REO's In Sacramento County

Industry Update had the pleasure of hearing from Carl Simpson, Director of Code Enforcement in Sacramento County on Friday, August 28^th.  Carl spoke about the County’s perspective on vacant property, as well as a new strategy between SAR and Sacramento County for dealing with foreclosed properties.

Carl and other officials in the County intuitively understand the best solution they have to deal with vacant homes, and the problems associated therein are to get these homes occupied.  And because of this, they have restrained from instituting any fees associated with vacant properties, other than hard out of pocket costs.  After all, with so many foreclosed properties on the market, why would someone put an offer on a home with $20,000 in fees and penalties when there may be one a few blocks down with a clean title? 

As required by California State law, (no home may be accessible) the County has boarded up properties as necessary.  At this time they have not adopted the newly passed State law that allows local jurisdictions to fine a property owner $1,000 per day for failure to maintain the property.  The County’s objective is to secure the property and not generate any revenue.

To help with this problem, SAR, and several prominent agents who handle REO properties have joined together and are communicating on this very subject.  If an REO agent is assigned a home that is in bad shape, they will contact Carl to let him know the house will be fixed in a few days (or a few weeks if need be).  This saves Carl and his staff from checking on that home, opening them up to work somewhere else in their 900 mile jurisdiction.  If Carl receives a call on a property he knows is assigned to one of the agents, he will call them.  It’s entirely possible the home was vandalized overnight and Code Enforcement knows about the problem before the agent does.  This partnership will go a long way to alleviating any problems caused by vacant properties. 

 For the past several months SAR has been actively engaged in Sacramento County’s rental property registration ordinance.  This was deemed necessary after a rush of accidents caused by poor rental housing stock, including a five year old boy who broke both legs, one arm, and fractured his skull after the railings on the second story balcony at his apartment complex gave way.  In his own survey of rental property in Sacramento County, Carl recounted some horrible stories of homes infested with cockroaches and other bugs as well.  This new ordinance will take effect in January 2010, and will include a $2 per door fee increase, from an existing $10 to $12.  Property owners will be given a check list and allowed to self certify their property is safe.