Home Buying Tips

Grand Opening Open House Saturday March 14, 12-4pm; Lunch at Noon — 25271 Tanoak LN, Lake Forest

Tanoak Living RoomDUAL MASTER SUITES (perfect for roommates) GREAT FIRST HOME OR INVESTMENT PROPERTY.

Welcome to the picturesque lakes, woods and hills of Lake Forest. This attractive and quiet 2-bedroom, 2-bath, Dual Master Suite, end-unit condo is in the desirable community of Tierra Vista. PRIVATE staircase leads from your attached 1-car garage (with driveway) to upper single-level living.

Fresh two-tone decorator paint, brand new light fixtures and window coverings. Walk-in closet in one master and a wall of closets in the other. Bright kitchen with lots of cabinets and newer appliances, Full-size laundry room with French doors, skylight and storage. Living room AND both bedrooms have French door/sliding door access to veranda – perfect for grilling or entertaining. Each bedroom has its own linen closet.

Tanoak FrontPool and spa are just steps away. Situated off of Peachwood next to exquisite Serrano Park homes with walking trails, greenbelts and parks all around. Only a few miles from the Irvine Spectrum businesses & dining venues! A short stroll to shopping, dining and eateries. This condo looks like a model and is deal-priced to blow out this weekend.

Full Property Profile

This home is coming on the market at $364,900.  It won’t surprise me if it sells for more so to have you best chance at winning the keys to this great property, please talk to lender, Tom Testerman at 949 422-4497 prior to the open house and then be first in line to view it and have a few bites to eat on Saturday.  Any questions, call me at 949 583-1331 and leave a message.  I will return your call at my earliest convenience.

22252 Anthony Drive, Lake Forest: GRAND OPENING OPEN HOUSE Pizza Party May 18th, 12-5pm

Anthony Front PS reducedhttp://www.youtube.com/embed/EMTE0k6so-4

SEE ALL THE PHOTOS by clicking link above.

Exquisitely-upgraded Sun & Sail Club, Parkwood Estates 4-bed, 3-bath, 3-car garage, 600 SF bonus room culdesac home shows like a model!   Huge upper master with 2-person Jazuzzi tub & travertine 4’x6’ double shower AND Downstairs Master/in-law ‘wing’ with travertine fireplace, ¾ bath & multi-purpose craft/ food storage/exercise/sewing room.  Upgrades include travertine flooring, patterned Berber carpeting, raised-panel doors, recessed lighting, 2” white slat blinds, & cat-5 outlets. Spacious kitchen/great room has walk-in pantry, expansive center island with double O.G. Granite counter tops & pull-out trash bins/recycle center, pull-out drawers, double deep & wide sink with ‘touch 20’ pull-out faucet & stainless steel appliances including Bosch dishwasher & G.E. Monogram 5-burner induction cook top.  All bedrooms have walk-in closets. Baths have granite counters, new cabinets, tubs, toilets & mirrors.

Brighter Sun  Sail from jacuzzi to fountain and Sailboat reducedYour family will love what nature offers you surrounding this cul-de-sac home.   Grassy front, side & back yard with patio, landscaped slope & mini orchard! Short stroll to woodsy walking trails or the fabulous Sun & Sail Club & it’s lovely lake, 4 pools, spa, saunas, tennis, volleyball, state of the art fitness center, youth center, snack bar, lounge,  & more.  You can even launch your own kayak for a sunset cruise. 

The home will be priced in the $750,000-775,000 range. Call me at 949-583-1331 ASAP if you have been waiting for this lifestyle to become a reality.

Anthony Living room PS reduced

NOT selling more Homes, BUT Selling Homes for MORE! 

This business model has made my sellers successful for over a dozen years.  While other agents may be listing 4 homes a month, I generally accept one listing and spend 4 times as long preparing and marketing it to sell for MORE… and to sell faster!  That is why you don’t see my open house signs around town week after week.  Highly marketing one seller’s home at a time with hands-on service…

…Come see the difference it makes.

Anthony grass and slope after

Anthony living room close up toward window after Anthony kitchen toward sink after

34152 Selva Road #176, Dana Point, CA 92629

Selma ocean view outside pool areaBeach House Paradise – Exquisitely-upgraded 2-bedroom, 2-bath Dual Master suites “Beach House Paradise” in the pristine Niguel Beach Terrace community –  across the street from the Ocean/Strand Beach.  The seller spared no expense in remodeling this home to show like a model home!  Upgrades include Travertine flooring, patterned Berber carpeting, brown/gold Lapidus granite double O.G. kitchen counter tops, custom wood cabinets & stainless steel Jenn-air appliances.  Baths have custom cabinets, onyx counters, whirlpool tubs w/ ¾” glass enclosures & oil rubbed bronze fixtures. Both masters open to their own slate-tiled patio w/ sparkling fountains & beautiful flowers.  The kitchen & living room also have patio access creating an ideal environment for entertaining.  This lower-level, end-unit is in the top/back of the community right off the manicured beach access walkway & has Hawaii-like front yard views of a beautiful, lush greenbelt w/ tropical plantings.  This is THE moSelva view from front door IIst private, serene & beautiful setting in the community.  HOA has clubhouse, beautiful pool area w/ sparkling spa & ocean views. Dues cover hot & cold water & trash. Low taxes. No mello roos. This is the home and lifestyle you’ve been longing for and Orange County Beach Resort Living at its Best!  Will be priced from $525,000+

The Grand Opening Open House is scheduled for Saturday, April 27th from 12-5pm.  Come for lunch at noon and bring your check book as it will sell this day.   Better yet, drive by this unit NOW, walk around the lush grounds, check out the serenity and the garden view from the front porch and phone me to get your loan approval ready.  This will give you the best chance of winning the keys to this amazing home.

Selva Living Room proSelva Master 2 bath proSelva Master 2 pro

Grand Opening Open House- Sat., March 23, 12-5pm …………………Outback Steakhouse Luncheon at noon

$599,900-$625,000. Expansive 5-BED, 3-BATH home w/ Dual Master Suites is a part of Lake Forest’s highly desirable Beach & Tennis Club (down the street off Ridge Route). Located on a private culdesac street, this home is surrounded by greenbelts & has a rural, country feel. Upper master suite has large living/office/ sun room while Lower master has living area/retreat & adjacent bathroom – perfect for extended family living. Stained glass double door entry has hardwood flooring & step-down living room w/ soaring wood cathedral ceilings, fireplace & plush carpeting. Recent upgrades include newer roof, skylights, HVAC system, scraped ceilings, paint, baseboards, TV/Ethernet outlets. Kitchen, family room & lower master suite open to private backyard with newer covered patio & fire pit. Low taxes & no mello roos.

Beach & Tennis Club membership includes 2 swimming pools, swimming lagoon, wading pool, indoor spa, lighted 6 tennis courts, tennis pro, outdoor volleyball & basketball courts, fitness center (with Star Track Pro recumbent and Treadmills & elliptical machines), a billiards room and lake view lounge with bar and large screen TV. They also offer a preschool program on-site. This community is also surrounded by forests where you’ll find seasonal creeks & shady walking trails. Seller bought another. . If you do NOT have a Realtor you have committed to and want the best chance of getting your offer accepted, call lender, Tom Testerman at (949) 422-4497 on Friday to start working on your preapproval… then bring your financial paperwork to the open house to meet him in person. An offer will be accepted from one buyer who visits the open house on Saturday. Will it be you?

To see the amazing floor plan, click here: JeronimoFloorPlan003

Video Tour: http://www.youtube.com/watch?v=xi_7X1s1gdc

 

With very few homes for sale, the market is EXTREMELY challenging

Everybody is frustrated.  Buyers write offer after offer after multiple instances where they did not have the “winning bid.”  Many wonder if they will ever be able to secure a home.  Frustrating. REALTORS® representing buyers have to work ten times harder than a normal, balanced market, showing every home that appears on the market, analyzing the data and writing offers that are one of 20 submitted.  Frustrating. REALTORS representing sel- lers have to keep their clients from getting too far ahead of themselves and grossly overpricing their homes.  Frustrating.

What is going on?  Quite simply demand, the number of homes placed into escrow in the past month, is about equal to the number of homes on the market. The chart below illustrates the issue.  When supply, the housing inventory, is much larger than demand, it takes a lot longer to sell a home.  As they get further apart, it becomes much easier to purchase.  Take a look back in mid-2007 when there were close to 18,000 homes on the market with demand at about 1,200 homes.  Buyers had their choice of homes and it there was no competition.  Last year at this time, the active inventory sat at 7,597 homes and demand was at 3,569.  The lines were much closer, but the difference was still 4,028 homes.  Today, the active listing inventory sits at 3,272 homes and demand is at 2,887, that is a difference of only 385 homes. The last time this occurred in Orange County dates back to 2005.

Demand is much less today than back in 2005 when there were 4,549 pending sales in a month.  But, back then there were 5,146 homes on the market, a lot more than today.  Since demand is based upon the number of recent escrows, it is currently heavily muted because there are simply not enough homes that have entered the fray.  If there was a surge in the inventory tomorrow, there would be a surge in demand as well. There are throngs of buyers waiting in the wings for a fresh supply of homes.

This market will remain extremely frustrating until the supply of homes increases.  It appears as if that is not going to happen soon and the tight inventory will remain a major issue in 2013 and a stumbling block for many buyers to successfully purchase.  The tight inventory will also encourage homeowners to place their homes on the market and aggressively pursue the market by pricing their homes well above the last comparable pending or closed sale.  Unfortunately, many will drastically overprice their homes and they will sit on the market and procure no offers.  Buyers are willing to pay more for a home, but are not willing to absurdly overpay. 

Pricing a home is a delicate balancing act that requires a homeowner to carefully analyze the local market and the rate of appreciation.  Remember, homes may increase in value by as much as 10% in a year, but not in a month.  Carefully selecting a REALTOR® is a must.  Finding one that knows the local data and market dynamics is essential to success.  Hiring somebody solely based upon a projected sales price is foolish.  Instead, look for somebody that understands the market the best and has a strong command of the data.

Active Inventory:  The inventory remained the same.

The inventory started the year at the lowest level since tracking the active listing inventory back in 2004.  Since then the inventory has only added an additional 111 homes.  In the past two weeks it actually dropped by 4 homes and now sits at 3,272 homes.  The inventory sits at an unprecedented anemic level.  For proper perspective, just ask any buyer who has seen the few available homes and written several offers to no avail.  They will tell you how they are watching the market like a hawk, ready to pounce on the next home that hits the market that closely matches their parameters.  The only problem, when there are this few homes, too many other buyers are doing the same thing. 
So far this year, there have been 17% fewer homes placed on the market compared to last year, which represents 918 homes.  The buyer masses waiting in the wings would appreciate an additional 900-plus homes on the market.  The anemic levels are here to stay for the foreseeable future.  Last year at this time there were 7,597 homes on the market, 4,325 more than today.

Demand:  Demand continued to rise.

In the past two weeks, despite very few homes entering the market, demand increased by 11%, or 291 pending sales, and now totals 2,887.  It has grown by 33% in the past month, or 715 pending sales.  Compared to last year at this time, there are 682 fewer pending sales today.  In 2012, the market was sizzling forward at a breathtaking speed, fueled by a much larger inventory.  Today’s demand is strongly dependent on the inventory.  As soon as the inventory increases, demand will increase.  Until then, you can expect continued, subdued, muted demand.

The Distressed Market: The distressed inventory dropped by 11 homes, a 3% drop.

The distressed inventory continues to drop, shedding an additional 11 homes, which amazingly represents 3% of all foreclosures and shorts sales on the market.  There are 339 distressed homes within the active listing inventory, just 10% of the total active listing inventory.  There have not been this few distressed listings since April 2007, nearly six years ago. 

In the past two weeks, the foreclosure inventory increased by 24 homes, totaling 117, and has an expected market time of 25 days. The short sale inventory decreased by 35 homes in the past two weeks, totaling 222, and has an expected market time of 11 days.  Short sales continue to be the hottest segment of the Orange County housing market today.

Removing PMI Insurance from your monthly mortgage payment

If you or anyone you know has a loan that has Private Mortgage Insurance attached it can be removed.  This additional cost applies when a home is purchased with less than 20% down.  To remove PMI:

  1. Once you’ve made enough payments to boost your equity to 20% of the original purchase price, you can ask your lender to cancel PMI.  By law, the lender must cancel PMI at this point as long as you have a history of on-time payments.  You can establish that the property value has not declined and there is not a subordinate lien — such as a home equity loan — on the property.
  2. If you can’t get PMI removed at the 20% level, it gets easier once you reach 22% equity (based on the original purchase price).  At that point, the lender must automatically cancel PMI as long as you are current on your payments.  For certain loans defined as “high risk” by the lender, you must wait until you reach 23% equity.

Loans by FHA and VA don’t apply this rule.  Any problems with a lender contact the Federal Trade Commission or our State Attorney General.

Good News for Short Sale Sellers… and How the Fiscall Cliff provisions affect you, your home and your taxes

On January 1 both the Senate and House passed H.R. 8, legislation to avert the “fiscal cliff.” The bill will be signed shortly by President Barack Obama. Below are a summary of real estate related provisions in the bill:

REAL ESTATE EXTENDERS:

  • Mortgage Cancellation Relief is extended for one year to January 1, 2014 (This is huge.  Many of you toward the end of the year did not consider “short sale”ing your home to reduce your financial burdons because you were concerned about income tax consequences.  Please talk to your tax advisor to have him firm that the coast is clear until the end of 2013.  With an abundance of buyers on the market, I can help you set up a quick and virtually seamless short sale transaction that retains privacy and peace of mind.)
  • Deduction for Mortgage Insurance Premiums for filers making below $110,000 is extended through 2013 and made retroactive to cover 2012
  • Leasehold Improvements: 15 year straight-line cost recovery for qualified leasehold improvements on commercial properties is extended through 2013 and made retroactive to cover 2012.
  • Energy Efficiency Tax Credit: The 10% tax credit (up to $500) for homeowners for energy improvements to existing homes is extended through 2013 and made retroactive to cover 2012.

Permanent Repeal of Pease Limitations for 99% of Taxpayers
Under the agreement so called “Pease Limitations” that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high income filers. These limitations will only apply to individuals earning more than $250,000 and joint filers earning above $300,000. These thresholds have been increased and are indexed for inflation and will rise over time. Under the formula, the amount of adjusted gross income above the threshold is multiplied by 3%. That amount is then used to reduce the total value of the filer’s itemized deductions. The total amount of reduction cannot exceed 80% of the filer’s itemized deductions.

These limits were first enacted in 1990 (named for the Ohio Congressman Don Pease who came up with the idea) and continued throughout the Clinton years. They were gradually phased out as a result of the 2001 tax cuts and were completely eliminated in 2010-2012. Had we gone over the fiscal cliff, Pease limitations would have been reinstituted on all filers starting at $174,450 of adjusted gross income.

Capital Gains

Capital Gains rate stays at 15% for those the top rate of $400,000 individual and $450,000 joint return. After that, any gains above those amounts will be taxed at 20%. The 250/500k exclusion for sale of principle residence remains in place.  (Chances are you fall into the 15% category, so if you need to sell an investment property this year, the extra 5% capital gains tax won’t affect you.)

Estate Tax
The first $5 million dollars in individual estates and $10 million for family estates are now exempted from the estate tax. After that the rate will be 40 percent, up from 35 percent. The exemption amounts are indexed for inflation.

NEWS FLASH – We may be losing our Mortgage Interest Deduction – Please Help!

Call your member of congress today to protect the mortgage interest deduction
Congress, as part of negotiations on avoiding the “Fiscal Cliff,” has made direct references to “closing loopholes” and “limiting deductions” as a way to raise revenues. Clearly, the mortgage interest deduction is high on this list of revenue raisers.

Losing the mortgage interest deduction will disproportionately affect the middle class because a larger proportion of the middle class takes the deduction. In California 89% of those who took the mortgage interest deduction earned less than $200,000. Losing the deduction would cost the average California taxpayer over $3,900 (Way more than this in Orange County).

What you can do to help:

Call Congress. First and foremost, I am urging my friends and clients to call Congress @202-224-3121. The Capitol switchboard operator will help callers identify their member of Congress and connect them. The hours are Monday-Friday from 9 a.m. – 6 p.m., Eastern Time.

Get the word out. Many people seem to be blissfully unaware that their mortgage interest deduction is in danger. Please do the following to make sure that the message spreads.

  1. Forward this message to your family, friends, and clients.
  2. Post this information on your personal and office websites and blogs.
  1. Share this information on Facebook and urge others to share it as well.
  2. Tweet about it on Twitter and urge others to retweet. Use the hashtag: #keepthemid.
  3. Link to the following web page: www.KeepTheMID.com.  This site has information about contacting Congress, more information on the MID, and links to articles.
  4. As you see new information and articles, share these on all your social networking sites.

This affects all present and future homeowners.  Your call to your Congress member is invaluable.

Housing demand in Orange County is so low that it cannot be measured

This is a continuation of yesterday’s piece on the status of the market.  The active listing inventory is muted this year because many homeowners are still underwater.  They may have good credit and a stable job, but they do not have the cash necessary to close because they are currently too far underwater.  Also, many homeowners are now sitting on the fence while they recoup their equity.  Everybody is familiar with the term “buy low, sell high.”  It appears as if the bottom of the market was reached last February and now buyers are flooding the market attempting to “buy low.”  Homeowners know it is a low, so they want to wait.  They don’t want to “sell low.”

 DemandThe lack of inventory is cutting into demand.

As discussed above, true demand is much higher than demand based upon the number of new pending sales over the prior month.  In the past two weeks, demand dropped by 470 pending sales, a 16% drop, and now totals 2,543.  Based upon the word on the street, buyers are scrambling around at anything and everything that is placed on the market right now, but there just is not enough coming on the market.  And, that will remain the case throughout the holiday market, which does not end until the second half of January, right after everybody gives up on their New Year’s resolutions.  Buyers are in a rush to buy, but homeowners are not in a rush to sell.  Instead, they are going to enjoy the holidays with the knowledge that as their homes are slowly appreciating.  Last year at this time there were 46 additional pending sales, a 2% difference.  But, there were 8,905 active listings for buyers to choose from. 

The Distressed Market: The distressed inventory dropped by only 16 homes, but that is still a 4% drop.

For buyers looking for a “deal” and looking closely at the distressed inventory, the pickings are slim.  There are only 434 total short sales and foreclosures on the market today.  Distressed homes make up only 12% of the active inventory and 34% of demand.  Last year at this time there were 3,357 distressed homes on the market, 38% of the active listing inventory and 57% of demand, much different than today.  In the past two weeks, the foreclosure inventory decreased by 12 homes, totaling 110, and has an expected market time of 18 days. The short sale inventory decreased by only 4 homes in the past two weeks and now totals 324.  The expected market time is only 14 days and continues to be one of the hottest segments of the housing market.  Both 110 active foreclosures and 324 active short sales are new lows for the year and levels not seen since the beginning of all of the distressed activity back in 2007.

Not enough homes are placed on the market to adequately satisfy the throngs

 If you have been communicating or working with me this year, the words below (written by my partner, Steven) will match up with what we have been experiencing together.  Tomorrow I will touch more on active inventory, demand and the distressed market.

Active InventoryThe current inventory is simply unprecedented.

It is extremely difficult to articulate just how low the current active inventory is today.  3,482 homes on the market is absurd.  That’s correct, the inventory dropped below 3,500 homes after shedding an additional 52 homes in the past two weeks.  That’s only a 1% drop and the lowest drop since the beginning of August. This really could be the end of the unabated 18 month plunge in the active listing inventory.  There will eventually be an end to the drop and a new low will be established.  It almost seems impossible for the plummet to continue at this point.  It was surprising when it dropped below 4,912 homes in August, the prior record low level reached in early 2005.  Yet, it managed to drop by an additional 1,430 homes.  Last year at this time there were 8,905 homes on the market.  That’s 5,423 more than today.

REALTORS® from the trenches are reporting staggering open house attendance. They are getting as many as 75 buyers attending an open house in December. Remember, this is the Holiday Market, when buyers are typically diverting their attention away from their pursuit of their next home while they focus on Yule tide traditions.  Not this year.  Buyers are soaking up just about everything that is being placed on the market. 

 Even though we are in the midst of the holidays, multiple offers are still the norm, and so are offers above the list price.  Homes are truly appreciating based upon what buyers are willing to pay.  Many buyers put off purchasing a home earlier in the year anticipating now being a great time to buy.  That may be the case with a normal inventory, but the current inventory is far from normal.  Those buyers are waiting in line along with the multitude of buyers who have been unsuccessful in their pursuit thus far.

 Homes simply are not coming on the market this year compared to every other year in the past decade.  There are 16% more homes placed on the market in 2011 versus 2012.  In real terms, that’s 460 additional homes coming onto the Orange County housing market every single month.  Just prior to the housing turn, in 2005 there were 53% more homes placed on the market than today.  That’s 1,581 additional homes every single month. 

This chart illustrates just how anemic the inventory has been this year.I track demand based upon the number of new pending sales over the past month.  With the overwhelming number of buyers actively looking today but unable to purchase due to an unprecedented lack of inventory, true demand is much higher than what I am able to track through the Multiple Listing Service.  Quite simply, if a normal flow of homes were placed on the market, there would be a lot more pending sales each and every month this year. 

So, even though it is the Christmas Season, this is a great time to put your home on the market.  Your decorated and cozy home will attract buyers, and if marketed to its fullest extent will bring multiple offers and sales prices that will just make your year!