Can We Save the Long Beach Condo Market?
Leave a comment »The Long Beach condo market experienced a significant decline before the mortgage credit crunch started. In fact, Southern California was one of the markets that promulgated the credit crunch with its higher than normal foreclosure rate. On August 2, 2007, American Home Mortgage went belly-up, sparking a chain reaction of A paper lenders to close their doors, permanently. 262 lending institutions have “imploded” since the sub-prime mortgage decline in late 2006. The mortgage industry contraction has exacerbated the Long Beach housing market decline, especially the condominium market.
It doesn’t have to stay like this.
Condominium management associations are dealing with stressed out homeowner associations who are responding to angry homeowners. “Where are all the qualiied buyers?", they demand. “Why is the Long Beach condominium market in a free fall?”
I have the answer. Nobody can get financed. Well, nobody is a strong word; very few can get financing for Long Beach condominiums. On June 2, 2008, Fannie Mae severely limited its approvals for Long Beach condominium financing; now, you need at least 10% downpayment to get a loan for a condominium….UNLESS…
…you read carefully. I know how to stop these prices from dropping like a ball off a table;
government financing.
That’s right, FHA or VA loans can save the Long Beach condo market. They don’t have “declining market” adjustments, aren’t relying on PMI companies to insure loans with a down payment of less than 10%, and offer competitive loan terms to borrowers. The problem with FHA/VA home loans in Southern California? Most condominium complexes are NOT approved for government loans. If you’re a condo owner, or a HOA board member, or an association management company employee, you can check to see if the complex is approved for:
If your complex isn’t approved for government loan financing, you have effectively cut the pool of potential buyers by two thirds. Many Long Beach condominium buyers are first-time home buyers and don’t have 20% down payment. When you limit the pool of potential buyers, you work against the already stabilizing housing market in Southern California.
While house prices may rise, later this year, Long Beach condominiums can still decline in value because of poor management. Can you afford to have your property investment go sour because of laziness or lack of information? It doesn’t have to be that way.
Call me and I’ll help assist you in the government loan approval process. It may take 4-6 weeks and will probably cost the association about $2,000 to get the complex approved. While that may sound costly, I assure you that your homeowners will be ecstatic that you’ve stabilized their property value.
Brian Brady is a San Diego-based mortgage banker and can be reached at 858-777-9751
| Laurie MannyLong Beach Realtor (562) 212-5420 |
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Main Street Realtors Belmont Heights 244 Redondo Avenue Long Beach California 90803 |
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