Timely Real Estate News……………………………………….I5 February 2017
President’s Day — a long history
We love three-day weekends! President’s Day, celebrated this year on Monday, February 20, is the popular and commonly used name for the United States federal holiday officially called Washington’s Birthday after our first president, George Washington.
President’s Day was created in 1879, and first celebrated the following year. It was originally held on Washington’s actual birthday (February 22). In 1971 this was changed to the third Monday of February. It was the first federal holiday to be created in honor of an American citizen. The story of Presidents’ Day begins in 1800. Following President George Washington’s death in 1799, his birthday became a perennial day of remembrance. While Washington’s Birthday was an unofficial observance for most of the 1800s, it was not until the late 1870s that it became a federal holiday. The holiday initially only applied to the District of Columbia, but in 1885 it was expanded to the whole country. At the time, Washington’s Birthday joined four other nationally recognized federal bank holidays—Christmas Day, New Year’s Day, Independence Day, and Thanksgiving—and was the first to celebrate the life of an individual American. Martin Luther King Jr. Day, signed into law in 1983, would be the second.
The holiday was the result of the Uniform Monday Holiday Act that also included Abraham’s Lincoln’s birthday, which fell on the proximate date of February12. Congress passed and President Nixon signed the law to give Americans official federal holidays for a three-day weekend — also moved to Mondays was Columbus Day, Memorial Day, and Veterans Day, however after much criticism, Veterans Day was moved back to its original day of November 11 to celebrate the ending of World War I.
By the mid-1980s Washington’s Birthday was known to many Americans as Presidents’ Day. Today, approximately 16 states celebrate Presidents’ Day, and another 15 states observe Washington’s Birthday. The remaining states either don’t celebrate a holiday on the third Monday of February, or it’s celebrated in recognition of one or more of our founding leaders.
Enjoy your holiday weekend!
The usual suspects — prices up for some
Beverly Hills, Brentwood, and Westwood/Century City — three of the five communities I report on each month, showed median sales price increases for the first month of 2017. However, Beverly Hills Post Office and Bel-Air/Holmby Hills showed a marked slow-down in price growth, which reflec ted the dichotomy of the market as it’s been for some time.
There never seems to be any month when all of my communities are in positive numbers — they all get there eventually, and it’s not like we’re in a fickle market. For a large part, inventory or rather the lack there of remains the culprit — not just here on the Westside, but throughout the nation, which has caused many first-time buyers to frantically look for homes to purchase. Quality homes priced competitively move quickly, but in this sellers’ market, the homes that languish are generally those that are overpriced or have some other “issue”. For example, a house in my old “hood” of Beverlywood just came on the market and they already have about 25 offers! It is in the first-time buyers’ price category ($699,000), and will obviously be scooped up very quickly
Median sales prices up, down
For January 2017, Beverly Hills’ median sales prices were up 13% to $4.835 million compared to a year ago. Brentwood was up 4% to $1.880 million…and Westwood/Century City was up 40% to $3.100 million, a high for this popular area. But BHPO was down 30% to $2.900 million and Bel-Air/Holmby Hills was down 34% to $1,290, which was abysmally low for this mega-sale community where two $100 million estates sold last year.
As I do each month for The SchifferLine, I also report on other Westside communities — Culver City’s median sales prices showed a 16% increase to $1.127 million vs. $970 million a year ago. Sales volume for this popular city was $13 million for January vs. $10.5 million a year ago. Again, this falls into the arena of first time buyers’ price point.
Sales Volume starts slow….January can be a slow month in terms of overall sales in the five core communities, but this past month, sales were down 20% at $170 million vs. $213 million in January 2015. Bel-Air/Holmby Hills contributed most of this sales decline, behind by nearly
$38 million from its high in January 2015. “Yes, we have seen a slowdown in volumes throughout the Westside…and yes, blame it in inventory. We have the buyers…they’re out there. Multiple offers are the norm. We just need more homes for sale,” Carole Schiffer said.
But on the bright side, we saw many communities listing going below the 90% mark when tracking Original Listing Price vs. Sold Price…. but in this last month, only Beverly Hills was below 90% at 89% while the others were well above 90% with Westwood/Century City hitting 100%.
“All in all,” Carole stated, “We have had a solid month of inclement weather— a good thing for sure because of our drought, but it kept buyers inside. As we muddle through the wettest winter we have had in a very long time it will be interesting to see how the weather impacts the market. A few weeks ago, on a pouring Sunday afternoon, one of my colleagues had his condo in WLA open for the first time, and they had 40 guests, so it is obvious that there is strong motivation and buyers out there, no matter the weather! We’re all optimistic that ‘blue skies will be shining on our real estate market!”
Good news from the Fed? Rate hike in our future?
When Federal Reserve Chairwoman Janet Yellen painted a largely bright picture of the economy, she signaled, of course, that the central bank would consider raising interest rates next month. She didn’t actually come out and say, “…yes. We’re going to raise rates…” But with inflation tame and the labor market continuing to expand — the economy added a strong 227,000 jobs in January — Yellen hinted at the possibility of a rate increase at the Fed’s next policy meeting in mid-March.
The Fed “expects the evolution of the economy to warrant further gradual increases in the federal funds rate,” Yellen told the Senate Banking Committee last week as part of congressionally mandated testimony and a report on monetary policy. Yellen refrained from giving any public assessment of President Trump’s plans for tax overhaul and infrastructure spending, and what they may mean for the economy. Expectations for fiscal stimulus, and a rollback of business regulations, have sharply boosted financial markets.
Yellen noted there is considerable uncertainty in the outlook, citing as sources U.S. fiscal policies, the path of productivity growth and developments abroad.
Millennials less mobile? Research tells us….
Tell me that’s not true. The lovers of Snapchat, Instagram, Pinterest, and all the latest social media are now pegged as the least mobile generation of the last four according to a Pew Research report. In the Pew analysis of recently released Census Bureau data, only 20% of respondents aged 25-35 said in 2016 they had lived at a different address than the year before. That’s lower than the career-minded Silent Generation, inwardly focused baby boomers, and independent Gen Xers. “When I was your age…” a member of one of those groups might begin, “we had a one-year migration rate of 25 percent or above…” That might seem counter-intuitive, since millennials are less likely to be tied down by three of the biggest things that tend to hinder people from moving — a spouse, a house, or a child — compared to those previous generations, according to Pew Research.
You could blame it on this generation rejecting norms, needing to be coddled, spending too much time staring at screens or their iPhones — any handy scapegoat will do. But the answer becomes clear when you follow the money: They don’t have it. Since 2010 there are fewer currently employed 18-24-year-olds (54%) than at any time since the government started collecting data in 1948. And there’s a wider employment gap between young and all working-age adults than at any time in recorded history.
It’s surprising when you get under the data screen and realize that this younger generation is not as mobile as we have assumed (for every upcoming generation, I suppose). But even though the economy is adding jobs, they’re not the jobs millennials are seeking and in the real world, the gap is widening, not closing.
Mortgage rates going down, or are they?
You can hear it from the midway…”step right up, folks. Get the lowest rates in town.” Well, that was last week….but now there’s a new sheriff in town who has talked about lowering taxes, and that did the trick — investors pulled money out of bonds and treasuries, which only began to move mortgage rates upward. According to Market Watch, even with the upward pressure that stopped rates from continuing to drop, we may see rates moving downward this week. The Producer and Consumer Price Indexes are due, and neither is expected to rise much. Both Retail Sales and Industrial Production are predicted to show some deceleration from last month. And some are hoping, thank you, that Yellen will only have two rate increases this year. We’ll see what happens next month.
Foreclosures are down significant nationally, but….
If you’re in an oil-producing state (think Louisiana, North Dakota or Wyoming), this bit of good news hasn’t reached you yet…but the foreclosure inventory declined by 30% and completed foreclosures declined by 40% compared with December 2015. The number of completed foreclosures nationwide decreased year over year from 36,000 in December 2015 to 21,000 in December 2016, representing a decrease of 82% from the peak of 118,336 in September 2010.
The broad, overall decline of foreclosures (and those in the pipeline), indicate the trend will continue, although low oil-prices in those states with heavy oil production remain a challenge. CoreLogic, which produced the monthly report, stated that as the foreclosure inventory diminishes, the US economy must look ahead and tackle tight housing supply and growing affordability issues which are keeping many potential homebuyers, especially first-time buyers, on the sidelines.
Unmarried couples are buying homes…..
The national rate for younger, unmarried couples for buying homes together is now at 14.6%, which has been a trend for the past 10 years. In other words…”let’s buy a home first, and see if it works out.” According to one survey, some of the most expensive markets in the nation, including New York (12.9%), San Francisco (10.8%) and San Diego (10.6%), have generally seen 10-year increases in young, unmarried pairs buying homes —but those couples make up a smaller portion of home buyers compared with the rest of the United States.
Los Angeles still has a comparatively high percentage of young, single buyers: 32.7%. The national average is 25.4 percent. Young, single women (17%) are more likely to buy than men (15.7%) in the greater Los Angeles region. And some of the younger, unmarried couples are of the same sex. Bottom line, many younger people simply can’t qualify for a home loan without having help from a ’significant other’ even if marriage isn’t an option.
Over all how do we look?
The market has started a little slower this year than we have in the past. I am seeing some of my clients wanting to see how “things” roll out a little more before jumping into the sales or purchasing market. At the same time, I have several potential buyers who are looking for specific properties, such as a Canyon home in Bel Air Crest that has an elevator and another Canyon home purchaser as well. I also have a buyer for a home in Mountaingate with strong views. In addition, I have a lovely home available for lease on Brentwood for $11,500, and have a few other leases coming up in the next month or so in Bel Air Crest, and on Moraga Drive in Bel Air. Please let me know how I might assist you with any and all of your real estate needs.
The issue of Angeleno Magazine with me and 23 others on the cover will be out in the nextweek, and I would love to hear your comments and thoughts.
Please check out my web site… caroleschiffer.com, Caroleschiffer/realtor.com, www.facebook.com/CaroleSchifferRealtor, www.linkedin.com/incaroleschiffer, www.instagram.com/caroleschifferrealtor or @caroleschifferrealtor on your mobile
COUNT ON CAROLE
Marketing Skills Count
Being one of Coldwell Banker’s top agents on the Westside is testimony to my marketing skills. As your Realtor, I use every effective and efficient marketing tool to insure success for your transaction, either as a buyer or seller. From an intensive e-marketing campaign to direct mail to advanced communications strategies, my marketing skills count!
Carole Schiffer. The Westside Expert