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A Double Dip in the Los Angeles Housing Market?

There’s a lot of talk right now about the real estate market heading toward a “double dip” -a reference to housing prices continuing to deteriorate. The latest read on home prices, released Tuesday morning, shows fresh declines in the vast majority of the nation’s largest metropolitan areas, according to a story in the Los Angeles Times.

See: http://latimesblogs.latimes.com/money_co/2011/01/home-prices-declined-in-november.html

The coastal cities of California and the nation’s capital were the only apparent bright spots in a November report, said the L.A. Times. In November, only four metro areas — Los Angeles, San Diego, San Francisco and Washington, D.C. — showed year-over-year gains. Every city declined from October to November besides San Diego, which eked out a 0.1% gain.

However, the performance of the California cities in the index doesn’t reflect the state’s hardest hit markets in the Inland Empire and Central Valley.

But what are real estate agents seeing on the ground here in the greater Los Angeles area? Even though we are a supposed “bright spot” in the nation, are we headed for the dreaded double dip?
“Double dip…I don’t think it’s really a double dip,” said Mike Ace, a Rodeo Realty agent who works out of the company’s Sherman Oaks office. “A lot of it is seasonal. In fact, I just took another listing today.”
Ace said buyers and sellers pay close attention to the news. But every time they show him an article about the real estate market, he asks them whether the article quotes local or national numbers. Real estate in the San Fernando Valley is very different than other parts of the country, he said, and each neighborhood is unique.
“People aren’t rushing to get out of the Valley,” he said. “Interest rates have risen a little bit, but that was to be expected. They’re still less than 5%. I think it’s an unbelievable time to either buy or sell.” Ace is also looking forward to activity picking up in the Spring.
“There’s not a lot of buyer confidence right now,” said Sheila Milano, a broker with Rodeo’s Westlake Village office. She is currently working with many clients in the $400K-$700K category. “Buyers are still guarded because they’re not sure where the market is going.”
She anticipates home prices will continue to decline in some local markets. The large number of short sales and bank owned properties are a big factor preventing home prices from rebounding, she said, adding eight out of every 10 homes on the market is a short sale. High unemployment is also an issue.
The upper-end home market is bound to see further price reductions, said Milano, adding lenders need to figure out more options for the self-employed. There’s also a need for more conventional listings to hit the market in all price categories.
That said, Milano had one of her busiest years in 2010. And she’s optimistic about the future. “If interest rates stay low, we’re going to start seeing more activity in the Spring.”

David and Michelle Cohan of Rodeo’s Calabasas office have been reading a lot about the impact of the apparent “double dip,” but have not seen a significant hit to their business.
“As a matter of fact, since Thanksgiving, our business has actually improved, making the last half of the 4th quarter 2010 and beginning of the 1st quarter of 2011 better than the previous year,” said David. 

“The identified national drop in housing prices may be lagging behind the dips we’ve already experienced, and we may already be feeling the positive impact of the improved market.”

The Cohans certainly felt a hit in both 2009 and early 2010, as the “first time buyer credit” expired. But lately, their sellers have gotten more realistic about the remaining weak real estate market and buyers (and buyers on their listings) seem to have done a better job of qualifying.

The couple remains optimistic that 2011 will continue to get better so long as the economy continues to recover and unemployment numbers continue to drop.

Encino agent Carol Wolfe believes home prices will continue to drop, but the term “double dip,” at least locally, may be a little strong. The drop is likely not going to be as dramatic as when the housing market first crashed, she said.
Echoing Milano’s statements, Wolfe said home prices continue to decline because there are so many short sales and foreclosures on the market that are competing with conventional sellers.
“When you look at the MLS at any price point, about 40 percent of the sales are foreclosures and short sales,” she said. “A lot will depend on how many more of these types of properties come to market. I talk with people daily who are upside down or in default.”  
On the bright side, Wolfe said homes continue to sell and mortgage rates remain low. 
“It’s a good time to buy,” she said, adding especially for those looking to move up. “You can never predict the precise moment of a market hitting bottom.” Wolfe also encourages most people to buy for the long-term, rather than for what the house might be worth next year.
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Carlos Pena Jr. Buys Home in the Valley

Actor and singer Carlos Pena Jr. recently purchased a Mediterranean-style home in the San Fernando Valley listed by Rodeo Realty agent Carol Wolfe. Pena is probably best known for being in the pop music band “Big Time Rush,” and playing the character Carlos Garcia on the Nickelodeon series “Big Time Rush.”

To learn more about Carlos Pena Jr. visit:  http://bigtimerush.spruz.com/pt/Carlos-Pena-Jr/blog.htm

The approx. 6,000 square foot, five bedroom, four bath villa sold for close to the asking price of $1.5 million. Andrew Mortaza from Keller Williams represented the buyer.
The deal was featured in the Los Angeles Times Hot Properties section today. To view the story visit:

The home is set back from the road on a gated private lot. It has paver-stoned courtyard with fountain. The custom front door, which has leaded and beveled glass and side lights, opens to a two story foyer with limestone floors, a curved staircase and crystal chandelier.

The master suite has a marble fireplace with wood carved mantle and French doors that open onto a balcony. The master bath has dual vanities, dual dressing tables, an oversized marble steam shower with art designed etched glass and multiple shower heads, and a stone fireplace.
The gourmet kitchen includes a large center island with food prep sink, paver-tile floors, custom cabinets, Wolf commercial range with oven, Wolf barbecue, Traulsen refrigerator and freezers, Gaggenau ovens, and warming drawer. The home also includes a wine cellar, landscaped grounds, pool, spa, and pool house.
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Carmen Mormino Lands Role on CSI

(UPDATE) Actor and real estate agent, Carmen Mormino, recently booked a spot on the hit television show CSI. Attesting to his earlier statements in a Rodeo Realty Journal article about how acting and real estate compliment one another, the Westlake Village agent landed the CSI role as a result of showing a piece of property.

In brief, he met a really nice couple while showing a home a year or so ago. He kept in touch with them. When it came time for the couple to sell their house, they contacted Mormino about possibly co-listing it. At that time, Mormino discovered the gentleman is a director. The director discovered Mormino is an actor with a long list of credits.
The relationship led to Mormino being offered the opportunity to read for the CSI part. He nailed it! Moral of the story: Keep in contact with your clients, past clients and potential clients.
Here’s the original story about Carmem Mormino
The entertainment industry and real estate seem to go hand-in-hand. Gossip about celebrities buying and selling multi-million dollar homes are staples of the L.A. Times, New York Times, Huffington Post and more.
But what about real estate agents who are also working in the entertainment business? Columnist Lauren Beale of the L.A. Times recently did an article on the subject, so I decided to look into whether or not we have “industry” folk working among us right here at Rodeo Realty.
The answer is yes we do, and this is the first in a series of blogs interviewing them. Some are actors, others musicians. Regardless, all of them say there are plenty of parallels between show business and the business of buying and selling homes.
“In my 21 years as an actor and more than 1,200 auditions, rejection means absolutely nothing to me,” said Carmen Mormino of the Westlake Village office. He has acted on “Days of Our Lives,” and “Grey’s Anatomy,” among other television shows. He has also appeared in movies such as “The Stepfather” and “One Hour Photo.”
Actors hear so many “No’s” that sometimes they start believing it, he said. But like in real estate you can’t let rejection get you down. You have to go right back out there and meet more people until something clicks and deals get done.
Actors also have to think outside of the box in order to land certain roles, said Mormino, who began his real estate career four years ago and was on Rodeo’s list of top producers for the month of October 2010.
You can’t just play a character as you think it should be played; you have to live it and be real, he said. You also have to be real in order for real estate clients to trust you. “Acting has given me the confidence to be myself,” said Mormino.
Real estate is also not just a side gig. He has a family and said that balancing acting and real estate is the best way to maintain consistent income. He enjoys the thrill of helping people buy and sell homes and is proud to call himself both an actor and real estate agent.
Every now and then, however, the two careers meet in strange ways, said Mormino. He recently met somebody at an open house who happened to be a well-known television director. There was a point of connection, because the director knew Mormino is also in the entertainment business.
A colleague’s sister is a huge “Days of Our Lives” fan. So when she found out about Mormino’s recurring role on the show, she called her sister right away. Mormino –knowing the value of good fan and client relations- set his colleague’s sister up with some much appreciated Days of Our Lives memorabilia.
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Todd Jones, the Cast of "Glee" and Fifth Grade Elementary School Students

Todd Jones of Rodeo Realty’s Studio City office recently got his first byline in a local newspaper, The Studio City – Sherman Oaks – Encino NEWS! The whole story he wrote is below. (Note: I tried to link Facebook directly to the article, but it gave me problems -hence the cut and paste job.) To view the newspaper’s original, visit:
http://shermanoaksstudiocitynews.com/archives/2011/Jan_2011_ShermanOaksStudioCity_Encino_news.pdf
Very cool stuff!

Rio Vista’s Fifth Grade Music Students Experience Glee
By Todd Jones
Rio Vista Elementary’s fifth grade guitar students got a special treat in December with a very unique field trip. It wasn’t to a museum, or an aquarium, or the science center, they took a trip to Paramount Studios where they interacted and performed with the cast of the hit TV show “Glee.”

(L.) Chris Colfer Matthew Morrison (C) and the Rio Vista students construct instruments
Photo courtesy of Rachel Sanchez

Rio Vista Elementary was the happy recipient of a guitar and recorder class provided by a non-profit called Education Through Music-Los Angeles (ETMLA). Every week this non-profit teaches children in select schools the basics of music. Their mission is that each student “deserves a well-rounded education…one that includes music.”

All the teachers and instruments are provided by ETMLA at no cost to the school and their presence fills a growing void in the ever shrinking budget of the LAUSD. The field trip was hosted by Members Project® from American Express and FOX’s “Glee” cast. The students made toy guitars, shakers, and tambourines with cast members Matthew Morrison (Mr. Schuester), Mark Salling (Puck), Jenna Ushkowitz (Tina Chang), Chris Colfer (Kurt Hummel), Cory Monteith (Finn Hudson), Harry Shum, Jr.,

and Jayma Mays (Emma Pillsbury).

After making crafts, the “Glee” cast members became the audience as the fifth graders rocked out with Journey’s “Don’t Stop Believin’.” In true “Glee” style, they had a choreographed routine where the guitar students were sitting on desks while the other students sang. One student even stood on a desk for a little electric guitar solo.

The “Glee” cast enjoyed their role as an audience rather than the usual one as performer; and the fifth graders certainly seemed to have a good time. The finale didn’t belong to the fifth graders, however, but rather to American Express and the Fox/”Glee” team who presented ETMLA with a $100,000 check to further their mission of bringing music to students in under-funded schools, so that children’s lives will continue to be enriched by music. It was truly a day to remember for students and actors alike.

Todd Jones is a local Realtor and father of two boys at Rio Vista Elementary, which is located in Studio City and serves the children of Studio City, Toluca Lake, and North Hollywood.

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Todd Bernstein Highlighted for Work with Habitat for Humanity

The chairman of Habitat for Humanity San Fernando/Santa Clarita Valleys recently presented Woodland Hills agent Todd Bernstein with a proclamation from the City of Los Angeles. The proclamation recognizes Bernstein’s work for the non-profit organization that provides homes for families in need.

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Professional vs. Amateur Photos of Real Estate Agents

It’s ironic, because there are real estate professionals out there who are camera shy.

They are marketing geniuses who can sell a client’s home for a profit in the worst of times, and help clients buy homes for a steal in the best of times. Yet they post sub-par images of themselves on professional social networking sites and marketing material.

So just for fun, and using myself as an example, I want to talk about the difference between amateur and professional personal photos. 


Professional photo

  



Amateur photo

  

The photo on the left was taken by a friend on a decent quality digital camera. Cost: Free. Many professionals, even high-level executives in real estate and other businesses, only have this type of image on file.

The one on the right is a professional shot. About a year ago, I spent a couple hours with a fashion photographer. I wanted images that were different from those taken by portrait studios, and ones that could be used for professional and social networking purposes.

Cost: $200 for five different shots in different locations. This is just one.

Now if you were looking to sell your multi-million dollar home, which photo is a better piece of marketing material for the agent? (Just to be clear, I am not a real estate agent. I am just using my photos as examples.)

Personally, I think the professional shot is better. It shows the agent invested in quality versus settling for convenience.

You might be one of those people who relies on “friend shots,” and ticked off at this subject right about now. But the point is not to knock your value as a real estate agent. You might just be camera shy and have overlooked upgrading your personal photos.

Ironically, I’m a publicist who did the same thing for a long time. One day a friend recommended paying for a formal photo shoot. I agreed and was blown away by the results. The photographer brought out multiple sides to my look, personality and professionalism that I never expected.

Those photos have more than paid for themselves.

Investing in quality photos is a way to put your best foot forward in everything from marketing a home to marketing yourself. And one of these days you might be interviewed by a local newspaper about the real estate industry. Wouldn’t it be nice to send the reporter a photo that shines?

By Eric Billingsley

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Ollie Brown, Stevie Wonder, the Rolling Stones and Real Estate

A bit of trivia for all you Gen Xers: What is the name of the pop music duo who made the hit song “There’s No Stopping Us,” title track for the 1984 dance movie Breakin’. Answer: Ollie & Jerry, the “Ollie” of whom is Rodeo Realty’s own Ollie Brown.
“We wrote that song in one day and dropped the record in two days, ” said Brown, a real estate agent with Rodeo’s Northridge office. “It happened so fast, we didn’t even have a name for the group so we just called ourselves Ollie & Jerry.”
Brown is still collecting royalties on that stroke of genius. “The song has definitely helped me through the ups and downs of the real estate business,” he said.
But “There’s No Stopping Us” is just one blip in Brown’s extensive musical career. He worked for many years as a record producer, and has played percussion for some of the biggest names in the music industry. And he said there are plenty of parallels between the music biz and real estate.
Prior to getting into real estate a decade or so ago, Brown was a senior vice president for a record label known as CLICK Records. The label signed notables such as the soul music vocal group The Spinners and pop music band The Association. Brown still does a bit of artist management on the side.
As a percussionist, one of his big breaks was working as Stevie Wonder’s drummer back in 1972 (See video below of Ollie on drums – Amazing!). During that time period, Wonder was opening for the Rolling Stones.
Then he was a percussionist with the Stone’s during 1975-1976. Mick Jagger and crew even had dinner at Brown’s mother’s house in Detroit, Michigan.
“They still my boys,” said Brown about The Rolling Stones. He went on to record with some of the best rock and soul artists of the time. He continues to do live performances with guitarist, songwriter and producer Ray Parker Jr.
Brown has carved a niche for himself in the real estate business working with celebrity clients. Making it in real estate is similar to cutting a record deal, he said. You have to market the heck out of the product, think outside of the box and not be “regular,” and work with each home as if it were a new artist.
Celebrities respect Brown’s track record in the entertainment business and understanding of how things work. “If I’m taking out a producer, he might get a call to go into the studio (or movie set) right in the middle of a showing,” said Brown. “I understand their flow. Been there, done that.” 
Ollie’s contact info: (818) 363-7945, ollie@olliewoodestates.com  

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The Not-So-Obvious Mortgage Deal Killers

Since the economy tanked, it’s no secret banks have tightened their lending standards. Borrowers need to at least have good credit, down payment and a stable job to buy a home -a far cry from the easy money days of the real estate bubble. And that’s still no guarantee they’ll get financing.

So if a borrower has all of the above, what else could go wrong to prevent lenders from forking over the money for a home? I recently sat down with Arin Crews of L.A. Mortgage to discuss the issue. She brought up a few key red flags that she’s seeing slow down or kill deals altogether.

1. Buyers and Sellers are rushing deals. In this day and age of short sales and foreclosure sales, some buyers and real estate agents aren’t taking the time to learn about home’s major maintenance issues. And the fact is sellers aren’t always willing to pay for such repairs when push comes to shove.

Even though a buyer and seller have agreed on a sales price, lenders may back out of the deal at the last minute if issues like termites, foundation work, and others have not been addressed. Crews encourages agents and buyers to slow down and do as much homework as possible before getting too far into the deal.

2. Appraisals are coming in low. It’s still hard to tell if the residential real estate market has hit bottom in many locations. So appraisers are covering their bases, and those of lenders, by giving very conservative prices for homes. And the fact is lenders are not going to provide financing for more than the appraised price. Real estate agents should also familiarize themselves with the Home Valuation Code of Conduct.

3. Self-employed borrowers are having to prove long-term revenue. Some self-employed folks took a significant financial hit when the economy soured. Fortunately some of those same folks have rebounded and are in the market for a home.

But lenders generally look at finances over a couple year period of time. So somebody who is self employed may be making money hand over fist today and still get declined for a loan if his/her 2009 or 2008 revenues were down.

Crews said some lenders may be more lenient than others if an accountant can help show that the borrower’s other finances are in line.

4. Condominium HOAs need to be in the clear. Many lenders will not finance condo purchases in developments where the homeowners association has pending litigation.

Some of Rodeo Realty’s agents found a  niche last year selling only new construction condos. Sales were strong because builders have been liquidating condos, the HOAs are clean with no defaults, and the new developments are FHA approved.

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Real Estate Agent Quotes About 2010 and the New Year

This will be the last blog entry for 2010. So it seemed fitting to ask a handful of our real estate agents about the past year and what they envision for 2011.

Kittean Little – Beverly Hills

“I felt 2010 was surprisingly brisk. I represent a lot of high net worth individuals, (entertainment) industry clientele and investors. I noticed a lot of these people were re-entering the marketplace. If we haven’t reached the bottom, we’re pretty close to it. In 2011, if you have money buy a house, because by 2012 and 2013 you’ll look back and wish you had.”

Brian Stevens – Studio City
“2010 was the best year ever. It was off-the-hook”

Scott Sorrentino – Calabasas and Studio City

“2011 will be a far superior year than 2010. Consumer confidence is likely to grow and trickle into the real estate market.”

Bud Mauro – Northridge
“In 2010, as in 2008 & 2009, I think most REALTORS®, were expecting the market to make a come-back; to rebound, even just a little. Something to build up some confidence in the minds of the novice Buyers. It just didn’t happen.

Of course, the seasoned veteran Buyers didn’t have that problem. The “veterans” were buying Short Sales and REO’s with 50% cash down, and in many cases, all cash. Veterans “know a deal” when they see it. The novice Buyer, not understanding the current market and fearful of market stability always seems to want to “low-ball” the Listed Price. By the time they get the message that home has gone to a veteran Buyer.

The Sellers in the 2010 market had adjusted to the current market values. They had a need to sell and respected their REALTORS® opinion of market value. The novice Buyer was not comfortable with values, whatever the price. All in all, the real estate value of average priced homes stayed quite level in 2010. Some showing a slight increase (maybe around 2%), while the higher end properties showed significant price reductions.

The market was haunted all year long by the threat of the foreclosures still to come (Shadow Inventory). That hasn’t happened. Inventory is still low. NOD filings have lessened for the time being. The threat of an over abundance of foreclosed properties is still in the mix. When they will “hit” the market is a mystery.

2011 should be a very interesting year. Buyers should not put off getting into a home. Home prices and Interest rates are just too good to pass up. There may not be another opportunity such as the current market prices for years to come. Think about it. We never saw this downturn coming and we won’t see the turnaround market until it is too late.” 
Ben Salem – Sherman Oaks
“(2010) has been an incredible year for me and my most successful to date. However, those successes do not come by accident. Market shifts have created new challenges for our industry, and with the help of a fantastic team we’ve put a great deal of effort into how we respond to those challenges.”

Carol Otero – Northridge

“2010 was the best move in my 20 years in real estate (She joined Rodeo Realty mid-year from another real estate firm). I doubled my income from the first six months of the year. The support at Rodeo is beyond belief; I have never had more people help me do what I need to do.”
Roger Perry – Beverly Hills
“I’m hopeful for the New Year! People just need to wake up and take advantage of the low interest rates and low asking prices. I plan on working hard in 2011.”
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Los Angeles Home Prices Faring Better Than Other Major Cities

The nation’s housing market may be headed towards a “double dip” slump, according to a press release from Standard & Poors. The good news is home prices in Los Angeles seem to be faring better than many other major cities in the U.S.

The S&P/Case-Shiller Home Price Indices showed home prices fell in 20 major cities in October 2010 compared to September 2010. The overall decline for the 20-City Composite was 1.3 percent. It was 1.2 percent for the 10-City Composite. Los Angeles posted a -0.7 percent drop, the fourth smallest drop of the 20 cities.

To view the full press release visit: http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff–p-us—-

“The double-dip is almost here, as six cities set new lows for the period since the 2006 peaks. There is no good news in October’s report. Home prices across the country continue to fall,” said David M. Blitzer, chairman of the Index Committee at Standard & Poor’s.

“The trends we have seen over the past few months have not changed,” he added. “The tax incentives are over and the national economy remained lackluster in October, the month covered by these data. Existing homes sales and housing starts have been reported for both October and November, and neither is giving any sense of optimism.”

Six markets, including Atlanta, Charlotte, Miami, Portland (OR), Seattle and Tampa, hit their lowest levels since home prices started to fall in 2006 and 2007. This means average home prices in those markets have fallen beyond the recent lows seen in most other markets in the spring of 2009.

The 10-City Composite posted a +0.2% annual growth rate in October, whereas the 20-City Composite  was in negative territory, down 0.8% in October.

Only four major metro areas showed year-over-year home price gains in October, including Los Angeles, San Diego, San Francisco and Washington D.C. Los Angeles and Washington D.C. posted the largest gains, 3.3 percent and 3.7 percent respectively.