the stats will return next week once I finish retooling.


9 comments :

Sippn said...

OK somebody's hiding all the homes....

Kind of wierd isn't it?

MAybe the banks (CFC, Wells, etc) finally figured out that their trashing their own pocket books when they overload the market.

Meter it out slowly and many others will benefit.

Oh, and can you heat the damm REOs too? Maybe water so the toilets can be flushed?

I heard a good one today, that sellers (banks) are having a hard time getting utilities turned on in time to demonstrate viability of the home before the contingency period expires.... watch those REOs folks, the contracts are NOT as nice as a standard real estate contract.

AgentBubble said...

I second sippn's comments about dealing with REOs. Those addendums they add are ruthless. Be VERY sure you know what you are getting yourself into.

Ed said...

Could someone host some example language, for us uber-nerd readers?

Max said...

MAybe the banks (CFC, Wells, etc) finally figured out that their trashing their own pocket books when they overload the market.

Well, we all know that there's a huge diminishing returns factor playing against them. Even if prices hold and thieves/vandals stay away, they're still looking at maintenance and taxes. Multiplied by hundreds (or thousands) of houses, and you figure they'll have to stop the bleeding sooner or later.

One agent couple friend of mine got approached by a bank to handle a portfolio of 500 REOs. They turned it down. Apparently when the news media shows up at an unmaintained neighborhood eyesore of an REO, it's not good for business if your name is on the sign. :)

Gwynster said...

500? Pleaseeeeeee let them be in Yolo county >; )

smf said...

"Multiplied by hundreds (or thousands) of houses"

I recall not long ago that we did a small change in an apartment complex. What was a difference of a few hundreds per unit turned into significant savings for the builder.

AB, thanks for your help! If you have any other ideas, let us know.

(Just so you all know, my wife, an statistics major from UC Davis, had the same idea as AB regarding a little housing situation we have. It is a compliment to AB)

Sippn said...

Talking to an agent looking for a home for her daughter in SoCal today.

Said, one listing agent there has 400-500 REOs and a staff of 20+. She has waited over 2 months for an answer and only gets to deal with the receptionist.

Nice, these lenders have really stepped up the professionalism. One job lender REO management listing I saw paid comparable to a Barista...

Believe me, keeping the home maintained, heated, etc costs less than the discount associated with not. They bring down the value of the whole neighborhood more (x # homes in neighborhood)

Do you notice that even used car dealers wash their cars everyday?

Max said...

Believe me, keeping the home maintained, heated, etc costs less than the discount associated with not.

I was coming at it from the bank's perspective. Purely for entertainment purposes:

For a typical REO assessed at $300K built in 2003 or later, you're looking at $310/month for property tax, ~$100/month in melo-roos, $50/month for yard work, and another $50 for water-sewer-garbage. CFC has roughly 4200 REOs listed for sale in CA on their site. At $500/month/unit, that's $2.1 million dollars a month going out the door. Just in California.

If we take that out to their nationwide REO portfolio of 15,500, we're up to $7.75 million/month, or $93 million/year. That's 3.7% of their 2006 profit.

Do you notice that even used car dealers wash their cars everyday?

Yeah, now that all the "high paying" construction jobs are gone, $2/car seems like a sweet gig. ;)

Sippn said...

Thats hardly Mozillo's pay....

Think of it just like another home producer (homebuilder)

THey also pay taxes while the homes sit, but they clean, mow, heat, etc. and "wash the car everyday".