Timely Real Estate News………………………………………………15 August 2012
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Solvang started out quaint…..still is. Danes preserve their heritage
If you were one of the many Danes who left Denmark for the United States between the 1850s and1930s, when Europe was facing difficult economic times, you probably ended up somewhere in Minnesota, Illinois, Iowa, Nebraska or South Dakota — owning a farm, bakery or a restaurant. But if you were tired of the Midwestern winters — like many were, you headed west and ended up in California where Danish pioneers before you had settled on 9,000 lush acres on what was formerly part of the Spanish land grant of Rancho San Carlos de Jonata. Founded in 1911, Solvang’s Danish beginnings have survived largely intact — the town’s architecture, religious history and church buildings, and its annual celebration of Danish Days, which has been going on since 1936 and are held the third weekend in September, are pleasant reminders of a far-off land and culture that attract more than 1 million visitors to this quaint village just north of Santa Barbara off Highway 101.
Solvang is actually quite famous, still, in Denmark. Since 1939, Danish royalty has visited Solvang on a variety of occasions to commemorate its linkage and connection to the home country, and tourists love to pose with the statues of the Little Mermaid (found in the harbor in Copenhagen) and Hans Christian Anderson. A replica of a 19th-century Danish streetcar, the horse-drawn “Henen”, rambles down Solvang’s main thoroughfare and takes visitors on sightseeing tours. And of course, it didn’t hurt when the Academy Award nominated movie, Sideways, was filmed in part in Solvang, which brought attention to the many charms of the village today.
There is more to Solvang than Solvang — there are wonderful wineries in the Santa Ynez valley, where some of the best California wines are produced. The Chumash Indian tribe created the Chumash Casino Resort which is just five miles east of Solvang and attracts nearly 3 million visitors a year. Also, Solvang is a popular stop on the Tour de California bicycle race, and of course, there is the Hans Christian Andersen Museum located above the Book Loft.
But what makes Solvang special is that you really do get a ‘taste of Denmark’ — the quaint shops, restaurants and bakeries that dot its themed-designed main street, and the friendliness, particularly, of the towns’ people — who truly welcome you to a ‘little bit of Denmark’.
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Westside real estate market continues ahead of 2011....
Who told you we were out of the 2009 recession? Ask around and you get the feeling that while it is officially over according to the Federal Reserve (its definition), we are still seeing signs of a softness in our economy including high unemployment, etc. But even in these apparent bad times, we are seeing some resiliency in the market — sales volume for the four communities I report on — Beverly Hills, Beverly Hills Post Office, Bel-Air, and Brentwood — are up 4% — from $1.246 billion in June, 2012, to $1.298 billion at the end of July.
When you analyze the numbers, it is apparent that there are some immediate anomalies in the statistics from the Multiple Listing Service — for example, last year in July, there was the Aaron Spelling home that closed escrow for a lofty $85 million, which obviously throws any apples-to-apples comparison into the real estate #s out the door. And when you drill down to look at the number of homes sold between this July and last July (2011), they’re exactly the same — 51 homes sold each month (this is a total in the four communities)! So, if you backed out most of that $85 million sale in July 2011, we’d be substantially ahead of last year sales volumes. But that is the nature of our market — we have some very large properties that do come on the market and they skew the median sales prices..
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Median sales prices are mostly down for last month….but up for year
I know that doesn’t always make sense — one month median sales prices in your community are up, down the next. But that’s the nature of this business. The volatility of the market continues to be the norm — so please don’t be bothered by these monthly
fluctuations. For example, median sales prices for Beverly Hills (year to date) are up 49% over 2011; Beverly Hills Post Office is
up 30%; Bel-Air is up 58%, and Brentwood is down 15%. Remember, this is just one slice of the annual pie that makes up our median sales prices for the year. When you compare the median sales prices between 2012 and 2011 for the month of July, you will see that Beverly Hills is down 6%; Beverly Hills Post Office is down 45%; Bel-Air is up 49%; and Brentwood is down 19%. Much of these wild differences are caused by large sales that closed earlier this year, and we are seeing a slowing in the total sales volume compared to the previous year.
All of this means that regional and community statistics that are reported really can change “on a dime” — one month’s slow performance can drag down a community’s median sales price quickly or the reverse can be true.
My recommendation is that you 1) you continue to follow the trends in the Schiffer Line in your community, and 2) if you want to get an accurate read on your property’s value, please call me for a free appraisal.
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Could foreign buyers be pulling out of our market? We’ll see…..
Is the Foreign Goose who laid the golden egg leaving us? There are hints of late that foreign buyers, particularly Europeans in
search of bargains, could be poised to pull back from the U.S. housing market.
Trulia, which provides online real-estate listings as well as data on real estate, reported recently that foreign searches to its site for U.S. homes declined 9% during the last year. In the second quarter of this year, foreign searches accounted for 4.1%, down from 4.5% in the same period in 2011.
Foreign buyers have had a major impact on US real estate sales according to the National Association of Realtors (NAR) in the past few years as investors from Europe, Asia, and Latin America have literally invaded the US real estate market to take advantage of the low prices.
Even in countries at the center of the euro-zone crisis, such as Greece, Italy and Spain, where U.S. housing was seen as a comparatively safer investment, search volume is slipping. Trulia’s online traffic exclusively from euro-zone crisis countries dropped from 14.4 per 1,000 searches in the last quarter of 2011, to 13.3 per 1,000 searches in the second quarter of this year. That’s not to say that those foreign investors are feeling particularly optimistic about their local economies, but rising U.S. housing prices and shrinking inventories, along with more relaxed borrowing practices from the European Central Bank last year, could account for some of the shift, said Jed Kolko, Trulia’s chief economist.
“Last year the U.S. housing market got this silver lining from the euro crisis. That’s not happening anymore,” said Mr. Kolko.
A recent report by BBC Radio about the euro crisis suggested another explanation. The BBC found some who say that Spanish
banks are more willing to offer loans on their distressed residential properties to help cut their losses. This raises the question of whether European bargain hunters might start looking closer to home instead of overseas.
“It makes sense in a lot of ways,” said Paul Diggle, an analyst for research consultancy Capital Economics, regarding buyers’ appetite for distressed properties in countries like Spain. Falling inventories of homes for sale in the U.S. might also make buying in the U.S. difficult. Whether investors feel safe in the long-term investing in peripheral countries like Italy and Spain, he said, is another thing.
In the last few weeks, I personally have seen a drop off in the number of foreign buyers looking at my listings.
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Wells Fargo is no longer funding mortgages through brokers….
One of the tricks of working with an experienced real estate agent is having the confidence that they can assist in guiding you to find the best loan you can for your purchase. A major part of that search is finding the correct lender. Many times a buyer’s personal banking relationships are not the correct vehicle to use in obtaining your loan. Just recently one of my clients had a verypainful (for all concerned) experience where her bank, who shall remain nameless took a negative and totally illogical position about a HOA situation and caused her to not be able to get her loan. That position was solely related to the representative fr
om the bank being incompetent, nothing more and nothing less. The appraisal of her new home was perfect, and her credit was approved. Unfortunately by the time she tried to get a new loan, her loan contingency had expired, and the sellers had a back up offer for $75,000 more than she was paying for the house so she lost her ability to finalize her purchase.
Wells Fargo decided that it would no longer fund mortgages that were originated, priced, and sold by independent mortgage brokers. This doesn’t come as a shock to Coldwell Banker, since we deal with all of the major banks. Wells Fargo for some time has expressed its reluctance to deal with independent brokers.
Coldwell Banker, who works closely with First Capital, one of the nation’s largest and most prestigious mortgage brokers who is also a banker for some of their loans, has indicated that this policy will not affect their relationship with Wells Fargo or any other major lender. I have worked closely with two of First Capital’s senior mortgage brokers — John Ciolino and Steve Echkoff — and they have assured me that there will be no change in their ability to obtain loans, either from Wells Fargo or other major mortgage lenders.
As it stands, one in three mortgages originated by people in this country are done through Wells Fargo. Another key statistic is that at one time, mortgage brokers originated 40% of all mortgages. As we have all seen, one of the causes of the financial meltdown we all have been experiencing for the past number of years has been the fraudulent loan applications that were created by unscrupulous mortgage brokers that were accepted by the banks. Since 2008, this number has dwindled as enhanced scrutiny and the advent of the NMLS (National Mortgage Licensing Registry) testing requirements sent many brokers packing or back to school in order to maintain their profession. Settlements exceeding $25 billion in fines, fees, and penalties were levied against the major banks for various mortgage infractions in the last 36 months. This has caused Citibank, Chase, Bank of America, and Goldman Sachs to abandon the mortgage broker and/or correspondent (“direct lender”) distribution channels.
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Back to School
Where did the summer go? At the Los Angeles City Public Schools, summer is over with classes starting today three weeks early. The local private schools are starting a little later, but still within the next two to three weeks. In driving around, I have seen teachers getting ready for the New Year and unloading their class room supplies from their cars.
As another part of the school year calendar, and the construction on our local roads and by ways, the traffic officers are back at their posts on Sunset Blvd helping guide us through the traffic morass we all face on a daily basis. Don’t forget Carmageddon II scheduled for the last weekend in September!
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Vinegar – an earth friendly alternative to many chemicals
You can reduce the number of environmentally harsh and toxic chemicals used around your home by replacing them with more earth friendly, cheap and common substances such as vinegar. Here are a bunch of handy vinegar tips to get you started (some ofthem are quite interesting and comical)
A brief background on vinegar
Vinegar has been in use by humans for thousands of years; dating back to ancient Egypt. It was likely discovered by accident when wine went sour when left for too long. Vinegar is created by the oxidizing of alcohol in products such as wine or beer or any other fermented liquid. The active component of vinegar that makes it so useful is acetic acid; which is a byproduct of a bacteria called acetobacter. Spores of this bacteria float freely in our atmosphere, although commercial production of vinegar employs the use of cultured acetobacter in controlled conditions to make a consistent product.
Most table vinegars contain around 5 percent acetic acid. The most common types are White (usually made from corn) Malt (barley), Red Wine, white wine and apple cider vinegar. Of these, probably the most versatile for non-consumption purposes is White vinegar.
White vinegar is incredibly in expensive, particularly when bought in bulk (under a dollar per quart) and has a long shelf life. If a scum should form in it, this substance is known as the “mother” and can be utilized as a starter culture for creating vinegar faster from opened bottles of wine that you might otherwise discard.
Vinegar is also suitable for using in conjunction with black water systems – just don’t go overboard with it; otherwise you it may have an impact on the useful bacteria colonies in the system.
Handy vinegar tips:
Note: spot test before going all out with any of the cleaning related tips below.
• To remove calcium buildup on kettles and electric jugs, boil the kettle with half a cup of white vinegar and leave to soak for a while. Rinse with fresh water, re boil with same and your kettle should now be calcium deposit free.
• Place a small container of vinegar in your toilet and bathroom to eliminate odors.
• A half cup of vinegar added to a toilet bowl left overnight removes bowl odor. The smell of the vinegar will also dissipate overnight.
• A cotton ball soaked in vinegar and applied to bruises for an hour is said to speed up the healing process.
• Vinegar on minor burns and many sorts of stings can alleviate pain.
• For cleaning your dishwasher, vinegar frozen into ice cubes, then a couple added to the bottom of the dishwasher just prior to a cycle is an effective alternative to using heavy chemical cleaners.
• Old, stiff paintbrushes can be revived by dipping them into heated white vinegar for a couple of hours, followed by a rinse in soapy water. Beats using turpentine!
• Use it as a broad leaf weed killer – spray it undiluted onto the leaves of weeds, being careful to avoid plants you wish to keep. A mix of vinegar and salt can be used to keep weeks and grass out of driveway cement joins.
• Vinegar can be used as a bench top disinfectant; but it’s a good idea to wipe over at night in order that the smell dissipates.
• For pet owners, white vinegar poured onto pet urine mishaps on carpets, then blotted up with paper towel will prevent staining and odor.
• Save money on washing pre-spray by spraying undiluted vinegar on deodorant and other stains on garments just prior to washing.
• Spray a 50/50 mix of vinegar and water onto soap scum on shower doors, leave sit then wipe or rinse off.
• Vinegar can be used as a fabric softener by adding half the amount of vinegar as you would of your usual softening agent.
•(not to mention vinegar is great for chips and salad dressings :).
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Despite the “August Doldrums “that are supposed to exist, I can honestly tell you that I don’t see them.. I am still very busy! I have a great new listing which is perfect for a first time buyer. It is a lovely “done” 1 bedroom price at $445,000 in Santa Monica, 13 blocks from the beach, just south of Wilshire. I also have some great leases in Mountaingate as well as a fabulous home in Bel Air Park with views of the city. So if you know of anyone who has some real estate needs, please do not hesitate to give me a call.
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