Sacramento Real Estate Blog

They say only two things in life are certain, death and taxes.  I’m happy to report that as Realtors®, we don’t get asked about death a lot, but people do often have questions about property taxes.  We often hear questions like:  “Aren’t California property taxes expensive?” and even more often, “What is the tax rate in [Name Your Favorite] County”.

Folks within the state are trained to ask, “Does this property have Mello Roos?”, whereas folks from out of state think a Mello Roos is a laid-back male chicken — a myth I will dispel conclusively as we go along.

Yes, I know, that was pretty bad.  I’d better get right to the article, at the risk of further taxing your patience.

1) I Live Out Of State and Have Heard that California Property Taxes Are High.  Is That True?

Actually, yes and no.  It’s more correct to say that California property values are high.  Many property taxes are taxes that are levied “according to value”, but we often say ad valorem because saying things in Latin is so much more fun.  Because of this, according to the Tax Foundation, California ranks #10 from the top in the median property taxes paid on homes among the fifty states, but ranks 46th (i.e., 4th from the bottom) in terms of the property tax rate. 

Statewide, our ad valorem property taxes were limited (by proposition 13) to 1% of the market value, and there rate of increase was limited to a maximum of 2% per year for inflation.  (In other words, in the first year they’d be 1%, the second year 1.02%, etc.)  Later, Proposition 8 required assessors also have to take possible devaluation into account, hence Purva Brown’s recent post about Sacramento County taxpayers getting a lower bill.

2) What’s the Tax Rate in Sacramento County and Surrounding Areas?

Though our statewide rates are limited to 1.0%, voter approved bonds and fees can and do increase that figure.  Both Sacramento and El Dorado County claim average tax rates of 1.1%.  When I first got into the real estate business, I was taught to use a more conservative figure of 1.25% to give to my clients as a ballpark number, and most lenders I know use that estimate when calculating the Tax component of PITI (Principle, Interest, Tax, and Insurance).  In all these cases, we’re talking about an initial rate based on the market value at the time your home was sold.

3) What’s A Mello-Roos, and Do I Want One?

Proposition 13 was originally passed in 1978 because older Californians were being priced out of their homes by the ever-growing tax burden, given the wonderful appreciation we enjoy in California.  (Ahem:  well, most years we enjoy it, anyway).  Of course, once you limit the amount of taxes counties can collect, now you’ve got a new problem, especially as new communities develop — how do you pay for things you might want, like streets, water, drainage, sewage facilities, policemen, parks and recreation.  Along came state Senator Henry Mello and Assemblyman Mike Roos, who co-sponsored 1982′s Community Facilities District Act, which allowed communities to pay for these services through bonds when 2/3 of the voters in the district approve them.  Bonds issued under that legislation still (accusingly?) bear the names of the authors of the bill.

Of course, being bonds, the good news is that unlike taxes, they’re eventually paid off.  The bad news (can you say “proposition 13 loophole”) is that now your effective tax rate could be 2.5% or more depending on how much the Mello-Roos bonds bring to the table.

4) Are there Any Mello-Roos Bonds On [Name Your Property Address]?

Well, you’d think we could just go ahead and give you a straight answer to that one by looking in the MLS or calling up the county assessor’s office, wouldn’t you?

Well, yes and no.

The good news is, that in most cases we can get you more information from the county, or in certain cases you can even go online yourself and check.  (We’ll do a tutorial on this soon).  The reason we have to say that “in most cases” is that Community Facilities Districts who issue Mello-Roos bonds may ask the County Tax Collector to include this lien as part of your biennial tax bill.  They may, and in most cases they do, but here’s the problem:  they don’t have to.  For example, the El Dorado County Tax Collector shared with me that the city of Placerville has several properties with 1911 bonds (another form of special assessment) that aren’t on the tax role.  So folks in those areas of Placerville get a separate bill.  Although most Mello-Roos bonds and other special assessments are levied through the county tax collector, if you call any assessor or tax collector in any county, you’ll no doubt come up with several similar exceptions to that rule.  The bottom line is can get you an answer that has maybe a 95% chance of being right within a business day of hearing from you.

5) How Can I Find Out More about Mello-Roos and Other Special Assessments for the Home I’m Buying?

Fortunately, the State legislature has your back on this one, and enacted legislation in 1992 requiring the seller and the listing agent to disclose whether there are Mello-Roos bonds on the property.  In 1992, legislators noticed that some builders were cleverly using other forms of special assessments to avoid having to disclose that they had Mello-Roos bonds.  (“Hey we don’t have any Mello-Roos” [wink, wink]).   Senate Bill 1122 therefore extended this disclosure requirement to other forms of special assessments.

Now if there’s one thing broker’s don’t like (other than water chestnuts — I hate water chestnuts), it’s having liability to disclose something that the seller may not even know, especially where the information is not obvious and our usual way of finding out the answer is right only 95% of the time.  So naturally, companies have sprung up to do the disclosing for us.  One such company that we particularly like is Property ID.  Property ID provides natural hazard disclosures, but as part of their report they also include a special assessment disclosure that is ensured up to $20 million.  We always write Property ID into our agreements asking the seller to provide this when writing up a purchase agreement.

Most agents don’t order Property ID or another disclosure report up front, but if it’s available, we’re happy to provide it to you prior to opening escrow.  Usually you get the report while you’re in escrow and under your inspection period.  If you really want to try to nail it down with more certainty, you might try ordering a report from Mello-Roos.com, but most of our buyers have found that checking with the assessor up front and then getting Property ID (or a report from another reputable disclosure provider) in escrow is a cost-effective alternative.

Related Stories

Sacramento Property Taxes Fall

I’m Moving to the Sacramento Area, and am Over 55. Can I Keep My Tax Base?

My sponsorship web site for my participation in the El Dorado County Food Bank Walk For Hunger is now live.

Click here to sponsor me in this event.

Thanks to local supermarket sponsors and other efficiencies, the El Dorado County Food Bank distributes $9.00 worth of food for every dollar they get in contributions.  Moreover Elite Properties will match every dollar you contribute, up to the first $100.  So if you contribute $10, that means $180 in food for needy families.

Help us reach our goal of $200 or more.

A few bucks.  A few minutes.  And a few hungry families get to eat. 

How cool is that?

Yes, I know I said it somewhere before, but since the Sacramento Bee is reporting it, it bears repeating. Many home owners will see their property taxes decline this year. Taxes are based on assessed value as of January 1, 2007. Since market values have fallen, Proposition 8 requires the government to take falling values into consideration and drop taxes accordingly.

Most people that bought homes in 2005 and 2006 will see a reduction of about 5% to 10% off their property taxes.

This might mean that their monthly payments will go down and if they have an impound account, they might receive an unexpected check in the mail.

You can read the entire SacBee story here.

We’ve published the first of our subscriber only discount coupons.  This one is valid for homes purchased throughout October and can save buyers and sellers several hundred dollars in closing costs.  We have just started making these discount offers available to those who subscribe to our blog, which you can now do either through an RSS reader or by email.  A few days ago we mentioned we were testing it out, and now it seems to be working OK, so we hope to have a different offer published about every month or so.

From time to time we may also offer bonus content and free stuff via the same subscriber-only mechanism.

I’m also pleased to announce that the subscribe by email feature is getting more activity this time around than the last time I tried it.  I think the incentives are part of this, but I like to think we’ve also made some good content improvements in the last week or so as well.  Thanks to all who’ve signed up so far!

Related Posts:

Sacramento Real Estate Discounts

New Subscribe by Email Feature

I will be participating in the El Dorado County Food Bank‘s  Walk For Hunger, scheduled for Saturday, November 10, 2007.

I am proud to announce that the way I found out about this event was a legacy of the blogathon for hunger that Bridget and I did last year on another blog.  Hence the nice letter from The Food Bank that I got over on the right.

I’d like to ask for your ideas and input about how to make this a more effective event.  For example, I signed up as a team, and I could sponsor a “virtual walker” or two and raffle off their tee shirts to the subscribers of the blog. 

I should have some kind of matching contributions set up and a way to sponsor me officially online in a day or two.

Meantime, if you just can’t wait to help out, that’s a good thing.  If so just click here to make a donation via PayPal.

Or if you prefer to donate at a national level instead of supporting some county you may or may not have heard of or care about, click the America’s Second Harvest banner below.

Here is that link I promised:

Click Here To Sponsor Me

As you can see when you follow that link, Elite Properties will match your contributions up to the first $100.00.

One statistic that you may be interested in is that for every dollar you contribute, the  El Dorado County Food Bank distributes $9.00 worth of food.  With the matching contributions, that means that $10.00 from you provides $180.00 in much needed food to hungry families.

Again, if there are other ways you can think of to make the event more successful or if you would like to walk with me as part of the Elite Properties team, let me know.

It Pays to Subscribe

We’ve started to write about the valuable discounts we provide on our real estate services that are available only by subscription to our blog / newsletter.  In the future we may also be offering additional discounts and prizes that other merchants may provide, and other incentives to subscribe.

The point here is to develop a stronger readership of local people who may be interested in real estate, not to trick you into giving up your email address.  I don’t sell email addresses, and no one so far has found themselves stuck in a home because I spent my days emailing “buy a house, buy a house, buy a house” to my unsuspecting victim.  These discounts and other incentives will also be available to those who subscribe to the feed in an RSS reader.  (What the heck is that?  We’ll have a tutorial coming soon).

Today we’re taking our first step toward implementing this by installing the software that will show you these discounts if you are subscribed.  At the moment we’re still in a testing mode to see if the plugin is on and putting together our first discount offer(s), but if all goes as expected (he said, crossing his fingers) we should be able to announce that our subscribers-only discounts are live within a post or two.  Meantime if you subscribe now you’ll get these discounts when they’re ready. 

No, that’s not shamelessness.  It’s “transparency”.

Related Articles

New Subscribe By Email Feature

I am pleased to announce that we are now offering you two ways to subscribe to the Sacramento Real Estate Blog (see the form at the left).

The subscription form says “Weekly” but please note that for subscriptions processed before October 15th, you may receive messages more often. We’re in a testing and roll-out mode, so we have it set to send messages more often.

For those of you who don’t want to mess around with RSS readers, or don’t know what one is, or don’t care what one is, you can now subscribe via email to get the latest Sacramento real estate news, including market updates, tutorials, the latest real estate bargains, and many new features that we’ll be rolling out in the weeks ahead.

After that, I think weekly is a good schedule. Leave me a comment and let me know if you prefer weekly, daily, monthly, what have you.

After all, we think most buyers and sellers will benefit from a more email-friendly approach, since RSS stands for “Realtors Sure Subscribe”.

“If you don’t subscribe, the terrorists win.”
– New York Mayor, Rudolph Giuliani

“Aren’t you going to laugh at my nose too?”
– Rudolph the Red Nosed Reindeer

Congratulations to CAR, the California Association of Realtors®, on their new CAR Legal Blog.

As a working real estate broker, I consider the chief benefit of all the Realtor® organizations to which I belong to be the state-level legal hotline.  It seems like once every couple of months or so, a question will come up that’s a bit of a legal stumper, and the attorneys on CAR’s legal staff sort it out elegantly and professionally, usually in less time than it takes to get an order of fries with no salt.

I look forward to reading their blog, and also commend their decision to make it available to the public instead of by sign-in only.

If you’re a landlord, or manage property for someone else, you MUST have a story to tell! We’re inviting you to tell us those stories. We’re working on putting together an e-book with axioms every landlord must follow to have a successful investing future.

Please go to www.SacramentoRealEstateGal.com and comment on the posts to submit your stories, anecdotes, advice or what have you. You will be featured in the e-book, but we could change the names of your tenants to protect their privacy.

Please contribute.

My recent video about how to sell a home fast in any market was driven home today by a question I got from a buyer who previewed some homes with me yesterday.

The home they asked me about was an absolute keeper, at a price that beat out all the comps not only for its neighborhood, but for any other comparable neighborhood in Sacramento County.

In fact, this was one of a few homes that was such a screaming good bargain that two buyers had asked me about it, and I was really thinking I should post it here but didn’t want to have a conflict of interest with those buyers.

Their question was about whether I could call the agent to find out why it had been on the market so long. Well, I was happy to do that, and knew that while I was looking up her number I could look up the listing history, knowing that the price change would probably tell the tale.

Here’s what I found:

If You Don’t Understand Why The Price Is So Low, Blink

Darn, pending sale — I’d have to tell the buyers that. But there’s more of a tale here.

Of course, the buyer doesn’t have this info readily available, so their question was perfectly natural, “Why has it been on the market approximately six months?” From a Realtor® point of view, however, this isn’t a $299,000 home that’s been on the market for six months, but a $299,000 home that sold after ten days.

In the MLS, the actual pending date is 10/3, but it was entered on 10/4 as you can see above. The price was dropped from $325,000 to $299,000 on 9/24, and now there are three offers on it. 9/24 to 10/3 is ten days.

The price it started at, $395,000, is actually almost justified by the current sold comparable sales. But $299,000 is where it needed to be to finally get it done, in a slow Fall with few buyers.

Fortunately for my buyer, it turns out that there is still a possibility of making an offer on this one, so I let them know that — we even have a pretty good idea about what we need to offer.

The Market Within The Market: What’s Being Sold Here, Anyway?

There are several morals to this story:

• Some buyers are waiting for market prices to come down another 25% or so, and some buyers are out there buying homes that are already reduced 25% or so.
• If you wait until the market comes down, then you get to compete with a lot of buyers. If you wait until there’s a good bargain on a house you want now, you get to compete with fewer buyers. If you think sellers won’t see you coming ten minutes after all the buyers come back and start adjusting prices upward, then you make the classic mistake of thinking yourself the only greedy party to the transaction.
• A lot of people are selling you the market, and if you’re buying a market, then you shouldn’t buy a house. The question a smart buyer asks is “am I buying a market, or am I buying a house?” There are great buys in bad markets, and dumb buys in great markets.

I’ve actually been counseling my buyers to consider some other homes that are lower priced than this, because in their situation it makes more sense and I don’t want them to get overextended. Now the trick is to find them the perfect $340,000 home that’s priced at $260,000.

In fact, instead of writing about the market, which is kind of depressing, I think a really good article series would be “bargain of the day” (or week, or whatever). In his response to Jim Kramer, Gary Keller notes that there is a “market within a market”. As I say above, there are great buys in bad markets, and dumb buys in great markets. Keller makes a similar point.

Whether you’re buying now or later, buy well. If you’re not buying at all, that’s cool, too. If you are, call, and we’ll go bargain shopping.

A friend at ActiveRain asked me recently about the lack of comments.

It’s an experimental move.  They’ve been mostly down for a little over a week, and I fixed a bug or two in the template over the weekend. 

To date I haven’t found them very useful, and potential clients have no trouble with the phone number and contact form available from every page.  I try to make ways to respond pretty obvious, and it seems to work out well.

I may restore them later if it looks like the blog just can’t get along without them.

What’s to be done about NAR and Realtor.com?

Nothing.

Stephen Colbert recently aired a segment about the “Don’t Taser Me, Bro” guy, the student who was subdued during a John Kerry speech recently.  He praised (i.e., criticized — viewers of the show will understand what I mean) the student’s peers for doing nothing to help him at the time, then going off to blog about it.

One could make a case that as a society we have become massively deficient in our ability to work together toward a common good (if we ever were any good at it — cf. Howard Zinn).  We have become a nation of amateur writers, and amateur critics of amateur writers.  If our remote ancestors were hunter-gatherers, we could quip that we have gone through the inevitable middle stages such as shopper-borrowers, and have become, inevitably, writer-commenters.

If you’re a home buyer or seller, you may neither know nor care that the folks at ActiveRain recently failed in their attempt to sell their company to Move.com, who’s parent company, Move.inc also owns Realtor.com.

Buyers don’t care.  Sellers don’t care.  But among Realtors® and other users of ActiveRain and people on the outside who wanted to write an interesting article, this upset a lot of people.  At least one lender was mad because he naturally feared that if ActiveRain were sold to a a Realtor®-heavy organization, there might be no place for content written by affiliates such as lenders.  Most of the Realtors® were upset because they don’t like Realtor.com®, and didn’t want content they’d developed being used to compete with them.  So there were a lot of threads on ActiveRain about this.

Feeling their pain, compassionate fellow bloggers of course rose to the occasion to do what compassionate fellow bloggers always do — write a post or two rubbing salt into the wounds.

Here are a couple of gems that show this incredible outpouring of sympathy toward their colleagues in action:

“As of this moment, at least 90% of the blogs on Active Rain suck because the writers never learned there’s a larger point than getting points.”

and

“I suppose I should care more than I do about the failed ransacking acquisition of Active Rain by Move.com. What’s less than zero?”

One day when she was in second grade, I had to pick my daughter up because the other kids were picking on her relentlessly.

There’s no finer sport on the Internet for most people than finding someone who’s made a mistake or is hurting for some reason, because you can use the second grade logic to reason that somehow their mistake makes you look good.

You know, if someone trips on the playground and you stop to help them get up and get them a glass of water, then you look good.

You people aren’t in second grade any more.  You should know that.

One person asked about income and gross rent multipliers following up on my Duplex article.  To be sure, historically these numbers haven’t been great for Sacramento County, but I’ve seen some (larger) multi-unit properties pencil out quite nicely since things have started to decline.  I guess my point was that with almost five hundred units in inventory, there may be some that represent an opportunity, and the numbers are moving in the right direction at least.  If someone were interested, I’d naturally be happy to dig further into individual units. 

The other thing that’s overlooked is that duplexes aren’t always sold to traditional investors, even though they’re categorized as investment properties.  Another common scenario is the extended family, in-law quarters or place for the kids, etc.  Sometimes they’re half owner occupied, half investment.

The National Association of Realtors finally answered this question for frustrated sellers. In fact the number one answer has not changed since 2004 – it’s central air.

The second thing rated most important by home buyers is an oversized garage. In 2004 it used to be a walk in closet in the master suite.

The last few on the list are: Backyard, Cable/Satellite TV ready, High-speed internet access, Separate showers in the main bath, a patio and fencing around the home.

In fact, the majority of buyers are willing to pay a premium for the walk-in closet, hardwood floors, and granite countertops. Sellers, are you listening?

Mitch Argon, who was nice enough to refer two of the nicest clients you could hope to work with lately to us earlier in the year, dropped me a note recently to tell me about his new web site about Reno Real Estate.

Now usually, you don’t want your Realtor® moonlighting as a fry cook or rodeo rider or what have you, but there are a few exceptions. With this in mind, one of the neat things about Mitch is that he also runs a moving company, so hey presto, instant free moving services when you buy or sell a home with Mitch. I don’t know if you’ve priced those services lately, but depending on where you’re moving that can be a huge savings.

Mitch is a really good guy and a true professional, so if you’re planning a move to Reno, you should definitely check his site out and give him a call! Naturally his site features registration free search, so give it a spin.

Vicki Agregado-Babcock and I will be holding our Fort Jim listing open this weekend.

Please come to our Open House this Sunday, September 23, at 1:00PM to 4:00 PM for our beautiful listing at 3400 Fort Jim Road, Placerville.

For the map, click here.

The California Association of Realtors® now has a Second Life Office.

This just proves what was proven in 1849 — you make more money selling shovels and pans to people prospecting for gold than you do prospecting for gold.

Nerds.  Honestly. 

All your dues are belong to us.

Every so often I go hunt for a picture of old Herb Tarlek, or should I say a picture of actor Frank Bonner playing Herb Tarlek, WKRP’s slick but sleazy salesman.

I usually think of old Herb when someone’s accused me of being like him, either personally (which doesn’t happen much), or as a member of the Realtor® community (which happens all the time).

Here’s the accusation:

“Western Civilization is on the verge of collapse. The sky is falling. The four horsemen of the apocalypse are upon us. We’re on the verge of a bloodbath. Of course, if you’re a Realtor®, any time’s a good time to buy a house.“

Whether that’s true of any given Realtor® is a function of what their strengths are as a salesperson. Realtors® who are aggressive objection handlers might be a good fit for that accusation, but I tend to be fairly laid back in that regard.

My strong suit in sales is not objection handling, but prospecting. That being the case, I don’t much care if someone is not buying a house, because to me that’s hardly the point. The point for me is not that everybody needs to buy a house, but that as many people as possible who want to buy or sell one find me or an Elite Properties agent to do it.

In fact, come to think of it, whether or not you’re buying a house is not an objection handling matter. It’s a qualifying matter. If you’re not buying a house, that’s great, but then as a broker, my job is not to talk you into it, my job is to go talk to someone who is qualified. That is to say, someone who is “qualified” in the more general sales sense of having DNA (Desire, Need, Ability), not qualified in the loan sense, which simply deals with “Ability”.

On the one hand, I certainly don’t mean to suggest that you have to be buying / selling right away to start a conversation. I do have other interests. If I only talked to people who are buying or selling, I’d have a boring life, because even among people who own already, only one in eight is moving in a given year. People don’t eat all day long, and they can eat at many different restaurants, but one can still own a thriving dining establishment nevertheless.

On the other hand, I have a feeling that people who hang around real estate blogs saying things like “if you’re a Realtor®, any time’s a good time to buy a house” want this accusation to be true, because it’s the basis for the adversarial relationship they imagine they have with us. And I can’t imagine how lonely you have to be before your idea of a social good time is trolling for a guy who in your broken heart of hearts you think is Herb Tarlek.

If you’re not buying a house, that’s great. You’re in the majority. I congratulate you.

So you’re here…why?

Have you considered taking up ballroom dancing?

They’re going to live there for a while, so it’s technically not a flip. But my clients that bought a fixer close to Curtis Park last October have made such a difference to their house I was amazed. I spent some time with them this morning and came away quite stunned.

The stairs leading to the front door have been redone. The house has been painted. The floors are new (bamboo) and the bathroom has been completely gutted and redone with new fixtures and vanity. (They did it for $1000 which is extremely thrifty!) The kitchen cabinets have been removed and all new appliances have been put in. The garage which was almost falling over has been stood back up. The lawn is back (there was carpet on the ground!) and all new plants and flowers dot the backyard and front. The termite-ridden back deck has been removed and a new one will be put back up.

And it is all sweat equity.

In their own words, they never spend a single weekend doing anything but working on the house and if they do anything else they feel guilty. Oh, to be young and working on your first home! Sigh!

I love fortune cookies.

Maybe I’m just hungry now, thinking about Chinese food, but the quote I saw on Google Desktop, which ultimately comes from the Quotations Page, struck me as being a lot like a fortune cookie:

“A wise man will make more opportunities than he finds.”

– Sir Francis Bacon

(Mmmm… unexplained Bacon).

I’m hoping this is true, and that it’s my fortune for what I’m going to do now that I’ve lost a bit of ground in the search engines, which happened recently.

And here I thought gaining that ground was making more opportunities than I found.

You mean I have to do it AGAIN???

Well, I guess that’s what’s meant by bringing home the Bacon.

Anyway, I better get going on this appointment I have, or I’m going to miss my opportunity for dinner, Chinese or otherwise.

Let’s try it out.  Supposedly all one has to do to create an enclosure in WordPress is link to an audio file.

Quiet, numbskulls, I’m broadcasting.

Well, this post is sort of a mixed bag.  On the one hand, it’s a heads up about Maureen Francis’ article about FHA, Foreclosures and Foregiveness.

Under the hood, it’s more of a test post.  I’m writing this post from out a new browser, Flock, which I learned about through the Web 2.0 list of Web 2.0 Links.  (I think that title was written by someone who works in the Department of Redundancy Dept.)  Anyway, this new browser, Flock, is interesting in that it contains integrated blogging tools and an RSS reader with, and can detect whether a page you’ve landed on has a feed, among other handy Web 2.0ish tricks.

The blogging tool is fairly primitive once you’re used to Livewriter, but it’s interesting that it all hangs together.

Blogged with Flock

Well, here it is only 2007 and I’m finally getting around to uploading some video to the Internets.

I’m so behind. I’m sure others have already abandoned video in favor of smell-o-vision and other more leading edge “new media”.

My ultimate goal in this is to have yet another place (or bunch of other places) for my clients listings to go, such as YouTube and Yahoo Video. I also want to do some real estate screencasts about topics buyers and sellers may find useful.

As an experimental first video created with Pinnacle Studio, here’s a slide show based on my walk around Cameron Park Lake. The YouTube version is below, or there’s a slightly larger MP4 Version available from my Cameron Park Real Estate page.

I sometimes find myself feeling badly about some of the information I publish here, especially the market updates, thinking that the information they contain might be somewhat boring or trivial. Given this message I read today from Amazon.com, however, I’m beginning to think my web site is the soul of profundity itself. Thank you, Amazon, for lowering the bar, and for giving me a good laugh.

The language in this is quite off-color, so if that sort of thing offends you, don’t click it. Otherwise it’s a hillarious look at what a coroprate board meeting might look like if it were peopled by some of the commenters who might follow you home like a parade of unbidden rats from someone else’s blog.

This was originally published by CollegeHumor, a site that’s well worth your time if you have any sort of funny bone.

Congratulations and thanks to Donald and Jeanne D., buyers who get their keys today for a home they purchased for their children to use while they attend college.  Thank you again for your business, and if you have any questions or issues, please let us know!

And congratulations and as well to Jamie Boling-Puebla, their agent, whose execution on the disclosures and the rest of the file was so good that our transaction coordinator even made note of it.

Our transaction coordinator is one of those fussy, detail oriented people who’s not happy unless the file is perfect.   That’s WHY she’s our transaction coordinator!

Well, happy Friday, folks.  For many of you this means the start of Labor Day Weekend, which means many folks will otherwise would be laboring at work will be driving around laboring at having a good time.

Let me disclaim something Purva said.  Labor Day Weekend is a terrific time to buy a house, just not from Purva, since she’ll be laboring at having a good time and trying to stay away from playing too much computer chess (at the risk of having a good time).  We have agents working all weekend.  I know Bridget’s doing some showings in Foresthill.  Vicki’s manning the phones today, and Jamie is doing so the rest of the weekend.  So give us a call at (877) 735-5657 and prove Purva Brown wrong by buying one or more houses.

I’ll be working as well this weekend, though probably on several pet projects of the boss.  Oh hey, that’s me.

One of the pet projects of the boss that is on the back burner right at the moment is the ParticleWave real estate listing site.  My apologies to Dave Smith and the other intrepid early adopters.  By way of ammends, I can say that I have taken steps to getting my projectitis under control, but I hate to talk about it for fear of being part of the big trend of people talking about it.  David Allen, you da man.

Dang, there, I said it.

Metrolist MLS designates two areas as comprising “Downtown / Midtown” in Sacramento, 95816 and 95814. (To see which is which, you may find the zip code maps we’ve published elsewhere, for 95814 and 95816, to be of use.)

Today we look at 95814 by itself, which we have to do with a grain of salt. The reason is that the numbers of homes sold in this area are in general far too low to allow much in the way of generalization, much as you couldn’t guess the average height of the American male either by a single basketball player or horse jockey.

Nevertheless, for the sake of those who live there, we’ll report that this year’s nine sold units was an improvement on the the twelve-month average of four units sold per month. There are fifty-five units in inventory, which works out to a little over fourteen months worth. Only one of the four is an REO, giving us a charmingly low foreclosure rate of 1.8%, but again, remember, our overall sample size is low even at 55 actives.

The average home that sold in 95814 in July sold for $465,737, or about 97% of the average list price of $480,717. The median sale price was $475,000.

The real estate market in Folsom is somewhat stronger than Sacramento County as a whole, with lower inventory.  In July, 2007, the average home sold in Folsom for $498,793, or 98.3% of list.  This was down 5.5% from last year’s average of $527,616.  This year’s home being somewhat larger, the average price per square foot fell 8.2% during this period, from $249.94 last July to $229.33 this July.  The median price was down 4.2%, from $490,000 last July to $469,500 this July.

Unit volume is actually up slightly this year, from 73 units to 74.  This year there were 7 REOs (bank foreclosures) sold out of those 74 units, so just shy of 10%.  Last year of the 73 units that sold, none of them were REOs.

A number of social justice activists and others have pointed out the relationship between race and poverty and predatory lending practices. For example, the Center for Responsible Lending has published a study on Unfair Lending: The Effect of Race and Ethnicity on the Price of Subprime Mortgages, documenting that African-American and Latino borrowers receive sub-prime loans more often than white borrowers, even when their credit history and other lending qualifications may qualify them for a more inexpensive loan.

Unfortunately, the geographical pattern of REO (Real Estate Owned, or “Bank Repo”) sales in the greater Sacramento area tends to support the idea that the link between predatory lending and race may be a very real one indeed. I recently examined the percentage of sales that were foreclosures (REOs) for the period January 1st, 2007 to August 21, 2007. Aside from a few statistical oddities, overall the pattern was pretty clearly one in which the most foreclosures occurred in the poorest neighborhoods.

Of course, just based on such a study, it’s impossible to say how much predatory lending is the culprit, and how much can be attributed to the rather banal idea that living in poverty may make the choice between food and the mortgage more of a common one than it is for rich people.