NOVEMBER - 2011 Newsletter by Julia Huntsman

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.


Please click on this link to view the Housing Trends NOVEMBER - 2011 Newsletter http://yoursocal.housingtrendsenewsletter.com/

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau, Realtor.org reports and other sources.

Housing Trends eNewsletter is filled with local and national real estate sales and price activity provided by MLSs and the National Association of Realtors, U.S. Census Bureau key market indicators, consumer videos, blogs, real estate glossary, mortgage rates and calculators, consumer articles, and REALTOR.com local community reports.



If you are interested in determining the value of your home, click the “Home Evaluator” link for a free evaluation report:
http://www.juliahuntsman.com/Home-worth.html

Sound decisions can only be made with accurate and reliable information, and I am happy to be a trusted resource for you. Thank you for the opportunity to provide you with this monthly eNewsletter, and I look forward to answering any questions you may have and to the opportunity to be your REALTOR® in the future.


Sincerely yours,



Julia Huntsman

Huntsman Properties

Area REALTOR Long Beach CA 90803
562-896-2609
 julia@juliahuntsman.com

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Keeping Up With Capital Gains for 2012

It's that time of year when not only are the seasonal holidays of Thanksgiving and Christmas are on people's minds, but so are certain real estate issues, such as capital gains taxes.

The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 extends the Bush era tax cuts until the end of 2012. In 2013, the capital gain rates are set to return to the old 20% and 10%, per Asset Preservation, a 1031 exchange company.

1031 exchanges may not be conducted with an owner occupied principal residences, but they do apply to a taxpayer's investment property which he/she wishes to exchange, rather than sell outright. If your tax bracket is over 25%, you will be paying at the 2003 15% capital gains rate.  Beginning in 2013, this rate will increase to 20%.

So for now, you have another year to accomplish an exchange, but time moves on quickly. Depending on the market value and the time it takes to find the qualified buyer for your current property, find the new property including its selling conditions, the year can melt away. 

To find a comparison for your selling situation, see this exchange vs. sale scenario or see general 1031 exchange information.

Long Beach--and Nearby Cities-- Residential Market Prices and Sales October 2011

Long Beach Harbor view

While prices are dropping overall in the area based on annual figures, condos in zip code 90802 showed a price increase from the prior year of 32.5%; 90803, an increase of 57.9%--and dropped in other reported zip codes (from prior year), per the Los Angeles Times zip code chart for October, 2011. 

Single family home prices in Long Beach dropped by varying percentages from 2.1% (90806) to 24.6% (90804), and based on one house sale in 90802, an increase of over 40% in price from last year.  These prices also vary according to the number of short sales and bank-owned properties in the mix.
Even though decreases are reported here, these are year-to-year, and 2011 month-to-month comparisons may actually show some increases.

October 2011 sales volume in Long Beach:

Single family homes - 181 properties
Condos/townhomes, Co-ops, OYOs, Lofts -  79 properties
Units (2-4) -28  properties

September 2011 sales volume in Long Beach:

Single family homes - 188 properties
Condos/townhomes, Co-ops, OYOs, Lofts - 75 properties
Units (2-4) - 36 properties

August 2011 sales volume in Long Beach -

Single family homes - 207 properties
Condos/townhomes, Co-ops, OYOs, Lofts - 97 properties
Units (2-4) - 40 properties

Buyers should understand that there's a lot of opportunity in the area right now--take a look at the MLS inventory vs. the number that have sold:
Currently, there are 141 active listings in the MLS for 2-4 unit properties in Long Beach, ranging from $159,900 in North Long Beach, to $1,499,000 for 4 units in Alamitos Beach (90802).

There are 668 single family homes actively listed in Long Beach from just under $100,000 in North Long Beach to over $9 million in 90803 on Sea Isle in Naples (90803).

There are 444 condos/townhomes, OYOs, Co-ops and Lofts actively listed, the vast majority of which are condominiums, ranging from $47,000 in downtown Long Beach to $1,095,000 in Spinnaker Cove.

Take a look at the properties attached to the links--it's an easy to sift through the market!

Market Prices in Other Cities:

Cerritos has had only a 6.9% drop in single family prices from October, 2010; Diamond Bar has a 25% increase; two zip codes in Downey have an increase;  Duarte, a 40% increase; San Gabriel, a 22% increase; Torrance, 3 zip codes show an increase; all zip codes in Whittier increased up to 26%; Los Alamitos, .8% increase; Garden Grove, two zip codes show increases of 2-3% range.  (See the Los Angeles Times chart for more information.)

With interest rates not seen since the 1940s, it's a great time for low monthly payments!

Don't Underestimate the Value of a Good Appraiser

Home appraisals are something like appraisals of other treasured possessions -- the owner would like the highest and best price for what the current market will bear.

But one of the questions is: what is the "market?"
There are "regular" standard sales, where the owner has a margin of equity or full equity, there are short sales, there are previously foreclosed properties now being sold as bank-owned, or "REO" properties. When it comes to an appraised value, the results depend so much on recent local area activity, and which properties are used for comparison to the home being appraised, and last but not least, the experience, knowledge/ability and professionalism of the appraiser, including his/her adherance to the Uniform Standards of Professional Appraisal Practice.

Both buyers and sellers should be aware of current basic issues about appraisals. A 2007 lawsuit initiated in New York brought about the Home Valuation Code of Conduct (HVCC) and the ultimately controversial use of Appraisal Management Companies , an intervening layer between the buyer's lender and the appraiser who does the report for that lender. Appraisers are supposed to be independant licensed real estate professionals who are trained to give an independant analysis (under various guidelines including FNMA's) of the value of a property. The New York lawsuit came about because of pressure exerted on appraisers there (in this case by Washington Mutual, now gone) to fraudulently inflate home values. So the HVCC was developed and mandated to be used nationwide by FNMA, meaning if you wanted a loan in this country, many of which are invested in by FNMA, you had to follow this new method of obtaining an appraisal.  This was in 2007.
Today, despite some positive changes in the Code since 2007, the complaints about appraisers sent out through AMCs are still rampant.  A 6-person panel which I attended at last weekend's National Association of Realtors convention in Anaheim expressed various points of view, including:

• AMCs hire the cheapest and lowest quality appraisers (ouch!);
• This lower paid AMC appraiser may be given a "number" to hit through the Automated Valuation Model (AVM) method performed by AMC staff (not qualified appraisers) before he/she ever goes to the property. 
• Many of the AMC appraisers are much more recently trained and hired--their license number is an indication of how long they've been in the business.
• They may have little or no experience with the immediate area of the subject property. (My comment: I have not personally met someone who has flown down from San Francisco, but I did have experience the other day with an appraiser who met me in Old Lakewood City neighborhood and said that all neighborhoods in Lakewood were the same--he obviously hadn't been to Lakewood Country Club area, for example.)
• They may be pressured to "hit a number" that their AMC has already arrived at.  (Comment: Yep, I've had experience with this too--last year an AMC rep told me over the phone before the appraiser ever went to the property what the property value was of Long Beach condo. I had to put up a fight to get an actual appraiser to come to the property, and guess what? The valuation came in at the "Number" I was given over the phone.)
• Because they make less money than a traditional appraiser, they take on more assignments in a given period of time; they have less time to complete the report, and therefore less time to research the property and comparables, evaluate it, and prepare the report. 
• Market value, if the property is an equity sale, may or may not include area distressed property comparables, depending on the nature of that market.
• Short sale market value may be affected by comparables sales where the bank has given $3,000 or $25,000 to the seller vs. a short sale where there is no seller incentive. (Comment: HAFA short sales and Chase Bank are good examples.) Sometimes that information can only be found out by calling the listing or selling agent, as the MLS may not include that information. The AMC appraiser may not take the time for that kind of research.

What should both the buyer and seller understand about this situation? That the appraisal is acutely important to each of them, and even one which may have been done competently and professionally could still be called for "review" by the buyer's lender's underwriter. But there is less chance of that happening with an appraiser who knows his/her market as an appraiser.

• The listing agent and selling agent may directly speak with the appraiser.
• What is the appraiser's license level? Trainee vs. Licensed vs. Certified?
• A good listing agent will qualify that appraiser on the phone before he/she is admitted to the property, and in fact, it is the listing agent's duty to the seller to find out about that geographic competence (they always tell you they know the area, so you have to ask more questions), the appraiser's skill/knowledge level, and to make sure that appraiser is given critical information about the property's features, discrepancies with tax record, conditions--things that can affect value--along with area comparables. (Comment: My Lakewood appraiser recently told me the number of bedrooms didn't make a difference on value after I pointed out to him a discrepancy with the tax records--but oh yes it does! If it didn't, people wouldn't be paying thousands of dollars more for a 3rd bedroom.)  If the listing agent believes the appraiser does not have geographic competency, the listing agent may deny access to that appraiser, i.e., last time in area?, how many subject properties visited in area?  "Local market knowledge is the primary qualification to hire a specific appraiser for an assignment."
• The buyer/borrower is entitled to copies of ALL valuations of the property including Broker Price Opinions, Comparable Market Analysis, and AVMs, and 3 days prior to close of escrow, the borrower can request a copy of the appraisal, and all fees are required to be disclosed prior to close of escrow. 

For local market information about your area, please contact me, or find active listings and real estate information at http://www.juliahuntsman.com/.

What Are the Best and Worst in Home Remodel Values for Long Beach/Los Angeles?

The latest Cost vs Value report is out!

Buyers often want a 3 bedroom house or condo not because they need all the bedrooms for sleeping quarters, but because they need office space. Interestingly, according to this Report, the home office remodel could be the lowest in terms of recouping cost.  One of the things to consider is a future buyer's need for an actual bedroom and the closet that was previously turned into office shelf or storage space. 

The next two items with under 50% return on original cost are a sunroom addition and backup power generator--with the fourth on the list being a bathroom addition at 53.5% return.

The top best return remodels are a steel entry door replacement (100% return), garage door replacement, deck addition and minor kitchen remodel, alnd with siding replacement and vinyl window replacement--all over 70% cost recoup.
The only item in the 2011 report to increase in return on original cost was the garage door replacement, included for the first time in the report--new garage doors add curb appeal on a prospective buyer's first impression of a home, and are also one of the lowest actual cost projects to install for a homeowner. (Just think of the times you pulled up in front of a great house with a weathered garage door.)  All other items in the report have decreased.

Master suite addition and family room additions are between 60-70% return.

Overall, exterior replacement projects under $25,000, rather than more expensive remodel projects, are leading the way in return on cost, since they are less expensive.  The outdoor wood deck tied with the minor kitchen remodel.

Owners might want to consider utilizing existing space for conversions--they may be less expensive than a new addition, and they don't change the original floorplan or "footprint" of the home. 

If an addition does not have a good flow for the overall floor plan of the home, especially considering the price of a home, a buyer may go elsewhere to find a more recently built home that was designed for such amenities.

See the 2010-2011 Cost vs. Value annual report by Remodel Magazine for the Los Angeles area,

To find properties in all Long Beach (and nearby cities) areas and types, please go to this property search.

1-Minute News on Long Beach Homes and Condos on Facebook.

To see this fast update on market news every month, just click on "Like" button for my Facebook page in the right column, then go to "1-Minute News".

Bank of America's Short Sales Programs are Expanding and Improving

Bank of America attended a webinar today with Bob Hora and the CDPE Distressed Property Institute revealing all about new processes in place: The Bank of America will be sending out a package, The Home Transition Guide, to the homeowner explaining owner's options, including a short sale.

2010--90,000 short sales completed by the Bank.
2011--over 100,000 short sales so far.

Their goal is to have a leaner short sale process in the future where the entire process is shorter by several weeks.
More people are hired to do short sales at the Bank, today there are over 3,000 staff members, including those at their call centers. A single point of contact at the Short Sale Department throughout the short sale will be established after the homeowner's initial contact with the Bank of America. Homeowners who go into customer assistance
SLAs (service level agreements) will agree to responses with certain periods of time, and Bank has established a Closing Center in Arizona to handle short sale closings.

The bank has over 500 investors and many MI (mortgage insurance) companies to work with, and get approval from.  Depending on their relationship with these investors, the timeline may be faster or shorter, and it's important that the homeowner understand these relationship.  The short sale specialist can explain who is delegated investor or non-delegated.

If a borrower is having a hard time getting a loan modification, they should turn to an Realtor quickly:  A short sale file needs to be opened with an accepted offer from a buyer at the bank at least 45 days prior to the foreclosure sale date. So if you the borrower has a Notice of Default on your property now, your time is even more limited to market and find a buyer in time.

The Bank also is reviewing every transaction for arms length transactions--the short sale market place is not the venue for questionable "flips" or "deals" during the short sale process, and the Bank ( as well as other legal entities) are on the lookout for practices that do not conform to regular procedures.

The Bank prefers a short sale over a deed-in-lieu, and the bank doesn't consider the DIL the best transaction for the Bank or the investor.
For assistance with a home valuation if you're considering a short sale transaction, either call me or contact me through my website, where I have much information at "Help for Homeowners" at http://www.juliahuntsman.com/.

Just Sold: Wrigley Traditional for $360,000



2247 Oregon Ave.

This is a vintage 1940 house with so much original charm. It had been in the same family for decades, and was sold by the heirs of the original owners who had it built. Later rear additions added a den and extra bath and enlarged the rear bedroom. The living room was spacious, had an original fireplace, entered through a small front entry way. And the kitchen featured a convenient dining area with attached wall bench. If you love 1940's and 1950's bathroom tile in very good condition, this house had the perfect display of it.

The rear yard had mature trees and a beautiful grassy area and a covered patio area. The permitted bonus room off the garage was just the extra space the buyer was looking for.
While a lot of people are looking for huge houses with great rooms and very few room partitions, this house was the perfect find for a buyer wanting a traditional floor plan with separated rooms. Three bedrooms, 1.5 baths. $360,000 selling price.

For a market analysis of your property, please contact me at http://www.juliahuntsman.com/. If you're looking to buy in the Wrigley area, or elsewhere in Long Beach, please contact me for a list of properties in your price range.

Huntsman Properties
Lic 01188996

It’s time to take another look at short sales

As recently as a few months ago, if you would have told a real estate agent who specialized in short sales that they’d be raving about a lender’s stellar service and rapid approval times—not to mention significant cash incentives for financially strapped homeowners for pursuing a short sale—you’d have gotten some strange looks.

That’s all changed. And it’s changed faster and to a greater extent than most real estate professionals ever could have imagined.

With a glut of bank-owned properties dragging down the recovery of the real estate market, as well as the national economy, major lenders are more eager than ever before to avoid foreclosure. So they’ve sharpened their focus on short sales. Bank of America, for instance, says they have processed 500,000 loans for short sales this year through their online Equator system. It's not a perfect world--not all short sales close: there are many parameters, including lender and investor efficiency, to getting a short sale closed. California Association of Realtors states 3 out of 5 actually close. But for those sellers willing to do the work, and for buyers willing to qualify and hang in there, there are successful closings.

The biggest lenders in the country have staffed up to ensure rapid processing of short sale applications. They’ve come up with cash incentives, some in the thousands of dollars, at closing for homeowners who pursue a short sale. And they’re proactively reaching out to CDPE agents and putting them in touch with delinquent borrowers.

This is big news and the media has not really caught onto it yet. What’s important for you to know is that whatever you’ve read or heard in the past about long lag times and frustrations with short sales is probably no longer the case.

To find out more,I invite you to contact me and/or to visit my website at http://www.juliahuntsman.com/ to learn more and feel free to contact me any time at if you or anyone you know is struggling with an unmanageable mortgage.

Getting Charged Too Much for HOA Documents?

One of the escrow expenses buyers usually pay when buying a property within a homeowner association are document fees for the CCRs, Rules and Regulations, and other documents they are entitled to. This sometimes amounts to several hundred dollars.  Even though a law prevents homeowner associations charging more than the actual cost for such documents, a loophole allowed an HOA to delegate this task to outside vendors, who could charge whatever they wanted.

Good news. Earlier this month, California Gov. Brown signed AB 771, and the loophole closed, preventing home buyers in common interest developments such as condominiums or townhomes from being charged excess document fees.


Buyers used to only have to pay $150 at the most, but that cost may now go up to $400, payable up front by the buyer. But if a charge goes much beyond that, a buyer should be aware that they perhaps are being over-charged, and ask for an accounting of that cost by the HOA or its property manager. A fee of $1000 is probably excessive, and would be considered a financial burden by most condo buyers, and could be an indication that a buyer is being charged for documents that are "bundled" in, and not required.

Where is California Real Estate Going for 2012?

Here are highlights from the September California Association of Realtors presentation on market predictions for California in 2012:

• Sales volume between Aug 2010 and Aug 2011 of detached homes was up by over 8%.
• Los Angeles County median price at $312,900 for detached homes down 7% from one year ago; Riverside County median price of $202,060 down 2.9% one year ago.
• Calfornia homes: 2 in 5 sold were distressed properties.
• California median home price of an equity sale was $431,000, for REO it was $240,000; a short sale was $287,000, for similar sized houses.
• In 2011, sellers' median net from sale was $75,000, highest amount since 2009.
• All-cash sales are over 25% of homes sold -- the highest percentage since 2000.
• The predicted 2012 California overall median house price is $296,000, an increase of 1% from 2011.
• Here is the entire California Housing Market 2012 Forecast presentation

“Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.”  “Real estate: It’s time to buy again” Fortune Magazine’s 3/28/11 article written by Shawn Tully.

Prime Opportunity for Investing/Buying in the Southern California Residential Market

In August, 2011, the California statewide median price for a single family home was approximately $297,000, an estimated 7% drop in price from 2010, BUT an 8% increase in sales volume from one year ago, per California Association of Realtors.

The lowest median single family home price in California in our current cycle was $274,000 in 2009; and $303,010 in 2010.   Los Angeles County median price for a single family home in 2009 was $333,920 and for 2010, up to $346,840.

And yet, current distressed property sales continue to make up 40%-50%, and more, of local markets, with a recent huge increase in foreclosure properties within the last month.  These trends show how opportunities will continue to bring more investors and more private money into the market. Traditional financing, i.e., FHA and FNMA, has introduced some types of requirements that discourage the present pool of buyers, that private investors with money to lend are entering the marketplace, because they believe that property values have hit the lowest point in most areas. 

There is a need for the rehab and re-sale of distressed properties in disrepair, yet traditional financing doesn't offer that vehicle for those with the goal of "buy, fix and sell." Investors who don't fit the box for traditional financing avenues do have these private money alternatives that may work for them:

• one-year loans for flip properties--no pre-payment penalties
• stated income applications for flip properties
• loan amount to be based on 60% of private lender's determined value of property
• also available are constructions loans based on "repaired" value of property
• on site appraisal and photos may not be required

Interest rates for these short term investor loans are higher than standard FNMA-type financing, however, they are also a vehicle which is more lenient on the borrower's prior financial events (i.e., short sale, foreclosure issues), and they are geared towards the eligibility of the property, and the case-by-case history of the borrower.
If you are looking for opportunity in the investor property market for 1-4 residential units, contact me for more help on finding the property and the financing!

What Will the Loan Amount Reduction to $625,500 Do to Local Markets?

Today I was contacted by a Los Angeles Times housing market reporter covering the market on new loan amounts coming into effect soon.  It's really hard to say exactly what the outcome will be, but one thing is certain: California really doesn't need any more uncertainty or instability in its housing market.  Legislators elsewhere really do not seem to be very concerned, probably because the vast majority of them do not have a home to sell in California.

Single family homes in the high end market of 90803 and 90814 may feel the cut in loan amounts to $625,000. Currently there are 145 active listings, 113 of which are over $625,500 (the new loan amount starting October 1st).  Between June 1 and August 31, 26 homes sold over $729,750 (the current limit on conforming loans), and 24 sold under $625,500, while 16 sold between the two loan amounts.  That represented 25% of the total 66 homes sold in that time period.

Currently, of the 145 active listings, 113 are listed over $625,500 (just using the loan amounts as the dividing line for the sake of discussion), 95 are listed over $729,750--meaning 18 are in the critical area in between.  Currently, 26 homes are in escrow, all over $625,500--but would the 8 in the critical area under $729,750 be buying in the future at a higher interest rate?  The homes in escrow (26) of the 145 active listings shows that the seller in this area currently has about an 18% chance of selling in the current loan market. 
Now, along with an already competitive situation in the high-end market, what will the future bring with a jump up in interest rate for the new jumbo loan amount?
See more at http://longbeachrealestate.blogspot.com/2011/07/change-may-be-coming-in-loan-amounts.html

But, there is more, not to be discussed here: the QRM, or qualified residential mortgage which basically could turn the conventional loan market at all levels into a one-size-fits-all 20% down payment.

Buyers of Long Beach Condominiums Are Using More Conventional Loans--or All Cash

In Long Beach, condominiums tend to be concentrated in several specific areas, and two of these are in the downtown and shoreline area zip codes. Condominiums are a wonderful homeowner opportunity, also attractive to many segments of the buying population for investment/rental reasons as well.

A total of 105 condominiums sold in 90802 zip code (downtown Long Beach, Alamitos Beach and Ocean Blvd.) between June 1 and August 31 in prices ranging from $60,199 to $775,000:

As reported in the MLS, all-cash buyers represented 28 (or 27%) of these sales, most for units under $200,000; 30 units were listed as REO (bank-owned) properties; 35 units were listed as subject to short pay approval; 35 units were listed as standard or equity sales (33%).  Per the MLS, 58% were financed: only 12 were reported as purchased with FHA financing, 2 with VA loans, while 47 units were purchased with conventional financing.

A total of 29 condominiums sold in 90802 zip code (Marina Pacifica, Bluff Park, Belmont Heights, Naples, Belmont Shore) in the same time period, from $134,000 to $665,000.

As reported in the MLS, all-cash represented 7 sales(or 24%); only 1 FHA financing, 19 conventional loans (69%); 16 units were standard equity sales (50%); while 8 were closed as short sale properties and 4 were listed as REO properties.

FHA financing, which used to be the great introduction to the first time buyer's purchase is increasingly a very limited vehicle for financing a condo.  Why? Because homeowner associations are not renewing their FHA project approvals, without which there is no FHA financing in that association. In a check of the HUD project approval list for Long Beach, the associations are dropping off the active list at an alarming rate. For some, it's a problem of having too many delinquent dues--but surprisingly, some HOAs may not even know they have expired as the old Board members have long since left the scene.  For others, they do not know that since 2008 FHA no longer does "spot" approvals, as they once did financing on a unit-by-unit basis, so they are not aware that they are limiting the ability to attract new homeowners. If you are a current condo owner, you should investigate what your association can do to obtain FHA approval--if only to enhance the prospect of obtaining a reverse mortgage if you are in the over-62 age bracket. Reverse mortgages are generally FHA loans, but if your project isn't approved, you will not be able to obtain one.

Both buyers and sellers need to be actively aware of these condo financing issues and investigate in advance their loan options with both FHA and conventional loans. While FHA is 3.5% down, it also has some other expenses rolled into the loan which a conventional loan does not.  There are some sources for 5% down conventional financing, which is more likely to be a better fit. If FHA is your only option because of your overall loan qualification circumstances, be prepared for a very diligent and patient search for the right homeowner association that is FHA approved before you make the offer.  And as we see above, all-cash buyers make up about one-quarter to one-third of the condo buying market in these areas.

Please contact me or visit my website for more information.

Cut Your Electric Bills with Solar Energy -- Is It For You?

Solar energy panels may warm your water, which can lower your water heating costs, or cut your overall cost of electricity.  Solar panels collect solar radiation from the sun and convert that energy to electricity. At first blush, the panels sound great, but look further--buying them outright would be a pretty big investment for most homeowners, and then there's the leasing option, which cuts upfront costs but has other features.

the City of Los Angeles is starting up its rebate program again tomorrow, which will cover about 30% of the total cost, down from the earlier 50% coverage.  Per a recent Los Angeles Times article, a 5-kilowatt system costs about $35,000--with a 30% rebate, the owner will recoup the cost in 13-15 years.

Leasing agreements account for about half of the California market, and California accounts for about half of the country solar installations.  The lowered rebates, however, have also caused upfront costs for leases to increase to $4000 and $5000, so it's not so attractive for many potential customers. To reduce that upfront cost, leasing companies would have to increase their leasing fees, which will have the total effect of a monthly increase in montly electric bills, not a decrease. Solar panel leasing companies have a less exciting outlook in some cases.

Over time more companies in the business in California selling more panels will eventually make costs lower--already the panels are less expensive than in 2010, but labor costs have not come down from 2010.

Another option are thin-film solar panels which generate half the electricity and cost abouty 10% more than the standard flat panels, but have the advantage of being lighter and being more flexible in shape.

For now, research the sources offering solar panels and program costs. Going Green is good for the environment, but it does have costs attached.

Rebates - City of Long Beach for solar water heat
                City of Los Angeles for solar panels
Southern California Edison also offers a program for its customers for home or business use.
For additional federal tax credits and additional savings, see the information at U.S. Department of Energy.

Saving Water is Saving Money, Also, Its Not Wasting Water

Since we're watching TV ads about honest talk about what goes on in the bathroom, this seemed like another good conversation to have. 

A typical household uses 185 to 300 gallons of water a day and the majority of it goes down the drain from the toilet and the shower. One person alone may use about 80-100 gallons per day.  The toilet can consume about 26% of total daily water usage. Updating your commodes will serve as a conservation effort while also lowering your water bill.

If your toilet flushes 3.5 gallons per flush, one person may use as much as 19.5 gallons per day. But if your toilet flushes 1.6 gallons, that usage may be reduced to 10 gallons per day. Today's toilets use less water, prevent staining and resist clogging better than the older toilets--which saves on plumber's visits--and they are easy to install (although I recommend using a plumber to do it).  Good replacements generally cost from $150 to $300.

Until recently, I was one of many households with pre-1992 appliances, but I have just completed a replacement of a 5 gallon-per-flush toilet with a 1.6 gpf, and a new reduced-flow water faucet, so I know I'll be saving water!  Many older homes have older fixtures which, if replaced, will save a lot of water and reduce water bills. The early 1.6 gpf models were problematic in the 1990s, but those made today are much improved, and are easily found at the large home supply stores, you know the ones.
Toilets made in the 1950's used, on average, seven gallons per flush. Compare that with one that only uses 1.6 gallons per flush and it's a big saving. Multiply by the times a toilet is flushed in a year and the number of toilets in your home and it will save a lot of water.  The chart shows how usage changes depending on type of commode.  (1 gallon = 3.785 liters.)

Handling the Stress of an Unaffordable Mortgage Payment

Whenever I research the latest foreclosure and distressed property statistics, the sheer number of Americans facing the stress of losing their homes amazes me. For the month of June per the MLS, 148 single family homes and condos sold as an REO or short sale property in Long Beach, out of a total of 316 sales for the month.

It is my goal to help as many homeowners I can either stay in their homes or relieve the burden of their mortgages. Knowing that there are so many that need my help is a driving force for me to continue doing what I do.

In fact, I just released another report that I’ve made available on my website today. It explains the CDPE designation and lists 10 options that homeowners can take advantage of to relieve the stress that comes with owing their mortgage lenders more money than they can afford to pay.

The report also draws a contrast between short sales and foreclosures. Unfortunately, there’s a growing trend of “strategic defaulters” who think it’s smart to let their home go into foreclosure. As any one who follows this blog knows, there is nothing strategic about foreclosure; it’s one of the most long-lasting, negative financial challenges you can go through. A short sale seller who can legitimately show a hardship will avoid the post-foreclosure consequences.  Just recently signed into law in California was SB 458 which took effect immediately and which "extends the protections of SB 931 (2010), to ensure that any lender that agrees to a short sale must accept the agreed upon short sale payment as payment in full of the outstanding balance of all loans," so that no first mortgages (signed into law earlier) and now no junior liens can be pursued later if the lender agreed to the short sale. This makes it even more worth it to examine the possibility of pursuing a short sale.
I’m excited about acting as a resource for more homeowners who have questions about what they should do. As always, if you know homeowners who may need my help, have them contact me immediately! Together, we can put them back on the path to financial stability.

Good News for Short Sale Sellers and Junior Mortgages (and How Jerry Brown Used to Look)

Finally, short sale sellers in California and the Long Beach/Los Angeles County area have more protection against deficieincy judgments.  Senate Bill 458 was signed into law on July 15th by Gov. Jerry Brown, effective immediately. This was previously turned down by former Governor Schwarzeneggar, but is now made part of the protections of SB 931 which was passed into law as of 1/1/2011.

This means that if you have a second loan on your principal residence and the holder of the junior lien agrees to a short sale, there is no "deficiency judgment to be requested or rendered for senior or junior liens after a short sale of one-to-four residential units", per the California Association of Realtors. Additionally, this law does not appy in situations of fraud or waste (deliberate damage), it applies to residences, and does not apply to corporate owners, LLCs, and a few other exceptions. Previously, the protection was against first mortgages only, but is now extended to the seconds and other junior mortgages.

Should You Pre-Pay Your Mortgage

Have you recently considered taking action involving one of the following mortgage issues?

•  An increasing number of homeowners are opting for higher monthly mortgage payments on shorter loans, but with interest rates at record lows and property values still in flux, that may not always be the best decision. In other words, investigate the difference, for you, between a 15-year mortgage vs. a 30-year mortgage, or a 5-year fixed option if you plan to stay no more than 5-years.
• Choosing to pay down a mortgage ahead of schedule by paying extra money at a refinancing or by choosing a shorter-term loan may not be enough to offset what the money could have earned if invested in the markets, according to financial advisers.
•  Paying off a mortgage early, at the expense of other, more liquid savings and investments, could also stifle cash flow, especially in retirement. Once a house is paid off, in order to access its value, the owner would have to sell, get a line of credit, or take out a reverse mortgage to access the equity.
• Financial advisers recommend that home owners only consider pre-paying their mortgages if they already have an emergency fund of at least six months to a year in cash, have other retirement savings, and plan to stay in the house for at least five to 10 years.

Home Improvement Trends In Energy Efficiency and Exteriors

• 

  7 Hot Home Improvement Trends that Make Your Home Work for You

  Home improvement trends embrace energy efficiency, low maintenance exteriors, and double-duty space. Read

Visit houselogic.com for more articles like this.

Copyright 2011 NATIONAL ASSOCIATION OF REALTORS®

Is Your HOA FHA-Approved?

Many homeowner associations in Orange County and Los Angeles County are experiencing certain problems, and these problems could lead to more difficult-to-sell units in an already-soft condo market. For example, some loans are not getting approved for conventional Fannie Mae financing at the close of escrow due to too many owners being delinquent on monthly dues. As times become tough, and owners have to short sell, or go into foreclosure, the associations are not able to collect the scheduled income, and lowered reserves are a concern to lenders.

While associations are not required to have special approval for conventional loans, HUD now requires complete project approval before an FHA loan may be given. And the advantage is that sellers have more potential buyers with this approval, many more. FHA loans have made up 50% of the market in some areas, because they fit the 1st-time buyer's budget with 3.5% down payment, and 1st-time buyers are the majority of buyers in some markets, including condominiums.

If your association is up for renewal for FHA loans, or your association would like to be FHA approved, the following factors are essential for project completion:

1. Owner occupancy must be 50%.
2. No more than 15% of the units can be dues-delinquent over 30 days.
3. No one entity or person may own more than 10%--this is a problem in a 12-unit complex where 1 person owns 2 units, and this is not uncommon in areas such as Long Beach and San Pedro.

4. No more than 50% of the units may be FHA insured.

5. No pending litigation which adversely affects the entire association (collection and foreclosure litigation does not make the HOA ineligible).

HOAs must provide the condominium documents, along with certain information, and if eligible, the process may take about 60 days or more. This approval can help out owners who wish to refinance as well. You don't have to be selling in order to start the approval process, in fact, it's far better if the association obtains it before units go on the market, or an owners attempts a re-finance.

To be approved will usually cost about $1500 to $2000. For more information on documents HOAs provide, and help with finding a source, please contact me to find out where to get started. Some lenders will provide the approval if they are the source of your loan.

Will Lower Loan Amounts Hurt Some California Sellers?

July 1 was the cutoff date for loan limits that exceed the permanent loan limits. In case you've forgotten, the upper limit of $729,750 for conventional and FHA in California was a temporary accommodation. The permanent loan limit is $625,500 as of October 1, 2011.

This change is projected to have the biggest impact on the highest-end counties,  i.e., Marin and Contra Costa Counties, but also Riverside and San Diego Counties are not far behind, where 11 and 12 percent of the (non-FHA) home sales would be rendered ineligible. In Los Angeles County, about 2.3%  loans would be rendered ineligible, but Los Angeles County also represents 25% of the state's households.  The lower limits for FHA loan in Los Angeles County would impact about 5.4% of the loans.

All told, the changes could affect 30,000 California families. If liquidity in the high end market becomes slower than it already is, where do the move-up buyers move to if their eligibility is tougher, and where do the condo-to-house buyers move to in the lower range when fewer properties are put on the market?

One loan limit for the entire country cannot be right--the West Coast market rose above the national level years ago, and the current loan limits recognize that. We need to keep the high-end market moving, so the rest of the housing market does also.

Issues raised to Ben Bernanke, Federal Reserve Chairman, in a House Committee hearing July 13:

Ackerman then asked Bernanke how Congress should reconcile the possibility that many homeowners will not buy homes in this higher bracket when they would otherwise be qualified to do so.  "I don't have an answer other than to say that we have to get our housing finance system back into working order," Bernanke said. 

Researchers from George Washington University have said the FHA already exceeds the market share needed to serve its targeted demographic of low- to middle-income homebuyers. And, a separate report from the National Association of Home Builders suggests more than 17 million homes across the country will become ineligible for cheaper federal funding – at a time when the housing market continues to struggle.

The truth is, they're really not sure what works and what is needed, and getting the finance system back in order sounds good.

Missing Mortgage Payments? It's Not Too Late

Wondering what a homeowner should expect when payments are missed? The most important thing to know is that no matter what stage of default a homeowner is in, there is almost always a way to avoid foreclosure. That being said, the quicker a homeowner does something about the situation, the less challenging it will be to resolve.

First, here’s what a distressed homeowner should expect to happen when payments are missed:

30 Days Late: The lender will attempt phone contact or send a notice in the mail.

60 Days Late: The lender will attempt to make contact by phone and follow up with another letter in the mail.

90 Days Late: The lender will send a letter demanding all past due amounts within 30 days and start the foreclosure process.

120 Days or More Late: The lender’s attorneys will take over and the homeowner will be responsible for their fees in addition to missed mortgage payments and the loan amount due.

Not late yet, but about to be?

Homeowners who are not yet late but foresee missing payments should communicate this to their lenders as soon as possible. In the past, many banks wouldn’t work with homeowners unless they were one or more payments behind. In light of the mortgage crisis, most lenders would now rather take a proactive stance and decrease their loan losses. They are more willing than ever to work with homeowners to avoid being late.

If you are visiting my website at http://www.juliahuntsman.com/distressed-property-resources-short-sales.html and you or someone you care about may miss mortgage payments in the near future, please contact me. I can help navigate the process and put you back on a path to financial stability. Contact me today and alleviate the stress that comes with unaffordable mortgage payments. Find out what your options are.

Looking for a Home Plus Guest Quarters Under $350,000? It's Here!

This upgraded and remodeled single family home the Circle Area of Long Beach has a lot of advantages for a new homebuyer because there's so little work to do! 

Who wouldn't want the upgraded bathroom, and the new kitchen with granite counters and recessed lighting, complete with the cooktop range with downdraft feature? Hardwood floors, dual-paned windows and a roof (2005) in geat condition help a new buyer get settled quickly. 

Verizon FiOS is already installed for state-of-the-art connections.

The nicely landscaped yard is completely enclosed, and patio areas are paved with Saltillo tiles. The side yard is good for play area or a dog run.  And, though it's not permitted, there are additional guest quarters of approximately 175 sq. ft. with bathroom which makes a great office space or a third bedroom also!

Two-car garage with laundry hookups. For current listing price for 3100 Spaulding St.,  See listing here..

Please call me for more info!  Julia Huntsman, Broker, Lic #1188996

Note:  This listing is off market.

Lower Loan Limits and a Higher 20% Minimum Down Payment?

Without an extension or permanent change enacted by Congress, loan limits will decrease from $729,750 to $625,500.  Couple that with new demands for a minimum 20% down payment for conventional loans and strict debt-to-income ratios, and there could be a very sad situation.

In many states these changes may not change too many people's lives.  But in California where the market has for years been higher than other areas of the country, those changes could be critical, decreasing ability of buyers and sellers to purchase and sell, and hurting the recovery of our market. There are 27 California members of Congress who have spoken out against these changes. Everyone should know how their homebuying or homeselling future could be impacted by these changes, and possibly be shut out of the market.

And to make matters more confusing, there have been alternate proposals, and different ideas of what defines a Qualified Residential Mortgage, meaning those mortgages that could be exempt from the new rules. While it may have started with good intentions, these new rules, if passed into law, could have unintended, unknown effects.



Know Your Local, Local Market: A Call to Confidence, for Buyers AND Sellers

Don't short change yourself.

Sometimes people act as if they are just looking for a reason to feel bad, and any attempts to correct, or just gently push away, negative assumptions are met with even stronger resistance.  Twice in four days, the negativity virus has struck people I'm talking to. (The open house rate can be much higher.) One person believed he has the worst looking house possible and that it will never sell, when in fact, a few immediate corrections, including some paint, costing $1000-$1500 would probably put the home on its path to a motivated buyer in at least his house price median. Unfortunately, this owner has fallen prey, over and over, to the repetitious negative media message about "the bad market", all the while knowing nothing about his neighborhood statistics. He couldn't believe he actually had an opportunity somebody out there is looking for: a solid little house with a large back yard in a nice neighborhood under $350,000. Instead, he was looking backwards at perceived complications and difficulties, not forward into the light of a sold property. Maybe he's just not ready, but just in case he's reading this, the light of a sold property can be a very happy light.

This is the real job of a real estate agent: educating the client, which in turn would fire them up with more enthusiasm and motivation about taking action. It's a shame to see a person get into a real funk, a downward spiral of mopiness, when I'm hearing there are buyers looking and looking for certain opportunities. Repetition of the message is where it's at.  The media knows this, and feeds on the human tendancy to embrace fear.  So Realtors have to know it also: We have to be prepared over and over, to show, act and tell wherever and whenever, the postive truths about a client's local market, and show them what solutions could work best for them, over and over. You can't convince someone of something they really don't want to be convinced of, however, repeating things over and over is the key to all learning. Yes, it's a challenge. 

I tried to explain to my prospective seller that the first time buyers are out there in great numbers, in fact, in Los Angeles County, about 60% of first time home buyers can afford a median-priced home (at the height of the market it was about 10%).  At the end of 2010, the LA County median priced single family home was $323,000 (per CAR), and for April 2011, it was $333,000 (per tax data).  And then I tried to explain that investors with all or 50% cash have been very strong in the market also, composing 30-50% of all sales in some markets, actually making it tough for the first time buyers who get outbid.  So Mr. Seller, for the right property in the right area, there's competition out there. Our unsold inventory in Long Beach is recently at 2-3 months (that used to be called a seller's market), the housing affordability index is now where it was in 1999 and 2000. The trickle up effect is that the higher end homes are selling more--those over $750,000 in Los Angeles County have decreased in supply of inventory compared to one year ago.

Just give peace a chance.

Single Family Sales--Market Snapshot for May & Past 12 Months in Long Beach

Date: Avg price Dec 2010 to May 2011
'Single Family Residence'
 'Long Beach'

The most sales of single family homes in Long Beach within in past 2 years is in the $200,000-$300,000 price range: a total of 1,347. The top selling area in that price range in the last 12 months was in North Long Beach, with 821 closed sales in the last 12 months, and continues to have the highest sales volumes for May, at 71 sales, in the same price category!

Based on a group of 60 listings, Bixby Knolls/California Heights area averaged $562,025 in May with 25 sales, with the Plaza and Los Altos areas at 21 and 20 sales for May. The top 5 areas in average sales price for May are Belmont Heights at $878,900, Belmont Shore/Naples at $842,000, Park Estates at $749,000 (4 sales), Bixby Knolls/Cal Heights, and Lakewood Village at $544,000. Remember, these monthly average sold prices are based on properties sold during May, and are not their list prices.
Overall, the chart, based on MLS data, shows an  upward trend--with monthly variances--in average price since December 2010 for the City of Long Beach.

New Listing: 555 Maine Ave., 309, Emerald Villas, downtown Long Beach

 Looking for that desirable "under $200,000" price? You have found it here. This is such an attractive east-facing unit in the Emerald Villas, bright and sunny in the mornings. Besides a great floor plan that features a master bedroom/master bath, plus a 2nd bedroom with a hall bath, inside laundry, and a third floor view, the buyer also receives all the appliances (microwave, refrigerator, stove AND stackable washer/dryer). The living room features a gas fireplace, and floor-to-ceiling beveled-seam mirrors on its entire south wall, plus Pergo flooring. Although it's not needed that often, this unit also has central air and heat. This is a nicely maintained unit that has been recently carpeted (bedrooms), painted in the last 2 years, with newer appliances since 2007.

If the buyer needs a loan source, I can possibly help with a source that provides 3% and 5% down conventional for condos. The building is currently FHA-approved, but its status for FHA after July 31 is unknown at this point. The HOA common areas include rooftop deck, central atrium pool and spa, and exercise room. HOA fees on this unit are $245/month and includes two side-by-side parking units. Location is near an elementary school, and all downtown amenities, including the Aquarium, Convention Center, and nearby freeway access.

Take advantage of this opportunity! These units sold in the $350,000 range in the high market. To see more on this unit, go to Long Beach Homes and Condos.  Now listed at $179,000! UPDATE: This unit is now re-sold.

Credit Impacts on a Short Sale? You Make the Call

I try to help people with this question: short sale or foreclosure, which is the better option? For most people, my reaction is, “Short sale, of course!” This has been mostly because I was always under the impression that a short sale, although still a ding on your credit, was easier on the score than a foreclosure.



But for some time, other sources have been saying, and according to a recent blog post by FICO Banking Analytics, that there is no real difference in the effect a short sale or a foreclosure has on your credit score. Supposedly, both the impact in points and the time to fully recover is about the same for both events.


But all this time I believed that the short sale was superior to foreclosure, largely because of its less adverse effects on credit. So I was forced to do further research into which was the better option. In doing so I learned about benefits of a short sale I wasn’t even aware of, and found that the FICO blog was not true all the time for everyone.


The fact is, each borrower’s credit situation is different, and the way that a creditor reports a short sale to bureaus is different. The reality is that hundreds of thousands of distressed homeowners who have chosen a short sale have experienced a lesser impact on their credit than those who have chosen foreclosure. One of the differences, for example, is how long the borrower had been delinquent on payments prior to the short sale, along with other credit factors.


And, another very big mitigating factor is that in a short sale, a distressed homeowner may be able to obtain another mortgage sooner than someone who has a foreclosure on his or her record. Did you know that more and more employers pull credit before hiring a potential employee, and a foreclosure might keep you from getting a job. Some employers pull credit reports on existing employees, and a foreclosure may not bode well for job advancement in certain industries.
To see a special report, go to www.juliahuntsman.com/briefcase/29690_526201142402PM32754.pdf  which can be downloaded.

These benefits stacked against the negatives of foreclosure, including the embarrassment of public announcement and literally being kicked out of your home, make, in my opinion, short sale the reigning champion.



Now you make the call!

Common (and Costly) Mistakes Borrowers Make

Getting a mortgage can be daunting, especially when there’s a lot of your hard-earned money at stake. It’s critical to spend a few hours researching how a mortgage works (or at least as much time as you’d spend researching a vacation or a car purchase) before you begin the process. Unfortunately, nearly half of prospective home buyers don’t understand essential mortgage information, according to a recent mortgage survey conducted by Zillow Mortgage Marketplace. This lack of basic knowledge is likely leading borrowers to make costly mistakes. Here are some of the most common mortgage misunderstandings, and how to avoid them. My comments are in italics--Julia.

Buying Mortgage Discount Points – Nearly half ( 45 percent) of those surveyed in the Zillow poll believe they should always buy discount points when obtaining a mortgage. However, because mortgage discount points have an upfront cost that can be recouped through a lower interest rate over the life of the loan, the decision should depend on how long you intend to own the home. In some cases, you may not plan to remain in the house for long enough to break-even after buying points. A discount points calculator can help you do the math.

Not Monitoring Rates - Mortgage rates can change multiple times throughout the day, similar to how stock prices fluctuate. But more than half (55 percent) of the people polled thought rates were set one time each day. To get the optimum rate, it’s important to monitor rates and talk to different lenders. When you compare various rates make sure you are comparing the exact same loan. I find prospective buyers with loan quotes or pre-approvals obtained 6 months or one year ago, thinking the terms will still apply! No, they probably won't.

Contacting Just One Lender – Many buyers believe lenders are required by law to charge the same fees for credit reports and appraisals. One-third (34 percent) of survey respondents do not understand that lender fees are negotiable and can vary by lender. Borrowers can save money by reaching out to several lenders and comparing rates and fees. Online services which allow for comparisons to various lenders can be a helpful start, but your story may not quite fit the online scenario which are generalized estimates. And trying to change lenders in the middle of your escrow may not be possible, so you should do your homework up front.

Not Considering Various Loan Options - Many people may automatically avoid certain loan products, like Adjustable-Rate Mortgages (ARMs) because they don’t understand how they work. For example, when asked if interest rates on 5/1 ARMs always reset to a higher rate after five years, the majority of those polled (57 percent) said yes. In actuality, after five years, the rate could increase or decrease, meaning that there’s a possibility for a borrower’s monthly payments to go down. Whether an ARM makes sense for you depends on your personal situation such as your appetite for risk and how long you plan to live in the home. As you consider different loan products, ask your lender to go through the worst-case scenarios to avoid any surprises during the life of the loan. This can be a very helpful step, along with being open-minded to hear and consider ALL possible options for you.

Not Knowing Basic Terms – As you begin to think about securing home financing, you may hear terms like "FHA loans" and "pre-qualification" get bandied around. According to Zillow research, many people don’t know what those terms mean. Forty-two percent of prospective home buyers thought only first-time buyers could qualify for FHA loans, and 37 percent believed if they pre-qualify for a loan it means they’ve secured financing. Familiarize yourself with basic mortgage terms before reaching out to a lender. Most importantly, don’t be afraid to ask your lender, or even your real estate agent, lots of questions about the loan throughout the process.  To"pre-qualify" for a loan does not mean you've secured financing, and neither does "pre-approval" (the preferred step to take), because loan approval is still ultimately contingent upon all the necessary lending steps being taken to fund the loan at close of escrow, including appraisal.

See article at Real Estate Insider News:  Common (and Costly) Mistakes Borrowers Make

Long Beach Single Family House Sales in April 2011

For the top ten sales areas (by numbers of sales), for both April 2011 and April 2010, does it look like we're having more houses sold? Yes!


April 2011 Long Beach House Sales

Based on a total of 130 listings for April 2011 and about 83 listings for April, 2010, these charts are the picture of activity for these areas.  The most sales in April 2011 (in this chart) took place in the Bixby Knolls/California Heights area at 38 sales closed, at an average selling price of over $449,000. Belmont Heights shows 20 sales at average of $631,000 and 21 sales at a $455,000 average in the Plaza/Ranchos.

April 2010 Long Beach House Sales

This seems to be a downward price shift and an upward shift in sales, from last year's lower number of sales and higher prices.  Last April the emphasis was on Belmont Heights/Alamitos Heights area which had a total of 19 sales at an average of $862,000 selling price, followed by 2 other areas with averages of $546,000 (Lakewood Plaza/Ranchos) and $481,000 (Los Altos areas).



In fact, Altos Research indicates for THIS WEEK, there is a decrease in days on market for all of Long Beach residential properties, currently the average is 150 days, a decrease from prior weeks. (Some properties are getting offers in 7 days after hitting the MLS.)

Will there will be a point where lower price and increasing number of sales signals triggers the opportune time to buy for an even greater number of buyers? If you think this is the critical time for you in one of these areas, or another, call me to find out how I can assist you!