Moving Forward or Still Going in Circles?

With more properties now receiving offers within days coming on the market, multiple offers, and selling over list price, at least some smart buyers are beginning to understand a current reality. They are having to compete against investors, or against other buyers who have more cash than they do. The days of casually looking, window shopping and low-ball offers should be left behind as quickly as possible. Thinking that the mountain will come to Mohammed, as wishful thinking takes over pricing reality, should be done with. It is time to stop moving in circles, the one where offers are made, lost in the multiple offer shuffle, then repeated again at the next property where the cycle repeats itself, over and over again.

It is time to move forward.

It is time to make the winning bid. To make the winning bid, a realistic property has to be chosen, and that realistic property may be one which doesn't look so attractive initially, but is in the right area, and for which suitable financing is available. Perhaps it will require a higher down payment, or an FHA rehab loan. Otherwise, choosing the price you want in an area you don't really feel certain about, and then expecting the seller to reduce the price to your lowered expectations, is sheer folly. It is time to move forward.

There's been much talk about the REO properties that will hit the market, perhaps before the end of this year. And will they bring a new low in bargain prices? That's the way many buyers continue to act. But there's so far been evidence supporting stabilization in prices, if not a regional increases in price. A 3% increase in the West according to the Clear Capital Home Data Index report discusses how the momentum built in recent months could carry over into REO properties placed on the market in the future as buyers worry they are missing out on the bottom of the market.

The time for the $8000 tax credit is still in effect until December 1, 2009. Whether you're interested in houses, condos or units, please contact me. I can help you move forward.

Fewer Homes to Buy as Sales Increase, Prices Jog Upward

Various industry sources have reported that June, 2009 showed the highest California median price this year at $274,740 (statewide median). June sales showed at 20 percent increase over the prior year. The statewide unsold inventory in June was at 4.1 months, locally the figure is even lower. Per the July 2009 report from California Association of Realtors: "The index is now 3.5 months lower than a year earlier and well below the peak of 16.6 months in early 2008. In fact, low inventories may constrain sales and contribute to upward pressure on home prices through the rest of the busy season."

The higher end properties are accounting for more sales, with properties below $500,000 accounting for about 76%, down from 85% at the beginning of the year. From March to June, the market share of distressed properties declined, contributing to the increase in median price.

Los Angeles County median sales price, July 2009, at $340,000; Orange County median at $490,000.

News about Southern California from Dataquick as of August 18th:

"In the region’s more affordable areas, many first-time buyers continued to choose government-insured FHA financing. Such loans were used to finance 37.2 percent of home purchases last month, up from 36.9 percent in June and 19.7 percent a year ago. "

"The recent drop in foreclosure resales, coupled with the rise in high-end sales, has helped stabilize some of the regional home price measures. But there’s still quite a bit of distress out there, and plenty of unknowns with regard to how lenders and borrowers will choose to proceed,” said John Walsh, DataQuick president.

And probably the most telling comment about the future:

“Even if we are at or near bottom,” he added, “history suggests we could bounce along that bottom for quite a while.”

Sales Increasing Now, What Will Next Year Bring?

There is a great deal of talk lately about the upward climb in sales, that maybe we're seeing the bottom of the market, and that prices are down from this time last year, but it's the 5th straight month of sales increases, and the best sales record in several years . . . so maybe prices are stabilizing, or even headed up a little? That's happening in some places, and yesterday's great REO panel of experienced brokers even said it's impossible to underprice a property today because it will get multiple offers and sell for more.

But take a look at the Credit Suisse chart at the right and the pink part of the graph--the reset of the "option adjustable rate" loans. Those are the loans where the "start rate" of 1% were thought by many borrowers to be their permanent loan rate, and not the introductory rate which if always paid at that payment level (and most people did that), meant the remainder of the interest of the real interest rate was added on to their principal loan amount and thus increasing it. It was one more way to end up "under water" on the home value, and end up as a loan modification customer, a short sale candidate, a bankruptcy claimant, and/or as a foreclosure recipient. And then, most importantly, notice that the reset periods do not decline until well into 2012.

Along with the recent sales increase is declining inventory: In Long Beach today there are 877 active residential listings in the MLS, and there are 753 in escrow. Also, as of 8/18/2009, there are 1910 Notices of Default filed, 1224 Trustee Sales filed, and 1426 REO properties, not on the market yet, making a total of 4,560 properties not yet on the market. (Some of the NODs may have successful loan modifications, but there is also a separate study of the percentage of loan mods that end up failing and do end up in foreclosure.) These figures are for Long Beach alone--similar profiles could be drawn for cities throughout the State of California.

Tied in with this is the talk of "shadow inventory" and the rumors that banks will flood the market with all of their pent-up inventory at once. But that is unlikely to happen in such an overt way, despite the hope of many prospective buyers who believe a $400,000 house might eventually sell for $25,000. Received yesterday in my e-mail from DSnews.com:

Perhaps it’s “government pressure to clean up balance sheets,” or the thawing out of home sales, the need for capital, or the growing pool of players in the mortgage-backed assets market. Whatever the motivation, more banks are beginning to unwind their positions in toxic residential loans.

See this story about a Milwaukee-based bank that sold 800 troubled Arizona mortgages to an undisclosed investor, thus clearing $297 million of bad loans from its balance sheets. Will this trend catch on with major banks who decide to sell off in bulk to cut their losses? There seems to be more interest now by investors willing to acquire properties associated with "toxic loans".

The current shrinking inventory may be a combination of things: the loan modifications, the foreclosure moratoriums which have been delaying filings, and the ultimate decisions by banks as to the handling of foreclosed properties, plus the "catching up" with loans in default for months and that are yet to go into foreclosure. Those involved with the REO market believe that over time, perhaps as soon as in a few short months, the inventory will once again increase greatly, continuing to affect housing market prices, and the real estate market will not fully recover from the effects of the subprime market until 2012-2014, as indicated by the chart above.

So what should equity sellers do? Take advantage of this period of time, and realize that now, when there is less competition and many cash buyers (accounting for one-third of the multiple offers on many REO properties), may be a better time to sell than a year from now, when you could end up being a short sale if your equity continues to decline with the market. In some areas short sales and bank-owned properties already dominate the inventory; in the last year certain zip codes that seemed immune, or less impacted, to these issues are now common, such as:

• In 90803, 23% of the 177 active and pending listings are distressed sales
• In 90802, 68% of the 280 active and pending listings are distressed sales

and in the future, if the local and statewide foreclosure statistics are any indication, distressed sales will impact equity sales even more severely than they are now.

If you would like to know about the current market value of your home, please contact me. To see properties on the market in your area, you may search by zip code or city, price, etc., at the MLS property search button at http://www.juliahuntsman.com/.

Have Your Documents Ready When You Call Your Lender

Are you at the critical point of "do I stay or do I go?"

In California, there are currently about one-third of all mortgages "under water", so many borrowers are contacting their lenders concerning loan modifications, or payment catch-up, their pre-foreclosure status, or a combination of all three. Borrowers are frustrated with the amount of time it takes when they contact their lender. Some banks are gradually become more efficient as they are assigning more people to their loss mitigation and loan modification efforts. Banks are still very swamped, and the average consumer is unaware of their low staffing and high demand.

To find a faster answer on which point of action you need to take, and to save yourself and your mortgage servicer precious time, when you call you should have ready:

• The most recent monthly mortgage statement


• Pay stubs or other documents showing your household's monthly pre-tax income


• Most recent tax return


• Second loan or home equity line of credit statements


• Account balances and minimum monthly payments on credit cards, car loans, student loans or other debt.


• A short, concise description of the financial hardship that is causing - or leading to - a mortgage delinquency.

See this Freddie Mac video posted on their site and on YouTube: Stop Foreclosure--Documents Your Lender Needs -- it's had over 4,000 hits in the last 30 days.

If you have decided you need to consider selling as a "short pay" (not all loan modification requests are granted by banks), please contact me for a market valuation and information on how I can help you with the process. Typically, different bank personnel involved in a short pay approval are other than those you may already have been dealing with on your loan modification effort, but your information you have gathered up to this point may save you some time.
Contact me for more information.

How To Be Beautiful with Dry Gardens in Southern California

We love lawns, we love lush green semi-tropical plants, and we love them in dry, desertous Southern California because they grow so well here in this temperate and sunny climate.

But did you know? Lawns and outdoor landscaping consume as much as 49% of our water use in the Long Beach area. If you've seen my past blogs on the subject, you know that Los Angeles and other Southern California cities, including the other desert areas, have been concerned about water use for a long time--for decades, as a matter of fact. Yet, we persist in our East Coast style of landscaping brought here by our forebears. This becomes more expensive with the passing of time--Long Beach is scheduled to raise its water rates this fall, although residents have done well so far in reducing water consumption by 10% through the current city-mandated watering schedule restricting outdoor use to 3 days per week at certain times.

Lawns in particular had a purpose in the past, and it wasn't related to beauty. Lawns derive from the green pastures once kept by owners of cows, because back when we were a more agricultural, less industrial society, financial status and its production could be measured by the amount of land people owned, their crops and their animals. Cows needed green grazing areas, so the more cows one owned, the more pasture was required, and this over time became the foundation for our attachment to lawns, long after the cows disappeared from the average homeowner's life.

Today, we need to fit in with our natural climate conditions, as well as the current water shortage upon us. Beautiful Long Beach Landscapes right into saving money while creating beautiful gardens using native plants. The photos above are "before" and "after" of one house selected by a Long Beach landscaping program. Another great source is at BeWaterWise for landscape and planting ideas.

For more information, go to http://www.juliahuntsman.com/gardening-landscaping-for-home.html

Existing Home Sales Rise for Third Straight Month

It's starting to sound like a broken record but we keep getting more and more positive news about the housing market.

The National Association of Realtors reported that sales of previously owned homes increased at a faster-than-expected annual pace. Existing home sales increased at a 3.6% rate and had its third straight monthly gain.

This is the first time since early 2004 that we have had three straight months of increasing sales and points to the housing market continuing to heat up. They also reported that inventories of existing homes were down 0.7%. With inventories declining and home sales increasing, now is the time to jump into the market before these low home prices are history.


Which leads to another topic that has been making the rounds: that there is a "shadow" inventory held by banks which when released onto the market, will bring prices down even further. Not so fast, say some mortgage brokers I've talked to. It's very unlikely that large amounts of such inventory will be released simultaneously by banks. For one thing, major lenders are in the process of negotiating many loan modifications and would probably not release major inventory onto the market in any one area which could then depress prices, and their existing mortgage loans, even further. It could also depress equity sellers' values causing some of those to go into short sales if prices declined due to a flood of REO inventory.


The fact is, the $300,000 price range is and has been very competitive for investor buyers, and almost impossible for first-time owner occupant buyers for months now.


As the sales activity has indicated, what we need are more reasonably priced listings on the market. Sellers, are you listening?
See www.juliahuntsman.com for more real estate information.

How Many Condos are Listed in Long Beach Under $250,000?

About 4 years ago, someone left a comment/question on one of my blog posts asking where in Long Beach a condo could be found for $250,000. I don't know where that person is now, perhaps they have already taken the plunge into homeownership, but if not, now is a much better time for looking for that condo.

A search in all of Long Beach on the MLS shows 185 active listings for studios, 1, 2 and 3 bedroom condominiums at $250,000 or less. Typical of today's market, many are short sales, however opportunity knocks for the buyer who has the ability and patience to wait.

The Marina Pacifica complex shown above has several listings in the lower price range. and this photo features a listing (CLW-09378967) for a studio at $199,000 with HOA fees of $379/month.

When getting pre-approved for a condominium purchase, a buyer should be aware of items such as the HOA dues amount, number of parking spaces and their location, whether or not the building is FHA approved, building amenities, and association documents as spelled out in the contract.

In other associations, monthly fees may range from under $100/month to several hundred dollars a month, so it's important to find which associations will work for you.

Condo living is usually a closer community living than a house in a neighborhood may be. Condos are a great doorway to homeownership, and may offer an opportunity to live in a desired area that the buyer may not otherwise be able to afford.

Turn An REO Fixer Into Your Palace

DID YOU KNOW . . . .

THAT the foreclosure/bank-owned property (REOs) market is shrinking? There are several reasons for this, but basically, it may be the buyer's opportunity to get a very good deal on the right property under conditions acceptable to the seller.

THAT the County of Los Angeles' HERO program works with foreclosed/abandoned properties which may be purchased with a 1% down payment, and provides down payment assistance for low-to-middle-income households, for up to $10,000 of the purchase price. This program is for single family homes up to $493,000 and condos up to $394,250. Call me for more information on approved lenders and other requirements for this program.

THAT the Good Neighbor Next Door Program through HUD helps law enforcement officers, teachers and emergency medical technicians purchase an available home, at a very large discount. Teachers must be full-time in an accredited school, other personnel must be employed by a unit of the federal, state or local government, including an Indian tribal government. Eligible buyers may receive up to a 50% discount off the HUD appraised value, as well as an extremely low $100 down payment if the buyer qualifies for an FHA-insured mortgage. This program may be used in conjunction with the FHA 203(k) program also. Contact me for more information about this program. This program is for homes in one of many of hundreds of designated areas.

THAT the FHA 203(k) Residential Rehab Loan may offer financing in conjunction with several types of buyer program (but not all) and is a great way to gain up front financing to remodel or repair the home of your choice. If you find a fixer property in an area you would like, but the house needs work, this loan is a way to accomplish those repairs within your overall mortgage qualification, so that you're not paying for repairs out-of-pocket, but amortizing them over time. Repairs may include flooring, fencing, roofing, windows, foundation, appliances, heating, A/C and termite.

Turn a fixer into a palace. These programs are just some of the ways a first-time, or return buyer, may find a new home under very advantageous conditions.

PLEASE CONTACT ME AT JULIA@JULIAHUNTSMAN.COM FOR A LIST OF HOMES THAT ARE ELIGIBLE FOR THESE PROGRAMS. NOT ALL SUCH HOMES MAY NECESSARILY BE FOUND THROUGH THE MLS. I CAN ALSO HELP POINT YOU TO THE RIGHT AREAS THAT APPLY TO THESE PROGRAMS.

Long Beach Summer Park Concert Series

Long Beach Municipal Band
Summer 2009 - Centennial Concert Series
June 30th through August 14th
All concerts start at 6:30 p.m.

PERFORMANCE DATES AND LOCATIONS

WEEK 1 - (June 30 - July 3)
1909-1924: In 1909 the City of Long Beach announces the formation of the Long Beach Municipal Band! Through these early years the music of George M. Cohan, George Gershwin and other composers from Tin Pan Alley had America singing. The Studio Band and Barbara Morrison kick off the summer in style.

Tuesday, June 30 Whaley Park
Wednesday, July 1 Los Cerritos
Thursday, July 2 Marine Stadium
Friday, July 3 El Dorado Park
WEEK 2 - (July 7 - 10)
1924-1937: From the Roaring Twenties came great music like Ragtime and Dixieland jazz. George Gershwin wrote his “Rhapsody in Blue.” Even though times were tough during the 1930s it was a great time in American music. John O’Campo sings with the Studio Band.

Tuesday, July 7 Whaley Park
Wednesday, July 8 Los Cerritos
Thursday, July 9 Marine Stadium
Friday, July 10 El Dorado Park
WEEK 3 - (July 14- 17)
1937-1950: Americans danced to the music of the famous big bands such as Tommy Dorsey, Benny Goodman, Count Basie and Glenn Miller. The Swing Dolls as “The Andrews Sisters” will stop by with a special treat you won’t want to miss. Derek Bordeaux brings his high energy and soulful Motown sound to the parks of Long Beach.

Tuesday, July 14 Whaley Park
Wednesday, July 15 Los Cerritos Park
Thursday, July 16 Marine Stadium
Friday, July 17 El Dorado Park
WEEK 4 - (July 21 - 24)
1950-1965: Duke Ellington records with the Count Basie band and Ella Fitzgerald records eight records making up the “Great American Songbook.” Elvis Presley, the “King of Rock ‘n’ Roll” has three records which sell over one million copies. Our own first lady of song, Barbara Morrison, returns for a second set with the Studio Band.

Tuesday, July 21 Bixby/Bluff Park
Wednesday, July 22 Los Cerritos Park
Thursday, July 23 Marine Stadium
Friday, July 24 El Dorado Park
WEEK 5 - (July 28 - 31)
1965-1979: From the Beatles and Stan Kenton to John Williams and Stevie Wonder the tumultuous ‘60s and ‘70s produced an overwhelming variety of musical genres. During this remarkable time The Carpenters started their singing careers at Cal State Long Beach. Carol Welsman sings with the Studio Band.

Tuesday, July 28 Bixby/Bluff Park
Wednesday, July 29 Los Cerritos Park
Thursday, July 30 Marine Stadium
Friday, July 31 El Dorado Park
WEEK 6 - (August 4-7)
1979-1995: The 1980s continued to bring major changes in the music scene; the invention of the CD and MTV! In musical theater, Phantom of the Opera attracts record audiences. "Porgy and Bess" finally receives its acceptance as world class opera with its first performance by a major company, The Metropolitan Opera. Jackie DePiro sings with the Studio Band.

Tuesday, August 4 Bixby/Bluff Park
Wednesday, August 5 Los Cerritos Park
Thursday, August 6 Marine Stadium
Friday, August 7 El Dorado Park
WEEK 7 - (August 11-14)
1995-2009: Now it’s our time after 100 years of music. We look back on the unbelievable musical journey of the Long Beach Municipal Band and salute all who have come before. During this final week of the 2009 summer season you will hear the latest and greatest music of the stars of today performed by one of the finest community bands in the history of our nation - your Long Beach Municipal Band! Tony Galla will have the park up and dancing for a super finale with the Studio Band.2009.

Tuesday, August 11 Bixby/Bluff Park
Wednesday, August 12 Los Cerritos Park
Thursday, August 13 Marine Stadium
Friday, August 14 El Dorado Park


History
The Long Beach Municipal Band is one of the most distinguished and professional Municipal Bands in the United States. The player personnel in this wonderful ensemble includes the best of the Southern California's symphony, studio recording and jazz performers. This diversity of talent provides Long Beach audiences with impressive concerts of jazz, movie, musical and light classical literature. The Band also combines with talented guest vocalists weekly to guarantee that your family's summer evening in the park will be the highlight of the week.

The Long Beach Municipal Band has been entertaining area residents for 99 years. Its history is well known and appreciated not only in this community but also in music circles around the world. Present conductor Larry Curtis continues a tradition of musical excellence established by such notable conductors as the famous Sousa cornet player Herbert L. Clarke and composer J. J. Richards.

How To Avoid the 10 Most Common Mistakes Sellers Make

If you are thinking of selling, you should keep these things in mind. They are not new, but sellers often overlook things they think are not important, when nothing could be further from the truth!