Market Comparison

We have started to branch out beyond Folsom and EDH in our home search. So of course, the first thing I wanted to do, was look at the stats for Shingle Springs, Fair Oaks, Granite Bay, and Orangevale (I wanted to do Gold River too, but I think the zip includes most of Rancho). I pulled the historical data from SacBee's DataQuick monthly charts. This data is frequently revised, but for trend purposes the original numbers work.

Below are graphs of the main areas we are considering. One graph displays median sales price and the other, median price per square foot. Note the big clump on the square foot chart, but the spacing on the sales price chart. To me, that signals the average size house is much bigger in the more expensive zips. I can't really think of another explanation (so if someone has one...do tell). Not all periods were pulled for the chart, and some months are missing data from their website.

Side note: I went to subscribe to the SacBee, since I was feeling a little guilty using their data so much. But their prices are pretty high. Best I can tell, on an annual basis they charge more than the world renowned WSJ. And for what...news on the latest murder and mayhem. The WSJ reports what I consider to be real news. Freeway accidents, fires, and crime are what I consider current events. Important, but not healthy to read about on a regular basis if you want to keep your faith in the goodness of humanity.

Blackstone - Environmentally Friendly McMansions

Hubby and I have anxiously been awaiting the opening of Blackstone, a master planned community in El Dorado Hills (off Latrobe). They were scheduled to open early Spring, but Centex and Lennar didn't open till recently. Lennar is apparently running the show at this development. They have three communities, and Centex has one. The other developers haven't opened yet.

Our assessment as follows:

Pros:
Location: Great location. Convenient to the freeway and all that El Dorado Hills has to offer.
Community Center: There will be a large complex with swimming pools, gym facilities, and other ammenities that is the focal point for the community. Not slated to open till December 2007, but at the rate they are going, it will probably be spring of 2008.
Solar: All houses will have solar roof panels. Lennar claims their solar is better than Centex's. Also good, is this isn't their first experience with a solar community, they have one in Roseville.

Cons:
Fees & Taxes: We have been getting mixed stories on all the fees and taxes. The HOA fees do not cover yard maintenance but do cover the clubhouse. I think those run around $136 a month (per Centex). Lennar said they have a different HOA depending if the community is gated or not. The district taxes seemed really high, and slightly confusing (Centex said $147 a month, but Lennar made is sound like it would be twice that much). I need to get clarification on all the taxes still. The sales guys are still learning all the ins and outs of their community (so they are fuzzy on the CCRs and other details).
Very Limited Customization: While the base models all come very nicely "appointed," you cannot "have it your way." There is a very limited amount of choices, aside from the actual house model, that are offered. This is contrary to my understanding of the "new house purchase." I thought one of the most appealing parts of buying a new house was the fact that you get to pick everything out. In the case of Blackstone, especially Lennar, it has already been decided. All three Lennar developments will have the exact same cupboards, floors, etc. Hello.....we not drones....or are we? Neither developer has models that are finished. I find some of this hard to swallow, so I may go back and get clarification once the sales people have been on the job a little longer.
Price: While the prices are reasonable compared to resales right now, when you include the HOA and taxes it is still above what I consider a good value. We visited the Centex development in Roseville this weekend (we had never been to Roseville before) to look at the models since they are the same. The Roseville Avonlea development is less expensive, by 10-20k per model and doesn't have HOA. Unfortunately the two Lennar developments that were even close to our price range are both gated. The third high end development is not gated...go figure.

Personal Perspective: If I am going to buy a new tract house, this is probably where I would do it. I like the idea of a community center where I can take the kids swimming, and where they can hang out when they are teenagers. Our daycare center is also very close by. However hubbby is really turned off by the fees. In the current market, I'm sure it will take a long time to sell all they have to offer (especially at current prices), so I have plenty of time to decide.

For previous post see here.

Yard Sales & Gated Developments

Some of yesterdays comments reminded me of bargain hunting.......which then reminded me of another reason I don't like gated developments.

Side note: I am really struggling to figure out why people like gated developments, because they are very popular. When we visited Lennar last week over at Blackstone the sales guy looked at me like I was crazy not to like them. BTW - I am now refusing to call them gated communities, for the reason why....see this post.

Back to bargain hunting. It is that time of year when all the yard/garage sales start occurring. Round here in Serrano, I never see them. I am sure they are against the rules, and even if they weren't, the gated thing really makes it logistically difficult.

We used to hit yard sales all the time back East looking for stuff for our two young kids. They were a great way to get toys and baby gear on the cheap. Some really good bargains could be found, especially in the the nicer neighborhoods (almost none of which were gated). It was also a great way to meet neighbors.

Intuition

I graduated Georgetown Business School at the height of the dot com boom (2000). Many of my fellow MBAs had job offers at start ups.

While the money was tempting, my intuition told me something was badly out of sync. If everything I was learning in school actually applied to the real world, then these 1 year old companies with negative cash flows should not have a larger market capitalization than established firms with a 20 year track record of solid earnings and growth.

This intuition played out right around graduation, and it left several of my colleagues stranded without a job after school.

Why the long story you ask....well it is that same intuition that led us to sell our house in 2006 and wait out the real estate cycle.

Again my intuition has been questioning the current run-up in the stock market. I didn't see how the housing slowdown could not affect the economy as a whole. They way I see it, all the equity and $$ people have been making in RE over the last 6 years was fueling consumer spending. Hence earnings at Home Depot and Lowes were the first to take a hit. Now auto makers are blaming the housing market. I think we will see more unravelling to come.

Yesterday's market correction, was small. But sorely needed IMHO.

The Weekly Screen Scrape - Expirations

The overall stats for my weekly screen scrape didn't change much. However the total mask a lot of activity.

There were 7 listings that went off the market. One I know for sure was a short sale, so that is probably being transferred to the bank. Another was owned by a Realtor (we had seen it when we were still planning to buy immediately), it was by far the most expensive listing at $266 a square foot, and she never dropped her price. Only thing mildly special was the corner lot it sat on. She must have though her outstanding marketing and staging abilities would make her house stand out. Ironically a house across the street, not on a corner lot, was listed for 15k less than hers, and it sold within a month (not sure what they got for it...both houses are on Boxcar in Folsom).

For a while there were several house we had our eye on, but over the last couple weeks the number of vaguely interesting houses has dropped to zero! I think that has been part of my discouragement.

Looks can be Deceiving

I was starting to get bummed out recently because several of the houses I had my eye on went "Inactive" in Ziprealty (they send you a message, its a pretty cool service). It made me wonder if Folsom was already starting to rebound, thus killing my dream of being able to afford a place in 95630. However, after seeing Agent Bubble's stats, I was feeling much better.

Today, I also realized that looks can be deceiving. Turns out, as I was browsing rentals (since we are planning on moving next month) one of the houses that went inactive was up for rent! It wasn't sold after all.....ha. In addition, the house next to me, that is $200 cheaper than my house, is still up for rent (which is why I thought I would do another pulse check on rental prices).

June 2007 Update for Folsom and El Dorado Hills

The Folsom market as a whole seems to be mirroring the smaller sample that I collect each week in my screen scrape. We seem to have hit a plateau. However stats for El Dorado Hills do look a bit more favorable.

In both zips the median home price seems to be actually rising month over month (albeit rather erratically). Looking at the rising median price and the slowly dropping price per square foot, I am guessing that the mix of houses sold is shifting toward bigger houses.

Who can Afford to Live in the "Best Places To Live"?

This week's Village Life reported that El Dorado Hills is number 77 in Money Magazine's "best places to live" and Granite Bay was 74.

They reported that the EDH median family income was around 116K. The median home price was reported to be 672K.

Late last night I had already done some math using a rough average between Folsom and EDH median home price as reported by DataQuick for June 2007. I looked at what the monthly payment on a 550K loan would be, then extrapolated to figure out what the family income would have to be for the monthly payment to be 3x income. I have a range since I wasn't exactly sure how to treat the tax situation.

Results: For a 550K loan (property tax at 1.25% and no HOA) a family would have to make between 145K and 175K!

So just where are these median folks getting the money for their median houses? Its not their income. Must be all those pesky new-fangled loan products!

Its Worse in the West

Reading the fine print of today's existing home sales report by the National Association of Realtors.......

"Existing-home sales in the West dropped 6.8 percent in June to an annual pace of 1.10 million, and are 19.1 percent below a year ago. The median price in the West was $340,000, down 0.4 percent from June 2006."

Nationally sales of single family homes only fell 3.5% and the median home price actually rose 0.1%.

Save the Date - Housewarming in 2008?

I started this blog on a lark, to keep myself sane as we wait for the housing market to enter a more rational phase. I have enjoyed getting to know everyone through their comments. So I would like to extend an early invitation to an Average Buyer Housewarming party.

I really hope it will be sometime in 2008. Will fill you in on the details as soon as I know them.
If there is no reason to party in 2008 (no house to call my own), we might just have to meet at a bar downtown and get smashed.

The Other AB: An Interview with AgentBubble Part 2

When did you first start advising your buyers to hold off on purchases due to a real estate bubble?
It was around the last quarter of 2005. We sold our house in May of 2006 and almost waited too long. I sensed the madness couldn't keep up much longer and began cautioning buyers against buying. One memorable transaction involved a family that had to buy in a newer neighborhood regardless of my advice. They are now in pre-foreclosure and looking a short sale with a difference of about $140,000 that will be written off. About a year and a half ago a former client came to me seeking advice on buying a condo. I told her to wait and gave her some figures supporting my advice. She ended up buying through another agent (100% financing, interest only). The same condo is now $60,000 less. I have one client that calls me every month to check on the market. He also thanks me each time he calls because I was the only person that would tell him to wait on buying.


What is your outlook for the Sacramento Metro area residential real estate market?
I see declines for the rest of this year and probably all of next year. I'd like to say that things will stabilize by the end of 2008, but with the last quarter typically being slow every year, I honestly don't see things at a full stabilization until April of 2009. There's just too much inventory right now and too many upside down sellers for me to think otherwise. I've seen prices in some areas going back to early 2004, so in my opinion we will get back to early 2003 pricing before it all shakes out. Of course, this doesn't mean you'll pick up a home in East Sac for $400,000. Then again, East Sac is only about 2-3% of the market anyway, and I don't make a salary that justifies looking there, so it's a non-issue for me.

What signs should an average buyer look for to know its time to buy (market bottom)?
Make sure it's not a false bottom when you buy. In other words, just because averages and median start up for one month, that doesn't mean the market has turned the corner. A dead cat dropped from a 50 story building will bounce more than once! Personally, I plan on buying again when there's at least a two month increase in the standard statistics that are used to measure the market.

Do you think the sales and inventory statistics accurately capture what is occurring in the market?
I'd say they are pretty close. They're obviously going to be low because of the FSBOs and homes sold at the courthouse steps, but I just don't think the difference is that significant. However, one thing I do wonder about is the volume of foreclosures out there. Our MLS stats for short sales and foreclosures have gone from 1,016 total for the 4 county area in November 06 to 4,031 in July 07. That's a huge jump in such a short period of time. Nearly 1 in every 4 homes listed for sale is either a short sale or bank-owned home.

Is the current real estate business model broken, or do you think 6% commissions will continue to survive?
It's definitely in need of a change. Here's why: Before the explosion in home prices, I could expect to make about $4K or $5K per transaction on average. Then, homes went up in value, and the $100,000 home is now selling for $300,000 in about 3-4 years. Real estate agents didn't provide better service, but they still got that increase in commission since everything is based on sales price. So instead of making $3000 on a house, the agent is now making $9000. Same MLS, same level of service, same advertising (often less because homes sold in days instead of months), same everything. But MORE commission. Doesn't make sense. There's absolutely no reason for someone to pay 6% to sell their home. I've always listed a home for 1% on the listing side and 2.5% for the buying side. If I represent the buyer, it's still only 1%. If there's no listing involved, then I split my commission with a buyer when a home if found. Seems simple enough, but people feel like they have to pay more to get better service. I often tell clients the only difference between my company and the company down the street is the color of our signs.

The Other AB: An Interview with AgentBubble Part 1

AgentBubble, a Sacramento bubble blogger's most admired RE professional, has graciously agreed to do an online interview.

Background: He has been in the industry over a decade and has business training, which means he sees the industry for what it is. Of course my personal favorite, unlike other Realtors who drive fancy cars to make up for their incompetence, AgentBubble drives a socially responsible one. He can be reached at agentbubble at gmail dot com.

What affect, if any, do you think the internet and the widespread availability of public records have had on the real estate market?
It has had a profound effect on the market. Most importantly, buyers now have more tools at their disposal to research a property prior to making an offer. In the past, a buyer would have to rely 100% on their agent to perform research/comps on a property. Now, a smart buyer can know the loan balance of the sellers as well as how long they've owned the property and what they paid for it. At the same time, I think tools such as Zillow have actually hurt some sellers by giving them values on their properties that are too high, causing them to chase the market down and get less than they should have.

Do you think anything has fundamentally changed in the real estate market to make this cycle different from previous ones?
When I started real estate 10 years ago, my first conversation with a buyer would be to tell them to multiply their yearly income by three and that's where the top range for homes would be. A few years later, I'd say they could go up to four times their income with FICO scores above 775. The lenders were on the same page and everything worked out Great. Over the last 5 years, things have changed dramatically for the worse. Buyers with incomes of $75,000 are buying $500,000 plus homes with no money down and interest only loans. I think the blame lies equal on the lender as well as the buyer.

Have you seen a decrease in investor activity? If so how much?
Back in 2002-2004, I'd say half the homes I sold were to investors. Just recently, I looked at the tax records for a JTS subdivision called the Ranch located in Wilton and was amazed at the number of investor owned properties. Most were sold late 2004/early 2005. Now, the investors seem to have left the state. I recently had a house listed at $470,000. It was foreclosed on, and an investor bought it for $340,00 and then sold it for $400,000 two weeks later. He undercut a competing house by $30,000 on the same street and was successful in flipping the property. I'd call this more of an exception than the rule (as evident by the Flippers in Trouble blog).

Do you think there is a lot of pent up demand waiting for prices to come down, or do you think the proverbial "well is fairly dry"?
I wouldn't say a lot, but there are definitely people out there still buying homes, even in areas where it makes no economic sense for the average person. Take Elk Grove for example. In my opinion, that's probably the worst area to buy in right now because of the tremendous number of foreclosures and short sales as well as the fact that the averages/medians have dropped so significantly in such a short period of time. I think the subprime meltdown has done a lot to suppress sales. Also, the fact that so many people are losing their homes has finally sunk in for some people sitting on the fence that have realized maybe they shouldn't be buying a Ferrari on a Toyota budget.

What is your favorite neighborhood in Sacramento and why?
There are three areas I really like. First, I'm a big fan of Carmichael and Fair Oaks. Not a whole lot of tract homes and the homes tend to have larger lots where you can't jump from one roof to the next. It's close to everything including both major freeways as well. Lots of good schools for the kids too. The prices have finally started coming down, so I'm hoping we'll be able to afford that in less than 2 years. I also really like the country land in Galt/Wilton. Owning 10 acres and a farmhouse has always been a dream, but with land prices at $300,000 for 5 acres, it's just not feasible right now.
We almost bought a home in El Dorado Hills last year but pulled out at the last moment. It was a custom home in Waterford going for $740,000. I just saw a home nearly identical on a nearby street going for $655,000. EDH is a great area, but the uncertainty with the asbestos is not something we want to gamble with. I know many have strong feelings one way or another on this issue, but it's just our personal opinion. I certainly respect anyone that chooses to live there.

Action at the Auction

Looks like we will be checking out the Sacramento home auction this afternoon. Will give a report when we get back.

Update: After reading the fine print while the kids were napping we decided it was going to be a waste of time. With all the additional fees we were put off, then we read about the fact that the seller doesn't have to accept the winning bid. How lame is that. Essentially its just a marketing gimmick.

We decided to go check out Orangevale instead. Went to several open houses. Nice established area, but still pretty overpriced for what you get. We also stopped by the Lennar office at Blackstone....will give a detailed report later.

Average-idity

My averageness is starting to wear on me. The very neutral walls and decor of the rental, with no personality to speak of (except my kids artwork which can be taped on). Not to mention, the cookie cutterness of the tract homes where I live.

I am at that point in life where every aspect of my life is average. I really don't enjoy this average-idity, but I can see why us suburban moms end up in this life of convenience. I no longer have time or energy to read interesting books, or explore new places. My only guilty pleasures are this blog, my WSJ, and to some degree my job.

So I lashed out, in the only legal and somewhat funky way I could think of. I decorated my car in the hope, that in some small way, it will set me apart from the crowds of average folks. So if you see me, do drop by and say "hi"

June Month's Inventory by Zip

The moment I await each month has arrived. Monthly sales from DataQuick has been posted by the Sac Bee. Below is the breakout by zip of the month's inventory. The data is not as rosy as it appeared previously. Some of these numbers are considerably lower than previous estimates because I removed the condos and multi family units from my inventory numbers this month. This change essentially shaved a month of inventory off the weighted total calculation (from 8.8 to 7.8).

I have ordered the data by month's inventory to give a better picture of where we stand. There are still 19 zips, or around 35% of the zips, that are below the 6 month mark. For those of you just tuning in, 6 months tends to be the rule of thumb equilibrium between buyer and seller, more inventory favors buyers, while less favor's sellers.

Preliminary Weekly Screen Scrape

Don't have my screen scrape data with me on travel (still in Atlanta), however I pulled my usual Folsom and El Dorado Hills data off www.metrolistmls.com. At first glance, it looks like we have a repeat of last week, not much contract activity, still hovering around 20%, and again the average price per square foot rose of home for sale!

Hmmm funny thing about higher prices.....they don't sell homes. In June prices were coming down, and houses were going under contract the fastest I had seen since I began tracking in February. Now the opposite is occurring, prices are going up, and contract activity has stagnated.

I'm so FRUSTRATED!

I will likely head over to Blackstone this weekend to take a peak at how their sales are doing.

Take me back to '02

Many have noted that we are ready and willing to pay 2002 prices, adjusted for inflation and mortgage rates. Our feelings are also consistent with the Global Insight/National City study that marked 2002 as "just right" (not over or under priced).
Since metro averages are so deceptive, I took the DataQuick resale data from August of 2002 courtesy of the Sac Bee website, and compared it with May of 2007. Keep in mind, a lot has happened in those 5 years. The mix of houses in some zip codes has changed dramatically in some of the suburbs (hence the median price and price per sqft may not track the same).

They are ordered by zip code for easy reference. Zips with over 75% appreciation in the median price are in Red, those between 50% and 75% are in orange, and those with less than 30% (which I consider more or less reasonable when you take into account inflation and interest rates) are in green. Unfortunately only one of those...sigh.

Please note: This data is not adjusted for inflation or mortgage rates, its just the percentage difference between the two medians. Inflation and mortgage rates probably account for 25-30%.....the rest is irrational exuberance.



I threw out zips several zips were the data was sparse.

Finding Rentals

The sidebar has been updated with links to various property management companies as well as other classified sources for Sacramento area home rentals. Thanks everyone for the additional links!

Folsom Stats

Agent Bubble posted some great Folsom stats on the SacRealStats Blog, see his post...... Sacramento Real Estate Statistics: Taking a Closer Look at...Folsom

The picture is not as discouraging as I had recently thought.

Bubble Glossary

I had never read a blog prior to my addiction to the Sacramento Real Estate Blogs. However much of the lingo took some time to figure out. Below is a brief glossary. I hope to add to it as I come across more terms.

Real Estate Lingo -
ARM -Adjustable Rate Mortgage
BB - Bubble Blogger
CAGR - Compound Annual Growth Rate
CC&R - Covenants, Conditions and Restrictions
CDO - Collateralized Debt Obligation
FB - F*cked Buyer
FHA - Federal Housing Administration
FIT - Flipper in Trouble
FSBO - For Sale By Owner
GF - Greater Fool
GFE - Good Faith Estimate
GRM - Gross Rent Multiplier
HB - Housing Bubble
HELOC - Home Equity Line of Credit
HOA - Home Owner's Association
LTV - Loan to Value
MBA - Mortgage Bankers Association
MBS - Mortgage Backed Security
MIL - Mortgage Information Letter
MLS - Multiple Listing Service
MIP - Mortgage Insurance Premium
MO - Mortgage Officer
MSA - Metropolitan Statistical Area
NAR - National Association of Realtors
NOD - Notice of Default
NOT - Notice of Transfer
PITI - Principal Interest Taxes Insurance
PS - Pending Sale
RE - Real Estate
REO - Real Estate Owned
REI - Real Estate Industry
SFH - Single Family Home

General Lingo -
BTW - By the Way
DH - Dear Husband
DW - Dear Wife
FWIW - For What Its Worth
FYI - For Your Information
IMHO - In My Humble Opinion
LOL - Lots of Laughs
MSM - Main Stream Media
NPR - National Public Radio
NYT - New York Times
OMG - Oh My God(Goodness)
ROFL - Roll On Floor Laughing
WSJ - Wall Street Journal

To Take a Test Drive?

Hubby and I have really started to get frustrated with the market here in EDH and Folsom. Prices have been on a plateau for a month or two. As a result, we have begun to seriously consider other areas which have been more responsive to the market conditions.

(Of course as I mentioned in a previous post, this exact situation will eventually lead to softening prices in these more desirable areas as average folks like us decide to look in more affordable neighborhoods.)

So here is our dilemma. We had decided to find a cheaper rental, and the guy across the street was willing to rent out his place for $350 less than we pay now. (He commutes to the South Bay for work leaving his wife, with three young kids in tow, to essentially raise the kids by herself.). Now our neighbor is talking a little more rent, and they have been pushing the date. So we are beginning to think about getting the heck out of Serrano all together, and take a new area for a test drive. The past few months in El Dorado Hills has certainly demonstrated the value of getting to know a neighborhood before committing (similar to dating before marriage....I'm also matchmaker in my spare time =) The only thing holding us back is we really like our daycare and don't want to have to move the kids...sigh.

Taking Advantage

This weekend we plan to take advantage of reason number 5, in why I like Sac. I inadvertently left Yosemite off the list. Its one of the most beautiful places on earth, and is just a couple hours away.




Its the annual family camp trip. This will be our first time with two kids (1 & 3), so we may not get to take in as much of the wonderful scenery. Luckily there will be lots of family to help out.

The Weekly Screen Scrape - The Good and the Bad

While the number of house pending sale compared to available has plummeted back to 20% (it dropped 7% as many houses closed escrow and some fell out), the price per square foot of available houses went up several dollars. This was due to two factors 1) some bargains going into escrow, and 2) new listings at wishing prices.

We are seriously starting to look into other areas aside from Folsom and EDH. Its been several weeks since we have seen houses that were of serious interest (custom homes at sub $200 sqft prices).

Prices in Serrano have certainly dropped over the last 6 months. When we first moved into our rental here, there was nothing in my criteria, now there are around 7 (3 pending sale). Although I do still see some comparable anomalies go at much higher prices. The house next door to us, which has been empty since we arrived in Nov of 2006, went up for rent this week.

Condo Conversion

News articles during the boom mentioned that rental apartments became scarce as they were converted to more profitable condos. Now that the boom is busting....will condos be converted back? Since I went to the trouble yesterday to gather inventory twice (once with condos and multifamily included, and again with only single family homes), I figured I would post the result.
However I don't plan to track this regularly.

Below is the same data from yesterday, however the column on the right is the percentage of current inventory that is either condo or multi-family home. For instance, Downtown Sac (95814) is overwhelmingly condo/multi-family.

A Lot Goes Into an Average

Below is the monthly inventory sweep by zip code. Instead of ordering by the percent change to highlight trends, I have kept the zip codes in order for easy reference. The average 4% growth hides a lot of information.

Important note: When I set all the ZipRealty parameters to defaults for collecting the data, I didn't realize it included condos and multi-family units. The result of this oversight is to over inflate the month's inventory numbers I have reported in the past. I have corrected this to now only track single-family homes.

The percentage change from last month (including the condos and multi-family) and the new SF only inventory is reported below.

The Anti-Socialization of America

Warning – This is a bit long and gets slightly off topic, but I promise to bring it back round to buying a house at the end.
______________________
For most Americans, the most social years of our lives are our youngest years. Up through college, we have regular interaction with others in our ages group. After college, a funny thing happens. We become slowly become more and more insular and withdrawn. How else do you explain the huge explosion in online dating? It’s hard to meet people outside of work these days.

I know I am not alone in longing for the America of my childhood. The days when we left the front door unlocked, and our parents sent us out to play till dinner time. The days when we were allowed to talk to strangers and eat all our Halloween candy. The days when hitchhikers were just folks who needed a lift, and not potential psychos.

So I have taken note of many factors I believe are contributing to this anti-socialization of our communities:

--Our culture is very mobile. People don’t set down roots as much as they used to. It is rare to find someone like my mom who lived in her house for over 30 years. She knew all the neighbors and they knew her.
--Our culture is 24/7. In Europe (at least when I lived there in the ‘90s), the shops were only open in the morning and the afternoons during the week, almost never on the weekends and evenings. This meant everyone was free to spend time together since they all had evenings and weekends off.
--It is rare to find a city center or common place for communities to gather in American cities these days. In Europe, all the young singles would hang out in the city center on Fridays, and the families would stroll around on Sunday afternoons. This activity keeps everyone in close contact and keeps everyone familiar with who lives in their community. Since many folks walk and take public transportation they also interact more.
--Gated community is an oxymoron – These gates are designed to keep people out and there is not anything communal about these developments. These “communities” keep the front lawn manicured, thus you never meet your neighbors as they work on their yards. With some associations, you can’t even park out front, which means, you don’t even get a chance to say hi to your neighbor as they walk to their car. Everyone now has a pool in their backyard as opposed to using a communal pool. The only opportunity you have to meet is at the mailbox! The one thing I enjoyed about the big snowstorms in the East, was that everyone would be out front together helping shovel snow afterwards.
--Our culture, especially post 9/11, has taught us to fear and judge one another. These days, we are afraid to interact with the outside world, discipline others children, or help out someone in need for fear of being sued or shot or yelled at. We are very quick to judge others, calling them stupid, or lazy or fat. Eying them suspiciously and wondering if they are a terrorist. It’s amazing how people feel they can rip each other apart on the internet or e-mail when they would never feel at ease saying those things in person.
--Many people prefer to watch reality TV and Sports in their homes rather than to experience reality and play sports outside their homes. Our TVs have gotten bigger, while our outside lives have gotten smaller.

I think this phenomenon also explains the large growth in the size of American houses. We no longer trust the outside world, so we retreat to our inside world, our houses. Thus they need to grow to accommodate more of our lives.

So where does all this leave me in respect to my house search? It leaves me looking for neighborhoods that have sidewalks for strolling, a local pool for hanging out, and last but certainly not least, no gates. I would love to find the community of my childhood, but unfortunately, I don’t think I will find it here in Sacramento.

A Few Good Rentals

Many of us did the math and sold our homes in 2005 & 2006 opting to wait out the bubble. Unfortunately there is no MLS for finding rentals. So I have compiled a list of property management and classified adds for a rentals in the Sacramento area.

Classifieds
Sacramento Bee
CraigsList

Local Property Management Companies
PPM4U
Homepoint
Capital Management
GBR

This is not a very comprehensive list, so please e-mail or comment if you have additional links. I will post these on the sidebar soon.

Inventory Interaction

Interactive graphics courtesy of my favorite paper.......WSJ. Although the inventory number for Sacramento looks way high. I'm thinking they might have mixed up Sacramento with Orange County.

Weekly Screen Scrape - Nothing of Note

Nothing really going on this week. More and more properties feature the "bank owned" statement in their description.

I need a new obsession. This one is getting kinda boring.....Its like watching a flower bloom, a wonderful thing, but if you show up at the right time, you still get the same reward. Hopefully the coming weeks will bring some more dramatic price drops.

Its all Fun and Games Till Someone Gets Hurt

I really liked an idea posted a while back Lander’s blog. They suggested giving a free credit walk to that first time homebuyers that got in over their heads during this bubble. My husband and I are both college educated professionals, and with our first home purchase we really put a lot of trust into our agent and mortgage broker. At the time I tried to do internet searches on “average closing costs” and the like, but it rarely turned up good information. They certainly don’t teach this type of stuff in school, so I can see how many average folks ended up in trouble, watching prices skyrocket and fearing they would be priced out of the market. In addition, many of the first time buyers are young or new to the country and have never been through a housing bust, so they don’t have the same perspective of those who have been around a little longer

Now for all the flippers and speculators out there who jumped into the market hoping to make a killing (and the members of the real estate industrial complex that enabled and fueled their behavior)…..they deserve what they get. I am not trying to be mean or spiteful here. . We would never deny them the riches they would have made, so why should we feel sorry for their losses. Let’s call it what it is…they were taking a risk, gambling with money they didn’t have, and they lost this time.

There is no such thing as free money. Although from 2002-2005, I can see how some were fooled into thinking there was.

MelissaData for June 2007 - Folsom & El Dorado Hills

As I have mentioned every time I post this data.....it doesn't seem very stable (they use averages so the data is subject to large swings). But at least this month, the swings are moving in the right direction for those of us who are renting!