All posts by jd

Real estate broker, civil engineer and general contractor.

Canadians Largest Foreign Real Estate Investors in U.S.

June 30, 2009 jd

The Canadian’s have increased their investment in the United States from 11 percent in 2007 to 23.5 percent in 2008, making Canada the largest foreign real estate investor in the U.S. according to the National Association of Realtors®

The strong attraction for the Canadians is that the Canadian “loonie” is at par with the U.S. dollar for the first time since 1976, making this the best exchange rate in more than thirty years. So with property values having fallen so plummeted in the U.S. it is a perfect time to buy.

According to the The Sierra Vista Herald

“The double whammy of falling U.S. real estate prices and a rising Canadian loonie has created a once-in-a-lifetime bargain for Canadians looking for property in the U.S. Sunbelt,” said Bank of Montreal Chief Economist Sherry Cooper. “I love the Canadian dollar at parity. We are truly richer, as the money we earn and the money we invest is worth more.”

“When (the Canadian dollar) hit a dollar ten, it really created a real buzz for Canadians, not only those looking to buy second homes, but we’re also seeing it from buying purely from an investment standpoint,” he said.

The National Association of Realtors reports that 64.4 percent of Canadian buyers plan to use their U.S. homes for vacation purposes.

On average, foreign purchasers plan to stay in their U.S. property 2.6 months of the year. A third intends to use their U.S. home a total of three to six months.

LaVoie, sums it up, “Foreign investment has an undeniable presence in the U.S. real estate market, especially here in Arizona. Opportunities are abundant. Now is the time to buy and our Canadian friends clearly recognize this. For them, this is the most opportune time to invest.”

I think if you have the money, it’s a buying opportunity of a lifetime. Do you think it’s a good time to buy real estate?

Craigslist Rental Scam II

June 29, 2009 jd 6 Comments

Home may be a man’s castle, but in Paul Salamone’s case, the entire fiefdom was allegedly fraudulent.

The Medford man is facing a Suffolk County, Long Island, jury this week after being accused of breaking into seven homes in various states of foreclosure and illegally renting some of them out in a scheme to capitalize on the failing local housing market. In his defense, his attorney points out that 28-year-old Salamone, who prosecutors say had renovated some of the vacant houses before he advertised them as for rent on Craigslist, truly believes what he was doing was right. Despite Salamone’s supposed good intentions, at least two families that rented from him were caught in the crossfire and evicted after the alleged scam began to unravel.

Accused felon Paul Salamone is charged with renting foreclosed homes he didn’t own.

“Confusion and misunderstanding, not guns or knives, were Mr. Salamone’s weapons,” said Marc Lindemann, the assistant district attorney who is prosecuting the case, in his opening statements at Suffolk County court in Riverhead on June 22.

Salamone allegedly told realtors that they no longer had ownership of the houses and backed his argument with what Lindemann described as official-looking documents. But many of the houses were actually owned by Deutsche Bank, said Lindemann, a prosecutor with the Suffolk District Attorney’s Office’s Economic Crimes Bureau.

It took police several months to connect the dots. A grand jury had indicted Salamone on five counts of burglary, but two more counts were added when additional houses were discovered. He was also charged with grand larceny for the “rent” he received, and criminal possession of a forged instrument for filing more than a dozen fraudulent liens.
Salamone’s attorney, Eric Naiburg, admits that his client made a serious mistake, but insists he is not a crook.

“He had no right to be in these houses,” the Smithtown-based attorney said in his opening statement. “That is conceded. That he went into these houses with the intent to commit a crime, that is not conceded, not conceded at all.”

“If this was a scheme, it was dumb,” Naiburg said, adding that if Salamone was trying to scam people, as prosecutors allege, then “he is the worst scam artist this nation has ever seen.”

Source: The Long Island Press

What do you think of the defense attorneys statement? Salamone rented the homes out that wasn’t his, but Salamone did not intend to commit a crime? Huh?

Real Estate

Senior Citizens Kidnap, Torture Their Financial Advisor

June 28, 2009 jd 1 Comment

So we have financial advisors who steal money in this country and wait for the wheels of justice to turn to punish them. But some senior citizens in Germany had what they thought was a better approach to punish and get their money back at the same time.

The good senior citizens ambushed James Amburn, 56 outside his home in Speyer, Western Germany, bound him with duct tape and bundled him into a car trunk.

Amburn was than driven 300 miles to the Bavarian lakeside home of one of the gang. As the financial advisor Amburn, who runs investment firm Digitalglobalnet, was taken to the cellar another couple, retired doctors, joined the kidnappers in the cellar where Mr. Amburn was chained and tortured for four days last week.

The reason for all of the anger from the good citizens was that the financial advisor has lost the equivalent of $3.3 million of their money. It seems that their money was supposed to have been invested in Florida real estate, which of course was lost completely.

Mr Amburn said: ‘I had known these people for 25 years. I had no reason to be afraid. But as I went into my home I was jumped from the rear and struck.

‘They bound me with masking tape until I looked like a mummy. It took them quite a while because they ran out of breath. When they loaded me into the car I thought I was a dead man.

‘I was bleeding from my eyes, nose and my mouth. But the nightmare had only just started.’

During his confinement in an unheated cellar, Mr Amburn claims he was burned with cigarettes, beaten, had two of his ribs broken when he was hit with a chair leg and chained up ‘like an animal.’

He says he was fed only two bowls of watery soup during his four days in the dungeon.
He was rescued when he convinced his captors that he had money in a Switzerland bank that could be transferred to them if they allowed him to fax a note to the bank. They agreed to let him send the fax, but unknown to the seniors he scribbled a note at the bottom of the fax to call the police.

Shortly afterwards, the Swiss bank telephoned police in Germany and an armed team of special SEK commandos was scrambled and the house was stormed in the early hours of Saturday morning.

An ambulance with a doctor had to be called not only for Mr. Amburn, but also for the senior citizens because of their infirmities. How about that!

Chief public prosecutor Volker Ziegler said: ‘They were angry because they invested money in properties in Florida and he lost it all.

‘This was black money – they hadn’t declared it to the revenue authorities in Germany.’

Mr. Amburn is recovering from cigarette burns, broken ribs, threats of being killed by the Mafia. The seniors are facing 15 years in jail for kidnapping, torture and tax evasion.

Finally what do you think of this vigilantism? Do you condone their actions?

Angel's Dog House Listings

Angels Dog House Listings – The Pug & the Peacock

June 27, 2009 jd

The pug and the peacock, is this a battle to a draw? You decide. Make a comment and let me know if you like this breed or have one.

Anyhow, Angel has no new dog listing this week. Lots of potential clients saying they’re going to send in pictures of their dogs with a little story, so hopefully they will do that soon.

So to fill in the rest of the week, we found one of her relatives starring in this video of the pug versus the peacock.

httpv://www.youtube.com/watch?v=BhVwhJmFmfQ

(If you can’t see this video, you need to download flash player to see it)

According to Pug-Wikipedia

“The expression of the Pug belies its true sense of fun. Pugs are sociable dogs, and usually stubborn about certain things, but they are playful, charming, clever and are known to succeed in dog obedience skills.

Bred to adorn the laps of the Chinese sovereigns during the Shang dynasty (before 400 BC), in East China, they were known as “Lo-Chiang-Sze” or “Foo” (ceramic foos, transmogrified into dragon, with their bulging eyes are very Pug-like). The Pug’s popularity spread to Tibet, where they were mainly kept by monks, and then went onto Japan, and finally Europe.

This breed may also be referred to as a “Lion Dog” or “Foo (or Fu) Dog” due to its resemblance to Chinese guardian lions just like the Pekingese dog breed from China of similar origin and resemblance to Chinese guardian lions which are considered a guardian spirit.”

What do you think?

Real Estate

Hard Money Lender Tom Hastert Demands Jury Trial

June 26, 2009 jd

It’s hard for me to imagine a man like Thomas Hastert a man who worked so hard to get ahead in this world becoming a felon. Hastert worked for the Nevada County Sheriff’s office, studied to become an attorney, then got his real estate broker’s license.

Once he got his broker’s license he proceed to engage in hard money lending in direct conflict with the law, making construction loans without fully funding them, a felony.

In addition, Hastert pleaded no contest to 62 counts of embezzlement, offering and selling unregistered and unqualified securities by false and incomplete communications. According to the Attorney General of California amounting to $20 million lost by his clients. That’s a lot of money to handle and lose. A standard fee for the mortgage broker Hastert is to charge is about 3 percent of the loan amount which means Hastert would have pocketed about $600,000.

Hastert’s attorneys and the California Deputy Attorney General Keith Lyon had reached a plea bargain that would have given Hastert five years in state prison. Normally that type of sentence means two and one-half years and he’s out of prison.

However, at the sentencing Judge Sean Dowling rejected the plea agreement and came back with his own sentencing of eight years and four months. Hastert’s attorney refused the new sentencing and demanded a jury trial.

I met Thomas Hastert some time ago, while he was an attorney. I did some investigations (as a civil engineer) for Hastert regarding building code violations for some of the real estate cases that he had. My impression of him at that time was that he was a nice person and I had no idea that he would resort to what he did. What does a person like that think? We have the Bernard Madoff, the Sir Walter Stanford’s who look you in the eye with a smile and steal your pocket book at the same time.

What do you think?

Business, Education

California State Board of Education Cooks Their Books

June 25, 2009 jd 3 Comments

state-board-of-educa-book1
It seems that the California Department of Education has taken a leaf from Wall Street and AIG. Let’s keep the bad CEO’s which in this case are superintendents and their staff, layoff school teachers, and then cook the books on the rate of dropouts in the State’s high schools.

By using Wall Street techniques and new math, they claimed that the overall dropout rate for California dropped from 21.1 percent to 20.1 percent in 2008. But they noted only 68.3 percent graduated! The best guess is that the other 11 percent of students went into an equivalent of an offshore account where they were given a triple A rating.

Calling this unsecured account a derivative, they may somehow have become an asset instead of a liability.

It is my understanding that this account will be sold for additional funding for employing more staff for the management team and the administration.

In further accounting maneuvers, just a few months ago, they raised the high school dropout rate from 12 to 24 percent. Wall Street would indeed be proud of this administration.

By the way, according to the 2007-08 report from the National Education Association we spend more than $300,000 annually for each classroom of 25 students. My daughter is a school teacher and she has to buy paper and pencils for her students.

You know why? 75% of that money goes to salaries, benefits, administration and other overhead costs. That’s $9,000 per student or $225,000 per classroom per year for overhead. Now you know why they can’t provide pencils and paper.

Quoting the Visalia Times-Delta

““While enrollment has dropped by 70,000 in the last four years, the Department of Education (actually the districts themselves do the hiring) used its increasing funds to hire just 3,800 additional teachers while adding 15,600 more nonclassroom employees between 2004 and 2007. Our schools must have a reliable stream of funding, but it should be based on actual enrollment needs.”

Did you get that, they hired 76% more overhead then they did teachers. Yet, every time they cut the state budget for schools they lay off—teachers.

If you think this needs to be fixed, let your favorite politician know what’s going on.

Real Estate

Vultures are Coming to the Real Estate Market

June 24, 2009 jd 2 Comments

vultures

I have said many times on this site, now is the time to buy real estate if you have the money and can wait for the market to change. Now REITs (real estate investment trusts) with stronger balance sheets are building billion-dollar war chests to fund acquisitions of troubled properties on the cheap. They’re raising the money to fund acquisitions of distressed commercial properties.

REITs are more then ready, having raised over $12 billion by issuing stock in recent months. There’s an estimated $90 billion in the U.S. that is “distressed” according to New York based real estate research firm Real Capital Analytics.

These are properties that have been foreclosed on, or whose owners are in default on their loans or in bankruptcy. “On top of those properties, there is hundreds of billions more in debt coming due in the next few years,” says Peter Slatin, editorial director at Real Capital. “Some REITs are getting prepared for that.”
The four blue-chip REITs cited above represent a fairly conservative way for individual investors to profit from the (hoped-for) real estate rebound. The fact that they have the resources to exploit today’s weak market may set them up for years of healthy cash flows. “These are the commercial real estate companies that are going to survive,” says Jim Sullivan, senior REIT analyst with Green Street Advisors. “They all have balance sheets that are stronger than average and management teams that have proven their ability to take advantage of downturns.”

Anyone who goes bargain hunting in real estate today has to be patient. REITs fell earlier and harder than the broader real estate market. In the two years from March 2007 to March 2009, REIT stocks fell a stunning 75% on average. Lately, however, REITs have been on a roll, with the MSCI U.S. REIT index gaining more than 45% since the March low. Does this spurt mean that REITs are foreshadowing a sharp rise in real estate values? Some experts caution that there is more pain to come. “Prices have gotten ahead of the fundamentals in real estate,” says Kenneth Rosen, chairman of the Fisher Center for Real Estate and a professor emeritus at the University of California at Berkeley. “It has gone too far, too fast.” Rosen expects a correction in the coming months.

But many analysts like the longer-term outlook. “The underpinnings of the commercial real estate market are really in pretty good shape,” says Philip Martin, a senior vice president of Golub & Co., a Chicago-based real estate investment and development firm. He notes that there isn’t the kind of massive oversupply of commercial properties that existed during the slump of the late 1980s and early 1990s. “So when we do recover, you are likely to see a pretty healthy snap-back in real estate prices,” he says. “This is an excellent environment for those REITs with the right combination of knowledge and capital. They are going to have an opportunity to make some great deals, and the risk-adjusted returns at this point in the real estate cycle are going to be pretty darn good.”

Source: CNN Fortune

Real Estate

Federal Home Buyer Tax Credit Update

June 23, 2009 jd

tax-credit-update
Lawmakers and businesses are calling for an expansion of the existing tax credit now capped at $8,000 to be raised to $15,000. The existing federal tax credit of $8,000 has been a success in spurring first-time home buyers to get back into the housing market.

A further proposed change would be that the tax credit would be applied to anyone who buys a home.

First-time buyers make up a hefty 40% of home purchases, according to the National Association of Realtors (NAR), which is about 5 percentage points higher than the historical average.

Some economists say a tax benefit is vital to spur home buying and help stabilize prices.

According to USA Today the current proposals are:

“•A Senate bill to expand the tax credit to $15,000 for any home buyer regardless of income was introduced this month by Sen. Johnny Isakson, R-Ga. It is co-sponsored by Senate Banking Committee Chairman Chris Dodd, D-Conn.

“It would go a long way toward inducing trade-up buyers into the market,” says Lawrence Yun, chief economist at the NAR.

•A House bill to keep the $8,000 credit in place until June 2010 and expand it to all home buyers was introduced last month by Rep. Kenny Marchant, R-Texas. It also would provide a $3,000 credit to homeowners who refinance.

•Another bill in the House, introduced by Rep. Eddie Bernice Johnson, D-Texas, would extend the credit to all home buyers through 2010.”

The present tax credit does not apply to singles earning more than $95,000 a year and couples who earn more than $170,000.

Buyers do not have to repay the tax credit if they occupy the home for three years or more.

nevada county fair

Nevada County Fair Partners with Summer Youth Employment Program

June 22, 2009 jd

The Nevada County Fairgrounds has partnered with One-Stop Business and Career Center’s Summer Youth Program to provide jobs and training to Nevada County youth.

The program provides young adults with employment skills in a planned, structured learning environment. It is designed to provide specific behavioral skills appropriate for the workplace, as well as to promote the development of good work habits and basic work skills. Each applicant must go through a job interview process before being placed in the program.

At the Fairgrounds, the young adults have been busy doing winter clean-up of the Fairgrounds, building benches, preparing various areas for this year’s Fair, installing bicycle stalls, landscaping, and painting. Their current project involves designing and landscaping a garden memorial, from its inception to its completion, near Gate 4.

“I believe in empowering our youth,” said Clif Mackinley, work program supervisor at the Fairgrounds, “and this program does just that. It empowers them, teaches them life and employment skills, and teaches them about taking responsibility on the job.”

The program, which is funded through federal dollars received from the Private Industry Council, provides participants the opportunity to work 40 hours per week at the Fairgrounds until the end of September.

“The work these young adults do is so beneficial to our Fairgrounds and our community,” said Robin Hauck, Deputy Manager at the Fairgrounds. “They are hard workers, with a strong work ethic, and their work is already evident to Fairgrounds’ visitors. It is a delight to have them working at the Fairgrounds.”

Contact: Robin Hauck, Deputy Manager
(530) 273-6217; robin@nevadacountyfair.com

For more information about the Nevada County Fair, August 12 – 16, call 273-6217 or visit www.nevadacountyfair.com. For information about the One-Stop Business and Career Center, call (530) 265-7088.

By Wendy Oaks

Real Estate

Ex NFL Quarterback Bernie Kosar Files Bancruptcy, Ex-wife Sells House

June 21, 2009 jd

Former gridiron great Bernie Kosar, dogged by financial and legal problems, filed for bankruptcy Friday. In the meantime his former wife Babette sold their home for a cool $2,400,000 according to Zillow.com. Kosar’s wife, Babette, divorced him in 2007. Last year, his Bernie Kosar’s Steakhouse went out of business.

Kosar, 45, the former Miami Hurricane and NFL quarterback, filed for Chapter 11, which is generally used by companies to reorganize.

The bankruptcy petition didn’t provide much detail. Boxes were checked off on the petition indicating Kosar has assets estimated between $1 million and $10 million and liabilities of between $10 million and $50 million.

The filing listed Kosar’s largest unsecured creditors, owed a combined $19.5 million. Among them and the amount of their claims: the Cleveland Browns, a team he quarterbacked from 1985 to 1993, nearly $1.5 million; his ex-wife Babette, $3 million; and Jim Ferraro, the owner of the Cleveland Gladiators, an Arena Football League team, $725,000. Kosar is the team’s president.

Other major unsecured creditors include Tampa’s Florida Bank, owed about $9.7 million over some sour real estate investments and Key Bank of Cleveland is owed about $3.1 million.

The filing marks a hard fall for Kosar, the star Hurricanes quarterback in the 1980s who went on to excel in the NFL with the Cleveland Browns before ending his career with the Miami Dolphins in 1996.

Lenders also obtained foreclosure judgments on apartment properties Kosar had an interest in in Tampa, Clearwater and Pinellas Park.

A recent story by Yahoo points out that Kosar needs to mount a comeback. Read Yahoo’s Story about Kosar.