16. Economy Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it. Ronald Reagan American President
19. US Deficit Highest in Decades2010: 11% of GDP (Revenues – Expenses) Source: US Treasury, BEA, compiled by C.A.R.
20. US Debt Jumped as Government Responded to Financial Crisis 2010: 93% of GDP Source: US Treasury, BEA, compiled by C.A.R.
21. Components of GDP:Consumer Spending Weak; Gov’t Sector Down Quarterly Percent Change US Dept of Commerce, Bureau of Economic Analysis
22. Consumers Pulling BackHome Equity & Reverse Wealth Effect Consumer Spending 2011 Q1: 2.7% Q2: 0.4% Quarterly Percent Change QUARTERLY PERCENT CHANGE US Dept of Commerce Bureau of Economic Analysis
23. Unemployment Stubbornly High September 2011 California (12.1%) vs. United States (9.1%) CA Employment Development Division
24. U.S. Job Growth: Flat in August – 103,000 jobs in September Recession Job Losses: 8.4 million Since Jan’10: +1.8 million US Dept of Labor, Bureau of Labor Statistics
25. Total Payroll Jobs in the U.S. (same as in 2000, but with 30 million more people)
27. California Job Growth: Faltering Month-to-Month Changes Recession Job Losses: 1.3 million Since Jan’10: +188,100 CA Employment Development Division
28. Where are California’s Jobs? Employment Trends: Construction & Financial Biggest Losers California Association of REALTORS®
29.
30. In 2010 we saw an average of 3.9 events per week.
32. Our rate today is more than 5 times what it was then.No one knows the real level of activity because smaller companies are not required to file layoff notices with the state. A conservative estimate is that only 1 out of 5 company departures becomes public knowledge, which means California may suffer more than 1,000 disinvestment events this year. The capital directed to out-of-state or out-of-country, while difficult to calculate, is nonetheless in the billions of dollars. The top five destinations are (1) Texas, (2) Arizona, (3) Colorado, (4) Nevada and Utah tied; and (5) Virginia and North Carolina tied. Joseph Vranich Business Relocation Coach
33. Crisis of Confidence: Small Business Optimism Down National Federation of Independent Business
38. California Sales of Existing Homes and Median Price Housing Cycle Comparisons 1970- 2011 -44% UNITS/MEDIAN PRICE $ -25% -61% California Association of REALTORS®
60. “House Prices, Home Equity-Based Borrowing, and the U.S. Household Leverage Crisis” by Mian and Sufi: American Economic Review :39% of new defaults from 2006 to 2008 attributable to home equity borrowing
61. California Foreclosure FilingsAugust 2011 NTS: 24,260, -16.9% YTD • NOD: 32,338, -21.5% YTD 6 Month Average: NTSs: 23,806 NODs: 23,625 California Association of REALTORS®
62. 1 in 3 Sellers Sold Because They Were in Distress California Association of REALTORS®
63. Sellers with a Net Cash Loss Long Run Average = 11.2% What was the net cash gain or net loss to the seller as a result of this sale? California Association of REALTORS®
64. Net Cash to Sellers Q. What was the net cash gain or net loss to the seller as a result of this sale? California Association of REALTORS®
65. Proportion of Sellers Planning to Repurchase Q. Is the seller planning on purchasing another home? California Association of REALTORS®
69. CA New Housing Permits Average 1988-09: 138,000 2009: 36,200 2010: 39,000 SOURCE: CBIA. Forecast: C.A. R. California Association of REALTORS®
70. Direction of Home Prices: Sellers Skeptical; Buyers Hopeful California Association of REALTORS®
71. It’s Time To Buy Again “Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.” SOURCE: “Real estate: It’s time to buy again” Fortune Magazine’s 3/28/11 article written by Shawn Tully
72. Politics If you want to understand your government, don't begin by reading the Constitution. Instead, read selected portions of the Washington telephone directory containing listings for all the organizations with titles beginning with the word National. George Will Journalist & Author
73. “Just because you don’t take an interest in politics doesn’t mean politics won’t take an interest in you.” Pericles: 500 B.C. If you don’t have a seat at the table… You’ll probably be on the menu. Wunderlich Codicil: 2000 A.D.
77. The Realtor®Party NAR: The largest grassroots Political Action Group in this country. "These groups are powers in Washington. The National Association of Realtors gave more money than any other group to candidates in the last election ($4+ million). Its 1.1 million members can do a lot of lobbying." CAR: The most effective business advocacy group in Sacramento.
82. Challenges at the Local Level Man, I know Anaheim is facing a $4 Trillion deficit, but they really need to do something about all these panhandlers!
83.
84. 1,500 MAY have some real estate relevance
85. 1,000 may get passed – 600+ during the last week
86. CAR has to read each bill,
87. Decide if we want to take action on it,
88. Monitor it all the way through until it’s passed, is defeated or dies.
98. Estate Tax Reform:NAR supports repeal of the estate tax but opposes the portion of the repeal that requires the use of so-called “carryover basis.” If the estate tax were to be revised, NAR supports the lowest possible rate (but in no event a rate higher than the maximum individual tax rates) and a substantial exclusion.
99.
100. Mortgage Loan Limits:The mortgage loan limits for the GSEs (Freddie Mac and Fannie Mae) and for FHA are critical to providing liquidity in today's housing market. Especially as the private market has yet to return, these programs are vital to our housing recovery. The current GSE limits range from $417,000 to $729,750, depending on local area median home price. The FHA limits range from $271,050 to $729, 750, also based on 125% of local area median home price. Both of these limits are set to expire on September 30, 2011 and will reset to 115% of local area median up to $625,500. Call to Action to Make FHA, Fannie & Freddie Loan Limits Permanent
101. Federal Housing Administration Programs:NAR is a strong supporter of the single- and multi-family programs administered by the Federal Housing Administration (FHA).
102. NAR Credit Policy/QRM:NAR has forged the broad-based Coalition for Sensible Housing Policy, which includes 44 organizations focused on drawing attention to the proposed regulation’s onerous 20 percent down payment requirement. The coalition asked for and recently received an extension of the comment period until August 1, 2011. NAR and its coalition partners have also gathered the support of 44 U.S. Senators, who recently wrote to regulators expressing their intent on QRM and opposing the imposition of a sizable down payment; 282 House members signed a similar letter.Call to Action on the Qualified Residential Mortgage
106. NAR Supports: Improving energy efficiency through voluntary incentives in lieu of individual building mandates. Commercially reasonable approaches that advance market and smart-growth principles of protecting private property rights and maintaining real estate affordability and availability. Additionally, NAR supports educating property owners and consumers about the benefits of energy efficiency.
113. Top 20 metros for mortgage fraud 1. San Jose-Sunnyvale-Santa Clara, Calif. 2. San Francisco-Oakland-Fremont, Calif. 3. Los Angeles-Long Beach-Santa Ana, Calif. 4. Riverside-San Bernardino-Ontario, Calif. 5. Sacramento-Arden-Arcade-Roseville, Calif. 6. Miami-Fort Lauderdale-Pompano Beach, Fla. 7. San Diego-Carlsbad-San Marcos, Calif. 8. Las Vegas-Paradise, Nev. 9. Atlanta-Sandy Springs-Marietta, Ga. 10. Salt Lake City, Utah 11. Chicago-Naperville-Joliet, Ill. 12. Washington, D.C.-Arlington-Alexandria, Va.-Md.-W.Va. 13. Tampa-St. Petersburg-Clearwater, Fla. 14. New York-Northern N.J.-Long Island, N.Y.-N.J.-Pa. 15. Orlando-Kissimmee, Fla. 16. St. Louis, Mo.-Ill. 17. Seattle-Tacoma-Bellevue, Wash. 18. Phoenix-Mesa-Scottsdale, Ariz. 19. Richmond, Va. 20. Denver-Aurora-Broomfield, Colo.
114. What is Fraud? Fraudcan be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage“. The snake oil peddler and confidence man of Old West fame are alive & well today. In the broadest sense, a Fraudis an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by jurisdiction. Fraudis a crime, and also a civil law violation. Short Sales Fraud is a term loosely used to describe fraud, deceit or trickery in a short sale transaction. It is currently among the most pervasive and fast-growing practices of real estate fraud replacing mortgage fraud, reverse mortgage fraud & loan modification fraud.
115.
116. On the state level, the Department of Real Estate (DRE) has reportedly revoked, suspended, or accepted the surrender of 886 real estate licenses from July 2009 to June 2010, which is a 60 percent jump over the preceding three years.
117. As of August 2010, the DRE reportedly had about 5,400 open investigations, including more than 100 scams involving short sales. Since 2006, the DRE has issued about 600 desist and refrain orders to unlicensed people.
118. Our new District Attorney has indicated a definite interest in taking a much more proactive role than his predecessor.
125. With full disclosure, among other things, a short sale flip is not necessarily illegal. However, in practice, scam artists often use various illegal and improper tactics to close these types of transactions. These schemes typically involve attempting to dupe Seller A’s short sale lender into believing a property is worth less than it is, and yet, simultaneously selling the property for a higher price and pocketing the difference. The scammers use the time waiting for the short sale approval to look for a new Buyer C to buy from Buyer B at the higher price.
126. At times, Seller A, Buyer B, and Buyer C, among others, are aware of the property flip but the scammers convince them that the plan is legal, or give them money for their cooperation. Buyer B, in particular, could be, among other things, a trust, a limited liability company (LLC), or a straw buyer, who could be in cahoots or a victim of identity theft. Source: CAR Legal
127. Your most obvious Red Flags Up-front fees/improper payments Unlicensed Negotiators Transfer through Trust Transfer deed to 3rd party LLC’s No disclosure to lender Concurrent escrow Same agent representing both * Disclaimer:
128. Wholesale, Rampant FraudImpacts the Economy A few million here, a few billion there, Bernie Madoff Robo-signing Countrywide Sub-Prime An industry out of work