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go to the original content page found here: http://www.homeispalosverdes.com/palos-verdes-homes-value-smartvalue-algorithm/

So after using the free tool above, you’re welcome to contact me and set an appointment to have me view your home. Let’s study the data, let’s figure out how these variables in relation to Palos Verdes homes now on the market and recently sold, affect how much the market will pay for your home. You can use the contact pop up screen here on this page or just pick up the phone and call me at 310.346.6467.

Palos Verdes homes and SmartHomeValue

Remember, the SmartHomeValue is computed using a proprietary formula. It is not an appraisal. It is a starting point in determining a home’s value. The SmarthHomeValue is calculated from public information and again, can not take into account the intangibles of views, lot utility and size or condition of Palos Verdes homes or any other real estate in the South Bay for that matter. Use the 30+ years experience I have serving my clients here in Palos Verdes and the South Bay. You can count on me to tell you the truth and not behave in a way that sadly too many agents fall prey to; telling a prospective home seller what they want to hear just to get the listing. When you want facts and the truth, you want me working for you.

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But when they report “Tim Iacano of Iacano Research credits the majority of the recovery and rise in home prices—if not all of it—to the Federal Reserve’s aggressive actions to keep mortgage rates low. The Fed’s quantitative easing (QE) program has prompted mortgage rates to fall to all-time lows in recent weeks.” they are missing a critically important law of economics.  They don’t even talk about the issue SUPPLY & DEMAND. 

Interest rates are so low, that even if they were to go up 1-2 percent, they would still be incredibly low relative to decades long historical standards.  So it can’t be that low interest rates are sole driver let alone major contributor as Mr. Iacano would have us believe.  While I can’t speak for a national real estate market, I can certainly provide you hard fact documentation on Palos Verdes home prices and what is happening with the supply & demand dynamic for Palos Verdes homes as well as for the Greater South Bay area.

Let’s take a look at what’s happening. Palos Verdes Home Prices trends are patterning this chart on the South Bay

You can email me for a larger copy of this chart if you wish.  The red trend line shows the volume of Pending Sales going back to May of 1990 (yes, I keep track), the blue line tracks the New Listing Volume.  Think of Pending Sale Volume as a measure of demand and think of New Listing Volume as a measure of supply.  Clearly, it’s starkly evident, the number of new listings coming to market is the lowest it’s been in nearly 20 years!  At the same time that supplies have been dropping of Palos Verdes homes and other homes around the South Bay, demand has been picking up. 

We all know what happens when people want more of something, but that something is less and less available.  And as you can see by green line, prices indeed have been firming, in fact they’ve been going up.

Visit this link to get more information on Palos Verdes Home Prices.

+George Fotion

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Christmas in Palos Verdes & the South Bay 2012 –

Birth of a New Tradition

As the holidays approach, the giant overseas factories are kicking into high gear to provide Americans with monstrous piles of cheaply produced goods –merchandise that has been produced at the expense of American labor. This year will be different.

This year Americans will give the gift of genuine concern for other Americans. There is no longer an excuse that, at gift giving time, nothing can be found that is produced by American hands. Yes there is!

It’s time to think outside the box, people. Who says a gift needs to fit in a shirt box, wrapped in foreign made produced wrapping paper?  Everyone — yes EVERYONE gets their hair cut. How about gift certificate from your local Palos Verdes hair salon or barber? Gym membership? It’s appropriate for all ages who are thinking about some health improvement.

Who wouldn’t appreciate getting their car detailed? Small, American owned detail shops and car washes in the South Bay would love to sell you a gift certificate or a book of gift certificates. Are you one of those extravagant givers who think nothing of plonking down the US dollars on a foreign made flat-screen?

Lots of Palos Verde homes owned by friends, family or colleague of yours could use a bit of sprucing up!  Perhaps that grateful gift receiver would like something for their Palos Verdes home; his driveway sealed, or lawn mowed for the summer, or house painted, or roof repaired or games at the Los Verdes golf course or ….

There are a bunch of owner-run restaurants in Palos Verdes and around the South Bay — all offering gift certificates. And, if your intended gift receiver isn’t the fancy eatery sort, what about a half dozen breakfasts at the local breakfast joint, like at “Eat at Joes”. Remember, folks this isn’t about big national chains — this is about supporting your local Palos Verdes home town Americans with their financial lives on the line to keep their doors open.

How many people couldn’t use an oil change for their car, truck or motorcycle, done at a shop run by the American working guy? Thinking about a heartfelt gift for mom? Mom would LOVE the services of a local cleaning lady for a day.

What about computers, maybe your intended gift receiver could use their computer tuned-up, and I KNOW I can find some young guy who is struggling to get his repair business up and running. OK, you were looking for something more personal. Local crafts people spin their own wool and knit them into scarves. I know many artists here in Palos Verdes and throughout the South Bay.  They make jewelry, and pottery and beautiful wooden boxes.  There are scores of local artists and artisans eager for your business.

Plan your holiday outings at local, owner operated restaurants and leave your server a nice tip. And, how about going out to see a play or ballet at your hometown theater. Musicians need love too, so find a venue showcasing local bands.

Honestly, people, do you REALLY need to buy another ten thousand foreign made lights for the house? When you buy a five dollar string of light, about fifty cents stays in the community. If you have those kinds of bucks to burn, leave the mailman, trash guy or babysitter a nice BIG tip.

You see, Christmas is no longer about draining American pockets so that foreign economies can build another glittering city. Christmas is now about caring about US, encouraging American small businesses to keep plugging away to follow their dreams. And, when we care about other Americans, we care about our communities, and the benefits come back to us in ways we couldn’t imagine.

THIS is the new American Christmas tradition.  This is also one way of putting SPIRIT back in Christmas.

Please share this with others.  And if you need lists of folks who own local businesses from whom you can get gifts from, let me know!  I know LOTS of people!

This is a revolution of caring about each other and isn’t that what Christmas is about?  I’m going to create a facebook page where you can post your ideas on where to get gift certificates and thereby patronize to help local Palos Verdes businesses and get some great gifts at the same time for your friends and family.  Post often right here!

https://www.facebook.com/PalosVerdesBusinessToBusiness

+George Fotion

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George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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I found this article written by HEATHER ELIAS who is the Director of Social Business Practice at National Association of Realtors.  As I more than occasionally get questions about the ObamaCare 3.8% Tax on the “sale of Palos Verdes homes and South Bay homes”, I thought I would just distribute her article word for word with all the hyperlinks active.  This way, you can get the straight unfiltered information.  Hope this helps clear up questions.  Personally, I believe this to be an onerous tax, but you can, of course, decide for yourself.            Last week, I wrote a post here about the 3.8% tax that is part of the Health Care Reform Act, which passed in 2010. There have been numerous emails circulating that mischaracterized how the tax worked, and here at NAR we wanted to help people understand it better. The post created a flurry of comments, and I thought we would address some of the points raised directly. (I’m taking some of my clarification points directly from The Top 10 Things You Need to Know about the 3.8% Tax.) Yes, it is a tax. But it’s not a sales tax, it’s a tax on investment income. No, NAR does not support this tax. It was added into the health care law at the last minute and was never considered in hearings.The tax will no doubt be debated during the upcoming tax reform debates in 2013. When you add up all of your income from every possible source, and that total is less than $200,000 ($250,000 on a joint tax return), you will NOT be subject to this tax. For the tax to apply to any profit or gain on a primary home sale, the profit/gain must be more than the $250,000-$500,000 capital gains exclusion that’s in effect today. That’s gain, not sales price. The tax applies to other types of investment income, not just real estate. If your income is more than the $200,000/$250,000 amount, then the tax formula will be applied to capital gains, interest income, dividend income and net rents (i.e., rents after expenses). If you are concerned that this tax may apply to you, please consult your tax advisor. NAR is nonpartisan and does not get involved in presidential politics. Here is a video with NAR’s director of tax policy, Linda Goold, that does a very good job of explaining: And here are some more resources that could help explain: Top 10 Things You Need to Know about the 3.8% Tax 3.8% Tax: What’s True, What’s Not The 3.8% Tax is Not A Real Estate Transfer Tax Washington Post: Health-care law’s 3.8 percent surtax will not affect many home sellers

+George Fotion

What are Palos Verdes Home Prices doing? How about for the South Bay? George Fotion, HomeIsPalosVerdes.com

Homes for sale in Palos Verdes Estates Homes for sale in Rolling Hills Estates Homes for sale in Rancho Palos Verdes Homes for sale in Rolling Hills South Redondo Beach homes for sale Hermosa Beach homes for sale Manhattan Beach homes for sale South Torrance homes for sale George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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The market for Palos Verdes Homes …

… is getting better but are we out of the woods yet?

I’ve been studying the South Bay Home trends and Palos Verdes Homes trends for over 20 years now and have been keeping detailed records on the market. 

This has helped me immensely in guiding my clients, both buyers and sellers so that they are empowered with the best information to make intelligent, deliberate and provident decisions.

Based on the data at hand, here are my latest conclusions.  If the player does not appear below, please go here: Latest Palos Verdes Real Estate Trends

Now that you’ve seen there are some very positive signs in the market, consider owning one of the best Rolling Hills homes just listed this week at 11 Ranchview Road!

Continue here to view more Palos Verdes Real Estate trends (yellow tab below)

Homes for sale in Palos Verdes Estates Homes for sale in Rolling Hills Estates Homes for sale in Rancho Palos Verdes Homes for sale in Rolling Hills South Redondo Beach homes for sale Hermosa Beach homes for sale Manhattan Beach homes for sale South Torrance homes for sale

George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

George Fotion, HomeIsPalosVerdes.com

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Even if you’ve been around the South Bay a long time like I have (1968 as a 12 year old …. ok, fine … do the math) you realize there’s still a lot to learn about the South Bay. I would like to introduce you to Jackie … she has a wonderful blog that is full of South Bay events.  It’s a fun read and I promise you, you will come away from her site saying, “…hmm, I didn’t know that!…” I received this email from Jackie today and thought I would share it with y’all … why not give her blog a try.  I think you will like it.  I especially liked her comments on the PVLC… who knows, maybe I will see you out on the trails!  Then when you’re done reading her blog, you also might find yourself wishing, “…Hmmm, I wish lived over in the _______ area instead of where I do now…”  When THAT thought happens, you know what to do.  Follow the link in the yellow tab at the bottom of this article … ENJOY! So what are you doing this weekend? I’m looking forward to playing in the Hermosa Beach Firefighters Poker Tournament this Saturday night. I was knocked out of the competition by a four-of-a-kind hand at last year’s event and I really need to redeem myself! Wish me luck! The Space Shuttle Endeavour will be making its final journey through the streets of Los Angeles on the way to its new home at the California Science Center. Endeavour will leave LAX on Friday, October 12, for a two day road trip, arriving at the Science Center on Saturday, October 13. If you want to witness this historic and epic passage, you’ll need to figure out when and where to be and how to get there. I’ve listed road closures on my website here: http://southbaybyjackie.com/space-shuttle-endeavor-departs-lax-october-12-13-2012/. The Redondo Beach Art Group presents their annual art show, IMAGINE. The exhibit runs from October 12 through October 21 and can be viewed at two galleries simultaneously. IMAGINE ART will be displayed at 608 North Gallery and IMAGINE NO BOUNDARIES will be shown at Cannery Row Studios. The opening reception will take place at both galleries on Saturday, October 13 from 7 to 10 p.m. The event is open to the public and everyone is invited to stop by, meet the artists and view the works on display. Cannery Row Studios is located at 604 North Francesca and 608 North Gallery is located next door at 608 North Francesca in Redondo Beach. Exhibit hours are Thursday, Friday and Saturday from noon to 7 p.m. and Sunday from noon to 5 p.m. For more information, visit the websites at http://www.canneryrowstudios.com/ and http://www.608north.com/. Are you ready to put your poker face to the test? The Hermosa Beach Firefighters Association presents the 4th Annual Poker & Casino Night charity event on Saturday, October 13. The fundraiser takes place at American Junkie Restaurant located at 68 Pier Avenue in Hermosa Beach with the action getting under way at 5:30 p.m. The evening features a silent auction along with hors d’oeuvres, music and a no-host bar. Prizes will be raffled off along with additional prizes for the finalists in the poker tournament. A Casino Night ticket (non-poker player) is $45 per person or two for $85. A seat at the poker table costs $95 and its all tax deductible. For more information and ticket purchase, visit the website at www.hbfirefighters.org. It’s time for Octoberfest – a seasonal observance showcasing the miracle of fermented barley, hops, malt and yeast. Celebrate Octoberfest at Terrenea Resort on Saturday, October 13 from 11 a.m. to midnight and Sunday, October 14 from 11 a.m. to 5 p.m. Nelson’s at Terranea celebrates Oktoberfest with a special menu featuring an authentic German spread that includes Munich Sausage Salad, Munich Weiss Wurst, Obazda (a traditional Bavarian cheese spread served with sweet onion rings), Crispy Roasted Pork Shank, Tradition Wiener Schnitzel and Munich-style Sauerbraten. The event will also feature live music on Saturday from 4 to 8 p.m. and Sunday from 1 to 4 p.m. By all means, wear your lederhosen! Terrenea Resort is located at 100 Terranea Way in Rancho Palos Verdes. For more information, visit the website at http://www.terranea.com/events/10132012-oktoberfest-at-nelsons. The Redondo Beach Pier Association presents the 3rd Annual Taste of the Pier on Sunday, October 14 from 12 to 4 p.m. Attendance is free but if you want to sample the fabulous food, tasting tickets are priced at $1 each. Receive one raffle entry to win a prize when you purchase 10 tickets. Each restaurant will feature a different menu item and non-food retailers will offer special discounts. There will be plenty of live music on the stage at the end of the pier over the water as well as free balloons, face painting and arts & crafts at the new SoCal City Kids Zone. The event benefits the Cancer Support Community and the Redondo Beach Educational Foundation. So take a few hours this weekend to stroll the Pier, savor small bites, listen to some live music and maybe spot a few blue whales. The Redondo Beach Pier is located at 100 Fisherman’s Wharf in Redondo Beach. Tickets are available for purchase at the event. For more information, visit the website at http://www.redondopier.com/event/2nd-annual-taste-of-the-pier-2-2/ or send inquiries to info@redondopier.com. This event doesn’t happen until next week but I wanted to give you a heads up. Join millions of people who will drop, cover and hold at 10:18 a.m. on October 18 in the 2012 Great California ShakeOut. Last year more than 12.5 million people were registered in ShakeOut drills worldwide. The Great California ShakeOut is an annual opportunity to practice how to be safer and better prepared before, during and after big earthquakes. The ShakeOut has been organized to encourage individuals, families, communities, schools, businesses and organizations to review and update emergency preparedness plans and supplies and to secure structures in order to prevent damage and injuries. It’s time to get ready. To register, visit the website at http://www.shakeout.org/california/. The South Bay is world-renowned for its miles of delightful beaches and coastline – but did you know there are also hundreds of acres of woodlands, meadows and trails just waiting to be explored? One of the South Bay’s best kept secrets is the surprising amount of natural habitat to be found in the area and it is the mission of the Palos Verdes Peninsula Land Conservancy to “preserve land and restore habitat for the enjoyment and education of all.” They host a full calendar of popular activities, volunteer workdays, training programs and special events throughout the year including: •Nature walks, bird walks, and night hikes on the preserves •Special topic events and workshops •Volunteer workdays on the trails and at the nursery •Trail crew training for outdoor volunteers •Environmental education programs at the White Point Nature Education Center •Family activities at the George F. Canyon Nature Center Since its founding in 1988, the Conservancy has successfully preserved 1,600 acres of open space on the Palos Verdes Peninsula. It’s time to put on your hiking boots and explore the wild side of theSouth Bay. For more information and a full calendar of events, visit the website at http://www.pvplc.org/. As always, check the calendar links and ‘Things to Do’ page on my website, www.southbaybyjackie.com, for details on these and other events throughout the South Bay. On The South Bay Show this morning, we spoke with local hotel and restaurant impresario Michael Zislis He told us all about Rocktoberfest, his joint venture with Gene Simmons and Wolfgang Puck, which takes place all next week at LA LIVE. Don’t worry – if you missed it, you can listen to it here: http://southbaybyjackie.com/october-11-2012-mike-zislis-the-zislis-group-gene-simmons-kiss/. The South Bay Show presents Preparing for Disaster in the South Bay. This very instructive program airs every Friday morning on Blog Talk Radio at 7:00 a.m. Our guest tomorrow morning is Diana Feinberg, Chair of the Beach Cities Joint CERT Organizations Great ShakeOut Drill which takes place in Palos Verdes this year. It will be an interesting and informative hour so tune in! You can listen to it live or at your leisure here: http://southbaybyjackie.com/october-12-2012-diana-feinberg-chair-bcjcos-great-shakeout-drill/. Have a great South Bay weekend! Jackie

George Fotion, HomeIsPalosVerdes.com

Or Find Another Palos Verdes Home

Homes for sale in Palos Verdes Estates Homes for sale in Rolling Hills Estates Homes for sale in Rancho Palos Verdes Homes for sale in Rolling Hills South Redondo Beach homes for sale Hermosa Beach homes for sale Manhattan Beach homes for sale South Torrance homes for sale George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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Five ways to love your home again

If you’ve fallen out of love with your home, and you’re committed to staying put for years to come, it is a worthwhile endeavor to rekindle that romance, and re-excite the spark that makes coming home, being home, maintaining home, and even writing out the checks that keep the lights on, the mortgage paid and the taxes current, a blessing. Here’s how:

1. Spend time in someone else’s home. Make more of an effort than you might otherwise to accept your pals’ barbecue and dinner party invites. Go on those home and garden tours that are put on locally. When you travel, consider renting someone else’s home (or part of it) on a site like Airbnb.com or VRBO.com, rather than just getting a hotel room.  And pay attention to the homes’ locations, comfort level, amenities, decor and nice touches, or lack thereof. Most likely, one of two things will happen: If you love their space, you’ll leave inspired to make tweaks to yours; if you don’t love it, you’ll be super-grateful for your home, just as it is.

2. Get out of your comfort zone and routine. Following the theme of inspiration and gratitude, seek out experiences entirely outside of your comfort zone. The further outside your comfort zone the better. Take a trip to a destination unlike the places you normally vacation; if you live in the city, go stay on a working farm. And if you don’t have time to take a whole trip, just spend a couple of hours in a part of town that you don’t normally go to, or spend an afternoon doing something you’ve never done before: Take a workshop, go for a hike or take a tour. If you drive, take the bus. If you’re always checking your phone, lock it in the trunk of your car for a whole weekend. If you eat out, cook — and vice versa.  When you have experiences that jolt you completely out of your sense of the norm, it resets your brain in a way that allows you to come home and see things that are familiar in a very different light.

3. Inventory and fix any little glitches. It’s easy to get caught up in the day-to-day duties of living and working and raising a family. As time goes on and little things at home break or need repair, many of us fall into the habit of putting them on a list that never gets done. Over time, as the list of doors that creak and handles you have to jiggle grows longer and longer, that can create doldrums and annoyance, as you have to deal with these little glitches on a daily basis and it starts to feel like “broken” is the normal state of affairs at home.  Try taking meticulous care to log and have fixed any and everything that isn’t working exactly as it should. It’s a never-ending battle, mind you; if you keep on living in a home, things will continue to wear out or break, so have a handyman on call to constantly tend to the ongoing list. And every time something is fixed, you’ll be reminded of just how much you love your home.

4. Have a Financial Health Day. Many times, financial hemorrhages and simply feeling like your home is disproportionately draining your bank account can create resentment and anxiety that gets in the way of feeling warm and fuzzy about owning it. Now, every mortgage or home-related financial problem might not be within your power to fix, but rather than letting things spiral without doing anything, the next time you take a personal day off from work, set aside some time to do a deep dive into your home-related financials.  Set an appointment with your mortgage broker to discuss refinancing, if appropriate. Appeal your home’s property tax assessment, if you believe it’s too high. Check to see if recent increases in your home’s value will qualify you to have the private mortgage insurance removed from your mortgage. Figure out what side business or job you can do to pay down your consumer debt or help get you out of the stresses of paycheck-to-paycheck living.

5. Make peace with long-ago compromises. You may have lived in homes for decades and may still have pent-up resentments and anger about compromises made with your spouse or co-buyer during the house hunt. And that’s a terrible way to live, because you spend so much time and money at and on your home — if you feel that way, you essentially live with a major emotional dissonance. This can also create a grave rift in relationships, as the disgruntled party might wield the fact that she acquiesced on such a big item as a weapon of martyrdom or victimhood.

6. This one is from me … When you own a Palos Verdes home, realize you live in one of the most beautiful places in the world … a place where people come to vacation!  The people who built Trump National and Terranea aren’t stupid! 

originally published here: George Fotion, HomeIsPalosVerdes.com

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George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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Why Are More Buyers Canceling Contracts?

RealtorMag reported this week that a high number of buyers are walking away from purchase contracts.  Their article was based on the research done by Capital Economics, an independent research firm.  They found that nearly 18% of all signed contracts were canceled during the three month period of May, June and July of 2012.  The last time that number was so high was back in May of 2010 when the number reached 23% and before the housing slump, the number never exceeded 10%.

So what does that mean for the buyer looking to purchase Palos Verdes real estate or the homeowners looking to sell their Palos Verdes homes?  When digging into the reasons why, two main categories became apparent.  One is psychological and the other is financial.

Let’s study the psychological reason first.  There’s a balance of power that shifts during negotiations between buyer and seller and when the home is actually in escrow.  In a market such as we are now that is grossly undersupplied (refer back to my blog post of a few days ago for Palos Verdes homes supply), in most cases buyers are competing against other buyers for well priced homes.  Often, multiple offers result.  The balance of power is with the seller in this case and Capital Economics stated, “Ironically, the recent pickup in home sales is contributing to rising contract cancellations. As more buyers compete over a limited inventory of for-sale homes*, some are bidding aggressively to get the seller’s attention, but not assessing whether they truly want the house until they’re in contract”.  Now that buyer has won the house and they’re in escrow, then the balance of power shifts to the buyer who may in fact have buyer’s remorse or tend to request concessions from the seller based on the results of the home inspection.  What are some steps you can take as a seller to help yourself during this natural and organic power shift?  These are the three tips I give my sellers of homes in Palos Verdes and the South Bay when I’m interviewing for the job of marketing their home and getting it sold. 

1. This is why pricing your home fairly is so important.  As a seller, you can mitigate this shift of buyer by causing the buyer to understand that they really did get a fair deal and that if they bail on the deal, there will be another buyer ready to take their place (assuming your broker did a good job in the first place of marketing your property). 
2. Get a presale inspection done.  Before you list your home for sale, hire a professional inspector to uncover defects.  Whether you fix them or not, at least having them out in the open (they’re going to get found out about anyway) available to a buyer considering making an offer, creates a level of confidence in you from the buyer that you are trustworthy.  It manages the expectations of the buyer so that you dampen the “buyer’s remorse” feeling we all get no matter what we buy. 
3. Have all your mandatory disclosure forms completed and available for any buyer to review prior to making an offer.  Why wait?  If you wait and turn over disclosures after you go into escrow, you’re just increasing the chances of the buyer using your disclosures as a reason to bail on the deal.  Again, you’re going to have to, in California it’s mandated by law, disclose to the buyer anyway, why put it off?

The second category is financial.  “Tight lending requirements are also contributing to contract cancellations, says Paul Diggle, property economist at Capital Economics. As more buyers move off the sidelines to purchase a home, they’re finding they can’t qualify for a mortgage, he says.”  And what’s worse folks is that the underwriting criteria are changing all the time, often during the course of an escrow.  Nothing is static, everything is fluid.  There’s a mortgage banker that I’ve counted on for over 20 years, Kent Kirkpatrick at American Capital (he’s one of the partners in that firm) who is one of the elite best in getting the job done for my buyers.  When you’re selling your home in Palos Verdes or anywhere around the South Bay, you need to make sure your agent is properly interrogating the buyer’s agent and the buyer’s mortgage banker on the financial bona fides of the buyer.  As a buyer of real estate in Palos Verdes or around the South Bay, you need to understand that the mortgage banker you choose can make the difference between a deal’s life and death.  These folks are definitely not all the same.  What are some of the things you can do and complete upfront before making an offer as a buyer to make sure your loan goes through and as a seller, what do you need to find out about your buyer. 

1. Complete a loan application form
2. Authorize a credit report (are there inaccuracies?)
3. If you are getting your down payment from a relative, is there a properly formatted gift letter
4. Do you own other real estate?  Did you complete a schedule of real estate owned?
5. Getting “PreApproved” is definitely NOT what it used to be
6. Read Kent’s comments below or don’t read them at YOUR peril.  Folks, I’m not kidding, this is the one of the most knowledgeable expert mortgage bankers in the nation**  On a personal note, I thank Kent for taking the time to provide such a detailed analysis of his business and proving once again his strong commitment to doing right by my clients. 

*How limited are listings in the South Bay?  Study this chart and you will see we haven’t seen this low a level of new listing volume in nearly 20 years.  What is this doing to prices?  What does this mean for your own neighborhood and home?  Send me an email or give me call and we can talk about it.  Follow the link in the orange tab below to get access to real estate charts such as these.  Charts are updated weekly and monthly. 

**I hear about these so called “tight lending requirements” and how they are “holding back the purchase market”….  and I am honestly amazed….  Really, tight?  A borrower can buy a $750,000 house with 3.5% down and a credit score of 620…  can get a 3.25% 30 year fixed rate on that…. 3.25% 30 year fixed rate with a tiny down payment, debt to income ratios of 50%… and a questionable credit history to boot….  “TIGHT?”  seriously…. No… it is not… it is still probably a bit loose….  If the government were not backing those FHA loans they would not be out there… no bank would put that program out… not one…. 

I have asked numerous people in the past two years when I am asked about the tight lending standards of banks today to give me an example….  Most cannot come up with a plausible example of where a borrower should have obtained financing and didn’t….. those that do site a borrower who has a large amount of equity, excellent credit history and great cash reserves but lack a solid  or consistent income….  just because you have the first three does not mean you qualify for new debt….  If you rely on equity or existing cash reserves to make payments (on some occasions this can make sense) it does not mean the new loan will be repaid the same as those with solid cash flow from a consistent income… all too often in the past five years we have seen instances where borrowers had the first three and chose to walk away from the new debt rather than liquidate their equity, cash reserves etc…..   it does make sense that in the overall picture, a borrower should have the cash flow to pay for a debt…. That is good lending, sound principal…  it can also make sense that in a case by case basis a lender who specializes in loans not sold to the large government agencies like fannie mae and freddie mac, to step into this area and make these loans to solid borrowers who don’t fit the norm….  it does not make sense for large government agencies to do these as we have seen from the past…. They should focus on exactly the type of lending they are doing today….

Another example that comes up when I ask why they think lending is tight is that their client was just declined for a loan by a bank.  Once we delve into why, the normal problems fall into two categories….  First, the loan officer made the critical mistake of not doing the upfront interview with the client properly…. This is THE most important part of lending… period.  The first five minute conversation with the borrower should be the loan officer asking a myriad of questions from “tell me about what you are trying to accomplish with this purchase or this refinance” to then asking detailed, and I mean VERY detailed, questions regarding the borrowers personal finances….  If this is done properly, it will eliminate 99% of any problems that can come up in the approval/funding process.  This then takes us to the next most important part, which as I write this, I am wondering if I should have made this the number one part….

Choosing the right lender to do your loan….  this is critical as well…. ( and I will disclose who I am….  I own a 19 year old mortgage bank that survived the last ten years after struggling by not doing subprime loans ( which made no credit sense ) that all other mortgage banks did and then watching most normal financing disappear for three years in the resulting financial meltdown)….  it is my belief that most borrowers, wrongly influenced by the media and the government, believe it is in their best interest to go directly to a bank for a home loan.  This could not be farther from the truth.  Banks have one set of products, guidelines and goals….  They take only the types of loans and borrowers that fit their needs…. Mortgage bankers have multiple funding options and goals….  The most important goal is to match a borrowers needs to a funding source and do it in an efficient, compliant, honest and straightforward manner.  Mortgage bankers have better pricing, better operational efficiency and a much larger product diversity to deliver a wider range of options to the client.  While one bank says it will only do loans to 90% loan to value, another might allow 95%… if the borrower apply’ s at the first bank, they may never know that they had an option at 95%…. they may just walk away and say “lending these days is just too tight”….  There are thousands, yes, thousands of examples that are similar to this first one….  the other day a client was referred to me after getting turned down at Wells Fargo…  the issue was the debt to income ratio for the borrower was over 41%… industry standard is 45%… we can even go up to 50% with compensating factors like good credit, strong job stability etc… but Wells Fargo has so much business that they have decided they only want the BEST loans… with lower debt ratios…  this client had perfect credit, 22 years as a teacher, 15 years as a police officer ( husband) and great cash reserves while putting down 10% on the home…  we funded that loan in 9 days at a 3.375% no point 30 year fixed rate.

The third most important part….  LISTEN TO YOUR REAL ESTATE AGENT REGARDING THEIR MORTGAGE REFFERAL….  They know… they do this all day, year, career long…. They are not going to refer you to someone who they don’t trust….  They refer you to who gets the best combination of product, price and service…. Period…

Fourth most important….  Once you have chosen a lender… trust them… trust that your upfront research and conversations have led you to a funding source that is the right one… and then listen to them and let them lead you through the process.

Fifth, expect that numerous times during the process you are going to say “seriously?, you really need that as well?…  I have given you so much already and you just keep asking for more?”    this is the way it is today… to get these great rates, they put you through the ringer and back… every I dotted, every T crossed… and then they want more….

There is so much that goes into mortgage lending… so much is changing… it is the mortgage professionals job to set the right expectation with the client and make sure to follow through on that….  that is what I do.

Kent C. Kirkpatrick, Principal
2121 Rosecrans Avenue, 6th Floor
El Segundo, CA 90245
(310) 640-0100 Fax (310) 524 0336
Cell (310) 283-8662

George Fotion, HomeIsPalosVerdes.com

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George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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Palos Verdes Estates Homes on RealEstate.com

Marketing property in today’s market is all about getting your Palos Verdes home exposed to motivated buyers on the internet.  Realtor.com reports that nearly 90% of all buyers go to the internet to find their next home.  Most often, it’s the Buyer telling their agent, “…Hey I found this home on the internet, can you show it to me…”  So to get top dollar, to sell in an efficient period of time, you need to get your home seen and you need lots of internet portals where your home will be seen.  Being an exclusive agent with RealEstate.com for homes in Palos Verdes means your home gets the added exposure it needs to sell at its highest market price. 

Visit this site to start your search on RealEstate.com and also use the website below for other feature rich content to help you become a more powerful and knowledgeable owner, buyer and/or seller of real estate in Palos Verdes and the surrounding South Bay

This blog post was originally published here: George Fotion, HomeIsPalosVerdes.com

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George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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Palos Verdes Homes or Palos Verdes Condo/Townhomes?

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The old saying in real estate is that for the same price you usually are better off buying the Single Family Residence than the Townhome in the same area.  Sure, the SFR may not be as nice of condition and need work or perhaps it’s older, BUT … you can clearly see that when the market was rough, condos and townhomes fell by a greater percentage than did the single family residences.  And, as the market recovers, what type of property is appreciating at a faster rate? 

Yet, I do understand that there are still strong compelling reasons why folks opt for the townhome or the condo.  For example, sometimes there aren’t any homes available at the lower price point offered by the condo in the same location and you, for example, really want to be in the Palos Verdes school system.  That’s a perfectly understandable and valid reason.

All I’m saying is that if you can, stretch to get that Single Family Residence.  Your protecting your dollars better and giving them a better chance to grow!

As originally published here: George Fotion, HomeIsPalosVerdes.com

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George Fotion Call Realty Company (310) 346-6467 gfotion@emailtreo.com

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