Real Estate Update by Kia
Placer, Sacramento, El Dorado Counties
October 2008 - Vol 3, Issue 10
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2008 Halloween

HALLOWEEN 2008...
funny picture, scary reality!!!

The 4th quarter of 2008 seems to have everyone concerned about their personal finances whether it it's income, real estate or the stock market. In this time of uncertainty the best advice I continue to hear is pay off as much debt as possible.

We're still in the middle of this economic hardship so it's hard to see the silver lining. In the end I believe this will be a realigning of values and responsibility. We're getting back to the old fashioned way of buying something we can afford - saving money for a down payment on a home and paying for an evening out with cash instead of credit cards.

I hear many terrible stories of how people are personally affected and they too will turn around and strongly land on two feet. This is the 7th recession since the great depression and the economy has rebounded after each one.

There are still many people out there taking advantage of the great buys in real estate. Banks continue to drop prices to dump their real estate inventories in all price ranges. Inventories for bank owned are running between 2-3 months, which is considered a seller's market. Approximately 60% of all-price-range sales are bank owned (REO).

85% of under-$200,000 home sales are bank owned. For first time home buyers, investors, someone wanted to downsize into a more affordable mortgage and those waiting for the bottom of the market - NOW is the time to jump into this price range. Our inventories are greatly reduced and it's a competitive market so act quick if you're in a position to take advantage of this REO dominated market and start planting your two feet strongly on the ground!!!

Call Kia to have listings emailed directly to you when they come on the market.

Happy Halloween,
Kia Kapci

ESTRELLA
Now's the time to take advantage of this market and move into one of the lowest priced homes in the prestigious Catta Verdera Country Club community! Open single story floor plan. Main entry opens to the living/dining rooms with huge windows overlooking the .45 acre lot complete with salt water pool, fountains, built-in BBQ & firepit. 4 car garage, smart vent, whole house fan, central vac. Enjoy your coffee in the front courtyard by morning and great views of the valley and sunset by evening.
Bridge Creek Pool
Now listed at $999,000
Incredible hilltop custom estate w/ tree lined winding driveway!2.3 acres w/ mature landscaping & beautiful views.Backyard landscaping, fence, pool, spa, waterfalls, outdoor ktchn, bocce ball & fire pit finished 08!!! Boat/RV access.Mstr suite dwnstrs. Gourmet ktchn w/ granite, Viking Prof gas range & built-in fridge and island w/ sink.Frml living/dining rms overlook front courtyard & vineyard.Upstairs balcony loft complete w/ granite slab wet bar (finished 08) for your game rm or home office.
Stone Temple Golf Course Shot
PRICE JUST REDUCED T0 $969,000!!!!!!!
Custom luxury home on the golf course!!! Floor to ceiling windows overlooking the 4th fairway and green of Whitney Oaks golf course. Spacious gourmet kitchen with Savage cabniets is entertainers dream. Lg great rm, formal dining rm & full bar complete w/flat screen opt, and wine storage will impress guests! Lg guest quarters w/mini ktchn, fireplace & full bath w/outdoor patio. Well thought out floor plan to accommodate all needs of entertainers, golfers, kids. Pristine condition!
News Analysis: Long-term value, not short-term appreciation
The real estate industry must rethink the market fundamentals, the long-held demographic and economic beliefs that experts argued would drive the housing demand into the future.

The world has turned upside down with old truisms now seeming trite.

In January 2003, Inman News convened a conference on the "Housing Bubble," during which some experts promised the boom would continue because of six "market fundamentals." These were the mantra for the industry for more than 10 years:

  • · Low mortgage rates. Cheap credit would keep home loans affordable.
  • · Boomer wealth. Prosperity and the rolling over of assets from the Depression generation to the spending generation would continue to ignite home purchases.
  • · Consumer confidence. At the 2003 conference, Yale professor Robert Shiller of the Case- Shiller home-price index argued that historic bubbles did not burst until consumers gave up on the asset that prompted their confidence. At the time, real estate enthusiasm was as strong as the morning Starbucks coffee habit.
  • · Low unemployment. The argument was that people who are employed buy houses.
  • · Unlimited market liquidity. Access to capital seemed unrestrained as Fannie, Freddie and the mortgage-backed securities market was flush with funds.
Most industry experts proffered that the boom could continue unabated.

The housing market held up for two more years after the 2003 conference as an unaccounted factor -- subprime mortgages -- further whipped up an already questionable housing market and covered up cracks in the fundamentals, such as out-of-control home prices.

As the bubble began to burst in 2006 and 2007, real estate experts were bolstered by their "market fundamentals" arguments. But those promises now appear empty.

The demographic wind is gone, as immigrants are less drawn to the United States because of our economic demise and our overbearing border constraints.

Mortgage rates are low, but artificially cheap home loans are gone and super tight credit makes it difficult for even the most worthy borrowers to take advantage of low rates. And the secondary market has been downsized beyond anyone's imagination.

Boomer wealth is shrinking every day as home and stock equity evaporates. The tables have turned on the lucky generation. Plus, record levels of debt reduce the net worth of the average boomer's personal balance sheet.

Consumer real estate confidence is waning as homeowners witness record losses in their home equity.

Demand for housing now depends on more basic considerations -- a new, but actually an old, set of fundamentals.

Homeownership offers more control and freedom compared to renting. The government subsidizes homeowners, not tenants. And over the long term, owning a home is a disciplined way to build savings as owners pay off their loans and keep their housing costs predictable, assuming they get fixed-rate mortgages.

And finally, homeownership becomes reasonably affordable because wild swings in value even out as liquidity excess is not pushing too many buyers into the market.

In this environment advantages still favor owning over renting, but the new fundamentals translate into a housing market that is significantly smaller.

It is a future based on long-term value, not short-term appreciation, with significantly fewer home sales but a more stable market.
Article by: Inman News Oct 7, 08

FOR A FREE MARKET ANALYSIS OF YOUR HOME AND ESTIMATE OF VALUE CALL OR EMAIL ME! I WILL GET YOU THE INFO WITHIN 24 HOURS OF YOUR REQUEST. Please contact me with all of your real estate needs and questions. I am always available to you, your family and friends!

Happy Halloween,
Kia Kapci
Lyon Real Estate

phone: 916-782-0558
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