The SchifferLine
Timely Real Estate News……………………1 September 2021
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U.S. Supreme Court ends eviction moratorium for most states
The Supreme Court ended the Centers for Disease Control and Prevention (CDC’s) eviction moratorium last Thursday, giving much-needed relief to America’s small housing providers facing financial hardship for more than a year.
In a 6-3 ruling, a majority of justices agreed that the stay on the lower court’s order finding the CDC’s eviction moratorium to be unlawful and was no longer justified.
In their order, the justices wrote, “The moratorium has put the applicants, along with millions of landlords across the country, at risk of irreparable harm by depriving them of rent payments with no guarantee of eventual recovery”.
Despite the CDC’s determination that landlords should bear a significant financial cost of the pandemic, many landlords have modest means.” The case was brought by the Georgia and Alabama Associations of Realtors and other property providers.
The National Association of Realtors (NAR) stated that no housing provider wants to evict a tenant—it is always a last resort and reserved for the rarest cases. The NAR added that the best solution for all parties is rental assistance, and all energy should go toward its swift distribution of nearly $50 billion of aid that is now available to cover up to a year-and-a-half of combined back and future rent and utilities for struggling tenants—and every state has started a program to distribute the funds. It will be up to Congress to determine how this might be dealt with legislatively.
Many states and localities, including New York and California, have extended their own moratoriums, providing another layer of protection for some renters. In some places, judges, aware of the potential for large numbers of people to be put out on the street even as the pandemic intensifies again, have said they would slow-walk cases and make greater use of eviction diversion programs.
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Median sales prices increase across the country
Continued low levels of housing inventory, combined with record-low mortgage rates spurring housing demand, have caused an increase in median sales prices for existing single-family homes in all but one of 183 measured markets during the second quarter of 2021. That is according to the NAR’s latest national report, which reveals that 94% of 183 metro areas also experienced double-digit price increases (89% in the first quarter of 2021).
The median sales price of single-family existing homes rose 22.9% to $357,900, an increase of $66,800 from one year ago. All regions saw double-digit year-over-year price growth, which was led by the Northeast (21.8%), followed by the South (21.0%), West (20.9%), and Midwest (17.1%).
“Home price gains and the accompanying housing wealth accumulation have been spectacular over the past year, but are unlikely to be repeated in 2022,” said Lawrence Yun, NAR chief economist. “Housing affordability for first-time buyers is weakening,” Yun explained. “Unfortunately, the benefits of historically-low interest rates are overwhelmed by home prices rising too fast, thereby requiring a higher income in order to become a homeowner.”
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Homeowners love to see rising prices…. how about rising taxes?
Skyrocketing home prices over the last year may soon hit current homeowners in the form of property taxes. Housing experts are predicting property taxes to climb higher in 2021 than the 4% uptick in 2020.
Many city governments lost revenue during the COVID-19 pandemic and, as reassessments kick in, homeowners may be faced with a soaring bill. Property taxes are expected to increase by about 6.5% in 2021, according to realAppeal, a company that helps homeowners appeal property tax bills.
“Many of our clients who are older and living off of Social Security or pensions are beginning to wonder whether or not they’ll be able to remain in their homes as their property tax bills continue to rise,” Frank DiZenzo, chief revenue officer of real Appeal stated.
The 2020 housing boom may “take a couple years to fully translate into dramatically higher property tax bills because counties usually reassess property values every few years, often three-year intervals,” Brian Davis of Spark Rental, which provides software for housing providers, stated. About 34 states restrict how much taxes
About 34 states restrict how much taxes can increase in a single year too, providing some level of protection to homeowners. For example, California limits that assessed home values cannot grow more than 2% in a year until the home is sold. Forty-six states, as well as Washington, D.C., also offer some sort of homestead exemption, which can lower taxes for homeowners who use the home as a permanent residence
Here in Los Angeles, we should be receiving our property tax bills shortly. As a reminder, they are due by November 10th, delinquent on December 10th, and the second portion is due February 10th, and delinquent on April 10 ‘2022. Easy to remember – “No Darn Fooling Around”
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Mortgage rates move down…demand light
As demand lessened, mortgage rates moved down after rising for three weeks. But it didn’t seem to have much effect on mortgage demand. Total application volume rose 1.6% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.03% from 3.06%, with points falling to 0.29 from 0.34 (including the origination fee) for loans with a 20% down payment.
“Treasury yields fell last week, as investors continue to anxiously monitor if the rise in COVID-19 cases in several states starts to dampen economic activity. Mortgage rates slightly declined as a result,” said economist Joel Kan..
Applications to refinance a home loan, which are highly rate sensitive, moved just 1% higher for the week and were 3% higher than the same week one year ago. The problem is that so many borrowers already refinanced at even lower rates last fall.
Applications for a loan to purchase a home increased 3% for the week but were 16% lower than the same week one year ago. Homebuyers are hitting an affordability wall, and the supply of homes for sale, while increasing slightly, is still far too low.
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Home sales rose for second consecutive month
According to the National Association of Realtors, existing-home sales rose in July, marking two consecutive months of increases. Three of the four major U.S. regions recorded modest month-over-month gains, and the fourth remained level. Figures varied from a year-over-year perspective as two regions saw gains, one witnessed a decline and one was unchanged.
Existing-home sales in the West grew 3.3%, posting an annual rate of $1,240,000 in July, equal to the level of a year ago. The median price in the West was $508,300, up 12.5% from July 2020.
Total existing-home sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, grew 2.0% from June to a seasonally adjusted annual rate of 5.99 million in July. Sales inched up year-over-year, increasing 1.5% from a year ago (5.90 million in July 2020).
“We see inventory beginning to tick up, which will lessen the intensity of multiple offers,” said Lawrence Yun, NAR’s chief economist. “Much of the home sales growth is still occurring in the upper-end markets, while the mid- to lower-tier areas aren’t seeing as much growth because there are still too few starter homes available.”
This is good news — we have been used to seeing home prices rise steadily on the Westside, but seeing the rise in actual home sales is encouraging. I have been consistently busy since the first of the year — buyers are out there scrambling for ‘deals’ — and there are some, but rare. Buyers are smarter these days — they do their research.
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Electric car-charging stations give garage powerful upgrade
It was bound to happen. With EVs becoming more and more popular, the need for recharging at home also became not only more popular, but a necessity. So, American ingenuity takes over, of course. So, what’s your EV plan?
The obvious place to charge your EV is the garage, but it takes some investigation and getting some sound advice as to how you install your charging station inside your garage. For example, in North America, all electric cars can be charged using a standard J1772 plug, sometimes called a “J” plug, said Tom Moloughney, an electric-vehicle industry consultant. Here is where it gets technical:
Tesla’s can be charged using a J plug but they need an adapter, which comes free with the vehicle. The amount of power a car gets during charging, measured in kilowatts, is a product of the outlet’s amperage, or the volume of electrons present, multiplied by voltage, which is the pressure of the electrical current, Moloughney explained. Standard household outlets are 120 volts with 15 or 20 amps, which is known as Level 1 charging, according to Moloughney. That translates to 3 to 5 miles of range per hour of charging, he said.
Montgomery noted that every electric vehicle can accept different levels of power, so you need to match the charger to what your car can accept. A car that charges at 80 amps on a 240-volt circuit can take 19.2 kilowatts an hour, he said. That translates to 50 to 60 miles of range per hour, roughly 10 to 20 times as fast as a Level 1 charging setup.
While it is common for homeowners to upgrade to 240-volt outlets, wall-mounted charging stations deliver a more powerful and faster charge. The cost of upgrading is typically several thousand dollars, including labor and a few hundred dollars for the charging station itself. But as we know, these EVs now is ‘part of the family’ and nothing is too good for your electric vehicle.
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Mountaingate — one of Southern California’s premier resort communities
Thousands of Sepulveda Pass commuters drive by Mountaingate every day. Located atop the serene, beautiful Santa Monica mountains, offering breath-taking views of the city, canyons and ocean and golf course, Mountaingate is one of Southern California best kept secrets, as residents like to tell everyone. And it is.
The first phase in the Mountaingate development was the Country Club and golf courses, built in 1970. The residential portion of the community slowly developed over the next two decades, and today is made up of town houses and single family homes. The entire community was developed as a condominium. The first homes, which are townhouse/condominiums, and the ones you see from the freeway were constructed in 1979.
What makes Mountaingate so special is, of course, its location. It like its neighboring community of Bel Air Crest, offer the best of both worlds… away from it all, yet minutes to either the Westside or the San Fernando Valley. One has to drive to the top of the mountain where the residential areas are located. The development features five-communities-in-one for a total of 307 residences — single-family dwellings and town homes/condominiums. There are three townhouse communities – The Vista, The Terrace, and The Ridge, and the remainder are single-family homes some of which are attached and others that are completely free standing. In addition, there is a small gated street with four homes.
With the exception of the street with only four homes on it, each community enjoys their own private community pool, and one street also offers tennis counts. Security is tight — most of the Mountaingate community is served by 24-hour guard-gated security force, buttressed by guard patrols throughout all the neighborhoods 24/7.
What certainly underpins the community’s resort atmosphere is, of course, is the private Mountaingate Country Club, which features two magnificent golf courses that weave their way through the canyons and arroyos of the property and is regarded as one of the top golf experiences in Los Angeles. The Club’s membership is separate from the residential communities, but many residents are members of the Club. Indeed, Mountaingate is a great place to call home! Please call or email me to assist you in finding your home there.
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What are some of the changes taking place?
As I am sure you know, many insurance companies have pulled out of the state in offering homeowners and fire insurance, look at the horrible fires currently going on in Northern California and Southern California. The loss of their coverage has wreaked havoc with many homeowners, causing them to pay increased premiums, sometimes with subpar companies and policies and/or self-insuring which can create problems also. All of this has not gone un-noticed by the members of the California legislature and I understand there is movement afoot to try and amend and/or correct the situation. This is not going to go away in a day, but hopefully there will be a solution that can make it better for all of us.
That being said, with the drought we are living with and will continue to experience, we are being strongly encouraged to be water-safe and aware, and to try to cut down the amount of water we use on a daily basis. Not sure if you have seen some of the media attention being given to those who are now showering every other day rather than daily – hope they have a good supply of deodorant! I know for myself; I have prepared to have the grass in my lovely garden turn brown as I cut back on the amount of watering.
In the meantime, my business continues to perk along with buyers looking to find their dream home and sellers ready to move on and effect changes in their lives. Currently, I have 2 townhouse homes in the Ridge community of Mountaingate (one is coming on the market in the next week or so). Both are 2 bedrooms/2.5 baths, plus a den. I also have a lovely 3/2.5 home available for lease in Bel Air Crest which is also coming on the market right after Labor Day. My other property is in the lovely community of Bel Air Park. It is a 5 bedroom/4.5 bath home with a HUGE back yard with room for a pool, and then some! It too is coming on the market right after Labor Day
Please get in touch with me for information about all of these wonderful properties and to make an appointment and/or to possibly add to the inventory of properties on the market and sell your home.
Carole Schiffer – 310 442-1384 ceschiffer@gmail.com carole@caroleschiffer.com
Please take care of yourself, wear those masks we have all come to hate wearing and if you haven’t already done so, please get that vaccine – not only is it good for you, but for the rest of us also!
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