Southern California homes sold at the fastest pace for an April in seven years amid the release of pent-up demand for move-up homes and high levels of investor purchases. The median sale price rose to a 58-month high, reflecting both home price appreciation as well as the simultaneous plunge in foreclosure resales and surge in mid- to up-market buying, a real estate information service reported.
A total of 21,415 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 4.1 percent from 20,581 sales in March, and up 9.5 percent from 19,562 sales in April 2012, according to San Diego-based DataQuick.
On average, sales between March and April have risen 1.0 percent since 1988, when DataQuick’s statistics begin.
Last month’s sales were the highest for the month of April since 27,114 Southland homes sold in April 2006, but they were 11.8 percent below the April average of 24,291 sales. The low for April sales was 15,303 in 1995, while the high was 37,905 in April 2004.
“This is a market that is still re-balancing. Sales of deeply discounted properties in affordable neighborhoods are way down. Activity in middle and high-end communities is on its way up. Now it's catch-up time, with a healthier economy spurring more demand and rising prices tempting more people to put their homes up for sale,” said John Walsh, DataQuick president.
The median price paid for all new and resale houses and condos sold in the six-county Southland was $357,000 last month, up 3.3 percent from $345,500 in March and up 23.1 percent from $290,000 in April 2012. Last month's median was the highest since June 2008, when the median was $360,000.
The median has risen on a year-over-year basis for 13 consecutive months, and those gains have been double-digit – between 10.8 percent and 23.5 percent – since last August. Still, last month's median remained 29.3 percent below the peak $505,000 median in spring/summer 2007.
It appears that well over half of last month’s 23.1 percent year-over-year gain in the Southland median sale price reflects rising home prices, with the balance reflecting the change in market mix.
Some of the Southland's most affordable housing markets, where prices were beaten down the most during the foreclosure crisis, posted some of the largest price gains. In April, the lowest-cost third of the region's housing stock saw a 20.7 percent year-over-year gain in the median price paid per square foot for resale houses. The annual gain was 18.5 percent for the middle third of the market and 15.2 percent for the top third.
Sales rose 35.4 percent year-over-year in the $300,000 to $800,000 price range – a range that would include many move-up buyers. The number sold for $500,000 or more shot up 52.7 percent from one year earlier and was at the highest level in just over five and a half years. Sales of $800,000-plus homes increased 51.4 percent year-over-year.
In April, 29.9 percent of all Southland home sales were $500,000-plus – the highest for any month since April 2008, when 31.1 percent of sales reached or crossed the $500,000 threshold. Last month's $500,000-plus level was up from 27.9 percent of sales in March and 21.0 percent a year earlier.
The number of homes that sold below $200,000 last month declined 29.8 percent year-over-year, while sales below $300,000 dipped 21.1 percent. Sales in many affordable markets have been limited not by a lack of demand, but by a lack of supply. The latter has two main causes: First, a relatively high percentage of owners can’t afford to put their homes up for sale because they owe more than those homes are worth. Second, foreclosures are way down, further limiting the supply of homes for sale.
Last month foreclosure resales – homes foreclosed on in the prior 12 months – accounted for 12.4 percent of the Southland resale market. That was down from a revised 13.8 percent the month before and down from 28.8 percent a year earlier. Last month’s figure was the lowest since it was 10.0 percent in August 2007. In the current cycle, foreclosure resales hit a high of 56.7 percent in February 2009.
Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 17.7 percent of Southland resales last month. That was down from an estimated 20.1 percent the month before and 24.3 percent a year earlier.
The portion of all homes sold to absentee and cash buyers dipped month-to-month but remained higher than a year ago and near peak levels.
Absentee buyers – mostly investors and some second-home purchasers – bought 30.2 percent of the Southland homes sold last month. That was down from 31.1 percent in March and up from 28.4 percent a year earlier. The record was 32.4 percent in January this year, while the monthly average since 2000, when the absentee data begin, is 18.1 percent. Last month’s absentee buyers paid a median $281,000, up 27.7 percent from a year earlier.
Buyers paying with cash accounted for 33.5 percent of last month's home sales, compared with 35.0 percent the month before and 32.2 percent a year earlier. The peak was 36.9 percent this February, and since 1988 the monthly average is 16.0 percent. Cash buyers paid a median $295,500 last month, up 31.3 percent from a year ago. Nearly 25 percent of the homes purchased by those paying cash last month were priced $500,000 or above, compared with 17.0 percent a year earlier.
The share of homes flipped has been running higher this year compared with 2012. In April, 6.0 percent of all Southland homes sold on the open market had previously sold in the prior six months, down from a flipping rate of 6.3 percent in March and up from 4.3 percent a year ago. (The figures exclude homes that were resold after being purchased at public foreclosure auction sales on the courthouse steps).
Credit conditions appear to be improving, although only incrementally.
Jumbo loans, mortgages above the old conforming limit of $417,000, accounted for 26.1 percent of last month’s Southland purchase lending – the highest since September 2007, when jumbos made up 26.9 percent of the market. Last month’s figure was up from 23.8 percent the prior month and 18.3 percent a year earlier. In the months leading up to the credit crunch that struck in August 2007, jumbos accounted for around 40 percent of the home loan market.
Last month 7.9 percent of Southland home purchase loans were adjustable-rate mortgages (ARMs), up from 7.4 percent the prior month and up from 7.0 percent a year earlier. Last month's figure was the highest since ARMs were 8.5 percent of the purchase loan market in August 2011. Since 2000, a monthly average of about 33 percent of Southland purchase have been ARMs.
The most active lenders to Southern California home buyers last month were Wells Fargo with 7.9 percent of the purchase loan market, JP Morgan Chase with 2.7 percent, and Prospect Mortgage with 2.5 percent.
Government-insured FHA loans, a popular low-down-payment choice among first-time buyers, accounted for 21.8 percent of all purchase mortgages last month. That was down from 22.7 percent the month before and 30.6 percent a year earlier. In recent months the FHA share has been the lowest since spring/summer 2008. The decline reflects tighter FHA qualifying standards implemented in recent years as well as the difficulties first-time buyers are having competing with investors.
DataQuick monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.
The typical monthly mortgage payment Southland buyers committed themselves to paying last month was $1,275, up from $1,252 the month before and up from $1,096 a year earlier. Adjusted for inflation, last month’s typical payment was 46.6 percent below the typical payment in the spring of 1989, the peak of the prior real estate cycle. It was 56.3 percent below the current cycle’s peak in July 2007.
Indicators of market distress continue to move in different directions. Foreclosure activity remains well below year-ago and far below peak levels. Financing with multiple mortgages is very low, and down payment sizes are stable, DataQuick reported.
|Sales Volume||Median Price|
An estimated 39,051 new and resale houses and condos sold statewide last month. That was up 3.4 percent from 37,764 in March, and up 2.1 percent from 38,241 sales in April 2012, according to San Diego-based DataQuick.
Last month's sales count was the strongest for an April since 48,894 homes were sold in April 2006. California April sales have varied from a low of 27,625 in 1995 to a high of 71,638 in 2004. Last month's sales were 11.1 percent below the average of 43,920 sales for all the months of April since 1988, when DataQuick's statistics begin.
The median price paid for a home in California last month was $324,000, which is the highest for any month since the median was $328,000 in June 2008. Last month's median was up 3.5 percent from $313,000 in March and up 22.7 percent from $264,000 in April 2012. April was the 14th consecutive month in which the state's median sale price rose year-over-year. In March/April/May 2007 the median peaked at $484,000. The post-peak trough was $221,000 in April 2009.
Of the existing homes sold last month, 13.5 percent were properties that had been foreclosed on during the past year – the lowest level since foreclosure resales were 12.6 percent of the resale market in September 2007. Last month’s figure was down from a revised 15.0 percent in March and 30.3 percent a year earlier. Foreclosure resales peaked at 58.8 percent in February 2009.
Short sales - transactions where the sale price fell short of what was owed on the property - made up an estimated 17.7 percent of the homes that resold last month. That was down from a revised estimate of 19.7 percent the month before and 23.9 percent a year earlier.
The typical mortgage payment that home buyers committed themselves to paying last month was $1,157. That was up from $1,134 in March and up from $1,010 a year earlier. Adjusted for inflation, last month's typical payment was 49.8 percent below the 1989 peak of the prior real estate cycle, and 59.3 percent below the 2006 peak of the current cycle.
DataQuick monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.
Indicators of market distress continue to decline. Foreclosure activity remains well below year-ago and peak levels reached several years ago. Financing with multiple mortgages is low, while down payment sizes are stable, DataQuick reported.
Source: DataQuick; DQNews.com
A majority of Americans now expect home prices to increase over the next year, pointing to growing optimism among housing-market observers, according to the results of Fannie Mae’s April 2012 National Housing Survey.
By comparison, in April of last year only 32 percent of those surveyed said they believed home prices would appreciate over the next year. In April, the three percentage point increase in the share of Americans who believe prices will increase was enough to push the total share of those bullish on home prices to 51 percent, Fannie Mae said.
“For the first time in the survey’s three-year history, the majority of Americans surveyed now expect home prices to increase,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Crossing the 50 percent threshold marks a significant milestone as most Americans believe a housing recovery is truly occurring throughout the country. Reflecting that increased optimism toward housing, the share of Americans who think it is a good time to sell has doubled during the last year. Many homeowners who have been underwater are gradually returning to positive equity, and selling is now becoming an available and attractive option again.”
As buyers continue to bid up prices in many markets suffering from a shortage of inventory, the share of Americans who believe now is a good time to sell continued to climb in April, according to the survey. That share of respondents rose by four percentage points in April to 30 percent, exactly double the share recorded last year.
Other results of April’s survey appear to highlight growing optimism among Americans in the larger economy as well. They include:
- The share of respondents who say the economy is on the right track increased 4 percentage points over March to 39 percent.
- The percentage of people who expect their personal financial situation to get worse over the next 12 months dropped by five percentage points to 16 percent.
- Eleven percent reported significantly lower household expenses compared to 12 months ago, a three percentage point increase over March.
It might finally be time to come out of the basement.
Seven years after the housing market began to collapse, rising prices and thinner inventories are presenting new opportunities for home sellers. Some hot markets are even seeing multiple offers for the same property—a phenomenon rarely seen since the boom years—as buyers become more confident and seek to take advantage of today's near-record-low mortgage rates.
Home prices nationally climbed 8.3% in December from the same period a year earlier, according to CoreLogic, a real-estate analytics company. The increase was the largest since May 2006 and the 10th consecutive monthly gain. The CoreLogic figures include foreclosures and other distressed sales.
The gains are good news for would-be sellers who have been stranded on the sidelines since home prices peaked in 2006. Nearly one in four homeowners and renters say now is a good time to sell a home, according to a survey released this month by Fannie Mae, the government-backed mortgage company, up from 11% a year earlier.
"You will unambiguously see more people test the water," says Thomas Lawler, an independent housing economist in Leesburg, Va. He expects home prices to rise another 3% this year.
Thinking about selling? You are likely to find a buyer more quickly and at a better price if you factor in local market conditions and recent sales before setting an asking price, burnish your home's Internet profile and plan ahead for a home appraisal.
Acting soon may pay off as well. While trends vary by region, buyer search activity generally peaks in March and April, while seller listings peak in July, says Jed Kolko, chief economist at real-estate website Trulia.com. "Most sellers would be better off if they pushed the process up a couple of months," he says.
Sellers could face headwinds if mortgage rates jump or the economy weakens, while the supply of homes for sale is likely to increase over the next few months, creating more competition, say real-estate agents.
Don't expect to make a killing. Even after the recent gains, home prices remain about 27% below their 2006 highs, according to CoreLogic.
In some markets, prices remain so low that selling is likely to prove painful—unless you are looking to buy a more expensive home at a discount.
"The only reason I would sell today is if I wanted something more than I currently have," says Craig Beggins, president of Century 21 Beggins Enterprises in Tampa Bay, Fla., where prices are still off more than 40% from their 2006 peak.
Still, in many markets, sellers have more of an edge than they have had in years. One big reason: The number of existing homes on the market dropped to 1.74 million in January, down 25% from a year earlier and the lowest level since December 1999, according to the National Association of Realtors.
Houses are also selling faster. The median number of days on the market for homes in January was 71, according to the Realtors group, meaning half of all homes sold within that time. That's down from 99 days one year ago.
Elizabeth Tolli first put her 4,400-square-foot St. Petersburg, Fla., house up for sale in late 2009, but took the listing down a year later after not receiving any offers. She recently put it back on the market.
"I feel more confident, even if prices aren't at the height they were six or seven years ago," says Ms. Tolli, who has set a $1.2 million asking price for the five-bedroom waterfront property. That is more than it would have fetched a year or two ago, she says, but still well below its peak value of more than $2 million.
If you are thinking of making a move, start by assessing conditions in your local market. Lanny Baker, chief executive of ZipRealty, an online real-estate brokerage based in Emeryville, Calif., suggests focusing on five measures: price changes, the inventory of homes for sale, competition from foreclosures, the average time it takes a home to sell and the gap between selling prices and list prices.
In markets such as Las Vegas, San Francisco, Los Angeles and Washington, D.C., "prices are up, competition is down, bank competition is down more, days on the market are shorter, and the prices being realized relative to the list price have really improved," all good news for sellers, Mr. Baker says.
But sellers shouldn't be complacent. Here are some steps to consider.
Interview multiple agents. Some people prefer to handle the selling process themselves. But if you plan to use a real-estate agent, start by interviewing several contenders.
Mr. Baker of ZipRealty suggests narrowing your search to agents who have handled many sales in your neighborhood. They are likely to have the best view of local market conditions and can better assess what your home may sell for and how it should be marketed, he says.
Nancy Vaske, a jewelry designer in Chicago, interviewed four brokers before putting her 1,800-square-foot condominium on the market this past week for an asking price of $995,000.
"I wanted to know whether they had sold any units in my building because it's a specific market in the city, and whether they've represented the buyer or the seller," she says.
The broker Ms. Vaske chose has represented both sellers and buyers in her building, and "probably knows more details about the workings of this building than most residents do," she says.
Adjust your sights to today's market. Set aside what you home might have fetched in 2006 and focus instead on what homes are selling for today.
Dan Elsea, president of Real Estate One in Detroit, uses recent sales as his guide, paying particular attention to properties that have received multiple offers. He prefers the homes he sells to be among the five lowest-priced properties among similar homes. "Typically, a buyer will see and remember five homes at a time," he explains.
Pay attention to how long competing homes have been on the market. These days, well-priced homes often sell in a week or two, while homes that languish for months are typically priced at unrealistic levels.
Don't overreach. Given today's thin inventories, it is tempting to reach for the stars. But if you get greedy and set the price too high, you are likely to wind up in a downward spiral.
"You are going to have your largest viewing audience in your first days on the market, when the house is the newest product on the shelf," says Lloyd Fox, a broker at Long Realty in Scottsdale, Ariz. If the price is too high, buyers and agents are likely to relegate your listing to the sidelines.
Properly priced homes are likely to get eight to 10 showings their first week on the market and an offer soon after, Mr. Fox says. If not, "you have missed the market" and it's likely a price cut is in order, he adds.
Make the Internet work for you. Most home buyers and agents are now starting the search process online, which means it is important to make the Internet a key part of your marketing strategy. Begin by carefully selecting the photos you will post online.
For maximum impact, start with the photo "that is going to tell the best story of your home," whether it's the front view or a special feature, says Mr. Fox, the Scottsdale broker. Too many shots of a single room could bore buyers, he adds.
For Kenneth Vaughan's Phoenix home, Mr. Fox started with a photo of the home's exterior to show its "curb appeal," followed by photos of the living room, kitchen, backyard and master bedroom and bathroom. The home, which is selling for $119,900, received three full-priced offers in the first week, says Mr. Vaughan, a retired police officer.
Factor in Internet searches when setting your listing price. Because most buyers tend to search in $25,000 or $50,000 increments, you can maximize your exposure by pricing your home at a round number, such as $400,000. That way the house will show up when buyers search for homes in the $350,000 to $400,000 range and for those priced at $400,000 to $450,000.
Weigh multiple offers carefully. In cases of multiple bidders, you should focus not just on price, but also on terms.
In comparing two competing bids at similar prices, Kristine Lambrecht, an agent at Real Estate One in Clarkston, Mich., recommends choosing the buyer who is putting down more cash or is willing to forgo an inspection, since those deals are likely to close sooner and with fewer hassles. If she thinks the appraisal will be lower than the sale price, she will take a slightly lower bid if the buyer is willing to guarantee the purchase price.
Clean up your act. Even in a market where inventories are thin, a home isn't likely to sell if it looks shabby or crowded. At a minimum, you'll need to touch up the paint, clean the carpet and pare your possessions.
Suzanne Peltier, who lives in Farmington Hills, Mich., hired a handyman to patch loose bricks and touch up the paint on her four-bedroom Colonial before putting it on the market. She also removed some of her furniture so the home looks bigger.
Julie Kaczor, a broker at Baird & Warner Real Estate in Chicago's western suburbs, advises clients to get rid of magazine racks, statues, fireplace tools and anything else that can clutter up the edges of a room. She looks for inexpensive fixes with good payoffs, such as a fresh coat of paint, removing outdated window treatments or a carpet cleaning.
Ron Phipps, principal broker at Phipps Realty in Warwick, R.I., often sends clients to other sellers' open houses to size up the competition and get a better sense of how buyers may view their home. "It's a good way to do counterintelligence," he says. "It's also a good way to see what works in terms of staging and presentation and what makes you uncomfortable."
Plan ahead for the appraisal. About 30% of real-estate agents reported that low appraisals had resulted in the cancellation, delay or renegotiation of a purchase, according to a January survey by the National Association of Realtors.
You can reduce the chances you will encounter problems by providing the appraiser with examples of comparable sales and pointing out special features. Barbara Moody, an agent at Coldwell Banker United Realtors in Sugar Land, Texas, prepares a booklet for appraisers that includes examples of comparable sales, information about the home and receipts for substantial upgrades such as a swimming pool or kitchen renovation.
When a recent sale was almost torpedoed by a low valuation, Ms. Moody showed the appraiser comparable homes he had missed. The result: The appraiser raised his valuation by $7,000 to $129,000. The buyer and seller then split the difference between the appraised value and the $132,000 price they had initially agreed on.
Jan Baker, the home's former owner, says the deal would have fallen through without the higher appraisal. "I would have had to have rented it again," says Ms. Baker, a lawyer who purchased the home in 2005 for $136,900 and now lives in Midland, Texas.
Sometimes, it’s nice not to get noticed.
California failed to make the Top 10 list of states with the most foreclosures in March, a new report by RealtyTrac says.
The state where “zero interest,” no down-payment and “no-doc” loans fanned the fire of the real estate boom before the bust slipped to the No. 11 position with a total of 18,489 foreclosure filings in March.
There were 7,565 notices of default, 7,514 notices of trustee sales and 3,410 notices of bank take-backs in California.
The March filings dropped 59 percent from the year earlier for California. Filings in the Inland region counties of Riverside and San Bernardino fell by 61 and 52 percent, respectively, to a meager 3,381 filings. When foreclosure roiled through the region, it was not uncommon to report 20,000 filings in one month.
So is this pain about over? Has the tide turned to some state of normalcy? Send us your thoughts:
Here are the states that made the Top 10 list for foreclosure activity in March:
Nevada, No. 1: With 3,787 total filings — some 2,188 of them initial notices of mortgage default, Nevada is in tough spot. One in every 306 homes in Nevada were in some state of mortgage distress. In California, one out of 737 housing units received a foreclosure filing.
Florida, No. 2: This judicial foreclosure state had 28,248 total filings in March, a 5.5 percent increase from one year earlier. Some 7,562 housing units were taken back by lenders.
Illinois, No. 3: Foreclosure activity in Illinois fell 13 percent from March 2012, but its 11,977 filings still put the state in the third position for the highest levels of foreclosure in the U.S. One in every 441 housing units were in some state of foreclosure in Illinois.
Ohio, No. 4: With 10,731 total foreclosure filings from notices of default to bank take-backs, this state has seen foreclosure activity rise 27.4 percent from March 2012. Filings also rose 1.6 percent from the month before.
Other states to rank in the Top 10 chart were: Maryland, Georgia, Arizona, South Carolina, Washington and Indiana.
Finally, it’s spring. To celebrate, do a few improvements indoors — tweaking your home’s energy efficiency and getting doors to operate smoothly — and then get outdoors to do some work that shows off your home’s exterior. Install a new screen door or repair an old one. Maintain fireplaces and gas appliances while avoiding the scammers who pop out of the woodwork like bugs this season. Repair fences. Remove stubborn stains from concrete garage floors, patios and sidewalks. And try one or all of our eight cheap and fun ways to give your home’s entrance some exciting spring sparkle.
Install a programmable thermostat
Energy is wasted when you push up the temperature when the room feels cold or turn down the heat manually when it’s too warm. You can save about $180 a year with one of these devices.
A programmable thermostat lets you set the temperature in your home, then leave it. The most useful products give you options for establishing different temperatures for day and night (62 at night, for example, and 65 during the day), weekdays and weekends (keep the house cooler while you’re away at work and warmer when you’re home) and also let you turn the heat way down during vacations without changing your daily settings. (Learn more and find out how to get a federal tax credit and possible rebates in this Energy Star article on programmable thermostats)
Cut energy expenses further
While you are in the mood to reduce energy consumption, call your electric utility and/or your heating-fuel company to ask about financial incentives for installing energy-efficient appliances or improvements. Some utilities subsidize the cost of improvements: adding insulation or weatherstripping, or installing that programmable thermostat, for example. Others give rebates for purchasing Energy Star appliances such as water heaters, air conditioners, dehumidifiers, heat pumps and fans. Also, remember to take the federal tax credit for such purchases. See the entire list at the Energy Star site. Senior citizens may qualify for additional subsidies.
Look for additional savings: Many states offer additional incentives. Find programs in your state onthis map, at the Database of State Incentives for Renewables & Efficiency.Straighten out problem doors
Walk around the house with a can of silicone lubricant and a rag, trying each door. If a door is sticky, open it partway and pull the hinge pin out. The pin is found in the center of the hinge, in the joint between the plate on the wall and the one on the door. Lightly oil the pin and the hole into which it will fit, using the rag to stop drips. Drop the pin back in place. (Find inspiration and tips at "Door repair 101: How to fix a squeaky door hinge, gaps and more.") If a pin is stuck in a hinge, use a hammer and small screwdriver to knock it all the way out. Sand off accumulated oil, dust and rust from pin and lightly lubricate it before reinstalling. You may have to do this with both pins.
Repair or replace screen doors
Get ready for bug season by hanging screen doors. You can repair torn screens yourself:
- Measure the screen opening. You’ll need overage, so add at least an inch to each side. Bring the measurements to a hardware store and purchase a new length of screen.
- The screen is held in place by a flexible cord fitted into a channel that runs around the screen frame. Lift out the cord. If it is old and brittle, measure it and buy new cord at the hardware store.
- Place the new screen over the opening, fit it snugly in place by settling the cord in its channel around the entire opening (poke it in place with a screwdriver). Trim the excess screen with scissors or a box cutter.
If the door sags, see if you can tighten it by replacing missing or corroded hinge screws. If that doesn’t work, or if the door is bent or battered, purchase and install a new aluminum screen door.Install a chimney cap
You could send out an invitation to birds and squirrels to come nest in the warmth of your chimney, or you could install a cap to protect the stack from dripping rain and uninvited critters. A cap, sometimes called a “crown,” shelters the opening while it lets smoke escape. A cap prevents wind from entering your home and helps create a good draft that feeds your fireplace or stove with oxygen. Metal chimneys usually come with caps, but if yours doesn’t have one, ask the manufacturer for advice. Caps are not appropriate for all chimneys. Ask your chimney sweep to inspect the chimney each year for damage and to advise you on whether to install a cap.
Beware chimney-sweep scams
Yes, you should have your chimney swept by a professional to remove flammable creosote that builds up inside the flue from wood smoke. (If you don’t use the stove or fireplace much, you can wait two to three years between cleanings.) But not every chimney sweep is right out of “Mary Poppins.” Door-to-door scammers prey on homeowners, dangling deliciously low prices, then pressuring owners into “repairing” expensive but fictitious problems. Protect yourself by using a chimney sweep with an established business in your town. Check a company’s track record through the Better Business Bureau and locate certified sweeps at the National Chimney Sweep Guild or the Chimney Safety Institute of America.
Have gas-burning furnaces and appliances inspected
Every year a licensed gas technician should clean out dust and debris and examine the appliance for safety, efficiency and repairs. Find a repair pro through your gas company or utility or search the Plumbing-Heating-Cooling Contractors Association's site.
RENTING VS. BUYING
Due to trends in home prices and mortgage rates, this is an excellent time to look into buying
your dream house. If you’ve been thinking about buying a home, one question you’ve probably
asked yourself is “Can I afford to buy a home?” Perhaps a better question to ask is “Can I afford
to rent?” No matter how much you pay in rent, chances are that the amount you pay could
add up over several years to be the price of your dream house, if not more. The following chart
shows how much rent payments would add up to, considering the money invested would earn 5%
RENTING VS. BUYING
Rent 10 Years 20 Years 30 Years
$600 $93,168 $246,920 $499,855
$800 $124,226 $328,827 $665,807
$1,000 $156,282 $411,034 $832,269
$1,200 $186,339 $493,240 $998,710
$1,500 $232,823 $616,561 $1,248,388
$2,000 $310,566 $822,067 $1,664,517
$2,500 $388,206 $1,027,584 $2,080,647
In addition to the investment gains lost through renting, you may want to keep into consideration
common concerns most of us have as a renter as well as a home owner.
Tax deduction of Mortgage interest
Free to change décor and landscaping
Not dependent on landlord to maintain property
Responsible for maintenance
Responsible for property taxes
Responsible for Hazard Insurance
Less mobility than renting
Sense of community, stability, and security
Easier to move
No tax benefits
No equity gains
Possibility of eviction
No control over rent increases
The economy is improving, but foreclosure is still in our midst.
Recognizing that, the Hope NOW Alliance and Making Home Affordable program has set up a free, April 16 workshop at Los Angeles Convention Center, 1201 South Figueroa Street, to help struggling homeowners.
The event is designed to give homeowners a chance to meet face-to-face with their mortgage company and a HUD-approved counseling agency to work on solution to help avoid foreclosure. Refinance assistance will also be available to struggling borrowers who are current on their mortgages.
Mortgage companies expected to participate in the 1 to 8 p.m. event include Bank of America, Chase, Citi Mortgage, GMAC Mortgage, Homeward Residential, HSBC, Nationstar, Ocwen, OneWest, PNC, Select Portfolio Servicing, Seterus, US Bank and Wells Fargo.
For more information, visit: www. HopeNow.com orwww.MakingHomeAffordable.gov
Home prices in most parts of the country are just about as affordable as they are likely to get, and mortgage rates remain super low. Together, those factors mean that many people are thinking about buying a home. Some will be first-time homebuyers, while others will be “boomerang” buyers who lost their homes in the housing meltdown but are now hoping to get back in. Still others may see this as the best time to upgrade to a larger home, downsize to a smaller one, or to move to the retirement locale of their dreams.
Whatever your motivation for buying a home, unless you are going to pay cash for the property, there’s one essential step you must take first: get your credit reports and credit scores.
The reason? Your credit scores will help determine what type of home loan financing you can get, and the interest rate you’ll pay. You’ll want to have plenty of time to dispute credit report errors if you find any, and get them fixed. The last thing you want is to find out at the last minute that you can’t buy your dream home because of something on your credit report that shouldn’t be there.
If you will be buying and financing a home with someone else — a partner or spouse, for example — you’ll each want to get your credit reports and scores. Get them from all three major credit reporting agencies; Equifax, Experian and TransUnion, as they each collect their own data and don’t share corrections with each other. You can do this for free once annually atAnnualCreditReport.com.
You’re Not Just a Number
The three-digit number that represents your credit score will be important when it comes to buying and financing a home. A difference of a few points could make a difference in the rate you’ll pay for your mortgage. Mortgage lenders will typically use the middle of the three credit scores to determine the rate/program for which you qualify.
But that doesn’t mean you need to obsess about your score. Doing so can cause you unnecessary grief. After all:
- Trying to tweak your scores based on what you think may help improve them can sometimes have the opposite effect.
- There are many different loan programs with different credit score requirements. A loan officer can help you shop around to find the right program to meet your needs.
Keep in mind that you have many scores, not just one, so trying to figure out which scores matter most can be an exercise in futility. When it comes time to apply, your lender will pull the credit scores needed to process your application. In the meantime, you can find out where you stand and get an idea of what factors may be strong, and which may not be. Again, no need to obsess over the number.
In fact, when we recently included a free credit score with our free Credit Report Card — one of our most popular tools — since we wanted to make sure that consumers understand that they don’t have a single score. That’s why we provide an Experian Scorex Plus score, but also show consumers their estimated VantageScore and FICO scores along with it. After all, there are dozens of scores available at any given time, and if you focus on just a single number, you may miss the bigger picture.
What’s in a Number?
If focusing on the number that represents your credit score isn’t the most important thing, then what is? Understanding the elements that make up your scores can be much more important. Our Credit Report Card, for example, assigns a grade to each of the main factors that go into a score:
- Payment History
- Debt Usage
- Credit Age
- Account Mix
Within those, we recommend you put your efforts toward the things you can control. If you get a “C” or “D” for a particular factor, you’ll get suggestions for things you may do to address that grade. Some of these may be things you can address immediately while some may not be under your direct control.
If you earn a “D” for debt usage because your balances on one or more of your credit cards is close to your limits, you may want to pay some of them down if you have the cash available to do so. On the other hand, if you have a large student loan balance that you can’t afford to pay off, you may want to simply focus on making your payments on time rather than taking all the money you’ve saved for a down payment to pay it off.
What Can Your Score Do For You?
When it comes to buying a home, your credit scores can help you secure the financing you need to buy the property and pay it off over time. Your credit scores are a tool to help you achieve your personal and financial goals. If you can get the loan you need with the credit scores you have, then be satisfied with that — even if you don’t have the best score your loan officer has seen!
And finally, it’s important to put your scores in context. Mortgage lenders will look at other factors, like your debt-to-income ratios, employment history, and down payment. As any loan officer can tell you, even a perfect score can’t get you a loan if — for example — the appraisal comes in too low, or if you can’t document your income.
Buying or selling a home is one of the biggest financial transactions most people will ever make in their lives. It can be stressful and overwhelming, but the good news is you are not alone. Real estate agents are trained experts that can help you through the process. Follow this advice to find an agent that best suits your needs.
How to Choose a Real Estate Agent
No matter if you are looking for a buyer’s agent or a listing agent, you need someone that is an expert on your neighborhood and that is familiar with your area’s market.
Your neighborhood is a good place to start looking for your agent. Keep your eyes peeled for agents that have a lot of for sale signs in your area. Talk to your neighbors to see which broker they used and what they thought about the experience. You can also drop into open houses to see the brokers in action.
Interview The Agent
Treat the agent hiring process the same way you would hire a new employee. You need to interview several candidates, get a good understanding of their track records and gather references.
Start off the interview process by asking to see their current and previous listings and pay special attention to the price ranges, neighborhoods and list to sell prices.
Take stock of who the agent is as a person. Have the agent sell you on why she is the perfect person to find your next home or sell your current home. If the person can’t sell herself, she can’t sell your home. Ask yourself if she seems honest, communicative and hard-working.
Find out if the agent works on a team and who will handle each part of the process. Having a support team behind your agent can be helpful, but be sure to get an understanding if the big name broker you are expecting to work with is actually the person that will show up.
It is also important to review the buyer purchase or seller listing agreement and take a close look at your cancellation rights.
Dive Into The Numbers
Find out what the agent’s real estate fee is, but don’t automatically go with the person with the lowest fee because it might mean they are pressed for business or inexperienced. If you are buying and selling a home at the same time or can use the broker for future purchases, then you should try to negotiate the fee.
Likewise, when you ask the agent what they will list your house for, don’t necessarily go with the person that says she can get you the highest price. It might mean that she is unfamiliar with the market or trying to tell you what you want to hear to get hired.
If you are working with listing agents, ask about what types of marketing they will do and what they will spend. At a minimum you can expect open houses, professional photos, website promotion and advertising.
Stay informed, do your own research, have an open mind and keep lines of communication open with your agent and you will find your new home in no time.
|Date||City||Price||Sq. Footage||Bdrms||Baths||Days on Market||Address||Street||Street Suffix||Zip Code|| |
|4/27/2012||Corona|| ||540||1||1|| ||2160||Highpointe||Drive||92879||Details |
|4/27/2012||Corona|| ||642||1||1|| ||1005||Vista Del Cerro||Drive||92879||Details |
|4/27/2012||Corona|| ||642||1||1|| ||1965||Las Colinas||Circle||92879||Details |
|4/27/2012||Corona|| ||740||2||1|| ||1038||7TH||Street||92882||Details |
|4/27/2012||Corona|| ||857||2||1|| ||809||Paseo Grande|| ||92882||Details |
|4/27/2012||Corona|| ||1,004||2||2|| ||3140||CASTELAR||Court||92882||Details |
|4/27/2012||Corona|| ||1,062||3||2|| ||934||Cedar||Street||92879||Details |
|4/27/2012||Corona|| ||1,074||2||2|| ||1125||Border||Avenue||92882||Details |
|4/27/2012||Corona|| ||1,122||3||1|| ||790||Via Bernardo|| ||92882||Details |
|4/27/2012||Corona|| ||1,227||3||2|| ||9115||Fallbrook Canyon||Drive||92883||Details |
|4/27/2012||Corona|| ||1,245||3||2|| ||1503||LINCOLN||Avenue||92882||Details |
|4/27/2012||Corona|| ||1,245||4||2|| ||9274||Palm Canyon||Drive||92883||Details |
|4/27/2012||Corona|| ||1,245||4||2|| ||9406||PALM CANYON||Drive||92883||Details |
|4/27/2012||Corona|| ||1,278||3||2|| ||360||Citron||Street||92879||Details |
|4/27/2012||Corona|| ||1,318||3||3|| ||2219||ASCOT||Street||92879||Details |
|4/27/2012||Corona|| ||1,320||3||3|| ||13356||Blackdeer||Drive||92883||Details |
|4/27/2012||Corona|| ||1,384||3||3|| ||471||Brookhaven||Drive||92879||Details |
|4/27/2012||Corona|| ||1,385||3||3|| ||1110||Portofino||Court||92881||Details |
|4/27/2012||Corona|| ||1,437||3||3|| ||13346||Blackdeer||Drive||92883||Details |
|4/27/2012||Corona|| ||1,439||3||3|| ||13368||Blackdeer||Drive||92883||Details |
|4/27/2012||Corona|| ||1,445||3||3|| ||1385||Elgin||Way||92879||Details |
|4/27/2012||Corona|| ||1,560||3||3|| ||2180||Cedar Glen||Circle||92879||Details |
|4/27/2012||Corona|| ||1,699||3||3|| ||365||Camden||Court||92879||Details |
|4/27/2012||Corona|| ||1,702||4||3|| ||440||Brookhaven||Circle||92879||Details |
|4/27/2012||Corona|| ||1,786||3||3|| ||978||Highland View||Drive||92882||Details |
In the Inland region, low inventory is pushing up home prices, bailing out underwater homeowners and strengthening recovery
The real estate market in the Inland region is at an interesting juncture: tight inventory and pent-up demand; investors, foreign and domestic, pitted against first-time homebuyers for a dwindling number of affordable homes.
Prices are appreciating at rates not seen since the market over-corrected in the Great Recession to bargain-basement levels.
Homeowners, long underwater on equity, are starting to come up for air.
Agents so strapped for listings, are knocking on doors.
“This is unprecedented,” Inland economist John Husing said.
“It’s a dynamic that is out of balance,” said Paul Herrera, government affairs director for Inland Valleys Association of Realtors. “People who own property are enjoying what’s happening with price points at the moment, but if you want to own a piece of property, you may be very frustrated right now.”
Housing inventory in the Inland region at the end of February fell to 8,113 listings, down significantly from the 15,120 listings recorded in Riverside and San Bernardino counties in February 2012. Since December, the levels have ranged from 6,900 to 7,500 listings.
Although the number rose, the pace is well below what’s needed to sustain a normal amount of home sales, Herrera said.
The dynamic is playing out across the nation.
Total housing inventory at the end of January fell 25 percent year-over-year to 1.7 million existing homes available for sale, a 4.2-month supply at the current sales pace.
That’s the lowest housing supply since April 2005. In Riverside and San Bernardino counties, total listings dropped 40 percent from one year ago.
“In terms of raw numbers, these are the lowest we’ve seen since December 1999,’’ said National Association of Realtors spokesman Walter Molony.
Limited housing supply is being constricted even further because foreclosures are falling, and a large chunk of that distressed property is getting gobbled up by investor groups before they hit the open market, Husing said.
Even if homebuyers want to take advantage of good prices, Husing said, they don’t have the opportunity because the properties are fast-becoming transformed into the new rental market.
The state of flux with inventory loads has prompted the national Realtors association to upgrade its projections on housing price appreciation from 5.6 percent in 2013 up to 7 percent.
Bruce Norris, founder of The Norris Group, who early in the year predicted that price appreciation would be considerably more aggressive here — pegging price gains of 20 percent in the Inland area real estate market for 2013 — hasn’t altered his stance.
“Whoever buys property one year from now will have a big smile on their face,” Norris said.
It’s also become a seller’s market in the sense price has gone up from where it was, Norris added. “But a lot of inventory is still well below the replacement cost: We’re still a way from the peak of prices it could get to.”
Steve Manos, a real estate broker with Prima Vista Realtors, characterized the shift toward a sellers’ market as a positive, natural progression of the housing recovery.
“We have to go through this,” he said. “Home prices have to re-bounce” to get homeowners who are still sitting in place to regain mobility in the marketplace.
Last year, Zillow.com, the real estate information reporting service, said there were 1 million fewer homeowners who were underwater and no longer owed more on their mortgage than their home was worth. The percentage fell 1 percentage point to 27.5 percent, or 13.8 million people.
This year, another 1 million will be freed from their negative equity position, Zillow.com predicted.
Christopher Thornberg, founder of Beacon Economics, said this confluence of events is causing inventory to dry up.
It’s also helping to boost homebuilding, and that’s driving new jobs into the market. “The surge in payroll jobs at the national and state level is good news,” he said. “It’s pushing the economy forward. The narrow recovery is becoming wider.”
The S&P/Case-Shiller 20-City Composite index posted its largest year-over-year gain in January since the summer of 2006.
The index, which tracks single-family home prices in 20 large U.S. metros, was up 8.1 percent in January from a year ago with all 20 areas including New York, which hadn't seen year-over-year positive light in 28 months, registering gains.
Nineteen of the 20 metros saw home prices jump higher in January from the previous year than they did in December with each area but New York (0.6 percent), Chicago (3.3 percent), Boston (4.0 percent) and Cleveland (4.8 percent) showing greater than 5 percent year-over-year leaps.
Source: S&P Dow Jones Indices & Fiserv
The January Case-Shiller report shows strong price increases, said Trulia Chief Economist Jed Kolko. "We're seeing prices increase both in markets that had a really big decline during the bust," he said, "as well as markets that have really strong fundamentals."
The other markets posting year-over-year gains were: Los Angeles (12.1 percent), Minneapolis (12.1 percent), Miami (10.8 percent), San Diego (9.8 percent), Denver (9.2 percent), Tampa (8.9 percent), Seattle (8.7 percent), Portland (8.3 percent), Dallas (7.0 percent), Charlotte (6.0 percent), Washington (5.9 percent), Cleveland (4.8 percent), Boston (4.0 percent), Chicago (3.3 percent) and New York (0.6 percent).
In January, however, eight of the 20-City Composite markets saw non-seasonally adjusted monthly declines in home prices. Chicago (-0.9 percent), Detroit (-0.9 percent) and Washington (-0.7 percent) led the way.
But if seasonal factors were taken into account, none of the 20 markets saw monthly price declines in January.
The nine markets experiencing non-seasonally adjusted monthly price declines in January were Chicago (-0.9 percent), Detroit (-0.9 percent), Washington (-0.7 percent), San Diego (-0.6 percent), Cleveland (-0.5 percent), Minneapolis (-0.5 percent), Portland (-0.4 percent), Seattle (-0.3 percent).
Markets seeing non-seasonally adjusted gains from December to January were Las Vegas (up 1.6 percent), Phoenix (1.1 percent), Atlanta (1.0 percent), Los Angeles (0.9 percent), Tampa (0.9 percent), Miami (0.8 percent), Charlotte (0.2 percent), New York (0.1 percent) and San Francisco (0.1 percent). Boston, Dallas and Denver saw no change.
The National Association of Realtors on Thursday, March 20, reported that existing home sales across the nation in February rose eight-tenths of 1 percent to a pace of 4.9 million from the month before, and 10.2 percent from one year earlier.
Lawrence Yun, chief economist, said in a statement that conditions for continued housing improvement are taking root. Job growth and pent-up demand are sparking home sales and rental leasing, he said.
For the West, existing-home sales rose 2.6 percent to a pace of 1.2 million from January and 1.7 percent from February 2012. Limited inventory and reports of multiple bids on sales pushed the median price up for February to $237,000, some 22 percent higher than one year ago.
Once a raging inferno, foreclosure levels across the U.S. have been downgraded to a level categorized as a controlled fire with hotspots, a report by the real estate tracking firm, RealtyTrac, found.
“Foreclosure activity has been effectively contained and should be reduced to a slow burn in the next two years,’’ RealtyTrac vice president Daren Blomquist said, as the Thursday, March 15 report on February foreclosure filings was released.
Hotspots that are likely to occur in the Inland region may also be a statistical anomaly.
Nationwide, the total filings against 154,281 properties across the U.S. rose 2 percent from January but are down a more significant 25 percent from February 2012.
California foreclosure activity, in descent for 15 straight months, decreased by even bigger percentages — 62.8 percent from February 2012, knocking the state that’s long been listed at or near the No. 1 spot for unprecedented foreclosure activity down to No.13.
Inland region housing units received 3,299 of the state’s 18,003 total foreclosure-related filings.
For Riverside and San Bernardino counties, filings rose eight-tenths of 1 percent from January but fell 63.5 percent from February 2012. Its metropolitan ranking fell to the No. 25 spot. The Inland area had been among the worst for foreclosures for several years.
Chapman University economist Esmael Adibi said a fundamental shift has taken place to put downward pressure on foreclosure.
Home prices are showing enough appreciation to buoy some homeowners who were underwater on their mortgage show enough equity to recoup the loss, or be in a position to refinance their loan, Adibi said. Banks and financial institutions are in much greater shape financially.
“More is being done to help a property owner facing foreclosure to reduce their interest rates, or in some cases forgive their mortgage principal,’’ he said.
Yet, Blomquist sees the potential for flare-ups ahead in states like California — and the hard-hit Inland region — where new legislation has made it more difficult to foreclose on property outside of the court system.
New filings rose markedly after a 13-month-long hiatus, he said.
“What’s still playing out is how the servicing and lending industry is going to deal with the new Homeowner Bill of Rights in California,’’ Blomquist said. “I think we’re already seeing signs they’re figuring it out, and are starting to ramp back up on foreclosures.”
The legislation, to take effect Jan. 1, set limitations on dual-tracking where a bank initiated foreclosure action against a property while dealing with a homeowner to modify a loan. The law includes trigger points to file a lawsuit for lender missteps.
New filings, the first phase of a foreclosure action classified as a notice of default, dropped 69 percent in January from December. From January to February, the count boomeranged up 88 percent to 1,145 notices of default.
The bump you see now could be the catch-up that should have happened, and otherwise would have been spread out over the past few months, Adibi said.
“If these notices of default continue, we’re going to see Riverside and San Bernardino counties move back into the Top 10’’ as a metropolitan hot spot, Blomquist said. He added this caveat: “Even with the rebound, the numbers are still down significantly from one year ago.”
The Inland region is past the half-way point as distressed property pumps through the pipeline, he said. “We are at least two-thirds of the way through the process.”
Put in perspective, the number of Inland housing units getting a foreclosure filing in 2006 averaged 2,500-per-month. Over the last 12 months, some 6,600 properties got a foreclosure filing from a notice of default to news of a trustee’s sale or bank take-back. At the peak, 23,000 Inland properties got foreclosure filings every month.
“I expect to see the region hit the 2,500-per-month level sometime near the end of 2014,’’ Blomquist said.
Adibi isn’t putting a timestamp on when the foreclosure pain will subside.
The region is moving to more normalized conditions, he said. “As we see strength in home price and job creation, the critical factor will be the reduction of the unemployment rate. It needs to be in the range of 6.5 to 7.5 percent.”