Homes in South Lake Tahoe

Foreclosures in South Lake Tahoe May Be Effected by Policy Changes

Fannie Mae has launched pilot projects in Phoenix and Orlando intended to reduce foreclosures by pre-approving short sales, agreeing on a price and the loss it will take prior to a deal even being made. It is hoped the program will improve the popularity of short sales among real estate agents.

Property professionals initially had welcomed short sales but soon found the process to be a frustrating one-due to squabbling about the sale price and slow approval times by the mortgage companies-that often ended with no sale at all.

“Short sales have received such a bad reputation among real-estate agents that, as a portion of the overall mortgage market, they have gone down,” says Tom Popik of the research firm Campbell Communications, whose November survey of realty practitioners found that agents had to wait as long as 8.1 weeks to receive a response from the lender on a short sale. That was nearly double the 4.5 weeks the process took earlier in the year.

Fannie Mae’s pilot will focus on homes that are listed at less than the mortgage balance and carry a Fannie Mae-backed loan serviced by Countrywide Financial Corp.
If it proves successful, the concept could be expanded to other geographical areas and additional lenders. There are concerns, in the meantime, about the program’s success, with real estate agents noting that property prices could decline before the pre-approval is issued.

I think that Fannie Mae is making the right decistion to negotiate short sales over foreclosures. The foreclosure process takes time, and time is money. Foreclosure is also expensive for the lenders, the more money that the lenders loose, the worse the effect will be on the lending market.

Short sales are also a better option for the homeowner. Although a short sale does adversely affect credit, it is not as bad as loosing your home to foreclosure.

I think that Fannie Mae will find this trial policy to be effective and will soon spread it across the country. Other lenders will follow Fannies lead. They would be crazy not to. This will in effect reduce the amount of foreclosures in South Lake Tahoe. With more homes in South Lake Tahoe being sold as short sales, agents will also need to adapt and gain confidence in short sale transactions

Source: The Wall Street Journal, Nick Timiraos (01/09/09)

For more information about South Lake Tahoe Real Estate, Short Sales and Foreclosures in South Lake Tahoe, or houses on the South Lake Tahoe MLS, contact Brent or Jill Johnson.

South Lake Tahoe Real Estate May be Affected by Low Interest Rates

Mortgage Rates Continue Falling to Record Lows
For the fourth consecutive week, mortgage rates have fallen to all-time lows. The 30-year mortgage rates averaged 5.01 percent this week, which is a drop from last week’s 5.1 percent. Last year at this time, rates averaged 5.87 percent.

“Interest rates for 30-year fixed-rate mortgages fell for the 10th week … due in part to the Federal Reserve’s recent purchases of mortgage-backed securities issued by Freddie Mac, Fannie Mae and Ginnie Mae,” says Freddie Mac Chief Economist Frank Nothaft.

Other rates also dropped for the week:

15-year fixed rates: dropped to 4.62 percent from 4.83 percent last week. Last year at this time 15-year mortgage rates averaged 5.43 percent.
5-year hybrid adjustable-rate mortgages averaged 5.49 percent, a drop from 5.57 percent last week.

The only slight increase in rates this week was in 1-year ARMs, which were 4.95 percent, up from 4.85 percent last week. Overall, 1-year ARMs were still down for the year from last year’s 5.37 percent.

Freddie Mac began tracking rates in 1971.

Source: The Wall Street Journal, Amy Hoak (1/09/09)

Interest rates are a very important factor to consider when timing a real estate purchase. When purchasing a $300,000 home with a $250,000 30 year fixed loan at 5.01% including tax and PMI, the payment would be $1708.17 and the total of all payments would be $614,939.65. The same scenario with a 6% interest rate would raise your payment $155.29 to $1863.46 and raise your total payments to $670,845. There are a lot of buyers looking at homes in South Lake Tahoe right now that are trying to time the bottom of the market. When rates rise to 6% it will be like paying $55,906 more for a $300,000 home using a 30 year fixed rate loan.

I think that these low interest rates will stimulate the South Lake Tahoe Real Estate market. However it is still important to buy undervalued properties from motivated sellers or foreclosures in order to offset any future declines in the market.

For more information about South Lake Tahoe Real Estate, loans, or houses on the South Lake Tahoe MLS, contact Brent or Jill Johnson.

South Lake Tahoe Real Estate Review for August

Pending home sales in South Lake Tahoe increased 23% increase in August compared with July. In August there was 43 pending home sales reported on the South Lake Tahoe MLS compared to 33 in July.

The statistics for the August pending sales are as follows:

-Average days on market 97

-Minimum price $259,500

-Average price $539,215

-Median price $435,000

-Maximum price $2,300,000

Out of the 43 new escrows six of them are bank owned foreclosures, and eight were reported as short sales. Five of the new escrows are located in the Tahoe Keys bringing the Keys to a total of 7 open Escrows. There is now a total of 64 pending escrows on the South Lake Tahoe MLS.

Sold homes in South Lake Tahoe saw a 15% decrease in August compared to July. There were 33 sold houses reported on the MLS in August compared to 39 sold in July.

The statistics for the August sold houses are as follows:

-Average days on market (including escrow period) 150

-Minimum price $189,000

-Average price $521,597

-Median price $467,500

-Maximum price $1,200,000

There were only three foreclosures that were sold in August on the MLS.

Activity on Condos in South Lake Tahoe remained slow with four condos reported as pending, and four that sold. Two of the sales were in the Tahoe keys.

Lot activity was similar to condo activity. There were four lots that went into escrow, and two that sold in the month of August.

The 23% increase in pending home sales for August shows that home buyers are starting to take advantage of the opportunities in todays buyers market.

More Changes For South Lake Tahoe Vacation Rentals

On Tuesday August 19th, the South Lake Tahoe City Council approved several rule changes for vacation rentals.

Starting September 19th, vacation renters will not be allowed to use the house for commercial activities, including wedding receptions and large parties.

Restrictions on occupancy and overnight parking will now be from 10 p.m. to 6 a.m., changed from midnight-to-6 a.m..

Vacation rental homes will also be required to post signs on the homes that state the maximum number of occupants and vehicles allowed at any one time. The phone number and e-mail address of the police will be required to be on the sign for potential complaints.

Permit fees for vacation rental homes will be increased to cover the cost of a new community-service officer who will enforce the new rules and respond to complaints.

Regulating vacation rentals in South Lake Tahoe is a much better solution to correct concerns than the previous idea of a vacation rental moratorium.

I have quite a few clients looking for homes in Lake Tahoe that plan to supplement some of the ownership costs by renting the house out as a vacation rental. If vacation renting was not an option, they may not be able to own a house in beautiful Lake Tahoe!

South Lake Tahoe House for Sale Just Sold!

JUST SOLD!!!

1476 Glenwood Way, South Lake Tahoe

3 bedroom, 2 bath, 2 car garage

1406 square foot single story ranch style home

Sales Price $375,000

I recently had the pleasure of helping first time home buyer Thia Mullikin purchase her first house. First time buyers are finding some great deals on Real Estate in South Lake Tahoe. The house that Thia was able to buy was twice the size of the house that she almost bought in 2006. Thia had been looking at homes in South Lake Tahoe for almost three years, and decided that now is the time to buy. Thia also said that it was well worth the wait!!!

Here is what Thia had to say about her home buying experience with my wife Jill and I:

“As a first time home buyer I was very inexperienced in the details, follow up and continual negotiations involved in buying a home. Further, in a place like Lake Tahoe where there are many Realtors to choose from, I fortunately had the luck and pleasure of working with Brent and Jill Johnson. This team not only was available at my convenience to view listings, but also truthful and ethical in helping me make a decision to buy my first home. The process was seamless, the negotiations and follow up prompt, and the personal relations delightful. As a Tahoe local I would recommend the Johnsons to any of my friends or family who need help buying or selling a home.”

-Cynthia Mullikin MPAS, PA-C

South Lake Tahoe, CA

April South Lake Tahoe Real Estate Review

April home sales in South Lake Tahoe saw a significant decline compared to March home sales. There were 20 single family homes in South Lake Tahoe that were sold in April, compared to 34 homes sold in March. Out of the 20 sold homes, only 4 were foreclosures compared to 11 last month.

The reason that there were only 4 foreclosures sold in March is because the amount of foreclosures coming on the market in South Lake Tahoe has been going down. There are a lot of buyers targeting these foreclosures, and the reduction in foreclosure inventory may be one of the reasons for the reduction in home sales in April.

The lease expensive home sale in April was a foreclosure at 1667 Choctaw which sold for $235,000. On the upper end of sales was 1323 Keller, which sold for $1,200,000.

According to the South Lake Tahoe MLS, there were 25 houses that went into escrow in April, 5 of which are foreclosures. There are now 51 single family homes in escrow in South Lake Tahoe.

Lot sales are still stagnant in South Lake Tahoe. There was only one lot sold in April, which was in the Angora fire area. There were three lots that went into escrow, including a great view lot on Cornice for $349,000.

April activity on Condos in South Lake Tahoe was similar to March. There were only two condos sold, and four condos went into escrow.

I expect the South Lake Tahoe Real Estate market to show a slight improvement in May. Conventional loan interest rates have just dropped back down to around 6%, and summer is just around the corner.

There are a lot of home buyers that are on the fence about buying. These home buyers are trying to time the market, and to buy at the “exact bottom”. The problem with this strategy is that by the time the signs of the recovery of the real estate market are there, such as increasing pendings and sales, those buyers will have missed the bottom completely!

For all of those buyers out there, think long term!!!