Best editorial about CA housing crisis EVAH. Thanks, Mike Gatto.

From today's L.A. Times comes this editorial about the current housing crisis, 10 points to keep in mind about housing affordability in California.  The writer is Mike Gatto, who was a CA assemblyman for several terms.  Click here for the article.  My favorite sentence: While having a roof over your head is a human right, being hip is not.

I would add this one thing: Developers build where they build in order to make a profit.  That's why they build/flip expensive stuff -- because there is more money to be made.  Could California come up with a way for developers to make a profit in less expensive areas without cutting corners? I don't think it's a matter of zoning as much as it is a matter of profit. Thoughts?
Photo courtesy of L.A. Times.

No interest rate hike in 2015? That's good news for buyers.

Check out this article from today's L.A. Times here.  Interest rates, including mortgage interest rates, won't be going up this year. This contradicts pretty much everything the Fed has been saying about interest rate hikes since the beginning of 2015, but hey, I'll take it.

Read Steve Lopez in today's L.A. Times, then read my not-really-contrarian blog piece.

Here is the Steve Lopez link and here's the link for my last post. Steve bemoans the current real estate market, with its high prices and cash buyers.  He isn't wrong, and yes, the middle class is being priced out of most of the local r.e. market. And yes, buyers who need a mortgage loan are often being beaten out by cash buyers.  However, his example was South Pasadena.  Home prices have always been crazy there, because the public schools are so. damn. good.

Mortgage rates defy expectations -- by moving down

Today's L.A. Times states that mortgage rates are moving lower! Click here for the article.  This is in contrast to expert forecasts that rates would be steadily going higher and would be at 5% by the end of the year.  This is the news we need to help buyers get off the sidelines and into the local real estate market.

Sunday reading about real estate from the Los Angeles Times

Two interesting articles about real estate appeared in today's L.A. Times.  The first is "Helping your appraiser do the best job" and the link is here. The article begins, "Your home is on the market. You found buyers, a nice young couple just starting out, and they're sold on the home. But wait — there's one more person you have to sell: the appraiser." I'll say.  Elsewhere, the article discusses the need to give the appraiser good comparables.  The listing agent should supply these -- I always do for my listings.

The second article is "4 million homeowners climb out of negative equity" and the link is here.  Just as I been tellin' ya, eh? One of the more interesting points: "[With] 12.6% of mortgaged homes underwater, California has a lower overall negative rate than the national average (13.3%)." I would bet that L.A. County's rate is even lower.  No more short sales! Yay! 

Sunday morning reading for those that didn't go to Coachella

Two great articles about real estate have appeared in today's Sunday papers.

First is an article re bubble market tactics.  It's by Kenneth Harney for the L.A. Times.  It discusses the pros and cons of escalation clauses, no-contingency offers, and low listing prices to draw lots of bidders.

Next is an article from the esteemed Robert J. Shiller for the New York Times entitled "Why home prices change or don't."  It's a bit wonky, but among other items, it discusses how technological advances in home building have helped keep costs down.  I thought it was really interesting.  

Happy reading or happy hanging out at Coachella.

LA home prices up 19.6% last year -- but wait, there's more

Alejandro Lazo at L.A. Times has a great article today about year-over-year housing trends in the L.A. area.  Yes, prices were up in December 19.6% compared to December 2011.  Click here for the article, but read past the headlines -- there's some pretty significant info here (the emphasis throughout is mine):

The strong performance last month indicates that 2013 will also continue to bring home price gains, analysts said.

 

The gains came as foreclosures declined, housing inventory plummeted, mortgage interest rates hit record lows and demand from investors spiked.

In California, buyers can anticipate little new inventory on the market. A supply of only about 2 1/2 months' worth of single-family homes for sale was available statewide at the end of December, the California Assn. of Realtors reported Tuesday. A supply of six or seven months is considered healthy by most economists. Cash buyers and investors are also playing a big part in snapping up home inventory. Cash buyers bought up 33.8% of all resale homes last month, while absentee buyers purchased 29.1% of Southland homes in December.

Oh, those pesky cash buyers! But here's my take-away.  Prices aren't coming down any time soon.  The house you want for $700k will cost you $725k by the summer.  So you may want to think about getting in the game now...

 

 

Sunday reading on the mortgage interest tax deduction and the housing market

Here are two articles from today's Los Angeles Times.  The first details the mortage interest tax deduction and efforts to -- maybe -- eliminate it.  Here's the title and link: A look at proposals to limit the mortgage interest tax deduction.  Of course, if the deduction is eliminated, California homeowners will be hit harder than homeowners in other states.

The second article is Short-sale purchases can easily fall apart.  Here's the link.  Of course, if you've been trying to buy a home in the greater L.A. area for any amount of time, you probably could have written this.

Yes, local home prices went up last month and here are the stats

Did it seem to you like local housing prices rose last month? This L.A. Times article says they did; local prices have risen 5.3% in the last year.  Of course, as I've always said, there are lies, damn lies and statistics, but I have seen an overall price uptick in the areas I serve.

Does applying for a mortgage with more than one lender hurt your FICO score?

One of the reasons that clients give me for NOT getting preapproved by a lender is that they are afraid the inquiry will hurt their credit score.  (Why do you need a credit score in the first place...oh, never mind.)  Here's another article from the LA Times about this very issue. As you'll see, mortgage-related inquiries do not hurt your credit score. If you read nothing else, please read this quote, "The FICO models, Huynh said, ignore all mortgage-related inquiries during the 30 days immediately preceding the computation of the score. All mortgage inquiries during the 45 days preceding your loan application count only as a single inquiry. The same buffer zones cover shopping for auto loans and student loans — but no other forms of credit."  So please call your lenders, okay?

Who is Dorothy Townsend and what does she have to do with real estate?

Dorothy Townsend, an L.A. Times journalist from 1954 to 1986, was the first female staff writer to cover local news in a city room long populated only by men.  Soon after demanding that the city editor assign her to cover the 1965 Watts riots, Dorothy and her all-male team won a Pulitzer Prize for reporting on the story.  She continued to cover tough news assignments and many women journalists who came after Dorothy saw her as a pioneer.  She recently passed away at 88.

 

Now, the Sherman Oaks home that Ms. Townsend shared with her husband, Richard Vanderveld, has been listed by me for sale by the couple’s trust.  The address is 4167 Weslin, SO 91423.  This classic traditional Sherman Oaks south-of-boulevard home needs some fixing and updating, but the stunning location, gorgeous landscaping and architectural details make it a wonderful, welcoming place to live. And two bedrooms plus den, 2 baths and full 1+1 guest house make this home a terrific value.  Other features include generously-sized kitchen, two fireplaces, living room with stepped ceiling and view; dressing area in master, formal dining room, formal entry, covered deck with view, expansive lot with pool, terrace and covered patio plus a view of the surrounding hillsides. Guest house (permits unknown) has kitchenette, separate bedroom and ¾ bath plus separate entrance.  Garage has 3 parking spaces.  Listed for $640,000; sold “as is.” Specs: 1719 sf main house, 10831 sf lot, built in 1939. MLS #12-597141.

For more info, please contact me or see additional pictures on my website at www.judygraff.com.

Elderly and Facing Eviction...and other Sunday reading

The first part of today's Sunday reading has more of a senior citizen theme than a real estate theme. Warning: none of these articles will leave you feeling particularly cheerful. Sorry. The first article, from yesterday's L.A. Times and by Rosemary McClure, is titled Elderly and Facing Eviction.  The title above should link; if not, click here.  Here's a quote: "California's foreclosure crisis has severely impacted some of the most vulnerable tenants in our state — seniors who live in residential-care facilities,...These residents had no warning that they were about to lose their homes, and their families and caretakers were left in a panic to find immediate emergency housing."  My late father was in assisted living and then a board-and-care home as he became progressively more feeble, and I find this article really scary.  It's another example of the social wreckage that foreclosures can bring, and I've wondered how long it would be before the national media began reporting on this element.

The second piece is more senior-related than real-estate related, and is yesterday's Tim Rutten column from the L.A. Times. Its subheading is Ryan’s budget blueprint would push the aged into poverty. Quote:"The nonpartisan Congressional Budget Office has outlined what adoption of this proposal to supplant Medicare with vouchers and private insurance exchanges would mean. The overall cost of healthcare would go up, and retirees' out-of-pocket medical expenses would double — an increase that would push tens of millions of people living on fixed incomes over the financial brink." There was a lot of talk this past week about the new budget plan and its war on women; what about its war on seniors? When did we get like this?

And finally, you'll need to have a strong stomach for the proposed new mortgage rules.  Here's an LAT article from today's edition titled Changes in mortgage finance rules could hurt recovery.  Quote: "...the Center for Responsible Lending...argues that if adopted in its current form, the proposal would make it much tougher for modest-income and minority consumers to afford a first home." IMO, it wouldn't make it tougher, it would kill it.  Hopefully there will be some middle ground in the new regulations.

All your real estate good news/bad news reading in one convenient post!

If you regularly read the L.A. Times or any other major news source, you know that there's conflicting news out there about the economy and real estate.  Here are the latest links from the last week:

First, from Fortune Magazine: It's time to buy a house again.

http://finance.fortune.cnn.com/2011/03/28/real-estate-its-time-to-buy-again/  

I'd love for this to be correct.  One thing though: we never had a lot of new homes here in the center metro area of L.A., unless you count condos.  And a lot of those new condos still haven't sold.

Next, from Rob Hahn via AOL, a rebuttal to the above article: Is it really time?

http://realestate.aol.com/blog/2011/03/29/its-a-great-time-to-buy-a-house-really/

Rob slices and dices the stats used in the Fortune Article and comes up with a different take.

Then, from yesterday's L.A. Times: Banks may be forced into agreeing to short sales.

http://www.latimes.com/business/realestate/la-fi-foreclosure-short-sales-20110330,0,732448.story

I read this with delight, until I got about half-way through the article.  Then, it said that banks can still refuse the short sale if they don't like the sales price.  So, what's the point?

And finally, from A. Lazo in today's L.A. Times: There really is a shadow inventory, and it's depressing prices.http://latimesblogs.latimes.com/money_co/2011/03/unlisted-shadow-supply-of-18-million-homes-looms-over-housing-market.html

I don't want to argue with the statistics experts -- Core Logic in this case -- but it bears repeating that no one set of statistics can be applied to hyper-local real estate markets.

What's your take on our market, dear reader?

L.A. Times catches up: "Home sales and prices on the rise"

Sorry for two LAT posts in a row, but this was the headline on the front of today's times: "Home sales and prices on the rise." (The hard copy headline is slightly different from the LALand headline, where I got the link.) I know you won't believe me, but Peter Hong interviewed me for this article. I didn't make the final edit. Bah.

In fairness to the media and how under-reported this story has been, most of the major journalists use financial statisticians and data experts for their sources. As we all know, those folks measure what has occurred, not what's happening this minute.

As far as all that foreclosure inventory, don't hold your breath for it to hit the market. My sources tell me that it will trickle on to the market over the next two years.

Easier loan modifications and short sales. Are you listening, banks?

Regardless of what the banks would like you to believe, loan modifications and short sales should be getting easier to accomplish, thanks to the U.S. government. Here's a link to an article from today's L.A. Times.

Why I will no longer allow anonymous posts here

The LA Times’ James Rainey wrote a great “On the Media” column today. It’s entitled Website Comment Boards Bring Out the Inner Vulgarian. Boy, I’ll say.

I’m a frequent poster on the LA Times’s LaLand real estate blog. The blog examines the local r.e. market. Peter Viles, the blog editor, rode along with me on our local caravan back in February. Most of the posters there believe the real estate market is in the middle of a prolonged crash, and it can get a little shrill and flame-y. I admit I have contributed to the flames in the past. Lately, however, the comments have been getting very more and more childish and vindictive. For example, from yesterday: “Real estate agent…when you’re too ugly to work at Nordstroms.”

And here, a poster named Anon has continually challenged me on statistics (see my Stalker post, below), ignored my boots-on-the-ground posts on my local market experiences, and has sent in some increasingly viscious comments. Anon, if you don't like my blog, don't read it. If you want a forum, create your own blog.

I have loved the freewheeling nature of blogging and open commenting in major media outlets. But, Rainey is right. The tone of the comments everywhere is descending and beginning to seem like recess on the third-grade playground.

And, this blog is not a democracy. I started it to try to give information about my local market, promote my services and (hopefully) amuse you readers with various real estate absurdities. So, I’m not only going to moderate posts, I will no longer allow anonymous comments of any kind. As Rainey’s article says,

“Webmasters could begin to fix the problem and heighten the level of discussion by requiring folks who want to share their views to also agree to publication of their real names. If you're not willing to put your name beside that lovely screed, maybe it really isn't fully fit for human consumption.”