Sonoma County Real Estate and Community News Blog

Sonoma County Real Estate and Community News BlogSafe Haven Realty is your LOCAL source for all things regarding Sonoma County homes for sale and Sonoma County real estate. You will find a collection of knowledge here from local events to community news and market reports. Below you will find the most recent blog posts about what's going on in Sonoma County. For a categorized list of posts, click the links provided in the sidebar. 

When you are ready to buy or sell a home, contact Safe Haven Realty! We know Sonoma County!

June 2, 2016

Solar: A tale of buying vs. leasing

Is Solar Worth ItIn October 2014 I had Solar Panels installed on my 7 year old roof. I did my homework and found that leasing solar is not a good option for several reasons:

  1. Solar lease contracts are for 20 years! If you sell your home within those 20 years, be prepared to pay the consequences. A potential buyer has to qualify to take over the remainder of your solar lease. If the leasing company requires a FICO score of 730 and your buyer is a 700 then take a hike, Charlie!
  2. You aren't really saving much money by leasing solar panels. Instead of paying your local electric company, you are paying someone else. Maybe the bill is slightly less, but why let someone install personal property on YOUR roof to save $15 a month?
  3. Leased solar panels do not add anything to the value of your home. Purchased solar panels do.
  4. And now for the kicker ... when the solar lease company installs panels on YOUR roof, THEY get to use YOUR tax credit, not YOU. That would be 30% of the cost of the solar installation, we are talking thousands of dollars here.

So I purchased a solar system instead of leasing and now it is time for an update. I saved an average of $85.00 a month for 12 months, then received a check for $115.85 from the electric company for the surplus of power generated that I didn't use. My first year savings for installing solar panels is $1135.85. Every year, as electricity rates go up, I'll be realizing even more savings. At this pace, the panels will have paid for themselves in about 7 years. From then on it is free electricity, baby!!

So tell me, do you think that a home with purchased solar panels is going to sell quicker than a home with a leased solar system? Absolutely. Think twice before letting someone talk you into leasing solar, it really isn't a good idea for anyone except for the salesman trying to talk you into using "clean power".

Posted in Home Improvements
March 14, 2016

FHA Assumable Loan Option For Buyers

FHA Assumable Loan Options For BuyersDid you know? FHA loans are assumable! After the demise of stated income loans and 100% financing, FHA loans became extremely popular. Between 2008 and 2015, approximately 20% of all loans used to purchase a home were FHA loans. That means 1 in 5 homes for sale right now could have an assumable loan that a buyer could take over.

What are the advantages of assuming a FHA loan?

  1. The cost to buy a home: I'm sure you have heard of buyer's closing costs. The largest portion of those closing costs are the fees that are charged by the lender. Buyers are sometimes shell shocked when they learn how much they will be spending for the origination of their home loan. So good-bye lender fees, good-bye appraisal. By assuming a FHA loan, a buyer can save thousands of dollars in closing costs.
  2. Interest Rate: The terms of the existing FHA loan are fully assumed, and this includes the interest rate. The buyer wins when the interest rate of the assumable FHA loan are lower than current rates. This allows the buyer to save even more money, month after month.
  3. Time: When a FHA loan is assumed, the buyer takes over right where the seller left off. This means that if the FHA loan originated 6 years ago, the buyer will assume the last 24 years of the sellers 30 year loan. If you look at an amortization table (any mortgage calculation web site will show you one), you will see that during the first years of a 30 year mortgage, very little of the monthly payment is applied to the principle.

What are the disadvantages of assuming a FHA loan?

Namely there is only one disadvantage of assuming a FHA loan as opposed to originating a new one. The difference between the purchase price of the home and the remaining balance of the current loan will have to be made up by the buyer. So if the purchase price is $500K and the loan balance is $450K, the buyer will have to bring $50K to the closing table along with any other buyer closing costs. This can require more cash than getting a new loan, but the cash would be going towards EQUITY in the home, not fees to lenders.

Why does it make sense to assume a FHA loan?

  1. Save thousands in closing costs
  2. Save hundreds month after month if the interest rate is lower than today current rates
  3. Save thousands (or tens of thousands) by assuming a shorter term loan
  4. Convert cash into equity which in turn will generate more equity

So what are you waiting for? Ask your agent if the home you are interested in has an assumable FHA mortgage!

 

Posted in Buying
Feb. 17, 2016

Sonoma County Foreclosure Trend

Not all areas of the country were severely affected by the mortgage crisis that began in early 2007. I wish we could say that Sonoma County was spared, but it wasn't. Around the Summer of 2007, we started seeing a lot of foreclosed properties hit the market.

At that time, our MLS didn't have a data field where we could specify that a property was distressed. In early 2008, our MLS added two sale condition fields for our listings, REO and Short Sale. As such, the number of REO and Short Sales sold in 2008 are understated in this chart, but it gives you an idea of the number of distressed property sales we had in Sonoma County between 2008 and 2015.

 

Sonoma County Foreclosure Trend 

 

In 2008, 2009 and 2011 the number of REO and Short Sales combined outnumbered traditional sales. Beginning in 2012, Sonoma County began its recovery from the foreclosure crisis where so many lost their homes. In 2015, there were only 240 distressed sales compared to 5,293 traditional sales.

We still hear from buyers who are interested in buying a foreclosure. No doubt they have heard stories about the "good deals" that were out there. Foreclosures are still available for sale in Sonoma County, you can find them on the advanced property foreclosure search.

 

 

Posted in Sonoma County
Feb. 13, 2016

You Might Be A Sonoman If ...

  • You might be a Sonoman if ...You have "Barrell Tasting" written on your calendar, the first weekend in March.
  • When someone mentions "Pliny The Younger", your mind doesn't wander off to Ancient Rome.
  • You know that you really can't pet a Luma!
  • You think nothing of running into Peanuts characters in Santa Rosa.
  • You know which airport has a beagle on a flying dog house as a mascot.
  • You don't have any problem spelling Sebastopol.
  • You know what "The Crush" means.
  • You laugh when out of area visitors complain of "Sonoma Aroma".
  • You've participated in cow chip throwing.
  • You tell folks that Sonoma County makes wine, Napa makes auto parts.
Posted in Sonoma County
Feb. 12, 2016

Sonoma County Property Taxes

We get a lot of questions while we help buyers buy a home in Sonoma County. One of the most frequent, especially from out of area or first-time home buyers is "How much will my Sonoma County property taxes be?"

Sonoma County Property Taxes

The quick answer is this: Figure on having to pay 1.25% of the purchase price of your property. So if you buy a home for $500K, your property taxes the first year will be around $6,250.

The long answer is, the base tax rate is 1% (per proposition 13 which was voted in by California voters in 1978) plus any local county and city voter approved bonds.

The image above shows the property taxes from a home in Cotati, covering the period from July 1, 2015 through June 30, 2016. The Prop 13 base amount (1%) is $3,823.08 which tells us that the home is currently assessed at $382,308.00. The local voter approved bonds add an additional $806.20 which includes funding for Warm Springs Dam, Schools, Fire protection and Mosquito abatement.

The good news is that your property taxes aren't due in one lump sum. In this tax bill, the amount that covers July 1, 2015 through December 31, 2015 is $2314.64 and was due by December 10, 2015. You can see above that the homeowner paid that amount on December 7. The same amount of money will be due again by April 10, 2016 which will cover the period from January 1, 2016 through June 30, 2016. It looks like the homeowner will be waiting until April to pay that portion of the property tax bill.

Every city has different voter approved taxes, we can help you figure out what your tax bill will be when you buy your home in Sonoma County.

 

Posted in Sonoma County