As we approach spring, and all its glory – warm and sunny weather, flora and fauna, outdoor activities, an occasional rain shower, weddings, graduations, baseball, and traditionally a good time for the real estate market – is our real estate market poised to spring forward?

Over the past year, generally speaking, the real estate market in Petaluma has stabilized (certain market segments have decreased, i.e. distressed sales, while other market segments have gained some slight appreciation, i.e. those who purchased short sales or foreclosures at discounted prices). A question that I am often asked is “when is the market going to get better?” The answer to that question depends on your situation – if you’re a buyer, the market is definitely better because home prices have decreased significantly since the peak of the market in August 2005, thus making homes more affordable: lower property taxes, which are based on the purchase price, so the lower the home price, the lower the property taxes, and interest rates have been at record lows.

Many first-time buyers became disappointed when the Home Buyer Tax Credit expired in 2010, however, it’s a better time to buy now because home prices are a bit lower, interest rates are lower, and if you compare the cost of purchasing a home now versus last year when the Home Buyer Tax Credit was available, it is financially better to buy now.

Move-up buyers are also taking advantage of lower home prices. Yes, a home in today’s market is quite a bit lower than in 2005, but so is the replacement home that a move-up buyer will purchase once they sell their existing home (if a current homeowner is in a position to hold their real estate and rent it out, hopefully the property will cash flow or break even, then they may reap the rewards in the future if the property appreciates).

Another factor that may help the stability of the real estate market is the potential for a housing shortage. According to Mike Castleman, founder and CEO of Metrostudy, which tracks real-time data of the country’s inventory of new homes, a housing shortage is looming that may soon create a demand for new homes. As explained in this CNN Money article, our nation is facing a historic drop in new construction (new home inventory is currently at less than 25% of what it was during the 2006 boom). He predicts that lower prices will soon drive buyers back to the market, however, there will be fewer new homes for them to buy and it will take builders time to ramp up their construction efforts. During that lull, homebuyers will bid the prices up due to the lack of available inventory.  

Posted by:  Doug Hecker

Spring is here, and all members of the Duran Group are excited, but especially John. Mainly because on Wednesday nights John and his friends can be found in Sebastopol singing their hearts out with the “Love Choir.” I am sure many readers are curious as to what songs John and the gang may be singing, but the other members of the Duran Group have decided it is best that they not know. This is one of the many things that make living in Sonoma County great: there is literally something for every person to do.

Many people find that when they are looking to buy a home they do not have as much spare time as they would like, as the entire process can be quite time-consuming. That is why we at The Duran Group strive to make the experience as stress-free as possible and we found the article 6 Myths of Buying a Home, published in USA Weekend on March 20, 2011, to be of particular interest to us, and hopefully our readers. 

To summarize, the article says that many buyers believe the perfect home is out there, but it is important to remember that buying a home is “essentially an exercise in compromise” and buyers must choose a few “must have” elements that are necessary for them. It is also important to remember that buying the largest home as you can get shouldn’t be your main objective anymore. Instead, you should focus on how much space you really need to maintain a comfortable lifestyle, not necessarily an excessive one. The last myth addresses the stress inducing offer and negotiation portion of the process. The myth is that “if your offer is accepted immediately, it was too much.” However, the reality, particularly in today’s market, is that buyer’s remorse is common. But if you were comfortable with your offer when making it, then second-guessing yourself is an exercise in futility.

Have a great week!

Posted by:  The Duran Group

In this second article in a series “In Defense of Flippers,” I will address another allegation made in the December 26, 2010, Press Democrat article “Flipping Foreclosed Houses.” The article stated, “The financial returns can be eye-popping. One investor purchased a Santa Rosa home at auction for $153,575 and sold it 30 days later for $330,000 – a 115 percent markup.”

Yes, that is indeed an enormous profit – if, in fact, it is accurate. I don’t know the specifics of the example noted above, but I can speak to the processes of purchasing and flipping houses and perhaps shed some light on the realities of the business.

Up to one day before the scheduled sale date, banks will publish the list of homes they are foreclosing on. Investors who wish to bid on those homes have just a few hours to search county records to determine whether there are any outstanding liens on the property and if clear title can be conveyed. In a normal sale the buyer purchases title insurance, and the title company will issue a preliminary title report which lists any outstanding liens, easements or other impediments to receiving clear title. In these foreclosure sales there is no time to search title in a manner sufficient to issue title insurance. Therefore, the investors must rely on their quick research and hope nothing comes up later that might impede their ability to resell the home.

In many, if not most, normal sales there is a new lender involved. In foreclosures, it’s all cash. So the investor must be willing and able to immediately present a cashier’s check for the entire amount of the purchase.

At the time of the foreclosure sale, the homeowner or tenants may still be in residence. In many of these cases, the investor as the new owner will contact the occupants and offer “cash for keys,” which is exactly what it sounds like: several hundred to a couple thousand dollars for the occupant to move out within a specified period of time.

When bidding on properties at auction, the buyer often has not seen the inside of the property and has no knowledge of the condition of the home. Depending on the condition of the home, the property rehabilitation may involve a new roof, new paint, repair of dry rot or other moisture related damage, new flooring, cabinets, countertops, plumbing, landscaping, doors, hardware … the list goes on. Obviously, some investors do a better and more comprehensive job than others, but there are numerous costs involved in fixing up a property for resale.

During the rehab process, the investor also incurs carrying costs. They may be making interest payments to a private lender, and they are paying property taxes, utility costs, and sometimes homeowner’s association fees. When the property is ready to resell, they pay real estate commissions, county and city transfer fees, and other costs associated with selling a property.

And when the property is put up for resale, the return they make on their investment is entirely up to the prevailing market. In the case of the original example noted above, the investor’s profit could indeed be north of $100,000. The norm is far less than that, however, and the same investor might barely break even in the next project, or even lose money. But when all is said and done, it is these business people who accept the risk and either reap the rewards or pay the financial consequences.

In the third and final blog in this series, I will address how these investors benefit their communities. Meanwhile, I’d like to add my thanks to Deanna Majcherek of First American Title for her background information from the title company’s perspective.

Once again, I’d like to invite your questions, comments and input into this dialogue.

Posted by:  Deborah Byrne

Last time we discussed tips for buying real estate during the holiday and winter months. While inventory is down during these times, it can nonetheless be a great time to sell! There is less competition from other sellers, and the buyers out there are motivated. Here are a few more tips:

1. With leaves falling from the trees, and the landscape not in bloom, make sure you keep leaves raked, the front porch tidy, and the front walk swept. Keep that first impression positive.

2. Keep the entry inviting by putting a wreath on the front door and potted plants on the porch. Anything that sets the tone for a warm and inviting entrance into the home will be noticed by prospective buyers.

3. When the days are dreary and overcast, make sure your home shows bright and warm. Consider turning more lights on during the day, keeping window coverings opened, and turning up the furnace a bit. There only needs to be a few degrees difference from the outside temperature to make a big impact.

4. Holiday decorations can be welcoming and charming if not overdone.

5. If your landscape is particularly nice, consider putting out a small book of pictures showing the garden in full bloom. That will help prospective buyers envision the springtime panorama.

No matter what time of year, a good Realtor is an essential part of your strategy when buying or selling real estate. For more tips, or to answer any of your questions, please give me a call.

Posted by:  Deborah Byrne

The holidays and winter months shouldn’t be ignored as good times to buy real estate. In fact, most holiday seasons I stay busy negotiating and closing deals for my buyers. There is no doubt that many sellers take their homes off the market in December and wait for the warmer, dryer springtime to re-list their homes. But if you are a buyer during this time, here are some helpful hints:

1. Don’t be afraid of a little bad weather. Brave the elements and keep looking at homes, and you just might be rewarded by finding the perfect place to hang your hat.

2. Look beyond dormant landscaping. It’s true that homes don’t always look their best when the landscape isn’t in full bloom. But if you learn to recognize some of the plants and trees and flowers surrounding a property, you might soon realize that there is a wonderful garden just waiting to surprise you.

3. Don’t settle for just the currently active listings. Ask your Realtor to check for listings that have been temporarily taken off the market to see if any of them still want to sell. I often contact colleagues about properties that I know are temporarily off the market, and we will set up a special showing to see if the property meets my buyer’s needs.

4. Motivated sellers are often flexible sellers. Sometimes you’ll find that a seller whose home is listed throughout the holidays is a truly motivated seller, and they will entertain a lower offer than they normally would. That’s money in the bank for a buyer who is just as motivated.

5. Hire the right Realtor! An agent who is creative, motivated, flexible and energetic throughout the holiday and winter months can help you find the right home. And remember, as a buyer, you do not pay the Realtor’s commission – our fees are paid by the seller.

For more tips, or to answer any of your questions about real estate, please give me a call. And, by the way, Happy Holidays!

Posted by:  Deborah Byrne

Have you always wanted to know the chemical content of well water? Do you have a crying need to know the top five pests that might harm a Heritage oak? Are you craving a cram course in the finer points of a septic system? Then consider the possibility of owning country property.

Country property can be described as 100 acres of hillside, 4 acres of pasture land, or even a half acre on a well and septic system. Sonoma County has lots of country property – in fact, I understand that more properties in Sonoma County are on a well and septic system than are on public water and sewer. It can be daunting if you are unfamiliar with the concepts, but the rewards of country living can be well worth the extra attention to details. If you have a yen for gardening, a passion for horses, or simply a desire to have a bit of elbow room, country property can be your oasis in a busy world.

In addition to the usual pest and home inspections of residential property, country property may also entail inspecting and testing wells, pumping and inspecting septic systems, arborists’ evaluations of trees, evaluations of hillside soils and stability, confirmation of boundary lines, and investigations of easements, to name but a few. It is generally important to review the permit history with the County, and to understand the zoning restrictions and allowable uses of a particular property. Once you’ve done your homework, with the proper guidance from an experienced Realtor, of course, the satisfaction of living in your own little piece of paradise can be a dream come true.

If you want to explore the option of country property – or any other property in Sonoma or Napa Counties, please give me a call at 707-484-4045.

Posted by:  Deborah Byrne

Is seller financing right for me?

7220 Hayden, Sebastopol

Seller financing can be complicated, so I recently asked my favorite lender, Megan Sovel, of Blue Oak Mortgage about the benefits of seller financing. In her usual gracious style, Megan explained seller financing for me and truthfully, there’s no reason to change up her explanation.

Seller financing IS currently permitted on Conventional Financing, given the terms and borrower qualifications conform to all of the lender’s guidelines. In short, the benefit of seller financing in today’s market is that it allows the buyer/borrower to maximize their purchasing power by minimizing their down payment.

In the past, conventional second mortgages (Home Equity Line of Credit and Closed End Loans) were a popular and smart option for buyers who wanted to take advantage of a low down payment but still avoid the added expense and qualifying restrictions that come with Mortgage Insurance. As the market has turned, however, these purchase money seconds from conventional lenders have all but disappeared as the risk has far outweighed the lender’s returns on their investment. There are currently no banks giving second mortgages above 80% of the appraised value of the property (and in most cases they cap at 70% or 75%). That’s where seller financing can comes in as a huge buyer incentive.

Assuming the seller has the available equity and is willing to carry the Promissory Note for the borrower, Fannie Mae & Freddie Mac currently allow for a combined loan to value of up to 95% of the property’s appraised value. This means that the buyer could get an 80% loan to value first mortgage through a conventional lender, a 15% seller second mortgage, and contribute as little as 5% of their own funds toward down payment. This would allow the buyer to avoid Mortgage Insurance and, in some cases, possibly qualify for a Conventional loan (versus FHA) when they otherwise wouldn’t have (due to some pretty strict current Mortgage Insurance restrictions on credit score, debt to income ratios, reserves, etc).

Additionally, the seller financing can also help make up the difference between purchase price/appraised value, and a conforming loan amount ($417,000), which carry slightly lower rates and monthly payments than High Balance Conforming or Jumbo loans.

Now, that said, the terms of the seller financing will be have to be reviewed and approved by the first mortgage lender and pass all Fannie Mae & Freddie Mac guidelines for second mortgages. For instance, the seller’s financing cannot amortize (have a term) less than 5 years from the Note date, cannot have a Pre-Payment Penalty (“early termination fees are allowed permitting they don’t exceed $500), cannot allow for any negative amortization (the borrower must make at least Interest Only payments), and cannot exceed certain limitations on rates & fees. Furthermore, in addition to qualifying for the Conventional first mortgage, the borrower WILL have to qualify for the entire principal and interest payment on the seller’s note, and the lender may require an additional review of the appraisal in order to verify that the property value meets their minimum criteria.

All in all, seller financing has some huge benefits for potential buyers. While not many sellers have the luxury of offering that option to buyers in today’s market, it can be an extremely beneficial option for buyers looking to “think outside the box” of conventional mortgage financing.

Posted by:  Martha O’Hayer

1721 Spur Ridge, Healdsburg

As you may have found, this is a testy Real Estate Market. There are no guarantees that the lenders will provide enough to cover the sale of the home. Often, buyers don’t have enough cash for a 20% or even 10% down payment. Therefore, sellers of homes in certain price ranges and regions may need to come to the table with inventive ways to attract potential buyers. I’ve seen sellers offer exotic vacations, appliances, even boats and cars to sweeten the deal.

Gifts are nice, but the most attractive incentive to a potential home buyer is a lower price. However, sometimes even that isn’t enough if comparable properties are also reduced or there is an excess of inventory. In this case, one creative option to consider is seller financing.

Here are two properties currently for sale in Sonoma County that feature seller financing. Both are lovely with fresh remodeling and seller financing may just be the ticket to make them available to a buyer who may not have the opportunity or the cash in their account to make the purchase work otherwise.

1721 Spur Ridge, Healdsburg 

7220 Hayden, Sebastopol  

Posted by:  Martha O’Hayer

Over the past few weeks I have been asked several times, “Is this a good time to buy a house?” The complete answer depends on each individual situation, but in general there are several factors that indicate this is, indeed, a good time to buy. Here’s why:

• Interest rates remain low. They fluctuate, of course, but as of today hover under 5% for a 30-year fixed loan.


• While home prices generally are not as low as they were a year ago, especially in the “entry level” ranges, they are still far lower than at the top of the market. In some cases my clients are finding that their mortgage payments are roughly the same as paying rent. When you factor in the tax benefits, the picture looks even rosier.


• For those looking for investment property, this is the first time in many years that an investor might break even or have a modest positive cash flow. Lenders will generally require a 25% down payment for investment property.


• Many times bank-owned properties have a lot of deferred maintenance but are good bargains. If you are willing to put up with the inconvenience and extra work of buying a bank-owned property, you can move in with instant equity.

If you want to sit down and “run the numbers” just give me a call. I’ll be happy to help you figure out if now is the right time for YOU to buy.

Posted by:  Deborah Byrne

If you’re lucky enough to live in the State of California, enjoying the great climate and geography, diversity and culture, history and charm, arts and entertainment, and landmarks and outdoor activities, you may also be able to add tax credits to the list of fringe benefits of living in California if you purchase a home soon.

With home prices and interest rates at historical lows, fortunate home buyers in California may qualify for a federal tax credit up to $8,000 in addition to the recent state tax credit up to $10,000 (if you time your purchase right over the next few months). However, taking advantage of Uncle Sam’s generosity will have to be timed right and not all may qualify. Many home buyers who plan to be in escrow by April 30, 2010 and close escrow by June 30, 2010 realize they qualify for up to an $8,000 federal home-buyer tax credit.

An eligible taxpayer must purchase, or enter into a binding contract to purchase, a principal residence and close escrow on or before April 30, 2010. However, the tax credit will qualify if a binding purchase contract is signed by April 30, 2010 and escrow closes by June 30, 2010.

Many home buyers may attempt to delay their close of escrow until after April 30, so they can also qualify for the new California home-buyer tax credit, which was signed into law recently. The state credit is worth up to $10,000, spread over three years. Although the chances of taking advantage of both tax credits is relief to many prospective home buyers, timing is key and the amount of buyers who will benefit from both credits may be slim.

To qualify for both the state and federal tax credits you must buy the home as your principle residence, you must be in contract on or before April 30, 2010 and you must close escrow between May 1, 2010 and June 30, 2010, and meet all other requirements. Timing will be tricky, especially if you’re in escrow on a foreclosure or short sale, which may not close escrow in the short window of time to take advantage of both tax credits.

Prospective buyers who have already locked in a mortgage rate may lose their rate, or will have to pay an additional fee to extend their rate lock (if they choose to postpone their closing to possibly reap the benefits of both tax credits).

The federal tax credit for first-time home buyers (the IRS defines a first-time home buyer as someone who has not owned a principal residence the past three years prior to the purchase) is equal to 10 percent of the purchase price (up to a maximum of $8,000, as the tax credit applies only to homes priced at $800,000 or less). The tax credit doesn’t have to be repaid unless the home is sold or no longer used as the buyer’s principle residence within three years after the purchase.

Buyers can claim the federal tax credit when they file their tax return (or amend the prior year’s return). This credit is refundable and the entire amount will be paid, even if you have zero federal tax liability or the credit is more than your federal tax.

The credit is also valid for current homeowners buying a replacement principal residence. Eligibility to claim the tax credit states that the buyers must have owned and lived in their previous home for five consecutive years out of the previous eight years. The tax credit is equal to 10 percent of the purchase price (up to a maximum of $6,500 and the tax credit applies only to homes priced at $800,000 or less). The credit is available if the home was purchased between November 7, 2009 – April 30, 2010. However, the tax credit will qualify if a binding purchase contract is signed by April 30, 2010 and escrow closes by June 30, 2010. The income limits are $125,000 for single taxpayers and $225,000 for married couples filing joint tax returns. The tax credit doesn’t have to be repaid unless the home is sold or no longer used as the buyer’s principle residence within three years after the purchase.

The State of California tax credit is the lesser of 5 percent of the purchase price or $10,000. First-time buyers can purchase a new or existing home but repeat buyers can only purchase a new home that has never been occupied.

The California credit is spread over three years, up to $3,333 per year and it is not refundable. If you owe less than $3,333 in one (or more) of those years, you lose the difference that year. Even if you owed $3,333 before you owned a house, you might owe less due to of all the new tax deductions.

The state credit does not have an income limit or purchase price limit, however, some buyers who fall below the income limits for the federal credit might not owe enough California tax to get the full benefit of the state credit.

To get the California credit, you must close escrow between May 1, 2010 – December 31, 2010, or whenever the money for the program runs out, whichever comes first (the money will probably run out before December 31, 2010).

The state credit for new construction can be reserved if you enter into a contract between May 1, 2010 – December 31, 2010 and close escrow prior to August 1, 2011. If you choose this route, you will not qualify for the federal credit because you entered into a contract after April 30, 2010.

Buyers should consult a well-informed tax advisor and understand both credits.

Posted By: Doug Hecker

As a Realtor, I am aware that short sales are here to stay for the next few years. It’s a fact that I prefer to ignore. I’m invited to attend short sale seminars by the dozens. I’m asked to embrace them as a way of life in the Real Estate World. I have yet to represent a short sale seller, by my own choice. I refer the business to someone who has the patience to deal with the lenders, the seller, the calls, the faxes, the lost paperwork, etc.

I have, however, represented many buyers in short sale transactions. Until recently, these transactions were a waiting and wondering nightmare that cause buyers to say “Why won’t anyone take my money?! All I want to do is buy a house. I have a 30% down payment and I can get a loan, why won’t anyone [seller’s lender] talk to me?” When the buyer has been complaining this way for 8 or more months, it’s hard to offer an adequate explanation. There really is no good answer. That is, until recently.

This week, my buyers received lender approval on a short sale offer we made only six weeks ago! Yes, that seems like lightening speed compared to four, five, six months with no response. Additionally, this lender is providing the seller with a $5000 move out credit. That’s right, real money to move for a seller that has been hit hard with financial woes. Amazing.

So, who is this magical lender with the power to respond to offers in 7-10 business days or less? Who can close a real estate transaction in an average of 37 business days, start to finish? Who is this lender that provides local contacts who understand our market conditions? Who is it?

It’s Wells Fargo Home Mortgage – formerly Wachovia. Wells Fargo Home Mortgage has developed a field short sale program where field managers are assigned areas where they will provide outreach to sellers about their options regarding short sales. These same managers provide a point of contact to the Realtor Community as well. In fact, the very person who approved our short sale in six weeks spoke to our local Chapter of Realtors this week in Petaluma. I was so impressed that I went up, introduced myself and shook his hand. Thanks, Sam Bedros!! You may make a short sale believer out of this Realtor after all.

Posted by:Martha O’Hayer

According to CNN Money Magazine’s 2010 real estate profile, Napa, CA is ranked #17 in the nation for forecasted price appreciation. Money details that many cities close to the Bay Area saw a huge run-up in home prices during the post 9/11 boom that lasted through 2006.

Napa is a very well recognized city in Northern California’s wine making region, known for world class culinary dining experiences and vineyards. Napa is also one of the largest cities north of the Golden Gate Bridge with a population of 133,522, according to Money.

Santa Rosa is the largest city in northern California’s wine country with a population of 154,200, which also neighbors iconic and timeless rural Kenwood, CA. Money ranked Santa Rosa #1 in the nation for forecasted price appreciation.

According to market information, prices grew more than 121% from 2000 to the early 2006 peak and have since fallen more than 45%. Today Money concludes that the decline is over and Santa Rosa prices will gain 6% this year, more than any other U.S. city, while at #17, Napa prices will gain 2.3% this year.

This being recently reported, each property situation may be less ordinary and more unique from the median and averages calculated or forecasted by Money Magazine.

Weigh in with your opinion by posting a comment on how you feel about buying real estate in 2010.

For more information about your relocation, next move, or unique properties across the Bay Area contact Ernie Basoco at 707.292.0192 or visit www.ebasoco.com.

Posted by:Ernie Basoco

Living in Santa Rosa just keeps getting better and better…

According to Money Magazine, Santa Rosa’s real estate prices will gain more than any other U.S. city this year and the forecasters are saying the decline is over. Full article.

This is no surprise to me with over 50% of Santa Rosa’s available inventory in contract.

For everyone who’s been waiting to see what’s going to happen with our local real estate market, now is the time to purchase real estate in Santa Rosa. Look at how Santa Rosa compares to other cities in California. In my opinion, they have this information backwards. The list should be reversed, and we should be on the top where we belong. Can you tell I love Santa Rosa?

Don’t forget that Santa Rosa also has the distinction of being one of the 5th happiest cities in America according to the Huffington Post, and Santa Rosa is applying for Google’s ultra-fast Internet network for residents.

Like I said – living in Santa Rosa just keeps getting better and better…

Posted by:Beth Urban-Purtell

What is a HUD home?
A HUD (US Department of Housing and Urban Development) Home is a 1-4 unit residential property that is backed by the Federal Housing Administration (FHA) and is now in foreclosure. When someone with a HUD insured mortgage can’t meet the payments, the lender forecloses on the home; HUD pays the lender what is owed; and HUD takes ownership of the home. HUD then sells the home at market value through a Marketing & Management Contractor such as PEMCO.

Who can sell HUD homes?
Any licensed real estate agent or broker who is registered with HUD may sell HUD Homes.

Who can buy a HUD home?
Any buyer with available cash – or who can qualify for a loan (subject to certain restrictions) – can purchase a HUD home. Initially, priority is given to those who are buying the home as their primary residence. After the priority period, unsold properties are made available to all buyers, including investors.

How do you find HUD homes?
Finding a HUD home is as easy as clicking on hudpemco.com, searching under properties for sale in California, and selecting the home or income property of your choice.

How do you purchase a HUD home?
Once you are interested in a property, contact a federally approved California HUD real estate broker, like the Duran Group, and they will provide access to these properties and handle all the bidding, contracts, and disclosures processes on your behalf. A real estate broker must be properly registered with HUD to submit contracts for purchase or any HUD home.

Where can I learn more?
Visit the US Department of Housing and Urban Development website – and particularly the HUD in California section.

If you’ve always wanted to take advantage of the opportunities of purchasing government owned Real Estate, now is the time. Do you have any other questions about HUD homes? Have you had experience buying one? Please leave comments below or contact the Duran Group directly.

Posted by:Raina Duran

Friday, President Obama unveiled a plan designed specifically to help the five states hardest hit by the housing crisis, including California. The new initiative calls for state housing finance agencies to create locally tailored solutions to help keep homeowners in their homes and stabilize the housing market so home values can rise. More details here.

Several efforts have come out of Washington to help reinvigorate the housing market, including two home buyer tax credits, which are set to expire April 30, 2010. This means that while there are still about ten weeks to go, time is running out for homebuyers to qualify, as a typical escrow lasts 30 days.

Below is a quick breakdown of what you need to know. For further reading, the National Association of Realtors has a very informative site highlighting the Basics to the Extended Homebuyer Tax Credit. You can also visit www.federalhousingtaxcredit.com.  

$8,000 First-time Home Buyer Tax Credit at a Glance

• The $8,000 tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.
• The tax credit does not have to be repaid unless the home is sold or ceases to be used as the buyer’s principal residence within three years after the initial purchase.
• The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
• The tax credit applies only to homes priced at $800,000 or less.
• The tax credit now applies to sales occurring on or after January 1, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
• For homes purchased after November 6, 2009 and on or before April 30, 2010, single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

$6,500 Move-Up / Repeat Home Buyer Tax Credit at a Glance

• To be eligible to claim the tax credit, buyers must have owned and lived in their previous home for five consecutive years out of the last eight years.
• The tax credit does not have to be repaid unless the home is sold or ceases to be used as the buyer’s principal residence within three years after initial purchase.
• The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500.
• The tax credit applies only to homes priced at $800,000 or less.
• The credit is available for homes purchased after November 6, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, the home purchase qualifies provided it is completed by June 30, 2010.
• Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

Posted By: Edward Reiners

I’ve had the privilege of working with many first-time home buyers over the years, and I find that the same few questions are consistently asked when we begin working together. As in most trades, we get so familiar with the lingo and the process that we tend to forget to explain things in plain English to the novice real estate client.

Here are the top four questions I get asked by first-time home buyers:

1. How much do you charge? The commission is paid out of the seller’s proceeds. Any property that is listed in the Multiple Listing Service has an associated percentage that the seller will pay both the listing agent and the cooperating (buyer’s) agent. 
2. Can you still help me if I want to see a home that another real estate company is selling? Yes, all agents have access to the Multiple Listing Service and can show any home that is for sale. 
3. What’s the purpose of the good faith deposit? A valid contract must have several elements, including what we call “consideration.” In this case, the consideration consists of the good faith deposit money (usually $1,000 to $5,000). The check, made payable to the escrow company, is held un-cashed during the negotiation process. It is only sent to the escrow company if and when there is an agreement between the buyer and seller and we can open escrow. At that time, the escrow company cashes the check and holds it in escrow until completion of the deal, at which point it is released to the seller as part of their proceeds. If during the inspection process the buyer decides not to buy the house, then the escrow company refunds the good faith deposit to the buyer.
4. What are closing costs? Closing costs are all the costs associated with purchasing property. Some examples include: loan fees, recording and notary fees, escrow and title company charges, interest payment to the new lender, the first year of fire insurance, and impound payments of taxes and insurance, if applicable. Together with the lender and the title company, I always provide my clients with an estimate of closing costs so they are fully aware of how much cash they must have in order to close the deal.

Are you a first-time buyer? If your questions weren’t answered here, please contact me at dbyrne@fhallen.com or leave a comment below.

And remember, if you’re anxious to take advantage of the $8,000 first-time home buyer tax credit – as well as great, low interest rates – it takes about 30 days to close and first-time buyers must have a signed purchase agreement on or before April 30, 2010. In those cases where a contract is signed by April 30, 2010, the purchase must be completed no later than June 30, 2010. 

For more information on the tax credit, visit: www.federalhousingtaxcredit.com.

Posted by:Deborah Byrne

My last post illustrated the tried and true reasons to buy real estate now. For the most part, all of those reasons were norms we’ve always known about real estate.  But today, there are different reasons to act now.  There’s a timer on some of the following reasons – some of these will disappear soon, as soon as April 30, 2010!  So tick tock.

Here we go, 5 more reasons (in no particular order) to buy real estate today:

• Home Buyer Tax Credits  -You’ve heard lots about this, but it is a good reason to get on the bandwagon and buy a home.  The tax credit applies to purchases that occur before April 30, 2010, or where a binding contract is signed before that date and the transaction is completed by June 30, 2010.  Currently, the government is offering two programs.  An $8,000 First-Time Home Buyer Tax Credit and a $6500 Move up/Repeat home Buyer Tax Credit  –  quick overview. More FAQ’s about the Home Buyer Tax Credits can be found here.


• The Energy Efficiency Tax Credits- FEDERAL—The Existing Home Retrofit Tax Credit, Tax Code Section 25C is available to homeowners and credits 30% of the cost up to a $1,500 lifetime limit are available for projects completed in 2010. 


• Local and regional funding is available for Energy Efficiency programs LOCAL– Sonoma County’s Energy Independence Program is a new opportunity for property owners to finance energy efficiency, water efficiency and renewable energy improvements through a voluntary assessment. These assessments will be attached to the property, not the owner and will be paid back through the property tax system over time, making the program not only energy efficient but also affordable.  I’ll bet there are lots of ways for you to capitalize on energy credits while you live in your home.  If you are still renting, it’s time.  Buy a home, get tax credits!  Check out what is available to you with a quick Google search.


• Time’s A Wastin’—Act Now.  Foreclosures, Short Sales, just ‘get me out of this house now’ sales. There are so many reasons prices are low.   The market seems to be correcting, so don’t wait.  Get approved for a loan, find a great realtor, and start shopping!  There’s tons of information out there.  Get someone to help you or just help yourself.  Go on, do it. Time’s a wastin’!


• Control over your environment– Owning your home offers other advantages as well. Not only can you change your home to meet your needs, but you also are not subject to the terms of a lease or a landlord’s whims. As a homeowner, you can experience the emotional and financial security that comes from knowing  what your housing expenses will be from year to year for the most part.  Unlike rents, which can increase annually, most mortgages have fixed or capped monthly payments. So, as a homeowner, you can have a much better idea of what proportion of your paycheck goes toward your home. Think of it as the ultimate savings plan. If you are still trying to decide if you want to rent or buy, this calculator, designed by Michael Bluejay may be the best tool I’ve found for that.  Have fun.

So there you have it.  My Top Ten For 2010.  Top Ten Reasons to Buy Real Estate Now.  Comments are welcome as always.  Email me at mohayer@fhallen.com. 

Posted by:Martha O’Hayer

Previous posts have centered on “how-to’s” for sellers. Well, buyers have just as many rules! For most buyers, the first step is to get pre-approved for a mortgage. It is imperative to know just how much home you can buy, and exactly what your monthly payment will be, before you start your home search. My “no-surprises” mantra applies to buyers as well as sellers.

When applying for a mortgage loan, there are definite do’s and don’ts to keep in mind. In general, you don’t want to make any changes to your financial picture until after you’ve moved into your new home.

Here are ten rules to keep in mind while navigating the process:

1. Do not change jobs, become self-employed or quit your job.
2. Do not buy a car, truck or other large purchase that requires monthly payments.
3. Do not use credit cards excessively or let your payments fall behind.
4. Do not spend money that you have set aside for closing costs or down payments.
5. If refinancing, do not stop making your current mortgage payments.
6. Do not originate any new inquiries into your credit.
7. Do not make large deposits to your checking or savings accounts without first checking with your loan officer.
8. Do not change bank accounts.
9. Do not co-sign a loan for anyone.
10. DO make sure the loan application is completed fully and accurately, and provide your loan officer with any requested information promptly.

Each of these rules has been violated by a borrower at one time or another, resulting in delays or outright denial of the loan. Don’t let this happen to you. And if you are looking for a reputable lender, contact me at 707.537.2308 or dbyrne@fhallen.com and I’ll provide you with the names of some good ones.

Posted by:Deborah Byrne

Traditionally, fall brings about a change in activity in the real estate market since many homebuyers plan their transactions around the school year. With school in session, sales can tend to slow. Additionally, many sellers take their homes off the market for the holidays and wait for the more favorable spring selling climate. Pair the cyclical trend with reduced consumer spending, an increasing unemployment rate and decreasing cash flow, and this would appear to be an unfavorable time to list your home.

However, we’ve seen from experience that if priced right from the start, some homes do sell in a short time frame, no matter the season. Indeed, there are buyers out there who recognize that now is a great time to purchase a home. Fueled by low mortgage rates and government incentives, savvy buyers are looking to make a purchase. Case in point: The Duran Group’s listing at 3650 Rutherford Way in Santa Rosa. Priced at $789,900, this five bedroom, three bath home with over 3,356 sq. ft and built in 2000 drew five offers and went into contract after only nine days on the market.

Plagued by the economic crisis, the spending and saving habits of Americans are being looked at now more than ever as indicators of economic recovery.

However, maybe this is a more accurate sign of what’s to come.

Are you interested in buying in this off-peak season? Click here for some tips.

Posted by:Raina Duran

Are you considering buying a new home and wondering why the selection is dwindling? Have you noticed that there are very few new home communities currently under construction? In order to compete in the current market, builders have been forced to reduce the price of new homes so much that they barely cover the cost of materials and labor. Because of this, new home construction has virtually come to a halt and builders are focusing their efforts on liquidating their current inventory.

Now is a great time for qualified buyers to take advantage of the tremendous opportunities that exist. You can now purchase a new home for the same price as a “used” resale home (as long as inventories last). Don’t hesitate because once inventories are sold out, it will take time before construction will begin again on any new home communities and prices will likely be higher. Until builders can make a profit by selling homes for more than they cost to build, new home communities will remain on hold. It could take years for new home construction to get back on track.

The availability of long term financing at historically low levels coupled with builder “close out specials” means great opportunities for buyers in today’s real estate market. Don’t miss the opportunity to benefit from our current real estate marketplace.

Get pre-qualified with a respected and knowledgeable lender, find yourself a real estate agent who understands the market and… happy hunting! The fruits of your labor could be the home of your dreams.

Posted by:John Duran

The real estate industry is full if clichés and metaphors, for example: “location, location, location” — “a wave of foreclosures is about to hit the market” — “are we at the bottom of the market?” — “interest rates are the lowest they’ve been since the Macedonian Period!” These clichés and metaphors are spewed out more frequently than the phrase “Bailout” flashes across the ticker on Fox News, MSNBC and other media conglomerates who attempt to shape our economic thought process and buying habits. The million dollar question: “Is this the right time to buy real estate?” Although we can’t look into the future and give an accurate answer to that question, we can look at history and trends.

According to Kiplinger’s Personal Finance,

“It’s a good time to snag a bargain if you’re confident in your job prospects and you don’t plan to sell for at least five years.”

Over the past decade, real estate lost its way — real estate was typically purchased to have a place to call “home” and raise a family or create lifelong memories. However, when real estate rose faster than a kindergartener’s hand when asked by their teacher “who wants a cookie?” real estate became a commodity and the American Dream of owning a home changed overnight to an appreciation feeding frenzy. Consumers thought it was their right to gain 20 percent appreciation year after year until they were ready to sell and retire from the proceeds or refinance with a less risky loan and take cash out for exotic vacations, vehicle and boat purchases, or trips to the local home improvement store where homes were transformed from an outdated and sometimes unlivable dwellings to the neighborhood Taj Mahal. With all of that aside, it does seem like now is a good time to buy real estate. In fact, according to Forbes.com, the number one item on their list of things to buy before the economy improves is housing.

“This may be the best time in a generation to buy a home.”

The Pew research center reported that 75 percent of Americans said it was a “good” or “very good” time to buy (people-press.org). The Wall Street Journal reported that median home prices in the San Francisco Bay Area are up 9.2 percent year-to-date and MSN Money.com/Case Shiller posted the following statistics regarding return on investment from January 1, 2001 through December 31, 2008: The Dow Jones down 19.8 percent, the S&P down 35.2 percent, the Nasdaq down 59.9 percent, and Real Estate up 69.8 percent. I am often told by consumers that they’re waiting for the market to go down even more before they decide to buy. However, keep in mind that if homes decrease another 10 percent you’ll save $50,000 on a $500,000 purchase, but if interest rates increase by more than 1 percent it will offset the $50,000 you saved on your purchase price and your monthly cost will increase. USA Today is currently estimating that California’s excess supply of homes will be substantially depleted and new construction will be needed to meet demand, thus leading to a housing recovery. Over the past six years, 30-year mortgage interest rates have hit historical lows on five different occasions, followed by quick and dramatic increase in rates as reported by the Federal Reserve. Again, one cannot predict the future, but with data and statistics one can be informed and make an educated decision and our market place (especially homes priced under $400,000) is very competitive. Buyers in this price range are often bidding against multiple offers, homes are selling for above asking price, and inventory is very low — all creating a demand for a supply that has decreased dramatically. It is a good time to buy, so contact a real estate professional, get pre-qualified with a loan officer and let the shopping begin!

Posted By: Doug Hecker

Realize that dream here in beautiful Sonoma County Wine Country. Because of the down turn in the Real Estate market, those types of properties are more affordable now than they have been for a long time. You could find a property with a vineyard that’s just large enough for you to enjoy the fruits of your labor, and comes complete with a stunning home attached.

If owning a Wine Country home with a hobby vineyard is your dream, check out my listing at www.3930HansfordCt.com. It has over 300 Petite Syrah vines, and a hill of lavender for a “Touch of Provence”. Contact me for a private showing.

Posted by:Beth Urban-Purtell

If you’re a first time home buyer or someone who has been thinking “when am I ever going to be able to buy a home?” Well, the time is NOW!

There is currently a perfect storm of opportunity in the convergence of available inventory of the lowest priced properties in a decade (many bank owned) coupled with historically low interest rates. The proof is in the fact that many homes which once sold for more than $500,000 are now selling for $350,000 or less. This opportunity has stimulated multiple offers and some homes are actually selling for more than list price.

Even though there is still a great deal of fear in the market place, I believe the bottom has set in and smart money is moving back into the market to take advantage of the incredible values that can be realized. So if you’ve been on the sidelines waiting for a sign, this is it. Those who wait until next spring when they think things will be better may miss out because things probably will be better and that means today’s pricing and interest rates will no longer be available. Those who wait may find their buying power has actually been diminished instead of improved.

Questions, contact Raina at (707) 537-2319 or rduran@fhallen.com and check out our website at durangrouprealty.com.

Posted By: Raina Duran

Gobble, gobble, and gobble! No, it’s not Thanksgiving, but it is the sounds of my neighborhood. Shortly after moving into our home, my husband and I one morning were awakened abruptly from a deep sleep about 4 AM. In unison, my husband and I exclaimed, “What is making that racket?” Our curiosity must have been similar to how the father in the” Night before Christmas” felt when he heard the strange sounds on the roof top of his house. In our case, we felt an immediate investigation was necessary to determine what was happening and trying to find out if we had inherited a family of ghosts.

After checking inside the house for the nature of the sounds, we went to the window and pulled up the blind to find out if the noise was coming from outside. It was dark outside, as it was early morning and after allowing our eyes to adjust for a few minutes, we noticed some movement under a large oak tree about 50 yards away. It took us both a few minutes to determine if the mass under the tree was man or beast, but then we realized it was a large gathering of wild turkeys! There must have been at least 30 of these gobblers crooning up a storm under that large oak tree.

My husband and I were amazed and a bit astounded by the huge flock of feathered friends who had decided 4AM was a great time to have a hoe down and wake up the neighborhood. We also began to realize that most mornings our alarm clock would consist of our feathered friends starting their day with this kind of “happening” and if we were going to live in the neighborhood, we would need to adjust.

After living in a city environment for a number of years, we were delighted to have such noisy neighbors! Both of us agreed we had chosen Sonoma County for this very reason.

We were looking for a slower pace of life, wanted to enjoy more of nature, grow a garden and sample good wines. Sonoma County has an abundance of these offerings and was high on our list of places to live. We made the move and haven’t looked back since.

If you are considering a move to Sonoma County, come and visit. See what we have to offer and look at the various areas to live. If you’re considering buying a home or condominium, interest rates are at an all time low and prices are even better. Feel free to contact me at 707.537.2308 or you can reach me by email at rbuzzard@fhallen.com.

And who knows, you could end up in a great house with interesting neighbors too!

Posted By: Ruth Buzzard

Last Friday morning I heard one of my dogs barking and I looked outside to see a medium-size brown dog in front of my house. I opened the door and he came running up to greet me, very excited. I grabbed a lead, and slipped it around his neck. He didn’t have tags or a collar, but he looked well cared for. I knew someone had to be missing this adorable dog.

I walked him around the neighborhood to see if anyone recognized him. We have a large dog population here, and their humans walk them regularly. No one had seen him before. I took him to the local vet to see if he had a chip, but he did not. We kept him out front on a long chain during the day just in case someone was driving around looking for him. We placed flyers around the neighborhood, put him on Craig’s List, filed a “found dog” report with the Sonoma County Animal Control, and put an ad in the newspaper with no results. I quickly named him Brownie, so we had something to call him. I know – no imagination.

We have two old dogs, and thought that adding this spunky 2 year old to our household might not be a good thing, so I took him to a friend’s home for a sleep over with her dog. She had been looking for a companion for her dog, and it sounded perfect. As soon as I drove away from her house I knew I had made a big mistake. I cried for hours and didn’t sleep much that night. I called the next day and asked if Brownie could come home. My husband picked up our dog friend. We found out that he’s an Australian Cattle Dog, and my husband named him Joey. He hops like a Kangaroo when we approach him, and Joey is Australian slang for little Kangaroo. Note, my husband picked him up and named him.

Are you thinking what does any of this have to do with Real Estate? Have you ever looked at a home and knew in your heart that it was the right one for you, but were afraid to make a commitment? Did you drive away, have the feeling that you were making a big mistake, and just keep driving only to find out that it went into escrow the next day and realize that you should have followed your heart and made an offer on it the day before?

In this current Real Estate market there are amazing “deals” to be found, especially in the upper-tier market. Don’t be afraid to make the commitment to purchase the home that tugs at your heartstrings. If you don’t, you might find that you’ve just passed by an opportunity to purchase a home that you’ll say “we should have” for years.

Posted By: Beth Urban-Purtell