2013 Real Estate in Southern California

As all numbers and trends indicate the real estate market is going to travel upward. Even if we fly from the Washington DC man made cliff.

How up? Nobody knows. My advice to my clients is buy now if you can. Environment is perfect. Low interest & low property prices. What else do you need?

Program like Homepath and FHA required low down payment ( 3% down payment) to purcahse. Just remember, by renting, you pay your landlord mortgage every month. You can change this by seriously thinking to buy your first home. Unlimited resources are available online & offline. If you have solid job and you are paying your rent on time every month, most likely you can buy. (yes, lots of other factors will be considered, but your job and ability to pay your monthly mortgage are the most important of all). 

Note: In California, seller pays for your real estate agent fees. So, is unforgivable not to call an real estate expert to help you.

Always... Unconditionally... Follow your heart

When with your family these holidays, really be with them, stay in the moment, share the smiles, feel the warmth, and you will feel the spirit within fill your heart with joy and love.............

Should You Consider refinancing?

Facts are:

1. Mortgage rate is at historical lows now (at the time of this posting Dec. 2012). 

2. All indication shows upward trend for mortgage rate.

3. Banks are issuing credit for qualified applicants.

So, why not consult with mortgage professional to see if you can refinance your loan. See if you are not under the water. Meaning your value of home is NOT less than you value of your loan, than you need to refinance imminently before hike up. Take advantage of this low rate. If your rate is higher than 5% you should refinance and save some money every month. PLEASE CONSULT WITH MORTGAGE SPECIALIST. Check current mortgage rate here Catalyst Lending where I am affiliated with. Also, Email me if you need to determine your home value or CMA (comparable Market Analysis). This is a FREE service I provide for all my clients.

Happy Holiday

Wow, 2013 is here. Real estate market is already shows signs of improvement.  We are at the bottom of real estate parabola curve and trending upward. I think is the best time to invest in real estate. Prices are low and interest rate is low. These two ingredients are barely low the same time. What a buyer wants?  I wish you happy holidays. I will continue to write about all aspect of real estate and home loan in 2013. Please visit this blog often as I provide useful information for both buyers and sellers. 

November 2012 Real Estate Activity report for LA & OC

According to PWR (Pacific West Association of Realtors) New Listings were down 12.9 percent for detached homes and 19.5 percent for attached properties. Pending Sales increased 47.3 percent for single-family homes and 37.9 percent for townhouse-condo properties.  Please note that PWR covers only Los Angeles and Orange Counties. 
See complete report. 

You can find many charts and figures to show the market trend. It is very useful if you are investors or first time home buyer. I highly recommend you spend a little time and review it. 
I am hoping the information I provide is useful to you and improves your investment strategy. 

How Much Home Can You Afford?

In order for you to determine how much you can afford for a home, you first need to understand the standard debt-to-income ratio. Lenders call this the Front & Back ratio. There is an easy way to figure out how much you can afford, which will give you an idea for a quick estimate.

 $_____ (your monthly rent) x 200 = $_____ (this is about how much you can afford)

Front-end ratio: The housing expense, or front-end ratio, shows how much of your gross (pre-taxed) monthly income would go towards your mortgage payment. The result is your maximum housing expense ratio. 

Back-end ratio: The total debt-to-income, or back-end ratio, shows how much of your gross income would go toward all of your debt obligations, including mortgage, car loans, child support and alimony, credit card bills, student loans and condominium fees. In general, your total monthly debt obligation should not exceed 36 percent of your gross income. To calculate your debt-to-income ratio, multiply your annual salary by 0.36, then divide by 12 (months). The result is your maximum allowable debt-to-income ratio. 

Now you can try this Affordability Calculator to determine your own scenario very easily.

Seal Beach OC Local Market Update for November 2012

The City of Seal Beach is a Charter City located in Orange County, California. Seal Beach sits on the coast as the gateway to Orange County between the cities of Long Beach and Huntington Beach. The City of Seal Beach is well known as a quaint, small-town atmosphere. City programs, non-profit groups and businesses provide a variety of services, exciting events and activities in which residents can participate and enjoy. Read More




See Seal Beach Market Update for November 2012

Local Market Update for November 2012 (90803 – Long Beach)

Belmont Heights is a district in the south-east portion of the city of Long Beach, California, United States, bordering the Pacific Ocean and the more commercial community of Belmont Shore. The district commemorates the old City of Belmont Heights, which was incorporated in 1908 and annexed to Long Beach in 1909.[1] Belmont Heights' borders are Ocean Boulevard (and Livingston Drive) to the south, Redondo Avenue on the west, 7th Street to the North, and Nieto Avenue to the east. The area is mostly residential, but also has an active business district, the strip of Broadway east of Redondo Avenue.




The Belmont Heights Historic Landmark District includes homes between Seventh Street on the north, Fourth Street on the south, Newport Avenue on the west and Roswell Avenue on the east. A few properties located on Fourth and Seventh streets are included. The neighborhood was first subdivided and developed in the 1900s (decade). The oldest homes surviving today date from 1905. The predominant architectural style in the district is the Craftsman bungalow. Out of 304 homes surveyed, 206 are "contributing" Craftsman bungalows, and 125 of these are pristine unaltered examples. Other architectural styles found in the area that are considered contributing are Victorian, Mediterranean andSpanish Colonial Revival, Tudor Revival and Neo-Traditional. The period of architectural significance for the district is 1905-39. Construction peaked in 1922. Most homes are single-family, with some duplexes and a few apartment houses. Thirty-seven of the homes surveyed were ranked as "noncontributing", or 13 percent. The district commemorates the old City of Belmont Heights, which was incorporated in 1908 and annexed to Long Beach in 1909.





Did You Know?
Before annexation into the City of Long Beach, Belmont Heights was a dry town.[4]
The Green Long Beach Festival was created after several activists shared ideas at the Viento y Agua Coffee Shop in Belmont Heights.[5]
Feral Parrots A notable feature of Belmont Heights is its large population of feral parrots. In between Redondo Avenue and Livingston Drive along Ocean Blvd, amongst the palm trees, this large population of birds can be seen and heard by people for many houses. Some consider these animals to be a nuisance due to their rather vocal and loud sounds. However, the residents of Belmont Heights have grown to accept them as part of their community.

The Estate Tax - Where Is It Headed?

Thank you Amy for the great article. I highly recommend  Tax and Accounting Services for all your asset management, accounting  and tax strategy evaluation. Please see all services they are offering.  Also, if you like to ask any questions about Real Estate Taxes,  contact Amy Vaughn at avaughn@windes.com or 562-435-1191.

in 2011 and $5,120,000 ($10,240,000 for married couples) in 2012, and reducing the maximum tax rate to 35%. The 2010 Act also provided
for portability of the exemption amount, allowing the unused exemption amount of a deceased spouse to pass to the surviving spouse. The 2010 Act is set to expire at the end of this year. The exemption amounts and maximum rates are scheduled to revert to 2001 rates and amounts, and
portability will no longer be available.


So, what is in store for the estate tax? While no one is sure, following are some of the options for the estate tax in 2013:
1. Congress takes no action before year-end and allows the exemption and tax rates to fall back to the pre-2001 levels. This means
a $1,000,000 estate and gift exemption amount (with the GST exemption indexed for inflation) and a maximum tax rate of
55%. While many tax advisors believe this is not likely to occur, this is the law scheduled to take effect on January 1, 2013.
2. Congress extends the 2012 amounts, rates, and portability for one or two years as a “patch” until a final determination of
the estate tax policy is made.
3. Congress makes the current 2012 law permanent, indexing the $5,120,000 exemption amount each year for inflation,
keeping the maximum tax rate at 35% and allowing portability. However, under this scenario, certain popular estate planning
techniques could be eliminated or severely curtailed, including valuation discounts for transfers between family
members, grantor retained annuity trusts (GRATs) with less than 10-year terms, estate tax benefits of grantor trusts, and
unlimited GST protection for certain transfers in trust.
4. In a plan proposed by President Obama, Congress compromises and makes the 2009 law permanent, with
an estate and GST exemption amount of $3,500,000 and a maximum tax rate of 45%. The gift tax exemption
would revert to $1,000,000 with a 45% maximum tax rate. Portability would remain intact. Obama
also proposes the elimination or curtailment of a number of estate planning techniques mentioned above.
5. Congress repeals the estate and GST tax, leaving the gift tax intact, with a $1,000,000 (or higher)
exemption amount and a tax rate at 35% to 45%. If Congress should repeal the estate tax in 2013, they
may replace it with a capital gains tax, stepping up the assets owned by the decedent to the date-of-death
values and taxing the appreciation at the lower (for now) capital gains rate.

by: Amy Vaughn, CPA, JD
Senior Manager
Tax and Accounting Services

90802, located at Down town Long Beach, CA. Include East Village Art District the hippest & happening place.  Restaurants, coffee shops and galleries are must see . Real Estate is in upward trend. Here are two reports I like you to look at:

Local Market Update for October 2012

Long Beach, 30802 Demographic

Please post any questions you may have.

California housing market continues strong performance in October

LOS ANGELES (Nov. 15) – California’s housing market continued its momentum in October, posting strong year-over-year sales and price gains in nearly every county of the state, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported.
  
“Sales surged to the highest level since May, with demand continuing to be strong across all parts of the state,” said 2013 C.A.R. President Don Faught.  “Sales were particularly robust in the coastal markets, but they also rose significantly in many non-metropolitan areas, as confidence toward the housing market continued to improve.  Most counties in the Northern California region, for example, posted double-digit year-over-year sales gains in October.” 
      
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 544,380 units, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide.  Sales in October were up 12.5 percent from a revised 484,050 in September and up 10.2 percent from a revised 493,790 in October 2011.  The statewide sales figure represents what would be the total number of homes sold during 2012 if sales maintained the October pace throughout the year.  It is adjusted to account for seasonal factors that typically influence home sales. Read More

See 90803 Market Update for October 2012

2013 Standard Mileage Rates for Business, Medical, and Moving

Internal Revenue Service (IRS) has announced the 2013 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.
Beginning on January 1, 2013, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
* 56.5 cents per mile for business miles driven
* 24 cents per mile driven for medical or moving purposes.
* 14 cents per mile driven for service of charitable organizations
The rate for business miles driven during 2013 increases 1 cent from the 2012 rate. The medical and moving rate is also up 1 cent per mile from the 2012 rate. The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.
Taxpayers always have the option of calculating the actual cost of using their vehicles rather than using the standard mileage rates. A taxpayer may not used the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously.
These and other requirements for a taxpayer to use a standard mileage rate to calculate the amount of a deductible business, moving, medial, or charitable expense are in Revenue Procedure 2010-51. The IRS Notice 2012-72 contains the standard mileage rate, the amount a taxpayer must use in calculating reduction to basis for deprecation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.

What’s in store for the California’s housing market in 2013?

  
The recent positive headlines on the real
estate market show that housing has finally
turned the corner. Nationally home sales are
up 11.0 percent over that of last year, even
the sales of new homes are up 25 percent
from the year before, and the median price is
up 11.7 percent. The median price of existing
homes nationally is also up 11.3 percent from
a year ago. New residential construction is
soaring; since September 2011, single-family
housing starts have increased 43 percent,
and apartment construction has increased 19
percent.
In California housing fundamentals seem
strong as well. Existing home sales are up 5.9
percent for the year, while prices posted a
19.5 percent jump. Non-distressed sales
continue trending higher, currently at 63
percent of all sales, as compared to 30
percent in early 2009. Distressed sales, on
the other hand, dropped from 60 percent in
2009 to 37 percent. Increasing home prices
have certainly created a sense of urgency
among buyers causing many listings to have
multiple offers and to close above the listing
prices. Significantly low inventory constrained
sales for most of 2012. In September, the
unsold inventory index reached 3.2 months,
less than half of the historical average of 7
months. The REO inventory is even lower, at
1.8 months, and less than a month in some
areas, like the Orange County. The result of
the low inventory is reflected in the soaring
home prices, particularly in the Bay area,
where employment growth has fared better
than the rest of the state. Read More

Buying a Home Today: Rates, Prices, and Loans

Rarely has housing affordability in California been
as high as it is now. The statewide median home
price in California is at 2001-2002 levels and
mortgage rates hit their lowest level ever in 2011.
Yet, the media reports that households are having
trouble obtaining loans and the share of first-time
buyers in the market is much lower than expected,
given such low prices and rates. Which begs the
question, is this measure of housing affordability
accurate?
Homes Are Very Affordable Now
C.A.R.’s Housing Affordability Index (HAI) has
been around since the 1980s, and was intended to
be a predictive measure of housing, showing
households’ ability to purchase a home at the
prevailing market prices, rates, and incomes. The
HAI assumes a 20 percent down payment, the
median price for a geographic area (e.g. $292,120
for California’s 3rd quarter of this year), and the
corresponding monthly payment for principal,
interest, taxes and insurance should account for no
more than 30 percent of a household’s income.
See entire report

Understanding Today’s Market: Where did the inventory go?

Signs of positive change in the housing market
are everywhere. Housing prices are seeing gains
that are the highest in six years. Investors, who
led the California market off the 2009 market
bottom with all-cash demand for distressed
properties, are still bullish and a force to be
reckoned with. Mortgage rates are at 50-year
lows, and housing affordability remains at record
highs. For the majority of potential homebuyers,
the recommendation based on a “buy versus
rent” analysis is unequivocal: it’s time to buy. So
the housing market is on the road to recovery
with all systems go – right? Not exactly. There
are a few significant speed-bumps, with the
biggest by far being a lack of inventory.
Read More

Supply Shortage Intensifies Market Competition

While the California housing market continued to show
strong sales growth since early 2012, the lack of
inventory remained an issue throughout the year. In
October, the California Association of REALTORS®
(C.A.R.) reported a supply of inventory at 3.1 months,
which was less than half of the norm of about seven
months, and was at the lowest level since Aug 2005.
The shortage of supply was across the board, but the
decline was especially pronounced for distressed
properties, as short sales inventory and bank-owned
(REO) inventory declined from last October by 42
percent and 58 percent respectively, while equity
sales decreased 15 percent from last year. Read More