LA Westside BlogPOINT

LA Westside BlogPOINT

Craig Whitlock

Blog

Displaying blog entries 1-10 of 230

Disappointed With Your Appraisal?

by Craig Whitlock

Appraisal disappointing? You have options, according to the Appraisal Institute.
 
"Homebuyers and sellers should first understand what an appraisal is and how it's used," says Jim Amorin, president and acting CEO of the Appraisal Institute. "Real estate appraisals for mortgage finance applications are prepared for the bank or financial institution so they can better understand the collateral risk in making the loan. This can be confusing, because homebuyers typically pay for the appraisal and receive a copy of it."
 
In some cases, the appraisal may not match the contract price—but just because an appraisal comes in below (or above) the listing or contract price doesn't mean it's flawed, Amorin says. The agreed-upon contract price may be above market value, for example. In those situations, the buyer and seller often renegotiate the contract at more favorable or balanced terms.
 
Homebuyers should ask their lender for the qualifications of the appraiser, including whether they are designated by a professional association like the Appraisal Institute, says Amorin. A qualified and competent appraiser knows how to conduct a thorough market analysis and make appropriate adjustments.
 
Homebuyers also can ask whether the appraiser is directly engaged by the bank or whether the bank utilizes an appraisal management company, and what their procedures are for engaging qualified appraisers.
 
"The best way for consumers to combat potential problems with appraisals is to ensure the appraiser hired by their lender is highly qualified and competent," Amorin says. "Consumers have every right to demand the use of a highly qualified appraiser, someone with field experience in their market and knowledge and experience to handle the assignment properly."
 
Contrary to incorrect interpretations of appraiser independence requirements, appraisers welcome information that would assist the development of credible assignment results," says Amorin. If lender policies permit, consumers can accompany appraisers when conducting the property inspection and may provide the appraiser with any information they consider important.
 
Amorin suggests consumers ask their lender for permission to do so, and confirm the appointment. Consumers should also take note of whether an adequate inspection is performed. Did the appraiser spend enough time at the property to observe important features or improvements or potential problems?
 
Homebuyers should take advantage of their right to obtain a copy of the appraisal report," Amorin says. Even though the appraisal is ordered to help assess lender collateral risk, buyers are entitled to a copy of the appraisal report. Federal regulations require lenders to provide property buyers with free copies of appraisal reports no later than three days before the loan closes.
 
Although appraisal review is best performed by qualified appraisers, consumers should examine the appraisal for potential deficiencies, says Amorin. According to "Appraising the Appraisal: The Art of Appraisal Review," common errors in appraisals include: misuse of adjustments to comparables; disregarding special financing and concessions; or miscalculation of gross living area (GLA).
 
Amorin suggests consumers ask themselves:

  • Do adjacent homes add or detract from the value of the subject property?
  • Is the subject property equal to or lower in price than surrounding homes?
  • Does the floor plan have any functional problems?
  • Does the house (particularly the kitchen and bathrooms) require major remodeling to make it comparable with similar homes in the same price range?
  • Is the number of bedrooms and baths in the home comparable to similar homes in the same price range?
  • Did the appraiser perform an adequate inspection? 

"Most lenders have appraisal appeal procedures, known as 'Reconsiderations of Value,'" says Amorin. "If you're aware of recent, comparable sales information or items that may not have been available or considered by the appraiser, provide those to the lender. If problems were found with the first appraisal, you can and should obtain a second appraisal."
 
Source: Appraisal Institute 

Easement Rights and What You Should Know

by Craig Whitlock
 

Is your property subject to have any easements? Chances are it is. An easement is the right of another person or entity, such as a public utility or government agency, to use part of your property for a limited purpose that is usually beneficial to you; for example, utility easements over or under your property to serve the property and neighboring properties.
 
“Appurtenant Easements” Benefit a Neighbor’s Property
                       
If your property has an “Appurtenant Easement” over an adjacent parcel, then that parcel is said to be burdened by your easement.  Such easements are created for specific purposes, the most common of which is ingress and egress.  In order for your title company to insure such easements, they must be recorded in the office of the County Recorder where the property is located.
           
“Easements in Gross” Are Usually for Utilities
           
If your property has overhead or underground utility lines that also serve your neighbors, you’re probably subject to an “easement in gross.” Your property (known as the “servient tenement”) is burdened by the public utility easement.
 
Many properties have electric, phone, water, sewer, and cable TV easements along the back or side of the parcels. Most public utility easements are created at the time the parcels are subdivided and are recorded against the title to each benefited property.
                       
If the easement in gross was properly recorded, the property owner has no recourse and must tolerate it. However, if the homeowner’s title insurance policy did not disclose an underground easement in gross, then the title insurer could be liable for either (a) the diminished value of the property (if any) with the undisclosed easement, or (b) the cost of relocating the easement.
 
“Prescriptive Easements” Can Be Troublesome
           
A “prescriptive easement” can arise when someone, usually a neighbor, uses part of the property without the owner’s approval or consent.
           
Generally speaking, for a Prescriptive Easement right to arise in California:

  • The use of another’s land must be open and “notorious” (obvious).
  • The use must continue uninterrupted for a period of at least five years (occasional use could establish the prescriptive use right for the same frequency, e.g., on weekends).
  • The use must be “hostile” (i.e., not consented to), and characterized by an adverse claim of right.Prescriptive easements, after the required number of years of open, notorious, hostile and continuous use, can be perfected in a quiet-title lawsuit against the property owner.
The best way to prevent prescriptive easements from arising is to periodically inspect property boundaries to be certain a neighbor is not using part of the property without permission. If the non-permissive use is temporarily or permanently terminated, the use is no longer continuous. Or, if permission is granted, that will usually defeat a claim to the prescriptive easement because the hostility element is then lacking.
 
Reprinted with permission from Robert J. Bruss, Los Angeles Times.

Just SOLD 3BD Penthouse in Prime Westwood!

by Craig Whitlock

The Truth About Homeowner Equity

by Craig Whitlock

A recent article from a reputable news source was titled: Here’s why some homeowners still can’t sell. In the opening bullets of the article, the author claimed, “Negative equity is one of the main reasons why there are so few homes for sale.” The article then goes on to soften that stance but we want to bring better clarity to the equity situation.

A recent report from CoreLogic (which was quoted in the article) revealed that over 80% of all homes now have “significant equity,” which means the home has over 20% equity. That level of equity allows the homeowner to sell their home if they so desire. (There was no reference to significant equity in the article.)

If eight out of ten homeowners now have significant equity in their homes, it is hard to make the claim that lack of equity is “one of the main reasons why there are so few homes for sale.”

Here is a map showing the percentage of homes in each state which currently have significant equity:

The Truth About Homeowner Equity | Simplifying The Market

If you are one of many homeowners who is debating selling your home and are wondering how much equity you have accumulated, let’s get together to determine if now is the time to list.

What Is Mello-Roos?

by Craig Whitlock

Many buyers in California have become aware of the term “Mello-Roos” when looking to purchase new or previously-owned homes. For those that are unfamiliar, Mello-Roos is a special tax assessed to homeowners in a community as repayment for bonds used to fund the infrastructure within their community.
 
Normal services and infrastructure that Mello-Roos bonds help to fund include police services, schools, roads, ambulance and fire protection services, utility connection, sewer lines, and streetlights. Once a Mello-Roos District is established, residents must repay the bonds in order to fund ongoing projects. A special tax is assessed to the homeowners and is levied yearly as the repayment method. An ongoing lien attaches to the properties in the District to make sure that the taxes are paid.
 
The duration of the Mello-Roos tax varies from subdivision to subdivision. The average is fifteen years from the original build date; payments very rarely extend beyond 30 years and are usually no shorter than seven years. Depending on the year of construction, the tax can range anywhere from $25 to over $300 per month; the actual tax is usually collected annually or semi-annually with the property tax bill.
 
Mello-Roos is normally found in newer neighborhoods and subdivisions built between 1994 and the present. Mello-Roos often carries a negative connotation, one where the monthly payment for a home will be significantly more than one in a non-Mello-Roos community, but there are both advantages and disadvantages to Mello-Roos Districts.
 
Advantages: New schools, parks, recreation centers, etc., can be built and funded using the revenue generated from the Mello-Roos income; more housing inventory will be created when undeveloped locations are built up; and highly desirable new schools are common in Mello-Roos communities.
 
Disadvantages: The cost of housing may be increased because of the tax, possibly limiting the number of prospective buyers when it comes time for resale; and maintenance of the improvements could turn out to be more costly than anticipated.
 
Prudent buyers should weigh the facts in determining if the amenities warrant an increased monthly payment. Potential buyers looking to purchase a home should inquire as to whether or not Mello-Roos exists in the community. It is the buyer’s choice whether a Mello-Roos assessment is something they can afford.
 
Click here for more information on Mello Roos.

Spectacular New 3BD Listing with Views in Prime Westwood!

by Craig Whitlock

LA Westside Sales Highlights - June 2017

by Craig Whitlock

This report will provide a quick overview as to how the Westside micro-markets are currently performing and then compares that data to the same period a year ago. 

Low inventory, limited choices and bidding wars continue to frustrate buyers in the $2M and below price ranges which drove up pricing in most areas while reducing sales activity across the Westside.  The $2M+ market however has softened relatively speaking where buyers have come to expect more for their dollar and want to see more amenities.  Cheviot Hills and Santa Monica SFR segments had the biggest bump in pricing with 45% on average.  Amazing opportunities for those thinking about selling!   

The key market indicators are:

Pending Sales Activity - sometimes referred to as the 'Number of Properties Under Contract'. This is a forward-looking indicator of current sales activity where there has been an accepted offer and escrow has opened.

Median Sales Price - that point at which half of the properties have sold for a greater amount and half have sold for a lesser amount. This indicator pinpoints where in the price spectrum homes have sold rather than reflecting home value. There is a common misperception that a drop in the MSP directly indicates a drop in home value. It is far more likely that the drop indicates either smaller, older and/or homes in lower-priced areas have sold during the period.

Months Supply of Inventory (MSI) - a leading indicator of market supply, which directly impacts pricing. Generally, a five to six month supply indicates market equilibrium while anything less signals a 'seller's market' and anything above a 'buyer's market'.

LA Westside Sales Highlights - June 2017 © 2010–2017 10K Research and Marketing®

To view a portfolio of three additional reports trended over the past 12 months: Properties For Sale, Days On Market and New Properties For Sale, visit the Market Sales Data section. If you have any questions or would like to discuss this data at greater length, just drop me a note or give me a call.

Slaying Home Buying Myths

by Craig Whitlock

Rental Need to Escalate by the Millions

by Craig Whitlock

Inventory shortages are weighing down just about every housing market, with supply on all sides—renter- and owner-occupied—on a months-long downtrend. A new multifamily report now estimates that by 2030, some 4 million new apartments alone will be needed to keep pace with demand.
 
"Apartment rentals are on the rise, and this trend is expected to continue at least through 2030, which means we'll need millions of new apartments in the U.S. to meet the increased demand," said Cindy Clare, chair of the National Apartment Association (NAA), in a statement on the report, released recently by the NAA and the National Multifamily Housing Council (NMHC).

Meeting demand will require a minimum of 325,000 new apartments, defined as buildings with five or more rental units, built each year—a lofty endeavor, considering only 244,000 apartments were constructed between 2012 and 2016, according to the report.
 
The primary catalysts behind the need are the as-ever delay in home-buying and the formation of new renter households as a result of aging and immigration. One million new renter households, on average, were formed each year over the last five.
 
"Renting is not just for the younger generations anymore," said Dr. Norm Miller, principal at Hoyt Advisory Services, which collaborated with the NAA and the NMHC on the report. "Increasingly, baby boomers and other empty nesters are trading single-family houses for the convenience of rental apartments; in fact, more than half of the net increases in renter households over the past decade came from the 45-plus demographic."
 
Immigrant households, to be sure, will have a deeply transformative effect on both the renter- and owner-occupied housing markets.
 
"Immigration affects rents and home prices far more than it affects the labor market," said Alex Nowrasteh, immigration policy analyst at the Center for Global Liberty and Prosperity at the Cato Institute, at the 2017 REALTORS® Legislative Meetings & Trade Expo in May. Nowrasteh pointed to increases in home values and rents that parallel population growth, much of it spurred by immigrants. 
 
The report finds that demand, though widespread, will be most felt in sought-after markets in the South and West, including Arizona, Georgia and Nevada, and in markets on the East Coast, such as in New York and Virginia.


 "The western U.S. as well as states such as Texas, Florida and North Carolina are expected to have the greatest need for new apartment housing through 2030, although all states will need more apartment housing moving forward," Clare said. "The need is for all types of apartments and at all price points"—affordable stock included.
 
Another recent report out of the National Low Income Housing Coalition (NLIHC) purports an inability for renters in every state, earning minimum wage and working 40 hours each week, to afford a two-bedroom rental, giving way to a shortage of 7.4 million affordable units for low-income renter households. Research by the Joint Center for Housing Studies at Harvard University affirms the need, with roughly 6 million older, low-income renter households, as well, burdened. 
 
"Apartments and their 39 million residents contribute $1.3 trillion to the national economy," said Bob DeWitt, chair of the NMHC.
 
"The growing demand for apartments…will make a significant and positive impact on our nation's economy for years to come."
 
Sources: National Low Income Housing Coalition (NLIHC), National Apartment Association (NAA)/National Multifamily Housing Council (NMHC)

Create Your Own Outdoor Kitchen

by Craig Whitlock

An outdoor kitchen sounds like hours of warm-weather culinary fun. But while most of us would love a sleek, state-of-the-art outdoor kitchen, the price tag may not be doable for all. But that doesn’t mean we can’t cook and eat al fresco! Below are 5 tips for a makeshift version.

Grill upgrade. Skip the outdoor oven or stove for a nice grill. To up the versatility of your grill, consider getting a skillet top or griddle. Pancakes, anyone?

Prep space. To make it possible to prepare food in your outdoor kitchen, set up a prep station with an outdoor butcher’s block or table. If you can, place this station near your grill for ease of use.

Consider installing a sink. If you already have a hose hooked up near your outdoor eating area, it may not cost that much to have a sink installed so you can wash up easy. Hire a professional to get a quote.

Add seating. A large outdoor dining table or small cafe table will turn your DIY kitchen into an eat-in space. Looking for a space to hang? A loveseat and a few comfortable chairs will do the trick. Add an umbrella overhead for sunny days.

 Aesthetics matter. To have an outdoor kitchen that looks, well, like an outdoor kitchen, it’s important to tie your aesthetics together. Installing that outdoor butcher’s block? Choose a wood stain that matches your outdoor eating table. Section off the space with potted plants or slate patio floor so the area is clearly defined. String lights overhead for a magical vibe once the sun sets.

Displaying blog entries 1-10 of 230

Syndication

Categories

Archives

Contact Information

Photo of Craig Whitlock Real Estate
Craig Whitlock
COLDWELL BANKER BRENTWOOD
11661 San Vicente Blvd., 10th Floor
Los Angeles CA 90049
Mobile: (310) 488-4399
Fax: (310) 820-1457

Broker/Agent does not guarantee the accuracy of the square footage, lot size or other information concerning the conditions or features of properties provided by the seller or obtained from Public Records or other sources as presented in this website.  Interested parties are advised to independently verify the accuracy of all information through personal inspection and with appropriate professionals.  Information herein deemed reliable but not guaranteed.

CalBRE LIC 01827537