Archive for March, 2008
March 26, 2008
Today my internet was down for several hours, due to the cable company working on some wires outside of my house. It was quite the frustrating experience. Like most working people, the internet is my lifeline and being without it, even for just an hour, much less several hours makes for an unpleasant day. Believe it or not, I did find a few other productive things that I could do that did not require the use of a computer. So after getting off the phone with the cable company to see when my service would be back up, I decided to fold some clothes. Finally, after three more hours I saw my lovely instant message automatically sign back on. Ahhh, to my relief, service had returned. I was such the happy camper. But it made me realize that as upset as I was, nothing last forever and that it was sure to pass. The same goes with our lovely real estate market, while things are down, it is sure to pass. These past sales in Newport Beach indicate, that while it may be dim there’s light at the end of the tunnel.
517 Avenida Campo: $835,000, 3 Beds, 2.5 Baths, 1737 SQ. FT.
428 E. 18th St: $1,250,000, Beds and Baths not listed, 1,183 SQ. FT.
1094 Buckingham Ln: $500,000, 2 Beds, 2.5 Baths, 1368 SQ. FT.
2416 Margaret Dr: $1,350,000, 4 Beds, 2 Baths, 1,106 SQ. FT.
1027 Mariners Dr: $3,000,000, 5 Beds, 4.5 Baths, 3,795 SQ. FT.
535 San Bernadino Ave: $1,170,000, 3 Beds, 1 Bath, 1,159 SQ. FT.
4215 Patrice Rd: $480, 000, 3 Beds, 2.5 Baths, 1,298 SQ. FT.
1312 Notingham Rd: $1,100,000, 3 Beds, 2 Baths, 1,765 SQ. FT.
March 26, 2008
It seems that homeowners are starting to get antsy. Yesterday while listening to 89.3 KPCC I heard the news that was echoed around the housing market – sales were up, sales were up, sales were up! Investors, analysts, etc. flooded the radio speculating on what this means. But most were wise in their reportings – prices were down – way down. It seemed there were two schools of thought on what this means. Both agreed that this meant that the much needed price corrections were finally starting to happen. But one analyst pointed out that many of the sales were to investors and that this might be the first wave (of two) in this bubble devastation.
Interesting enough, it seems sellers desperately trying to sell their homes are using one of two strategies to do so. First, the huge price drops. Then there are the constant micro-price drops. Both strategies have their logical merit, but honestly, I still am convinced the best way to go is to just price it right and competitively from the get go. No one is really interested in a home that has been reduced $500, 13 times. Here are a few examples of both approaches.
The Big Drops
27906 Amber #231, MV
2 beds / 2 baths / 1,221 Sq Ft
Previously Listed: $380,000
Currently Listed: $280,000
This home just had a $100,000 price reduction. If you look at it, it could read 26% off. That’s huge! Other homes in the area are going for far more. If you’re looking for a bargain, this might be one to check out.
891 Ronda Sevilla #D, Laguna Woods
1 bed / 1 bath / 770 Sq Ft
Previously Listed: $229,000
Currently Listed: $129,000
I normally don’t cover too much Laguna Woods, but with another $100,000 price reduction (44% reduction) I couldn’t pass on reporting this to those who might know someone in the 55+ market looking for a condo. Honestly I think it was a little overpriced to begin with, so this correction was necessary.
The Micro Droppers
25942 Portafino DR
4 beds / 2 baths / 2,077 Sq Ft
Previously Listed: $950,000
Currently Listed: $949,500
This home is so overpriced right now it’s not even funny! Comparable homes are going for nearly $100,000 less or more. The home has been upgraded, but it’s still overpriced nonetheless. These microreductions might keep it on a hot sheet, but when it’s egregiously overpriced, it won’t do anything to get any lookers in there.24383 West Marquis CT #289, Laguna Hills
2 beds / 3 baths / 1,270 Sq Ft
Previously Listed: $400,000
Currently Listed: $399,500
Moderately priced property – right on par with other homes in the neighborhood. But this price game won’t get you anywhere quickly.
March 26, 2008
Congratulations! You found a house, you made an offer (and they accepted!), you got a loan, and you finished the home inspection… WOW! If you managed to do all this, you deserve a vacation, or at least a round of applause, but first it’s time to close the deal! Here are some tips to help you get those keys.
Everything’s negotiable… even closing costs?
For those home buying newbies, closing costs are costs billed to the buyer at the close of escrow. They are in addition to the down payment and mortgage payments. SmartMoney has a great article on what to expect to pay in closing costs and how to cut them down. After all, everything is negotiable, is it not?
But, who should really pay for these costs? You, the buyer? Your agent? The seller? Well, if you ask the agent or seller, they’ll say you, the buyer. However, what really happens? With these market conditions, agents and sellers are getting creative to get your “business”. Having the seller credit you for closing costs is another way to lower the price without the sellers actually budging on their list price. As for agents, you don’t hear of this happening as much, but you never know. I remember hearing about an agent in Riverside County handing out BMWs and Harley Davidsons just to get business.
Has anyone out there been able to negotiate down their closing costs with the bank? If so, let’s hear about it! I never thought to do this when we closed on our condo and am most curious about it.
Dot your i’s and cross your t’s!
The whole escrow closing process is a little overwhelming, even to the seasoned home buyer. A few things to remember… Don’t hurry – Make sure you have scheduled a few hours free for when you review and sign the truckload of paperwork they throw in front of you. Ask questions – If you’re not sure about something, ask the escrow agent. Take it out – If you’re not comfortable with something, ask if you can line through it. Remember, not everything has to be included. A lot of the language is there to protect the escrow company, not necessarily your interests. Take breaks – If you are like me, you get to the point where you just don’t care what you’re signing anymore… that would be a good time to excuse yourself to use the restroom. While there, do a few jumping jacks or something to wake yourself up.
I’m sure escrow agents hate these tips because many of them just want to get through it as soon as possible. However, don’t feel bad about “wasting” their time… their job is to sit and watch you sign all this stuff, they’re getting a nice check for it, so don’t you worry about them.
No surprises on move-in day!
Check again and again with the seller (or their agent) regarding what is to stay and not to stay. These things really should have been noted on your offer, but it doesn’t hurt to follow up to make sure what is supposed to stay actually does. The last thing you want on your long-awaited move-in day is to find that the curtains, washer/dryer, refrigerator, outside storage shed, and built-in shelving are all gone. Now, there’s a pretty penny you weren’t planning on spending.
This tip sounds obvious, but I’ve heard horror stories. A good friend moved in to find the drapes and the dining room chandelier gone. A neighbor moved in to find everything that detaches from the house gone… including toilet seats, light bulbs, and light switch plates! Yes, it’s illegal for sellers to take these things, in many cases, but buyers rarely go after them to get it back… they’d rather just move on with life.
Other “Tips for Home Buyers” Posts:
Buy New or Old?
The Home Inspection
Just Chill Out for a Minute
Know Your Money
March 26, 2008
Well, how about them apples! Economic reports are showing home sales up and prices down. I wasn’t expecting that news quite this early. But don’t worry foreclosure hounds, this may not be much more than a fluke. On the other hand, perhaps this is a sign that real estate fears are dwindling and there is less hesitation among the masses who have been sitting it out.
Some of you may be feeling a little jittery, wondering if this is a sign of an impending bottom. But listen to the news carefully. Sales are up, yes, but prices are down. Keep in mind too that new listings are still plentiful, interest rates are low and the economic slow down is expected to last through the end of the year. Is this bad news for anyone? Seems not, I don’t see anyone losing in this environment and it’s just the sort of glass full scenario that makes me grin with satisfaction.
So consider this a welcome change from all the doom and gloom we’ve been hearing. Everyone was getting a little tired of the foreclosure record being played over and over again. Personally, I don’t care to listen to another sob story about the lending crisis either. It’s a lesson in the history books and it needs to stay there.
Fence riders, get ready to dust off your jumping shoes. Here’s your chance to hop off and get in the game. This is the perfect time to actively engage and you can do it at your leisure. Finally, the frenzy is quieting down and you can shop, surf and invest without feeling that agonizing sense that something horrible is going to happen or the pressure to buy now or forever miss the boat.
Recent Orange County Sweet Digs Posts:
Santa Ana: Real Estate Market Report
Selling Your Home Like a Dating Service
Chick It Out: Creekside Condos Sold in Orange
Tips for Homebuyers: Buy New or Old?
The Morning After
March 25, 2008
Having spent time in Newport Beach earlier today, it came with ease what I would blog about….Newport Beach of course. Specifically, how to get a piece of the action at the lowest price possible. As my business meeting carried on, I often looked out the window at the beautiful clear blue sky. As I merged on the 73 N. for my ride home, I thought to myself, staying here would not be a bad life at all. Of course there is a little barrier to entry called the price tag. While this certainly eliminates many, it does not eliminate all. So if you have arrived, as those in the O.C. like to say and you think you would like to call Newport Beach home, then check out these bang for your bucks and see what you can get into.
12 Shellprint Ct: $655,000, 4 Beds, 3 Baths, 1,753 SQ. FT. price per square foot $374
280 Cagney Ln: $549,000, 2 Beds, 2 Baths, 1,581 SQ. FT. price per square foot $347
8 Ima Loa Ct: $839,900, 4 Beds, 3 Baths, 1,909 SQ. FT. price per square foot $440
220 Nice Ln: $529,999, 2 Beds, 2 Baths, 1,091 SQ. FT. price per square foot $486
8 Odyssey Ct: $720,000, 3 Beds, 3 Baths, 1,640 SQ. FT. price per square foot $439
545 Redlands Ave: $2,195,000, 5 Beds, 6 Baths, 5,000 SQ. FT. price per squart foot $439
March 25, 2008
I know it’s scary, hold my hand… we’ll get through this market update for Santa Ana together.
Santa Ana has become notorious for sub-prime lending debacles, flippers gone awry, and good old poor market conditions. The last check I did on the status of Santa Ana’s market was January 15th. Where does over two months later put us? Let’s find out…
The current median home price in Santa Ana is $498,278. This is down 10% from January and down 13% from December. As for inventory, not much has changed. There are 1,154 homes on the market, which is 2% less than January (22 less homes). The same is pretty much true for the average number of days on the market homes are. They’re currently at 107 days on the market, up 7% (7 days).
The market action index continues to fall to a new low of 16.51. This is a 3.5% drop from January and 4.6% drop from December. A market action index below 30 means it’s a buyers market… pretty soon sellers will be paying buyers to take their properties.
Data and graphs courtesy Altos Research.
And, my favorite… looking at the opposite ends of the spectrum in the market. Below are properties that have just been listed and properties that have not (and not for awhile!).
Properites Just Listed
3018 West Mark St, Santa Ana 92704; 4 bed/2 bath house; 1,459 sq ft; $465,000
318 East Wisteria Pl, Santa Ana 92701; 2 bed/1 bath house; 897 sq ft; $300,000
1018 North Cabrillo Park Dr #H, Santa Ana 92701; 2 bed/2 bath condo; 1,007 sq ft; $239,000
Properties That Have “Been Around”
1622 West Cubbon St, Santa Ana 92703; 3 bed/2 bath house; 1,147 sq ft; $560,000 (down from $570,000); 360 days on the market
521 South Lyon St #115, Santa Ana 92701; 2 bed/1.5 bath condo; 980 sq ft; $190,000 (down from $360,000); 371 days on the market
112 East Pine St, Santa Ana 92701; 2 bed/2 bath house; 757 sq ft; $399,000 (down from $474,000); 384 days on the market
March 24, 2008
For homebuyers, scouring through online listings is much like a dating service. Just like an online dating service, you plug in your criteria and search away. Then you look through pictures and read descriptions to choose which “winners” there might be. Today, potential homebuyers do the same thing online, so it’s important to remember to choose your pictures and descriptions wisely. For sellers it’s important to have good pictures that make the homebuyers eager to come see your place. So today we’ll look at what you should do and some examples of how this wasn’t done.
I know I can’t directly link the pictures here at risk of breaking some sort of copyright law, but it’s worth the click to see the picture to learn the lesson.
Make Sure The Carpet Matches The Drapes. Stop thinking that…and I don’t mean it literally either! But honestly, be sure that what the description claims matches the pictures! One of my friend’s bought their home and was told it had “stunning ocean views”. Of course, a slight glimmer of the ocean could be seen standing atop the master toilet, looking slightly to the left. If you’re going to market yourself as a long and lean redhead you don’t want to have a picture of yourself with a double chin and blonde hair. In the same way, be careful what you claim and display.
The offender: 22112 Bianco, Laguna Hills
The description of the home is sparse but includes the details, “Newer windows and nicely landscaped”. By nice, did you mean to include that old tire, cardboard box, and bag of garbage? (click here)
Additionally, showing a cute fountain in the backyard would seem like a good idea to highlight the “nice landscaping”. However, showing a dried up fountain with dead, overgrown shrubbery…not so much. (click here)
Highlight Your Best Assets. If you’re an impatient person who can’t make it more than 1/2 mile down the 5 without cutting someone off you shouldn’t market yourself as patient and easy going. If your best side is your left side, you certainly won’t post a close up of your right side. In the same way, be sure to highlight the best features of your home in the pictures you post.
The offender: 22301 Modina, Laguna Hills
This home uses 2 of the 9 pictures to highlight a mess of a backyard. It looks like a makeshift campsite back there! There are almost too many things to mention here. But first, moving the two bags of garbage to the side would have been great start. There’s a quasi-wall and a even a desk outside for those who want to be inspired by nature while they work. An extra door, some extra wood…I hope you weren’t planning on entertaining back there! (click here)
Get Rid of Extra Baggage. Baggage – we’ve all got it. But most online daters would probably strive clear of anyone who posts their entire life history on their page. Don’t talk about how your mother lost you at the grocery store when you were three and now have severe abandonment and anxiety issues to this day from it. Save it for another more appropriate place (like a therapist’s office). In the same way, don’t clutter your pictures. It only signifies to the potential buyer that your home is short on storage (or that you are too lazy to use the storage).
The offender: 22301 Modina, Laguna Hills
Apparently there was no shortage of couch cushions and pillows that day. Maybe there was a sleepover, maybe they came from the quasi-room addition in the back. Needless to say, they could have and should have been moved for a quick snap of the picture. (click here)
Additionally the bathroom is victim as well. While I applaud your efforts to keep your cleaning products handy (though I question their use due to the spotty, dirty mirror), storing them on the back of the toilet tells your seller there is no storage for them which is a big no no. (click here)
And lastly, I’m pretty sure that the blue bucket is the interior to a toddler potty training seat. Placing that in your picture on the sink is as bad as advertising that you don’t shower and have really bad hygeine on your dating website. Big no no…just don’t do it. (click here)
March 24, 2008
Weary from so many years of feeling like buying property in Southern California would never again be a possibility, lots of people are very excited about the depreciating market and beginning to think this is the time to jump in and scoop up their piece of the pie.
Be forewarned, though, this is not necessarily an easy market for buyers. Opportune, yes, but not a cake walk by any stretch. There is a lot of craziness with pricing strategies and asking prices are all over the place. It can be confusing and sometimes even deceptive. Auctions are exciting but they can lead to compulsive over bidding and there are sometimes unspoken bottoms that don’t allow as much flexibility in the process as you might think.
Everyone’s got the foreclosure bug. Short sales, repos and bank seizures may make it seem like there is a good deal to be had. Sometimes that’s true but sometimes it’s not. I see asking prices on foreclosures all the time that don’t appear to be really rock bottom deals. There is a certain hype and hysteria surrounding these purchases but the reality is they are tough transactions and you need to be prepared for a whole lot of frustration.
So, what’s an eager buyer to do? Homework, research and careful consideration of your own motivations need to be your primary benchmarks in deciding when and what to buy. Take baby steps and be careful as you consider your choices. Remember, there is a lot to choose from. You can and should be your own best advocate. When you’re armed and ready, go out and get ‘em!
Recent Orange County Sweet Digs Posts:
The Irvine Market Report: March 2008
A Helping Hand
That’s Crazy Talk!
The Domino Effect
Like Wild Animals
March 24, 2008
Chick, chick, chick it out!
Creekside Community is located in east Orange halfway between El Modena High School and Santiago Canyon College. Mainly made up of two bedroom units with in-unit laundry and fireplaces, the complex is complete with a “refreshing” pool and clubhouse. HOA dues run about $330. Below are sold stats on a recent sale and one unit currently on the market.
SOLD:
5927 E Creekside Ave #35, Orange 92869
2 bed/1.5 bath; 1,088 sq ft condo
List price: $330,000
Listing history:
Reduced from $365,900 to $347,900 on 9/2/07
Take off the market late September
Put back on the market on 10/3/07 for $330,000
Details: Built in 1981. Nicely updated, fireplace… wood or wood-like floors.
FOR SALE:
5927 East Creekside Ave #27 , Orange 92869
2 bed/1.5 bath; 1,088 sq ft condo
List price: $379,900
On the market: 158 days
Details: Built in 1981.
March 23, 2008
Recently, we took our monthly look at housing numbers for the Costa Mesa market. Today we’ll look at the Irvine housing market numbers.
First, following is a look at the data that combines the numbers for condos and detached homes in Irvine. As shown by these numbers, the hopeful homesellers in Irvine are too hopeful. They have increased their asking price from what they asked last month (see average listing price below). There are two problems with this: First, the price that Irvine owners were asking last month was already well above what Irvine houses were selling for. Second, the price that homes in Irvine are currently selling for is down, not up, from the previous month (see average sales price below). Most likely the market will provide a reality check for these homeowners.
Average Listing Price for Week Ending March 12: $1,023,403— on February 6: $971,094
Average Sales Price for Dec 2007-Feb 2008: $743,982— for Nov 2007-Jan 2008: $797,749
Median Sales Price for Dec 2007-Feb 2008: $619,000—for Nov 2007-Jan 2008: $650,000
Average Price/SF for Dec 2007-Feb 2008: $365—for Nov 2007-Jan 2008: $369
And…
Number of Sales from Dec 2007-Feb 2008: 398
Number of Sales from Sept 2007-Nov 2007: 413
Number of Sales from Dec 2006-Feb 2007: 535
Source: Trulia
Next, the charts and numbers for detached homes as provided by Altos Research. These numbers and charts show a situation that is similar to what is occurring in Costa Mesa (and I am guessing most of Orange County): All the indicators, except the number of homes on the market (inventory) and the Market Action Index, continued to move deeper into the buyers’ favor. The Market Action Index is tied to the number of homes on the market: The more inventory that is on the market the more likely that the Market Action Index will go up, which is the direction that the homesellers are hoping for. But as I said in “The Costa Mesa Market Report: March 2008,” the other indicators are so strongly in the buyers’ favor that I wouldn’t put much significance in this decrease in inventory in Irvine (or Costa Mesa). However, it is worth watching in the coming months.
On March 16, 2008, the Altos numbers for detached homes in Irvine were as follows:
- Median Sales Price: $922,371
On February 17, 2008: $943,718
On January 13, 2008: $961,225
- Price Per Square Foot: $416
On February 17, 2008: $421
On January 13, 2008: $426
- Market Action Index: 16.62
On February 17, 2008: 15.86
On January 13, 2008: 16.11
Note: The Market Action Index shows the balance between potential buyers and sellers, in other words, the balance between supply and demand. Above 30 is a sellers’ market; below 30 is a buyers’ market.
- Average Days on Market: 106
On February 17, 2008: 103
On January 13, 2008: 94
- Number on Homes on the Market: 413
On February 17, 2008: 416
On January 13, 2008: 442
Also, see last month’s report: “The Irvine Market Report: February 2008.”
