A Little Random Data About the Long Beach Market in August 2019

As of August 26th, there were 299 active listings for single family homes in the MLS:

Smallest house for sale = 480 sq. ft.
Largest house for sale = 7692 sq. ft.
Lowest list price = $375,000
Highest List price = $11,995,000
Longest days on market = 525
Listings that mention a bomb shelter = 0
Listings that mention walk score = 4
Listings that mention a pool = 30
Listings that mention granite = 77
Listings that mention an ADU = 7

On occasion, there is a listing that describes a bomb shelter (a 1950s era feature); walk score has gotten a lot of talk in the past, but where is it now?; pools are very much in the market, but not desired by everyone; granite couinters hit the big time for over a decade, but may not be desired by all buyers who may decide other material, such as quartz, is more to their liking.  And ADUs (accessory dwelling units) were passed into law in California as an attempt to help ease the affordable housing crunch--if you are thinking of adding one, be sure to check in with the City's requirements first--the upside is they are good way to have a second legal unit without having to be in an R2 zone.

If you are interested in looking into a property with these characteristics (or without) and want to know more, just contact me!

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

How a Listing Went From $1 Billion to A Low, Low, Selling Price

This story could be the story of many sellers, albeit on an exaggerated scale.  How did a property on the market for $1 billion dollars ultimately sell for .1% of that, or a 99.99% loss?

It's the story of an investor buyer who wanted the 157 acre parcel in Beverly Hills, and to get it he borrowed $45 million from the seller (Mistake No. 1), the Mark Hughes Estate, and bought it in 2004.  In time, the debt surged to $200 million with interest and fees added. The investor transferred ownership to an LLC controlled by the investor's partner, which was unsuccessful last month in declaring bankruptcy.  The Hughes estate could either buy the property back, but lose the $200 million it was now owed, or let it go to foreclosure auction. But any other buyer purchasing prior to the foreclosure auction would have to pay the $200 million in debt, and there were no takers. So the property went back to the Hughes estate, after 15 years, leaving it to absorb the $200 million debt.  However, the LLC, known as Secured Capital, made a last minute offer of $150 million for the property, but the estate ignored the offer, according to the company's attorney (Mistake No. 2).  So last week, the property sold for $100,000 at auction. 

So 1) don't overprice your property; 2) or do a carryback loan to a buyer who can't perform, 3) and, finally, know when to cut your losses so you don't lose out completely (the estate could have at least recouped $150 million) and then, end up selling at a below market price that you can't even buy a condo for.  And last but not least, check your days on market, and keep checking your market value.


Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

July 2019 Market Prices for Houses in Long Beach

No matter what is said about housing affordability up to this point, the house prices continue upward overall.

In January 2014, the average price of a single family home in Long Beach was just under $500,000. Following the peaks and valleys all along since then, the average price in July 2019 was $775,352, while the median (midway point of all SFR's sold) is $660,000, vs $455,000 in January 2014.

Days on Market:  July, 33 average days on market. This is time before an accepted offer, so what does this mean? You can't waiting around forever before making an offer.

List to Sold:  In the last 5 years, houses have sold in the range between 97% of list price to 100% of list price, with the July average at 98.6% of original list price.  So what does this mean? That you have to make your offers strong.

Months Supply:  This is the amount of inventory on the market before it would run out at the current rate of sale, and this has been ranging, since 2014, between 1.5 months and 3.5 months.  It's been a long time since the 6 month supply level, considered the market norm, has been around. So what this this mean? Limited supply helps drive prices up, less inventory,  continued demand.

Closed Sales:  Since 2014, this varied  between monthly lows of 102 and 106 SFR closings a month, to 259 a month.  In July, 212 single family homes sold.  What does this mean?  It's not unusual for low sales in January and more sales in the summer.  Since 2008, the highest number of sales were in August 2012 (260) and June 2017 (259).   Per data on the MLS, just to compare, going further back to January 2000, 183 SFRs were sold; in July of 2001, 350 SFRs were sold.  So our market volume has slowed consideredly since that time, and prices have gone up.

But buyers are still looking to buy, so if you are thinking about selling, even if you're not sure when, whether you have a house, condo, or unit properties, please contact me. I can work with trust and probate properties also!

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

It Just Got Easier to Buy and Sell Condos with FHA

Downtown Long Beach condo view

As I've previously posted,  condos haven't gotten a break from HUD for a long time.  Many HOAs, if not most, in Long Beach lost their FHA certification and didn't renew it.  It was once a permanent approval, but due to the 2009 and later mortgage fallouts, HUD required HOAs to renew their FHA loan approvals every two years.  For most Boards, that's a nano-second.  Plus, HUD removed the ability to get a "spot" approval, meaning a single unit could be approved for an FHA purchase, even if the rest of the HOA was not approved.

Finally, HUD is giving back.  Effective October 15, 2019, the new rules (click on the title link) will:

Extend the approval period from two to three years;
Allow for "spot" approvals, those single unit mortgage approvals, up to 20% (currently, none are allowed);
Allow additional flexibility in the ratio of investors to owner-occupants in the association, between 25-75% (currently, 50% owner occupancy required).

To give an idea of how this will help FHA buyers, nationally there are more than 8.7 million condo units, but only 17,792 FHA condo loans were originated in the last year, according to the National Association of Realtors.

These loans changes may also come under specific lenders' requirements, so who you work with on youir FHA loan may have an impact on what HOA may or may not be eligible.  However, since lenders want to make loans, there should be a lot of incentive to help a qualified buyer complete a condo purchase.
These new changes are very beneficial to condo sellers, who should find a buyer faster when not owning in an HOA-approved building.

If you are interested in finding out about a condo purchase, Please contact me.  I've been helping buyers and sellers since 1994!


Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

Are You in Shock? Did Loan Forgiveness Affect Your Credit Score?

But not in a postive direction?

A consumer or borrower might think that getting rid of a loan would improve a credit score.  But the reality is that in spite of all the talk about helping students, for example, by helping them obtain cancellation of the school loans, just the opposite happened. In fact, I know of a non-student case where a borrower's second mortgage was voluntarily forgiven by the lender, but then that person went to obtain a new purchase mortgage loan approval to buy a second property, and their credit report now showed a foreclosure. And apparently, according to the New York Times, some student borrowers are finding that their loan servicers are reporting they are delinquent in loan payments,  rather than a debt forgiveness.  The next problem is that the loan servicers seem reluctant to correct these reporting errors, and thus the borrower's FICO score drops, and it may be enough to prevent obtaining a credit card, or a loan.

A mortgage borrower could notify the Consumer Financial Protection Bureau, assuming he/she has the documentation that the loan was cancelled. Also, a dispute concerning the reporting error could also be initiated through the credit bureaus. 



Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

Here Are Important Tips For Your Online Home Search

Hunting for a new home online is a great place to start your search, but it should not be your end all be all. Good listing agents are excellent at highlighting the best features of the home, but keep in mind there may be more than meets the eye. To make the most of your time and efforts and gather a well-rounded picture of home listings online, keep the following three things in mind.

1. Stay up to date. When you start your search, make sure you find a site that pulls up-to-date listings directly from the multiple listing service (MLS) where real estate agents actively post their most current homes for sale. Many online resources update less often or fail to remove listings that are off the market, making it more difficult to sort through the clutter.
2. Pictures can be deceiving. Real estate photographers are experts at showing a home in the best possible light. Many use tools and strategies to boost appeal, such as a fisheye lens to make areas look larger and creative editing to make colors and textures really pop. But, often listings will not contain photos of unappealing parts of the home, like small closets or outdated bathrooms.
3. See it to believe it. Once you find what appears to be your dream home online, call up your REALTOR and schedule a showing. You want to take the opportunity to vet the home in person and explore every part of it before beginning the offer process. Your REALTOR will help you cover all your bases and will ask questions you may not have thought of.

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Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

For Sale in Long Beach in El Dorado Park Estates

El Dorado Park Estates home

Just reduced, great opportunity in desirable area of Long Beach, CA. 

Would be great for a buyer who needs a downstairs bedroom, a pool, and a remodeled kitchen with newer cabinets and granite countertops.  Sliding door from living room to pool area, formal dining room plus large eating area next to kitchen.  Central air and heat, great for the warm weather days. 

Direct access from the two car garage. Home has a total of 5 bedrooms, 3 baths. There are only two other houses on the market besides this one that have 5 bedrooms, not common!  Near El Dorado Park, the Long Beach Animal Shelter, close to Rossmoor shopping center. Near Newcomb Academy in Long Beach.
Price is now $919,900.00.  To see this property, contact me, easy to show.



Listing Broker El Dorado Realty SoCal.

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

Average Selling Prices for June, 2019 in Long Beach,Lakewood, Cerritos, Huntington Beach and Three Counties

View of downtown Long Beach

All these prices are for the month of June, 2019, based on data from CRMLS Infosparks:

Average prices for single family homes in Orange County were showing a slow downward trend since early 2018 but shot upward in May of this year, while Los Angeles County is trending up from $919,000 in December 2018, and San Bernardino County's average is now up the highest in the last 18 months as homeowners and investors find buying opportunity there.
The average days on market for the four cities is about the same as before.  However, in the very high end markets in Long Beach, properties over $1 million are generally on the market longer than those under $1 million.

Average single family home prices vary according to area, and here's what they look like locally:

June, 2019

Long Beach
$749,502                 Avg Days on Market : 33

Lakewood
$612,286                 Avg Days on Market : 28

Cerritos
$784,959                 Avg Days on Market : 43

Huntington Beach
$1,239,491 (18 month high)   Avg Days on Market : 40

Los Angeles County
$968,802 (still down from a high in May, 2018)

San Bernardino County
$377,243 (highest average price in last 18 months)

Orange County
$1,085,899 (down slightly from May 2019 18-month high)

 

For condo prices, please contact me!

For an online and automated home valuation, try my site at http://www.juliahuntsman.com/home-evaluation.  It probably works more accurately for single family homes than condos in some areas, depending on what properties lie within about a one-mile radius.  Try it!  And I am always happy to do a more customized report to send out via e-mail.  If you're thinking about making a move, do it! It pays to keep an eye on things.

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996 Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

The State of the Nation's Housing 2019: Harvard University Annual Report

What It Takes to Buy a Home in the U.S.

This forty-four page annual report describes housing issues on a national basis, so this is not the place to look for your local neighborhood or city stats.  Just keep these points in mind for your general knowledge.  The entire report may be viewed at the end of this post.

Housing supply has been discussed constantly, especially in California.  There was actually an oversupply of housing between 2000-2010, but since then builders have been slow to catch up, especially in the last 8 years.  The report goes on to list various reasons for this: builder hesitance, labor shortages, new housing being built for the high end of the market instead of lower end, rising  cost of materials make it difficult to build for the middle market, and objections to high density development in many areas.

But homeownership nationally is up to 64.4 percent, with the largest increase in the 25-39 age group, in spite of worsening affordability.  In California in 2017, homeowners numbered 7,137,000, at 54.9 percent of the population of 13,005,000 households. California ranked the highest of all states in the nation for number of homeowners, but states such as Delaware, Iowa, Michigan, Utah, and others, ranked higher in percent of homeowners, with New York being slightly lower in homeowner percentage compared to California, per the US Census Bureau, 2017 Community Survey.

The millennial and baby-boomer generations will be the two largest groups for housing demand:  "These two large generations will propel growth in 35–44 year-olds and lift the number of older adults to new heights." The 65 and older crowd  will grow by 11.1 million, and 35-44 year olds will grow by 2.9 million, all in the next decade.  This will be an increase of 8.4 million households for baby boomers, who are largely expected to age in place.  The demand for entry level homes will increase for the 35-44 year olds, the group with the most children.

The highest affordability rates are in metro areas where the home values are less than 3 times the income, and the median-income home could afford 84% of recently sold homes.  These markets are primarily in the midwest and northeast, where as the California coastal areas have home values approximately 6 times the income.

Assuming the current housing supply issues, and the continued demand for more housing, house prices and rents are expected to continue an upward trend.  And the constraints on housing development must be addressed.  In 2018, single family starts rose 9 percent in the West.

For the full report, go to the State of the Nation's Housing site.



Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996

What Is An iBuyer?

.... an internet buyer making an offer through one of several companies which claim to speed up and simplify real estate transactions, appealing to the convenience factor for both buyers and sellers. Offers are made sight unseen, based on a proprietary valuation model.  Maybe the speed is appealing, these after all are investor buyers, and you may need to sell quickly because you're in foreclosure, or some other type of distressed situation.

But the seller doesn't always know that these companies will still charge full commission, plus discount the fair value of your home in exchange for all that ease of sale. While this type of sale is relatively new to the market, some estimates are that the actual costs to the seller amount to a fullj 10% of the value of the home, whereas selling with a traditional agent could mean a 6 percent commission. 

"So what does this really mean for the homeowner’s bottom line? Most homeowners purchase their home with a mortgage. If you purchased your home for $400,000 with 20% down, you showed up to closing with $80,000 of your own money, which is also your equity. If the value of your home remains the same and an iBuyer offers you $380,000 for your home — a 5% discount to fair value — you will lose $20,000 on the value of your home, plus pay a 5% commission (an additional $19,000). This is a higher transaction cost compared to selling on the open market for $400,000. More importantly, compare that combined $39,000 to your original down payment of $80,000 -- you will be giving up close to 50% of the equity you put into your home partly for the convenience of a quicker sale. Does the added cost make sense for the consumer?" *

 In 2018, Zillow said that 90 percent of sellers who engaged its Instant Offers platform did not follow through and chose a traditional agent instead. A traditional agent is there to guide the seller through the many disclosures and legal requirements of selling a home, and in California there are many. Before a seller considers this type of transaction, he or she should carefully investigate the actual costs, the home's fair market value, and the completeness of the transaction.

For an estimate on your home, please contact me.  I've been helping buyers and sellers for almost 25 years!



*Forbes Magazine, June 5,2018

Julia Huntsman, REALTOR, Broker | www.juliahuntsman.com | 562-896-2609 | California Lic. #01188996