I know this is the question on everyone's mind right now.  I've also been hearing so much concern around the financial markets that even very qualified individuals are unwilling to talk to loan brokers to find out exactly what they would need to obtain a loan to buy a home.  Now IS a buyer's market and a great time to be buying a home that you will live in for several years.  I would encourage you to not become paralyzed by the media, but to get actual information that is specific to your financial situation.

Below, is some information that passed through my email box in the last week.  I have a lot of trust in these guys and they have been known to save many deals in the last couple of years.  So, if you are thinking about buying, I would strongly recommend contacting these guys and having them review your finances.  Scott Engel, (310) 656-8261, scott@candoloan.com or Max Byfuglin, (310) 656-8250, max@candoloan.com

Conforming Loans (up to $417,000)

30 Year Fixed	10 Year Fixed	5 Year Fixed
6.250%	6.750%	6.500%

    
Jumbo Loans (up to $729,500)

30 Year Fixed

6.125%

    
Super Jumbo Loans (up to $3,000,000)

10 Year Fixed	7 Year Fixed	5 Year Fixed
6.750%	6.500%	6.000%

Longer-term mortgage rates fell for the first time in three weeks roughly following bond market yields. Meanwhile, the latest housing market data showed some pickup in home purchase activity in August. Pending existing home sales in August rose 7.4 percent, reflecting the largest monthly increase since October 2001, and July's figures had an upward revision, according to the National Association of Realtors. More recently mortgage applications for both home purchases and refinancing grew slightly over the week ending October 3rd, reversing a two-week decline, based on figures from the Mortgage Bankers Association. Oct. 13 (Bloomberg) -- U.S. stocks staged the biggest rally in seven decades on a government plan to buy stakes in banks and a Federal Reserve-led push to flood the global financial system with dollars. The Standard & Poor's 500 Index rebounded from its worst week in 75 years with an 11.6 percent advance, its steepest since 1939, and the Dow Jones Industrial Average climbed more than 936 points. Morgan Stanley soared 87 percent after sealing a $9 billion investment from Japan's Mitsubishi UFJ Financial Group Inc. Alcoa Inc., Johnson & Johnson, Chevron Corp. and Prudential Financial Inc. posted their biggest gains since Bloomberg began tracking the data. Europe's benchmark index climbed 10 percent, its best jump ever, and Asia's added 3.1 percent. ``The worst of the immediate danger is past,' said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, which manages $30 billion. ``It's always easier when you've got markets going up and you're not having to talk clients back in off the ledge.' The S&P 500 rose 104.13 points to 1,003.35. The Dow increased 936.42, or 11 percent, to 9,387.61, eclipsing its previous record 499-point gain in March 2000 and posting its best percentage advance since 1933. The Nasdaq Composite Index climbed 194.74, or 12 percent, to 1,844.25. Sixteen stocks gained for each that fell on the New York Stock Exchange. The S&P 500 halted an eight-day losing streak, its longest since 1996. Last week's 18 percent declines pushed both the S&P 500 and Dow down more than 40 percent from their peaks last October. The S&P 500 ended last week trading for 17 times reported earnings of its companies, the cheapest valuation in more than a year.

 

I was preparing comparable sheets for a house I held open in the Pacific Palisades several weeks ago and I was really struck by the homes and their prices.  For the same type of money in Malibu, one would be able to get close to an acre of land, views of the ocean, a great school district and much more. 

I’ve lived in Malibu for more than 10 years now and have come to love the slower pace, small community, natural beauty, great schools, and families that I have met.  I know Malibu sometimes gets the reputation of only being for the rich and famous, but I’d like to help you think of Malibu as a great place to make your life. 

Below are a few of the current listings in Malibu that I consider to be great places to call home:

20537 LITTLE ROCK WAY (Big Rock Canyon)
List Price: $1,699,000 (approximately $1,000 per square foot)
3 bedroom, 2 bathroom, 1,700 sq. ft, Lot Size: 31,559
Beautiful remodeled family home with lots of grass to run and play.  Close to town, ocean views, travertine floors, and much more.

 
29343 BLUEWATER RD (Point Dume)
List Price: $2,590,000 (approximately $1,000 per square foot)
3 bedroom, 2 bathroom plus artist studio, 2,593 sq. ft, Lot Size 48,325
Lowest priced home on Point Dume.  Great school, lots of land, mature landscaping and fruit trees.  Single story ranch home with open floor plan.


25321 MALIBU RD (Old Malibu Road)
List Price: $3,095,000 (approximately $1,350 per square foot) 
3 bedroom, 2 bathroom, 2,288 sq. ft, Lot Size 15,258
Classic Post and Beam construction with exotic tropical vibe and excellent indoor/outdoor flow.  Whitewater views with large deck for sunbathing, entertaining and watching sunsets.  Easy access to the beach across the street.

6311 GAYTON PL (1 mile up Kanan)
List Price: $4,400,000 (approximately $730 per square foot)
6 bedroom, 7.5 bathroom, 6,053 sq. ft, Lot Size 60,548
Hampton’s in Malibu with this beautifully complete home.  Ocean and Bonsall Canyon views from almost every window.  Lush landscaping, pool, guest quarters, spa and sauna, and surrounded by a white fence ideal for horses.

 

Recently Sold Properties in Malibu

 

While the U.S. Housing market is in a sharp decline, each local market is being affected differently.  When thinking about buying or selling a home it is very important to talk to a local real estate agent that is knowledgable about the area.  For example, Malibu prices have come down some but the price decreases seem to be hitting the lower and higher end home price ranges.   

 

Below is a sample of Single Family Residences sold since April 1, 2008.  I have only included the homes that sold for more than a 15% price reduction over the original list price.

 

Moral of the Story for Buyers:  Don’t be afraid to make an offer!

 

To ask me more questions, or have me help you find a property, email me at: janet@callmalibuhome.com or call me at 310.924.4631.

 

 

	Property Address: 5617 Busch Dr, Malibu, CA 90265 Original List Price: $2,695,000  Sold Price: $2,202,500 % Reduction: 18% Date Sold: 4/1/2008
	Property Address: 6756 Wandermere Rd, Malibu, CA 90265 Original List Price: $2,750,000  Sold Price: $1,900,000 % Reduction: 31% Date Sold: 4/4/2008
	Property Address: 20444 NW Pacific Coast Hwy, Malibu, CA 90265 Original List Price: $2,800,000  Sold Price: $2,100,000 % Reduction: 25% Date Sold: 4/9/2008
	Property Address: 6408 Trancas Canyon Rd, Malibu, CA 90265 Original List Price: $1,950,000  Sold Price: $1,550,000 % Reduction: 21% Date Sold: 4/22/2008
	Property Address: 30736 Principio Drive, Malibu, CA 90265 Original List Price: $2,150,000  Sold Price: $1,770,000 % Reduction: 18% Date Sold: 4/29/2008
	Property Address: 4022 Escondido Drive, Malibu, CA 90265 Original List Price: $1,695,000  Sold Price: $1,235,011 % Reduction: 27% Date Sold: 5/5/2008
	Property Address: 20530 Pacific Coast Hwy, Malibu, CA 90265 Original List Price: $2,129,000  Sold Price: $1,750,000 % Reduction: 18% Date Sold: 5/14/2008
	Property Address: 31425 Birdella Road, Malibu, CA 90265     Original List Price: $1,495,000  Sold Price: $1,040,000 % Reduction: 30% Date Sold: 5/19/2008
	Property Address: 423 Woodbluff Rd, Malibu, CA 90265 Original List Price: $2,395,000  Sold Price: $1,910,000 % Reduction: 20% Date Sold: 5/23/2008
	Property Address: 30718 Pacific Coast Hwy, Malibu, CA 90265 Original List Price: $13,900,000  Sold Price: $11,500,000 % Reduction: 17% Date Sold: 5/28/2008
	Property Address: 23476 W Moon Shadows Drive, Malibu, CA 90265 Original List Price: $1,795,000  Sold Price: $1,083,000 % Reduction: 40% Date Sold: 5/29/2008
	Property Address: 11770 Pacific Coast Hwy, Malibu, CA 90265 Original List Price: $2,400,000  Sold Price: $2,020,000 % Reduction: 16% Date Sold: 6/5/2008
	Property Address: 27082 Malibu Cove Colony Dr, Malibu, CA 90265 Original List Price: $5,100,000  Sold Price: $3,500,000 % Reduction: 31% Date Sold: 6/25/2008
	Property Address: 2020 Stunt Rd, Malibu, CA 90265 Original List Price: $1,799,000  Sold Price: $1,300,000 % Reduction: 28% Date Sold: 6/29/2008
	Property Address: 30014 Zenith Point Rd, Malibu, CA 90265 Original List Price: $5,500,000  Sold Price: $4,500,000 % Reduction: 18% Date Sold: 7/15/2008

So You Are Selling Your Home!!!

Lately, there has been so much information in the news about the real estate market and how depressed it is.  However, people are still selling their properties and new properties are being listed every day.  So, how do you sell your home in this market?

As a seller you must take into consideration that we have a different type of real estate market than the last couple of years.  This is a buyer's market, which means you need to think of your home more like a commodity and less like a unique item.  While everyone feels their home has special qualities that make it stand out from other properties in their area, a buyer's market doesn't allow for a seller to use these qualities to price their home higher than the home next door.  How do you present your home to help the buyers feel like they're making a wise purchase and getting more for their money?

Remember, first impressions are everything.  Understand that your home will get the most activity in the first two weeks it is on the market and if it is overpriced in the initial weeks, you may lose out on many potential buyers.

Second, if a comparable home sold recently, the sale price of that home was negotiated approximately 60 days earlier and that price is probably not an accurate reflection of the market today.

Third, buyers want to feel that they are getting a good price, not watching their money disappear in front of their eyes.

Lastly, the real estate market follows the economic principles of supply and demand like most other markets.  Currently, we have a higher inventory of homes and a longer "days on market" than in the past.  Until the inventory of homes and "days of market" start to decrease, we will be in a buyer's market.

Moral of the Story for you as a Seller: Homes will continue to be considered a commodity and selling your home is all about setting it at the right price!

To ask me more questions or to get an assessment of the value of your home, email me at: janet@callmalibuhome.com or call me at 310.924.4631

No one person can predict or have the guaranteed answer to this question, however, with careful analysis one can begin to make a more educated decision.  I have completed an analysis of the Malibu Real Estate market from January 1, 2008 thru May 15, 2008 to assist you in making more informed decisions when it comes to real estate.

The data I collected was broken down into the following categories:

• Single Family Home Sales from $0 to $1.5 M
• Single Family Home Sales from $1.5 M to $2.5 M
• Single Family Home Sales from $2.5 M to $5 M
• Single Family Home Sales from $5 M to $8 M
• Single Family Home Sales above $8 M
• Condo Sales
• Land Sales

Single Family Home Sales from $0 to $1.5 M
There were eight (8) homes that sold between January 1, 2008 and May 15, 2008.  Five of the eight homes were mobile homes.  The Average Sales Price was $698,751 while the Median Sales Price was $687,500.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 20% and the Median decrease was 24%.

Single Family Home Sales from $1.5 M to $2.5 M
There were eleven (11) homes that sold between January 1, 2008 and May 15, 2008.  None of them were mobile homes.  The Average Sales Price was $2,060,227 while the Median Sales Price was $2,100,000.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 17% and the Median decrease was 18%.

Single Family Home Sales from $2.5 M to $5 M
There were eight (8) homes that sold between January 1, 2008 and May 15, 2008.  The Average Sales Price was $3,668,750 while the Median Sales Price was $3,762,500.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 8% and the Median decrease was 5%.

Single Family Home Sales from $5 M to $8 M
There were six (6) homes that sold between January 1, 2008 and May 15, 2008.  The Average Sales Price was $6,213,833 while the Median Sales Price was $6,000,000.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 6% and the Median decrease was 8%.

Single Family Home Sales above $8 M
There were five (5) homes that sold between January 1, 2008 and May 15, 2008.  The Average Sales Price was $15,950,000 while the Median Sales Price was $14,000,000.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 20% and the Median decrease was 16%.

Condo Sales
There were eight (8) homes that sold between January 1, 2008 and May 15, 2008.  The Average Sales Price was $1,136,875 while the Median Sales Price was $1,212,500.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 14% and the Median decrease was 13%.

Land Sales
There were seventeen (17) land deals that sold between January 1, 2008 and May 15, 2008.  The Average Sales Price was $1,419,529 while the Median Sales Price was $750,000.  What is more interesting to note is percent decrease from the Original Sales Price to Actual Sold Price.  The Average percent decrease was 21% and the Median decrease was 10%.

As I look at this information, several points stick out in my head for Malibu.

• Single Family Home Average Value based on Sold Homes between $0 and $2.5 million have dropped between 17% and 20%
• Single Family Home Average Value based on Sold Homes above $8 million have dropped 20%
• Condo Average Value based on Sold Condos has dropped 14%
• Land Average Value based on Sold Land has dropped 21%
• However, Single Family Home Average Value based on Sold Homes between $2.5 and $8 million have only dropped between 6% and 8%

Buyers Moral of the Story:  If you are in the lower or higher end of the purchasing market, there are plenty of opportunities to purchase something for significantly less money than before.  As long you are in the market to hold on to the property for more than a couple of years, this is YOUR market!

Sellers Moral of the Story:  If your home is in the $2.5 to $8 Million range the average value of your home seems to be holding relatively firm.  You will most likely have a fairly strong return on your asset if you sold now.

To find out more about Malibu homes, contact me at: 310.924.4631

Here are two links below talking about the housing market:
 
The Housing Crisis Is Over – WSJ article

Money File – Nightly Business Report PBS: How Best to Buy in this Housing Market

 

With all the information and debate about the real estate market in the last year, it is very hard to determine what’s really going on.  However, one thing that is clear is that each local market has its own cycle and general market trends and articles may not apply to your local market.

I have done a summary for Malibu’s Real Estate market for the first part of 2008 (January 1, 2008-April 7, 2008).  Some interesting information has come from this summary that I would like to share with all of you…

First of all, let’s talk volume.

• There have been 26 single family homes that have closed escrow in this year to date
• The median price was $3,687,500 and the average price was $4,905,788 
• The highest sale during this time period was $18,975,000 and the lowest price was $220,000.
• There were 4 homes that sold above the $10 million mark and 22 homes that sold below the $10 million dollar mark

Now, let’s look at Days on Market (DOM) or the number of days it took to sell a property.

• The average DOM(total number of DOM divided by the total number of homes) was 197 days
• The median DOM (the number of DOM that is in the middle of all the DOM) was 165 days
• The longest DOM for the 26 homes was 679 days (the home finally sold after a 36% price reduction)
• The shortest DOM for the 26 homes was 18 days (the home had only a 3% price reduction)

Next, let’s look at Percentage of Price Reduction (Initial Listing Price minus Sold Price divided by Initial Listing Price)

• The average price reduction in percentage was 14%
• The median price reduction in percentage was 12%
• The highest price reduction in percentage was 36%, again also the longest DOM home
• The lowest price reduction in percentage was 0%

While this is a lot of data to sort through or draw conclusions from, two statistics really stand out to me.

• The Average DOM for homes that had the largest price reductions (above both the average and median price reduction percentage) was 320.25 days
• The Average DOM for homes that had the smallest price reductions (below both the average and median price reduction percentage) was 91.14 days

Buyers Moral of the Story:  Deals are being made for 12-15% below asking price…don’t be shy to make offers and begin the negotiating process

Sellers Moral of the Story: Price your home appropriately and it will sell quickly, price you’re home poorly and you will be waiting and waiting and waiting.

To find out more about Malibu homes, contact me at: 310.924.4631

Best Time to Buy in Four Years!!!

Valuations—the difference between a home’s actual price and what it should cost—are the lowest they’ve been in four years.

MAKING SENSE OF THE STORY FOR CONSUMERS

• More than 88 percent of 330 housing markets surveyed showed price declines and improved affordability during the last three months of 2007, according to bank National City Corp. and financial analysis firm Global Insight.
• The survey covered home valuations during the last quarter of 2007, but there's reason to believe that valuations are even more favorable for buyers today, according to the authors of the report.
• The biggest gains in affordability occurred in California, Michigan and Florida, which are areas that also have been some of the hardest hit by foreclosures. Those states registered 43 of the 50 biggest price declines.

To read the full story, please click here.

President Bush Wednesday signed off on the $168 billion stimulus packaged approved by Congress last week, which, in addition to tax rebates for millions of working Americans and business owners, includes a vital, but temporary increase in the conforming loan limit.  The economic stimulus package will allow the Federal Housing Administration, as well as Fannie Mae and Freddie Mac, to offer mortgages above the current conforming loan limit of $417,000 to as much as $729,750 in high-cost areas using a formula that considers an area’s median home price. The increase would only apply to loans originated between July 1, 2007 and Dec. 31, 2008. A host of details remain to be worked out, including how the median home price is established.

MAKING SENSE OF THE STORY FOR CONSUMERS

• It could be several months before the impact is felt in the mortgage markets. Wall Street is still working out whether investors will want to bundle securitized loans above $417,000 with loans below that level, or if they will invest in them separately.
• Rates for such loans might be higher because banks fear larger loans are riskier, but they’d still likely be lower than current jumbo rates.
• Even though the proposal does not apply to loans made before July 1, borrowers with older mortgages could refinance into new loans that would be sold to Fannie and Freddie, because those loans would be considered new loans.

To read the full story, click here

"The Federal Reserve cut a key short-term interest rate by a half-percentage point, the second significant rate cut in just over a week, in an effort to stave off a growing risk of a national recession..." CAR Newsline, Wednesday, January 30th, 2008

To those of you that are still trying to figure out exactly what is being said about our financial markets, I thought I might try and simplify things for you.  So here goes...

When homes were selling quickly, the banks had extra money to give away and so they incentivized the public in the following manner: 

• Required very little documentation to qualify
• Little or no money down 
• Low introductory interest rates

The banks didn't really worry too much about the default rate of these loans because the housing market was booming.  Secondly, and more importantly, the banks were not holding on to the loans they made.  In otherwords, once the banks made these risky loans, they would group many of them together and sell them in the financial markets (secondary mortgage market) so that they could have cash available in their bank to loan more money to other customers. 

With the housing market  and economy slow down some people began to default on the loans.  The secondary mortgage market also realized the riskiness of the loans and decided to stop buying these loans from the banks.  When that happened, we had the first real problem with the banks and mortgages.  The banks had no money to lend to people because they had lent out money they expected to recieve from the secondary mortgage market but they weren't receiving it.  In effect, the banks had over-leveraged themselves.  There was in fact, a shortage of money at the banks.  In order to counteract their problem, the banks had to tighten their lending requirements and raise rates.

The Federal Reserve is cutting short-term interest rates in an effort to stimulate more money back into the banking system and help restart the housing cycle again.

More Info