The days grow shorter and the leaves turn, football begins (not my sport) and baseball heads to the post season … the Giants, still in first place, pulled it through with a single home run last night … 1 – 0 is a nail-biter of a game. Please step up the run support gentlemen. That’s the good news.

Good news for buyers: Here’s a price reduction to let you know that there are willing sellers who aren’t concerned about a few dollars and read the market as ‘sell it now while the selling is good’ …. 12 Saint Lucia Place, Tiburon, was reduced from $6.3M to $5,670,000 … every half million dollars counts but these people, according to listing agent Penny Wright-Mulligan of Pacific Union International, want to sell, now. This is a 5,000 square foot home with a pool and a deep water dock, a wonderful three bedroom main house and a two bedroom guest house. It’s a wow! Want to see it? Let me know.

Yesterday’s lunch with a real estate attorney I know was fascinating. Looks to be that he’ll be working with a firm that is going after mortgage brokers to recover moneys for banks that lost money to mortgage fraud. Hmmm … seems to me the banks got a bunch of their money back from the government and now are going to get more money.  Invest in bank stock, anyone?

After that lunch I had a discussion with a client (also nameless, just assuming that’s what he’d want), who years ago worked for B of A in risk analysis, told me of the time B of A was considering letting go of their wholesaling of loans. His analysis, which was accepted, was that there was no more risk in the wholesale loans than in the internally generated loans. Think of it, B of A was preparing to drop ¼ to 1/3 of their loan business until they saw that the risk (I think ‘fraud’) potential was no different internally vs. externally. Interesting.

Another eye-opener, one that I’d prefer to whisper, was what one blog responder called ‘the domino effect’ of supply and demand. The supply of homes to sell is increasing while the demand is decreasing … a bad sign for values.

On the supply side we have the normal sales, plus the foreclosures, plus more foreclosures (tax sales as well as mortgage defaults), plus the bank-owned properties, plus the cash for keys, short sales and the soon-to-come sale of homes (1 in 10 homeowners is behind in payments and loan modifications are few and far between). A big supply will drive prices down.

On the demand side, even with the tax incentive, that ended, the demand was moderate. In spite of the lowest mortgage rates in forever, sales have slackened. With the credit crisis, low consumer confidence, unemployment at 10% with an additional ‘past unemployment’ rate of 7% and a zillion people underemployed (short hours or reduced pay or furlough) … the signs are not hopeful. If you plan to sell, do it sooner rather than later …. unless you foresee some good news … which I’d love to have you share with me!

So perhaps reading this might point you in the right direction and render your life marvelous … if so, email me, go to my website www.tomverkozen.com or call (415) 637-7974 and let’s have some fun while you get into liquidity or shop and buy a bargain. There are some great finds out there! 

Posted by:  Tom Verkozen