Remodeling House

Bindweed(Convolvulus arvensis)Bindweed (Convolvulus arvensis) is a member of the morning glory family. It is a very invasive, spreading weed that can be introduced to the garden through soil and roots. Quite frankly I think bindweed is rather pretty with its small trumpet shaped white flowers with faint pink stripes. It covers wires and chain link fencing nicely but it is still considered a

Common Garden Petunia(Petunia x hybrida)Very few gardeners are unaware of the common garden petunia (petunia x hybrida) with their beautiful showy, cascading trumpet shaped flowers. These plants are members of the family Solanaceae (nightshade plant) that originated in South America and are thought to be a hybridization between P. axillaris and P. integrifolia. There is a wide variety of

Zillow measures homeowners' perception gap

Just like with most of life's unpleasant realities, the majority of Americans think the nation's housing crisis is something that happens to the other guy.
That's according to a survey of more than 1,300 homeowners conducted by Zillow. Two-thirds of homeowners believe their house has increased in value or remained the same in the last year. Yet, these same folks acknowledge the existence of foreclosures in their neighborhoods and believe that more are on the way.
The results even gave the Zillow people pause.
"We attribute this gap to a combination of inattention and a fair bit of denial that causes people to believe their home is insulated from the woes of the market that affect others, but not them," says Stan Humphries, Zillow's chief of data and analytics.
Zillow, of course, is the website founded by the brains behind Expedia that came on strong more than two years ago with its clever algorithms that assign a "value" to nearly every house in America. Initially, the site was a bit disappointing because, at least in many parts of Southern California, its estimates seemed wildly off the mark.
Since then, reality has caught up with Zillow, if not its homeowner-users. The company's data now appear to be in line with most other research that shows the vast majority of U.S. houses lost value in the last 12 months.
One of the more interesting findings of Zillow's latest survey shows that homeowners in the West seem to have a slightly better grip on the housing reality. More than half -- 56% -- of Western homeowners believe their home value had indeed declined in the last year, versus 38% of homeowners overall. (See the graphic above right.)
Maybe that's because homeowners here are facing a harsher reality. After years of tremendous price appreciation, the stinging face-slap of rapidly depreciating values has brought homeowners to their senses.
-- Annette Haddad
Graphic: courtesy of Zillow
Questions? Comments? Email annette.haddad@latimes.com

California's Discount Foreclosure Sales Point to Housing Bottom
By Dan Levy and Daniel Taub

July 31 (Bloomberg) -- California led the U.S. into the worst housing recession since the 1930s. Now the most populous state may be the first to find the bottom.
In Stockton, the U.S. metro area with the highest foreclosure rate, home sales more than doubled in the second quarter after prices fell by an average 37 percent, said PMZ Real Estate Corp., the area's largest broker. Across the state, sales rose for three consecutive months starting in April after 30 straight months of declines, the California Association of Realtors said. About 40 percent of those transactions were foreclosure sales, DataQuick Information Systems reported.
``California is having a wrenching decline in wealth, but this is a cathartic event that will lay the foundation for a recovery,'' said Mark Zandi, chief economist at Moody's Economy.com in West Chester, Pennsylvania, in an interview. ``This signals the beginning of the end.''
Almost $1.3 trillion of homeowner equity was lost in California since home prices peaked in December 2005, Zandi said. Discounts of as much as 50 percent will extend into 2010, helping clear a glut of foreclosures and leading to a more balanced housing market, said Ryan Ratcliff, an economist at the Anderson Forecast at the University of California in Los Angeles, and Christopher Thornberg, principal of Beacon Economics LLC in Los Angeles.
``Half off in a decent neighborhood is close to the bottom,'' said Bill Gross, co-chief investment officer of Newport Beach, California-based Pacific Investment Management Co., manager of the world's biggest bond fund. Property markdowns of 30 percent to 40 percent give the market ``price illumination if not sunshine,'' he said.
`Beginning to Happen'
California led the U.S. in default notices and bank seizures for the 18th straight month in June and had seven of the 10 metro areas with the highest foreclosure rates, according to Irvine, California-based RealtyTrac Inc., which sells default data. That drove down prices and led to ``discounted distressed sales,'' with two-thirds of transactions under $500,000, compared with 40 percent a year earlier, the California Association of Realtors said.
The amount of time it would take to deplete the supply of homes decreased to 7.7 months from 10.2 months a year earlier, and the median price fell 38 percent to $368,250 last month, according to the Realtors.
``Things are beginning to happen,'' said Karl Case, professor of economics at Wellesley College in Wellesley, Massachusetts, and co-creator of the S&P/Case-Shiller home-price index. ``We're not going to get reestablished in a stable market unless that inventory gets cleared out.''
Birth of Subprime
California led the boom in the U.S. housing market, as prices in the state more than doubled from 2000 to 2005, fueled by historically low interest rates, according to the Chicago-based National Association of Realtors.
As values soared, California gave birth to the subprime mortgage industry that specialized in lending to borrowers with poor or limited credit, who often used them to buy homes they couldn't afford, said Stephen Levy, director of the Center for the Continuing Study of the California Economy in Palo Alto.
Subprime products included ``zero-percent'' loans that needed no down payment, adjustable-rate mortgages, known as ``exploding ARMs'' because low interest rates rose after two or three years, and ``Alt-A'' or ``no-doc'' loans requiring no proof of income.
Almost half of the 25 biggest U.S. subprime lenders were based in the state, including New Century Financial Corp. in Irvine and ACC Capital Holdings in Orange, and a quarter of the country's subprime loans were issued there, more than in any other state, according to Inside Mortgage Finance and data from San Francisco-based research firm LoanPerformance.
County Breakdowns
Defaults on those loans began to accelerate in 2006, helping to push California into the lead in foreclosures.
Foreclosure sales accounted for 75 percent of June's total in Merced County, home to the Merced metro area with the country's second-highest foreclosure rate; 72 percent in Stanislaus County, home to the Modesto metro area with the third-highest foreclosure rate; and 66 percent in San Joaquin County, home to Stockton, data from DataQuick in La Jolla, California, and RealtyTrac show.
Sales of foreclosed properties equaled 63 percent of the total in Sacramento County, 62 percent in Riverside County, 58 percent in Solano County, 57 percent in San Bernardino County and 49 percent in Contra Costa County. Prices dropped as much 37 percent in those counties, DataQuick reported.
`Seen the Light'
About 1 million U.S. homes will be in some stage of foreclosure by the end of the year, and properties seized by banks will eventually sell at an average discount of 30 percent to 33 percent, said Rick Sharga, executive vice president for marketing at RealtyTrac.
Discounts will be higher in areas such as Stockton, about 80 miles east of San Francisco in California's agricultural Central Valley, and Riverside, 50 miles east of Los Angeles, that experienced above-average levels of new construction at the peak of the housing boom and where lenders made a disproportionate number of subprime loans, Sharga said.
PMZ, the Stockton-based brokerage, closed 1,707 home transactions in the second quarter, about 80 percent of them foreclosure sales, said Michael Zagaris, the company's president. Foreclosed homes are now getting multiple bids and the supply of homes for sale in San Joaquin and Stanislaus counties shrank to 4.9 months in June from 18.2 months a year earlier, he said.
``We've found the bottom,'' Zagaris said. ``The financial institutions have seen the light and are allowing the market to find its own level.''
Loan Values
Bank-owned properties attract investors who can rent out the homes for 10 percent of the purchase price annually, said Sean O'Toole, founder of real estate auction Web site ForeclosureRadar in Discovery Bay, California. ``Those deals are starting to pop up and putting a floor on the market,'' he said.
Bruce Norris, president of the Norris Group investment firm in Riverside, said he purchased foreclosed properties for one- third of the outstanding loan value during the past two months.
Norris bought a three-bedroom home in the Moreno Valley section of Riverside for $106,000, a 65 percent discount on the $300,000 loan held by Bear Stearns Cos., now part of JPMorgan Chase & Co. He got a 61 percent discount on a home with $258,750 in loans held by Deutsche Bank AG, and a 63 percent discount for a home with $324,000 in loans held by Morgan Stanley, he said.
``The banks are stuck wholesaling to people like me,'' Norris said. ``They are starting to move product faster than the market would normally allow.''
Housing Bill
Banks will foreclose on about 700,000 properties with subprime mortgages this year, more than double the number a year ago, Sharga estimated. The increase is prompting overwhelmed banks to hire more workers to process purchase offers.
Executives from Charlotte, North Carolina-based Bank of America Corp. and Wells Fargo & Co. in San Francisco told Congress last week that they've accelerated the pace of loan modifications and added personnel to help homeowners avoid foreclosure. Wells Fargo, which services one in eight U.S. mortgages, expanded its staff to more than 1,000 from 200 in 2005.
The housing bill signed by President George W. Bush yesterday is intended to stem foreclosures and includes a program backed by the Federal Housing Administration to insure as much as $300 billion in refinanced mortgages, including many subprime loans.
Housing in Stockton and Riverside sprang up during the boom as builders purchased cheap land and potential buyers sought affordable homes away from expensive coastal cities, said Levy at the Center for the Continuing Study of the California Economy.
Stockton Couple
Inland home values mirrored coastal gains until a wave of ``insane'' subprime and Alt-A mortgages started in 2005 and resulted in record defaults, Levy said.
``All of those markets suffering from higher foreclosures are where prices went too high and leverage was applied too excessively,'' Pimco's Gross said. The housing bill will ``put a floor on certain mortgages'' and help stop price declines, he said.
Homeowners like computer consultant David Imig and his wife, Deborah, who live in the Stockton area and owe more than their house is worth, aren't helped by the bill. They paid $462,000 for a three-bedroom at the market peak in 2005. Now, their neighbor's foreclosed home is on sale for half its original price.
``We're a good $100,000 down,'' Imig said. ``If we could move without taking a huge bath, we would.''
Past Busts
Previous California housing busts had roots in local economic woes and U.S. monetary policy. The state lost 350,000 jobs in the early 1990s, about two-thirds in the aerospace industry, according to the Cato Institute and Los Angeles County Economic Development Corp. Home prices tumbled 12 percent. In the early 1980s, existing-home sales dropped 61 percent amid interest rates of more than 14 percent and a national recession, the state Realtors said.
California may rebound more quickly from this decline than regions with fewer delinquencies and vacant homes, according to Zandi of Moody's Economy.com. The foreclosure process is ``more efficient'' than in states such as Florida where courts are involved, and Californians are typically ``more optimistic'' about housing after experiencing busts that were followed by property booms, Zandi said.
``They know it's going to be a good investment five or 10 years down the road,'' Zandi said. ``The fundamentals are good: supply constrained markets with lots of population growth, a solid and diversified economy and important global links'' in Los Angeles and San Francisco, he said.
`Bidding War'
It may take until 2010 for foreclosure sales to work their way out of the system in areas where defaults have soared, said Thornberg of Beacon Economics.
``Those sales are going to have a very large impact on prices for the next year or so until those homes get absorbed by the market,'' he said. ``Housing markets don't bounce, they splat. They hit bottom and they stay there.''
That's good news for buyers like Peggy Thorpe. She outbid seven offers for a foreclosed house in Vallejo, east of San Francisco, and still got a 34 percent discount. It was the sixth time since May she made an offer for a home in foreclosure.
``This time I jumped higher,'' said Thorpe, 43, who works at a vineyard in Napa and paid $190,500 for the three-bedroom home with a loan balance of $289,000. ``There's an extreme bidding war right now.''
To contact the reporters on this story: Dan Levy in San Francisco at dlevy13@bloomberg.net; Daniel Taub in Los Angeles at dtaub@bloomberg.net

I've been a nutmeg lover ever since my mother first sprinkled a little on top of my Christmas eggnog. It was good then, but it's better now that I grate my own. If you think nutmeg is a spice that belongs in the back of the cupboard, think again. Its mild flavor can be deceiving because it isn't as aromatic as cinnamon, or as aggressive as allspice, but nutmeg has something amazing going for

cartoon courtesy of Nearing Zero.Happy Gardening!Garden Gnome©2006-2008

Euonymous(Euonymous fortunei)July 15, 2008Euonymous bushes (Euonymous fortunei) are a common feature in many gardens here in Ontario. The two varieties I'm aware of are yellow and white edged both with bright green centres. These really are easy to grow shrubs with few problems. I had a small one at our previous house with the only problem being plagued by aphids but it was planted beside a

The Dallas Morning News - July 3, 2006

Fairview's motto is "Keeping it country."

But one look at a map shows why that's hard to do.

Wedged between Allen and McKinney on the east side of U.S. Highway 75, the Collin County town of 5,700 is next in line for a development boom.

Builders are already putting up new subdivisions lined with custom homes.

And starting next year work will begin on a 200-acre shopping center that's as big as some malls.

While the big city is knocking at Fairview's front door, city leaders say they want to keep the rural flavor for much of the town.

"We are trying to take advantage of the growth and protect ourselves at the same time," said Fairview City Manager John Godwin. "It looks like we are going to be able to do that."

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The Dallas Morning News - August 13, 2005

For many, a bigger home is better, and it's cheaper here than in many places

LOS GATOS, Calif. – Nestled on a wooded hillside in this tidy Silicon Valley community is a subdivision of newer tract homes with media rooms, breakfast nooks, granite countertops and other modern touches.

Like models on a Monopoly board, big new homes line the streets in the Twin Creeks subdivision in Allen. The homes are not unlike those you'd see in a similar high-income neighborhood in Allen, McKinney or Frisco – until you compare the price tags.

A $300,000 home in or near Collin County would cost about $1 million in Los Gatos.

When families move to North Texas from places like Silicon Valley, they are awestruck by the monster houses they can afford. They don't tend to hold back, said Jan Richey, a Realtor with Keller Williams in Frisco.

"Instead of buying the $300,000 house – which they should – they have so much more money from the equity in their previous house that they extend themselves as far as they can go," she said. "We have to protect them from themselves."


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White Nancy Lamiums(Lamium maculatum)June 26, 2008Moving into a home with mature landscaping has meant discovering a lot of new to me plants. We moved in late June so that meant we had no idea what spring plants there were. Part of the fun has been identifying the various plants as they emerged to decide if they were friend or foe. This means that I have had a wonderful opportunity to expand my

Sweet Million Tomatoes(Lycopersicon esculentum)July 16, 2008If you have been following this blog you will know we moved last year and still do not have the vegetable and herb beds in. They are in progress but we were delayed by the spring weather conditions. We plan on having them ready for fall gardening and to allow the perennial herbs to root well before the cold weather. I'll talk more on

While you are enjoying all of this hot summer weather, don't forget to protect your herbs. Water them in the morning and never spray the leaves of your outdoor plants during the hottest part of the day. Deep water herbs at least once a week, and be sure to pinch the stems of any herbs that are starting to bolt. This will help extend the useful life of annuals for a couple of weeks.If you are