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A journalist I respect suggested to me that, if I was going to devote space to the various financial travails of Rep. Laura Richardson, it is only fair that I give her Democratic opponents a chance to comment on her behavior. She is, after all, on the ballot Tuesday in California's 37th Congressional District.
Today Peter Mathews, a college professor challenging Richardson in Tuesday's Democratic primary, accused her of "a pattern of financial irresponsibility," citing published reports Richardson has defaulted at least seven times on three homes, including a default that led to foreclosure on a house in Sacramento this spring.
"It just seems to me she has not been financially responsible, and I'm wondering how she can be responsible for a federal budget when she can't balance your own budget," Mathews told me.
"She's not an average working American. She's making almost $170,000 a year," Mathews continued. "And most Americans don't own three homes. We need a congressman who can focus on the Iraq war, the economy, the environment and universal health care, which I support. A congressman should not be diverted by personal financial problems. It leaves her vulnerable to influence from the outside, especially from special interest groups."
He continued: "I wish her well as a private citizen, an individual. Everyone has faults and failings, but in this case it's a public official who has to be responsible to the public."
Richardson has not responded to repeated requests for comment from L.A. Land and declined to be interviewed for an article published in today's Los Angeles Times.
Mathews is a professor of political science at Cypress College and a community organizer. You can view his campaign Web site here. The other Democrat in Tuesday's primary, Lee Davis, did not immediately return a call for comment Saturday morning.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Good morning. It's threatening to be a gloomy one on the Westside, but I'm sure it will burn off soon. Without further ado, Pieter Severynen's Tree of the Week:
The Chinese Elm – Ulmus parvifolia
Few trees can take the place of the millions of magnificent American elm (Ulmus americana) trees that used to grace streets in large parts of North America but fell victim to Dutch Elm disease or suffered from elm yellows (phloem necrosis), shallow rooting, branch drop, and other major problems. The Chinese or Lacebark elm tree lacks the stateliness and large green leaves of the American elm, and it that sense is not a perfect replacement. But it is a graceful, easy to grow, dependable and normally pest-free tree in the southern half of the U.S. and on the West Coast.
Fast-growing to 40 to 60 feet and as wide or wider, the Chinese elm is semi-evergreen or almost so, depending on variety and temperature. Careful shaping in youth is a must. Form is variable, usually spreading, with long, arching branches and weeping branchlets. The light grey or tan bark on the sturdy trunk sheds in small patches to reveal a beautifully mottled pattern of orange reddish to light brown colors. The small, leathery, dark green, toothed, ¾ to 2½ inch long leaves have pronounced veins and asymmetrical bases (one side lower or wider than the other). The little green flowers in spring are insignificant, turn into tiny samaras, winged fruits, in fall. The tree will take pollution, poor or compacted soils, low soil moisture, freezing cold, strong winds, and overpruning, but it prefers more amenable conditions. Planted too close to paving, it will heave sidewalks and driveways. Many cultivars (cultivated varieties) of different shapes and sizes are available in the nursery. Some of those are favorite bonsai subjects.
Forty-five species of elms are indigenous to temperate zones of North America, Europe, Asia and North Africa. The Chinese elm’s homeland is North and Central China, Korea and Japan. It was introduced in the U.S. in 1794. The Chinese elm is sometimes mistakenly called Siberian elm and vice versa. But the Siberian elm, Ulmus pumila, is an undesirable and inferior tree, bearing no resemblance to its Chinese cousin.
Thanks, Pieter.
Your Thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: Pieter Severynen
 Worth reading: This story just posted on LATimes.com about the market for foreclosed houses, which includes the following nuggets/insights/claims:
"REO homes (bank shorthand for "real estate owned") that are in good
condition and listed at $300,000 or less are drawing as many as 15 to
20 bids from home buyers and investors looking for bargains, area real
estate agents report," Dinah Eng reports.
--"Right now, anything under $300,000 is a hot price," according to Century 21 Wright G.M. Earl Bonawitz, who is based in Temecula.
--"A $650,000 to $700,000 appraisal a year ago in some areas is now worth about $350,000," Bonawitz said. If you are scoring at home, that's a discount from previous appraised price of up to 50%.
--"Prices are more realistic. Time on the market is coming
down. I've seen bank-owned properties sold within five days recently,
compared to an average of 95 days for REOs at the first of the year." -- Stephen Yeager, president and chief executive of Weichert,
Realtors-Foothill Properties in the Inland Empire.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: L.A. Times
 From Bloomberg News today: "Newly delinquent mortgage borrowers outnumbered people who caught up on their overdue payments by two to one last month, a sign that nationwide efforts to help homeowners avoid default may be failing."
More: "In April, 73,880 homeowners with privately insured mortgages fell more than 60 days late on payments, compared with 39,584 who got back on track, a report today from the Washington-based Mortgage Insurance Companies of America said. Mortgage insurers pay lenders when homeowners default and foreclosures fail to cover costs."
What about "Hope Now," the mortgage industry's effort to help homeowners avoid foreclosure? Bloomberg: "The Hope Now program has so far proven insufficient, Sandra Braunstein, the head of consumer and community affairs at the Fed, told the Conference of State Bank Supervisors at a meeting in Florida last week."
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo credit: AP
Just a note: I started publishing gas price photos back on April 25, when I passed the station pictured above, which is on Lincoln Boulevard in Santa Monica. At the time, regular was $4.09 a gallon. I drove by again today, and you see the result: up 30 cents in a month. It may not get your attention, but it's got mine.
Your thoughts? Comments? Upload your gas photos to the Pain at the Pump gallery in Your Scene at LATimes.com.
 Those of you waiting to hear from U.S. Rep. Laura Richardson about her various defaults and unpaid bills will have to make do with this, a short video in which she thanks her supporters for electing her to Congress last year.
Highlights, to my untrained ear:
-- "I just want to say that I know it ain't been easy, but sometimes you gotta do what you gotta do to get it done." (Applause)
-- "Above all, you keep your word, until the end."
Relatedly, my colleague Steve Lopez has picked up the thread on this story. Maybe he'll have better luck than yours truly getting a call returned by Richardson's office, him being practically a movie star and all.
Hat tip: Harvey Korman fan, via comments
Photo Credit: L.A. Times
I'm not even sure what to call this, but it's pretty cool. It's Trulia's new "snapshot" feature, which, as Heather at Trulia points out, "is a really engaging way to visualize local real estate."
It's a marriage of listings, photos and Microsoft Virtual Earth. "You must see it to understand why it's cool," Heather says. I've seen it, it's cool. Click here for a Trulia snapshot of L.A. Or, click here for a Trulia blog item explaining what this is and why they built it.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
 Another clump of new homes is going straight to auction on June 1. The auction house Kennedy Wilson is billing these 17 homes in Palmdale and Lancaster as "gorgeous, luxury model homes." Here's the website.
Details: 2 to 5 bedrooms, ranging from 1,891 square feet to 4,128 square feet, previously priced from $289,000 to $605,000, now with "minimum selling prices" from $125,000 to $250,000.
More: "Successful bidders can realize incredible savings; over 50% off previous asking prices! Of special note is that ALL 17 homes will be sold with Published Reserve Prices and without any hidden reserve."
More: "These appealing former model homes are located in the desirable Palmdale and Lancaster neighborhoods of Calico Terrace, Discovery Trails, Grandiflora and master-planned Anaverde."
Your thoughts? Comments? Yes, luxury and Palmdale don't always go to together in the same sentence. E-mail story tips to peter.viles@latimes.com
Photo Credit: www.palmdalehomesauction.com
 The latest on the Laura Richardson mess, from the enterprising Gene Maddaus at the Daily Breeze: "Rep. Laura Richardson, D-Long Beach, whose housing woes have been national news for the past week, defaulted a total of eight times on three properties since 2004, a thorough review of county records indicates."
"Records show she has defaulted five times on her primary residence in Long Beach -- including three in the last year, as she diverted her private resources into her campaign for Congress."
Maddaus reports that Richardson's trail of missed payments dates back to 2004 -- long before the run of job-hopping she has said was partly to blame for her various missed mortgage payments.
Analysis: This began as a serious story about a member of Congress and how she handles her personal and campaign funds. But it's morphing into a garden-variety story about a person who has trouble paying her debts and happens to be an elected official. I still wonder, though, why her lender agreed to modify the loan on her Sacramento residence, which was her third house.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
Photo Credit: L.A. Times
Morning bloviation: Most reporting on the American economy is based on national statistics, giving the impression that all 300 million of us are in the same boat, rising or falling together at roughly the same time. Of course we all know that's not true -- there are big differences between regional economies.
Which brings me to a story from the New York Times earlier this week on the effect of the weak housing market on car sales. Here's what grabbed me: "In hot markets like California, nearly 30 percent of all consumers tapped into the value of their homes to help finance their new cars, according to CNW Marketing Research."
Look at the chart put together by CNW measuring percentage of new-car purchases in 2007 that were made with home equity loans:
1) California 29.8%
2) Florida 19.7%
3) Illinois 14.7%
National average: 11.8%
Think about that for a second: Californians were nearly three times as likely as the rest of the country to use their homes as ATMs during the bubble (at least for buying autos). You know that stereotype of the equity-rich homeowner who borrows against his or her equity and splurges on a new car, a vacation, etc.? That stereotypical homeowner is a California homeowner. Why did Californians behave differently? Because theirs was a bigger housing bubble. They had more equity to borrow against. Their housing ATM had a higher withdrawal limit.
Does this mean that the fallout from the housing crash will be worse here? I'm guessing it does. The way I read the chart above is that California car dealers have just lost a lot more of their sales than car dealers in Chicago. Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
Photo Credit: L.A. Times
News item from today's L.A. Times: "The number of homeowners in Los Angeles County who will receive a lower property tax bill grew to 128,000 this week because of the deteriorating real estate market.... Those receiving a reduced assessment in Los Angeles County will receive a written notice before June 30. On average, their tax bills will be $750 lower than last year."
Don't like the county's decision on your reassessment? You can appeal, but be patient: The current backlog to have your appeal heard now stands at one year, The Times reports.
Backstory: In early May, the assessor's office reported it would lower property tax bills for 89,000 L.A. homeowners by an average of $684. The assessor's office is in the process of reviewing assessed values of 318,000 L.A. County houses that changed hands between July 2004 and June 2007.
 The latest on the triple-default woes of Rep. Laura Richardson, from Gene Maddaus at the Daily Breeze: "Rep. Laura Richardson will face an uphill fight as she tries to reclaim her Sacramento house, which was sold in a foreclosure auction three weeks ago."
Why the uphill fight? "It's gonna be very, very hard - even if the sale itself was improper - to get the sale reversed," Richard Timan, an attorney who has handled similar cases, told Maddaus. "People who don't make payments are not beloved by judges."
Richardson, for those just joining us, is a Democrat from Long Beach who was reportedly in default on three separate California houses earlier this year. She lost one of those houses, in Sacramento, to foreclosure, but has maintained the foreclosure sale was "improper" because she had reached a loan modification agreement with her lender. She has yet to release details of the loan modification.
Elsewhere on the Richardson beat: Jared Allen of The Hill matches Maddaus' work, reporting Richardson's office has now confirmed she was in default on three separate California home loans earlier this year. When the story broke eight days ago, her office wouldn't confirm any defaults.
Allen also picks up the trail first blazed by Anthony York at Capitol Weekly, raising the question of whether Richardson borrowed against her homes to finance her campaigns. Allen: "... ethics watchdogs were crying foul over Richardson’s personal finances and questioning how she was able to lend her campaign to Congress $77,500 in the midst of multiple home loan defaults."
More: "Federal Election Commission (FEC) reports show that Richardson loaned her campaign a total of $77,500 — in three installments — between June and July of 2007.... (Richardson spokesman William) Marshall was unable to immediately answer questions about whether Richardson borrowed against any of her home equity — from homes she defaulted on — to finance her House campaign."
Analysis: There are a lot of interesting questions here. An e-mailer familiar with the business of loan modifications questions why Richardson's lender would agree to modify the Sacramento loan, pointing out that it would be rare for a lender to modify a loan when:
a) The borrower does not live in the house, and has no plans to live there.
b) The borrower has multiple additional mortgages and is not current on them.
c) The borrower has not tried to rent or sell the property.
d) The loan is significantly underwater -- that is, the property is worth less than the outstanding loan amount.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: L.A. Times
News item from Scott Reckard of the L.A. Times: "Showing Countrywide Financial Corp. President David Sambol the door,
Bank of America Corp. said today that it would appoint one of its own
top executives to oversee mortgage operations after completing its
acquisition of Countrywide."
More: "When it announced in January that it would buy struggling Countrywide,
Bank of America said that Sambol, the No. 2 executive to Countrywide
founder and Chairman Angelo Mozilo, would stay on to run the nation's
largest home-loan operation from Calabasas, where Countrywide is based.
"But that role will now be handed to Barbara J. Desoer, Bank of
America's chief technology and operations officer and a member of the
bank's management operating committee."
From the BofA press release: "She will be based in Calabasas, California. David Sambol, president of
Countrywide Financial Corporation, will retire after assisting Desoer
with the transition."
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
News item: New York Times "Economic Scene" columnist David Leonhardt, a self-described "evangelist for renting," writes that he and his wife have been lured by falling prices into taking the plunge into homeownership in Washington, D.C. "This month, we found a house that we really liked, and we made an offer. It was accepted," he writes.
His column is worth reading. He lays out a simple formula for evaluating whether a house is best rented or bought: "... divide the sale price by the annual rent. You can call the result the rent ratio. ... Throughout the 1970s, ’80s and ’90s, the average rent ratio nationwide hovered between 10 and 14. In the last few years, though, it broke through that historical range and hit almost 19 by the time the housing market peaked ... a rent ratio above 20 is a good indication of a bubble."
FWIW, I just ran this little formula on the house we're renting on the Westside. Our rent ratio (based on a Zillow Zestimate I believe to be pretty accurate) is 20.7. Just saying.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
From the reliable and reliably entertaining Westside Bubble blog: The Case-Shiller home price index for Los Angeles, including this morning's latest numbers. When you look at it this way, it's hard to make a case that we're close to the bottom.
What do all those lines and numbers mean? From Westside Bubble: "Los Angeles (black line, includes Orange County) is now down 24.4% from its peak in September 2006.... The national (orange line, their original 10-city Composite) index is down 17.8% from its peak in June 2006.
More: "Besides the original city index they have each city broken into Low, Middle, and High tiers (Under $417,721, $417,721 to $627,381, and Over $627,381). Los Angeles' Low Tier rose the most and has fallen back the most so far from its November 2006 peak, 30.8%. The High Tier rose the least and plateaued for a while before falling more steeply, now down 18.5% from June 2006."
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
Bloggers' note and back-story: Rep. Laura Richardson (D-Long Beach), responding to a report in Capitol Weekly, acknowledged last week that a home she purchased in Sacramento in 2007 had gone into foreclosure this spring. Richardson has said the foreclosure was "improper" because she had reached an agreement on a loan modification to keep the home. The Daily Breeze of Torrance has reported she was also in default on two Southern California homes this spring, although neither of those has gone into foreclosure. The Associated Press has reported Richardson owed nearly $9,000 in property taxes on the Sacramento home.
 The latest Case-Shiller report on home prices shows Los Angeles prices fell by 21.7% over the last year and were falling at an even faster rate this spring.
Nationally, Case-Shiller shows prices falling by 14.4% in 20 large American cities (see note below), by far the steepest rate of decline in the 20-year history of the index.
"There are very few silver linings that one can see in the data. Most of the nation appears to remain on a downward path," said David Blitzer, chairman of S&P's index committee.
The Case-Shiller report, which analyzes repeat sales of the same homes in large U.S. cities, shows the housing slump continues to be most pronounced in large western cities. The five biggest annual declines in price in March:
Las Vegas down 25.9%
Miami down 24.6%
Phoenix down 23.0%
Los Angeles down 21.7%
San Diego down 20.5%
Los Angeles continues to show accelerating annual price declines, although the month-to-month decline did slow a bit -- from 4.3% in the January-to-February period to 3.6% in the February-to-March period. Still, the 3.6% decline in the most recent monthly period makes Los Angeles the third-weakest housing market in the nation by that measure, with only Miami (-4.5%) and Las Vegas (-4.4%) losing more value.
Note on "20 large cities": An earlier version of this post reported, incorrectly, that the Case-Shiller index tracks home prices in the "20 largest cities." It does not, as Bruce Webb points out in his comment below. It tracks home prices in 20 cities, but they are not the largest in America.
Your thoughs? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: Associated Press
Good trend-spotting by the Wall Street Journal: "Home sales are rising in some U.S. metropolitan areas where lenders have slashed prices on foreclosed properties."
Metro areas such as? Such as Sacramento: "In California's Sacramento County, sales of
single-family homes totaled 1,669 in April, up 41% from a year earlier,
according to DataQuick Information Systems, a research firm. The median
sales price was $226,250, down 34%. Alan Wagner, president of the Sacramento Association
of Realtors, says the rise reflects more aggressive pricing by lenders.
"They've got to liquidate inventory. They're taking that house and
dropping $100,000 off the price, and all of a sudden they've got
multiple offers," he says. Some homes that sold for more than $400,000
a couple years ago now go for $225,000 to $260,000, Mr. Wagner says."
Lastly, check out what has happened in the city of Detroit: The average price of a home sold in the first four months of the year dropped 56% from year-ago levels to $20,514. That is not a typo.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
Median listing prices in greater L.A. were unchanged over the last week, and inventory was essentially flat as well, continuing a monthlong trend toward stability in the listings market, according to Housing Tracker's weekly analysis of MLS listings.
Numbers: The median listing price held steady at $449,000, a decline of 16.9% from year-ago levels. Inventory of for-sale homes and condos decreased by 14 listings, to 42,518, which marks an increase of 6.5% over year-ago levels.
Date Median listing price Inventory
4/06 $579,666 27,251
4/07 $545,000 35,489
5/07 $545,000 38,297
6/07 $540,000 40,766 (up 20.4% y/y)
7/07 $535,000 42,685 (up 14.5% y/y)
8/07 $529,000 44,483 (up 13.6% y/y)
9/07 $520,000 46,414 (up 16.9% y/y)
10/07 $510,000 46,603 (up 15.6% y/y)
11/07 $499,900 46,503 (up 19.0% y/y)
12/07 $495,000 (down 10.0% y/y) 43,174 (up 28.2% y/y)
1/08 $479,900 (down 12.6%) 40,850 (up 33.3% y/y)
2/08 $475,000 (down 13.5%) 43,625 (Up 38.3%)
3/08 $464,900 (down 15.5%) 42,098 (Up 31.4%)
4/08 $450,000 (down 17.4%) 42,430 (up 16.7%)
5/5/08 $450,000 (down 17.4%) 42,647 (up 13.7%)
5/12/08 $449,900 (down 17.4%) 42,532 (up 11.1%)
5/19/08 $449,000 (down 17.6%) 42,532 (up 8.8%)
5/26/08 $449,000 (down 16.9%) 42,518 (up 6.5%)
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
U.S. Rep. Laura Richardson was in default this spring on three separate California houses, and lost one to foreclosure, according to a hard-hitting report in today's Daily Breeze.
The Daily Breeze's Gene Maddaus: "Rep. Laura Richardson, who lost
her Sacramento home in a recent foreclosure auction, has also defaulted
on properties in Long Beach and San Pedro, records show."
Richardson, a Democrat from Long Beach, has declined to answer detailed questions about her finances, but has blamed her financial woes in part on the distractions caused by her whirlwind political rise, which saw her climb from local politics in Long Beach to the state Legislature in Sacramento and then to Congress in the space of two years. She also has heavy debts from her campaign for Congress in a special election last year. But with a congressional income of nearly $170,000, it is not clear why she failed to make payments on all three properties, and faced potential foreclosure on all of them.
The newspaper reports Richardson had fallen behind by $12,400 on payments on a San Pedro home in March, and was threatened with foreclosure on that property, and had fallen behind by $19,900 on payments on a Long Beach property in March, though it appears she paid that balance off. She owed more than $570,000 on the Sacramento house when it went into foreclosure this spring.More: Richardson "was able to bring her payments up to date
on the Long Beach home relatively quickly, but the San Pedro property
lingered in the foreclosure process for almost eight months, and still
has a pending auction date. In her first interview since the news broke Tuesday that her
Sacramento home had been foreclosed, Richardson blamed the foreclosure
on a miscommunication by her lender. She offered no apologies for
failing to make payments on three separate homes and expressed no
regret for failing to pay nearly $9,000 in property taxes.
More: "In her only admission of fault, she said she could have acted more quickly to correct the situation. 'I should have moved forward in an earlier fashion,' she said. 'I
acknowledge that. I intend never to conduct business in that fashion
again.'" The Sacramento publication Capitol Weekly first reported this week that Richardson had lost her Sacramento home to foreclosure, owing more on the house than the original purchase price when it was auctioned off. Richardson initially denied the report, saying she had worked with her lender to renegotiate the mortgage. She now says she was unaware the house was sold at auction until this week, and believes the sale was improper.
The Breeze reports that Richardson declined to answer numerous questions about her finances, including how many payments she had made on the Sacremento house. She purchased the house in January 2007 for $535,000 and owed more than $570,000 on the property when it was foreclosed.
Richardson attempted to link
her situation to the plight of others facing foreclosure, and said the
experience would help make her a better advocate on foreclosure issues. "I think this is what many Americans are unfortunately facing right
now," she told the Daily Breeze. "I am concerned that I can take what I have learned
from this to help somebody else. Many people are one step away from
issues that are life-changing moments. When a person moves across the
country, that is a life-changing moment."
Previous Richardson coverage: May 21: A.P. reports Richardson delinquent on $8,950 in taxes May 22: Report: Lender "took a beating" on Richardson home
May 22: Buyer of Richardson house says she "walked away"
May 23: Richardson seen as a "virtual shoo-in" for re-election
May 23: Richardson says foreclosure of her home was "improper"
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
 Pieter Severynen's Tree of the Week is always a welcome interlude here, but especially so this long holiday weekend.
The naked coral tree –- Erythrina coralloides
"The naked coral tree is a stunning sight several times during the year. In late spring fiery scarlet-red, fist-size flower clusters unfold at the end of the bare branches. They stay for weeks, resembling fireworks frozen in action. Three-part leaves, eight to 10 inches long, follow, green in summer, turning yellow in fall, to reveal a living sculpture of mustard-brown, twisted and gnarled branches. The garden variety ‘bicolor’ is particularly interesting; it sports red, white, and mixed color flower clusters on the same tree.
"Given full sun and moderate water, the tree grows at a moderately slow pace to become more or less round-headed, 30 feet tall by 30 feet wide. It is wise to plant the tree a little bit away from foot traffic, so that it may be admired but not touched. Beautiful as the tree is, thorns on branches and leaves can be vicious; the shiny red seeds are poisonous and the wood is brittle.
"Erythrinas are a cosmopolitan group with colorful flowers. The naked coral tree is from Mexico, but the other 115 Erythrina species come from tropical and subtropical areas in Africa, Central America, Australia, southern Asia, the East Indies and Hawaii. They learned to travel widely because the seeds can float in seawater for up to a year.
"Pea-like blossoms in various modified forms characterize the pea family, Fabaceae (formerly Leguminosae). Within the Erythrina genus of the family, flowers have evolved in two directions, depending on which bird does the pollinating. In the Old World, where the pollinator is a passerine bird with a short bill, the flowers are short and wide. They have a gaping corolla with the keel and wing parts widely separated so that the bird can stick its head and breast in the flower, get dusted with pollen and fly off to pollinate the next flower. But here in the New World, hummingbirds with long bills pollinate most species, even if unwittingly. As a result the flowers have grown a long tubular corolla for the bird to stick its bill in, while the keel and wing parts are small. But the stamens are equally well positioned to dust the hummingbird with pollen. As an added inducement, the nectar in the tube became very sweet in order to satisfy the high energy requirements of the hummingbirds."
Thanks, as always, Pieter.
Your thoughts? Comments?
Photo Credit: Pieter Severynen
Rep. Laura Richardson now acknowledges her Sacramento house was sold in a foreclosure auction, but says the sale was "improper" because she had reached an agreement with her lender to keep the home out of foreclosure.
From the Associated Press tonight: "Rep. Laura Richardson claimed Friday that her Sacramento home was sold into foreclosure without her knowledge and contrary to an agreement with her lender. She said that she is like any other American suffering in the mortgage crisis and wants to testify to Congress about her experience as lawmakers craft a foreclosure-prevention bill."
Richardson, a Democrat from Long Beach, had earlier denied reports that the Sacramento home was in foreclosure, even as the buyer of the home stepped forward and publicly offered to resell it to her for $535,000, the same price she paid for it in early 2007.
A new wrinkle tonight: The blog Foreclosure Truth reports Richardson also fell behind on payments on her principal residence in Long Beach, and faced possible foreclosure on that home as well: "Turns out her home in Long Beach was also recently in foreclosure with a Notice of Default filed by Title Trust Deed Service Company with the L.A. County Recorders office on March 31, 2008 as document number 546450 on behalf of Litton Loan Servicing. According to that document she was $19,921.74 behind on that mortgage as of March 28, 2008. Checking on the trustee sale number for this default it appears that this foreclosure action has in fact been cancelled -- quite possibly due to a loan modification as claimed." Richardson's office has not responded to L.A. Land's request for comment on that report.
From the AP: "Richardson, 46, makes nearly $170,000 as a member of Congress and was paid $113,000 during the eight months she served in the state Assembly in 2007 before her election to Congress. She also received a per diem total of $20,000 from California, according to a financial disclosure form she filed with the House of Representatives clerk."
The AP report does not detail the agreement Richardson reached with her lender to restructure her Sacramento mortgage, nor does it mention any agreement she might have reached to save the Long Beach home. The lender, Washington Mutual, told the AP it had not received permission from her to discuss the agreement.
Analysis: There are still a number of unanswered question about the congresswoman's mortgages, and whether she received special treatment from her lender when she renegotiated one and possibly two mortgages. She tells the Associated Press that she did not receive special treatment on the Sacramento home, and the lender is not commenting.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
 There is another ugly headline, but also a hint of recovery in the new monthly sales statistics from the California Association of Realtors.
Ugly headline: Median sales prices in the state plummeted 32% from year-ago levels in April. From the Silicon Valley Business Journal: "The median price of an existing, single-family detached home in California during April was $403,870, a 32 percent decrease from the revised $594,110 median for April 2007, C.A.R. reported. The April 2008 median price fell 2.6 percent compared with March's revised $414,640 median price."
If you are scoring at home, that's a decline of $190,000 in a year, or $3,600 per week. I understand the median price is an imperfect measure, and doesn't indicate that individual homes lost that much value. Still, that is Tom Petty stuff, my friend, because that is free-falling (It's Friday, a bonus link).
Now the glimmer of recovery: Sales in April actually increased 2.5% over year-ago levels, breaking a 30-month streak of declines, the CAR reported.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: Bloomberg News
 We have so many members of Congress in California that they often escape media coverage. That said, I thought I'd learn a little about Rep. Laura Richardson (D-Long Beach) (pictured, left), and pass it on. Richardson has denied press reports this week that she lost her Sacramento home to foreclosure.
--She's a Sen. Hillary Clinton supporter. She endorsed Clinton in September.
--She likes the Realtors, and they like her. She filed financial disclosure forms with the House Ethics Committee reporting the National Assn. of Realtors flew her to Las Vegas in November to help swear in the new president of the association, Realtor Dick Gaylord of Long Beach.
--In suggested remarks* at the NAR gathering, also filed with the House, Richardson's script read: "I might be one of the newest members of Congress but I am not a new member of the REALTOR Party. When I needed help to win a tough primary, REALTORS stood up and backed me even though I was the underdog."
--Real estate industry professionals have given her $39,500 in campaign contributions in the current election cycle, according to Open Secrets. Various unions really like her: they've given her $153,000 this cycle, according to Open Secrets.
--She won her seat in a special election last year after the incumbent, Juanita Millender-McDonald, died.
--Her district, the 37th, includes Compton, Carson, and parts of Long Beach.
--She faces a primary challenge on June 3 from Democrats Lee Davis and Peter Mathews, but their combined vote total in last year's 16-person Democratic primary was just 4%, and her hometown paper, the Long Beach Press-Telegram, has called her "a virtual shoo-in for re-election based on last year's Democratic primary results."
* It is not clear whether Richardson actually delivered the prepared remarks she filed with the House. Her office has not responded to questions regarding the trip.
Photo: Los Angeles Times
 I posted yesterday on the problems with down payments -- the problems are, more and more lenders are demanding them and many first-time homebuyers don't have them.
Now, comforting words from Washington: The National Association of Realtors is putting out the word today that rumors of required large down payments have been exaggerated: "Consumers across the country will have access to safe, affordable financing with down payments of only 5 percent on most mortgages, with 100 percent financing available on some loan products, and we could see an upturn in home sales this summer.”
Whew. For a second there, it appeared we might be returning to the olden days when people actually saved up money before purchasing a house. And paid cash for groceries.
The above comment is from NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, and was contained in NAR's press release about existing home sales in April. (Headline from Reuters: "The pace of existing home sales in the United States fell 1 percent in April to a 4.89 million-unit annual rate, the NAR said in a report on Friday that was slightly better than expectations."
As commenter Cal points out, the NAR said "restrictive lending practices hampered home buyers" in April. This is an important statement. The NAR is saying credit is too tight. It is also saying easier credit is on the way.
Analysis: The idea that Americans will have to start saving money for a significant down payment before buying a house is probably a good idea -- it would put the concept of "ownership" back in homeownership. But it bears no relation to the way American consumers behave. It will pass. Americans are not savers, and they are not encouraged by their government to save. The real estate industry needs buyers too badly to wait for Americans to rediscover a savings habit that has skipped at least one generation of consumers. The industry, and the government, will find a way to offer loan products that will not require large down payments.
Photo Credit: Getty Images
Warning to CD: More Laura Richardson coverage coming on the blog.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.
 News item, and then an e-mail from a reader. First the item, from Reuters: "As U.S. banks mop up the mess from billions of dollars of bad home loans, buyers are finding the days of cheap money are over and, in many cases, tougher versions of old lending rules now apply. ... Gone are the days when almost anyone could get a loan with a down payment of less than the traditional 20 percent."
Now the e-mail, from reader LTL: "Today I went online to try and see what I would qualify for if I tried to get an FHA loan. A bit about me, I'm 29, married, with two young children. I'm a lawyer, with household income of $225k/year. We recently relocated back to LA.
"Knowing that the new Freddie/Fannie limits had gone up, Today I went to the FHA website to see what I could qualify for. I saw that the L.A. County mortgage limit had increased to $729,750, which coupled with a 3% down payment, yields a maximum purchase price around $750,000. Or so I thought. Upon running my numbers (225k annual salary, $500/month car payment, $900/month education loan payment), I only qualified for a FHA loan of $362,790 with a 3% down payment of $10,973. It calculated a total monthly housing payment (PITI) of $3661, leaving me over 10k in left over income.
"The same calculator also yielded what I would qualify for with a "conventional" loan. I apparently qualify for a " conventional" loan of $672,378 with a down payment of $118,655, for a total maximum purchase price of $791,033. My monthly housing costs would be $7,472, leaving $7,541 in remaining income. So that's almost 50% of my income (and I haven't figured out how the calculator figures my take home income) for housing.
"I don't think most people have my annual income, I feel very lucky to make what I do, and I know that census statistics back up my contention that the percentage of people who make more than me is very small. So obviously, the FHA loan program is of little use to buyers in L.A. If I can't qualify for the maximum amount, who can? And if I went with the conventional loan, I would need over 120k in the bank for a down payment. How many people have that sitting around? Not many. Most buyers over the last few years have put nothing down, let alone 6 figures. "I would especially be interested to hear what the real estate agents and Cal have to say about what they are seeing when people attempt to qualify." Thanks, LTL. Before I ask for comments, an observation: I know many here believe the market should return to the days when a sizable down payment was required to purchase a home. If that comes to pass, the California market will remain weak for quite a while. If you take low-down-payment buyers out of this market, you shrink the pool of buyers sharply.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Closing in on five bucks at the corner of Fairfax and Melrose, though I have to admit I'm not familiar with the PRENA gasoline company. I say it's a new high* with an asterisk because, technically, I've published higher ($5.27 in Death Valley), but that wasn't Metro L.A. If you see higher than $4.69, send it to the link below, I'll publish it.
Submitted by SoCal4Hillary to the Pain at the Pump gallery on Your Scene at latimes.com.
If you want to see the inside of the Sacramento house purchased by Rep. Laura Richardson in 2007 (pictured), this video takes you inside. The video also quotes an angry neighbor who says the house became "pretty disheveled" under Richardson's brief ownership.
Does she still own the house? Did it fall into foreclosure? Richardson's one public statement on the matter indicates there was no foreclosure and she still owns the house and is making payments on it. Public records and three published interviews with an investor named James York, however, indicate otherwise. "It was a foreclosure auction. I took possession of the house as of May 7," York told Capitol Weekly, the Sacramento publication that broke the story.
Richardson's chief of staff, Kimberly Parker, told L.A. Land the Long Beach Democrat would have nothing to say about the matter today, and will issue a second statement about the property on Friday. Perhaps that will clear things up.
Photo Credit: 3622 West Curtis Drive in Sacramento, the house purchased by Laura Richardson in 2007, via AP.
 The Wall Street Journal quotes the buyer of U.S. Rep. Laura Richardson's Sacramento house as saying she walked away from the house, and can have it back if she wants it -- for the same price she paid for it in 2007.
Richardson (pictured) has denied a published report that her house went into foreclosure, saying she worked with her lender to renegotiate her mortgage.
But James York, the Sacramento broker listed on public documents as the new buyer of the home, tells the Journal's "Developments" blog the congresswoman walked away from the mortgage: 'She’s walked away from the property,' he said. 'I would be happy to resell her the home for the $535,000.'
That would represent a tidy profit for York, who reportedly bought the Richardson house at auction for $388,000.
Richardson's office has not answered questions about the Sacramento home. In a statement Wednesday, the Democrat from Long Beach said the house "is not in foreclosure" and that she had reached an agreement with her lender on a loan modification.
Photo Credit: L.A. Times
Read the entire Richardson statement by clicking below.
Read more Buyer of Rep. Laura Richardson's house: She "walked away" »
 The Daily Breeze reports that Rep. Laura Richardson (pictured) made only a few payments on the Sacramento house she bought in 2007, failed to pay property taxes, defaulted on the mortgage, and lost the house to foreclosure. The Daily Breeze reports that Richardson's lender, Washington Mutual, took a loss of nearly $200,000 when it sold the house at a public auction on May 7.
"They took a beating," James York, the Sacramento real estate broker who said he bought Richardson's house at a foreclosure auction, told the Daily Breeze.
The Daily Breeze report is based on public documents the newspaper published on its website, and an interview with York. It is at odds with Richardson's statement yesterday, in which the Long Beach Democrat said she had worked out a loan modification with her lender, and would "fulfill all financial obligations" on the property.
The Daily Breeze: "Rep. Laura Richardson lost her Sacramento home in a foreclosure auction two weeks ago, and left behind nearly $9,000 in unpaid property taxes. Richardson, D-Long Beach, appears to have made only a few payments on the house, which she bought in January 2007 for $535,000."
The newspaper's report -- that the house was foreclosed and an auction took place -- appears to conflict with Richardson's statement that the house "is not in foreclosure." (see the entire statement at the bottom of this post). Richardson's office has not responded to a request from L.A. Land for additional information about her mortgage and loan modification. The Daily Breeze reports she declined to be interviewed about the controversy.
The newspaper's report also calls into question Richardson's statement that she had worked out a loan modification with her lender and would fulfill all financial obligations related to the property. The Daily Breeze reports that the house sold for only $388,000, far below the $574,000 that Richardson owed on the property. Further, the Daily Breeze reports that the new owner, York, "assumed responsibility for Richardson's unpaid property tax bill of $8,950.79."
"Tell Laura I'd be happy to have her pay my property tax," he told the newspaper.
Photo Credit: L.A. Times
Click below to read Richardson's statement issued Wednesday.
Read more Report: Lender 'took a beating' on Rep. Laura Richardson's foreclosure »
The Associated Press tonight reports more details on the tangled personal finances of Rep. Laura Richardson and the Sacramento home she purchased in 2007. Richardson earlier today denied a published report that she had lost the home to foreclosure.
Highlights of the AP report: In addition to having trouble paying her mortgage, Richardson, a Democrat from Long Beach, fell behind on utility payments and taxes: "Records on file at the Sacramento County Tax Collector's Office also show Richardson is delinquent in paying $8,950 in property taxes," the AP reported.
The AP also reports that, according to public records, Richardson's house was in fact sold at a public auction: "The county records show the property was sold to a company called Red Rock Mortgage Inc. of Sacramento for $388,000, although no listing could be found for the company. That sale was officially recorded on Monday, according to the records. ... The Sacramento County Assessor's Office continues to list Richardson as the owner, even though the May 19 document on file at the Recorder's Office states that Red Rock Mortgage bought the home at public auction."
Richardson, in a statement tonight, said the house "is not in foreclosure and has not been seized by the bank." She further said she had worked with her lender on a loan modification, but did not name the lender.
Her office has not responded to requests from L.A. Land for details about the original mortgage and the terms of the loan modification.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
 In an e-mail inadvertently sent to a distressed homeowner trying to avoid foreclosure, embattled Countrywide Financial Chairman Angelo Mozilo lashed out at an online counseling service for distressed borrowers, calling the website's efforts "unbelievable" and "disgusting."
"This is unbelievable," Mozilo wrote in the e-mail, which was posted on a forum on the website LoanSafe.org. "Most of these letters now have the same wording. Obviously they are being counseled by some other person or by the internet. Disgusting."
Read full coverage of the e-mail flap from the Los Angeles Times here.
Mozilo was responding to an e-mail from Daniel Bailey, who wrote a "hardship letter" to Mozilo and 16 other Countrywide employees. Bailey acknowledged he wrote the letter using a format provided by the website LoanSafe.org.
In his original e-mail, Bailey requested a loan modification, saying he was unable to make rising payments on his adjustable rate mortgage. "The main reason that caused me to have a hardship and to be late is my
misunderstanding of the original loan," Daniel wrote in his e-mail to Countrywide. "I was told that after the first
year of payments, I would be able to refinance to a better fixed rate --
then the bottom fell out of the industry. My payments for that first
year were on time. I also lost my second income due to physical
conditions in a very physically demanding industry."
At least two other housing blogs wrote about the exchange Tuesday. On Tuesday evening, Countrywide issued the following statement: "Countrywide and Mr. Mozilo regret any misunderstanding caused by his inadvertent response to an e-mail by Mr. Bailey. Countrywide is actively working to help borrowers, like Mr. Bailey, keep their homes."
After receiving the "disgusting" e-mail comment from Mozilo, Bailey wrote a second e-mail to Countrywide, acknowledging he had consulted an online forum for advice in drafting a hardship letter to Countrywide: "In attempting to come to some way to save my home, I took the advice on
forming my hardship letter from a forum. Why? Not all of us have been
to a university to study business and we need some help in dealing with
these matters. (perhaps, if we had, we would not have fallen for what
we did, to start with).
"To have recieved the e-mail that I did, stating by one of your
employees, that what I did was 'disgusting' and 'unbelievable' has been
just about the final straw. I am trying to do the right thing, I am
trying with every ounce of what I have left in me not to blow my brains
out over losing the home I have been in for 16 years. The only hope I
had left was that perhaps the countrywide company did want to help the
people it is servicing ... then I receive that responce to my letter. Just
great. Now I know, that it is all a nice fat laughing matter to those
who are supposed to help."
Mozilo has been heavily criticized for reaping huge gains by selling Countrywide stock while the company's value was collapsing and the mortgage industry was in crisis. The Times reported he was paid $48 million in compensation in 2006, and cashed in stock options worth $140 million in 2006 and 2007.
LoanSafe founder Moe Bedard said he founded the website to help homeowners find information about working with their lenders to avoid foreclosure. "I knew there was nothing on the Internet to help people work out their mortgage loans," he told L.A. Land. Among other resources, the website gives borrowers e-mail addresses and phone numbers for bank executives who handle loan modifications. It also provides sample "hardship letters" to help borrowers make a written appeal for a loan modification. Bedard says his advice has helped 80 homeowners avoid foreclosure.
Bedard's sample loan letter begins: "I am writing this letter to explain my unfortunate set of circumstances
that have caused us to become delinquent on our mortgage. We have done
everything in our power to make ends meet but unfortunately we have
fallen short and would like you to consider working with us to modify
our loan. Our number one goal is to keep our home and we would really
appreciate the opportunity to do that."
Bedard said he encourages distressed borrowers to use the format of the letter and then to "make it your own, and don't be too lengthy."
Bailey's e-mailed hardship letter to Countrywide, which he posted online, begins: "I am writing this letter to explain my unfortunate set of circumstances that have caused me to become delinquent on my mortgage. I have done everything in my power to make ends meet but unfortunately I have fallen short and would like you to consider working with me to modify my loan. My number one goal is to keep my home that I have lived in for sixteen years, remodeled with my own sweat equity and I would really appreciate the opportunity to do that. My home is not large or in an upscale neighborhood, it is a “shotgun” bungalow style of only 900 sq. ft. built in 1921. I moved into this home in May of 1992 … this was the same year I got clean and sober from drugs and alcohol, and have been ever since, this home means the world to me."
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: Getty Images
 Worthwhile reading: "Why a Housing Bailout Won't Help," an interesting piece from the Wall Street Journal's Holman Jenkins Jr.
Most of you have read the anti-bailout argument in many forms and forums. What makes this piece interesting is Holman's snapshot analysis of the underlying mortgage mess as a relatively simple, regional problem: too many people made bad bets on the future of residential real estate in remote southwestern suburbs. Think Palmdale, Inland Empire, newer parts of Sacramento, San Diego, Phoenix and Vegas. Put these areas together on a map and you have what Jenkins calls "a single, nearly contiguous blob reaching from Sacramento to the environs of Las Vegas and Phoenix."
His analysis neatly summarizes a trend I've written about here: bad bets on the future of far-flung suburbs. Holman calls these "communities that now appear to have little future." Ouch.
What's wrong out there? Jenkins: "Many of these homebuyers are underwater not just because they bought
more house than their incomes could support, and not just because
prices are falling. They were also betting on commute patterns and
demographic expectations that are proving invalid.
Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Hat tip: EP, via e-mail.
Photo Credit: Associated Press
 Update: California Rep. Laura Richardson today denied a published report that her $535,000 Sacramento home had slipped into foreclosure, saying she had renegotiated her loan to keep the home.
The house "... is not in foreclosure and has NOT been seized by the bank," Richardson, a Democrat from Long Beach, said in a statement. "I have worked with my lender to complete a loan modification and have renegotiated the terms of the agreement -- with no special provisions." (Richardson's entire statement is at the bottom of this article).
Earlier, Capitol Weekly reported that Richardson walked away from the mortgage on her $535,000 Sacramento home, letting the house slip into foreclosure and disrepair less than two years after she bought it with no money down.
"While being elevated to Congress in a 2007 special election, Richardson apparently stopped making payments on her new Sacramento home, and eventually walked away from it, leaving nearly $600,000 in unpaid loans and fees," the | |
