[mydogsarelazy]

Here is my personal prediction for Southern California Real Estate. Bear in mind I am an art teacher, not a real estate professional.

I think that in the next 3 months the public is going to wake up to what we on this board already know: real estate is in big trouble.

There will be a “reverse panic” that will take a year or so where everyone who can will dump real estate. It is going to be harsh, so sure a Tsunami works for me.

Yes, there will be an accompanying recession etc.

Then, a few of the underlying factors will kick in. Foreigners will buy more of California with their stronger currencies and population growth will continue to stoke demand. This will lead to some stability and there will be a long period of sluggish, mediocre, relatively stable prices.

A whole generation of Californians will have learned that the idea that “real esate never goes down” is painfully wrong.

JS

[mydogsarelazy]

Hi Mortgage Banker,

I want to know about the legal risks of co-signing.

You will remember I have a sister with lots of equity, mediocre credit, income from mulitple sources including a husband she is separated from.

So, let’s say I co-sign on a refi loan for her. What happens if:

– She pays late? (my credit gets dinged, right?)

– She defaults? Specifically I am imagining her home would be foreclosed, but could a bank come after my assests, wages or bank accounts?

I appreciate your advice and any precautions you may have for me.

JS

[mydogsarelazy]

Here is an article from last November that mentions some destinations:

JS

[mydogsarelazy]

Hi JES,

This is turning into an interesting thread.

I am going to start a new one on the topic of “where would you go” for people who are considering moving out of state.

JS

[mydogsarelazy]

South Temecula near Hwy 79 has many nice features — I lived there in 2003-4, but many problems too. The traffic at the 79 ramp is tremendous now and you have to ask yourself whether the Pechanga Casino is a plus or not. The drunk driving inspections conducted along Pechanga Parkway on weekend nights slowed traffic quite a bit and made me wonder about the condition of the drivers.

The new Wolf Creek development has some nice homes, but the buyers have paid a premium price, so I would look for repos and sliding values there too.

My idea of a good place to live would be Santa Monica circa the early 1960s. Is there really anyplace in Southern California where the traffic is light, the air clean and the neighbors wholesome? I wouldn’t nominate Malibu (sorry Mel Gibson!)

JS

[mydogsarelazy]

Hi Former owner,

On our street I count five houses out of twelve that have been or are investor owned.

What interests me also is how the owners who seem to be affording the payments are employed:

– A prison guard and his wife who is also employed in the prison system have just added a pool.

– Two Phillipine families who took equity out of National City and bought nice places here, but are still working far away.

– A casino manager and his wife who is in hotel management.

– A husband/wife real estate broker team. I wonder how their finances are going to play out?

JS

[mydogsarelazy]

Hi Perry,

I have an excellent job not far away, and I think some of our neighbors are solid.

Yes, I do anticipate that I will see decline in this neiborhood, but I doubt there are many neighborhoods in Southern California where we won’t see all the problems of shrinking values and over over-burdened home buyers causing problems.

The problems coming down the pike are going to be societal problems not just neighborhood ones.

JS

[mydogsarelazy]

Hello Mortgage Banker,

I have a business question for you: how can my sister get a loan?

Here is the scenario.

The title to her home is solely in her name and the home is appraised at $1.1 million — yes I know that in this market the figure could be lower — and she is separated from her husband. The house is in Northern California.

She only owes $160K on a first mortgage and wants to refi and take out as much as $100k to consolidate bills fix up the place etc. Her credit score is 610 and she pays her bills by working ($2k per month) renting the guest house ($600 per month) and by receiving $3,200 per month from her husband who is now overseas, and doesn’t want to be involved in any kind of refinance.

So, will a “stated income” loan work for her? As you can see she has weak credit, a hard to document income and tons of equity.

Any help would be MUCH appreciated.

JS

[mydogsarelazy]

Hi Desmond,

Seriously, she said she wants a divorce?

You need to speak to attorney immediately and find out how divorce would affect your assets including the money you took from the sale of your home.

Four years ago, when I was in the middle of chemotherapy for cancer my wife filed for divorce and I was stunned and unprepared to say the least. When a woman says to you that she wants a divorce don’t ignore her. Maybe you want one too given how she feels about you.

Can I also mention that I am now very happily re-married, and I met my new wife on Yahoo! so she doesn’t think the internet is evil at all. To top it off, my new wife is very clever with money and real estate and together we have made up for my financial setbacks during divorce many times over.

Sorry for your trouble, but get some legal counsel TODAY.

JS

[mydogsarelazy]

Here is my comment about demand…

Think binge/purge.

In the past four years every participant in the Real Estate market was transformed into a speculator. Everyone from flippers to first home buyers was gripped by a kind of speculative craze. It was like a national pyramid scheme.

Now there is a public perception that real estate is “over” and the purge begins. Money is going to move to other places.

What I find most interesting about what has happened can’t be found in numbers or charts. So much of happened was motivated by anxiety, greed,
and fear.

JS

[mydogsarelazy]

Hello Powayseller,

Here is a thought for you.

Since you have a Master’s you might want to consider teaching part time at a Community College. You would be nearest to Palomar, right?

http://www.palomar.edu/employment.htm

Many professional people enjoy teaching a class a few nights a week, and you might be well suited to teaching business and/or economics. Teaching is social, pays fairly well ($40.00 per hour or more) and gives you some cash flow even if you land another type of day job.

If this is of interest, try contacting both the Human Resources office at Palomar, and also the Department Chairs of areas you would be qualified to teach in.

The link below is for a state registry of community college jobs, and that might be a good place to start.

http://www.cccregistry.org/jobs/index.aspx

Hope that was helpful…

JS

[mydogsarelazy]

Hello lostkitty,

Can I ramble too?

One of my sisters is a “hot” real estate agent in Los Angeles — she is a top seller with a limo at her disposal — and I have grown tired of her lavish claims and seemingly endless income. A few months back she purchased a condo in San Clemente for $530k as an investment/weekend place/possible flip and suddenly she is frantic in trying to rent the place. I guess her huge income stream may have become a trickle.

Another sister of mine and her “we can handle endless debt” husband put a down payment on a new home in Redlands some months back, and it is almost ready. Of course, they are now finding that their home in Menifee (“we can easily get $650k for it, we have already had offers…”) is going to take a long time to sell, and possibly at a much reduced price. My guess is that they are going to end up with practically no equity left and a huge new mortgage on their hands.

Isn’t it amazing that people just felt like the real estate market would keep going and going and going?

I sold a small vacation home in Pioneertown (yes the area of the recent fires) last year at an absurdly high price and cut our home mortgage in half. At the time I thought “amazing” and am so glad I sold when I did. A friend’s place burned to the ground, and you can’t get fire insurance in some desert areas, at least I couldn’t.

Vehicle-wise, it is the Hummers and huge jacked-up trucks that annoy me. They seem to say “conspicuous consumption is still cool.” Has it ever been?

JS
________________________________________________________
Not a real estate professional, just someone who follows the market
http://www.johnseed.com

[mydogsarelazy]

Here is an article that just came out today in the North County Times….

http://www.nctimes.com/articles/2006/07/19/news/californian/22_01_577_18_06.txt

JS

[mydogsarelazy]

Hi Former Owner,

I agree with most of your points, but #9 is not accurate.

Mt. San Jacinto College, which has campuses in San Jacinto and Menifee is a very strong, fast growing community collge. When you drive by Menifee on the 215 you can see the new $12 million dollar library, and a new technology building starts construction next year.

http://www.msjc.edu

JS

[mydogsarelazy]

Hi Waiting Hawk,

That site is just great. It really shows you how the situation is beginning to develop and it won’t be long until recent buyers of homes find themselves dramatically upside down.

JS

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