Keller Williams Realty

I'm proud to let you know that I have returned to Keller Williams Realty in Mission Viejo. Effective today I have formed a team with Scott White, a great friend and excellent REALTOR. Our office is at 27101 Puerta Real in Mission Viejo. We will still be covering all of Orange County and the surrounding areas. All of my contact information remains the same. My web address is http://www.lenherman.com or http://www.len4homes.com . With my new team in place I look forward to providing my clients an even higher level of personalized service. Feel free to call or email me.

OCAR Board of Directors

I just wanted to take a moment to let my friends, family & clients know that the Orange County Association of REALTORS^® Board of Directors election have concluded. I have been elected to a 3 year term as a Director. I'm looking forward to serving the community of REALTORS^® and helping to do my part to protect property rights for homeowners.

I will also continue to serve as the Chair of the MLS throughout the rest of this year or longer if asked to serve.

2009 & Looking Forward to It

I'm writing this blog at the beginning of the new year while looking back on 2008. Our real estate market place saw some serious challenges over the past year or so, as did the economy as a whole.

The good news is that interest rates continue to fall, there is still plenty of inventory from which buyers can choose. The banks seem to be getting a little easier to deal with on Short Sales, maybe just an illusion, but I can remain hopeful. It also seems like there are more loan modifications happening which should result in less foreclosures.

Personally, I recently found out that I was one of three recipients of the OCAR President's Award. This was both an honor and a surprise. This year I continue my roles as MLS Chair for OCAR (Orange County Association of REALTORS), and a SOCAL MLS Director. This is also my freshman year as a C.A.R. Director, and I'm looking forward to serving.

In closing, make 2009 the Best Year of Your Life!!!

The Economic Week in Review

Wild swings and ill winds
It was another white-knuckle week for investors, with the leading stock indexes soaring, plummeting, and soaring again in rapid succession. There were few real surprises in the week's major economic reports, however, with most indicators simply confirming what Americans already know: The economy is weak and seems to be getting weaker. For the week, the S&P 500 Index rose 4.6% to 940.6 (for a year-to-date total return of –35.2%). The yield of the 10-year U.S. Treasury note rose 8 basis points to 3.94% (for a year-to-date decrease of 14 basis points).

A bleak assessment from the Fed
In its latest "beige book" anecdotal survey of economic conditions across the country, the Federal Reserve offered a grim survey of the impact of the credit crisis. For the six-week period ending in early October, the Fed found contraction almost everywhere it looked. All 12 Fed districts reported broad-based slowdowns in business activity and consumer spending. Manufacturing took a turn for the worse, capital expenditures declined, tourism dropped, interbank lending fell off, and the real estate market extended its long slump.

Some good news on the inflation front
With crude oil prices continuing to fall, the outlook for inflation brightened in September. Producer prices for finished goods declined 0.4%—their second monthly retreat in a row. Prices dipped at all intermediate stages of production as well. With volatile energy and food prices factored out, "core" prices for finished goods were up by 0.4% for the month and 5.4% (annualized) for the quarter. On the consumer side of the equation, prices were flat in September, held down in part by a 1.9% decline in energy costs. (Still, gas prices remained up 31.7% from where they stood in September 2007.) With energy and food excluded, "core" consumer inflation was up 0.1% for the month and 2.7% (annualized) for the quarter.
"The good news is that these inflation numbers will be a positive force in sustaining consumers' purchasing power," said Vanguard economist Roger Aliaga-Diaz, Ph.D. "The bad news is that behind these numbers there are softening global demand for commodities and prospects of slower economic activity."

Retail sales weaker than expected
Even with the inflation threat easing, consumers weren't in much of a mood to spend in September. Total retail sales were down 1.2%, double the expected decrease, and August's decline was revised downward to –0.4%. Sales of big-ticket items such as autos, furniture, and appliances dropped significantly, as did sales of clothing and accessories.
Business inventories up slightly
Business inventories grew by a smaller-than-expected 0.3% in August, held in check by declines in retail inventories, particularly at car dealerships. The total inventory-to-sales ratio (a gauge of how many months it would take to empty out existing inventories at current sales levels) stood at 1.27 in August—a slight increase over July, and another indication of sluggish retail activity.

A big drop in industrial production
Industrial production contracted more than expected in September, falling 2.8%. Recent hurricanes and a strike at Boeing were partly to blame, but analysts noted that U.S. industrial activity as a whole has been anemic for many months. The mining sector took the biggest hit in September, dropping 7.8%. For the third quarter, total industrial production was down a staggering 14.5% on an annualized basis.

Another poor month for housing
There was more bad news for the beleaguered housing market in September. New residential construction starts were down 6.3% from August, hitting a 17-year low. Although multifamily housing units advanced 7.5% for the month, that increase was offset by a 12.0% drop in single-family homes. Overall, housing starts declined 31.1% from September 2007. Permits for new construction, a key measure of future demand, were down 8.3% in August and 38.4% over the past year. "This sharp drop in housing starts, paired with the increasing inventory of unsold homes, tells me we should be prepared for significant price declines in the months ahead," Mr. Aliaga-Diaz said.

The economic week ahead
The Conference Board's index of leading economic indicators is likely to grab the most attention in what will be an otherwise light week for economic reports. Also on tap are September's figures for existing-home sales.

Volunteering at Homes for Heroes

OCAR, my real estate association, is one of the sponsors of Habitat for Humanity's local Homes for Heroes build in San Juan Capistrano.

This week I had the opportunity to volunteer my time and energy at the project site. Being involved in building one of these homes was a fantastic experience. For a full day I worked as a plumber, cutting and threading pipe. It was hard, hot work which really made me appreciate my air conditioned office and comfortable chair. However, I wouldn't have given up that day of work for anything.

There were about 50 or so other volunteers working on various aspects of the project. They all were making a difference for families that really need our help. In our case we were building homes for wounded veterans.

If you have a chance to work on a Habitat Humanity, take it. It feels so good to make a difference.

Back to Prudential

I'm proud to announce that this week I changed my brokerage affiliation back to Prudential California Realty in Laguna Niguel. I'm excited to be back where it feels like home. My phone number, email and web address remain the same. My new address is:

Prudential California Realty

29982 Ivy Glenn Drive, Suite 100

Laguna Niguel, CA 92677

If you get a chance, stop by or call and say hello. I look forward to speaking witih you.

Short Sales

A real estate short sale is when the amount due in loans on a property exceeds the amount the property could be sold for.

Know your property value

Your REALTOR® will provide you with an estimate of your home's value in today's market. If you are selling the home yourself you will have to prepare your own market analysis for your property and the surrounding area.

Calculate your Closing Costs

Your REALTOR® will provide you with an estimate of your closing costs. If you are selling your home yourself have your Title company or Real Estate Attorney what your closing cost will be.

Determine how much you owe on your home

Total all of the loans on your property.

Calculation Time

Subtract the total amount you owe on your home from the estimated proceeds for your sale. The higher the positive number the better off you are. However, if this calculation yields a negative number then you have a Short Sale and move on to the next step.

Contact Your Lender(s)

Explain your situation to your bank's customer service department. This will not be their first call of this type. You will most likely be directed to to a specific department that the bank has set up to deal with short sales. Try to talk to a supervisor or manager; they will have more authority, training and experience.

What are Your Lenders Procedures?

This is where you will find a great amount of variance between lenders. Some lenders are willing to work with you to resolve the issue. They may offer to recast the loan with lower payments over a longer time period. They may offer loan forbearance for some time period, adding the missed payments and interest on to the back of the loan. The lender may settle for a reduced amount owed on the loan and allow you to sell the home for less than is owed. Other lenders may tell you the debt is your responsibility, period.

Sell the Home

Keep in mind however, that on certain types of loans the lender may require to make up the difference either by a personal note or thru collection.