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Coldwell Banker Previews International
Coldwell Banker  Residential Brokerage
Beverly Hills, CA 90210
by Cynthia S. Radom Award-winning Certified Seniors Specialist REALTOR
                                                          Since 1994
         January-March 2015   �   [email protected]   �   (310) 288-0479  CalBRE #01184864

                                     ** Writer and Publisher since October 1999 **

Changes to Purchase Contract
Revised RPA

As of November 24, 2014, Buyers of CA real estate have been using a newly revised Residential Purchase Agreement (RPA), unchanged since April 2010.  The multi-page RPA is submitted by a prospect when offering to buy a single-family home or a one-unit income property.  A different Agreement is now used for purchases of two-to four-unit structures as part of the RPA changes. 


Here are some important highlights of the RPA's 80+ revisions:

- Pest Control: Termite repair issues continue to be a negotiable item between Buyer and Seller.  However, now it is the Buyer who will obtain a pest investigation report as part of their due diligence during the inspection period.  A unified approach to inspections and repairs is being taken.  The termite exam is no different than a Buyer getting a myriad of other inspections and hiring specific trades to review roof-to-sewer line and everything in between.
- Trust Sales: When a property owner places their asset in a Trust and subsequently passes away, it is the Trust that is selling the estate, not the Trustee.  The new RPA requires any party involved in a transaction who is representing a Trust (or a LLC, or a corporate- owned property) to provide written proof of their ability to sign on behalf of the entity within three days of an accepted offer.

- Assignment: No more total or partial assignment of the property purchase to any other party without the written consent of the Seller.  Furthermore, the new RPA declares that any assignment shall not relieve the original Buyer of any obligation.

- Lender Approval: The Buyer's lender must approve any/all credits (e.g. for repairs) given to the borrower and, if applicable, a leaseback Agreement should the Seller remain in the home past the closing.  Lenders want to know everything about the Buyer.         

- Inclusions and Liens: The Seller must disclose specific items (e.g. security systems or solar panels) that are leased, not owned, by the Seller which may cause a lien against the property.  


In addition to verbiage changes, there are several new forms that were created to clarify various issues or situations.  As a Buyer and Seller of CA real estate, expect to sign and/or initial about forty forms, many with multiple pages.  Your agent will help you to understand the information you are signing.   

Important Update
Riverside is now one of nine reciprocal counties where you can transfer your low property tax when buying a replacement home under Proposition 90.  Should you decide to make the CA desert your primary residence, you can keep your current tax as long as you qualify for the Senior Citizen's Replacement Dwelling BenefitAlways verify eligibility with local Assessor to ensure transferability.  Call me for info.

  Rent or Buy Next Time
Excerpts from AARP Bulletin 
Home ownership is solidly entrenched among retirees.  During the recession ownership for those 65+ remained steady at about 80%.
It's all about income 
How does one decide to buy or rent after selling the family home?
- Views change for Seniors as a home for investment purposes is less important.
- Selling for the equity, to keep a certain lifestyle, is more important than kids inheriting the home.
- Estimate your retirement budget with and without buying a replacement home.  How will you pay for housing expenses?
- Rents increase about 3-5% per year, but so will insurance and upkeep for home ownership.
- Generally, renting is cheaper than buying and owning a home.
NOTE: With Prop 60 and the ability to pay all cash, buying a condo or smaller home is doable in CA if you have enough cash to live on.  Financial planning is the key.

Renting Rewards 
- safety net to experience a new area if moving out-of-town
- easier to travel without worrying about the home (condos are best for travelers)
- landlord handles maintenance
- no sudden expenses for upkeep or replacement items
- offers new and updated home features that you did not endure the cost or construction

Pointers When Renting
- Avoid renting someone else's property as they may decide to sell and force you to move out.
- Inquire if pets are allowed, and what the limitations include.
- Adjust attitude that renting is "money being thrown down a rat hole".  Contrarily, renting frees up cash to keep you living well.  Besides, insurance, upkeep and most of real estate taxes go down the rat hole, too
Consider what is best for you!  

Practicing what I personal moving experience.   


I recently moved after living in the same residence for 20 years.  After finding a place to call "my new home" (a must first step), I was ready to begin the moving process.   


Tucked away in my current home were unopened boxes from when I moved to L.A. from Chicago, two decades ago!  Also, boxes filled with fine china, crystal and silver serving pieces I had not used, maybe ever!!  Obviously, I had over-looked these boxes during my annual de-clutter sweeps!!  


Now for a few tips that may be helpful when you get ready to move:
- Bare bones: Move only what you need and use; go bare bones.  Toss, donate, sell or give to family the things you absolutely do not use.  Example: take and upload photos onto your computer of things that you cherish, then discard the actual item(s); de-clutter.
- Budget to pack and unpack: Plan to have the movers do all the labor; your job is to organize.
- Moving journal: Keep every note and thought that is move- related in one notebook and on one calendar.
- Hire a great mover: I hired Delancey Street Movers before I learned about their Foundation and how it helps staff to a better road-of-life.  All the Delancey movers were very professional from start to finish; courteous and hard-working caretakers who were glad to be working.  Plus, I felt good about helping those who helped me.  Click here to read more about Delancey Street... highly recommended for moving.  

- Treat yourself: Buy a new replacement of an old or worn out something for your new home.
- Get plenty of rest: Take cat naps if needed, as your mind continues to think of things to do.
- Pets: Give extra TLC as they don't understand, but feel the confusion around them.
- Look forward, not backward: Get excited about your new home and why it will be better for you than the home you are leaving.
- Laugh: Take time to look at old photos and listen to some music while uploading albums onto your computer.  Feel the lightness of scaling down to bare necessities house.
People are often afraid of change.  Moving is invigorating and cleansing.  Change is good.

2015 CA Housing Forecast
The CA Association of REALTORS(C.A.R.) has released its 2015 CA housing forecast.  Keep in mind that this information is Statewide and that County projections can, and do, vary.  Projections for end-of-year 2014 vs. 2013 are: Prices to increase 11.8% (projection was 6%) and number of closed sales is expected to be down -8.2% (projection was up +3.2%).  The decrease in 2014 home sales is due to rising prices and fewer speculators snapping up properties to build or flip after renovating.  Association economists predict that with more available homes on the market for sale in 2015, CA's housing market will see even fewer investors and a return to traditional home Buyers as the number of home sales is expected to rise modestly and prices flatten in 2015.

In 2015, the C.A.R. forecast sees an increase in existing home sales of 5.8% to reach 402,500 units, up from the projected 2014 sales figure of 380,500 homes sold in CA.  The average for a 30-year fixed mortgage interest rate is expected to rise only slightly to 4.5%, but will still remain at historically low levels.  The CA median home price is forecast to increase 5.2% to $478,700 this year.  This is the slowest rate of price appreciation in four years.

THE REAL NEWS: Mark Schniepp of CA Economic Forecast stated that the L.A. County median home price increased 24.85% in 2013 vs. 2012 and projects increases of 15.53% in 2014; 7.48% in 2015 and 1.93% in 2016.
Residence Corner

Fake it or not?

- LADWP is paying homeowners to replace real grass with artificial turf in light of the water crisis: Cash for Grass info.  But, not Bev Hills as that City wants a longtime Senior resident to remove the turf.  What do you think of fake grass? Click here to e-mail me your confidential thoughts 

Note: Glendora Country Club to receive a $2.2M rebate for replacing 25 acres of grass (avg. golf course uses 312K gallons of water per day).     

- Highest priced U.S. listing, Palazzo di Amore, a 25-acre Beverly Hills compound asking $195M, features 12 bedrooms, 23 baths, a vineyard, 27-car garage and so much more.  Listed with Coldwell Banker BH-South office.  Click here for 13 photos

- Historically significant property, click here and read about it 

          Tidbits of News

- For those who are moving, register and receive all sorts of saving offers.
- 70% of home Sellers only contacted one agent to hire for the sale, per a new survey.
- Mortgages: No! It is not going to get easier to obtain financing.
- Prop 13: Voters may have a chance to decide the fate of Prop 13 in the 2016 election.

- CA estate sales: As of 3Q 2014 sales rose significantly over 2013:

- $5M up 23%
- $10M up 25%
- $20M up 46%
- $30M up 55%    

Condo Sellers: New RPA requires up-front payment to order HOA documents, no longer payable through escrow

International Buyers

Year-over-year there was a 35% increase in U.S. home purchases by foreign Buyers.  In 2014, an estimated $92.2 billion was spent vs. $68.2 billion for the same period a year ago.  This amounts to about 7% of the total U.S. home sales.


Foreign Client Facts:  

- Typical purchase price is 68% higher priced than U.S. citizens pay.

- Bolstered activity is due to rising affluence in China, Canada, India, Mexico and the United Kingdom.

- Reasons to purchase: relocating for jobs, children attending U.S. college, a vacation home or investment and portfolio diversification.

- Reasons not to purchase: cost, taxes and insurance accounted for 30%; financing 19% and immigration issues 9%.  

- Purchase criteria includes proximity to the home country, the presence of relatives, friends and associates, job and education opportunities.  Climate and location also appear to be important considerations to foreign buyers.        

- Europeans are attracted to states with warmer climates such as Florida and Arizona.  The West Coast is attractive to Asian purchasers.  Buyers from Mexico favor states in close proximity, such as Texas and Arizona. Florida attracts South Americans as well as Europeans and Canadians.

- Canada was the top source of international clients in terms of transaction volume, but China accounted for the largest sales dollar volume because of their higher average purchase price.   

- Top five states: Florida, California, Arizona, Texas and New York accounted for 55% of the total reported purchases by international Buyers in the U.S. 


  No Hiding Purchase Price
Buyers can no longer try to hide the property sale price from the public as transfer taxes are now required on all recorded documentation.  An inquiring mind only needs to divide the property tax by 1.25% to learn the purchase price of a private sale. 
Title and Escrow Functions
Two important service providers during a property transaction are the "Escrow" and "Title" companies.  In a traditional real estate transaction, whether it is a sale or a refinanced property, the Escrow company becomes the repository for all documents, agreements and funds.  Escrow also directs the transaction pursuant to instructions from the parties to the deal: Buyer, Seller, Lender, etc.

The Title company advises Escrow as to what items it needs or what steps might be taken to remove any objectionable items found in the title search.  When all matters are cleared from the Title Report, and all other contingen- cies in the transaction have been met, Escrow then contacts the Lender to request funding  (money to cover the loan amount).   

Funds are normally sent
to the Title company's bank via wire transfer.  This is the time when Escrow authorizes (sets-up) recording with the Title company. Next, Title confirms receipt of all documents, fund and statements of information and transmits the docs to the County Recorder for recording.  Simultaneously, Title forwards to the Title company's sub-escrow department all demands, title fees and taxes that are due.  When recording is confirmed, Title pays off the demands and taxes and collects the title fees from the proceeds, forwarding the remainder to Escrow.  Transaction is complete.
Information provided by Equity Title Co.

Mark Your Calendar 
Watermark of Beverly Hills, an upscale assisted-living residence, is hosting a "Downsizing" seminar featuring yours truly.  Join me and Greg Gunderson of Gentle Transitions on Wednesday February 4th and learn how to make moving easy. 

Refreshments, in celebration of Valentine's Day, will be served. 

Call me to register for this must-attend event: (310) 288-0479.  Bring a friend or family member too.  It's free!
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