9/15/2014

What Is The January 2015 Market Doing in Long Beach, Cerritos, Lakewood and Rossmoor?

Here is a brief summary of January 2015 sales, compared to January 2014:

Long Beach - Median sales price for a single family home: $481,000 (up 5.8%), housing inventory down 22%, with only 2.2 months supply of inventory on the market.

Cerritos - Median sales price for a single family home: $602,000 (up 3%), housing inventory down 9% with only 2.1 month supply of inventory on the market.

Lakewood - Median sales price for a single family home: $443,500 (up 3%), housing inventory down 44%, with 1.4 months supply of inventory on the market.

Rossmoor - Median sales price for a single family home: $807,500 (up from $800,000), housing inventory still at 2.6 months supply of inventory on the market.

By checking points along the graph, prior months' sales prices are seen. Long Beach and Cerritos are down, Lakewood and Rossmoor are up. This is a live graph, and is updated with each month's sales.

Would you like to know what buyers" home buying motivations are? Buyers who purchased brand new homes did so because of fewer electrical and plumbing problems. Sellers who take this and other items into account when preparing their home for sale are less likely to get a laundry list of repairs desired by buyers.
NAR's 2014 Profile of Buyers and Sellers

8/08/2014

California Home Equity is Up, But Distressed Owners Are Still Among Us

Distressed property owners have not disappeared totally.  A review of the Los Angeles County tax records today for the entire Long Beach area shows 257 residential properties in pre-foreclosure status.  Who's represented?  Property owners in all zip codes and while I didn't make an exact count, adjustable mortgages seemed to predominate.  This is unfortunate, because while many more owners are now benefiting from the upward trend in values, many are still affected by loss of job or short term jobs or lower paying jobs in the face of an upward increase in their mortgage, just to name a few reasons.

Owners who have attempted loan modifications may not have met all the hardship requirements, or they do not have enough income to refinance under today's more stringent-i.e., traditional-loan guidelines. And so, like the TV advertisements show us, they "freeze" up, unable to take action, and unable to come to the decision they might need to sell and relocate.  If you or someone you know falls into this category, short of finding a financial benefactor, the choices may be to sell, go into foreclosure, or continue to struggle if you possibly can.  One of the dividing lines for being eligible for loan modification or short sale assistance is whether or not your property value is still (much) lower than what you owe, OR you have experienced a qualified economic hardship.

Under a current California program, an owner may be eligible for up to $5,000 in transition assistance, loan principal reduction, unemployment mortgage assistance, and loan reinstatement assistance.  Also, Bank of America and other banks still offer their transition assistance programs for people in short sales. This program does not do loan modifications--for that you need to go directly to your servicer--but it does offer 4 other types of help.

For more information on this program, go to http://keepyourhomecalifornia.org, a program run by California Housing Finance Agency (CalHFA) with $2 billion in funds through the Hardest Hit Fund of the U.S.Treasury.  The site includes all information about eligibility, the participating servicers, and income requirements.  Over 43,000 California homeowners have been helped. 


8/05/2014

Prices Continue Up for June in Many Cities, But Sales Volume Way Down



Average single family home prices in June, 2014, and the increase or decrease compared directly to June of one year ago (prices may differ from overall annualized price), plus stats on closed sales and days on market (DOM).  Actual number and percentage of sales are down (see red column), a lot; properties are usually spending more time on the market before going into escrow (last column); and the average house price, on a citywide basis, is higher than one year ago.  The percentage increase in price, however, is lower compared to May's increases, in many areas. (P.S. See my new Metro Summary page for Long Beach region info for July).
     

Cerritos$739,333+10.8%Closed Sales-40%DOM +27.8%






Lakewood$463,096+7%Closed Sales-32%DOM +8%






Long Beach$555,496+17%Closed Sales-28.4%DOM +58%






Los Alamitos$726,667+9%Closed Sales-57%DOM +72%






Seal Beach$1,021,223+14%Closed Sales-20%DOM -33.3%






Signal Hill$655,000+7%Closed Sales-75%DOM +87%






Huntington Beach$920,396+19%Closed Sales-21%DOM +68%






Norwalk$340,943+9%Closed Sales-8%DOM +5%






Downey$444,903+8%Closed Sales-24%DOM +59%  






Garden Grove$503,922+15%       Closed Sales-58%DOM -9%











7/29/2014

Thinking of Taking Money Out of Your California 1031 Exchange? Do It The Right Way

A basic feature/requirements of 1031 exchanges is that the taxpayer doing the exchange cannot have access to their funds--that's why there's an accommodator, or "qualified intermediary" (QI).  In real estate, 1031 exchanges are allowed where the property owner has not lived in the property as a principal residence, but has owned it usually as some form of income or investment property. There are certain exceptions to this, but they will not be covered here.  Just know that the rules surrounding IRS 1031 exchanges are specific and detailed, and must be complied with to the letter.  A principal 1031 exchange benefit is in deferring capital gains taxes on the sale of property by shifting funds into a new purchase, also a non-owner occupied property.  For a property owner who bought in a low market, and is selling in a much higher market, the tax savings can be significant. Simply, in this type of transaction, the taxpayer is not allowed access to funds which are handled through the QI, unless there is an agreement that the taxpayer is taking money out of the first sale, known as "boot", which will not be used in the acquisition of the next property.

As previously covered in other posts, the State of California wants all of the money it's entitled to, so recently a tax audit of an exchange failed because the State said the taxpayer didn't follow the 1031 exchange agreement.  So that means the taxpayer is now probably paying a lot of taxes which otherwise would not have been the case.  The State didn't like the taxpayer giving the escrow officer, not the QI, instructions to exclude $150,000 from the purchase of the next property and send it over to the taxpayer.  The Franchise Tax Board said the taxpayer thus really had access to the funds, which he/she was not supposed to have, and so the exchange was violated.

Moral of this story:  If you're doing a 1031 exchange transaction and you want to take out money from it, make sure it's included in the actual written agreement with the QI, because the QI is who is responsible for handling all funds in the exchange, not the escrow officer. Make sure you are using an experienced and known professional accommodator, are following the advice of an experienced tax professional, and are working with an experienced REALTOR as well.  It could make a huge difference to your bottom line.  Read more at Asset Preservation.


7/15/2014

New Listing: Long Beach, 7027 E Keynote St., Carson Park, Large Single Family House!

7027 E Keynote, Long Beach CA
7027 E Keynote, Long Beach CA
Just Listed -

Here is a spacious 4 bedroom home in East Long Beach with 2 baths and a large family room at 7027 E Keynote St, Long Beach 90808.

With two bedrooms and one bath downstairs, this could be ideal for an extended family or one with older children staying at home.

Low maintenance rear area is great for a spa addition, and side yard could easily be fully enclosed for a pet area.

This home shows as 2402 sq.ft per the tax assessor, features forced air heating, wet bar and large brick fireplace in the family room, an inside storage area, and a remodeled kitchen enlarged from the original 1953 floor plan; it also includes cable TV and FiOS wiring. The inside laundry room includes the washer and dryer.

The quieter interior block location is off the busy streets, yet not too far from freeway access.  Two schools are just a few blocks away and within walking distance.  A great neighborhood for walking and bicycling.  See more at www.juliahuntsman.com "Featured Properties".  Lic #01188996

As of July 15, 2014, offer price is $575,000. Sold 10/30/2014

7/11/2014

Maternity Leave is NOT a Reason to Not Get Your Mortgage


Every day we are hearing that many buyers are having a tough time getting a mortgage, and there are real reasons lenders are not giving out loans to certain buyers. But one thing that's not supposed to be happening is discrimination:

Several banks, including Bank of America, PNC Mortgage, Cornerstone Mortgage, and at least one insurer, MGIC, have been found guilty have been penalized for delaying or denying applicants because of pregnancy and/or upcoming maternity leave. We thought such discrimination was behind us, but apparently not.

Lenders see a time of reduced income, and assuming this, have been denying mortgage approvals.  Apparently quite a few women have complained, because the insurer MGIC was guilty of denials for at least 70 women.  Mountain America Credit Union, based in Utah, was also found guilty, in addition to other mortgage insurers.

In spite of the numbers of working mothers in this country, some lenders still believe that a woman's commitment to the workplace diminishes after having a child.  According to MomsRising, a  national advocacy group, three quarters of all mothers are working women.

However, federal law assures an applicant: “Any denial or delay of a mortgage application, according to fair lending regulations, violates the federal Fair Housing Act, which prohibits any form of unequal treatment based on gender or familial status”. 

HUD and the Department of Justice have levied monetary penalties against the offenders, even though they say they are following underwriting guidelines and have done nothing wrong.

Ironically, lenders DO NOT accept the birth of a child as a reason for reduced income or any other financial impact when a distressed borrower applies for a short sale from a lender , so why is it being given as a reason for denial of loan approval?

See this article by Ken Harney: http://www.latimes.com/business/realestate/la-fi-harney-20140706-story.html 

7/01/2014

Long Beach Concerts in the Park for 2014

Long Beach Concerts in the Park for 2014 begins this week in various locations in the City. Please check the link below for complete information.


Week 1 - July 1 through July 4
LET FREEDOM RING



Week 2 - July 8 through July 11
BROADWAY SPECTACULARS

Week 3 - July 15 through July 18
DIXIELAND JAM AND RAGTIME REVIEW 

Week 4 - July 22 through July 25
VIVA LA FIESTA

Week 5 - July 29 through August 1
GERSHWIN!


http://www.longbeach.gov/park/recreation/lb_municipal_band.asp

6/30/2014

So Cal Cities Update - Long Beach Region

Happy 4th of July!
 




Average single family home prices in May, 2014, and increase/decrease from one year ago (prices may differ from overall annualized price):

Cerritos:                 $644,036, +9%
Lakewood:             $479,462, +10%
Long Beach:           $534,617, +4%
Los Alamitos:         $641,000, -16%
Seal Beach:             $989,577, +20%
Signal Hill:              $630,500, -10%
Huntington Beach:  $849,050, +2%
Norwalk:                 $362,598, +12%
Downey:                 $476,152, +19%
Garden Grove:        $495,475, 14%


Financing Options in Southern California

About 25% of buyers, especially first time buyers, are reporting in a recent survey by HSH.com that they are having trouble with accumulating funds for mortgage down payment.  Another 25% say the price of the housing market is slowing them down, keeping them from buying.
The actual breakdown as to the biggest hurdles to home ownership in this survey where the respondents were given these choices: here is how they responded:
  • Credit score: 12.8 percent
  • Home prices: 23.5 percent
  • Property taxes: 7.3 percent
  • Down payment: 22.9 percent
  • Interest rates: 12.6 percent
  • No issues: 20.9 percent
(The last category is interesting, because it's made up of predominantly female respondents who said they had no problems at all, and 29% of this category were also older buyers over 60.)

What is often not in the minds of people is how they can eliminate some problems with saving money for down payment if they're willing to eliminate expenses in their lifestyle.  This may be unthinkable, but yes, it should be done.  Why should a very well-off national/international coffee franchise be continually supported by you when it is not returning the favor by contributing to your down payment?  The point being that the daily disappearance of a few dollars is not thought of on an annual scale, but it makes a difference.   For instance, Chipotle is a place I love for lunch.  Even if I just buy my favorite steak bowl there, with no drinks or chips, it's now $8.07 including tax because they just had another price increase.  Let's say I go there 5 times a week:  $40.35 x 4 = $161.40 month x 12 = $1936.80 a year!  Just do that same calculation with your favorite lunch place and see what it adds up to.  You can do the same with weekend food, breakfast restaurants, or whatever. I love to select restaurant/dining out food as an item for economizing, because there's more opportunity to control it by eating at home more often.

If you are approved to buy a $450,000 home, your FHA downpayment will be at the rate of 3.5% (plus upfront MIP costs which can be folded into your loan amount).  That's $15,750 for the down payment.  Could you get there faster by figuring out where to economize?  This is the part where you priorities get prioritized if you want to buy.  Gas prices and student loan payments are non-negotiable areas, but there are many personal choices which can be changed and deposited into an interest-bearing account for the future!

6/27/2014

REALTORS® vs Real Estate Data and Your Home

Real estate data on the internet exists in multiple forms and multiple places.  I think the paradox is  that with all the available sources of data, many people are actually less knowledgeable about real estate "facts" due to the growing number of multiple choices to view real estate listings on the internet.

Issues:
  • Non-REALTOR® internet sources are not obligated by a code of ethics, and are not required to be licensed real estate professionals. Commercial sites obtain permission (in most cases) from MLS (multiple listing service used by REALTORS®) sources which contain the original listing information, and then publish it on their sites. Active listings syndicated from MLSs are not "public information" similar to what could be found in a search of property tax records for sold properties, but are the result of listing contracts signed between sellers and their licensed brokers which are then published on other commercial sites. Not all sellers want their addresses published this way, and some refuse to do so.  The National Association of Realtor code of ethics not only requires certain higher professional standards of REALTOR® members, they also may have a legal impact as well. For instance, in California an agent, governed by state law and by a code of ethics, may represent both buyer and seller in single transaction with the parties' agreement, but dual agency is a violation of the law in Colorado and Florida.
  • Skews data--i.e., days on market is undetermined when "pre-listed" as a "coming soon" listing on the internet that is not yet in the MLS . The number of days on market in the MLS is significant for seeing a trend between demand and supply--the more days on market may indicate more properties for buyers to choose from, or there may be a seasonal effect such as cold weather where showings are slow, or there may be more buyers have financial qualification problems so that properties are falling out of escrow and properties are coming back on the market. This information is just one fact not available when properties are sold off the MLS, and is not available for analysis by the many legitimate providers of real estate analysis, such as real estate appraisers, who utilize MLS information.  This is just one of factors in off-MLS listings.
  • Are off-MLS listings getting, you the seller, the best price and the most money for your property?  Off-MLS listings are may also be known as "pocket listings" or may be listed on specific non-MLS sites for individual sale.  Generally, a seller can be more assured of receiving a fair market price when his/her property is exposed to a broad market of potential buyers.  Since the MLSs exist nationwide as cooperative organizations composed of over one million REALTORS® each with their own database of clients, please see this article about determining what is in a client's best interest when choosing a private venue in which to sell property:  http://www.realtor.org/news-releases/2014/06/coming-soon-properties-can-create-consumer-confusion.
The internet, and competing housing data sites, is here to stay.  Buyers have become accustomed to searching online before even finding a REALTOR® to work with, and there may be certain advantages to that if the buyer is prepared with some prior market knowledge by the time a REALTOR is selected. 

For sellers who want to get market value, there are sites offering an "instantaneous" home evaluation price, based on property tax sales data and certain other measurements built into various proprietary software.  The software does not do what a human does, however, which is go inside the property for sale and develop human judgment about it.  Such software can be wildly inaccurate on price -- Zillow by its own admission can be as much as 30% away from actual sale price.  Companies such as CoreLogic may be a little more accurate, but no one should pinpoint the value of their property based on a software system alone. The illustration at right is from the Realtors Property Resource program and is an actual estimated 2014 value for a Long Beach property, showing an extremely large range with two stars for its level of confidence.  In an area of fewer matching comparables based on the data available to the software, it's tougher to come up with a tighter price estimate.  Don't you think the buyer would choose the lower price, and the seller wants the higher price?  A further illustration of comparisons of sold price vs. Zillow's Zestimate for actual Long Beach properties sold in 2014--due to CRMLS policies only the sold addresses can be sold--as provided by CRMLS.

Online source for housing values:

Metropolitan Sales Areas - Housing Data and Map--National Association of REALTORS®.

Web Statistics