31. October 2007 by Burbank Real Estate.

If you are a buyer in Los Angeles, then you are in the driver’s seat. According to a report compiled by ZipRealty, Los Angeles is at the top of the list of cities with the biggest housing inventories.

Here is a list of the 10 U.S. cities with the highest housing inventories as of September 2007 and the percentage of homes currently listed on the market whose listing price has been reduced as of Sept. 30.

Top 10 Cities With Highest Housing Inventories City # of Homes for Sale % of homes with price reductions

•  Los Angeles: 111,269               45.9
• Chicago:           82,839              40.8
• Miami:              79,154              38.1
• Tampa:             58,601              42.3
• Phoenix:           54,536              47.1
• Washington:     52,854              46.8
• Dallas:              47,097              35.9
• Boston:             43,158              48.4
• Sacramento:    40,195               51.4
• Houston:           39,332              36.7

What this means to you is that you have many more choices and you have more flexibility to negotiate terms with home sellers. As long as you are pre-approved for a loan and have your financial house in order, you, through your agent, are free to submit offers on homes that fit your criteria and loan approval level.

Keep in mind, however, that home sellers, in many cases, are not desperate and you may negotiate yourself out of a sale. As long as you are reasonable and are working with a knowledgeable real estate agent you should be able to find your dream home for a good price.

If you are a seller, make sure you are being realistic with your asking price. Work with your agent and make sure you are informed as to what the comparables in the area have sold for and what current comparables are priced at. I would also recommend that you have a home inspection before you get an offer so you know what repairs or issues may come up. An unexpected major repair surprise in the middle of escrow is not fun for either the buyer or the seller.

As the seller you need to have a plan as to how you will handle repair issues and price reductions, before you you get an offer. The process of selling your home can be emotional and addressing these concerns ahead of time helps eliminate some of the emotional component and stress that comes with it. Because there are many homes on the market right now, proper pricing is the number one reason that homes are selling. Second is presentation. If a home in the same neighborhood with the same square footage has nicer landscaping and looks better inside, buyers will probably consider that home first. Your agent should be able to advise you on what improvements or staging ideas to implement before you put your home for sale. Lastly, the market value of your home is whatever buyers are willing to pay for it. Know going into the process of selling your home what your time frame is and how much money you need to get out of the sale.

If you don’t have to sell your home and are not willing to negotiate, waiting may be the best course of action for you.

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28. October 2007 by Burbank Real Estate.

We don’t have a very heavy agenda this week, but there were items of interest both for last week’s and the upcoming agenda.

Items of Note:

Last week the Burbank City Council approved the parking amendment for multifamily dwellings.

This week the Council will look at the Rancho Amendment again, following up from the September 11th meeting. This time the text has been changed to make grocery stores a prohibited use in the Rancho commercial zones as opposed to just requiring a conditional use permit for the stores to operate.

The Burbank City Council will be meeting Tuesday at 6pm in the Burbank City Hall Council Chambers.

Remember that you can watch the City Council meetings live on Charter Communications Channel 6 or online at City of Burbank’s website.

If you are interested in reading the actual Burbank City Council agendas, please visit the City of Burbank website, City Council Activities!

Have a great week!

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26. October 2007 by Burbank Real Estate.

Stocks rallied today with Microsoft’s blowout earnings announcement, their fiscal first quarter earnings beat expectations by more than $1 billion and Countrywide’s upbeat profit forecast for the future.

Overall, it was another turbulent week with rumors swinging the market every which way. Rumors that the Fed will lower interest rates again when they meet next week, that AIG will have a very large write down etc.

Items of note for the week:

Merrill Lynch wrote down a whopping $7.9 billion of subprime and collateralized debt obligations, this was $3.4 billion dollars ABOVE their October 5th estimate! They reported a $2.24 billion dollar loss as compared to last year’s $3.05 billion dollar profit. Needless to say, the subprime debacle continues to spread.

New Homes Sales, which were expected to come in at 770k(representing a 3.1% decline from August)came in at this number but the headline read it as a 4.8% increase as the August number, which was originally reported as 795k was revised to 735k. Confusing? A little but the revision made the September number look great, even though it came in as expected…….assuming no revisions.

Existing Homes Sales fell 8% to an annualized 5.04M. This is the slowest pace since the National Association of Realtors started reporting on this figure in 1999! The year to year decline is at 19.1%.

Housing Inventories for September were at a 10.5 month supply, the highest level since 1999.

Median price of a home fell to $211,700The number was not much of a surprise, but keep in mind that this number only accounts for closings, not sales so you can probably expect next month’s number to look even worse.

Countrywide posted a third quarter net loss, as expected, at $1.2 billion or $2.85 per share and maintained it’s dividend.

Jobless Claims came in at 331k representing a second straight week of higher claim numbers.

Oil closed the week at a record high of $91.86

On the mortgage side, the 2-year note is 3.81%, the 5-year at 4.04%, and the 10-year ended at 4.45%. The fact that treasury yields are staying low tells us that investor dollars are still going towards quality.

Anticipation of a Fed rate cut next week will dominate next week’s trading. Although with the dollar getting pounded, oil at record highs and more liquidity in the markets, the case for a rate hike is becoming less viable. Some were anticipating a 50 basis point cut, but I think either a Fed on the sidelines or a 25 basis point cut are more likely.

Posted in Housing Information/Stats, Economic Market Reports, Blogroll | Print | 1 Comment »

26. October 2007 by Burbank Real Estate.

Existing Home Sales (September) 5.05M -8%, compared to the 5.48M revised number for August, sales are 19.1% below the 6.23M pace in September 2006

Pending Homes Sales Index (August) 85.5 -6.5%

New Home Sales Index (August) The September numbers, which were expected to come in at 770k(representing a 3.1% decline from August)came in at this number. The headlines reported it as a 4.8% increase oly because the August number, which was originally reported as 795k was revised to 735k. Yes, just a bit confusing!

Basically the number came in as expected but because the August numbers were revised downward, the September number looked better than it actually was.

Housing Starts (September) 1191m -10.2%, year to year they are down 30.8%

Housing Affordability (August) 106.1 up 2.4%

Housing Supplies Inventory is at 10.5 month supply which is the largest since 1999.

Nationally existing home prices dropped 4.2%, the median price is at $211,700.

Although this information has been obtained from sources which we believe to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed.

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26. October 2007 by Burbank Real Estate.

This is the first post in a series that looks at the current and past real estate market cycles.

The current cycle is starting to look somewhat like a 12 step program:

Step 1-Awareness of the subprime problem in late 2006

Step 2-Credit markets froze in July of 2007, which forced the Federal Reserve to step in.

Step 3-Losses start to hit at Citibank, Bank of America, Merrill Lynch and many others.

Step 4-Yet to come, but could be worst of it, accentuated by job losses, lower retail sales and housing foreclosures.

Step 5-12 Recovery?

Steps 4 and 5-12 are based on some speculation, but I think these might be close to the mark, at least at a national level. Keep in mind that local real estate markets will always behave somewhat differently depending on their demographics, local economies, availability and affordability of homes, just to name a few important factors.

In looking back at this last cycle it’s apparent that “easy” money, questionable loan practices, a friendly interest rate environment, little oversight and finally greed were the main culprits. This set of ingredients helped fuel the feeding frenzy for housing, not just by folks who should not have been buying from an affordability perspective, but also the many investors who took advantage of these circumstances in order to “flip” properties.

What we need to remember is that real estate is a cyclical industry and in hindsight I think we should have viewed the “flipping” craze that came at warp speed as a sign of the market top. The amount of zero down, no doc loans might have been a sign as well! Before my entry into real estate I had a 15 year career in the stock market arena, and I learned that you never try to time the market and that many businesses and industries are cyclical. Because real estate is not a liquid asset you won’t see the day to day gyrations of the stock market, but you will experience the cyclic nature if you own your home long enough.

So if you are in it for the long haul and are looking to buy your family’s “home” this could turn out to be the optimum time to buy in the coming months. We only see the recovery as we look back in hindsight, but keep in mind that, as a buyer, you have the following factors in your court:

• Historically low interest rates.

• Discounted housing prices, steep discounts in some areas.

• Inventories are at a 10.5 month supply level, which is the highest since 1999!

• Sellers are more open to negotiation if you are the only one at the table with them.

Remember that when things pick up there will be a whole lot of buyers jumping in with you. At the very least, make sure your financial house is in order and that you are talking to both a mortgage and real estate professional to help you make the right decision for your circumstances.

Posted in Seller Information, Buyer Information, Housing Information/Stats, Blogroll | Print | No Comments »