The County median price was $432,000 in March, with a 9% volume increase as well. We are still seeing a substantial percentage of “distressed sales”… 1/3 were foreclosures and I didn’t find any stats on short sales but I know there are plenty.
Over 20% of last month’s sales were ALL CASH BUYERS. This is most common in sales below $450,000…which is pushing out a lot of first-timers. The investors are winning the battle unfortunately.
Mortgage Insurance
The big news of last week is that the private mortgage insurance (PMI) has just become more easily accessible to conventional borrowers (non-FHA). For the last few years there have been substantial limitations on areas of “declining values” i.e. California, Arizona, Michigan, Nevada and Florida.
The new guidelines provide Mortgage Insurance up to 90% and 95% LTV in some cases, depending on the individual company guidelines. The minimum FICO scores required in order to qualify for mortgage insurance have also been reduced. Companies “back in the market’ include MGIC, Radian and Genworth.
Up until now, the only path available was an FHA loan for those buyers without 20% down and a FICO score below 720-- here in California. I have a client with a score just below 700, and before this change he wasn’t able to qualify for PMI, although his debt-to-income ratios met the stringent guidelines.
For those of you who don’t know, PMI is typically paid monthly by the borrower, and guarantees the lender (insures) for the portion of the loan over 80% loan-to-value. These companies have been under great financial strain due to the last few years’ tremendous losses.
This announcement comes on the heels of more restrictive guidelines handed down by HUD for FHA loans. HUD is tightening up on FICO scores, by restricting loan-to-value for those borrowers with lower scores. So, they will have to come up with a larger down payment.
California Wine Festival
The first annual California Wine Festival in Dana Point was held last Thursday through Saturday. Thursday evening they held an event at the Ritz Carlton, Friday evening at the Dana Point Yacht Club, and Saturday afternoon at Doheny State Beach Park. I attended the Saturday event which was sold out at 3000 attendees. There were over 60 wineries, both well-known and boutiques that poured a wide variety of wines. Five breweries had beers and ales to sample, and a number of restaurants provided tasty appetizers. All the food and wine was unlimited, although a few booths ran out of some wines near the end of the day.
Lines were minimal, fun was in abundance, and the music was reggae/calypso style so of course I practiced my Zumba technique. The weather cooperated with sun and a light breeze, to provide an afternoon that couldn’t have been more perfect. We made new friends, and ran into old ones.
Next stop for the afternoon was Turk’s in the Harbor, on the water… for some sightseeing… and we finished the day at Sunsets’ on PCH across from Capistrano Beach…. where a band of guys my age (or older!) played surf music while we dined on pork from a whole pig they’d roasted across the street in a pit on the state beach. What a hoot! This lively bar has big screens for the sports’ fans, and live music on weekends.
Back to the Wine Festival – although this was their first time in Dana Point, they will host the same event in mid-July in Santa Barbara for the 7th year. For more info, here is their website: http://www.californiawinefestival.com/index.html
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