Notes on a Realtor’s Scorecard
-A few quick notes heading into the much needed holiday weekend. I think 2010 can definitely be characterized as the year of the grind for those with jobs and those trying to find work. On the real estate side of things it seems to compute to 1/3 more hours and the deals typically being 1/3 harder to navigate…
Fast Track to Escrow: 331 South Medio in Brentwood went into escrow immediately after the first broker caravan. The Spanish style home boasts only 2,176 sq. ft. and probably went out around the 2.399 list price…538 14th street in Santa Monica immediately went into escrow around its 2.450 list price. It only lasted 1 day on the market. The 2,866 sq. ft. home needed a little work. . .265 Homewood Road in Brentwood debut on the market this week at $5.195 and had the realtors buzzing during the caravan. Many felt it was priced really well and were threatening to present offers. I imagine this 5,366 sq. ft. home on ½ acre will go for over its asking price.
-The Rich Get Richer: 11 of the 50th wealthiest Angeleanos are from the real estate industry according to the Los Angeles Business Journal. Many of them are builders who have seen net worth jump lately with the recent strength of the market.
-Getting Ready For Summer: The Santa Monica Pier was ranked the fifth most polluted beach in California… Slightly beyond the Santa Monica Pier at the beach near Strand Street, the water is considered part of Heal the Bay’s “honor roll,” meaning that it meets 100 percent of the requirements of water quality standards.
-Pool Party for the Holiday Weekend: Looking for a pool party this weekend? Local hotels like the Shangri-La might be your best bet. Check out this article from the LA Times…
MAKE IT A GREAT MEMORIAL DAY WEEKEND AND REMEMBER TO CELEBRATE THOSE WHO HAVE PROTECTED THIS GREAT COUNTRY!!
Legal Battle in Venice Over Affordable Housing Complex Comes To End
A contentious legal battle involving a rent-controlled apartment complex in Venice that was built after World War II to house veterans unable to find affordable housing has finally come to an end with the Los Angeles City Council’s approval Wednesday of a settlement that will return evicted tenants to their homes.
The council ratified the agreement with AIMCO Venezia, owner of the 38-acre Lincoln Place apartments, located just south of Santa Monica near Rose Avenue. The settlement was reached after 18 months of negotiations.
Under terms of the agreement, AIMCO, will: allow 83 evicted households to return to a rehabilitated Lincoln Place at pre-eviction rental rates; establish a multi-million dollar fund to compensate former tenants not returning to Lincoln Place; and restore 696 vacant apartments to market as rent-controlled units.
AIMCO may also construct up to 99 new rental units with a clubhouse and other recreational facilities on vacant property where the company demolished 99 units in 2003. In a bow to community sentiment, AIMCO and city officials agreed that the height of the new buildings cannot exceed 30 feet and AIMCO waives any right to a density bonus.
Nearly all of the apartments have been vacant for years because of legal entanglements and has been something of an eye-sore for local residents.
The settlement represents the largest-ever restoration of rent stabilized housing in the city’s rental market.
AIMCO, one of the largest real estate management companies in the country, had plans to redevelop the property, placing condominiums and luxury apartments on site with 140 low-income units, according to previous reports.
Lincoln Place, a garden-style campus of 52 buildings built in 1951, was originally backed by the Federal Housing Authority when it was built in 1951 to support World War II veterans and their families.
However, it has always been privately owned.
*Sources: Santa Monica Daily Press; Press release from Councilman Bill Rosendahl’s office; The California Registry of Historical Resources
Mortgage Rates: How Low Can They Go? 4.21% for a 15 year mortgage…
Homeowners able to refinance and purchase this week were finding lenders offering 15-year fixed-rate mortgages at an average of 4.21% this week, according to Freddie Mac — the lowest rate since the mortgage company started tracking the 15-year loan in 1991.
Heavy demand for 10-year U.S. Treasury bonds has pushed their yield to the lowest level of the year.
That’s down from 4.84% a week earlier and not far from the record low of 4.71% set back in December.
With mortgage rates near record lows, homeowners are applying to refinance their loans at the highest rate in seven months. The volume of refinancing jumped 17% last week as the average contract rate for a 30-year fixed mortgage sank to 4.80% from 4.83% a week earlier and it was the highest volume since October.
In contrast to the latest refinance boom, applications to purchase homes fell further after a sharp decline the week before. The refinance share of mortgage activity was at 72% of total applications, up from 68% the previous week and the highest refinance in the survey since December 2009.
Industry observers said any home purchasers who could do so completed their transactions by the end of April, when federal tax credits expired for people buying houses.
Freddie Mac gathers information about rates available to well-qualified borrowers who make a down payment of at least 20% or have equivalent equity in their homes if they are refinancing. The borrowers in this week’s survey would have paid 0.7% of the loan balance to the lenders in upfront fees and discount points, Freddie Mac said.
Last year, the experts expected residential mortgage rates would be rising by now, as federal housing and home-loan support programs expired, home prices stabilized and inflation became more of a concern.
Then the latest default scare reared its head — this time involving not U.S. home loans but the debt loads carried by Greece and other weaker European economies. “Just when we thought we were finally experiencing [the anticipated rate increase] we got the PIGS,” said Stew Larsen, head of mortgage banking operations for Bank of the West, referring to an acronym for the nations Portugal, Italy, Greece and Spain.
For those hungry for lower rates, is this the last big chance to head to the trough?
Source: LA Times (Money and Company Blog)
Ranking the Most Desirable Streets In Los Angeles
The golden triangle from Beverly Hills in the east to Santa Monica on the West and Mailbu to the north encompasses is considered one of the most desirable places to live in the world and encompasses a majority of the best streets in Los Angeles. Functioning as a playground for the rich and famous these streets comprise some of the best mansions in town and are the residences of some of the most influential people in the world. Thanks to growing up in the area and articles about the subject in the Los Angeles Times and Wall Street Journal, here is a rundown of the most desirable streets and my stab at ranking them.
1- Mapleton Drive, Holmby Hills: Backing up to the fairways of Los Angeles Country Club, Mapleton Drive was ranked one of top streets West of the Mississippi by Wall Street Journal. The quality and size of the properties along with the views of Los Angeles make it extremely coveted. Home to the Playboy Mansion, high-end buyers feel very comfortable purchasing property where everything around it is established with at least a 10-20 million value and sometimes well beyond that.
2- Oakmont Drive, Brentwood. This private street at the end of Rockingham Avenue is very secluded and a perfect getaway from the hustle and bussle of Los Angeles. The street never has any traffic on it and is known for its secluded setting, large mansions and powerful residents. Another 10 million++ street.
3- Bellagio Road, Bel-Air: The highest-price home transaction ever in California took place on this street. The 2000 sale of an 8-acre estate by Dole Food Co.’s billionaire owner, David Murdock, to financial executive Gary Winnick in a $95-million deal. Most of the lots are flat and views of the Bel-Air Country Club and the ocean distinguish this leafy road paralleling Sunset Boulevard.
4- North Carolwood Drive, Holmby Hills. Just around the corner from Mapleton, North Carolwood has been the address of tons of celebrities. At 2 to 4 acres, these are some of the biggest parcels on the Westside and can sell in the $20-40 million range.
Gregory Peck’s longtime home was sold in 2004 for about $22 million. Michael Jackson rented here at the time of his death.
5- Malibu Road, Malibu. This coastal street is shielded from busy PCH to the east, offering ocean views and a relatively quiet neighborhood that celebrities love. Those who buy on this street tend to stay a very long time.
6- Napoli Drive, Pacific Palisades. Properties on the south side of Napoli are prized for their views overlooking the Riviera Country Club and considered the most desirable in ritzy Pacific Palisades. Having a backyard bordering a golf course is like having a park behind you.
7- La Mesa Drive, Santa Monica. Napoli’s neighbor to the North that borders Riviera Country Club, La Mesa is known for its homes of similar value and size and once you turn onto the street you feel you have ventured into a quiet city in another part of the country. Large trees help provide privacy and locals note a strong consistency despite each house being unique in its own way gives the street high marks. Homes “on the rim” side of Riviera can bring close to twice as much as south-side properties.
8- Amalfi Drive, Pacific Palisades. North Amalfi has canyon views to Will Rogers State Historic Park, while some homes on the south end have ocean and Riviera views. Over the years it has been popular with such entertainers as actor Cary Grant, comedian Jerry Lewis and singer Bobby Vinton.
9- Maple Drive, Beverly Hills. Maple Drive, north of Santa Monica Blvd, boasts the largest lots among Beverly Hills’ flatland areas, and the homes have a continuity of design and landscaping. The street is quiet and traffic is light despite being right near Sunset. Homes usually value in the $10 million plus range
10- Bel Air Road, Bel-Air. Approached through the arch at the East Gate entrance of the community, this winding street has city and ocean views as it climbs. Tall, dense hedges create an air of inaccessibility and its location is close to Westwood Village.
Other Top Streets:
**Malibu Colony Drive, Malibu.
**Georgina Avenue, Santa Monica
**Corona Del Mar, Pacific Palisades
–*Sources: Los Angeles Times; Wall Street Journal…various articles written in the past few years.
A Look at Buyer Purchasing Power with Rates at Historic Lows
One of the main factors in the recent surge in home sales is that mortgage rates continue to stay around historic lows keeping a traditional buyers purchasing power at high levels. At some point in the near future conventional wisdom leads one to think that rates will eventually have to rise for the benefit of the whole economy.
I thought this would be a good time to look at the difference in payment for a purchaser if interest rates escalate and how it could impact the market. It is also a great tool for those of you who are beginning the search for a home.
Some people feel this is an excellent time to make a long-term purchase due to these rates and also unload a property that you will be selling in the next 3-5 years. The record low interest rate not only aides the buyer but also the seller who has been saved in a further drop in property value during the great recession.
The economy is showing signs of rebounding and consumer confidence in the California home market is on an upward trend. However, will the market be able to sustain an eventual hike in interest rates when salaries are not increasing?
As you will see below, a purchaser’s payment is impacted quite a bit by even a half-a-percentage point increase and the banks are very strict in staying within the confines of the maximum amount a purchaser can qualify for based on a % of the purchaser’s gross income which is usually in the 36-41% range**. Please note that property taxes, insurance and other liabilities factor into this and you are strongly advised to speak to a licensed lender about the process since this information can and will fluctuate. I am happy to put you in touch with some of the best lenders in the business and we are happy to address any questions you may have.
*Click Image to Enlarge
No Rent Increases in Los Angeles?
Debate over the city’s Rent Stabilization Ordinance kicked into high gear May 7, when the council voted 8-6 to have the city attorney draft a moratorium that would prevent for up to six months apartment owners from levying the usual 3 percent annual rent increase at rent control units.
The Los Angeles City Council on Friday is scheduled to consider an ordinance preventing the owners of thousands of apartments from imposing an optional 3% rent increase between now and Oct. 31.
Notes on a Realtor’s Scorecard
*I have noticed quite a few out of area agents representing buyers when the final sales info comes into the MLS. Thanks to the internet and most of the MLS services in the state working together it allows agents to work almost anywhere. However, many of these agents seem to be representing buyers who are paying a decent amount more than what the local agents think its worth. . .Great for the neighborhood but not for the buyer. . .This is why I like to work with an area specialist when I wonder into communities I am not familiar with outside the Westside/South Bay to make sure my clients are completely plugged into everything that is going on.
*839 25th street in Santa Monica just hit the market for $2.875. It is a very nice remodeled 5 bedroom, 3,200 sq. ft. home situated on an 8,000 sq. foot lot just south of Montana. The home shows very well and is located a block from Franklin Elementary school (one of the best in the state). A perspective buyer might fall in love with it due to the condition of the inside and location of the home but I think they are overpriced by about 7-10%…It will be interesting to track what happens. It was quite the buzz on caravan since it has very little competition and would be very attractive for a family looking to get into the Franklin school district.
*14173 Alisal Lane in Santa Monica Canyon is a Ray Kappe designed modern architectural located on a fabulous 11K lot that came on the market in late April for $2,395,000. It was priced around land value as the home needs a ton of work. However, the buyers were undaunted due to the low price and the property received 8 offers with the majority of them being all-cash buyers. The frenzy of interest is rumored to have driven the sales price to around $3,000,000…A good design on a large lot will command interest in any market…
*Good article in the LA Times about new homebuyers reemerging in California. The $10,000 tax credit that goes toward the purchase of new construction that began May 1st will be a contributing factor…Article: New Homebuyers Reemerge
* Interest rates on mortgages have declined for a fifth straight week, with 30-year fixed-rate loans dropping below 5% to the lowest level of the year, Freddie Mac said in its weekly survey of lenders. The average rate that lenders were offering for 30-year fixed home loans was 4.93% early this week, down from 5.0% a week earlier, with borrowers paying 0.7% of the loan balance in upfront charges to the lenders.
* Having trouble making mortgage payments? If you have a mortgage with Bank of America, you may be in luck. The nation’s largest consumer bank says it has modified about 56,000 mortgages this year under a government program aimed at reducing the number of foreclosures. The program allows qualifying borrowers to temporarily reduce interest payments or modify mortgage terms in other ways. After a three-month trial period, the bank can then make such changes permanent. BofA, like many big banks, had dragged its feet on helping homeowners and are still extremely slow to react. Of homeowners who haven’t made a mortgage payment for over a full year, 23.6% haven’t been foreclosed upon.
*2.2% of all housing units in the US (1 in 45) received at least one foreclosure filing in 2009…Foreclosure filings were up 19% in March and up 8% year over year…that doesn’t sound promising for a full recovery does it?
*If home prices drop 10%, the percentage of underwater homeowners would increase 56%!
Quick Look At Specific Sales From Westchester to Pacific Palisades
I will continually update you regarding sales I am familiar with in certain areas which will be a great tool in helping you properly value properties. Please feel free to contact our office if you would like more specific information.
16578 Charmel Lane- Pacific Palisades- 3 bed/3 bath 3,176 sq. ft. home on a 15,110 lot. Tremendous view property that found the perfect buyer since it sold for about 10% more than what most realtors predicted. The house needed a lot of cosmetic work and a little re-working but once that is done it will be awesome. This is a house that someone could easily fall in love with so I am not completely surprised it sold for 2.535, just off the 2.595 list price.
939 20th Street #3- Santa Monica- 3 bed/3 bath, 1,853 sq. ft. New Construction Townhouse with sundeck. Listed for $1,395,000 and sold for $1,350,000. A total of 8 units in the building and I believe this is the fourth one to sell. The units are very nice and built to be the only LEED (energy efficient and high environmental standards) certified townhome community in SM.
7100 Playa Vista Drive #314- Playa Vista- 2 bed/3 bath 1,689 sq. ft. built in 2007– Listed for $629,000 and Sold for $620,000. 3 story condo with bluff and mountain views. Good floor-plan with side-by-side parking. A property like this would have easily sold for over $800,000+ in 2007.