Anyone with any cash in hand should be buying a house right now.

That’s what any real estate agent will tell you, obviously, but that’s also what many investors now believe.

Unfortunately, the potential home-buying public…isn’t buying it.

January’s consumer confidence report found a drop in the number of Americans who plan to buy a home in the next six months. If, however, you take out the confidence issue, the fundamentals for buying are strong:

Home prices nationally are down 33 percent from their bubble peak, according to the latest S&P/Case-Shiller report, mortgage rates are hovering near record lows, and housing supply, while falling, is still historically high. In other words, it’s more of a buyer’s market than it’s ever been.

And yet the home ownership rate continues to fall, and rental demand, occupancies and rates continue to rise.

“Federal plans to sell real estate owned properties to investors might provide some relief, but rental value growth is still likely to hit 3 percent this year and average rental yields may rise to around 5.5 percent,” wrote Paul Diggle of Capital Economics, who believes the downturn in homeownership may still have further to run.

Both Diggle and Standard and Poors’ David Blitzer cite still tight credit as the major obstacle to housing demand. Rates are low, but to get those rates you need a significant down payment. The low down payment route, the FHA, has raised fees and premiums, which for some are a barrier to entry. A full third of the market is now all-cash.

“We have to get the demand up, we have to tighten the supply a little bit before we will see any shift in prices and we haven’t seen that,” said Blitzer in an interview on CNBC. But how do you tighten supply of foreclosed homes in neighborhoods that are so empty that the homes are deemed “unsellable.” Blitzer made an interesting observation:

“Periodically in studies of urban renewal, people come up with arguments that, take such and such a neighborhood, level it, fence it off for the next fifteen years until we need the land and then come back in,” said Blitzer. “That’s in effect what’s going to happen to some of these areas.”

As if the San Francisco 49ers needed another hit, one of its most famous alumna, Joe Montana, has defeatedly cut the asking price of his stunning Calistoga, Calif., home by a whopping $14 million.

The 500-acre “Villa Montana,” which hit the market in 2009 for $49 million (get it?), is now selling for a 29 percent markdown at $35 million – proof that even NFL Hall of Famers might be fumbling in a depressed housing market and sluggish economy.

Though, looking at pictures of the spectacular home, you’d be easily fooled into thinking it would sell anyway. The sprawling 9,700-square-foot Tuscan main house sits in lush wine country and is described by Joe Cool himself as “an expression of art and architecture.”

Though our friends at Curbed report that the estate lacks any “trace of a football past,” it’s still incredibly sports-friendly with full equestrian facilities (Montana loves horseback-riding), a basketball court, a swimming pool, a skeet-shooting range and even a bocce ball court. Inside the main house, you can enjoy some excellent Superbowl Sunday-friendly amenities — a beer tap, pizza oven and (multiple) flat-screen HDTVs, so you won’t miss a play.

For those who aren’t big on sports, that’s fine too — the estate also boasts an olive farm, a spa and a 45-foot-deep pond stocked with local bass.

Avram Goldman from Pacific Union International has the listing.

A mericas continued housing troubles are plaguing new home builders as they announce their worst year ever.

WASHINGTON (AP) — Fewer Americans bought new homes in December. The decline made 2011 the worst year for new-home sales on records dating back nearly half a century.

The Commerce Department said Thursday new-home sales fell 2.2 percent last month to a seasonally adjusted annual pace of 307,000. The pace is less than half the 700,000 that economists say must be sold in a healthy economy.

About 302,000 new homes were sold last year. That’s less than the 323,000 sold in 2010, making last year’s sales the worst on records dating back to 1963. And it coincides with a report last week that said 2011 was the weakest year for single-family home construction on record.

The median sales prices for new homes dropped in December to $210,300. Builders continued to slash price to stay competitive in the depressed market.

Still, sales of new homes rose in the final quarter of 2011, supporting other signs of a slow turnaround that began at the end of the year.

Sales of previously occupied homes rose in December for a third straight month. Mortgage rates have never been lower. Homebuilders are slightly more hopeful because more people are saying they might consider buying this year. And home construction picked up in the final quarter of last year.

“Although this decline was unexpected, it does not change the story that housing has likely bottomed,” said Jennifer H. Lee, senior economist at BMO Capital Markets.

Ian Shepherdson, chief economist at High Frequency Economics, said easier lending requirements, historically low mortgage rates and improved hiring all point to consistent, albeit slow, rises in sales in the coming months.

“A sustained rise in new home sales is imminent,” he said. “Homebuilders say so too, and they should know.”

Hiring is critical to a housing rebound. The unemployment rate fell in December to its lowest level in nearly three years after the sixth straight month of solid job growth.

Economists caution that housing is a long way from fully recovering. Builders have stopped working on many projects because it’s been hard for them to get financing or to compete with cheaper resale homes. For many Americans, buying a home remains too big a risk more than four years after the housing bubble burst.

Though new-home sales represent less than 10 percent of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to the National Association of Home Builders.

A key reason for the dismal 2011 sales is that builders must compete with foreclosures and short sales — when lenders accept less for a house than what is owed on the mortgage

Builders ended 2011 with a third straight year of dismal home construction and the worst on record for single-family home building. But in a hopeful sign, single-family home construction, which makes up 70 percent of the market, increased in each of the last three months.

Contact us to find out how you can become a SHARP Certified Agent.

Kris and Kim

Case-Shiller released the 4th quarter tracking on home prices.  Los Angeles, while not a the top, certainly was showing now signs of home pricing rebounds…with an annualized decrease of almost 5% year over year and a 1 month decline of 1.5% from September “11 to October “11.

There is much talk about a massive influx of foreclosures in 2012…however, with continued declines I believe the numbers are much exaggerated.  Why?  The banks and services are already dealing from massive volumes of losses…supported by the recent announcement from BofA carrying over $2.5 billion in foreclosed housing inventory…yes, BofA is holding on to these homes to keep the hosting prices strong and limit the continued declines in pricing.  If BofA flushed their inventory on the US Housing market, I project that the housing market would see an additional decrease of up to 0.5% based on the volume and impact to the seasonal lows.  I believe banks are doing everything in their power to control housing prices.

Simple economics…greater inventory equates to reduced proportional demand equates to reduced housing prices.

With the banks now endorsing the once elusive Real Estate Short Sale…we will realize more incentives to sellers to choose short sale -vs- the alternative of walking away and adding foreclosure inventory to the overstressed housing market.

With the government endorsing new Short Sell, Rent and Buy Back programs, we will see Americans choosing to salvage their immediate futures and securing a more dignified solution to foreclosure by short selling their home to a “non-profit” entity, renting for a few years, and purchasing the home back minus the negative equity that strapped them to the burden…a win, win…win for all parties.

Heres is a snippet from the most recent Case Shiller Housing Report:

New York, December 27, 2011 – Data through October 2011, released today by S&P Indices for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, showed decreases of 1.1% and 1.2% for the 10- and 20-City Composites in October vs. September. Nineteen of the 20 cities covered by the indices also saw home prices decrease over the month. The 10- and 20-City Composites posted annual returns of -3.0% and -3.4% versus October 2010, respectively. Fourteen of the 20 MSAs and both Composites saw improved annual returns compared to September’s data. Miami saw no change in annual returns in October; while Atlanta, Detroit, Las Vegas, Los Angeles and Minneapolis saw their annual rates worsen. At -11.7% Atlanta posted the lowest annual return. Detroit and Washington DC were the only two cities to post positive annual returns of +2.5% and +1.3%, respectively. 

Great laughs!

In an effort to stimulate sales and reduce housing inventory…the HUD extended it’s “lift” of the ban on “Flipping”…the process of purchasing a home, fixing it up and selling it on the open market…sounds sill but yes…the Government had a rule against that…like the government needs to regulate anything else in our lives.

So hear ya go…the announcement:

The Federal Housing Administration is extending its waiver of a rule that prohibits the agency from insuring homes sold within 90 days of their acquisition.

The anti-flipping regulation was designed to prevent activity that harms neighborhoods by allowing buyers to acquire property and then quickly sell them at inflated prices.

While the law was created to maintain stability in the housing market, the FHA temporarily waived the rule back in 2010, saying a reprieve would allow buyers to acquire HUD-owned properties, bank-owned properties and private homes for the purpose of improving them and selling them to revitalize neighborhoods.

The waiver is set to expire Jan. 31, but will now be in effect through Dec. 31, 2012.

“This extension is intended to accelerate the resale of foreclosed properties in neighborhoods struggling to overcome the possible effects of abandonment and blight,” said Carol Galante, acting FHA commissioner. ”FHA remains a critical source of mortgage financing and stability and we must make every effort to promote recovery in every responsible way we can.”

The waiver is subject to certain restrictions and stipulates that all qualified transactions must be at arms-length, meaning parties to the deal cannot be striving to achieve some type of kick-back or special interest separate from buying and selling of the real estate.

When the sales price of the property is 20% or more above the seller’s actual acquisition cost, the waiver will only take effect if the lender meets all criteria and provides documents that justify the price increase, according to the FHA.

Furthermore, the waiver applies only to forward mortgages and is not eligible for home equity conversion mortgages.

The FHA said it extended the waiver after finding it takes less than 90 days to acquire, rehabilitate and sell a distressed property.

Short Sell, Rent and Buy Back

Much needed and long awaited, BofA is stepping up and addressing the homeowners face to face in 45 scheduled meetings across the US. What’s BofA’s objective…probably to tell their homeowners that there is nothing they can do…but in a nice formal manner so as to get it across to their homeowners that we can’t help you, because if we help you…we have to help everyone….and that goes against our inept senior managements ideals of Platinum Parachutes when they get fired later this year…for driving the largest American bank into the ground…While former President and Banking Mafia Kingpin…Ken Lewis…sits back with The Godfather…Angelo Mozilo and laughs their way to bank account obesity!

BofA Gets Up Close and Personal with Distressed Homeowners

By: Carrie Bay 12/19/2011

LA Times shared this article…

Not surprising that we see this increase…FHA, Fannie and Freddie are filing suit against it’s services on it’s loans that if the Homeowner is in the foreclosure process, that the servicer must proceed with trustee sale dates…or face massive financial penalties.

Your government at work…

Here’s the article