Elizabeth Weintraub • Sacramento Short Sale Agent • Land Park

During Gov. Schwarzenneger's State of the State address at the state Capitol today, the governor announced a new proposal for another home buyer tax credit of $10,000. It was received by a big round of applause. Of course, you don't hear that applause when you skim through the goofy comments left by readers of the Sacramento Bee.

Jim Wasserman reports that the tax credit proposal, if passed, will apply to buyers of new and existing homes, and it's in addition to the $8,000 federal first-time home buyer tax credit that expires on April 30, 2009. The new proposed tax credit could possibly give qualified buyers up to $18,000 to buy a home.

The governor plans to get this money by setting aside $200 million. This is twice the amount set aside last year, and last year's California home buyer tax credit applied only to new homes, not existing homes.

There is no mention of an expiration date. I suppose this means that, like year, once the fund has been tapped, the credit goes away. Man, oh, man, if you really want to start a buying frenzy in California, offering buyers another $10,000 of free money is certainly one way to kick the market into high gear.

All I can say is if this goes through, hold on to your hat. Oh, my goodness.

I don't see the change. Do you see the change? I read new legislative bills and I wonder: Who are they helping? The Helping Families Save Their Homes Act of 2009, signed into law by President Obama on May 20, 2009, purports to strengthen the Hope for Homeowners program implemented October 1, 2008, by former President Bush.

The Hope for Homeowners Program was a joke out of the gate, and it's still a joke. Its purpose was to help 400,000 families stay in their homes. You know how many families that program has helped over the past 7 months? One. According to reputable news sources and the National Association of Realtors: one family.

The change to the Hope for Homeowners Program now lets junior and senior lienholders fully participate in the share-the-equity portion. While this is a great incentive to induce lenders' participation, it's not so great for home owners who can be forced to give away 50% of their equity in an exchange for what amounts to basically debt forgiveness through a refinance.

A separate part of the Helping Families Save Their Homes Act of 2009, providing the loan was federally related, makes banks give tenants 90 days' notice, if the home is sold to an owner occupant. If the home is sold by the bank to an investor, the tenants' lease stays in place. Great news for tenants. Bad news for Sacramento home buyers.

This means if you buy a bank-owned home in Sacramento and intend to occupy it as your primary residence, you might have to wait 3 months to actually move into that new home if tenants live there. OK, 30 days for the escrow plus 2 more months. Does that sound like a good deal to you?

The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com

Photo: Big Stock Photo

Elizabeth Weintraub is an author, columnist for The New York Times'-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout Sacramento. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you.

OK, I admit it. Sometimes I play computer games. Not all the time 24/7 but a round or two of Bejeweled -- after a stressful phone call from an irate buyer's agent who can't understand that list prices of Sacramento short sales mean nothing -- keeps me in my usual calm, happy and peaceful state. For the past few months, I've been playing ZUMA, another addictive Pop-Cap game.

Zuma's premise is simple: A bunch of colored balls roll merrily along a path. A ball appears in the frog's mouth. The player aims and clicks the mouse to hit 2 or more same-colored balls in a row, which removes the balls from the path before the remaining balls fall into a hole. There are levels, and each level is more complex than the last.

Now, you may wonder what does ZUMA have in common with buying a home? To win a game of ZUMA, a player must be skilled at aiming correctly and instantly deciding whether to use the ball in the frog's mouth or to right-click to change the color of the ball. Speed, concentration and accuracy are essential. But much also depends on which balls are rolling along, and a player has no control over that aspect of the game.

Conversely, when a first-time home buyer in Sacramento decides to buy a home, to have any chance of landing the offer, the buyer must be decisive, write a clean offer and act quickly. We are faced with limited inventory and an over supply of buyers in Sacramento. Sometimes, though, no matter how skilled a buyer's agent, a buyer may need to write a number of offers to get one offer accepted.

On the other hand, sometimes a buyer can get lucky, and all the stars in the universe are aligned correctly. First-time home buyers for Natomas had been waiting for just that right moment. They called me several months ago to inquire about buying a home in Sacramento. Their lease does not expire until mid August, so I suggested they wait until mid May to begin making offers on a short sale.

We looked at homes last Saturday, but nothing really appealed. Saturday afternoon, a new short sale listing popped up in MLS. I called the seller to make an appointment, and the seller was very reluctant to give me the appointment at the time I wanted, but I was persistent. I don't take no for an answer.

The buyers loved the home. It was exactly what they wanted. But it was only one day on the market, and it was a weekend when many listing agents don't answer their phones (because unlike me, some agents actually have a life). We looked at the comparable sales to determine how high we would need to go on price. The comps dated back to December, which meant they won't be used for an appraisal. And they were $40,000 over list price.

I called the listing agent. She answered. We talked. Discussed comps. Got the information I needed and told the buyers they might get the home at $20,000 over list price. We wrote the offer and included a document that prevents the seller from accepting any other offers or sending any other offers to the bank.

The buyers were so excited by the process that they shot photographs of each other signing the purchase offer. Afterward, the husband leaped out of his chair, threw his arms around me and hugged me. It was one of those spontaneous things. Very sweet.

Yesterday morning I received the signed offer from the listing agent. The buyers are elated. We are waiting for short sale approval. The door of opportunity had been opened for these buyers, the timing was right and they made a fast decision. If any one of those elements had been changed, they might not have gotten the home.

P. S. By the way, I am up to Level 12-6 in ZUMA. At some levels, if you mouse over the main menu game bars, it will play the tune to Close Encounters and a space ship will appear. Just thought you'd like to know that.

Photo: Elizabeth Weintraub

The Short Sale Savior, by Elizabeth Weintraub, now available at Amazon.com.

Elizabeth Weintraub is an author, columnist for The New York Times'-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout Sacramento. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you.

It's bad news at the Sacramento County Tax Assessor's office, according to KCRA. I was interviewed yesterday for a special KCRA Channel 3 TV news report. It will be broadcast within the next couple weeks, and I'll let you know the date.

The problem is the Assessor's office is projected to lose about $10 million in property tax revenue due to falling Sacramento home prices, making 2009 the worst fiscal year since 1975. Budget cuts are underway, which means more layoffs.

But what this means to new Sacramento homeowners is your property assessment will most likely NOT be adjusted in a timely fashion; buyers who purchased a home at a lower-than-assessed value will end up making payments on the higher assessment for the next year or two.

The Sacramento County Assessor's website says it will eventually issue a refund, but to qualify, the homeowner must be current by paying all property taxes in full. The reporter for KCRA told me he spoke to the Assessor's office and was told that despite the previous 6-month lag time, the wait will be closer to 18 to 24 months.

Here is what the Sacramento County Tax Assessor's PDF says about homes purchased after January 1, 2009: "Sales of properties after January 1, 2009 will be assessed beginning in July 2009, and the new value will appear on the 2010-11 annual tax bills to be issued in October 2010."

So, if you've bought a home this year that was previously assessed at $500,000 -- but you paid $250,000 -- you will pay taxes on that $500,000 assessment until the county has the resources to reassess; and there's nothing you can do about it. That, to put it mildly, sucks. That's an extra $3,000-plus per year for a homeowner to cough up.

If you've bought a foreclosure or Sacramento short sale, make sure you set aside extra funds to pay your taxes this fall and next spring. If your loan is impounded, your mortgage lender may be collecting monthly prorata taxes based on your purchase price. This means by November 1, when first-half property taxes are due for 2009 / 2010, your impound account may reflect a shortage.

The Short Sale Savior, by Elizabeth Weintraub, coming May 15th.

Photo: Big Stock Photo

Often, I hand out printed copies of my home buying process article to first-time home buyers in Sacramento when we first meet. It walks buyers through 18 steps, from hiring a buyer's agent to closing. I suspect they read through step 17, and then jump back to step 3: looking at homes for sale. Because searching for a home is a lot of fun.

Well, I think so. Some buyers may disagree with me. I love to look at homes. Not all buyers enjoy that part. Not every buyer wants to trudge through foreclosures, interrupt short sale sellers during dinner or stand in the pouring rain while their agent frantically searches the bushes for the hidden lockbox.

Buyers then get caught up in the entire home buying process -- selecting a sales price, negotiating the offer, getting a mortgage. If they don't remember to ask when they get the keys, I explain it, but still, sometimes buyers think they get the keys when they sign their loan documents. I don't know about other agents, but the highlight me for as a buyer's agent is handing over the keys to the buyers.

If you are a Sacramento home buyer, generally you will get the keys when your agent has received confirmation that your transaction has recorded, meaning when the deed from the seller to you, and your trust deed, has been stamped and placed in the public records.

It's not simultaneous, of course, but if you read your contract, down at the bottom of the first page, it should say when possession occurs. On my contracts -- knowing that we might have an afternoon recording, as opposed to a morning recording -- I make the time 5 PM. That's because even if we do a "special recording," I know I'll receive confirmation by the latest at 4:30 PM.

Realize, too, that if you're buying a foreclosure, you may not receive every key to the house because the bank may not have it. For example, if your mail is delivered to a central mailbox location that requires a key, you may need to apply at the post office for a duplicate key. The bank will not provide it.

But the most important thing you can do at closing is ask a locksmith to meet you at your new home to rekey the locks. I advise buyers to change the locks on any home, not just on a foreclosure. If you need a referral to a locksmith, ask your agent. Changing the locks may take some of the excitement out of receiving the keys but, trust me, getting new keys is essential to your happiness and security.

The Short Sale Savior, by Elizabeth Weintraub, coming in June 2009.

Photo: Big Stock Photo

A reporter from FOX40 news called yesterday. He asked: "Where are the good areas in Sacramento to buy right now and what constitutes a good deal?" After all, he had just purchased a $250,000 home in Elk Grove -- a home that would have sold for more than half a million a few years ago.

I introduced this FOX40 reporter to clients who are presently in escrow. This husband and wife team established a budget for their home search and scoured the Internet. They printed out my list of 10 questions for Interviewing an Agent, marched down to my office and interviewed me. Then, they interviewed other agents and came back to say they wanted to hire me.

After touring homes in their price range, I thought to check on a home that had fallen off their radar. That home was still available. We made an offer and negotiated counters until the buyers were satisfied with the terms, and now they are 2 weeks away from closing.

Filming will take place at their new home in Sacramento this morning. I'm not sure what the interview will consist of, just that the reporter wants to talk with me as well and, you know me, I've always got something to say about the market. So you may see me on the news Monday night. I won't see it unless my husband tapes it. It's on past my bedtime. But if it shows up as an online video, I'll post a link to it for you.

The Short Sale Savior, by Elizabeth Weintraub, coming in June 2009.

Photo: Big Stock Photo

8621 Sebrell, Sacramento, CA 95823, priced appropriately at $175,750.

This is a stunning single-story, three-bedroom, two-bath home in the Elk Grove school district with soaring ceilings and an open floor plan. It will take your breath away. The interior has been custom finished, featuring interesting angles, arches and beautifully crafted ornate woodwork.

The kitchen is huge and open to the family room, plus there is space for a breakfast table in the kitchen. Cherry manufactured wood floors throughout match the cherry cabinetry in the kitchen, along with a complementary built-in china cabinet. The kitchen appliances are high end, Miele and Thermador stainless steel. French doors with glass insets and transoms lead the way to the library / third bedroom, which features 3 floor-to-ceiling built-in bookcases and two ornate columns, plus plenty of closet, drawers and storage space.

Located on a quiet street, the home has more than 1,800 square feet and a much newer feel to it than the year it was constructed, 1999. Check out these photos and then call Elizabeth Weintraub, 916.233.6759, Lyon Real Estate, for a private showing. Offer subject to third-party approval.

8621 Sebrell, Sacramento, CA 95823, priced appropriately at $175,750.

The Short Sale, by Elizabeth Weintraub, coming from publisher Archer Ellison in January 2009.

Photos: Elizabeth Weintraub

What if you were thinking about going into business for yourself and was told that you'd work long hours, drive all over town for days on end, share your expertise and wisdom with a client with absolutely no guarantee that you'd ever receive compensation for your work, would you be eager to go into the business? Yet that's what some buyer's agents do in real estate.

I referred out-of-town buyers to an agent in an outlying office of Lyon Real Estate because I don't work in the Sacramento foothills and felt I would be doing the clients an injustice if I accepted the job. The agent I referred them to has been in the business for more than 20 years and was extremely familiar with her neighborhood and home prices.

This agent picked up the clients from the airport on a number of occasions, took them to lunch, showed them neighborhoods and homes, helping them to get their bearings to decide where they wanted to live. She spent several months with the buyers and felt she had established good rapport. Last week the buyers sent her an email thanking her for her time, adding that they bought a new home directly from a builder's representative. The agent's response to me was, "It happens."

It happened because she let it happen. Buyers know what they are doing when they decide to dismiss a buyer's agents efforts and hand over a paycheck to another.

The first words out of my mouth when I talk to a potential buyer are: "Are you working with another real estate agent?" A buyer I wrote an offer for last month told me she had been working with an agent but decided instead to work with me. Fine, here, sign a buyer's broker agreement. When we wrote an offer she said, "It's too bad that Susan hauled me all over town and isn't going to get paid for this."

She knew.

None of this dampens my enthusiasm for the business. I love it. And I love working with home buyers. But I do expect loyalty. Why other agents don't is beyond me.

The Short Sale, by Elizabeth Weintraub, coming from publisher Archer Ellison in January 2009.

Photo: Big Stock Photo

From 2002 until several years ago, the average sales price in Land Park, Sacramento, hovered around $400,000. At the same time, the $200,000 market in the rest of Sacramento was disappearing. By 2005, that lower-end $200K price range had just about vanished, which meant many first-time home buyers were priced out of the market. They simply could not afford to buy a home in a desirable neighborhood.

All that has changed by December 2008. Not only that, but the flippers are back.

More than 56% of all sales in Sacramento County last month were under $200,000, with 38% of the sold homes falling between $200,000 and $400,000. Want to know how many homes sold in Sacramento over $400,000? Less than six percent! In fact, the average per-square-foot price for Sacramento fell in November to $124. Moreover, REO bank-owned homes under $200,000 were priced at $95 per square foot. Can you believe it? A 1,500 square-foot home for $142,500? A home priced at $142,500 equals a mortgage payment, with taxes and insurance, for less than $1,000 a month!

In the four-county area of Sacramento, homes priced under $200,000 make up 44% of all homes for sale in November. Due to declining interest rates, this means a first-time home buyer or investor can buy a home in the $200K price range for a total PITI payment of less than $1,400 a month. You can't build homes at those prices -- they are selling under construction cost. Mortgage payments are less than rent. It's a buying bonanza in Sacramento.

A mortgage broker from Orange County who sometimes guest writes mortgage articles for my About.com home buying site emailed me last week. An online group was feeding her listings in Sacramento and padding the sales prices by 10%! (It takes all kinds in this market.) So, I scouted some of my favorite neighborhoods and found her a home that she could buy with a positive cash flow, cutting out the crooks. Those types of deals are out there.

If you'd like more information about the Sacramento real estate market, or the homes in Land Park where I live, feel free to call Elizabeth Weintraub at 916.233.6759.

The Short Sale, by Elizabeth Weintraub, coming from publisher Archer Ellison in January 2009.

Photo: Trendgraphix

Is it possible to hire a home inspector who does such a terrific and thorough job that listing agents cringe when they hear his name? I have heard grumblings from previous home buyers who had hired a bad home inspector. And, of course, the person they blame is the buyer's agent. They believe that an agent-referred home inspector will not disclose potential and / or glaring problems in the home simply to save a relationship with the buyer's agent.

Got to say it's a possibility. There are agents who don't want buyers to receive a thorough home inspection because when defects are discovered, the buyer might cancel the transaction. If the transaction cancels, the agent won't get paid. Although it's against the law for a real estate agent to do business that way, some do. Some agents recommend home inspectors who produce two- or three-page reports. They want the inspector to tell the buyer that defects are no big deal. The home inspector complies because the home inspector wants more referrals from the agent. 

I'd be sticking my head in the sand if I didn't admit these sorts of things go on in the business. It's outrageous, unethical and against the law. It's not in the buyer's best interest, and those agents and inspectors should be flogged and barred from real estate.

The fact is home inspectors in California are not licensed. Anybody can slap on a tool belt and print business cards.

While I want my home buyers to receive the very best home inspection that is possible, I also believe in allowing the buyers to choose their own home inspector. It's their future home, and they are paying for the inspection; it's their decision to make.

I have put together a list of reputable home inspectors, the guys and women I have personally worked with who have gone that extra step to provide superior information and service to buyers. I encourage my buyers to call all of them, interview them, ask about guarantees, rates and experience, and then make a selection. If they don't like any of the inspectors, I direct buyers to four other web sites where they can do further investigation.

I want every single defect disclosed to buyers. Not only because it is the ethical thing to do, but if a defect is discovered after closing, I can be of little help at that time. The time to find out about a problem is before closing so we have time to get it fixed, ask for a closing cost credit or cancel the transaction. I work hard to ensure my clients are thrilled with my performance at closing. Happy clients equal future referrals.

Most inspectors belong to an inspector trade association, which sets minimum requirements and offers continuing education programs, but membership in a trade association is no guarantee of expertise. Some are former builders. All boast glowing recommendations with years of solid experience.

My favorite is a forensic investigator (builder, consultant and home inspector) who is often called as an expert witness by prosecutors to win court cases involving home inspection lawsuits. He is thorough to the bone and leaves no stone unturned. He's also more expensive than the others, but he's worth it.

His reports are personally typed. Many inspectors use forms. This home inspector does not. Instead of submitting pages of disclaimers, his reports contain solid facts, narrative disclosures specific to the property and run 20 pages or more. He also mails via USPS color prints (not digitals) to the client. Actual color photographs. How old school.

He performed a home inspection for Sacramento buyers in South Land Park. Many of the homes in South Land Park are 40- to 50-years old, built on raised foundations. His report uncovered structural issues that I'm fairly confident another inspector may have missed. As a result, we negotiated the repair of those issues, running thousands of dollars, which the seller has agreed to pay. When I mentioned to the listing agent that this inspector was a forensic investigator, the agent replied that he had never read such an extensive home inspection report. Then he added, "Don't ever hire that home inspector again." He was joking, I hope.

The Short Sale, by Elizabeth Weintraub, coming from publisher Archer Ellison in January 2009.

Photo: Caylyn Wright, used with permission