Memorial day

Hi People.

This is just a quicky to remind us all what is really important. To seperate luxury from need.

Our homes, our investments, our cars, our jobs would not mean a thing without freedom.

Freedom has to be earned. Period.

So, thank you to all of the brave men and women who gave their lives so we can be free.

God bless the servicemen & women & God bless America.

Lucy, Don't Get Too 'Cited....

Hola, People.

Lot's of news out there re home prices across the nation. Most area's prices have been going down, but a few have been going up. San Diego is 2nd in the nation (San Francisco is 1st at 16.2%) in year over end home appreciation at 10.8%, according to S&P/ Case-Schiller Home Price Index.

Before us San Diegans get all arrogant and start calling our friends and relatives in other cities, telling them to choke on that, we should look at the "why".

I would like to think that it's because God loves us more than other folks. I checked with my Pastor and he assured me that is not the case. The weather? The Padres are in 1st? More job growth than most areas? The best Mexican food on the planet (Chew on that, Texas!)? All good stuff, and it helps, but not the major reason.

1st reason is the big boys finally came out to play. Michael Lea, director of the Corky McMillin Center for Real Estate at San Diego State University, said "prices are rising because more higher-priced homes are selling than a year ago". Higher priced homes sell, the overall value goes up. Easy math.

Don't get me wrong, since people in the higher wampum bracket are selling is good news. “That’s a positive for the market overall,” Lea said. “We’ve been talking about a shadow inventory that existed, part of which is people who just held off selling because they thought prices were going to continue to go down. If more of those people come into the market, it’s healthy for the market to establish a nondistressed clearing mechanism.”

The next reason is the amount of inventory. Homes under $500,000 are getting gobbled up quicker than cheese cake on my plate. There's just more buyers than homes out there in the lower priced categories. This is keeping prices pretty stable. Sometimes it even drives the prices up,especially when all cash offers are competing against each other.

Note. Appraisers are not letting the prices get too out of hand. Just because there is 20 offers on a property does not mean the highest price will still get a favorable appraisal. Supply and demand means nothing when it comes down to appraisal. They can only go off of current comps.

So, these are good #s in San Diego. Things are looking up. But, the #s do not tell the whole story.

Let me know if you want comps ran on your home or on an area you are digging. 619-507-7449.

God Bless

Hi People

Hi. Test. Just bought a new droid and was seeing how the blog thingy worked.

Fannie & Freddie Sitting In A Tree.......

People, cheers (Said in an English accent. A bad one).

It's Friday. I'm hungry and tired. I ain't doing it! I'm giving the keys to my good friend Sam Gardner at Gardner Mortgage.

Hit me up for anything, 619-507-7449.

Greetings from scenic Mission Valley,


First off, I want to say that I do not intend to write my updates on a weekly basis (although, some might say, regardless of frequency, they are done weakly). The information below warranted this latest missive and will hopefully benefit many stranded on the sidelines who have been unable to refinance.

Freddie Mac has announced a new program designed to help those without sufficient equity to refinance their mortgages. Fannie Mae has a similar program but it is limited to loans they service (roughly 10 -15% of the people I checked on). Freddie Mac's new 'Open Access' program was designed to help families unable to refinance due to low appraised values. This program will allow homeowners to borrow up to 105% of their homes value with very competitive rates (below 5.0% as of this morning!)

To qualify for either program, the current loan must be serviced by either of the two above entities. You can't pay-off an equity line or second mortgage (loans can be subordinated) or pull cash-out but this program works with primary residences, rental properties and vacation/2nd homes!

Again, not everyone will qualify for these programs but it's quick and easy to check to see if you take advantage of historically low rates and a rebound in the housing market. You can check to see if you qualify by clicking on these links FreddieMac or Fanniemae. It's super simple to do or email me and I'll check it out and let you know if either program works for you.

In closing I really want to thank everyone once again for all of your referrals. As I've said before, referrals are the life-blood of my business and I truly appreciate your telling friends, neighbors and co workers about Gardner Mortgage. Thanks.

Sincerely,

Sam Gardner

Please pass this information along to anyone who might benefit from either of these programs.

Gardner Mortgage Inc.
2667 Camino Del Rio South #106
San Diego, Ca. 92108
Office (619) 497-6125
Cell (619) 804-2417

The best compliment I can receive is a referral to your friends and family!

Bad Condo Board Member, Bad

People, People, People.

There are folks out there with too much time on their hands and not enough sense. Proof?

I recently wrote you to tell you the ups and downs of condo ownership. Some of the downs were that you had to abide by rules (Covenants, Conditions & Restrictions or CC&Rs) and that you didn't know who you would be sharing the condo community with. A good friend of mine just sent me an article of the perfect example.

Apparently, there is a condominium in Baltimore that has a K9 ca-ca problem. It would seem that Maryland dogs can not control themselves and poop all over the place. “We pay all this money, and we’re walking around stepping in dog poop,” complains a cranky old man (Who else?).

So, naturally, they put up signs (I assume) saying "cork your dog". If that didn't work they would put heavy fines on the criminal's masters (I assume) and make them watch the sad part of "Marley & Me". If that didn't work they would do something drastic (This last is not an assumption). DNA testing? Que?

That's right. There is a proposal on the books at the Scarlett Place Condominium that "all dogs in the building would be swabbed for DNA testing to create a database. Dog owners would pay $50 each to cover the costs of tests, and an additional $10 per month for the cost of having building staff pick up wayward piles of poop" says the Baltimore Sun.

Instead of this proposal being thrown out, the board is actually going to vote on it. Double que?

Now, getting this passed is a long shot (I hope). It sure does not feel legal to submit people to this new ruling after they bought their condo. But, that's what amendments are for. I hear someone screaming "Unconstitutional" in a weak, old person's voice.

I just wonder why they went to that instead of some more obvious solutions. Security cameras, catch them in the act of #2. This would also serve to fill the emptiness in the person who gets to watch the monitors and wear the Duky Police badge.

Even simpler, how about a grounds keeper who can clean up the waste. Maybe he can sweep, mop, do windows.... see where I'm going with this?

So, if you are buying a condo you could end up with some crazy ass people (I assume).

Let me know if you need help reading the CC&Rs of you condo. The nutty neighbors are on you.

God Bless.

Cancelled Like A bad Sit-Com

People (Imagine that I just gave you a high 5)!

Cancelled escrows are running a muck. Eleven already for me this year (At least that's the ones I remember). Last year was my all time record (At the time) at ten, and that was for all of '09. At this rate I'll hit 25. What is happening?

There are several evil factors at work. I will share.

Appraisals blow! This new HVCC (Home Valuation Code of Conduct) thing that NY Attorney General Andrew Cuomo gave birth to has really screwed things up.

Homes are having a much harder time appraising due to the new rules that state that brokers can not pick their own appraiser anymore, the lenders do. The lenders go to big appraisal companies (Some owned by the lender, see B of A). A pretty good idea, in theory. The problem is that these companies are sending appraisers out to jobs out of their area of competence. If you live in Riverside, you might not know that neighborhoods change drastically South of El Cajon Blvd as opposed to North of El Cajon Blvd. Huge.

Loans are tricky & delicate. The banks want more financial documentation and they want to be updated all of the way through the escrow. This always wanting updates slows things down. This slowing things down pisses off the seller and sometimes the buyer gets kicked out of escrow. I've had to do some serious butt kissing, threatening & crying to keep my people in escrow.

Bad advice. People now a days are getting way too much info/ advice from the media (Remember, they don't really report the news. They report the olds. They get their info from interviewing Realtors), from stupid Realtors (Not all) and from their friends/ family. The media & Uncle Joe's advice are usually the worst. Again, the media is not up to date. By the time they report it it's already dead. And, Uncle Joe rents and has not had a steady job in 15 years. Why would you listen to him?

There will always be cancellations, and most of time they are for good reasons. Do not be afraid to cancel. If you REALLY don't want to go through with the purchase, you shouldn't. Just don't listen to Uncle Joe, he's stupid.

Let me know if I can help with anything, 619-507-7449.

God Bless.

Con-Dos & Don'ts (Stupider)

Hi People.

Just a quick note of some of the good things and the pit falls that could come about when buying/ selling a condo.

Firstliest, a condominium is a shared ownership. The advantage is the sharing of expenses to keep things economical. The disadvantage is that you don't get to pick who you share with. In-breads? Nazis? Dodger fans?

2nd, since it is shared, there are rules that everyone has to abide by. The good thing is you don't have people painting their condo weird colors or parking their Pinto on the grass. The bad thing is you have rules. You are not the King, just a Congessman.

3, there are monthly (Usually) fees to support the community. The good thing is the shared expense thingy. The bad thing is that these funds are sometimes mis-managed. If you do not have enough money for a new roof you have to raise the fees, make an assessment of some kind or neglect the roof.

Quatro, Condos are less expensive. Good thing, less money to buy. Bad thing, you get less when you sell (Condos do appreciate but not usually at the rate a house does. Plus, you have little power to change a complex in order to get that sweat equity).

Some other things to consider before you buy:

Can the condo be purchased with a FHA or VA loan? Even if you are not using one of those loans it will effect your value when you go to sell.

What is the owner occupancy? The more home owners the better. "Pride of ownership" keeps places nicer and keeps the value up. Also, it is hard to get a loan on a condo if the owner occupancy is lower than 51%. That will really effect your value.

Have you looked at the condo's financial records? Their plans on maintenance? You want to make sure they have enough funds for future work and emergencies, and that they have a proper plan for on going maintenance.

Let me know if you have any condo questions, 619-507-7449.

Go Bless

Disclose Or Get Smacked

Greetings, People.

It is not enough to simply tell the truth. You have to tell the hypothetical truth. That is, if there is a Lotto chance of something happening to someone, and you happen to own the thing that it could happen on, you better preach it.

It's called disclosure. You've seen it used on "Law & Order" when the one legal side has some info and they have to disclose that info to the other side. It's like that in real estate, except mas. You have to disclose things you don't even know.

Like a "Lead Based Paint Disclosure". A seller or a landlord has to give this to a buyer or tenant (Unless the structure was built after 1978, when the evil lead was exiled from home paint) to tell them there is a possibility that there is lead based paint and that if ingested it could be harmful to you (Unlike regular paint that is yummy).

Now, 99% of the people out there have absolutely no idea if their home has lead based paint (the people who do know have way too much time on their hands). Doesn't matter. You have an obligation to the buyer/ tenant to disclose the possibility of it being around.

Just today the Department of Housing and Urban Development (HUD) announced settlements with 2 San Antonio landlords who did not give this disclosure to their tenants. What did the landlords agree to do? $84,000 in lead paint hazard remediation work, the landlords have agreed to pay $6,000 in civil penalties and $20,000 in Child Health Improvement Projects (CHIPs). That is a swift kick in the ouch!

So, whether you are a seller or a landlord, disclose. Disclose important things. Disclose stupid things. If you did some upgrades, disclose. If something needs attention, disclose.  Do it in writing and get signatures from ALL parties.

If you'd like a list of disclosures that will keep you safe (Hopefully), contact me at 619-507-7449.

God Bless

Bustin' Caps

People, yawnnnnnnnn.

There's nothing in the real estate news to get me mad. Nothing to argue about. Nothing to confess. When has "nothing" ever been good? No news is good news, except for people reporting the news (How dare he call himself a reporter).

So, just a quick lesson on the Cap Rate (Capitalization Rate) and what it means to your real estate investment.

The Cap Rate is the ratio between the yearly net operating income produced by an asset and its capital cost.

Let's say you buy a duplex at $300,000 and it produces $2600 worth of rent (Very doable now here in San Diego. There are even better deals than that). Let's calculate the Cap Rate.

$2600 times 12 months comes to $31,200. That's your gross income. Now you have to take out your expenses NOT including your mortgage (Not considered an expense. I do not make the rules).

Expenses will typically be: Property taxes (Your income taxes are your problem), vacancies & maintenance (Maintenance can cover a very broad spectrum. We will keep it simple).

Property taxes on our deal will be approx $3000. The vacancy rate in San Diego is approx 5% (One of the best in the country) which comes to $1,560 from our $31,200 gross, & maintenance is a variable type # (Anything can happen. Also, the dollar amount will change drastically if you do it yourself or pimp it out). What I like to do is take the taxes plus the vacancy and have that be my maintenance amount, $4,560.

So, our expenses come to $9,120. Subtract that from our net and we have a projected net of $22,080. Note: This is a projection. You must do your due diligence and inspect the property you buy thoroughly so you know what you have.

Now, take that $22,080 and divide it by the purchase price of $300,000. That comes to a Cap Rate of 7.36%. Pretty darn good. This doesn't even count for appreciation, which will come eventually, or tax incentives.

People, this is not the only tool to use when buying investment property. Your loan is important (Most important?). The area is important (What's that saying about location?). Your spouse's opinion (Brother, I promise this is important). Tons of other things too. But the Cap Rate is a good starting point.

Let me know if you have any questions re any real estate junk, 619-507-7449.

God Bless.

Who's Driving This Thing?

People. What does it look like?

I'm a little busy, a little tired & a little lazy (Watch your mouth) so I gave the steering wheel to my good friend Sam Gardner of Gardner Mortgage. Not to worry, he's an excellent driver (Yea, an excellent driver).
 Jack

Almost Friday Greetings to All,


Hope all is well with everyone. It's been a busy week and I wanted to to check in and bring you up to speed with an interest rate update.

Due to the economic uncertainties in both Europe and the U.S., concerns with the tragic oil spill in the Gulf and the incident in Times Square, rates have again improved. Interest rates are near their record lows (and the lowest rates we have seen in 40 years).

On another positive note, it appears that lenders once again are looking at ways to approve and fund files. This is a tremendously good sign and I look forward to a return to a more common sense approach to lending.

RATES:

30 year fixed rates for loan amount to $417,000 are as low as 4.625% with 15 year money in the very low 4.00% range. Shorter term loans are as low as 3.25% (not a typo) for 5 and 7 year fixed rates, including interest only. Not the right loans for everyone but certainly have their place in the sun.

Loan amounts over $417,000 are in the upper 4.00% range with shorter term rates in the low 3.00% range.

FHA 30 year rates are below 5.00% and you can buy with as little as 3.5% down, less than perfect credit and use a gift as your down payment. This is a great program for 1st time buyers as well as for those with less than 10% down.

In short, we may never see rates like this again in our lifetimes. The economy is recovering, inflation while dormant for now will return and eventually the deficit will force rates higher. If you are in position to take advantage of this market, I strongly advise you do so.

Hope you have a great weekend and please remember, I'm always available to answer questions or run scenarios based on your goals and needs.

Sincerely,

Sam Gardner

P.S. Please let any friends, neighbors or co-workers know that I would be more
than happy to answer any of their questions as well. Thanks

Gardner Mortgage Inc.

2667 Camino Del Rio South #106

San Diego, Ca. 92108

Office (619) 497-6125

Cell (619) 804-2417



The best compliment I can receive is a referral

Vacation Time

It's been a long time, People.

I want to grab your ear a bit on an investment that won't be for everyone, but some will dig it. Vacation rentals.

I was introduced to vacation rental possibilities back in '05 when my sister bought a nice little cabin in Idylwild, Ca. Cute 1 bed, 1 bath log cabin that was decked out with all the modern amenities.

It was cheap, so she bought it with cash (Part of an inheritance that her & I split). I told her (In the most condescending voice that I could muster) that she had lost her mind. "You won't get any appreciation out here" is what I told her.

Like siblings are supposed to, she ignored my advice and bought the cabin. I bought a Miami condo that I couldn't rent out (HOA rules) for a year.

We all no that I lost a ton of loot in Miami. Her property value did go down, but she rented her cabin out by the weekend & the week, getting up to $300 a night. When it's not being rented she goes up there with her family, occasionally inviting me so I can see my mistake up close. I sold my condo and lost money and self respect. My sister still makes money on her cabin and still uses it. Who's dumber than me?

Some goodies about vacation rentals:

Can be bought as a 2nd home (Better % rates).

Renters give credit cards instead of deposits. If any damage happens, you have them by their froot of the looms.

No eviction notices. When their done, their done. It's a temporary rental so their are different occupancy rules.

You get to use it too!

You can change rates any time you want. Christmas time, rates go up. Valentines, up. & so on...

You can actually end up getting a better return. It will be rented less days out of the year, but at a much higher rate.

Get with me if you want to hear more about this type of investment. 619-507-7449.

God Bless