Nearly every day people ask me the same question relative to home values: “Are housing values at the bottom yet?”  The answer varies depending the area you are asking about.

In this article Forbes provides mixed answers:  homeowners in the San Francisco Bay Area may “be there”.  Other places in CA and around the country, however, may have a ways to go yet before their house-value-slide ends.

San Jose was specifically listed as one of the few metro area where values seem to have leveled.  This continues to be good news for Morgan Hill, Gilroy and Hollister home values.  With the majority of South County residents commuting up into the Bay Area, home values in these three cities will continue to follow San Jose’s lead.

So, Johnny, we’re there –  but we won’t be returning to increased values for some time to come.

The seller had no money.  Our buyer could not pay for any of the repairs.  The listing agent and I had already agreed to put up a portion of our commissions toward the cost.  Yet there remained a list of repairs to do.  At the close of escrow no more options were available.  We were at a stalemate.  

The seller offered to help to fix a couple of repairs with materials he already had.  I took the remaining list of items and figured out a plan to get them done.  I bought the necessary supplies, rounded up 3 others and on the Saturday before it was to close we spent 7 hours doing those repairs. 

With Western Exterminator’s pre-set re inspection on Monday morning and e-mailed clearance to the lender that same day we funded on the very last day possible. IT CLOSED!  The seller was freed up. My buyer bought a great home at a great price.  The listing agent and I got a little bit for our 4 months of work. Everybody came out okay.

Winston Churchill’s famous, 5 word speech comes to mind: “Never, never, never give up”.

This bright and sunny home is only 40 min. from San Jose, 13 miles from Gilroy’s Outlets and CalTrains; 4 miles from San Juan’s village and schools, 20 min. to the beach and a little further to Monterey.

As you watch the VIDEO Tour (above) of this great home look for all of the natural light, large oak trees, and the home’s quality. 860 Merrill Rd is located at the end of the lane, about a mile up from Hwy 101.

You can also click on the “City Tours” tab above to see a VIDEO Tour of San Juan Bautista as well.

In addition to the 4 large bedrooms, 3 full baths, over sized 3 car garage and 3,149 sq. ft., the energy efficiency, privacy and great location of this home will make you glad you found it.

860 Merrill will be going on the market in a few weeks.  Call or e-mail me for your own, personal tour of this wonder country home.

I welcome your comments here.

When we do look back and consider the cyclical nature of the housing market we’ll see that the peaks and valleys are very predictable.

So when I came across this presentation I was impressed.  I began thinking: “Let’s see, how can I buy another home?”

A contrarian, by definition, buys when the masses say not to and sells when others are buying.  It is not coincidental that successful investors march to their own trend-studies and, not do follow the mass media’s reactionary reporting.

So. What do you think?  Ready to brave the storm and buy a home?  Everyone else is selling.  I know just the expert who can help you.

If you have been waiting to refinance your current home today is the day.

Neither these rates nor the sale prices will remain down here much longer.  Some day soon the bills for “CHANGE” will come due and we’ll see the rates begin to rise.

Look at this AP article for more details.

Gilroy home values have already bounced off the bottom.  Likewise, Morgan Hill and Hollister homes have seen a balance in demand and supply.

Time for your co-workers, friends and family to make their move.

What do you think?

Ah man! I’m getting

That was the approach some agents were taking earlier this year.  Many are still.  Finally, however, the banks have gotten wise to this ‘blue sky’ approach. 

I made an offer for a prospective buyer on a nice Ridgemark home in Hollister.  The listing agent informed me there were 4 other offers and 2 were considerably higher offers than ours.  Reluctantly the buyers did not want to try again on this home. 

What was fascinating however, was the bank countered that the offerees had to agree to pay for the amount over and above the appraised value when it came in.  I like that!  Finally, some intelligent approaches to this frenzy we’re seeing in the starter-priced homes.  If the accepted offer was, say, $350,000, but the appraisal came in at $325,000 the buyer would have to pay $25,000 over and above the appraisal.  Of course their loan amount is computed from the appraised value or sales price, whichever is lower. They would pay their down payment PLUS the amount over value.

Hopefully, more banks will begin handling the question of value up front in this manner rather than 3 weeks later when the other prospective buyers have moved on and the appraisal comes in low.

So, what do you think?  Will this smooth out the ‘offering’ process some?

I sat them down and shared what many homeowners have learned over the years.  Your accountant can tell you what your new tax liability will be if you buy that tempting home.  In most cases the amount  you will be required to pay in income tax will DROP because of the larger amount paid toward interest and taxes.  Some of us have figured that it is better to reduce our income tax withholding from our paychecks each payday rather than get our refund in a lump sum (with no earned interest) at the end of the year. 

Here is their example:  Sales Price: $650,000; New VA Loan: $591,800; Total Principal, Interest, Taxes and Insurance: $4,210; Income Tax Deduction at a 26% tax bracket: $898/mth; Net “House Payment” after income tax deduction: $3,312. 

Same home, same terms but a house payment that feels like $3,312.  That made the difference.  They will simply need to take a new W4 form to their employers and have them reduce their withholdings by $898 so they will have that much more to take-home each month.  While they still make the actual payment of $4,210 the additional take-home pay makes the leap in house payment more palitable. 

They will break even at the end of the year: they won’t owe much income tax nor will they get much of a refund.  HOWEVER, they will have received their refund during the year to help offset their new, higher payment. 

Everybody was happy and moved forward with what they really wanted to do. 

I love solving problems for people!  Have you done this yet?

This is what I deal with often – not in cars but Veteran’s Benefits.  Many so-called VA Lenders fail to ask one simple question of every Veteran. “Do you receive any disability pay from the VA?”  The failure to ask that question costs disabled Vets thousands of dollars unnecessarily.  

Let’s say a Vet buys a $300,000 home and uses their Eligibility for a no-down VA.  If that Vet  receives disability pay, he/she does NOT have to pay the “VA Funding Fee”.  A first time user of their VA Home Loan benefit has a Funding Fee of 2.15% of the VA Loan amount.  So, our $300,000 sales price and VA Loan amount would have a $6,450 Funding Fee as part of the Veteran’s costs.  HOWEVER, if the Lender asks that question and does the proper paperwork for the disabled Vet, the Veteran’s Administration will waive that $6,450 VA Funding Fee.  Good news for the 267,318 disabled CA vets (3,268,045 nationally).

“It’s who you know that makes all the difference in the world”.  That is true. But even if your Uncle Bob is an auto dealer, if he doesn’t know that your situation has benefits we have to tweak the slogan: “It’s not just who you know but what they know that counts”.  

Do you know of any such situations?  I’d love to hear from you.

‘Houston…the Eagle has landed’

Home values in San Jose, Morgan Hill, Gilroy, Hollister and San Juan Bautista “have landed” at the bottom of their value slide and are beginning to “lift off” that bottom.  We are not going to see these prices again for a very, very long time, if ever again. 

Here’s the affect of waiting to buy a home: A home listed today for $350,000 and goes up 5.0% in value will then be worth $367,500.  A buyer who waited and then buys this home will need $985 MORE CASH and $268/mth MORE INCOME to qualify for this same home. 

If the  interest rate is at 6.0% (vs. the 5.0% used above) when the buyer decides to purchase this increased-value-home, their income will need to be $843/mth. HIGHER to qualify!

Some prospective home buyers may be calling out: “Houston, we’ve got a problem“.  The erosion of their purchasing power may make them permanent renters. 

My crystal ball recommends that those who want to buy a home climb on board NOW while they can.  What does yours forcast?