Monthly Archives: July 2009

Upcoming Community Meeting on Redwood City Housing

housingJust got this in, from Malcolm Smith, the Public Communications Manager for Redwood City.

Every day, news headlines confirm what we all know ~ housing matters!  In fact, the quality of life in our community is directly linked to how we address the challenge of providing homes to people who work and grow up here. If you live or work in Redwood City, Threshold 2009 and the City of Redwood City invite you to join a Community Conversation on long-term housing solutions in San Mateo County. This is part of an ongoing campaign to welcome all perspectives to the table and build a public voice for housing solutions. This is an opportunity to increase understanding, exchange perspectives, and express your views on county-wide housing choices.

Registration is open to join one of these free Community Conversations in Redwood City:

  • Wednesday, August 5, 9 am – noon
    Veterans Memorial Senior Center, 1455 Madison Avenue.

Register by August 3 at www.conversation5.eventbrite.com

This is a bilingual session for English and Spanish-speaking participants

Refreshments will be provided. Seating is limited. To register by phone, call (650) 655-5851. For more information, visitwww.threshold2009.org or email info@threshold2008.org.

Threshold 2009 is a nonprofit, citizen-driven effort to engage the people of San Mateo County in decision making about housing issues. We provide an inclusive forum to build the public voice on housing choices. Learn the results of our 2008 Countywide Assembly and more on our initiative at www.threshold2009.org.

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Recently Sold Homes in Mt. Carmel – 95% (average) of List Price

In the last 90 days, a little less than a dozen homes in Mt. Carmel have closed escrow. Looking at how the sale prices compared to original price, the average is that homes are getting 95% of their original asking price.  Of course, remember, this is an average.  The “range” of all those homes is between 83% and 101% of asking price.   Here they are, in no particular order:

  • 475 Sapphire: original list: $599K, sold for $605K, 10 days on market
  • 566 Avenue del Ora: original list: $599K, sold for $590K, 8 days on market.
  • 250 Myrtle St.: original list: $924,900, sold for $882K, 37 days on market
  • 277 Topaz: original list: $650K, sold for $610K, 7 days on market
  • 37 Fulton: original list: $975K, sold for $950K, 18 days on market
  • 587 Ruby: original list: $749,950, sold for $730K, 32 days on market
  • 338 Lowell: original list: $850K, sold for $830K, 188 days on market
  • 15 Eagle Hill Terrace: original list: $949K, sold for $890K, 70 days on market
  • 181 Myrtle St: original list $869K, sold for $835K, 57 days on market
  • 366 Iris St: original list: $1,110,000, sold for $975K, 99 days on market
  • 40 Inner Circle: original list: $1,199,000, sold for $995K, 189 days on market

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The New HVCC Law – Does It Help, or Just Plain Suck?

aretheyinsanelgSo there’s this new law affecting the real estate and mortgage industry, called the HVCC – short for “Home Valuation Code of Conduct”, which went into effect last month, and is the byproduct of a legal settlement between NY attorney general Andrew Cuomo and Fannie Mae & Freddie Mac.

Here’s how it was “supposed” to help: to assure appraisers that they would not be unduly influenced by lenders in the appraisal process.

Here’s where it proverbially, “sucks”: costs rose, and accuracy in appraisals took a nosedive. Moreover, appraisers that are unfamiliar with local markets, inexperienced or both, are using distressed sales – foreclosures and short sales of existing houses – as their comparables

Kenneth Harney from the Washington Post (in my opinion, probably the best columnist covering real estate issues, bar none), wrote a great article recently(full contents here, but I’ll quote some of the highlights below).

How it can affect everyone:

It could directly affect the value of your house – probably negatively – by tens of thousands of dollars

The issue concerns low valuations and the new rules guiding appraisers in both price-depressed and rebounding markets. Consider these snapshots of what’s going on:

  • In San Diego, Steve Doyle, division president for Brookfield Homes, is trying to close out the final 20 houses of a 120-unit single-family subdivision. Prices range from $340,000 to $350,000. But recently there’s been a major hitch: Appraisers assigned by banks are coming in with valuations $60,000 or more below Doyle’s selling prices. The appraisers, who Doyle says are unfamiliar with local markets, inexperienced or both, are using distressed sales – foreclosures and short sales of existing houses – as their comparables. Some of the distressed properties are in poor condition, and all of them offer fewer amenities, according to Doyle.
  • In Wilmington, N.C., a loan applicant with a house in excellent condition, and an unblemished payment record, sought to refinance into a 4 3/4 percent mortgage. She had purchased the property four years ago for $160,000 and made about $20,000 worth of improvements in the interim. Her loan application, according to Paul Skeens, president of Colonial Mortgage Group of Waldorf, Md., was “a slam dunk. Nothing to it.” The house was worth $180,000 to $200,000, according to one estimate.

But when an appraiser with little local knowledge was sent in by a bank to value the house, he chose two short-sale properties that had both closed in the mid-$140,000 range, and one inheritance sale around $155,000. The last property was “in horrible condition,” said Skeens. “I’d call it dog meat.” The deal-paralyzing appraised value that came in for the cream-puff refi: $149,000.

Complaints about lowballed appraisals – from builders, realty agents, consumers and mortgage companies – have erupted since May 1, when government-sponsored Fannie Mae and Freddie Mac put their new appraisal rules into effect nationwide. Critics charge that the new system is fostering the use of appraisers willing to work for low fees – sometimes 50 percent below previous standards – and who are willing to conduct home appraisals far outside their typical areas of activity.

Under the HVCC, appraisers are now routinely assigned by appraisal management companies rather than being selected by mortgage companies or loan officers. The management companies pocket as much as 40 to 50 percent of the appraisal fee.

Frustration with the new system boiled over and made its way to Capitol Hill late last month. The National Association of Home Builders called for an immediate change in the rules governing the use of foreclosures, short sales and other distress transactions as comparables for appraisals on non-distressed, typical homes, whether new or resale.

Two congressmen – Travis Childers, D-Miss., and Gary Miller, R-Diamond Bar (Los Angeles County) – have introduced legislation calling for an 18-month moratorium on the appraisal code. In identical letters to James Lockhart, the top regulator of Fannie Mae and Freddie Mac, and Cuomo, the National Association of Realtors also requested a moratorium and complained that the code is raising costs to borrowers, distorting property values and killing sales.

Asked for comment, Lockhart said through a spokesperson that his agency is monitoring the situation, and considers “the views of market participants important.”

Bottom line: Be aware of the issue. It affects your equity, even if you’re not buying or selling. And watch to see whether Congress fixes the problem.

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Schedule of 4th o’ July Activities for Redwood City

(straight from the city’s Public Communications Manager Malcolm Smith)

This year’s 4th of July spectacular, brought to you by the Peninsula Celebration Association, will be another in the long tradition of offering the very best 4th of July event on the peninsula. All the details are at www.parade.org, the home page of the non-profit Peninsula Celebration Association. The Peninsula Celebration Association has been in place for nearly 70 years with a goal of helping to make our city not just a great place to live, but also a real community of people who care.

Visit www.parade.org for the entire schedule of family fun on the 4th of July in Redwood City.

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