Sunday a.m. newspaper reading with New York Times' Gretchen Morgenson

Today's Sunday a.m. reading comes to us courtesy of the NY Times and their stellar regular columnist, Gretchen Morgenson.  Her article is entitled Some Bankers Never Learn and it's about the (new, not-so-improved) rise of risky low-down loans. Title and above should link. Ms. Morgenson talks about the Dodd-Frank bill and what it would mean to the mortgage market.  My favorite quote: "Basically, Wall Street would have to eat a bit of its own cooking."  The columnist comes out squarely on the side of requiring all mortgage loans to have 20% down.

Although it sounds great in theory, and I love Morgenson to pieces, I need to differ with her on this.  Where are people supposed to get that 20%?  Considering the economic client of the last few years, how would it be possible for any middle-class person to have saved that much unless they happen to be employed in a very few select industries? Or have tapped the Bank of Mom and Dad? Yes, zero-down loans are risky -- but can't we compromise and go with 5% down loans?  Unless we want to see our markets tank again?

Need a 4+3 in Burbank? 947 Cambridge is for sale

Although it's not on the multiple listing service yet, 947 Cambridge in Burbank is for sale.  This is a 4+3, about 2600 square feet (tax records say 3 beds, 2250 sf) in a divine neighborhood -- on the corner of Sunset Canyon, as a matter of fact.  I haven't been inside, but neighbors say it's very nice and has an added multi-generational advantage of having a handicapped bath downstairs.  I'm not sure what the price is yet, but I expect it will be in the high $700's to low $800's.  And did I mention Jefferson Elementary? And wonderful neighbors (not me)? And fireworks overhead on July 4?  I'll have more news as there is some, but if you know anybody looking for a decent-sized home in a great neighborhood with terrific schools, this might be it.

Coming soon! Aaroe Architectural Properties Division and website

I'm thrilled that my company, John Aaroe Group, will soon be launching an Architectural Properties Division and website.  Even if you're not in the market for an architecturally notable house, the site will have lots of fun educational tools about L.A. architecture.  These will include bios of notable L.A. architects, a link for all architecturally significant cities and neighborhoods, a link to all historic preservation overlay areas, and more. The company is also offering classes to its agents on Los Angeles architecture, and you can be sure I'm going to take them.  Keep checking www.aaroearchitectural.com -- the site should be coming soon.

More about open house thefts in the San Fernando Valley

Dang.  Here's more about recent open house thefts, courtesy of a colleague:

On Sunday, July 24 an agent from my office was holding an open house at one of my listings in Encino. At about 3:30 pm two women came in and immediately fell in love with the house. They claimed to be mother and daughter. The agent took them around the house together at first. They really seemed interested in seeing the closet space. The daughter then asked to use the toilet and then the mother and the agent went downstairs (the mother said she wanted to see the downstairs bedroom) the daughter returned to the master bedroom and stole jewelry from a jewelry chest. When the agent was downstairs with the older woman, the woman told her she had recently lost her husband and was now raising four children alone. She said she just recently sold her house in Beverly Hills and wanted to pay cash for the house. The agent realized that the daughter was absent for a while, and after the open house we learned from the seller that there was a theft of jewelry from the jewelry chest in the master bedroom. The owner of the house had strung together the drawers and secured the jewelry chest but the ties had been cut and all the drawers had been emptied. Neither one of the women was carrying a particularly large handbag. The younger woman stated she recently had a baby (appeared pregnant). We think that there must have been a concealed pouch under her “loose” blouse that she put all the jewelry in. The daughter is a petit brunette with long hair. The mother has long blond (bleached) hair , brown eyes, approximately 45-49 years old. They told the agent they were speaking Romanian.



Another agent at our company was holding an open house a couple of blocks away the same day. It seems like the same two women (or women part of this group) came in to the house. They were speaking a foreign language. The house was staged (nobody lives there), so they left quickly (realizing there was nothing to steal) but they managed to steal the agent’s cell phone. They told the agent a similar story….woman recently lost her husband, sold house in Beverly Hills, etc.

When I told this story to some other agents in our office, two agents remembered a very similar situation with two women who came through an open house of ours a few months ago. One was older, one was younger and appeared pregnant. They wanted to split up and one of them asked to see the closets. The two agents were holding the open house and followed them around so nothing was taken. The older woman gave the same story about losing her husband, selling her house in Beverly Hills and paying cash.

It seems as though there is a band of women (gypsies ?) going to open houses to steal. Their MO is to split up. One of them engages the agent sitting at the house pretending to be a real buyer while the other one does the stealing.

If anyone else had a similar theft please ask them to call us so we can let the LAPD detectives know.

That was fast. 2012 W. Verdugo Ave. is in escrow

I listed 2012 W. Verdugo in Burbank last week for $525,000.  It went on the multiple listing service on Monday.  By Wednesday night we had a great offer.  By Friday we had opened escrow.  By today we have three good backup offers.  Did I mention that it's a short sale?

I must have fielded at least 20 calls a day from Realtors, and at least 15 calls and emails a day from buyers. (Because it's a short sale, I can't represent both buyer and seller.)  The house was mobbed during showing hours.

What can we infer from this very fast activity? That the market is "back"? I wish. That it was priced too low? No -- with that amount of traffic, we should have had 20 offers.  That people really like mid-century architecture? Yes.  That people want to live in little Burbank, in spite of the fact that it's not exactly a bastion of hipness? Yes.  That people are more educated about short sales than they used to be? Yes. That...oh never mind. 

But the fun (and the work) is just beginning since it's a short sale, and I'll keep you all posted.  Did I mention that the 1st lending bank is BofA? MMMmmm, my favorite!

From today's L.A. Times: What it's like to lose your house

L.A. Times runs a regular "Postcards from the Recession" column.  Today, the column has a terrific, first-person article about what it's like to lose your home to foreclosure/short sale.  The title should link; if not, click here.  The writer, Kathy Gosnell Seiler, is a copy editor at the LAT.

Great new site: dumbagents.com

I just discovered www.dumbagents.com.  Hilarious oh-no-they-didn't listing pictures straight from the mls.

Open house thiefs

Got this email today; this is sad but has happened to all of us:

"Please be aware that there may be an individual or small group targeting open houses for valuables or checks. I have a client in Studio City that had a checkbook stolen during an open house that has resulted in thousands of dollars potentially lost by writing checks in CA and MN over the past week. As careful as we are during open houses, this is something to watch out for, especially if there are a number of people in a group. FYI, in this case we believe it to be a group of 3 women and the "main" client represented herself as "Michelle" who said she was an asst to a celeb previewing properties. Please pass this on to other agents you know so we can all keep an eye out."

I like to think my intuition is great and I can spot people who are up to no good.  (I'm always suspicious of teenagers in groups.)  But when this happened at a listing of mine six years ago, it was two adult men who pulled up in an expensive car just before we closed.  Another time, it was an eight-year-old girl who pocketed an iPod during a regular showing (she and her parents returned it). Most of us agents always caution our seller clients to remove money, jewelry and small collectibles from the property they're selling because we just can't be everywhere at once.  I also warn my clients not to hide their valuables in obvious places, such as top dresser drawers.

Rumor: Frankie Laine built and owned my listing in Burbank

Don't you love a little bit of Hollywood glamor? Especially when it's from the last century? I heard a rumor today from a senior Realtor who came to my brokers' open house at 2012 W. Verdugo in Burbank.  She tells me she thinks singer Frankie Laine built and owned the house.  If you did, thanks, Frankie!

Outstanding property of the week in Sherman Oaks

The picture is not good, but I had the rare pleasure of showing this 3-acre property yesterday at 15036 Marble in Sherman Oaks (listed for $1,700,000). That's right; three acres. With a house. And views to forever. On a private drive. Right in the heart of Los Angeles. I didn't know such a thing even existed.

The house is nice and has lots of wood accents. It's kind of 70's and probably any new owner would want to contemporize it. But the really special thing is the land. I thought I was in a hilly oak grove in Santa Ynez -- it seemed that private. The owner has put little outside features here and there like railroad-tie steps, hammocks and picnic tables. Although an owner could cut the top of the hill off and put a mansion up there, it would take a lot of engineering. Personally, I think the highest and best use of the property would be to leave the land as is --as your own personal Neverland. 

I promise to stop gushing and give you all my usually-jaundiced view of the local market soon.

2012 W. Verdugo, Burbank just listed at $525,000, rare mid-century 4+2+pool!

Looking for that rare mid-century at Burbank prices? Want style and substance? I just listed this Eichler-esqe 4 bedroom, 2 bath, 1955 sf. home with separate studio and pool. The many architectural features include an open-beam ceiling with loft, stand-alone wood-burning fireplace, brand new concrete counter tops and brand new glass block tile in the large, sunny kitchen. This unique beauty also has a master suite with pass-thru walk-in closet, 3 bedrooms downstairs plus bonus room, central heat and air, French doors to back, some new windows, glass block wall in bathroom, separate laundry room, large covered deck, fully-wired separate studio with window a/c, an entertainers patio which leads to the gorgeous pool and spa and much more. Even though this is on a busy street, it's a terrific neighborhood and is close to all, with outstanding Burbank public schools. It's a short sale, but I'll be using a professional negotiator, so I think this will go smoothly. See my website at JudyGraff.com for more pics and contact me for showing info.

Avast, ye landlubbers! The backstory on the Burbank backyard pirate ship

Finally, we all get to learn about the builders and owners of the Burbank backyard pirate ship.  I first blogged about the ship, Red Dragon's Revenge, about four years ago and CurbedLa.com picked up the story.  Since then, both this blog and Curbed have republished the photos. And now, Burbank Leader/Glendale News Press has the history! No link as of now, though; you'll have to get a hard copy of the paper.

The builder/owners on Angeleno street are Anne and Richard Lainhart, who "shared a love of all things scalawag and Renaissance." Richard built the ship with friends in the Angeleno street backyard. (You can't see this from the street; my pics were taken from the alley.)  City inspectors and most of the neighbors got onboard.  Richard is quoted in the article as saying that the ship is a work in progress.  It has a 27-foot mast, five sails and a below-deck galley and is dry-docked in concrete 14 feet deep.  It has held as many as 60 people for parties. 

According to the article, the Lainharts enjoy reenacting other historical eras, too, and are members of the L.A. area Sherlock Holmes society.  Lainharts, thanks so much for the delight you've brought us all. Long may the Red Dragon's Revenge sail the backyard seas of Burbank.

Don't buy this house

I wish I could publish an address or more details about the home I'm about to tell you about, but... It's a short sale in Sherman Oaks.  It is underpriced in the high $500's.  I know the history of this house, and the sellers, very well.  The sellers need to move on to other things in their lives, and want to sell it.  Here's the problem: the sellers have a ton of cash assets that they want to protect. And they are people of means. They actually could pay off the mortgage with very little problem. Will the lien holding bank allow them to walk away from the house without touching those assets? My favorite short sale negotiator says probably not.  Which would make for a long, difficult short sale transaction that probably wouldn't close.  Wish I could tell you more, but...

As we go forward in our distressed-sale market, I think you'll see a lot more of these types of short sale transactions happening, or trying to happen.  The keys to look for -- and avoid -- are this: homes in affluent or more expensive neighborhoods, no true hardship (job loss, serious illness, etc.).  The questions to ask are: how much is still owed on the loan? What is the sellers' motivation and what is their situation?  Stay tuned for yet more permutations in the wacky world of local real estate.

Coming next week: mid-century modern with 4 bedrooms in Burbank

More details to follow, but next week I will be listing a 4 bedroom, 2 bath home in the center of Burbank for $525,000.  It has a pool, loft and separate studio too! Want style galore? This one has mid-century features like open-beam ceiling, stand-alone fireplace, etc. plus the kitchen has just been redone.  Yes, it's a short sale, but we have a professional negotiator working with us on this.  I'll have it listed Monday and will have lots more details then.

A snake at yesterday's Burbank showing - real buyer or just lookie-loo?

Yesterday's showing of a Burbank hill estate was going very well until we came upon this visitor (shown in the photo above).  I don't know what kind of snake it was, but it was about six feet long.  Our reaction: first, we freaked out.  Then we all pulled out our cell phone cameras and began snapping away.  As the snake began to move closer to the house, listing agent Vangelis Korasidis offered him/her another property to view -- the inside of a green-waste bin.  It was nice and shady in there, and obviously offered the true ambiance the reptile was looking for in a home.  The snake went right in.  The stalwart Trent of Jennings Termite showed up to escort the snake off the premises, and in all the commotion, the snake decided it didn't really appreciate the neighborhood character.  It charged into the hillside bushes and wasn't seen again, which is probably a good thing as it did NOT appear to be a serious buyer.

Studio City is getting a movie theater once again. But...

Here's today's article from Studio City Patch re the new SC movie theater that will be opening up in the old Aura place.  Even though I like the idea of a movie "art house," this sounds kind of small. Somehow I just don't think this will steal much business from Arclight.

"South California" a 51st state? But it wouldn't include Los Angeles

According to today's L.A. Times, 13 California counties want to break away and form their own state.  It would be called "South California" and would NOT include Los Angeles, because L.A. is too liberal.  I say: fine, as long as we can still annex Disneyland. 

Luxe resort -- at private home in Encino?

Here's the fanciest house I saw this week -- and it's in the flatter part of Encino.  Looks like a resort, no? It's at 17941 Rancho and is listed for $1,299,000 (It's a short sale and according to listing agent, the gap between what's owed and the current value is $500,000.  Yikes!). It has 5 beds, 3 baths and 4172 square feet and currently is being used as a rental.  Of course, the house is lovely, it has a big built-out kitchen with high end appliances, etc. It also has a built-in many-thousand-dollar espresso machine.  Really? Do people like espresso that much? But anyway...

The really special feature is the backyard and pool.  It looks just like a  resort pool -- seriously, you'd think you were in Puerto Vallarta or at least Scottsdale.  As you can see, it has a waterfall.  And a big water slide.  And a swim-up bar.  There are 3 built-in barbecues, a regulation-something sports court, a backyard powder room, and a separate, private shower.  If you owned this house, it would almost be criminal NOT to entertain ALL THE TIME.  Too bad the city won't allow "day" resorts.  That certainly seems like it would be the highest and best use of this property.

Who pays the difference in a short sale? - A quiz

Let's quiz your short sale knowledge! As we all know, a short sale is when the owner/seller needs to sell the property and it is worth much less than what's owed on the mortgage.  The lender/bank/lien holder okays (or doesn't) a short sale, whereby they get less money.  But who pays the difference?
a.  Nobody.  The bank(s) just eat the difference.
b. The seller pays.
c.  The buyer pays.
d. Casey Anthony.
e. Harry Potter.
f. a., b., and c.
g. a. or b. pays some of the difference.
h. a. and c. pays some of the difference
i. Both g. and h.
Blind and/or bored yet? Give up?
The answer is i.  Either the banks eat the whole difference or come after the seller for "debt settlement" which is a portion of the difference.  Increasingly, sellers are saying no, they won't pay anything and they refuse to be on the hook for the difference in the future. Instead, they'll let the house go to foreclosure.  So who steps up, or doesn't? That's right, the buyer. And no, dear buyer, you usually can't tack on that contribution to your loan.

Not to make this too complicated, but some short sale negotiators anticipate such a thing and get closing costs for the buyer negotiated up front.  That way, if the secondary lender/lien holder comes back and wants to be paid off, there's already an amount of money sitting there that can be used for this purpose.  Got it? I know it's confusing.

If you're a buyer, and you're considering making an offer on a short sale, it's useful for you to know some details going in.  These include how much is owed to the banks and other lien holders (such as county taxes or home owners' associations).  It's also good to know how many other lien holders there are -- the less, the better.  It is also helpful to know if the seller has assets, as the more assets the seller has, the more likely the bank is to come after them.  And the more likely they are to turn to you, dear buyer.

1106 N. Cordova, Burbank closed today and here's how it went

1106 N. Cordova Street in Burbank closed escrow today.  We had two offers very quickly after putting it on the market at the end of May, and it sold over list price at $464,000. The transaction went very smoothly -- I wish all transactions could go this well!

Here's how we got offers over listing so quickly: 1) The sellers had the home expertly upgraded.  No, it wasn't a flip in the classic sense as the owners had lived there 17 years until they bought a bigger house last summer.  They spent some money, and it showed. 2) It was beautifully staged. (That's the living room, above.) I thought this was essential as the house was small and I knew furniture would make it look bigger.  I'll post a before-and-after video soon. 3) I marketed the hell out of this.

The inspection went pretty well as far as inspections go, although the water heater conked out and the sellers had to replace it. The buyer, her agent and his team were really on top of things and responded to everything in a reasonable, timely manner.  And we had a back-up offer.

However, there's pain in every escrow.  The only pain here was with the appraisal.  As I said in a previous post, the first appraisal came in low.  Even though the buyer was putting down a hefty sum, Wells Fargo balked.  The buyer changed lenders (Great Western), we had a second appraisal that came in to value, and the lender got the loan done in two weeks (!!!).  And everybody is happy!

I'll be doing a presentation on blogging...

Tomorrow, I'll be doing a brief presentation on blogging and social media conversion for my Sherman Oaks John Aaroe Group office.  Any suggestions? Be nice now.

Can't wait for Carmageddon? Enjoy a sneak preview and train your hurry-up-and-wait chops with...BURBAGEDDON!

Do you feel the need to practice up for Carmageddon on July 16-17?  Now you can...with Burbageddon! Thanks to its Party of the Century, all streets of downtown Burbank will be closed on July 8 from 10 a.m. to 8 p.m. for Burbank's centennial festivities.  How will those of us who need to get around, and through, the area in vehicles do so? Who cares! The sponsoring organization reports that it will be "A supersized festivity with flybys, parades, multiple stages, memorabilia, mascots, children's entertainers, stilt walkers, awesome food from Downtown Burbank restaurants, community booths and more, the Party of the Century will be the ultimate night on the town for kids and families alike. Encompassing six city blocks including San Fernando Boulevard, Palm Avenue, AMC Walkway, Orange Grove and Olive Avenue, it will express the civic pride and community spirit that have characterized Burbank’s first 100 years. Things will really heat up when the sun goes down. That's when the grand finale with a stunningly choreographed firework show will cap festivities in a profusion of light and sound." Noisy flybys (no, Glendale, we are not declaring war on you*) and fireworks for the 2nd time in a week? My cats and everybody else's dogs can't wait! I'm not quite sure why it's necessary to close all the streets all the day, but I'm sure we'll be having such a good time that we won't mind idling for hours taking alternative routes.

*Following the ceremony at approximately 5:45 P.M. will be the Air Parade, an awe-inspiring pageant in the sky that honors Bob Hope Airport and pays homage to Burbank’s close ties to aviation. Included will be McDonnell Douglas F/A-18 Hornets. B-25 Mitchell bombers, Burbank/Glendale/Pasadena Police Notar helicopters, Aero Squadron World War II planes, helicopters from Los Angeles County Sheriff “Air 5” Rescue, Los Angeles County Fire, Long Beach Police and the Orange County Sheriff departments and more.