Long Beach Local Market Update for March 2013

Spanish style homes at Belmont Heights Long Beach 

Real estate market improving through the country.  Long Beach, California face low inventory and strong buyer demand. As the result, prices are inching higher.
See Long Beach Local Market Update for March 2013 which is done by Pacific West Association of Realtor. This report reveal very interesting numbers as compare March 2012 with March 2013 sale of Single Family homes and Condominiums.

Home values are on the rise & Property Flippers are Coming Back

Villa Rivera Long Beach CA by Amir Zee

Facts are as follows:

1. Home values are on the rise, with a year-over-year price increase of 11.6 percent, according to the National Association of Realtors. Inventory has cratered to levels not seen since 2005.

2. Today's flippers have learned some hard lessons. This time, homebuyers are being more selective - putting more money down and making calculated bets on smart renovations.

3.   The one-year average price increase their stands at 13.4 percent, according to the S&P/Case-Shiller Home Price Indices, 2 percent above the national average. 

4. The best places to flip in 2012 included Orlando, Florida; Richmond, Virginia; Tucson, Arizona; and Charlotte, North Carolina, according to RealtyTrac.


5. Cash is king, Bank have tight restrictions, and that means real estate investors coming in with all-cash deals have the upper hand. 


6.  Renovations matter, but stick to a budget. In today's market, you will likely only get a bargain if the house is in truly rough condition. 


7. Be prepared to hold Back, in 2003 the Federal Housing Administration (FHA) instituted anti-flipping regulations, prohibiting insuring a mortgage on a property owned by the seller for less than 90 days.


8. Do not expect to flip the property within days and realize lightning-quick profits. You may want to rent it out for a while as the housing market continues to recover, says Heller, in order to cover some costs and eventually secure an even higher resale price.

90803 Local Market Update for March 2013

Inventory of residential homes running low in Long Beach, CA  90803. Price of residential homes ticking upward. Interest is low. Over all Real Estate market at Belmont Height is improving. Please look at 90803 Local Market Update for March 2013 done by Pacific West Realtors Association.

Put Money to Work & buy your Home Now

Galaxy Tower Long Beach
photo: Amir Zee, 2013  

Look around you. Your parent, family members and friends all made money by buying real estate.

Simply, real estate is a good investment. Especially when is your primary resident. Here are some of the benefits:

• Interest deduction: Did you know you can deduct the interest you paid on your mortgage from your income. Therefore you pay less taxes. 

• Force Saving:In another word you are investing and saving the same time.

• Leverage: With just 10% down ($40,000) to purchase a home value at $400,000. And annual ROR (Rate of Return) of let’s say 5% is equal $20,000. Leverage is doing more with less. Please note as old saying says; timing is everything.The real estate market has been corrected and 2013 is beginning of appreciation cycle.

• Capital gain relief: if your primary home appreciate “single $250,000 and couple $500,000 “you will not pay any capital gain. Anything over this amount you will pay capital gain. How much? Depend on your tax bracket and other factors. Anywhere from 15% to 30% approximately.

 The ROR (rate of return) of real estate from 1978 till 2010 is 9.1% according to Clarion Partner September 2011 Report. When looking at a more recent period, 2001-2010 which includes both boom and bust periods.  The real estate delivered strong annualized returns of 7.4%, which is higher than stock returns (1.4% for the S&P 500 Index) and bond returns (5.8% for the Barclays Capital Bond Index).

If you decide to buy a home, Please work with professional real estate agent as the process and paper works is tremendously challenging. 

Six years after the sub-prime mortgage meltdown, What Now?

Tamarindo, Costa Rica by Amir Zee

Six years after the sub-prime mortgage meltdown, banks remain tight even with solid borrowers.

First-time buyers and self-employed borrowers must jump through especially complex hoops. Lenders say their cautions stems in part from uncertainty over a tougher new regulatory environment, along with unrelenting demands from government-sponsored mortgage buyers that the banks repurchase soured loans. Salaried professionals with credit scores in the high 700s have the best shot at being approved for a mortgage loan in this environment, along with borrowers who have never missed a payment and want to refinance.  

However, even these borrowers may face stiff documentation demands, including having to explain any bank deposit other than a regular paycheck.

Lafayette a Historic Building at Long Beach, CA 90802

Lafayette a Historic Building at Long Beach, CA 90802

2004 four-story condominium complex with street level retail and subterranean parking to be constructed on the lot directly across the street from Lafayette. Lafayette owners purchase parking spaces in the soon-to-be-built complex.Due to real estate market down turn, this project never built.

Why seller are selling?

Bluff park city sign, Long Beach, CA

Two groups of seller are selling now.

1. The sellers are under pressure and can not make their mortgage due to a hardship. Hardship could be Illness, lost of employment and so on.

2. Sellers who are upgrading. Selling their home and purcahseing a new property. This is the best time to upgrade as you can purchase more expensive homes in discounted price due to market depreciation. Furthermore, mortgage interest rate is record low. This translate into a 4% APR in most cases and better terms such as 30 years fix loan.

Sellers who are comfortable with their mortgage payment and they are not under any pressure, wisely and patiently waiting for real estate prices hiking to reasonable level, then to sell.

In southern California, low inventory of properties is become common problem. Seems the number of investor and first time buyer are more than sellers. Look at this attached report created by CAR (California Association of Realtors) as demonstrate great details of Challenges for Home Sellers.

www.car.org/marketdata/marketsnapshot/mktsnapshot_201301