Grand Opening Open House Saturday, January 31st 12-4pm Lunch at Noon – 22018 Bahamas, Mission Viejo


Very attractive 2-bedroom single-level carriage unit condo (no one above or below) on quiet street surrounded by lush tropical landscape throughout the resort-style Coral Gardens community.  This end unit home backs up to wild lands area and provides a very serene and beautiful setting. Private staircase leads from attached garage to upper living space with patio ideal for sunset entertaining. Spacious home has wide plank flooring throughout, 2-tone decorator paint, dual-pained windows, white custom shutters, vaulted ceilings, interior full-size laundry and more.  

Bahamas PoolYou will love the lifestyle that comes with this turnkey home.  Coral Gardens offers tennis courts, spas, a sparkling resort-style pool. Home is strolling distance to Lake Mission Viejo which offers sandy beaches, fishing, volley ball & basketball courts, clubhouse, picnic areas and even kayaks, peddle or party boats to rent for sunset cruises with your friends.  There are summer concerts, a Yacht Club and so much more. Minutes from shopping, fine dining and local eateries.  

This home with its model home good looks it is aggressively priced below others to sell this weekend. Come with your checkbook, and be amazed.  This is the lowest priced 1986 or newer 2-bedroom in Mission Viejo, Lake Forest, Laguna Niguel, Laguna Hills or Rancho Santa Margarita!  Seller must move right away.  Their loss is your gain!

I have not been posting for over a year as I was dealing with cancer. I am healed and my blog is now up and running again. I would love to see your smiling faces at my open house. This place would make a great investment now and later could be a first home for your grown kids. See you on Saturday. This home is not on the MLS yet, for best chance to get this home call Jenean Hill at (949)583-1331


Housing demand in Orange County is so low that it cannot be measured

This is a continuation of yesterday’s piece on the status of the market.  The active listing inventory is muted this year because many homeowners are still underwater.  They may have good credit and a stable job, but they do not have the cash necessary to close because they are currently too far underwater.  Also, many homeowners are now sitting on the fence while they recoup their equity.  Everybody is familiar with the term “buy low, sell high.”  It appears as if the bottom of the market was reached last February and now buyers are flooding the market attempting to “buy low.”  Homeowners know it is a low, so they want to wait.  They don’t want to “sell low.”

 DemandThe lack of inventory is cutting into demand.

As discussed above, true demand is much higher than demand based upon the number of new pending sales over the prior month.  In the past two weeks, demand dropped by 470 pending sales, a 16% drop, and now totals 2,543.  Based upon the word on the street, buyers are scrambling around at anything and everything that is placed on the market right now, but there just is not enough coming on the market.  And, that will remain the case throughout the holiday market, which does not end until the second half of January, right after everybody gives up on their New Year’s resolutions.  Buyers are in a rush to buy, but homeowners are not in a rush to sell.  Instead, they are going to enjoy the holidays with the knowledge that as their homes are slowly appreciating.  Last year at this time there were 46 additional pending sales, a 2% difference.  But, there were 8,905 active listings for buyers to choose from. 

The Distressed Market: The distressed inventory dropped by only 16 homes, but that is still a 4% drop.

For buyers looking for a “deal” and looking closely at the distressed inventory, the pickings are slim.  There are only 434 total short sales and foreclosures on the market today.  Distressed homes make up only 12% of the active inventory and 34% of demand.  Last year at this time there were 3,357 distressed homes on the market, 38% of the active listing inventory and 57% of demand, much different than today.  In the past two weeks, the foreclosure inventory decreased by 12 homes, totaling 110, and has an expected market time of 18 days. The short sale inventory decreased by only 4 homes in the past two weeks and now totals 324.  The expected market time is only 14 days and continues to be one of the hottest segments of the housing market.  Both 110 active foreclosures and 324 active short sales are new lows for the year and levels not seen since the beginning of all of the distressed activity back in 2007.

Home values rise for first time in 5 years

Here’s a great CNN article I just read that does a good job spelling out what is happening in the market. Home prices hit a bottom and are finally bouncing back, according to an industry report released Tuesday. Nationwide, home values rose 0.2% year-over-year to a median $149,300 during the second quarter…

Click here to read full article

California median home prices and interest rates.

Fast Facts 
Calif. median home price: March 2010: $301,790 (Source: C.A.R.) In Orange County, $301,790 will get you a nice 2-bedroom or a not-as-nice 3-bedroom
Calif. highest median home price by C.A.R. region March 2010: Santa Barbara So. Coast $890,000(Source: C.A.R.)
Calif. lowest median home price by C.A.R. region March 2010: High Desert $122,970 (Source: C.A.R.) – In Orange County – This price may get you a so-so 1-bedroom
Calif. First-time Buyer Affordability Index – Fourth Quarter 2009: 64 percent (Source: C.A.R.) – This is considered as VERY high affordability as back in 2006, it was at about 25%
Mortgage rates – week ending 5/6/10 30-yr. fixed: 5.00 Fees/points: 0.7% 15-yr. fixed: 4.36% Fees/points: 0.7% 1-yr. adjustable: 4.07% Fees/points: 0.6% (Source: Freddie Mac)  – Still good interest rates.  It is not that often that home pricing and interest rates are low at the same time.

Waiting Can Hurt You – 30-Year Mortgage Rates Back Under 5%, But Not For Long.

E. Scott Reckard – RISMEDIA, February 13, 2010—(MCT) –   Average rates for traditional 30-year fixed-rate mortgages have fallen below 5% again, Freddie Mac recently reported.

The giant mortgage buyer’s weekly survey, conducted Monday through Wednesday, pegs the average rate nationally at 4.97%, with 0.7% of the loan balance on average paid in upfront charges, or points. Last week, 30-year rates averaged 5.01%. That continues a trend so far this year in which the average has come in either just above or just below 5%.

The survey asks 125 lenders across the country the rates they are offering to borrowers with good credit and a 20% down payment, or at least 20% equity for those refinancing their home loans.

The approaching end of Federal Reserve purchases of Freddie Mac and Fannie Mae mortgage bonds is expected to result in rate increases later this year. The Mortgage Bankers Association estimates the typical interest rate might rise by half a percentage point. If the average 30-year fixed rate rose a half-point to 5.5%, that would still be unusually low by historical standards.

Nonetheless, such an increase would make any home purchase somewhat more expensive and could put an end to a continuing mini-boom in refinances, which have accounted for about two-thirds of home-loan applications this year.

Let’s get specific here.  I have a Lake Forest, California home buyer who has not been keeping up with my blog or newsletters and is facing this scenario: Let’s say that you are approved for a maximum loan amount of $400,000 to purchase a $500,000 home.  If you wait a few months buy that home, it is likely that its price will go up $10,000 to $510,000. You will now need to find an extra $10,000 to add to your $100K (20%) down-payment. No one likes to see that happen and most of us cannot earn money that quickly.  This isn’t the bad news, though.  If you look at the chart, you will see what happens when the interest rate increases from 5% to 5-1/2%.  In order to keep the same monthly payment of about $2150/month, you will now only qualify for a loan amount of $380,000.  That means that you will require an additional down-payment of $30,000 to purchase this same house.  Your down payment just increased 30% from $100K to $130K. 

Buyers who got used to the idea that ‘waiting’ would keep more of their hard earned money need to catch up with the  market and understand that homes under $600-$650K started increasing in price almost a year ago. “Waiting” is now counter-productive and can cost more and more each day.  If you are looking for homes closer to a million dollars, this is not necessarily the case.  Each market has its own dynamics.  To find out what is happening in your price range, just give me a call. 🙂PS0228

Fast Facts about California Real Estate – 64% First-time Buyer Affordability

Front door keyBelow are interesting facts about home prices and home buying in California.  Take a look at the Affordability Index.  C.A.R.’s First-time Buyer Housing Affordability Index (FTB-HAI) measures the percentage of households that can afford to purchase an entry-level home in California. C.A.R. also reports first-time buyer indexes for regions and select counties within the state. The Index is the most fundamental measure of housing well-being for first-time buyers in the state.

You will see that California’s FTB-HAI is at 64%.  Presently Orange County is at 51%.  We went from 18% in the third quarter of 2002 up to 56% at the beginning of 2009.  That is when the market turned around.  By summer it went down to 53% and 51% by the third quarter.  If you haven’t purchased a home yet, the good news is that you can still go buy at 2003 affordability levels.  Currently affordability has begun to decrease about 5% per 1/2 year.  Buying now will put you ahead of the game.

 Calif. median home price – October 09: $297,500 (Source: C.A.R.)
Calif. highest median home price by C.A.R. region October 09: Santa Barbara So. Coast $970,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region October 09: High Desert $118,580 (Source: C.A.R.)
Calif. First-time Buyer Affordability Index – Third Quarter 2009: 64 percent (Source: C.A.R.)
Mortgage rates – week ending 12/24/09 30-yr. fixed: 5.05 Fees/points: 0.7% 15-yr. fixed: 4.45% Fees/points: 0.6% 1-yr. adjustable: 4.38% Fees/points: 0.6% (Source: Freddie Mac) 

5 Questions to Consider Before Purchasing a Home


Interest rates on the benchmark 30-year, fixed-rate mortgage dipped to a 38-year low recently, giving consumers another reason to consider purchasing a home or refinancing their current one.

Freddie Mac recently stated the average rate on a 30-year loan was 4.71% with an average 0.7 point, the lowest rate since the agency began its weekly tracking of long-term interest rates in 1971. A point is equal to 1% of the loan amount, payable as a lump sum at closing. While the decline wasn’t overly dramatic, the dip is likely to get people wondering whether it’s time to sign on the dotted line.

 The 5 following questions may help you decide if now is the time to go ahead and purchase a home or refinance your current home.

Q: Why are rates so low?
A: Since early January, the Federal Reserve has been purchasing mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae in an effort to stabilize the housing market by making homes more affordable for consumers. The Federal Reserve Bank of New York, which is managing the program, plans on purchasing $1.25 trillion of securities.

Q: Are rates expected stay this low?
A: It’s hard to tell, but don’t count on it because the lending landscape is likely to change next year. In September 2009, the Fed said it would gradually wind down the purchase program, ending it by March 30, 2010. That has some in the mortgage lending industry worried.

In a recently published mortgage survey, more than 60% of’s panel of experts predicted that rates will move higher over the next 30 to 45 days. How much higher is anyone’s guess. Last year at this time, the average 30-year, fixed-rate mortgage was 5.53%.

Q: Why do different mortgage surveys come up with different average interest rates?
A: It depends on which lenders are in their sample, when the survey was taken and whether the rates quoted are the posted rate, the application rate or the commitment rate. Also, some surveys take into account the points paid to secure the rate.

But regardless of the survey, the general consensus is that rates are ultra-low right now and may be the lowest the market will see.

Q: What else does a consumer need to know?
A: The lowest rates are offered to the most credit-worthy customers who can make sizable down payments. Shop not just for the interest rate and the points involved but also for the fees involved, which can vary widely from one lender to another.

Q: So is now the best time to buy a home?
A: It depends on personal situations. Homebuyers certainly have a lot of factors working in their favor right now—low interest rates, plenty of marked-down homes for sale and an extended and expanded federal tax credit that will expire in the spring.

How much can you afford?

As the prices of homes changes, so does the mortgage rates. But, what does that mean for your money?

To explain, let’s take a look at an Affordability Analysis. Assume that you have fallen in love with Lake Forest and want to be on the lake. You want to keep your mortgage at about $2400 a month and need to figure out the amount you can spend on a home.

Currently, the interest rate is at 5.5%, but you are concerned about it changing and want to see what will happen if it does. So, you sit down with your real estate agent (me!) and we discuss your options, using a chart similar to this. (click to enlarge)


Basically, it explains the amount of money you will pay on a house given the interest rate and the value of the loan.

So, the $2,400 a month payment , if the interest rate is at 5.5% will allow you to borrow $417,000. If the mortgage rate were to increase to 6.5%, you would now only be able to borrow $375,000 to stay below that $2,400 mortgage. But, if the interest rates were to improve and drop down to 4.5%, you could actually borrow up to $458,700 and still be paying less than $2,400 a month.

Of course, with any market changes, it is always best to discuss it with your realtor. Give me a  call to put together a chart that fits your budget and lets see what we can do!