Homescopes

Many homeowners believe that if their lender agrees to a short sale, they have no further obligation to the lender.

This is not true!

As the Wall Street Journal reports today, many lenders are being more proactive about going after homeowners for the remaining unpaid balance on loan. For example, if the mortgage balance is $400,000 and the lender agrees to accept $300,000 in a short sale - the lender can ask the homeowner to sign a note for the $100,000 remaining. Other lenders have gone to court to obtain the additional money from other borrower assets.

So be sure you understand what the lender is agreeing to when they approve a short sale. Have your attorney review the agreement or negotiate it for you.

I have written several posts advising homeowners in trouble with their mortgage to consult both their attorney and their CPA before agreeing to a short sale.

The Wall Street Journal has written a good post highlighting the potential tax impacts of doing a short sale.

Homeowners could be tax on the gain in their property even if they do not get any cash out of a short sale which is how they always work. Say someone bought a home for $200,000 several years ago and at some point refinanced for $350,000. The property was then sold via short sale and the lender agreed to take say $300,000 as pay off for the loan. This homeowner could be charged tax on the $100,000 gain since they bought at $200,00 and effectively sold at $300,000.

In addition in the above example, assuming the lender forgives the $50,000 debt not collected through the short sale (lender owed $350,000 and received $300,000), the homeowner will have a taxable income of $50,000.

It is not the intent of this post to give specific concrete advice about short sales but rather just alery everyone that there are complex legal and tax issues that must be dealt with. Do not agree to anything before you get this advice. A mistake here could result in a big tax liability.

I was having a cup of coffee at Peets last weekend and this funky looking road bike caught my eye.  Check out the photo.  With the gnarly mesh-looking frame, the bike looked like it should have been in 1975 classic movie,  Rollerball.  Just imagine … James Caan ripping around an oval track on this thing!

It turns out it is the Ascend road bike created by Delta 7 Sports.  The bike which Delta 7 calls an “IsoTruss” based bike has tubing made of a combination of carbon fiber and Kevlar.  Delta 7 claims the frame is stronger than any bike in its weight class.  I picked the bike up and it was unbelievably light.

Being larger than the average road biker, I questioned whether the bike could withstand my girth.  I tend to bend wheels and such.  He claimed it could and went on to discuss the design of the bike. 

I also wondered whether the open weaving of the tubes would create more wind resistance than a traditional bike.  Apparently, in wind tunnel testing (with head winds), the Ascend road bike had slightly less drag than a comparable sized cylinder frame bike.  I forgot to ask, but I wonder if it was tested in cross winds and what the results were?

The Ascend road bike appears to be lighter and stronger than most road bikes, but at what cost?  I went to the web site and found that suggested retail price for the frame was $5,995. and for a completely built out bike, $10,995.

Kind of pricey, but if you want something light, rigid and strong, it might be the answer.  For now it appears that you can only order them online at http://www.delta7sports.com. 

It’s a great looking bike.  However, I think I would get more enjoyment out of my rides by losing a few LB’s and pocketing the money.  See you on the road and wear your helmet!

This past week in the south Santa Clara County towns of Morgan Hill, San Martin and Gilroy was quite active with a high number of residential sales.  There were 52 residences that went from active to pending status as compared to last week’s 38.  Of all the sales this past week, 48 were single family homes and 4 were townhouses/condominiums.  The highest priced listing sold last week was 9805 Burchell Road in Gilroy, a 10 acre property priced at $1,450,000.  The lowest priced listing sold last week was a short sale condo at 1231 Juniper Dr. #C in Gilroy priced at $97,500.  Sixty-nine percent of the sales this week were priced under $500,000. 

Of these sales, the list price ranges were:

Below $200,000 = 6 sales (11% of total)

$200,000 - $500,000 = 30 sales (58% of total)

$500,000 - $800,000 = 14 sales (27% of total)

$800,000 - $1,200,000 = 1 sale (2% of total)

$1,200,000 - $2,000,000 = 1 sales (2% of total)

As of April 26, 2009, there are 450 residential (single family homes and condos) listings active on the market in Morgan Hill, San Martin and Gilroy.  There are currently 363 pending residential listings.  Therefore, 45% of the total listings are pending under contract as of this date - an amazing amount.  Many of the pendings are short sales and therefore take a long time to close.  This keeps our pending percentage up artificially high. 

Twenty residential real estate listings closed escrow during the past week in the south county towns of Morgan Hill, San Martin and Gilroy.  If homes continued to sell at this rate it would take 22.5 weeks to sell all south county listings.  Therefore we have 5.6 months supply of inventory. 

Tune in next week for an update on the number of sales in South Santa Clara County!

This morning I stepped outside of my house and immediately was taken by a very loud and unusual sound. I looked across the pond to see where the sound was coming from and noticed two large birds that I had never seen before. I grabbed my binoculars, bird book and camera and ...

This is a beautiful neighborhood of spacious homes, many of them with ocean views.  However, buyers haven’t been making their move on this neighborhood for several months.  The last single family home sale in Miramar was in January 2009 - 4 months ago!  That sale was a small 3 bedroom, 2 bath home on a approx. 5,000 square foot lot on the west side, within an easy walk to the coastal trail and beach.  As a bank-owned property, it sold for over-asking price at $432,000.  It’s highest sale price in 2006 was $685,000.  That’s a 36% drop - significant for the Coastside, Half Moon Bay, and the Miramar neighborhood.

I’ve been holding open 365 Coronado, eastside Miramar, for the last several months for the Listing Agent, Margot Lockwood, Coldwell Banker Woodside.  This is a lovely approx. 2600 square foot, 3 bedroom, 2 bath home with tons of light and a great cook’s kitchen with plenty of room for entertaining and work-from-home options.  You can note this home and other homes and property types in this Miramar search link HERE.

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[singlepic=103,320,240,,right]Last week as I was driving to work I noticed a gathering of people along the train tracks with their cameras, I thought to myself there must be a rock star coming through town, who could it be?  As I came into town the tracks were lined with lots of ...

This week’s social networking led me to share this stunning photo of Pillar Point Harbor with you.  If you want to read the story, it’s below the photo.  Otherwise, enjoy this local image in honor of Earth Day (Wednesday)…it just took me a couple more days to get this to you.  Photo taken by Treve Johnson.  Use this link to Treve’s PhotoShelter to purchase photos and gift items from his collection.

It started by my asking a question on LinkedIn to offer my niece some good contacts to assist in her job search following graduation from UCLA this June.  I sent the question to my network, which, by the way, generated several great responses. . .plus I enjoyed hearing from some people I hadn’t chatted with in a few months.  One of those people was Treve Johnson, who I met while working on a high-end property listing a few years ago.  He provided a thoughtful answer to my question, which I provided, along with the others, to my niece.  I clicked on his site and saw a great photo “In Praise of Earth Day” and quickly sent him an email asking if he’d send one of his Half Moon Bay Coastside shots so that I could also honor our little corner of the earth and showcase his talent at the same time.  This waterfront photo is what he sent.  Enjoy.

Thanks Treve!

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After 263 days on the market, the owner of 857 Canis Lane in Foster City has now listed their home with a company called USAuctionAdvantage. The opening bid is $ 300,000. Considering that the last condo was sold for $ 540,000 and didn’t have any of these up-grades, this might be a great opportunity for someone who is comfortable with the disclosures. My understanding is that the HOA has to address a rather large capital improvement project and members have not been able to agree on how to proceed. As a result homeowners who have tried to sell in this beautiful complex have taken a huge hit. According to the website, buyers can bid until May 23, 2009. Follow the current bidding price and # of bids on their website: www.usauctionadvantage.com

A little over a year ago, I set out to earn the GRI designation.  After an intensive 14 course series, I have achieved my goal.  I now can proudly display the nationally recognized GRI designation which I earned from the Graduate Realtor Institute.

Realtors can earn the designation after successfully completing rigorous coursework covering legal issues, financing, technology, pricing and evaluating properties, residential construction, home inspection, land use, environmental hazards, real estate investment, disclosures and taxation issues. 

The Graduate REALTOR® Institute (GRI) designation indicates to buyers, sellers and other real estate industry professionals that I have made the commitment to provide a high level of professional service to my clients by securing a strong educational foundation.

Realtors who have obtained the GRI designation are considered leaders in their profession.

Because buying and selling property has become increasingly complex, a keen understanding of real estate laws, tax issues and market conditions is crucial to the success of your real estate transaction.  As a sophisticated consumer, your transaction deserves the knowledge and professionalism of a GRI.