Housing Industry to Drag Until 2009?

Southern California's overall economic picture going forward looks generally positive, but the housing market is expected to limp through 2008 with only modest recovery expected by 2009, according to the mid-year economic forecast by the Los Angeles County Economic Development Corporation (LAEDC). The LAEDC is predicting a 1.4 percent spike in the number of non-farming jobs across the region through 2008, with support from the tech, health services, and leisure and hospitality industries, bolstered by steady growth in international trade.

For the housing industry, the picture isn't quite as upbeat.

"A frequently asked question is when the housing industry will turn around," said LAEDC Chief Economist Jack Kyser. "We are a tad bearish, forecasting a distressing 33.7 percent decline in the number of new housing permits in the five-county area in 2007 and a 6.8 percent slide in 2008." Continued weakness in the industry, said Kyser, will hold through late 2008, with only "restrained" recovery expected. "Don't look for a return to double digit gains in prices," he said.

Tahquitz Peak

Another beautiful day in Southern California, and a great day for a hike! I hadn't been on a strenuous hike in awhile, so off I went to Tahquitz Peak in the San Jacinto Mountains, 2 hours from San Diego. The South Ridge trailhead is at 6480 feet, and the peak is at 8846 feet. Strenuous indeed!

Tahquitz is pronounced "Tah-quish", according to the local Cahuilla ("Ka-wee-ah") Indian tribe. There is a legend of Tahquitz that involves beautiful Indian maidens gone missing, but I won't get into that here.

About a mile and a half up, there is a favorite photo spot called "the keyhole".

From the half-way point, you can see the high country (and how far you still have to go!).

This is a view of the South Ridge with Garner Valley and Thomas Mountain beyond. The hazy mountain range in the distance is Palomar Mountain in San Diego County.

We don't have 14,000 foot peaks like Colorado does, but we have a few 10,000s. This photo was taken from Tahquitz Peak, and from there you can see Marian Mtn, (10,362), Newton Drury Peak (10,160), Mt. San Jacinto (10,804) and Jean Peak (10,670) right in front of San Jacinto. The green area below is Wellman Cienega. Cienega means "swampy place" and you can see Wellman is still green even though we didn't get much rain this year.


The hike took 3 hours up and 2 hours back. I'm sure sore, but I'm glad I had the chance to see the beautiful San Jacinto Moutains again.

NAR Forecast: Home Sales, Prices to Pick Up in 2008

WASHINGTON, July 11, 2007 - Home prices are expected to recover in 2008 with existing-home sales picking up late this year and new-home sales rising early next year, according to the latest forecast by the National Association of Realtors®.

Lawrence Yun, NAR senior economist, said a good buyers’ market has evolved. “Buyers now have an overwhelming advantage given the wide selection of homes available in many markets,” he said. “But with profit margins coming under pressure, homebuilders will limit new construction well into 2008. This should help the overall inventory level to move steadily into a more balanced state.”

Existing-home sales are expected to total 6.11 million this year and 6.37 million in 2008, down from 6.48 million last year. New-home sales are projected at 865,000 in 2007 and 878,000 next year, compared with 1.05 million in 2006. Housing starts, including multifamily units, are forecast at 1.43 million units this year and 1.44 million in 2008, down from 1.80 million last year.

Existing-home prices are likely to rise 1.8 percent to a median of $222,700 in 2008 after a 1.4 percent decline this year to $218,800. The median new-home price should rise 2.2 percent to $245,400 next year following a 2.6 percent drop in 2007 to $240,100.

“Markets that sharply reduce new construction in 2007 will generally experience respectable price increases in 2008,” Yun said. “Local conditions vary considerably, but with historically low mortgage interest rates this summer and sustained job gains, it could be a good time for first-time buyers with a long-term view to test the housing waters.”

Call 800-469-6391

Man, have you noticed how radio commercials are going over the top by repeating the phone number over and over? It used to be they repeated the number twice, then three times, then four, and now some commercials say the number FIVE times! There must be some study someplace that says the more you repeat the number, the better the ad pulls. I tell you, it sure backfires on me. I soon as I start to hear "call one eight hundred four six nine six three nine one, that's one eight hundred...", off goes the radio. Some are even like rapid gun fire in my ears - "call 8-8-8 .... 8-8-8 ... 8-8-8".

Is this really supposed to make me call them more than if they just said the number once? I mean, why not just have an ad like "by your dream home now, call 800-469-6391..." and just repeat the number for as long as the commercial lasts? If two is good, and five is better, why not twenty?

Maybe it's just me, I don't know. Does this kind of repetition really work? If it works for you, then give me call at 800-four six nine, six three nine one, that's 800-469-6391. Did you know that my number spells out 800-four MY NEW one? Call now, 800-469-6391, that's 800-469-6391.

C.A.R. forecasts 14% sales decline, modest increase in median home price for state

The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) projected a 14 percent decline in single-family home sales this year, and forecast a 1.8 percent increase in the median price of a home. C.A.R. Executive Vice President Joel Singer delivered the Association’s 2007 Midyear Housing Market Forecast as part of the California REALTOR® Showcase in Sacramento.

Sales are expected to fall to 410,500 units in 2007, a 14 percent decline from the 477,460 pace recorded in 2006, according to the forecast. The median price of a home will reach $566,500 this year, a 1.8 percent increase from the $556,640 median for 2006.

“Sales have declined in all areas of the state, but higher-end markets have experienced somewhat smaller declines,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Sales are weakest in areas that had a lot of new home building in recent years or those areas that had been popular for second home purchases.

“Prices tend to be softer in those areas as well,” she said. “This pattern is likely to continue throughout the rest of the year, particularly in areas that were popular among first-time home buyers, which experienced the greatest run-up in prices. Similarly, higher-end markets have seen greater price stability, with the median price of a home declining slightly, if at all. The sales mix, with slower sales in the entry and lower-end of the market and relatively stronger sales in the high end, has helped stabilize the median price.”

According to the C.A.R. forecast, the Central Valley region has experienced a greater decline in sales compared with the state as a whole, and a succession of year-to-year declines in the median price. This trend is likely to continue, due in part to excess inventory of new homes for sale.

The San Francisco Bay Area and moderately priced to higher-priced areas of Southern California have seen a somewhat better sales picture, with small or nonexistent median price declines. These areas should continue to fare better than lower-priced inland markets in the San Bernardino and Riverside areas, according to Appleton-Young. Sales in those areas remain significantly below the record levels of the peak years, she said.

Improving Your FICO Score

It’s important to note that raising your score is a bit like losing weight: It takes time and there is no quick fix. In fact, quick-fix efforts can backfire. The best advice is to manage credit responsibly over time.

Payment History Tips
· Pay your bills on time. Delinquent payments and collections can have a major negative impact on your score.
· If you have missed payments, get current and stay current. The longer you pay your bills on time, the better your score.
· Be aware that paying off a collection account will not remove it from your credit report. It will stay on your report for seven years.
· If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor. This won't improve your score immediately, but if you can begin to manage your credit and pay on time, your score will get better over time.

Amounts Owed Tips
· Keep balances low on credit cards and other “revolving credit”. High outstanding debt can affect a score.
· Pay off debt rather than moving it around. The most effective way to improve your score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.
· Don't close unused credit cards as a short-term strategy to raise your score.
· Don't open a number of new credit cards that you don't need, just to increase your available credit. This approach could backfire and actually lower score.

Length of Credit History Tips
· If you have been managing credit for a short time, don't open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you don't have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.

New Credit Tips
· Do your rate shopping for a given loan within a focused period of time. FICO® scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur.
· Re-establish your credit history if you have had problems. Opening new accounts responsibly and paying them off on time will raise your score in the long term.
· Note that it's OK to request and check your own credit report. This won't affect your score, as long as you order your credit report directly from the credit reporting agency or through an organization authorized to provide credit reports to consumers.

Types of Credit Use Tips
· Apply for and open new credit accounts only as needed. Don't open accounts just to have a better credit mix - it probably won't raise your score.
· Have credit cards - but manage them responsibly. In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.
· Note that closing an account doesn't make it go away. A closed account will still show up on your credit report, and may be considered by the score.