Category Archives: First-Time Homebuyers

California picks up (kind of) where the Feds left off

Ok, it looks like there will be no extension of the federal homebuyer tax credit, BUT mark your calendars.  Beginning May 1, California will be offering a $10,000 homebuying tax credit.

Jonas Kruckenberg wrote a great article at on all of the highlights.

This program would apply to any taxpayer buying a new home and a first-time homebuyer buying an existing or new home.  The purchase must be a “qualified principal residence”.  $200 million of state money has been set aside for this program and it is based on a first come, first serve basis.

This program may help up to 20,000 homebuyers.  Check out the full article at the above link.


A little help at tax time

Kenneth Harney of the Washington Post wrote last week that the “IRS finally published the rules for the repeat purchase credit along with the key details for taxpayers…”

Harney does a great job in again detailing the specifics of the current first-time homebuyer’s and “step up” buyer’s tax credit. 

He also reminds buyers on the sidelines to get moving.  To take advantage of the credit, you must be in contract no later than April 30, and you must close on or before June 30.

Home prices and resales were up in ’09

Jen Lebron Kuhney of The Daily Transcript reported this week that the first time since 2006, the average price of a resale home and the number of sales were up in San Diego County in 2009. 

The total amount of sales in San Diego County were up 20% with 31,113 sales.  The median price of a detached home sold in the county at $385,000, up 10% for the year.  The median price for attached homes finished at $215,000, up 7.5 percent from December of “08. 

Quoting, “Industy observers said low inventory in the San Diego housing market has contributed significantly to the market firming up over the past few months.”

She also said she had spoken with Rick Hoffman, president and CEO of Coldwell Banker, who said many of his agents were experiencing “dozens of offers on some aggressvely priced properties.”   Kuhney also validated what many of us experienced last year on the “buy side”, “With little inventory at the lower price points, first-time buyers and investors are sometimes entering bidding wars for the homes that are on the market.”

Don, Laura and Martin’s Excellent (Temecula) Adventure!

In the fall of ’08, I revceived a client referral from an old friend of mine.  A young couple who was renting in Normal Heights had made that decision that they wanted to take the plunge and buy a home.

When Martin and Laura initially contacted me, they were thinking about relocating to North County.  After looking at the prices there, and then comparing them to Temecula, they decided they could get more bang for the their buck there, so Temecula it was.

Having Martin and Laura as clients was fun and enjoyable.  They had already done the leg work of getting pre-approved for an FHA loan with Chase.  When they agreed to work with me, I immediately called their loan officer to introduce myself.  The loan officer was personable and pleasant to deal with.  

Now, let’s put into context the time and place we were doing our house hunting.  By December of ’08, the financial markets were in full meltdown.  Lehman Brothers had collapsed three months earlier, and the stock market was in free fall.  The housing market, which had been weak for most of the year, had the bottom fall out at the end of ’08.  Temecula itself had boomed for most of the 1990’s and 2000’s when San Diegans flocked there to find affordable housing as prices spiked in SD County. 

The problem with Temecula was that most of the homes that were purchased during the “boom” were financed with adjustable rate mortgages.  It was the same story at EVERY house we looked at, there was an ARM loan with a second, or a home-equity line or the the owner had done a cash-out refi leaving them upside down when the market tanked.  Ooops!!!!

Although it was sad for those home owners, their misfortune provided a HUGE opportunity for people like Martin and Laura.  They had played by the old rules, they didn’t get sucked in the sub-prime world.  When they were priced out of the market a few years ago, they saved their money and waited.  Martin and Laura’s patience paid off, they were able to qualify for a substantial FHA loan in a down market.  Since they rented, they did not have any contingencies in the offers to hold them back.

Since Temecula is an hour north of San Diego, we had a pretty strict rountine on when we would make the weekly trek up to Riverside County.  I would arrive in Normal Heights around 11:30 a.m. on Sunday mornings, and then we would go in one car with Baby Lucas in tow. 

Because of the sheer volume of inventory, we thought it would be relatively EASY to find a home.  We soon found out that we were competing with ALL CASH investors, which meant we were going have to be in the right place at the right time if we were going to get an offer accepted.

We looked a lot of houses, and when I say a LOT, I mean we looked at 77 houses.  Most houses were in decent shape, some needed some MAJOR work.  One that we’ll never forget was a home that the listing agent asked us to, “Look beyond the clutter!” 

The house appeared to be pretty average on the outside, but the inside?  Oh, the clutter!!  Actually, it would not have been so bad if it had not been for the hundreds (it seemed like THOUSANDS) of all kinds of little figurines (statues).  They were in every room.  On top of that, one end of the kitchen/dining area had been turned into an office with hundreds of books and papers scattered about.  When we went in to the master bedroom, the bed was unmade, but the comforter was in such a position that it looked liked someone was curled up in the bed.  Laura said, “Ok, WE’RE LEAVING NOW” and we were out of the house in less than a minute.

Another house (not nearly as “unique”) also comes to mind.   It was a decent tw0-story, but there had been a less-than-stellar conversion of the back patio into an enclosed room.  One side-yard walkway had been redone in a really bad tile job.  The new addition looked like it had created some unique drainage problems.  When we looked in the garage, we discovered a classic car from the 1960’s that was being protected by a car cover.  While Martin and I were talking excitedly about our new find, Laura thought she smelled gas fumes and quickly exited with Lucas.  When we re-entered the kitchen, we found the car’s registration pinned to a bulletin board.  What’s THAT about we asked each other……

By the time mid-March rolled by, we were still looking.  One particular Sunday stood out.  It was the weekend before St. Patrick’s Day, and after a very hectic day of house hunting, we decided to have an late lunch/early dinner at an Irish pub we had just discovered.  The pub seemed nice enough, and we thought we could have a nice quiet snack after running around Temecula for over 3 hours.   

We knew something was up when the service was slow, particularly for me.  Martin and Laura had to wait a long time for their food.  Then the real nightmare began, someone started playing bagpipes….INSIDE the pub. 

I’ll own this, I’m not a big fan of bagpipes.  I guess they’re cool when hear from a distance, but they’re just not my thing.  But to have them in my ear in a confined space????  When my food came, it was the wrong dish.  To give the management credit, the manager came back with the right dish and comped me the meal. 

On top of the bag pipes, there were several children going around the pub doing the traditional “riverdance” type dancing, on hard wood floors, right next to our table.  I usually don’t drink on Sundays, but I think I had a glass of wine (or two) when I got home that evening.

By the time we had gotten to late March, we were all a little down (and frustrated), but we were not giving up.  

That week was pretty normal for us.  Martin and Laura would scan over various real estate websites as I would sift through listings on the Temecula MLS.  We would start comparing notes mid-week and pair the list down to 5-6 homes.  I’d call the agent on each listing for status to double check everything and we had our Sunday list.   That was our routine when we motored up to Temecula that last Sunday in March.

The first house on our list was actually an open house.  We walked in the house and no one else was there, except an agent who was holding the open house for the listing agent.  The house was almost in pristine condition, having just been cleaned.  It was a short sale and there were NO OFFERS on it.  The agent onsite could not have been nicer.  The three of us looked at a few more houses and decided we should put in an offer on the first house we saw.  Laura was giddy when she found out Temecula had a Lucille’s restaurant.  We decided to go there for a snack, and I would write out the offer by hand.  The place was crazy-busy, but I didn’t notice much because I was totally focused on the offer. 

Once I had finished the offer, and we had finished snacking, I advised Martin and Laura that we turn the offer in personally at the agent’s office.  A good omen to me was the listing office stayed open until 7 p.m. on Sunday!!!  When we arrived at the office, we were greeted immediately at the desk.   The gentleman manning the phones promptly picked up the phone and notified the listing agent of our offer.   We had an accepted offer in 48 hours.  Ahhhhhhh, we’re almost there!!! 

MMmmmm….not quite.

This was a short sale.  The listing agent (who was terrific), said we’d be in escrow in 3 weeks.  Yeaaaaahhhh….about that…….we opened escrow a the beginning of Sept. Lender’s…gotta love ’em!!  Oh that wait through the rest of spring and summer was frustrating!!!!!  

We finally closed at the end of the third week in Sept., almost a year after Martin and Laura had started their search for a home.   We did it!

I keep in touch with them on a regular basis, via phone and Facebook.  It was so cool see the photos of them celebrating their first Christmas in the new house!  Baby Lucas looked so cute peeking through the window right next to the front door.

The experience had its ups and downs, and we can laugh about it now, especially because of its happy ending.

The New Home

The New Home

Homebuyer tax credit bulletin

Kenneth Harney of the Washington Post penned an article with information regarding the first-time homebuyer tax credit.  Apparently, the IRS has its first formal guidelines on the subject.

He provides a lot of information in the article for people who either just purchased their first home, or are currently in escrow. 

It is informational, and you should always consult your tax professional regarding tax questions.

Thank you, Buyers AND Sellers!

Inman News reported this week  that the National Association of Relators recently released their Profile of Home Buyers and Sellers. 

The good news is that first-time homebuyers increased to 46% of all home sales, compared to 41% in the 2008 report.

85% of the sellers in the survey used a real estate professional, and 64% of those choose their agent BASED ON REFERRAL or PAST experiences with an agent. 

Customer service DOES pay off.

36% found their home via their agent and almost an equal amount found their home on the Internet.  This is great news for agents and Internet services. It is REALLY bad news for print, only 2% found homes via print or newspapers

I could go on and on, but I’ll let you read the rest of the article on your own.  The study mirrors my own experiences over the 18 months showing hard work and innovation do pay off for both the agent and client.

A “must list” for first-time homebuyers

Ok, let’s ASSUME the tax credit gets extended. 

Homeownership, IMHO, takes plain common sense, and Kathy M. Kristof points this out in a “primer” she penned for first-time homebuyers last Sunday in the Los Angeles Times.

I love the first section after the introduction, “What you can afford”.  This is the key.  I’m not going to repeat myself from what I’ve been writing on THAT subject over the last three months, but it all starts with affordablity.  If people had just used this simple, common sense approach Lehman Brothers would probably still be in business.

The article provides a lot of good resouces that you or your friends should find helpful.