Best Realty's Lake Oroville Real Estate Blog

As a reader of this blog you know that the market guidance I give for the Lake Oroville real estate market and Paradise real estate market is intended to provide a forward looking perspective to where the market is going.
Attempting to take into consideration all the factors that affect the market and trying to provide accurate guidance into the future is a balancing act to say the least. The biggest challenge in trying to do this is in separating the hype from reality.
Every day you hear the hype but rarely the reality.
I think the reason this Lake Oroville real estate blog is so popular is that readers have realized that the perspective and advice I give is based solely what I see the realities of the market to be. For example, if you go back to some of my previous blog posts you will see that I was maybe the only REALTOR you heard saying that the tax credits would not help the market in the long term; that the market cannot recover until we find a way to get some of the 8 million or so who have been foreclosed on back into the market; and that government “purchase incentives” will only prolong the pain homeowners and sellers are going through with regards to home values.
My contact with two separate buyers in the Lake Oroville real estate market over the past couple of weeks has led me to believe that we are about to see the very small beginnings of a truly sustainable recovery in home sales and home values.
This belief is based on the fact that each of these buyers were coming to me following their homes being foreclosed upon in late 2007 and early 2008.  With FHA lending standards allowing a borrower to get a loan with a foreclosure of 3 or more years old on their credit report, these buyers are poised to get back into the market and find another home to purchase.
With the first big wave of foreclosures rolling through the real estate market in 2008 it stands to reason that there should be the beginnings of an uptick in real estate transactions sometime in the middle of 2011 as many of those who lost their homes may possibly qualify again for a loan.
And as corny as this may sound, with the much lower prices and the almost free, fixed interest rates, many of these buyers may look back on their foreclosure with fond memories as it enabled them to get out of a house they most likely over paid for and which they financed with an adjustable loan with a top rate that would make a loan shark blush.
Time is a great healer, isn’t it?

With the stroke of his pen the President of the United States has extended the deadline for first time home buyers to close their real estate transactions to September 30, 2010.
As with the old deadline, the extension only applies to home buyers that were under contract on or before April 30, 2010.
The extension will allow an estimated 180,000 first time home buyers, many of whom are in the Lake Oroville and Paradise real estate markets, whose loans got caught up in the backlog of files that lenders encountered by being less than prepared for the easily foreseeable crunch of home loans that resulted from buyers making a mad dash to beat the April 30th contract deadline.
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Tuesday Tax Time: the “Home Buyers Credit Extension” Edition  thriveal.com)

This just came across the wires and I wanted to make sure all of you in the Lake Oroville and Paradise Ca real estate markets hear it here first:
(June 29, 2010)—The United States House of Representatives has just passed HR 5623, the Homebuyer Assistance and Improvement Act of 2010, by a vote of 409-5. This bill extends the deadline for closing tax credit eligible transactions from June 30 to September 30, 2010. The bill moves to the Senate where the outcome is much less certain. I will continue to update you as the events move forward.
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Will Congress Extend the Tax Credit Closing Deadline?  blogs.wsj.com)
Today in Congress  dailykos.com)
Extension to Home Buyer Tax Credit Deadlines Resurrected by House of Representatives  findwell.com)
U.S. House Extends Closing Deadline for Homebuyer Tax Credit  businessweek.com)

The United States Senate failed to pass a bill yesterday that, among other things, would have extended the home buyer tax credit until September 30, 2010.
The bill, H.R. 4123, included an amendment allowing home buyers the three-month extension on the tax credit. The extension, though, only applied to buyers who signed purchasing contracts before the original April 30 deadline.
With a backlog of transactions waiting to be processed, and in danger of not closing by the required deadline of June 30, 2010,  the National Association of REALTORS®, as well a mortgage lender groups, had urged Congress to extend the time for escrow closings to the proposed September time frame.
Unfortunately for those of you in the Lake Oroville real estate market and the Paradise real estate market in danger of not closing your transaction on time, the provision for the extension was added as an aside to an unemployment bill that had become a political hot potato.
Why Congress can’t do the common sense thing, (oh wait, my English teacher told me never to use the words Congress and common sense in the same sentence), and vote on these unrelated issue separately is beyond me.
If you are in danger of missing this deadline you might want to turn up the heat on your loan officer, as loan processors and underwriters could really care less about your time frame
There is still an outside chance that this extension amendment and be added to another bill or simply be voted on on its own merits. My advise though is don’t assume anything.
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Tax Credit Extension is Dead in the Water  zillow.com)
Tax Credit Paperwork Extension Denied  rerockstar.com)
200,000 could lose out on homebuyer tax credit  money.cnn.com)

Today’s news that new homes sales are at their worst level in recorded history comes on the heels of yesterday’s report that existing home sales we down more than 2% while the “experts” were expecting an increase of almost 6%, is great example of what I am afraid is going to be another 6 months to a year of pain for sellers and homeowners.  I hope I am wrong , but I fear that I am not.
But, wait!! I thought the government’ s tax credit program was supposed to stabilize the market. If you listened to, and believed what,  the National Association of REALTORS® and the California Association of REALTORS® have had to say about the credits, you should be seeing a recovery by now. But, what we are beginning to see, on a National basis, (which is what most of us read and hear about) is a rapid move of the market toward the place it would have already gone,if  the people who should know better would have been honest about the ultimate impact of these credits they were supporting.
Instead these groups landed on the side of  getting a quick “fix” instead of thinking long term. Now we have to look even longer term because the inevitable has been prolonged.
Now let’s be honest here. I and my office associates, here in the Lake Oroville and Paradise real estate markets,  no doubt benefited from the temporary increase in sales that resulted from the credits. Our sales numbers increased like everyone else’s.  I would, however, have gladly sacrificed the short term benefits in order to re-establish a viable, vibrant and free real estate market. One that has staying power.
As it is we are saddled with the hangover from the housing version of  Cash For Clunkers, or as I prefer to call it:  “Funds For Foreclosures”
If you think that I am all gloomy and doomy about this market you are wrong. I think that expiration of these tax credits now allow us to come back to reality and now focus on the real cause of this market today. UNEMPLOYMENT!!!!!!!!!!!!!!!!
Maybe a softer real estate market going into election season will be one more reason to finally get us the changes we need in order to get  our country’s, and our state’s, economic engine restarted.
As they say, Everything Happens for A Reason.
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Existing Home Sales Drop 2.2%  online.wsj.com)
Housing: How Bad Will It Get?  blogs.wsj.com)
May New-Home Sales Plunge 32.7%  dailyfinance.com)
Calif.’s first-time buyer tax credit almost gone  lansner.ocregister.com)
American Land Title Association Urges Congress to Extend Closing Deadline for Homebuyer Tax Credit  eon.businesswire.com)