Tips for getting settled into your new rental home!

Moving to a new community can be daunting and a nerve wracking experience, but it doesn’t have to be a new experience for long!

Here are some tips to getting settled into your new home and community!

Explore!

Wander around! Try a new restaurant or a new shopping center.  The expression “buy local” is growing popular, but don’t limit you buying local power to just your fruits and veggies,  try out your new local shops – you  just might find a new favorite place!

Be a tourist!

Go online,  browse the towns chamber of commerce, visit the welcome center (if your new town has one) pick up the local paper and get ready  to mingle!  Often local coffee shops or shopping centers have community bulletin boards that you can browse for neat local events as well.  Walk or bike around your neighborhood- nothing puts you closer to the sights, sounds and people of your new area.

Meet you neighbors!

Go on, introduce yourself! Not only can they often provide valuable information about your new location, but you could make new friends!

Join the community.

Join a local community center, pick up a local class, and volunteer your time! Give back to you new community and become a part of it as well.

By: Jessica Gant 11/1/12

Where have all the Sellers gone- and what this means to buyers and renters

 

Where   Have All the Sellers Gone?
Followers   of the market report know inventory in San Diego County has been at or near   the low end of the spectrum for the past year.

This   has had a salubrious effect on prices. The median price for single-family,   re-sale homes is up 10% year-to-date, using a 3-month moving average.

The   3-month moving average median price is up 26% from the bottom of the market:   March 2009.

Which   brings us back to the question, “where are all the sellers?”

You   can forget about the banks. There is no “massive shadow inventory” that will   suddenly increase inventory. Currently, banks own about 3,562 properties in   the county, which is about six weeks of inventory, if they were all dumped on   the market at once. Only 1,131 homeowners had a notice of default filed in   September, while 1,345 homeowners had a notice of sale filed.

The   only other explanation for low inventory is homeowners who are underwater and   unable to sell unless they do a short sale. Rising prices will mitigate this   problem and more homes will be coming on the market. That will take a while,   because we’re still 35% off the peak price reached in July 2006.

For   the foreseeable future, we will have rising prices fueled by lack of   inventory and multiple offers.

With   money at an all-time low, and property prices 35% below their peak in 2006,   those who have cash or can get a loan are in prime position to make a   purchase.

Rick Campbell writes and publishes the San Diego Real Estate Market Trends Report.

Rick is a California licensed broker since 1991: CA DRE #01114738.

What this means to the Rental Market.

For the rental market low sales inventory means a higher occupancy of rentals, and therefore higher rental prices.

It becomes a basic economic equation,   more demand + less availability = greater cost

As a property owner, this creates the perfect opportunity to enter into the rental market. With the right property management company, this allows you to market the property to in fullest extent, and to receive prime market rates.  Your property can reach its full income potential with proper management, from screening and finding the right tenants, to incurring market rate for your property to maintaining the property to its highest standards to ensure you continue to receive prime market rate.

As a perspective tenant, know that you will have to work a little harder to find that perfect home. Give yourself more time to look, and try to be flexible when you find the home you like.     Look for a home that’s well maintained, and see if the manager is able to lock in a lease to stabilize your rent.

Remember, the market constantly is going thru ups and downs.  For the latest market updates and to find out your homes income potential, or properties available for rent,  Please feel free to contact us at Rent@cairnx.com or reach us directly at 619-884-9115

Where we go- After Foreclosure and Short Sales

What comes after foreclosure

By  • Sep 20th, 2012 • Journal

 

Everyone knows about the pain experienced by a homeowner in a foreclosure or short sale. But when the dust is settled and the home is lost for good, what becomes of displaced owners?

We, the displaced

Over 800,000 former homeowners have lost homes to foreclosure in California since the end of 2007, and each has a story to tell. An estimated 15,000-20,000 owners take the short sale alternative each month to rid themselves of their negative equity, black hole homes.

The hardships of being forced from a home, for whatever reason, go beyond a mere reduction in credit score. Families are displaced from their residences, have very likely suffered a concurrent blow to income, and in many cases are required to make serious alterations to their standard and mode of living.

In their vast numbers, however, homeowners wiped out by foreclosure or short sale represent not only the past of California homeownership, but its future. The decisions of these former homeowners will be a major factor determining the fate of California’s real estate market.

The behavior of displaced homeowners has been little studied, but poses vital questions:

  • Do these displaced owners ultimately seek out ownership of a replacement single family residence (SFR) similar to the one they have lost, or do they choose to become permanent renters instead?
  • Do they stay in the same (or a similar) neighborhood and school district on relocation, or do they move to an area with a lower quality of life and standard of living?
  • Do they continue to live with the same immediate household, or do they combine resources with other renters/buyers, either by subletting or cohabitating, to reduce overall costs?

After five years of exceedingly high foreclosures, it is now possible to make some informed predictions about how the majority of displaced homeowners will behave.

Related article:

Federal Reserve Board of Governors: The post-foreclosure experience of U.S. households

Place of residence

According to the Federal Reserve Board of Governors report, 23% of all homeowners whose mortgage go into foreclosure move to a new location within one year after the notice. Nearly half will have relocated to a replacement residence by the end of the second year. Since this report deals with national data, these timelines reflect both the nonjudicial and the longer judicial foreclosure processes. Thus, how quickly migration occurs after foreclosure in California can’t be readily ascertained based on this report alone.

Homeowners who lose their homes to foreclosure tend to move to more densely populated — urbanized — areas closer to places of employment.

However, the character of migration, when it occurs, does have a significant bearing on the California housing market. When those who sell or suffer foreclosure move to a new location, they do not tend to go far, or to a substantially different type of residence. Fed researchers observed thatthose who lose their homes to foreclosure tend to move to more densely populated — urbanized — areas closer to places of employment. These areas often have smaller households and lower average income than the community left behind, although the difference tends to be small. There is also little difference between the ex-homeowner’s prior neighborhood and these new communities in terms of neighborhood affluence, education, racial/ethnic composition, house value or rent.

In sum, displaced homeowners tend to move to rental units in denser urban areas where jobs are located. These new neighborhoods are just as desirable as the neighborhood left behind. Indeed, the new neighborhood may even offer additional benefits over the old location, like a shorter commute and access to culture and entertainment. This is in keeping with first tuesday’s own prediction that the younger generations of Californians will, over time, abandon the suburban homes of their childhood to live in more convenient urban areas.

Related articles:

Defaults and foreclosures drop

NODs and trustee’s deeds: less depressed, but still grim

Rentals: the future of real estate in California?

Golden state population trends

Household size

Although displaced homeowners are likely to (and in in most cases, compelled to) rent rather than immediately buy a mortgaged replacement home, the Fed finds the majority of these renters continue to live in single family residences (SFRs), rather than multi-family rentals. Thus, on displacement they occupy a comparable home, at comparable rental values to the home they lost, but their monthly rent is often less than half their former mortgage payments.

It is also a well-documented fact that homeowners of more limited means, including those who have experienced the financial shock of foreclosure, are more likely to cohabitate with friends and family members while waiting for better days to arrive. Builders have responded to this trend by constructing larger SFRs designed for occupancy by large or extended families. One family qualifies, and both live in the home sharing the financial burdens between them.

However, the Fed’s research also indicates that displaced homeowners are more likely to reduce their household size; that is, while they may move in with friends or family members, displaced households often divide into smaller groups. As a result, the average household size undergoes almost no net change after a foreclosure or short sale.

Effect on the market

Should real estate agents leasing or selling houses or condos in the SFR market despair of soliciting homeowners who have been subject to an NOD recording? Certainly not!

Although foreclosures and short sales remain high, the majority of displaced homeowners will eventually go on to purchase another SFR with similar amenities. This means that housing consumption nationwide, and thus housing prices, will not be strongly damaged in the long term by the continuing high rate of foreclosure. If there is a larger shift to from purchases to rentals, as first tuesday predicts, it will be driven primarily by “Generation YThe forthcoming generation of first-time homebuyers, consisting of individuals born in the 1980s and 1990s.” and their propensity to rent – not by displaced former owners.

On a more general level, the Fed states “foreclosure does not impose an economic burden large enough to severely reduce housing consumption,” including the rate of homeownership and home sales volume.

There is hope that a recovery in home sales volume and pricing will be able to commence even before the backlog of foreclosures is removed from the market.

. The repopulation of suburban SFRs will accelerate as lenders come to accept a past foreclosure as a sign of the times, rather than a fatal financial error by creditworthy and employed individuals who have sufficient savings to take up the mantle of homeownership once again.

This is not to say foreclosure has no impact on homeownership rates, especially in California. It’s important to note that the Fed’s study does not consider the specific conditions of California, where homeownership has been in steady decline since the mid-2000s. Foreclosures, i.e., a correction of the unsustainable increase in homeownership during the Millennium BoomThe years 2000-2007 leading up to the current economic recession, characterized by loose lending practices and unsustainably high property prices and sales volume.The years 2000-2007 leading up to the current economic recession, characterized by loose lending practices and unsustainably high property prices and sales volume., play a part in this decline, but so do demographic shifts and changing interest rate trends.  first tuesday anticipates California homeownership will continue to fall to approximately 51% by 2016-2017.

Related articles:

Home sales volume and price peaks

Nobody’s home: California residential vacancy rates

Multi-generational habitation is a temporary fix for economic woes

A forecast for California

In conclusion, the clearest results of foreclosure and short sale are those which might be expected:

  • displaced homeowners are much more likely to rent; and
  • they will usually move to population-dense, urban areas closer to jobs.

While this will increase the demand for vacant multi-family rental properties and SFRs, as first tuesday has previously predicted, it is significant that most foreclosed homeowners remain in the same area and live in rental SFRs. With time, credit scores will heal, lenders will become more accepting, and, those rented units will return to the MLS inventory as homes listed for sale, sold and taken off the market.

Moreover, the fact that household size remains relatively constant after foreclosure suggests that foreclosures will not increase statewide vacancies as much as some have feared. After all, the state’s population is growing steadily at 1% annually, with households split nearly evenly between ownership and rentals (according to the U.S. Census Bureau).

Ongoing foreclosures and short sales remain a serious setback for the families going through them and for the growth of our state economy. Yet, the population’s need for a place of residence and the ingrained preference for detached SFRs will insure that California’s marketplace of existing housing recovers, mostly through buyer and renter demand, not some shortage of inventory

Is Home Ownership Overrated?

 

ImageShould home ownership be encouraged? The Economist wants you to join the debate!

The proponents of renting argue that home ownership should not be promoted since it slows the economy by tying the work force to one location. To encourage a fluid, adaptable economy, people must be able to pick-up and move to find jobs. Evidence from both Europe and the United States indicates countries with a more even balance between home ownership and renting have lower unemployment rates and better mental health and satisfaction among their citizens than countries with very high home ownership rates.

Proponents of homeownership argue that it promotes social stability and community involvement. People who own homes are more likely to maintain their common areas and seek to improve local schools. Children of homeowners are more likely to excel academically and graduate from high school.

While homeownership proponents acknowledge that homeowners are less mobile than renters, they argue that people already prone to stay in one place are influenced by this desire to purchase a home. Homeownership is a result of preexisting community roots, a sign of a chosen lifestyle rather than the catalyst for it.

first tuesday Insight

A combination of post-boom housing factors, including damaged credit and insufficient employment has made home ownership unfeasible for many would-be home buyers. For others, especially the younger Generation Y, the employment opportunities and local amenities of urban life have caused them to favor renting over home ownership.

The direction of California’s future housing market will impact the future of real estate practice. Will there be a shift in the client base from sellers and buyers to landlords and renters?

Agents: Let the scholars know what you’re seeing first-hand in California’s housing market by joining the debate online. The Economist is currently soliciting votes and comments. The debate closes September 26, 2012.

 

is lead editor for the Landlords, Tenants and Property Management and Real Estate Property Management books.

 

Copyright © 2012 by first tuesday Realty Publications, Inc. Readers are encouraged to reprint or distribute this information with credit given to the first tuesday Journal Online — P.O. Box 5707, Riverside, CA 92517.