Orange County Bank Owned Homes: Buying Opportunity

Posted by admin on May 14, 2012 in MXM Blog | 0 comments

These days the words “bank owned homes” have become practically synonymous with a single word: “opportunity.”  With prices and mortgage rates this low, first time home buyers, investors and seasoned property owners alike are looking at a raft of buying options unlike any Orange County has seen in a very long time. 

That option of buying a bank owned home has certainly opened a viable route for those looking to own a home at the fraction of what it cost just a few years ago. But not without a price:  the best Orange County bank owned home bargains are almost certain to fall into the ‘fixer-upper’ category.

When considering the purchase of one of our Orange County bank owned homes, I’ve found that my most successful clients have a few qualities in common

• patience – they wait until they’ve found a house that suits all their needs
• prudence – they resist the temptation to take out too big of a loan
• realism – they know how much hard work they will be willing to put into the house

Finding the right fixer-upper should be approached as a process: in other words, never buy the first home you see until after you’ve checked out some of its competition. There are more foreclosures on the market than ever – a phenomenon that works to your advantage. When you do find the right home, make sure to take out a loan that makes sense. Often people who are in a hurry to buy a house are tempted to take out a loan without giving enough consideration to its immediate and long-term implications.  Being coolly realistic as you work out the numbers will pay off for a long time.

Once a bank owned home is officially yours, the hard (often fun!) work begins. Buying a home in need of repair has always been the surest way to find a deal, but it is also the way to improve or develop home maintenance skills, bond with family members, and keep a tight rein on the family budget. Here, too, you need to be careful not to get carried away– you don’t want to overbuild or overdevelop beyond what is appropriate for the neighborhood setting. In other words, keep your end goals in mind.  My advice to clients varies depending on their individual needs: Is it an income property?  Or the family home for the next 15 years?

Foreclosures show no signs of slowing down in the near future, so this May’s buying market is opportune.  If you’re considering buying a bank owned home in Orange County, call me today to go over your options and to put a plan into action!

Million-Dollar Foreclosures Up, Midrange Down

Posted by admin on May 9, 2012 in MXM Blog | 0 comments

It’s not what you would guess, but there it is: according to CNNMoney, the firm that keeps track of foreclosures has reported that the foreclosures on million dollar properties is growing while foreclosures for mid-range properties are beginning to drop.

It’s been five years since the housing market began its precipitous drop. During that time, overall growth in foreclosures has been front and center for headline writers in Orange County and throughout the rest of the nation.  But only now are foreclosures among some of the nation’s wealthiest homeowners drawing attention. The foreclosure rate is rapidly increasing in this group –and at a faster rate than for the rest of the United States. Surprising also is that many of these wealthy families are doing so voluntarily.

RealtyTrac is the firm quoted by CNNMoney. Its data show that last year upwards of 36,000 homes valued at $1,000,000 or more were foreclosed upon or served with a notice of foreclosure (default). Even though that is fewer than 2% of all foreclosures nationwide, it still represents a greater number of foreclosures than seen in earlier years. For wealthier homeowners who actually could continue to make mortgage payments but decide not to, it can be a business decision. Financial experts call such foreclosures “strategic defaults.”

RealtyTrac also found that the number of foreclosures on properties valued at $1 million or more has risen by 115% in the last five years, and twice as fast for those worth more than $2 million. However, among mid-range homes – those valued between $500,000 and $1 million — foreclosures actually dropped by 21% during the same period.

It seems that the housing crisis may be ending from the bottom up, with borrowers who purchased lower-cost homes now beginning to emerge from the storm, even as some of the wealthier families (admittedly a very small percentage of them) go through the same trial.

The silver lining?  If you are looking to buy a home in the $1,000,000+ range, now could be your window to snag a once-in-a-lifetime value!  Call me if you would like to see a complete picture of all the Orange County properties for sale this May.

Buying a House in Today’s Mortgage Market

Posted by admin on May 7, 2012 in MXM Blog | 0 comments

Anyone interested in buying a house in Orange County today has heard that they should expect to find tougher mortgage lending requirements. Sometimes that can seem arbitrary — or just plain unfair. But unfair or not, the new lending reality is probably here to stay for a while, and the causes are understandable.

The mortgage industry learned a powerful lesson from the past, when it pretty much gave anyone who

applied a generous loan – sometimes with practically no questions asked. But this “generosity” created financial problems for both the banking industry and the country as a whole. It’s not hard to understand why lending guidelines are stricter.

Reducing Loan Defaults

The overriding reason for tougher lending policies is to reduce the number of loan defaults. In order to qualify for a mortgage, borrowers are finding that lenders now look more closely, may require a higher annual income, better credit score, or a larger down payment. Their high-priority goal is preventing any foreclosure situation where the bank owns a property it has to sell or rent itself.

Questioning Future Value

For many years, home buyers never questioned the investment value that seemed to automatically accompany any piece of real estate. Buying a house was like investing in a blue chip stock: certain to rise. The advent of a shrinking Dow Jones Average preceded the phenomenon of ‘upside down’ homeowner equity. But in both cases, long gone is the idea that everyone should expect to find no-brainer investment opportunities. When buying a house can mean exposing the lender to a future where more is owed than a house is worth, they naturally seek a safer place for their money.  Since a smaller loan or larger down payment achieves that goal, that’s what lenders tend to offer.

Lowering Consumer Debt

During 2010, the nation’s ten largest mortgage lenders turned down about 26% of all applications (according to the Wall Street Journal).  In many cases, that could be attributed to lowered credit scores – due in turn to increased debts from credit cards or unpaid student loans. In fact, those heavy debt loads are part of what got homeowners into financial trouble and helped to fuel the housing market crisis.

In the short term, home buyers denied a loan can’t help but be keenly disappointed. But it can ultimately provide time to let them raise their credit scores, increase their savings, and get their financial affairs onto firm ground. The ultimate effect should be to put the whole housing market there, too.

If you’re considering buying a house in Orange County, I’d like to help you get per-qualified under the current mortgage guidelines. Once you see what real values are out there and available to you, I think you’ll be glad you called!

Orange County Listing Agent Helps Set the Stage

Posted by admin on May 5, 2012 in MXM Blog | 0 comments

Deciding to put your house on the market? Recruiting an experienced Orange County listing agent will give you a leg up on the competition.  He or she will know where you need to spend money, and where you don’t.

A good example is dealing with staging – the ‘show biz’ of the real estate world.  Complete staging is expensive and sometimes just is not practical.  A great listing agent will help you decide whether staging is imperative for your home – and if it is not, will offer some basic fixes to help you work with what you have.

1. The first stage to set? The front yard. If the street view is untidy or the yard overgrown, you can lose your audience before the performance even begins. Of course, you will keep the lawn cut and fix the fences and gates – but also think creatively. People’s eyes are drawn to color, so adding a few cheerful annuals in pots and hanging baskets and placing them strategically can do wonders. If the front or garage doors are even a little bit chipped or flaking, sand and paint them. If trees or bushes are blocking sunlight from the front windows, take the trimming shears to them. All of this should take no longer than a weekend (and cost less than $150).

2. Buyers are not really just an audience: you want them to be participants. You want them to be able to visualize their furnishings in your space. Professional stagers have a simple arithmetic rule:

Subtracting Furniture = Adding Space

You add space by removing bulky, old or mismatched furniture. As your listing agent, I can help you walk through the house and decide what should stay and what should go into storage. Moving them can take about a weekend; cost will be the price of storage (or half of your garage – the next best option.

3. Have you ever walked into an expertly staged home and seen dirty socks hanging out in the bedroom?  Didn’t think so.  Nothing is quite as off-putting as evidence of personal hygiene.  Kitchens, bedrooms and bathrooms need special hospital-clean sparkle. Do laundry frequently, and why not use a stagers’ extra? Light candles, set air fresheners — and open windows wherever you can.

The market has begun to show signs of new activity, but even so, similar homes are still competing for the same group of buyers. That’s why it is vital that you present your home as favorably as possible.  Staging decisions are a good example of how I, as a listing agent with comprehensive knowledge of our Orange County market, help you maximize your home’s potential. It is one of the ways I work hard for you – - just part of the complete service I am proud to offer. If you are considering listing a home in Coastal Orange County, call me anytime for a consultation!

Orange County Home Sales Outlook Brightened by National Report

Posted by admin on Apr 23, 2012 in MXM Blog | 1 comment

With more than 1,000,000 members the National Association of Realtors^® is the nation’s largest trade association. It’s no wonder that what it says carries a lot of weight. When a gargantuan outfit like NAR makes a prediction, its words may not always make headlines, but they do influence everyone whose job it is to forecast the future of the nation’s economic activity.

That’s why their most recent report dealing with pending home sales put smiles on many of those one million members’ faces. “The spring home buying season looks bright,” according to Chief Economist Lawrence Yun. “If activity is sustained near present levels, existing-home sales will see their best performance in five years.”

Like all statistics, those he was describing can be looked at in more than one way. We know that some numbers are more reliable than others. This particular index is based on an unusually large sample: about 20% of all transactions for existing home sales. It’s a forward-looking indicator: in the past, it has signaled coming trends before they materialize. This index seldom produces a straight line of activity because of seasonal and monthly ups and downs, but this time a trend is evident that is “notably above the pattern from a year ago.”

Our Orange County home sales patterns are not invariably tied to national trends — but they aren’t impervious to them, either.  So we are pleased when our own impression that the spring market is looking up is borne out by the experts who deal in the broader picture. “Based on all of the factors in the current market,” Yun went on; he expects to see “sales rising 7 to 10 percent in 2012.”

Real estate is a famously local phenomenon, and although we keep an eye on the national and state markets, our real attention is always centered right here in Orange County. If you have questions about your own real estate outlook, call me anytime for a consultation focused on your neighborhood.

Home Automation: The Next Big Thing?

Posted by admin on Apr 18, 2012 in MXM Blog | 1 comment

Advanced technology has become such a prominent feature in our everyday lives it is no surprise that it’s increasingly affecting Newport Coast home values. As “Home Automation” features grow in importance, bottom-line home values are following suit. It’s a new phenomenon, one that motivated home sellers (as well as homeowners heeding long term home values) should understand.

Home automation – the inclusion of luxury technological features like temperature control, lighting control, security systems and the like – are becoming more commonplace, increasing home values in the process. A few years ago, adding such bells and whistles to an existing home would probably have been more pricey than the return would justify — but that is becoming ever less true. Think hi def flat screen TV and you’ll have a good example of the direction home automation is headed: ever-improving features for lower and lower prices.

As automated features become more widespread and their prices lower, some of them are growing increasingly simple to add. And the scope of home systems and their effect on home values can be quite varied. For some, adding an ‘automation system’ might consist of something as simple as installing remote or automatic control of a few lights. Others might make electronic security the key, choosing to install a full-fledged central system.

Where wireless home Internet networks are already in place, home values can easily be raised by the addition of remote operation. Right now that may sound like an unnecessary futuristic feature, but it may turn out that being able to control lights or heating systems from afar could substantially increase energy efficiency (along with home values).

Matthew Berman, one of the owners of New York design firm Workshop/apd, was recently quoted in the New York Times describing a “whole-home” lighting system.

“A popular feature of this kind of system is the ability to hit one button when you’re leaving your house to turn off all the lights.” As a practical matter, he also recommended keeping automated systems separately controllable, making them less complicated to operate and less subject to breakdown.

It’s important to think long-term as well as short-term — especially for anyone looking to increase home values, whether for future or immediate sale. Home automation is looking like a worthy candidate for the Next Big Thing, and buyers might be ready to gravitate toward advanced features that distinguish one Newport Coast luxury seller’s home from the competition.  Call me if you would like to discuss how home automation might come into play when it comes to selling your Newport Coast home.

Being Smart About Maxing A Home’s Value

Posted by admin on Apr 18, 2012 in MXM Blog | 0 comments

When it comes time to put their home on the market, the Number One topic Orange County sellers focus on is Orange County home prices:  home prices historically, home prices this April, projected home prices in the future. What many sellers don’t truly realize is that they have more control over the price their home fetches than they may think.

Smart application of remodeling dollars to maximize a property’s salability is the earliest and most important action a homeowner can take. If you plan to remain in your home for the foreseeable future, lifestyle and personal preference issues will rightly get your attention. But if a move is on your planning horizon, remodeling decisions should be hard-eyed business decisions. In my experience, there are three rooms that buyers are particularly interested in – and homeowners bent on raising their own Orange County home prices should share that interest!

Kitchens can drastically raise or lower home prices.  Since kitchens have evolved into the major social hubs of American homes, increasing its size can be superbly cost-effective. If there is a possibility of and opening it up to living space by knocking down a non load-bearing wall, it is well worth considering. Upgrading appliances to stainless steel, replacing countertops with granite or other stone, and refinishing kitchen cabinets can absolutely give some much-needed appeal to an outdated kitchen. Just switching out old hardware for contemporary substitutes can add appreciably to a kitchen’s appeal.

Families spend much of their time in their living rooms – and even if they don’t, psychologically, it can seem the center of family activity. A cramped, cluttered and dark space will detract from other more attractive features of a home. A living room can be made into a bright and welcoming space by making inexpensive changes, such as removing all but essential furniture, painting walls a neutral color, and removing drab window coverings to let in as much light as possible. Replacing worn carpet with a wood laminate — or refinishing long-covered wooden floors — can take a bit more elbow grease and budget, but can be worth the cost.

In the master bedroom, homebuyers want to visualize a sanctuary where they can escape from the trials of their busy lives. Simple but effective changes can make all the difference. Remove large pieces of furniture (particularly desks and computers)…in other words, aggressively de-clutter.  Find pale, tranquil and soothing colors for the walls, and choose simple bed linens in complimentary colors (think “hotel luxury”). Make sure that clothes are not on show and that closet spaces are tidy, even if it means putting some of your apparel into storage.

The goal is always to make changes that allow buyers to see the potential in a home; it’s how individual local home prices can rise above general market trends.  If you’re considering selling a property and would like to discuss home prices in Orange County and ways to maximize values, give me a call today so we can schedule a free consultation