• Befriend a  neighbor.  A formal Neighborhood Watch program may not be instituted on your block, but you are bound to have a neighbor willing to watch over your home while you are away.  Request that they notify you or the police if something alarming occurs.
• Do not tell the world about your vacation plans until after they are complete.  Your voice mail, Facebook, Twitter, & other social networking websites provide information to sources that may not be your “friend.”  Do not leave notes on your front door, trashcans or mailbox, either.
•  It’s always best when your home appears to be occupied while you are away. Timers and volunteer police patrols can be utilized, and newspapers and mail can be placed on hold, unless you have a large, locking mailbox. You could also ask a friend to visually check-in on your home.
•  Try using a deadbolt or locking mechanism on your garage door while you are away for long periods of time and secure any pet entrances.
• Remember that a well-maintained and well-lit home with timed lights and motion detectors can be a deterrent, as can loud dogs.  Please take note that if you have a pet, you will also need to  plan for its care while vacationing.

When you return, be sure to begin all suspended services again. You will also want to  thank those who watched over your new home so they will feel so inclined when your next vacation comes up.

The National Association of Home Builders (NAHB) and Wells Fargo Housing Opportunity Index (HOI) report that nearly 76% of new and existing homes sold in the last quarter of 2011 could have easily been purchased by buyers earning $64,200 (the national median income). The previous quarter showed nearly 73% of homes in that range, marking a 3% increase.

Interest rates have been at record lows and change weekly on 30-year loans with Freddie Mac reporting an average of 3.87% on February 16th. 15-year loans were averaging 3.16%.  Many housing markets were considered affordable in the recent index, however, if you are in market to purchase a home, the following areas represent the best choice in order of affordability according to the NAHB/HOI:

• Youngstown, Ohio
• Boardman, Ohio
• Warren, Ohio
• Lakeland, Florida
• Winter Haven, Florida
• Modesto, California
• Harrisburg, Pennsylvania
• Carlisle, Pennsylvania
• Toledo, Ohio
• Kokomo, Indiana
• Fairbanks, Alaska
• Cumberland, Maryland
• Lima, Ohio
• Rockford, Illinois

Click on The NAHB/Wells Fargo Housing Opportunity Index: History of Least and Most Affordable Areas spreadsheet located here to download the list of historical data on the most and least affordable areas in your community or browse their website to learn more.

The new agreement, authorized in 49 states (not Oklahoma), strengthens the review process on loan modifications and foreclosures by requiring application reviews prior to beginning the foreclosure process. Excessive fees, insurance costs, and appraisal rates also received limits, and the agreement also provided avenues for principal reduction for struggling homeowners. This agreement does not apply to any FHA, Freddie Mac or Fannie Mae loans or foreclosures.

Homeowners with a mortgage on their primary home that represent a 20 percent or more reduction on property value with a loan balance of less than $417,000 are targeted for these funds, although eligibility will be determined individually. Homeowners whose mortgage rates are above 5.25 percent may be able to refinance to lower interest rates, and homeowners experiencing unemployment or considering short sales may receive aid, as well.

Contact your lender directly to see if you are eligible or watch for a notification letter from your lender within the next six months. Incentives were provided to lenders who completed settlements within 12 months, and funds must be dispersed within three years. Click here to see actual details of the agreement.

This number is anticipated to continue to rise to five times that rate in the next five years with over 30% of “green” home building being forecasted for 2016. Beyond 2016, builders believe over 90% of their projects will be “green.” Home buyers are seeking earth-friendly features in homes for sale, so home sellers and remodelers should take note of these statistics. Renovation work has also increased in recent years, most likely due to the shifting economy, and builders report that home remodels make up over 60% of their business, according to the recent McGraw-Hill study done in conjunction with National Association of Home Builders and Waste Management.

So, home owners and those looking for new homes with eco-friendly perks, have the “green” light! Almost half of builders (46%) have begun marketing their “green” services and are becoming well-versed in determining the best needs and options for their clients. As builders become more familiar with the processes involved with earth-friendly materials, consumer cost has decreased as well, making it a great time to upgrade your home for sale. Benefits of making these eco-friendly measures can be reduced energy costs, reduced waste, better quality of life, and peace of conscience.

To get more information on the results of the Green Home Builders and Remodelers Study, click here.

Fear and uncertainty filled Daniella Baca after she learned that her landlord was facing foreclosure. Those feelings peaked the day the home was sold, when the single mother of two received what seemed like an official letter offering help and then a warning in capital letters: “If you do nothing, you are risking an eviction within 15 to 30 days.”

“It was scary, especially when I saw the (foreclosure) summons even though my name wasn’t on it,” said Baca, 42.

Baca is among the many renters in San Diego County and other areas hit hard by foreclosures who have been targeted with similar panic-inducing fliers. Former homeowners of foreclosures get them, too. What’s more concerning than the doom-and-gloom messages is the erroneous information in the ads, said Steven Kellman, who deals with such issues often at San Diego’s Tenants Legal Center, which he founded. (Kellman also is a member of the U-T San Diego’s Rental Roundtable.)

“They’re filled with misinterpretation,” said Kellman, who said the fliers started popping up about two years ago.

So what are the rights of renters and homeowners living in properties that have been freshly foreclosed upon?

Here are five myths busted:

Myth: The eviction process, also known as unlawful detainer, begins immediately after the foreclosure property has been sold or will be sold at auction.

Fact: Unlawful detainer doesn’t start until your move-out notice expires, Kellman said. If you’re a renter, you’re entitled to at least 90 days in the home or the remainder of your lease, as long as your lease is deemed bona fide as defined by federal law. If you’re the former owner of the home, then you’re entitled to a three-day notice after the foreclosure sale.

Myth: If you pay a company for its post-foreclosure services, they can guarantee you can stay in the home for up to five to nine months.

Fact: There’s nothing in the California law that says that. Again, if you’re a renter, you get a minimum of 90 days, or the remaining time on your lease. It’s three days if you’re the former homeowner.

Myth: You don’t have to pay any rent after a home has been foreclosed upon.

Fact: Neither state nor federal law specifically allow you to stay in a foreclosure property rent-free. But there are banks who are willing to strike deals with homeowners and renters. If you stay in the home for the duration of what’s left on your lease, then the bank steps in as the landlord, and you may have to pay the bank the lease rent. The bank may offer you “cash for keys” to pay you to move, but “one must tread carefully,” Kellman said. “These are filled with conditions.”

Myth: Homeowners and renters who get post-foreclosure solicitations should act on them immediately and start legal processes.

Fact: You should wait until the new owner of the foreclosure contacts you or serves you with papers, Kellman said.

Myth: Any company that produces post-foreclosure paperwork that looks official is licensed to practice law.

Fact: A lot of these companies who say they can negotiate a deal for you with the banks do not have law licenses. How can you find out for sure? The State Bar of California has an attorney look-up site here. Does the company claim to be a real estate office? You can look that up as well, at the Department of Real Estate site here.

Please note: Giving legal advice, preparing legal papers or responding to legal papers should only be done by an attorney who is licensed to practice law and is experienced on matters relating to foreclosures.

Frank Washburn, whose Chula Vista home was foreclosed upon, never saw the red flags. He admits to being duped by one of these post-foreclosure solicitors. His failure to do his homework, he said, cost him $2,500.

Washburn, 45, remembers a man approaching him at his former home to guarantee him more time at his property until he found another place. After Washburn made an initial payment, he was taken to an office to meet a legal assistant. In total, Washburn paid $2,500 to the initial company but was never given any services. His home was foreclosed upon in August. “They play off your hope,” said Washburn, who did not report the incident to any agencies. “You’re wishing for the best.”

Eventually, Washburn found help with the Tenants Legal Center, a company that helped him strike a deal with the bank. The options were stay in the home another 30 days, which gave Washburn no money, or move out within a week and get $1,000. Washburn, who chose the latter, paid the legal center $1,500 for its services.

So, are post-foreclosure solicitors illegal?

That depends on a number of factors, said Kellman, of the Tenants Legal Center in San Diego.

Such companies are illegal if they’re not registered as a business. One way to verify that is by searching the county’s fictitious business name database here. It’s also illegal for companies to offer legal services when they’re not licensed to do so. The same goes for real estate offices that are not registered with the Department of Real Estate. To file a complaint against a company, you can try the Better Business Bureau here.

Other options include emailing the San Diego County District Attorney’s Office at REForm@sdcda.org, or calling the San Diego City Attorney’s office at (619) 533-5600.

By Lily Leung

Friday, February 10, 2012

When a real estate investor sells real estate, a capital gains tax is recognized, along with a tax on deprecation recapture. The regular capital gains tax, deprecation recapture, and any applicable state tax can often result in a tax liability in the 20% to 25% range for the sale of real estate.  (If the real estate has been held for less than 12 months, all of the gain will be taxed at much higher short term capital gains rates.)

A Section 1031 exchange, named for the applicable section of the Internal Revenue Code (also known as a Starker Exchange, Tax Free Exchange, or Like-Kind exchange), allows an investor to defer all tax on the sale of real estate if the real estate is replaced with other real estate pursuant to a detailed set of rules.

The replacement property must be identified within 45 days of the sale of the relinquished property.  (1) The replacement property must be purchased within 180 days of the sale of the relinquished property.  (2) The replacement property must have a purchase price at least as great as the relinquished property, otherwise some tax will be recognized. (3) All of the cash proceeds from the sale of the relinquished property, less any debt repayment and expenses of the sale, must be reinvested in the replacement property. (4) All of the cash proceeds from the sale of the relinquished property must be held by a Qualified Intermediary, which is a person or institution with whom the investor has not recently conducted other business. The investor must not have any access to the cash while it is being held. (5) The titleholder of the relinquished property must be the same as the purchaser of the replacement property. (6) The sale or purchase of a partnership interest does not qualify for a Section 1031 exchange, except under a few limited set of circumstances. (7) The relinquished property cannot have been classified as inventory, such as condominiums built by the investor, or lots in a subdivision that was subdivided by the investor.

If these rules are followed, real estate investors can sell current real estate holdings and replace them with other properties.  A Section 1031 transaction is an excellent way for a retiring real estate investor to convert actively managed properties into passive properties, such as triple net leased properties.

Contact us below if you have any questions or would like more information.  Click here to learn why San Diego is one the top place to invest in.

A Novi Real Estate Company

Broker.CCIM.Realtor
jason@noviproperty.com

Direct 619.417.1658

San Diego Coastal Homes

San Diego Investment Real Estate

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Is your home sending the correct messaage?

If not, it may be time to consider hiring a gardener or getting help from family and friends to make some needed changes as soon as possible. The right gardener can transform the most jungle-like backyard into a beautifully manicured area of peace and tranquility, in as little as a day! With all the other tasks associated with selling your home, landscaping is a great project to outsource.

Before hiring a gardener, ask friends or neighbors for referrals. Once you have a few recommendations, ask questions and raise any concerns you may have with the gardeners/landscapers you decide to interview. Some key points to discuss are how often you would like service and what you need included at each visit. Services range from simple mowing to complete care, with reseeding, watering and fertilizing options. Don’t be afraid to ask your new gardener for help with ideas and improvements that could increase your property value and alert your gardener as to the property status, since there may be times when extra special service is needed (such as before an open house). You might even request that any extra cut blooms be left for you to use inside your home.
Keep in mind that a specialty garden is not the same as basic maintenance. If you have special circumstances, you may want to consider sharing written along with any verbal instructions with your chosen landscaper. Of course maintenance and seasonal costs, liability insurance and worker’s compensation coverage are all topics you will want to discuss before entering into any agreement.

Once you have begun your service, inspect the initial work and take time to notice the changes occurring in your landscaping. As you offer feedback to your gardener and become a part of the process, you will see your home evolve into a well-kept, beautifully groomed masterpiece. Your home will create the best impression possible and deliver the message you want to share with potential home buyers.

If you find yourself in a no-win situation regarding your mortgage, it can be helpful to speak with your lender and ask about modifications that can be made in the short term.  You can ask about the short sale process,  too, and see if that may be a viable option for you.  A short sale is when your lender agrees to accept a lower price than is owed on your property as payment in full.  There is a lot of paperwork that accompanies this type of sale and it is helpful to use a real estate agent that has short sale experience with this type of transaction.  In fact, some real estate agents and home buyers specialize in just this type of sale and can be a great help to you!

If you want to stay in your home, rather than sell, programs such as the Home Affordable Refinance Program (HARP), Home Affordable Modification Program (HAMP) , or the Home Affordable Foreclosure Alternative (HAFA)  offered by Freddie Mac may all be options.  Fannie Mae and your individual lender may have other programs that can assist you as well.  Please click here to view a variety of tools on how to avoid foreclosure.  Remember that you have options, if you are willing, able, and have the time necessary to explore them.  Don’t give up!

Click here to view the embedded video.