Parsons Realty

“It’s first-time homebuyers taking advantage of programs, low-interest rates and some pretty good inventory,” Shasta Association of Realtors board member Greg Lloyd said Thursday.

DataQuick Information Systems reported that 158 new and used homes were sold in May, a 20.6 percent jump from April’s total of 131. There was one more home sold last month than in May 2008, DataQuick reported.

The 158 closed escrows last month were the most since October, when 168 homes were sold in Shasta County.

After experiencing an 18.6 percent month-over-month jump in the median sales price in April, sales fell last month.

The median sales price in Shasta County in May was $181,000, down from $210,000 in April. The median sales price in May 2008 was $246,000.

More than half the homes sold in Shasta County last month were priced at $200,000 or less, according to Shasta Association of Realtors’ statistics.

The group reported that 162 homes sold in May, up from 133 in April.

The Shasta Association of Realtors relies on its members to report sales. DataQuick gets its numbers from the county recorder’s office.

“I would say a preponderance of foreclosure properties are down in the lower price range,” Shasta Association of Realtors board member Brad Garbutt said.

Nearly 37 percent of the used homes sold in May in Shasta County were bank repossessions, DataQuick reported.

Garbutt estimated some of those lower-end homes are selling for half of what they fetched during the market’s peak at $300,000 in March 2006.

Experts like Joel Singer, executive vice president of the California Association of Realtors, have speculated that statewide, the low end of the market is getting the attention because move-up buyers have no equity to sell, Garbutt said. That’s true in Shasta County, too, he said.

“They have the desire to improve their homes, to move up … but they find out their house is not worth anything close to what they thought and it takes them out of the market,” Garbutt said.

Wayne Martin of Real Estate 1 in Redding said that in addition to first-time homebuyers, investors also dominate the market.

“What we saw, I believe, is that people finally got tired of waiting and they entered the market,” Martin said of May’s uptick.

Martin estimates there’s a backlog of bank-repossessed properties ready to hit the market. His office recently was assigned seven bank repos to sell.

“I think we will see a dramatic increase in REO (bank repos) activity in the next 60 to 90 days,” Martin said.

Ironically, a 90-day state moratorium on foreclosures took effect earlier this month. The stay applies to first mortgages made from 2003 through 2007.

Meanwhile, the average interest rate in May for a conventional 30-year, fixed-rate mortgage on loans of $417,000 or less was 4.88 percent, the Federal Housing Finance Agency reported Thursday.

But rates have recently climbed.

The Mortgage Bankers Association said Thursday on its Web site that rates for a 30-year mortgage averaged 5.5 percent.

“If you have a little bit of money, some support, a good job and good credit, it’s a great time to get in,” Lloyd said.

The economy and Shasta County’s increasingly affordable housing market now are causing a downturn in the area’s rental market.

Banners advertising space for rent or lease are plentiful along Redding’s Hilltop Drive as landlords look to fill empty units.

"We see a lot of people losing their jobs. They have to relocate or find something much smaller," said Michelle Connaught, business manager for River Knolls on Hilltop Drive. "Right now, all of Hilltop Drive has been hit hard."

The number of people looking for apartments on Hilltop Drive has declined since the beginning of the year, Connaught estimated.

With its panoramic views of Redding and the Sundial Bridge, River Knolls typically has a waiting list. But Connaught has found it increasingly difficult to fill vacant units.

River Knolls recently dropped monthly rents $50. Rents range from $800 to $1,120 a month.

"There’s not enough traffic because there is not enough work," Connaught said of people looking for rentals.

Shasta County’s unemployment rate in February was 16.2 percent, the highest for any month in 16 years.

"Three weeks ago, we were fully occupied. Now we have notices. It’s just turned around," said Linda Morrison, who manages Redding Hilltop Apartments on Hilltop Drive, where rents run $630 to $640 a month for a one-bedroom.

"People are moving into two bedrooms with a roommate to save money or they’re moving back home, or out of state."

But job losses are not the only reason vacancies are up in some areas.

The Shasta Creek Apartments in Redding have about 20 vacant units, roughly a fifth of the complex. Manager Thomas Turner said some residents are leaving because they’ve purchased a home.

"We just lost five residents who bought a home," Turner said.
The number of people who can afford to buy a home in the Redding area has reached nearly 50 percent, according to the most recent National Association of Home Builders/Wells Fargo Housing Opportunity Index.

Of the new and existing homes sold in the fourth quarter of 2008, 48.8 percent were affordable to families earning Redding’s median annual income of $53,300, the index reported.

The median sales price in Redding from October to December of last year was $195,000, down from $209,000 the previous three months.

But the declining housing market has affected the rental market in other ways.
Walt Swift of Swift Properties in Redding said homeowners who can’t sell but don’t want to reduce their asking price are opting instead to rent their places out.

"We get a slug of calls every week from people who can’t sell," Swift said. "We are talking upwards of $500,000 homes, or at least they paid $500,000 for it, but they can’t get that."

North state property management firms, too, are renting homes and apartments to families who have lost their property to foreclosure.

Chad and Kerryann Barnes were in Redding this week to look at homes to rent. The Barnes, who have two children, are renting in Fresno after losing their home in Los Banos last August to foreclosure. They’re moving to the north state for a new start.

The Barnes want to rent a home on property for about $1,800 a month.
"There’s a ton available and at a decent price," Kerryann Barnes, 33, said.
Chad Barnes, a 34-year-old California Highway Patrol Officer who’s transferring to Weaverville, said in one day they looked at 10 attractive rentals that were available.

"We will be up here in the middle of June," he said.

North state property managers said that being foreclosed upon doesn’t necessarily mean a family won’t make good tenants.

"I’ve rented to a lot of people who’ve lost a home in foreclosure," said Deborah Sain of Hubbub Properties in Redding. "Those can actually be good tenants: They are previous homeowners, they realize what they can afford, they can pay on time and they’ll take care of the place."

Swift said occasionally his firm will encourage a family who’s lost a home to foreclosure to write a letter explaining their situation.
"We will present the letter with the application," Swift said.

“The extensive foreclosure efforts on the part of lenders and government agencies appear to have impacted the January numbers — particularly the Fannie Mae and Freddie Mac moratorium on all foreclosure sales that was extended through the end of January along with Florida’s voluntary 45-day freeze on all new foreclosure actions and scheduling of foreclosure sales that was announced at the beginning of December,” said James J. Saccacio, chief executive officer of RealtyTrac. “January REOs, which represent completed foreclosure sales to the foreclosing lender, were down 15 percent nationwide from the previous month. And in Florida overall foreclosure activity was down 20 percent from the previous month.”

Nevada, California, Arizona post top state foreclosure rates
Nevada foreclosure activity in January decreased 4 percent from the previous month, but the state continued to register the nation’s No. 1 foreclosure rate, with one in every 76 housing units receiving a foreclosure filing during the month. Foreclosure filings were reported on 14,444 Nevada properties in January, up 137 percent from January 2008.

California posted the nation’s second highest state foreclosure rate in January, with one in every 173 housing units receiving a foreclosure filing during the month, and Arizona posted the nation’s third highest state foreclosure rate, with one in every 182 housing units receiving a foreclosure filing during the month.

Despite a 20 percent month-over-month drop in foreclosure activity, Florida posted the nation’s fourth highest state foreclosure rate, with one in every 214 housing units receiving a foreclosure filing during the month.

Other states with foreclosure rates ranking among the nation’s 10 highest were Oregon, Illinois, Michigan, Georgia, Idaho and Ohio.

California, Florida, Arizona post highest foreclosure totals
Foreclosure filings were reported on 76,761 California properties, the most of any state despite a 14 percent decrease from the previous month. The state’s foreclosure activity in January still increased 34 percent from January 2008.

Florida’s 40,770 properties receiving foreclosure filings in January was the second highest total of any state, and Arizona’s 14,674 properties receiving foreclosure filings was the third highest total of any state.

Illinois foreclosure activity in January increased 16 percent from the previous month, giving the state 14,447 properties with foreclosure filings — the fourth highest state total. One in every 363 Illinois properties received a foreclosure filing in January, the nation’s sixth highest foreclosure rate.

Nevada, Michigan, Ohio, Georgia, Texas and Virginia also reported foreclosure totals that were among the nation’s 10 highest.

California, Florida, Nevada cities post top metro foreclosure rates
California cities accounted for six of the top 10 metro foreclosure rates in January among metro areas with a population of 200,000 or more. Merced, Calif., posted the top metro foreclosure rate, with one in every 59 housing units receiving a foreclosure filing during the month — nearly eight times the national average.

Other California metro areas with foreclosure rates among the top 10: Riverside-San Bernardino at No. 4 with one in every 81 housing units receiving a foreclosure filing; Modesto at No. 5 with one in every 84 housing units receiving a foreclosure filing; Stockton at No. 6 with one in every 86 housing units receiving a foreclosure filing; Vallejo-Fairfield at No. 7 with one in every 100 housing units receiving a foreclosure filing; and Bakersfield at No. 8 with one in every 120 housing units receiving a foreclosure filing

Two Florida cities posted foreclosure rates among the top 10 metro foreclosure rates: Cape Coral-Fort Myers at No. 3 with one in every 80 housing units receiving a foreclosure filing and Port St. Lucie at No. 9 with one in every 123 housing units receiving a foreclosure filing.

With one in every 63 housing units receiving a foreclosure filing, the Las Vegas-Paradise, Nev., metro area posted the second highest metro foreclosure rate in January. The Reno-Sparks, Nev., metro area posted the 10th highest metro foreclosure rate, with one in every 128 housing units receiving a foreclosure filing. Reno-Sparks was the only metro area in the top 10 that did not experience a month-over-month decrease in foreclosure activity, but all of the top 10 saw year-over-year increases in activity.

The petition, organized by Foreclosureu.com based in Rogers, Minnesota, a suburb of Minneapolis, says banks are unfairly limiting which real estate agents can sell REO properties. The petition says 0.006 percent of the nation’s real estate agents sell 95 percent of available REO properties in the country.

According to the petition, “The lenders disposing these real estate assets have made it exceedingly difficult and in many cases impossible, for the vast majority of Realtors to fairly compete for this business…With many markets around the country being totally dominated with foreclosure sales only, the rest of the industry of over 1 million Realtors has nothing left to compete for.”

The group called the bank actions “unfair, inefficient and anti-competitive,” but said they were tolerated when the government did not have a stake in the institutions. But now that banks that have REO properties are receiving TARP funds, those practices should change.

In a press release, the group said, “Now that the American taxpayer has a direct interest in a large number of these banking institutions, Realtors have acquired a legitimate say in how these institutions distribute this business.”

The petition calls for legislation that would require “fair and proportionate” distribution of REO listings to real estate agents that want to compete for work.

The petitioners hopes to get 100,000 signatures, and the petition will be sent to the members of Congress on March 1.