The Obama administration announced today new guidelines for pre-foreclosure properties that should streamline the short-sale process and expedite deeds-in-lieu of foreclosure. The highlights of the guidelines are:

1. Mortgage loan servicers must determine if a short sale is possible before proceeding with a foreclosure.
2. Loan servicers will receive $1,000 from the government for successful short sales.
3. $1,500 to borrowers for relocation costs.
4. Up to a $1,000 to junior lien holders to release their liens. The government will pay $1 for every $2 put in by the senior lien holder.
5. Standardized documents to streamline the process and remove some of the complexity.
6. Loan servicers must give borrowers at least 90 days to market the property as a short sale and up to a year depending on market conditions.

More information will be on the way, but this should change the number of foreclosures that we were expecting to see. And though it is too early to tell I am hoping that it will make the tedious, frustrating, and slow process of buying a short sale faster, easier and more appealing to buyers who have been reluctant to write offers on short sales.

The 1st quarter statistics for Coastal North County properties are ready. Please see the table below. Sales are strong in Oceanside where it is now possible to buy for less than it would cost to rent. If the law of supply and demand prevails the price of homes will fall in zip codes with a greater than 6 month inventory of homes. How far? No one knows but it is obvious that in Rancho Santa Fe sellers are hoping that buyers will begin to appear.

Home prices tend to be somewhat sticky. Some sellers will simply not sell and choose to rent or stay in their home until values increase. We have not seen huge numbers of distressed sellers in many of the higher priced zip codes in North San Diego County. But most experts feel that we are about to. In this analysis the absorption rate was figured by calculating the number of homes sold in the last quarter and projecting that rate for the current inventory.

Unfortunately only sheer dumb luck will allow someone to buy at the absolute bottom of the market, because the only way to gauge the bottom is when it starts back up. What a buyer must ask them selves is if the purchase makes sense. Interest rates are at historic lows. The value of many properties have fallen as much as 35%-40%. Many thanks to Gary Keller who provided the graphic below.

The following information comes directly from the Assessor’s website:

Under state law a temporary reduction in assessed values can be made when the market value, as of January 1, 2009, falls below the assessed value. Once reduced, the Assessor’s Office must then annually review the value of the property. When the property values increase, the assessed value will also be increased but no higher than the original assessed value (plus the annual CPI increase, not to exceed2%, as required by Proposition 13). The current taxable value of your home is found along the right hand side of the top portion of your property tax bill.

Many private business and individuals are soliciting homeowners and will do this for a fee. However you can do it easily yourself and we will be happy to provide you with the comparables and the necessary Application for Review of Assessment. The deadline for submitting your application for reassessment is May 30, 2009, so call us today if you would like help with this. Notification of the result will be in early July, and an appeal process should you disagree with the result is available. More information is available on the assessor’s website.

If you or anyone you know needs help finding comparables to support a reassessment I will be happy to help-at no charge. Please call!!