Kaye's Beach Cities Real Estate Info

South Bay-Beach Cities Real Estate: Short Sales Suck

2008-04-06T13:34:12Z

I had dinner with two very savvy real estate agents last night. These agents have been in the business for a long time and know their way around a short sale. They have listed and sold short sale properties. Neither of them will deal with short sales again.

I sympathize with them. I don't want to deal with short sales either. Banks have no idea how to process these types of sales. Nor do they have the staff to deal with them even if they knew what they were doing. It's a joke. I did a number of short sales in the 90's so this is familiar territory. Last month I closed a short sale after an arduous escrow that saw my buyers ready to bail. The lender would only communicate via fax and refused to take calls even from escrow.

Lenders are just plain stupid at this point. They will not talk to a listing agent who might be able to expedite the situation. They don't use e-mail. Many will only communicate by fax. They change personnel and phone numbers and don't give out new information. They will approve a sale and then change their mind two weeks later. They will try to stiff an agent on commission after they have approved the fee. I know of agents who wound up receiving no money after working for 2-6 months on one of these sales. They believe we should work for free because they made poor choices. Then they wonder why good agents will not work these types of sales. They have no clue about local real estate markets. Yesterday one of the agents had a bank suddenly decide to go to sale rather then approve the short sale because they "knew someone would buy the property at auction for more then the short sale".... talk about out of touch. <<CONTINUE>>

Closing Escrows.. Making Active Rain Work for You

2008-03-20T18:14:37Z

There are a number of reasons to like Active Rain. One of the perks of membership for me has been the relationships I've formed with other AR bloggers. A few weeks ago I finally closed an escrow on townhome in Redondo Beach, CA. I worked with the buyers for 9 months by the time the escrow closed. The buyers had found me through my blog. We had e-mailed a few times and I answered their questions about the South Bay real estate market. We started looking at property in May 2007. We looked at every property in their price range over the next 6 months to the point that even they began to question whether or not they were being too picky. The answer of course was Yes... but they had just gotten married and were still learning the art of marital compromise. During the 6 months of our property search I sent them the names of a number of lenders I was comfortable working with in my area. One of those names was Brian Brady... America's#1 Mortgage Broker.

The clients were very nice people but boy were they tough. They typified the "new" generation of buyer. Internet savvy and computer literate. They wanted information and answers immediately. There were no givens on this deal. They had both owned property in other parts of the country and the hardest thing for them was finding that real estate is local. It didn't matter how deals were done in other places.. what mattered was how they were done in CA. This is a very difficult concept for a lot of buyers who have purchased in other states. They were experienced homeowners... just not in California.

They found searching for a lender was as difficult as searching for a home. They had financed their other homes through their credit unions and didn't understand that using a credit union from another state was probably not a wise choice let alone a very practical one. They tried Internet brokers and traditional bank sites. Ultimately they kept coming back to Brian Brady's blog as the best source for the information they were seeking. About three weeks before they found the right property I managed to convince them they needed to be totally pre-approved to make an offer. They finally chose Brian as their lender.

In November of 2007 they found a great property in South Redondo about 3 blocks to the water. The property was a short sale that appeared to be a slam dunk until we got into the transaction. The seller was a former lender who thought he had the deal wired.. he didn't. There were a number of hurdles we had to cross to get this one closed.

Fortunately Brian was on top of things. We were able to submit the offer to the lender with full approval for the buyers subject to the appraisal and lender acceptance of the short sale. We waited and heard nothing for about three weeks when the lender suddenly demanded an appraisal within a few days. Brian decided to call on Mike Tarabotto of California Appraisal Solutions Corp as Mike was an AR guy and close to Redondo Beach. Mike scheduled an appraisal immediately. I can truthfully say that Mike submitted one of the best appraisals I have seen in many years. In fact the appraisal was so well done it included the name of the HOA president. I'm guessing that Mike's appraiser gave her my name and phone number at some point which proved to be of major importance later in the transaction.

After being in escrow for over 2 months with almost no communication from the lender and a seller who really didn't know what he was doing it was time for our side to get tough. After threatening to walk from the transaction after a seller bluff I managed to get the number for the person who was in charge of the file. I passed the information along to Brian who began calling them every few hours. I won't be able to "prove" Brian's calls were the catalyst to get this sale moving but about three days after he started calling we suddenly received a demand from the lender and could proceed.

I was incredibly impressed with Brian throughout the entire transaction.. he is a pro. However my approval became complete adoration when Brian drove from San Diego to Redondo Beach to sign the loan docs with the Buyers. WOW.... I haven't had a lender do that in 20 years. As it turned out there was a glitch in the paperwork and we would have been in real trouble if Brian had not been at the signing. As Brian and I were talking with the Buyers while waiting for paperwork... they told us that the reason they picked both of us was our blogs. They were very impressed with the information we offered and how quickly we responded to their questions.

Brian's latest blog on AR is about Justifying Your Fees . I can guarantee that after you work with Brian Brady he doesn't have to "justify" anything.. he earns every cent of his fee. Thanks Brian... I couldn't have done it without you!

100 years later ..J.P Morgan Saves the Day... Again

2008-03-18T02:49:41Z

Yesterday JP Morgan Chase literally pulled the rabbit out of the hat and picked up Bear Stearns for $2 a share and a little help from the FED. While it may be too soon to tell.. the hope is that keeping Bear Stearns out of bankruptcy may also keep the financial markets from collapsing. However like teenage boys with fast cars.. credit markets and banks just seem to keep making the same mistakes over and over.

This is not the first time J.P. Morgan and friends have bailed out the economy. Around the turn of the 20th Century John Pierpoint Morgan was the man who saved the US economy not once but twice in a manner very similar to yesterday's scenario.

In 1895 during the Panic of 1893 the economy was in big trouble. At the time we were a gold based monetary system and a run on gold certificates led to banks closing their doors when they ran out of gold. The US Treasury was in no better shape as it too was about out of gold. The country was facing bankruptcy. JP Morgan and a few friends stepped in and managed to get loans equalling $65 million in gold to save the country from bankruptcy and economic chaos.

The Panic of 1907 was also known as the Bank Panic as banks were failing on a daily basis after the Stock market tanked almost 50% due to over-expansion and speculation that led to a stock market crash in the spring of 1907. Money was tight with little liquidity in the market as credit markets panicked. Hmmmmm sounds very familiar... In October 1907 the market crashed again. This time the crash was because of the shenanigans of one company, the Knickerbocker Trust. The ripple effect from the crash of the Knickbocker Trust failure spread panic to most of the major banks in New York.

Once again , this time at the behest of the Treasury Secretary, J.P. Morgan stepped up to help resolve the crisis. Morgan organized a team to help redirect money between banks, obtain credit and he even bought stock of corporations he thought were sound to stop the panic. Within a few weeks the panic passed and the country averted another major crisis that may well have destroyed the country.

One of the major outcomes of the steps taken by J.P. Morgan was to establish the Federal Reserve Act of 1913 which created the Federal Reserve system that we know today. While I'm often critical of some of the FED policies I think the move they made yesterday with JPMorgan Chase about Bear Stearns was probably the right one. What I find interesting is how similar the situation was in 1907.. then it was one company, the Knickerbocker Trust, that precipitated a massive panic. Yesterday it could have been Bear Stearns that started a total panic. Maybe we do learn a few things from our past mistakes.

California Foreclosures: Send in the Clowns

2008-02-26T18:09:58Z

On the front page of the LA Times there is a story by Jonathan Peterson titled Aid on Home Loans Sought...that should scare every potential buyer along with every homeowner. If the Boys in Washington DC have their way they are going to bring the mortgage market to a grinding halt. These clowns want to pass a bill that would allow bankruptcy Judges to not only alter the interest rate and payment on a mortgage but the amount of the loan itself in an effort to "save" homeowners. What a bunch of garbage! While I feel for those who have lost their jobs, had medical problems or faced a death or divorce.. the fact is they are in the minority.

Most of the helpless homeowners the government wants to save never should have been allowed to buy a home in the first place. They had rotten credit and no financial resources. The house payment isn't their only debt problem. Most have huge credit card debt. They can't afford the payment and upkeep on a home with all their other debt. 90% of them will still lose the house no matter what the government does as they have little sense of financial responsibility. The only thing this little bill will do is make most lenders back out of the market. The few who stay will push up rates by 1.5-2% or more to cover future losses.

Think about it... who in their right mind would make a loan to anyone if it could be altered or foregiven by filing bankruptcy. The courts would be clogged by people filing bankruptcy to have their rates lowered and or the amount of the loan discharged. The only thing I have to say about Sen. Richard Durbin ( D-Ill.) and Majority Leader Henry Reid(D-Nev) is what a couple of twits.

The mortgage market isn't in enough of an uproar. Nope.. so these two have come up with a little program to literally destroy the entire industry. Makes you wonder if they ever get outside and see what is really happening in the world. It also makes you wonder just what those guys are smoking in the back room.

I know when Stephen Sondheim wrote A Little Night Music .. he probable didn't have these guys in mind... nevertheless the lyrics sure seem to fit.....Where are the clowns?...Quick, send in the clowns....Don't bother, they're here....

I don't know about you but I'll be firing off a letter to my representatives in both the House and Senate

California South Bay- Beach-Beach Cities: What's Up With Interest Rates

2008-02-09T12:04:48Z

If you are looking for a new loan to purchase a home in Manhattan Beach or one of the Beach Cities or if you want to refinance your existing loan; you may be wondering where rates are going in the next few weeks. If you have been hoping to get a little insight from the "experts" in the field you may be disappointed.

I just received Dan Green's The Mortgage Reports where he has posted a link to Bank Rate's Trend Report. I love it.. even the "experts" are uncertain about where rates are going...

Bank Rate Panel Views on Where Rates are Headed:
Up:38%

Down:31%

Unchanged:31%

In my Post wondering on is it time to buy I received the following comment from a reader...

Now why would anyone buy in this market that is clearly coming down, just because of interest rates? Interest rates always adjust, cost of houses are fixed.

It's a reasonable question and in a normal market, where nothing except price changes, it makes sense. However I knew from the comment that the person didn't understand my premise. The low rates over the last few years have been because of the FED slashing rates to banks. This is going to change. Inflation, not recession, may soon be the item of concern. Inflation means higher interest rates. The current market is similar to the market of the late 70's and early 80's not that of the 90's... a war that may be winding down, high energy prices, a credit market concerned with liquidity... all of these items shot interest rates up to 17%. Don't think it can't happen again.. it can. <<<CONTINUE>>>

It's Tuesday February 5, 2008...VOTE!

2008-02-05T10:22:31Z

If you are in one of the Super Tuesday states today is the day you get to exercise your right to vote. There are hundreds of countries all over the world where people are literally dying in order to vote. We are very fortunate to have a process that while driving most of us nuts actually works.

It doesn't matter what your preference for President.. what matters is that you have a choice. Headlines scream everyday about those who have no choice... or are dying because they made a choice.

In CA we have a few propositions that also need to be voted on. How you vote on these will determine some important issues... like term limits, community college fees and extending Indian gambling. In Redondo there is a huge school bond issue. These are all issues that deserve our attention. Your vote does matter.. remember when you lost the class election by one vote?

So just do it.... VOTE!

California South Bay-Beach Cities: Cramer Says It's Time to Buy a House

2008-02-04T21:34:23Z

Redondo Beach Homes under $800,000

Why are you waiting... Jim Cramer says it's time to buy a house ....so it must be time to buy!

Looks as if the recent FED cuts have really stirred the pot. Jim Cramer, who just a few months ago, was telling anyone within shouting distance that buying a house was a stupid move and everyone who owned one should sell.. fast.. has had a change of heart. Not only does Cramer think it might be a good time for the general public to buy a home but he may even do it himself... WOW!

For a change, Cramer may be on the right track... If you need to buy then now might be a good time. It is definitely the time to refinance if you have a loan that will reset within 2 years. OK..so just take a deep breath and wait a minute before you start to beat up on me... If you need or want to buy a home within the next six months you should really do some homework. There are more properties available in the entry level in the Beach Cities then at any time in the last few years.

Manhattan Beach:
There are 17 properties under $1,000,000... 9 homes and 8 townhomes/condos.

Hermosa Beach:
There are 20 properties under $1,000,000...10 homes and 10 townhomes/condos

Redondo Beach:

North Redondo:
There are 54 properties under $700,000...22 homes and 32 townhomes

South Redondo:
There are 49 properties under $800,000.. 7 homes, 22 townhomes and 20 condos

El Segundo:
There are 27 properties under $800,000... 9 homes and 18 townhomes/condos.

These are much higher numbers for affordable properties then we have seen in a long time. No these are not 3000 sq ft less then 10 years old but they are the types of properties that most buyers used to buy as a first home. They are starter homes.. homes that start you on the way to your dream home. It made a lot of sense then and it still does... buyers need to get away from the idea that their first home should be bigger and better then the one that was the dream home of their parents. This is what got a lot of people into a lot of trouble.

So why does Jim Cramer think this might be a good time to buy then wait for the mythical 50% decline in price.

<<<<CONTINUE>>>>

Manhattan Beach, CA: Price Reduced..3612 Poinsettia Open House Friday 12-2

2008-01-31T12:26:05Z

Manhattan Beach Trees: Broker and Public Open House 12-2pm Friday

Big Price Reduction......now $849,000

3612 Poinsettia.. Manhattan Beach California

Join me Friday February 1, 2008 at 3612 Poinsettia, Manhattan Beach from 12:00-2:00 pm . This is one of the lowest priced homes in the Tree section of Manhattan Beach. The home has been maintained and is in average plus shape but is original with no major upgrades. It is a sweet little home... 2 bedrooms, 1 bath 865 sqft on a 4640 sqft lot with a tree view. The home is priced at $929,500. 3612 Poinsettia.. Manhattan Beach California

Call me at (310) 721-7438 or e-mail me for more information on this home or others in the neighborhood.

Southern California Real Estate: Walking Away is Stupid

2008-01-29T21:35:55Z

Last week was quite a week with mortgages bouncing up and down in a matter of days while Wall Street and the financial community tried to decide if the FED move was good, bad or mediocre. All of us in the South Bay-Beach Cities were also trying to decide how this cut and further cuts would affect our local real estate market.

Amid all the breaking news there have been a couple of related stories that tell a lot about the current housing crisis and the mindset of many consumers. Peter Viles who writes the The LATimes real estate blog LALand posted an article about people who were just walking away from their homes. One comment from a person who labeled herself as Condoblue wound up as another post. It seems that Condoblue has a mortgage that is getting ready to go up and her property has lost value.. so instead of making her payment ( which she can do) she plans to buy another home and walk away from her current home because it's good business.

Meanwhile over at CBS ....60 Minutes offered a report Sunday titled House of Cards:The Mortgage Mess. After all the requisite chat about rotten loan brokers and poor helpless buyers Steve Kroft talked to Matt and Stephanie Valdez, who bought a condo that went down in value. Although they too can make the payments they are contemplating walking away from the property... because it doesn't make sense to them to make the payment when prices are going down.

To Condoblue and Mr and Mrs Valdez I have three words... Shame on you! Didn't your parents teach you anything about ethics and values. You made a deal with the bank.. they would give you the money and you would pay them back. I don't believe the bank held a gun to your head or threatened to break your kneecaps if you didn't sign on the dotted line. However Condoblue and Mr and Mrs Valdez believe that only means something if prices are going up. If prices go down it seems that all bets are off. It appears that the only time someone has to honor a commitment or a contract is when it suits them.

What I found even more appalling was the number of people who seem to agree with them. Of the 69 comments about Condoblue most didn't find anything wrong with her stance to skip out on the old lender while she lied to the new lender. On the 60 Minutes site there were over 200 responses to the story. Those who found walking away offensive and wrong are barely in the majority.

It may seem to many that walking away is a no- brainer.. like returning a shirt to Nordstrom or a TV to Costco. But while Nordstrom will still take just about anything back... Costco had to change their policy on electronic items as consumers took advantage of them.

Those of you who say Banks are rotten and justify not honoring a contract by saying the principle is different are not getting the big picture. If you can afford to make your payments and choose to walk away you are taking advantage of not only the lender but all of us. In the case of Condoblue you are also committing loan fraud on your future purchase. For those of you who agree with this I have one word... DUMB!

Do any of you really believe that banks are going to let a bunch of people who can afford their payments walk away from their obligations without a consequence. They may not pay that consequence but I guarantee you will. You think the liquidity problem is tough now.. just wait. Banks make loans and charge for them based on risk. As more people who are not in dire straights walk from their obligations the banks are going to charge those looking for a loan a hefty premium to make up for their losses.

In addition to the costs of borrowing there is another little matter that may have escaped all of you who think that massive foreclosures are peachy because you will be able to buy a house cheap. You might want to rethink that if you work as a teacher, civil servant or for any state or government agency because you like their retirement benefits. If you have a company pension plan or use your 401K to buy stocks it might be a good idea to not be so gleeful. Most pension funds and mutual stock funds have part of their portfolios in financial stocks. B of A and WAMU are publicly traded companies.. if they tank so does any of the stock held by investors. Your pension fund or mutual fund could be one of those investors. That just might affect your benefits.

It's one thing when a little kid does something bad and tries to blame his imaginary friend. It's quite another when an adult decides to take no responsibility for their actions and skip out on their obligations. Frankly I have zip, zero, nada sympathy for Condoblue, Mr and Mrs Valdez or any of the others who are financially capable of making their payments but believe that walking out on a contract is OK. Aside from the fact that you are incredibly immature... you are also twits.

I bought my current home in 1991 at the top of the market. I watched the price go down and down. Yet it never occurred to me to walk away from my home or stiff the lender. It was not an option for me or any of the rest of us who hung on to our homes during some very bad times. I signed a contract and made a commitment. I stuck to that commitment.

That's not to say I didn't believe that ultimately my home would be worth more then I had paid for it... I knew that even as the market was tanking. I knew values would come back. I had a down payment to protect and I wasn't going to walk away from that. Also my parents taught me to honor an obligation. If I gave my word I stood by that. I still believe that is the way to handle any situation business or personal.

So to all of you who are walking away from your homes because you think you only need to honor an obligation when it suits you... Bad behavior is bad behavior no matter how you try to justify it...

South Bay-Beach Cities: Conforming Loan Limits to Increase

2008-01-25T11:28:17Z

The House Republicans and Democrats with the approval of the Treasury have tentatively agreed to increase conforming loan limits to $625,000 from the current level of $417,000 as part of their economic stimulous package. The bill must still be approved by the Senate ans the White House before it becomes law. Speculation is that the bill will be signed and could impact loans as soon as February 15, 2008.

If the package goes through it would be a boost for the jumbo loan market and our South Bay-Beach Cities real estate market. The increase would be great for those who need to refinance and for many buying property at $900,000 or less. Loans up to $729,750 would get the same treatment as conforming loans of $417,000 or less now receive.. that is lower rates.

Brian Brady in a post this morning before the news from Washington hit the headlines thinks that rates may be headed higher instead of lower after The FED meets next week. He may be right.. if the markets don't like the FED cuts in the discount rates.. either too much or too little then the Bond market will be dicey.. and mortgage rates will be up for grabs. I know it's crazy but it's the market.

**** Looks as if the deal has been done and we can expect the president to sign as soon as it officially clears the Senate. BE AWARE.... These rates are only good for one year.. so if you need to refinance now is the time to do so... at least that's the story now...

Los Angeles County South Bay-Beach Cities, CA: Sold 2005-2007

2008-01-22T15:42:14Z

Classic Redondo Craftsman on the Avenues

There is no doubt that sales volume has declined from the peak of 2005. Prices, on the other hand, have increased in almost all areas and for all types of property in each of the Beach Cities. While 2007 was not a great year it was not as bad as many had predicted due to surprisingly strong sales in the first half of the year.

In August 2007 we saw the first hint of serious trouble within the financial community. Huge numbers of lenders have closed their doors because of losses from subprime loans. Lenders have supposedly revamped their requirements as Fannie Mae and Freddie Mac have restructured what they will buy and are putting a real premium on FICO scores with penalty points for those who have low scores.

While interest rates on conforming loans.. those under $417,000 are at one of the lowest levels in years.. jumbo loan rates continue on the high side. Lenders are claiming that the risk is too high and the cost(rates) must take risk into account... and who knows part of the statement is probably true. Wall Street is in real trouble and there is more to the problem then a few risky jumbo loans. My premise for that statement is that most areas of the country are still able to take advantage of conforming loan limits. It is only a few high priced markets that are dependent on jumbo loans... and surprisingly many of these markets are not in nearly as much trouble as their less pricey cousins.

Contrary to the thoughts and wishes of many our beach real estate markets have not crashed. Sales are slow but prices are holding up fairly well. The softest area seems to be townhomes in North Redondo which has always been less stable then other parts of our market area. North Redondo townhomes are our weakest segment and will be the first to be affected if there are a large number of foreclosures. so far we are not seeing the high numbers of foreclosures that were predicted. Rumors abound about lenders holding back massive inventories of foreclosed properties but I don't think we will see a lot of them here.

The biggest threat facing our market is if we wind up with a massive recession and people lose their jobs. The problems we saw in the 90's were because a large number of residents lost their jobs when the aerospace industry saw a loss of major government contracts with the end of the cold war. This time around we are a bit more diversified.. although I think settling the Writers' Strike would be a real boost to thoughts about our local economy.

These are the numbers for the Beach Cities... Manhattan, Hermosa, Redondo and El Segundo from January 2005- December 2007.
Beach Cities: Sold 2005-2007 (click on graph to enlarge)

Manhattan Beach, CA: Home Prices 2005-2007

2008-01-19T11:55:52Z

Manhattan Beach Pier.. January 2008

The Manhattan Beach real estate market has always been contrary.. contrary to logic... to income standards... to investment basics... basically to most yardsticks used to measure property values in other places. We have continued to maintain high prices even as the market has slowed down. The number of sales have decreased, the days on market have increased while prices have only seen slight declines.

The question floating through our Manhattan Beach community is whether or not this will be the year that we see the real estate market move downward or will we continue with minor adjustments and a basically flat market. Buyers are opting for prices moving downward while sellers are hoping to hang on with a flat market or a minimal downturn.

Manhattan Beach and the Beach Cities in general have fared better then many similar communities in Los Angeles County. So far our foreclosure rate is minimal and the hope is to keep it that way. I'll be posting information about the Beach Cities in the next few days.

Manhattan Beach: Home Prices Sold.. 2005-2006 (click on graph to enlarge)

When you review the numbers for each neighborhood over the last three years it's amazing how stable the market has actually been. That may be about to change if the tight credit market continues into most of next year.

The big surprise may be that buyers are going to be fine as most people who want to buy in today's market have to have stable finances, cash for a down payment and good credit. The ones who may wind up in trouble are those who bought with marginal resources. We could also see problems if a recession does materialize. I think we will have a handle on where the Manhattan Beach and the Beach Cities housing market is headed by spring to early summer. If we make it through the next 6 months intact we are likely over the worst.

Manhattan Beach, CA: Home Prices January-December 2000-2007 Part II

2008-01-10T13:06:52Z

Manhattan Beach Home Prices : DOM & Median Price...2000-2007 part II

The Manhattan Beach real estate market has been slow the last few months when compared to the first part of the year. The national credit crunch along with continued high prices and fears of a recession have created a lot of questions about the direction of housing in most of California, Los Angeles County and locally in the Beach Cities.

While working on Part I and Part II of this report one of the things I noted is that trends in the Manhattan Beach market seem to be far more stable then many realize. The market started going up in 2002 and while price levels have bounced around they have not showed any major declines. Sales volume is off but not drastically when compared to the last three years. The DOM(Days on Market) for December 2006, January 2007 and December 2007 are almost identical. The fact is the market will probably see more changes next year but the magnitude of those changes is the question no one can answer at this point. No one is even sure if we are or are not in a recession.

Manhattan Beach: DOM and Median Price January-June 2000-2007 ( click on graph to enlarge)

Manhattan Beach: DOM and Median Price July-December 2000-2007

Currently there are 87 homes for sale in Manhattan Beach, 20 homes in escrow( 2 since January 1, 2008) and 3 closed sales since January 1, 2008. I held Open Houses on Saturday and Sunday in the rain.. one in the tree section and one in the sand section. On Saturday I had 10 couples come through and Sunday saw about 15 people. Not earth shaking by any means but rather interesting considering the weather conditions.

If the R Word rears it's ugly head in the South Bay we could see some trouble. However as we are more economically diversified then in the 90's it may not have as large an effect as the loss of aerospace jobs did at that time. It looks as if pressure is coming to bear on those involved in the Writers' Strike and we may see some resolution in that field before too long. Those in the financial markets must be feeling a pinch but again there is no data on how many or who will be affected.

There are Manhattan Beach homes that have received NOD's ( notice of default) and some even appear headed toward foreclosure. What is surprising is the few (3) I have seen in the paper as headed toward auction are not on the market... so I'm guessing the owners may be securing financing as the homes are worth a lot more then the amount of the mortgages recorded against them. But people are funny so you never know. In the 90's I met a number of homeowners who did not deal with the reality of their financial situation.

Manhattan Beach, CA: Home Prices.January-December ..2000-2007.. Part I

2008-01-10T13:03:38Z

Manhattan Beach Home Prices 2000-2007 Part I

I've been compiling a lot of numbers in the last week on home prices in Manhattan Beach and the Beach Cities. Over the next two weeks I will be posting that information beginning with Manhattan Beach. The following information is based on the number of sales and the price per sqft for single family homes in Manhattan Beach from January 2000-December 2007.

Manhattan Beach: Home Prices January-June 2000-2007 ( click on graphs to enlarge)

Manhattan Beach: Home Prices July-December 2000-2007

One of the things I noticed is that the number of sales for 2005, 2006 and 2007 are fairly consistent from January-December with the exception of November 2007 when sales were half of previous sales in November for the last three years. The number of first quarter sales in 2007 was higher then in 2005 or 2006. The actual number of sales begins to move downward in the second quarter of 2007 with the largest decrease in May 2007 with 13 fewer sales but with the overall highest price per sqft of any month or year from 2000-2007. The third quarter of 2007 shows sales volume down from 2005 and 2006 but not as much as you might expect( with the exception of November) considering the overall financial problems and general housing market declines nationwide and in much of California.

Part II will be feature the Days on Market and Median Price for homes sold in Manhattan Beach from 2000-2007

California: How Much Trouble Are we Really In?

2008-01-08T21:52:49Z

I thought I would start the New Year with a few observations. The last week has seen the R word rear it's ugly head in most of the media. The problem with recessions is that you are usually in one before the smart guys have figured it out. I know a number of people who believe that all the signs for a recession are staring us in the face. Others tend to think that while the economy may be on the weak side.. it still has enough punch to keep things rolling along.. slower but still rolling.

I'm not sure how much difference a small recession is going to make in our area. Right now there are no signs of big trouble in the South Bay. That of course could change in about 20 minutes but for now we seem to be somewhat stable since our job sector diversified from being 90% aerospace oriented. The Writers strike has had an effect but as more and more companies make individual contracts with the Union and the major networks see continued falling revenue the strike may get settled sooner rather then later. No one in their right mind wants to see the actors or directors join the picket lines. Most of the people I know are fairly secure in their jobs.. or at least as much as one can be in today's economy.

However there are other areas of concern that may or may not lead to some serious future problems..

Oil is way higher then it should be mainly because every time some nitwit sneezes the price of oil shoots up. If we were smarter we would get our act together enough to come up with good alternative sources of energy and say phooey to the middle east. It's hard to eat oil or sand and we have an abundance of food. It's a thought..

Nationally the credit crunch continues...It looks as if Countrywide is in a lot more trouble then they want the public to know..but did anyone really think they were going to skate through the credit morass without problems. They made some very bad loans to people who could not afford them. They compounded that error by having a company president who literally raided the cookie jar to make sure he got his and to heck with the stockholders or the customers.

I don't know about others but I'm a wee bit tired of all these guys who take huge amounts of cash from their companies while the companies are in big trouble. A little personal responsibility could go a long way to help mitigate the public's perception of how much trouble the economy and the country is in.

I find it a bit disconcerting that the American Dialect Society chose subprime as 2007's Word of the Year. Personally I like bamboozle better.. it has a certain cachet.. but nobody asked me. The LA Times had an article on January 5, 2008.. Job Slump Latest Omen of Recession that posed a rather intriguing question.. namely why has the rather small number of subprime mortgages brought the financial markets to their knees. Subprime mortgages are a relatively small number of loans compared to the larger number of mortgages that are in good standing. No one seems to care if Bob , Steve, Cheryl, Jean and Pete pay their mortgages on time. Nope... everyone is concerned about Charley who shouldn't have had a loan in the first place.

There is a lot of talk about returning to economic basics about housing costs and home prices. Everyone making $70,000 in California, who can't buy a home, believes that prices will drop to 1990 levels. They also believe that the reason prices rose was greedy homeowners and slick real estate agents. No one wants to believe that prices rose because of cheap interest rates , a surge in demand and a lack of building of affordable homes in some place other then Palmdale. Interest rates are still cheap, there are still a lot of people who want to buy a home and we continue with our policies of NIMBY when it comes to affordable housing. I don't foresee a big enough drop in home prices to change the situation. As long as we refuse to allow density to increase we will have a high cost housing market. The LA City council wants to put a moratorium on building. Smart move in an area with little affordable housing.. limiting housing is certainly a good way to bring down home prices.

We are in an election year... so we can plan on hearing a lot of people who want to be elected promise a lot of things they can't produce. It might be time for us to take a serious look at those seeking our approval. I remember an interesting statement about elections.. you get the government you choose.. whether or not you vote... so maybe we should think about that. Voting is a privilege that many of us have forgotten to exercise. If you don't vote then you are allowing someone who did to choose for you. I think that's something we should all think about this year. There is a lot riding on this election.

California: Behind the Scenes..How to Make a Rose Parade Float

2007-12-31T18:54:27Z

Float Decorating for the 119th Tournment of Roses Parade January 1, 2008

This year marks 119th year of the Tournament of Roses Parade in Pasadena. If you have only seen the parade it's hard to realize just how spectacular the floats are or how much work goes into them...

My sister is here from Colorado with my nieces...so we decided to go see the Rose Parade floats being decorated. About 10 years ago I got to work on a float and it was so much fun. My family loved getting to see how the floats come together. If you have never gone I highly recommend the tour.

Happy New Year ... Here's to a Great 2008...

Manhattan Beach- Beach Cities: Christmas Eve Thoughts

2007-12-24T23:28:33Z

If you've been following the financial news the last few days... amid all the Holiday hoopla... the financial pages have been running articles pointing the finger of blame about the real estate crisis, continuing credit liquidity issues, plans for government bailouts for some homeowners, and today the plight of credit card companies who are seeing some major delinquencies by customers.

Now as I've noted before...I'm not a certified financial planner or an economist from a prestigious east coast university. But I do know a thing or two about the Southern California South Bay-Beach Cities real estate market and life in general.

It seems to me that many of the developing financial problems stem from a view by the financial community that higher rates are smart business. Yes.. I understand all about risk pricing of money. As an economic theory it sounds great and makes perfect sense... the higher the risk the higher the cost of money. I think this is a great theory when dealing with large corporations and major players on the financial scene. However sometimes what plays out in the boardrooms doesn't seem to work very well in Joe and Jane's living room.

Common sense should tell you that bumping up the interest rate on a loan made to a marginal buyer and being surprised when they default is just dumb. The same can be said about the rising problems with credit cards. If someone is having trouble making the payments on a card with a 10% rate what would make you think they can make the payment on a card when the rate rises to 30%. Some policies just don't make any sense. One of my favorites is the one offered by furniture companies.. buy now.. no payments for 2 years. In two years the furniture is history and so are the payments.

I know that they bump up prices for those who can pay to make up the difference just as they do for health insurance premiums. The problem is that this financial policy really doesn't work. Look at Levitz Furniture (can Wickes be far behind) and other similar companies that market to marginal consumers.

So here's a novel solution.. don't make loans or hand out credit cards to those who can't afford them. Stop extending huge lines of credit to marginal consumers. What is so difficult about this concept?

The truth is I have no sympathy for any of these companies who made loans or extended credit to consumers they knew would have a difficult, if not impossible time making the payments. Need money.. just sign up for our easy no-qualify home equity line of credit. We have all received hundreds of pre-approved credit cards in the mail.. sign here for $XXXX. People in trouble will grab at any form of a life line and these card offers and offers of credit seem like a life preserver to those drowning in financial problems.

You may be surprised to know that most financial problems are due to the loss of income, divorce or death in the family; not frivolous spending. Sure it's not too bright on the part of those who grab at the offers; but if they had more financial smarts they probably would not be in so much trouble in the first place. That said it is also not my responsibility to pay higher fees because companies make bad decisions.

I may sound like Scrooge on Christmas Eve but it's time for the financial community to do what they claim consumers don't do..... take responsibility for their actions.

FYI: Scott Burns has an interesting column in the Daily Breeze today. It is definitely worth a read.

South Bay-Beach Cities: November SOLD 2007

2007-12-21T01:50:26Z

Walk Street Hermosa Beach

Only 11 more days until the end of the year. Inventory is down in most of the beach cities. Much of that is due to the time of year. Many builders have taken homes off the market until after the first of the year in hopes buyers will be more receptive. Rates are bouncing around with jumbo loans still priced well above rates for conforming loans. But even at that rates are still at historic lows.

The market is slow.. not dead. Price doesn't seem to be as big a factor as perceived value. There are a number of homes selling in the high range in Manhattan Beach as well as small townhomes under $600,000 in North Redondo. South Redondo had a fairly good month while Manhattan Beach saw some really bad numbers.

We still have not been hit with a high number of foreclosures or even short sales. The Beach Cities seem to be holding their own much to the disappointment of many. I don't know what is on the horizon for next year. Some firmly believe we will be hit with a rash of re-sets in rates on adjustable loans that will bring the market down. But this has been the prediction for the last year and we still haven't seen much of a problem. So... as Scarlett used to say .. tomorrow is another day..

South Bay-Beach Cities: November SOLD 2007(click to enlarge)

South Bay-Beach Cities: October SOLD 2007

South Bay-Beach Cities: September SOLD 2007

South Bay-Beach Cities: August SOLD 2007

South Bay- Beach Cities: July Sold 2007

South Bay-Beach Cities: Sold June 2007

South Bay-Beach Cities: Sold May 2007

South Bay-Beach Cities: Sold April 2007

South Bay-Beach Cities: Sold March 2007

South Bay-Beach Cities: Sold February 2007

South Bay-Beach Cities: Sold January 2007

Arm Rate Freeze: Smoke and Mirrors?

2007-12-11T10:55:41Z

Last week I went to a Christmas party that featured a Magician. The gentleman was a close up illusionist. I was in the front row and was determined not to be tricked by his sleight of hand... not a chance. This guy was so good I didn't have a prayer. I thought I was following his every move but he was misdirecting my attention the entire time. It's one thing to see a little misdirection at a show that is supposed to be entertaining.. it's quite another to have the government try to pass it off as a solution to a serious problem.

Much has been written about the arm freeze to help homeowners who may go into foreclosure if their payments increase because of loan resets. The problem is that like the magic of a Master of Illusion.. I'm afraid our attention is being misdirected from the real problem.... Wall Street investors who continually demand removal of regulations that hamper their concept of business and profit.

Brian Brady when asked about who benefits from the rate freeze was very candid.. the program is more about saving lenders then homeowners. Some will say that by saving lenders from their stupidity we end up saving the economy and Harry and Susie Homeowner. I agree there is some truth to that theory but ultimately I don't think that's what will happen. Rather by saving lenders from facing their mistakes they just go on to make other equally poor choices because they know they will never be held responsible for their errors of judgment.

In the 1980's the Federal Government bailed out the Savings and Loans from their disastrous financial errors that began with commercial lending and eventually found their way into the residential market with the recession of the
90's. That bailout cost the American taxpayer Billions with a capital B. Deregulation along with the machinations of Michael Milken, the junk bond king, and his cohorts helped bring the economy to its knees. The cost was far in excess of the figure the government had calculated. The banks were saved but lessons were not learned by the banks or the Federal government. I suspect the same will happen with this fiasco.

The Arm Freeze basics:

Homeowners:
** The home is owner occupied
** You have a job
** Loan was originated between 1/1/05 and 7/31/07
** Your payments are current
** Your FICO score is under 660*
** The loan will reset between 1/1/08 and 7/31/10
** The value of the home is more than the mortgage amount
** If the loan resets you may default as you can't afford the higher payment.

Lenders:
** The program is voluntary not mandatory for lending institutions

If you read the basics of the program a few things stand out...... First it's a voluntary program not a mandated one for all lenders...... Second if you are already in trouble there will be no help. Third.... and this is the big one.. Your home can't be upside down in value.. that is.. it must be worth more then the mortgage amount.

Now I don't have an MBA in finance.. so maybe I'm missing something here.. but if home prices are falling in most major metro areas then just how many people can the voluntary program cover. My guess is not many... certainly a whole lot less then the numbers coming out of the administration. Supposedly there are 2 million foreclosures that have or will hit the market shortly. Projections about who the program will help depend on who is doing the talking. The administration says 1.5 million homeowners will be saved from foreclosure. The Center for Responsible Lending says maybe 145,00. I 'm more inclined to go with the low number.

The bottom line is about home values. If the home is worth more then the mortgage owed.. that is... there is equity... why wouldn't a homeowner refinance at a lower rate for a long fixed period. Or if the owner is really in trouble and the home has equity why not get out from under and sell the house. This is the course most people would take if they could. They don't because they can't. Prices have fallen in so many areas that most of those in trouble owe more then the market value of their home.... hence all the short sales and REO's.

There is another little glitch that isn't receiving a lot of attention. How many investors are going to go for changes in the return of investments they bought. These guys bought into funds based on a given return and they are not going to be happy with a lesser return then promised. If properties go into foreclosure that is a risk they take.. but having the government change the rules mid-stream may not go over too well.

Like everyone involved in the housing industry I'll be keeping an eye on the program.. but the truth is I don't see it actually getting off the ground or really helping anyone. The country would be better served by instituting enforceable regulations concerning lending practices and really going after those who profited from what is out and out fraud. Until the banking industry has to face up to the consequences of their actions we can continue to expect to see new little schemes in the future. If Congress and the administration really want to do something to deter future problems in the financial sector they need to make those responsible pay a very heavy price. Until there is a serious consequence to the shenanigans on Wall Street we will continue to be misdirected by illusions of grandeur.

Help for California Subprime Borrowers... Maybe?

Foreclosure: You Can't Always Walk Away

Beach Cities: So Where Are the Foreclosures?

Southern California Home Prices: Are We really in Trouble?

New Listing: 3511 Bayview Manhattan Beach, CA

2007-12-02T21:27:28Z

3511 Bayview...Manhattan Beach, CA... White Water Ocean Views

New listing in the Sand section of Manhattan Beach.. This charming duplex has unblockable whitewater views from the upper level. The property is on the west side of the street. The lot is 1747 sqft and the building has 1281 square feet.

The upper unit is a 2 bedroom 1 bath with a fireplace and absolutely stunning views from interior and deck. The lower unit is a studio with a full kitchen and 1 bath with nice views. There is a small deck and yard area. The building has three garage spaces and a laundry room.

This is a wonderful opportunity for an owner user who wants to build a magnificent home in the future. The zoning is MBR-3.

This property is priced to sell at $1,475,000

Join me at the Broker Open House Friday December 7, 2007 ......12:00-2:00 p.m.

Call (310) 721-7438 or e-mail for an appointment to view...

Manhattan Beach: New Listing Tree Section.. 3612 Poinsettia

Manhattan Beach: New Tree Section Listing...3612 Poinsettia

2007-11-28T13:30:40Z

New Listing in Manhattan Beach Tree Section ... 3612 Poinsettia

This is a sweet little house in the Trees. Nothing fancy... no granite or marble... just your basic 2 bedroom 1 bath home on a 40 x 116 lot. The home has been a rental but was well maintained by the owner. This is the perfect little starter.. live in it now and build a new home later.

The house sits on a slight hill.. new construction would have a view of the tree section. The house is close to Rosecrans but doesn't get much traffic noise. For an appointment to view contact Kaye.. (310) 721-7438

3612 Poinsettia, Manhattan Beach ....... Priced at lot value $957,500

California Foreclosures ... Stupidity or Greed

2007-11-24T13:23:27Z

After reading Lenn Harley's California Subprime Borrowers May Get Relief I found that my comments had turned into a post about our California foreclosure problem. We are going to see massive foreclosures in many areas throughout the state. In a post I wrote yesterday... Help for California Subprime Borrowers... Maybe... Maybe Not .... it may be that the Governor isn't quite telling the truth about his agreement with some of the state's lenders.

However even if these lenders are willing to help some borrowers we are still facing major problems in some areas because of poor judgment on the part of all parties... including borrowers. Sure some were suckered but many of those in trouble are there because they used their homes to finance a lifestyle they couldn't afford based on fantasy incomes they knew they didn't make. .

I'm guessing that Bill Nazur who commented on Lenn's post that the number of subprime loans was about 10%14% and the balance of foreclosures is more about financial irresponsibility and adjustable loan resets then fraud is probably right. While RealtyTrac likes to tout that almost everyone in California is in foreclosure it isn't true. What is true is that there are a lot of people with multiple loans in serious trouble in addition to those who stopped making payments after 8 months and are walking away. Here is something to think about....the housing problems in California could be a preview of the future in other areas of the country.

The California housing issues have a number of causes not the least of which is affordable housing. We need a minimum of 200,000 new units a year but rarely get much over 150,000 so we are negative in the available housing arena. We are built out in the most desirable areas meaning much of the new housing that is built is a 1.5-2 hour commute from the centers of employment.

The major areas of subprime foreclosures in CA are in those places where new homes were built and often the financing was provided by an in-house lender.... Riverside, San Bernardino, The Central Valley and Sacramento. When the cost of gas doubled consumers began to feel the pinch... add in mortgage payments that doubled or tripled along with the normal number of incidents of divorce, job loss, death etc and your have some very real problems. Suddenly no one can afford their home mortgages or the drive to their jobs.

Another pocket of foreclosure activity were those where lenders made loans to people who could not afford the payments. Many of these folks were illegal immigrants or legal immigrants who speak little English and relied upon a member of their ethnic community to help them buy a home. Sadly there are those who prey upon the less skilled members of a community.

Finally there were middle to upper middle income earners who believed that they were entitled to anything they wanted.. whether they could afford it or not. Saving for a home was not part of the agenda. They had no money and lousy credit and they bought the biggest home with the smallest payment they could find. No one wanted to start small and move up.. they wanted to just move up.

Cheap money combined with a sense of entitlement helped create the mess we are seeing all over.... this had disaster written all over it. Add to this mix a bunch of new REALTORS who didn't know squat but wanted to make big bucks along with their equally uninformed new lenders who also wanted to make big bucks and you have problems.

Truthfully, I'm not sure whether greed or lack of knowledge was the heaviest culprit in the current debacle.. but I do know that the situation must play out to the bitter end. You can't help most of these people because they will continue to do the same thing over and over. They have lousy credit for a reason. They don't have money for a reason. They make bad choices for a reason. The reason isn't the banks or bad agents or a loan that is resetting. The reason is that many have never had to take responsibility for their financial affairs. Some will learn and some won't .. that isn't the responsibility of the government.

We are always going to have higher property values in California because the best parts of the state are built out. If you want to live close to the cities of San Francisco, Los Angeles or San Diego you will pay a premium for the privilege. In fact as more and more communities enact NIMBY laws it's only going to get worse. Eventually we will reach a point where the middle class can't afford to buy in the better neighborhoods and will either have to be permanent renters or begin to reclaim inner city neighborhoods.

I suspect that many of the areas hit the hardest by foreclosures will take years to recover. At close to $3.75 a gallon for gas not too many foreclosures in the Inland Empire or other far flung neighborhoods are going to be high on buyers' lists as places to purchase no matter how low the price. Meanwhile the neighborhoods that are nearer to places of employment will see some neighborhoods hit by a number of foreclosures but they will ultimately rebound because of the location.

Many of the more affluent areas will be hit by foreclosures and short sales but most will not be in big trouble compared to other parts of the state. Ed Rybczynski's offering.. A Coin Only Has 2 Sides .. about his sister is right on. They may have purchased more house then was perhaps prudent but they can afford it. Contrary to many pundits there are a lot of people in California who make a lot of money and have good financial resources.

Only time will tell how badly the housing market will be affected in California. Some areas will certainly be clobbered while others will survive relatively intact although bruised and battered. To all of you making snide remarks about California.. learn from us or you may well be facing the same problems in the future.

Happy Thanksgiving....

2007-11-21T11:51:51Z

I confess that I love Fall and the Holidays. Thanksgiving has always been a time to be with friends and family. From the time I was a child this has been the time to reflect on the many things I am grateful for in my life... I would like to share a few of them with you......

Happy Thanksgiving....

California Beach Cities:Buying in a Buyers Market

2007-11-20T21:35:43Z

Buying in a Buyers Market... How to Buy The Home You Really Want.

I can hear you now.. "It's a buyers market and I'm a buyer.... what's so difficult"?.... It may surprise you but buying in this market may be a little tougher then you think . A Buyers market can be a harder market to maneuver in then a Sellers Market. I know this sounds crazy but it's true.

In a Sellers real estate market everyone knows where the market and prices are going... upward. You know you need to make a quick decision on a home you want. You know there will be a lot of competition. You know there will not be much inventory in any price range. The key is to try and outbid the other offers yet not go too crazy. It's all very nerve racking but everyone knows the rules of the game.

In a Buyers real estate market it isn't quite so easy. For one thing the rules are not always clear. Advice on buying a home is everywhere...no one should buy a house for at least 5 years anywhere.....the market is crashing and anyone who buys now will regret it when prices drop further...... soon ocean front property will be at 1990 levels if you just wait. What you may not realize is that a lot of the advice is being given by people who either can't afford to buy or who may never buy. You may be afraid that you might pay too much and wind up losing a lot of money or worse yet look foolish to your friends. Human nature tell us we want to talk about the deal we got on a house and how smart we were about the local real estate market. The problem is that while there are deals out there you may not recognize them immediately.

Another difficulty is that all real estate markets are local and some will fare better then others. In the current housing market there will be markets that go down, markets that go up and markets that go up and down and then are flat. Prices are softening and some areas are going to be in for a real blood bath but not everywhere. Home prices in Manhattan Beach may drop 10% while home prices in Palmdale will likely drop at least 50% because of the foreclosure problems in that area. They are not the same market and different rules will apply.

One of the things I've noticed when reading consumer blogs is that a lot of the people commenting on the local market don't live in the area.. some don't even live in the same state. Many buyers think that because the market has changed from a strong Seller market to a Buyer market the world is theirs .. so to speak. The media has distorted a lot of information to a point that buyers believe all they need is a little cash and a decent credit score and they can pretty much offer what they want and sellers will be begging to take their offers. A lot of buyers are sadly disappointed.

Certainly some sellers are unrealistic when it comes to the value of their home. I can think of a number of properties in the Beach Cities priced well over market value. They have been on the market a long time and may continue to be on the market even longer if their asking prices don't get more realistic. However there are also a number of homes that have come on the market priced at market value. These properties sold quickly.. often with multiple offers and sometimes over the list price. The difference is buyers perceived these properties to be at or slightly under market value.

Here are 3 tips for buying a home in a Buyers market:

1. Know Your Market: It doesn't matter what the market is like where your brother-in-law lives.. you need to know what is happening in your market. There is a big difference between a home that has sat at $ 1.9 for 7 months and is worth $1.5 and a home that comes on the market at $1.7 and could easily sell for slightly more. A 1600 sqft 3 bedroom 2 bath completely remodeled home in the Trees on a great street priced under $1.4 million is probably going to sell in 20 minutes. If you offer $1.2 because you know prices are going to drop drastically.. you will not be the new owner. Who made the right decision.. you may have to wait 5 years to get the answer.

The same is true in the North Redondo townhome market. Right now a 2 on a lot townhome in North Redondo with a private yard in good condition built prior to 2000 is not selling unless the price is below $790,000. Every property that has gone into escrow in the last 6 weeks has been $720,000-$785,000 because that is where the market finds value. Properties priced at that level are selling.. those over are sitting. If you only want to spend $675,000 and want a yard...look at the rear unit of a three on a lot. Know the market.

2. Be Realistic...Buy What You Can Afford: Wow.. this seems to make sense but it's surprising how many people don't do it. Too many buyers want to buy the home their parents finally ended up with rather then the one they started with. Buyers don't understand that they may be better off buying a small condo in Hermosa or Redondo then a new house in a marginal location. Your first home doesn't need to be 3000 sqft in the trees. Buy a starter home or townhome in North Redondo, Torrance or Holly Glen... build a little equity... then move up to a different home. It may take a few years to get to where you ultimately want to live but you won't be in trouble along the way.

3. Get Pre-Approved for a loan: You really need to know what your credit profile looks like to a lender. You may get 40 offers of credit a week from Cards 'r Us but that doesn't mean you qualify for a prime interest rate on a home loan. Sometimes there are mistakes on your credit that can take time to fix. You should have at least 10% and ideally 20% plus closing costs for a down payment. There are still a number of different loans that are available to consumers but the guidelines have gotten tougher in the last three months. You need a current evaluation of your financial picture. You may have qualified for $XXX in June but today you may only qualify for $XX. Interview a few lenders. Ask questions about fees and rates. There isn't a lot of difference in rates. If the market rate is 6.5% for the loan you need ... no one is going to give you the same loan for 5.5%. If it's too good to be true... it is too good to be true.

Finally... Find a Good Agent( you thought I would say something else?)..... Contrary to all the hype there are good agents out there. Part of your job is to find one. A good agent knows the market. A good agent will help you find the right house and will tell you the truth. You may not like what you hear but that's another story.

South Bay-Beach Cities: October SOLD 2007

2007-11-14T01:04:53Z

El Segundo Craftsman Home

As we enter into the 4th quarter sales are still very sluggish. Inventory is moving upward slowly... mainly because not much is selling and old overpriced inventory continues to sit. After some very slow months... townhomes in North Redondo are beginning to move as a number of units seem to have found the magic numbers to entice buyers. Townhomes in Manhattan Village also saw a surge in sales after sitting around for most of the late summer and fall.

Price doesn't seem to be the factor as much as perceived value. In Manhattan Beach and Hermosa Beach there are are a number of homes selling well over the $3.5 mark while others from $1.9- $2.5 seem to languish with no end in sight to their plight. There are a few foreclosures and short sales hitting the market but they don't seem to be generating any overwhelming urge to buy from most potential buyers. Buyers are looking for value and when they feel it is there they will purchase.. often finding themselves in a bidding war for the right property.

Interest rates are good and another rate reduction will probably happen in December at the next FED meeting. As is often the case at this time of year I'm seeing property quietly beginning to move. Townhomes with yards in North Redondo that have been on the market for months finally found buyers once the price went below $800,000. There are a few homes in the trees in Manhattan Beach beginning to move as are some of the homes east of Sepulveda in the Mira Costa area. Hermosa is seeing more homes selling.. especially in the Sand section. There is a lot of new construction and upgrading going on along the Strand in North Hermosa. South Redondo is finally seeing a pick up in sales in the townhome market. There are a number of pending sales in El Segundo that should close escrow before the end of the year.

Beach Cities: October SOLD 2007(click on graph to enlarge)

Sellers who want to close escrow by the end of the year are ready to deal. Meanwhile back in the Manhattan Beach tree section there are a number of homes that appear to be moving into the New Year at the same old price. A little advice... If it hasn't sold in a year at the existing price... it probably won't sell in the next 6 months at that price either.

South Bay-Beach Cities: September SOLD 2007