Skinny On Real Estate

Brentwood: 1626 Old Oak Road- Listed at $4.8M and sold for $6.535M!: This tear-down/major

remodel candidate was in high demand thanks to being located in highly desired Sullivan Canyon and boasting a 28K flat lot. The property had over 10 suitors and sold in an all cash deal.

12251 Castlegate- Listed at $3.650M and sold for $4.826M- $1.2M over list price: This 18K flat lot
was in high demand thanks to being on a cul-de-sac street with views of the Getty, Mt. St. Mary’s and the ocean. The mid-century home that occupies the property will be torn down.

Santa Monica- 428 19th Street sells for $4.8M…$800K over the asking price: This elegant

Mediterranean North of Montana home is a 5+4, 4,460 sq. ft. home situated on a 8,932 sq. ft. lot. The house features soaring ceilings, great natural light, gourmet kitchen, huge master suite overlooking a Jay Griffith designed backyard and pool.

Changes in hot water heater regulations may cause a routine replacement to become an unexpectedly expensive endeavor. New federal regulations aimed at increasing Energy Factor (EF) ratings, require hot water heaters that are larger, more costly and more environmentally conscious than what is required under current regulations.

With these changes, homeowners will face increases in cost between 15 and 35 percent. The new regulations require a more complicated installation and an increased amount of system parts. The larger size of the new units could create an additional unforeseen expense. Electric hot water heaters larger than 55 gallons (the minimum size for most residential units) will require a minimum of 128 cu. ft. with a duct to a larger space in order to comply with these standards.  For many homeowners, that could lead to a major renovation involving construction and a greater cost.

On a positive note, the savings on your utility bill will be around 25% and most tankless water heaters already meet efficiency standards.

The Westside real estate market continues to hum along with the market appreciating at a strong pace in 2015 and overall sales volume up compared to the 1st quarter of 2014. Click the graphic below for access to the Partners Trust statistics page which will provide you with a link to the 1st quarter 2015 report along with the ability to check out reports from the past three years. 

Average long-­term U.S. mortgage rates fell for the fourth straight week, with the 30-­year rate again marking its lowest level since May 2013.

The nationwide average for a 30-­year mortgage slid to 3.63% this week from 3.66% last week. The average for a 15­year mortgage, a popular choice for people who are refinancing, dipped below 3% to 2.98%.

The ongoing decline in rates lured a crop of prospective buyers, as applications for mortgages marked their biggest weekly gain last week in over six years.

Applications jumped 49.1%, the biggest weekly increase since November 2008, according to the Mortgage Bankers Association.

Worries about economic troubles in Europe and Asia have sent mortgage rates plunging despite positive indicators regarding the domestic economy with rising consumer confidence and increases in wages. That strength contrasts with a European economy so fragile that the European Central Bank is expected later to launch a bond­-buying program similar to the stimulus the Federal Reserve employed here as an extraordinary reaction to the Great Recession.

With once ­booming emerging economies from Brazil to China now slowing as well, spooked investors around the world are seeking the haven of ultra­-safe government bonds. The effective annual interest rate on 10-­year securities issued by Germany and Japan has fallen well below 1%, and the yield on 10­-year U.S. Treasury notes dropped below 2% for the first time in three months. With bond investors accepting lower yields on these securities and on the Ginnie Mae bonds backed by Federal Housing Administration and Veterans Administration home loans, mortgage bankers can lower the rates charged to consumers.

Global uncertainty continues to be the friend of the American home-buyer and it should stay that way through most of 2015. Once the Europeon economy starts to stabilize expect rates to begin the climb that has been expected since early last year.

Sources: LA Times, Housing Wire, Fortune

– There is a new addition to the Skinner family! Dax Kenyon Skinner was born December 30th and both he and Jill are healthy and doing well. Here’s a picture from the proud dad.

– Thanks to wonderful clients who continue to provide amazing referrals, we had our best year ever. Despite the lack of inventory plaguing the market, we were able to increase our number of transactions compared to 2013 and we also were involved in six off-market transactions even though off-market activity has also slowed down.

– Price appreciation continued in upward trend on the Westside in 2014 thanks to low inventory, low interest rates, the presence of Silicon Beach expanding its economic footprint and international investors feeling good about the Los Angeles luxury market. Though price appreciation slowed down in the second half of the year compared to the torrid pace of the previous 36 months, demand still outpaced inventory which led to multiple offers on any homes that were listed at an appropriate price. Even though Buyers were desperate for properties, the premiums they were paying above market in the second half of the year decreased with an eye more on value instead of hysteria. Greedy sellers who listed properties over market value were quickly forgotten about.

– Areas that were scorching hot in 2014: 1- Westchester 2- Venice 3- Mar Vista 4- Santa Monica 5- Culver City

 -The same areas that were hot in 2014 will continue that trend in 2015 with Playa Vista also garnering a lot of attention with its newest build-out becoming available. Playa Vista is very popular with the tech-savvy Silicon Beach crowd.

– Unless the national economy goes into a tailspin over dropping oil prices, we expect continued price appreciation in 2015 though not at the prolific clip of prior years. Inventory will still be low in comparison to historical data, but we expect it to increase, providing more options to buyers compared to the past two years. The strong price appreciation of the past three years will entice some sellers to cash out and take advantage of low interest rates on an up-leg property.

– One issue that will continue to contribute to low inventory is seller’s not wanting to lose the property tax basis they currently have on their property. If you purchased a home for $1M, you are paying property taxes on the purchased amount and not today’s value even if today’s value is now $2M. An up-leg purchase for that Seller could be around $3M so the increase in property tax triples. -Partners Trust consistently networks with the most productive agents across the country in upper end markets and those agents are experience many of the same things we are and expect modest appreciation and consistent buyer demand in 2015.

– One of the most desired zip codes on the Westside, 90402 (north of Montana in Santa Monica) is a great example of the shrinking inventory we have experienced the past few years. In 2012, the # of closed sales in the 90402 zip was 122. In 2013, it dropped to 101 and in 2014 it was just 94.

– Housing prices in Los Angeles have grown four times faster than incomes since 2000. Not only is Los Angeles the lease affordable in the nation, but according to a Harvard study, half of all households in the region are considered “cost burdened” and one and four households spend at least half its income on housing.

– LA County has 7 of the 10 ZIP codes with the worst overcrowding in the nation.