As property prices are reaching lows unseen since 2003, prospective buyers who were waiting on the sidelines are now jumping into the market. The January single-family home median price was $350,000, a 24.7% drop from a year ago, while the condo median price was $190,000, a 48.4% drop.
Sales of existing single-family homes increased 21% in January 2009 compared to January 2008 in the San Fernando Valley, representing a total of 518 homes. In the meantime, condos increased 58.1% with a total of 166 condos sold.
However, as the demand for real estate is increasing, the supply of active listings is limited, and the number of properties receiving multiple offers is soaring, which may soon impact prices.
If you purchase a home before September 1, 2009 and you are a first time home-buyer (someone who has not purchased a home within the last 3 years, see http://www.hud.gov/offices/hsg/sfh/ref/sfhp3-02.cfm for exact details) you will be eligible to receive a tax credit for $7,500 which does not have to be repayed. The previous stimulus bill had the tax credit listed as a repayable interest free loan for 15 years. However, there are income limits that disqualify 1st time homebuyers to receive the credit for those single home purchasers who make more than $95,000 in adjusted gross income and $170,000 for married couples who file jointly.
Here are several articles explaining the 2008 sales data, how we may be at the bottom the market's down cycle and why prices may increase soon. As I've said in many of my earlier blogs, multiple offers are being received on almost every listed property priced below $500k with some listing agents seeing 10 or more offers. Buying activity from my clients has surged. Homes for sale (especially foreclosures priced under market value) are selling above list price. Many buyers are taking advantage of extremely low interest rates and pricing which have made owning a home even more affordable. These factors coupled with the after tax benefits of being able to deduct mortgage interest and property tax, monthly payments on a home are close to and in many cases equivalent to renting a home.
Click the following links to view articles supporting the opinion that we may be at the bottom:
LA Ranks #7 on Forbes List on World's Best Places For Real Estate Buys
Here's an article from the Southland Regional Association of Realtors showing significant increases in the number of sales from last year. Could this mean that the bottom is near? Read below and let me know what you think?
San Fernando Valley Home Sales Surge from Last Year's Low Point
Driven by foreclosures and homes sold by traditional sellers at favorable prices, sales of existing single-family homes in the San Fernando Valley during September soared a whopping 81.8 percent compared to a year ago, the Southland Regional Association of Realtors® reported.
A total of 658 homes changed owners last month - 296 sales higher than in September 2007. Home sales have been steadily increasing since a year ago September - which set a record low of 323 sales -with this September posting the fifth consecutive month with the total at 650 sales or higher.
"Recovery of the local housing market is underway," said Mary Funk, president of the Southland Regional Association of Realtors. "Every time a foreclosed home finds a new owner or a buyer expresses confidence by buying a home from a traditional seller, we move a step closer to resolving the housing crisis and returning to some level of normalcy.
"Even as some home owners still struggle with the excesses of the past," Funk said, "once-in-a-lifetime opportunities to buy are available now or will soon emerge. Yes, it's more difficult to get a loan today, yet there are many programs available or emerging that are designed to aid current owners and help prospective buyers get into a home. No one knows how long these favorable conditions will be around."
It is to early to predict whether rescue efforts from the nation's capital will prolong or speed recovery, Funk said.
Funk and Jim Link, the Association's chief executive officers, said they expected foreclosed properties to continue to be dominant factor in the market, yet both expressed confidence that the worst of the fallout from the financial meltdown has passed.
"Recent sales activity and the number of properties that are already in escrow suggest that the market has hit bottom and is bouncing back," Link said. "Buyers want to take advantage of the relatively few properties listed for sale and capture prices that have not been seen in years." Buyers generally have been focusing on unique opportunities to purchase single-family homes, simply because homes that were too expensive two years ago now may be within reach.
Still, condominium sales also increased during September, soaring 36.1 percent to 21 1 transactions - 56 sales higher than a year ago.
September marked the third time in four months that condo sales exceeded the 200-transaction benchmark after stumbling along below 200 for 10 consecutive months with the 105 condo sales of this January being the low point of this cycle.
"There's no doubt that sales are being driven by favorable prices," Funk said. "Plus, a purchase today indicates that buyers realize that housing remains a relatively rare commodity in Southern California, which is expected to add tens of thousands of new residents over the coming years."
The median price of single-family homes sold during September declined 37.1 percent from a year ago to a median of $392,500. It was the first time since 2003 that the median dipped below $400,000.
Likewise, the condo median price of $260,000 dropped 33.3 percent - $1 30,000 lower than a year ago. September marked the fifth consecutive month that the condo median has been below $300,000. Today's median condo price was last seen in 2003 and early 2004.
Pending sales - a measure of future closed escrow activity - increased an incredible 163.1 percent during September. The Association reported a total of 1,305 open escrows at the end of the month. That compares to 496 year ago - one of the lowest tallies in recent years and close to the record low of 385 pending escrows posted in December 1991.
"Generally, people are surprised to learn that there is a relatively limited inventory of properties listed for sale throughout the San Fernando Valley," Link said. "Owners realize that this is not the time to test the market.
"That leaves two types of sellers," Link said, "both of whom are highly motivated: banks holding foreclosed properties and traditional sellers who either must sell due to personal circumstances, such as a work transfer, or owners who have sufficient equity in their current property and understand that whatever the perceived loss in a sale will be more than recaptured when they buy a replacement property."
There were a total of 6,009 properties listed for sale at the end of September, down 22.2 percent from a year ago.
At the current pace of sales, that represents a 6.9-month supply, only slightly on the high end of the 5- to 6-month supply which real estate experts believe indicates a balanced market. The inventory at the current pace of sales was at a 16.2-month supply this January when there were 6,928 properties for sale and a mere 428 total sales.
For comparison, during the housing downturn of the 1990s the inventory soared to a record high of 14,976 in July 1992 and the inventory at the then current pace of sales hit a high of 23.0-months.
For more information please visit www.MarkSellsLA.com Written by Mark Gonzales Copyright 2008 Mark Gonzales, Realtor, real estate agent specializing in marketing and selling residential homes, condos, and commercial real estate sales in Los Angeles, San Fernando Valley, Woodland Hills, Sherman Oaks, Studio City, Encino, Tarzana, Calabasas. Please visit www.MarkSellsLA.com for more information.
Although the newspapers and Wall Street is flooded with depressing information on the economy, and despite Dow Jones record lows as well as the recent news that the government will not be buying up bad debts from banks, there are still multiple opportunities in the Real Estate Market for buyers who hold a decent fico score and can validate their current income. This means that many buyers are still finding foreclosure and short sale deals well under the market value compared to 2005. To help buyers buy these properties, several programs have been created to help buyers qualify and receive funding from banks.
This is a recent article by the Southern Regional Association of Realtors which lists the different programs available to buyers today.
Unique Homebuying Opportunities Abound
Regardless of market conditions, an opportunity always exists in the residential real estate market. That tried and true maxim is particularly accurate today as aid programs appear that are designed to steady the residential housing market and reopen the doors of home ownership to a wide range or prospective buyers.
Even as some home owners still struggle with the excesses of the past, once-in-a-lifetime opportunities to buy are available now or will soon emerge. No one knows how long these special programs will be available.
Remember, prices are at an all-time low. Interest rates are favorable. Lenders are making loans, albeit at higher qualifying standards. And, while not excessive, the inventory of homes listed for sale offers a wide selection. That inventory contains attractively priced homes being sold through foreclosure proceedings along with many listed for sale by traditional sellers, which often can offer a quicker, easier sale at a more attractive price.
There is ongoing debate as to whether rescue efforts from the nation's capital will prolong or speed the recovery, but several points seem crystal clear:
Recovery is, in fact, underway. More assistance programs are likely to emerge in coming weeks. At some point in the not to distant future, today's buyers' market will fade and a golden opportunity to buy a home and invest for the future will pass.
This is a brief overview of just a few of the many aid programs designed to help first-time and repeat home buyers. A more detailed version of this story aid programs are available at www.srar.com.Contact your Realtor® for details.
Higher Loan Limits
The higher loan limit of $729,750 - due to be eliminates at the end of December - makes loans more affordable, especially in high-cost housing regions such as California.
FHA loans are back
FHA loans are back in force and are plentiful. In some instances the down payment required is as low as 3%. More than 20 percent of new loans are expected to have FHA financing.
Realtors offer $4,000 Grants
First-time home buyers who purchase a home in the San Fernando or Santa Clarita Valleys may be eligible to receive a $4,000 grant to ease the burden of closing costs. The grants are available from the Southland Regional Association of Realtors. For details, write via email to Rubenf@srar.com.
L.A.City and California Programs
An array of city and state programs are available to help low- to moderate-income buyers into a home. Many programs are aimed at first-time buyers, but repeat buyers are welcome, too, to get assistance with a down payment or closing costs.• The California Housing Finance Agency - CalHFA offers multiple programs to help families purchase a home. Call your Realtor today for details on these and a growing number of homebuying opportunities!
For more information please visit www.MarkSellsLA.com Written by Mark Gonzales Copyright 2008 Mark Gonzales, Realtor, real estate agent specializing in marketing and selling residential homes, condos, and commercial real estate sales in Los Angeles, San Fernando Valley, Woodland Hills, Sherman Oaks, Studio City, Encino, Tarzana, Calabasas. Please visit www.MarkSellsLA.com for more information.
Regardless of what you might have heard about the home buying market, the statistics in Southern California show that this is a great time to buy. First time buyers, investors, and even all cash buyers have found the current market conditions to make owning a home more affordable and easier than ever before. However, having sold Foreclosure and Short Sale properties much of the year, I have some tips to offer for those looking to purchase a home in the next few months.
Condominiums and Town-homes: While the inventory has increased on many of these desirable alternatives to the Single-Family home, there are a couple of things which you should keep in mind.
First, you should get as much information on the Home Owners Association (H.O.A.) as possible when you are in escrow on a Condo or Town-home. An experienced Buyer's Agent will ensure you receive H.O.A. disclosure documents and help you digest the disclosures. You should pay special attention to the financial statements of an H.O.A. Many of these properties are located in complexes who have struggling H.O.A.'s and low cash reserves. This will affect your ability to get a loan on these properties. In addition, it could be a signal that higher monthly dues and assessments are foreseeable in the future.
Second, try to get information on how many units are currently-owner occupied verses tenant-occupied. These statistics will affect your ability to get a loan as well. Complexes with more than 15-25 percent based upon which lender you use, are finding it difficult to secure a loan. These standards are changing on a daily basis so contact your lender and find out their specific requirements regarding condos and town-homes.
Short Sales: From homes built in the 50's to homes built in the 21st century, short sale homes have been coming onto the market as more and more people are faced with financial issues that make it difficult to pay their mortgages.
Homes that are classified as short sales, occur when the owners of such properties work with the banks to accept a lower amount than currently owed on the property. Such owners in a distressed situation as they can no longer afford to meet their mortgage obligations and opt to execute a short sale to avoid foreclosure as it is less detrimental to their credit. What today's buyer needs to understand about these Short Sale situations is that it is a very long process, but often times it is worth the wait. If you are currently in a situation which will allow you to wait 3-6 months before moving into or taking ownership of your new home, these short sale deals are right for you.
The important thing is this: Have a good understanding of what the bank is looking for in its returns before you place your offer! Often times these properties are listed far below market value in hopes to receive multiple offers. Look at the comparables, at the amount owed by the current owner, and then make an informed decision on what your purchase price should be. Trying to low-ball these properties will only result in your offer being rejected 3-6 months after you place your offer and it most cases can be a waste of time for all parties involved.
In all purchase situations you should work with a knowledgeable and experienced Realtor as they will be able to guide you through the process while protecting your best interests.
For more information please visit www.MarkSellsLA.com Written by Mark Gonzales Copyright 2008 Mark Gonzales, Realtor, real estate agent specializing in marketing and selling residential homes, condos, and commercial real estate sales in Los Angeles, San Fernando Valley, Woodland Hills, Sherman Oaks, Studio City, Encino, Tarzana, Calabasas. Please visit www.MarkSellsLA.com for more information.
The sales data for September has been released from Southland Regional Association of Realtors and to everyone's surprise the numbers are outstanding.
Existing single-family home sales in the San Fernando Valley dramatically increased 81.8 percent during September compared to a year ago. 658 homes sold to new buyers last month- 296 more homes sold that last year this same time.
The number of condo sales also saw an increase during September at 36.1 percent to 211 transactions 56 sales higher than a year ago.
This may signal that we are the bottom of the sharp decline in local real estate values that we have seen in the last 3 years. From personal experience I'm seeing much demand from Buyers as they recognize that pricing of homes are at affordable levels. While my Buyer clients who are actively writing offers see competition from other buyers who are looking take advantage of the opportunities that the local real estate market presents. I would say 90% of my sales have involved multiple offer situations. With that said, it may be still be too early to accurately predict, whether recovery will be slow or fast due to the fact that the details of the legislative efforts that aim to rescue homeowners are still being ironed out. Moral of the story is that if you are looking to buy a property, can comfortably afford the monthly payments, and have plan to live in the home for at least 5 years, you will most likely see appreciation in your home. The tax advantages in most cases afford homeowners monthly payments that are in some cases equivalent to renting. Most importantly you can take pride in saying you own your own home.For more information visit: http://www.srar.com/members/rronline/10-27-SFVsales.php
Looking for ideas for you and your family this October and November? Here are a few family fun activities happening in the valley. Hope to see you there!
Dia de los Muertos-Hollywood Forever Cemetery 6000 Santa Monica Blvd., Los Angeles. On November 1st from 4011p..m., the historic Hollywood Forever Cemetery will be transformed by the vibrant colors of the afterlife. Pay homage to the dearly departed when you join in the self-proclaimed "largest and most authentic Day of the Dead celebration," which features a costume procession with traditional Aztec blessings and regional musical-dance group dedications. The highlight is the evening concert for the beloved souls, plus theater performances, displays by local artisans, and traditional Mexican cuisine, all surrounded by altars. Admission is free, but Dia de los Muertos attire is strongly encouraged, so go crazy with the face paint. 323.447.0999 or http://www.ladyofthedead.com/
West Hollywood Halloween Costume Carnaval 8300 Santa Monica Blvd., West Hollywood. West Hollywood's Halloween festivities are not for the faint of heart. Free weeklong events lead up to the Costume Carnaval, which celebrates its 20th anniversary this year. The largest Halloween street party in the United States, spectators can expect extraordinary costumes, fabulous drag queens, and well over half a million revelers. 323.848.6400 or http://www.weho.org/
Calabasas Pumpkin Festival 3701 Lost Hills Road, Agoura Hills. Don't' just pick up your future jack-o-lantern at the supermarket-make an event out of it with the Calabasas Pumpkin Festival, a 2-day street fair featuring four stages of live music & entertainment, a karaoke contest with cash prizes, an "authentic" western town, pumpkin pie eating and seed spitting contests, pumpkin bowling, wildlife way station and pet adoptions, no to mention rides, games, tons of food, and a beer garden with pumpkin beer. Admission is free and the festival runs October 18 & 19 from 10a.m.-5 p.m. both days. 818.222.5680 or http://www.calabasaspumpkinfestival.com/
Nationally, the real estate market has been declining in most major cities. But what the general public and media fail to see is that real estate markets are local. Each city and areas within cities have different industries that fuel their local economies. As a result, appreciation rates vary tremendously across the country and in different zip codes and towns. The Los Angeles area has a well diversified economy with one industry that is unique and indigenious to the city; the Entertainment Industry. The Entertainment Industry offers executives, celebrities, and creative professionals high salaries that help increase median prices in the most desirable areas of the county. The Los Angeles County median price sales data for July 2008 proves that real estate markets are local. There were 20 areas in Los Angeles County where median prices rose in July 2008 from July 2007. The most notable area, Playa del Rey zip code 90293, tops the list for the highest gain in median sales price for July 2008 at 41.40% with a median price of $1,238,000. Other areas include, LA/Westwood zip code 90024, where the median price for properties sold in July 2008 was $1,791,000, an astounding 32.60% gain in value from July 2007. Beverly Hills zip codes 90210 and 90212 saw appreciation rates of 23.5% and 26% respectively. Malibu had median price gain of 18.3% and Pasadena zip code 91105 had a gain of 25.90%.
Please copy this link into a new browser to see the median home sales data for all cities and areas in Los Angeles county.
For more information please visit www.MarkSellsLA.com Written by Mark Gonzales Copyright 2008 Mark Gonzales, Realtor, real estate agent specializing in marketing and selling residential homes, condos, and commercial real estate sales in Los Angeles, San Fernando Valley, Woodland Hills, Sherman Oaks, Studio City, Encino, Tarzana, Calabasas. Please visit www.MarkSellsLA.com for more information.
National Association of Realtors (NAR) President Dick Gaylord sits down with NAR Chief Economist Lawrence Yun to discuss what is happening in the market and what REALTORS® can expect in the coming months. Click the video feed to see their thoughts on the future of the Real Estate Market in 2009.
For more information please visit www.MarkSellsLA.com Written by Mark Gonzales Copyright 2008 Mark Gonzales, Realtor, real estate agent specializing in marketing and selling residential homes, condos, and commercial real estate sales in Los Angeles, San Fernando Valley, Woodland Hills, Sherman Oaks, Studio City, Encino, Tarzana, Calabasas. Please visit www.MarkSellsLA.com for more information.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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