Sales of homes in foreclosure by Wells Fargo & Co., JPMorgan Chase & Co. and Citigroup Inc. ground nearly to a halt after regulators revised their orders on treatment of troubled borrowers during the 60 days before they lose their homes.

When it comes to gathering sufficient property taxes, Prop 13 is no problem at all – except for profligate spenders.

Look at the history of my San Diego County – a history which pretty much reflects the history of property taxes in the urban/suburban counties that hold over 85% of California’s population.

According to the SD County Tax Assessor, in 1977 – the year BEFORE Prop 13 took effect (when everything was working great, according to Prop 13 critics) – our countywide property tax revenue was about $639 million.

In the 2011-2012 fiscal year, our county assessor reported real estate property tax revenues of $4.550 BILLION.

For every property tax dollar collected in 1977, the county in 2011-12 collected $7.12.

And BTW, according to the County Assessor, since Prop 13 passed, 97% of the pre-Prop 13 county owner-occupied homes has changed hands (and been reassessed) at least once.

During that time frame, our county population has grown about 85%, and inflation has gone up about 253%. Hence property tax revenues today are substantially higher than the bloated PRE-Prop 13 year, even after adjusting for inflation and population growth.

Read more here:

The UNDER-$1,200,000 Market:

The OVER-$1,200,000 Market:

You can feel it on the street, but a slight slow down only means fewer offers in the bidding wars. We would need a few weeks of reversal before the momentum takes a hit.

The most common packages:

1. The listing agent spoons his lowball short-sale listing to an investor to start the lender-approval process. Agent then finds the retail buyer, and once the investor closes at the lowball price, they sell it to retail buyer and pocket the difference. 

Once a SS investor chimed in here that this is legit because he discloses to the lender that he is buying for the purpose of immediate re-sale for profit. I’m not sure why a bank would agree to that, but we do know that some banks’ short-sale departments are so busy that they will approve sales just to move product, and may not care as much about getting top dollar.

2. The listing agent can’t close the lowball deal so he tacks on a five-figure processing fee or lien-release charge instead. The short-sale processor is complicit though usually paid by buyer so fiduciary conflict there too, though they will claim to be a neutral 3rd party.

3. The investor approcahes the listing agent and agrees to have the LA represent them on the purchase so agent makes 6%. But the investor gets to negotiate the deal with the bank, and they go in ultra-low with or without the agent’s knowledge. If the investor gets it approved, hooray, they put in the standard $15,000 flipper package and make $100,000+ by selling it to the retail buyer they find later. If not, the seller has to start over on a short-sale process before he gets foreclosed.

4. Listing agent appears to expose property to the open market, and fields several offers. Short-sale closes months later for far-under your offer price, and an insider represented the eventual buyer – usually an agent in the same office.

Tell-tale evidence, usually left all over the MLS:

A. The five-second listing, where once the listing is inputted, it is immediately marked pending or contingent.

B. List-price reductions after marked pending/contingent, usually several smaller reductions over months of time.

C. Listing office represents both buyer and seller (listing agent gets a buddy in the office to help diffuse the obvious).

D. None or one photo, or a few terrible photos meant to throw people off the trail.

E. We saw in the news the idea of ‘negative staging’ where they beat up the house prior to appraisal.

F. Widespread abuse of fiduciary duty being inflicted by new and experienced agents, many of whom work at big-name legitimate firms whose managers look the other way.