Urban Hillsides / Northeast LA Market review for July/August

The diverse communities of Northeast LA have a wide range of prices from the mid $100,000 price range to $1.5 million. This report covers the zip codes of Atwater Village, Echo Park, Eagle Rock, Glassell Park, Highland Park, Lincoln Heights, Los Feliz, Mt. Washington, and Silver Lake. Single Family: July / August

• Properties sold: 126 / 121
• Average days on market: 74 / 68
• Median price: $503,202 / $505,298
• Average cost per square foot: $320 / $349
• Avg. selling price to listing price: 80% / 75%

Residential Income (2-4 units):  July / August

• Properties sold: 33 / 21
• Median price: $454,348 / $418,952

Condo:  July / August

• Properties sold: 10 / 18
• Median Price: $295,250 / $262,217

Source: The MLS

Lenders improve the short sale process

short-sale

On November 1, 2012, Fannie Mae and Freddie Mac’s new self-imposed short sale guidelines will go into effect, rules which will make the short sale process easier and quicker for qualified borrowers.

The guidelines are a commitment to “enhancing and streamlining the process to avoid foreclosure and stabilize communities,” said FHFA director Edward DeMarco. Additionally, DeMarco also stated that the new short sale program will provide relief for underwater borrowers who need to relocate more than 50 miles for work.

Borrowers who are more than 90 days delinquent and who have a credit score lower than 620 will no longer be required to provide documentation of hardship. Government-Sponsored Enterprises (GSEs) will also waive the right to pursue deficiency judgments. Borrowers who are not yet in default will still qualify for a short sale if they are facing certain hardships, including death of co-borrower, divorce or legal separation, illness or disability, or distant employment transfer.

Housing inventory drop poses threat to housing recovery

With all the good news coming out about the current real estate market - improving home prices, fewer foreclosures, low mortgage rates - there is one ominous threat to this year's recovery: Inventory. RE/MAX released numbers for July and August 2012 that indicate the inventory levels are falling. July saw a 5.4 percent fall from June, and 26.8 percent from July 2011.

“Inventory is now becoming a serious challenge to this recovering market," said Margaret Kelly, RE/MAX CEO. "Home sales could be much greater if more inventory was available, especially in the lower price range, where most sales are now occurring.”

Home sales were up 10.3% from July 2011, while the average days a home was on market sold in July was 82 (a drop from previous months).

In Echo Park, 25 properties are listed currently at a median price of $569,440, a 21% increase in prices year over year. In comparison, Highland Park has about the same number of homes on the market, but a much lower median price at $440,276.

A strengthening market: Home prices rose 4.8%

According to Freddie Mac's newly released U.S. Economic and Housing Market Outlook, home prices for the country rose 4.8% in the second quarter of this year. This and other numbers indicate a strengthening market, especially as 34 states (the largest number in years) posted gains in home prices from June 2011 to June 2012.

There are many who are convinced that there’s a huge number of shadow inventory that will threaten these HPI (Home Price Index) gains. CoreLogic says shadow inventory has fallen by 28% since January 2012, but others say there are still millions of underwater homes and foreclosures that were backlogged when the foreclosure investigations started.

But Freddie Mac isn’t concerned: “While the shadow inventory persists, there is an important difference in today’s market compared with those of recent years, and that’s the substantially reduced amount of excess vacant housing,” said Frank Nothaft, VP and chief economist for Freddie Mac.

Additionally, foreclosure filings have decreased 10% over the past year, and just in July had declined 3% from June.

August Economic Outlook

Bankruptcy Auction in Ladera Heights

8-22-12 Court Date

6 bed / 4.5 bath & 4436 sq.ft.

[thethe-image-slider name="Corning"]

Spacious family home with pool and great floor plan. Property has excellent curb appeal and is located in the desirable Ladera Heights neighborhood. 6 bedrooms with 4-1/2 bathrooms, formal dining room, family room, living room, very large upstairs media room and office. Three bedrooms downstairs including master suite and three bedrooms upstairs. Gated entry to property and attached two car garage with direct access. Large covered outdoor deck off formal dining room. This is a true entertainer's house. Call for detailed court information.

• Pool
• Formal dinning room
• Gated entry
• Two story
• North of Slauson
• Very large family room
• Six bedroom plus den
• Hardwood

Property details:

• MLS: 12-594839
• Sq Ft: 4436
• Yr Built: 1954
• Bdrms: 6
• Baths: 4.5
• Pool: Yes - Private
• Parking: 2 Car Garage
• Asking: $750,000
• Address: 5519 Corning Ave., Ladera Heights, CA 90056

Contact us with questions or for more information.

Zillow's housing predictions for 2013

ForecastChartJuneQ2

Zillow just released its predictions for the housing market in 2013, saying that just under half of the markets it covers will experience an increase in home values over the next 12 months.

The graph below illustrates the Zillow estimate for Los Angeles, showing current housing price averages at $383,200, and increasing 0.5% over the next year.

Los-Angeles_HomeValue2013

Considering all the economic difficulties with a dwindling job market and debt problems in Europe, a stabilized housing market is something to look forward to in the next year.

Green certified homes can turn into a good investment in California

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Is going green in your home a good investment? According to a new study, it could be! California homes sold between 2007 and 2012 saw an average of a 9% increase in its value because of green certification. It's a bonus for areas where consumer sentiment is more supportive of environmentally friendly options (for instance, in those areas where there were a lot of Prius owners!), and if you're beach side, even better. The study sampled 1.6 million homes, of which 4,321 were sold with Energy Star, LEED or GreenPoint Rated labels. The goal was then to determine how much that green labeling factored into the selling price. While the National Assn. of Realtors believes any mandatory labeling could have severely negative effects, the National Assn. of Home Builders sees it as an advantage.

Eco-friendly and green homes are a popular choice for Northeast Los Angeles, especially if you're in the vibrant communities of Echo Park and Highland Park. There are multiple home tours each year, including the popular Dwell on Design and deLab Echo Park house tours, which feature many significant green homes here in Echo Park. My most recent listing that was green certified was in Echo Park, and included 10,000 square feet of certified farm and wildlife habitat, plus other green features. That home sold fast!

If you have a green-certified home you're thinking about selling, or you're looking for one - give me a call. I also have great resources available if you're looking to get certified and improve the long-term value of your home.