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bearishgurl
ParticipantI recently attended a disso hg in a case I worked on where the wife (age 60) narrowly escaped the 64K+ debt her spouse had recently rung up at a well-known for-profit “university.” Luckily, when she found out about the extent of this borrowing just last year (after receiving numerous letters from his SL lenders hounding him for payment), she was able to eventually close ALL the credit accounts she had with him and so has no joint debt. He ended up taking a job with a company he worked with over 20 years ago, in a position that requires only a HS Diploma. Their house was foreclosed on in May 2011 (a house SHE inherited free and clear in 1993)! Unfortunately, she commingled the “cash-out” refinance funds with her spouse during the pendency of the marriage and so now has nothing, is “renting a room” and has no health insurance. I’m reasonably sure that this is not what her parent(s) intended when they left her their family home.
Although student debt is ONLY on the credit report of the student and NOT the spouse, its implications for the couple’s financial future are great and far-reaching. If the spouse’s income is going to be used to service the debt, how much of his/her income will be available for monthly bills and daily needs? And what if the “newly-educated,” indebted spouse isn’t employed at all or vastly underemployed??
I also know an early 50’s female who rec’d a doctorate-level degree in May from a “private” university. Payments on her (approx $120K) student loan start next month.
I’ve seen a lot of young people fall for these “sales pitches,” but, for the life of me, why would a baby boomer attempt this with age discrimination rampant all over the country? IMO, it’s absolutely financial and retirement suicide, esp in this economy.
Participant[quote=briansd1] . . . I take public transport myself, whenever convenient or available (such as bus to and from One America Plaza to SD airport). I challenge anyone who criticizes public transport to take it themselves.[/quote]
I’ve taken this bus to the airport as well, brian, when I didn’t want to bother friends in the middle of the business day for a ride to the airport. It’s VERY convenient (if you will be checking just one bag). Also, I used to leave my car underground in my workplace parking lot (employer-paid) while out of town on short trips. The other times I’ve taken the trolley and bus when my car was in the shop were, of course, slower, but got me exactly where I needed to go.
Participant[quote=pfflyer] . . . Who believes the prime areas (waterfront) will decline or will remain the same due to lack of inventory as boomers die in place?[/quote]
I do not believe “waterfront, whitewater view or expansive city view” properties will decline in value. I don’t know if “boomers retiring in place” will be the cause of the stability of these prices (maybe to some extent) but I DO think that properties handed down through families (Prop 58 “heirs”) have a LOT to do with the dearth of high-quality “prime properties” on the market in CA coastal areas at any given time, thus keeping the values of the properties that ARE marketed higher. Prop 58 virtually enables a property affected by the (Prop 13) freezing of values at the April 1978 level (+2% per year unless Prop 8 is invoked [ex. 2010]) to receive a very deep property tax discount into perpetuity as long as it is passed down through a family (whether or not any $$ ever actually exchanged hands).
Participant[quote=sdrealtor]FYI the trustee sale was postponed until 11/08 due to a bankruptcy. Not sure what others are talking about but that is whats going on.[/quote]
JJGittes, I don’t belong to any “foreclosure services” to obtain the latest postponements, etc, but can relate the following:
If one “deeds” their defaulted property to a third party on the eve of trustees’ sale, this does not prevent the sale from happening. Many “equity purchasers” promise to “save” a distressed owner’s property from foreclosure but instead do nothing and hope to benefit from the use of their property while the sale is pending. I haven’t checked PACER to verify in this case but a BK filing would simply be the latest tactic Liebke could use (in the short term) to delay a trustee’s sale. Eventually, most all lenders holding defaulted trust deeds awaiting sale obtain a release of the BK court’s automatic stay from foreclosure proceedings. The Big Banks have a fleet of attorneys on staff or on contract who have no other duties but to obtain these releases as expediently as possible.
Liebke signed the defaulted-upon note(s) and he is the one who will be foreclosed on, when and if that happens. The fact that Licht has a “grant deed” from Liebke for the property is of no consequence unless Licht himself is able to cure the default plus trustee’s fees and late fees on behalf of Liebke. In any case, in this situation, the “redemption period” has passed.
In addition, 2nd and/or 3rd TD holders on a property sometimes come to a trustee’s sale to bid on that property being foreclosed on by the 1st TD holder, IF it is economically practicable for them to do so to save their positions.
sdr or UCGal (someone who subscribes to a service), please keep us posted as to the status of this trustee’s sale. This situation is interesting as I haven’t seen in a long time a defaulting trustor try an “equity purchaser” tactic, ostensibly in effort to “muddy the waters” in his (imminent) trustee’s sale.
I would be interested to know what the first sale date was and possibly the 2nd sale date (if it has already come and gone).
ParticipantThis just came in and I was going to post it in my recent “CA Demographic Shifts” thread, but I think it better addresses the OP’s original question here. In it are some interesting charts on demographics (as they relate to housing choices for CA’s largest counties).
The most dramatic changes have taken place throughout Southern California, where Los Angeles and especially Orange County both aged faster than the state average. This may be due largely to the boom in housing prices, which drove out less established young homebuyers while drawing successful older citizens with the accumulated wealth to buy a home. As prices drop and some of the youth are able to return, the recent age rise may well level out. San Diego was also influenced by this boom, but aged slightly less, perhaps due to its many universities, its proximity to the border (and thus to generally younger immigrants) and its association with the military.
Brokers and agents in counties seeing expansive growth in the elderly population, like Orange County and in particular the city of Irvine, need to prepare for a sort of calcification in their demographic. Time has shown that the older people become, the more they act like themselves and the less amenable they are to change. Retirees and senior citizens living in the Southwest are likely to pursue the same SFR-based suburban living that they have known all their lives, with the Census reporting that 40% remain in the same communities. While rental properties flourish in urban centers, and debt-laden inland buyers are forced to rent until their finances recover, the elderly population will (for the main part) continue to live comfortably with well-mown lawns and cars for every garage.
In the meantime, the young population has concentrated itself in California’s Inland Empire, where low cost-housing was accessible within driving distance of major cities and the careers they offer. Not incidentally, Riverside’s population grew faster over the last ten years than any of the other counties listed, gaining 644,254 people – a 42% increase in size – in the first decade of the 2000s. San Bernardino followed suit, growing by 19% while the median age grew by only seven months…
see: http://firsttuesdayjournal.com/age-and-education-in-the-golden-state/
ParticipantThen Liebke bought it new. It was typical for developers to put unqualified buyers in homes by offering a 2nd TD as part of the downpayment, ESP in 2004 – 2006.
How much are the mo HOA dues there? Apparently, they haven’t been paid for approx 54 months but the HOA has obviously made no move to foreclose their lien.
ParticipantI haven’t checked with the SOS but it is also possible that Fred Licht (not Light) is or was a principal in JLH “Mortgage Co,” the orig 2nd TD holder on this property. He could have taken it from Liebke in lieu of foreclosure.
No matter WHO the new “owner” is, persons who deed their properties to “equity purchasers” on the eve of trustee’s sale are usually desperate for “walking money.” I don’t know how long Liebke collected rent while in default on all of his TD’s but it could have been 3.5 years or longer.
Not sure if this property was bought FF. It appears to be subprime.
I will take an educated guess here that Licht and/or his associates are trying to work with the defaulted lenders to get rid of all the late charges/trustees fees, cram down a little and pay them off. I do NOT know what is currently owed or how much the property is worth. Perhaps Licht’s alter-ego “Brookside Land Trust” is a REIT of spec builders in the area or had something to do with the funding/building of the tract.
How old is the tract?
ParticipantIt appears it was deeded to a possible “equity purchaser” on 7-11-11 (Light/”Brookside Land Trust”). Orig Trustor Liebke bought it in ’04 with a 1st and 2nd TD and refied one or both TD’s at least once. There also appears to be a 3rd TD against the property. All have been in default since Apr – June 2008. The 2nd (or 3rd) TD holder filed a NOS on 9/23/08, then rescinded. The 1st TD holder filed an NOS on 4/25/11, got their affairs in order (Assigned MERS to USBANK/Citicorp on 4/25/11), then filed another NOS on 6/22/11. No trustee’s sale has yet taken place.
“Equity purchaser” may currently be negotiating with outstanding lenders.
HOA lien in favor of Waters End still outstanding (dtd 7/25/07). Taxes appear to be caught up.
Edit: newly issued tax bill still in the name of Liebke who is NOT taking the HOEX. Therefore, I believe no change of ownership has been filed with the County Assessor on this property.
Participant[quote=walterwhite]My 80s Japanese car is leaking so much oil my wife is making me park it at the bottom if a steep driveway. Kind of the opposite of luxury.
My kid just got his permit.
I need a safe car for him.
Definitely not this piece of crap.[/quote]
scaredy, if you have a Toyota, I can recommend a good honest garage in SD who can replace that main seal and/or cam seal so your son will be able to use the car. pm me if you need it.
Participant[quote=pfflyer]Thanks for your responses. I cringe when I see listing prices at or above 2006/07 sold prices. I would think we would be at 2003 or thereabouts. Maybe the coast just hasn’t dropped yet (or never will to that extent.)…[/quote]
pfflyer, you have to ask yourself (on a case-by-case basis), “What was done to the property since 2003?”
You can’t expect to get $100K ++ in “improvements” for “free” if the property was purchased “original” or “near original” in 2003 (or thereabouts) unless the sellers are about to lose the property to foreclosure and their lender(s) are willing to “play ball.” It’s not purely a “numbers game” in the areas you are looking in. Many of those ‘hoods may have been tracts at one time but since the vast majority are now remodeled to varying shapes and sizes, they could now be considered “custom areas.” Therefore, the money spent on them by former owners varies WILDLY from property to property.
Your “numbers game” only works on tracts in which there are few models (under 6), the houses are fairly new (under 20 years old) and the type of buyers who purchased them in the past didn’t have the wherewithal to drastically improve them (and/or the area wasn’t worth spending a lot of “home improvement” money in).
pfflyer, if you want an “under-market deal” in one of your target areas, I recommend looking for a very dated fixer and offering to pay in escrow for any termite work needed.
Participant[quote=pfflyer]I agree with you about longtime owners. I wonder what the percentage of these homes are pre 1978? How many were overstretched owners and are in shadow inventory? Not many listed in 92109 or 92037….[/quote]
As to pre April ’78 “original” owners in those two zips, I will take an educated guess and say it is 35-40% in 92037 and 25-30% in 92109 (SFR’s only). Only a few condo complexes (w/HOA’s) existed prior to April ’78. Most multifamily units back then were rental apartments.
I didn’t include in my previous post that pre-April ’78 owners do not have to occupy their original property … that is, take the HOEX on their property taxes, in order to keep their “Prop 13 status.” They can let other family live in it or rent it their property out.
I don’t think either of the above zip codes have too much of a problem with “overstretched owners.” The “overstretched owner” in those areas more often than not took out a 2nd TD or HELOC during the “bubble era” of which nearly all was spent on remodel/rehab (making their property more saleable or “worth more” today) or actually purchased during the bubble era for a grossly inflated price and MUST SELL NOW (cannot hang on for whatever reason) or be foreclosed upon.
Remember that an “inflated bubble price” in 92109 and 92037 would not be as “inflated” as some other non-coastal areas.
The reason I believe the above to be true is that persons who buy SFR’s in those areas (in 92037 especially) typically DO NOT need “cash-out” mortgage money to “live on” and often DO NOT depend at all or solely on W-2 income to qualify to purchase a property there.
Condos in those zip codes likely have their share of distress and I don’t know if it is more or less than other areas of SD County with comparable condo values.
I’m not sure if there will be a “bottom” in these two areas (SFR’s) and if there is, it is already here or has come and gone. They are areas of unique properties (some with expansive views) close in and close to nice beaches. The “bottom” in these areas is in the art of the deal. Your mileage may vary dependent on seller motivation and your RE agent’s (or, if purchasing FSBO, your) negotiating skills.
pfflyer, since 92109 is one of your choice areas, I believe jpinpb has done extensive and lengthy research on distress there in the past (not sure if it was on condos, SFR’s or both). She may be able to give a more educated opinion than me as to whether she thinks properties in that zip have reached “bottom.”
ParticipantAs long as none of our Senators put the progeny of Prop 13 (Props 58 and 193) “on the table” for examination of their far-reaching effects by the CA Legislature (for a possible repeal of the measures), the beat will go on. These prime properties, as they stand, are worth FAR MORE to their pre April ’78 owners, children, grandchildren and/or heirs than any subsequent “arms-length” owner. Unless the original prop 13 owner(s) die while in residence and their property is sold by out-of-county heirs who have no desire to move back to SD County (or that particular property) or none of the heirs can buy the other(s) out (if the family home is bulk of the estate), then I believe the majority of these properties will stay within the family. I have even seen these properties inherited from parents and then quit-claimed to an unrelated spouse in a divorce settlement, never triggering a reassessment!
This situation is very unfair to any current owner purchasing AFTER April ’78 (esp those who purchased >2000) or potential owners. “Prop 13 benefits” should have died with an affected property’s original owners. It should never have been allowed to be passed thru in life or death as its sole function was to keep retired senior citizens in their homes until they sold or died. Now, able-bodied heirs of ALL ages enjoy this benefit while the rest of us pay 1% of currently assessed value (+ local fees and voter-approved bonds)!
This legislative blunder is the greatest systemic cause of what you are seeing as “the best properties never moving,” IMO.
I believe it is rare when a truly “valuable property” in CA’s best zip codes actually comes on the market. Even for a cash buyer, a HUGE deterrent is both current and rising taxes (if and when values go up again) :=(
Participant[quote=briansd1]…About those houses, I’m not crazy about the renovations. Generally, I think that independent renovations by homeowners are never as good as those designed by architects or designers, and need to be redone again. I’d rather have a lower price without any renovation at all.
The Elliot house is better then the Plum house, IMO. More SF, plus it’s a one story with a guest room above the garage.[/quote]
brian, agree with you on this. I would rather purchase a house in “original” condition for a heavily discounted price than get a lot of “graniteel” I don’t want (as in the Elliot listing).
I also prefer one-story homes, but Plum is a much better street and the house is better designed . . . even presents as an “unusual” standout … really something to be proud of. Its staircase is not a typical “L” or “U” (spacesaving) design bounded by walls but is open at an attractive angle and has two landings.
I think it is worth it in some areas to hire an architect to do a remodel and 92106 is one of them.
Participant[quote=jpinpb]3626 Elliott Sold for 745k, PPSF: $288. A bit lower than the Average-Median of about $340. Not to mention, the new owners only had to wait a year and a half for a 300k price reduction, since the sellers initial LP was $1,050,000.
It’s not even 200k off the 2005 price, but I think if you factor in the interest rates, again, helps make it tolerable. This place has also been granitized during the bubble, so not a fixer. Not a great deal, but another place that sold for a pretty good price for PL.[/quote]
Again, nice property, jp. More sf for the $$ than the Plum one, but not in as good of a location and not as aesthetically pleasing (curb appeal). Still a very private backyard and lot of improvements done for VERY patient buyers.
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