Bakersfield Real Estate - bakersfieldrealestate's Blog - Bakersfield.com

Karpe Diem, Ray Karpe leaves Karpe Real Estate. Will he Seize the Day?

Thu, 12 Nov 2009 17:20:37 PST

Ray Karpe has left Karpe Real Estate, the company founded by his ancestors that has had a Karpe at the helm for the whole of its 86 years. Word is he is leaving Real Estate, and if so, he will be missed. Karpe Real Estate will carry on, but I guess they will have to re-shoot their commercials featuring Ray Karpe.

I have been wanting to use Karpe Diem as a headline ever since I studied the novel Carpe Diem by Saul Bellow in college. Carpe Diem is Latin for "Seize the Day." I went to Amazon to see if their were any good reviews of Carpe Diem but it is out of print, except in Spanish. I remember that it was a good short novel, and the title may have been intended to be ironic since the 'hero' was kind of a slacker who poured coca-cola on his breakfast cereal. Sad to see that it is currently unavailable, though there should be lots of used copies in bookstores around college campuses.

THE FEDERAL HOMEBUYERS TAX CREDIT HAS BEEN EXTENDED AND EXPANDED

Fri, 06 Nov 2009 15:18:01 PST

THE FEDERAL HOMEBUYERS TAX CREDIT HAS BEEN EXTENDED AND EXPANDED

The extended Federal tax credit for first-time homebuyers remains 10% of sales price up to $8,000

The new Federal tax credit for move-up homebuyers, who have used their previous home as a principal residence for five of the previous eight years is $6,500

The income level to qualify is $125,000 for single filers or $250,000 for joint filers

The maximum eligible home price has been increased to $800,000

The Federal tax credit runs from December 1, 2009 to April 30, 2010

Sales contracts signed as of April 30, 2010 must close by June 30, 2010

*Contact your tax advisor for full details.

Further Details about this and other bills signed into law today in the Washington Post article

Have a Safe and Happy Halloween!

Fri, 30 Oct 2009 14:47:29 PDT

Here are some Trick or Treaters who came by our office at 3400 Calloway Drive, Building 800, Bakersfield, CA 93312. We still have lots of candy for the kids and will be open until 6 PM.

I love to see the kids, but sometimes they look like they are more afraid of us than we are of them in their costumes.

We are at the corner of Calloway and Meacham in the Northeast corner business park. It is just West of Endeavour Elementary School.

McKinzie Nielsen Real Estate wishes everyone a safe and Happy Halloween!

Caravan in Northwest Bakersfield

Fri, 23 Oct 2009 13:05:18 PDT

Something Borrowed, Something Blue, Vol. I

Wed, 21 Oct 2009 17:51:21 PDT

When a bride gets married, there is an old saying that she should wear something old, something new, something borrowed, and something blue. In England they also say "and a six pence in her shoe." Sometimes for luck, they actually do put a six pence in her shoe.

I am calling this BLOG Something Borrowed, Something Blue, and will try to update about lender issues every other Wednesday. It is a subset of my regular blog.

I was having lunch with Helen Thomas--not the White House reporter, a local lender. She had a lot of interesting predictions about what is coming down the pike.

First, there were rumors that FHA solvency is shakey, but they are unfounded.

HUD will adopt some sort of HVCC (Home Valuation Code of Conduct) plan by January 1st.

Will the $8,000 tax credit be extended? 93% likelihood. This might not happen by December 1st, but if it does it will probably be retroactive.

Will it increase to $15,000? Only a 30% likelihood of this happening.

Will the tax credit be offered to all purchasers, not just First Time Home Buyers? There is a 60% likelihood.

Fannie and Freddie are very tight lipped about how much inventory they have and when and how it will be released.

Government is currently buying ALL mortgage backed securities. 100% of new securities and also some old, non-performing securities owned by banks taken over by FDIC, and other various institutions. This is keeping the interest rates low, which is encouraging people to buy houses.

This will stop after the 1st quarter of next year--expect rates to go up least .75% to 1% by March of next year. This will happen in February or March. Helen was very sure about this, but of course, no one really knows the future. Still, it is a pretty good bet.

Was the Kern County Fair the Best in the West?

Thu, 15 Oct 2009 19:16:57 PDT

Did anybody have a good time at the Fair? I helped build a house for Habitat for Humanity. I saw the Cowgirl competition, and my niece's friend won 5th place. I saw the livestock and a hog auction. I had some funnel cake and some BBQ. I didn't see Grand Funk Railroad.

Blogging about blogging

Wed, 09 Sep 2009 18:20:57 PDT

I am trying to write a blog but it keeps disappearing. I am going to the Bakersfield Jazz Workshop. I am writing this from a laptop and mobile Internet connection in Starbucks. Just when I am getting somewhere and have almost finished then my post keeps disappearing. I am going to write them in a text program and then cut and paste them into the blog. The new Beatles remastered is out now and they are playing it here. OK, I am going to post this and then I will write more later, about Real Estate, even.

The Southwest Stats

Fri, 09 Jan 2009 12:56:04 PST

What is Happening in Southwest Bakersfield Real Estate?

I just did a little analysis of what is up in Southwest Bakersfield Real Estate. By Southwest Bakersfield, I mean the area West of Gosford Road, East of Allen Road, South of the Kern River, and North of Houghton Road. In that part of Bakersfield, there are 216 houses for sale in the Bakersfield MLS. Of those, 68 are foreclosure properties (REO), 73 are Short Sales, and 75 are traditional sales. In December of 2008 67 houses sold, and 40 of the sales were forclosure properties, 22 were traditional sales, and only 5 Short Sales actually closed. The odds for Short Sales actually closing don't look so good, but there is quite a bit of activity for the foreclosure properties. Some people think this isn't such a great time to buy, betting that the prices will go down even more, but others are taking advantage of the low interest rates available, and prices that are pretty low, even if they haven't hit the ultimate bottom.

Some other interesting factoids about Southwest Bakersfield Real Estate:

The Median Price of the homes sold in December of 2008 is $240,000.

Two years ago, in December of 2006, the Median Price was $352,500.

The peak Median Price was January of 2007, when it was $390,075.

Over the past 2 years, September of 2008 had the most sales with 89.

Over the past 2 years, the highest number of For Sales Properties was in October of 2007, with 597.

If the present rate of sales continues, there is a 4-Month Supply of Inventory.

Chris Craddock
REALTOR®

The Key to Bakersfield Real Estate

McKinzie Nielsen Real Estate
3400 Calloway Drive, Building 800
Bakersfield, CA 93312

Direct: (661) 410-4467
Cell: (661) 900-2222
Fax: (661) 410-4439
Email: CRC@ChrisCraddockRealtor.com

www.ChrisCraddockRealtor.com

Black Friday and Cyber Monday

Mon, 01 Dec 2008 17:32:44 PST

How was your Thanksgiving? Did you eat a lot of turkey, watch football, and fall asleep? You are not alone. Did you go shopping the next day, taking advantage of big sales for the opening of Christmas shopping season? If so, then you were not alone there, either.

In fact, the Friday after Thanksgiving has been called Black Friday because of the heavy traffic it generates. The term originated in Philadelphia in the 60's, but then during the 80's it morphed into explaining the name, "Black Friday," as being due to the fact that so many retailers depend on Holiday shopping to take them out of the "Red" and into the "Black." In traditional accounting red ink shows losses and black ink is for profits.

Though this is a less negative way of looking at it, for Retail Store employees, bus drivers, cab drivers, and police, the original meaning is likely to resonate.

In many cities it is not uncommon to see shoppers lined up hours before stores with big sales open. Once inside, shoppers often behave like pirahnas in a feeding frenzy, as many stores have only a few of the "door busters," the big draw items. On occasion, injuries and even fatalities are reported; last Friday, a worker at a Wal-Mart in Valley Stream, New York was trampled to death by shoppers who broke through the store's glass doors minutes before the store's scheduled opening at 5:00 am; a pregnant mother was hospitalized from injuries in the same human "stampede", though early reports of a resultant miscarriage were determined to be in error. And in Palm Desert, California two people shot and killed each other after arguing over an item in a Toys R Us store.

For economists looking to see how the Holiday Shopping Season would do, Black Friday had a higher turn out than expected. But they still expect sales to be way down this year.

Today, or the Monday after Thanksgiving, is now being referred to as "Cyber Monday." That is because workers returning to the office on Monday often use the broad band available on their work computers to do online shopping. Cyber Monday is getting to be less dramatic as more consumers have broadband at home, and don't have to depend on their office computers for online shopping. People are getting a jump on Cyber Monday by starting to shop online on Thanksgiving. Online Shopping is getting bigger every year, and there are lots of sales and incentives to get people on there. It is fairly easy to find free shipping, and other discounts.

So, there are lots of bargains out there, but be careful, both online and off!!!!!

Happy Holidays,

Chris Craddock, Realtor

The Key to Bakersfield Real Estate

Chris@ChrisCraddockRealtor.com

http://www.ChrisCraddockRealtor.com

Que Pasa, Bakersfield?

Fri, 21 Nov 2008 18:34:46 PST

Que Pasa Bakersfield?

Come down to Que Pasa at 5303 Olive Drive, Bakersfield, CA 93308, this Sunday at 4:30 PM, November 23rd, 2008. Our Real Estate Office is having a wrap party for our Open House Extravaganza. We are doing 9 open houses this Sunday, and afterwards we are all going to meet up at Que Pasa!!!!!

If you would like to go to open houses, you can search for them here. We have some from our office and from several other offices as well.

Adios, amigos and amigas!

Chris Craddock, REALTOR

The Key to Bakersfield Real Estate

(661) 900-2222

CRC@ChrisCraddockRealtor.com

www.ChrisCraddockRealtor.com

Brother, Can You Spare a Dime?

Sat, 15 Nov 2008 17:47:01 PST

On September 5th, 1929, my father was born. On Oct. 29, 1929, the U.S. stock market crashed. America's economy collapsed, pulling many international markets down with it. It was the beginning of the Great Depression: an era of long bread lines, bankruptcies and hungry Dust Bowl sharecroppers that would last through most of the 1930s.

In 1932, a young New York City lyricist named E.Y. "Yip" Harburg, together with composer Jay Gorney, wrote what is considered the anthem of the Great Depression, "Brother, Can You Spare a Dime?"

National Public Radio did an excellent piece on the song. Read all about it at the links below. You can also hear several versions of the song, by Tom Waits, Abby Lincoln with Stan Getz, Bing Crosby, Rudy Valee, and even an a capella version by political commentator Daniel Schoor.

For my money, the best version is by Paul Desmond and Dave Brubeck. Desmond played alto sax with a tone that was akin to a dry martini. His best known tune is "Take Five," written in an odd 5/4 time signature. He attended San Francisco State, my alma matter. He played a Selmer 'Super Balanced Action' saxophone - serial number 43xxx manufactured in 1950. His saxophone was fitted with either a Gregory Hollywood Model A, 4A18M or Claude Lakey 5*3[1] mouthpiece fitted with Rico 3.5 hardness reeds. My dad played the piano, and later when he retired, the soprano saxophone. I remember the album, Brubeck Time, that features "Brother, Can You Spare a Dime?" and associate it with my father.

Composer Jay Gorney based the plaintive minor melody on a Polish lullaby from his grandmother. Lyricist E.Y. "Yip" Harburg is perhaps best known for "Somewhere Over the Rainbow" that he wrote with composer Harold Arlen. "Brother, Can You Spare a Dime?" would seem to be quite a topical tune as relevant as ever, were it not for inflation and the fact that a dime wouldn't get very far in today's economy.

http://www.npr.org/music/

http://www.npr.org/soapbox/

http://www.npr.org/blogs/sundaysoapbox/2008/11/brother_can_you_spare_a_dime.html

http://www.npr.org/templates/story/story.php?storyId=96654742

Anne Hathaway is the new "It" girl!

Fri, 14 Nov 2008 15:22:33 PST

Anne Hathaway is the new "It" girl!

I was reading an article about how Anne Hathaway is the new 'It' girl, and I'm inclined to agree:

" 'IT' is that quality possessed by some which draws all others with its magnetic force. With 'IT' you win all men if you are a woman -- all women if you are a man. 'IT' can be a quality of the mind as well as a physical attraction."

That's how Elinor Glyn defined the term "it-girl," a term that entered the lexicon with the 1927 film "It," based on one of the English Romance Novelist's books starring Clara Bow, original 'It' girl extraordinaire.

Hathaway can do comedy, as evidenced by her turn as Agent 99 in the "Get Smart" remake, as well as drama, as evidenced by her role as an addict on furlough to see her sister's wedding in "Rachel Getting Married." By the way, Debra Winger, a former 'It' Girl herself, also does a bang up job in "Rachel Getting Married." It is her best role since she donned her Wonder Girl costume for that prank on Letterman.

Rachel Abramowitz makes the case for Hathaway's 'It'ness, and you can read all about it down here:

http://www.latimes.com/entertainment/news/la-et-hathaway14-2008nov14,0,7206801.story

If you are looking for something to do tonight, why not go to the Fox Theater on H St and see the Austrian film, "The Counterfeiters." It is the winner of this year's Academy Award for Best Foreign Film, and tells the true story of Salomon Sorowitsch, a counterfeiter captured by the Nazis, who is forced to counterfeit money to help finance the war effort. The show, part of the Flics series of film screenings, starts tonight, Friday, November 14th, at 7:30 PM.

For more information about this or other films, check this link down here.

www.flics.org

The Key to Bakersfield Real Estate
Chris Craddock, Realtor

www.ChrisCraddockRealtor.com

Tippecanoe and Tyler, Too!

Thu, 13 Nov 2008 16:17:15 PST

The recent election got me thinking about the campaign slogan "Tippecanoe and Tyler, Too!" This catchy ditty was also one of the first campaign songs. As you may know, Tippecanoe was the nickname of our 9th President, William Henry Harrison, who served only 32 days as he caught pneumonia after giving his inaugeration speech in the rain. He was succeeded by his Vice President, John Tyler, our 10th President.

Though you might guess that he got the nickname "Tippecanoe" from a canoe that was prone to capsize, it was actually the name of the place where an historic battle was fought in Indiana in 1811. The name is an anglicization of "Kethtippecanoogi", a Miami term meaning "place of the succor fish people."
(Kriebel, Robert C. - Tippecanoe at 2000: A Hoosier County Recalls Its Past).

As Governor of the Indiana territories, William Henry Harrison led the charge against the Indian tribes who were resisting Western expansion. The tribes were led by Tecumseh, whose name meant "Panther in the Sky." Now the story gets weird. Tecumseh or his brother Tenskwatawa (also known as "the Prophet") laid a curse on Harrison (or so the legend goes), who died in office, and every twenty years thereafter the President who was elected in that year died in office; and the curse held up to Ronald Reagan, who was elected in 1980, but didn't die in office--though he was shot by John Hinckley Jr. in an unsuccessful assassination attempt. The jinx was broken, and George W. Bush, selected in 2000, did not die in office, either. One President, Zachary Taylor, also died in office, but he was not elected in one of the 20 year cycles that fit the pattern.

The 'curse' was first mentioned in a 1931 Ripley's Believe It Or Not, and then again in a similar weird cartoon feature called Strange As It Seems published just before the election in 1940.

The Presidents in the line of Tecumseh's Curse

1840: William Henry Harrison died of pneumonia on 1841-04-04
1860: Abraham Lincoln was assassinated and died on 1865-04-15
1880: James A. Garfield was assassinated and died on 1881-09-19
1900: William McKinley was assassinated and died 1901-09-14
1920: Warren G. Harding died of an undetermined cause, either heart attack, stroke, or possibly poison on 1923-08-02
1940: Franklin D. Roosevelt died of a cerebral hemorrhage on 1945-04-12
1960: John F. Kennedy was assassinated and died on 1963-11-22

Though this pattern held up for 120 years, both Reagan and George W. Bush have escaped it, and President Elect Obama was not elected on a 20 year cycle, and wouldn't be a part of the curse in any event.

If you are interested in the history of Presidents past, the Whitehouse has some information at their website:

http://www.whitehouse.gov/history/presidents/chronological.html

For some other thought provoking information about what more recent Presidents accomplished during their first 100 days in office, check out this chart from Good Magazine:

http://awesome.goodmagazine.com/goodsheet/goodsheet009First100Days.html

Good Magazine can be found at this URL:

http://www.good.is/

Chris Craddock, Realtor
The Key to Bakersfield Real Estate

www.ChrisCraddockRealtor.com

Winslow the Coyote goes back to Real Estate

Wed, 12 Nov 2008 14:05:37 PST

Prickly City, a syndicated comic strip that runs in the LA Times (but not the Bakersfield Californian) has started a new story arc where Winslow, a coyote, is going back to his career in Real Estate now that the election is over. You see, Winslow and Carmen, a young conservative girl, were running for President and Vice President. But that well of humor has apparantly run dry for Scott Stantis, the author of Prickly City, because for now and the foreseeable future he will be skewering Real Estate. The Real Estate angle began on November 10th, 2008, and you can see the comic strip and follow it here:

http://www.gocomics.com/pricklycity/2008/11/10/

The Bakersfield Californian should consider running this strip, because it would be perfect for Bakersfield as it follows the Conservative Political Talking Points. Now that the Bakersfield Californians are charging 75 cents at the news stand, they should be able to afford it.

Indeed, I tried to pick up the LA Times the other day at my usual location--The 7-11 at Calloway Drive and Hageman Road. Sure, they charge 54 cents, the 4 cents are sales tax, which you don't have to pay if you buy it from a news rack, but it is conveniently located near the new Starbucks at Calloway and Hageman, at 9801 Hageman Rd. But they were sold out of the LA Times at the Seven Eleven, I am thinking because a lot of Bakersfield Californian readers decided they didn't want to pay the extra quarter and switched.

Anyway, if you want to follow the whacky antics of a right wing coyote named Winslow in Real Estate, you can either follow it online or switch to the LA Times. Or ask the Californian to run Prickly City, and have it home delivered at a substantial savings compared to the newsrack cost.

As Eagles would say, "Well, I'm standing on a corner in Winslow, Arizona, and it's such a fine sight to see. It's a girl, my lord, in a flat bed Ford, slowing down to take a look at me..."

Take it Easy.

The Key to Bakersfield Real Estate is
Chris Craddock, Realtor.

www.ChrisCraddockRealtor.com

Economic Forecast and market data for 93312 and 93307

Tue, 11 Nov 2008 17:06:02 PST

Today I went to an Economic Forecast regarding the housing market in Bakersfield and Kern County. It was given by Leslie Appleton-Young who is the resident economist for the California Association of Realtors. I will go into the forecast latter, when I receive the PowerPoint from her presentation, but for now, I would like to show you some charts I made for Bakersfield zip codes 93312 and 93307. These two zip codes are the two zip codes that have the most activity right now. 93307 because it is also the zip code with the most foreclosures, which is where a lot of the action is coming from.

What these 4 charts show is the Supply versus the Demand and the Months Supply of Inventory, AKA the Absorbtion Rate. What that means is, how long, at the present rate of sales, would it take to burn through the glut of inventory? You take the number of sales and divide it into the number of houses on the market. As Jethro Clampett would say, 'the goes into's".

93312 is doing pretty well, in fact, it is getting to be balanced, leaning a little bit to "Seller's Market." In September of 2007 we had 14.8 months of houses in 93312, but now in October of 2008 we are down to 2.8 months, the lowest it has been in the past 2 years. 132 "units" sold, with 530 "units" still on the market.

93307 is down to a 4 "Months Supply of Inventory" or MSI. A little higher than 93312's MSI of 2.8, but still a lot lower than the peak of 34.3 months supply in December of 2007. In October there were 530 "units" and 132 "units" were sold in October of 2008.

Anyway, things are improving in the Bakersfield housing sector, and that is good news what with all the other economic uncertainty on the horizon. Back in December of 2008 with 480 houses for sale in 93307 and only 14 sold, it looked like it would take 3 years to burn through them. Now, less than a year later, we are down to 4 months.

Microchip Locates Lost Dog, Mojo from Delano

Mon, 10 Nov 2008 17:38:37 PST

My friend Viki teaches at South High, and students are always bringing her stray dogs that wander onto campus. We are both at capacity, and can't take any more strays in, but we have kept some temporarily until we could find new homes for them, or return them to the rightful owners.

The latest dog was quite a handful--we called him Barkley, for obvious reasons. It wasn't his fault, but all of our other dogs hazed him, and ganged up on him, not to mention the cats. He was really a sweet guy but he had no choice but to stick up for himself.

I took him to the SPCA but they were full. Luckily, they said they could scan him for a microchip, and we hit the jack pot. The SPCA called the owners, who lived in Delano, and had been searching for Mojo. So, that was his name: Mojo. I am going to miss Mojo, but Dusty, Delilah, Miles, Lester, William J. Shakespeare, Francis, Tyger, Felix, Raskind, and Samantha are relieved. It was getting a little crowded.

I wonder how he traveled all the way from Delano to South High in Bakersfield, but thanks to some amazing grace and a little microchip, he once was lost, but now is found. It is a good idea to get your pets microchipped. I have had several close calls with Delilah, who seems to think it is all some kind of game, and goes for a frolic whenever she slips out of her collar or slips out the gate. She does a little dance, and thinks it is the funniest thing to have me chase her all over town. I think the SPCA only charges $15 for a microchip.

Their address is:

3000 Gibson Street
Bakersfield, CA 93308

(661) 323-8353

www.bakersfieldspca.org

Halloween at McKinzie Nielsen

Fri, 31 Oct 2008 13:46:51 PDT

Some kids are already trick or treating at our office. We still have lots of treats left, and we are open until 6:00 PM.

Have a safe and fun Halloween!

What is up in Bakersfield Real Estate with the HUD's and REO's?

Fri, 10 Oct 2008 15:50:32 PDT

I just compiled a new list of REO properties. If you are interested, drop by, call or email me. I have added HUD properties, which are kind of like foreclosures, but of government loans. There are only about 16 listed in the Bakersfield MLS right now--some in Bakersfield and some in Tehachapi, Mojave, Delano, etc. That number could be growing, especially if the Bail Out or any subsequent attempts to revive our economy involve buying mortgages.

Anyway, the HUD homes might become a bigger story in the future, but for now only a few brokers have signed up as HUD brokers. This is a requirement to make offers on HUD homes. Only the HUD brokers have access to the HUD keys, so if you want to see one of these properties, you will need to use a HUD broker.

For further information on HUD homes, go to their website:

www.HudPemco.com

How many REO (bank-owned, forclosure) properties are on the market in Bakersfield right now, on October 10, 2008?
1,213, with an additional 194 from nearby towns that list in the Bakersfield MLS.

Broken down by zip codes, there are
      10 in 93301,
     142 in 93304,
      81 in 93305,
     181 in 93306,
     229 in 93307,
     107 in 93308,
     156 in 93309,
      65 in 93311,
      93 in 93312,
     111 in 93313, and
      34 in 93314.

Of the 3,324 houses listed in Bakersfield right now,

1,213 REO's = 36%
957 Short Sales = 29%
1,154 Traditional Sales = 35%

Is it a Buyer's or a Seller's Market?

Tue, 07 Oct 2008 16:27:50 PDT

As a Real Estate Agent in Bakersfield, California I am interested in spotting trends, both nationwide and locally. One good test of whether we are in a Buyer's or a Seller's market is called the Absorption Rate. That means looking at the inventory of homes, seeing how many sold in the past month, then dividing the total inventory by the amount sold. This gives you an idea of how many months it would take to sell off all the houses at the current pace of sales if no new homes went on the market. Though the numbers are constantly changing, and this model is a simplification of what is going on, it can nevertheless give you a really good idea of what is going on. The tipping point between a Buyer's or a Seller's Market is 6 months. If it would take longer than 6 months to sell off all the available houses, then the market is saturated, and that favors the Buyer. Sellers are the Supply, and Buyers are the Demand. If it would take less than 6 months, then the Sellers have an advantage, according to the Law of Supply and Demand.

In a Buyer's Market, if you find a motivated Seller, who really wants to Sell, or has to Sell, you can make low ball offers and have a good chance of being accepted. But once the tipping point of 6 months or less absorption rate is reached then you might find lots of Buyer's trying to get the same property, and the bidding becomes competitive and you might have to offer more to out bid the others. The lower the absorption rate, the more it favors the Seller.

Let's take a look at the numbers: Right now there are 3,301 homes for sale in Bakersfield in the MLS, and of those 3,301 there are 1,151 Traditional Homes, 1,208 REO, or Bank Owned, foreclosure properties, and 942 Short Sales. The Short Sales are homes that are offered for less than what is owed on the mortgage, and they require the lender's approval. REO's have already been foreclosed and the banks are trying to sell them to recover as much of the money as possible, but Short Sales require the lenders to let the Buyers off the hook and write off the loss.

So, of the 3,301 homes for sale right now in Bakersfield 35% are Traditional Sales, 37% are REO, and 28% are Short Sale offerings. From September 1st to October 1st, 2008 there where 604 Sales in Bakersfield, California. That translates to a 5.48 month absorption rate. Of the 604 sales in September, 161 were traditional sales, 378 where REO sales, and 65 were Short Sales. That means 27% Traditional Sales, 63% REO Sales, and only 10% Short Sales.

If we break up Bakersfield by zip code, then we get different numbers. For an example, I will use the 93312 zip code, which is the zip code for where my office is located in Northwest Bakersfield. There are 352 homes for sale in 93312, with 133 being Traditional Sales, 86 being REO, and 133 being homes offered as Short Sales. That's 38% Traditional, 24% REO, and 38% Short Sale.

104 homes were sold in 93312 zip code from September 1st to October 1st. That is a 3.38 month absorption rate. 93312 is even more of a Seller's Market than Bakersfield as a whole. Of the 104 homes that sold in September, 35 or 34% were Traditional Sales, 51 or 49% were REO's, and 18 or 17% were Short Sales.

Zero Down goes Bye Bye!

Tue, 26 Aug 2008 18:35:59 PDT

I just read an article by Gretchen Wenner about Seller Assisted Down Payment Programs going away. I knew this was coming and was watching out for it, but since it is now a topic in the Bakersfield Californian, here is what I think about it.

An example is the NEAMIAH program. It is a non-profit organization that takes money from the Seller and donates it to the Buyer to cover their downpayment. They also pay a fee to the non-profit organization on top of that, about $500 in some cases. Why would a Seller do that? In a slow market like we are in now, that may be the only way to get a property sold. An FHA loan requires at least a 3% downpayment.

The sub prime meltdown and the skyrocketing rate of foreclosures has caused the government to act. The thinking is that if a Buyer doesn't have a stake in his investment, he will be more likely to just walk away if he has trouble making the payments. In a perfect world, this law would be a good thing, but with the glut of foreclosures already on the market, it is dragging down house prices. The only way out of the jam we are in is to burn through all of these REOs so the market can stabalize, and perhaps begin to rise again. Though the sub prime meltdown might have been exacerbated by zero down loans, there were other problems that were a more direct cause of the problems, such as allowing non documented stated income loans, and Adjustable Rate Mortgages where the interest rate goes up after an initial introductory period, making the mortgage payment rise to the point where the Buyer can no longer afford it. In a rising market, you could refinance, but in a falling market, if you have no equity, that option is not open to you.

I see this happening a lot: you have loose or no regulation, but then there is a big melt down, so then there is a knee jerk reaction to over regulate. I don't think ending seller assisted down payment programs right now is a good idea, given that sales are already slow. If you were planning to use a program like that to buy a house, you better hurry up. If you can't get in Escrow before October, you will have to save up the down payment, or have a family member or friend "gift" it to you.

There might be an extension of the programs, but it is hard to say. I have heard that the programs were ending before, but so far they haven't. This time it looks like the programs will end, but it will have a severe dampening effect on an already soggy market.