Barry Noble's Blog

Face it. This cyclical downward trend has just started in California. Just as California is the last of the States to rise in value in a typical cyclical Residential Real estate upswing, so is California the last to be affected when the Market turns back down.

No, the Market is not going to “correct” during the Summer off-season here in the Valley and start rising again in the Fall. No, this is not going to be a short downswing. As California follows the Market Cycles that start their up or down swings on the East Coast and spread across the country to the West, so does Southern California follow San Francisco and Seattle’s several months behind Northern California.

This Market Cycle is typical, has been evolving over the decades and is fairly predictable. It just can be a moderate cycle up or down, or a real bear, and this one is an angry bear. The mortgage debacle is but one of the side problems that has us in and heading further into a harsh recession, and the foreclosures, as frightening as they sound now, are moderate to what they most probably will be over the next 12 months. There are so many people heading into teaser fixed rates change-over to fast rising adjustables, and they are not doing something about it NOW. They think the Market will turn back up in a few months and all will be well before their adjustables kick in. WRONG.

The Real estate Profession is a hard one to predict with truth and honesty – no one wants to hear the truth, or a common sense predictions. Most Real Estate agents live on hope that the Market will for ever rise and the bad-mouthing I get for these predictions or advice is unbelievable.

Again, I can’t stress it enough. If you have bought a home in the Coachella Valley within the past 5 years, are still on or just changing from a reasonable “teaser” fixed rate to an adjustable rate, and you have been “just able” to cover the fixed rate mortgage - contact your lender NOW. The fast and sharp rise in mortgage rates will put you behind the eight ball before you will be able to say “What Happened?”

If you have a low fixed rate, plan to live in your home for at least another five years, then sit back and relax. You’ll notice your home value may drop dramatically over the next 12 to 18 months – but in your position, who cares? You don’t need to be looking for a refinance cash out mortgage in this negative Market, just sit tight, and when the next Market Cyclical upswing happens, and it will, the values will recover – and typically will rise higher than the previous Cycle upswing peak (late 2006).

If you purchased in the past 3 years – there is a good chance your value has already dropped below its purchase price – and thus you are being taxed on a higher value than it is worth. You can call me if you want a drive by appraisal and accurate comparison study to submit to the County to appeal your home value, and hopefully secure a lower value on which to base future property taxes. Remember this is not retroactive, so the sooner you do it the faster there might be a lowering of your property taxes. You can also contact me for listing value, Broker and Appraisal consulting. If you are sitting on the Market month after month with a listing price well over the local current market value, you are wasting both your time and that of your agent. If you don’t have a knowledgeable Broker in this type of Market, you are just plain wasting time. Barry Noble, Palm Springs. barry@FastAppraisalValue.com www.FastAppraisalValue.com