Sonoma Housing Bubble

Pulling the cork out of Sonoma's bubbly housing foolishness

Monday, May 14, 2007

The Downside of The Real Estate Bust...West Nile Virus and Yellow Fever???

They're not exactly building the Panama Canal up in Sacramento but they seem to be facing the same sort of problems. All that stagnant water and warm tempertures.
Where's Dr. Walter Reed when you need him? Instead they're caling in Realtors to help? Ok, I exaggerate. So it's not the Tiger Mosquito, it's the Culex, but they both carry disease.

Thousands of unsold and empty houses in the Sacramento region are fast becoming breeding grounds for mosquitoes.

As the region's housing slump creates more vacant houses and a growing excess of homes in transition between buyers and sellers, Culex mosquitoes that can spread the West Nile virus to birds, other animals and humans are thriving in uncared-for swimming pools, garden ponds and yards flooded by broken sprinklers, said David Brown, manager of the Sacramento-Yolo Mosquito and Vector Control District.

"A 5-gallon bucket can literally produce a thousand mosquitoes a week," Brown said. "Multiply that by the surface of a pool and you see how many mosquitoes can affect an entire neighborhood. These mosquitoes can fly one to five miles."

Sacramento Association of Realtors spokesman Greg Vlasek said there are 9,672 houses for sale in the mosquito district's Sacramento and Yolo counties coverage area alone.

Nearly 1,400 have swimming pools.

Ah, all those empty flipper palaces with their "water features" in the backyard, and large pools and hotubs, at least someone's calling them home, though vermin was not exactly when the RE investors had in mind. Just recently it was possible for anyone with a pulse to get some sort of bloated jumbo no money down suicide loan, why not someone with six legs and a long beak?

Mosquito control officials say late spring rainfall followed by high temperatures yielded an ideal combination for mosquito breeding.

Their aim now is to find and treat as many uncared-for pools as possible with larvicides and fish that eat mosquito larvae.

"Every time a female mosquito lays her eggs, it's 100 to 300 at a time," said Sacramento-Yolo technician Lisa Fitzgerald, spraying larvicide into a filthy green pool at a vacant house in Carmichael on Friday.

"She also puts a scent on the water that says, 'This is a perfect place to come lay your eggs.' "

Fitzgerald didn't know the status of the house along busy Fair Oaks Boulevard.

But it was like more and more houses she sees now -- home to a murky backyard pool that eventually prompted complaints from neighbors.

"There's a lot of houses for sale where the pool isn't being maintained," she said.

"I was at a pool at just a beautiful house. The backyard was just beautiful. Then there was the pool. It was in foreclosure."

Fitzgerald finished spraying, then dumped in a dozen minnow-sized fish to eat larvae that grow into adults in seven to 10 days.

"They'll maintain it until it's drained," she said.

Yeah, kind of like the original owners did.

As real estate agents add mosquito patrol to their duties, there are more than 14,000 homes for sale in El Dorado, Placer, Sacramento and Yolo counties. Most are on the market two months or longer, according to Sacramento-based researcher TrendGraphix.

The bad news is that things are not going to get better anytime soon as the number of short sales and foreclosures grows.

Short-sale spikes have happened before in real estate, most recently in the early 1990s when housing prices in California dropped steeply as interest rates rose and jobs were cut in the defense industry.
What's unusual about the current round of increases, observers say, is that many short sales are tied to the easy-money loans of a few years ago; this time there has not been a wave of job losses or steep drop in property values.
In early May 2006, there were hardly any short-sale listings in Fremont, Hayward, Newark and Union City, said Steve Dhillon, a Realtor with RE Realty Experts in Fremont.
One year later, almost 8 percent of homes on the market in Fremont were listed as short sales, according to data from the multiple-listing service used by Realtors. In Union City, 15 percent of listings were short sales, followed by 10 percent in Hayward and 7 percent in Newark.

All that property going to seed and no one able to qualify to take it off the banks hands.
In recent months, lenders have tightened up standards for 100 percent financing loans in response to the fallout from the subprime mortgage crisis, which has seen increasing foreclosure rates as borrowers fall behind with their mortgage payments.
The tightening of loan underwriting standards for these loans could lead to even more short sales since it will make it harder for borrowers to refinance into a new loan, said Konesky, the Tracy-based Realtor.
"I'm sure (short sales) are going to continue to grow through this year. If you own a house and have no equity, you know you need 100 percent financing again," he said.
Dhillon, the Fremont-based Realtor, doesn't see a slowing of short sales, either.
"As we progress more into the year, the number of short sales should increase, brought on by the upheaval in the subprime market," Dhillon said. "Also, lenders will start to tighten credit requirements, and adjustable mortgages will be resetting to higher rates."

It's going to be harder and harder to fiind a sucker, (not the winged kind) able to occupy one of these places. So the next time you see your local realtor look for the man/woman carrying minnows. In the near future "staging" might require enveloping the entire structure in mosquito netting.


At 5/14/2007 05:53:00 PM , Anonymous Anonymous said...

wow...interesting, read about Casey Serin creating a similar public heath threat in Modesto that was so bad it showed up on Google Earth, but had no idea this is now becoming a common problem in Sacramento

At 5/14/2007 07:28:00 PM , Anonymous tom stone said...

All this from the first wave of 2/28 resets.and the BIG wave started this month.and Alt-A is looking a lot like "subprime" did in late january.there is good news though,REO's are listing at about 30% less than comparable fsbo in san diego and sac (same area,same cookie cutter pos mcmansion)so they will be reasonably priced in a year or two.God i hate 'skeeters,got a nasty disease from one once.don't forget the other health problems related to stress either,booze and dope,more suicides,divorces,battery.ugly stuff,but hey the economy is fine,just fine.

At 5/18/2007 02:10:00 PM , Anonymous Anonymous said...

...but hey the economy is fine,just fine.

Ees Party Line, Comrade.
Just like "The Five Year Plan Has Exceeded All Quotas..."
And "The chocolate ration of twenty grams has been INCREASED to ten grams!"

At 5/18/2007 05:05:00 PM , Anonymous Anonymous said...

Read this over at Bubble Tracking. Sounds like a great bubble-leading realtor at work.
RE agent Nunez(ex-cashier) is an idiot.

CHRIS NUÑEZ: You know I usually I get clients who come in here assuming that I came from a wealthy family or I am highly educated or whatever. I usually say you know what, I'm just like you guys. I eat beans like you in the morning.

CHRIS NUÑEZ: I love this business. I meet people who think they can never own a home. And once I educate them and let them know they can, it, it's great.

Chaundra on being sheeple:
CHAUNDRA CARNES: You know, the only risk is if housing values go down. And I guess that's a risk we're willing to take. And I think a lot of other people are too. So we're not alone.



At 5/18/2007 10:49:00 PM , Blogger moonvalley said...

CHAUNDRA CARNES: You know, the only risk is if housing values go down. And I guess that's a risk we're willing to take. And I think a lot of other people are too. So we're not alone.

file that last one in the misery loves company file...saith the lemming.


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