La Jolla Bank Troubled Over Bad Loans

La Jolla bank has been ordered by Federal regulators to raise more capital after the bank has suffered an increase in delinquent loans over the last few months. The Office of Thrift Supervision has directed the privately held bank to acquire more capital and take steps to better its operations. The bank’s chief executive has hired an investment bank and hopes to raise close to $150 million. The bank is based in Rancho Santa Fe and currently has $3.8 billion in assets. It is designated “well capitalized”, the highest such distinction, under federal guidelines.

San Diego Home Sales Increase Compared to '08

Home sales in San Diego jumped to twelve percent compared to last year, while prices dropped almost fifteen percent. I just posted an article on my San Diego real estate news section on my website. Read the entire article.

Median Sales Price for Southern California Rises Again

Southern California home sales for July were 20% lower than July 2008. The median
price of homes for the region rose from June to July, the third consecutive monthly
increase. The median is just one percent above June’s median, but still 22% below
July of 2008.
July home sales across the six counties of Southern California totaled more than
24,000. Still almost 9% lower than the average number of home sales in July since
1988.
The increase in sales can be attributed to the lower prices, lower interest rates,
abundance of FHA backed loans. Foreclosures accounted for about 44% of all sales in
July, the lowest percentage in 13 months. The highest proportion of foreclosures to
home sales was 58% in February.

Search La Jolla real estate, or Downtown San Diego condos

Local Home Builder Going Under

A local home builder, Barratt American, switched its bankruptcy filing from Chapter 11 to Chapter 7 last week because the company’s creditors claimed that any attempt at reorganization would be unsuccessful.

Through June, there were only 908 building permits issued in San Diego County, compared to 1,409 from January to June 2008. During the hpising boom, in 2005, there were 4,795 permits issued through June. Yet, surprisingly, Barratt is one of just a few builders to go under. Barratt is chiefly known as the developer for the master-planned Fanita Ranch community in Santee. Approved for 1,400 homes in 2007, the community is in jeopardy itself. The two mortgage holders are currently in the beginning stages of foreclosure. Search La Jolla foreclosures, or other La Jolla real estate

Coronado Naval Base Going Solar

Synergy Electric Company, Inc. was awarded a $3.93 million contract to install roof-mounted solar power systems(SPVPS) at Naval Base Coronado, as part of the American Reinvestment and Recovery Act.

The company will be installing more than 133,000 square feet of SPVPS on three buildings at the base. The project includes the demolition of the existing roof, installation of the new roof, and installation of the SPVPS.

The SPVPS will supply electrical power to the buildings and divert the excess power back into the local civilian power grid. The work is scheduled to be completed by January next year.

All the Home is a Stage

Well, I finally found someone in San Diego to repair my computer. My hard drive blew and I had to have data recovered. So, I finally have some time to write this post. Ok, here we go. What is staging? And why do you need it? If you need to sell your house quickly whether because of a new job, a divorce or if you are simply upgrading to a larger home then here are some tips to attract buyers as soon as possible.
Experts agree that sellers in a buyer's market have to take the extra steps to make their property stand out from the others. Buyers need to feel an emotional connection immediately upon entering a home, and then they will desire to continue to tour the home as opposed to hesitation.



Since there are fewer qualified buyers in the housing market today, then sellers need to get serious about presenting their property much like a stage. This is not to be confused with decorating. Decorating shows the skill and personality of the home owner, while Staging showcases the property for the potential of the home for the new owner. This is showcasing the personality of a home and you are looking for a match for a potential buyer. For example décor, art, and the use of color are all exhibiting the style of the owner, not the home, and should be downplayed to find the charm of each property.



When the new homebuyer finds the personal connection to a home, then they get excited and when buyers get excited they make higher offers. There are persons offering professional staging services available for hire. The money spent hiring a professional can actually help people save money at closing. A typical consultation fee can be in the one hundred dollars to two fifty range, depending on the time the stager invests, the location and size of the home. Some expenses stagers incur are furniture rentals, and thus this can result in a monthly charge as well as the initial consultation fee.



This is one of the most important issues that involve staging a home. An empty house has negative connotations and imagery of abandonment. Filling the home with furniture shows the potential buyer the hope and expectations of the homes. Showing the buyer a furnished home creates for the buyer the sense that there are many possibilities and the home can come to life with expectations of success, style and nesting. Leather furniture can make a nice addition. Sometimes something as simple as a contemporary leather sofa can do the trick.



The use of color has been mentioned as an expression of personal style, therefore professional stagers recommend only the use of neutral colors. This allows the buyer to see a blank canvas for their imagination, as opposed to crashing the deal because a buyer does not connect emotionally to a colorful pallet, or specific décor. For example, if there is a singing fish on the wall, then the buyer's main impression of the home is associated with a singing fish, which can be detrimental to the sale if the buyer can not get past the memory of the fish. The sale can tank especially if the buyer has an unhealthy fear or dislike for fish. But this is the concept of neutralizing the pallet of the home.



One of the final things sellers need to be aware of in order to stage the home for a quick sale, and one of the best reasons for staging at all is the Distressed Seller. When a home is being sold under distress, due to foreclosure or divorce or for any other less than optimal reason, then this sense of desperation and disarray translates in to the ambience of the home. Staging is a way distressed sellers can correct the negative energy, project the inherent value and sell the home.

“The Donald” Says it's Time to Buy Real Estate

Business mogul and reality television star Donald Trump has always been very forthcoming with his opinions and advice. Whether confronting a celebrity, or advising people on money management issues, he’s never been shy about offering his two cents.

These days, Trump is touting the benefits of stockpiling real estate. He appeared on Good Morning America recently and spoke on a variety of topics. Just as real estate agents have been claiming for months now, he says that today’s rock-bottom prices make it an ideal time to buy a home.

Trump does acknowledge that it’s difficult to obtain financing these days and chastised banks for not being more willing to approve loans. He says that banks have billions of dollars of taxpayers’ money but are unwilling to loan that money back to the taxpayers. The answer, according to Trump, is to buy up bank-owned properties. Banks gain ownership of properties after they are foreclosed, something that has been happening at an escalated pace in the recent housing crisis. Banks are more willing to help a potential buyer get a loan for a home that they, themselves are trying to sell. He says that the banking industry is flooded with homes that they neither want, nor know what to do with.

Trump has also suggested that if banks receive money under the Troubled Assets Relief Program, then they should be subject to compensation restrictions. He says that in effect, when these banks receive Federal Assistance, they are working for the government. Trump voices many of his opinions and advice in his recently-released book, "Think Like a Champion: An Informal Education In Business and Life." Noteworthy topics which he discusses in the book are keeping your eye on the big picture, creating one’s own luck, going against the tide, and giving yourself another chance.

San Diego County Rental Market in Flux

As the deepening recession puts pressure on tenants, as well as landlords, a recent survey of San Diego County apartment complexes revealed that rental occupancy is down. Experts say that even though rental rates have remained stable and complexes are loosening just a bit, the overall market is still pretty tight. Sales of downtown San Diego condos are on the rise compared to previous months, however, rentals are not. Other markets in the Southern California area, meanwhile, have been doing even worse as renters who’ve lost their jobs move to more affordable areas or take on roommates to split expenses. One official said that the occupancy rate in the county dropped below 95% compared to almost 98% a year ago. The average rent increased almost 2% to about $1,330. Rent is expected to continue this trend and rise another 1% over the next 2 years. In spite of growing layoffs in the construction industry some sectors of the local economy are actually fairing decently.

One plus is the military bases all over the county because military are commonly renters. Some
have left the rental market and are buying homes due to the lower prices brought on by rampant foreclosures and other factors.

Many analysts have been surprised by how well San Diego County’s rental market has fared, while others say that the county will hold up much better than other regions through the rest of the current recession. Last quarter the average rent for one-bedroom apartments in the county was a little over $1,160, 2-bdrm units averaged $1,415, and 3-bdrms $1,735. The new supply of rental apartments for 2008 was 1,430. Compare that to the forecasted 1,510 for the coming year.

In Los Angeles County the average apartment rental rate fell almost 4% from last year. Orange County saw its first drop in rental rates in thirteen years with the average dropping 2%. In Riverside and San Bernardino counties average rent fell 4% while the occupancy rate fell from just over 95% to just over 91%.

Who Will Benefit from New Obama Housing Plan

President Barack Obama’s administration activated a new housing assistance plan aimed at helping Americans avoid foreclosure. The plan is called the Homeowner Affordability and Stability Plan and earmarks $75 billion towards helping homeowners in two ways. The first involves refinancing to lower rate loans and the second involves awarding incentives to lenders to encourage them to modify existing loans.

The refinancing portion of the plan is aimed at homeowners who have stayed current on their mortgage payments yet have been unable to refinance because of a severe drop in their homes’ value. Under current standards homeowners with less than 20% equity in their homes have almost no chance to refinance. The new standards should be a great help. Homeowners will be eligible as long as their debt does not exceed 105% of the home’s value and the loan is owned or guaranteed by Fannie Mae or Freddie Mac(officials are still seeking participation from other loan servicers). Borrowers will have to provide proof of sufficient income to afford their loan payments.

The loan modification portion of the plan is intended for homeowners who are at risk of foreclosure or already in foreclosure. To qualify, a mortgage has to have originated before January 1st, and the amount owed must be no more than $729,750. For eligible loans, loan servicers or lenders will reduce the borrower’s monthly payments to 31% of gross income. The reduction will be accomplished through lowering of interest rates(2% minimum) or extending the term of the loans. The reduced payments would then remain the same for 5 years before gradually reverting back to conforming rates at a maximum of 1 percent per year. Homeowners would also be eligible for a reduction in their loan’s principal(max. $1,000 per year over 5 years) for making payments on time. The program will be available until Dec. 31 of 2012 and homeowners can qualify only once. Investors and speculators will not qualify for the program as the property in question must be owner-occupied.
Likewise, irresponsible borrowers who mis-represented income will be screened out.
Search La Jolla Condos now.

Foreclosures On the Rise in Some Areas of California

Though some major lenders have called for a halt to foreclosures, the number of at-risk homeowners in February rose 30% from last year. Across the country, over 290,000 homeowners were sent default notices last month. This represents a 6% jump from the previous month. Particularly hard-hit are the Western states and Florida, though the dilemma is beginning to be felt in states like Illinois, Idaho, and Oregon. To make matters worse, many experts do not see the problem easing up any time soon.

Many lenders have taken action to help stem the tide of foreclosures. Temporary halt on foreclosures were instituted by mortgage giants Fannie Mae and Freddie Mac as well as major banks Citigroup, Morgan Stanley, Bank of America and JPMorgan Chase. These companies all took action prior to the Obama Administration’s plan to stem the real estate crisis being released last week. In Florida and New York, temporary bans on foreclosures have been lifted, contributing to the rise in foreclosures. Other states are currently pursuing legislation to stem the tide. In Michigan this week the House passed a bill that would grant a 90 day reprieve to homeowners facing foreclosure. The bill now goes to the state’s Senate. As foreclosure numbers keep growing, banks have not listed the properties for sale. There were around 695,000 such home at 2008’s end. Should all these properties be listed, it could cause the housing crisis to persist even longer.

All of this represents a huge challenge for the Obama Administration. The Administration’s plan aims to help more than 8 millon Americans avoid losing their homes. More than 11% of all those paying on a mortgage (almost 5.5 million homeowners) were behind or already facing foreclosure at the end of last year.
That is the biggest number of at-risk homeowners ever. The number is up from 10% in the 3rd quarter and 8% at 2007’s end. A report from RealtyTrac says that almost 75,000 homes were repossessed in February. Foreclosure rates were the highest in the states of California, Arizona, Florida, and Nevada. In Nevada one out of every 70 homes faces a possible foreclosure battle. In Arizona, it’s one out of 147. The other states with top 10 foreclosure rates are Georgia, Michigan, Illinois, Idaho, Ohio and Oregon.

As for metropolitan areas, Las Vegas, with one out of 60 homes facing foreclosure, ranks highest. Second was the Fort Myers-Cape Coral area of Florida. The next six areas with the highest foreclosure rates are all California areas: Stockton, Modesto, Merced, San Bernardino, and Bakersfield. The San Diego real estate market, as well as, the La Jolla real estate market are not seeing as many foreclosures. This has many experts saying that San Diego has already hit bottom.

San Diego’s Home Affordability on the Rise

A recent report from the National Association of Home Builders revealed that almost 45% of homes sold in the last quarter of 2008 in San Diego County were affordable to families earning the county’s median income of just over $72 thousand. The highest such number San Diego has ever reached was in the 1st quarter of ‘94 at just over 48% during the last recession. The new number is up from the 3rd quarter number, slightly below 39%, and a vast improvement over the fourth quarter of 2007, when only 14% of homes sold were affordable. The affordability index is also up across the nation to almost 63%, compared to 56% in the 3rd quarter and almost 47% at the end of last year. An expert commented that the rise in affordability can be attributed to dropping home prices as well as mortgage rates falling. The index makes the assumption that buyers put ten percent down and set aside 28% of net income for insurance, interest, principal, and taxes.

In addition, home prices have continued to drop in the Southern California area. The median price for homes sold in the area currently stands at 250k, an almost 40% drop from January’s median of 415k. San Diego County’s median home price stood at 280k in January, the 1st time in 7 years it has been under 300k, and an almost 35% drop from the same time last year. Experts attribute the trend to increased numbers of foreclosed homes in the area. 55% of all homes sold in the county in January were foreclosed homes.

Home sales are up in the area almost 53% from a year ago, totaling 15,227 homes sold. The 2,459 homes sold in San Diego county represent an almost 35% increase from this time in 2007. As noted by many builders, buyers are benefiting greatly from interest rates dropping. Freddie Mac’s weekly survey reported that the average 30 year fixed rate loan had an interest rate of 5.04%, down from last week’s 5.16% and last year’s 6.04.

Despite falling prices and an encouraging trend in affordability, San Diego still ranks as the 26th least affordable of 222 metro areas ranked by the NAHB. The least affordable market is New York where under 14% of homes sold are affordable to one earning the area’s median income of 63k.

The La Jolla real estate market has remained fairly stable. The median price for a home in La Jolla is about on par with last years numbers. La Jolla condos have also remained fairly consistent in terms of median price and number of units sold.