Summer Stats!

Our upgrade to the “LA Area Real Estate” iPhone application should be available in the iTunes App Store any day now. The app is free and we welcome your feedback. This new version includes links to our Facebook and Twitter accounts. We look forward to trading posts and tweets! We will also make an announcement here on our blog when it is available. If you are an iPhone or iPod Touch user and have not downloaded the application, check it out here: http://www.teamgreenrealty.com/iphone_app.htm. On to business…


The First-Time Home Buyer’s Tax Credit specifies that you need to close on a property by December 1st to qualify for the $8,000 credit. If you are planning on taking advantage of this great tax break, you better get moving. The average escrow is 64 days in today’s market. This means that you need to not only find a place, but get it into escrow by October 1st to comfortably make the requirement.

Let’s talk stats:

July and August are traditionally two of our busier months and this year was no exception. Competition is still fierce for buyers, so if you are contemplating a purchase, be prepared to listen to your agent and trust their expertise. Unfortunately we have seen a trail of broken hearts this year as buyers, especially first-timers, enter the market with their own perceptions based on doom and gloom media coverage. They think that they can purchase a mansion for pennies on the dollar. Many of them do not listen to their agent’s advice about our competitive market and end up falling in love and ultimately losing several properties before they “get it.” Houses listed in our area under approximately $800,000 are moving very quickly. There are still plenty of “all cash” and “half cash” buyers in almost every corner of our local market and they have been driving up prices through bidding wars and strong offers for several months now and there is no end in sight. This is a fantastic time to buy as long as you have a great agent who can guide you through the deal and help you strategize. There are plenty of really great deals out there so let your agent and your research guide you.

For our sellers you can expect reasonably fast sales as long as your agent does their homework and helps you price your home competitively. There is plenty of competition so pricing is everything. You should expect a fair amount of activity and you will need an experienced agent to help you determine which offer is the strongest. Remember that the strongest offer is not always the one with the highest price. There are many other factors at play as well. Find a great agent and trust their advice. If you don’t already have one, give us a call. We’ll be happy to serve you.

Overall houses in the Los Angeles area sold faster in August than any other month this year except for June. Our average days on market (how long it took to sell) was 64! That’s a great number. In the Northeast San Fernando Valley the average DOM was only 50 days…wow! That’s some of the best news we’ve had all year.

On the flip side of that, our numbers for August show a general slowing after steady improvement all year. The decrease in overall prices in our area, combined with the increasing accessibility of credit has kept the market very active all year. It is difficult to say exactly how much of the increase in sales during the summer months was just seasonal activity or if we can expect a steady volume of sales into next year. Hopefully the soon-to-expire first time buyer tax credit will keep the summer momentum up.

Totals-Greater Los Angeles Area

Individual Locales

As you can see, this is a great time to buy or sell real estate. Let us know if we can be of service to you.

If you are considering selling, visit our free offers page by clicking here to get a free evaluation of your home. Buying or selling, if you are ready to make a move call us at 818.LVTMGRN (818.588.6476) or click here to contact us. We look forward to hearing from you.

Still not sold on us? See what our clients are saying about us by clicking here.

How the New Stimulus Plan Affects You

For those of you on the mailing list, we hope that you enjoyed the Valentine’s edition of our newsletter.  For everyone else, we hope that your Valentine’s Day was wonderful and as full of love as ours was.

We have received several phone calls and emails regarding President Obama’s new stimulus plan and how it affects homeowners. While some details may change in the near future, here are the facts as they stand today. 

Earlier today, President Obama unveiled the Homeowner Affordability and Stability Plan, which will offer assistance to as many as 9 million homeowners, while attempting to prevent the destructive impact of foreclosures on families and communities.  The plan contains three main components, and only applies to primary residences. The loans referenced in the plan cannot exceed Freddie Mac/Fannie Mae conforming loan limits.  I have outlined the plan in greater detail below.

The first component is directed toward homeowners suffering from falling housing prices who still have equity in their homes, but no longer have the 20 percent equity needed to refinance.  Under the plan, homeowners who have conforming loans owned or guaranteed by Freddie Mac and Fannie Mae will be allowed to refinance their homes, even if they do not have 20 percent equity left in the house. The U.S. Treasury Dept. estimates that about 5 million homeowners will be helped by this portion of the program.

The second component, known as the Homeowner Stability Initiative, is designed to assist homeowners who are “underwater” on their mortgages. The $75 billion initiative will bring together lenders, servicers, and the government so that all stakeholders share in the cost of the modification.  Primary mortgages would be reduced to monthly payments that do not exceed a 38 percent debt-to-income ratio, with the costs of doing so borne by the lender. The government and lender then would split the costs of further reducing the monthly payments until they were at a 31 percent debt-to income ratio. An important aspect of the initiative is that homeowners do not have to be delinquent to participate.

The Homeowner Stability Initiative also will create incentives for servicers, mortgage holders, and homeowners. Servicers would receive an up-front fee of $1,000 for every eligible modification meeting the initiative’s guidelines. Guidelines are scheduled to be released by March 4. Mortgage holders will receive an incentive payment of $1,500, and servicers $500, for modifications made on loans that are current but at risk of imminent default.

The final aspect of the Homeowner Stability Initiative is creating clear and consistent guidelines for loan modifications. The Obama Administration plans to work with federal agencies, banking and credit union regulators, and the private sector in order to develop loan modification guidelines that can be implemented across the entire mortgage market. While adoption of the guidelines will be voluntary for the private sector, all financial institutions receiving Financial Stability Plan assistance going forward will be required to implement the loan modification guidelines.

The government estimates that between 3 and 4 million homeowners will benefit from the Homeowner Stability Initiative component of the plan.

The third component of The Homeowner Affordability and Stability Plan is supporting low mortgage rates by strengthening Fannie Mae and Freddie Mac.  The Treasury Dept. plans to increase their Preferred Stock Purchase Agreements with both Fannie Mae and Freddie Mac from its current $100 billion in both entities to $200 billion in each. The Treasury Dept. also will continue to purchase Fannie Mae and Freddie Mac mortgage-back securities in order to help promote stability and liquidity in the marketplace.  Additionally, the Treasury Dept. will increase Fannie Mae and Freddie Mac’s portfolios by $50 billion, for a total of $900 billion. The Obama Administration will work with Fannie Mae and Freddie Mac to support state housing finance agencies in serving home buyers, such as CalHFA. Funding for this will not come from TARP money but from the Housing and Economic Recovery Act.

While some of the details still are being developed, such as the modification guidelines, the Obama Administration plans on using programs and funding already allocated for The Homeowner Affordability and Stability Plan and will need little legislative approval for programs under the plan.

We’ll keep you updated on the Homeowner Affordability and Stability Plan as more details and information become available to us.

Buying or selling, if you are ready to make a move, call us at 818.568.8402, or click here to contact us.  We look forward to hearing from you.

Still not sold on us? See what our clients are saying about us by clicking here.