Team Stein Blog

West Los Angeles Market Update

Home prices in 20 major U.S. cities fell 0.2% in November compared with October on a not seasonally adjusted basis, according to the Case-Shiller home price index released Tuesday by Standard & Poor’s.

Prices are down 5.3% in the past year, compared with a 7.3% decline in October. A year ago, prices had tumbled 18.2%.  The index shows prices in the 20 cities are down 32.6%
from the peak.  Prices are the same as they were in late 2003.

Payrolls fall by 85,000 after small gain in November

Non farm payrolls fell by a seasonally adjusted 85,000 in December following a revised 4,000 gain in November, which was the first increase in payrolls since December 2007. During 2009, payrolls fell by 4.2 million.

The official unemployment rate remained at 10% in December as the labor force contracted by the largest amount in nearly 15 years.

After averaging nearly 700,000 a month in the first quarter of 2009, job losses decelerated to an average of 69,000 in the fourth quarter.  

Republicans said Obama was the problem. “The Obama-Pelosi legislative agenda has continued to hinder job creation,” said Rep. Jeb Hensarling, R-Texas. “Republicans believe jobs are created when taxes are low.”

Jobless Rate Stays at 10%

The official unemployment rate held steady at 10% in December as the labor force contracted by the largest amount in nearly 15 years.

Since the recession began two years ago, payrolls have fallen by 7.3 million. Next month, the government will incorporate annual benchmark revisions that will likely push the total jobs lost to more than 8 million.

Now, the good news…after today’s news above, interest rates should stay relatively flat until we see some kind of major recovery in the job market.

Have a great weekend! 

Tax Credit Extension & Expansion is Approved!

President Obama has approved a bill for the Housing Tax Credit Expansion and Extension. Here’s what it means:

The $8,000 First-Time Homebuyer Tax Credit is Extended!

·         Now, qualified first-time home buyers would receive their $8000 tax credit if they sign a purchase contract by April 30, 2010 and close by June 30, 2010.

·         The home purchased must be their primary residence

·         Buyer cannot have owned a home during the past three years

·         Tax credit is up to 10% of the home value (not to exceed $8,000)

·         Annual income caps to qualify for the tax credit have increased ($125K for single filers / $225K for joint filers). Partial tax credit can be granted for incomes up to $145K for single filers / $245 for joint filers.        

PLUS New $6,500 Tax Credit for Current Home Owners Purchasing a Primary Residence

·         Eligible home buyers must have lived in their current home for 5 consecutive years of the past 8 years.

·         The new home does not have to cost more than the old home.

·         Eligible for homes with purchase agreements signed between November 6, 2009 and April 30, 2010, and close by June 30, 2010

·         Annual income caps to qualify for the full tax credit  ($125K for single filers / $225K for joint filers). Partial tax credit can be granted for incomes up to $145K for single filers / $245 for joint filers.

For the first time since the $729,750 ”High Balance” conforming limit was put in place, rates for the 5/1 ARM have fallen below 4.000%.  I know that many buyer’s are not interested in this short-term loan program but it can be a psychological lift in getting these buyers out on the street to take advantage of these historically low rates, even for the current fixed programs.

The Fed started their two-day meeting this morning and prediction is that the 11:15, local time, announcement tomorrow morning will be that interest rates will stand pat.  This really doesn’t affect mortgage rates directly but can influence a future direction.  What it does affect are credit card rates and the Prime rate, which is tied to HELOC (Home Equity Line of Credit) mostly issued to borrowers for a 2nd mortgage.

Rick A. Lombardo
Home Mortgage Consultant

Prudential California Realty
881 Alma Real Drive #100
Pacific Palisades, CA  90272
Tel:   310.230.3715
Fax:  866.494.7032
Cell:  310.435.7439

Multiple Offers — How Do I make sure my offer is accepted? 

The market is picking up for the time being..  Another Pacific Palisades new listing has come to market, priced particularly well and seems to be going in multiple offers.  The fact that we have multiple offers at all coupled with the fact that we have an opportunity in this market to go much higher than listing price is proof positive that buyers are out there and ready to buy.  Further evidence of this positive buyer sentiment is the fact that in the past month we have seen multiple offers on Via De La Paz, Donaire, Monument, Mount Holyoke, Livorno, Palmera and Hartzell.

So how do we navigate now that we are dealing with multiples once again?  It seems that nothing can assist the agent and buyer as much as good thorough communication with the listing agent and the seller.  Find out what the seller wants as well as what the seller’s agent wants.  Give them what they want.  Be creative, where you cannot accomodate them, do your absolute best creative work to attempt to offer them the same outcome that they described to you as wanting.  Keep your contingencies short - sellers want to be sure about you and your offer.  Keep your close of escrow short if that accomodates the sellers needs.  Offer the highest price that you can stomach and offer a high percentage of cash vs. loan.  Present to the agent in person if they will allow that.  If none of those ideas work, offer to release funds from escrow into the seller’s bank account after contingencies are removed. 

Do what it is that you need to do to make your offer stand apart from the rest in terms of it being exactly what the seller is looking to achieve.  These are just a few ideas that we employ when in multiples.  There are many more strategies that we employ for many different types of situations.  With home prices substantially lower than the past few years, with rates lower than they have been in 40 years and with a significantly greater number of homes on the market to chose from, the time appears to be now to consider buying.  Go in to win if you are in multiples!  Good luck and call us if you need any assistance! 

Elizabeth and Jim

Home Sales in Pacific Palisades are picking up!

just have a look at some very quick results from the past month and past few weeks. 

In the past month, 16 homes have sold in Pacific Palisades and 11 of those homes have sold in the past two weeks.

In terms of new escrows opened, there have been 10 homes that have opened escrow in the past two weeks in Pacific Palisades.  Two of those homes were new construction in the $2mm’s and $3mm’s price ranges.

So, in total it looks as if in terms of pure numbers of homes closing and opening escrow, the activity is picking up.  Buyers take note!

To be sure, we need a few months of continued activity before we can claim that this market is in recovery mode. 

As for this moment, there are incredible buys still out there.  Just look at 601 Erskine!  This is by far the best value in the market right now!  There are many others that are fantastic deals as well.  Just look at 700 Ocampo at $1,095,000, 1885 Michael Lane at $1,659,000 and 826 Alma Real at $1,939,000.  Those are by far the three best deals in all of the market right now and they are the best deals by a LONG SHOT!  These are the deals that should be selling in multiple offers right now. 

Give us a call if you would like more information on these homes.  We are happy to share our thoughts and be of help. 

As head of this year’s Pacific Palisades Junior Women’s Club Home Tour, I am reporting that this year’s tour is planning to be a hit!  We have three confirmed homes all of which are absolutely stunning!

This year, the tour will focus entirely on The Huntington area of Pacific Palisades.  We will have three homes all of which are in the Huntington and all of which will have a separate theme - one “Green” theme, one Holiday theme and one Birthday Party/kids theme. 

Some of the best Interior Designers in the area have generously donated their time to our Tour and their absolutely gorgeous design will be in each home.  Designers include:  Natasha Quinn Page, Daniel Pontius, Susan Jay and Sandy Weinstock.  If you haven’t seen their homes, they are simply a must see. 

Along with Interior Designers, we will have a full staff of Decorators, Accessories, Rugs and other companies who will be donating their time to the club. 

The date is Sunday November 24th so mark your calendars for a day of fun and celebration!  This year is our 24th Annual Pacific Palisades Junior Women’s Club 2009 Home Tour so it promises to be a wonderfully special for all!  We hope to see you in the homes! 

Creating a Successful Home Sale in Pacific Palisades, Santa Monica, Brentwood and Malibu requires a good amount of work in this or any other market but nothing delivers like the one irreplacable fact that you have to have a like mindset with your agent.  Check your mindset when talking with agents — are you agreeing with them or are they giving you research that you don’t care about in a way that doesn’t speak to you?  Are you connecting with them or are they talking AT you?

As listing consultants and top 1% of listing agents in our area, we look for that connection with a client during our listing consultation.  We ask them questions that reveal what is important for them and then we talk about how we can imagine getting to that end.  If we value the same things, then we will connect.  If we do not, we will be always misstepping.  The true connection is magical and the results can be incredible.  A connection that does not work can be the most painful thing imaginable.  One promise is for sure, if you are experiencing pain during what is a very intense process, it can be emotionally draining and it is almost certain that you will not get the best sale of your home because your central relationship is faulty. 

So, when you sit down with agents, see who you best fit with.  Ask them very pointed questions and see if they ask you the appropriate questions to fully understand your position now and further, what you want to achieve in your home sale. 

If at any time during the relationship, you feel the relationship unraveling, this is the time to cut bait.  We recently had a seller who began taking “expert” advice from an agent in the San Fernando Valley.  The MINUTE it began, I knew the sale was less likely.  They began doing things that may work in the Valley but they certainly don’t work here.  The sellers were roundly criticized for their actions (even laughed at!) by other agents, clients and even their own neighbors!  The energy began to leave the relationship and they actually tried on a number of occasions to to around us in an attempt to avoid paying us for bringing in buyers.  At that point, the relationship was completely gone and it SHOULD have been cut off by us far before that point. 

LOOK FOR THE MAGIC in your appointments with agents.  See if they are interested in YOU!  Please call us and we can share our process with you for getting to know our clients needs and objectives.  That takes time.  Once we know that, it is a puzzle to be put together — and it works!  It can work brilliantly if your connection is seamless!  After a connection is made, there are specific steps to take particularly in this market at this time in Real Estate Marketing.  Call us and we will be happy to share our systems with you!

Elizabeth and Jim Stein

Mobile 310-902-4436 

Buyers Beware!  This Market Won’t Last Forever!

As some buyers are out contemplating whether the market is at the bottom or not, we offer this sentiment and here is our reason why — we are at a serious market low that offers incredible values.  Warren Buffet says it best, if he buys within 20% of the lows and sells in the within 20% of the market high, then he is happy.  He has given up the illusion that he will time it perfectly each time he buys and sells. 

What do we see in this market?  Buyers who are out there somewhat stifled by how many great values there are now.  Instead of jumping on some of these opportunities, they are more cautious than when the market was higher. 

So here we are in a market where the unbelievable values abound.  HERE is the interesting point from a very local perspective — there is seemingly a ton of cash out there.  In the recent past, if a home were priced in the $1.5 million or under range, people would buy them up as quickly as possible and often in multiple offers while the $2 million and above price range took a little longer to sell.  In this market, the exact opposite is true:  homes priced under $1.5 million are slower to move because often these buyers need financing and that is very tough for people to secure still.  The over $2 million market is thriving because the investors who have been waiting on the sidelines are jumping in and they are jumping in with all cash.  They see properties on the market for a while and they jump at the opportunity to purchase at that said price.  When they jump, they go in with all cash and they are getting what they want!

So, the question is, if the investors are coming with all cash and they are feeling that the time is right to invest, then why is the buying public still waiting it out?  Are they waiting for all of the risk to be deleted from the market?  If this is the case, then we know from past markets that once all risk is removed, the market will have already corrected with higher prices and then they will have to deal with higher prices. 

We truly believe that purchases made now will only be treasured later.  We believe that the market in West Los Angeles destinations including Pacific Palisades, Brentwood, Santa Monica and Malibu may hover at its current levels however it will go back up and it will do so mightily.  The people who do not buy now will find themselves regretting the fact that they let this market slip away. 

The values are out there now!  Just go out on a Sunday and see for yourself!  And if you disagree, please contact us, we would love to hear your thoughts! 

Jim and Elizabeth Stein

310-902-4436 Elizabeth

310-991-4260 Jim