Los Angeles Residential Real Estate, It’s Your Time to Buy

Thinking of buying a home in the Los Angeles area? You may not find a better time. But whether you’re a first-time buyer looking to make your dream of home ownership come true or a seasoned investor scouting for profitable deals in the Southland region, understanding the Los Angeles residential real estate market is your first step to buying in the area.

I don’t want to get all rah-rah about it; Southern California’s residential real estate market has taken a huge hit since its peak in 2006. But for those looking for a long-term investment, there are really three great reasons to buy a house in the Los Angeles market now: prices, prices, and prices. The same is true for people looking for a second home, or savvy investors searching for a good market to enter.

Let’s consider all the positives, starting with… housing prices! If you’re looking for a house to buy and live in for the foreseeable future, prices remain excellent. Headed into the summer of 2011, we are definitely in a buyer’s market. Consider this: the house that was selling for close to $600,000 four or five years ago is now on the market for 60% of that price.

The median house price in Los Angeles is now hovering around $320,000. Even though that price is down about 3% from this time last year, that shouldn’t be a factor for buyers looking to purchase long-term residences. The decline in median value has started to level off after its sharp drop of a few years ago, and organizations such as DataQuick, a real estate tracking and reporting company that takes a no-nonsense approach to the market, are pointing to signs that the market may be heading back to normal.

For the long-term buyer, people planning to hold their properties 15, 20, 30 years or more, small fluctuations in the market shouldn’t matter. You can buy a piece of residential real estate in Los Angeles for a great price and, provided you qualify, get an excellent interest rate on your mortgage.

Investors, or those looking to hold properties for the short term, are in a different position, but there are many positive factors for them as well.

As of mid-June, larger investing groups were vitally responsible for helping keep the California and Los Angeles residential real estate markets churning, according to industry reports.

Larger investor organizations were selling distressed properties faster than their bank counterparts, DSNews.com reported, helping to clear up the surplus of inventory that is essential to stabilizing the housing market.

For mom-and-pop investors looking to work with more seasoned third-party investment groups, this presents an excellent opportunity to enter the market with tons of benefits (good prices, experience, end buyers) and minimal downside.

So whatever your intention in purchasing in the Los Angeles market, now is a perfect time to get started!

Tucson Residential Real Estate

Homes across Tucson are selling like hotcakes, thanks to the City’s ideal weather and booming economy.

Now is the time to buy

The prices of the homes sold in Tucson went up by at least 1.5 percent. This is great news for investors looking to cash in on profits, but this is crippling to potential buyers. Since the uptrend will probably grow steadily in the coming years, now may be the best time to buy Tucson residential real estate – while most houses are still relatively affordable. The best places to look at include the Catalina Foothills, Continental Ranch, Northwest and West Tucson, Sahaurita, the surrounding Pima County, Oro Valley, and Dove Mountain, among many others. If you are looking for adult communities, then try the Heritage Highlands, Saddlebrook, and Sun City Vistoso.

Why Tucson

The charm of Tucson lies in its ability to mix the old with the new. While it is becoming an increasingly progressive city and one of the fastest-growing urban areas in the United States, both its government and residents are still able to successfully preserve its old Western history and at the same time protect its natural environment.

Tucson is also a very warm place, literally. In fact, the temperature sometimes reaches 110 degrees and higher. People who hate the cold will also appreciate just how dry the Tucson weather is. Tucson population is now pushing 1 million, and it continues to grow.

Still affordable

The price of properties in Tucson continues to increase, but the sustained lower interest rate program is keeping the Tucson real estate market in the pink of health. People are still very much intrigued by and attracted to the lifestyle associated with Tucson, and this factor helps stabilize pricing.

Residential Real Estate Market – Some Cities Are No Where Near a Recovery

Although, it doesn’t look like the United States economy will go into a double dip recession, many might conclude that the residential real estate market actually has already. Normally, when real estate recovers it helps the overall economy recover and thus is one of the economic indicators showing that the recovery is moving forward. Unfortunately, that didn’t happen this time, and no new construction jobs were created, as has been the case during past economic recoveries.

California had some counties that were hit extremely hard, for instance Riverside County, which had foreclosure rates that were very near that of South Florida, Las Vegas Area, or Phoenix AZ area. It grew extremely fast, and many people bought new track homes at the top of the market for much more than they could afford to spend, and then with all the job losses, there was no way for them to make their payments. Meanwhile the homes they bought lost 40% in value, some almost 60% if you can believe that.

Not long ago, I talked to an acquaintance who is currently unemployed in Riverside County, but has gone back to school to get a degree so that he can personally financially recover from this tragic economic occurrence. He lives in a very nice suburban community of Marino Valley. When he explained this to me I told him;

“I know Moreno Valley, it’s nice there but with the recession, it sure hurt real estate prices there, what a bummer, one of the worst areas hit in the US actually, mostly because it grew so fast, but all those middle class tract-homes they built are very nice, how is the neighborhood now, I worry about the gangs and crime moving in now?”

Indeed, I asked him if it was very bad, with the gangs, violence, and crime. He said there was some crime, but then the very next day I read in the newspaper that a teen aged girl, only 17 years old, was shot in front of a friend’s house where she attended a party in that city. She was able to drive her car away, but was bleeding very badly, and started screaming for help in the middle of someone else’s neighborhood. They called the paramedics, took her to the hospital, but she died.

It has often been said that the crime rate increases 2.5% for every 1% increase in foreclosures. During this last real estate crash, those numbers did not seem to jive with the past FBI data. However, maybe all of that data is now catching up with this reality. And it still looks as if the residential real estate market in these suburban areas such as Marino Valley may not come close to recovery for at least three years, but most likely five more. That would be over eight years total, just to get back to where things were.

Much of California goes through a ten-year residential real estate cycle for valuations, and it appears that this cycle may be somewhat longer either due to government economic policy, or just the reality of the size of the bubble that burst in late 2008. Indeed hope you will please consider all this and think on it.

The Residential Real Estate Appraisal – Making Sense of the Residential Real Estate Appraisal Report

Residential real estate appraisal reports can be very complex documents filled with extensive market data and documented procedures for estimating value. For the novice, as well as the seasoned real estate professional, the reports can be difficult to understand, and most users simply look for the statement of value.

The residential real estate appraisal report is merely a tool used by various parties to assist in a real estate transaction. Valuations of residential real estate are conducted using similar methods, regardless of the type of property or who employs the appraiser. Appraisers work in areas they are familiar with so they should have a working knowledge of any environmental or other concerns that may affect the value of a property.

Residential real estate appraisal reports will note any unique characteristics of the property and of the surrounding area, such as a specific architectural style of a property or a major highway located adjacent to the parcel. They also take into account additional aspects of a property like the condition of the roof and any renovations that may have been completed.

After visiting the property, the appraiser will determine the fair value of the property by taking into consideration such things as comparable home sales, location, and previous appraisals. All of the research and observations will be compiled in a detailed report, which states not only the value of the parcel, but the precise reasoning and methodology of how the estimate was derived.

A residential real estate appraisal report should include the following:

o An explanation of the purpose of the report.

o The valuation method used in the report.

o A detailed description of the property.

o A statement that the appraiser has no financial interest in the subject property.

o The appraiser’s qualifications and signature.

Each part of the report plays a role in assisting the user’s understanding of the final valuation of residential real estate. Appraisal is an art, not a science. But there is one section of the appraisal report that draws significant attention. It is the section that describes the most likely approach utilized to determine an estimated value – the market comparison approach.

This approach is based on recent sales prices of comparable properties. Information is collected on recent sales of properties similar to the subject property. The appraiser will search for similar properties; however, comparable properties will not be identical to the subject property, so there will be a valuation adjustment.

If the comparables have superior characteristics compared to the subject property, a downward adjustment is made to the valuation of the subject property. If the comparables have inferior characteristics compared to the subject property, an upward adjustment is made to the valuation of the subject property. Utilizing all of the market data, the appraiser will determine a final valuation for the subject property.

The residential real estate appraisal report is a critical report for the homebuyer to understand. It is an important tool in any real estate transaction, so make sure that you spend the time to clearly read and understand the report.

During your examination, please remember – there are often errors in the report that can significantly impact any final valuation. Accordingly, your goal is to uncover any errors before it is too late.

Four Great Tips When Buying Residential Real Estate

Buying that dream home can be incredibly rewarding. However, if you don’t go into it educated and knowledgeable, you might just find that your experience is less than stellar. What should you know about buying residential real estate? Here are four of the most important tips any would-be homeowner should know prior to buying any home (or even starting the search for a home).

Get Your Insurance First

Most homeowners know that having home insurance is a requirement. However, few understand that insurance coverage needs to be in place before you can get a loan from most lenders. While you won’t need insurance prior to starting a house hunt, you will need to have a policy in place before you can finalize the purchase. That means you need to find a good insurance company with which to place your policy before you begin your home search. Having this information beforehand will help fast track the process of buying a home.

Heating And Cooling System

Having a good HVAC system is imperative – your comfort and even the health of your bank account depend on it. However, many homeowners don’t know enough about the heating and air system in the homes they want to purchase to make sure that it’s in good condition, and that it won’t cause exorbitant energy bills. Have the HVAC system professionally inspected (as part of your home inspection) prior to finalizing your purchase. Doing otherwise can cost you an immense amount of money in repairs and replacement costs.

Energy Efficiency

Energy efficiency is an incredibly important consideration and one that covers a wide range of areas. The energy efficiency of any home relies on the level of insulation, the efficiency of the home’s windows and even the type of exterior siding on the home in question. Make sure that the R-value of the home’s insulation is satisfactory, that the windows are highly efficient and that the exterior siding adds insulation to the home as well. It’s imperative when buying residential real estate that you work with a home inspector who will check all of these areas and give you accurate, immediate feedback.

Use A Home Inspector

A home inspection is more than just a good idea – it’s an essential part of ensuring that the home you want to buy is in good condition and that there are not hidden costs lurking to strike when you least expect it. Of course, not all home inspectors are worth your time, and it can be very difficult for a home buyer to tell if one inspector is better than another. Your real estate agent should be able to give you information on the top area inspectors. Chances are good that he or she has a preferred inspector they use for most of their sales, and listening to your real estate agent’s advice is a very wise decision.

With the information above, you can buy a new home with a bit more peace of mind about your investment.