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Cash Sales Accounted for 32 Percent of All Home Sales in May 2015

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Cash sales made up 31.9 percent of total home sales in May 2015, down from 35.1 percent in May 2014. The year-over-year share has fallen each month since January 2013, making May 2015 the 29th consecutive month of declines. Month over month, the cash sales share fell by 1.7 percentage points in May 2015 compared with April 2015. Due to seasonality in the housing market, cash sales share comparisons should be made on a year-over-year basis.
The cash sales share peaked in January 2011 when cash transactions made up 46.5 percent of total home sales nationally. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25 percent. If the cash sales share continues to fall at the same rate it did in May 2015, the share should hit 25 percent by mid-2017.

Figure 1 shows the historical trend in cash sales share by sale type. Real estate-owned (REO) sales had the largest cash sales share in May 2015 at 56.1 percent and was the only sales category to see a year-over-year increase in the cash sales share. Resales had the next highest cash sales share at 31.5 percent, followed by short sales (30.1 percent) and newly constructed homes (14.7 percent). While the percentage of REO sales that were all-cash transactions remained high, REO transactions made up only 6.4 percent of all sales in May 2015. In January 2011 when the cash sales share was at its peak, REO sales made up 23.8 percent of total home sales. Resales typically make up the majority of home sales (about 82 percent in May 2015), and therefore have the biggest impact on the total cash sales share.

Figure 2 shows the cash sales share by state1 for May 2015. Florida had the largest share of any state at 47.8 percent, followed by New York (45.8 percent), New Jersey (45.8 percent), Alabama (44.2 percent) and Michigan (38.4 percent). Of the nation’s largest 100 Core Based Statistical Areas (CBSAs)2 measured by population, West Palm Beach-Boca Raton-Delray Beach, Fla. had the highest cash sales share at 58.1 percent, followed by North Port-Sarasota-Bradenton, Fla. (55.9 percent), Cape Coral-Fort Myers, Fla. (55 percent), Detroit-Dearborn-Livonia, Mich. (54.6 percent) and Miami-Miami Beach-Kendall, Fla. (54.6 percent). Syracuse, N.Y. had the lowest cash sales share at 11.6 percent.

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Southland home sales hit a nine-year high; prices up 5.5%

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The Southern California housing market is enjoying a summer almost as hot as the weather.

Home sales reached a nine-year high in July, while the median price climbed 5.5% from a year earlier, according a report out Tuesday from CoreLogic.

The data represent a housing market that’s picked up steam from a sluggish 2014, as an improved economy gives more families the confidence to buy a home. June sales also were at a nine-year high.
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“Much of today’s demand stems from job growth, low mortgage rates and a more confident consumer,” CoreLogic analyst Andrew LePage said.

The 16.9% increase in sales from July 2014 comes as investors pull back from the marketplace, leaving more breathing room for families.
cComments

“Real estate agents say some families have jumped into the market given all the talk about a coming rise in interest rates if the Federal Reserve raises its short-term benchmark rate later this year, as expected.” LOL. The Fed overnight rate has nothing to do with mortgage rates….

In July, absentee buyers, who are mostly investors, bought 21% of all homes sold, the smallest share since June 2010. All-cash transactions, often the sign of an investment deal, also fell to 21.7% of sales, the lowest since November 2008.

Real estate agents say some families have jumped into the market given all the talk about a coming rise in interest rates if the Federal Reserve raises its short-term benchmark rate later this year, as expected.

The robust demand pushed sales up in six Southland counties: Los Angeles, Orange, Riverside, San Bernardino, San Diego and Ventura.
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In Los Angeles County, sales jumped 13.5% from a year earlier. The median price, the point where half the homes sold for more and half for less, rose 4.7% to $492,000. In Orange County, sales were up 15.5% and prices increased 5.3% to $615,000.

The six-county region’s median price ticked down 0.9% from June to $438,000. But LePage said such a month-to-month dip is not unusual and probably represents a shift in the mix of homes selling.

Most economists predict continued price appreciation ahead, though at a slower pace than in recent years as families struggle to afford the increased cost of housing. The California Assn. of Realtors expects that by the end of December the median price for a California single-family home will have risen 5.3% in 2015.

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A Cold Look At The Hot Housing Market

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Housing markets in parts of the U.S. are rife with volatility, as sellers push prices up and buyers throw caution to the wind in trying to win bidding wars.

“It’s fast, it’s hot … but the sales always have complications,” said Barb Jandric, president of Berkshire Hathaway (BRK-A) affiliate Edina Realty.

Sellers and buyers must understand financing shifts, new appraisal rules and how marketing choices can affect a sale. And if your market is one of the hottest, you’ll also need to learn the ins and outs of managing multiple offers.

How frothy is the market? According to the National Association of Realtors, sales of existing homes rose in June to their highest rate in eight years, and their median price hit $236,400, which is 6.5% higher than in June 2014 and past the peak median price of $230,400 set in July 2006.

But Realtor.com chief economist Jonathan Smoke said he sees “no evidence at this time” of the outlandish speculation that drove the last real estate boom and then bust. In this market, “increases in home prices have been driven by tight supply and high demand,” Smoke said, with financing remaining conservative.

However, “individuals’ equity position is improving — so more people will be able to sell their homes and that will free up existing inventory,” said Bruce Zipf, president and CEO of NRT, a Realogy Holdings (RLGY) subsidiary.

Lending Lag, Appraisal Anxiety

Experts say that along with a boost in first-time buyers — who make up 30% of the market after falling to 28% in 2014 — tight credit markets have made FHA financing a bigger factor.

In the first half of 2015, FHA loans accounted for 22% of all condo and home purchases made with financing, up from 19% in 2014, according to real estate data provider RealtyTrac .

In those markets where the number of FHA loans are higher than average, patience is required.

“Government loans take longer,” said Dave Liniger, CEO of Re/Max (RMAX). Experts say to plan on a 60-day escrow for a buyer with FHA financing, as opposed to 45 or 30 days.

Once an offer has been made and accepted, the lending bank will require an appraisal. This process also has changed in the wake of the last real estate boom and bust. To avoid undue influence, appraisers now are randomly assigned from a lenders’ approved pool.

However, the new process hasn’t been without its challenges. Real estate agents complain that sometimes an assigned appraiser from outside of an area is “appraising outside his or her range of knowledge,” said Liniger.

Appraisals also can lag pricing trends, stalling deals. In Denver, “buyers are bidding up prices to a point to where they’re probably overpaying … and then we can’t get the houses to appraise,” said Realtor Kelly Moye, whose Kelly Moye Team is a Re/Max Alliance affiliate in Bloomfield, Colo.

Still No Easy Sell

Pricing, marketing and staging are still important in selling a home, even in a hot market. “It’s a sellers’ market, if you price appropriately,” said NRT’s Zipf.

“Managing that first week on the market is key,” said Brock Harris, a broker with Brock Real Estate in Los Angeles, explaining that “90% of the excitement is in the first week — so take great pictures and price it right.

Moye said she’s “marketing more and more to Realtors; they’re the ones that need to be kept apprised of what’s coming on the market,” so they can alert eager buyers.

Some sellers in hot markets are even paying for home inspections themselves. “We’re seeing way more pre-listing inspections,” said Harris. By doing this, he said, sellers can “neutralize any potential renegotiating of the price after the inspection.

The process of listing a property, on the local MLS and on the listing portals — Zillow (NASDAQ:Z), Trulia, Realtor.com, etc. — is also undergoing some changes. Some real estate agencies and agents are unhappy with how portals have been treating them. So in some cases they’re choosing not to syndicate a listing, selecting to only list on certain portals, or delaying listing syndication.

The rub: Agents say that portals take their listings — which they’ve spent time and money to put together — then post them and try to sell advertising back to them. They also complain that portals can be slow to update changes to listings — such as new photos and prices, and when properties have pending offers.

Moye estimates that about 20% of agents in the Denver area are opting out of syndication — in a hot market they don’t need to syndicate. Others list on just some portals. Moye leaves the choice of syndication up to her sellers, some of whom might be reluctant to widely circulate photos of their homes. Portals like Zillow, with its “Zestimate,” also have drawn criticism from homeowners for the estimated market values they put on properties. Moye says her MLS now allows her to easily opt out of syndication if that’s what her seller chooses.

Edina pulled completely out of syndication from 2011 until October 2014. Jandric says that Edina felt the portals weren’t “respecting our inventory and we weren’t getting the identification we wanted.” But she says Zillow, Trulia and Realtor.com are “doing it differently now — the broker is identified with each listing and there are links back to our site. The objections we had were resolved.

Harris said California Realtors are also grumbling about the portals: “The tech guys got between us and our customers. Our MLS just introduced a three-day delay before listings go out to syndication. The idea behind the delay is we can tell our clients that we’re still the first source for the newest and best listings.

‘Coming Soon’; Bidding Wars

In hot markets, some agents post “coming soon” signs on houses, trying to spur interest before the home is listed. It can also be “code for double-ending the deal,” said Harris. That’s when a selling agent represents the buyer too, thus doing both sides of the deal and collecting the entire commission.

Multiple bids are now the norm in hot markets like Denver. Moye says that to win a bidding war, some buyers are dropping all contingencies. But nerves sometimes kick in, “and three days later the buyer gets cold feet,” she said. “Sometimes you go through several buyers.

Moye says that working with buyers who choose to remove all contingencies, in order to win a bidding war, is “very scary” and she doesn’t like to leave them “exposed like that.

Harris used the same word, “scary,” to describe deals in which L.A. homebuyers cut out all contingencies to win a bidding war. And, he said, “it’s exhausting because you have to put yourself in that precarious position multiple times. I tell my buyers to be ready to write at least five to 10 offers.”


Army Corps board approves $1.3-billion L.A. River restoration proposal

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Plan to spend $1.3 billion or more restoring the Los Angeles River and redeveloping nearby land inched forward Thursday as a federal review board agreed to let the proposal proceed.

The Civil Works Review Board of the Army Corps of Engineers unanimously approved the plan, echoing support pledged 14 months ago by Assistant Army Secretary for Civil Works Jo-Ellen Darcy. The proposal still must get the approval of additional government agencies, as well as the Corps’ head engineer and the U.S. Congress.

The plan’s advance comes even as questions are brewing about who will pay for the restoration, which would transform the concrete-jacketed stretch of river between Griffith Park and downtown L.A. and is expected to take up to a half-century to complete.

Mayor Eric Garcetti said last year that the federal government would split the cost of the project, an arrangement that would put the city on the hook for about $500 million. However, a report issued earlier this year by L.A.’s chief legislative analyst stated that the city’s share of the cost could rise to as much as $1.2 billion.

Garcetti, who spoke in support of the project before the Review Board on Thursday, said in a statement that the board’s decision “marks an important milestone in our efforts to restore the Los Angeles River.”

Follow @PeteJamison for more news from L.A. City Hall.

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Architect Frank Gehry is helping L.A. to redevelop the Los Angeles River

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enowned architect Frank Gehry is working with Los Angeles officials in the public and private sector to draft a new master plan for the redevelopment of the Los Angeles River.

Gehry’s involvement is a potential turning point in the decades-long movement to transform the concrete-lined waterway that winds through the heart of the Los Angeles Basin. It promises to bestow the cachet of one of the world’s best-known artistic celebrities on a restoration effort that Mayor Eric Garcetti has placed at the center of his agenda.
New L.A. River plan
Caption New L.A. River plan
Luis Sinco / Los Angeles Times

A blue hero takes flight amid the vegetation in the middle of the Glendale Narrows of the Los Angeles River. Famed architect Frank Gehry’s involvement is a potential turning point in the decades-long movement to transform the concrete-lined waterway that winds through the heart of the Los Angeles Basin.
New L.A. River plan
Caption New L.A. River plan
Luis Sinco / Los Angeles Times

Glendale resident Sarita Vidal and her springer spaniel, Jeni, cool off in the Glendale Narrows area of the Los Angeles River. Renowned architect Frank Gehry is working with Los Angeles officials in the public and private sector to draft a new master plan for the redevelopment of the river.

Many details of Gehry’s work — including exactly what his plan entails and how much it would cost — are still unknown. Two sources who have seen a presentation on the plan by Los Angeles River Revitalization Corp. officials said it appears to be a broad reworking of the Los Angeles River Revitalization Master Plan that L.A. city officials adopted in 2007 following extensive public input.

That plan established the city’s long-term goals for the river; established design guidelines for the redevelopment of its banks and the surrounding areas; and laid out a detailed vision for public access to the river and the preservation of parkland and recreational areas in the 52-mile river corridor.

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The sources said the presentations they saw did not include renderings of specific landscape or architectural features, such as walkways or bridges. However, they said that maps included in the briefing made clear that Gehry’s plan will encompass the entire reach of the river from L.A. to Long Beach, and could also apply to its tributaries.
Frank Gehry

Los Angeles architect Frank Gehry, pictured with an early model of the Walt Disney Concert Hall, has been working on a plan to redevelop the Los Angeles River. (Thomas Kelsey / Los Angeles Times)

Despite its potential benefits, however, the new plan is getting a cold reception from the community of activists who have helped draw attention over the years to what was once a forlorn environmental cause. Some of those activists express concern about the secrecy surrounding Gehry’s work and the near-total lack of public input to date on such a far-ranging blueprint for the river’s future.

The critics also say the sudden announcement of a new direction for river redevelopment could imperil federal funding for a $1.4-billion restoration project, focused on 11 miles of the river as it winds through Northeast L.A. and the downtown area. The U.S. Army Corps of Engineers has given tentative approval to the project but has not yet decided how much of the cost it is willing to bear.
cComments

There’s nothing new to see here. It’s more Garcettism. It will require a new DEIR and Garcetti will not do one, but he will be sued and the courts will require a new DEIR. That should halt all revitalization for a minimum of five (5) years. After Garcetti is sued, he won’t…
RickAbrams
at 3:11 PM August 07, 2015

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Such concerns came to a head this week, when Friends of the Los Angeles River, the nonprofit group led by iconic poet and environmentalist Lewis MacAdams, sent a letter to the Los Angeles River Revitalization Corp. refusing to support the project or take part in a press conference announcing Gehry’s plan that is scheduled to take place at the end of this month.

In the letter, obtained by The Times, MacAdams wrote that he feared the “new vision and plan for the river led by Frank Gehry” would “undermine our efforts and create confusion among the public and political leadership.”
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In an interview, MacAdams said his group’s decision not to endorse the project stemmed from tactical considerations in the battle to fund environmental restoration and philosophical opposition to the sort of top-down land-use planning that led the federal government in the mid-20th century to turn a meandering alluvial river into a notoriously unsightly drainage channel.

“Last time there was a single idea for the L.A. River it involved 3 million barrels of concrete,” MacAdams said. “To us, it’s the epitome of wrong-ended planning. It’s not coming from the bottom up. It’s coming from the top down.”

Gehry, a Canadian-born architect who lives in L.A., has designed some of the world’s most famous and recognizable buildings, including the Guggenheim Museum in Bilbao and the Walt Disney Concert Hall in downtown L.A. His best-known structures are characterized by a free-handed sculptural sensibility — the flaring steel walls of Disney Hall offer one example — that has drawn both praise and criticism.


7 Easy and Affordable Home Improvement Ideas

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When it comes to improving your home, not everything has to be costly demolitions and additions. There are plenty of small steps you can take that will breathe new life into nearly every corner of your home while keeping your walls, floors, windows and bank account intact. Here are seven of our favorites.

1. Wallpaper
There was a time that updating a home meant removing—not installing—wallpaper. But there are some new dazzling options available that can revitalize even the dullest room. To keep costs down while simultaneously adding a true designer’s touch, paper only one accent wall. It’ll become a focal point that will make the room feel fresh and modern even if you don’t have the money to update your furnishings.
Cheap Remodeling – Apron Front Sink

Photo: kohler.com

2. Swap Out A Sink
Bathroom and kitchen remodels can be messy, costly affairs. You can, however, get a lot of the remodel bang for less bucks simply by swapping out a sink. In the bathroom, this will usually require changing the countertop as well, but that gives you even more room to make things interesting. Copper, glass, and porcelain basin sinks that sit on top of countertops have come down in cost and really add flair. In the kitchen, consider a deep-basin farmhouse-style sink or something made from industrial materials like concrete or stainless steel. To really splash out, change your faucets as well.

3. Paint
Without doubt, painting is the lowest-cost, highest-impact project you can do yourself to spruce up your home. Get extra mileage out of each gallon by using your creativity. Consider painting ceilings a dramatic color; use painter’s tape to mark out stripes on the wall and paint them with a slightly lighter or darker shade; or use stencils to create unique patterns and designs. Simple geometric shapes painted on the wall around a mirror, shelf, or piece of art are sure to gets lots of compliments and “wish I’d thought of that” moments from your guests.

Related: How To: Paint Like a Pro

4. Change the Lighting
Running new lights in the rooms of your home usually requires the services of an electrician and can get pricey. But swapping out fixtures is something even a causal DIYer can handle. Always make sure you turn the breaker off to the fixture you’re working on, then feel free to let inspiration be your guide. Search salvage shops and antique stores for chandeliers you can update with new glass pendants; swap an ordinary fixture on the ceiling for a dramatic ceiling fan; run new track lighting; or update old wall sconces with sleek modern replacements. If the idea of working with electricity is a little too shocking for you, you can have good design success simply by replacing shades on wall, ceiling, and tabletop lights.
Cheap Remodeling – VTech Doorbell

Vtech 2 Handset Answering System with Audio/Video Doorbell

5. Turbo Charge Your Doorbell
If you’ve been putting off the installation of a doorbell because you don’t want to pay an electrician to break into the walls to run wires, consider installing a wireless model. The bell mounts by your door and the receiver (the part that makes the noise) goes inside the house and can receive a signal hundreds of feet away.

To really go high tech while keeping things low cost, install the video doorbell phone system from VTech. The bell acts as a small camera, transmitting a photo or video of the person at the door to the small screen on the phone. You can talk to your visitor through the built-in intercom or simply choose to let him or her come back another time.

The phone even captures and stores still images of anyone who stopped by during the day. And there’s a great night vision feature that lets you see who’s calling even if it’s dark outside. Best of all, you get two phones with the integrated video intercom for less than the cost of some phone-only systems.

6. Revamp Closets and Drawers
Depending on your needs, this is a project that can bring both cosmetic and practical benefits. Cosmetically, if your kitchen or bathroom cabinet doors look dated, simply remove them, sand or strip, and repaint or stain in the color of your choice. If the cabinet surfaces don’t need a revamp, a simple swap-out of hinges and handles can go a long way. For the practical benefits, consider placing drawer rollouts in the kitchen. These easy-glide space enhancers let you store things like pot lids and plastic containers in a smart way and provide easy access when needed. In closets, get things organized with new shelves, cubbies, and hanging rods at different levels. Your home improvement store likely has aisles of ideas.
Cheap Remodeling – DIY Patio Canopy

Photo: allyou.com

7. Create an Outdoor Oasis
Building decks, patios, and gazebos takes a significant investment of time and funds. However, you can easily create a special space in your backyard by purchasing a free-standing canopy. Basic models are available in the $100 range, while more deluxe models can go up to $1,000 (compared to the cost of a more permanent structure, you’ll still save). Put a picnic table underneath your canopy, line the borders with flower pots you can buy at salvage yards, and you’ll have a unique refuge that’ll make you feel rich and famous, even if you didn’t pay celebrity prices to create it.

This post has been brought to you by VTech. Its facts and opinions are those of BobVila.com.

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