Breaking News! FHFA changes will cost home Buyers more in 2014 with increased mortgage rates and fees.

Real Estate e-Newsletter

Coldwell Banker Co.
166 N. Canon Drive
Beverly Hills, CA 90210

by Cynthia S. Radom Award-winning Certified Seniors Specialist REALTORŽ
Since 1994

NEWS & ISSUES for BABY BOOMERS to GOLDEN-AGERS

January-March 2014 ˇ Cynthia@RealtorRadom.com ˇ (310) 288-0479 CalBRE #01184864

** Writer and Publisher since October 1999 **

We're Having a Contest

2013 Rebound

No one predicted, including national or state economists, real estate brokerage CEOs or other market analysts, that in 2013 SoCal home prices would rebound about 70% from the October 2008 financial crisis. Then again, no one predicted the financial crisis where home values plummeted 30-50% nationally causing a Buyer's market for the next four+ years, low selling prices and negative home equity. But, a full recovery from the unrealistic 2007 market high has not been realized as prices are still down about 30%. However, thanks to 2013, most property owners' equity is now in the black.

The rebound started in October 2012 when a totally different real estate market began. The sky opened and the sun was shining once again on the local housing market. Buyers started snapping up properties with historically low mortgage rates as bottomed-out asking prices began heading up the bell curve. Any homeowner who was able, willing and priced to sell realized quick closings, turning the real estate market into a Seller's delight.

More about the 2013 recovery
- developers and investors were at the buying forefront early on
- almost 30% of all property sales were all-cash deals
- multiple offers were the norm, but prices were not always over the asking price
- developers quickly remodeled properties and flipped homes for a substantial profit, helping to raise market values
- homeowners were staying put, as equity remained an issue, causing an inventory shortage
- mortgage rates inched up as inventory remained low in 2013 - a plethora of foreclosed homes were purchased with relatively few remaining
- "Generation X" Buyers (33-47 years of age) were gaining momentum as speculators pulled back from rising prices
The buying frenzy of 2013 slowed down at summer's end, but prices are still markedly improved over 2012. What will 2014 bring?

Let's have a contest
Submit your prediction to me for a chance to win a $100 restaurant gift certificate of your choice.

Answer this question:

- According to the MLS totals, how many total single-family home sales will close escrow between 1/1/2014 - 6/30/2014 in Beverly Hills, BHPO, Bel-Air, Brentwood, Westwood, Santa Monica, Cheviot-Rancho Park and Pacific Palisades?
Hint: Total sales for the first half of 2013 in these eight areas was 770.

E-mail or write your contest entry to me by January 31, 2014.

CA Ranks the Worst
California is ranked the worst-run U.S. state by 24/7 Wall St. for the third straight year.

Happy 100 Beverly Hills

Picture all of the luxury car brands you see today on Rodeo Drive and replace them with black Model Ts and all the site seers with horseback riders. Then, remove all the world's most exclusive stores. That was the vision along Rodeo Dr. on January 28, 1914 when Beverly Hills was incorporated as a town. Celebrate the Beverly Hills Centennial and join in the year-long festivities for what is now the most well-known zip code in the world...90210.

Beverly Hills was named in 1907 after Beverly Farms MA where then President Taft vacationed in the east. The land was originally part of a 4,539-acre ranch owned by the Valdez family, but later sold many times before the turn of the 20th century. Open fields were planted with vegetables and Santa Monica Blvd. once housed farm worker shacks while farm owners lived in hillside ranches.

In the early 1900's, an investment group bought ranch acreage and began sub-dividing into lots. Low Buyer interest ensued until Hollywood Hotel owner, Margaret Anderson, built the posh Beverly Hills Hotel. Opening in 1912, the hotel appealed to celebrities and industry leaders offering an electric trolley stop, riding stables, school classes for children of snow-birds and fox hunts in the back grounds. Prior to WWII, in the area near what is now Sunset Blvd., a "bridle path to the sea" was developed. Will Rogers, Max Whittier and Burton Green backed the road project drawing locals and visitors alike. The path eventually closed as cars and horses caused havoc together on the same road.

The Beverly Hills Centennial hoopla began last October, but there is still time to partake throughout the year. Click here to read the: Centennial Events Calendar

Improvement Loans
While homeowners are watching their equity levels rise, their hopes of financing a remodeling project remains difficult. Today's lending environment still includes institutions that are gun shy about investing in new products and providing home equity lines of credit.

According to Compass Point, property owners' equity increased $571 billion in the second quarter of 2013, and $2.2 trillion over the past year. The time is ripe for people to make improvements on their homes. However, banks continue to face compliance issues and regulatory uncertainty, and taking a risk on new products that have no history of positive results remains the issue. Let's see if 2014 brings somewhat of an ease in lending practices.

Now! Today! Wintertime in CA is a great time to sell a home; a lot of qualified buyers and less competition.

C.A.R. Recap & Predictions

According to the chief economist at the CA Assoc. of Realtors (C.A.R.), the number of single-family home sales will rise 3.2% in 2014, after falling 2.1% in 2013, amid tight inventory that helped to drive prices rapidly higher. More homeowners are expected to sell, now that their home is worth more than their mortgage, easing rapid price gains in 2014.

Why inventory was low in 2013
- few newly constructed homes in the last five years
- underwater homeowners were stuck with negative equity
- foreclosure pipeline was drying
- investors were renting instead of flipping (purchased low and held)
- off-market (pocket listings) are growing

Sale prices skyrocketed
The median home price for 2013 was about 28% higher than in 2012, and C.A.R. forecasts a normal increase of 6% in 2014. Another prediction affecting L.A. real estate is an increase in the 30-year fixed mortgage rate to 5.3% by the end of the year, currently about 4.3% - still historically low.

A look at the 2013 Buyer
- number of sales with multiple offers was the highest in 15 years
- 72% of sales in 2013 had multiple offers
- 82% of investors are renting the purchased property instead of flipping
- cash buyers decreased for the first time since 2006; seven years of continuous increases
- more Buyers with 20% down payment on mostly fixed-rate mortgages (vs. adjustable)
- first-time Buyers were the lowest since 2006 (27% of total sales)
- international Buyers are on the increase (8%) with 36% all cash
- top citizenship of foreign Buyers were from China, Canada, India and Mexico

SoCal Regional Report Card
- prices gained 70% from the trough
- inventory, to long-run average, was down 54%
- 61% of Buyers found a home through a REALTORŽ
- 91% of Buyers used an agent for their transaction

What does your crystal ball indicate? See the headline contest article and submit your sales prediction for the first half of 2014. You may win a $100 gift certificate to your favorite restaurant.

Luxury Market Report

Coldwell Banker's latest Luxury Market Report indicates only one non-coastal real estate market, Aspen CO, makes the top 20 luxury estate sales list in 2013. Also, the top most expensive U.S. markets to live in are: Malibu, Newport Beach, Saratoga, Los Gatos and San Fran--all in CA.

Specializing in Longtime Homeowners

This year marks my twentieth anniversary as a California REALTORŽ having just moved from Chicago in time for the '94 Northridge big event. Without the luxury of an established group of people to target in the real estate business (aka sphere of influence), I identified an untapped need: helping longtime homeowners overcome the challenges of moving from their beloved family residence. My focus, as a new REALTORŽ and primarily as a listing agent, became a demographic market (instead of a specific geographic focus) currently working in areas from Los Feliz to Malibu and in the near San Fernando Valley.

Twenty years later, I continue to have the enjoyment of a successful business as a Certified Seniors Real Estate Specialist. Here are some highlights of my career...so far:

- Starting the Real Estate Newsletter (in 1999)...according to the feedback, enjoyed by many

- Continuing to overcome the challenges homeowners have when moving: emotionally, physically and psychologically

- Helping Sellers obtain an honest and advantageous deal in the country's most competitive housing market

- Offering the same professional services to heirs and trustees

- Foremost, as a full-service agent going above and beyond the responsibilities of a REALTORŽ where my clients don't have to lift a finger, except to sign documents

Many thanks to my clients during the past 20 years, and to all those who refer me as a qualified and trusted real estate agent. And...thanks, in advance, to my future clients.

Residence Corner

The practice of feng shui is often applied to home buying among Asian Buyers. Numerology practices are also applied to the street address and the listing price of a property. How your home may or may not appeal to a Chinese buyer is interesting, as sales continue to increase by this foreign group of purchasers.

Numbers have significant Asian meaning either as a single digit or a combination, or added together and divided by two to generate a single digit. Meanings associated with numbers include:
1- unity 2- easy 3- liveliness
4- death 5- nothing 6- profitable 7- certainty 8- prosperous
9- longevity, enough
You may have the most wonderful home for sale, but if your address contains the number four, or any derivative, your Buyer most likely will not be Asian. In Mandarin, Cantonese and several other Chinese dialects the number four is pronounced similar to their word for "death" and gives cause to the meaning of tetraphobia. But, the number eight is pronounced like a word meaning "prosperity" and is very appealing. Change can occur when another number is added, for example: 54 (not dying, living forever) or 58 (without prosperity). Other people fear the number 13 (triskaidekaphobia) or revere a number as in the lucky number seven. What says your address?

Tidbits of News

- BHPO estate, zoned for horses and equipped with stables on 10.2 acres, is listed for $34.5M: Click here for details
- New B.H. condo project is under construction at 313 Reeves Dr., four-stories with ten units
- Spec home on Laurel Way in BHPO is fully-furnished, not in the MLS, asking price is $36M. Click for photo gallery

B-A Mega Mansion

- Bel-Air will be home to LA's largest mega-mansion, Chateau Des Fleurs a sprawling 60,000 sq. ft., when completed. Construction started in 2008.

Emotional Seller Errors

Emotion-driven mistakes by Sellers can be avoided when cashing out your most valuable asset. Here are some important errors to recognize prior to listing your home for sale, and a fix:
1. Price reduction paralysis
When it comes to pricing, many Sellers begin overconfident in today's market. As the days on market (DOM) turn into weeks or months, panic begins fearing low-ball offers, no offers at all or being stuck in the home and future plans ruined. Along with panic comes fear and paralysis with an inability to reduce the price. Fix: Set a date for a price adjustment in the listing contract.
2. Excessive attachment
A home is filled with memories and uniqueness to the owner. Buyers don't know your emotional value to the home, nor do they care, and they have no interest or intention to pay for it. When a home is listed for sale the Seller needs to view their "castle" as a commodity. Fix: Realize your home as an asset that will sell in a business transaction.
3. Celebrating too soon
Multiple offers and over-asking prices in today's market may lead to a false sense of complacency even before an offer has been received. And, too often deals can fall out of escrow. Fix: Stay vigilant through the close of escrow.
4. Price confusion
Placing an asking price for the home based on Seller needs or wants instead of a "fair market value" range is a mistake. Overpricing actually endangers the vision of moving forward with one's life. Fix: Study DOM, price reductions and asking-to-sale- price ratios of comps in your area to determine the listing price.

Free Specialty Phones
Free phones are available to CA residents who have trouble: hearing, speaking, remembering, seeing or moving. There are no income requirements and no hidden fees. Call for more information: (800) 330-5100.

Yes or No?

Are you a good negotiator?
Do you feel confident negotiating?
Do you know what it takes to win
a dispute?

If you say no! to any of these questions, don't even think about representing yourself in a "for sale by owner" deal. Hire a REALTORŽ, a professional negotiator to win in your behalf.

New Mortgage Rules

Almost six years after the 2008 housing and financial crash, resulting from poor mortgage lending practices, come new rules for lenders effective January, 2014. Pre-crash, home loans were given to people who could not afford them, thereby forcing the industry to be regulated.

Lenders must now ensure that borrowers have the ability to repay their mortgage. Also, those who service home loans have rules that protect borrowers from risky lending practices, which led to many foreclosures. Here are the new mortgage servicing rules:
- written monthly mortgage statement itemizing past, present and future transaction activity
- two months forewarning if adjustable mortgage rates will increase monthly payment
- full payments must be credited to the account on the day received by lender
- seven days to respond to a borrowers inquiry for mortgage pay-off amount
- 45-day notice that a lender will obtain home insurance for a borrower whose protection has lapsed (force-place protection)
- 30 to 45 days to fix a written error complaint from a borrower
- set-up lending businesses to follow good customer practices and policies
- 45 days after a delinquent payment to offer workout options
- fixed schedule to follow prior to foreclosing
- third-party review option of a foreclosure decision

Sixty percent of the credit unions polled by their Association replied that computer programs will not be ready to implement the rules by the January deadline, and they will therefore delay, discontinue or reduce mortgage offerings.

NOTE: Bank of America was found liable for Countrywide's "Hustle" lending program and faces $850 Million in fines and $40 Billion in court costs. BofA plans to appeal stating the mortgage program ended prior to its purchase of Countrywide.

Leading U.S. Recovery Realtor.com, a real estate search engine, revealed the ten areas that are leading the nation's housing recovery are: six CA areas (Oakland, Orange Cty., Santa Barbara, San Jose, Los Angeles and San Diego), Detroit MI, Seattle WA, Portland OR and Reno NV.

If you prefer the "Real Estate Newsletter" mailed to you, please e-mail: Cynthia@RealtorRadom.com

Respecting your privacy and confidentiality, names and e-mails will only be used for providing pertinent material by Cynthia S. Radom and will not be shared with any other organization.

Š2013 Coldwell Banker Real Estate LLC. Coldwell BankerŽ is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Equal Housing Opportunity. Owned By a Subsidiary of NRT LLC. This is not intended as a solicitation if your property is already listed.