Scammers can file a deed to transfer a free-and-clear property (no mortgage), and then convince a bank to give them a cash-out refinance. (LINK) It’s surprising that it doesn’t happen more often!
With many wondering whether the Chargers are leaving Qualcomm Stadium for Los Angeles, San Diego’s other major sports venue — Petco Park — has become the subject of a bizarre ownership controversy sparked by a mentally ill man who filed a simple document.
Derris Devon McQuaig took legal title to the downtown ballpark away from the city and the Padres two years ago by walking into the San Diego County Recorder’s Officer and submitting a properly filled-out deed transfer.
Seriously.
County and city officials have been quietly trying to remedy the situation ever since, but a felony fraud case against McQuaig was dismissed last week after a judge ruled he’s not mentally competent to be prosecuted.
Because no actual sale or transaction took place, government officials and real estate experts say there’s essentially no chance of McQuaig taking control of the property, which was recently appraised at $539 million and is slated to host its first All-Star game in July.
But McQuaig has created a legal and bureaucratic nightmare that could be perpetrated on any property owner if someone decides to target them by casting doubt on their title in this way.
Jeff Olson, chief of assessment services for the San Diego County Assessor’s Office, said county officials are required to record all properly submitted documents and make them part of the public record even when they are obviously bogus.
“I don’t think in any way it would be deemed credible because it’s pretty clearly just a ‘wild deed’ that has no legal sufficiency,” Olson said. “But it could cause headaches for someone down the road.”
Those headaches, which some compare to being the victim of identity theft, include hassles and delays in trying to sell or refinance property.
“If the report shows that this goofball over here put his name on your property, the bank is not going to lend you money,” said Tracy Leonard of Lawyers Title Insurance in Mission Valley. “It’s still your property, but you have to clean up the mess that somebody else made.”
Zillow is already one of the primary real estate portals for consumers. Though there are rumblings from realtors about mounting a challenge, it’s unlikely that anything will topple the Z-brand in the short-term.
As a result, we increased our Zillow advertising this month.
Not only do we expect that more consumers will be using the tools there – but it also seems inevitable that Zillow will develop additional ways to promote their agent-customers too.
I’m not a big believer in anecdotal evidence in the real estate business. There are too many random events – and sales – created out of dumb luck that you can ever draw many definitive conclusions.
But after not getting any new Zillow inquiries during the previous 3-4 days, I received THREE buyer inquiries on Christmas Day!
There has to be pent-up demand in the marketplace. It doesn’t guarantee that buyers will pay higher prices, or even buy at all. But I’m guessing that the streets will be full of lookers in the coming weeks. On Wednesday – just two days before Christmas – I ran into the second 4-offer bidding war of the week!
I think the heightened activity will cause sellers to add even more icing on the cake – leaving a beleaguered buyer pool with tough choices. Either bite the bullet and pay the highest price ever, or wait and see.
It will show up differently in different areas.
In neighborhoods where we see a surge of still-somewhat-reasonably-priced listings, the market will look like it’s on fire as waiting buyers gobble them up. Other areas will look more stagnant than ever (like RSF, which has 25% of the NSDCC active inventory but only 8% of the closed sales over the last 30 days).
My advice to buyers and sellers?
Don’t over-think it – get in, get out, and get on with life! Don’t let the desire of grinding out the last couple of percentage points get in the way of moving.
The Z Group is probably smart to talk in generalities and just spew the usual stuff about next year – higher prices, tight inventory, and less affordability. They even dropped a ‘priced out completely’ about those in the bottom-third-of-incomes category.
One thing they mentioned that the industry needs to stop saying:
“Qualifying for a mortgage can still be extremely difficult.”
The underwriting guidelines are standard, not difficult – one size fits all, and either you fit or you don’t. Buyers can find ways to fit – if you are self-employed, you can stop taking so many write-offs for one year only and get a Freddie Mac loan.
Three Zillow predictions for next year:
Affordability will be a major issue in the 2016 presidential election.
Rents will set new records in 2016.
The consensus of the 100+ experts they surveyed was 3.5% appreciation
There isn’t much any politician can do about un-affordability except give houses away, which I guess is possible. It’s hard to believe anybody could make a solid case that they deserve to be elected because of their housing policy, so I doubt it will come up much.
Rents around the coast will probably set new records next year.
The 3.5% appreciation kick is probably the safest number available, especially if they are talking about a national stat. It will probably range from -5% to +15% depending on the local area, so 3.5% is comfortable.
In the video below, the economist reiterates that the inventory is so low that there aren’t any houses to buy – that the ‘shelves are bare’.
It is the view of the casual bystander.
This is the new normal – a market for serious participants only.
Buyers have to be grinding day in and day out, and be willing to kiss a few frogs before finding the right house. Sellers have to be sharp on price, and smartly tune up the house prior to listing in order to make a good first impression.
The confluence of those two groups make for a very active marketplace. We’ve already closed more NSDCC sales this year than last year, and the 2015 total will easily end up well over 3,000 sales:
Year
# of NSDCC Detached-Home Sales
Avg. Days on Market
2011
2,562
85
2012
3,154
80
2013
3,218
50
2014
2,849
51
2015
2,934
49
Why does it appear that there is no inventory? Because sales are happening at a rapid pace – 38% of the NSDCC houses sold this year found a buyer in the first two weeks.
An example: A new listing hit the market at the end of last week, and our ready, willing, and able buyer with a 20% down payment made an offer. By Monday the listing agent had received four offers – two were all-cash, and one of those was over list price!
During the week of Christmas!!
The potential buyers who only check in occasionally will miss the hot buys – they don’t have their chops up enough to recognize them, and instead just see the over-priced turkeys that have been picked over by everyone else. Casual seller-candidates will see the same, and think adding the extra 10% is a good idea – just in case.
The talking heads are wondering if the 10.5% month-over-month drop in existing home sales is related to the new TRID mortgage regulations. Those with a national voice are usually quick to blame everything but prices for any glitch in the statistics. The M-o-M decline is normal (see above) due to the holiday season, and because there are two fewer business days in November.
It would serve the real estate consumer well if there was more focus on how prices affect sales – and that price will fix everything! Let’s hand it to Yunnie for including that ‘the steep rise in prices’ could be the cause too!
NAR economist Lawrence Yun said most of November’s decline was likely due to regulations that came into effect in October aimed at simplifying paperwork for home purchasing. Yun said it appeared lenders and closing companies were being cautious about using the new mandated paperwork.
Also potentially weighing on home sales, the median price for a U.S. existing home rose to $220,300 in November, up 6.3 percent from the same month in 2014. Yun said the steep rise in prices and shrinking inventories could also be constraining home purchases.
How did we do around North San Diego County’s coastal region?
Typically we have a drop in sales from October to November, but this year we fared well, compared to the last two years:
Year
October Sales
November Sales
Diff
2013
266
187
-30%
2014
244
172
-30%
2015
215
187
-13%
December is usually a good month too, and we’ve already closed 156 sales – last year’s count was 250, and the year before we had 211 December sales.
The market will be great, as long as sellers adjust their sails to the wind.
The numbers are staggering: Annually, $1 trillion is stolen by corrupt officials from countries around the globe.
That money needs to be spent, or laundered, and much of it goes into big, anonymous real estate deals in the United Kingdom, which is seeing $1.5 billion in unrecorded capital inflows per month.
The main source of that money? Russia.
From Russia with Cash, a new documentary that aired at the Newseum in Washington, D.C., on December 15, focuses squarely on the phenomenon. It examines up close British real estate agents’ willingness to overlook a deal’s potential illegality in the hopes of a big commission.
Wearing hidden cameras, Russian government minister “Boris” and his blond girlfriend “Nastya” tour five palatial apartments in central London, accompanied each time by a different real estate agent.
The movie captures the interactions. We watch Boris buttonhole each realtor to confide that he is a government minister with a “very small salary,” adding, “Needless to say, the money for this flat comes straight out of the Russian budget.” He explains that his name cannot be connected to the property in any way.
Despite having just heard that their client is a crook, the agents invariably continue the deal. Several refer him to a lawyer; one says, “You shouldn’t be telling me anything about any of these things,” but doesn’t cut the conversation short.
In the United States, that behavior is fine: real estate agents in the United States aren’t obligated to report on clients whose legality is in question. But in the United Kingdom, an agent who thinks a potential client might be laundering money illegally is required by law to file a Suspicious Activity Report (SAR) with the country’s National Crime Agency.
In the film, the agent showing the ritziest apartment—an ornate, five-bedroom flat selling for £15.8 million (and potentially fetching a £315,000 commission for the agent)—does seem to have second thoughts after Boris’s speech; there’s a moment where it looks like he might turn the Russian down. But then he says, “No one will find your name on this,” and proceeds to explain how that can work.
None of the deals go far beyond the initial conversation, but the film is a powerful, if repetitive, illustration of how corruption flourishes. Corrupt officials from around the world need safe places to park their money, and real estate deals are currently the vehicle of choice—as long as the bureaucrats’ and oligarchs’ names can’t be traced to the purchases.
Last Monday, the 30Y rate was 3.98%. The Fed made it official on Wednesday, and the 30Y rate initially jumped about 20 basis points. But by Friday afternoon we were back down to 4.02%.
The local NSDCC new listings keep coming; 51 in the last seven days which is about the same as in 2013. With Christmas being so close, you might think that the bulk of those are just listings being ‘refreshed’.
But only 11 of the 51 had expired or cancelled within the last 30 days, and then relisted by the same agent over the last week.
We’ll see a boatload of ‘refreshings’ during the first week of 2016 – watch out.
Click on the link below for the complete NSDCC active-inventory data:
