Real Estate

The Most Expensive Residential Listing in America

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mansion
According to several news sources, the most expensive residential listing in California and the United States is the home of Candy Spelling, widow of legendary TV producer Aaron Spelling. It’s the largest house in Los Angeles County. A few statistics:   

            Size 56,500 square feet, slightly bigger than the White House

            Three Stories

            Called the Holmby Hills Estate, also known as “The Manor”

            Style: Looks like a French chateau

The home has a kitchen in which you can cook for 800, an automated projection room, a bowling alley, a flower cutting room, a wine cellar/tasting room, a silver storage room with humidity control. There’s also a service wing to house the bedrooms of five maids two butlers’ suites, one which has a kitchenette. The house is believed to have more than 100 rooms. Spelling said she isn’t sure, she never counted them.

On the outside, there is a parking lot, dubbed the “motor court, which can accommodate 100 vehicles, with 16 carports to boot. There’s a swimming pool with a pool house, tennis court, a koi pond, gardens, and a citrus orchard.

It’s all become a little too much for Spelling, 63, who is downsizing to a 16,500-square-foot condo in Century City.“All the stars came through,” Spelling said of her 18 years in residence. “Prince Rainier, Prince Charles, Jackie Kennedy — every star from every one of Aaron’s shows.

Fred Sands, who once owned one of the nation’s largest real estate brokerages and is now a commercial real estate investor, said prices for houses like the Spelling property tend to be set largely at the seller’s whim — and the listing price could be far from the eventual sale price. “A broker is capable of saying, ‘It’s listed at 150, but make me an offer,’ ” Sands said, “They’d have a better chance at $60 million, $70 million, but it’s an iconic property — who’s to say?”

Yes, it would be hard to make a comparable sales price on this home, since there is nothing like it on the market.  I wonder if guests are given GPS devices when they vist so they won’t get lost?

Real Estate

Bay Area Medium Home Prices Plunge

newprice

According to an article in the San Francisco Chronicle today, home prices in the Bay Area have dropped dramatically since its peak in spring 2007.

Spring 2007, median Bay Area home sale price $720,000

February 2009, median Bay area home sale price $295,000

The large drop in home prices is the result of more than half the homes sold in January and February were foreclosures, compared to two years ago when only about 2.6 percent were foreclosures. This drop in home prices has created a surge of buyers. Among those buying, first time home buyers with an incentive of an $8,000 Federal tax credit to savvy investors who are buying to rent and waiting for the appreciation of home prices which will surely come.

According to the SF Chronicle:

“A Chronicle analysis of sales data from MDA DataQuick, a San Diego real estate research firm, indicates that the majority of local buyers are either first-time homeowners or investors taking advantage of the huge glut of fire-sale-priced distressed properties – bank-owned foreclosures, short sales and homes surrounded by foreclosures and short sales.

“At least two-thirds of the market is split between investors and first-time buyers,” said LePage. “The balance is mainly the people who have to buy because of a new job or other life events.”

Many homes here have returned to the realm of reasonable prices, with the median sale price hovering below $300,000. That means that even people with incomes around the Bay Area’s median of $80,000 or so can find properties within their price range. ”

An increasingly larger share of the buyers are investors. They’ve either made the calculation that, for the first time in years, they can make money by renting out the properties, or they think they can re-sell them at a profit. “

I agree with the investors, real estate prices will come back. In 1982 when the Savings and Loans crashed, people were saying, real estate prices will never come back. I say, history repeats itself.

Real Estate

California Bill Passed to Delay Foreclosures

stop-foreclosure

In order to delay foreclosures and give homeowners more time to deal with their lenders, California has passed a bill to delay the foreclosure proceedings another 90 days beyond the filing of a notice of default. The primary method of foreclosure in California involves what is known as non-judicial foreclosure. This means that court action is not required to foreclose a home. The normal length of time once foreclosure proceedings are started is about 120 days. However there is a 90 day (three months) waiting period prior to the final 30 day foreclosure proceeding. This bill will extend the waiting period from three months to  six months.

The bill was signed into law on February 20th, and became effective until May 22, 2009

This is an excerpt as of the original posted on JD Supra. “As an add-on to the California budget package, Governor Arnold Schwarzenegger signed into law a 90-day moratorium on home foreclosures. This new law, which will become effective on May 22, 2009, requires that lenders wait an additional 90 days from the date of filing of a notice of default before the trustee can give notice of sale in a non-judicial foreclosure. Currently, lenders have to wait three months from the filing of a notice of default before providing the notice of sale, so this law, in effect, creates a six-month waiting period. This extended waiting period is intended to encourage lenders to work with their borrowers and enter into loan modifications. However, whether this aim will be achieved — and even whether this moratorium will apply in a significant number of foreclosures — remains to be seen since there are a number of requirements in the bill that must be satisfied for the moratorium to apply.

The moratorium applies only if:

1. the loan in question is a first lien loan (though it need not be a purchase money loan);

2. the loan was recorded against residential real property between January 1, 2003 and January 1, 2008, inclusive;

3. the borrower occupied the property as the borrower’s principal residence at the time the loan became delinquent;

4. the loan is serviced by a loan servicer that has not implemented a “comprehensive loan modification program”;

5. the loan is not made, purchased or serviced by a California state or local public housing agency or authority and the loan is not collateral for securities purchased by any such agency;

6. imposing such moratorium will not “require a servicer to violate contractual agreements for investor-owned loans;”

7. the borrower has not surrendered the property, as evidenced by a letter confirming surrender or the delivery of keys to the lender;

8. the borrower is not currently in bankruptcy; and

9. the borrower has not contracted with “an organization, person or entity whose primary business is advising people who have decided to leave their homes regarding how to extend the foreclosure process and avoid their contractual obligations to mortgagees or beneficiaries.” “

To read more details go to NuWire”

For further information on foreclosure proceedings go to Foreclosure.com

Real Estate

The Russians Are Coming, To Buy Real Estate That Is.

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Residence is 80,000 square feet with nine-bedrooms, a ballroom, a conservatory and a 48-car (yes, you read that right) garage, bought by Russian fertilizer billionaire Dmitry Rybolovlev for $95 million.
Residence is 80,000 square feet with nine-bedrooms, a ballroom, a conservatory and a 48-car (yes, you read that right) garage, bought by Russian fertilizer billionaire Dmitry Rybolovlev for $95 million.

I wrote in an earlier blog about the Chinese buying property in the United States because of the bargain prices of our real estate. Along with the Chinese the Russians are also buying American real estate. During the crash in the real estate market in the 1980’s the Japanese came in and bought a tremendous amount of real estate. The crash in the 80’s was due to the failure of the Savings and Loans Institutions.  Now we have a repeat of the 1980’s, with banks failing just like it was predicted when the banks were deregulated. Just like then, now some people feel that the real estate market will never be the same, but it seems people from other countries appreciate the long term value of American real estate. Consequently they are taking advantage of the real estate market while it’s at current bargain prices. .

In addition to luxury cars, vacations, branded clothing, high-end footwear, and race horses, Russia’s elite is also passionate about buying international properties. This can be illustrated by a few recent noteworthy real estate transactions such as the purchase of Donald Trump’s beachfront mansion in Palm Beach, Florida by a Russian fertilizer oligarch, Dmitry Rybolovlevy for $95 million (supposedly the most expensive residential sale recorded in U.S.) The purchase of a Manhattan townhouse by investor Len Blavatnic for $50 million, just a few blocks away from his $31.5 million townhouse he bought a few years ago, The purchase of a condo on Central Park West by former Kremlin insider Boris Berezovsky, The purchase of a ranch in Colorado by the Chelsea football club owner Roman Abramovich for $36.4 million, and the purchase a beautiful multi-million condo by Aleksey Morozov, Captain of the IIHF World Champion Russian Hockey Team.

 Moscow’s real estate is among the world’s costliest. So property in the politically stable U.S. environment is a boon for well-to-do Russians. According to Hall Willkie, president of real estate firm Brown Harris Stevens, foreign buyers now make up about 15% of the New York City real estate market and Russians are the largest contingent. The Miami area in particular, with its upscale shopping and hip nightlife, is attracting Russians and is increasingly viewed as a fashionable escape from Moscow’s harsh winters.

By the way, I see an uptick in real estate sales. As of yesterday, in Nevada County, there was 176 pending sales compared to about 120 sales pending around the first of the year. .

Real Estate

Buy a New Home, Get Income Tax Credit From State of California

tax

In order to help the construction industry and sales of newly constructed homes in California, a $10,000 tax credit is now available for reducing California State income tax. The home, either attached or detached, must be a principal residence and have never been occupied. As of March 18, 2009, 1,189 applications have been received. This represents, if all the applications are approved, $11,599,825 in tax credits. There is $100,000,000 available, so if you are going to buy a brand new house that’s never been in lived in, hurry and get your application in. Once the $100,000,000 is claimed, there will be no further tax credits.

Here is part of the text from the Franchise Tax Board:
.
“This tax credit is available for qualified buyers  who on or after March 1, 2009, and before March 1, 2010, purchase a qualified principal residence  that has never been occupied. The buyer must reside in the new home for a minimum of two years immediately following the purchase date.

California allocated $100,000,000 for this tax credit. Buyers must apply for credit allocation from us. Applications will be reviewed and credit allocations will be made on a first-come, first-served basis. Once $100,000,000 has been allocated, the tax credit will no longer be available. Please check this page for updates on the allocated and remaining credits available.

California allows qualified new home buyers a total tax credit amount equal to either five percent of the purchase price or $10,000, whichever is less. Taxpayers must apply the total tax credit in equal amounts over three successive taxable years (maximum of $3,333 per year) beginning with the taxable year (2009 or 2010) in which the new home is purchased.

Qualified Principal Residence/New Home:

A qualified principal residence means a single-family residence, whether detached or attached, that has never been occupied and is purchased to be the principal residence of the taxpayer for a minimum of two years and is eligible for the property tax homeowner’s exemption.

Types of residence: Any of the following can qualify if it is your principal residence and is subject to property tax, whether real or personal property: a single family residence, a condominium, a unit in a cooperative project, a houseboat, a manufactured home, or a mobile home.

Owner-built property: A home constructed by an owner -taxpayer is not eligible for the New Home Credit because the home has not been “purchased.”

To apply and for further information go to Franchise Tax Board”

Lakes in nevada county, Recreation

Bullards Bar Lake, Dobbins, California

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Emerald Cove Marina - photo courtesy of Emerald Cove Marina
Emerald Cove Marina - photo courtesy of Emerald Cove Marina

While Bullards Bar Lake is not in Nevada County, it is close enough to Nevada City and Grass Valley as to make it a designation for water skiing, house boating and fishing. It’s only 21 miles north of Nevada City off of Highway 49 in the historic gold country. The two closest cities are Nevada City, Grass Valley and Marysville.

The lake surface is at 2,000 foot elevation, 16 miles loan with about 60 miles of shoreline. The boating surface is 4,700 acres, which is a lot of area to boat in. There are only two launch ramps and once you are in the water, you are surrounded by a greenbelt covered with pine, oak, fir, madrone, dogwood and other species of trees native to the area. As you cruise up into the North Yuba Canyon, sheer cliffs of granite come down to greet the crystal clear water.

The North Yuba River is backed up by Bullards Bar Dam which is an awesome sight all by itself. Standing 645′ above the canyon floor, it holds back 960,000 acre feet of water. It’s the second tallest dam in California, 5th tallest in the United States. A hydro-electric dam, Bollards’ Bar Dam is operated and controlled by the Yuba County Water Agency. They are able to manage the water so that recreation access to the reservoir is never restricted.

Bullards Bar offers boat access campgrounds, land based sites, and shoreline camping permits. There are a total of only 160 sites, which limits the amount of people the area can accommodate. Emerald Cove takes site specific reservations for all camping.

For the fisherman, there are kokanee salmon, rainbow trout, german browns, largemouth, smallmouth and black bass, crappie, catfish, and bluegill. Bullards Bar has a reputation as having the best kokanee salmon fishing in California.

CAMPING
39 Boat access campgrounds – Call for reservations & fees
Pets, Full Hookups, RV & Trailer Storage, Disposal Station, Flush Toilets

BOATING
Power, Row, Jet ski, Windsurf, Canoe, Sail, Water-ski, and Inflatables are allowed.
There is a full service marina with gas and propane available
Rentals: Fishing Boats with Motors, House Boats

RECREATION
Fishing
Swimming, Picnicking, & Hiking
Snack Bar, Groceries, Bait & Tackle

For further information and reservations contact   Emerald Cove Resort and Marina (530) 692-3200


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Real Estate

Countrywide Sues AIG, AIG Sues Countrywide

gavel

American International Group also well known as AIG, and Countrywide Financial Corporation have sued each other. Countrywide sued AIG’s United Guaranty Indemnity Company for breach of contract in a dispute over insurance losses for subprime mortgage loans now in default.

In turn, AIG sued Countrywide last week in a California federal court, contending the lender had misrepresented risks tied to more than one billion dollars of mortgage loans that United Guaranty insured.

According to Reuters  ”United Guaranty said in its court papers that unlike the traditional use of mortgage insurance, used to facilitate home purchases by responsible borrowers, Countrywide wanted coverage to increase the credit rating of its mortgage-backed securities offerings.

It said Countrywide traded on a long-standing relationship between the two companies to induce it to insure loans it says were too risky and not issued according to proper underwriting standards. It says it has already paid out insurance claims of more than $30 million tied to the Countrywide loans and is exposed to additional claims of “several hundred million dollars more.”

A Bank of America spokeswoman declined to comment on the litigation on Friday. The bank bought Countrywide, once the largest U.S. mortgage lender, for about $4 billion in stock last July as the lender’s risky subprime mortgage loan business began to fail.

An AIG spokesman said Countrywide made misrepresentations and did not follow appropriate underwriting standards, and as a result “exposed us to claims we would not have had to pay out. Now we want the court to order them to make us whole.”

If I had to bet who is going to win this lawsuit, I would place my money with AIG. Having heard much about Countrywide lending practices while we were in a heated real estate and mortgage lending market, I don’t think AIG is going to have much trouble finding problems with the way Countrywide made their subprime loans before the company went belly up. But anyhow, that’s just my opinion based on hearsay.

By the way, can Congress get over the bonus that AIG gave out and get on with the important business of getting this Country back up and running? I think the news media and Congress have spent enough time on this that the CEO’s of large corporations “get it”.

Real Estate

Mortgage Rates Drops to Near-Record Lows

moneyhouse

Mortgage rates are dropping to near record lows – below 5%. This is in the wake of the Federal Reserve’s decision to buy up Treasury bonds and mortgage securities. Lower rates may help spur home sales, but analysts expect much of the action to come from homeowners seeking to refinance.

If you are in the category of refinancing, expect tighter rules and regulations, meaning you have to have a good credit score, equity in your home and there will be tighter debt to income ratio requirements. Keith Gumbinger of HSH Associates, a publisher of mortgage information, said good interest rates were available to all kinds of borrowers in all kinds of credit circumstances when the market was running flat out five years ago. That’s not the case today. “You must be a much better borrower than you had to be before,” he said. “For some borrowers, you might have to get used to hearing ‘no.’”

Be careful when you apply for your refinancing. I have a client who is in the process of refinancing her home. She applied at Countrywide and had me look at what they were going to charge her to refinance. They started out with 2 points or 2 percent of her loan to as part of the cost for refinancing. In addition, they had enough garbage fees that the total refinancing would have cost her $11,000 for a $417,000 loan. I had her shop at two other loan companies, and her costs dropped to about $6,000. Countrywide, when they were made aware of the pricing from the other two mortgage brokers, dropped their cost to refinance to match the other two brokers.

Home buyers and owners who want to refinance should be prepared for a longer process, and for different rates or costs, depending on their credit scores and loan-to-value ratios. Now, there might be three or four different levels for transactions that previously would have been priced equally.

By the way, after April 27, 2009 Countrywide will shed its name that it had since 1969 and will be morph into Bank of America Home Loans. Bank of American acquired Countrywide, once one of the biggest subprime lenders last year. More on Countrywide tomorrow

Lakes in nevada county, Recreation

Scotts Flat Lake, Nevada City, CA

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Scotts Flat Lake picture from my deck March 21, 2009
Scotts Flat Lake picture from my deck March 21, 2009

My house overlooks Scotts Flat Lake and as you can see in the picture above, I get a really beautiful view of the lake . It’s a wonderful experience living above such a body of water, which is constantly changing appearance, either due to wind or other forces of nature. At times I can look out and see fog completely covering the lake, at other times; wind plays with the water and makes designs that are captivating to the eye and imagination. The lake is large enough for fairly large sail boats (my daughter had a 25 foot long sail boat that she sailed on the lake and there are  larger sail boats that use the lake), along with ski boats, canoes and small boats for fishing.

Scotts Flat Lake is at 3,100 feet in elevation and has a surface area of 850 acres with 7.5 miles of shoreline lined with a forest of pine trees. There are two launch ramps, a marina, campsites, a picnic area, sandy beaches and a general store. (My house is at 3,700 foot elevation.)

Looking at far side of Scotts Flat Lake, boat ramp and camp ground area. Notice the wind patterns
Looking at far side of Scotts Flat Lake, boat ramp and camp ground area. Notice the wind patterns

The fish in the lake are German Brown Trout, Massachusetts Brown Trout, Rainbow Trout, Kokanee, Large Mouth Bass, Small Mouth Bass, Bullhead Catfish and Channel Catfish. There are sites that are available for camping at Gate 1 with nightly single sites, and (1) one hundred person group site, Gate 2 has seventy five single sites and three group sites, one hosts twenty, one hosts thirty and  the third one hosts forty people.

Showers and flush toilets are available, along with multiple RV sites, but no RV hookupsare available. However, they do have dumping facilities for RV’s. You can bring pets, however they must be leashed at all times and they are not allowed along the beach or swim areas.

Below Scotts Flat Lake is Lower Scotts Flat, also called Deer Creek Reservoir which is much smaller than the upper lake. The only water craft I’ve seen here are mainly canoes and a few small boats for fishing.

For more information and to make reservations for camping follow this link Scotts Flat Lake Reservations

For a map of the lake follow this link Map of Scotts Flat Lake