Timely Real Estate News…………………… 15 March 2010
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Happy St. Patrick’s Day…..a little pinch will do’ya if you don’t wear green
We’re all Irish on St. Patrick’s Day, March 17. It’s one of those fun, frivolous holidays that many take to heart — and drink. It’s always a good excuse for ordering ‘green beer’ and the traditional corn beef and cabbage. We Americans tend to ‘bend’ the holiday to fit our own unique interpretations — for example, as I have pointed out before, the ‘traditional’ Irish meal of corn beef and cabbage is more American than Irish, but who’s counting. And what about pinching folks who are not wearing green on St. Patrick’s Day? This is an American tradition, having really nothing to do with Ireland or St. Patrick. According to legend, pinching started in the early 1700s — about the time that awareness of St. Patrick’s as a holiday came to the fore — in Boston, then a Massachusetts colony. The Irish thought if you wore green, it made you invisible to the Leprechauns, which was good, because they would pinch anyone they could see. So pinching is to warn and remind you about the Leprechauns and their ‘pinching ways’. I always wear something green…it’s a fun way to make Leprechauns happy and besides, it’s fun to be Irish for the day.
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Sales volume remains strong….but median sales prices decline
On a more serious side, we are seeing continued strong home sales for Beverly Hills and Bel-Air, where sales volumes are streaking far ahead of last year. As of the end of February, year-to-date sales volume is $240+ million vs $136+million for 2009, a 76% increase. Beverly Hills is more than $70 million ahead of 2009 (year to date), and Bel-Air is $32 million in front of last year, which accounts for most of the increase.
More importantly, median sales prices for the year are down across the board. Beverly Hills is down 17% to $2.907 million; Beverly Hills Post Office is off by 31% to $2.676 million; Bel-Air is down 28% to $2.570 million; and Brentwood is off by 39% to $2.750 million. Overall, the four communities are averaging nearly a 30% drop in median sales prices. Based on the wide-ranging median sales prices for the first two months of the year in some areas due to several large estate sales (for example, February sales for Beverly Hills was 193% ahead of February 2009), lending credence to the monthly median sales prices for 2010 is specious at best. One of the reasons for the strength of Beverly Hills is there were a number of BIG sales in February — $16.5 million, $12 million, $10 million, $8.8 million, and $7 million. There was also a sale of $6.250 million in BHPO, one for $5.2 million, and another for $4.5 million in Bel-Air, and none over $3 million in Brentwood for the month. Median sales prices – year to date – has Beverly Hills Post Office down only $2 million, and Brentwood sales are up just $4 million over last year.
We consistently look at trends, and so year-to-date comparisons have more validity in trying to speculate where our market is and where it is going. We are seeing larger sales volumes dragging down median sales prices because of the increase in bank-owned real estate (REO) that has greatly increased everywhere. And quite frankly, this trend will continue as we are seeing more and more foreclosures and short sales occurring, even in our strong real estate market on the Westside. The recession and unemployment are affecting everyone. And while recent reports show that fewer entered the foreclosure process in February, there are more than 7 million homes in the US right now that are facing foreclosure according to the National Association of Realtors. California ranks 4th in the US in terms of foreclosures.
Is this a good time to sell or buy? Anyone will tell you in general terms it’s a buyer’s market. The downward pressure on home prices caused by the recession and falling home values has created this buyer’s market, so for buyers it is a good time to enter the market. However, do not kid yourself — when a property is properly priced, we are still seeing multiple offers. In Westwood the other day, a house on Kelton was listed at $875,000, and it generated 15 offers!! Negotiations are still going on, but I can tell you that it will definitely sell well over the asking price, probably over $1 million. This is going on all over the Westside.
Open houses are seeing strong attendance. In my open house on Stonehenge in Bel Air Crest a little over a week ago, which is priced at $6.2 million, I had over 20 groups, and I think the majority of them are real buyers, not “looky loos”. So buyers are out there! But they are generally taking their time except when they feel a strong compulsion to act immediately.
If you’re thinking of selling your home, make sure you do your research. Pricing is critical — and that has never changed. Location counts but so does presentation. The most important consideration: Hire an experienced, trusted Realtor who knows your neighborhood. They will maximize your potential and efficiently manage the process. Yes, these are challenging times, but I have many clients in the past year who have achieved the success they wanted.
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There is another issue I would like to address and that is the ability for buyers to obtain loans. Yes, it is more difficult for a buyer to obtain a loan, and in some ways that is a good thing, but many times, it is not the problem with the buyer, but that of the appraisal/appraiser for the property. Because lenders are being squeezed to lower their fees, many lending institutions are going to appraisers who are not local to our area. The problem with that is that these “out-of-the-area appraisers” are not familiar with our area, property, etc. So with the foreclosures occurring all over Southern California add to the lower prices they are bringing, many times those appraisers are just going with the numbers, rather than understanding the properties and reasons for a lower price. This ‘methodology’ results in appraising a property that may not have “issues” the same as one that did. That is another reason why it is very important that you work with an experienced agent that knows how to deal with these situations, and who knows how to require a local appraiser if necessary. Whether you are a buyer or seller, what you are really looking for is a successful transaction!
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Carole Schiffer Named in Top 2 Percent in US for Coldwell Banker
And speaking of success, I have been recognized as one of Coldwell Banker’s Top 2 Percent Realtors in the United States this past week for 2009. This is a great achievement for anyone in these challenging times, and I’m proud to have reached this level of success — but really, it’s an honor bestowed on my clients as well — who have given me their trust and business over these many years….so thank you!
Short Sale Specialist…..call me if you need help!
I also want you to know that I have just completed my certification as a Short Sale Specialist and can help you or anyone you know who is facing foreclosure and needs assistance in considering any of the options available to you. Please feel free to call me any time….310-442-1384.
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Here’s a short guide to the Foreclosure ‘lingo’ — as provided by the National Association of Realtors
There are so many different elements of the foreclosure process, it is important to understand the various ‘phases’ that this procedure entails: Foreclosure is a legal process by which a defaulted borrower is deprived of his or her interest in the mortgaged property. Many people describe a foreclosure as a type of property. It is not. Also please know that a foreclosure process with the bank and a short sale process can run side by side with the bank. They are not handled by the same department and that has to be dealt with also. All in all, it is tricky business.
Terminology and Process
Pre-foreclosure –The period beginning with the initial mortgage default up to and when the distressed property is sold. The length is what is considered pre- foreclosure varies depending on the state.
NOD – Short for “notice of default”. This is an official notice from the lender that the borrower has defaulted on the mortgage. The NOD formally begins the foreclosure process. The NOD also outlines the reinstatement period.
Reinstatement period – The time stipulated in the NOD in which the borrower may reinstate the loan – making required payments and bringing one’s account into good standing
Short Sale –A situation in which the seller (1) owes more money on the loan than the sale of the property will likely produce on the market (2) is unable or unwilling to bring money to closing. The seller may or may not be in pre-foreclosure.
Notice of Sale – If, after receiving the notice of default, the borrower does not or is unable to reinstate the loan, a notice of sale is recorded. The notice of sale explains when and where the foreclosure sale will be held.
Foreclosure Sale – Also known as the Sheriff’s auction, sheriff’s sale or trustee’s sale, this is when the property is auctioned for sale to the highest bidder.
Redemption period – The time period that gives a distressed owner the right to redeem real estate after the foreclosure sale. Redemption typically requires that the owner pay the sales price, interest, and other costs. Not all states provide for redemption periods.
REO – Acronym for “real estate owned”. Reo is the status of the property when the foreclosure sale is not successful and when the ownership of the property is transferred involuntarily to the lender.
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Is it Recyclable?
Here is a little list that might make it easier to you to determine what you can recycle
Yes it is No it I not
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Newspaper Plastic or wax coated paper & cartons
Paper board Frozen food boxes
Cardboard corrugated boxes Microwave food boxes
Cardboard cereal & cracker boxes, etc. Wax cereal/crackers box liners
6 park cartons Books
Brown grocery bags gummed or glued bindings
Magazines Paper towels, napkins tissue paper
Glossy Paper Paper plates, soiled paper
Junk Mail Adhesive backed or sticky notes
Stationery & envelopes Carbon paper, thermal fax paper
Any high grade/uncoated paper Aluminum foil boxes
Binder/notebook paper, any color Fast food wrappers
Telephone books Pet food bags
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Be sure to check out my beautiful new custom home listing in Bel Air Crest at 2195
Pembridge Court for $5.3 million (the photos will be ready later this week) It is on a very
large lot (tennis court!!). I also have some wonderful listings coming up in Mountaingate in the next two to three weeks.
Take care and please have a Happy St. Patrick’s Day, and remember to wear green so that you don’t get pinched.
