South Orange County Blog from Bob Phillips

Orange County Median Housing Price Hits $600,000 Mark

sold-homeThe median price of a home in Orange County rose to $600,000 in April, up by 4.2 percent from $576,000 in April 2014, a real estate information service announced today.

According to CoreLogic, the number of homes sold rose by 12.4 percent, from 3,111 in April 2014 to 3,497 last month.

“Sales activity picked up last month, making it one of the stronger Aprils since the housing bust, though sales  remained below average,” said Andrew LePage, a data analyst for CoreLogic. “Many buyers still face credit and affordability hurdles, and the inventory of homes for sale remains relatively tight in many markets. New home construction is still well below historically normal levels, too.”

In A total of 21,708 new and resale houses and condos changed hands in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month, according to CoreLogic. That was up 9.9 percent from 19,706 in March and up 8.5 percent from 20,008 in April 2014.

The median price for a Southern California home was $429,000 in April, up 0.9 percent from $425,000 in March and up 6.2 percent from $404,000 in April 2014.

If you have been looking to buy a house in Orange County, you know that the process has been a bit frustrating. Nice homes are selling quickly, frequently with multiple offers. ( Multiple buyers offering on the same property.) My past few sales have all involved such a challenge.

Fortunately – for MY clients – I’m very experienced in such situations, and in every case ours was the successful offer. And, NO, it’s not always about having the highest offer.

Need some good news? This present flurry will pass – probably in only a month or two. If you can exercise a little patience, waiting until late July, or early August, most of the highly competitive buyer activity will likely start to cool down, making for a better environment for a home buyer. The last part of almost every year is a much better time to buy, with fewer competitive buyers, and more houses coming onto the market – a perfect storm for a home buyer.

If you NEED to buy sooner than later, just make sure you’re working with an experienced agent, who can guide you through all the potholes of a real estate purchase. With over 38 years of local service, I happen to be just such an agent, and would be honored to go to work with you, to help find your next home.

Give me a call at (949) 887-5305, or shoot me an email to, and let’s go shopping!

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HARP and HAMP Receive Probable Final Annual Extension


( An article from Colin Robertson of dated May 11, 2015 )

Since being introduced back in 2009, both and the Home Affordable Modification Program (HAMP) and the Home Affordable Refinance Program (HARP) have helped millions either avoid foreclosure and/or save money on monthly mortgage payments.

Both programs have been deemed pretty successful, though the numbers did fall short of original projections (as everyone probably expected) despite several annual extensions. I think the original estimate was nine million.

HAMP Is Finished at the End of 2016


Since HAMP was launched in the spring of 2009, a total of about 1.5 million homeowners have received permanent loan modifications through the fourth quarter of 2014.

Nearly 2.3 million trial modifications were started but fewer than one million are permanent and still active either because of a positive outcome such as loan payoff or alternative modification, or because of something negative like a short sale or foreclosure.

This has resulted in aggregate savings of approximately $32.7 billion compared with prior unmodified mortgage obligations.

The goal of HAMP is to get the borrower’s front-end DTI ratio down to 31% by reducing the interest rate, extending the loan term, and potentially forgiving principal.

About 95% of HAMP loans received an interest rate reduction, though those are temporary and subject to rise.

Just over 60% of HAMP borrowers received a term extension and less than a third (30.3%) received principal forbearance.

[HAMP participants are now eligible for $5,000 more in principal forgiveness.]

HARP Probably Done After 2016

The Home Affordable Refinance Program (HARP) is a program that allows underwater borrowers with Fannie Mae- and Freddie Mac-backed mortgages to refinance to take advantage of lower interest rates.

It originally allowed borrowers to refinance with LTVs as high as 105%, but that number was later increased to 125% and eventually the cap was removed entirely for most types of loans.

Over the years there were pleas to expand the program and open it up to borrowers with non-agency mortgages (remember HARP 3), but those demands fell on deaf ears.

To date, roughly 3.3 million borrowers have taken advantage of the program, though the numbers have been waning lately. Around 10,000 borrowers are refinancing monthly via HARP nowadays.

This is not unexpected given the fact that most have already applied for assistance under the program or no longer need it thanks to rising home prices.

During FHFA director Mel Watt’s speech at the Greenlining Institute 22nd Annual Economic Summit last Friday, he spoke about both programs and revealed that HAMP would be finished after one final extension through the end of 2016.

Since March 2013, Fannie and Freddie have also offered a proprietary Streamlined Modification that requires less paperwork than HAMP, and this could serve as an ongoing loss mitigation solution for borrowers.

As far as HARP goes, he said “we anticipate that this will also be the final extension for HARP.”

Apparently some 600,000 plus borrowers could still benefit from HARP though they’ve yet to come forward for one reason or another.

Watt said the FHFA will use the next year and a half “to explore possible streamlined refinance solutions for future Enterprise loans,” so there might be some kind of permanent HARP solution for Fannie and Freddie loans that “might apply in a non-crisis environment.” ( End of Colin’s article.)

From Bob Phillips:  Over the past couple of years, local house prices have risen substantially, which may help in two different ways.  First, former underwater homeowners may now actually have some equity, hopefully allowing a little breathing room.

Second, owners having difficulty making their payments on a loan that has a high interest rate, may, in fact, be able to refinance now, where they couldn’t before, staying in their home with a lower payment, OR, they may now be able to sell their home without going through a short sale, getting themselves out from under a terrible loan that they’ve been living with, for years.

Even if the home is STILL underwater, solutions have become easier to accomplish, if you’re dealing with an agent who has both training and experience, in dealing with distressed loan situations.  I, Bob Phillips, have both the training, and the experience, to help you sort out the many options you might have.

If you – or someone you know – is still having difficulty making their house payments, please consider calling me at (949) 887-5305, or shoot me an email to

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Signs of a Neighborhood on the Rise

prices-upA neighborhood on the rise offers things you definitely want: a great space at a good price, and the promise of improvement (and rising home equity). But how do you know when a neighborhood is getting ready to take off? There a few signs to look for that can steer you to the next hot zip code. (Remember, Brooklyn was once considered highly undesirable!)

It’s near another hot spot.
Location, location, location! If you can’t afford the prices in the currently desirable metro area, then look at the neighborhoods adjoining. It’s likely the amenities you’ll find there will be creeping into the adjoining neighborhoods, and yours could be next.

You can get there from here.
Excellent public transportation and freeway access generally mean young people moving in, which in turn leads to…

…Independent business and trendy shops popping up.
A young demographic in a neighborhood generally attracts bars and restaurants that are chasing millennial dollars. Look for store and restaurant trends that you’ll find in the already hot neighborhoods — farm-to-fork, wine bars, even vape bars. And of course an uptick in the number of hardware and home improvement stores is always a good sign.

Upscale chain stores are also encroaching.
These businesses spend a lot of money tracking demographics and conducting market research before they begin to move into an area. Let them do some of the groundwork for you. Stores catering to a higher income clientele, such as Trader Joes, Whole Foods, and of course Starbucks are the ones to watch.

Homes are selling faster and faster in the area
If you notice a lot of houses undergoing renovations or new home construction, and more For Sale signs, it’s time to ask your real estate agent the average time a home in that area spends on the market. As the number of days on the market declines, the housing market in the area will be heating up. If you can get in at the beginning of this trend, you’ll probably get a great price on your new property.

Looking for a neighborhood on the rise is always taking a chance. There’s no guarantee you’ll be getting in on the next most desirable place to live in your area. But by looking at the signs listed above — and having a great real estate agent who knows the area and can offer guidance — you could be getting a great place for a much lower price. With over 38 years of continuous service in South Orange County, I not only know the area, but have the experience to guide you well.

Give me a call, ( 949-887-5305 ) or shoot me an email, ( ) and let’s go house shopping!

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Underwater Borrowers Account for 77% of Active Foreclosures

Posted in Uncategorized by southorangecounty on May 7, 2015


By Colin Robertson of, 5/6/15

While foreclosures might sound like old news, there are still a ton of borrowers either behind on mortgage payments or in the process of foreclosure.

And it doesn’t appear as if the type of loan they took out was the problem. It’s just the fact that they took out their loan at exactly the wrong time.

And by that, I mean most borrowers facing foreclosure these days are underwater on their mortgages, and deeply underwater at that, possibly because they purchased homes at the height of the market.

That brings us to a new report from Black Knight Financial Services, which revealed that borrowers in negative equity positions accounted for 77% of all active foreclosures, per their latest Mortgage Monitor for the month of March.

So while some might just be having trouble with monthly payments because of a job loss or an illness, or simply because they took on too much mortgage, most are behind because their property values are in the red.

It might be conjecture to say that, but it’s clear there’s little incentive to keep paying an underwater mortgage, especially if it’s still underwater after all the recent home price gains.

Put simply, it makes sense that 29% of underwater borrowers are seriously delinquent on their mortgages.

Cheaper Homes 9X More Likely to Be Underwater

Black Knight also found that borrowers who own the bottom 20 percent of homes by price are nine times more likely to be underwater when compared to those in the top 20 percentile.

In other words, high-end homes have largely avoided the negative equity crisis that has plagued the rest of the market.

This could be a combination of higher down payments, more affluent borrowers, and better performance (rebounding) of higher-end homes.

Overall, their data show that slightly more than eight percent of all borrowers are currently underwater on their mortgages.

The good news is we’ve seen a near-30% decline in the negative equity rate from a year earlier.

The bad news is one of every three borrowers currently in the process foreclosure has a loan-to-value ratio of 150% or more.

For the record, Nevada and Florida continue to lead the country in terms of negative equity rates, with 16.4% and 15.1% of borrowers underwater, respectively.

And Florida and California have the highest number of underwater properties.

Mortgage Delinquencies See Largest Drop in Nine Years

The mortgage delinquency rate has also improved immensely, and though seasonal declines are typical in March, the 12.18% drop seen this year was the largest monthly decline in nearly a decade.

Additionally, declines have been witnessed in all stages of delinquency (30, 60, 90 and 120+ day lates).

In fact, 30-day delinquencies hit their lowest level in over 10 years. And for every 10,000 loans that were current at the end of February, just 73 missed a payment in March, the lowest current-to-30 day late roll rate in over 15 years.

Roll rates from 30-to-60 and 60-to-90 days delinquent also fell to their lowest levels in nine years, and loans that were previously delinquent are curing (becoming current again) at the highest clip since 2005.

So while underwater loans persist, new problem loans seem to be few and far between.

Separately, the MBA reported today that the delinquency rate for mortgage loans on one-to-four-unit residential properties fell to a seasonally adjusted rate of 5.54% as of the end of the first quarter.

This is the lowest recorded rate since the second quarter of 2007.

Meanwhile, just 2.22% of loans were in some stage of foreclosure, down from 2.65% a year earlier, the lowest foreclosure inventory rate since the fourth quarter of 2007.

So it looks as if things are nearly back to normal, though certain areas of the country continue to suffer disproportionately.

The scary part is that NAR thinks home prices are overvalued again, but if prices dip again negative equity-related problems could resurface. ( End of Colin’s article.)

From Bob Phillips:  If you, or someone you know, is having difficulty making your mortgage payments, I, Bob Phillips, am both highly trained and well experienced in helping homeowners come up with solutions to such problems. Give me a call today, and let’s find a solution together. There is no charge for this assistance. Call now!  Bob Phillips, 949-887-5305

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