I am very excited that MetroList (our local MLS) now provides wonderful reports to help us better understand what is happening in our local market. Land Park and Curtis Park are two of the neighborhoods I specialize in so I thought I would share the information from MetroList for your perusal. Enjoy!

COME OUT, COME OUT, SHADOW INVENTORY!

April 8th, 2009Carolyn Said, Chronicle Staff Writer"A vast "shadow inventory" of foreclosed homes that banks are holding off the market could wreak havoc with the already battered real estate sector, industry observers say.""We believe that there are in the neighborhood of 600,000 properties nationwidethat banks have repossessed but not put on the market, "said Rick Sharga, vice president of RealtyTrac."

May 19th, 2009Blog posted by Peter Coy"A new survey from Zillow.com confirms what I've been saying for months: There is a huge amount of "shadow inventory"in the housing market. Except the shadow is even bigger than I imagined." According to Zillow's VP for data and analytics, Stan Humphries, "Almost one-third of homeowners (31%) said they would be at least somewhat likely to put their homes on the market in the next 12 months if they saw signs of a recovering real estate market...We here at Zillow expect to see a long, drawn-out bottom, with any upward bumps in value tempered by new inventory coming into the market."

July 21st, 2009Real estate news and analysis from the Wall Street Journal"...there are some signs that banks may be delaying foreclosures, either because they're overwhelmed with a glut of delinquent loans or because they're strategically holding off on over saturating the market. That so-called "shadow inventory" could lead to an uptick in foreclosure listings later this year."

August 2nd, 2009by CalculatedRisk, lifted from the comments on Corus: "Too toxic to fail" by Rob Dawg"On shadow inventory from Reuters: "Shadow" inventory lurks over U.S. housing recovery[A] massive supply of unsold homesis waiting in the wings and could easily swamp the recovery before it can gather speed. The number of homes listed officially on the market, while still at historically high levels, might be only the tip of the iceberg: said Stan Humphries, chief economist at real estate website Zillow.com in Seattle, Washington."

September 30th, 2009Quoted from Henry Blodget, CEO and Editor-in-Chief of The Business Insider"Amherst Securities has produced a scary analysis of this "shadow inventory" overhang, which Amherst estimates is a shocking 7 million houses (The consensus is only 2-3 million). 7 million houses represents 1.4 times the number of houses currently sold in the country each year. So this represents a massive overhang. As these houses hit the market in future years, they will keep pressure on house prices. This will likely either lead to further declines in prices or delay the recovery."

October 13th, 2009from Homefront by Jim Wasserman and Dale Kasler"There is no massive shadow inventoryof bank-owned repos - and banks aren't intentionally holding them off the market. So says Foreclosure Radar's Sean O'toole."

October 15th, 2009Written by Eric Wolff"There is no shadow inventory; there is no bank conspiracy; there are not houses waiting like vine-ripened tomatoes for the moment to be plucked, says a recent report from ForeclosureRadar, a prominent data-tracking firm."

I offer these quotes from various sites to show the progression of the "shadow inventory" issue. What I found fascinating is the wide variance of opinion. Experts in the field can't agree, any more than the numbers that support their opinion. It seems to me, if they have been predicting this "glut" of homes to come on the market since (at the very least) the beginning of the year, and it hasn't happened, it might be time to question the reality of "shadow inventory". Interpret it as over-reaction, misinterpretation or simply wrong, the "shadow inventory" has yet to appear. Contrary to popular opinion and strange as it may be, we in Sacramento have more demand for foreclosures than we have foreclosures to sell. It is common to have many multiples of offers on each foreclosure. Foreclosure buyers have become accustom to the rejection of their offer - even when it offers over asking price. I, for one, do believe in fairy tales...and maybe this is one of them!

SOLD QUICKLY AT FULL PRICE...DARN IT!

When setting a listing price for a home, accurate information and evaluation of that information is critical. The nuances of the neighborhood, knowledge of the comparable properties, current issues facing homeowners and buyers all come into play when setting a market value of a property. Realtors carry on a thorough discussion with their sellers, explaining all of the factors that affect their home's value. The discussion can take the tact of why the property is worth more than the sellers thought, but more often than not, the Realtor is explaining why it isn't valued at the same amount that the sellers thought. Of course, there is an emotional tie for the sellers...fond memories and endearing features of the property that add value for the present homeowners, but are simply a perk for a buyer. So, after long deliberation, the Realtor and property owners come to agreement on an acceptable listing price.

However, does the Realtor have the same discussion on the seller's expectations after the property goes on the market? For the Realtor, an ideal situation would be the property selling in a reasonable amount of time at very close to asking price. From a seller's perspective, receiving an offer too quickly and at asking price translates into not asking enough for the property. When the property is listed, it is critical to include this conversation. If we do our evaluation correctly, and market the home properly, the property should sell quickly and close to, if not at, asking price. The sellers should not be surprised by an early offer - rather they should congratulate themselves for hiring a Realtor that was professional, knowledgeable and thorough enough to do exactly what the sellers required of them.

SACTO-AN AMAZING SACRAMENTO ASSET!

Even if you are local, you may have heard of SACTO, but not had a clue what they do. Today, the Sacramento Association of Realtors hosted our Finance Forum in which Barbara Hayes from SACTO spoke. She gave us a truly "meat and potatoes" picture of the purpose and success of this organization.

SACTO is an acronym for Sacramento Area Commerce and Trade Organization. Their sole purpose is to bring jobs to the Sacramento area. They are non-profit, non-political in nature and were created out of the

Metro Chamber years ago. They work with the local 26 governments that make up the Sacramento area. How do they stay out of politics, but work with governments? They receive feedback from companies either in the area or contemplating coming to the area. They then provide this feedback to the appropriate governance's. Last year, they were responsible for bringing 1000 jobs to the area.

In a time when there is a definite shortage of jobs, SACTO is busier than they have been in the past 5 years. The "incubation" time from the beginning of talks to actual job realization is about 12 to 18 months, so we should be looking forward to some good times in the relatively near future.

It may be surprising to learn that about 50% of the potential jobs being considered in Sacramento are involved in "clean or green" technology. Nationally, California is viewed as the mecca of green technology and Sacramento, supplying access to policy makers, give Sacramento (both locally and statewide) a strong appeal. We are an appealing location due to several factors: Sacramento's climate is ideal (other states such as Arizona and Nevada are too hot) and our former military bases generate incentives to use their locations. The very thing that has stagnated our economy in this area is also a great asset...the potential work force. Our educational institutions also give us a benefit. University of California at Davis has a globally known expert in wind power. California State University in Sacramento is known for it's "smart" technology, developing smart grid technology opportunities with a 127M dollar grant (the second largest grant in this field). The Los Rios community colleges are committed to developing grad students into green force experts. Sacramento is winning more companies than anywhere else in California.

Our second largest job force is in consumer goods. There are several factors contributing to this fact. At one time, companies were relocating to states such as Arizona, Utah, etc. However, when oil prices went up, the cost of shipping exceeded the benefits of going to those states. Also, a state with 38M people is hard to overlook globally. Succinctly put, we are too large to fail. According to Time Magazine, California will chart the course for the future. According to the magazine, California is the center of innovation and talent.

Locally, Sacramento has a plethora of benefits to offer potential employers. The very fact that our property values have gone down has provided for affordable housing. The

Sacramento International Airport supplies an easy supply line. Our mild climate (a 75 degree average high and a 50 degree average low) reduces cost to companies concerned about high heating and air conditioning costs. Sacramento claims the highest number of intersecting major highways and freeways in the country (Interstates 5, 80 and Highways 50 and 99). This makes transporting of goods cost effective. Our health industry is thriving with UC Davis, the Sutter Health, Mercy and Kaiser. We offer recreation of every sort within 2 hours of Sacramento - skiing (water and snow) snorkeling, biking, running, baseball, soccer, boccie ball...just name it and it is here! One company that came to town discovered windsurfing..and that clinched the deal! We have the highest performing students statewide.

Nestle is presently committed to a 10M dollar investment in Sacramento. By the end of the year, they will have spent 3.5M of that commitment. 70% of the workforce are local contractors. A solar manufacturer from Asia (yet to be announced) will be investing initially in a 150,000 square foot building to be expanded to 300,000 square feet. They will employ 200 people. We are seeing increased interest in China due to their growing wealth.

We have a beautiful and vibrant city...and it is nice to know that others are realizing what

Sacramento has to offer!

BETTY WHITE, SACRAMENTO ZOO & LAND PARK...WHAT DO THEY HAVE IN COMMON?

Many of us remember Betty White as the conniving Sue Ann Nivens in the Mary Tyler Moore Show or the ditzy Rose Nylund on the Golden Girls. However, in the world of philanthropy and worthwhile causes, she is a caring supporter of pets rights.
So, how excited do you think Sacramentans are that Betty White will be coming to the Sacramento Zoo in Land Park to do a presentation at the new "Tall Wonders Giraffe Exhibit Renovation and Expansion Project? Act quickly, because this Thursday, the 5th of November will be the day! Arrive at 4:30PM to enjoy hors d'oeuvres and cocktails and appreciate all that this regional zoo has to offer! To learn more about this event, call(916) 808-8376.