Los Angeles Westside Real Estate by Clara Yang

$100 Million California Tax Credit Will Go Fast...

noreply@blogger.com (Clara Yang) — Tue, 11 May 2010 17:18:00 +0000

The $100 million allocated for California's first-time homebuyer tax credits may be depleted in about 10 to 20 days or sooner, according to C.A.R.'s Economics team. California's Franchise Tax Board (FTB) plans to begin accepting applications on May 1, 2010 for tax credits up to $10,000 for first-time homebuyers and for homes that have never been previously occupied. However, the total tax credit allocation for all taxpayers is $100 million for first-time homebuyers and $100 million for new homes, both on a first-come, first-served basis.

C.A.R.'s forecast of 10 to 20 days to deplete the $100 million allocation for first-time home buyers is based on estimated May sales figures and other parameters. It does not take into account the possibility that buyers scheduled to close escrow in April may delay closing until May to take advantage of the tax credit. If a shift in closings from April to May occurs, the first-time homebuyer tax credits may be depleted even more quickly than indicated above.

Applications for the California tax credit must be faxed to the FTB after escrow closes. The FTB will update its website when the 2010 application form and other information become available.

Realtors are reminded not to give their clients any tax or legal advice, such as the availability of funds under the California tax credit program. Agents should encourage their clients to seek specific advice from an accountant, attorney, or other professional as they deem appropriate.

For more information, please refer to

C.A.R.'s Homebuyer Tax Credit Chart 2010

2010 Tax Credit for New Home / First-Time Buyer

FTB Offers Guidance on Home Buyer Tax Credits

Why Buy Shimao?

noreply@blogger.com (Clara Yang) — Thu, 06 May 2010 16:40:00 +0000

1. Size. It’s the largest privately owned developer in China. The number 1 and 2 companies are owned by the government. It has been around for 25 years and at the end of 2003, it opened to the US market to establish its international branding.

2. Strength. Shimao is listed on the Hong Kong stock exchange stock #00813, with HK$600 billion in assets, which is its parent company. All financial statements and operations are very transparent. The profit margin is less than 20%, but it’s still higher than all its competitors. It’s also listed on the Shanghai stock exchange as stock #00823; with RMB 200 billion in assets.

3. Hospitality. Shimao is the second largest developer in the hotel business, number 1 is owner of Hotel Shangrila. Shimao has over 30 five-stars hotels being built right now.

4. Luxury. Shimao is famous for building high-end estates. Its founder is from Fukin, and lives at the top of the Peak area in Hong Kong. The estate is one of the most expansive in the city. Bought for HK$ 21 billion, it’s now worth about HK$ 41 billion. Shimao is also developing a very limited number of extreme high-end estates in the Peak area.

5. Integrated Planning. Shimao’s top business focus is always on the residential real estate market. In order to enhance and protect its real estate value, Shimao is building department stores and theaters as part of its developments.

6. Influence. Shimao’s most recent project is the largest real estate project in DaLian— the Carnival project. It will be the largest development invested in by the Shimao group, with total investment estimated to reach RMB 50 billion. The plan includes an outdoor theme park, and an ultra large indoor theme park covering about 17 million square meters.

7. Availability. Shimao has five projects in five different cities projects with units for sale to U.S. buyers.

Shanghai’s One Shimao Riviera Garden— Ranked as China’s highest-altitude residence by the Guinness Book of World Records. Seven super-high buildings were built along the river, surrounded by forests in the back and rivers in the front.

A top-floor unit was selling at around US$ 600,000 few years ago, but now the price point has reached US$ 3.5 million, costing about RMB 10,000 per square meter. Prices are expected to go higher next year as Sun Hung Ki—another Hong Kong developer—is going to finish and begin selling their adjacent development at RMB 20,000 per square meter. By comparison, Shimao Riviera Garden has a much better view and location.

Hangzhou Shimao Riviera Garden— Located in the last residential development that can view the lake. The first phase was sold out at RMB 7,000 per square meter a couple of years ago, while the phase two is selling at an average of RMB 20,000 per square meter, setting the cost of a 250 square meter unit at around US$ 800,000.

Kunshan Shimao Butterfly Bay— This development consists of over 6,000 townhouses, villas and apartments. Kunshan is an industrial city that is situated about a 30 minute drive from Hongqiao Airport in Shanghai. An express train is being built that will take passengers from Shanghai to Kunshan in just 15 minutes. Kunshan’s strategic location and convenient transportation between major cities makes it a prime candidate for strong future growth. Due to its close proximity to Shanghai, Kunshan is often referred to as "The Tenth Town of Shanghai". Kunshan is also sometimes referred to as "Small Taiwan" as over 600,000 Taiwanese citizens reside or work in that city every day. Many of these Taiwan residents are successful business people who own factories and wholesale businesses in Kunshan. This industrial powerhouse city also boasts factories for 100 of the Top 500 businesses in the world.

The community was selling its last phase at RMB 5,000 per square meter, but it’s now rising to RMB 11,000 per square meter. The smallest unit is about 92 meters square (about 990 sq. f.t), costing about US$144,000.

Yantai’s Shimao No.1 the Harbour— Located at the seafront square in the downtown area of Yantai City, Yantai Shimao No.1 The Harbour enjoys an excellent location, standing against the hills and facing the sea. With a land area of 34,700 square meters and an aggregate floor area of 280,000 square meters, the project comprises three 54- to 59-floor towers for businesss and apartments, and a 57-floor, 323-meter tower for integrated use. The project is planned to be the highest landmark seashore architectural development in Yantai and the Jiaozhou Peninsula, consisting of super five star hotels, full sea-view high-end apartments, plus buildings for retail businesses and offices.

Currently the company is selling the high rise condos with the best views, sized from 76 to 280 meters square, at US$ 140,000 to US$ 550,000.

There is also a limited amount of commercial space ranging from 16 to 98 square meters, priced from US$ 68,000 to US$ 358,000. Commercial spaces are all located inside of Shimao Shopping Mall, to be rented out by the landlord with an average return of 8% per year for the next 10 years.

Xiamen’s Shimao Lakeside Garden— Xiamen is a clean and beautiful island, just a ferry ride away from Taiwan. Visiting Xiamen for the first time a few weeks ago, it reminded me of a very quiet island in Hawaii. And with amazingly tasty seafood!

The new Shimao construction will finish at the end of 2012, with the average price from RMB 20,000 to RMB 40,000 per square meter. The site is on the east side of a very large preserved lake, with enough clear, drinkable water to supply the whole island for one month. As it’s a preserved lake, it’s closed to in-water recreational use, and its shores are lushly landscaped. A jogging trail is to be built surrounding the lake, and markets, restaurants and bars will be setting up between the Shimao lakeside garden and the trail. There will 6 villa buildings and 13 high rises, all with different heights and elevations to maximize the view from each unit.

Shimao has always chosen units with the best view and best location to be sold in the U.S.. This time there will only be 15 units available for sale on May 15-16 in LA, sized from 147 to 245 square meters, costing from US$ 440,000 to US$ 800,000. . . . . . .

If these descriptions have piqued your interest and you’d like more information, check out www.shimaousa.com ... Or contact me at 1-310-259-1525.

I will be at the Shimao Sales Convention on May 15-16, from 10am-5pm, at the Hilton Pasadena Hotel, Pasadena, CA.

See you there!

—Clara

Hong Kong and China Real Estate

noreply@blogger.com (Clara Yang) — Tue, 04 May 2010 19:39:00 +0000

It’s always great to go back to one of my homeland, Hong Kong. The city is always buzzing, people are quite happy these days with their highly appreciated value of real estate. People always compare the high real estate price of Hong Kong and Manhattan and I think Hong Kong has been surpassing many metropolitan cities regarding annual real estate appreciation.

As we know Hong Kong is an island with almost 7 million people and always crowded with tourist/visitors especially from Mainland china. Average prices of real estate has risen at least 30% since a year ago and average price ranges from US $1000 to$1800 per square feet. These are the prices for high rise condominiums which aren’t even brand new. For the really high end estate, prices range from $3000 to $5000 per square feet. Hong Kong luxury home prices jumped 45% last year.

You might be wondering: who are the super rich buying up and supporting such a crazy market? In recent years, many multi millionaires are created in Mainland China and they can travel to Hong Kong freely to purchase properties and gain citizenship in Hong Kong. The Mainlanders has been the reason in supporting booming real estates in Hong Kong and all major metropolitan cities within Mainland itself. They either bought up all these units as their second home or just plainly kept it for future appreciation. Many buyers form groups to visit Hong Kong to purchase new construction and they each purchase 3-5 units at a time in one day.

Booming Market in China and Shimao

noreply@blogger.com (Clara Yang) — Tue, 04 May 2010 17:04:00 +0000

Mainland China‘s real estate has been rising at 11.7% for its major 70 cities since last year. China’s government unleashed a $1.4 trillion lending boom last year to stimulate the economy and is now trying to slow the surge in property prices. Hainan is top on the list with price rising over 50% in one year. The growth rate is sliding, but prices may continue to rise until the demand supply imbalance improves.

Developers had deferred construction of new projects till the fourth quarter of last year due to the global financial crisis. But with the quick financial recovery and the realty market sizzling, it led to a demand-supply imbalance and resulted in sharp price hikes. In order to curb excessive property price growth in some cities, government has launched new rules that investors have to put down extra 10-20% as down payment when they are purchasing their second or third properties. It did cause 10% cancellation in existing contracts, prices are not rising sharply and not falling either. It is expected to correct 10-15% in short term, making this a great buying opportunity.

I have the honor to be invited by Shimao (top #3 as Chinese Real Estate Luxury home developer) to be one of their agents to represent some of the best investments in China.

Since 2003, they had the vision to establish their international branding and they started team up with agents all over the world to sell the highest demanded unit in their selected projects. They are famous for building high end properties along the ocean, lake or water reservoir. They reserved the best viewed units to our U.S. market regardless local Mainlander line up to purchase these new constructions in China. The U.S. buyers really love the fact that there is no property tax in China and also the Homeowner’s monthly maintenance dues is very inexpensive even for brand new full service buildings.

Why invest in China?

1. 13 billions of population, with GPA rising in 8% per year. - If China creates one million per 0.001%, how much more buying power per year? Amazingly high. No more land to be purchased to build new development. There are lots of land in china, but most has to be kept as farmland to produce rice for local Chinese. In auction for land, government is listing land in the price based on rising home price 10-15% per year, money has to all paid off within one year and building has to start within 2 years.

2. Rising RMB - most probably will happen this June

3. Government is trying to control rising real estate prices. - Everytime they did, for the last three times, prices gone up more than before within a year.

What's Selling in 2010 in Los Angeles?

noreply@blogger.com (Clara Yang) — Mon, 12 Apr 2010 21:31:00 +0000

Single Family Properties are "HOT" and Selling this spring in multiple cities across the Los Angeles Area.

Here are a few examples to give you a glimpse of what is happening in our market:

Beverly Hills:

25 homes have sold during the first quarter so far. 1 sold over the asking price. 3 sold's were priced over $10,000,000

450 N. Doheny Drive - Listed $11,900,000 and sold for $10,000,000

1141 Summit Drive - Listed at $21,000,000 and sold for $16,500,000

Brentwood:

46 houses have sold since January of this year. 8 of them sold over the asking price and at least 6 of them sold very close to asking. We are not just talking about entry level houses being sold either. The one's that sold over asking are the higher priced range ones!

474 Homewood Road - Listed at $3,300,000 and sold for $3,525,000

700 N. Bundy Drive - Listed at $2,495,000 and sold for $2,809,000

Cheviot Hills:

12 listings sold. 3 of them sold over the asking price.

2821 Dumfries Road - Listed at $1,795,000 and sold for $1,940,000

3043 Cavendish Drive - Listed at $1,199,000 and sold for $1,200,000

Mar Vista:

39 homes sold. 9 sold over the asking price and many sold for asking.

3967 Marcasel Avenue - Listed at $649,000 and sold for $675,000

3114 Greenfield Avenue - Listed for $1,249,000 and sold for $1,260,000

Santa Monica:

37 homes have sold since January 2010. 2 of them sold over the asking price and 2 sold for asking.

2413 30th Street - Listed at $999,000 and sold for $1,075,000

933 Harvard Street - Listed at $1,849,000 and sold for asking price.

Pacific Palisades:

58 homes have sold since January 2010. 2 of them sold over the asking price and many sold very close to asking.

801 Amalfi Drive - Listed at $8,495,000 and sold for $8,000,000

15242 Friends Street - Listed at $1,595,000 and sold for $1,625,000

Westwood:

15 listings sold. 6 of them sold over the asking price.

941 Hilts Avenue - Listed at $2,495,000 and sold for $2,550,000

10762 Wellworth Avenue - Listed at $1,395,000 and sold for $1,400,000

1236 Holmby Avenue - Listed at $1,249,000 and sold for $1,305,000

All About Income Property

noreply@blogger.com (Bob West) — Thu, 17 Dec 2009 21:30:00 +0000

Why buy income property?

The primary reason for investing is the investment's potential to return income above its cost. This income can be in the form of interest, dividends, or rents and profits realized from appreciation in value when the investment is sold.

A vast number of investment opportunities fit this definition. The interest earned can be fixed or
variable, high or low, appealing to investors who want safe and conventional investments, or to those seeking greater returns at higher risks. Investments are acquired for their profit potential, even though some also may have practical, artistic, or other value to the investor. The type of investment, in turn, can affect the amount and type of income earned.

An investment is considered successful only when the investor's goals and objectives are met. A satisfactory level of income or profit to one investor may be unacceptable to another. In general, there are three types of investors: individual (single persons or small businesses), corporate (public or private corporations), and institutional (pension funds, insurance companies or real estate trusts, known as REITS).

Property Type/Asset Class

Analyzing and comparing real estate investments involves identifying the property type. Real estate investments can be categorized according to the property's use, such as retail, office, industrial, or residential.

Retail properties are used to display and sell goods and services to the public.
Office properties are used to house management and staff operations.
Industrial properties house manufacturing, distribution, or warehousing operations and also may include some office and storage space.
Residential properties house one or more family units.
Other properties include raw land, hotels, hospitals, recreational facilities, restaurants,
movie theaters, and properties for other special uses.

What has been selling?

Hotels

Even though more than 300 hotels were in foreclosure or default on their loans as of Sept 30, 2009, a prime location can still sell a hotel property at a great price:

Hotel Angeleno (the former Holiday Inn right next to the 405 Fwy, Sunset Blvd exit), is a Joie de Vivre boutique hotel with 209 regular guest rooms and 3 penthouse suites. Sold for approximately $43.5M in September of this year, about $200k per room, with their average rate at $120 per night. You might think that it will take a long time for this to become a positive cash flow property, but depending on how you structure the financing on the purchase and how innovative you can be in improving the revenue of the operation, it could be a winner.

Some of the better deals of the year in hotels:

W hotel on 3rd Street, San Francisco, 10 years old building with 404 guest rooms, sold for almost $88M in July 2009, about $217k per guest room, I think this was a great deal.
Carmel Valley Ranch owned by Blackstone was sold for $20M for its 400 lush acres and 144 guest rooms at June 2009.
Holiday Inn Laguna Hills, built at 1973, sold for $11.85M for its 147 guest rooms in June of 2009.
The Fairmont Miramar Hotel on Ocean Ave, Santa Monica -- luxury hotel and bungalows -- sold for $210M, almost $700k per guest room. Yes, the price had come down a lot since the day Fairmont Miramar hotel changed hands three years ago. Photos:

Prime location still sells for top dollar and I do think Hotel Angeleno received a great price for its location.

Since I'm a world traveler, all my close friends know that one of my favorite hotels in the world is Villa D'este at Lake Como, Italy. It would be a dream come true to own it one day.

Retail

With many for lease signs posted on empty properties on Montana Ave and in the Palisades village, it's obvious the economic downturn has caused many businesses to close their doors. New business tenants should now sign a longer lease term to lock in a substantially discounted rental rate.

Some notable retail properties sold this year:

Hugo Boss on 414 N. Rodeo Drive, Beverly Hills -- This 11,078 sq. ft. free-standing retail building was sold for $28M at August 2009, costing about $2,527 per sq. ft..

The former Toys R Us on 402 Santa Monica Blvd, in Santa Monica (currently occupied by REI) was sold for $31.7M in September of 2009. The space comprises about 52,250 sq. ft. Photo:

Residential Multiple-Unit properties sold this year

Several prime properties were sold for top prices around Ocean Avenue in Santa Monica, in spite of the market meltdown:

130 San Vicente Blvd. -- This property sold for $12.6M for the lot size of 41,000 sq. ft. Renovation work is being done right now to the property. Photo:

901 Ocean Ave. -- A 28-unit building with a breathtaking ocean view was delivered empty for the new owner to re-build; sold for approximately $10M. Photo:

937 16th Street -- Great owner/user investment with 3 units -- one of which is a three-bedroom -- sold for $1.52M with a GRM of 15.30. GRM is the Sold Price divided by total gross rental amount per year. Santa Monica, Venice and Marina del Rey usually command a much higher GRM, as tenants always desire coastal properties in Southern California, an area with excellent weather, and very high quality of life. Photo:

908 15th Street -- With 6 large units and 9,442 sq ft of living area, this property sold for $2,550,000 or a GRM of 14.3. Photo:

2027 Euclid Street, Santa Monica -- This 8-unit building, with 5,616 sq. ft. of living area, sold for $1,265,000 -- a GRM of 15.3

When is a good time to buy?

Here is a roundup of recent news on Commercial Real Estate:

"Overall transaction activity for all commercial property types in the first half of 2009 slumped to $16 billion, down a whopping 80 percent from $79.8 billion in the first half of 2008, and down 93 percent from $231.4 billion in the first half of 2007, when the market was at its peak, according to Jones Lang LaSalle's U.S. Mid-Year Capital Markets bulletin." -- MultiHousingNews.com

"The distress is still in its early stages, analysts said. 'We are between the first and second inning,' said Richard Parkus, who directs research on commercial mortgage-backed securities for Deutsche Bank. 'We're going to have to get through a very difficult period.' ... Building values have declined by as much as 50 percent around the country, and even more in Manhattan, where prices soared the highest. As many as 65 percent of commercial mortgages maturing over the next few years are unlikely to qualify for refinancing because of the drop in values and new stricter underwriting standards, he said." -- NewYorkTimes.com

To prevent more commercial loans going into default, government assistance and loan modification will be necessary. But as investors, this could be a once-in-a lifetime opportunity to own prime investment at a deep discounted price.

I urge all my friends and clients to wait for deals to come around and act on them when they do.

What can we buy right now?

For me, as an investor, location is the most important factor in choosing property. After that, the numbers have to make sense--meaning the return on my money invested should yield a much better return compared to other investment choices currently presented to me.

Here are some other questions, among many others, I have to answer:

If I am hiring a property management company to maintain the building and collect the rent -- paying between 7-10% of my rental income -- would the return be diminished too much? Would the potential cash-on-cash return be enough for me to take the risk?
Would the property need major renovation in the coming years, like a new roof?
If there is no appreciation in property value in the very near future, would I be okay with it?

For income properties, potential buyers aren't usually allowed to examine the units until there is an accepted offer. So for the first round of selection, a decision largely depends on the location and the rental income information provided by the sellers.

Some of the better deals in Residential Multiple-Unit properties available right now:

908 4th Street -- This is a prime location in Santa Monica, four blocks from the ocean, North of Wilshire, and a few blocks from the 3rd Street Promenade. Total gross rent for this 18-unit building is $226,836 per year, with a GRM of 14.48, if you were to buy it at the listing price of $3,285,000.

The biggest pluses for owning the building: it is not a rent-controlled property, and the building was renovated in 1993. For a great location like this, vacancy will be quite low as long as the building is well maintained. The living space is very small, with the 18 small studio apartments totaling 7,497 sq. ft., so if a unit is vacant, it will only cost $1,000 per month in negative rental income. Note that a cash-on-cash return can be calculated, but a building's expenses are generally not disclosed until escrow, often making it difficult to do the calculation for now.

133 N. Almont Drive, Beverly Hills -- This is in a prime Beverly Hills area, between Santa Monica and Wilshire Blvd., next to the Golden Triangle. It has 19 units with a total of 11,522 sq. ft. The majority of the units have also been renovated, and the total gross rent is $433,680--a GRM of 14.90 after paying the asking price of $6,495,000. This building is substantially larger, with a lot size of about 26,000 sq. ft., and the units are mainly 2 bedrooms.

How do you choose?

Finding the right properties to invest in is obviously most crucial for long-term and sustained guaranteed success in real estate investing.

Summary of Investor Preferences

Each investor is unique in their preference of asset class, geographic location and risk tolerance. Some might prefer an apartment building in Santa Monica with 30 tenants so the risk of losing large sums of monthly rental income is quite low. Some might prefer a shopping center in Playa del Rey with one major tenant like Target. If all but one of the following financial components of the investment are the same, most investors will follow some common preferences when evaluating investment alternatives.

Assuming all other investment characteristics are the same, investors prefer:

Larger periodic cash flows -- Fixed monthly rental income and rent based on a percentage of tenants' monthly revenues.
Larger sales proceeds -- After appreciation of the property over time, this is what what investors hope to pocket after paying off mortgage balances, the cost of sale and taxes.
Lower initial investment -- This depends how much loan the investor is approved for. The more leverage, the higher the rate of return.
Earlier periodic cash flows -- As investors, we want to be paid sooner and not later. Up-front rental payments, even if discounted, can create a capital fund the investor can channel to new investments.
Easy renovation -- to add value and improve cash flow.

When purchasing income property, there are so many options between asset classes and location. What makes sense to one investor can be dramatically different from what seems logical to another. Financial analysis is always one of the most important steps in making the commitment. The most important added value I provide to my investors truly is the experience I have gained in purchasing my own properties, and -- after accurate financial information is provided -- my ability to calculate and project the rate of return among all their options.

Buyers I work with can make an educated and well-informed decision that fits their expectations. Much new wealth was created during the last economic downturn. I think big opportunities for acquiring quality income properties at a discount price are here now.

Contact me if you are interested in learning about investing in income property, or if you would like me to provide a financial analysis of your portfolio holdings.

The weather is cooling down but the real estate market is heating up.

noreply@blogger.com (Bob West) — Thu, 29 Oct 2009 23:00:00 +0000

Existing home sales in the U.S. rose 9.4% in September of 2009, due to low interest rates and the $8,000 tax credit for first time home buyers. As for the Westside, I think the main reason for the increase in purchasing power is the overall improvement in stock portfolio performance, and buyers feeling that we are at or near the bottom of the economic downturn. The Dow Jones Industrial Index has risen roughly 50% since March, closing above 10,000 for the first time in over a year. For many Westsiders, the main source of income for closing escrow comes from liquidating positions in an investment portfolio.

So has our real estate market bottomed out?

This is the question I get almost every day from overseas buyers and local residents. From what I’m seeing, our Westside market is super hot. All of my listings have been selling in multiple-offer situations. Successful sellers align themselves with current market conditions, knowing they probably won’t be able to sell their homes for the high price of few years ago, and buyers know that interest rates aren’t going to get lower than those in effect right now.

Let’s see how the Westside markets performed during September through the beginning of October:

Santa Monica: Condos

From September 1 to October 15, 2009, 47 properties out of 153 active listings went into escrow, with an average Days On Market (DOM) of 76 days. Total Sold in the time frame is 44 homes, with an average sold price of $748,000.

Brentwood: Condos

From September 1 to October 15, 2009, 21 out of 72 listings went into escrow, with an average DOM of 74 days. Total Sold in the time frame is 24 condos, with an average sold price of $720,000.

Brentwood: Houses

From September 1 to October 15, 2009, 37 out of 135 active listings went into escrow, with an average DOM of 101 days. Total Sold in the time frame is 34 homes, with an average sold price of $2,700,000. Six of them sold for close to asking or above asking price.

Pacific Palisades: Houses

From September 1 to October 15, 2009, 14 out of 165 active listings went into escrow, with an average DOM of 99 days. Total Sold in the time frame is 22 homes, with an average sold price of $1,900,000. Eight of the homes sold for close to asking or above asking. A very strong market indeed.

Malibu: Houses

From September 1 to October 15, 2009, 6 out of 265 active listings went into escrow, with an average DOM of 97 days. Total Sold in the time frame is 12 homes, with an average price of about $3,200,000. A couple of them sold very close to the asking price.

Beverly Hills: Houses

From September 1 to October 15, 2009, 13 out of 125 active listings went into escrow, with an average DOM of 112 days. Total Sold in the time frame is 14 homes, with an average price of about $4,900,000. Four of them sold way above asking price. (See below for more details.)

Santa Monica: Houses

From September 1 to October 15, 2009, 15 out of 95 active listings went into escrow, with an average DOM of 53 days. Total Sold in the time frame is 37 homes, with an average price of about $1,900,000. Seven of them sold for close to asking or above.

Mar Vista: Houses

From September 1 to October 15, 2009, 20 out of 58 active listings went into escrow, with an average DOM of 45 days. Total Sold in the time frame is 38 homes, with an average price of about $777,000. Eleven of them sold for close to asking or above.

Clara's Note: The market has been very strong since August. Properties are selling when they are priced right. Many properties after listed for months with no action, sold immediately after the price was reduced to the right amount. This is true for all price ranges in the Westside.

Beverly hills has been very busy with over-bidding:

1076 N. Hillcrest Road listed for $2,800,000. This four bedroom fixer on a 23.8k sq. ft. lot sold for $2,900,000.

808 N. Camden Drive listed for $3,195,000. A five bedroom, Mediterranean estate located on the flat, this house sold for $3,471,000.

1024 Summit Drive listed for $6,950,000. This mid-century modern home located next to the Benedict Canyon sold for $7,150,000.

In Brentwood Park, 200 N. Cliffwood Ave. listed for $5,795,000, and sold for $5,800,000 — priced at the value of the lot alone.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Where are the Real Estate Bargains?

Everyone has different definition of “good deal” and “bargain.” As for me, I don’t care to buy a home in an inferior location just because it is at a low price. I have seen people buying a “good deal” home and then spending hours each day commuting to work. That is not my definition of “quality living”. I believe in having it all, now and in the future. We can choose to live in the neighborhood we love, and at the same time, make it the best investment of our lives. It’s achievable. The greatest joy in my work is to advise and assist my clients to achieve just that.

As I said in my previous post and newsletter, every house on every street is unique in its way. Part of my expertise is to match the house to my client’s lifestyle and investment objectives. If you are interested in taking advantage of the current market conditions, call or email me to set up a consultation.

Aiming High

On Sept 23, 2009, the Wall Street Journal published an article headlined “Seeking Real Estate Bargains? Try looking at the High End.”

“While the latest data suggests prices for mainstream homes may be stabilizing after several years of pain, the news for luxury homes isn’t looking as good.”

It is quite true that many multi-million dollar houses can stay on the market for a long time unless they are priced right to sell. The fact that they can be bought immediately illustrates the resilience of our local real estate market. I personally live and invest in the Westside market, and I definitely agree that there are great bargains in our high end market right now.

Among all the quality bargains, here are few of my favorites:

120 S. Burlingame Ave, in Brentwood Park — Listed for $7,995,000

A Mediterranean Villa newly built in 2009, this house has 8 bedrooms, and 12,000 sq. ft. of space on a half-acre lot. This home cost about $12 million a few years ago. Just the lot value in Brentwood Park is around $6 million.

1805 Melhil Way—Listed for $9,995,000 and sold for $9,100,000

This is a one-of-a-kind, exquisite brand new Hacienda house on a 3 acre private knoll on top of Sullivan Canyon. Many of my clients like to build a house on top of a hill, and there are not that many hilltop sites that are close to the city. This is about 5 minutes north of Sunset. Living here is truly like being on top of the world— like owning your private resort. Interesting fact: this land was purchased for about $1.1 million in August of 1998 through probate sale.

The recent uptick in buyer interest, coupled with growing consumer confidence indicates that the Westside always will be a highly desirable place to live. The bottom line: At the high end, it’s a good time to be shopping for that dream home.

Field trip

With the many properties that I have owned and my many years of experience in the real estate field, I have come to love beautiful homes and quality construction. Even when I am on vacation, my favorite pastime is to look at high end homes.

I was in New York in September and had the lovely experience of visiting one of Manhattan’s most legendary buildings, the Plaza Hotel. The Plaza, which has had many distinguished guests in its 100+ year history (even The Beatles), closed in 2005 to undergo a major renovation that resulted in hotel and condominium accommodations. The highest priced residence condominium sold for over $50 million.

Mainly due to last October’s stock market crash, many property owners in Manhattan have had to sell or lease out their vacation homes in the Plaza. Both the sales prices and the rental prices have been taking at least a 20% hit from a couple years ago. One of my favorite units is located on the 14th Floor: a one bedroom of about 1200 sq. ft., with expansive views of Central Park, listing at $6,750,000. If it is for rent, the price will be about $12,000 per month. Another unit on the 4th Floor, a 2 bedroom facing the Apple Store on Fifth Ave., is selling for $8.5 million, although I was informed that it could be negotiated to $5-6 million. This storied building is equipped with all the luxury amenities, and includes walking proximity to Central Park and 5th Avenue shopping and entertainment.

For the high end condo with the best view—among all the people I talked to in New York—the award goes to:

The Luxury Condominiums at the Mandarin Oriental, located in Manhattan’s Time Warner Center.

The hotel group consists of 248 guestrooms / suites, and provides services for its 64 ultra luxury residents, all of which have views of Central Park, the Hudson River and the New York City skyline.

The average price per square foot of a Mandarin condo is $2,800, about quadruple the Manhattan average. There are 66 residences in all, which start at $3.6 million, on the "low end," a 1,100-square-foot apartment went for a stunning $4.6 million. On the “high end”, the penthouse unit went for $63 million (for about 16,000 sq.ft) selling for almost $4,000 per square foot.

So what exactly do you get for your $2,800 to $4,000 per square foot? A few highlights:

It's a lifestyle choice. You can call ahead and have the fridge stocked from Whole Foods, have your bed turned down and have chilled champagne waiting for you.
It's private living, with the option of room service, or somebody who can find you Broadway tickets. In addition, there's the French/Japanese restaurant Asiate, and the hotel staff can cater a party in your apartment.
If you want to branch out, there are all the shops and restaurants within the Time Warner Center, which will include a Whole Foods market, Equinox gym, and a new restaurant by French Laundry chef Thomas Keller.
Each floor is accessed by private elevator, with a fingerprint touch pad, and the apartments are so high-tech that residents could use a room as a recording studio or have teleconferences from their bed.

As an international properties specialist, it is my passion to pick out the “bargains” among the high end properties in any metropolitan city. If you are interested in receiving more information, please contact me for details.

What is really selling in our local market?

noreply@blogger.com (Bob West) — Mon, 14 Sep 2009 23:00:00 +0000

After months of grim news of lower median home sale prices and growing foreclosure rates, Los Angeles Times reported recently that the market may actually have hit bottom, and the “housing index hints at upturn.”

What does this mean for our local market?

Here is my analysis of some recent transactions in our area:

Santa Monica: Condos

Second Quarter of 2009, there were 103 sold listings, with average Days On Market (DOM) of 56 days, and an average price per sq. ft. of $584.
Comparing the same time frame of 2006, there were 136 sold listings with DOM of 37 days and an average price per sq. ft. of $630. It is taking longer to sell, for a price about 7% lower.

Brentwood: Condos

Second Quarter of 2009, there were 43 listings sold with DOM of 96 days, and an average price per sq. ft. of $444.
Comparing the same time frame of 2006, there were 59 listings sold with DOM of 38 and an average price per sq. ft. of $528. A drop of almost 16%.

Clara’s note: The statistics usually provide a very general picture of a big market. Every building and property is unique in its way, since the Westside is not a cookie cutter community with relatively newer development. So when I provide my broker price opinion (either to the bank or homeowner), I take into consideration not just the recent comparable sales, but also the individual building and unit’s unique attributes. That is where experience and expertise come into play to provide a more accurate assessment of pricing.

As for the single family residence market, I really don’t think statistics give it a fair assessment for pricing. Every street and every home is special in its own way. Here are some facts and my interpretation:

Brentwood: Houses

Second Quarter of 2008: 51 properties sold, with DOM of 59 days and an average price per sq. ft. of $897
Second Quarter of 2009: 55 properties sold, with DOM of 90 days and an average price per sq. ft. of $712, a drop of 20%
July 2009, listing on 594 Moreno Ave, a three bedroom house (about 2848 sq. ft.) on a 11,340 sq. ft. lot, sold for $2,725,000. This same house sold for $3,305,000 two years ago—a drop in value about 10.3%

Pacific Palisades: Houses

Second Quarter of 2008: 56 properties sold, with DOM of 79 days and an average price per sq. ft. at $889
Second Quarter of 2009: 44 properties sold, with DOM of 92 and an average price per sq. ft. of $704, a drop of 20%
15248 De Pauw Street: a 5 bedroom house, 3632 sq. ft. of living space on a 7,500 sq. ft. lot. Sold for $2,415,000 in May 2009, which is very close to the 2004 sales price of $2,467,500. The home is very near the Palisades Village. Recession or not, a family still needs a good house to live in.
1609 Casale Road: a completely remodeled 5 bedroom house with 5,600 sq. ft. of living space with a 15,600 sq. ft. lot. Sold for $3,900,000 in May 2009, compared with a sales price of $5,145,000 in October 2005—a drop of 22%.
609 Amalfi Drive: 8000 sq. ft. house in the same Palisades Riviera area, sold for $7,050,000 in Aug 2009, compared to the sales price of $8,227,082 in March 2006—a drop of 14%.

Malibu: Houses

As the price range of houses are so wide and the average number of sales per quarter is only about 20, it will be very inaccurate to do a statistical analysis of the area. The high end home in Malibu really holds its value. See examples like 22355 Carbon Mesa Road—amazing Mediterranean gated compound with La Costa beach rights; listed for $7,950,000 and sold for over the asking price at $8,500,000 in April 2009.

Beverly Hills: Houses

1435 Loma Vista Drive: 4,238 sq. ft. of remodeled home, sold for $5,500,000 in July 2009 compared with its more original conditioned sale price of $3,060,000 in Dec 2007. A very nice and chic renovation still generated good returns in a good neighborhood.
521 N. Alpine Drive: 3,321 sq. ft. house on a 12,430 sq. ft. lot sold for $3,695,000 in March 2009; almost the same price as in April 2006.

Santa Monica: Houses

327 Alta Ave: a 3,742 sq. ft. house on a 10,440 sq. ft. lot; sold for $3,600,000 in May 2009—more than an 8% appreciation over its sale price of $3,295,000 in March 2005.
854 23rd Street: a 4,272 sq. ft. house on an 8,000 sq. ft. lot; sold for $2,800,000 in May 2009—a drop of 20% from its sale price of $3,500,000 in April 2006.

Mar Vista: Houses

There were 54 properties that sold within the price range of $700,000 to $1,200,000 from January to July 2009. Twelve of them sold either very close to asking or above asking, making it one of the strongest real estate markets on the Westside.

Again, every house on every street is unique in its way. I don’t think just applying the price per square foot method is an accurate estimate of home price.

If you are a homeowner, and you are interested in knowing how much your home is worth in today’s market, please call or email me to request a no-obligation home analysis.

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Property showcase

Dream a Bigger Dream

The most expensive residential listing in the U.S. – Candy Spelling’s Holmby Hills mansion, listed for $150 million. (source: LA Times)

The mansion consists of 56,500 sq. ft., looks like a French chateau, is slightly larger than the White House, and is the largest home in Los Angeles County. The house is described as the “greatest entertainment house ever with a kitchen where you can cook for two or 800.” The house is believed to have more than 100 rooms.

For me, a bigger dream would be owning a house on the Santa Monica beach.

972 Palisades Beach Road, a five bedroom European Villa on a double lot of almost 11,000 sq. ft., right next to the sand. The house is listed for sale at $15,999,000 and leases for $65,000 per month

The investment that makes $ sense

When I travel, I always like checking out properties that are easily managed (like with full service maintenance crew in the building), well priced and yield a reasonable rate of return. I am happy to say that we have a “winner” on the Westside that fits all these requirement.

The Azzurra del Rey, built in 2003, offers luxurious high-rise living in the Marina. It features guest valet parking, concierge, rooftop sky-lounge, pool, hot tub, fine art collection, professional fitness center with Yoga/Pilates studio, and close proximity to LAX and the beach. Some units offer city light views, some offer marina and ocean views.

The one bedroom ranges from about 850 sq. ft., and has been selling in the range of $400,000. Even the monthly HOA (maintenance and management dues fee) is about $900 per month. It generates a return of about 5% or more, as it usually can be rented out for about $2800 per month, depending on the size of the unit and its view exposure.

The two bedroom ranges from about 1200 sq. ft., and has been selling at around $600,000. It could be rented out for around $5000 per month, again depending on the size of the unit and the view exposure.

The larger floor plan consists of a three bedroom unit with about 2,200 sq. ft., on average selling for about $1,800,000 and renting for around $9,000 per month. This is still a return of about 5%.

What should be included in your Buy and Hold Portfolio?

Definitely apartment buildings in great neighborhoods. In the current market, buyers of multi-family units will benefit from historically low interest rates and much lower prices as compared to a couple of years ago. Owners/investors who can afford to purchase now can expect both price appreciation of the investment and rental income increase as many people won’t be able to qualify to purchase their homes, thus tightening the demand and forcing up rents.

What qualifies as a “great neighborhood” for me, besides a low crime rate and close proximity to the beach? I look at average asking rents and vacancy rates. Santa Monica has a good combination of high rent (average $2400) and low vacancy rate (about 3.4%).

Among all the available properties, I like one on 12th Street in Santa Monica, located north of Wilshire Blvd and South of Montana Ave, only 12 blocks from the Ocean. The address also falls within one of the most popular school districts, which many residents are willing to pay a premium for. This is a two building complex with 9 units (mainly one bedroom, 1 bath) listed for $2,575,000. The net operating income per year is about $144,955, yielding a rate of return of 5.6%. Units have hardwood floors inside and some even have private yard areas.

Buyers – If you are interested in receiving more detailed information and additional photos of these properties, please email or call Clara.