2007 N. 6th in Burbank is sold, we think.*

The serious fixer property that I listed in the Burbank hills sold in a last-minute bidding war on Wednesday.  I never thought it would happen.  It has been listed since November.  Although we had many all-cash offers from qualified buyers, we didn't get close to the price the sellers would accept until last week. 

Then, the activity got heated and there was a lot of drama. Potential buyers began to bid against each other in small increments.  Seventy emails were sent and received about the offers on Wednesday a.m. alone.  Old offers rose from the dead.  Some players withdrew their offers and left the playing field only to reinstate their offers later in the day.  Friendships and professional relationships were skewed (well, mine with some of the other agents).  Buyers were unhappy.  Sellers were unhappy.  There was weeping, wailing and gnashing of teeth (okay, I'm exaggerating).  But at the end of the day, it sold for a price acceptable to the sellers and buyer, and we all either drowned our sorrows or celebrated, or both.

*This is a probate and all heirs (there are several) need to okay this.  They probably will, but you never know.  Stay tuned.

I predict the short-term future of the local real estate market

Although I don't have a crystal ball, I think we're in for a strong first and second yearly quarters, as far as San Fernando Valley and Los Angeles real estate goes. Why do I say that? It appears that buyers are coming out of the woodwork.  There's a nexus right now between low interest rates and lower-than-in-recent-memory home prices and short inventory.  Everything is going into multiple offers.  There are lots of cash buyers out there.  Plus, I think that potential buyers may just be tired of sitting on their hands and may be feeling a little more confident than they have in the recent past.  I wouldn't be surprised to see prices go up before the summer. We'll see...

Yet more info on Southland property flippers

I've been posting about flipped properties lately, and here's more info and statistics about that very thing from today's L.A. Times.  The short of it: investors, most of whom are likely property flippers, are crowding the low end of the market.  The title should link; if not, click here.  Some salient quotes:

"The one thing that is certainly true at the moment — because rents are rising and house prices are flat or falling — is yields on houses are pretty good right now," said Richard Green, director of the USC Lusk Center for Real Estate. "It creates a problem for ordinary people, because a lot of investors are buying with cash, and so cash buyers can buy for less money." So if it seems like there are no inexpensive homes on the market, that's why.

And "...buyers who paid all cash purchased 29% of all Southland homes in December." Statistically, many of those cash sales were in the middle- and high-price catagories, too.  I am constantly amazed by how much cash is out there.

And, perhaps the most important stat of all: "Nearly 1 in 3 homes sold last month on the resale market was a foreclosure and about 1 in 5 was a short sale."

The article also discusses price declines in December, but that usually happens at the end of the year.  My take-away is good and bad.  Obviously, even though there should be great deals on properties out there, the competition for true bargains in all price catagories is fierce and cash is king.  The good news for regular buyers is that many/most of these investors are doing some very nice rehabbing of properties.  They are spending their cash on the fixes needed so you can spend yours on your mortgage -- and tax deduction.

I think I need to start going to foreclosure auctions.

Real estate word for the weekend: flip

I showed property all over the San Fernando Valley this past weekend.  It seems that just about everything I saw was a professionally rehabbed home.  And they were mostly nicely done, too.  The one above is on Buffalo, just south of Chandler, and it's already in escrow.  The other noted trend: most of the flippers are also real estate brokers with their own companies -- no longer are these groups of flippers giving their properties over to large real estate brokerages to sell, they are creating their own companies and selling the properties themselves. Back to the rehabbing: all in all, I think it's a good trend -- most buyers today have neither the time nor money to fix a home after they purchase it.

Cutest house of the week, in Echo Park! But my clients didn't get it. Bah.

This is 1801 Bellevue in Echo Park and it's the cutest house I saw this week.  It's a rehab/flip, and it's adorable.  It has 3 beds, 2 baths, a den, a separate studio, and an oversize garage plus a front and back yard.  It also has been really well-staged, and I'm crazy about good staging.  I know that some people don't care for Echo Park, but this street feels really safe -- it's a cul-de-sac at both ends.  Recently, the community has attracted many buyers who like both the traditional family housing stock and the urban feel.  Plus, the city is re-doing Echo Park Lake.

Enough about how great this is.  Here's how our transaction went.  Or didn't go.  The house was listed at $499k. It received 10 offers right away.  One was from my very well-qualified buyers.  Unfortunately, the bidding went up to (and maybe passed) $550k and the sellers took another offer.  Damn. Damn. Damn.  My buyers are disappointed but will live to fight another day.  I'm disappointed, too -- this is something I would have bought if I were (much) younger and wanted the neighborhood!

Cheaper to buy than to rent? Just about...

With interest rates down to 3.85%, it may be cheaper to buy -- yes, including property taxes and insurance -- than it is to rent.  Some clients of mine have made an offer on a $525k home.  They are putting 20% down, and their lender has given them a rate of 3.85% with no points.  Unheard of.  Their lender's estimate showed that their monthly nut, including property taxes and insurance, will be $2500 plus change.  This is for a redone 3+2 with a separate studio! Considering that barely decent 2 bedroom homes are renting for around $2k, could the housing market turn around this spring?

Seen in Echo Park: this tree! What is it?

I showed property in Echo Park yesterday and spotted this tree.  What is it? A poinsettia tree? Whatever it is, it's beautiful.  Yes, Echo Park is still a bit edgy but it's coming around.  I wanted to buy the rehabbed property I saw with my buyers -- it was that cool, and staged perfectly -- I'll publish the pic and address once I know whether or not my clients want to make an offer on it.

Best performance by an actor playing a Realtor - the Oscar goes to Matthew Villard!

Have you seen "The Descendants" yet? The Realtor character was so accurate that it had me both horrified and laughing at the same time.  The actor's real name is Matthew Villard.  He has the high-end salesman with the 1000-watt phony smile down cold. Congrats, Matt.  I have another biz in mind for you in case the acting thing doesn't work out for you.

About our next favorite thing after real estate: Food! And what's the best Mexican restaurant in the SFV?

Are you thinking about food when you're not thinking about Southern California real estate?  Today's L.A. Times Food section has a great article about the best smaller, ethnic food places in the L.A. area.  Note how many are in the San Fernando Valley!  Title should link; if not, click here.

Along these lines, does anybody know of a really good Mexican food place in the east SFV besides Don Cuco's and Mucho Mas?  We went to El Cholo in Pasadena the other day but it has become very corporate.

Happy New Year! Where do you stand on the great home buyer/seller divide?

I hope 2012 is a great new year for us all! To start the new year off right, here's an article about a study of the divide in expectations between home buyers and sellers. It appeared in today's L.A. Times; the title should link but if not click here. The article starts out this way:

"Where do you side in the great real estate buy-sell divide of 2012? If you're a homeowner considering selling sometime in the new year, are you apprehensive that you won't get the price you need or want, and therefore it's possible you won't even try to sell? If you're a buyer, do you agree that with 30-year fixed mortgage rates now below 4% and home prices near cyclical bottom in many areas, 2012 offers extraordinary opportunities, even if listings are fewer than you might prefer?"  Boy, that certainly hits the nail on the head.  In my experience, the sellers' sentiment is extremely common.

The article also states, "Many owners "have not adjusted their price expectations downward" to keep pace with local declines in property values after the mortgage bust." I'll say.  But in fairness, many owners can't go down much on price without being upside-down, either.

And here's a final take that I'm seeing more and more of: "...agents sometimes walk away from unreasonable listing price demands, but they also use a technique that seeks to bridge the seller-buyer divide: pre-authorized price reduction clauses in the listing contract that ratchet down the asking number."