Orange County Real Estate Community

Keller Williams Realty

2009-06-23T21:46:00.000-07:00

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

2009-05-20T15:08:00.000-07:00

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

2009-01-07T12:47:00.000-08:00

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

2008-10-19T16:23:00.000-07:00

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

2008-10-09T13:26:00.000-07:00

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

2008-09-10T16:35:00.001-07:00

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

2008-03-17T14:47:00.000-07:00

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.

Economic Week in Review - February 15, 2008

2008-02-16T20:50:00.000-08:00

Trade deficit shrinks, retail sales up
Economic news has been gloomy lately, but this week there were some encouraging signs. Reports showed better-than-expected retail sales and a reduced U.S. trade deficit. Still, in Senate testimony, the Federal Reserve chairman described the economy as "sluggish," and he also left the door open to additional cuts in the federal funds rate. On Wednesday, President George W. Bush signed into law a $168 billion package aimed at stimulating the economy through tax rebates. For the week, the S&P 500 Index rose 1.4% to 1,350 (for a year-to-date total return of –7.8%). The yield of the 10-year U.S. Treasury note rose 12 basis points to 3.76%.

U.S. trade deficit improves
The U.S. trade deficit narrowed 7.0%, to $58.8 billion, in December (from $63.1 billion in November). Analysts had expected a trade deficit of $61.6 billion. Exports rose by $2.2 billion, while imports declined by the same amount. The weakness of the dollar relative to other currencies was credited with helping to cut the trade deficit. For the year, the trade deficit declined by $46.9 billion, or 6.0%.

Retail sales rebound
Retail sales climbed 0.3% in January, recovering from a 0.4% drop in December. Analysts had expected a 0.3% decline. Gas stations had the strongest growth, with sales up 2.0%. Sales of automobiles and parts were up 0.6%. Excluding gasoline and autos, however, sales were unchanged.

Stimulus package enacted, rebates to come
President Bush signed an economic stimulus package that provides tax rebates to millions of households. Many single filers will receive $600, while many married couples will get $1,200. The rebate amounts, however, begin to phase out for individuals with incomes over $75,000 and for married couples with incomes over $150,000. The IRS will start mailing rebate checks in May.

Fed chairman: Further rate cuts possible
In testimony to the Senate Banking Committee on Thursday, Federal Reserve Chairman Ben S. Bernanke said, "Downside risks to growth remain, including the possibilities that the housing market or labor market may deteriorate to an extent beyond that currently anticipated." The Fed is open to further reductions in the federal funds rate "as needed to support growth," he said. Mr. Bernanke also said he expects "a somewhat stronger pace of growth starting later this year" as the effects of the stimulus package and Fed rate cuts take hold. Since September, the Fed has reduced the federal funds rate, which greatly influences the cost of borrowing for consumers and businesses, by 2.25 percentage points.

Business inventories head higher
December's business inventories grew 0.6%, boosted by increases in the manufacturing and wholesale sectors. Retail inventories nudged down 0.1%, fueled by a 1.6% slide in auto inventories. Excluding autos, retail inventories were up 0.7%.

Industrial production ekes out a gain
Industrial production in January inched up 0.1%. Manufacturing sector output was unchanged, while utility output climbed 2.2%. Capacity utilization in the industrial sector was 81.5% compared with the historical average of 81.0%.

The economic week ahead
Next week's reports will include a reading on the outlook for the economy with the release Thursday of The Conference Board's index of leading economic indicators. Also due are the latest reading on the Consumer Price Index (Wednesday), a report on new residential construction (Wednesday), and the minutes from the January meeting of the Federal Open Markets Committee (Wednesday).

Economic Week in Review - January 11, 2008

2008-01-12T10:08:00.000-08:00

Trade deficit widens, Fed open to more rate cuts
The U.S. trade deficit widened in November, hitting its highest level in more than a year amid then-record oil prices. In other economic news, the chairman of the Federal Reserve said the Fed is prepared to make additional interest rate cuts to stimulate growth. For the week, the S&P 500 Index fell 0.8% to 1,401. The yield of the 10-year U.S. Treasury note fell 6 basis points to 3.82%.

U.S. trade deficit hit 14-month high
The U.S. trade deficit—the gap between the total value of imports and exports—grew 9% to $63.1 billion in November from $57.8 billion in October. It was the biggest trade gap recorded since September 2006, according to Commerce Department data. Analysts attributed the wider deficit, in part, to higher import prices for oil. Overall, imports rose by $6 billion, while exports were up $600 million. Compared with a year ago, the trade deficit is up $4.7 billion, or 8%.

Chairman Bernanke: Fed ready to make 'substantive' rate cuts
Citing concerns about a weakening economy, Federal Reserve Chairman Ben S. Bernanke said in a speech Thursday that he's open to further reductions in the federal funds rate, which greatly influences the cost of borrowing for businesses and consumers. Mr. Bernanke said the outlook for 2008 "has worsened and the downside risks to growth have become more pronounced." The Fed chairman said he is especially concerned about what appears to be a further decline in the demand for housing caused in part by continuing troubles in the mortgage markets. "We stand ready to take substantive additional action as needed to support growth and provide adequate insurance against downside risks," he said. The Fed cut rates on three occasions last year for a cumulative reduction of one percentage point in the federal funds rate. Fed policy makers next meet January 29 and 30 to vote on interest rates.

Consumer borrowing rose sharply, exceeding expectations
U.S. consumers ramped up their borrowing in November as consumer credit outstanding rose by $15.5 billion from October's number to $2.5 trillion. The increase—7.4% on an annualized basis—was nearly twice the $8 billion that had been forecast. Revolving debt, primarily credit card borrowing, jumped at an 11.3% annualized rate. Analysts said the housing slump has increasingly forced consumers to rely on credit cards because it's now more difficult to get home equity loans. Nonrevolving credit, primarily auto loans, climbed at a 5.1% annual rate, after declining 3.5% in October.

The economic week ahead
A busy week for economic news will include the latest readings on two closely watched inflation gauges—the Producer Price Index (Tuesday) and the Consumer Price Index (Wednesday). The release on Friday of The Conference Board's index of leading economic indicators will provide a reading on the outlook for the U.S. economy. Also due are reports on retail sales (Tuesday), business inventories (Tuesday), industrial production (Wednesday), and new residential construction (Thursday). Analysts will also await the Wednesday release of the Fed's Beige Book.

Welcome to 2008

2008-01-08T16:44:00.000-08:00

The best thing that can be said about 2007 is that it is over. What lies ahead for the Real Estate Community in 2008?

We are one week into the new year and I am extremely optimistic. This weekend I held an Open House at a Fantastic Home (3 Sierra Vista, Laguna Niguel). The weather was terrible but the Open House was very well attended. The people visiting were optimistc about the market and planned to buy home in 2008.

Real Estate Prices

2007-11-28T16:18:00.001-08:00

What if the Real Estate Market actually was a roller coaster...

Has the Recovery Begun?

2007-11-26T08:06:00.000-08:00

Every week my clients, friends, neighbors and associates inquire about the Real Estate Market. For the longest time there hasn't been any good news. However, this week the Market seems to be improving. Now, this is not based upon statistics or polls or anything more scientific than just a "seat of the pants" indicator.

As I spoke with other Realtors this last week I learned that many of them had Buyers enter into escrow on home purchases. This is the first time in a while that I can point to several new escrows in the same week. Not to be outdone, I also have Buyers that purchased a home this weekend

Let me know what you think...

10 Reasons the Housing Market Will Begin to Recover 2nd Quarter 2008

2007-10-30T19:16:00.000-07:00

The Federal Open Market Committee (FOMC) Will Continue to Lower Interest Rates - This will continue stimulating the economy, keeping unemployment low in addition to helping ARMs reset to lower interest rate.

The Economy is Creating Jobs and Unemployment is Low - The last two housing downturns were due to recessions in the U.S. economy (80-81, 90-94)

Lenders are Helping Homeowners with Loan Modifications on ARM Resets - This will decrease the number of homeowners needing to sell or going into foreclosure

Subprime ARM Resets Peak in 1st Quarter 2008 with Minimum Resets by Year End - The credit markets froze in fear of these resets. Once past, more credit markets will make money available

Home Builders are Dumping Standing Inventory to Remove Inventory off the Books by Year End - The competition to the resale market will be greatly reduced

Sellers of Existing Homes Will Take Their Homes Off the Market at Year-End that Don’t Need to be Sold - Combining this with those that need to sell and lowering their sales prices during the holiday slow period, will cause the months to sell inventory to come down

Credit Markets for Jumbo Financing are Opening Up - The spread of interest rates between conforming and jumbo has been greatly reduced. Many programs are still available making it easy for buyers to qualify

Fires in So. California Will Create Construction Jobs and Help Supporting Industries - California has been losing jobs in this area. This in itself will keep a cap on the unemployment rate. Furniture, appliances, landscaping and architects will benefit

Real Estate Investors are Stepping Up and Making Offers - Mostly absent in 2007, Real Estate investors are stepping up to take advantage of the foreclosures and lowered prices

Buyer Sentiment of Those Waiting Will Change as Foreclosure Reporting Lessens - There are so many buyers just waiting for a sign as they fear prices will continue down. The sign will be decreasing foreclosures and inventory time to sell reduced and reported by the media

Information provided by: Kevin Budde, Branch Manager Countrywide Home Loans. Kevin Budde has been in the mortgage industry since 1975 in Orange County.

Economic Week in Review - Oct. 8, 2007

2007-10-08T16:36:00.000-07:00

Employment rebounds
The week's key report was released on Friday, with new Labor Department data on the September employment situation indicating an improved payroll picture, as was expected. Coupled with Thursday's unemployment report, the two releases painted a benign employment situation. In other news, activity in the manufacturing and services sectors slowed, and factory orders declined; consumer credit remained healthy. For the week, the S&P 500 Index rose 2.0% to 1,557 (and has earned a year-to-date total return of 11.4%). The yield of the 10-year U.S. Treasury note rose 7 basis points to 4.64%.

Manufacturing slowed
In September, manufacturing continued to expand—though at a slower rate—as the Institute for Supply Management (ISM) Index of manufacturing activity dropped to 52.0 from 52.9 the previous month. This marked the third consecutive month of declines for the index, which now stands at its lowest level since March. Weak numbers on core capital goods orders and shipments indicated weaker output, as new orders and production grew more slowly. While the report suggested a slowing in manufacturing, the sector is holding up despite ills elsewhere in the economy, especially in housing.

Nonmanufacturing activity eased
The ISM Non-Manufacturing Index also showed a slight decrease for September, dropping to 54.8 from the prior month's 55.8. The report showed that employment activity in the nonmanufacturing sectors increased during the month, as did prices, which saw a big rise. The report came in above consensus expectations and suggested that, overall, the outlook for the services sector remains sunny, though activity may be muted for the rest of the year.

Factory orders fell
In August, factory orders dropped a larger-than-expected 3.3%, wiping out most of July's 3.4% increase. Durable-goods orders sank 4.9%, while nondurable-goods orders posted a 1.6% decline, the largest since January. A decline in oil and coal shipments, driven by August's sharp drop in oil production, accounted for most of the weakness in durable goods.

Payroll picture improved
Two reports from the Labor Department painted an improved employment picture, relieving fears of an economic downturn within the financial markets. Thursday's release showed initial jobless claims for the week ended September 29 increasing to 317,000 from an upwardly revised 301,000 the previous week, bringing claims back in line with expectations. Aside from the occasional spike, during the year jobless claims have remained essentially flat.

Friday's employment situation report showed that employment growth rebounded in September, with a net job gain of 110,000. In addition, August's report of 4,000 jobs lost underwent a major revision, showing an ultimate gain of 89,000. Public-sector employment, which had dragged the preliminary numbers down, actually rose in both August and September. Gains also continued in September for service industries, suggesting that spillover from the housing downturn remains largely contained, and private-sector employment as a whole increased. Overall, the unemployment rate rose very modestly in September to 4.7%, from 4.6% in August.

Consumer credit increased
In August, consumer credit increased $12.2 billion, or an annualized 5.9%, to $2.5 trillion. A report released by the Federal Reserve showed that the latest hike was driven by an upswing in revolving credit, which rose 8.4% in August on the heels of July's 7.7% gain. Rebounding auto sales during August also helped to increase demand for nonrevolving credit, which was up 4.8%.

The economic week ahead
On Tuesday of next week, the Federal Open Market Committee will release the minutes from its September 18 meeting, when it slashed both the federal funds rate and the discount rate. A report on international trade will appear on Thursday, and Friday's releases will cover the Producer Price Index, retail sales, and business inventories.

by: Cheryl Anderson
949-212-2903
http://www.stewartoc.com/

Here's some Total Momsense

2007-09-29T10:27:00.001-07:00

This has absolutley nothing to do with Real Estate but I really enjoyed it and I hope you do to. I remember hearing most of these lines when I was younger.

Could the bottom be near?

2007-09-26T15:46:00.000-07:00

Homeowner's paying $31.8 billion in subprime adjustable-rate mortgages began paying higher interest rates this month. This is the highest amount of subprime ARMs due to reset over a given one month period in this housing cycle. By the end of the year resetting ARMs are forecast to drop to $25.2 billion. By the end of 2008, this number will drop to $3.6 billion.

Interest rate resets have been a big factor in the increased number of defaults this year. As ARM resets reach a peak more homeowners will have trouble meeting payments. Could a record supply of homes for sale, combined with a peak in ARM resets mean the housing market may be near a bottom? Could a market turn up be next?

Economic Week in Review - Sept. 21, 2007

2007-09-22T10:31:00.000-07:00

Investors cheer the Fed's bold move
Investors applauded a major rate-cutting move by the Fed this week, but some of the week's other economic news got a chillier reception. Economic indicators were down a bit, the housing outlook remained gloomy, and there was mixed news on the inflation front. The S&P 500 Index closed the week up 2.8%, at 1,526 (up 9.0% for the year). The yield of the 10-year U.S. Treasury note rose 17 basis points to 4.63%.

Interest rates: The Fed takes action
In a move aimed at easing the credit crunch and shoring up confidence in the nation's near-term economic outlook, the Federal Reserve's Open Market Committee (FOMC) cut both the target federal funds rate and the discount rate by half a percent, to 4.75% and 5.25%, respectively. The committee left the door open to more rate cuts in the months ahead, but acknowledged that it remains concerned about inflation pressures. Stock traders responded enthusiastically to the rate cuts, with both the Dow Jones Industrial Average and the broader S&P 500 Index posting their biggest one-day gains in recent years.

A sharp decline in economic indicators
The Conference Board's index of leading economic indicators fell 0.6% in August, its steepest decline in almost two years. However, a significant upward revision to July's index helped level the longer-term trend. When viewed over an annualized six-month period, the growth rate remained in positive territory, at 1.0%. Analysts said the August slump was due mainly to turbulence in the stock market, declining consumer confidence, and weakness in the construction industry.

Prices dropped in August, but inflation remains a threat
A dip in energy costs helped rein in the growth in prices for consumers and producers during August. The Consumer Price Index (CPI) fell for the first time since last autumn, dropping 0.1%, in line with economists' expectations. Prices for finished goods, as measured by the Producer Price Index (PPI), dropped by a bigger-than-expected 1.4%. When volatile energy and food prices were factored out, however, both gauges were up 0.2% for the month. Over the past year, "core" CPI and PPI were up 2.1% and 2.2%, respectively.

Housing starts hit a 12-year low
There was no letup in bad news for the housing market in August. Residential construction starts fell 2.6%, to 1.33 million units, while permits for new housing—a key measure of expected future demand—fell 5.9%. Both figures represented the worst showing in 12 years for the beleaguered industry. One of the few bright spots was in the market for multifamily housing: Residences with five or more units posted a 16.5% increase in August, while single-family housing starts were down 7.1%.

The economic week ahead
Analysts will have a lot to think about in the final week of the third quarter. On the agenda are reports on gross domestic product (GDP), personal income, sales of new and existing homes, consumer confidence, advance durable-goods orders, and construction spending.

by: Cheryl Anderson
Stewart Title
949-212-2903
http://www.stewartoc.com/

Fed Cuts Rates

2007-09-18T19:06:00.000-07:00

The Fed surprised many economists and traders with a half percent cut in both the Fed Funds Rate and Discount Rate. The Stock Market had its largest gain since 2003.

What does the Fed cut mean? Rates on consumer debt, car loans, and Home Equity lines will all benefit. Because home loan rates are tied more closely to inflation, there may be less of a reaction, or even an opposite reaction in mortgage rates.

The Fed cut also hurts rates of return on investments, which gives foreign investors less incentive to invest in US securities. This has sent the Dollar much lower against the currency of most major foreign countries. This makes foreign goods more expensive for us to buy, which adds to inflation pressures.

Overall, the Fed cut is good news for the economy, but may nudge inflation a bit higher.

Economic Week in Review - September 14, 2007

2007-09-15T11:02:00.000-07:00

Wall Street looks ahead to Fed meeting
Investors sifted through economic data points with a fine-tooth comb this week, seeking indications of whether the Federal Reserve Board will change the federal funds rate when it meets on September 18. In all, the reports were mixed. Retail sales and industrial production increased, but so did business inventories. The U.S. trade gap narrowed, but Americans are now borrowing more heavily with their credit cards. In other economic news, the price for oil moved above $80 per barrel for the first time, and the dollar weakened against other major currencies. For the week, the S&P 500 Index was up 2.1% to 1,484 (for a year-to-date total return of 6.0%). The yield of the 10-year U.S. Treasury note rose 9 basis points to 4.46%.

Credit card usage increased
Consumer credit grew at a slower-than-expected annual rate of 3.7% in July. The credit figure, released by the Federal Reserve Board, comprises two categories: revolving credit (namely, credit cards) and nonrevolving credit (such as auto or student loans). July's consumer credit marked a slowdown in nonrevolving credit, reflecting poor auto sales in June and July. The use of revolving credit increased, suggesting that consumers are borrowing more with their credit cards now that other sources of credit (such as home equity loans) are less readily available.

U.S. trade balance narrowed
The U.S. trade deficit fell 0.3% in July to $59.2 billion—the second decline in as many months. Imports and exports both increased in July, but exports increased at a higher rate, thanks to record levels of U.S. shipments of food, autos, and other categories. The dollar increase in imports was fueled by steeper prices for oil. The average price per barrel of crude oil in July was the highest since August 2006, and the second-highest on record. The $23.8 billion deficit with China—the second-highest on record—accounted for 40% of the total U.S. trade deficit.

Autos pushed retail sales higher
Retail sales in August increased 0.3% from July and 3.7% from August 2006. Excluding the automotive category, which surged 2.8%, retail sales were down 0.4% in August. Gasoline stations, building supply stores, and nonstore retailers (such as online and catalog vendors) posted the steepest sales declines for the month.

Business inventories increased
Total business inventories increased 0.5% in July from the previous month and 3.5% from the year-ago level. Retail inventories rose 1.0%, while wholesale and manufacturer inventories each increased 0.2%. Overall business sales increased 1.1% in July, driven by strong sales (2.6%) at the manufacturing level.

Electric utilities drove production higher
A jump in production at electric utility plants pushed overall industrial production higher in August. Industrial output increased a lower-than-expected 0.2% for the month as activity in the manufacturing and mining sectors each declined less than 1%. But a 5.3% increase in utilities (6.3% at electric utilities) kept production in positive territory.

The economic week ahead
Market observers will pay close attention to Tuesday's meeting of the Federal Reserve Board's Open Market Committee (FOMC), when Chairman Ben Bernanke and his colleagues will determine whether to raise, lower, or hold steady the federal funds rate. Following a turbulent period in the markets, falling employment, and ongoing concern about the housing sector, some Fed-watchers expect the FOMC to make the first rate cut in more than a year. In addition, two reports on inflation will be issued: the producer price index on Tuesday, and the consumer price index on Wednesday. Other scheduled releases include new residential construction (Wednesday) and an index of leading economic indicators (Thursday).

by: Cheryl Anderson
949-212-2903
http://www.stewartoc.com/

The Best Buyers Market

2007-09-12T20:00:00.000-07:00

The September 2007 Statistics are now in. We currently have one of the Best Buyer's Markets imaginable. In the past prices were high, inventory was low and buyers were bidding against each other while driving up the prices on the few available homes. Now prices are low, mortgage rates are low, inventory is high, yet the Buyers are hesitant to buy, even though EVERYTHING IS ON SALE NOW! There are some fantastic deals and some very motivated sellers.

"The South Orange County residential Real Estate market has really slowed down to an unfortunately record breaking low level… Data Quick reported a few weeks ago that July was the lowest sales volume in Orange County the past 20 years … and the past week was the lowest sales volume we have tracked in south Orange County since July of 2002’… Fortunately, the number of homes Active for sale has leveled off and has not been increasing… We now stand at 15 Months of Inventory for all price ranges… I don’t think these low sales volume numbers can last much longer.. "
Quote and chart courtesy of Vince Bindi, Keller Williams Realty

The Gratitude Dance

2007-09-12T19:00:00.001-07:00

It might be fun to take some time for gratitude.

2007-09-08T13:09:00.000-07:00

Economic Week in Review
September 7, 2007
by Cheryl Anderson, Stewart Title

Jobs take a tumble
The continuing slump in the housing market appears to be affecting the broader economy, as a closely watched employment report showed that U.S. payrolls fell for the first time in four years. The weaker-than-expected jobs report was widely seen as putting more pressure on the Federal Reserve to reduce interest rates. Not all of the week's economic news was downbeat, however, as worker productivity increased at a faster-than-expected pace. For the week, the S&P 500 Index was to 1,454 (for a year-to-date total return of 3.79%). The yield of the 10-year U.S. Treasury note fell 17 basis points to 4.37%.

Payrolls slid unexpectedly
Nonfarm payrolls declined by 4,000 in August, the Labor Department reported Friday. Economists had been expecting an increase of 120,000. Reflecting weakness in the housing market, construction was among the sectors that suffered the heaviest job losses, with residential specialty trade contractors particularly hard hit. The anemic employment report, which included sharp downward revisions for the June and July payrolls as well, "will weigh more prominently than normal in the Federal Reserve's deliberations on monetary policy" when they next meet on September 18, remarked Vanguard economist Joseph H. Davis. The unemployment rate, which is based on a different survey than the one used for payrolls, remained unchanged at 4.6%.

Productivity, labor costs were better than expected
U.S. productivity grew by an annualized 2.6% in the second quarter, an upward revision from the Labor Department's preliminary estimate of 1.8%. The latest productivity figure exceeded economists' expectations and appeared to be a reassuring sign to inflation-watchers, as rising productivity can help restrain inflation. Also encouraging from an inflation standpoint, unit labor costs grew at an annualized 1.4% in the second quarter, slightly less than economists had expected and a significant downward revision from a preliminary estimate of 2.1%.
Beige Book survey reported tighter credit hurting housing sector
The Federal Reserve's anecdotal survey of regional economies, known as the "Beige Book," found that tighter residential mortgage lending standards are exacerbating problems in the housing sector. Banks reported to the Fed that the reduction in the availability of mortgages created "uncertainty about when the housing market might turn around." On the positive side, the report noted "modest to moderate" increases in retail sales and found that some regions were experiencing "particularly solid growth in tourist spending." The report suggested that inflation, on the whole, is under control, with most regions reporting "little change in overall price pressures."

Manufacturing growth slowed, service sector remained stable
Growth in the manufacturing sector declined in August. The Institute for Supply Management (ISM) Index of manufacturing decreased to 52.9 from July's 53.8, the second consecutive drop for the index. However, the index reading did remain above 50, suggesting that the manufacturing sector is still expanding, albeit at a slower pace. The ISM Non-Manufacturing Index, a gauge of economic activity in the service sector, remained at 55.8, unchanged from July. The August reading was slightly ahead of expectations, and the new-orders component of the index climbed 4.2 points.

Construction spending slipped
Construction spending in July fell 0.4%, much weaker than the 0.1% increase that economists had expected. Private construction spending slid 0.7%, hurt by a falloff in residential construction that reflected continued weakness in the housing market and that more than offset gains in nonresidential spending.

The economic week ahead
The coming week's economic reports should offer insight into varied aspects of the economy. Reports on the U.S. trade balance (Tuesday), consumer credit (Monday), retail sales (Friday), business inventories (Friday), and industrial production (Friday) are scheduled to be released.

Have a wonderful and successful week!

Cheryl Anderson
949-212-2903
http://www.stewartoc.com/

Short Sales

2007-09-07T08:51:00.000-07:00

I've been seeking a reasonable solution for local homeowners that for various reasons need to sell now even though the proceeds from that sale is less than the total encumbrance on their property, resulting it what is commonly called a Short Sale. Traditionally the property is marketed, the Seller accepts an offer pending the approval of the lien holders. The approval process can take a great deal of time, the lenders can be difficult to contact and even more difficult to negotiate with.

This week I forged an alliance with an organization that specializes in the transaction side of the Short Sale. They offer expertise in the process, leverage their relationship with the lenders and ultimately get the Short Sale to successfully close in a reasonable time frame.

In the past I have shied away from representing Short Sale listings because of the uncertainties involved in succesfully closing the transaction. With this system in place I am now confident that I can provide a valuable service to Sellers who find themselves in a Short Sale situation.

I can be reached at 949-362-5052 or len@len4homes.com

2007-08-17T16:29:00.000-07:00

Economic Week in Review
Economic Week in Review by: Cheryl Anderson, Stewart Title
August 17, 2007

Stocks slump, Fed cuts discount rate on Friday
In a surprise move, the Federal Reserve cut its discount rate on loans to banks Friday morning, in an effort to calm the financial markets. Through the week, stocks had continued to slump because of turmoil in the subprime mortgage market, erasing most of 2007's gains. It was a busy week for economic reports. On the plus side, the U.S. trade deficit declined in June, while the July Consumer Price Index indicated that inflation pressures were easing. In other reports, retail sales and industrial production increased; business inventories and producer prices also rose. New residential construction declined. For the week, the S&P 500 Index fell 0.5% to 1,446. The yield of the 10-year U.S. Treasury note fell 11 basis points to 4.67%.

Retail sales increased
The retail sales report for July showed a modest increase, up 0.3%. Core sales (which exclude autos) were solid, lead by sales at department and apparel stores as well as restaurants. Building-supply stores also posted a small gain. Declining gasoline prices hurt gas-station sales, and automobile and parts sales were down 0.3%. Consumer spending appears to be holding firm despite recent turmoil in the financial markets.

Business inventories rose
In line with expectations, total business inventories increased by 0.4% in June. Wholesale and manufacturer inventories increased 0.5% and 0.3%, respectively. Retail inventories were up 0.5% for the month, 0.2% excluding automobiles. Auto inventories rose by 1.0%. The inventory-to-sales ratio rose slightly to 1.27, up from May's 1.26, due largely to weakness in auto sales.

Producer prices moved higher
July saw substantial rates of inflation at every stage of processing. Producer prices for finished goods rose 0.6%, more than expected, due largely to increases among energy products, as energy costs rose 2.5%. Core prices remained relatively stable, however; excluding food and energy, prices for finished goods rose only 0.1%.

U.S. trade deficit narrowed
The U.S. trade deficit narrowed by 1.7% in June to $58.1 billion, a $1.0 billion change from May's revised figure of $59.2 billion. Though both exports and imports were up, exports increased more than imports, aided by a weaker U.S. dollar. The goods deficit with China grew to $21.2 billion, and the China deficit now accounts for 36% of the total U.S. trade imbalance. Compared with one year ago, exports rose in June by 11%, while imports increased 4%.

CPI showed inflation easing
The Consumer Price Index (CPI) for July provided evidence that inflationary pressures were easing. Following a 0.2% increase in June, the CPI was up 0.1% in July, due largely to falling energy prices. The core index, which excludes food and energy, increased 0.2% in July, following an identical increase in June. Core inflation has trended around 2.2% over the past 12 months.

Industrial production increased
In July, industrial production rose 0.3%, slowing the momentum of its 0.6% June increase. Mining output rose 0.7% and manufacturing output increased 0.6%, while utility production showed a larger-than-expected drop of 2.1%. Manufacturing output has increased an annualized 4.9% over the last three months. Automobile production was strong, up 2.6%, though sales were weak.

New residential construction declined
The July report on new residential construction suggested that the housing market has yet to reach bottom. New residential starts decreased 6.1% to 1.38 million units, with declines seen in every region. Total permits also decreased. A National Association of Home Builders Housing Market Index suggested that builder optimism is at a 20-year low.

Fed cut discount rate Friday morning
In a surprise move, the Federal Reserve cut its discount rate by a half-percentage point, in an effort to bring some order to the turbulent financial markets. Citing tighter credit and deteriorating market conditions, the Fed lowered the discount rate, which is the interest rate it charges to make direct loans to banks, from 6.25% to 5.75%. However, the Fed did not change the federal funds rate, which remained at 5.25%. The move should thus have little effect on consumer interest rates.

The economic week ahead
Next week will be a light one for economic reports. On Monday, The Conference Board will release its index of leading economic indicators. Data on durable-goods orders and new-home sales will be available on Friday.

Cheryl Anderson
949-212-2903
http://www.stewartoc.com/