Aaron Smith’s Blog

Last week we attended the official opening and ribbon cutting of the Pacific Highlands Ranch Fire Station #47 - San Diego’s newest (and best) fire station.  The event was well attended by top SDFD officials, Scott Peters as well as Mayor Sanders.  Sanders remarked that this may just be the nicest new San Diego public facility he’s ever seen and he might be right.  The station is state-of-the-art and beautifully finished.  Certainly the Fire Captains with seniority will be fighting for a post here.

Council President Scott Peters said this station was an example of how to do things RIGHT… that PHR is only at about 30% build-out and we already have much of the infrastructure that will be needed (also referencing the new NW Police Station).  Most importantly, this station means that emergency response times will drop significantly in our area.  Plus, this new station #47 is one of the few that is wired to be an emergency command center, which means that in the case of a major emergency, we’ll have the best resources right here in our back yards.

We will be working with the new Captains on duty to arrange an open house for residents to meet their new neighbors and tour the great facility and will keep you posted on that.

The article below from Reuters News could provide great opportunities for home buyers hesitant to jump into a Jumbo loan program.  By significantly raising the conforming loan limits, buyers with loans greater than the current $417,000 limit (but still within the yet-to-be-announced new limit) will enjoy a lower interest rate than were possibly now.  Jumbo rates typically are at least 1/2% higher than conforming.  Certainly welcome relief for San Diego home buyers.  And we may see more refinancing as a result too.  See the full article below…  AARON SMITH - WWW.ROUTE56HOMES.COM

Article By: Patrick Rucker Fannie, Freddie eligible loans get $300,000-plus boost

WASHINGTON, Jan 24 (Reuters) - The size of home loans that may be bought or insured by Fannie Mae FNM.N, Freddie Mac FRE.N and the Federal Housing Administration would rise by more than $300,000 under an economic stimulus plan pitched by the U.S. House of Representatives.

Under the plan outlined Thursday, Fannie and Freddie would be permitted to invest in home loans valued as high as $729,750 for one year, while the FHA would be be permitted to indefinitely insure loans up to that level. Currently, Fannie Mae and Freddie Mac loans are capped at $417,000, while FHA loans may not exceed $367,000.

Since the summer, investors have shunned home loans that did not pass through Fannie Mae, Freddie Mac, or the FHA as they watched Wall Street firms take big losses on their risky home loan investments.

Fannie Mae and Freddie Mac are publicly trade companies that hold federal charters to nurture the nation’s housing market, while the Federal Housing Administration, set up after the 1930s depression, helps borrowers win favorable loan terms by guaranteeing mortgage payments to lenders.

The government ties of all three enterprises have been appealing to investors as the housing market has been rocked by a spike in foreclosures.

LOWER COSTS EXPECTED

Proponents of reform say the new loan levels will draw investors back into the home loan market, resulting in lower costs for mortgage borrowing. In recent months, the interest rate on high-cost loans has been about 1 percentage point above that for mortgages that could be financed by Fannie Mae and Freddie Mac.

Prospective home buyers in costly regions like California, Northern Virginia and New York have faced higher mortgage rates and tougher loan terms, and those areas would get relief under the plan, said Susan Wachter, a professor of real estate and finance at the Wharton School of the University of Pennsylvania.

“This is meaningful because the mortgage crisis and meltdown is geographically concentrated,” she said. “This response will assist the stressed areas” by lowering the cost of home ownership.

Thursday’s plan has been broadly endorsed by the U.S. Treasury Department and both Democrats and Republicans in the House of Representatives. Members of the U.S. Senate have yet to weigh in, and they could demand changes to the plan meant to boost the flagging economy.

And while Treasury broadly supports the initiative, it has long opposed giving Fannie Mae or Freddie Mac more investment powers before Congress ratifies root and branch reform legislation.

James Lockhart, the director of the Office of Federal Housing Enterprise Oversight that regulates the two, said in a statement that his agency was “very disappointed in the proposal to increase” the loan limits. As the main regulator for Fannie Mae and Freddie Mac, Lockhart has warned that he does not have the oversight tools he needs and so the companies’ business should not be allowed to expand.

Other industry critics have cautioned that Fannie Mae, Freddie Mac and the Federal Housing Administration are playing an outsized role in the housing market that is too risky and draining business from fully-private firms. (Editing by Leslie Adler)

 

On Tuesday, January 22, 2008 the Carmel Valley Planning Board (CVPB) held a special meeting to consider adding seats to the Board to incorporate the newer Pacific Highlands Ranch area of Carmel Valley.  Pacific Highlands Ranch included the subdivisions of Airoso, Arabella, Portico, Santa Rosa, Bordeaux, Soleil as well as two apartment complexes.

The Board intends to add two seats to the existing Carmel Valley Planning Board.  These two seats will be occupied by Pacific Highlands Ranch residents, yet to be named.  The few members of PHR that did attend the meeting offered their opinions and suggestions and were appointed by the Board to the Pacific Highlands Ranch subcommittee to assist in getting the word out to PHR residents.

The issue will be addressed again at the CVPB’s regularly scheduled meeting the fist Tuesday of February.

For more information, contact Aaron Smith at sold@route56homes.com

Good Morning Friends and Clients,Many of you have recently contacted us asking about the latest overseas and domestic economic news… and in particular the aggressive move of the FED to cut rates by 3/4%.  As you know, we are not mortgage brokers, but after consulting with our trusted colleagues, we’ve prepared a brief summary of this week’s news and how it will affect you as homeowner or potential homeowner.  Always feel free to contact us directly for an analysis of your specific situation at sold@route56homes.com or 858-456-9152.

While we were enjoying our Martin Luther King Holiday, Asian and European markets were in a free fall. It turns out that yes, the U.S. economy is still the world’s leading economy. The old adage “when the U.S. sneezes, the world catches a cold” seems to hold true. While some European and Asian countries seemed confident that they were finally independent of our economy, it turns out that with the U.S. flirting with a major recession their economies suffered right along with ours.

Insert the Federal Reserve. The Federal Reserve is not owned by the government. In fact, it is largely owned by 5 large U.S. Banks who in turn have large shareholders from Europe and Asia. As these shareholders saw their own markets tumbling, they began to put pressure on the U.S. Banks to have Feds to step in immediately and make a drastic move to spur the U.S economy.

So, while some of us were enjoying the day off, the Feds held an emergency inter-session meeting and lowered both the Discount Rate and the Feds Fund Rate a whopping .75%. The last time the Feds held an emergency meeting between scheduled meetings was September of 2001.

Mortgage Rates had been falling prior to this move, and fell again in response to the Fed’s move. Rates are once again near all time lows. The stock market in turn has proved extremely volatile with huge early losses this morning and a rally midday. Mortgage Rates were re-priced two times yesterday. You’ll also see a 3/4% drop in your credit card rates, auto loans, adjustable 2nd mortgages and HELOCs (home equity lines of credit) as these rates are more directly tied to the Prime Rate.

Prime is now at 6.5%. Mortgage rates are already so low and the Feds meet again next week. Many feel the Feds will make another cut. There is pressure now for the European Central bank to lower their rates. So far, the Central Bank has held steady. If they do make a move, it will leave the door open for the Feds in turn to lower rates once more next week.

What does this mean to you, the homeowner? Well, it points out that the U.S. economy retains its position as the world’s dominant economy. It also means that rates are so low that now is definitely a great time to refinance your current mortgage. If you are on the fence and have been waiting to purchase a home, contact us now so that we can analyze your situation.

If the Feds make another move, it will most likely be soon. Real Estate is at or near the bottom in most areas and there are wonderful opportunities to roll the clock back and purchase a great property at a huge discount.

If you own a home, consult your mortgage broker and evaluate if you could lower your monthly payment by refinancing. If you have an adjustable mortgage consider refinancing to a fixed rate mortgage. If you are looking to purchase a home, many are now saying “sooner rather than later”. You will have a huge tax advantage and can lock in on a fixed rate mortgage in the low 5% range.

As always, I am happy to answer any questions you may have regarding any of this. 858-456-9152 or sold@route56homes.com.

Warm Regards,
Aaron & Michele Smith

For the past 30 years, the median price of existing homes has increased an average of more than 6 percent every year, and home values nearly double every 10 years.

Stories about mortgage fraud, foreclosures and crashing markets have far outpaced the good news — that owning a home is one of the most reliable ways to build wealth for most people.

An uplifting piece of information cited by Ruth Mills

NOTE: THE ARTICLE BELOW APPEARED IN THE “CARMEL VALLEY NEWS” ON NOVEMBER 22, 2007. BECAUSE LINKS TO THAT NEWSPAPER ONLINE EXPIRE EACH WEEK, THE ARTICLE IS BEING POSTED HERE FOR RESIDENTS TO REFERENCE. THE ARTICLE WAS WRITTEN BY SUZANNE EVANS AND HAS NOT BE ALTERED IN ANY WAY.

CV board favors Pacific Highlands Ranch Village plan, but notes adamant opposition to proposed cinema

By Suzanne Evans

Carmel Valley Planning Board chair Frisco White had to bang his gavel only once Nov. 13, sharply reprimanding a few participants who interrupted a feisty debate that threatened to escalate among residents adamantly opposed to a planned cinema at Pardee Homes’ Village at Pacific Highlands Ranch, located at the corner of

Carmel

Valley and Village Loop roads.

Insisting the village project follows the PHR sub-area plan of the 1990s, and that the cinema will attract visitors to restaurants and shops, Pardee representative Ron Brockhoff, director of multi-family and commercial development with Pardee, and Ted Shaw, of Latitude 33 Engineering, Pardee, presented revised plans they hope will make the village center a community asset.

Pardee envisions the 27.67 acre village center as a pedestrian-enticing, walkable community embracing an attractive mix of uses, lush landscaping, and curving paths, with restaurants and shops that will invite residents into the center. “The movie theatre will draw people; otherwise other [village] uses will flounder,” Shaw said.

Pacific Highlands Ranch Village comprises 292 residential dwellings (affordable and market-rate), 215,000 sq. ft. of commercial space, a transit center, an 18,000 sq. ft. community library, and a three-acre civic use area.

As of the board’s Nov. 13 meeting, a tally of online adjacent homeowner votes revealed 97 residents opposed to the cinema and only about eight approving. A typical voter comment read, “I do not recall any proposal to build a movie theatre when I purchased my home two years ago . . . I vote absolutely No.” Other residents’ concerns were: lack of information dispersed to the community, desire for increased planning board’s involvement in homeowners’ concerns, and lack of time for residents to evaluate the project.

Some in the audience as well as board members, however, praised the scale and atmosphere of the project, the possibility of increased home values, the flowing central corridor and a place for students to mix with the community.

Pardee made concessions to residents since their Oct. presentation, reducing the cinema area to 35,000 sq. ft. from 46,900 sq. ft., to house about eight theatres. Brockhoff also said restrictions on times of late night films are possible, with an increase in security for activities detrimental to the village.

Announcing he is an engineer, Airoso community action committee member Dean Dubey and his wife, Karen, read a recent homeowners’ letter accusing Pardee of a “bait and switch tactic,” decrying what was perceived to be Pardee’s “master manipulation of public opinion,” complaining that homeowners were not initially informed of the cinema, and insisting on an explanation in writing from Pardee regarding any deviations from the sub-area plan.

Would the residents themselves like to be able to walk across the street to a movie? “In your heart of hearts, would [the cinema] increase the value of your homes?” asked one audience member. Regional issues co-chair Anne Harvey responded to some residents’ fears that movies would distract students from an adjacent school, saying that students mixing with the community and mingling would be a good idea, rather than isolating them.

Board member Gary Levitt agreed, recalling early plans for the Del Mar Highlands shopping center where “neon tubes stood out like UFOs. We have a school next door (to the mall) where kids hang out. In reality, you know where your kids are. It’s better than having to drive them. It’s better for me as a parent to know where my kids are. It’s a real center for the community. I want to own across from a shopping center so I don’t have to get into my car.”

In this latest revision, Pardee redesigned the village square to provide more lawn area and water features, rotating a building at the southern end of the village square so that it is more parallel to Village Loop Rd. A tower has been re-aligned along the side and not center, of the square, and trellises were added to screen the high school to the south. Commercial uses are designated for the ground level, with residential units on the third and fourth levels added without increasing the height of the buildings.

So, it is now a more comprehensive design with residential units above and a revised plaza design, with residential placed behind the movie theatre. To the northeast, a traffic light will mark a busy intersection, Shaw said.

Pardee has agreed not to disturb private developments on the northern edge of the village center, and to work on a deal with those developers to create a pedestrian walkway with a sidewalk or connector to the village center. Chair White suggested those developers put their plans on paper and make sure that pedestrian link is there. Brockhoff said Pardee would be happy to work with the Gonzales family development to the north on the link.

Senior city planner Bernie Turgeon has said the site’s objective is to be pedestrian oriented and a new urban plan with entertainment uses, not only for shops and errands, said boardmember and PHR resident Patti Abramson. The idea is to have town homes on all sides of the theatre to provide eyes for security purposes. “Bernie said he is still concerned about the width between buildings so that it will not look too narrow and will provide pedestrian movement,” regional issues co-chair Jan Fuchs commented.

Scott Tillson liked the “European approach” adding two levels of residential units and revitalizing the area during the evenings. “It’s a good idea to keep traffic and customer pattern away from residences. By and large, I’m pleased with the changes you made; it reflects well on the project.”

Less wide than a city street block, the 50 to 65 ft. wide village central corridor will provide room for people sitting outside, yet will still be wide enough for the fire dept. to access, said Shaw.

As for a completion date, “Our timeline will be a little bit aggressive next year,’ Brockhoff said, constructing a 43,000 sq. ft. specialty grocery but only 7,000 sq. ft. (or one-half) of another retail building will be built next year. Completion is slated for 2013, the ‘best scenario.’” “The bottom line is, everything is in phases,” said chair White.

An EIR was prepared that reflected this overall project and the city has looked at the traffic generated, Shaw said. Asked about revenues generated or finance costs, Brockhoff said they are “difficult to peg” so far away from completion, adding, “We are a very private company.”

Homeowners concluded, “No board member should vote for this plan. We expect Pardee to deliver what was promised.” A homeowner dissented at the end of the debate, however, saying, “Kids have no place to go; a bookstore won’t do it. We need alternatives that are youth friendly.”

“It’s a good site plan,” said another resident who approved of the project’s scale, mixed use and cinema. We need to have a place where teenagers can go out at night, walk to restaurants, Trader Joe’s, etc. The cinema is a key in bringing people here.”

“I love this project,” vice chair Ken Farinsky said. “If it were in (our

Carmel

Valley) community, yes, I would approve it,” dependent on establishing good pedestrian links between adjacent developers’ properties.

White suggested continuing until December or January discussions of the village at the community rather than city level to make more people aware of the project since there is “such a community-wide non-support of the project.”

But, would weeks or months of debate make a difference? Brockhoff said even three more months of discussion “might not delete the cinema. We strongly believe this plan follows the sub-area plan of the 1990’s,” he said, approving of the way pedestrians can drive into the heart of the village and then walk everywhere else. “We designed [the village] to the intent of the planning document. I have a say in the decision process; we want to develop our land to its highest and best use.”

Brockhoff intends to submit the plan to the city for their input. “At the end of the day, we need to get the city’s endorsement.”

On Tuesday evening at the Carmel Valley Planning Board meeting held at the Carmel Valley Public Library, there were many items on the agenda, but 90% of the seats were filled by residents of Pacific Highlands Ranch eager to learn about and discuss the proposed Pacific Highlands Ranch Village Center. The Village Center is a 26.67 acre development site with approximately 290 residential (Condo) dwellings (mixed affordable and market-rate) and 215,000 sq ft of commercial space and 18,000 for a library. Although the plan and intention is for all 290 units to be “for sale” condo units, it is possible that it could change to rental apartments. On the side of the development closest to Carmel Valley Road, there is a planned 50,000 square foot of commercial space reserved for a “specialty grocer” such as Trader Joe’s, Henry’s, Jimbo’s, etc. taking up 35,000 sq. ft. and the remainder for other commercial space.  This portion of the development will likely be the first area to be developed and is the only part of the PHR Village

Center that can be built prior to the “flyovers” being constructed at the East Route 56 to North I-5 connector (scheduled to start no earlier than 2013).  That means the 50,000 sq. ft. could be completed as early at 2010.

Following last month’s Carmel Valley Community Planning Board Meeting, Pardee made three significant changes to the overall site plan.  These changes were in response to requests and suggestions by mostly Airoso residents as well as the Planning Board.  These included:

1. Changing the height of the residential buildings that are closest to Airoso and Village Loop to 2-story rather than three or four stories.  Pardee did make the change and the condo units now increase in height gradually from two-story initially to four-story at the most interior location.
2. 
   
   Village Square/Main Street – the main pedestrian street down the middle of the development has a commercial building at the end.  Residents and the Board requested that this be moved and rotated out of the way of the views to make this less noticeable and prominent.  Pardee successfully made this change to the satisfaction of the Board and residents.
3. Proposed Cinema – At the previous meeting Airoso residents expressed their concern about the cinema.  In response, Pardee has reduced the size of the cinema from 46,900 square feet to 35,000 square feet, which is a reduction of approximately 25%.  The Board was pleased with this change.  Airoso residents are (in general) still opposed to the cinema entirely.

Following some discussion, Airoso made a thorough presentation of their position which included a petition/survey that they reported showed 94 of 102 total respondents against the cinema. This survey included Airoso, Portico, Arabella and Santa Rosa.  Suffice to say, there’s some strong opposition amongst those that voted. Unfortunately Bordeaux and Soleil at Bordeaux were not included in the survey or the Planning Board discussion. One of the main complaints in addition to the cinema was that the cinema plan was never communicated properly to the residents of PHR.  As a result of their presentation, the Board voted to table the matter for 90 days to allow ALL residents of Pacific Highlands Ranch to review and learn about the Village.

So, now it’s up to residents of Pacific Highlands Ranch to come together and work with Pardee to review and discuss the plan.  We have 90 days to arrange a meeting or “Town Hall” meeting.  I’ve volunteers to help coordinate this with Pardee and possibly the principal of Canyon Crest Academy for use of one of their facilities.  If you would like to help coordinate a Town Hall meeting for this topic, please post a comment here or email me directly to discuss. sold@route56homes.com

Last night the proposed Pacific Highlands Ranch Village Center was again a topic of discussion at the Carmel Valley Planning Board Meeting.  The meeting was well attended by concerned residents, especially from Airoso, the Standard Pacific - built townhomes that border the Pacific Highlands Ranch Village on Village Loop.  Other neighboring communities within Pacific Highlands Ranch that would be directly affected by the construction of the Village Center are Arabella, Portico, Santa Rosa, Bordeaux and Soleil at Bordeaux.  Present at the meeting to re-present the building plan were representatives from Pardee Homes and Lattitude 32.

Pardee and Lattitude restated the primary concerns which were originally voiced on September 11, 2007.  They included first a concern over the existence, size and location of the proposed multi-screen cinema.  Second, concern over the size and presence of residential condos planned for corner closest to the entrance of Airoso.  Third, a question of whether the parking structure would be too large and imposing.  And finally, there was some concern that a commercial building proposed at the end of the main pedestrian walkway would limit views to the South.

Since those concerns were voiced, the plan was adjusted to accommodate some of those concerns.  And after hearing addition comments last night, the Planning Board was able to provide Pardee and Lattitude 32 with some recommendations After nearly two hours of discussion, Board questions, resident input and more, there were some outcomes and recommendations that it seemed the majority of the rooms was happy with.

 With regards to the cinema, Pardee has agreed to look into making three important adjustments: 1) reduce the size of the theater from accommodating 8 screens to something close to 4-6 screens; 2) controlling or adjusting the operational hours of the cinema to limit very late night use and high volumes of patrons leaving all at once; and 3) implementing increased security measures - perhaps involving on-site guards and/or cameras.

The concern over the appearance of the condo at the NE corner of the Pacific Highlands Ranch Village was mostly centered around the initial condo building being 3-4 stories and being overwhelming and ominous compared to the 2-story Airoso townhomes.  Pardee has agreed to explore lowering the height of the first (and most visible) row of condos to 2 stories or perhaps varying it from 2-3 stories for better visual appeal and to “soften” that corner.  The 4-story buildings would be shifted to the interior of the plan to be less visible.

 Pardee and Lattitude explained that the parking structure (4 stories above ground) would not be visible “line of sight” from within the Village and most seemed fine with the explanation in conjunction with the visuals on hand.

The final issue of the commercial building at the end of the pedestrian Village area was difficult to tackle because so much of it depends upon what is built around it and trying to imagine how it will look in the end.  The Board mostly did not seem to have a problem with the structure, but did suggest that it be architecturally compelling and interesting since it will be so visible.  They also suggested that the grassy area near there be enhanced, but with an “urban” sense about it.  It’s not intended to be a place to go play ball, but rather a gathering place to families to enjoy.

 In all, it was a good meeting that never got too heated and at least from appearance, most of our concerns were addressed or will be addressed.  The next and possibly final revision of the plan will be presented most likely at the November Community Planning Board meeting in Carmel Valley.

 As a resident of Pacific Highlands Ranch myself, I and my family are excited about the presence of the Village Center.  My only comment at the meeting was that I feel that having a Cinema or something similar is critical in creating a Village Center that is a destination, not just a place to shop and leave.  We don’t want it to become a transient center similar to Piazza Carmel.  I believe we need a place where we as residents can walk, stay and enjoy; and with the current plan and revisions, it looks as though that’s what we’ll get.  It’s important for us all to stay involved in the process though to ensure that we protect our interests and help make this community safe, friendly, usable and a joy to be a part of. 

I welcome your comments on the meeting, the Pacific Highlands Ranch Village Center or anything else that you’d like to bring up.

 I spend quite a bit of time analyzing and understanding the real estate market and economy we are experiencing today. What I’ve found is that you can’t always believe what you read.  You really have to study the fine print and understand the context of the facts and figures you are presented with.  As Gregory Smith, San Diego’s County Assessor pointed out, although foreclosures are up significantly in percentage, the gross number is still a tiny percentage of the total home owners… and many of those are timeshare foreclosures, not single family homes.  The article below by Alan Nevin helps put some perspective on our market.  Remember, newspapers won’t sell if the headline reads “Everything this is OK!” - they need to sensationalize the facts to keep selling papers.

Psychology, shakeout of speculators slowing regional real estate market, not economy August 18, 2007 

Written by: Alan N. Nevin, a director of economic research for MarketPointe Realty Advisors, a San Diego firm that analyzes the real estate market. He is also chief economist for the California Building Industry Association.

These are strange times we live in, especially if you are in the business of studying the San Diego housing market. The last time we had a really serious cutback in housing demand was in the early 1990s. At the time, we were in a national recession, General Dynamics decided to leave town, the savings and loan associations folded, and the construction industry went silent. The construction industry went silent because it needed the S&Ls to fund it. From January 1990 to mid-1993 the county lost 50,000 jobs and the unemployment rate increased from 3.9 percent to 7.6 percent. It was a miserable time for the local economy. 

Now compare that to today. We have been gaining jobs steadily since 1993. Since then, the county has gained one-third of a million jobs. And not just hamburger flippers. Since 1993, we have had a massive increase in high-paying jobs relating to telecommunications, biotech, biomed, manufacturing, financial services and health care. And the unemployment rate is back down to just over 4.0 percent. Despite the cutback in construction jobs locally, total wage and salary jobs have increased by almost 20,000 in the past year. In fact, according to the state’s Employment Development Department, if you exclude the 5,500 jobs lost in construction, our net employment would be up more than 25,000 jobs in the past year.  I should point out that the construction industry has four components: new residential, new commercial, infrastructure and residential and commercial remodeling. The new residential construction component is in a funk, but the rest of the construction industry is on a roll. Thanks largely to the bond issues we passed recently, the infrastructure industry (including roads, schools and hospitals) is well set for massive employment gainsover the next decade. 

So why is the new housing construction and the resale housing market sagging? Well, first at all, every time somebody buys a new house, approximately four persons buy a resale.Thus, when the home-building industry is not doing well, the resale industry suffers as well.  And, of course, the major puzzle is: If the economy is expanding by 20,000 jobs a year, why isn’t the homebuilding and resale market booming? I think the answer has to do with psychology and consumer confidence. We can’t blame it on the woes of the financial industry, because the sagging real estate market started long before there were money troubles. I think the real answer is that at some magic moment in 2005, potential buyers looked at the highly aggressive pricing of home sellers (new and resale) and said to themselves: “That’s enough. I won’t pay these silly prices and I’m going to wait until they return to some form of normalcy.” And that is exactly what potential buyers are doing. In other words, it has nothing to do with Econ 101 and supply and demand. The basic demand is still there because, like everywhere else in the nation, the American Dream is to own a home. On the other hand, the dream doesn’t include payments that are destructive to one’s lifestyle.  So what we are clearly seeing now is a back-off from the silly prices of 2005. Where does that leave the folks who bought in 2005? Unfortunately, a number of those folks probably shouldn’t have taken advantage of funny money loans and didn’t have the FICA [or credit] scores to support traditional loans. From a macro-economic standpoint, this county has 750,000 homeowners. A relatively small percentage of those homeowners bought in the crazy days of 2004 and 2005. And a smaller percentage yet had the silly loans. In 2007, as many as 7,000 households will lose their homes to foreclosure, less than 1 percent of the total owners. Now that doesn’t mean that the 1 percent will not be devastated by their losses, but it does mean that 99 percent of the population will muddle through. After all, almost one-third of the homeowners in the county own their homes free and clear, and the average loan to value in the county is 75 percent, so most homeowners are doing just fine. Hopefully, you’re among the blessed. What does it take for the market to correct itself? Primarily it takes a renewal of confidence and most probably a dose of optimism from the local press. In the economics of recovery, we have learned over time that

San Diego is a “V” economy. That means that when the potential home buyers decide it’s time to buy, they do so with a vengeance.  Most other markets are “U”-shaped, which means that they recover slowly. Now the puzzle gets more complicated because the supply of new housing is fading rapidly and builders are not processing a sufficient number of lots to allow them to supply the market when it turns around.As you may have noticed, we do not have many acres left for single-family construction. In fact, in North

County, the number of new master-planned communities being prepared for development is fast approaching zero. Further, a number of the bigger builders have left town, probably for good, because they cannot obtain a sufficient number of lots to produce reasonably priced single-family housing in volume. Further, they inherently know that most San Diegans are not prone to live in high-rises, particularly in the suburbs. Therefore, what we do know is that when the market turns around and the potential buyers come out in droves, the supply of product will not be there. We also know that prices have declined somewhat, but that contrary to several devastating projections by the Eastern press, home prices are not going to drop 40 percent, or 30 percent or 20 percent or even 10 percent. In the recession of the early 1990s, the average home price declined only 5 percent. Today, we know that few people list their homes unless they have to, so the inventory of unsold homes is relatively modest. What we also know is that the vast majority of homes going through foreclosure are of lesser quality and often in need of major repair and renovation. There are fewer homes listed for sale now than there were at the peak of the boom in 2005. And the inventory of new homes has plummeted. Currently, countywide, there are fewer than 6,000 new units offered for sale and 2,000 of them are condominium conversions. And in case you think the market is completely dead, please note that in the first half of the year, local developers sold more than 4,500 units. Of those, 1,600 were single-family homes averaging more than $800,000, and 75 percent of them were in North County. And this year, we will sell more than 20,000 resale homes countywide as well. So there you have it. If you are a potential home buyer, you have the opportunity to play Russian roulette. The game is simple. You try to guess when the housing market is going to be at the bottom of the “V.” If you miss by a few months, you’ll wind up paying a lot more than you can get a home for now. And you also realize that homes are to live in, not bet on.Article provided by: California Title Company

New housing developments open up connections between Carmel

Valley, Rancho Pe

ñasquitos and Rancho Bernardo June 23, 2007

New developments are a double-edged sword for the driving enthusiast. As much as we might dislike subdivisions taking over what was once grazing land, the new developments also open up some beautiful vistas and create some nice roads. One such area is west of Rancho Peñasquitos where the Del Sur community is under way. Wandering around in new home developments is what got me started in day cruising. When I was a kid, we’d pile in the ‘56 Chevy (or later, the ‘64 Pontiac Catalina) and go for a drive on Sundays. My dad would follow the flags to the new developments, then we’d drive slowly along the street, checking out the homes. It was exciting when the poor souls living there hadn’t yet put up curtains and we could peek through the windows and see all the packing boxes. Well, it was a fun Sunday for us, at least. Perhaps because I was driving a new Dodge Avenger R/T for the week (the spiritual heir to another one of our cars – a ‘75 Dodge Dart), I headed to an area just becoming open between Interstates 5 and 15 on a mission to find some interesting new roads that would be appropriate driving for a family sedan. So, today’s route will follow an old country road, a new span with beautiful vistas and end in one of our favorite family drive areas, Rancho Santa Fe. Start on that “new town” road, state Route 56, which runs from I-5 near Del Mar, through Rancho Peñasquitos and ends at I-15 and the Ted Williams Parkway in Carmel Mountain Ranch. Exit at
Carmel Valley Road, which at one time was a country road, dirt in some places, and the only public east-west thoroughfare in the area. It’s all paved now, and its new connection to Bernardo Center Road is expected to be opened this summer. Choosing to enter the area on
Carmel Valley Road puts drivers on a small segment that reflects the old days: a narrow two-lane highway where there’s still a nursery or two and views of a farm – at least looking north. Look south, and you’ll see tract homes that seem to completely fill their lots. Heading north on Camino del Sur takes you to one of those areas that most folks don’t know exist, what the city of San Diego’s Planning Department once called the Black Mountain Ranch. First up is the Santaluz neighborhood, which appears to be pretty much built out. Homes dot the rolling hills, and much of the area has been preserved as open space. This is a fairly rugged area, which is one reason it took so long to develop. The road is only two lanes in most areas, will be widened at some point to four and might include a monorail system, according to Fred Maas, president of the new development to the north, Del Sur. Continuing north from Santaluz, Camino del Sur has gentle curves and an impressive crossing of Lusardi Creek at the southern edge of Del Sur. There’s a cul-de-sac viewpoint that offers great vistas to the southeast, where a cut and pair of bridges for the new Carmel Valley Road are visible. I ran into Maas at Del Sur’s Ranch House, a new, old-looking building (constructed with recycled beams and other reclaimed materials) that is the gateway to the 4,677-acre development. Plans for the Lusardi Creek area aren’t finalized, but some of the hills are to remain undeveloped; 60 percent of the area will be open space. And by the way, homes start in the low $600,000s, a bit more expensive than the new developments in Clairemont, Escondido or

San Carlos we saw on those long-ago family drives.

At

Maas’ suggestion, I had lunch at Brett’s Barbecue, 10550 Craftsman Way, in the 4S Ranch retail center. It was worth the drive a few minutes north, as my pulled pork sandwich and cole slaw were mighty fine. Continue on Camino del Sur, which runs into Camino del Norte, and you’ll see the center on your left. It includes a Ralphs market (fitting, as the Ralphs family once owned the land) and an assortment of stores. If barbecue isn’t on your menu, the first U-turn after crossing Lusardi Creek is at Paseo del Sur. Retrace your route south on Camino del Sur. Maas said this road opened in mid-April and it appears drivers from Rancho Bernardo haven’t found this shortcut to state Route 56 and I-5. It won’t take them long. A turn north was made at San Dieguito Road, which heads into Fairbanks Ranch. Not long after the turn, there’s a small parking lot and hiking trail entry to the Black

Mountain

Open

Space

Park. This is the northwestern corner of the park, which stretches all the way to where I-15 and state Route 56 meet. There’s an extensive trail network. (The map is online.) An exclusive community with a colorful past, Fairbanks Ranch was the getaway for silent-screen stars Douglas Fairbanks Jr. and Mary Pickford in the first half of the 20th century. Much later it was home to the equestrian events in the 1984 Olympics. Today, exclusive estates are tucked behind a guarded gate; I didn’t attempt passage. There’s a small convenience center with a restaurant at the corner of El Apajo and San Dieguito Road, but the only thing open there on a Sunday was the Farm Fresh Market. All of these roads were quite pleasant in the Avenger and would be nice in any car, including our old family sedans from the ’50s and ’60s. Continuing to Via de la Valle and after the right onto Paseo Delicias to follow county highway S-6, don’t miss the left turn onto El Camino del Norte. On the Sunday I visited, there wasn’t much traffic on S-6, but it can be very busy. Of course, Rancho Santa Fe is one of the most exclusive communities in the nation, with its rolling hills and rambling, mostly Spanish-style homes. The prime property is within what’s called the covenant area, where the Rancho Santa Fe Association reviews design features of a home and also keeps an eye on the grounds. After passing through Olivenhain, then it’s over the hill on Leucadia Boulevard to I-5. Progress chews up open space and creates places for San Diegans to live. Hitting a development in its early stages can make for a fun and eye-opening trip. Any excuse for a cruise through the area is worth it. This article is credited by: Jack Brandais, a

San Diego freelance writer.