1to4plex.com

Beware: Lenders will add an extra step before close of escrow.

1 to 4 Plex — Fri, 21 May 2010 05:39:36 +0000

You are in escrow? Don’t apply for any new credit!

You have been seaching for months to find your deam home in a decent location and you think you have it in the bag, having outbid multiple offers along the way and you are now safely in escrow. Everything is going great, you are a few weeks away from closing and you are already shopping around for all of the home furnishings you will need to buy but, hold on! According to the Los Angeles Times, lenders will now order a new credit report just before the close of escrow, effective beginning of June.

Why? It seems that Fannie Mae wants to crack down on buyers who max out their the credit card while about to buy a property. If you purchase big ticket items on credit during your escrow period, understand that the purchases could jeopardize your lending ratio and throw off your application. And we all know how tight banks are today with their money.

So, if you are tempted by a new car to commute between your work and your new house, think twice. Be patient and wait that escrow has closed. Then you can go and have fun enjoying your place.

How Affordable is Los Angeles Now?

1 to 4 Plex — Fri, 21 May 2010 03:43:38 +0000

Buying a home for sale in the Los Angeles area is getting cheaper, but it can still be pricey proposition. A recent article published by the California Association of Realtors shows that the entry-level housing affordability is 66% for California for the first quarter of 2010. The entry-level housing affordability measures the percentage of households that can afford to buy an entry level property. That index translates to a $246,270 price tag. While the index reached 84% for the High Desert, it hovers at 56% in Los Angeles (San Luis Obispo is the state’s least affordable with 52%). For Los Angeles County, it implies an a $281,700 entry level price, meaning a buyer would need a minimum income of $47,510 and a monthly payment (tax and insurance included) of $1,580. However, in the San Fernando Valley, properties can be found for less than the entry level price. I have a buyer who in in escrow on a nicely redone 3 bedroom/2 bath fixed up condo for $200,000. Not that long ago, another one of my buyesr scorde a 3 bedroom 2 bath condo for a $124,000 price tag. That one was a fixer, but still a great deal. Give me a call if you’d like me to find you your own great deal.

Double Dipping?

1 to 4 Plex — Sun, 02 May 2010 22:42:08 +0000

A recent article published by the California Association of Realtors examines whether we are headed for another decline in house prices. According to the article, the sale of homes decreased by 11.7% from February 2010 to February 2009, while the median price rose to $279,840. Are we gearing towards another dip? The C.A.R. says it is unlikely based on the following elements:

- affordability is twice the level of 2007;
- inventory, although increasing, is still below historical norms.

The big “ifs” that remain are:

- Can the housing market sustain itself once the tax credit are off the table on June 30?
- What effect will recent improvements to the federal home loan modification program have?
- How long will the Fed keep interest rates at rock-bottom?

Others have identified the “shadow inventory” of foreclosed homes not yet released to the market as a possible negative factor.

What do you think? Please read the original article included in this post:
Double [Dip] or Nothing?

April is Not the Cruelest Month For Real Estate

1 to 4 Plex — Mon, 12 Apr 2010 00:52:44 +0000

Just like it is for the weather, April is something of a transitional month for real estate in Southern California. This seems to be the case this year we are facing the expiration of the federal tax credit of up to $8000 for first time home buyers who enter into contract by April 30. (Now that California has joined the game by throwing in an additional tax credit, for a short while at least, quick acting first time buyers might be able to get up to $18,000 in tax credit.)

The March statistics for the San Fernando Valley seem to indicate that these programs may be increasing sales.

If we look at the charts below, we see a brisk upward trend since January. In January and February, the properties stayed longer on the market, while the sale activity cooled from December 09. However, March 2010 shows an increased activity with sales jumping up, more properties going into escrow and prices that are heading up. Despite the pending lapse in the federal tax credit, it appears likely that this trend will continue for the coming months, especially since interest rates are still comparatively low, prices, though edging upwards are still attractive, and California (and various municipalities) are helping out with various programs providing down payment assistance and other benefits to help buyers to access properties. Please feel free to contact me as I know about a bunch of special buyer assistance programs.

Woodland Hills: Expectations Out of Balance

Florence Foote — Mon, 07 Dec 2009 14:15:33 +0000

Last time I analyzed the MLS data for the North West San Fernando Valley, I noted some encouraging trends: a 1% year-over-year increase in the median sold price, and the fact that the “for sale” prices were within approximately 10% of the “sold prices,” which is considered a healthy equilibrium between buyers and sellers. This basically means that sellers are being realistic, which permits transactions to take place. But, turning to the micro-climate of Woodland Hills, we can see a very different picture. On the chart below, it is apparent that while the “for sale” price hasn’t budged since last year, the median sold price has plunged 11%. In other words, buyers and sellers are getting increasingly out of sync. But, at the same time, inventory has plummeted from earlier this year. It will be interesting to see in the coming months whether the expectation gap causes inventory to increase. Stay tuned.

A Real Estate Thanksgiving!

1 to 4 Plex — Thu, 26 Nov 2009 18:49:43 +0000

Happy Thanksgiving! Prospective home buyers and refinancers alike can be especially thankful this year. According to the L.A. Times, Fannie Mae reports that during the week that ended yesterday (before the Thanksgiving holiday) mortgage rates dropped to a record low (4.78%!!), a level last seen in April, during much gloomier economic times. Not surprisingly, these low rates have already gotten buyers off the sidelines, and inventory levels in some areas (such as the San Fernando Valley) have plummeted over the last year, according to the L.A. Daily News.

All of this bodes well for the market in the near future. If you want a great rate, grab it while it lasts. I have a network of great lenders and would be happy to make an introduction. When the coming wave of inflation hits, you’ll be glad to have locked in affordable long term financing and that you own a leveraged physical asset: real estate. Just remember to insist on a fixed rate, or you could be in for a rude awakening down the road when rates skyrocket.

Signs of Bottoming In The San Fernando Valley?

Florence Foote — Sat, 21 Nov 2009 06:11:58 +0000

DataQuick has reported that Southland home sales are up overall, and the same trend can be seen in the MLS data from the Northwest San Fernando Valley. Indeed sold prices have actually increased by 1% from a year ago. Also, since the gap between the “for sale” price and the “sold” price is now within 10%, which is considered to be a good sign for increasing sales, as the sellers’ expectations have gotten within striking distance of the buyer’s. This chart also appears to reflect some influence from the federal first time homebuyer tax credit and the pressure to close before it expired (although it has now been extended in a slightly different form).

Also check out the lower chart for a dramatic view of the shrinking inventory. This reflects the buyers’ frenzy that snapped up many of the better priced properties during the middle of the year (most of which were distressed.), For whatever reason, much of this inventory has not been replaced with new inventory. The moratorium on foreclosures may have had some impact on this number, as had the “shadow inventory” — properties that the banks have not foreclosed upon, for reasons of their own. Many are expecting more of these properties to be put on the market over the coming year.

BiggerPockets.com

1 to 4 Plex — Tue, 10 Nov 2009 05:48:01 +0000

I was recently chosen to be an official contributor as a Real Estate News columnist on Biggerpockets.com. I have always admired Bigger Pockets for the depth and quality of content, so I was naturally thrilled to be selected to be a contributor. The founder of Bigger Pockets, Josh Dorkin, is an amazing guy and a former Keller Williams® agent.

My first “official” Bigger Pockets post related to Fannie Mae – and their recent underwriting rules, which you can read here. I recently had a deal fall apart. The problem was, at least in part, related to Fannie Mae’s strict new underwriting guidelines which look very closely at the number of delinquencies in an homeowner’s association (i.e., how many owners are not current on their HOA dues.) This once-trivial sounding statistic can be a deal killer, so buyer beware. You can read more about it on my blog at Biggerpockets.com

“DID I OX YOU????”

Florence Foote — Mon, 02 Nov 2009 03:26:10 +0000

I loved this impression of Anton Chigurh foisting off a house on a unsuspecting couple.

Incredible high yield opportunity on a true Duplex, 2 on a lot

Florence Foote — Fri, 30 Oct 2009 06:15:57 +0000

Incredible high yield opportunity on a true Duplex, 2 on a lot. Completely remodeled units ready to rent. ALL seperate meters including water!This property will go fast!

Market rents for the 2/1 is $1250 and the 1/1 rents for $850. GSI $24,600 yr/ $2050 mth.

Low expenses and great income make this an incredible deal, call today to make an offer!