By Cornelia de Bruin

Triplicate staff writer

Although the housing market slowed at year's end, that's a good thing.

Not only is December the slowest time of the year for several reasons, the slowdown indicates a return to a more normal market, according to John DeGemis of Redwood Coast Realty.

DeGemis, a broker, moved here from San Diego about seven years ago because he was tired of telling people there that he couldn't help them buy a home because they couldn't afford one.

andquot;We've slowed down from the last three years, but the last three years were not normal,andquot; said DeGemis. andquot;We're getting down to a more balanced market. It's healthy, not crazy or dead.andquot;

DeGemis said the change reflects a andquot;buyers' market,andquot; but not the type of speed-driven buyers' market from years past.

People now are giving themselves more time to shop for houses, he explained, instead of having to be ready to make an offer on the spot at this same time three years ago.

andquot;We're catching up with the rest of the state,andquot; he said.

Patti Beesler, a Realtor with Ming Tree Real Estate for the past six years, agrees with the assessment.

andquot;We were so undervalued ... we've been in a buy and flip cycle,andquot; Beesler said.

She explained that buyers who pounced on local properties three years ago, people she calls the andquot;first wave,' andquot;bought up everything they couldandquot; and turned it around to the andquot;second wave.andquot;

First wavers doubled their money in the process, as did the second wave of buyers.

Begins to sound like a tsunami, doesn't it?

Two more buying waves bought property from the second group and turned it around to the third and fourth waves, who hoped to also double their money and found that didn't happen.

andquot;The fourth wave didn't get the doubled sale price and is now in the waiting game,andquot; she said. andquot;The people who bought at the end of the frenzy will hold those properties for a long time.andquot;

Calling himself andquot;the eternal optimist,andquot; Kim Schmidt said that people looking for places to live still see the potential of this area.

andquot;People are looking for possibilities,andquot; said Schmidt, director of the Tri-Agency Economic Development Authority. andquot;I think the market will continue to go up, it won't flatten and it might outpace the rest of California.andquot;

As the market steadies in the cold hard light of reality, DeGemis explained, it's important to realize that it was not what it seemed.

andquot;We never had the market, so it hasn't died,andquot; he said. andquot;Now prices have gone up to where people can't afford all (home) prices.andquot;

Even so, DeGemis expects the prices to rise another 5-10 percent.

andquot;We've had homes that doubled and tripled,andquot; he said. andquot;One year they rose 47 percent, another year they rose more than that.andquot;

DeGemis suspects it will be at least four more months before the dust settles.

Most of Del Norte County's new property owners used conventional loans to finance them.

That's a healthy trend, said Ming Tree's Patti Beesler, because it, too, indicates a less risky purchasing method.

While foreclosures statewide jumped during the last quarter to their highest level in more than eight years, Del Norte buyers' finances seemed more stable, the realtors' county statistics indicate.

andquot;Not a ton of people here are in dire straights and the reason is the low interest rates,andquot; said Beesler. andquot;Foreclosures tend to cluster in areas where big companies are cutting back.andquot;

That indicates a andquot;strongandquot; economy in Del Norte County, she said.

Beesler added that Pelican Bay State Prison affects the local home market because it is the largest employer within the county.

Lt. Ken Thomas, the facility's public information officer, said no hiring freeze is in effect overall at the facility.

andquot;There might be a freeze in some departments, but the California Academy in Galt is running right now and we're waiting to get guards that the send us,andquot; he said.

The prison hires people from lists that are generated in Sacramento, where applicants are required to take their required tests.

The downside of over-extending your finances

The foreclosure picture statewide, however, is not pretty.

DataQuick, based in Sacramento, tracks real estate data as recorded in each of the state's 58 counties. A one-on-one comparison of local sales to those statewide is not possible, however, because Del Norte County's data andquot;lags months behindandquot; the other counties, said DataQuick spokesman Andrew LaPage.

andquot;It's the worst in the state for lag time,andquot; he said.

County Clerk Vicky Frazier created a list showing the number of foreclosure proceedings initiated here from 2003-2006. It includes 90 such proceedings.

andquot;That might be above average, but it's still close to normal,andquot; said Kirk Brown, owner of Crescent Land and Title.

He said the last time he tracked the proceedings was in 1985, when the number was much higher.

andquot;That was when a lot of the mills were shutting down here,andquot; he said.

One reason for the difference between state and local foreclosures is that many of people against whom Notice of Default procedures were filed are those who may have taken out andquot;more inventiveandquot; types of loans, according to DataQuick's President Marshall Prentice.

andquot;The numbers last year and the year before were very low because of strong sales and appreciation,andquot; he said. andquot;Also, most defaults occur a year or two after the loan was made ... and then there are those inventive loans that have been made the last few years, where qualifying involves assuming more risk.andquot;

Prentice explained the state is andquot;in the midst of an adjusting market right now.andquot; He didn't think he would know until spring or summer if the number of foreclosures andquot;is ominous or not.andquot;

Most of the loans, according to DataQuick, originated between January 2005 and February 2006 and were about 15 months old.

On primary mortgages, an article posted on the company's Website Jan. 24 noted that homeowners were a median of six months behind on their payments.

On lines of credit, the median for being behind in payments was six months, with the median owed $3,582 on a median $60,000 credit line.

Information about amount of each buyers credit line could not be determined from public records.


December/Year 2006 home sales

As the year ended, 23 properties changed hands for an average price of $286,217.39. Prices ranged from a low of $141,000 up to $500,000.

Properties stayed on the market between 32 and 604 days.

Compare the end-of-year data to that for the entire year, a year that generated $63,879,874 in sales.

During 2006, 251 properties sold for an average price of $254,501 after being on the market an average of 143 days.

Most of the sales involved properties within Crescent City's municipal boundaries, but sales were also recorded in nine other parts of the county.

Those included seven sales in Elk Valley, 13 in Fort Dick and three in Gasquet.

Hiouchi saw five properties sell, Klamath and Klamath Glen three each and Lake Earl seven sales.

Smith River was the second-largest selling area, with 24 properties changing hands, and Big Flat noted one house sold.

SOURCE: Pat Beesler, Ming Tree Real Estate