I hope you enjoy my “too long for Twitter” newsletter!
Summer is over heating the inland valleys, so cool fog is the main tourist attraction at the coast. The tourists are shivering with delight beneath their Morro Bay sweatshirts. They’re just happy to be out of the heat for a while. Hopefully they are spending a bit of their hard earned dollars while they’re here, since it’s been a tough year for small businesses in small towns. A few tourists, as well as, myself and a few other North Morro Bay residents, were fortunate to see a pod of dolphins and even a couple of whales close to the surf line in Estero Bay. What a thrill that was! The bay is host to seals, sea lions, otters and tons of birds, but rarely do we get a glimpse of dolphins or whales. It makes me feel even more lucky, if that’s possible, to live on the beautiful Central Coast. Even though home prices have lost an average of 40% of their pre-recession values, homes aren’t moving very fast unless they are foreclosures. However, short sales and foreclosures have dwindled in the last 4 months or so, but National real estate pundits say there’s another wave of them due to hit the market soon. I’m glad the government is attempting to help some homeowners lower their monthly loan costs, but I haven’t heard of anyone being successful yet in renegotiation their loan downwards to reflect today’s home values. The county, however will reassess over-valued homes, which should help lower taxes for those who bought in the high market. Real estate is now a long term investment rather than a way of “flippin’ and making a fortune,” unless you can buy foreclosures and even then maybe not. Real estate is still the best “wealth builder” around as a long term investment and, unlike stocks, it gives you a roof over your head!
For Your Information
Is now the right time to refi? Maybe, mortgages rates are around 5%, or so, for a 30 year fixed rate loan and less for a new adjustable, if you can find it. (Wells Fargo seems to be doing them… today anyway.) The best refi deals are for those who (1) have a loan limit below $600,000, or whatever the conforming rate is in their area. (2) You should have 20% equity minimum, plus a credit score of over 700 and plan on staying in your home for a while, since it usually takes over a year to break even because of the cost of the refi. (3) You need to be able to actually “qualify” for your new loan. This includes your income and assets and they will be verified. No more “stated income” loans. It’s a catch 22 because if you need to refi to lower your payments, so you can afford the payment, you might not quality for the new loan. The government does have a new program for those who have no late payments for the last 12 months, to help them renegotiate with their current loan company to accept less than is owed. Then the original loan is paid off and a new “downsized” loan is funded at a lower rate. It’s complicated, but worth the hassle. Call Fannie Mae at 1-800-732-6643, or Freddie Mac at 1-800-373-3343, or go to www.freddiemac.com/avoidforeclosure
Los Osos Sewer update. The SLO County Planning Dept has been working diligently on the proposed sewer project. The final EIR was released in April. There are two possible sites with the least impact to the environment that are acceptable to the county. The County Engineer in charge, John Waddell (788-2701, has said that the assessments will vary, but a “typical” home assessment will be $25,000.00. If the homeowner chooses to pay off the assessment through their property tax bill, it will cost them $2,400.00/year. There’s also an option to pay the additional $50.00/month it will cost to hook up to the sewer as an addition to the tax bill. This would raise the yearly bill to about $3,000.00 per year. In addition, it is estimated to cost $200.00/month for maintenance fees. Residents have been fighting this sewer project for 30+ years. Unfortunately the costs have risen so dramatically that many residents cannot now afford the costs. It is hoped that the sewer will qualify under President Obama’s stimulus package which would be a huge cost benefit to residents if this happened, especially if “we the taxpayers” foot the bill, or part of it anyway.
