RE/MAX Lakeside sells Lake Arrowhead Real Estate

Archive for December, 2009

Many of the homes for sale today – as many as half in some markets – fall under the category of “distressed properties.”

These are homes that have either gone through foreclosure or are being marketed as “short sales.” In a short sale, the homeowner can’t afford to maintain the mortgage, but the lender – rather than foreclosing – agrees to the sale of the property for less than the balance of the loan.

These types of sales have different dynamics than traditional sales – with more paperwork, often a longer transaction process and, in some cases, more frustration. For these reasons, many buyers shy away from foreclosures or short sales.

However, if you understand the potential pitfalls of purchasing a distressed property – and work with an agent who has a thorough knowledge of this market – you can get a great home at a great price.

Thousands of RE/MAX agents have been specially trained in working with foreclosures or short sales through the Certified Distressed Property Expert class or a similar course. They can guide you through the process and help you locate and purchase just the right home for you.

Find a RE/MAX agent in your area.

This is an outstanding time to buy a home – distressed property or not. With historically low interest rates, and a glut of homes on the market in most areas, there are bargains to be found. And the U.S. tax credit of up to $8,000 for first-time buyers – good for a home purchased before Dec. 1, 2009 – makes purchasing a home even more attractive.

Is a distressed property for you? Here are pros and cons of buying one.
Advantages of Buying a Distressed Property
First, you’ll be dealing with a highly motivated seller – either a bank in the case of a foreclosure, or in a short sale, sellers who are in financial trouble and very interested in getting out of a mortgage they can no longer afford.

These types of sales take much of the emotion out of the process. You won’t be insulting anybody, for instance, if you make an offer that’s lower than the asking price. (That’s not to say that the low offer will necessarily be accepted, of course.)

Lenders are extremely interested in getting these homes sold and off the liability side of their balance sheets. Many foreclosed properties can be purchased for only a percentage of what they would have commanded five years ago. (This situation is beginning to change, though; bidding wars are breaking out on some foreclosed properties these days, especially those that are moderately priced. Your RE/MAX agent will know what’s going on in this area and will be able to help you arrive at a reasonable strategy for making an offer.)

If you’re looking at a short sale, you’re not likely to get quite as good a deal as on a foreclosure. But there are definite advantages to purchasing one of these homes. For one thing, since the homeowners want to get the home sold quickly, they are likely to keep it well-maintained and in good move-in condition.
Disadvantages of Purchasing a Distressed Property
If you’re looking for a “steal,” you’re probably not going to find it. The market is heating up, with more and more buyers jumping into the market. If you’re purchasing a home to live in, you’ll often be competing not only against buyers similar to yourself, but against investors. More competition inevitably leads to higher prices.

The transaction process for short sales or foreclosures often takes longer than for traditional transactions. It’s sometimes not clear which lending institution actually owns a mortgage loan, and it can take time to get it all sorted out – especially if there’s a second mortgage involved, which is often the case.

Some foreclosed properties are also in rough condition. Many have sat idle for a long time with minimal or no maintenance. The departing owners may have sold off fixtures, or damaged the property.

Interested in searching for foreclosures in your area? Access the Foreclosed Properties database here on remax.com.
Purchasing Tips
It’s critical to have the home professionally inspected before you make an offer or put down earnest money. The inspector will assess the structure’s soundness and may uncover problems that would be very costly to repair. Banks usually sell foreclosed homes as-is, meaning they won’t make any allowances for repair. And even in a short sale, they likely won’t make any such allowances, because they’re already losing money on the transaction.

You should have your financing in order before pursuing a foreclosure purchase. Pre-approved buyers have the best chance of getting the property in case of multiple offers. Also, banks generally aren’t interested in contingencies (for instance, needing to sell your current home before purchasing another).

You might also consider hiring an appraiser who’ll tell you what the house is worth. A RE/MAX agent can also perform a Comparative Market Analysis.

To guide you through the process – from obtaining a loan to identifying a home, to negotiating with the sellers (whether homeowners or banks), to closing – contact a RE/MAX agent.

Mortgage and foreclosure terms defined.
Distressed Properties and FHA Loans
If you’re a first-time homebuyer, a federally insured FHA (Federal Housing Administration) loan might be a good option. The FHA has a program to help you repair a fixer-upper. You can get one loan that combines the mortgage with the repair costs. The amount of the loan is based on the projected value of the property once repairs are made.

FHA loans only require a 3.5 percent down payment – compared to 20 percent with conventional loans – and the down payment can come from an employer, family member or charitable organization. FHA loans also have lower closing costs than conventional mortgages.

Since the federal government insures these loans, you’ll get a competitive interest rate and lenders may be willing to give you terms that make it easier to qualify for a loan. If you have less-than-perfect credit, it’s easier to obtain an FHA loan than a conventional mortgage.

According to the California Association of Realtors; California’s New Home Market Breaks into Positive territory

•· Survey finds most agents see home prices stabilizing

•· California new home sales rise 25%

•· Foreclosure activity declines 8% nationwide

Survey finds most agents see home prices stabilizing

According to the recent survey, Home Gain members said that 37 percent of home buyers believe that homes for sale are fairly priced or under priced compared with 36 percent in the third quarter. Conversely, 41 percent of homeowners think their homes should be listed 10 percent to 20 percent higher than what their agents recommend, up from 38 percent in the third quarter.

The first-time home buyer tax credit has helped drive sales, with 21 percent of respondents saying half of their transactions involved a first-time home buyer, with only 11 percent noting that none of their transactions involved a first-time home buyer.for more info

California new-home sales rise 25 percent
Sales in new-home communities of 10 units or more in California rose 25 percent in October compared with a year ago, according to the monthly California Building Industry Association (CBIA)/Hanley Wood Market Intelligence report. The increase marked the first year-to-year sales appreciation since December 2006, according to CBIA. Sales of single-family homes increased 4 percent, while sales of town homes and multiple-unit homes rose 36 percent. Condominium sales increased 94 percent compared with a year ago, according to the report.
“While this month’s figures are encouraging, we must keep in mind that we’re comparing the figures to October of 2008, which was the second lowest month of nominal sales we’ve seen during the downturn,” said Jonathan Dienhart, director of published research for Hanley Wood Market Intelligence. for more info

Foreclosure activity declines 8 percent nationwide

California posted the nation’s third highest foreclosure rate, with one in every 180 housing units receiving a foreclosure filing in November. Despite a 13-percent decrease in foreclosure activity from the previous month, California continued to post the highest total of any state, with 73,995 properties receiving a foreclosure filing in November. Foreclosures in California rose 22 percent from November 2008, but were down nearly 32 percent from a July peak of 108,104. November marked the fourth consecutive month that California foreclosure activity has declined on a month-over-month basis. for more info

Every year The Lake Arrowhead Community celebrates the season by hosting various activities and Events for visitors and locals alike. Whether you are planning to visit Lake Arrowhead for a day, looking to relocate permanently or you’re a local searching for some great activities this holiday season keep reading for a few great ideas.

A Christmas Carol – December 17, 18, 19 2009. Join the Lake Arrowhead Repertory Theatre Company classic “A Christmas Carol” by Charles Dickens. This play will be held at the theater in Crestline. Call 909-744-8114 for more information or visit www.lakearrowheadrep.org

Mountain Skies Astronomical Society – December 19, 2009 7pm-9pm. Enjoy an evening at the MSAS Astronomy Village as they visit “The Planets of our solar system” MSAS Astronomy Village is located at 2001 Observation Way off HWY.18 (West of Rim of the World High) Call 909-336-1699 or visit their website www.mountain-skies.org

Historical Society Museum- December 20, 2009 1pm-4pm. Visit with Santa at the Santa’s Village Exhibit at The Rim of The World Historical Society Museum located at 27176 Peninsula Dr. In Lake Arrowhead. Santa will be at the Museum Sunday December 20 from 1pm to 4pm. Children are encouraged to write a letter to Santa & he promises to answer each one of them!Call 336-6666 or visit www.rimoftheworldhistory.com for more information.

Lakeside wishes you and you’re family a very Happy Holiday!

RE/MAX Lakeside – 1031 Exchange and what you need to know….

Internal Revenue Code 1031 is a powerful tool for deferring capital gains tax on commercial/investment transactions. This section allows taxpayers to exchange real or personal property for new “Like-Kind” property, while deferring recognition of any capital gains.

Section 1031 creates the ability for you to defer capital gains on commercial/investment transactions by placing your sale proceeds with a “Qualified Intermediary” for up to 180 days until the closing of the purchae of the replacement property.

The most commonly used tax-deferral strategy is the Forward Delayed Exchange. In a typical Delayed Exchange, the taxpayer sells a business or investment property and acquires replacement property of equal or greater value within 180 days. The use of the Exchange Service is required to facilitate a valid tax-deferred exchange.

Before you begin the exchange process, be sure to consult your accountant or financial advisor to insure that a 1031 exchange is right for you.

Step One: Sale of the relinquished Property

Step Two: Identification of the Replacement Property. The Exchanger must identify the property to be purchased within 45 days following the sale of the Relinquished Property.

Step Three: Purchase of the Replacement Property. The Exchanger must obtain the Replacement Property within 180 days following the sale of the Relinquished Property.

FOR MORE INFORMATION GO TO: WWW.IRE.GOV

RE/MAX Lakeside: YOUR CERTIFIED DISTRESSED PROPERTY EXPERTS!

Distressed properties exist in all market segments in all price points and in every state in the country. With foreclosures at an all time high and expected to get even higher there is no category of residential property that will not be affected.

The overwhelming challenge in the residential market will soon begin to affect the commercial property and as commercial becomes an issue more residential will be an issue. This spiral downward in property values will take time to play itself out at which point we will see stabilization in the market.

What is a distressed property?

1. Property that is or will soon be in some stage of the foreclosure process.

2. Property owned by a person or persons who are or are experiencing a period of financial instability.

3. Property of which the mortgages totals an amount higher than the current value and an owner must sell.

In 2006 there were a total of over 1.2 million foreclosure filings nationally, this equated 1 out of 92 households nationally and in California there were 1 out of 86 homes. In the first quarter of 2007 foreclosure activity was up 55% from 2006 with a total of 925,986 filings in only the first 6 months of the year.

If you fall into one of the categories above you need to contact RE/MAX Lakeside and speak with one of our CERTIFIED DISTRESS PROEPRTY EXPERTS today. We specialize in handling

Contact RE/MAX Lakeside at 909-337-9999 for more information about Distressed Properties.

Winter Wonderland

Being a Lake Arrowhead resident offers many perks. When you live in Lake Arrowhead you have many options when it comes to out door activities. Fresh air, exquisite beauty combined with welcoming local residents, its no wonder Lake Arrowhead has been deemed the Jewel of Southern California. There are countless ways to enjoy this unspoiled mountain retreat. Each Season exposes the beauty of Lake Arrowhead’s landscape.

Winter is knocking on the door and that means snow! Yes, very soon Lake Arrowhead will turn into a winter wonderland. There is no better advertising than a snow capped mountain on a sunny day. Lake Arrowhead is only 25 minutes away from great snow skiing and cross country Skiing. Snow Valley Ski Resort, Bear Mountain and Snow Summit all offer an impressive and convenient choice for Snow lovers visiting the Arrowhead Area.