Category Archives: The Economy

Weekly Interest Rate update, Courtesy of Otto Kobler of Summit Funding

Mortgage Rates for March 11, 2016

FIXED AND ARM CONVENTIONAL PROGRAMS RATE         APR
30 Year Fixed Conventional 3.875%      4.040%
15 Year Fixed Conventional 3.125%      3.265%
5/1 LIBOR ARM Conventional 3.875%      3.963%
7/1 LIBOR ARM Conventional 3.750%      3.803%
———————-
JUMBO PROGRAMS ($417k +) RATE          APR
30 Year Fixed 3.750%       3.967%
15 Year Fixed 3.500%       3.259%
5/1 LIBOR ARM 2.875%       2.972%
7/1 LIBOR ARM 3.250%      3.411%
————————
FHA/VA FIXED PROGRAMS RATE          APR
30 Year FHA/VA 3.500%      4.647%
15 Year FHA/VA 3.500%      4.910%

Continue reading Weekly Interest Rate update, Courtesy of Otto Kobler of Summit Funding

Unique Property? Unique Situation? You Need Unique Financing – Chances are Jennifer Foster, Umpqua Loan Officer, can do that Loan!!

Did you miss the show, or, want to listen again? Here’s the podcast:

Join us on The Real Estate Hour -Sunday 9-10AM pdt. 1350AM, 103.5FM or Streaming live at www.KSRO.com.

Jennifer Foster, Umpqua Bank NMLS #486146 Direct: (707) 636-3404 Cell: (707) 280-9502 JenniferFoster@UmpquaBank.com
Jennifer Foster, Umpqua Bank NMLS #486146 Direct: (707) 636-3404 Cell: (707) 280-9502 JenniferFoster@UmpquaBank.com

Umpqua’s loan products include;  unusual properties, portfolio lending and re-hab and construction loans. Some of our clients have directly benefited from Jennifer’s expertise in these products, as well as the more traditional loans.

We’re excited to hear more.

*By the way – This information is not just for home buyers!*
If you’re a Sonoma County home seller with a unique property, or you’ve been told your home isn’t “finance-able”,  tune in. This show is for you too!

Wouldn’t it be great if you could improve your home’s chances on the market, by increasing your home’s buyer pool? – by overcoming that obstacle upfront with creative financing options for your potential buyers!  win-win!!

This is just one of the extras we at The Kelly-NormanTeam offer our home sellers and buyers. We think outside the box to find solutions…and, so does our guest, Umpqua Bank loan officer, Jennifer Foster.

If you’re buying your first home or you’re a seasoned investor,  navigating through the mortgage process takes time, work, and expertise. Jennifer Foster has that covered, and she’s here to help.

Jennifer’s passion for helping people with their home loans is the driving force behind her success. She especially enjoy working with first time buyers – educating and assisting them throughout the lending process. (which she does very well) Whether you are purchasing, refinancing or building,  she provides consistent communication with everyone involved, ensuring a smooth and worry-free transaction.

Jennifer began her career in lending 25 years ago right here in Sonoma County, and she is proud to have joined Umpqua Bank because they believe in providing that same exceptional customer experience based on superior customer service.

More about Jennifer Foster;

  • Started her mortgage lending career in Sonoma County more than 25 years ago at IMCO Realty Services which became North American Mortgage.
  •  Passionate about educating clients and providing financing solutions that meet long term .
  • Specializes in Custom Construction and renovation financing.
  • With Umpqua Bank for almost 5 years.
    • Product mix includes unusual properties, portfolio lending and construction
  • Active in community serving on local boards and community organizations including
    • Schools Plus Board Member
    • Affiliate Member of North Bay Association of Realtors

On Today’s Show – County Clerk, Recorder, Assessor, Bill Rousseau: Sonoma County Property Tax Assessments 2014, The Good and the Bad News, and The Appeal Process….

On today’s show we’ll be talking about the good (Home Equity is up) and the bad (Property Taxes are up) …and discussing the Sonoma County appeals process if you feel your property’s assessed value is off.

Not sure what your assessed value is? http://www.sonoma-county.org/assessor/SearchRoll.htm

Don’t agree with your Assessed Value? http://sonomacounty.ca.gov/Board-of-Supervisors/Services/Assessment-Appeals/

In California, Proposition 13 baseline year is a major factor in DETERMINING your Property Taxes. Had your property re-assessed, and lowered in the down-market (Prop 8)? Remember, it can go UP quicker than if it is Prop 13 only! We have the man who can explain all of this with clarity on the show THIS Sunday, November 16, 2014–Bill Rousseau–County Clear, Recorder and Assessor! The graph below is a “Follow-Along” for all of our listeners!

Remember, if your real estate was "re-assessed" due to an appeal or general assessment, and it is UNDER your "base-line" Prop 13 value, it will go UP faster than Prop 13's max 2% yearly increase.

 

Bill will answer ALL of your questions regarding Sonoma County Property Tax issues.

This week on the show we are delighted to have William (Bill)  Rousseau, Clerk Recorder Assessor for Sonoma County on the air with us. We’ll discuss the current state of property tax assessments, Proposition 13 AND Proposition 8 and how both inter-play in property taxes on YOUR home. Also discussed will be the once a “lifetime” proposition which allows you to transfer your old Prop 13 baseline to another property within the county. See you then!   707-565-1888

 

Mike Kelly’s Press Democrat Columns PLUS the latest on “Affordabiity in the Bay Area”

I’ve put together all of my popular Press Democrat real estate columns into one “Drop Box” folder including my latest on the real estate “Affordability” issue.

Lack of Affordability means a shrinking Real Estate Dollar!
Lack of Affordability means a shrinking Real Estate Dollar!

Many think our affordability has disappeared by looking at the long-term average in California we are about “average”. Now San Francisco, Marin and San Mateo counties are horribly askew with affordability indexes in the Teens but we are comfortably residing at 29%. This means that only 29% of our population can afford the median priced home at the median INCOME for the county (now around $58,000). Solano is the big affordability champ with an index of 52%. San Francisco is at 14%. But you probably just KNEW that. Click the link below to go to my Press Democrat Column DropBox folder. Enjoy! They are there for you to gather knowledge about the real estate market. We LOVE smart, savvy Buyers and Sellers.

Here’s the Link:  http://tinyurl.com/nmjpdg4

New Loan Regulations–Is this GOOD or BAD for the Real Estate Market?

Join us as show favorite, Otto Kobler, of Summit Funding, explains the new Lender regulations which went into effect on January 10th of this year. Sonoma County, California real estate home prices surged, buyers are IN the market but inventory remains scarce. Question to Otto–are these new regulations

Join us as we discuss the "Shut-down" side effects of lending!
Join us as we discuss the “Shut-down” side effects of lending!

New2014LendingRegs Otto Kobler beneficial to a recovering real estate market place in Santa Rosa, Sebastopol, Rohnert Park, Petaluma-all about the county or a detriment and perhaps wet blanket? This and more on the Real Estate Hour, 9 to 10am PST, Sundays, or at www.KSRO.com

Why WAITING for 3.5% is FOLLY and Financially Naive.

$$SignsThe link below will take you to a Fannie Mae history of 30 year fixed rate loans. The reason I’m bringing HISTORY into the argument of lower interest rates is to show Buyers and Sellers why NOT to “wait it out”. These folks mistakenly think they will see 3.5% again.  It is wise to  understand the dynamics OF interest rate fluctuations and to study past rate increases. For instance,   In April of 1971 the interest rate was 7.31%–(42 YEARS AGO!) it would NOT fall under that rate again until July of 1993 when it hit 7.21%! Oh, and during that time frame it hit a high of 18.45%  in October of 1981!

30 Year Fixed Rates since 1971. Waiting for 3.5% again? Good luck!

The first 11 years of my real estate career we had double digit interest rates with that big high I mentioned above. We STILL sold homes. Sure they were lower but so were wages and salaries. Fast forward to today and we see rates soaring from April to today by one full percentage point or what they say in banking as 100 “basis” points. And this is WITH the Fed taking a long term support measure for keeping interest rates “low”.  What bothers me is the consumer balking at rates exceeding 5% as if THIS is a high rate! Continue reading Why WAITING for 3.5% is FOLLY and Financially Naive.

Sonoma County,Ca-July Sales -5% over last year-BUT!

That’s the headline–Monthly Sales DOWN–market must be cooling? Sluggish? But look closer–break out the sales by price point and it is a dramatically DIFFERENT STORY! See the following graphs:

Overall Sales for Sonoma County
Overall Sales for Sonoma County

As you can see by the above graph OVERALL Sales for Sonoma County -5%. BUT–let’s dig deeper and drill down on the price segments:

$500,000 to $750,000 July 2013 Solds.
$500,000 to $750,000 July 2013 Solds.

Here’s $500,000 to $750,000–UP BIG TIME Year over Year.  UP +87%!  The “Equity Seller/Buyer” is back. This was one of the hardest price points hit during the big heyday of the “Distressed Marketplace”. We had plenty of sellers (the banks) but they NEVER bought when they SOLD. So the “move-up” buyer disappeared and sales sagged. They have ROARED BACK.

July "Solds" $750,000 to $1Million
July “Solds” $750,000 to $1Million

$750,000 to $1,000,000 UP a remarkable 95%. Remember, all real estate is local and the “overall’ market number, though a good indicator does NOT reflect YOUR home and the price segment of which your home represents.

$1Million+Price Range up BIG TIME!
$1Million+Price Range up BIG TIME!

 

As we well know, Sonoma County, is considered a “destination” county–meaning tourists and prospective relocating companies, buyers, KNOW that this county offers a wealth of attractions, amentias NOT found in other bay area counties–consider this–we have a gorgeous, rugged Coast, Old growth Redwood Trees, some of the BEST wine appellations in the world, how about “Foodie” heaven. PLUS we are an hour away from one of the most exciting cities in the world–San Francisco with international air service, World Series Champs Giants, and the iconic Golden Gate Bridge.  So this $1 Million PLUS graph shouldn’t SURPRISE anyone. Solds are up a staggering 187% over last year.

 

Sonoma County Real Estate Market Update–First 6 months Review!

The “Wine Country” real estate market has many “micro” areas from the blistering hot demand and sales town of Sonoma with its idyllic town square, to the SW area of Santa Rosa which is seeing price recovery slower than any area in Sonoma County. I’ve taken the first six months of this year and compared it to last years first six months. The spreadsheet below demonstrates what’s going on.  We broke up the Sonoma County real estate market into categories or “types” of sales. These are the usual “food-groups” from our Multiple Listing Service (MLS). Across the TOP of the sheet it show “All” which means the entire Sonoma County Real Estate market: Single family homes, Condos and Ranches/Farms. I’ve then broken them out to “Current Monthly” numbers (June). So the REO category shows the “Actives”, “Continue to show” (CTS), “Pending” and then the “Sold” is for the ENTIRE  first six months.  I also broke out the June  “Solds” category which shows total  sales of 529. You can follow this category and note the sales where MORE last year for the first 6 months and also for the Month of June. Median price shot up from $332,000 last year to $420,000 this year or 21%. Not bad. What’s striking is the REO and SS (Real Estate owned and Short-Sales) columns which show substantial declines in the distressed marketplace. This is GOOD news! Many who where under water two years ago are now “land-lubbers”. Note that “Cash” sales are identical for both years at 31% of ALL sales. What does all this mean? Cash buyers are still strong and a detriment to the first time homebuyer who maybe a VET or FHA buyer with a small down payment. More equity sellers (real homeowners and sellers) indicates folks are on the move as there is big demand and little supply pushing median up. Plunging “Distressed” homes indicate stabilizing of the default homeowner OR banks just working with folks longer with loan mods, longer default times and short-sale approvals.

 

There goes the neighborhood! Median Price Sonoma Cty breaks $400,000 barrier–Now at 2003 Pricing!

So when the market TOOK OFF one of the thresholds it first encountered was the fabled $400,000 median price barrier–that was BACK in 2003. So TEN years later here we are again at another threshold? Or peak? Our median kept thundering along hitting a record $630,000 at the height of the bubble market in 2007. A whole bunch of foreclosures, loan Mods and Short-Sales later we are crossing the Rubicon once again. What can hold us back?

  • The fed bumping interest rates into the 5% range?
  •  Lender tightening? Pricing frightening away investors?
  •  Europe exploding or more like collapsing under their economic woes?

What is the problem about exceeding the $400,000 Median? For many underwater households an increasing median price and price appreciation equate to a skin-diver snorkeling vs. a deep sea underwater vessel! Like when you look up while underwater and the closer to the surface you can start making out clearer object?  Those underwater are saying, “Go baby! Go!”  However, our crop of first time home buyers may be getting desperate as the median continues to climb. The higher it goes the less home one qualifies. FHA, VA buyers, low down folks, already snubbed for cash buyers, are seeing the dream slip through their fingers AGAIN!

At the height of the last big bubble market, 2007, our “Affordability Factor”, based on the median income of Sonoma County, was 6.5%. This meant  ONLY 6.5% of families earning the income could buy a home. Our “Affordability Factor” was that of Santa Barbara with a median home price of $1,100,000. But the scariest portion of the last bubble market was the DUMB money out there. Fog a mirror—YOU’RE QUALIFIED. That is gone from the system. My friends keep telling me look out, $630,000 here we come. But I think the last 3 years of our market was all fueled by EZ lending practices and EVERYONE up the real estate food chair looking the other way. It went all the way to Moody’s who rated loan packages as A paper when the package was mixed with junk from all over the state of California and beyond. The economic boys and girls started scratching their heads when default rates, historically in the single digit range, jumped to double digits just MONTHS after origination.

  But “Frank-Dodd Legislation” should make this an impossibility. Low inventory will drive the market to a point. WE shall see. Stay tuned!Below–Median Sales Price up 26% over last year and now sitting at $402,000 of TOTAL market (Condos, SFD’s and Country Property).