Market Stats for 1st Quarter, Long Beach CA and Nearby Cities

Not surprisingly, with the low low interest rates, prices have climbed especially with single family homes.  Condo prices have varied, and do vary by zip code, especially in Long Beach where completely different areas have their own pricing.  All median prices in the chart below are for cities regardless of specific areas, and this chart is meant to show an overall trend for the 1st quarter of 2015:

MEDIAN SALES PRICES	1/1/2015	3/1/2015
Long Beach Single Family	$482,500	$540,000
Long Beach Condo	$310,000	$275,000
Long Beach Multi-Family	$599,000	$620,000
Lakewood Single Family	$443,500	$475,000
Lakewood Condo	n/a	$300,005
Lakewood Multi-Family	$452,000	$579,000
Cerritos Single Family	$602,000	$638,000
Cerritos Condo	$285,000	$453,000
Cerritos Multi-Family	n/a	n/a
Bellflower Single Family	$418,000	$395,000
Bellflower Condo	$300,000	$280,000
Bellflower Multi-Family	$550,000	$602,000

Data provided by Market Analyzer

New Transaction Closing Rules -- Starting August 1 by CFPB

Be Careful Crossing the Road of Financial Protection

The Consumer Financial Protection  Bureau was brought into being by the Dodd-Frank legislation, and the CFPB has teeth which are being inserted into the lives of lenders, and therefore the lives of home buyers and sellers.

The "Know Before You Owe" rule, effective August 1, 2015, is bringing a new closing document (6 pages) and is doing away with our HUD-1 statement (3 pages) in the form of a non-uniform closing package which does away with the uniform coded costs which have been in existence for . . . decades.  By non-uniform is meant that lenders can call their categories what they so choose, and therefore may be different from one bank to another all across the country.  On the other hand, "the new forms resolve the problem of redundant and overlapping information presented in the standard Real Estate Settlement Procedures Act (RESPA) and Truth In Lending Act (TILA) disclosures that lenders are required to send to borrowers following submission of a mortgage application and just prior to the closing." See, for a very indepth industry discussion, this article by Patrick Barnard.

One of the net results is that there's more pages to get to a closing, and the closing will probably end up being extended well beyond the initial escrow period IF there are credits back which must be given a 3-day period to sign on and disclose to the lender.  So if, for example,  the seller agrees to credit the buyer $500 for some repairs rather than perform the repairs, that will require a written documented disclosure to the lender, the total of such amounts may not exceed the lender's cap.  Such a $500 agreement between buyer and seller will require a new good faith estimate from the lender, which in turn adds to costs by some lenders.  Another fact of life is the cost involved for escrow companies and lenders to retool their technology because they will be required to be in sync on this process.

Since this is being  implemented on a national basis, it will affect procedures and laws in all states.  The bottom line for buyers and sellers is that a 30-day escrow may turn into a 45-day escrow, which impacts people's moving plans for making the smallest of changes.

More will be said here on this issue, but the bottom line for residential buyers and sellers is to grasp the transactional costs and fees, including termite inspection (very costly sometimes) and what they agree to agree on with each other in the beginning.  I can see a world of even more advance planning on both sides.

Water Heaters Are About to Cost Much More

If you need a new water heater, consider buying one in the next three weeks.

Effective April 16, 2015, water heater replacement rules will go into effect.  A new amendment to the National Appliance Energy Conservation Act will require higher energy ratings on all new residential gas, electric, oil and tankless gas water heaters.  The changes will impact how they are designed, manufactured, tested, distributed and installed, as many will be taller, wider and heavier than your current installation.  Because of the potential increase in size, the homeowner may have an additional cost of housing the new heater in a larger cabinet.

 According to  the U.S. Department of Energy, "Standards mandatory in 2015 will save approximately 3.3 quads of energy and result in approximately $63 billion in energy bill savings for products shipped from 2015-2044. The standard will avoid about 172.5 million metric tons of carbon dioxide emissions, equivalent to the annual greenhouse gas emissions of about 33.8 million automobiles."  For water heaters under 50 gal., this greater efficiency is achieved by adding more insulation (making it bigger).  For larger water heaters, heat pumps will be required, and some larger water heater may be discontinued because they cannot meet the standard.  In the end, there will be less energy consumed, but not before the consumer pays more up front.  Also, the self-help install program will just not work, licensed plumbers will be a fact of life.  

And according to EnergyStar.gov site at least 30% of a home's energy is spent on heating and cooling:

According to the Bradford White website "It is important for contractors to understand that products manufactured before April 16, 2015, can be bought and installed after the changeover date."  However, since production of the new standard units started some time ago, some stores have been stocking up for some time, so older manufacture dates may be harder to find.

To extend the life of your current water heater, drain it yearly, and if possible, add a water softener to decrease sediments.   For more information go to http://www.energy.gov/search/site/water%20heater.