Clearing Up the Loan Picture

Since I frequently hold open houses I regularly talk to prospective buyers. It's no secret that sales volume has dropped and that predictions abound about the coming drop in prices. I think one of the reasons for buyers holding off is because home shoppers feel like they're shopping in a store when the Big One hits, and suddenly their thrown into another aisle where all around them is shopper's chaos. Recent events in the subprime market have helped the speculation, but may this will add in some perspective about our current economy, which is, after all, still strong:

The Mortgage Bankers Association, in its testimony to Congress last fall, said that homeownership rates are at record levels, nearly 69 percent. It stands to reason that with a higher rate of ownership, there is a higher rate of foreclosure.

Delinquency rates typically peak 3 to 5 years after origination, which is in keeping with record home sales and record loans following 2001. In other words, this was to be expected.

Approximately 1 percent of all loans are in the foreclosure process, well within historical norms, according to the MBA. That’s still less than the post-recession peak of 1.5 percent just four years ago.

Three out of four loans that enter the foreclosure process will not wind up as a foreclosure sale, either because the home owner cures the delinquency, works out a payment plan with the lender, refinances, or sells the home.

Somewhere between 0.5 percent and 1 percent of all homes going into foreclosure are owned by subprime borrowers, according to estimates by Walt Molony, spokesman for the NATIONAL ASSOCIATION OF REALTORS®. On the low end, that's one home in foreclosure out of approximately 200, suggesting that high foreclosure rates are not just a subprime problem but due to a wide range of other causes.

Finally, subprime borrowers are higher risks and have always had a higher delinquency rate than prime borrowers. Yet, only six percent of home owners are nonprime borrowers with adjustable rate loans that are resetting to higher rates.

Long Beach

Housing Opportunity: Think About It

Industrial vs. commercial vs. housing use: This is one of the stories in Long Beach. As in some other cities, downtown Long Beach is building up its mixed retail/residential use most recently through loft conversions, and residential-over-retail use. But still, we have a housing shortage, not just here, but throughout the state--an estimated and predicted shortage that's been no surprise for at least a couple of decades to certain economists. It's supply vs. demand, and it's one of the reasons that the median price in Los Angeles County still increases at this point. While the inland counties such as San Bernardino and Riverside have suffered more due to foreclosures, the Long Beach area and the subprime loan fallouts is far less involved and remains overall far healthier, in spite of the increase in housing cost in this area. Downtown retail is still growing; the local office market is strong.

“We’ve obviously had a huge pull-back, but I think people feel there are opportunities on the horizon because mortgage rates are still quite attractive and there’s still a lot of inventory on the market,” Kyser says, “but at the end of the day, the irony is you still have an overall shortage of housing in Los Angeles County . . . of about 290,000 units, as well as a huge lack of affordable housing." Jack Kyser, chief economist of the Los Angeles County Economic Development Corporation.

It's still a good time for property buyers to buy, and to take the long term view.
Long Beach

Getting Your Home Insurance Lined Up

Home insurance coverage in California is important for everyone, but this article about Allstate Insurance is why homebuyers especially need to be vigilant. Insurance coverage for homeowners is cyclical, and depends on the disaster climate in which companies underwrite. Although they say they are no longer to give coverage, or coverage is contingent on certain factors being present, insurance companies have been known to change their minds later. Nevertheless, when you're in escrow, or even when you are house shopping, start researching possible insurance companies. There was a time when coverage could easily be obtained about 10 days before escrow closed, but that hasn't been around for a long time, and it's getting stickier. Your credit may be checked, and prior claims on the property you wish to insure may impact which company will insure you. There's really no time to waste for finding coverage before you close escrow. If you're obtaining a loan, it will be required by the lender, and you should get it regardless.

Number of Sales Goes With Seasons?

Condo sales by quarter



While all we seem to be hearing about is that sales are down, historically, the time of year has something to do with it, too.

If you compare 2007's condo sales for zip code 90803 (Belmont Heights, Bluff Park, Belmont Shore areas) as shown in the local MLS, with 2006's sales at the same time last year, even more have sold with about the same number expiring. Sold condos per quarter range from 23 to 42, with the second quarter of 2006 highest in sales. Although not reflected on this chart, the median prices from local tax data for Los Angeles and Orange Counties has increased over last year's prices.

While not exactly a scientific study covering all parameters, this does show sales are continuing actively in the current market. We'll see if the second quarter of 2007 echoes last year's.
Long Beach

Counteroffers: What To Do

It's not unusual, whether you're a buyer or a seller, to start feeling that the other side is being totally unreasonable, or that the price is too low from a buyer or the seller is asking way beyond a reasonable asking price.

Sometimes, buyers may get upset and refuse to make a second counteroffer back to the seller because they feel the seller just won't listen, especially if it concerns the price. It's important to keep negotiating at that point. Getting upset will only get in the way. Each party may have what they feel are totally valid reasons for their position, and if you can find out what those are (and this is where your Realtor works for you), at least you have an understanding of the other side even if you're ultimately not going to agree with them. Once the emotional level has dropped, it's easier to make a rational decision that you won't regret later if you do end up rejecting the deal.

If you feel you're backing down on an important issue, then don't. Explain why this is important to you so that it can be communicated to the other party. Possibly the other side will walk away at that point, but that possibility also exists during the contingency periods during escrow.

It's important that you know why you think as you do--it can make the difference between selling/buying the property or not.

Long Beach

Resale Homes Are Holding in California

In spite of all the negative media coverage about the housing market, the real truth in California is that the median price is strong.

As a matter of fact, it's 3.2 percent higher for March, 2007 from March of 2006. Sellers apparently are hanging on to their asking prices and still get a reasonably close sales price. In fact, according to the California Association of Realtors, the current median price of $580,090 for a single family home is 3.9 percent higher than the February 2007 median home price. And, though certain counties may be seeing a drop in their median, Los Angeles and Orange Counties' median prices have increased in March, according to Realist, the provider of tax data for the Southern California MLS. Even the Bay Area increased, reversing its decline from last year. Dataquick's data also provides the same picture as CAR and Realist data: Sales volume has lowered while prices are holdling.

Long Beach

L.A. Area Trends

Yesterday the Dow broke 13,000 for the first time, there's no sign of rents decreasing overall, and the median home price in Los Angeles County continues to increase so far for 2007. In spite of all the talk about foreclosures and subprime loans resetting in 2007 and 2008, California may only see a fraction of their delinquencies go into foreclosure because of preventive measures and assistance taken by the respective lenders.

Only a fraction of all delinquent loans will actually go into foreclosure because of measures taken by lenders to prevent costly foreclosures. For borrowers who face temporary problems, these include delaying payments for a short period of time or scheduling a lump sum payment in the near future. For borrowers with more severe problems, alternatives include short sales or mortgage forgiveness. At present, it is anticipated that the proportion of foreclosures in California should be near the long-run average of just under one percent.

Long Beach

Greenbrook in Costa Mesa

This Costa Mesa home in the Greenbrook tract is typical of the 1950's and 1970's ranch style houses favored by those who love open floor plans. Built by Larwin, the Greenbrook homes are located in Costa Mesa, Cypress and Fountain Valley--there's even a Greenbrook by Larwin tract at Long Island, New York where California ranch homes were popular for a while. This is the era of the cathedral ceilings and open kitchens adjacent to the family room. This model features 4 bedrooms/2 baths on a single story level, ample room at approximately 2100 sq. ft. Patio and private rear yard are attractive and neatly landscaped. Family room and the formal dining area make this home an entertainer's delight as well. This home is in an interior location of this quiet tract, yet very close and convenient to South Coast Plaza shopping and the 405 Freeway. It's ideal for less time spent commuting for daily needs. For more information, contact me, or go to my website's property search to find other homes in Costa Mesa.
Julia Huntsman, Broker
01188996


Long Beach costa mesa orange-county

Foreclosure Impact

Deep Impact: Foreclosure Surge in California. A surge of foreclosures in California has some economists concerned that the fallout will be long lasting and potentially wound the whole economy. The 11,033 foreclosures in the first three months of the year represent an 800 percent increase over the same period a year earlier. "For this rise in foreclosures to be happening in the midst of a strong labor market is truly unique and scary," says analyst Christopher Thornberg of Beacon Economics. He predicts foreclosures will top out at four or five times the current level — enough, he says, to induce a recession or at least bring the economy to the precipice.Others are less pessimistic. "The housing sector is in trouble for a considerable period," says Edward Leamer, director of the UCLA Anderson Forecast. "But the rest of the economy will muddle through." Source: Los Angeles Times, David Streitfeld (04/17/07) & REALTOR® Magazine - Daily News.

This article is like many others: It simply does not mention the big picture--for instance, what is the percentage of foreclosures of total mortgages in the state of California, or the U.S.?

"The truth is that 99% of all loans in the U.S. are not in foreclosure. The remaining 1% that were foreclosed upon had the following breakdown:

* 80% were classified by federal lenders as Professional Thieves and were turned over to the FBI.
* 20% were classified by lenders as Fraud for Property that resulted in unethical lending practices.
* Ca. Defaults: Historical 32,762 - Low: 12,145- 3Q ’04 High: 59,987 – 1Q ’96 Current: 37,273. [NOTE: February '07 data.]
* For all of ‘06, foreclosures accounted for only 1.81% of all Orange County sales, with lenders reselling those homes at an average discount of only 3.8%!" Gary Watts, http://www.impactre.com.

long beach ca mortgage california foreclosure

Home Price Up Over $500,000 Median for L.A. County

Los Angeles County's median home price (including houses and condos) is over $500,000 for March sales.

"If nothing else, the long-awaited downturn seems a little tardy — at least in most of Southern California.

"The perception out there is that we're at the edge of a volcano and about to fall in, but the numbers don't indicate that's happening," DataQuick analyst John Karevoll said." Los Angeles Times.

Mark Zandi at Economy.Com continues to believe, however, that the Southern California "housing correction" is in full swing and will last through next year.

So far, it would appear the correction is in the number of properties sold, as opposed to price, at least concerning Los Angeles County.

Local Credit is Very Global

What constitutes news and relevant information about real estate? About you as a real estate consumer? Well, a lot of things, not just pictures of residential property. Someone was recently upset because of an article about vehicle license renewal and what may happen if you’re stopped and maybe you just haven’t paid your overdue fees yet because you thought you had until the end of the due month on your license tag, and the fact that police have immediate access via computer to see if you’ve paid your annual fees on the due date. If it went unpaid (not that we must assume the worst, but here it is), notice of that goes to the Franchise Tax Board where it would ultimately appear as a tax lien connected to you. Then think about your credit report and what gets reported on it.

Think about your credit score being a reflection of financial events connected to you. Did you know that when you apply for insurance, or a bank account, your credit report is viewed? Then think about the fact that mortgage loan underwriters also take a look at that credit report, including recent events of all kinds just before they decide to give you a loan. The workings of our bureaucratic world are very important to know about when it comes to getting a loan. That way, when you get the loan, you can get the house. You may obtain your free annual credit report at http://www.annualcreditreport.com/.

Long Beach

Subprimes Are One Part of the Total Picture

This topic appears almost daily:

But what’s often missed in the current uproar is that while a substantial minority of subprime borrowers are struggling, almost ninety per cent are making their monthly payments and living in the houses they bought. New Yorker

While the West Coast is one of the areas seeing a rise in foreclosures, it also has a strong economy with strong employment.

"Foreclosures are increasing inventories in certain local markets. The projected flood of foreclosures are problematic and will add to the already loose housing supply in some local markets, but these local markets are exhibiting healthy economic activity, enabling them to be able to absorb increases in foreclosures," [National Association of Realtors Economist] Lereah said.

"From a broader perspective, today's subprime problems are occurring against a backdrop of cyclically low mortgage rates and a growing, healthy economy. Jobs and liquidity are plentiful in the marketplace, suggesting that the subprime problems may be a manageable problem within our $10 trillion-plus economy," said Lereah in a commentary distributed to NAR members recently.

Long Beach

Second Largest in Population

Just a quick note: The West and the South are the two fastest growing areas, and the only region with more people than Los Angeles County is New York, according to the Census Bureau. Supply vs. demand seems to dictate a constant need for housing in these highly populated areas well into the future, especially in California, since Riverside area is the fifth-largest growing area in the U.S. in population.


Long Beach

California and Subprime Loans

If the only thing you've done is turn on the television, you've heard over and over about "subprime" loans. Many people are unfamiliar with a lot of loan terms, and that includes those working in the real estate industry, but just know that because you're shopping for a loan now doesn't mean you're automatically going to get a "subprime" loan, because there are many loan choices. The individuals who've experienced trouble, so often the subject of the news media, are those whose credit scores were lower, so they were offered loans not at the prime market interest rates, but at higher rates with other conditions which led to them not being able to afford their payment when it reached the "fully indexed" level, meaning loan plus margin (the lender's set profit zone). These loans contained terms and condition not understood by the buyers, who for instance thought a 2-month or a 12-month 1% start rate was the actual interest rate, and did not understand what the annual increases would be on their loan, or what that would mean to their payment.

Before you read further, if you're a buyer currently searching for a loan and you have good credit with a strong mid-score over 680 (you knew there are 3 FICO scores, right?), you are not this kind of borrower.

Thus, the following excerpt from California's Department of Real Estate Bulletin, Spring 2007 where a borrower has a 1% start rate, payments increase annually while the deferred interest is added to the loan principal, and after 5 years go to the full payment level, while the loan principal has increased:

We have analyzed the impact on a buyer who takes a $300,000 payment option ARM and makes the minimum payments of $965.00 per month. The analysis is based on an actual adjustable rate note from a national lender. The note provides for first year payments based on a 1% interest rate, annual payment increases of no more than 7 ½% of the previous payment for 5 years after which full payments must be made to amortize the loan over the remaining term. Interest is adjustable monthly beginning after the first month based on the Twelve-Month Average of monthly yields on actively traded United States Treasury Securities adjusted to a constant maturity of one year as published by the Federal Reserve Statistical Release entitled “Selected Interest Rates (h-15)," otherwise known as the MTA. The margin is 3.10. Maximum deferred interest (negative amortization) is 115% of the original principal balance. There is no cap on the monthly rate increases and the life cap is 9.95%. As of the date this article was written, the index value for the Monthly Treasury Average was 4.88 making the fully indexed interest rate 8.0% after rounding. Let’s assume that there are no increases in the index for the first 5 years (a very conservative and unrealistic assumption). The loan term is 360 months.

After year one the balance has increased, because of negative amortization, from the original $300,000 to $312,814; after year 2, $325,787; and after year 3, $338,861. After the 43rd month, the deferred interest maximum is met ($345,328). Since there have been payment increases of 7 ½% each year, the monthly payment of $1,199.00 after year 3, would increase to $2,604.00 per month (the fully amortizing payment over the remaining 317 months) – an increase of $1,405.00 monthly barring any interest rate increases for the life of the loan. Considering that the one-year Treasury Security index value has increased almost 400% since January 2004, even though interest rate increases have slowed recently, the likelihood that this loan would achieve its maximum interest rate of 9.95% is very good. If that were the case after 43 months, the monthly payments would have ballooned to $3,063, a 317% increase from the original payment of $965.00.00 per month. Unless the buyers have planned for the payment increases by either expected increases in income, setting aside all or part of the monthly payment differentials, or some other financial plan to meet the increased debt service, the financial impact could be severe.

Some lenders are now doing the logical thing by making the buyer qualify not just at the initial rate, but the full payment level to avoid this situation, and the Department of Real Estate in the same article now states the real estate agent is to review loan document terms and conditions with the buyer.
NOTE: In a revised statement released on April 12, 2007, the DRE clarified that it "is the fiduciary duty of each licensee who represents the borrower in obtaining a loan to completely explain the terms and discuss the relative merits and risks of these loan products well before the point of signing loan documents." Buyers really must understand the basic terms they are agreeing to.

Long Beach

February Sales Update

Still the same trend: Sales volume decreases but sales price increases--compared to February 2006. According to the California Association of Realtors:

"The median price of an existing, single-family detached home in California during February 2007 was $564,700, a 5.7 percent increase over the revised $534,400 median for February 2006, C.A.R. reported. The February 2007 median price increased 1 percent compared with January’s revised $559,300 median price."

It appears that sellers are hanging in there with their asking prices and so are the qualified, motivated buyers. Los Angeles County was third in median price increase (5% over January 2007), with Santa Clara and Palm Springs/Desert areas being the 2nd and 1st, respectively.

Internet Home Searches

Trulia.com's March 2007 report about consumer online search behavior can sometimes be more about curiosity than serious looking:

According to Trulia's search data, consumers continue to search online for both "dream" and "deal" homes. Of the top 10 most viewed homes on Trulia.com, the most popular was a three-bedroom home in Rockingham, North Carolina listed at $18,590. Also on the list was a 15,000-square-foot Beverly Hills mansion listed at $24,950,000 - more than 1,300 times the price of the Rockingham home.

However, sellers should take note that industry data does substantiate that about 70% of homebuyers do start their search online, compared to about 10% just a few years ago. So that means the better presentation given on the the web whether through the online real estate multiple listing service or other listing services, the more you might find an actual buyer for your property. Not only does this reach a wider audience than print advertising, it also affords the prospective buyer a look around the property through multiple photos, but also the opportunity for instant mobility by e-mailing the listing to virtually anywhere.

Buying a Home at Auction

With more talk about foreclosures, there’s more awareness of buying a property at auction. But it’s important to do your research first if you think you want to buy a property this way. You need to get information about the property, i.e., amenities and square footage, how much is owed against it, and what is the expected opening bid, either required or suggested.

Have your financing already in place, and be prepared for the required deposit for an accepted bid. Your financing must be in place within a specified period of time.

Price at an auction is based on the loan amount owed plus fees and expenses that the foreclosure process has incurred. It may be less than market value, but realize that once the lender owns the property, it may sell with the help of a real estate broker or through auction.

You usually have to have the money in hand and your loan ready to fund. Each auction has different time requirements.

Most of the time, you don’t have the option of getting inspections and may not see what you’ve bought until you’ve bought it. Most homes are sold in “as is” condition without any warranties of any kind. There are no disclosures or guarantees. There are some auctions where you are allowed an advance preview which may afford an inspection.

Consider all your costs, including the auctioneer’s fee and taxes owed against the property. And during this time, all your research could be wasted (is any knowledge really wasted though?) as the borrower may be able to cure the loan at the last minute!

Last but not least, a property sold at auction may not have clear title, depending on how they are sold. There could be various liens and encumbrances which could require a lot of work to clear up.

Be prepared, if necessary, to walk away. If the deal is not right for you, it’s not a deal.

Information courtesy of eHow.com.

Long Beach

Foreclosure Auction

Median Home Price in Long Beach

Dataquick's city by city chart tells us the January, 2007 median. For Long Beach it's the combination of condos and single family homes (remember, condos usually sell less than houses overall and may sell at greater numbers) which in January sold 8.41% higher than January 2006 at $490,000. Then scroll further down the chart
and find Long Beach zip code 90810--that section next to Wilmington--included under Southwest Los Angeles to see the incredible rise in price there since 2006--over 15% to the current median price of $462,000.

It's important to understand that prices vary widely by area--to check areas within Long Beach by zip code, go here. Some examples:

Naples, Belmont Shore, Bluff Park, Belmont Heights = 90803.
Belmont Heights, Alamitos Heights = 90814
California Heights area = 90806
Wrigley = 90806
Westside = 90810
Downtown, Alamitos Beach, West of Belmont Heights = 90802
North Long Beach areas = 90807

Long Beach

Los Angeles Median Price Still Going Up

Sales are down 20% for six Southern California counties combined, but the median price for Los Angeles County was $528,000 in February (per Dataquick Information Systems), an increase of 7.8% from February 2006.

"Basically, the economy in L.A. County is much stronger than anyone imagines. You have that driving the bus," said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp.

The oft-predicted population growth factor was cited by Kyser as one feature of the current Los Angeles housing market, a factor which does and will likely continue the demand for housing now and and in the future, and is a driving force behind condo conversions and loft developments in commercial areas of local cities.

Sales volume fared a little better than other areas--in Los Angeles County, the sales volume was 11.1% below that of February 2006. See the Orange County Register's article on home prices hitting a new record.

Is It Worth It To Buy Now?

That's the big question for some people. With the higher prices in housing in recent years, some people feel they are saving money by renting. One way to look into this question is to figure your renting vs. buying costs over time. "Over time" is a key phrase here because how long you plan on staying in your new purchase will make a difference, as well the amount of money you put down. Another factor, among several, to consider is the rental market in your area and what it will do in the future: will rents appreciate, and by how much? To check current market rents, check classified ads in your local paper. Another way is going to the "Rentometer" link on the right column. Knowing your tax margin and current interest rates on any investments or savings accounts are other features. The longer you plan on staying in a property, i.e., 5 or 10 years, the more likely you are going to save money by buying. So try this rent vs. buy calculator now, and come back to the link on the right later as you try out different scenarios.

Long Beach, Renting

Basics of Your Loan

These days with so much in the news about subprime loans gone bad, it's also important to know that statistically, these represent a small percentage nationally.

"The truth is that 99% of all loans in the U.S. are not in
foreclosure. The remaining 1% that were foreclosed upon had the following breakdown:
* 80% were classified by federal lenders as Professional Thieves and were turned over to the FBI.
* 20% were classified by lenders as Fraud for Property that resulted in unethical lending practices.
* Ca. Defaults: Historical 32,762 - Low: 12,145- 3Q’04 High: 59,987 – 1Q’96 Current: 37,273
* For all of ‘06, foreclosures accounted for only 1.81% of all Orange County sales, with lenders reselling those homes at an average discount of only 3.8%!" Gary Watts, p. 4 of Real Estate Outlook 2007.

To avoid future dissatisfaction, find out now what to expect to see at your closing when you're faced with a stack of paper to sign. You want to know about three basic parts of your loan papers: The note, the deed of trust (or trust deed), and your HUD-1 statement.

The Note secured by a deed of trust includes the interest rate, payment terms and may include pre-payment penalty terms and other provisions. Make sure these are what you were told you were getting.

The trust deed will show the names of the trustor (borrower), trustee (usually the title company which holds title on behalf of beneficiary), and beneficiary (legal holder of the Note), and includes how the buyer will be taking title, and a legal description of the property and prepayment terms. You need to carefully check all of these before signing for any errors. Bring the legal description from your preliminary title report given you in escrow to refer to. (Even title companies can make mistakes: One time I was representing a buyer in escrow on a property and saw that the seller's name on the tax records had been replaced by the buyer's of the neighboring property because of an inaccuracy in recorded documents.)

The government HUD-1 statement is your final accounting of costs and disbursements for your property transaction. Save this form, as well as the rest of your transaction records, in your files. This document is included with your escrow closing package.

If you want assistance at the time of closing, ask your Realtor or loan officer to be there with you during your appointment, or ask them to be available by telephone in case you have questions when you sit down with the escrow officer.

And, last but not least, while I as a Realtor work with loan professionals I trust and may make a recommendation to you, you the buyer should search out your loan options with other professionals to satisfy yourself. This is also not the time in your life to assume your friend or relative who has been in the business 6 months is going to give you the assistance you need. Loans require extensive knowledge. I have been asked questions by buyers in escrow, who should have been asking these questions of their own Realtor, about lender services they are now unhappy with after their buyer contingencies have been removed and they may risk losing their deposit. Ask how long that loan officer has been in the business on a fulltime basis, if they can be reached when they are out of town, and who can you contact in their office if they are not available immediately, i.e., their loan processor. These questions are not a guaranty, but the answers may give some hints at the service and competence you will be receiving. There is much information on the internet, a lot of it negative, fear-driven, inaccurate or inapplicable to you, but there is no reason why you the buyer shouldn't be attempting to learn about your upcoming loan and home purchase as much as you can.

Home Loan, Mortgage

Transferring Your Property Taxes, California Prop. 90

There seem to be many inquiries about property taxes in California, so I hope you find this informative.

California voters approved Proposition 13 in the 1970's. Ordinarily, when the ownership of California real property changes, the property is reassessed at its current fair market value and the new owner pays property tax based on the reassessed value. However, the law provides certain exemptions from reassessment and, in certain instances, allows a taxpayer to transfer the base-year value of the property to a subsequent property without being reassessed. As a result of Proposition 13, a taxpayer's base-year value could be much lower than if based on the fair market value of the property. (Note: California tax code sections are Revenue and Taxation Code Sections 63.1 (dealing with transfers between parents and children, as well as grandparents and grandchildren), 62 (dealing with transfers into revocable trusts), 63 (dealing with interspousal transfers), 69.5 (dealing with transfers by persons over 55 years of age or severely and permanently disabled persons).)

Property which has had major renovations is normally subject to property tax reassessment. However, California law exempts certain property improvements from reassessment. Revenue and Taxation Code Sections 74.3 and 74.6 (dealing with improvements for disabled access), and 74.5 (dealing with seismic retrofitting improvements). Consult your tax advisor for advice.

Proposition 90.

Ordinarily under Proposition 13, the value of a home for property tax purposes is re-assessed to market level whenever a change in ownership takes place, which usually results in higher property taxes for the homebuyer.

In November 1988, the state's voters approved Proposition 90, which is designed to induce greater turnover of homes owned by senior citizens. The measure provides anyone over the age of 55 with relief from Proposition 13 by allowing them to move from one county to another without undergoing a change in their basic property taxes. (Note: there are currently a minority of counties that allow this transfer, Los Angeles and Orange Counties being two of them.)

Proposition 90 is a "local-option" law; each county has the option of participating. If a county has adopted a Proposition 90 ordinance, it accepts transfers of property tax base assessments from other California counties. If the county that the homeowner is moving from does not have a Proposition 90 ordinance, this does not affect the eligibility of the homeowner. Homeowners seeking to transfer their property tax base assessment must verify that the county to which they are moving has a Proposition 90 ordinance. Go to this list of California Counties to find information from your county tax assessor.

Proposition 60

Proposition 60 is a similar law passed by the state's voters two years prior to Proposition 90. It allows seniors to keep their property tax base assessment when they move within the same county. Proposition 60 does not require passage by a local municipality. It is state law.

Courtesy of Pacific West Association of Realtors

Baby Boomers, CA

Automated Property Searches

The Southern California MLS system -- Tempo -- has just completed a merger with the MLS system covering the San Fernando Valley, making the Southern California MLS one of the largest multiple listing services in the nation. That means an easier search for you when it comes to finding properties in Los Angeles and Orange Counties, and beyond, including Riverside and San Bernardino.

You may either go to the property search function on my website at www.juliahuntsman.com, or have automated property updates sent to your e-mail tailored to your specific search criteria, i.e., square footage, bedrooms, baths, zip code, city, Thomas Guide number, year built, and other factors. This includes condos and townhomes, houses, units, and commercial property. If you do your own search through my website, you will be receiving information that is current within a few hours as it is updated throughout the day. Do you want to know more? Just call me or e-mail me so I can help you as soon as possible.
Property Search,

Tax Time Concerns - Capital Gains

If you are not already aware, there are some exemptions available to your capital gains period if you come up against unforeseeable circumstances that require you to move. The Federal Tax Code provides ways a property owner can dispose of, exchange or sell an appreciated property and receive tax benefits. Some alternatives are described below.

IRC Section 121 enables a homeowner to exclude capital gain taxes (up to $250,000 if filing as a single, and $500,000 if married and filing jointly) if living in your principal residence as a primary residence for two of the last five years. Partial exemption is also available in certain unforeseen circumstances such as a move of more than 50 miles in employment, health or medical reasons, divorce or death. This can even include having multiple births which require a larger home! So if you were thinking of selling, and you may have one of these situations, contact your tax attorney or accountant to review your capital gains issues. If your home has appreciated little in the time that you have had it, your tax consequences may be very small, and your ultimate benefit may be very big by moving now. If you own units and live in one of them, you are still entitled to any applicalbe exemptions on your owner occupied portion.

Revenue Procedure 2004-51 also allows a property owner to convert a primary residence to a rental property, and later take advantage of both capital gain tax exclusion under §121 and tax deferral under §1031 by exchanging into a replacement property held for investment or for use in trade or business.


Long Beach, taxes

courtesy of Apiex.com

Tracking Recent Home Prices in Long Beach

So is it really this easy to see where home prices are going? This nice graph is courtesy of Altos Research, if you look at their page they have other graphs, such as time on market and amount of inventory, to look at too. The graph is showing you their sales price about single family home sales in Long Beach since September, 2006. They are not including condos.

If you look at Dataquick's January sales zip code chart, you can see some actual break downs. You might see prices have gone up or down in your area from one year ago.

If you're really serious about more input on decisions to buy or sell, try reading real estate broker and economist Gary Watts' 8 pages or so of A Little Bit of Heaven in 2007. Trying thinking about the long term view if you're in the market to purchase a home. So what if the price went down 5% from last year or it went up 5%. If you're going to be in your house for at least several years, the rise and fall of your tax deductions, interest rates and other future market conditions would probably make it all a wash. Your house is not a cash flow cow, it's a place of comfort and security. This report is intended for Realtors and was presented last Friday to our Board of Realtors, but I'm sharing it with you because it has a lot of good stuff in it! Just read it and think.


Long Beach, CA

First Time Homebuyers in Los Angeles and Orange Counties

There is a NEW First Time Buyer Program Available, through funds raised by Realtors and their Pacific West Association of Realtors who have contributed over $300,000 to this program--the “Opening Doors” program applications are available as of Monday, 2/25/2007. If you, or a member of your family or one of your friends, is a first time buyer, they may be able to take advantage of a new program that will give $5,000 up to $15,000 towards down payment costs.

Yes, there are guidelines and here are some basic guidelines:

Current upper sales price limits are $568,601 (non-targeted) for Orange County and $564,264 (non-targeted) for Los Angeles. Targeted areas have higher sales prices (geographic areas and income qualifications defined by California Housing Finance Agency).

Property areas must be within Anaheim, Anaheim Hills, Brea, Buena Park, Cypress, Fullerton, Garden Grove, La Habra, La Habra Heights, La Mirada, La Palma, Lakewood, Long Beach, Los Alamitos, Norwalk, Orange, Pico Rivera, Placentia, Rossmoor, Santa Ana, Seal Beach, Signal Hill, Stanton, Tustin, Villa Park, Westminster, Whittier, and Yorba Linda and nearby county areas.

Income limits generally are: Current limits for Orange County are $97,320 (1-2 persons) and $113,540 (3+ persons), and for Los Angeles County are $83,160 (1-2 persons) and $97,020 (3+ persons).

Minimum FICO score of 620 for all applicants.

This program is designed to help people who want to buy. For more detailed information, a lender referral, active listings, or an application form, please contact me immediately!
Long Beach, Homebuyer

Rear View Mirror is Always Clearer Than the Windshield

Among the ten biggest homebuying mistakes: Waiting for a better market and interest rates.

You only have the market you're living in right now, and that market is also tied to whatever the economy around you is doing. Think about how long you plan to live in that property, and find the best loan for it. In the past, 30-year mortgages were just about the only choice. But the national average shows that most people move again in about 7 years, whether it's due to job choices or a growing family. Getting a good interest rate is tied to your debt and to your FICO score, and as long as you have lower debt and a good credit score, you will probably be able to pick out a 5 or 7-year fixed rate which could save you money on your payment. Even if you have to pick a more costly loan to buy a property in the naer term, you always have the choice of refinancing when the market becomes more advantageous. Remember, real estate happens in cycles, and you can't predict the future. The opportunities you see before you right now may actually work out the best for you in the long run. That is why waiting for a better market is only waiting. People typically look backward later on and see what it was they missed, and then find it all too easy to live in the past. Take a careful look now and do the work that is necessary to make the best choice possible.

Southern California, Homebuying

Happy President's Day

I think George Washington hasn't gotten a fair shake in the more commonly known portraits of him. One of his problems was supposedly the various sets of false teeth he had to use, and of course the oil portrait styles of the time. This life mask is a much more likely representation of his normal facial appearance.

He inherited his brother's estate at Mount Vernon in 1752 at the age of 20. Today's version of that estate is not what George Washington would have been managing in the 1700's--a very different world which grew from the original 500 acres to 8,000 acres divided into 5 farms, designed to be a self-contained, self-producing community with a workforce of slaves who later were emancipated in his will. While other people did the heavy lifting, George did all and more that management of his estate required:

He worked constantly to improve and expand the mansion house and its surrounding plantation. He established himself as an innovative farmer, who switched from tobacco to wheat as his main cash crop in the 1760's. In an effort to improve his farming operation, he diligently experimented with new crops, fertilizers, crop rotation, tools, and livestock breeding. He also expanded the work of the plantation to include flour milling and commercial fishing in an effort to make Mount Vernon a more profitable estate. By the time of his death in 1799, he had expanded the plantation from 2,000 to 8,000 acres consisting of five farms, with more than 3,000 acres under cultivation. Biography

Washington, and others of his time, was not given the type of academic education we think of as necessary today, but his education came more in the form of private tutoring. People of his time were trained in social behavior as well, including standards of behavior which George copied when he was very young, The Rules of Civility, standards which are just as applicable to people today and which should be required reading in my opinion.



George Washington, Presidents

Lenders Tightening Up--Take Care of Your Credit Ranking

It just can't be emphasized enough to keep track of your FICO score, because the name of the game is the higher your score, the more choices you will have and the better rate at a lower cost you will get. As more subprime lenders change their lending guidelines and cut back, as today's announcement concerning Washington Mutual's subprime division Long Beach Mortgage indicates, buyers who want to buy need to learn about what goes into the FICO score. For instance, length of credit history accounts for 15% of your score, and your payment history accounts for 35% of your score, as the graph shows. Keeping your balance owing on a credit card, for instance, to less than 50% of your total credit allowed is also a scoring factor.

No point in going out and buying that new car just when you want to shop for a mortgage loan, because you could be loading yourself up with too much debt. The mortgage industry started using this scoring system in the 1990's, developed by the Fair Isaac Company, and they have specific score breakdowns showing the likelihood of a 90-day late in the near future according to your credit score. If your score is 700 or over, it's 288 to 1; if your score is 600 the likelihood is 4.5 to 1. There are more features, plus the fact that your score comes from 3 agencies and each may be a little different, so lenders develop loan qualifying criteria based on your high and mid-scores. If you want more information, please contact me.

Long Beach, subprime

Live Close to Work

Under construction now from a major homebuilder in downtown Los Angeles. Live close to where you work in housing that starts from the mid $300,000's. Contact me for more information, on "Property Search" or call phone as given.
Los Angeles, condos

California Property Tax Rates

I just found that someone was doing a search term for rates in Southern California. Actually, California has the same basic tax rate throughout the state. What varies are local taxes due to bonded indebtedness and other county or district taxes.

The basic property tax rate is estimated by multiplying the sales price by 1.25%. This is a the base rate of a tiered formula which does increase incrementally with time. When buyers are in escrow in California, the seller is required to provide a tax report to the buyer before the close so that the buyer can see all taxes due, whether or not certain ones are levied that year. That way, there are no unexpected surprises and the buyer is supposed to have full information. These reports are ordered through an outside source company paid to search all public records for the appropriate information in order to provide full disclosure on all taxes to the buyer.
See more California tax benefit information.

property taxes, CA

California's Median Selling Price in December

The median price of an existing, single-family detached home in California during December 2006 was $567,690, a 3.7 percent increase over the revised $547,400 median for December 2005, C.A.R. reported. The December 2006 median price increased 2.2 percent compared with November’s revised $555,280 median price.

While this is a statewide figure published as of January 25th, and the Los Angeles area's median house price of $584,600 is somewhat less when you look at Dataquick's figures (which combine house and condo prices), nevertheless, California home prices continue to reflect an economic fact despite a much lower sales volume than the last several years.

Long Beach, Bubble

What Happens If You Are In Foreclosure?

Recently, California has experienced an increase in property owners who cannot seem to make payments. If you are one of those people who has received a Notice of Default from your lender, please read this.

You still have time to find solutions and avoid losing your property. Maybe your property isn't a mansion, but to you, it is. You should consult with your attorney for complete information on the foreclosure process, and your accountant for tax advice.

A non-judicial foreclosure under California Civil Code section 2924 allows lenders to foreclose upon real property without going to court. It takes approximately four months from start to finish. Once the sale auction is completed, it is final, but an IRS tax lien can cause a delay in the finality of the sale. The borrower must then vacate.

1. Your trust deed functions as the lender's security device for its loan. Lenders may hire a new trustee to replace the trustee named in the trust deed and then instruct the new trustee to issue a Notice of Default, and "NOD", in which you, the borrower, are warned to act or face the consequences. The NOD is recorded at the County recorder's office, and sends copies to the borrower and to any party who requested a Notice of Default form, to holders of junior trust deeds, to the borrower's successor in interest, and anyone else legally entitled, no later than one month following the recordation of the NOD.

2. You have the right to reinstate the loan by tendering to the lender or trustee your delinquent loan payments, plus the trustee's fees and costs. Upon receipt of that payment, the trustee is obligated to rescind the NOD, and the loan is reinstated to normal status, as long as it is reinstated until five business days before the scheduled foreclosure sale. Otherwise, the lender is not required to stop the sale, and the lender may demand the borrower pay-in-full the total outstanding principal balance and accrued interest on the loan, plus trustee's fees, right up until the moment before the sale is completed.

3. If three months pass following recordation and the borrower does not reinstate the loan, the trustee is instructed by the lender to set a time, date and place for the sale, usually three to four weeks from that time, hence, the total time of about four months.

4. The borrower will receive a Notice of Trustee's Sale, along with other entitled parties. The NOS must be mailed, posted in a public place, published in a newspaper of general circulation in your property city--all 20 days before the sale date-- and recorded at the County recorder at least 14 days prior to the sale date.

5. At the appointed time, the trustee conducts the sale at public auction.

You may have time to refinance (there are hard money lenders who will loan even though an NOD has been recorded) and even if at a higher rate, that is better than losing your home. When your situation has improved, you may be able to obtain a better loan. You may also contact your lender for arranging a "short sale". Lenders don't really want to take back properties, and are often willing to make an arrangement with the borrower who might otherwise be able to sell the property rather than going into foreclosure.

Above all, you should not ignore your situation, as difficult as it is at the time.

Please know that this is one of my most frequently read posts. Many people are facing this issue. If that could be you, or it is you, please know that (1) you may be able to refinance your way out of your situation, (2) you may be able to negotiate a short sale with your bank. If you need immediate loan qualification, or are considering negotiating a short sale, PLEASE CALL ME.
If you would like a market analysis of your property to try to sell it, please call me at 562-896-2609 or e-mail me ocean@surfside.net immediately.


Long Beach, CA, Foreclosure

Something to Think About: Future Homeownership

Comments by the CEO of Freddie Mac, Richard Syron, on February 8, 2007:

The driving force in housing is going to shift dramatically in coming decades, from the Baby Boom generation to minorities and immigrants. Demographic projections indicate about 15 million new households in the United States in the next decade, and some 10 million of them will be minorities. Recent immigrants will likely account for 5 million of these new households, and many will be unfamiliar with U.S. banking and mortgage finance.

America will need 20 million additional homes, about 2 million a year. Today, total homeownership in the U.S. is 69 percent, the highest it's ever been (sometimes we forget to think about the positive while we're totally engrossed in solving tomorrow's issues). "Today, 76 percent of white non-Hispanic families own their homes, but only half of minority families are homeowners."

About 200,000 loans entered foreclosure proceedings during the third quarter of 2006. Based on our experience, about 60,000 of these families will ultimately lose their homes. If that rate continues, nearly a quarter-million families will lose their homes to foreclosure during the coming year. This is an issue we are quite concerned about.

Our gains in homeownership should be protected, but not at the cost of giving risky loans to those who can't fulfill them. Every buyer needs to understand the terms of the loan they are being given.

Long Beach, Demographics

Pros and Cons to Calculating Your Home's Value Online

This article is straight from The Wall Street Journal's real estate section. Right off, it makes the point the property owners have come to see their home like it's a stock, with an equity value to use as a pool for more acquisitions. Read on to see how the author tested out several online systems for arriving at a value, to find out that a very broad range was quoted instead of one specific price. A single price, however, was quoted through the Zillow.com and Realestateabc.com sites. (Through my own experience, I can tell you that Zillow may quote a price not agreed with by me in my own market analysis, whether too hight or too low.) An offsite appraiser was finally contacted, and the appraiser's opinion lowered drastically after he visited the home to a range that approximated that of Zillow.com's and Realestateabc.com's estimate. Be aware though, that even though sites that use property tax sales as the basis for their database, and which would be the same one's a Realtor would use, do not include other important condition information--the sale amount alone does not tell all, just as the appraiser's estimate changed after he saw the house.
Oneline estimates are great tools, but should be almost always considered as a preliminary ballpark figure at best, as sometimes the value of your home could be very greatly overestimated or underestimated.

Good News for Loan Financing--Mortgage Insurance is Tax Deductible in 2007

Buyers have always been faced with certain loan condition when making less than a 20 percent down payment on a home. To avoid paying that extra non-tax deductible mortgage insurance premium -- or a higher interest rate factored into some 10 percent down loan programs -- buyers frequently chose "piggyback" seconds whose interest was tax deductible. But, Congress recently passed legislation that provides for an itemized deduction on federal tax returns for the cost of private mortgage insurance paid by eligible borrowers. Previously, borrowers could not deduct the cost of their mortgage insurance payments. Now, a new federal law allows qualified borrowers with adjusted gross incomes up to $100,000 to deduct 100% of their 2007 MI premiums on their federal tax returns. The legislation is effective for mortgage insurance certificates issued in 2007.

Individual savings will vary depending on the size of the loan and a borrower’s adjusted gross income and tax bracket. According to an analysis by Bankrate, a leading source of consumer financial information, a homeowner with a $180,000 mortgage would save about $351 in taxes a year.

This new deductability allows buyers to now reconsider whether to choose lender seconds--where the interest has always been tax deductible but higher interest rates now apply--or go with deductible mortage insurance which may have extremely competitive ratios compared to the current interest rates on many piggyback loans.

The legislation specifies that the tax deduction applies to mortgage insurance contracts issued between January 1 and December 31, 2007, so it would include purchases and refinances within that year. However, Congress has the power to extend the tax deduction to future years, or even to make it permanent. This currently does not apply to investor purchases.

Currently, this MI tax-deductibility legislation only applies to eligible borrowers with adjusted gross incomes of $109,000 or less who purchase or refinance a home between January 1 and December 31, 2007 and pay mortgage insurance premiums. Mortgage insurance premiums allocable to 2007 will be fully deductible for eligible taxpayers earning up to $100,000. The amount of the deduction incrementally phases out for those who have adjusted gross incomes between $100,000 and $109,000 annually. For more specific information, please visit www.pmi-us.com/tax.

Income Tax, tax deductions, Mortgage Insurance

If More Information About Teeth Became Publicly Available, Would You Fire Your Dentist?

Something that a lot of internet users have a misconception about is that property listings that are available for public viewing on the internet are not in the public record, as some people actually have told me they believe, i.e., they won't be found at the court house as a recorded property deed is. Furthermore, they don't seem to realize that sellers have a choice as to whether or not to put their listing into internet sites or just keep it within the local MLS of their agent, as advantageous as wider internet exposure may be for them.

The proliferance of sites that supply listings, i.e., Trulia and Zillow, just to mention two out of what are probably hundreds if not thousands, are not necessarily a complete databsse of REALTOR-listed properties through an MLS system. Again, they can be a viable source of information for everyone, but they depend on property tax records, which ARE public records and therefore available to anyone, and manual entry of listings by owners or agents. MLS's cooperate with various sites to allow their listings to be shown on other internet sites, and brokers may have an opt-out capacity. Why? Because a listing agreement belongs to the listing broker and is a contract between a seller and his/her listing broker/agent, not a public document to be found in the public record. That is what is behind every REALTOR's representation of a property. With the spectacular rise in real estate values and internet use came many others who wished to be a part of the REALTORs' business of representing their clients like never before. This leads into the current debate going on about MLS's and control of them, as housing values and sales are currently a huge factor, if not a driving force, of the economy.

In the United States, but not necessarily in all other countries, we no longer live in a world where showing a property means driving over to a listing broker's office to get their list of properties, and then driving on to another broker's office to get theirs. That's why the multiple listing services came about as far back as the 1930's--before an internet was even conceived of by the average person. The merging of MLS's, even if there is one national MLS, will still not eliminate the need for professional assistance in viewing, buying and selling homes. Or I may as well start drilling my own teeth and fire my dentist.

Long Beach, MLS

It used to be we had the book, and they had to come to us for information.”

That quote from Rob Levy, a real estate broker in Portland, Oregon refers to the MLS book, an artifact from ancient past history as long ago as the late '90's, a piece of history that by now is probably little known to younger prospective buyers entering the market for the first time who are used to quick access to information. That was back when a trusted Realtor was considered the major source of information about homebuying and selling. Fast forward now to a time when real estate information is everywhere in print and on the internet, it's so much everywhere from so many sources, that choosing the right information from the right source takes labor, time and a lot of self-education for the buyer. It's becoming important to know where to look.

Like the buyers in the article, "Buyers Who Go It Alone" by Buck Wargo, REALTOR® Magazine Online, they may think it's easy because maybe their first transaction was smooth. But different real estate cyles have a tendency to change situations, plus new laws in real estate impose additional requirements and disclosures, which may leave both buyers and sellers in quandry in the middle of a transaction if they decided to leave a qualified REALTOR® out of the mix.

Internet tools, such as MLS searches on REALTOR® websites and other online media article, are great resources not available in the past, and a non-pressured way of looking. But I'm also finding in this market that there are those who have done very little prior research and would rather come into the open house and talk personally with a Realtor, and I'm wondering if there isn't so much universal information to be sifted through, that despite media publications to the contrary, most prospective buyers and sellers want "local, up close and live" talk from a professional whose business it is to provide specialized expertise and knowledge accumulated from experience and competence.

Long Beach, CA, open house, homebuyer

Future Reminders

I just saw this on another site, it's a great idea for reminders and planning. Send yourself an e-mail you write today and get in the future to find out if you really did do the things you said you would, or planned on, or wanted to do--your annual business goals, the trip you wanted to take, a relationship, selling your home--anything at all. Try it.

Long Beach, CA

Talking to Your Realtor

With so much focus right now on housing affordability and on the financial capacity of the buyer to buy, you would think the only thing holding someone back is whether they have money, or access to it. But in fact there are other reasons why a buyer may have to wait.

Most recently, I met a man and woman who seemed very ready to buy together and told me they were pre-approved for a loan, and that they could get the letter of pre-approval I asked for. After getting them to a table where we could talk, and presumably write the offer on a house they seemed most interested in, it turned out there was more information not previously revealed. Buyers, first of all, please realize that when a Realtor asks certain questions, they’re not just prying. There’s a reason for finding out, for example, what your marital status is. Just know that California is one of the several community property states in this country, and if you’re still married—that means your divorce decree is not yet finally granted by the court—that new property you’re going into escrow with will also be owned by your current spouse.

See this Marital Status flyer from North American Title.

If you’re planning on buying with your new partner, that could complicate things. If your current spouse is not willing to quitclaim his/her interest in your new purchase, and you don’t want him/her on title with you, that could completely prevent the transaction from going forward, and might have certain consequences to you depending on the terms of the contract—losing your deposit (in this market often at least about $10,000-$12,000) could be one of them.

So please, disclose information concerning taking title to all parties at the outset of your working relationship. It will save everyone, including you, from transaction problems which might actually be negotiated in some way if known up front.


Long Beach, CA, community property, divorce

2236 San Vicente

Contact Julia at 562-896-2609 about this property and open house dates or to view this property. Current asking price is $687,500.
LA: Re/Max Real Estate Specialists

Long Beach, CA

Change in Formatting

As of today, blog entries will be categorized, and older ones will eventually be included, so lick on the links to see other entries.

Inventory Decline This Month

The inventory in November for the greater Los Angeles/Long Beach area climbed to over 40,000 units, houses and condos combined--that was up from 27,000 in April 2006. This month has settled back down to about 30,000 units on the market. Buyers have more time to decide, which is good, because buying a new home is pressure enough--but with so much on the market at one time in some areas, buyers have mistaken it for a recession, instead of a more normal market time for most properties. 2007 is predicted to be the 4th best year for real estate, according to NAR, not the 19th, which is what some have been fearing. Try finding your home through my local MLS website search, which is updated throughout the day: www.juliahuntsman.com.

Long Beach Local Zip Code Stats

Here are just a few stats for areas closer to shoreline - December 2006 median price:

90803, Belmont Heights, Bluff Park, Belmont Shore, Naples areas - 13 single family residences sold for median price of $1.135 million, a decrease of about 10% from Dec. 2005;
10 condos sold at $446k median price, an increase of 5.1% over last year.

90814, Bluff Heights, partial Belmont Heights -
13 single family residences for for median price of $700k an increase of 5.7% from previous year;
8 condos sold at $431k mediain price, an increase 13.8% over last year.

90813, Downtown areas -
12 single family residences sold at median $440k, an increase of 12.8%;
7 condos sold at $345 median price, an increase of 3.0% from 2005.

For current market listings where it's easy to search by price and zip code, go to the Property Search at www.juliahuntsman.com.

What’s Causing Home Prices to Drop?

Basically, the answer in this article is that prices increased so much in California that buyers are still sitting on the sidelines, in spite of otherwise good economic indicators. In fact, 2006 was the third best year for sales according to the National Association of Realtors, and 2007 overall will still be strong. Mortgage rates are holding for now, and on the West Coast prices are stabilizing: Don't make the mistake of the buyer in Dallas who, in a market 15% under the national median, still wants to subtract $50,000 from his offer price. In other words, know your local market.

"Buyers who are still waiting on the sidelines must learn a basic economic fact of life: if fundamentals aren't supporting a market decline, then it's not going to decline for very long. If the nation and local communities are adding jobs and population, a market decline is destined to be short-lived.

"Price is a legitimate concern, but with growing inventories, buyers should be taking advantage of an abundant selection. In a seller’s market such a luxury doesn’t exist and slim pickings mean they must take whatever is available."
Blanche Evans, Realty Times.

2007 Median Prices May Remain Flat, But Mortgage Rates May Rise

The hoped-for huge drop in home prices many buyers have been waiting for and expecting is not likely to be the reality. While prices may go up in some areas at a very modest appreciation, or just stay the same, buyer's home payments may increase with the rise in mortgage rates. So why wait? Look for your next investment property, house or condo at www.juliahuntsman.com by clicking on the Property Search. You'll be glad you did as it's updated and current throughout the day directly from the local MLS.

The Mortgage Bankers Association expects the interest rate on a 30-year fixed-rate mortgage to jump from 6.2 percent to 6.5 percent by the end of the third quarter, as investors lose hope that the Federal Reserve will slash short-term rates any time soon.

The MBA Chief Economist

expects existing-home price appreciation to slow "significantly" over the next three years, and that median prices should remain relatively flat for new and existing homes. Price gains for both types of housing are expected to be limited to about 2 percent in 2008 and 2009.

Inman News, Jan. 17,2007

Appreciation Up, Sales Volume Down

Buyers and sellers really have the best of both worlds right now, but buyers are having a difficult time seeing that in the midst of bubble talk reports. Dataquick, in its usual way, combines condo stats with single family stats, but the story is there. Find MLS search at here.

Bubble's pop was akin to a slow leak-K. Harney

There will be much talk about foreclosures this year: Those adjustable rate mortgages are coming out of their initial lower start period, and much to the surprise of some borrowers, are now the source of some bumps in their homeownership road. If you're reading this and think you're one of those people, just e-mail, leave a comment, or call for financing information. In many cases, a worst case scenario can be headed off with a new loan made with full disclosures about how it works. You may be paying a little higher interest rate for a while, but you can usually fix that after you bring up your credit score so that you can get a more competitive loan. This process may save you and keep you in the home you want. Understanding financing is crucial in today's world which offers so many options--it's important to understand their terms before you sign on the dotted line. Read here about more commentary on national markets, including the 7% appreciation overall in the Long Beach/Los Angeles area in spite of decreased sales volume. Bubble's pop was akin to a slow leak - Los Angeles Times.
For more real estate information go to www.juliahuntsman.com.

Long Beach Economy: Tourism and Trade

"Although the Long Beach Area Chamber of Commerce is projecting a subdued California economy in terms of job growth due to federal policies, high energy prices and a weakening housing market, it does anticipate a stronger Southern California performance. “I’m optimistic about the Long Beach economy,” said Brandon Kline, vice president of public policy and government affairs for the chamber."We have strong performances in international trade, technology, aerospace and tourism. . . . Even though California may have subdued economic expansion next year, I think our local regional economy here in Southern California will thrive because of those things. So, despite that slowdown, our highly diverse business structure is going to enable us to perform at a high level.

"Indeed, the hospitality and tourism sector is poised to continue to do well in the coming year, although substantial growth will be very limited, according to Kyser. “Tourism will probably hold at a high level, and that’s because, literally, we’re running out of hotel capacity,” he explained.

"One “reliable growth engine” marked by Kyser is the international trade sector . . . “International trade is going to be an interesting sector to keep our eye on,” Magaddino agreed, pointing to the significant impact of the weakening dollar on exports. . . . What we’ve seen is continued decline in the dollar, and that makes our exports much more competitive on a global marketplace."
Now is the time to buy, whether you're investing or looking for a home for yourself. Go to
www.juliahuntsman.com and click on "Property Search", an easy way to get started viewing our MLS listings.

California: The Sixth Largest Economy in the World

So wouldn't you know the house prices would be higher here as well.

California Housing "Fast Facts" from California Association of Realtors:
Calif. median home price - November 06: $555,290
(Source: C.A.R.)

Calif. highest median home price by C.A.R. region November 06:
Santa Barbara So. Coast $1,083,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region November 06:
High Desert $332,340 (Source: C.A.R.)

Calif. First-time Buyer Affordability Index - Third Quarter 06:
24 percent (Source: C.A.R.)

Mortgage rates - week ending 12/28:
30-yr. fixed: 6.18%; Fees/points: 0.4%
15-yr. fixed: 5.93%; Fees/points: 0.4%
1-yr. adjustable: 5.47%; Fees/points: 0.6%
(Source: Freddie Mac)