Whatever Happened to "As-Is"?

January 30, 2013
There was a time when the California Association of Realtors' Purchase Agreement contained a clause in which the seller "warranted" that all electrical, plumbing, heating, air conditioning systems would be in working order and that the roof would be free of leaks at close of escrow. By contract, the seller was obligated to deliver the property with all these elements in this "warranted" condition. Sometime in the 1990s, the C.A.R. Purchase Agreements changed and this "warranting" clause was removed. Today, our purchase agreements have a clause that states that the buyer is purchasing the property in its "as-is" condition as of the date that the contract was accepted. There is one caveat. This "as-as" condition is subject to the buyer's inspection and subsequent request for repairs. By contract, the seller does not have to make the requested repairs but the buyer does not have to complete the purchase if the seller refuses to do the repairs.
As the real estate market has cycled through up periods and down periods, the buyer's willingness to proceed depends on the buyer's desire to complete the purchase. The repairs became the second serious negotiation in any purchase transaction.
In recent times, however, another player has entered into the repair arena. Lenders, and their appraisers, now may list items that must be repaired prior to the lender funding the loan. In these cases, the sellers have very little choice if they wish to complete the transaction. Sellers complain that they were selling the property "as-is". Why must they incur these additional costs? Unfortunately, lender requirements are non-negotiable. Either the repairs are completed and an appraiser re inspects to check that they were completed satisfactorily or the buyer cannot get the loan. It can be difficult for a seller, and sometimes even the buyer, to understand why a roof certification is necessary or appliances need to be in working order. Isn't a lender's primary concern whether the buyer has sufficient funds, a track record showing that the buyer fulfills the credit obligations and an appraisal that takes into consideration the condition of the property sufficient to approve a loan? Apparently not.
"As-is" seems to have many qualifiers.

Innovations That May Be Incorporated Into New Homes

January 28, 2013
The annual International Builders' Show was held in Las Vegas last week With the construction of single family homes up 18.5% in December 2012 over December 2011, builders and suppliers such as GE were at the show with new and innovative products.
One of the accessory equipment that new homes may include is a compact generator from GE. The unit is an 8kW generator that can be placed as close as 18 inches from the home. The price was $2199 which is much reduced from the price of the large models that have generally been available. While having your own generator was a rarity, the recent disasters have made folks aware that having a power source of their own may be an important accessory for their home.
With an aging population and a rather substantial number of that population living in multi-storied residences,   Residential Elevators, Inc had a presence at the show displaying small elevator units that can rise up to 50 feet and carry 950 pounds.
Another interesting innovation tht might show up in new residential construction is a wall outlet that features a USB port. This allows heavy tech users to eliminate the device of a charger and plug their phones and tablets directly into the wall.
If you are interested in viewing the 2013 American Home you will find photos at WSJ.com/Mansion.

Open House Extravaganza

January 25, 2013
Every year, CENTURY 21 has an open house Sunday with many opportunities to view listed properties. Even though 2013 has been characterized as having less properties for sale than in the past years, we will be opening our listings for your viewing.
This open house event is an opportunity to check out prices, amenities, locations, decor and last but not least, professional real estate agents.
2013 may be the year that you have decided to enter the real estate market either as a buyer or a seller. Visiting open houses is a really good way to get a feel for what is happening and to interview real estate agents. Folks are sometimes embarrassed to go to open houses but be assured that real estate agents actually like visitors - no matter what the motivation. We are people loving people and enjoy these opportunities to interact on a very informal level.
Check your local paper for our January 26 and 27 open houses.
SO...................COME ON BY!!!

Closet Cleaning Time

January 24, 2013
Getting the new year off to a good start includes setting aside time to clean closets. It is amazing how much "stuff" accumulates from year to year. I don't know about the rest of you, but I do have a tendency when I am busy to just pop stuff out of sight - frequently on a closet shelf.
If the rain appears this weekend as predicted. it will be a great time to pull all that stuff out of at least one closet and sort it by "keepers" and "donations". Clothes, shoes, scarves and all the miscellany will be inspected, rejected or put neatly back in the closet.
I don't know that I will be quite as organized as some of our sellers who line their clothes up by color and style, but I should end up with a less crowed closet.
I know that one rule of thumb is "If you haven't worn it in three years, you need to get rid of it." However, I have some favorites that I just love and it will be truly difficult to send them on their way.
Even if you have no plans to put your house on the market, think of the wonderful feeling of knowing what is actually in your closet and knowing that someone else will be benefiting from your donated items.

A Real Estate Market in Flux

January 23, 2013
A real estate market in flux is a real estate market fraught with frustration. A few years ago when the real estate market was entering a downturn, sellers and listing agents were frustrated by (1) lack of offers, (2) offers way under the list price and often under the appraised value. Today it is the buyers and the selling agents who are frustrated. About six months ago buyers could write offers below the listed price and have some hope of receiving a counter offer or of having their offers accepted by the seller. In the 2013 real estate market, buyers need to consider writing offers above the listed price and still be prepared for rejection. Other buyers either wrote higher offers with stronger financing or all cash offers or even offers with no contingencies. Oh my goodness - how times have changed!
As I posted a week or so ago, if you seriously want to purchase a home in the current real estate market, make an appointment with a lender. Obtain a pre approval letter complete with FICO scores. Make a copy of your bank account. Offer thee very best price that your lender has approved. Be prepared for a wait before hearing back from the seller. Realize that the seller may not counter and you will not have a chance to increase your offer.
Frustrating. Yes. Prices are on the move, buyers cannot look back as times they are a changing.

The Cold Snap Had Our Fireplaces Glowing

January 22, 2013
In Southern California we do not often have the weather that encourages us to light up our fireplaces. "The refrain from the song "...the fire is so delightful" does evoke warmth and coziness. One of the important home maintenance items that can be overlooked is the need to clean out our chimneys from time to time. Since we may not burn wood in our fireplaces, we do not think about chimney sweeps.
However, it is certainly a wise idea to have your chimney inspected. It is not just the build up of soot that can create a fire hazard. Cracks in the mortar and clay can also allow flames to ignite the framing. A fireplace that is used only infrequently can encourage birds to next in the flue. Even with gas logs, the free flow air can be blocked.
Check your yellow pages or an Internet directory and you can find Chimney Sweeps as a category.

Home Building Is Beginning to Come Alive

January 21, 2013
While those of us who are agents in the resale real estate market do not generally sell the new construction, having more inventory would be a help in getting folks interested in purchasing a home. For the past few months I have been telling the home builders that I know that we need them to build new homes. Most of the time I received a rather tepid response. However, the past week, one builder acquaintance admitted that he was working on plans.
As home builders make plans for the type of home that they will construct, it will be interesting to see the design and the amenities that are included. Over the decades, housing styles have changed. In the 1940s and 1950s, and even in the early 1960s,  builders mostly built single story ranch homes. As land became costlier, their plans were predominantly two story homes. In the 1980s and 1990s the size of homes increased, the size of the lots decreased and the majority of new construction was two story homes. These two story homes in the early 2000s were often constructed as a unit in a planned unit development with homeowner associations managing common areas such as pools, parks, etc.
Will this trend continue?
As the population ages, the demand for single story homes has been increasing. Will home builders recognize this demographic trend and design homes sand projects that fit the needs of this older population?
At the moment, we are just thankful that the construction industry shows signs of reviving.

Time to Prune Your Roses

January 18, 2013
The month of January is the time for Southern Californians to get out the pruning clippers and prune their rose bushes. There have been several announcements of rose-pruning workshops for those who want to see how the master gardeners prune a rose bush. Proper pruning will produce better roses in the Spring.
Tomorrow morning, the Redlands Horticultural and Improvement Society will host a demonstration at 9 a.m. at Plymouth Village, 900 Salem Drive, Redlands. George Nash will show participants the correct way to prune and plant. This is a hands-on program and participants are encourage to bring gloves and their own pruners. There is no charge for this program and it is open to the public.
Information can be obtained at 909-798-9384 or 909-793-1016. On the Internet at www.gardenclub@rhis.org

CENTURY 21 Lois Lauer Realty' Charity Outreach

January 17, 2013
For over twenty years, CENTURY 21 Lois Lauer Realty has committed itself to supporting many charitable causes. As I believe I mentioned in early December, we were collecting items for Operation Gratitude, an not-for-profit- organization that sends care packages to the military. We just received a thank you letter from the organization which details what  items were donated by our collection.
I thought it was worth sharing this list as I found it quite amazing. We just box everything and do not itemize it so this list caused us great pleasure.
289 toothbrushes
111 dental kits
122 DVDs
86 CDs
41 hats
28 scarves
538+ cards and letters
\127.5 lbs of candy
335+ toiletries
41 Beanie Babies
Other assorted items
Operation Gratitude sent over 100,000 Care Packages. Since 2003 they have sent over 900,000 packages. CENTURY 21 Lois Lauer Realty has been collecting items for them almost since their beginning.

Real Estate Markets Are Traditionally Cyclical.

January 16, 2013
Real estate markets are traditionally cyclical. During times when prices and activity are rising, you pay hear folks voice the expectation that prices will continue to increase. This last downturn perhaps reminded us that real estate market ARE CYCLICAL.
If you read or listen to the media, you will see that they believe that this down cycle is over and that prices are poised to rise. I am in agreement that we are turning a corner and the supply and demand factor is creating an environment in which buyers are willing to pay above the listed price. Once lenders get on board we will probably see a rise in value.
The unknown factor in the immediate future is still the many homeowners who owe more than the market value of their property. This factor may be what is responsible for our exceptionally low inventory of homes for sale. Typically, when a cycle makes an upward turn, the rise in value is relatively moderate. It is only as we reach the end of the upward cycle that we have seen the big jump in prices. (It seems that after several years of an up trending market, folks again believe that prices will continue to rise forever.)
As yesterday's post demonstrated, Americans still want to be homeowners and still believe in the long term value of homeownership. For the present, this is the best part of a real estate cycle in which to purchase a home - no longer moving down and gradually moving up.

C.A.R. Pew Research Center Survey of The American Dream

If You Waited For Real Estate To Bottom Out...

January 14, 2013
If you are one of the folks who have been waiting for real estate prices to "bottom out", you may have missed it. We may be still close to the bottom, but the past three months have certainly seen the kind of activity that leads to the up-tick in home prices.
Inventory is at all time lows.
Home builders have not produced new homes. (In our market area it is almost impossible to find some new tracts under construction.)
Cash buyers have become willing to pay list price or even over list price when it is a multiple offer situation.
The good news for folks who are ready, willing and able to purchase a home is that the first two weeks of 2013 have seen an increase in new listings. The bad news is:  you are not alone and you will not be able to negotiate price.
The other good news is that interest rates remain low. Lenders have money to lend and we are hopeful that they will see that the real estate market has turned a corner. The appraisers will need to look at pending sales to evaluate whether a property is worth what a buyer is willing to pay. The old adage that real estate value is determined by what a ready, willing and able buyer will pay to a seller who is not under pressure to sell.
A word to the folks who are ready to jump into this real estate market: Find a lender, complete a loan application and have a pre approval letter in hand as you begin your search. Without this piece of paper, many sellers will no longer consider your offer.
This week, the media said that 2013 is going to be a good year for real estate. For us in the business, every year is a good year. It is just that some are better than others.

The Over $400,000 Market

January 10, 2013
Tracking the properties that were reported "sold" in the over $400,000 range seems to show that our market in the higher end has stabilized. Riverside and Redlands have shown some signs of life in this higher end market. Remembering that in the hey-days of 2005 and 2006 we had median prices in the $400,000 range, we still have a ways to go.
Here are the numbers as we began 2012 and as we ended 2012.
Banning/Beaumont...............December/0........January/1
Bloomington........................December/0........January/0
Colton.................................December/0........January/0
Fontana...............................December/3........January/1
Grand Terrace.....................December/0........January/0
Highland..............................December/2........January/1
Loma Linda.........................December/1........January/1
Mentone..............................December/0........January/0
Moreno Valley.....................December/0........January/0
Redlands..............................December/17..... January/5
Rialto...................................December/0........January/0
Riverside..............................December/27......January/18
San Bernardino....................December/1........January/1
Yucaipa/Calimesa................December/2........January/5
We shall continue to track these sales. I feel certain that many homeowners who purchased their homes in 2004, 2005 and 2006 are also watching to see when their values return.

Median Prices - December 2012 and January 2012

January 9, 2013
If median price changes are any indication of the state of the real estate market, 2012 was indeed a transitional time. Here are the median prices as of December 31, 2012 versus December 31, 2011.
It does seem to indicate that our real estate market is recovering from its devastating downturn. Just a reminder - these median prices are derived from taking the total number of closed single family homes reported through the CRMLS, dividing by two and posting the prices of the property at that halfway point.
Banning/Beaumont...........Dec 2012/$181,000.......Dec 2011/$233,000
Bloomington....................Dec 2012/$185,000.......Dec 2011/$145,000
Colton.............................Dec 2012/$109,000.......Dec 2011/$115,000
Fontana...........................Dec 2012/$230,000.......Dec 2011/$195,000
Grand Terrace.................Dec 2012/$175,000.......Dec 2011/$192,000
Highland..........................Dec 2012/$190,000.......Dec 2011/$165,000
Loma Linda.....................Dec 2012/$265,500.......Dec 2011/$210,000
Mentone..........................Dec 2012/$194,000.......Dec 2011/$128,000
Moreno Valley.................Dec 2012/$166,000.......Dec 2011/$152,000
Redlands..........................Dec 2012/$260,000.......Dec 2011/$206,000
Rialto...............................Dec 2012/$195,000.......Dec 2011/$152,000
Riverside..........................Dec 2012/$220,000.......Dec 2011/$187,000
San Bernardino................Dec 2012/$130,000.......Dec 2011/$102,000
Yucaipa/Calimesa............Dec 2012/$210,000.......Dec 2011/$170,000
As you may note, three of the fourteen communities were lower in median price than in 2011. It will be interesting to see if this is just an anomaly or whether they have not yet quite recovered. It is important to remember that these halfway point prices are the result of the mix of properties sold. They reflect where the activity is occurring.

Closed Single Family Residential Sales -2012

January 7, 2013
As is my custom, I post the number of single family units reported as sold in the CRMLS. The numbers to not reflect a very wide range in the closed transactions. Unlike when the downturn hit in 2007, they are very consistent.
Banning/Beaumont............Dec/121......Nov/129......Oct/122......Sept/102......Aug/125......July/111
........................................June/149......May/133......Apr/122......Mar/120......Feb/105......Jan/96
Bloomington.....................Dec/15........Nov/19.........Oct/10........Sept/19........Aug/16.......July/20
........................................June/29........May/18........Apr/22........Mar/24.........Feb/25.......Jan/15
Colton..............................Dec/35........Nov/29.........Oct/35.......Sept/22.........Aug/37.......July/29
........................................June/34........May/47........Apr/44........Mar/46.........Feb/42.......Jan/29
Fontana............................Dec/203......Nov/197.......Oct/217.....Sept/183.......Aug/244.....July/207
........................................June/230......May/257.......Apr/201......Mar/224.......Feb/190.....Jan/188
Grand Terrace..................Dec/12........Nov.14..........Oct/9.........Sept/10.........Aug/16.......July/16
........................................June/15........May/16.........Apr/10........Mar/11.........Feb/8.........Jan/13
Highland...........................Dec/52........Nov/49..........Oct/50.......Sept/40.........Aug/84.......July/54
........................................June/79........May/79..........Apr/63.......Mar/46.........Feb/46.......Jan/45
Loma Linda......................Dec/18........Nov/13...........Oct/18.......Sept/8...........Aug/15......July/13
........................................June/15........May/21...........Apr/12.......Mar/21.........Feb/12......Jan/12
Mentone...........................Dec/3..........Nov/7.............Oct/7.........Sept/9...........Aug/10......July/11
........................................June/8..........May/8.............Apr/10.......Mar/13.........Feb/16.......Jan/7
Moreno Valley..................Dec/170......Nov/199.........Oct/215.....Sept/174.......Aug/242.....July/209
........................................June/219......May/246.........Apr/199.....Mar/244........Feb/174.....Jan/195
Redlands..........................Dec/69.........Nov/59...........Oct/73.......Sept/66..........Aug/77......July/67
........................................June/98.........May/72..........Apr/65........Mar/80..........Feb/55......Jan/49
Rialto...............................Dec/79..........Nov/69..........Oct/88........Sept/66..........Aug/110....July/111
........................................June/110.......May/113........Apr/103......Mar/118.........Feb/85......Jan/97
Riverside..........................Dec/351.......Nov/319.........Oct/369......Sept/333........Aug/402....July/402
........................................June/401.......May/432........Apr/352......Mar/405.........Feb/364....Jan/323
San Bernardino.................Dec/149.......Nov/159.........Oct/186......Sept/126........Aug/204....July/154
........................................June/195.......May/204.........Apr/175.....Mar/210.........Feb/133.....Jan/189
Yucaipa/Calimesa.............Dec/63.........Nov/57............Oct/57.......Sept/60...........Aug/72......July/61
........................................June/79.........May/73............Apr/61.......Mar/78...........Feb/57......Jan/55
With the exception of Loma Linda, the closings showed some slacking off in December froom six months before in June. It will be interesting to see if the reduction in closings continues and may become related to our present low inventory.

January is Movie Month

January 4, 2013
The Palm Springs International Film Festival kicks off tomorrow with the Awards Gala. The Film Festival will be ongoing through January 14 at a variety of locations in Palm Springs. Ticks range in price from $11-$75. Sunday, January 6 at 11:30 a.m. there will be a special screening of Les Miserables with director Tom Hooper and star Eddie Redmayne on hand for a discussion. Tickets are $25 for this event.
Information is on the web site: www.psfilmfest.org. You can also call 800-898-7256

Here's the Picture - No Homes For Sale

January 3, 2013
As I mentioned in yesterday's post, here are the totals of listings, pendings and back-ups for all fourteen communities that I track. I am posting January 1, 2013 and January 1, 2012. With these numbers, it is a rather graphic picture of why buyers have become so frantic.
If you want to revisit the names of the fourteen communities in this tally, you can check yesterday's (01/02/2013) post.
Listings 2013/1556......2012/4476......Pend 2013/2808......2012/2725
Back-up 2013/1125......2012/1264

It is interesting to note that while the active listings are almost two thirds less than they were one year ago.
The pendings and back-ups, however, have changed very little. Looks as though we have the same number of folks actually purchasing homes as we did a year ago.Potential buyers are making offers as soon as a property is listed for sale and many. many of the new listings have multiple buyers competing for the property. Think what the numbers would be if we had a larger selection of available properties for sale.
Just this morning, I read an article in the LA Times that cited a report by CoreLogic that the so-called shadow inventory (Remember that we were to experience a glut of properties for sale in 2012.) had declined in October by 12.3% from the previous year. CoreLogic expects that this "shadow inventory" of homes that have delinquent mortgages, are under threat of foreclosure or already bank-owned will continue to decrease in 2013.

For those of us who make our living selling real estate, we will need to be diligent in assisting homeowners who want to move up or down. We are experiencing a truly active and competitive real estate market that may bring good results for the homeowners who are ready to move on.

Listings, Pendings, Back-ups - January 1, 2013

January 2, 2013
As we begin a new year, here are the numbers for the active listings, those in escrow either as pending or back-up and the ratio of pendings to listings. I am also including the January 1, 2012 numbers which clearly indicate how the number of active listings has plummeted.
Banning/Beaumont.......2013 List/194......Pend/200......Back-up.85......Ratio/1.395
                                   2012 List/437......Pend/169......Back-up /104...Ratio/,625
Bloomington................2013 List/18........Pend/47........Back-up/19......Ratio/1.270
                                   2012 List/59........Pend/43........Back-up/18......Ratio/1.034
Colton.........................2013 List/34........Pend/68........Back-up/33......Ratio/1.015
                                   2012 List/92........Pend/85........Back-up/35......Ratio/1.304
Fontana.......................2013 List/132......Pend/479......Back-up/169....Ratio/1.591
                                   2012 List/552......Pend/429......Back-up/205....Ratio/1.149
Grand Terrace.............2013 List/13........Pend/23........Back-up/10......Ratio/1.000
                                   2012 List/36........Pend/30........Back-up/16......Ratio/1.353
Highland......................2013 List/52........Pend/110......Back-up/43......Ratio/1.158
                                   2012 List/134......Pend/100......Back-up/52......Ratio/1.134
Loma Linda.................2013 List/20........Pend/25........Back-up/12......Ratio/1.578
                                   2012 List/34........Pend/30........Back-up/16......Ratio/1.353
Mentone.....................2013 List/7...........Pend/17........Back-up/3........Ratio/2.822
                                   2012 List/29........Pend/17.........Back-up/7.......Ratio/.828
Moreno Valley............2013 List/149......Pend/428.......Back-up/148....Ratio/1.441
                                   2012 List/667......Pend/415.......Back-up/104....Ratio/.916
Redlands.....................2013 List /121.....Pend/99.........Back-up/57......Ratio/1.578
                                   2012 List/231......Pend/103.......Back-up/41......Ratio/.623
Rialto..........................2013 List/60........Pend/175.......Back-up/68......Ratio/1.367
                                   2012 list/293.......Pend/187.......Back-up/72......Ratio/.884
Riverside.....................2013 List/399......Pend/660.......Back-up/283....Ratio/1.033
                                   2012 List/1095....Pend/677.......Back-up/330....Ratio/.920
San Bernardino............2013 List/262.....Pend/366........Back-up/130....Ratio/1.071
                                    2012 List/614.....Pend/361.......Back-up/106.....Ratio/-761
Yucaipa/Calimesa........2013 List/95........Pend/111.......Back-up/65.......Ratio/1.441
                                    2012 List/203.....Pend/88.........Back-up/57.......Ratio/.714
Interestingly, the number of properties that are under contract and in escrow is not very much different this January from January 2012. It is the active listings that show a dramatic difference. The totals in each  category reall show what has happened to our inventory. I will post them tomorrow.

Welcome 2013

January 1, 2013
A Happy New Year to all. Lets make 2013 a year that briingss reconciliation to all and Joy to the World. To quote the English poet, Alfred Lord Tennyson, "Ring out the old, Ring in the new..." We, at CENTURT 21 Lois Lauer Realty are set to serve our clients and customers, our agents and staff. We have weathered the down times and enjoyed the up times. We serve your real estate needs at all times. 2013, Let's go!