Multiple Offers on this West L.A. Condo

To sell in this market, it’s all about the price.  This one-bedroom, one-bath, 824-square-foot unit at 12203 Texas Ave., #4, in West L.A. came on the market in August for $459,000. When it didn’t sell, the owner and the agent began slashing the price:  first to $429,000, then to $399,000, and again to its current $359,000.

Agent Melyssa Peters reports that there are now five offers on the property, and she was forthright about its status at her open house on Sunday.  Credit is so tight these days, she said, that she’s not taking any offer for granted.  In fact, she said, the unit recently fell out of escrow.

Melyssa noted that the multiple offers were a reflection of the small number of one-bedrooms on the market in the area — five or six total, she said.

Here’s a look inside:

Sold nearby:

12030 Rochester Ave., #206
Sold for $370,000 on 5/14/08
1BR/1B/702 square feet

1525 S. Saltair Ave., #B
Sold for $386,029 on 8/5/08
2BR/2B/920 square feet
History:  The oddball price, plus the fact that someone paid $460,000 for it in 2005, says this is a bank sale.

On the market:

1437 Stanford St., #B
$469,000
1BR/1B/800 square feet
Days on market: 95

11920 Dorothy St., #203
$389,000
1BR/1B/903 square feet
Days on market: 226

The 401(k) S(k)am

I was hoping that Columbus Day would mean a stock-market break, but alas, the markets are open, free to continue their assault on my 401(k).

I’ve been doing more than a little thinking about the 401(k) concept lately — mainly about how much of a scam it is.  While driving around today, I heard a report on KNX-1070 about how Americans are starting to realize they’ve been duped as far as 401(k)s are concerned:

• Wall Street financiers heavily promoted 401(k)s as a way for people to have control over their financial futures.  Just put money in the stock market, they told us, and your retirement will be secure.
• What Wall Street failed to say is that 75% of professional money managers fail to outperform the market.  Yet somehow, your average Jane or Joe Employee is supposed to be able to manage a retirement nest egg.
• Financial companies rake in $28 billion a year in 401(k) fees, ensuring that no matter how your 401(k) performs, they will still get paid.

So we all start 401(k)s  — what choice did we have?– and guess what:  The financial companies take down the entire U.S. economy, and our 401(k)s go along for the ride.  Oh, and the financial geniuses weren’t content with the billions they got from our retirement accounts; they went after our homes, too. 

So now millions of Americans have no home equity — or, in many cases, negative home equity — and their retirement accounts are in shambles.  So what do you suppose the money managers are doing?  Standing in unemployment lines?  Keeping a low profile? Hanging their heads in shame?

Uh, no.  In fact, L.A. Times consumer columnist David Lazarus writes that while Wachovia Corp. was waiting to see how many billions it was going to get from taxpayers, it didn’t see any problem with treating 75 of its employees to an all-expenses-paid trip to the Greek Isles. 

And senior executives of bankrupt insurance behemoth AIG, recipient of an $85 billion taxpayer bailout, thought nothing of sending its execs to a $440,000 retreat at St. Regis Resort in Monarch Beach. And AIG has no plans to cancel a three-day get-together for employees at the Ritz-Carlton in Half Moon Bay.

“This is an annual affair,” said AIG’s Joe Norton. “It’s a key meeting.”

Such five-star shindigs have long been a standard practice for the U.S. financial industry. They serve as incentives and rewards for top performers, and as regular get-togethers for senior execs.

Stories like these make you understand why people kept their money under their mattresses following the Great Depression.

Let’s be honest:  Employees were way better off with pension plans.  But employers didn’t like them; they were expensive. Enter the 401(k), which solved their problem. Who benefits from a 401(k)?  Employers and Wall Street, for sure. Employees, not so much.

Recent Redfin posts:
A Few New Listings — On the Market 24 Hours
Not Your Grandfather’s Housing Crisis
Reduce Traffic Through Measure R
Southern California’s Mid-20th Century Architecture:  Sunday Driving Tour in Glendale

Mortgage Rates Fall Below 6%

Mortgage rates slipped below 6% percent today—posting their first decline in more than 3 weeks. Analysts say the dip came as investors turned to the safety of Treasury bonds. The increase in investments there caused yields to fall on that debt, which in turn helped lower mortgage rates, which are often tied to related indexes.

Locking in a rate is always a roll of the dice, but I doubt rates are going to slide much farther in the near future. So if you are in a position to get approved for a mortgage in this credit crunch, now may be a great time to lock in the rate. Historically, a 30-year at under 6% is a great deal…and this week, a 30-year fixed rate was averaging 5.94%, down from 6.1% last week. CNN also reports that mortgage applications were up slightly, despite all the turmoil in the banking world. According to Reuters, that was a slight uptick after a big hit last week:

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity rose 2.2 percent in the week ending Oct. 3 to 465.5 after falling 23 percent the prior week to the lowest level since the end of August.

A Few New Listings – On the Market 24 Hours – Links Working

The financial markets may be in turmoil and the real estate market in the doldrums, but houses are still being listed for sale. Here’s a round-up of what’s new on the market this week on the Eastside:

• Here’s a bold for-sale-by-owner (although there is also a listing agent mentioned) in Eagle Rock/Pasadena. It’s a 4/2 mid-century modern with “walls of glass on 3 sides.” It’s only been on the market one day. The owners are asking $1,095,000, but paid $760,000 in 2003.
• THIS ONE HAS DISAPPEARED FROM THE LISTING SINCE YESTERDAY – I’LL KEEP AN EYE OUT FOR ITS RETURN. This bank-owned foreclosure in Echo Park near downtown was listed yesterday for $175,000. It’s tiny— a 1/1 with 624 square feet. The last sale (when the bank took it back, probably) was in July for $221,000.
• This 2/2 in Echo Park has been recently redone with all the usual amenities. It’s got 1,200 square feet and is listed for $599,000.
• Last up is this 4/4 in Los Feliz with 3,579 square feet. It looks kind of 80′s modern inside and out, but it’s in a great area north of Los Feliz Boulevard up near Griffith Park.

Echo Park Birds Stuck in Muck

Looks like I’m not the only one who has noticed how many birds are dying and sick in Echo Park Lake. Chicken Corner, an Echo Park blog, wrote this week about the problem, with lots of locals weighing in as well. The blog’s author, Jenny Burman, apparently spoke to a Parks & Rec worker who thinks it may be avian botulism. Yuk. It does sound like it could be, though—the sick birds seem stuck and unable to move in whatever the toxic-spill looking stuff is on the edges of the lake.

With that lovely image in your minds, how about a look at some lake-view houses? Here are a couple in the hills (more like bumps) close to the lake:

• Here’s a 3/2 short sale for $380,000. The listing photo was apparently taken by a blind person, because it seems to be a shot of the floor of the garage. Not too helpful.
• Here’s a pretty 5/2 that’s billed as being in a historical district. It’s listed at $799,000 and has been on the market a mere 24 hours.
• And here’s something for the adventurous buyer—a build-it-yourself opportunity. This is listed as a “single family home with approved plans for six 1600 sq. ft. houses on 6 small lots.” They are asking $649,000…but I’ll be curious to see if there are any takers on developing in this market.

Not Your Grandfather’s Housing Crisis

When I last blogged for Redfin in this space some three months ago, we seemed to be in the midst of a wrenching but - when considered over the long view - rather routine once-a-decade or so real estate downturn.  

As sharp as the correction was turning out to be, after all, we had seen it all before.  Many Southern Californians remembered the regional housing corrections of the early ’80s and again in the early ’90s following boom (read bubble) times.  Though no fun for owners and would-be sellers of inflated properties, at least we had the comfort of historical perspective, and the foreknowledge that this too would pass; property values would eventually recover and begin to rise again.

Today, three months later, we have no such assurances, no such familiar historical perspective.  We’ve been plunged headlong on a journey through utterly alien territory.  Instead of a relatively routine once-a-decade cyclical event, we seem to be verging on an economic upheaval that happens once in a century, one whose contours and consequences are yet unfathomable.

The neatly compartmentalized housing crisis that was the center of our economic attention just three months ago has spun beyond the bounds of all but the most fanatical bubble blogger’s imagination, and is now mere prologue for the events that, on a daily and hourly basis, are unfolding on an unthinkable scale.  Not since 9/11, or perhaps Katrina, has the nation, and the world, been so transfixed by a cataclysmic spectacle.  That this one is reshaping the economic universe, rather than the political one, makes it no less arresting.

The role of Redfin’s bloggers in all this is, thankfully, modest and focused:  we strive to shed light on the current dynamics of real estate in the communities where we live.

How the financial and economic maelstrom that is accelerating around us will impact ordinary buyers and sellers, asking and selling prices, incomes and inventories, completely remains to be seen.

I’m happy to be back at Redfin keeping watch on my pockets of the housing market for readers in these extraordinary times.

Reduce Traffic Through Measure R

About two weeks ago, I got a pamphlet in the mail. It was the information guide for Measure R. Measure R adds a half cent sales tax increase to LA County and will pay for lots of goodies, like street repair, light rail transit expansion, and bus line improvements. According to the LA County Metro, the average increase in expense per year to the average Joe Commuter or Jane Driver is $25. Measure R comes on the ballot in November.

Are you kidding me? Twenty-five bucks? I’m sold! I’d pay twenty-five bucks a year to reduce traffic, cut down on smog, improve the streets, and make an efficient public transportation system available to the masses.

Think about it this way. If you buy $5,000 a year in taxable stuff, you’ll currently pay $412.50 in sales tax (8.25%). If you pay the tax hike of half-a-cent for measure R, you’ll pay $437.50 in sales tax. Take a look at the proposed rail expansion projects (Click map below). It would be much easier to travel from parts of the San Fernando Valley to the rest of Los Angeles.

Curbed LA has a mention in their blog about the proposed measure. LA Times says “Yes” on R, while a few naysayers say “No“. What do you say?

Southern California’s Mid-20th Century Architecture: Sunday Driving Tour in Glendale

The Glendale Historical Society‘s 2008 Home Tour will feature five mid-20th century architectural gems located throughout the hills and canyons of Glendale, from Whiting Woods in the north to Adams Hill in the south, the work of “some of the best architects you’ve never heard of.” The self-driving tour takes place this Sunday, October 12, from 10 a.m. to 5 p.m. Tickets and maps are available here, or at the starting point of the tour - the southwest corner of Verdugo Road and Mountain Street in Glendale – beginning at 9:30 a.m. on Sunday.

Most of Glendale’s early tracts were built in the 20s and 30s, but there are pockets of mid-century homes throughout the hills and outer reaches of the city. Many residents’ favorite downtown landmark is the prominent Fidelity Federal Building. Its renovation, argued over and followed closely by local preservation advocates, is nearly complete. Current and historical photos, and a rendering of a proposed animation center using the site, are posted on Tropico Station. 

Here are a few mid-century Glendale homes in the upper Rossmoyne/Royal Canyon areas currently listed on Redfin:

1944 Las Flores
$1,995,000 (originally $2,175,000)
4 bed/2.75 bath
2,593 sq.ft.
$769 per sq.ft.
On Redfin 69 days
The listing names as architect Raymond Jones, and the home sits on a little over 1 acre up in the hills with a panoramic view. It last sold in 2006 for $1,650,000.

1857 Las Flores Drive
$979,000 (originally $1,008,900)
3 bed.1.75 bath
2,242 sq.ft.
$437 per sq.ft.
On Redfin 74 days
This is a split-level home sitting on a 11,150 sq.ft. street to street hillside lot.

1135 Esmeralda Drive
$699,000 (reduced in price three times, originally $850,000)
3 bed/1.75 bath
2,173 sq.ft.
$322 per sq.ft.
On Redfin 221 days
This is one of the lowest priced homes in this hillside area, and looks from the photos as if it has many original 50s touches – some of which might appeal to buyers interested in period design.

Choosing California Native Plants and a Pasadena Favorites Update

My California native plant landscaping lessons – post 2: Las Pilitas Nursery in Escondido, the Rancho Santa Ana Botanic Garden in Claremont, and the Theodore Payne Foundation for Wildflowers and Native Plants in Shadow Hills (right outside of Burbank) each have great websites with lots of information about California native plants. The Theodore Payne Foundation is also holding its annual fall sale this weekend, as I mentioned in my last post.

I decided last year that the next landscape project I worked on and maintained would be one that did not require regular mowing, blowing, or watering. My primary goal was to save money, but I was also motivated by the idea of contributing to a more sustainable urban environment. The first website I came across during early research was Las Pilitas’ in Escondido. I read the detailed descriptions of many shrubs, ground covers, perennials and annuals with interest, wondering when, if ever, I would be able to drive to Escondido and buy all these plants.

Finally, I decided that just like anything else, if I can find it anywhere in the world, I should be able to find it in Los Angeles. I started searching on the web for native plants and Los Angeles and found the Theodore Payne Foundation, located right off Tuxford Street in Shadow Hills, a 20-minute drive from Glendale. This nonprofit foundation is dedicated to preserving native wildflowers and plants, and runs a small nursery along with year-round educational programs and a book and seed store (where I bought packages of gilia tricolor, the wildflower in the photo, courtesy of Kida Yasuo). It also has a large online library of native plants.

Before I bought any plants, I wanted to know how they would look as they grew in the garden. Searching through some links, I discovered that the Rancho Santa Ana Botanic Garden maintains a large arboretum (along with a bookstore and its own annual plant sale) open to the public. I took a 40-minute drive to Claremont one morning, and wandered around the gardens, searching for plants I had seen online. Some appealed to me; others in their full-grown state didn’t look like they would work. This was a worthwhile trip (and by the way, they host field trips and provide educational programs for schools).

I’ll write about my next landscaping steps in an upcoming post.

Here is an update on three Pasadena 91104 listings I featured and saved in Redfin’s Favorites:

1255 E. Lexington Street
Sold for $745,000 (9/11/08)
I featured this property on July 22. It was listed at $755,000 and had been on the market for 44 days.

1985 Santa Rosa Avenue
Sold for $470,000 (9/12/08)
This property appeared in my August 1 post. It was listed at $499,000 and had been on the market for 30 days.

1508 Sinaloa Avenue
Sold? for $562,000 (9/29/08)
This looks like a foreclosure. I featured it just last week, on October 1, when it was listed at $755,000 (down from an original list price of $899,000).

Struggling To Keep The Lifestyle In Granada Hills

When all is said and done, how does your monthly budget look? Do you have money left over to save or are you living beyond your means every month?

I’ve been keeping track of what I spend money on and it’s a real eye-opener to see where all the cash goes. I use the Monthly Home Budget chart that’s part of my Microsoft Office programs. But I’m sure there are plenty of other software choices out there that can help keep track of monthly spending habits.

One family in Granada Hills spends beyond their means every month. Kim Shekerlian and Stan Monterrosa have a combined take-home pay of $4,600. Their mortgage is $1,850. And judging by their budget list, they really don’t spend extravagantly.

Click the chart below and take a look at how they spend their money.

The couple’s story comes out of an article from the Daily News.

Just for kicks, I thought I’d check out what types of homes you could afford in Granada Hills for the same mortgage that Kim and Stan are paying. I’m assuming 20% down ($75,000) on a $375,000 house with a 6.25% interest rate for a monthly payment of $1,847 and some odd change.

15946 Lahey St./4bd, 2bth/1,383 sq. ft./$345,000

11219 Gaynor Ave./4bd, 2bth/1,399 sq. ft./$369,950

11130 Whitman Ave./3bd, 2bth/1,537 sq. ft./$390,000

By the way, the above listed homes are all part of best-ranked elementary school in the area (according to GreatSchools.net) – Danube Avenue Elementary School.