I've often told friends that part of what makes me love real estate is the Los Angeles real estate market.  There's nothing else like it.  You never know what kind of house you're going to see, who's house you're going see, or what you're going to find in a house once you're there. 

Just yesterday on caravan, we saw a listing in a fairly non-descript house, but the owner obviously had led sooooome kinda life, because there were framed photograph's of him with everyone who has been anyone during the past 30 years.  He and Liz Taylor, he and Al Pacino, he and Matt Damon, he and Cher, and many dozens more.  The walls were covered with them, many of them autographed to him.  I love going into homes and just being able to feel old Hollywood.  So yesterday the hot new listing on everyone's agenda was that of actor Billy Dee Williams, of Star Wars fame. 

The property is located in tony Trousdale Estates, which is where, outside of Palm Springs, you can find the biggest concentration of utterly breathtaking mid-century modern homes.  The property is 6 bedrooms and 6 baths in about 5,300 square feet.  To put it kindly, the house would  certainly be considered a fixer, with a lot of sort of sub-par additions seemingly added over the 25 years or so he's owned it, but the location, and the bones of the house were fantastic.   It will take a buyer with an eye and some money to put into it, but it definitely had potential.

Ben Stiller's Outpost Estates compound was also open yesterday, unfortunately I didn't make it over there.  Maybe next time...

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on February 1st, 2011.

I’ve been considering the possibility of putting my days as a renter behind me and joining the ranks of the homeowner, though I’m trying to figure out which makes more sense. I currently pay about $2,000/mo in rent (soon to go up). At what point is it more logical to quit renting and buy?

—Ryan K., Santa Monica

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Hi Ryan,

I get this question a lot. There’s no quick answer, and I would need some more information to give you a solid response. But I can tell you this. Real estate website Trulia.com recently released the results of a study of 50 U.S. cities, asking if it made more sense to rent or to buy in each city. When the housing market tanked and the recession began a few years ago, the answer in many cities flipped from one side to the other. According to the report, with massive foreclosures and homeowners unable to stay in their homes, the rental market became flooded with new customers. On the flip side, the sheer volume of homes saturating the market dragged prices down and created an opening for many who thought they would never be able to afford a home.

The rule of thumb Trulia offers in calculating whether renting is more affordable than buying is to divide the purchase price of a home by the annual rent of a similar property. If you come up with anything over a 15, it’s generally considered that renting is cheaper. Anything below, it’s a good market to become a buyer in. Of course this is a very general equation. Not for nothing, but L.A. came in with a 20 (using a median purchase price of $489,700 and an median annual rent of $24,900). That said, I still believe that given the deals out there right now that fall under that price range, it is a great time to buy. Renting, you spend your money to fatten someone else’s kitty. It’s money you will never see or hear from again.

There are many factors that have to be taken into consideration. First, do you have a down payment available, and do you qualify for a loan? Let’s assume for the sake of argument, yes and yes. Great! But there are other questions that address what your actual needs as an individual are. Maybe home ownership doesn’t make sense for you right now. If you plan to relocate in the next two to three years, renting is probably best. Also, some people don’t want to be responsible for any maintenance or upkeep. As a renter, all of that falls on someone else’s shoulders. Also, for renters, there are no homeowners dues, no property taxes and no major repairs. Maybe you’ve been in the same place for 10 years and pay $900 for a two-bedroom top-floor unit in West Hollywood. God bless rent control. It can be hard to give that up.

However, if you are looking to stay put for a while, you may be best served by purchasing something and begining to lay the foundation to build wealth. Over the long-term, real estate is an excellent investment and will build equity. And that equity is what will help you afford to move up to that second home when the time comes. There are many financial benefits that come with home ownership too. For over half of the period you’ll be paying your mortgage, most of that payment will be interest, which is tax-deductible. You can also deduct your property taxes (always consult with a tax preparer or CPA on these things). When you rent, that money is gone forever, just helping to pay someone else’s mortgage.

Home ownership brings with it a certain sense of accomplishment and pride of ownership. The property is yours to do whatever you want with (almost), and you can make improvements and upgrades over time to increase its value. There are significant tax breaks on the profit you make when you sell your home as well. The flip side of this is that some might choose to invest their savings into equities or the stock market or mutual funds rather than tying them up in the down payment on a home. To that, I say “to each his own.” I definitely don’t claim to be an investment professional. You have to do what’s right for you, but what I can say is that there has not been a better time to buy in Los Angeles in many years.

Jefferson Hendrick is an L.A.-based Realtor with Keller Williams. Contact him with questions, concerns and real estate inquiries at jefferson@kw.com or facebook.com/jeffersonhendrickrealtor.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on January 19th, 2011

The question I’ve spent the last two issues addressing is, what exactly does the process of buying a home look like? What should one expect? I’ve tried to really break it down for you in as much detail as possible while still keeping it somewhat brief.

8. Disclosures. In the last column, while on the subject of inspections and repairs, I briefly mentioned disclosures. The first week of the escrow period is also when you will receive, via your agent, a stack of state-mandated disclosures that the seller is required to provide (all on forms provided by California Association of Realtors) regarding the property. This is the seller’s opportunity to disclose to you anything and everything they know regarding the condition of the property, the neighborhood, the land, the structure itself—anything—that they know that might affect the salability of the property. Failure to disclose is one of the leading causes of lawsuits between buyers and sellers. When I’m working with sellers, especially on high-end properties, my advice is “when in doubt, disclose.” In other words, if you have to ask, just disclose it. By law, you as the buyer have three days after receiving any new information about the property to decide whether it’s acceptable to you before moving on.

9. Getting your loan approved. Over the next couple of weeks, your mortgage broker will be working furiously to get all of the required documentation from you in order to get your loan approved, and will send an appraiser to the property to make sure it’s worth at least what they’re lending on it. Don’t be surprised if the lender requires you to sign away your first-born child. It happens. Aside from being on standby for anything the lender needs, the next couple of weeks you’re basically in a holding pattern, beginning the fun stuff like making arrangements to move into your new home. On a side note, here’s a strong word of advice. Do not make the mistake of obligating yourself to be out of your current residence on the date you expect to close escrow on your new home. Delays can and will happen, and there is nothing more stressful than finding out two days before you are supposed to close that it’s been pushed back by a few days. Even worse is having a moving van scheduled for that day. Give yourself some leeway if at all possible.

10. Wrapping it up. It’s a few days before you are scheduled to close escrow. Your agent will schedule a final walk-through of the property with you, so that you have the opportunity to make sure everything is in the same condition it was when you agreed to purchase, and that any repairs the seller agreed to make have been completed. At this point, your loan should have been fully approved and your lender should have ordered loan docs. About two to three days before the scheduled close date, you will wire the remainder of your down payment and any other funds due. Typically, you will go to the escrow company’s office, where you will sign loan docs. This will entail signing your name about 800 million times. Depending on a few things, your loan should be funded by the lender the next day. The following business day, the property changes hands legally and officially, and that change is recorded with the county.

Congratulations. You just bought a home in 10 easy steps! If you think you might want to try this process out for yourself, give me a call and I’ll hold your hand the entire way. Likewise, if you or anyone you know is planning to sell a home, give me a call and let’s talk about how I can help.

Jefferson Hendrick is an L.A.-based Realtor with Keller Williams. Contact him with questions, concerns and real estate inquiries at jefferson@kw.com or facebook.com/jeffersonhendrickrealtor.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on January 3rd, 2011

First, Happy New Year. I hope you had an amazing holiday. When we left off last time, we were taking a casual stroll through the home-buying process, and what exactly one can expect when purchasing a home. As of the last issue, we’ve found you a mortgage broker, got you pre-approved, found you a buyers agent you love, zeroed in on the home of your dreams and negotiated price and terms. This is where it all starts to get real! Now it’s time to open escrow.

5. Escrow opens. The escrow period is the time during which all the business of the actual transaction takes place. At this point, you will be required to submit your three percent good faith deposit to escrow—usually either by wire transfer or personal check. It will be cashed almost immediately and held in an escrow account. This three percent is part of whatever down payment you agreed to make on the property during the negotiation process. If you offered to put 20 percent down, you will have 17 percent due to close the deal. This three percent is what says “I’m serious about purchasing this property.” Provided you negotiate in good faith and perform as required by the purchase agreement, it is fully refundable should you decide to back out of the transaction (to a point). The escrow company—often selected by the seller, but not always—generates “escrow instructions,” which is the official direction they take based on all of the terms agreed upon in the purchase agreement between seller and buyer. They hold all funds, and no monies received by them can be released without mutual agreement from both sides of the sale. The typical escrow period is 30 days long, but that can vary, especially in today’s market where it can take much longer to get a loan locked in.

6. Inspections. This is also known as doing your due diligence. There are various inspections that you will want to do, at your cost, during your inspection period. At a minimum, you should have a general inspection done by a licensed and reputable inspector. You should always, always, always opt for a general inspection. This is not the time to cut corners. The inspector will do an overall top-to-bottom inspection of the property, and you can expect to pay anywhere from around $300 up to $500 or more depending on the size of the property. You’ll do well to remember that the inspector is not there to tell you what an amazing house you’re getting, or what great condition it’s in. Their job is to point out every little flaw or defect they see—it’s what you’re paying them for. Often, a lot of what they will note in their report is of little or no consequence, but there is always the chance that something major will come up.

Depending on what the general inspection turns up, you may need to call in specialists to further investigate potential issues, such as a mold inspector, a plumber, an electrician, etc. Doing proper inspections can save you huge money down the road, and it’s up to you to do your investigations into the condition of the house to your satisfaction. Most every home sale is intended to be “as-is,” meaning you shouldn’t expect the seller to deliver the property to you in like-new condition. It does not, however, preclude you from taking what you learned and attempting to negotiate repairs or credits based on the inspection reports.

7. Negotiating Credits/Repairs. You thought you were done when you negotiated your purchase price, didn’t you? Not so fast! Now’s the time when we take what we learned about the house during your inspections and decide what you can live with and what’s not acceptable. As I mentioned above, often during inspections, some expensive issues can be uncovered that someone is going to be on the hook for. Ideally, it’s not you. However, depending on a lot of things, you may have to accept the fact that you will be making at least some repairs on your new home. After all, it’s (most likely) not new construction. Let’s say, for example, your chimney inspection uncovers major damage to the chimney, and you have an estimate for $8,000 to repair it. Unless that defect was disclosed to you up front, you made your offer assuming the chimney was in good working condition (it’s possible the seller didn’t even know about the issue when they priced the house). Now you have grounds to issue a request for the seller to give you a credit for some or all of the cost to repair it (or request that they have it repaired themselves).

One of a few things will come of this request. First, they might agree to credit you the entire amount you requested for the repair. Or they might tell you to take a long walk off a short pier—that the home is in fact being sold “as is.” Finally, they might respond with an agreement to give you partial credit. This is the most likely scenario in my experience.

At this point, you’ll decide whether you’re satisfied with the outcome of your request and whether you want to move on and commit to closing the sale. From here on, there’s pretty much no looking back, and you’re all in. Next issue, I’ll wrap it up and take you through the closing, and we’ll have the keys in your hands by the time I’m done! Til then, if you or anyone you know are considering buying or selling a home, please don’t hesitate to call me for a free consultation and/or market value analysis of your home.

Jefferson Hendrick is an L.A.-based Realtor with Keller Williams. Contact him with questions, concerns and real estate inquiries at jefferson@kw.com or facebook.com/jeffersonhendrickrealtor.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on December 20th, 2010.

This is typically that time of year when many of us sit down, assess where we are, where we’re going and where we hope to be in another 365 days. As a Realtor, I know a lot of people who are really starting to get that this is the time to get into the market. And from an investment standpoint, I’m getting a lot of first-time buyers who are deciding that it’s now safe to park your money in the real estate market again. Many have $10, $20, $30,000 they’ve saved up for a down payment, and they’re ready for their piece of the pie. They have not, however, been through the process of a real estate purchase before and have no idea what to expect. It can seem a bit daunting to many, but it’s really not. As someone who works frequently with first-time buyers, I make every effort to spell out from the very beginning what the process looks like.

1. Get pre-approved. Nothing happens without pre-approval. It’s very simple, fairly quick and largely painless. You’ll need to find a mortgage broker or direct lender. This can either be by referral from friends who have purchased before, or your Realtor can make some recommendations. If anyone knows who ‘gets it done’ and who doesn’t, it’s them. Don’t be afraid to shop around, though. For the most part you’ll get the same rate from one to the next, but see who can give you the best deal, offer free appraisal, etc. It’s also important for you to see who you jive with best. You might get a better feeling from one than another. To get started, all they’ll need from you is some basic information like name, address, date of birth, social security number (to pull your credit), employer, years employed, your salary and some information on your assets. You’ll talk about how much you are able to put down, how much you can afford a month, etc. Once this is done, you and your agent will have an idea of what price range you should be looking in. Until that’s done, viewing property is kind of pointless. You won’t be able to make an offer on something til you’re pre-approved, and the last thing you want is to find the home of your dreams and lose it because you haven’t gotten your ducks in a row.

2. Find yourself a buyer’s agent. Sometimes you may have done this step first, which is fine. But whatever you do, get yourself a buyer’s agent. It doesn’t cost you a dime (they are paid by the seller of the home you will eventually purchase). You will have much better access to new listings, pocket listings (homes being marketed privately and quietly) and upcoming listings not yet on the market. It’s not the best idea to try to deal directly with listing agents, as they have already signed a contract to work in the best interest of the seller. Though it’s legal and can be done ethically and fairly, it can still present a conflict of interest. Get your own agent whose sole job is to fight for your interests and your interests only. Again, friends or co-workers are a great source of referrals. And as with lenders, don’t be afraid to interview a few people. They’ll be interviewing you too (indirectly), and the hope is that you mesh well and feel you can work as a team to achieve your goals.

3. Ready, set, go! Now’s the fun part—looking for the property. It can get exhausting after a while, especially if you aren’t finding anything you like. Thankfully your agent and the internet are both useful tools for weeding out the junk and finding homes that have real potential. A list of priorities is always helpful. What is a must in your new home? What can you live without? Be flexible—that list should be fluid and dynamic as you begin to educate yourself on what your money will get you. A good buyers agent will have previewed many of the listings currently on the market as well. Your agent won’t always be available to go with you, though, and Sundays are the best day for you to get out and see what’s out there and get some perspective on what you can expect to get in your price range.

4. Time to make an offer. Once you find the house or condo you love, it’s time to make an offer. What you’ll offer depends on many things—how long it’s been listed, what the comparable sales are in the area, how much interest there currently is in the property, etc. What the value of the property does not depend on is how you “feel” it should be priced or how much you like it. Your agent will help you formulate the best plan of attack. A standard purchase agreement is eight pages long and—for a first-time buyer—should take between 30-60 minutes to go through, depending on how in depth you’d like it explained. I like to give my buyers a blank purchase agreement as soon as we start working together so they can read over it, get an idea what they’re signing and know in advance what questions they might have. Once your agent submits your offer to the listing agent, you can probably expect a round or two of counter offers before everyone feels like they got what they wanted. There might be some negotiation of terms, escrow period (customarily escrow is 30 days, though that certainly can vary depending on many things) and contingency periods.

Once your offer is accepted, you “open escrow.” In the next issue, I’ll discuss what happens during the escrow period.

Jefferson Hendrick is an L.A.-based Realtor with Keller Williams. Contact him with questions, concerns and real estate inquiries at jefferson@kw.com or facebook.com/jeffersonhendrickrealtor.

The following is a reprint of my column that appears in the current issue of Frontiers In L.A. magazine.

With the holidays here and everyone offering up their own gift ideas, I thought I would do the same right here in my column. Why not, right? If you haven’t rounded up a sugar daddy, or someone equally capable of wrapping a big giant bow around a house, you best get to steppin’, because I have something for you in several price ranges.

For the one you have a mild crush on

Were you all excited about Hancock Lofts but weren’t falling for the $900-per-square-foot price (don’t feel bad, few did). Well, after almost two years of sitting vacant, West Hollywood’s favorite ghost town has finally gone rental. The building originally came onto the market with prices ranging from $895,000 for a 1,037 square foot unit all the way up to $1,459,000 for a 1,459 square foot unit back in mid-2009. The developer eventually took about half the units to auction this past April, ostensibly to get them up to 50 percent sold so they could begin closing escrow. Even the auction was a failure and did not net them the results they had hoped for. So, for the boy who simply must be smack in the middle of everything, now’s your chance to live there. Though no official pricing has been released yet, rumors and speculation point to one-bedrooms ranging from $2,800-$3,400, with two-bedroom units ranging from $3,500-$5,800. I attempted to confirm those numbers with the people at Hancock Lofts but did not get a return call before press time. The complex has a great pool area with secluded cabanas, and who doesn’t love Tender Greens, which is located on the ground level.

For the one who loves pink

Have you ever dreamed of living the life of timeless Hollywood icon Angelyne? Then this is your lucky day. It just so happens that the original pink lady has put her Malibu condo on the market at the low, low price of $575,000. As I’m sure everyone is aware, Miss Angelyne was the pioneer of self-promotion and being famous simply for being famous, and she did it so well! No doubt you’ve seen her zipping around town in her pink Corvette with her “ANGELYNE” license plate. The condo has three bedrooms and four bathrooms in 1,810 square feet. Now let me tell you, $575,000 seems pretty reasonable for a condo in the ‘Bu, but this one is gonna need some work (so says the listing). The building was constructed in 1987 and the unit looks fairly original, only pinker.

For the one with a Saudi prince or Warren Buffett for a sugar daddy

You’ve driven by it a hundred times if at all—9577 Sunset Blvd. in Beverly Hills. It’s a gargantuan mansion that “reflects a rigorous adherence to French Palladian and American Beaux Arts architecture that is unmatched today” (according to the home’s website, 9577sunsetblvd.com). The home measures an astounding 35,000 square feet of living space, which includes nine bedrooms and 13 baths. Inside, imported french chandeliers and sconces, 24-karat gold gilding, hand-picked marble flooring and double-marble staircase. The master suite consists of a 1,000-square-foot bedroom plus his and hers dressing areas, his and hers baths, his and hers offices and separate sitting rooms that open to an outdoor terrace overlooking the pool and tennis court. The home also includes an elevator, motor court and subterranean parking for eight vehicles. On the lower, underground level, there are staff quarters, a large craft room and a gym with steam shower, sauna and Jacuzzi. The gold-plated front doorknobs weigh 15 pounds each.

The home had been custom built by businessman C. Frederick Webha Sr. for himself and his family over a period of four years. The couple recently told the Los Angeles Times Business Journal that they felt it no longer made sense to live in such an ostentatious house in the kind of recession the U.S. is currently in. When the home was built, they had planned to host major political fundraising and charity events there.

For those of you—shall we way—of a certain age, you may recognize the address from back in the 1970s. The parcel this home sits on was part of a larger plot of land owned by a Saudi Sheik named Mohammed al-Fassi. Al-Fassi purchased the home that used to occupy that lot for $2.4 million cash in 1978. He immediately became a thorn in the side of his neighbors when he painted the house a shade of green that had been referred to by one critic as the color of rotting limes. To make matters worse, he painted all of the nude statues on the property in natural skin tones, and painted the hair and pubic areas as well to look more lifelike. The mansion became a stop for sightseers and caused traffic jams along Sunset Boulevard. It mysteriously burned in 1980.

There are three options for your holiday gift giving. If your price range falls somewhere in between that $575,000 and $68 million, please give me a call and I will be happy to help you find the perfect home at the right price. Enjoy the holidays.

Jefferson Hendrick is an L.A.-based Realtor with Keller Williams. Contact him with questions, concerns and real estate inquiries at jefferson@kw.com or facebook.com/jeffersonhendrickrealtor.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on September 28th, 2010

I’m about to make my first real estate purchase in the next couple of months in the South Bay. Aside from the actual purchase price of the home, what costs and expenses should I be prepared for in closing costs? —Rebecca, Manhattan Beach

Good question, Rebecca. Often buyers go into a purchase a bit blind to what they can expect as far as associated costs with purchasing a home. First, I’ll tell you what you don’t pay, which is your agent’s commission. That is a cost that comes from the Seller. Now on to what you can expect to pay on your side.

As a rule of thumb, you can usually count on closing costs of around two to three percent of the purchase price of the property, give or take. The majority of your costs come from one of two sources—the lender or the escrow company—and you’ll see all of the costs broken down on a form that the lender provides at the end of the transaction called a HUD-1 (or Settlement Statement). When you first enter escrow, the lender should provide you with a Good Faith Estimate (GFE) of your closing costs.

Sometimes you can request a credit from the seller to be applied to your closing costs, reducing the amount you have to bring to the table. This is especially helpful to first time buyers working with limited funds. Some of the major expenses you will be expected to cover include:

• Lender Fees. These are fees the lender charges for their services, including processing the loan, underwriting, generating loan docs, appraisal, tax service, etc. Expect fees of anywhere from $1,500 to $2,500. Most often, this is where you might be able to do some negotiating to get some fees reduced or dropped altogether. It never hurts to try.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on September 14th, 2010

I’ve been thinking about listing my house for about a year now. I’ve considered several different options, from ‘For Sale By Owner’ to a discount brokerage that just lists it in the MLS, to full-service brokerage that will handle everything for me. With your being an agent, I feel like I know which way you’ll point me, but can you give me, in your opinion, the pros and cons of each?
—Hunter, West Hollywood

Hi, Hunter. As an agent, when I’m giving a listing presentation, I’m often asked this question. Let me say first, of course I get why someone would want to sell their home off the grid and save the commission money that would ordinarily go to an agent, I really do. And when I’m asked, I lay the facts out and let the seller decide. I do occasionally lose a seller who decides to FSBO. However, of those, many end up calling me after they’ve tried it and not gotten desired results.  

First, let’s break down the duties and benefits of a real estate agent (or Realtor if they are a member of the Realtor trade organization). An agent goes through extensive training and ongoing education to be able to sell your home or represent you in a purchase. Your Realtor will help you set an asking price, market the property thoroughly and will help you prepare the home for sale. They’ll also make recommendations for minor improvements and repairs, screen buyers, prepare all paperwork and disclosures and handle negotiations both during the offer process and the inspection process.

The typical fee for a listing agent with a full-service brokerage is between five and six percent of the home’s final sales price. There are discount brokerages that will do it for anywhere from two to four percent. Typically these companies don’t perform all the marketing and other services of full-service brokerage (but it varies from one company to another). When the market was white hot a few years ago and things were selling as soon as they hit the market, these companies were popping up everywhere. Now that we’ve transitioned into more of a buyer’s market, the pendulum has begun to swing more towards full service.

The pros of a FSBO should be obvious. No commissions to pay. If you can successfully get the home sold, that’s a lot of money you’ve saved. Statistically speaking, about 15 percent of the homes sold in the U.S. are sold by the owner. That said though, nine out of 10 owners who attempt a FSBO ultimately end up calling in an agent, usually for one of the following reasons: either it didn’t sell in the amount of time they’d hoped, they didn’t price it right so they got little activity or once they got started they realized they didn’t know all they needed to know about selling a home. There are a lot of disclosures that have to be provided, and a seller is put in a very vulnerable position legally by attempting to take this part on without professional help. Do you know how to pre-qualify a buyer?

Many sellers doing FSBOs do choose to open up their buyer pool significantly by paying a service to have their listing uploaded into the Multiple Listing Service, and do offer a commission to the agent who brings the buyer. Bear in mind that in that situation, you have a buyer who is being represented by a professional, leaving you to fend for and negotiate on your own behalf.

If you are considering a FSBO, you should be committed to the time it will take to get the home sold. Successfully selling a home is a full-time job. There will be the necessary marketing and advertising, fielding calls, facilitating showings, holding open houses, etc. And that’s before you’ve even seen an offer. By hiring a professional, you get to go about your daily routine and live your life while the agent handles everything. Very rarely is a homeowner savvy enough to know the value range for their home, and they often either underprice, leaving money on the table, give away the store in negotiating repairs or overprice, resulting in no offers.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on August 30th, 2010

I’ve been looking for a home to buy for a few months now, with no luck.  For now I’m looking on my own, but will hire a buyer’s agent when I get closer to finding what I want. A friend told me that I should check out short sales. What exactly is a short sale, and should I open myself up to considering them? —Sasha, Silver Lake

Oh Sasha. Sasha, Sasha, Sasha. Let me first address something you said in the first part of your question—that you aren’t working with a buyer’s agent. If you are serious about buying, that needs to change now. You do know that the services of a buyer’s agent are free to you, right? They are working on a basis contingent upon your finding a home and going through with the purchase. Their commission is paid by the seller of the property. Do yourself a huge favor and find a buyer’s agent (I can think of one!) to take some of the weight off of you. You have a job. You have a life. You have better things to do than sift through every junky listing that hits the MLS. Find yourself an agent you click with, educate them on what you’re looking for and let them do the grunt work. That way you’re getting 90 percent of the crap filtered out and only getting the cream of the crop. Plus, a good agent who keeps their ear to the ground has lots of contacts and gets information on upcoming listings from fellow agents before they hit the MLS.

The following is a reprint of my column that appeared in Frontiers In L.A. magazine on August 4th, 2010

I work with a lot of first-time buyers, in every price range. Some who can barely afford to get into the market, some who’ve suddenly hit it big and are dropping $2 million on their first home purchase. Regardless of price range though, I’m often faced with buyers who have unreal expectations of what they’re going to get for their money. “I thought it was a buyer’s market,” I’m often told by forlorn buyers with sad puppy dog eyes. Well, it is. That’s why this house is only $850,000. It was $1,250,000 four years ago.

The most common thing I’m faced with is a buyer who has all their ducks in a row, has a pre-approval with a reputable lender, has their down payment safely socked away, and is bright-eyed and bushy-tailed, ready to find that perfect home. Quite often, they find out quickly that the pool of properties on the market isn’t going to quite measure up to what they’d envisioned for themselves. They hoped to walk right into a two-bedroom, two-bath, top-floor unit in a three-year-old building in West Hollywood with a balcony (city views, please), laundry in the unit, hardwood floors, stainless steel appliances and walk-in closets, and snatch it right up, all for the low, low price of $375,000.

Here’s the thing you have to know though, especially entering the market at the lower end of the price range. First and foremost, the most wonderful, magical, incredible, pride inducing thing about purchasing a home is exactly that—you are purchasing a home! You are becoming a homeowner! You’re getting in the game (at a time better than any in the last decade almost) and realizing the American dream. The most important function this great feat will provide—after the roof over your head, of course—is as a stepping stone to the next, bigger, more fabulous purchase. Just as that one will be the stepping stone to the next one. Do you think everyone you know who lives in a big beautiful house just stepped right into it? Most likely not.

When you purchase a property, over the years it increases in value—more so if you make improvements. When you go to sell that one, you’re able to take the profit from that one and use it to make a bigger down payment on the next one. Obviously the last few years have not been ideal for those who’d hoped for that, but fingers crossed and god willing, we are returning to the days of property value increases, slowly but surely.

Don’t necessarily look at this first purchase as the place you’re going to spend the rest of your life. And don’t be afraid to do a little cosmetic work, especially on a condo. Find something in an area you like that hasn’t been updated for a while. Have some vision. Ask your realtor for advice on upgrades and improvements. About a year ago, my boyfriend decided that he was ready to take the plunge and buy a condo. We looked for months for him, and found nothing. We looked at some really bad places. Finally we found a little crapshack. But this crapshack was in an amazing building, on a fantastic street. It had awful navy blue carpet throughout (including the bathroom), ‘70s linoleum in the kitchen, ancient appliances, peach walls, popcorn ceilings, mirrors all over the place and reeked of something I don’t have words for. But the second he walked in—the second—he said (and I thought to myself) “This is it. This is the one.” We spent the three weeks after he bought it tearing it apart and putting it back together again. For about $3,000 we did what would have cost him $10,000-$12,000 if he’d hired someone to do it. Not only does he now have a sleek, modern pad he adores, but the place is worth a good $20,000 more than he paid for it. He just remodeled the bathroom, which certainly increased the value another chunk.

Whether it’s a condo or a single family residence, don’t be afraid of a little work. It’s infinitely better to fix a place up yourself, finish it exactly how you want it and reap the financial benefits yourself. It gives you instant equity. Keep in mind there are things you can do down the road once you bounce back from the initial expenses associated with the purchase. Think the kitchen’s ugly? So what? Does everything work? Does the house have good bones? It can wait.

Now that I’ve broken you down, let me build you back up, stronger, better, faster, smarter. I said it before and I’ll say it again. The fact that you are getting into the market means you’ve made it. You’re on your way. You’re building your future! Congratulations of the highest order to you. Just don’t feel like you have to have it all now. You might only get some of it right off the bat. You can make the rest happen!