The Streams are Blocked...

Ya'll are just not paying enough in fees and taxes on those fully financed homes. Time to ante up people - pony up that cash, the streams aren't running.

As reported at the Calveras Enterprise, the County's housing revenues hit slump.

A total of $2.2 million from fees was projected during final budget hearings last September.
“Fees collected may be impacted by the current moratorium on new developments,” the report said.

“This could continue to impact this revenue stream through the end of the year.”
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Taxes collected from property sales in Calaveras were at 37 percent, or $316,766, but should ideally be at 50 percent for the mid-year point.

This is a dramatic change from last year, when the county saw a 30 percent jump in home sales above what was anticipated.
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Employee wages and benefits, which take up a large chunk of the budget, will be negotiated for the Calaveras County Sheriff’s Department and non-safety employees in the coming months.
In August 2006, county workers got a one-time 3.5 percent and additional 4 percent pay increase for the year, as well as health benefit increases.

This, along with department staff changes, totaled to more than $1.7 million of the general fund.

With an unstable housing economy, county supervisors will have to wait and see how next year’s finances will turn out.

“Do I think the revenue (from home sales) will be what they were? No,” Callaway said. “That’s why the budget is one of the more critical things the Board of Supervisors does in any county.”

In regards to the Building Department, she said, “If fees are low in relation to what it costs to manage the department, the county is going to have to bite the bullet and raise fees.”

Update on Surrey Junction in Pine Grove...

In a previous post, we put together a profile of this home (link here).

As a recap, this house has been on the market over 17 months with apparently little success. When I first noticed it, the owners were asking $895k - not a small fee by most standards. No doubt, this is a nice pad, but I wonder if perhaps they are truly motivated to sell.

Not much to say on this. So far, they have dropped the price a whole $45k - now down to $850k. That is around 5% decrease in asking price, which I am sure creates standing room only at the sales office, but it appears with 517+ days on the sales floor that they can likely afford to wait for someone to hit the lottery. Or, maybe someone can use their tax return for the down payment.

I hope they realize what they are doing to the home sales statistics.

Here is the new link.

What $305k doesn't get you in Pioneer...

Here is someone's dream home - but apparently not their dream price. This home was listed 12/06 for $305k. Let's take a look at what you get.

OK, well...let's read the description. There has to be more to it than this with an $1800/month P&I payment + taxes + insurance (roughly $2300/month).

The description says: "Needs new septic & roof, to be done at COE. Many recent upgrades to this comfortable 3&2 incl. new paint,carpet, kitchen counters, vinyl, & slate hearth. Office/hobby has DSL & multi phone lines. Oversized garage has lots of storage, and RV storage next to it."

Oh...DSL...OK, that might make sense. Hmm...

Well, I have seen worse. Let's go inside - you can't always judge a book by its cover.

Or, maybe you can. Holy cow! Is that the new Rose-Dalmatian carpet I've been hearing about? Look at those spots! Is that the carpet upgrade they mentioned above? I'd hate to see what it looked like before. Was it just a cement slab? Well, let's continue on.

By this time, I am sold! What else is needed to start your own home-office? Perhaps we might even consider a home-based realty business.

Well, the tour is over even for the previous note holder - now a foreclosure. It does not appear that anyone scooped up this gem for the aforementioned asking price. The lender is now asking a slightly reduced $279k. Good luck with that.

27226 FORREST OAK RD PIONEER, CA 95666 $273,000

Subprime Stats...

Here are some stats from the Wall Street Journal as posted by Towel Talk on the subprime market that are fairly interesting.

• Subprime loans have grown to 12.75% of the $10.2 trillion mortgage market in 2006, up from 8.5% in 2001 (Wow! That is 1.3 trillion just for '06)
• 47% of subprime loans are "creative" -- up from 2% in 2000 -- featuring "piggyback" loans which require no down payment and "no-doc" loans that let borrowers state their incomes without supporting documentation. While this creativity works fine when housing prices rise -- if a borrower defaults, the lender can profit by selling the property -- it does not work when housing prices are going down. (Hello! That is $611 billion in creative financing. At an average price of $235k - that is 2,600,000 homes.)
• 80% of subprime mortgages are exploding ARMs (adjustable-rate mortgages) with low fixed-interest payments in their first few years which later adjust to higher interest payments. When the ARM adjusts upward, some borrowers can't afford to pay. The resulting foreclosures lead the mortgage company to sell the house to get back some of the loan principal. The sudden increase in the supply of houses on the market puts further downward pressure on prices. (Math, people...do the math. That's $1,040,000,000 in exploding ARMS! That is a lot of zeros.)
• Nearly 1.2 million foreclosure filings were reported in 2006, up 42% from 2005, representing one in 92 U.S. households. This trend will worsen if interest rates rise.
  Borrowers have never been more leveraged. Loan-to-value ratios, the loan amount expressed as a percent of the property value, have grown to 86.5% last year from 78% in 2000. With all the new supply on the market, these loan-to-value ratios are likely to rise as the values decline. This will mean steeper loan writeoffs for mortgage lenders which will deplete their capital. (No comment necessary.)
• At least 20 subprime lenders have filed for bankruptcy or have been sold. As mortgage-backed securities buyers exercise their rights to force mortgage originators to buy back the bad loans, the loan originators will likely be unable to come up with the buyback cash -- leading more of them to file for bankruptcy.

Quite a Discount....

I know, I know, you may be tired of dreadful housing news. Hey, this will cheer you up! David Lereah says that now is a good time to buy; so get in line lemmings.

If you are looking for a deal, look no farther than this for a $621k discount!

This one is just around the corner and of course is "close to everything".

All the way from Pioneer, California, I present to you the foreclosure of the week...drum roll please...26871 WOODLAND. (White noise, applause, and aggravated screaming of the Discount of the Month recipient.)

In December of 2006 (suddenly, a long time ago in real estate), this listing was up for grabs for $1.2M. That's right folks - $1,200,000! I know, you are saying to yourself "that is a steal". Hey, a bargain hunter's dream. But wait, there's more. Tell them what they have won Johnny!

Well, according to the omniscient and heavily cognitive Zillow, this mountain retreat should be demanding no less than $925k. Perhaps the previous owner had a case of "irrational exuberance". But, what is this? Last sold on 11/06 for $739,267? Looks like an FC.

Now, according to the "Zestimate TM", the new "owners" should be asking for almost a $million. But, something must be wrong back at headquarters. Currently on the foreclosure list, this has been recently reduced to $579k.

26871 WOODLAND RD
PIONEER, CA 95666
$579,900
Agent: Sharon Rintala
(209) 295-3800

Going Down in the Valley

Here is yet another example of home prices that reflect the true image of value in the market. Wow, that is fairly poetic.

Anyway, here is the listing for this 3x2'er in beautiful Valley Springs back in April of 2006:



If you squint, you can see that they were asking $500k - half of a million dollars! When you actually say "half-a-mil", it sounds like a lot more than $500k. Maybe the cost is wrapped up in the roof repair - that's a lot of roof.

Zillow/Yahoo, which is always reliable on pricing estimates (insert laughter here), puts this piece of property at $500,347.00. Seemingly, the listing price is right on, but the recently "sold" price of $321,233 looks suspicious. Can someone say foreclosure?

Well, low and behold, even the lender doesn't think it is worth that extraordinary amount of greenbacks. They are currently asking $238k! That is a drop in recommended Zillow asking price of less than half! And it looks like the bank is going to write-off that extra $83k. Ouch!

Somehow, I still think it is a bit lofty.

Here is the info if you are interested and the map link:

2376 HEINEMANN DR
VALLEY SPRINGS, CA 95252
$238,000
Agent: Vicci Fikes
Century 21
(209) 920-1520
Listing last updated: 02/08/2007 19:05:12

"Choked In The Sea" - Unexpectedly

Sorry to report this, but it was inevitable.

HSBC, New Century warn of US subprime lending woes

NEW YORK, Feb 7 (Reuters) - Two of the biggest lenders to Americans with poor credit histories said on Wednesday rising subprime mortgage defaults will weigh unexpectedly on results.

HSBC Holdings Plc, Europe's biggest bank, said it plans to set aside $10.6 billion companywide for bad debts, 20 percent more than the $8.8 billion it said analysts expected on average, because of struggles in its HSBC Finance Corp. lending business.

Chief Executive Michael Geoghegan is directly involved in trying to fix the problems, it said.

Meanwhile, New Century Financial Corp. projected a fourth-quarter loss, and said it expects to restate each of the previous three quarters' earnings lower because it did not set aside enough money to buy back subprime loans that went bad. Analysts polled by Reuters Estimates had on average forecast a fourth-quarter profit of $1.06 per share.

Calaveras Codes

Man, when things get tight, bring on the fight. The Stockton Record, is reporting that suddenly someone wants to enforce the California Uniform Building Code. I wonder how many things were overlooked over the last few years in order to facilitate the "boom".

Living up to the Calaveras codes

The slowdown in home sales couldn't come at a worse time for builders and contractors in Calaveras County.

It roughly coincided with the arrival of Stephanie Moreno as community development director. She took over May 15 and has been enforcing the California Uniform Building Code.

In December, she ordered an outside audit.

It revealed "that minimum fire- and life-safety requirements had been overruled or waived" for some approved plans.

The appropriate enforcement of regulations has compounded the difficulty for those in the building trades.

Plan checks take longer and require a higher threshold for approval. Combined with a stagnant housing market, it's no wonder building contractors showed up to protest the stricter rules at last Tuesday's Calaveras County Board of Supervisors meeting.

Still, the minimum standards - set for good reasons - are the law.

You Are on the Default Train in Grizzly Flats

All aboard - you're on the Default Train! Hang on, it may be a rough ride!

I know, you may be saying to yourself, "Where in the heck is Grizzly Flats?" Here is a map in case you feel the need to tell somebody, "Yes, I really was there, honest."

Well, apparently the lender knows exactly where it is even if nobody else does - and they want their money.

From the Mountain Democrat (Public Notices Section), here is the official Trustee Sale number and notice for the following gem in the rough:

NOTICE OF TRUSTEE'S SALE T.S. No. 5386Loan No. 08-702182-00 YOU ARE IN DEFAULT UNDER A DEED OF TRUST DATED 4/17/2006.

(Notice the Deed of Trust Date - hmmm.)

So, the story goes that waaaay back in October of 2006 (do you remember back that far?) the asking price was $365k as seen here:

4xxx Creekside Dr, Grizzly Flats, CA 95636MLS ID: 40170088
$365,000.004 beds, 2 baths, 2224 sq. ft., 1 acres

Well, in chapter 2 of this epic novel, one thing led to another...a payment was missed...a vacation purchased...and they decide to sell in this "hot" market to get out of their dilemma.

Uh oh, it turns out that living way out in the sticks is not as popular as one may have formerly believed and gee, it may have been asking a bit much for someone to fork out over $2k per month to live in that metropolis.

It is now down to $270k and look at all you get - think of about that...since October, that is about $23k savings per month. I wonder what the price will be next month.

February 7, 2007
Price $270,000
Type 1 House on Lot
4xxx Creekside Dr
City Grizzly Flats, 95636
Subdiv Grizzly Park
Stories 1 Story
Sq Ft 2224
Cost / Sq Ft $121
Faces Northeast
Year 2006
Lot Size - Acres 1.130
Bed 4
Full Baths 2
Half Baths 0
Fireplace(s) Family Room,Gas Burning Log
Heat Central,Natural Gas
Garage No Garage,Other
Laundry 220 Volt Hook-Up,Gas Hook-Up,Inside Laundry Room
Landscape Low Maintenance
Remarks Wow Best Value. Brand New way under market value. Secluded in a gorgeous area of Grizzly Flat with great views. Open/Spacious floor plan with custom details. 25 minutes from Placerville, 45 mins from Folsom, 59 miles from Kirkwood Ski Resort. Manufactored home on a permanent foundation. Won't last, bring all offers!

But you better hurry, because the auction date for this "manufactored" home has been set for 2/21/2007 at 10:00 AM.

Place of Sale: At the main entrance of the County Courthouse - 495 Main Street Placerville, CA.

All aboard!

Sutter Creek Living just got a whole lot cheaper

Here is another great listing I found. Back in September of 2005, this home was on the market for $520k. They have since become a little more cognizant of the market or perhaps a little more desperate to sell - you can't but help notice that the house is discernibly empty. Hmmm...

It is now down to $475k.

Anyway, the write-up on this home says that it has "all city amenities". What is that supposed to mean? Does it have running water and an indoor lavatory? I guess that is for all of you out-of-town bluebloods and retiring metropolitan nobility that could not consider living more than 5 miles from a Starbucks. Oooh, how aristocratic...

Let the bidding begin: Sutter Creek Living

Amador in the top 10

Here is some good news for all those that believe that Amador is overpriced, becoming too congested, and maintaining stagnant wages - Amador County rated in the 10 "Best Places to Live in Rural America".

Perhaps the author is unaware of the push to "de-ruralize" this rustic and provincial county and bring it in line with the living equality of Sacramento. Can’t wait for the tagging to begin…

But for now, we are honored with the thought and gesture of including us in their best of the best list.

From the Stocton Record:
Magazine hails living in Amador

From PR Newswire:

Annual 'Best Places to Live in Rural America' Rankings Released