Archive for October, 2008
October 8, 2008
But first,
In November, I hope voters across the nation will take the opportunity to do some serious weeding out of every tough-rooted, invasive, resource-sucking politician on either side of the political aisle who looked the other way as our financial system was rigged for collapse.
(That is the end of my rant for today, as I’m sure our readers can find similar rhetoric just about anywhere on the web. And now for the non sequitor, yet matching metaphor, transition:)
In the meantime, literally pulling out weeds can be a stress reliever, and October is an ideal month for planting a California native garden. I speak from experience: last year I did some landscaping myself, then I had to call in help when the garden was overwhelmed with weeds.
I began with a dead lawn that hadn’t been maintained in years. I let that die during spring and summer, and read up on ways to clear out weeds. One method I didn’t try, and I’m curious if others have used successfully, is heat sterilizing the soil by laying clear plastic over wet dirt during the hottest weeks of the summer. High temperatures of 100+ degrees underneath the plastic are supposed to kill weed seeds in the soil down as far as 12 inches. I looked around for large rolls of plastic, tried to figure out how this would look and if it would remain in place in a front yard for 2-3 weeks, and eventually decided against it.
Instead, I hired a crew to clear out and rototill the soil, which set me up for problems later. I planted small native shrubs in October, and gave them regular water to help them get established. I stopped watering as winter rains soaked the soil. Unfortunately, the rain helped dormant weed seeds sprout, and by spring my carefully planted shrubs were overwhelmed by a 2-3 ft. high jungle of weeds flourishing in rototilled, well-watered soil. It took weeks of additional weeding, and installation of heavy-duty weed cloth topped with mulch, to clear the mess.
The native plants are now filling in and flourishing. I have an attractive, meadow-like garden that doesn’t require regular mowing and uses very little water. Weeds continue to sprout, though, wherever they find an opening (usually near the base of the shrubs, which can’t be covered with weedcloth, or on the edges of the parkway next to the sidewalk).
I’ll share how I picked plants for the garden and other lessons I’ve learned in future posts. For readers who have been waiting to start a California native garden, the Theodore Payne Foundation native plant nursery in Shadow Hills is holding its annual fall sale this weekend, October 10-11, for members and nonmembers.
The foundation’s website is a great resource. Here are a few others: my back 40 (feet) covers Pacific Horticulture, the Sustainable Gardening blog covers a wider geographic area and more general sustainability issues, Garden Wise Guy discusses the pros and cons of fake lawns in this post from his Santa Barbara blog, and Garden Rant discusses replacing lawns with native plants in the San Francisco area.
Thank you to Kida Yasuo, who took this post’s photo of the California native wildflower Clarkia Unguiculata. These started sprouting in my garden this spring, and many are still standing and blooming.
October 8, 2008
The price has come down on this three-bedroom, two-bath, 1,184-square foot bungalow at 7725 W. Norton Avenue in West Hollywood. Unlike some small homes in the area, this one has a decent-size lot – 5,179 feet, according to Property Shark.
It came on the market in September with an asking price of $799,000, but over the weekend it came down to $745,000. It has a wood-burning fireplace and some nice built-ins. The street dead-ends into Genesee Avenue, so it has no through traffic.
What about comps? Well, the house a few doors down, at 7606 W. Norton Ave., sold for $725,000 in May. It has about the same square footage as its neighbor, but it has only two bedrooms and one bathroom.
Around the corner, the 2+1 at 7526 Hampton Ave. sold in April for $797,500. It has 1,066 square feet, built in 1916. A similar house at 7510 Hampton Ave. sold in May for $757,500.
The 7725 W. Norton house needs some updating, but as a standalone house in West Hollywood, it will probably go fairly quickly. They’re hard to find in the area, and many people prefer homes to condos.
October 8, 2008
The Wall Street Journal reports that 1 out of 6 American homeowners — about 12 million households — owe more on their mortgages than their homes are worth.
The comparable figures were roughly 4% under water in 2006 and 6% last year, says Moody’s Economy’s chief economist, Mark Zandi, who adds that “it is very possible that there will ultimately be more homeowners under water in this period than any time in our history.”
Among people who bought within the past five years, it’s worse: 29% are under water on their mortgages, according to an estimate by real-estate Web site Zillow.com.
The story notes that this statistic makes foreclosures more likely, because underwater homeowners needing money will have few ways to obtain it.
Which brings up another topic: the national Countrywide loan-modification program agreed to this week by Bank of America. The program is designed to modify mortgages so people can stay in their homes, but how many people will it help?
According to this Contra Costa Times story, the program may only postpone the inevitable:
The new efforts could create a fresh round of problem loans and foreclosures a few years from now, warned Sean O’Toole, founder and chief executive with Discovery Bay-based ForeclosureRadar.com. Many of the restructured loans could produce more woes later.
“Maybe the loan won’t blow up now, but it will blow up in five years,” O’Toole said.
That ominous assessment is based on Countrywide’s approach in the voluntary program. In more than a few instances, O’Toole said, Countrywide’s restructured loans featured payments based on super-low interest rates of 2 percent, with payments rising over time. Put another way, the loans bear similarities to the ones at the heart of the current problems.
In other words, these restructured loans only buy homeowners some time to figure out how to make those larger payments.
Bank of America should restructure the loans so that the payments are high enough to pay down the principal on the mortgages, O’Toole said.
If the housing market doesn’t rebound strong, mortgage balances could still burden houses with more debt than the residences are worth, O’Toole said. He cited the restructuring of a mortgage with a $930,000 balance for a house valued at $500,000. Bank of America rewrote the loan with a fixed interest rate of 2 percent that would last five years.
“Bank of America and Countrywide are kidding themselves if they think that house will be back to $930,000 in five years,” O’Toole said.
Are there really homeowners out there who would stick with a mortgage that’s twice the value of their homes? And with a 2% mortgage, no principal is being paid down, so they’re merely treading water instead of improving their financial situation. At some point, wouldn’t most people in that situation just walk away?
Furthermore, the story notes, only people whose debt payments are below 34% of their gross monthly income will be eligible for the B of A program. That’s going to disqualify a ton of people right there.
Recent Redfin posts:
Foreclosure Numbers Keep On Rising
The Q3 Foreclosure Report is In
Debt, the Engine of Prosperity, is Out of Fuel
Chart credit: The Wall Street Journal
October 7, 2008
The one-bedroom condos at the mid-century complex at 525 S. Sycamore Avenue, near Hancock Park, sold for close to $400,000 at the peak of the market, but not anymore. Today, the units are fetching around $300,000, so some owners are facing short sales.
Here’s a unit in the building that came on the market three weeks ago — #333 – for a whopping $415,000. Ten days later, it was reduced to $399,000, and this weekend it was slashed to $349,000. It was purchased in 2005 for $340,000, and the owner must have hoped that the comps and the market downturn didn’t apply to this unit.
Comps:
525 S. Sycamore Ave., #232
Sold for $305,000 on 7/24/08
1BR/1B/622 square feet
525 N. Sycamore Ave., #226
Sold for $280,000 on 7/1/08
1BR/1B/625 square feet
525 N. Sycamore Ave., #227
Sold for $280,000 on 8/14/08
1BR/1B/676 square feet
For sale:
525 N. Sycamore Ave., #210
$275,000
1BR/1B/676 square feet
Days on market: 12
525 N. Sycamore Ave., #231
$310,000
1BR/1B/680 square feet
Days on market: 117
Status: Looking for backup offers
October 6, 2008
Late last night someone posted on the blog, wanting to know the outcome of my small-claims lawsuit against my landlord that I blogged about a couple of months ago.
To recap, we moved from our expensive Beverly Grove apartment in June. 
We were model tenants, and I thought the landlord and I had a decent relationship, so I didn’t do the things you’re supposed to do when you move out, such as invite the landlord over for an inspection and agree on repairs. I fully expected to get back our entire deposit; instead, she took out $600 for “paint touch-up,” cleaning, water spots on the cabinets, and scratches on the wood floor.
According to the civil code pertaining to security deposits, landlords are not allowed to charge tenants for normal wear and tear. I had cleaned the apartment before I left, and as far as the floor and the cabinets, I had no idea what she was talking about. And there was no doubt that she was not allowed to charge for paint touch-up, which is definitely wear and tear.
I sent her a letter demanding my money and didn’t hear back, so I filed a small-claims lawsuit against her and had her served. Apparently you can sue for two or three times the amount due to bad faith, but all I wanted was my money back.
Before my landlord got served, she sent me a certified letter with a check for $100, explaining that she had accidentally charged me for window cleaning. It was clear that she was surprised at being challenged, and she probably hadn’t boned up on tenant law until my letter.
About a week before the case was due to go to court, she called me to negotiate. I didn’t want to talk to her, so my husband did. She told him that she had had to get the curtains cleaned, which I frankly forgot about, and that the trashcan that had been installed on runners under the sink was missing. I think that trashcan was in the storage unit and had been tossed out.
Because of that, my husband agreed to split the difference, so we got another $300. But with the court filing and the service fee, I was out another $85.
I could have refused to settle, but the truth was, I didn’t want to go to court. Not only did the idea of standing in front of a judge make me nervous — I have a pronounced phobia of public speaking — but I wasn’t completely sure I would win.
I know I had a good case, but because I hadn’t done the things you’re supposed to do when you rent, like a walk-through upon move-in and move-out, it might have been a my-word-against-hers situation. But California tenant law definitely favors the tenant. And the fact that she provided no receipts to back up her claims of repairs was in my favor: Landlords have to provide documentation that the repairs they claim were made were actually made.
I think she will think twice about making arbitrary deductions from security deposits from now on. And I will take some lessons from this, too.
My advice to renters: Familiarize yourself with California’s law regarding security deposits. And conduct a move-in and move-out inspection with the landlord using a form like this. There’s almost no chance of surprises that way. No matter how nice your landlord seems — and mine seemed VERY nice — don’t trust; verify.
Recent Redfin posts:
Silver Lake Gets Needed Traffic Light
The Subcompact Hybrid: Good Choice for Parking in Rossmoyne
How to Commit Fraud and Get Loans Approved
October 6, 2008
So you all know that they signed the bailout bill last Friday, right? The provisions in the bill include measures that are supposed to help owners avoid foreclosure. But the bill isn’t exactly what I wanted to write about today.
Instead, I wanted to share this with you.
I went back to one of my favorite real estate blogs, BusinessWeeks’s Hot Property, and found an interesting little post. Peter Coy, who wrote JPMorgan’s “Cheats & Tricks”, uncovered an older article that speaks volumes about the mentality that got us into this mortgage mess. There was a memo that got sent through JPMorgan Chase’s email system. The memo details how loan representatives can get Zippy (the Chase loan underwriting system) to approve loans that otherwise would be denied to applicants. Well, the alleged author did get fired (she maintains her innocence in the article) and JPMorgan did issue a statement that the memo was not representative of corporate policy. However, it’s easy to see why so many homeowners are in such a financial mess with friendly mortgage brokers to help along in the process of spending beyond their means.
OK. Just go ahead and read the memo. Feel free to let me know what you think.
ZiPPY Cheats & Tricks…
If you get a “refer” or if you DO NOT get Stated Income / Stated Asset findings…. Never Fear!! ZiPPY can be adjusted (just ever so slightly)
Try these steps next time you use Zippy! You just might get the findings you need!!
• Always select “ALTERNATE DOCS” in the documentation drop down.
• Borrower(s) MUST have a mid credit score of 700.
• First time homebuyers require a 720 credit score.
• NO! BK’s OR Foreclosures, EVER!! Regardless of time!
• Salaried borrowers must have 2 years time on job with current employer .
• Self employed must be in existence for 2 years. (verified with biz license)
• NO non-occupant co borrowers.
• Max LTV/CLTV is 100%
Try these handy steps to get SISA findings . . .
1) In the income section of your 1003, make sure you input all income in base income. DO NOT break it down by overtime, commissions or bonus.
2) NO GIFT FUNDS! If your borrower is getting a gift, add it to a bank account along with the rest of the assets. Be sure to remove any mention of gift funds on the rest of your 1003.
3) If you do not get Stated/Stated, try resubmitting with slightly higher income.
Inch it up $500 to see if you can get the findings you want. Do the same for assets.
It’s super easy! Give it a try!
If you get stuck, call me . . . I am happy to help!
Tammy Lish
(503) 307-7079
tammy.d.lish@chase.com
October 4, 2008
Do you remember being 19? At the time I was 19, I made enough money from my part-time job to cover the expenses of my clothing needs. I had a roof over my head. (Thanks, Mom and Dad.) And I was happy with that.
But if you’re 19 and a starlet in Hollywood, you make enough money to buy much, much more. In the case of High School Musical actress Vanessa Hudgens, her job buys her a $2,750,000 house in Studio City. How’s that for a first house purchase?
Here’s an excerpt from the LA Times Hot Property Article.
The house, old-world Tuscan style, has a city lights view. There are six bedrooms and 6 1/2 bathrooms in 5,200 square feet. The property has a Pebble Tec pool and spa, waterfalls, cabana and a barbecue island. The kitchen has Thermador appliances and copper sinks. There is a wine cellar with glass doors and Mexican wrought iron.
Apparently, even Miss Hudgens got a deal on her new home – if you can call it that. The home was on the market for nearly a year and was most recently listed at $3,299,000. If you break it down, the home comes out to $529 a square foot.
There are a handful of properties in Studio City that you can get in the same price range (if you’re curious or are just loaded.) Here are a few I wouldn’t mind owning.
3297 Wrightwood Dr./4bd, 3.5bth/4,082 sq. ft./$2,699,000
3725 Goodland Ave./6bd, 5bth/5,473 sq. ft./$2,995,000
11540 Kelsey St./5bd, 6bth/5,870 sq. ft./$3,349,500
October 4, 2008
The narrow driveways of many older neighborhoods in Southern California make we wonder: How did people from the 20s to the 80s maneuver vehicles in and out of their small garages and narrow driveways? Very small hybrid vehicles are available today, but they were not a mass market option when these driveways were laid.
Most homes in the Rossmoyne section of Glendale, just north of downtown, were built in the 20s and 30s and feature Mediterranean, Tudor, or Colonial designs. The neighborhood is well-kept, and home exteriors show very well, but garage access is not a selling point. Driveways here start out narrow, and when their borders reach houses they get even narrower. Some homeowners don’t even try to get their car past the house and into the garage.
Over the long term, maybe this is a good low-mileage strategy. If parking a car at home is difficult, more people will find other transportation options. Perhaps this is good design as well – with less land devoted to the driveway, there is more room for landscaping. Many streetscapes in Rossmoyne and other Glendale neighborhoods have a pleasant parklike atmosphere because of this.
Homes with close to 2,000 square feet were going for over $1,000,000 here at the peak of the market. According to Redfin’s neighborhood pages, homes sold here during the past three months had a median list price of $950,000, and a median sold price of $782,000. The average number of days on the market: 88.
These listings, in order from least to most expensive, are all on the market for below the average price per square foot in the area:
901 N. Everett Street
$630,000 (reduced from $665,000)
3 bed/2 bath
1,578 sq.ft.
$399 per sq.ft.
On Redfin 130 days
Built in 1929. This a lender-approved short sale.
1214 N Everett Street
$769,000 (reduced 3 times from $829,000)
3 bed/2 bath
1,928 sq.ft.
$399 per sq.ft.
On Redfin 74 days
Also built in 1929.
849 Cavanagh Road
$1,595,000
3 bed/2.25 bath
4,200 sq.ft.
$380 per sq.ft.
On Redfin 61 days
This is a trust sale with no court approval, designed by Paul Williams and built in 1928.
October 4, 2008
The Los Feliz Ledger reports this month that a traffic light has been approved for Silver Lake Boulevard at Earl Street (I’d post the article, but for some reason the Ledger’s website is always a month behind their print edition!). While not all residents are happy about it, I think it’s a much-needed safety measure as the walking path and meadow around the reservoir gets ready to open. As most Silver Lake residents know, this street is a huge cut through for commuters and cars routinely zip along at high speeds. The problem is, it’s also a big walking and jogging area with lots of curves…so you get a bad mix of fast cars and people on the street. The article says that the street actually gets 19,000 cars each day!
It’s a great area, though, and buyers with a little bit of money can do really well for themselves with lake-view homes that only a few months ago were well above $1.5 million. Here are a couple worth looking at – this first one looks really interesting:
- This one is on Kenilworth, one of my favorite streets. It’s an English Tudor in the Ivanhoe school district, and it’s seen almost $300,000 in price reductions. Currently, it’s $999,000.
- Nearby on Moreno is this 3/3.5 for $1.295. It’s got 2,633 square feet, and the price has come down $100,000.
- This 2/3 has a modern/industrial vibe, and can’t seem to sell – it’s been on the market 479 days! Maybe it’s the price…$1.399 for a 2/3.
October 4, 2008
Property Shark released another foreclosure report, and despite a slow down last time around, this time it looks like the numbers are going up. Los Angeles leads in the metropolitan areas the report looks at (New York, Miami, and Seattle being the others) with a 196% increase compared to Q3 of 2007 in foreclosures. Ouch.Those numbers mean that .5% of all homeowners in LA are in foreclosure.The good news, if you can call it that, is that all of these foreclosures continue to be centered in the outlying areas like Palmdale and Lancaster (see chart, also courtesy of Property Shark). In the year or so that I’ve been following Property Shark’s reports, I have never seen any central or westside zip codes pop into these heavily-foreclosed categories. It really does seem like in LA, we’re dealing with pockets of very bad real estate that are dragging down prices and sales across the board.The report also made an interesting finding about who is behind all these bad loans: In Los Angeles, Countrywide had the most loans scheduled to foreclose, followed by Washington Mutual. Like most Americans, I’ve been watching the bailout debacle pretty closely, and have actually had mixed feelings on bailing out homeowners who got themselves into bad mortgages. I personally have always been pretty financially cautious and believe in a 30-year fixed with a monthly payment you know you can manage, so I have little sympathy for those who signed up for 1 or 2 year adjustables with a vague hope that they would be earning more or win the lotto by the time the payment changed. But when I see that Countrywide and Washington Mutual are holding so many of these bad mortgages, it does make me give more weight to the predatory lending argument. I have trouble believing that all irresponsible borrowers magically found their way to these 2 lenders. It does make it seem like there was pressure or bad advice being given. I’d be curious to hear what others think….
