Calabasas Underwater Homeowners Gulping for Air Until 2015
March 30th, 2010 Categories: In The News Calabasas
Gulping for Air
Calabasas Homeowners will be holding their breath until 2015 according to First American CoreLogic as positive Equity Won’t Return For Most Underwater Borrowers for about five years.
First American CoreLogic estimates that the typical US homeowner who has negative equity in their property will not experience positive equity until late 2015 to early 2016. CoreLogic projects more than 11.3m, or 24% of all residential properties with mortgages had negative equity at the end of the fourth quarter 2009. While the largest decreases in home prices appear to have already happened, it remains to be seen when borrowers will return to positive equity.
To predict how long borrowers will remain in a negative equity position, CoreLogic projected future home values and unpaid principal balances to gauge how long it will take for the average underwater borrower to return to positive equity.
According to the projections, it will take the typical borrower until late 2015 or early 2016 for negative equity to disappear. Negative equity is widely considered a trigger to strategic default, and a Treasury Department program announced Friday attempts to address the problem by pushing lenders and servicers to offer borrowers principal reductions on their mortgages.
Although house price appreciation will, over time, offset negative equity, amortization, the paying down of loan balances, will in most cases be a more significant remedy to negative equity, a research note from CoreLogic economists states. Over the next 10 years, the average loan balance will decrease by an annual rate of 3.3%; meanwhile home price are expected to increase at a 3% annual rate over the next decade.
If five years seems like a long time to be holding your breath, call or email Tracey Thomas to find out your options. There are programs available to help underwater homeowners such as loan modifications, short sales and owner financing. Our team specializes in solutions for distressed and underwater homeowners. Please call 818-652-2937 now for more information.
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Calabasas Home Prices Inch Up in February
March 17th, 2010 Categories: In The News Calabasas
The Calabasas housing economy is showing signs of recovery. A whopping 16.7% of the homes listed for sale in Calabasas were in escrow during February 2010 as compared to only 2.5% in February 2009.
Affluence and luxury surround Calabasas with the median home price close to $1,000,000. This means that most Calabasas homebuyers end up shopping for a jumbo mortgage. Since the mortgage meltdown of 2007, it has been difficult for a buyer to get a conventional mortgage, let alone a jumbo loan. In 2004, all a home buyer had to do was fog a mirror and he could get a mortgage, no income check, no asset check. But this hasn’t been the case since 2007 when banks became extra cautious. it’s been so bad lately, the famous Russian billionaire Mikhail Prokhorov had to pull out of a real estate deal and lose his 53 million dollar deposit on a property due to financing woes.
Luckily the jumbo mortgage market has finally started to open up. This is great news for Calabasas home sellers and would be buyers. We’re finally seeing hordes of Calabasas buyers pre approved for a mortgage and ready to buy. I’ve hosted several several open houses in the past two months. Can you say “jam packed”? Home buyers are out there in droves and the inventory is low. There is less than 4.5 months of inventory for sale right now, down from 34 months of inventory in February 2009. Normally we say that six months of inventory is a balanced market. Anything more than six months of inventory is considered to be a buyers market and less than six, a seller’s market.
Home prices in Calabasas have started to creep up. During January 2009 there were 24 closings in Calabasas. Homes sold at approximately 93.67% of their list price for an average of $306 per square foot. The least expensive per square foot, a three bedroom, two bath, bank owned property with a damaged foundation sold for $231 a square foot. On the other end of the spectrum, true luxury sold for $420 per square foot. The exquisite Calabasas Oaks, celebrity style, five bedroom, six bath home included a home theater, recording studio and resort like backyard with jetliner views sold and for $2,700,000. In February there were 16 escrow closings in Calabasas. Homes sold at approximately 95.74% of their list price at an average of $337 per square foot. February sales ranged between a three bedroom, two bath condo on Las Virgenes Road for $410,000 to a Spanish Colonial estate in The Oaks with Brazilian Oak floors, cabana and dramatic views. This mini mansion sold for $2,800,000 or $413 per square foot.
Spring is prime home buying time. As buyers scramble to buy a home before school starts in September, expect to see Calabasas home prices continue to inch up.
To find out what your Calabasas home is worth or to buy a home in Calabasas please call Tracey Thomas at 818-652-2937.
Calabasas Homes in Escrow February 2010
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