Here is the real scoop on what's happening in the real estate market. First of all, don't just stand there...BUY!! The whole reason the median price of a single-family property increased so rapidly the past 60 days, (more on prices in the next paragraph), is because interest rates jumped more than a full percentage point. Between that increase and sellers demanding greater increases than the market could bear, sales slacked off in the price ranges most susceptible to interest rate increases, namely $250,000 to $750,000. Without the volume of those sales to temper the million plus purchases, the median price shot up. Many families were forced to the sidelines with the interest bump. Now, they can return, because in case you didn't hear... rates are back down, low...really low. Also, during the past 60 days, more property has hit the market, inventory levels are much healthier, creating more competition for sellers. This will naturally keep prices in check to a normal appreciating market. Don't miss out on the great rates again. Go out and find your dream home! The Federal Reserve has made it clear in recent articles and blogs that the U.S. economy still needs support from its low interest-rate policies, because it is growing only moderately. After its policy meeting, the Fed also announced that it will continue buying bonds to the tune of 85 billion a month to keep those rates low and encourage borrowing and spending. The question is: does that mean through first quarter next year? Or possibly second quarter? If buying a family home, to raise your family, spend your quality time, now may be your time.
Sunday, December 1, 2013
According to all sources, including, the LA Times, the OC Register and DataQuick, the So Cal area's home price gains for August and September are the highest since '05. Before we get too excited, let's remember what we discussed in the last section of this newsletter. The sheer number of deals in the upper price range and cash transactions in the multi-million dollar range had a lot to do with the increase. Lack of inventory also drove up prices. Expect them to soften somewhat because of the increased inventory we wrote about. The number of sales in Orange County for September (the last complete month available) is 2,916. That number was up 8.9% from the previous month year over year. The median price for all properties was $550,000 up 22.2%. However, the median price for a single-family was $612,000 and that is a 20% increase from the same month of 2012. The median price for a condo was $380,000 and that was up 24.6%. The volume for the number of sales for single-family was flat with 1,807 sales, but condos rose 16% in volume to 836. The median price was highest for new homes at $696,000 but the sales were a paltry 273.
A recent article in the OC Register reported a 5 year prison sentence for a man forging deeds on vacant properties and then renting them and collecting those rents. The unfortunate part of this scenario is for the homeowner who may have moved out of a distressed property or simply moved and had not yet disposed of the existing property and now have to deal with tenant's rights, as well as a forged deed. Fortunately, the ALTA Residential title policy protects against after close of escrow forgery. Not all title companies issue this policy or do so automatically without Western Region Exceptions, but Fidelity National Title does. Always check to make sure you receive this superior title policy when you are purchasing a home.
There are many cheap, easy (ok maybe a little effort involved), ways to help buoy your asking price when you sell your home. Here are a few. (For even more info, go to www.kcmblog.com) First off, we are mainly talking about curb appeal, and a few cosmetic things inside your home. Curb appeal is huge, because buyers always look at homes initially based on their visual, emotional, reaction to the home. Make sure your roof is repaired and will pass for a one year roof certificate. Gutters should be cleaned and repaired. Invest a small amount of cash in really cool numbers for your address on your home's facade. Windows and trim should look newer, with no cracked paint. Wash your home's face, get the dirt and grime off it and add $10,000 to your sales price! Upgrade your front door to a snappy color or etched glass or trim. Replace old light fixtures for a more modern, with it look. Brush up your landscaping with a few new plants or flowers. Inside, think about replacing carpet with tile (if time or money), otherwise get your carpets cleaned. These types of changes require mainly, time, a little money, but could result in better and more offers for you.
Sunday, August 4, 2013
According to KCM Blog, a real estate blog, well documented with national sources and valid statistics, and a recent job report regarding wages, give great evidence that there is no bubble. Talking about the possibility of a bubble has made for good fodder both in the papers and on cable newscasts. However, take a look at the following and you will find some compelling reasons to keep an open mind and draw your own conclusions. 1) 41% - Percentage of homes being bought where payment is cheaper than renting. 2) 16 X's - The ratio of home prices to rents in the first quarter of 2013 is slightly better than long-term average. 3) 8% - The percentage housing is still undervalued on a price to income ration. 4) 91% - Percentage of the country which is still undervalued. 5) Pent up demand / Low inventory. 6) Wages are rising. We aren't even mentioning larger down payments, stringent loan qualifications and number of owner occupied versus investors is rising significantly. Finally, has it been mentioned the renewed perception that home ownership is once again a great investment?
The entire Southland hit a sales high in May, the highest in 7 years. The median price hit a 5 year high. According to records kept by DataQuick, there was a total of 23,034 new and resale houses and condos sold in LA, Ventura, OC, SD, Riverside and San Bernardino. That was up 7.6% from the previous month of April, and 3.8% up from May 2012. However, there is still room for growth, as May 2013's numbers are still off 10% historically of what May usually produces since DataQuick started keeping records in 1988. The total number of sales for all properties in OC was 3,648, up 11% from May 2012 and the median price was $540,000 up 24% from a year ago. The number of resale homes was 2,347, condos came in at 1,013 and new homes still lagged, from lack of product, at 288. Million dollar homes are making a big comeback, recording the highest number of sales since 2007. For all of last year, 2012, there were 26,993 homes sold at $1,000,000 or higher. That is up 27% from 2011.
Reason #1 -- According to S&P/Case-Shiller, prices will continue to rise in 2013. In fact, they adjusted their original forecast of 8% to 11%. Reason #2 -- Mortgage rates will continue to rise. According to Freddie Mac, 1/2 a point interest has already been factored in and likely will stay there for the time being. But don't test providence. Reason #3 -- It is time to make a decision. The time for hesitation, waiting for the bottom of the market, has come and gone.