Attorney ‘Kingside’ concurred with sdbuyer that the California debt-tax exemption mirrors the federal-law deadline, and will expire tomorrow unless something changes:
The California act (SB 401) was designed to conform with existing federal law and both are scheduled to expire at the end of the year. sdbuyer’s link to the FTB site is accurate as far as I know.
I heard that the California legislature was willing to extend if the Feds were going to extend. With a democratic supermajority sounds like it would happen. But who knows with the Fed extension up in the air at this point.
Its the kind of thing that could still happen after the fact, January or February or even later.
Has there been a big rush of short-sales being completed leading up to tomorrow’s deadline? Furthermore, was 2012 the Year of the Short Sale, as predicted?
Here are the quarterly stats for detached-homes sales from Carlsbad to La Jolla (NSDCC):
|Quarter||#Shortsales||Avg. $/sf||#Non-Shortsales||Avg. $/sf||SS% of Total|
There wasn’t a big rush around here as the deadline approached, and the pricing trend is disturbing. The banks have stopped the foreclosure machine – there were 21 REO listings closed in 4Q12, at an average of $345/sf. But banks should wonder if short-selling is the answer, when you compare the pricing.
With potential short-sellers faced with losing out on possible future appreciation, and having to pay high rents if they sell, it seems unlikely there will be much change in the SS count next year.
If the debt-tax exemption doesn’t get extended, then potential short-sellers will have another good reason to not sell. With the California Homeowner’s Bill of Rights taking effect on Jan. 1st, it would be a great time for them to just not pay, and wait.