Helping out the Kids (with their first home)

This article from the LA Times highlights how some are Finding ways to help young adults make their first home purchases.

No bubble, even in hottest home markets!

No bubble, even in hottest home markets, a new report says - latimes.com:

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Even the LA TIMES Thinks Now May be the Time to Buy!

Any time the LA Times writes about real estate, it's difficult to know whether to expect which theme will dominate: "doom" or "gloom."  So when they publish an article saying Now may be the time to buy a home, something big must be going on (or the business editor was vacationing).  There is: interest rates are on the upswing as we've been saying for some time.

Don't lose sight of the fact that higher rates reduce affordability, so potential sellers should be as interested in this news as potential buyers.

Now if you check the reader-submitted comments accompanying the Times article online, you're bound to see the doom and gloomers arguing for waiting till rates go up, thinking this will cause prices to crash.  These folks miss two critical points: the crash already happened (not sure how anyone could have missed that), and affordability is hugely impacted by rates.  - David

Side Deals in Real Estate Sales? Bad Idea

Buyers and sellers will sometimes be offered or asked to accept undocumented side deals in real estate transactions.  This is a great way to introduce surprises, disappointment, risk, and potential legal problems into an otherwise clean transaction.  Sound like a good idea?  No, and that's the right answer if you're asked to do so. 

Side agreement forced on you? Look for a new property, a new Realtor, or both. - David

More info: Home-sale side agreement has pitfalls - latimes.com

Case-Shiller says: Prices up in Los Angeles

"One of the few spots that seems surprisingly strong is California."  There's a quote you don't see very often regarding the California housing market, so it's nice to see in response to the latest Case-Shiller numbers. - David

More info: Home prices rise in three California cities - latimes.com

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Bank of America yanks Countrywide Financial customers’ lines of credit - latimes.com

Countrywide/Bank of America home equity borrowers beware:

Bank of America yanks Countrywide Financial customers’ lines of credit - latimes.com

Of course many of us have experienced a lockdown in our home equity lines already, but this is a "wholesale" rollback for a large group of borrowers, and is not based on credit scores or balances. I'd recommend that anyone maintaining an open equity line of credit as a safety cushion for the unexpected double check it's actual availability once and awhile. You can't meet an unexpected need with an unavailable line of credit. - David

Foreclosure auction of Nicolas Cage's mansion is a flop - latimes.com

"Frat house bordello???"  Extreme though it is, here's the best example I've ever seen of why it's so important to depersonalize a home before listing it for sale!

Foreclosure auction of Nicolas Cage's mansion is a flop - latimes.com 

As much as we love living with decor that reflects our own tastes, homebuyers are looking for something to make their own.  They simply aren't interested in adopting our tastes and lifestyle! - David

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What Buyers Want - latimes.com

What do buyers want in a home? A recent survey offers clues.  Builders, gearing up to start new projects once again, rely on surveys to provide insights into how to configure new homes. - David

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The pearl of Manhattan Beach's Strand - latimes.com

Gotta admit, this one's pretty cool: The pearl of Manhattan Beach's Strand - latimes.com

For photos of this home at 1600 The Strand, click here.  As of this posting, the home's been on the market 62 days. More info? - David

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Southern California home prices rise 10% in February - latimes.com

Here's the regional info we want to see. Southern California home prices rise 10% in February!  Foreclosures are down in the area as well.

What's missing?  Stated income jumbo loan financing, which remains nonexistent in any real sense.  So self-employed purchasers looking to purchase larger, more expensive homes must come up with enormous down payments or work with a mortgage broker with access to nontraditional financing sources (ask me for a referral!). - David

IRS tells homeowners how to get tax relief if a lender forgives part of their debt - latimes.com

Here's how to get tax relief if a lender forgives part of your debt.  This is an important point, as debt forgiveness is typically a taxable event (should you be fortunate enough to successfully negotiate a principal reduction or short sale, assuming you're unfortunate enough to need one). 

Early in the housing crisis, the Bush II administration initiated a policy, which remains today, exempting mortgage debt forgiveness from being taxable. - David

Groucho's Place

Not all properties lost value between 2007 and 2010! The 6000+ square foot Trousdale Estates home originally built for Groucho Marx was purchased in 2007 for $4.675 million but listed for sale last August at $12.9 million! That being a little rich, it was eventually reduced to $9.85 million and sold early in February for

Jumbo mortgage market is beginning to thaw - latimes.com

In a very well-timed article (see my immediate past blog post), the LA Times reports that the the Jumbo mortgage market is beginning to thaw.  There isn't much movement yet, and in fact the article quotes what all would-be jumbo mortgage borrowers already know, namely that "For now, the jumbo market remains limited to the volume of loans that banks are willing and able to keep on their books. But there is hope for a return to private outside funding." 

That private funding is exactly what's needed,

Homeowners' equity is again on the rise after three years of unprecedented shrinkage - LATimes.com

We all knew prices couldn't go up forever, right? Well, they couldn't go down forever either, and the South Bay is a good example of a locale where prices are stabilizing. In fact, would you believe U.S. homeowners' equity in their homes is rising?  It's true. - David

Tours of Interesting Homes from LATimes.com

The LA Times online maintains a series of online tours of interesting homes that is updated based in part on how interesting people find them (based on click-thrus).  Some very interesting digs indeed! - David

Will walking away from a mortgage go mainstream? - LA Times

As earlier reported, it's not my intention to endorse what are popularly being called "strategic defaults." Roger Lowenstein, a former editor of the Wall Street Journal's "Heard on the Street" column, writes about the topic at this link:

Will walking away from a mortgage go mainstream?

Certainly walking away from properties that are underwater on their mortgages will have a seriously detrimental effect on one's credit.  But the concept may deserve thought when a property is so far underwater as not to stand a reasonable chance of recovering that difference in value within a meaningful time horizon.  Food for careful thought; ground that should be treaded lightly. - David

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Pending home sales in the West fare better than the rest of the country

Sales in the West look a LOT better than in the rest of the country these days. 

Pending home sales in the West fare better than the rest of the country

Beware of generalized statistics that aren't pertinent to our local area (even these are pretty broad)! - David
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Burj Khalifa Officially Opens - Tallest Building (and Residences) in the World

January 4 marked the official opening of the Burj Khalifa in Dubai, UAE.  The tallest building ever constructed, at 2,717 feet, it will house 900 residences, most already sold in a much kinder market, and an Armani hotel in addition to offices.  Originally dubbed Burj Dubai ("Dubai Tower"), it was renamed at the last minute in honor of the Abu Dhabi ruler who provided a much-needed financial bailout to Dubai in recent months.