Saturday, March 10, 2007

Sheriff's Deputy Suspected of Stealing from Homeowners Association: San Diego, California

If they allow a 10% posting, he could use that 20K to bail himself out.
(Thanks to Fred Pilot for the link.)
A San Diego sheriff's deputy is behind bars this weekend on suspicion of stealing thousands of dollars from a homeowners association. Ronald Sakamoto, 44, was arrested by La Mesa police. Investigators said he embezzled as much as $20,000 from the Lake Murray Gardens Homeowners Association. Sakamoto served as the association's treasurer. He is being held on $200,000 bail.

Crisis Looms in Mortgages - New York Times
This is a pretty weighty article.

On March 1, a Wall Street analyst at Bear Stearns wrote an upbeat report on a company that specializes in making mortgages to cash-poor homebuyers. The company, New Century Financial, had already disclosed that a growing number of borrowers were defaulting, and its stock, at around $15, had lost half its value in three weeks. What happened next seems all too familiar to investors who bought technology stocks in 2000 at the breathless urging of Wall Street analysts. Last week, New Century said it would stop making loans and needed emergency financing to survive. The stock collapsed to $3.21. The analyst’s untimely call, coupled with a failure among other Wall Street institutions to identify problems in the home mortgage market, isn’t the only familiar ring to investors who watched the technology stock bubble burst precisely seven years ago.

Troubles Hit Real Estate at High End - New York Times
I realize these folks won't generate much sympathy, but still...

Until now, deep-pocketed Wall Street tycoons and foreign investors benefiting from a weak dollar seemed to be holding up the luxury real estate market even as the low-end fractured. But there are signs that some high-end real estate developers are also being hit by the slowdown.

Friday, March 09, 2007

HOA rules come under attack
Here is an HOA that has banned outdoor recreational activity in the common areas, including the sidewalks, streets, driveways, and landscaped areas. Result: children can't play outdoors. The property manager says they can always go play at the high school. And this isn't even a seniors community. The excuse is fear of liability, but there has never been a suit. The real reason seems to be cranky neighbors who hate the sound of children at play. This is a great example of why there have to be some limits on the kinds of behavioral rules HOAs can impose.

Although Oak Park is known as a family-oriented community filled with children, one neighborhood forbids kids from playing outside and some homeowners are angry. Country Vistas III, a quiet development of about 147 town houses and single-family homes off Oak Hills Drive, is ruled by a homeowner association whose bylaws prohibit recreational activities on common area sidewalks, streets, driveways and/or landscaped areas. There is also a "residents' right to quiet enjoyment" rule. Several residents who have children are frustrated by the regulations, which they see as restrictive and unfair.

Man chainsaws house in two in divorce split - Yahoo! News
This gives new meaning to the term "separate property."

BERLIN (Reuters) - A 43-year-old German decided to settle his imminent divorce by chainsawing a family home in two and making off with his half in a forklift truck.
Polar bears 'thriving as the Arctic warms up' | International News | News | Telegraph
Recall that we were being told the polar bears were dying off by drowning due to melting ice caused by global warming, and it's all our fault. Now an actual count of polar bears shows that they are thriving. In one 140,000 sq. kilometer region, there are 2100 polar bears versus 850 in the mid 1980s. As one polar bear biologist put it, "There aren't just a few more bears. There are a hell of a lot more bears."

But wait! That's our fault too. You see, "mankind's interference in the environment" is to blame.

Do you get the sense that for some people, no matter what happens in nature, it is a sign of impending doom and proof of human-caused global warming?

Thursday, March 08, 2007

United Press International - NewsTrack - Latinos land 2 in 3 U.S. construction jobs
This is quite a concept. What would be the effect of immigration reform on housing prices?

Latinos make up 13.6 percent of the U.S. employment population, but accounted for 36.7 percent of the 2006 U.S. employment growth, a study showed Wednesday. Most of the jobs Hispanic workers landed were in the construction industry, the Pew Hispanic Center said. In fact, two out of every three new U.S. construction jobs went to Hispanic workers, the center said. Hispanic employment increased by almost 1 million from 2005 to 2006, with foreign-born Latinos who arrived since 2000 responsible for about 24 percent of the total U.S. employment increase. Undocumented immigrants accounted for about two-thirds of the increase in recently arrived Hispanic workers, the center estimated.

Wall Street sags on bleak housing view - Yahoo! News
Fred Pilot found this pithy comment from a builder:

NEW YORK (Reuters) - Stocks slipped on Wednesday following a negative assessment of the housing market from a large home builder and a Federal Reserve report indicated some U.S. regions were seeing slowing economic growth. Stocks gave up gains in the last hour of trading after the chief executive of D.R. Horton Inc. delivered an unusually blunt evaluation of the residential real estate market...The chief executive of home builder D.R. Horton said at an analysts' conference that the current year for his company was "going to suck," spurring worries about weakness in housing. "The housing market, which is the weak spot in the economy ... is the main fear of a recession, and the main fear on earnings" growth, said Milton Ezrati, senior economic strategist at Lord Abbett & Co. in Jersey City, New Jersey.

Wednesday, March 07, 2007

Homeowners' Assocaitions -- HB 391 DBPR STUDY
Jan Bergemann tells me that Jeb Bush vetoed a Florida version of UCIOA (see below) for lack of consumer protection. Here's CCFJ's writeup on it. I must say, I went through the so-called Homeowner Bill of Rights document that is supposed to make UCIOA more owner-friendly, and I don't see a whole lot of owner rights. It's like searching for a real piece of chicken in a bowl of canned chicken soup. Compare it with the AARP document drafted by David Kahne, which is a whole lot more aggressive in protecting owners.
Philadelphia Daily News | 02/21/2007 | Dan Gross | Chops sues LaBan
Talk about private restrictions on freedom of speech! Check out this lawsuit in Philadelphia:

A THREE-SENTENCE restaurant review has led to a high-steaks lawsuit from Chops Restaurant (401 City Ave.) against Inqwaster food critic Craig LaBan and Philadelphia Media Holdings, which owns the Inqwaster and Daily News. In his "Or Try These" sidebar to his Feb. 4 review of Fleming's in Radnor, LaBan called Chops, a popular Bala Cynwyd steakhouse, the "Palm on City Line," where he had a "miserably tough and fatty strip steak." However, according to the suit filed by Chops owner Alex Plotkin, LaBan had a steak sandwich minus the bread, not a strip steak. "No legitimate food critic would ever mistake, or compare, a steak sandwich with a strip steak," the lawsuit states. Plotkin, who prides himself on Chops' chops, says in the suit that he had called LaBan about the review and that LaBan had "apologized for the 'confusion,' admitted he did not have a strip steak and 'saw [Plotkin's] point,' but would not publish a retraction in his column."

SB 948 California Senate Bill - INTRODUCED
Here are three new bills introduced in the California legislature pertaining to CIDs. Fred Pilot sent the links and bill summaries. What you have here is mandatory training for BOD members; tightening of open meeting "sunshine" requirements; and a 2% limit on assessment increases for low and moderate income housing. I would expect pretty stiff opposition to these, except maybe the training of board members. How can anybody object to that? It is impossible to defend the current state of ignorance, especially considering the rate at which the California legislature is heaping new procedural rules on their heads.

Existing law requires the Department of Consumer Affairs and the Department
of Real Estate, to the extent existing funds are available, to
develop an online education course for the board of directors of an
association regarding the role, duties, laws, and responsibilities of
board members and prospective board members, and the nonjudicial
foreclosure process.
This bill would, in addition, as of January 1, 2009, require every
member of the board of directors of an association to complete at
least one 3-hour course during every term of office relating to
decisional and statutory law regarding common interest developments.
The bill would require such a course to be approved by the Department
of Real Estate.
SB 528 California Senate Bill - INTRODUCED
The Common Interest Development Open
Meeting Act provides that any member of the governing association of
a common interest development may attend meetings of the board of
directors of the association, except as specified. The act also
requires that notice of the time and place of a meeting be given to
members at least 4 days prior to the meeting, except as specified.
This bill would prohibit the board of directors from considering
any subject matter at a meeting unless the subject matter was placed
on the agenda when the meeting was announced. The bill would also
make technical changes.
AB 952 California Assembly Bill - INTRODUCED
Existing law places
specified limitations on the amount by which the board may increase
regular assessments, and levy special assessments, without a vote
complying with certain procedural requirements. Existing law exempts
assessments for emergency situations, as described, from these
This bill would, in addition, prohibit the board of directors from
imposing a special assessment, including an emergency assessment, or
an increase in the regular assessment of more than 2% on units that
are required by law to be provided to low- or moderate-income
purchasers without a vote of the owners of those units in accordance
with specified procedural requirements.

Tuesday, March 06, 2007

Developer sues over subdivision delay
Nancy Levy wonders about this situation, and so do I. Tactics like this always make you think about SLAPP statutes. But it's hard to tell from one article.

A Royal Oak developer, already suing a citizens group for slander, has hit the city with a lawsuit over six months of delays in the controversial Maida Woods project...In September, a group of residents formed the Westland Homeowners Committee for Environmental Conservation and Smart Growth. The homeowners say the project will destroy the area that's home to many animals. The group claims the site contains more wetlands than thought, which has prompted officials to delay approval several times. An administrative law judge is set to settle the matter. Last week, developers sued the group for at least $25,000 -- or as much as $2 million -- claiming slander, trespass and conspiracy.

Business - Folsom home lender closes -
Here's a story by Jim Wasseman, who used to be an Associated Press writer. He is very knowledgable about the housing industry and has done some excellent pieces on HOAs. Now he's bylined as a staff writer for the Sacramento Bee. Thanks to Nancy Levy for pointing this out. The story is about rising mortgage defaults that are bad enough to cause a bank to fail. Is this only the start? And if they don't pay the mortgage, they aren't paying the HOA assessments. Note also that this isn't just any bank. Look who is the CEO:

Growing consumer defaults have claimed the first home loan lender in the Sacramento area with the closing of Folsom-based Central Pacific Mortgage. The firm shut its doors last week and dismissed an unknown number of employees, the state Department of Corporations confirmed. "We know that it's closed and the next step in the process may be that they voluntarily surrender their license," DOC spokesman Andrew Roth said. The firm's demise comes amid growing trouble for the nation's mortgage lenders as rising numbers of borrowers default on their home loans. It also involves an influential local personality on the nation's mortgage lending scene and a 2004 appointee of Gov. Arnold Schwarzenegger. John Courson, Central Pacific's 17-year president and chief executive officer, chaired the national trade group for mortgage bankers, the Mortgage Bankers Association, in 2002 and 2003. Currently, he is chairman of the board of the California Housing Finance Agency, the state's affordable housing bank.

Fred Pilot flagged this CCFJ story. It is just amazing, and you have to read it to see how public officials are abandoning HOA and condo residents to the tender mercies of their private governments. Embezzlement isn't a crime if it happens in an least that seems to be the (amazing) message. So, asks Jan Bergemenn, does the same (il)logic hold true for murder?

"State laws that regulate homeowners associations lack criminal sanctions," Palm Beach County Assistant State Attorney Preston Mighdoll was quoted as saying in a recent article (Suit says Boca Rio funds misspent) about embezzlement in a homeowners' association.

California exodus has far-ranging implications | The San Diego Union-Tribune
Fred Pilot sent this link. San Diego and coastal California in general are rapidly turning into places where the middle class can't live, although San Diego is still relatively affordable when compared with parts north.

In the early 1990s, as Southern California suffered its worst recession in half a century, freeways were crowded with moving vans headed to Nevada, Arizona, Utah and points east, filled with people hoping to find a better life elsewhere. These days, there's no recession. California's economy is growing at roughly the same pace as the nation's. The statewide unemployment rate is at historic lows. There is no major wave of factories being shut down. But once again, more Californians are moving out than are coming in from other states. This time they're not looking for jobs. They just want a cheaper place to live.

Homeowners Wage Battles Against HOAs
Jan Bergemann of Florida's Cyber Citizens for Justice was on Fox News. Watch the video at this link. Thanks to Fred Pilot for the tip.
Henry Daily Herald, McDonough, GA - ‘Private Cities’ measure back before lawmakers
Nancy Levy sends this extremely interesting story of a major privatization proposal in Georgia:

ATLANTA — Last year, they were “community development districts.” This year, they’re “infrastructure development districts.” But to critics, legislation that would let developers use quasi-governmental powers to finance and build new communities in undeveloped areas across Georgia still goes by the more pithy sobriquet “private cities.” For the second consecutive legislative session, Republicans are pushing a bill and accompanying constitutional amendment that would allow landowners to finance the roads and water and sewer lines needed to create large developments. Subject to the approval of affected cities or counties, property owners would form districts governed by boards with the power to float bonds that would be repaid through taxes, fees and assessments levied on the residents.
Developer, buyers wage war over Panama island project - Sacramento Business Journal:
Fred Pilot sends this along, which is the story that you needed a subscription to read as linked below:

Granite Bay developer Shepard Johnson fell in love with Isla Solarte, a rustic paradise of sunshine and palms off the coast of eastern Panama, while touring the Caribbean years ago. He thought the small island had the same potential as Maui as a tourist destination, and in 1995 he launched a plan to develop and sell land there, largely to Americans looking to build inexpensive vacation or retirement homes. Now, he says he can't go back because he's facing criminal charges.
Look before you leap into a condo lifestyle
Fred Pilot located this. Here's a pithy little snippet:
Condo buildings "can be very political," said Jeff Turk, a private equity fund managing partner who recently served on a homeowners association board of a condo in Chicago for two years. "They are literally microclimates . . . in terms of issues that affect one side of the building that doesn't affect the other, like noise from a parking garage, or light creating different heating and ventilation on one side of the building than the other, or a leak in the floor of a rooftop level unit that doesn't affect units underneath it." The issues "can be very contentious or just plain very expensive," said Turk.

Former Massage Therapist and Home Stager Teaches Homeowners how Having High Energy and Rediscovering Your True Self Creates a 'You' Home
Nancy Levy says she couldn't resist sending this and I can see why. Here's the payoff line:

New business shows homeowners how to personalize homes in a sea of cookie cutter and generic design...Ayanna is a woman with a mission. She assists and teaches homeowners how to uncover who they truly are so that they will make better choices in all aspects in their lives and especially their homes.
Developer, buyers wage war over Panama island project - Sacramento Business Journal:
From Fred Pilot comes this saga that you need a subscription to read.
CLRC doesn't want to hold HOA elctions to public standards
Thanks to Fred Pilot for this latest from the California Law Revision Commission.
Residents losing their say about managing - National -
Thanks to Nancy Levy for this development from the land down under.
This is the "Homeowners' Bill of Rights Act" in draft form, produced by the National Conference of Commissioners on Uniform State Laws. There are several Bills of Rights for HOA and condo owners floating around these days. Sooner or later I'll have to sit down and compare them.
ps: I had an email from Jan Bergemann of Cyber Citizens for Justice calling to my attention the following text from the document:
GARY A. POLIAKOFF, 3111 Stirling Road, Ft. Lauderdale, FL 33312-6525, ABA Advisor

Jan notes that CCFJ considers attorney Poliakoff--a prominent member of CAI and active on CAI's legislative agenda--one of CCFJ's most dedicated opponents and he notes that Poliakoff's law firm organized what Jan describes as an "anti-homeowner group." The UCIOA amendment project is viewed with skepticism by HOA activists in any event.
Thanks to Gilbert Doubet, Rossmoor, Walnut Creek, CA, for sending me this link to the website of "Your Rossmoor." Doubet quotes me as saying, "“...small but vocal anti-HOA owners groups are organizing, using the internet as their medium and gaining attention from the press," and then says, "That's us in spades."