The SchifferLine
Timely Real Estate News……………………1 December 2021

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US home sales rose in October…competition intense
Buyers continue to compete for a limited number of homes for sale across America, according to the National Association of Realtors (NAR). Existing-home sales increased 0.8% in October from the prior month to a seasonally adjusted annual rate of 6.34 million, the highest pace since January. Even though prices increased from September to October this year, sales fell 5.8% since last October 2020 when the market was at its peak for this cycle.

Low mortgage-interest rates have spurred a large wave of home-buying demand since the start of the Covid-19 pandemic. At the same time, the number of homes on the market has remained low, and new homes that are listed for sale are often snapped up quickly. As always it is truly a function of price… overpriced properties are sitting on the vine… even in a market like we are in.

Home sales typically decline after the summer. Many families do not want to move during the school year, and shoppers often stay home in cold weather and during the holiday season. High prices are also scaring off some buyers. The median existing-home price rose 13.1% in October from a year earlier, NAR said, to $353,900.

Even so, the market is on pace for its strongest sales in 15 years, said Lawrence Yun, NAR’s chief economist. “The housing market is remaining strong” due to continued low interest rates, a robust job market and rising stock-market values,” he said.

The frenzied housing market from earlier this year has somewhat plateaued. However, sales are still higher than pre-pandemic levels. Many buyers who have been sidelined by fast-rising prices are jumping back into the market if they see signs of a slowdown, economists and real-estate agents say.0
“The housing market is remaining strong” due to continued low interest rates, a robust job market and rising stock-market values,” Mr. Yun said.

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First-time buyers continue to struggle
It is no surprise in this inventory-challenged era that first-time buyers continue to struggle to compete with cash and non-primary residence buyers, according to the October 2021 Realtors Confidence Index report.

First-time buyers accounted for 29% of the existing-home buyers, a lower fraction compared to one year ago (28% in the prior month, 32% one year ago). The share of cash sales rose to 24% (23% in the prior month, 19% one year ago). The share of non-primary residence buyers (for rental and vacation/second home use) rose to 17% (13% in the prior month, 14% one year ago). Realtors reported that 23% of buyers waived the appraisal contingency clause (buyers who waived appraisal are likely cash buyers); and 21% waived the inspection contingency clause.

Among buyers who obtained a mortgage, the share who obtained FHA-insured mortgages decreased to 14% (15% in the prior month, 18% one year ago). Among first-time buyers, 72% put down less than 20% down payment, a lower share compared to one year ago (75% in the prior month, 76% one year ago). The report noted subdued market activity in October compared to one year ago and the prior month. The Realtors Buyer Traffic Index decreased further to 56 in October (57 in the prior month, 73 one year ago). Housing supply remains low, with the Realtors Seller Traffic Index registering at below 50 (“weak” seller traffic compared to one year ago).On average, sellers received nearly four offers (3.7) on their home sale (3.7 in the prior month, 3.4 one year ago). Respondents reported that on average, their buyer had made two prior unsuccessful offers on a home. Respondents reported that 42% of offers were above the list price, a lower fraction compared to 55% in June this year.

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Even with Zillow’s meltdown, iBuyer market surged
Before Zillow’s recent meltdown, national iBuyer market share surged to another all-time high, blowing past all previous records by a wide margin. In Q3 2021, iBuyers accounted for 1.6% of all homes purchased in the U.S. That’s around 28,000 homes, nearly double the 15,000 homes purchased by iBuyers in Q2.

The situation will certainly change with Zillow exiting the market and seasonality kicking in during Q4 2021. But for the time being, iBuyers have never been bigger, and Opendoor is now left as the undisputed category leader.

Also noteworthy: IBuyer Market share in Phoenix, the largest iBuyer market, peaked to a new high of 10.8%. This is the first time iBuyers have exceeded 10% market share in a major market — a significant, if temporary, achievement.

Both Opendoor and Zillow scaled their iBuying operations tremendously in Q3, but while Zillow’s business spectacularly imploded, Opendoor demonstrated critical economies of scale. As it grows, its net loss per home is improving.

What is this telling us? The great harm done by Zillow’s over-zealous approach to home evaluation caused enormous damage throughout the industry, especially for homeowners who falsely counted on equity in their home that simply wasn’t there. It is slowly healing now, but the trust between online data and actual home values has certainly taken a hit, a well-deserved one in my mind.

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“Let’s move closer to the kids…” A continuing trend
Parents, grandparents, friends — the desire to ‘stay close’ remains a major factor in why people are selling and moving these days. Among repeat home buyers and home sellers over the last year, a key factor for moving was the desire to live closer to family and friends, while an equally important motivator was the need for more space or a bigger home. Sellers as a whole were able to benefit in these transactions, typically earning their full asking price, and selling in one week.

These driving forces to move as well as further sales figures appear in the National Association of Realtors’ 2021 Profile of Home Buyers and Sellers, that analyses demographics, preferences and experiences of buyers and sellers across America. “During the pandemic, buyers and sellers have been driven by the desire to be close to family and friends, as well as the need for a larger home,” said Jessica Lautz, vice president of demographics and behavioral insights at NAR.

Among sellers, as a group they traded up in price, size and newer residences, as 46% purchased a larger home and 28% purchased the same size home.

Relocating to be closer to family had been increasing in recent years, according to Lautz, however, the COVID-19 outbreak accelerated that trend. And in past years, convenience to work and affordability had ranked as top factors for reasons to move.

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“Pouncing” is the new tactic in home buying
American home buyers are having to pounce faster than ever to clinch a deal, forcing many of them to make snap decisions about what house to purchase and how much to pay. I see it constantly — buyers are so afraid to miss a ‘deal’ or opportunity to purchase a home, they will bypass their own normal, conservative deliberations to ’snap up’ a home these days.

Home sales between July 2020 and June 2021 sat on the market for a median period of only one week before going under contract, according to a survey released last week by the National Association of Realtors. That is down from three weeks a year earlier and marks a record low in data going back to 1989.

The rapid turnover helps explain how the number of homes sold rose to multiyear highs during the Covid-19 pandemic, even as the inventory of homes for sale remained stubbornly low. The pandemic helped spark the biggest housing boom in more than a decade. Buyers that kept their jobs sought more space to work remotely and took advantage of low mortgage-interest rates. Many households also saved more during the pandemic and benefied from a rising stock market.

At the same time, supply has been constrained. Caution about showing homes during Covid-19, a reluctance among some owners to enter the competitive housing market and the ability to refinance at low rates kept many prospective sellers from listing their homes.

In such a fast-moving market, buyers have little time to commit to one of the biggest purchases of their lives and sometimes forego traditional safeguards. Many buyers have waived their rights to terminate a contract because of a low appraisal or unfavorable inspection to make their offers more competitive in a bidding war.

I caution my clients they are making an ‘investment of a lifetime’ and to be careful before making a final decision without carefully considering all of the ramifications of what that purchase will have on their lives for their future. I do understand the ‘panic’ that can set in with some clients — many of whom have been so frustrated in losing in bidding wars or simply not being able to find their dream home.

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Real estate investors aggressive in Q3
Investors continued to enter the market in droves during the third quarter of 2021, according to a report released last week. A record 18.2% of U.S. homes purchased during the quarter were snapped up by investors, up from 16.1% during the second quarter and from 11.2% the year before.

In total, investors bought 90,215 homes during Q3, an increase of 10.1% from Q2 and an increase of 80.2% year over year, marking the second-greatest annual gain ever recorded.

Risk of heat or storms haven’t deterred investors from purchasing homes in these high-risk areas. More than 65% of investor-purchased homes in the third quarter had a high heat risk, and about 64% had high storm risk. Just 27.1% of homes purchased faced high drought risk, 22.2% high flood risk and 3% high fire risk.

There seems to be no stopping investors who look at real estate as the single, most attractive investment, especially with the market suffering from the recent Covid variant from South Africa. Are we going back to the early pandemic days of 2020? Too early to tell, but real estate still remains high on every investor’s list.

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Surge in rental housing development continues
Home builders and other real estate companies are increasingly betting that would-be home buyers frustrated with a shortage of homes for sale and runaway prices will settle for renting their slice of the American dream.

Although individual homeowners and mom-and-pop investors still account for the vast majority of single-family rental homes, home builders have stepped up construction this year of new houses for rent.

In the third quarter, builders’ broke ground on 16,000 single-family homes slated to become rentals. That’s the highest quarterly total of housing starts for built-to-rent homes going back to at least 1990, according to an analysis of U.S. census data by the National Assn. of Home Builder

The trade association’s analysis includes only homes that builders are going to hang on to and rent out. That excludes homes being built to be sold to real estate investment trusts or investors planning to rent the properties.
Rents for U.S. single-family homes jumped 10.2% in September from a year earlier, according to real estate information company CoreLogic. The firm excludes apartments from its single-family home rental data, though it includes condominium and townhome rentals.

CoreLogic expects rents to continue climbing through at least the end of this year, citing strong demand, low supply of homes for rent and a strengthening job market.

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A Peak into my world
First a bit of personal sharing. As most of you may recall, my Mom passed away in June of 2020, and due to Covid my sister had not been able to come here until Sept of this year. Prior to that, she and our beloved caregiver/housekeeper for the last 40 years, over FaceTime went through EVERYTHING in Mom’s house and determined how things would be disbursed. It was an horrific job as Mom kept everything.. But they finally got through it and had items separated and packed up. Finally, this past Sept, my sister and brother-in-law were able to come here and have done so for the past 3 months, staying for two weeks at a time reviewing all of the boxes and making a detailed inventory of what was being sent to Canada and what is staying here.
That chore is in the final stages of being done, and now we are ready to sell the house to the buyers who have been waiting for us to get to this point.

Spending all of this time with my family has been wonderful, more than we have been able to do in years and created a wonderful relationship for us to grow. It will be sad to see the house go to new owners, as my sister and I both grew up in the house, but we know, that the new owners will be very happy raising their young family there.

As for work, I am busier than I have been in a long time. Buyers who are thrilled to have found a home to purchase and jumping through hoops to deal with multiple offers and prevailing. Sellers who are dealing with buyers and some of their at times unreasonable demands.

Currently I have one home in escrow where I am representing the Seller, and we have two back up offers, and on another where I am representing the Buyer there are two back up offers. The shortage of inventory is creating stress for all. We simply need more homes to sell. The buyers are definitely here. I have another buyer who is making an offer on a home in Santa Monica, and while we don’t know how many offers there will be when the sellers review the offers, I can only imagine there will be more than 10 as the open houses have been packed with potential buyers. I hope my client prevails as it is GREAT house and has her name all over it.

As we head into the strong holiday season, it is fun to show homes that are decked out in their holiday decorations. It creates such a warm and homey feeling and makes it easy for buyers in see themselves living there. Contrary to common thought, the holidays have not slowed the market down at all. My loan officer told me yesterday that he had 11 openings for loans yesterday after the Thanksgiving holiday weekend!!!!

The market is still very strong and hot! And mortgage rates are low, still!!!

Happy Hanukah ! Stay Healthy and Safe Travels!

The SchifferLine
Timely Real Estate News……………………15  November 2021

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Sales volume zooms upward 62%
Compared to a year ago, sales volume for 2020 is up 62%, which underscores the buying frenzy in today’s hotter-than-hot real estate market. Will it slow down? Perhaps, but it does not appear likely in our neck of the woods. We have made incredible strides in sales volumes for the five communities I report on — Beverly Hills, Beverly Hills Post Office, Bel-Air/Holmby Hills, Westwood/Century City, and Brentwood, which saw sales volume at $5.005 billion through October 2021 compared to $3.077 billion at the end of October 2020. That is just amazing to see these numbers continue to accelerate upward. There were some whopping sales prices which I will get into a little later.

What is notable is the nearly $2 billion increase over last year at this time reflects the strong attraction our homes and neighborhoods are getting from buyers everywhere. Multiple offers are still happening (I have been involved in two in the past week alone!) so, buyers beware — expect to stand in line, and be prepared before entering this market. What does it mean to be prepared? – have a pretty good idea of what you want to buy, where you want to live, and have most important pre-approval letter in hand, along with a great agent to get you where you want to go.

Beverly Hills led the pack with a $854 million sales volume increase over the previous year, which is almost $1 billion more….Brentwood was over $488 million, Bel-Air/Holmby Hills was up $230 million, Westwood/Century City — $212 million, and Beverly Hills Post Office up $175 million.

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Median sales prices increased in October, too
Not to be outdone, median sales prices are also showing greater signs of increases across all the communities I report on. Notably, all five communities’ median sales prices were significantly up this month compared to same time last year. Beverly Hills was best ever — $7.500 million median sales price for a single family residence or 16% for the year…BPHO was up 13% at $3.397 million, Bel-Air/Holmby Hills was up the best so far — 26% — to $2.331 million; Westwood/Century City was up 10% to $2.411 million, and Brentwood, was up 18% to $3.837 million.

These median sales price increases represent the largest leap in years as buyers are grabbing homes quickly. If homes are priced competitively, they’re going to move quickly, but while prices are up, we also saw last month a significant lag between original sales price vs. final sales price, with Beverly Hills showing 85% of its OSP vs it final selling price. BHPO was at 89%; Bel-Air/Holmby Hills was at 90% and Brentwood was at 95%. Only Westwood/Century was at 100% — a testament to this Westside powerhouse community. What this means is sellers are much more optimistic about what their homes are worth — off by as much as 15%. The house is worth exactly what someone is willing to pay for it and what the seller is willing to sell it for, and while there is a buying frenzy going on, buyers are not stupid. The do their research and in today’s data-driven world, which is no surprise. I know — I deal with very demanding, sophisticated buyers every day!

Pushing the sales #s was Beverly Hills, again, with 9 homes selling over $10 million, the largest was $63 million, and two in the $20+ million range. BHPO had one for $10 million and Bel-Air/Holmby had two over $10 million. But mostly, the
tremendous overall increases in pricing and sales volume were homes that were selling for under $10 mil

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Westside high-end sales are up…Way Up!
So, what is behind the continuing surging sales volume on Los Angeles’s Westside? This year marks the best ever in high end sales…the number of closed sales of $5 million-plus so far this year are 939, versus 569 at this time last year, up 90%. Of these, 313 were $10 million-plus this year and there were 165 $10 million-plus sales at this time last year, up 90%. 87 were $20 million-plus this year and there were 46 closed sales of $20 million-plus at this time last year, up 89%.

We are ahead in sales of $30 and $40 million-plus as well….Of the 87 sales of $20 million-plus, 28 were $30 million-plus, versus 13 at this time last year up a whopping 115%. Sixteen (16) were $40 million-plus and there were six currently last year, up 166%.

There are 128 pending sales of $5 million-plus now and 43 are $20 million-plus. Of the 87 sales of $20 million-plus, the buyers are mostly American — 71 or 82%. The other buyers are: 2 from Denmark, 2 Chinese, 1 S. African, 1 from India, 1 Saudi Arabian, 1 from England,1 Indonesian and 1 Canadian. The other six were not identified.

The areas of the sales are: 23 in Malibu, 22 in Beverly Hills, 8 each in Palisades and Bel Air, 6 each in BHPO, Brentwood, Holmby Hills and Sunset Strip and 1 each in Westwood and Santa Monica. Of the 87 sales of $20 million-plus, 34 were not listed at the time of sale or 39% unlisted. This is another “Wow” month for Westside sales.

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We saw it coming…Zillow closes home-flipping unit
Realtors and agents across the U.S. were not surprised to see Zillow pulling the plug on its tech-powered home-flipping operation after deciding that its pricing algorithms weren’t accurate enough to build a stable business. The company plans to take write-downs of as much as $569 million and reduce its workforce by 25% as it winds down the business in coming months as reported in the Wall Street Journal.

The decision comes as the company’s third-quarter results showed it lost more than $380 million in the flipping operation, called Zillow Offers. The business hit a major snag in recent months as the company’s algorithms caused it to overpay for houses just as the heated U.S. market began to cool slightly, forcing it to list properties at a loss.

As an experienced real estate agent for more many years on Los Angeles Westside, I have witnessed so many homeowners thinking they can get from 8% to 10% more than what the comps were showing and what was my professional estimate…”but Zillow says…” Well, that came a halt, finally, after the company’s ill-conceived home flipping suffered gigantic losses. Zillow estimates never had any traction with seasoned real estate professionals.

The company expects to buy roughly 9,000 homes in the fourth quarter and said it will take a write-down of as much as $265 million on home purchases that will close in the final three months of the year. The verdict is not in as to how Zillow is going to survive this. Many times, I have told the story, which I believe to be true that the owner of Zillow, based on their “Zestimate” bought his own home here in Brentwood and over paid because of the inaccuracy of the Zestimate. It has been very effective in getting my sellers to list their homes based on the comparable’ s I have presented them with.

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Higher home prices help those in ’trouble’
Trouble, we have trouble….or do we? The good news is that homeowners are keeping up with their mortgage payments or arranging for loan modifications with their service providers. But housing analysts say that while the real estate market still faces pandemic-related fears about a wave of delinquencies, higher home prices are helping to alleviate some of those concerns. The overall delinquency rate fell to the lowest level since the onset of the pandemic, CoreLogic, a real estate data firm, reports. “However, the decrease in delinquencies masks the serious financial challenges that a part of the borrower population has experienced,” Molly Boesel, economist at CoreLogic, writes for CoreLogic Insights.

“In the months prior to the pandemic, only one in five delinquent loans had missed six or more payments. In August 2021 one in two borrowers with missed payments were behind six or more months. Fortunately, large increases in home prices [have] given most borrowers a large home equity cushion, making foreclosure far less likely.”

The nation’s overall delinquency rate was 4% in August, which reflects homeowners in some stage of delinquency, considered to be 30 days or more past due on their mortgage payments, according to CoreLogic. That is a decrease of 2.6% from August 2020. Delinquencies, however, are still slightly above the early pre-pandemic rate in 2020 of 3.6%.
This is, indeed, good news. Still looming of course, is the eviction issue which has not gone away, at least in California. We shall s

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Will inflation have a negative impact on rates, sales?
As I have mentioned in previous SchifferLine editions, the Fed is expected to raise mortgage rates next year. The latest rise in inflation helps to explain why investors are increasingly asking not whether the Federal Reserve will raise interest rates next year but rather how much and how quickly it may do so.

The Labor Department reported Wednesday that consumer prices rose strongly in October, up 0.9% on a seasonally adjusted basis from the prior month. Over the last 12 months, inflation is up 6.2%. So-called core prices, which exclude food and energy items, rose 4.6% over the past year. Both are the largest annual increases in more than 30 years.

The figures highlight why Fed officials have been backing away from characterizing recent price pressures as “transitory.” Even though senior central bank leaders still believe inflation should slow as supply-chain kinks abate, they now see that process taking longer than they expected earlier this year, extending into 2022. That is in part because the spread of the Delta variant of the coronavirus has extended a series of disruptions in the economy.

Based on previous Fed rate increases, we can expect mortgage rates to increase, but with the latest rounds of data released by the Commerce Department, mortgage rates have actually gone down below 3% again. We did not see a bit hit when the Fed raised rates, so perhaps, we won’t again. But do not bet on it. I recommend if you are looking for financing, do it now.

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Renters who left town, come back to “sticker shock”
So much for waiting for the dust to settle. While many think they see the light at the end of the pandemic tunnel and return from their rural adventure, they are shocked to see how rental prices have move upward, to many, out of reach.

According to the Wall Street Journal, it turns out you cannot go home again. At least, that is the case for many of the Americans who left their homes in major metropolitan areas during the pandemic, relocating to the countryside for more living space and access to nature.

Now they are returning in droves as vaccines become more widespread, employers call their workers back to the office and schools reopen for in-person instruction. They are arriving to find bidding wars and skyrocketing prices in their former neighborhoods, where everyone now wants the same things: outdoor space, a home office, and move-in readiness. In Los Angeles, rents have increased 10.4% over the past year. Only a handful of large cities, such as San Francisco and Minneapolis, still have rents discounted from pre-pandemic levels.

Welcome home

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Brentwood — one of America’s favorite places to live
Brentwood, 90049, is nestled in the foothills of the Santa Monica Mountains. Some of the homes have commanding
views of the city, stretching from Beverly Hills to Malibu and the Pacific Ocean. Home to many celebrities in entertainment, media and the corporate world, Brentwood is adjacent to thriving Santa Monica and Pacific Palisades to the West and Westwood and Century City to the East.

Noted for its small-town, country-like atmosphere, Brentwood features a wonderful neighborhood of shops, fine restaurants, and an active lifestyle of sports enthusiasts who jog up and down beautiful San Vicente Boulevard in the meridian to nearby Santa Monica Beach.

What makes the various Brentwood neighborhoods so charming are its tree-lined streets and magnificent homes. Many streets, for example, do not have sidewalks. There truly is a country feeling, a sophisticated casualness about the community. But Brentwood residents are full of pride and very protective of their community and lifestyle.
The community’s larger homes and estates are usually found north of San Vicente or world famous Sunset Boulevard along streets that meander up to the foothills and through the canyons of the Santa Monica Mountains. Upscale apartments populate the area south of San Vicente, intermingled with shops and restaurants.

Brentwood is also home to several, highly rated private schools – The Brentwood School and Archer School for Girls, two the most prestigious schools in California, plus the community features one of the finest public education systems within the city.

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How am I doing you say?
Life is busy and interesting! My sister & brother-in-law have been here two weeks, two weeks off working in Mom’s house getting it ready to sell. They have done a tremendous and enormous job. We are almost there and have 3 or 4 potential buyers we are working with. Having them stay with me has been great and fun, and I really miss them when they are back home.

Work has been keeping me hopping and “the busy holiday season” has not made a dent in my working seven days a week, nonstop. I love it but am also looking forward to taking a little time off and taking a breath or two. As you may recall, I am a mentor to new licenses, and one of them has an offer on his first listing. It is such a joy to me to see the excitement and zest for learning and accomplishment in putting a transaction together. Unfortunately, I do not think this offer will come together, but working with him and guiding him to widen his horizons is for me what this is all about. It is the same as meeting someone new who comes to me as a buyer or seller and adding more dimension to my life.

I have one listing in Mountaingate that we thought we had sold, but unfortunately it just fell out of escrow, again, (which is a common occurrence today), however we put it back into escrow two days later, and I hope it sticks this time. I am as always looking to find properties to fill my large pool of buyer’s needs, so again, I you are at all thinking of selling, please do contact me.. Carole Schiffer – 310 442-1384

I hope you have a wonderful and restful Thanksgiving with your family and friends. Would love to hear how you celebrated the holiday with it being the first time in a long time that we can be with family and friends again.

Take care – stay safe and ENJOY!!!

 

The SchifferLine
Timely Real Estate News……………………1 November 2021

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Home price growth sets records
It is no surprise that home prices are continuing their upward march, setting records every month. August was no exception. According to Case-Shiller, which produces the leading home price index for the industry, reported its index rose 19.8% as demand remains robust despite rising prices pushing some buyers out of the market as demand from home buyers remained robust despite skyrocketing prices.

Demand to buy homes has surged since the start of the Covid-19 pandemic as households looked for more space to work from home and some workers were willing to move farther away to purchase their home.

The number of homes on the market has held well below historic levels, forcing buyers to compete in bidding wars and pushing up home prices. The Case-Shiller index, which measures repeat-sales data, reports on a two-month delay.

In more recent weeks, the pace of home-priced gains has slowed a little, the same axiom holds true, properties that are positioned well, meaning well priced and in good showing condition are still selling very quickly, and those properties that are not are ’lingering on the vine” . The median existing-home sales price in September rose 13.3% from a year earlier to $352,800, the National Association of Realtors said earlier this month.

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Mortgage rate increases surging, too
Mortgage rates have increased in recent weeks, which could slow home-price gains further by raising monthly payments for home buyers. The average rate on a 30-year fixed-rate mortgage rose to 3.09% as of last week — which is still low — according to mortgage-finance giant Freddie Mac. As I mentioned previously the new confirming rate for Freddie is $937,500 is now in effect, which will make it significantly easier to get a loan.

Mortgage rates have been on a tear this past month, rising yet again last week to the highest level in eight months. That caused mixed demand for mortgages last week, resulting in no change from the week before. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.30% from 3.23%, with points decreasing to 0.34 from 0.35 (including the origination fee) for loans with a 20% down payment. That rate was thirty basis points lower one year ago.

As a result, refinance demand fell 2% week to week, seasonally adjusted. Volume was 26% lower than the same week one year ago. The refinance share of mortgage activity decreased to 62.2% of total applications from 63.3% the previous week.

I anticipate rates are going to climb further and the Fed has indicated that a rate hike is most likely in 2022, so if you are thinking of moving, now is the time to look at options with rate rises on the horizon.

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Home sales rebound in September
Existing-home sales rebounded in September after seeing sales wane the previous month, according to the National Association of Realtors. Each of the four major U.S. regions witnessed increases on a month-over-month basis. From a year-over-year timeframe, one region held steady while the three others each reported a decline in sales

Total existing-home sales completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 7.0% from August to a seasonally adjusted annual rate of 6.29 million in September. However, sales decreased 2.3% from a year ago (6.44 million in September 2020).

“Some improvement in supply during prior months helped nudge up sales in September,” said Lawrence Yun, NAR’s chief economist. “Housing demand remains strong as buyers likely want to secure a home before mortgage rates increase even further next year.”

Total housing inventory at the end of September amounted to 1.27 million units, down 0.8% from August and down 13.0% from one year ago (1.46 million). Unsold inventory sits at a 2.4-month supply at the present sales pace, down 7.7% from August and down from 2.7 months in September 2020.

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Bel-Air Park — above it all…
Where can one get away from it all, especially in metropolitan Los Angeles? Well, there is one place – you can just about reach out and touch it. It is one of LA’s best-kept secrets – Bel-Air Park. It is in my opinion, one of the most under valued communities in West Los Angeles.

Located in the realm of Sepulveda Pass and sitting atop a beautiful mountain crest overlooking the Getty Museum, Bel-Air Park (sometimes referred to as Upper Casiano) is a guarded community that features 145 single-family homes on wide streets.

Bel-Air Park is situated just off world-famous Mulholland Drive, where many of the homes feature large lots, some with magnificent views. Bel Air Park is adjacent to the world renown American University of Judaism and Stephen S. Wise Synagogue, and school and is a neighborly “community” unto itself.

I have been serving this wonderful ‘hideaway’ community for the past 25 years…and as properties rarely come up for
sale, this is a place ‘worth the wait.’ Please call me for more information on Bel-Air Park — call Carole at 310-442-1384.

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It’s a bird. It’s a plane. No, it’s rain!
Surprise, surprise, surprise. Gomer was right — rain finally made an appearance in Los Angeles, but it was our northern neighbors who got most of this ‘cyclone bomb’ (some called it), partially quenching California’s out-sized need for water.The atmospheric river which arrived on Monday, October 25, delivered huge amounts of precipitation in Northern California, including an all-time record in Sacramento, which saw more than 5 inches of rain.

But the totals were far lower in the Southland’s Los Angeles International Airport on Monday recorded 0.39 inches, which was a daily record but still a far cry from areas like Placer County’s Blue Canyon, which received more than 10 inches in the storm.

“Southern California always is a little bit different,” said Scott Stephens, a professor of fire science at UC Berkeley. “It’s nice that the rain did happen down there too, but Santa Ana winds and other events can dry things so quickly that I don’t think we could say this ends our problems here in Southern California. I do think potentially in Northern California we can.”

But there are warning signs: Drought-dried vegetation was a major element in this year’s fire season, enabling blazes like the Dixie Fire to move so aggressively. Some fuels will actually lose water at the samerate that they actually gain it. On a really dry, warm day, the fine fuels can be incredibly changed according to Stephens.

Were a warm Santa Ana wind event to move into the region, it would essentially act like a blow dryer for the moistened landscape, drying it out again and priming it for further ignition, he added. So please be careful — and follow the guidelines established by the LA City Fire Department for clearing brush from your yard and prepare for the always-present fire season.

My sister & brother who are visiting here again, are telling me that they received five inches of rain in Vancouver in 1 day. Their soil is better suited to absorb that kind of rain then ours which is more clay than actual dirt. The Northwest has suffered from the same drought we have had and have lost a lot of trees. One of the things I have always loved when I visit them is to see all of the magnificent trees. Hopefully by the time I go there next time, some of the damage will have refurbished itself.

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A paradigm shift to a ‘remote culture’?
The exodus started on March 11, 2020, when the World Health Organization officially announced we are in a global pandemic. We are still in it, and this has transformed most of the world as we see it today — workers remain remote, and many of them want to keep it that way. Are we creating a Remote Culture that will permanently change cities and the way we work forever?

One only has to read the appeals from small, Midwestern cities, many of which have lost population to more urban areas, are now aggressively marketing for remote workers to relocate, offering $10,000 to plunk down your laptop in their town. And it is working. Workers appear to stay put at home, some quitting their jobs in record numbers to avoid going back to the daily 9-5 grind and hour commutes. According to PwC, 41% of workers want to stay remote as of August, up from 29% in January.

This has resulted in owners of tall office buildings, for example, to begin addressing their workspace environments. They are realizing it may take a lot of convincing to get workers to leave their comfortable home offices to come back to the office increasingly taking on remodels to attract employees back, adding amenities such as outdoor terraces, private gyms, green spaces, lounge areas, and flexible conference centers.

On the other end, workers are now redesigning their homes and backyards — creating luxurious outdoor living areas with expensive, premium BBQ grills, pizza ovens, new patio furniture and fire pits. Is this going to be a permeant result of the pandemic? It is certainly trending that way.

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My Work a Day World

As you all know by now, I have a very busy Real Estate career, and it keeps me hopping and I Love it. Every day brings something and someone new – it keeps the juices flowing and I would not want it any other way .

At the moment, all my listings are in escrow, and I have tons of buyers with no place to put them! Please help me out! Here are a few of the buyers I am working with: – I have a couple who have two children and three grandchildren, some living in Culver City, and the others in Encino. The grandparents live in New York and need a home “in the middle’ for when they visit. I have another client who needs a three -4-bedroom home for herself, her “special needs” child and their caregiver. Another buyer I have has two friends, and the three of them want to purchase three different properties near one another in the Pacific Palisades, Westwood/Century City areas – 3 bedrooms.

One of the questions I get asked all the time, is this a good time to put my house on the market, and the answer is YES!! Not only do we get the “real buyers” who want to buy a house, perhaps to even spend the holidays in, but with the holiday decorations in most houses, it creates a warm, homey feeling and makes it easier for a potential buyer to picture themselves in the house. SO, if you are thinking of selling your house, please reach out to me…. Carole Schiffer, 310 442-1384

I am very much looking forward to Halloween this weekend and to see the kids and their parents out trick or treating again. Some of the decorations are amazing. I saw one last night on my way to Marina del Rey, which is well worth the drive. It is a house on Barrington, about a block south of Palms Blvd, on the West side of the street. You can’t mis it as there are crowds standing in front taking pictures. Really a lot of fun!

Please do reach out to me with any and all your real estate needs

Happy Halloween… .. Stay safe and careful!

 

 

 

 

 

 

The SchifferLine
Timely Real Estate News……………………15 October 2021

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Sales volumes continue upward push
Buyers are thirsty, and they are quenching their lusty thirst by spending millions on homes on the Westside as sales volumes continue their rapid rise each month in the five communities I report on — Beverly Hills, Beverly Hills Post Office, Bel-Air/Holmby Hills, Westwood/Century City and Brentwood. Sales volume increased over 64% to a record $4.492 billion through the first nine months of 2021, which compares to $2.740 billion a year ago. Of course, the law of inventory supply and buyer demand come clashing together each day in our market, as buyers are scrambling to capture their dream home, often fighting through a line of other home seekers, eager to kick up their offers to close the deal. It has been mostly a civil process as many buyers walk away, hopelessly disappointed as for many, this is not their first loss….but they keep looking.

Sales volume leaders were Beverly Hills with an increase of $626 million over comparable sales for 2020. Brentwood was up over $506 million through the first nine months of this year…Westwood/Century City was up $208 million, Bel-Air/Holmby Hills was up $201 million, and BPHO was up $195 million through September compared to 2020.
Particularly notable was the dramatic increase in sales volume in Pacific Palisades — another area on which I focus — where they experienced an increase of $754 million in total sales through the first nine months of this year compared to 2021.

None of this comes as a surprise since we have witnessed these enormous increases in sales volumes since the first of the year — a year fraught with the ongoing Pandemic that continues to plague many parts of our economy.

A worthy footnote — There were a number of large sales in all the areas I specialize in – Beverly Hills – 6 homes between the $6,000,000 – $17.000,000; Beverly Hills Post Office — 4 homes between $6,800,000 – $16,000,000: Bel Air — 4 between $4,000,000 – $$9,500,000: Brentwood — 6 between $7,000,000 – $23,900,000; and Westwood , 4 homes between $4,000,000 and $8,200,000. As a reminder these are only sales that were recorded in the multiple listing service and does not take into account any private sales. However, you look at these numbers it certainly skews the stats for both sales volume and median sale prices!

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Median sales prices are not sitting on silently by
For the most part of 2021, we have been experiencing moderate median price increases — in the 4-6% range for most of the communities I report on monthly. But September was a break-out month for MSP, all but one in double-digit increases.

Beverly Hills’s median sales price was up 18% through the month of September at $7.424 million; Beverly Hills Post Office was up 12% at $2.297 million; Bel-Air-Holmby Hills was up 24% at $2.900 million; Westwood/Century City came in at $2.648 million, up 8% and Brentwood rose to 16% at $3.700 million. Pacific Palisades was up to $4,037 million, up 21% for the year.

All in all, median sales prices remain the primary barometer of how our market is doing. We continue to experience tremendous MSP growth since the mid-point of the pandemic, which one would think the opposite would happen. It did not. And we can expect to see the same price growth through the end of the year, even though the Fed signaled it might re-instate higher rates in 2022, but let us not forget, inflation is raining down on us now…up 5.6% this past September, meaning inflation will also affect home pricing, like everything else. We have seen a rise in median prices in various communities more so than in others. For example, in Bel Air Crest we had two homes that sold within days of coming on the market for $400,000 more than their listing prices. This practice is somewhat unprecedented in the community for the past 25 years that I have been living here. This happened in the portion of the community with the smaller (Canyon Homes), not so much in the portion of the community with the larger Custom-built homes.

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Jumbo mortgages surge as prices rise
It is no surprise mortgage lenders are reading the same data you see here and elsewhere: The projection for the cap of a conforming Freddy Mac and Fannie Mae loan interest rates that is currently $548,250, will possibly go to $900,000. After the conforming loan amount the loan category would be a jumbo loan which traditionally has brought higher interest rates. However, currently this is slightly different in that the rate for jumbo loans is slightly lower than a conforming loan. Please contact me and I will be more than happy to share the information with you…Carole Schiffer…310-442-1384.

Mortgage loans that exceed conforming loan limits set by Freddie Mac and Fannie Mae are estimated to reach $550 billion this year Bank of America estimates. A large share of that has been held in bank portfolios, but more is being securitized or sold to investors as private mortgage-bond deals, MarketWatch reports.

Home prices have increased by 20% compared to a year ago. Home buyers are stretching their budgets to try to afford the higher prices. The average mortgage amount averaged $410,000 the last week of September, according to data from the Mortgage Bankers Association. That marks the highest average mortgage amount since May.

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Pending home sales rebound….
Pending home sales rebounded in August, recording significant gains after two prior months of declines, according to the National Association of Realtors. Each of the four major U.S. regions mounted month-over-month growth in contract activity.

However, those same territories reported decreases in transactions year-over-year, with the Northeast having the highest impact, enduring a double-digit drop.

The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, increased 8.1% to 119.5 in August. Year-over-year, signings dipped 8.3%. An index of one hundred is equal to the level of contract activity in 2001.

“Rising inventory and moderating price conditions are bringing buyers back to the market,” said Lawrence Yun, NAR’s chief economist. “Affordability, however, remains challenging as home price gains are roughly three times wage growth.” Such an imbalance in the market is unsustainable over the long-term, according to Yun.

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High-end sales continue hot streak….
It just gets better and better, and more interesting. There have been 858 closed sales of $5 million-plus so far this year, versus 489 at this time last year — up 75%. Of these, 280 were $10 million-plus this year and there were 151 $10 million-plus sales at this time last year — up 85%.

We are seeing some sale numbers that appear to be in the stratosphere and there is no end in sight.

Seventy-six (76) were $20 million-plus this year and there were forty-four closed sales of $20 million-plus at this time last year, an increase of 73%. Twenty-six (26) of these sales were $30 million-plus this year, versus thirteen at this time last year, up 100%…and fourteen, were $40 million-plus this year and there were only six at this time last year, up 133%.

What is continuing good news is there are 119 pending sales of $5 million-plus at the moment and fifty-two of these are $20 million-plus, three are $30 million-plus and two are $40 million-plus.

Of the seventy-six sales of $20 million-plus, the buyers are mostly American — 57 or 75%. The other buyers are two Chinese, two Danish, and one Canadian, one Indonesian, one Saudi, one Canadian and one South African and twenty were in Malibu, 15 in Beverly Hills, eight in the Palisades, seven in Bel-Air, six each in Sunset Strip, Bel-Air/Holmby Hills, BHPO and Brentwood.

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UCLA Anderson Forecast — sizzle to ho-hum
I remember reading that the Covid-19 virus would probably be short-lived, and by Summer, if not Fall, it would all be behind us. That was 2020. And UCLA forecasters took note of the initial optimism in early 2021 that our economic recovery was going to be like the “Roaring ‘20s”….then they moderated their vision — “euphoric”, then to “boom time”, and now? “Ho-hum”. The Delta variant continues to take its toll on us, the economy and on forecasters’ predictions.

With the entrenched vaccine resistance and rising deaths in many states, consumers are hesitant to go out and spend on entertainment and restaurants, workers are retiring rather than risk infection on the job, business and international travel are dormant and global supply chains are going haywire as the virus closes factories abroad.

UCLA predicts gross domestic product will grow this year at 5.6%, down from the 7.1% rate forecast in June. It expects the economy to expand by 4.1% next year, down from the 5% anticipated earlier.
As consumption and investment shift into the future, 2023 growth could be 3.1%, up from the previously forecast 2.2%.

Not until the third quarter of 2023 would GDP reach its pre-COVID-19 trend, according to the new calculations. UCLAs Anderson School releases its economic forecast every quarter…let’s see what comes next??

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Floods? Not here in Southern California, right?
It was reported this week in the LA Times that summer 2021 is the driest we have had since 1895. It does not ever rain here — we are all beginning to feel that way (and, no, a drizzle is not rain).

But here is some sobering news: About 25% of all critical infrastructure, or about 36,000 facilities, in the country is at risk of becoming inoperable due to flood risks, according to a new report from the First Street Foundation, the creators of Flood Factor, a nationwide flood risk tool.

About 23% of all road segments, or nearly two million miles of road, are at risk of becoming impassable. Further, 20% of all commercial properties, or about 919,000–and 14% of residential properties, 12.4 million—also are at risk.

Our canyons, some denuded by recent fires, will also pose a threat to flooding — just ask Montecito residents about the disastrous 2018 flood that killed twenty-three residents caught in cascading floodwaters and mud.

Please check your insurance policy for flood (and fire) insurance. Do not assume your homeowner’s policy automatically covers flood damage.

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My world and welcome to it.
First of all, the best news, after not seeing one another nor being together since Feb ‘2020, my sister & brother-in-law were here for 2 weeks and will be back this coming week for another 2 weeks to work on cleaning out our mom’s house and getting it ready to put on the market. It was wonderful seeing and being with them. They stayed with me, and it was great catching up with one another. Depending on how much gets done on this next trip, there will be another trip in November, perhaps, even for American Thanksgiving (they celebrated Canadian Thanksgiving this past Monday!). Now that the borders between the US and Canada are open again, I will be celebrating Christmas with them in Canada!!!

In the meantime, my work has been keeping me busy. Hopefully, sometime soon you will have the opportunity to meet my assistant, Miguel, who I call Mr. M. He has been of great assistance to me in handling my business. My lovely listing in Bel Air Park sold after being on the market for a little less than 3 weeks, and my last listing in Bel Air Crest, leased in 13 days for over asking! I also am working with about 10-15 buyers all of whom are looking to purchase homes in the Bel Air Crest, Mountaingate and or Beverly Ridge areas, with the lack of inventory we are all dealing with, I am searching for properties to put them into…SOOOOOO if you ate at all considering selling your home in any of these areas, or any other for that matter, please contact me…Carole Schiffer, 310-442-1384.

I know we are all looking forward to a fun-filled Halloween and have decorated our homes for this fun event. If you want to share your photos, please send them to me…
ceschiffer@gmail.com , and I will post them.

HAPPY HALLOWEEN – STAY SAFE