South Bay-Beach Cities: Sold April 2009

Bike Path... Manhattan Beach

When you review sales in the South Bay-Beach Cities a few things stand out... sales are up and inventory is down a bit from the highs of the last few months. The biggest thing you will notice is that there is a huge difference between the median list price and the median sold price for homes in all of the Beach Cities, with the exception of North Redondo.

The biggest disconnect between the asking price and the actual sale price for homes and townhomes is in Manhattan Beach and South Redondo. In Manhattan Beach the current median list price of a home is $1,899,000 while the median sold price is $1,200,000. In South Redondo the median list price is $1,350,000 and the sold price is $730,000.

There has been a number of articles in the media recently about how sticky the prices have remained in most of the upscale areas in all parts of the country. The general consensus is that prices may soon begin to fall in these areas as the economy continues to falter. In the last few days, with interest rates bouncing around like crazy, there is concern that the flurry of home sales activity in recent months will halt if rates suddenly move upward. I believe that is true.

Pending sales are defintiely up in all the Beach Cities as many sellers have begun to lower their asking price by some substantial amounts. New listings that are priced right are also selling quickly while older listings with high prices continue to remain on the market. I suspect that in the coming months you are going to see prices finally move downward on homes that have been on the market for a long time without finding a buyer. There are a number of properties that have been for sale for well over a year. If owners are serious about selling they will have to reduce the price to a point where potential buyers find value.

The market in North Redondo saw prices adjust in 2007. As prices adapted to the demands of the market rather early we are now seeing the segment of the market possibly reaching the bottom. Last fall you could buy a starter home in North Redondo in the TRW tract for $475,000- $550,000. Those deals are gone. Prices have increased from the lows of October - December. Interest rates have played a part but so have low prices.




South Bay-Beach Cities: Sold April 2009 (click on graph to enlarge)

South Bay-Beach Cities: Sold March 2009

South Bay-Beach Cities: Sold February 2009

South Bay-Beach Cities: Sold January 2009

South Bay-Beach Cities: Sold December 2008

South Bay-Beach Cities: Sold November 2008

South Bay-Beach Cities: Sold October 2008

South Bay-Beach Cities: Sold September 2008

South Bay-Beach Cities: Sold August 2008

South Bay-Beach Cities: Sold July 2008

South Bay-Beach Cities: Sold June 2008

South Bay-Beach Cities: Sold May 2008

South Bay-Beach Cities: SOLD March 2008

South Bay-Beach Cities: Sold February 2008

South Bay-Beach Cities: Sold January 2008

South Bay-Beach Cities: Sold November 2007

South Bay-Beach Cities: October SOLD 2007

South Bay-Beach Cities: September SOLD 2007

South Bay-Beach Cities: August SOLD 2007

South Bay- Beach Cities: July Sold 2007

South Bay-Beach Cities: Sold June 2007

South Bay-Beach Cities: Sold May 2007

South Bay-Beach Cities: Sold April 2007

South Bay-Beach Cities: Sold March 2007

South Bay-Beach Cities: Sold February 2007

South Bay-Beach Cities: Sold January 2007

Memorial Day: In Rememberance

We have lost a number of our young people to war over the years. For my generation it was Vietnam that took so many lives. Today it is Iraq and Afghanistan. It doesn't matter what party your identify with or your stance on the war. Memorial Day is a day to remember all who died in the service of their country.

Local Memorial Events:

REDONDO BEACH
1. The city of Redondo Beach invites South Bay veterans and residents to its 2009 Memorial Day ceremony from noon to 1:30 p.m. at the Veterans Park by the Redondo Beach pier, at Catalina Avenue and Torrance Boulevard.


2. The Rev. Bhagavan Friend will hold his annual commemorative of his Empty Chair Memorial to America's Fallen Soldiers. The ceremony will be at 11 a.m. Saturday at 124 Sapphire St.
For more information, call 310-540-6044 or go to http://www.emptychair.org/


RANCHO PALOS VERDES
The 24th annual Memorial Day Observance at Green Hills Memorial Park will be from 10 a.m. to noon Monday.
Keynote speaker will be Michael B. Donley, secretary of the Air Force.
For more information call Green Hills Memorial Park is at 27501 S. Western Ave. in Rancho Palos Verdes. Call 310-521-4460


TORRANCE
Sen. Jenny Oropeza will be the keynote speaker at a service from 11 a.m. to 12:30 p.m. Saturday at the James Armstrong Theatre, 3330 Civic Center Drive.
The families of those killed while serving in the U.S. military will be presented with California flags that have flown over the state Capitol. Capt. Matthew Ferrara of Torrance, and Specialist Lester G. Roque of Torrance, are among those who will be honored. For more information, visit www.senate.ca.gov/oropeza or call 310-318-6994.

South Bay-Beach Cities: New appraisal changes affect both buyers and sellers

Recently clients made an offer on a home where the seller is utilizing a limited service company. As part of the counter offer the seller wanted to limit the loan approval and appraisal time to 17 days. The seller had been consulting with a "friend" who told him 17 days was more then enough time to get full approval. Obviously the "friend" has not closed a transaction for some time. A few years ago when obtaining a loan was fairly easy and 30 day escrows were common it was possible to get full loan approval in 17 days and that time frame became the norm on the CAR contract of purchase.

However there have been some changes in recent months that make the old time frame no longer workable. Once I explained to the seller about The Home Valuation Code that went into effect on May 1, 2009, he had no problem with a longer time frame. The code established new rules about appraisals and that with the changes there was no way to get approval in such a short period of time. In fact as these changes work their way through the system I'm guessing you will see 25-30 days contingency periods re-emerge as normal time frames.



Since last fall when lenders started tightening up their requirements it has been difficult obtaining full approval in 21-25 days. Now with the changes in the appraisal rules it's going to take a lot longer for a borrower to obtain full approval. The new rules are going to have an effect on both buyers and sellers, so it is important that all parties understand just what is happening. The LA Times had a decent article about the new rules in the Saturday May 17, 2009 business section.

The gist of the changes is that lenders can no longer contact appraisers directly. They are not allowed to order an appraisal by calling an approved appraiser but must instead order the appraisal through a third party company. The borrower must pay the appraisal fee upfront via a credit card to the third party company before the appraisal can be implemented. That company then places the order with one of the appraisers who have agreed to work for them. Banks are not allowed to contact the appraiser at any time for any reason. They can't call up Joe the appraiser and ask where the appraisal is that was due last week. The only contact banks can have are with the third party company.

On the surface this looks to be great.. lenders can't influence appraised values. No inflated values allowed! Transparency in the market at last! Everybody wins! The problem is that , as with all government "new rules and changes", the changes may not prove to be quite as beneficial as the press announcement that preceded them touted.

There are a couple of kickers in the deal that will probably make for new legislation fairly soon. First is that appraisals are going to be a lot more expensive. The "new appraisal companies" are charging a lot more money for an appraisal as they have a lot of overhead. However they are actually paying appraisers less money. This means that experienced appraisers will probably not sign up with these companies.... making the staff for most of them likely to be newly licensed and relatively inexperienced.

The second thing, and to my mind the biggest problem, is that appraisers will probably not be local. Those of us who have been in the business for awhile remember how much fun it was to have an appraiser who lived in Barstow show up to appraise a home in the Sand section of Manhattan Beach. These guys always had trouble with how little lots and houses could cost so much. I remember one guy who thought living so close to the water was a real problem and downgraded the price because there could be rust and mold from all the damp salt air. Homes in east Manhattan often fared even worse. As a rule of thumb if there are not sufficient comps in a neighborhood the appraiser can choose comps within a 2 mile radius. Used to love getting those comps from North Redondo and Hollyglen for a home in the 1300 block of 5th Street.

So what does this mean for borrowers and homeowners. For starters if you are buying, selling or refinancing you will need to plan on a longer time frame to get loan approval. Formal loan approval is always subject to the appraisal being at the sale price or the price needed to establish value if you are refinancing. This may mean that a 30 day escrow is not very realistic so all parties need to plan accordingly.

Another fly in the ointment is that as there is no guarantee that the appraiser will be either local or experienced you can have some real issues about value. Now you skeptics out there may think this is great... lower appraised price means paying less for the property... maybe and maybe not. If the issue becomes a real problem sellers will start demanding changes in the appraisal contingency rules and will likely force buyers pay for a review appraisal if the price comes in too low. The same will be true for those folks who are refinancing... if you need a higher value you might find yourself having to pay twice in order to get a review appraisal done if the old one seems too low.

Overall the new rules or the form they ultimately take may prove to be beneficial for everyone. I would like to see the government make a few other changes... namely that all lending fees be spelled out before a borrower fills out a loan information sheet so that borrowers could really check what companies are charging.

Beach Cities: Homeowner Information about asbestos

I was recently asked to pass along information about Mesothelioma from the Mesothelioma Cancer Center. The cancer center, as a public service, wanted to try and get information to the public about problems that might be found in homes built before 1980 that still have asbestos.

Asbestos becomes a problem only if it becomes friable... that is crunbling. If the asbestos product is in good condition then there is no problem. Hi-Tech Environmental Services in Manhattan Beach will test any material you think might contain asbestos. They are very inexpensive and quick. They will also remove asbestos products.

Below is the article from the Center:





Homeowners Implementing Green Alternatives to Asbestos in the Home:



The state of California provides a great environment for active lifestyles and is regarded as one of the top states to call home. The path to owning a home is an exciting time for everyone, but one that will bring additional responsibilities. Utilized in thousands of construction and building applications throughout the 20th century, asbestos was a highly regarded mineral due to its heat resistant properties.

Potential Manhattan Beach or South Bay Real Estate home buyers or those remodeling older homes should be aware that homes built before 1980 may still contain asbestos. Due to a steady progression of technology and green sustainable methods, there are many ways to ensure your home or property is asbestos free.

With a variety of home materials on the market still not banned b the federal government, there has been an overwhelming amount of concerned citizens regarding asbestos exposure. California is one of many states implementing sustainable methods of construction. Many new homes that are foreclosed may require renovation or repairs, especially in areas susceptible to natural disasters. This process may require inspection for hazardous materials.

Asbestos exposure is easily prevented by taking simple precautions. Although un-damaged asbestos does not pose any harm, you should be aware that the inhlation of airborne asbestos fibers can cause mesothelioma, a severe lung ailment associated with asbestos exposure. Mesothelioma treatment has varied affects on individuals, with many factors impacting physician prognosis. These include age of diagnosis, latency period and age of diagnosis.

The amount of asbestos-related incidents in the last few decades has lead to asbestos lawyer firms advocating victim rights around the U.S. The negligence involved with the asbestos scandal has been one of greed and dishonesty. Manufacturers of asbestos were aware of its toxic qualities, but repressed this information from the public.

If any asbestos is suspected, the best advice is to leave it un-disturbed. . Sometimes the best action is no action. A home inspector can determine the proper course of action. Asbestos removal in public facilities, homes and workplaces must be undertaken by a licensed asbestos abatement contractor. The removal of asbestos is a finite process that must be done by a professional.



Green alternatives to asbestos include the use of lcynene foam, cotton fiber and cellulose. Cotton fiber is made from recycled batted material and treated to be fireproof. A water based spray polyurethane foam, lcynene features no toxic components.

Recently, congress passed the American Recovery and Reinvestment Act into law. Included in this act were extensions to the tax incentives placed for energy efficiency in 2005, as well as new credits for homeowners who remodel or build using eco-sustainable methods. Existing homes are eligible for a series of efficiency measures that pertain to the home shell (Insulation, Windows, Sealing) worth 30% of the installed cost (materials only, labor is not included in the credit basis).

Manhattan Beach: Market Snapshot May 11, 2009

Manhattan Beach... Days on Market May 2009

April and May continue to see better sales volume numbers then January-March. The middle and entry levels seem to be be moving... slowly perhaps but they are moving. There are 48 pending home sales, 11 are priced under $1million... 12 of the sales are priced from $1.0- $1.6... 16 are priced at $1.6-$2.0... 7 are between $2.0-$3.0...while 2 are over $3 million. There are 15 pending townhome sales of which 7 are under $1.0...6 are $1.0-$2.0 and 2 are over the $2 million mark.

While the number of homes over $2 million for sale has increased there isn't a lot of movement in the upper price levels. There are 87 homes for sale priced at $2 million plus. At least 24 of those have been listed for 200+ days. There are a number of reasons of course.

The economy is still in a lot of trouble and a lot of folks who had money last year may not be quite as flush this year. It's still tough to find a loan over $1.5 million. You may have a large down payment but if you are not a member of the Private Bank crowd you will find financing tough to obtain and expensive. Also, as with all price levels, many of these homes are simply priced higher then they should be if they want to sell. Finally, a number of these homeowners are not in dire straits and don't have to sell. They will sell if they get their price... if that doesn't happen... they will take the home off the market until the market changes.

Manhattan Beach: Market Snapshot May 2009(click on graph to enlarge)

Manhattan Beach: Price Ranges May 2009

Manhattan Beach: Market Snapshot April 14, 2009

Manhattan Beach: Market Snapshot March 14, 2009


Manhattan Beach: Market Snapshot February 10, 2009

Manhattan Beach: Market Snapshot January 19, 2009

Manhattan Beach: Market Snapshot December 4, 2008

Manhattan Beach: Market Snapshot November 8, 2008

Manhattan Beach: Market Snapshot October 13, 2008

Manhattan Beach: Market Snapshot September 15, 2008

Manhattan Beach: Market Snapshot August 19, 2008

Manhattan Beach: Market Snapshot July 17, 2008

Manhattan Beach: Market Snapshot July 7, 2008

Manhattan Beach: Market Snapshot June 20, 2008

Manhattan Beach: Market Snapshot June 5, 2008

Manhattan Beach: Market Snapshot April 29, 2008

Manhattan Beach:Market Snapshot April 14, 2008

Manhattan Beach: Market Snapshot March 31, 2008

Manhattan Beach: Market Snapshot March 13, 2008

Manhattan Beach: Market Snapshot February 26, 2008

Manhattan Beach, CA: Market Snapshot February 11, 2008

*There are a few more sales and pending sales not on the MLS that are not included in the graphs.

South Bay-Beach Cities: Homeowners...Good Information if you need mortgage help

In March I wrote a post about government online help for homeowners who needed information about refinancing or loan modification. While the government site can be helpful many homeowners have found that the information there may not have quite fit their situation.

Lew Sichelman is a Washington D.C. columnist who writes a terrific weekly column called The Housing Scene that is usually found in the LA Times Sunday Real Estate section. Lew always provides excellent information for buyers, sellers and even real estate agents. If you don't take the LA Times Sunday edition check out his columns online... you will be glad you did.

Once again Lew offers good advice for homeowners who need mortgage information and or help with their current loans. The guys who gave you FICO scores, Fair Issac, are now offering online help for homeowners who are in trouble with their mortgages. Lew not only gives details about the program but also offers some sage advice to owners who are in trouble and looking for help. Even if you are not having mortgage issues there is a lot of good information for homeowners.

If you are in trouble with your mortgage or think you may have a problem in the future I strongly suggest you read the article. It may save you a lot of grief... not to mention money. I am always happy to answer questions offline for those with specific issues.

The Best Real Estate Blogs in Los Angeles

Relocation.com is a company about ...well ...relocation. They are a terrific resource for those planning a a move to a new area. Recently they have begun a series of posts on their relocation blog naming the best real estate blogs written by real estate agents around the country. This week their focus was on Los Angeles. I am very pleased that this blog was named as one of the Best Blogs in Los Angeles. ( she noted blushing)

It should not surprise those of us in the South Bay that three South Bay blogs were chosen... after all we know the South Bay is a great place to live.

South Bay Real Estate Blogs:

Beach City Real Estate Info.... Kaye Thomas

Red Square Homes Blog... Blake and Diana Roberts

Palos Verdes Lifestyle... Norma Toering

Best Los Angeles blogs not in the South Bay:

Long Beach Real Estate... Laurie Manny

Pasadena Views... Irina Netchaev

San Fernando Valley Real Estate Blog... Judy Graff

Malibu Real Estate Blog ... Michael Gardner

Phyllis'LA Real Estate Blog ... Phyllis Harb

Up2Date Real Estate ... Doug Willis

Terra Firma ... Christopher Hain

Other Cities:

Best Real Estate Blogs in Minneapolis/St. Paul

Best Real Estate Blogs in Chicago

Keep an eye out for new cities to be added ....

It's a Buyer's Market...So Why Are Prices Still So High

Manhattan Confidential, our local consumer blog, posted an article today about the decline in sales in Manhattan Beach and the Beach Cities. The post points out two things... the number of sales began to decline in 2002- 2003 ( higher prices mean fewer sales) and 2006 was when buyers started saying no and the market started cooling. Fast forward to 2009 and we have a real estate market that is trying to recover from a lousy economy and a tough lending market. Yet with all the chaos of the last few years prices, with a few exceptions, are still on the high side.

The issue for many Beach Cities' buyers is that while prices have fallen a lot in Manhattan, Hermosa and Redondo; they don't seem to be down as much as many believe they should be. Every news source is telling potential buyers that California has the largest number of foreclosures in the nation and prices are dropping like crazy. The media posts a new statistic every day on how much real estate prices have dropped in California. There are a glut of articles about buying foreclosures and short sales. So why are prices still so high in the Beach Cities?

Last Sunday the LA Times had a terrific front page article that addressed the issue... why some markets are not acting in the way buyers expect. The main thrust of the article is that while prices are down overall, they may not be down as much in the more desirable areas.... i.e. The Beach Cities as say in Riverside. This scenario is very frustrating for buyers and for sellers. Buyers believe that sellers should accept lower prices for homes that have been on the market for long periods of time. Sellers/Banks, on the other hand, want to sell for as much as they can, especially when facing a loss.


While not everyone thinks this is the time to buy... there are a lot of folks who are willing to take a chance and buy now. Most of these buyers don't think we have reached bottom but believe lower prices along with some very good long term interest rates mean it might make sense to buy. The problem is that there is still a big disconnect between where buyers believe prices should be and the prices that many home owners or in some cases banks are willing to accept. Many of my clients are especially frustrated with the prices that banks are setting for short sales.

While we don't have a huge inventory of REO's... there are a number of short sales in all the Beach Cities. Many of these are new construction that didn't find buyers. A number of builders have received NOD's. Logic would seem to say that as these homes have been on the market for a year or more that Banks would be wise to be fairly aggressive about accepting offers from well qualified buyers...but that isn't what seems to be happening.

We have seen an uptick in sales in the last month. This may be a seasonal reaction... spring is historically our buying season. It could be low interest rates. It could be that buyers are seeing a little light at the end of the tunnel in the economy and the housing market. Personally, I think prices still have a way to go before we see the bottom... but the bottom might not be as low as was predicted a few months ago. The kicker for our market will be foreclosures. If we see a spike in the number of foreclosures over the next 6 months then you can expect to see prices drop quite a bit. If we continue to have relatively few foreclosures prices will continue to be soft but will more likely be flat.