Long Beach Mortgage Rates Report: September 17, 2008

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Holy Heat Miser, Batman…it’s a meltdown! Had you taken my advice this weekend, and immediately locked your mortgage rate yesterday, you would have lost out.  The par rate for a 30-year fixed rate conforming loan was 5.625% yesterday- today that par rate is 5.5%.  My advice would have cost you .125% in rate.  Alas, my mortgage rates report is not about “catching the bottom” as much as it is about “avoiding the top”; it’s about mitigating market risk.  From my explanation on the Zillow Mortgage Blog:   My approach is with an aversion to risk so I’m biased towards locking rather than floating a rate.  What I do try to find is overreactions in the MBS market so that you won’t lock your mortgage rate at the top nor float your mortgage rate when higher rates are imminent.  My customers RARELY catch the “bottom” but they miss out on many “tops” when locking their rate. I look for irrational exuberance or irrational fear.  If I think markets are being too optimistic, like this week, I advise customers to lock.  The whipsaw reaction to irrational exuberance is irrational fear; a steep rise in mortgage rates.  THAT is what I want to avoid.   Long-term, I feel that the government bailouts of financial institutions will result in a hefty price tag to the taxpayer, which is inflationary in nature.  I look for markets to start reacting to this sooner rather than later. If you have a definitive closing date for the purchase of your home, lock-in your mortgage rate today.  If you’re shopping for a new home. locking your mortgage rate at contract acceptance is advisable.  If you are one of the fortunate few with equity, good income, and good credit, and want to refinance your home loan, today looks better than next year.  I’d love to discuss your options with you. PS:  In my last report, a Florida mortgage broker suggested that my risk mitigation strategy is inferior to a “lock and pray “approach:   Bottomline, none of us knows what is going to happen, so the smartest course is to lock with a lender that will renegotiate your rate when we experience one of these rapid drops that occur with little advance notice.   I’ll agree that prescience is a virtue best reserved for the Divine.  My faith in the predictability of mortgage lenders’ actions has been shaken over the last year.  I’ve seen lenders flip programs to make an extra buck and back off approvals.  While this gentleman’s strategy has proved superior to mine, this month, I still rely on my charts and research to execute low rates for my customers. Long Beach mortgage rates report is offered courtesy of Brian Brady.

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Long Beach Mortgage Rates Report: September 17, 2008

Thinking about Selling YOUR Long Beach Homes or Condos?

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This week the California Association of Realtors (CAR) released its 2008 Survey of California Home Buyers; the results do not come as a surprise to those of us with our finger on the pulse of the Southern California and Long Beach real estate market.  2008 saw more statewide home purchases than 2007; 69% of buyers state that lower prices, and 40% attractive interest rates, were the deciding factors in their purchase. 77% of first time buyers said that lower home prices were the reason they purchased homes. 

 

The Internet has become the go to place for buyers beginning their home search and to find their Realtor®. 

• 2008 – 78%
  
• 2007 – 72%

 

Buyers are spending more time and viewing many more homes and condos than in prior years.  They are also spending a considerable amount of time searching on the Internet prior to contacting an agent; often as much as 2 months or more. 

 

Barry Cunningham wrote a rather accurate depiction of the current state of affairs over on the Sellsius Blog.  He explains that the survey revealed:

 

“96 percent of Internet buyers expected a response within four hours or less…31 percent of the Internet group expected an IMMEDIATE response! 84 percent of participants ..let me say that again…84% of buyers said that they considered the agent’s response time to be either a “very important” or “extremely important” factor in their decision-making process.”

 

After reading the results of the survey
Barry ran an experiment calling 20 Realtors on Friday morning and another 20 on Saturday morning.  The results?  2 agents answered their phone and only 4 called him back.  Yeah, that’s pretty bad.  We agents are running into the same problem.  Searching for homes for buyers often requires research and feedback from the listing agent prior to even considering showing a home.  Just last week I was researching available homes with Mills Act status in 3 historic neighborhoods: 

 

• Bluff Park Historic District
• California Heights Historic District
• Belmont Heights Historic District

 

With none currently available on the market the next step was to search for homes that might qualify for Mills Act after purchase.  I called 7 agents on Thursday and received 1 call back as of today.  Sellers, pay attention here, these are your listing agents!  My buyer lives on the East coast and was going to make a trip here to view these homes with the intention of purchasing one, he has to purchase, he is in a 1031 exchange and the clock is ticking.  Your Long Beach homes will not be shown, he has cancelled his travel plans and will have to make other arrangements.  One of the 7 of you was about to sell your home – not going to happen for now. 

Barry asks if Real Estate Agents have given up.  It appears to be so for some.  I think some have and more will follow in short order, there just isn’t enough business to support the amount of Realtors with active licenses.  One would think this alone is reason enough to be all over your business and jumping on those phones, but apparently it is not.  I suspect that many of these agents have sought employment and cannot take real estate related calls if they want to keep their other jobs.  But that leaves me scratching my head about the other 4 days the calls weren’t returned, so I guess I don’t have an answer here either.  I’m stumped, which brings up another issue.  If one of these agents listings go into escrow and the listing agent is gainfully employed elsewhere, how are they going to handle the barrage of paperwork and phone calls?  Escrow and Title Companies as well as most lenders work Monday thru Friday, from 9 – 5.  Do you know if your listing agent is available to handle the sale of your Long Beach home or condo? Are you sure?

Some agents consider themselves to be “listing agents”, others “buyers agents”.  The truth be told we are agents that handle both buyers and sellers, these are just personal preferences.  In the hot sellers market I worked with mostly sellers and some buyers.  It wasn’t a choice, listings, when handled properly, are a lot of work, if you are carrying a lot of listings there isn’t a whole heck of a lot of time to be researching for buyers and for showing properties, handling the phone calls alone can become a full time venture.  In the current market I find myself turning down most listings and working with more buyers.  This year I have declined close to 80 listings.  Why list homes that will not sell either because the seller wants more than the market will bear, is upside down or doesn’t have the funds to put the home into sell-able condition?  It just doesn’t make sense when buyers have so many viable choices. 

 

Does it sound strange to hear that a Realtor® is turning business away in this market?  We are not just agents.  We are business owners and as such need to make management decisions.  Not taking listings that won’t sell is a very smart business decision.  Listings cost a great deal of money and time to market when they are handled properly.  Taking 80 listings that probably won’t sell in this kind of a market would likely lead to bankruptcy.  I love what I do and will not jeopardize my business. 

 

No agent understands contracts better than a highly experienced listing agent.  They not only need to understand those contracts from the buyers perspective, they need to be in a strong position to protect their seller.  Buyer agents with little contract experience on the listing side are often not strong enough to protect the sellers interests when they list homes.  I love getting one of these as a listing agent when I am representing a buyer.  Can you say lunch?  

 

Buyers shopping today’s real estate market are looking to get the absolute most for their money.  Who can blame them?  When else will they ever have such an opportunity to purchase a lot of home for an amount they can afford?  Purchasing long Beach real estate is not a game, it is an investment in your future.  When prices are down it is smart to buy as much house or condo as you can handle comfortably.  Buyers are taking their time and continuing to look around even after they think they have found the right home, often for several months, sometimes they will find an even better one.  Who can blame them?  It’s just smart business, it’s not just a home, it’s an investment. 

The study said that today’s consumer is not satisfied with the performance of their real estate agent; 80% stating that their agent did not negotiate aggressively on their behalf.  Barry says “Thats completely understandable since most real estate agents are not trained negotiators.”  He’s right! Negotiating is not taught in real estate training.  Either the agent has those skills coming in or they develop them – or not.  Would you like to know what else is not taught?  How to price your homes!  Scary, isn’t it?  We either have it, or we don’t.  Barry is right when he states that negotiating is more than passing counter offers back and forth.  There is a whole lot more to it before that contract is even written and all the way through to the close of escrow.  The negotiating doesn’t stop until the deal is closed.  Both buyers and sellers need to really get to know what their agent is all about before they begin to work with them.

 

In all fairness, some buyers and sellers have to own the responsibility for choosing the wrong agent to work with.  Hey just because you or somebody you know, knows them doesn’t make them the right agent for you, and it doesn’t make them good at what they do.  Hire smarter the next time. 

Earlier this year Joel Singer, the Executive Vice President of C.A.R. invited me up to HQ to participate in a small round-table of Realtors® to discuss the effects of social networking on the real estate industry (there is a video on the CAR site as well, can’t locate it at the moment).  4 of us from around the state participated.  While we all went about social networking in somewhat different ways, the one thing we all agreed upon was that if you don’t have a heavily trafficked blog site, and a very strong online presence, you are going to get buried in the very near future.  Barry says we need a well marketed, SEO intensive Blog or website if we are to survive in this industry.  He is right, I have been saying this for over a year and a half now.  I have a few of those , they work, nuff said? 

 

The consumer (buyers) are shopping on the Internet.  Actually most of them are shopping on:

• Google, 40%
• Realtor.com 28%
• Yahoo Real Estate 8%
• Zillow 5%
• Specific home site 4%
• Craigslist.org 3%
• Unsure 13%

I’m smiling here.  Having one of the strongest online presences in the Long Beach Real Estate online market kinda takes a lot of the stress off .  33% of the participants in the survey said that Real Estate agents sites were the most useful tool in their home search.  Why wouldn’t they be?  We know our market better than anybody else, we work it every day.  The information on our sites reflects that.

 

Single property websites don’t work.  Do you want to know why?  Because they are website based and are new sites with new URL’s on them.  It will take them months to ever be found, by that time either your home will have sold, be coming off of the market or going into foreclosure! 

 

For Sale signs used to generate a lot of phone calls, especially on weekends.  Not true any longer.  Gone are the days of buyers driving around on weekends looking for open houses and calling on signs.  Today’s buyer is sitting in the comfort of their own home shopping on the Internet, looking at pictures, videos and slide shows of Long Beach homes and condos they are considering.  When they are ready, they pick up the phone and make an appointment to view the home.  Yep, open houses are pretty much toast as well.  Why would a buyer want to run all over town on your schedule when they can shop on theirs? 

 

Barry wants to know what we (Realtors®) are going to do with this information.  I have decided to pass it on to you, the Long Beach Buyers and Sellers.  What are you going to do with it?  

 

Please visit my Long Beach sites, Google loves them and I hope you will too!

 

 

 

 

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Thinking about Selling YOUR Long Beach Homes or Condos?

Long Beach Mortgage Rates Report: September 13, 2008

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The mortgage backed securities market has improved dramatically since the new FHFA seized Fannie Mae and Freddie Mac.  An implicit government backing of mortgage bonds became explicit with that single event.  The rate difference, or spread as we call it, between govʼt bonds and mortgage bonds, has narrowed from abnormally high margins.  This means that mortgage rates dropped as much as .375% since the govʼt takeover.  Alas, I think that party is a bit short-lived.  The exuberance appears to be a bit irrational and the reality of impending bank failures has worried the mortgage backed securities market again.    Short-term, Iʼm advising clients to lock-in these low rates and be done with it. For borrowers with a 30 day time period until closing, Iʼm advising that they lock as well.  Rates may spike up and come back down,  to these below 6% levels, but I donʼt see a great opportunity for the medium-term to improve upon todayʼs already low rates.   Longer-term, mortgage applicants may find mortgage rates higher than they are today.  The realization that SOMEONE has to pay for this bailout will hit everyone, after the election, and treasury bond yields should rise, pushing the mortgage backed securities yields, and mortgage rates, higher as well.  Not a rosy picture. So, lock those loans at application. While the current 30-year fixed rate loan offering, with 1% origination fee, is 5.75%, for a conforming loan (6.02% apr),  the risk of those rates popping up to the 6% level far outweighs the reward of holding out for 5.625%.   Long Beach mortgage rates report is offered courtesy of Brian Brady.  Contact Brian for more information about a home loan. Brian J. Brady World Wide Credit Corp (858) 777-9751 PS- Please check out my references on LinkedIn

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Long Beach Mortgage Rates Report: September 13, 2008

911 – An American Tragedy – We Will NEVER Forget!

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Today we remember those whom are gone forever…

Open the victims list in Excel

7 Years Ago Today

We will NEVER forget!

We will ALWAYS remember

Thank you NYC Fire Fighters

Imagine

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911 – An American Tragedy – We Will NEVER Forget!

Long Beach Real Estate Sales – Market Report – Statistics – 2008

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Long Beach Real Estate News

Long Beach California Real Estate Sales Update

 

 

The Long Beach Real Estate Market has been shifting a bit this year. After a very slow start in January, Long Beach home sales are up by over 100% on a monthly basis as of August. Long Beach Condo sales, still very weak, have been increasing on a monthly basis, almost doubling by August.  Downtown Long Beach is home to a great many condominium complexes; clearly 25% of all Long Beach condo sales this year have been in the Downtown area.  This makes sense, Downtown is still very affordable and affordable sells in this market.  The redevelopment in Downtown Long Beach has made living there very desirable. 

 

While residential real estate sales in Long Beach are down a bit from the same time in 2007; sales of income properties are down substantially. The Long Beach income property sector has been extremely hard hit with large decreases in annual sales 2006 through 2007.  2008 has not offered a reprieve for owners of these investment properties.  Prospective buyers of income properties are learning that large down payments are now necessary to purchase units whether they are owner occupied or not.  The banks, hard pressed to cover these loans, have raised the bar on qualifying.  It is not unusual for a bank to demand a 40% down payment and excellent credit before even considering a loan for apartments. Still, some sellers need to sell and there have been a few very sweet deals that have closed this year, some all cash, the rest with large down payments or seller financing. 

 

Long Beach stock co-ops and Own Your Owns-OYOs remain difficult to purchase with little financing available and large down payments required.

 

Prices seem to be stabilizing in some Long Beach neighborhoods, while others are still facing further declines.  Neighborhoods plagued by foreclosures and short sales are feeling the drag down effect on prices as more of these continue to come onto the market. 

 

 

Buyers shopping foreclosed homes and condos are finding them to be a highly desirable but difficult purchase.  With prices so attractive the competition for better properties has become fierce with serious investors winning many of these properties with all cash offers. Seller concessions are decreasing as the market begins to stabilize a bit.  If a buyer needs closing costs they are often building all or part of that into their loan to make the purchase where several months ago it was a given that the seller would be making that concession.  While it is still possible to attain seller concessions it is not necessarily the order of the day any longer, which may be a telltale sign of either the homes being priced right or a flattening in the market.  Time will tell.  

 

Most Realtors® and buyers have given up trying to purchase short sales unless they already have bank approval.  The banks have made the process near impossible, nobody wants their time wasted.

 

And yet, people are buying homes and condos in Long Beach and are getting some killer deals.  Great deals are out there right now.  Why do you think the investors are waving around so much money?  If you were waiting for the bottom of the market it is time to get out there now.  While this might not be the bottom in all areas its close enough to the bottom in most. 

 

Long Beach Homes and Condos that went onto the market in the spring will be expiring very soon which means some of them will re-enter the market with price reductions, some large.  Over the next couple of months some lucky buyers are going to get homes they only could have dreamed of several years ago.

Don’t you want to be one of those buyers?

 

 

 

Long Beach Real Estate – Closed Sales

January – August – 2008

2008	HOMES	CONDOS	LOFTS*	CO-OPS	OYOs	2-4 UNITS	5+ UNITS	TOTAL
JAN	72	40	2	1	0	9	6	130
FEB	94	32	2	1	1	17	6	153
MAR	107	48	2	1	0	17	4	179
1/4 ttl	273	120	6	3	1	43	16	462
APR	137	56	1	3	0	21	6	224
MAY	164	59	1	4	0	28	7	263
JUN	160	60	1	2	4	24	8	259
2/4 ttl	461	175	3	9	4	73	21	746
YTD Subttl	734	295	9	12	5	116	37	1208
JUL	183	67	1	0	1	31	8	291
AUG	181	74	0	1	4	26	3	289
YTD Subttl	1098	436	10	13	10	173	48	1788
SEPT
3/4 ttl
YTD Subttl
OCT
NOV
DEC
YTD TOTAL

* Lofts include Loft Live and Work spaces

For a little perspective, here is a comparison of the last 7 years for the same time period. 

 

Long Beach Real Estate – Closed Sales

January – August – 2002 – 2008

YEAR	HOMES	CONDOS	LOFTS*	CO-OPS	OYOs	2-4 UNITS	5+ UNITS	TOTAL
2008	1098	436	10	13	10	173	48	1788
2007	1272	650	17	12	15	241	60	2267
2006	1582	805	10	12	48	419	78	2954
2005	2010	1041	7	16	109	594	207	3984
2004	1945	900	1	11	111	536	192	3696
2003	2302	970	0	17	89	566	168	4112
2002	2326	1022	0	16	88	569	153	4174

* Lofts include Loft Live and Work spaces

 

Disclaimer: Statistics are as represented in the SoCalMLS and are not the representations of the author. The numbers represented above are only as good as the information input into the SoCalMLS by the listing agents.  If (in my opinion, may be the case) some listings of lofts, co-ops and OYOs were input as condos, then they are reflected as condo sales here.  Often listing agents will represent these as condos in the MLS in order to stimulate traffic as many buyers agents will not look at the other categories.  As crazy as this sounds it is true and sales have occurred as a result of utilizing this tactic. Therefore the information in these categories is very likely not a true representation of the actual sales, but the grand total of these and the condo category would correctly reflect the total of all – as represented by the SoCalMLS.

 

Contact Laurie to begin the search for Your Long Beach Home.

 

Long Beach Homes For Sale

 

• Long
  Beach Homes For Sale $300000 to $400000
• Long
  Beach Homes For Sale $400000 to $500000
• Long
  Beach Homes For Sale $500000 to $700000
• Long
  Beach Homes For Sale $700000 to $900000
• Long
  Beach Homes For Sale $900000 to $1200000
• Long
  Beach Luxury Homes For Sale $1200000 to $2500000
• Luxury
  Homes For Sale in Long Beach California $2.5 Million and up

 

 

Long Beach Condos For Sale

 

• Long Beach Condos For Sale $1,500,000 and higher
• Long Beach Condos For Sale $1,000,000 to $1,500,000
• Long Beach Condos For Sale $900,000 to $1,000,000
• Long Beach Condos For Sale $800,000 to $900,000
• Long Beach Condos For Sale $700,000 to $800,000
• Long Beach Condos For Sale $600,000 to $700,000
• Long Beach Condos For Sale $500,000 to $600,000
• Long Beach Condos For Sale $400,000 to $500,000
• Long Beach Condos For Sale $300,000 to $400,000
• Long Beach Condos For Sale Under $300,000

 

Long Beach Income Properties For Sale

 

• Income
  Property For Sale in Long Beach California-5+ Units
• 2
  to 4 Units For Sale in Long Beach California
• Triplexes
  For Sale in Long Beach California
• Duplexes
  For Sale in Long Beach California

 

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Long Beach Real Estate Sales – Market Report – Statistics – 2008