Good News, Bad News…or, One man’s trash is another man’s treasure!

Good = Southern CA home sales skyrocketed a record-setting 65 percent in September, compared to a year ago! Wow!

Bad = However, the median price dipped below $300,000 - plunging more than 33 percent, according to DataQuick. Throughout the region a full 50 percent of all home sales were in some stage of foreclosure. That’s what is driving home prices down now. There’s plenty of demand…just too many foreclosures.

Good = The foreclosure numbers do show a 12 percent decline from August to September.

Bad =  ”Much of the 12 percent decrease in September can be attributed to changes in state laws that have at least temporarily slowed down the pace at which lenders are moving forward with foreclosures,” said James J. Saccacio, chief executive officer of RealtyTrac. “Most significantly, SB 1137 in California took effect in early September and requires lenders to make contact with borrowers at least 30 days before filing a Notice of Default (NOD). Follow this link to view current Torrance Foreclosures. In September, we saw California NODs drop 51 percent from the previous month”, he added.

That reduced number of foreclosures may not amount to a hill of beans, according to the blogger Sean O’Toole, founder/CEO of ForeclosureRadar.com.

“Be careful with drawing any conclusions from the declines. The reality is that this only delays the process, and unless lenders radically change their position on loan modifications with principal balance reductions, it will likely have little impact other than a delay of the inevitable,” O’Toole writes.

So, trash for South Bay sellers and treasures for South Bay buyers! Call me to help you do either!

Ryan ‘Rocky’ Rockwood

310-809-0203

Ryanrockwood@kw.com

Pricing for last month’s buyers!

Have you heard of the phrase “chasing the market”? It’s the all-too-common practice of sellers in the South Bay in this declining market where they realize the lost value about 30 days too late. Then, the resultant price reduction is enough to have satisfied last month’s buyers…but not next month’s buyers…and the cycle get s repeated again and again until the seller feels they’ve made huge concessions and the market still yawns!
The antidote for this malady is to have an open and frank conversation about pricing before listing the property. 5 key elements:

1. The market determines the price. Not the owner, not the realtor, not the appraiser…the market. That is, there is a certain amount of $ that a well-informed, qualified buyer will pay for your property in today’s real estate market…
2. Professionally marketed, the home will be seen by 60% of qualified potential buyers within the first 15 days. The initial listing period is extremely important. For a variety of reasons, interest in the property diminishes dramatically after 15 days. 
3. Buyers shop by price range. They search the internet by price range and stipulate a price range to their agents. Agents automatically notify buyers of available homes in their price range. If you overprice your property, by as little as 10%, you will miss as much as 50% of the qualified early viewers. 
4. Property valuation is an art and a science. So, take your love for the home and appreciation for how special it is and couple that with the objective analysis of an appraiser (in declining markets I always pay for an appraisal of my listings upfront) and your Broker’s Price Opinion (BPO). 
5. Price should be calculated to accomplish your goals…speed of sale vs. net.. In a declining market there are just two alternative goals - fast and WRONG. Later in the season is not good, later in the year is not good…later is not good. Your equity is diminishing…whether it’s at 1% per month on the Palos Verdes Peninsula, or 3% per month in Carson. You need to sell quickly or lose. 

I’m writing this from an open house (mls # Z08100276) that I am conducting for a friend. It started on the market 115days ago at $2.45MM and has “chased the market” to $1.89M today. The number of internet site visitors, sign calls, and open house visitors has dramatically declined and the sellers would probably entertain an offer 10% below list price.  I guarantee that, had they offered the home for $1.69MM 115 days ago, they would have had multiple offers and sold it within days.

It’s so easy when it’s not your own money!!!

Mike “Rocky” Rockwood is part of the father/son real estate group, The Rockwood Group. Torrance home buyers and home sellers can reach the Rocky Rockwood Group at 310-809-0203 or Ryanrockwood@kw.com.

The first question you should ask yourself is why you want to invest in South Bay real estate. Most people are seeking financial independence. Some people want their assets to grow, some want an ongoing income stream and some want tax advantages. The good news about Real Estate is you can have all three!

Many people save and invest their entire working lives so that they can retire with enough money to live whatever lifestyle they want when they stop working. The big question is “How much money do I need to put away to support that lifestyle?” Well, if you want to have $100,000 a year to live on, you will need to have about 20 times that ($2,000,000) invested to meet that income need at retirement. Then, whatever annual dollar amount you need today, you will probably need double that every 15 years. 

One of the best things about real estate investing is it offers you leverage. Think of it this way, if you have $10,000 invested in a stock or bond that returns 5%, you will earn a 5% return or $500. If you put $10,000 down on a $200,000 piece of property and it goes up 5%, you just doubled your money or $10,000. That’s 100% return! Then, if you take into consideration that you could have received some cash flow, and your tenants are paying down your loan, and you get to write off depreciation and other expenses, 200% annual returns are not uncommon.

A good indicator for buying cash flow properties is what we call a “cash on cash” return. If it took $10,000 out of your pocket to buy a property that cash flows $250 a month ($3,000 a year), that’s a 30% return on your cash. 

The first thing that needs to be done is to find out how much money you can borrow. You need to talk to a lender that is familiar with investment real estate. A good lender can advise you as to what strategies you should employ based on your credit scores, savings and income. Once you know what you can qualify for, then you are ready to go on to the next step.

Determining which is the right area to invest is the next step. If you are primarily looking for appreciation, you will want to focus on the high-demand coastal areas. If you are looking for cash flow you may want to look in more established areas inland. I always advise looking for homes/units near major transportation centers or employment centers or universities, etc. 

Finally, you need to conduct due diligence. There are no short cuts here. It’s very important to investigate what you intend to invest in. What is the property really worth, what are the vacancy rates, what are the property tax rates, what does the owner typically pay for - utilities, lawn care, etc., is there a Home Owners Association and how will you manage the property and how much will a management company cost you?

The South Bay is a region just South of the City of Los Angeles that encompasses the smaller regional areas Beach Cities and the Palos Verdes Peninsula. Torrance is a large enough city that it is usually not included in these subcategories of the South Bay.

1504 Felton lane, Redondo Beach, CA: Fresh Home listing.

Contact Rocky Rockwood to learn more about this home(and other similar South Bay Real Estate bargains)

Breaking news: The buyer on this home has decided to move on to another property. Call now to register for an interest list as this home may return to the market in the next 24-hours. Rocky is at 310-809-0203.

Redondo Beach living at Inland prices! Wow, checkout this lovely 4-bedroom single family home that just became available in Redondo Beach, CA. Upgraded extensively, lovingly cared for and meticulously maintained this is an amazing opportunity. Act quickly, please! Kitchen has been entirely remodelled recently. Bathrooms are completely redone. Hardwood, travertine and tile floors throughout the house are in great shape. Walls are painted in modern colors. Upgraded light fixtures and ceiling fans in almost every room. Attached 2 car garage has ample room & additional 3-car parking outside. Backyard is completely enclosed & perfect for kids and animals. Bonus: Outdoor living space on top of the garage is completely surrounded by gates for safety.

Recorded Information line 24/7 call: 800-809-0271 ext 2108

Looking for a Bargain with Your Second Home in South Bay

The current American real estate market is no longer monopolized by the upper classes. Indeed, the boom in the American real estate industry has been due largely to the increasing participation of middle-income Americans. These middle-income Americans have jumped in on the trend of owning second homes. They usually choose to invest on second homes located outside of their home state, such as in the Palos Verdes Peninsula area (Palos Verdes Estates, Rancho Palos Verdes, Rolling Hills and Rolling Hills Estates), the Beach Cities area (Manhattan Beach, Hermosa Beach and Redondo Beach),or another other area in South Bay (Lomita, San Pedro and Torrance).

There are people who jump into the real estate investment business head first with very little information about what they should invest on in South Bay and how to properly go about it. The first thing that must be put into consideration is how much you can afford in purchasing your second home in the South Bay area. A budget should be taken into consideration, as this defines the limits of what you can and cannot buy; it might be the difference between purchasing a home in San Pedro or Redondo Beach. This amount that you can spend on a second home usually depends on your economic well-being. However, there are a variety of factors that contribute to the shifts in house prices.

Read Also: Turn your Torrance Second Home into a Vacation Rental

Location! Location! Location!

If you want a home near a picturesque spot in the Beach Cities for instance, or in a locale that is frequented by tourists, it is likely that these South Bay homes will cost more than homes located elsewhere in South Bay.

Important Things to Consider When Buying a Second Home

Once you’ve decided to purchase your second home, look for communities that offer owners an environment with sufficient facilities. Facilities and amenities include not only places to buy supplies, but also laundry, food, and cleaning services. Being in the proximity of structures that offer amenities can spell the difference between living in a box and living comfortably in your second home. Your home’s value obviously increases should it be found near skiing sites, golf courses, or beach areas. Advertising your second home for rent can benefit from proximate locations that may be of interest to vacationers in the area.

Read Also: For all those South Bay Frustrated Time Share Owners….

Many people want to buy second homes just so they can have a place they can call home away from their real domiciles. Before you jump in, you should consider the facilities that are near the South Bay home. This is because it is unlikely that you will want to do chores in your second home when you are there on vacation. Services to take care of cleaning your house, doing your laundry, or cooking meals should be found near the area before you finalize a deal to buy a second home in South Bay. That way, you can comfortably enjoy your vacation while your basic needs are being fully serviced at the same time.

More importantly, choose a home in a South Bay community in which you feel comfortable and safe. Some basic considerations that buyers of new homes always keep in mind are low crime rates, the friendliness of the roads for pedestrians, and the like. If you want to sell the South Bay home in the future, the resale worth of the house should be considered: choose a house in a South Bay community where real estate property prices are expected to increase over time. This is the best way to ensure a good resale price once you choose to sell the house.

Manhattan Beach Real Estate Investing: What is a VA Loan Foreclosure?

A quick check of a VA loan foreclosure will reveal that this isn’t made to be understood at first glance. Just like anything in this world, a complete understanding of what foreclosure and repossession is will require a second or a third look on the matter. Though repossession and foreclosures may not copy the usual characteristics that come with real estate buying in Manhattan Beach, there are still some features that make repossession and foreclosures unique.

Read Also: Torrance California VA Home Foreclosures

Here are some features that help make repossessions a league different from real estate buying; you don’t need shell out money for a down payment and interest rates used are low.

Tell someone that his Manhattan Beach property will be repossessed and chances are, he will be alarmed and frightened. And who wouldn’t be? A property will be lost, and if it’s their home then tomorrow they will not have a shelter that they can call their own. The news of foreclosure brings images of homelessness, but it should be remembered as well that there is something good that will come out of this bad dream.

Read Also: Torrance California Short Sales - Is it right for you?

VA Loan Foreclosures: A Not-So-Bad Concept

A number of other images and impressions will register on different persons when they hear the words “foreclosure” and “repossession.” Though these may produce conflicting feelings, there is one thing that that emanates from it that shouldn’t be dismissed outright. That one thing is the fact that foreclosures like the VA loan foreclosure isn’t always negative. It may share the stage with loans and mortgages, but there is something good about this concept.

Read Also: Torrance California Mortgage for those that are credit challenged!

What is good in a thing wherein a person is going to lose his property? Just remember that the goodness lies in the fact that another person can take advantage of the property at a lower price. This realization alone should push a person to think more about the concept of repossession and foreclosures and help erase some of the negativity that was traditionally attached to the concept.

Foreclosures and repossessions like the VA loan foreclosures are true and there is no escaping these things. The only thing that a person can do is to accept the fact that he no longer has the capability to continue owning his Manhattan Beach property. And for the other parties around, this can be a source of hope as well. Why is this so? It’s because the repossession market can be their lifesaver; a place where they can find their shelter at significantly lower price. The cost of getting a house using this market is lower compared with the traditional way of getting properties in the real estate market. If you are one of those who are searching for a home in Manhattan Beach, then let the Department of Veteran Affairs help you.

There is goodness in knowing what VA loan foreclosure is and here are some things that can help you change your mind about loan foreclosure coming from VA.

• Closing costs will be handled for you.
• Savings are realized and there is no need to insurance like private mortgage insurance.
• Equity is automatically given if you decide to purchase the Manhattan Beach property.
• Financing will be offered the moment the sale of the reposed home is deemed successful.

This is the avenue that you should take if you are thinking of getting cheaper properties in Palos Verdes Peninsula. VA loan foreclosure is your platform when seeking cheaper properties and homes.

Having a Good Real Estate Lawyer Pays When You’re In the Torrance Real Estate Business

If you are in the business of real estate in the Torrance area, it presupposes that you have at your service an all-around California real estate lawyer who is good and flexible enough to make any situation to work for you. Your real estate lawyer not only craftily troubleshoots any of your business problems but also perfectly handles the myriad needs of property owners and tenants. After all, his responsibilities extend to as far as attending to the rudiments required when your Torrance properties are damaged or when ill-fortuned events occur on someone’s property.

What Will a Real Estate Lawyer Do for You?

Your California real estate lawyer is the person behind the scene whenever a mortgage company is to be put on sale, sold, and the terms agreed on by the parties involved. When somebody wants to have a lien released or you want to free yourself from a signed contract, it is your real estate lawyer’s expertise that clears out the picture. In the same way, if a property owner in Redondo Beach, for instance, wants to have payment terms increased even before the agreed upon period, your real estate lawyer haggles with the tenant on the new terms and avoids putting you as owner under bad light.

Likewise, your real estate lawyer frees you from a lease contract’s fine prints. One very interesting case of these contractual hazards involves dividing properties during divorce cases. Your real estate lawyer becomes an ubiquitous fixture in almost all the agreement proceedings: making sure that all the required documents have been prepared and processed so that the right Torrance properties get to the right person and everybody’s happy getting their share of the bounty.

Read Also: Torrance House Values Affect Divorce Rate

The real estate lawyer arbiters when clashes of interest arise, too, like when one pushes for a sale while the other sticks to holding the owning rights. For such instances, the one pushing for the sale usually pays the other who stands firm on having the rights to own.

Your real estate lawyer attests to the agreement in the same manner as when he middlepersons when damages or disputes suddenly arise when everything was clear during the time of sale. As your real estate lawyer proves that sellers knew of damages or possible problems surrounding the Torrance property, you are saved from impending capital losses, deafening complaints from tenants, and the terrible hassles of facilitating unnecessary repairs, not to mention the costs involved.

Your well-rounded California real estate lawyer assures you get your money back plus from any transaction, whether from sellers, tenants, or damages. Any clever real estate lawyer can prove such things as unmentioned damages during the time of purchase, valid insurance claims, and arranges that you get your claims well and on time. Thus, your California real estate lawyer then is not only your best defense but also your best dispute-handler, especially during insurance claims.

As often happens, insurance companies hold suspect any insurance claimants-until the best Torrance real estate lawyer in your service steps forward for you.

Thinking of Real Estate Ownership in the South Bay Area?

If you’ve always wanted to own a home in the South Bay area, in the one of the Beach Cities (Manhattan Beach, Hermosa Beach and Redondo Beach) for instance, you can do just that through the rent to own home arrangement.

What’s a rent to own home arrangement in South Bay? It’s similar to the rent to own car arrangement. In a rent to own car arrangement, you rent the car for a specified period. If you like the car during this period, you can proceed with purchasing the car.

In the same vein, you can initially rent a South Bay area home. By actually living in the property, you can determine the actual conditions of the house prior to buying it. The benefit of the rent to own home arrangement is therefore a good way of investing in real estate.

Consider the Rent to Own Home Arrangement in South Bay Area!

The rent to own home arrangement has been growing in appeal with many people, and business in this area has been vigorous. It may be attributed to the advantages of this arrangement for the parties involved.

• One advantage would be that you can gather all the information you need about the South Bay home and the neighborhood by actually residing in the house.
• A lower down payment is also another benefit, as compared to the higher down payments on straight property purchases. Thus, if you’re an inexperienced homebuyer or investor, the rent to own home arrangement is a good strategy in determining real estate investments.

Features of the Rent to Own Home Arrangement

Both sellers and buyers in South Bay can benefit from the rent to own home arrangement. The following are some of the features of the rent to own home arrangement:

• The current market largely influences the sale price and the rent price of the property. However, bargaining and negotiations may always be done. Thus, do some research on the South Bay property prior to closing the deal.
• The option period is a very significant consideration. As a buyer, you would want a longer option period, giving you time to repair your credit and build up your equity. A seller, on the other hand, prefers a short option period so that the house can be sold quickly. Nevertheless, any of the options can flop on either of the parties involved. Therefore, market awareness and research is crucial.
• There have been instances when a seller has replaced the current buyer with another person offering a higher price. Thus, when the rent to own home contract is being formulated, it is important for you, the buyer to guard your welfare. Ensure that the contract includes a clause or provision regarding preservation of the price during the option period.
• Generally, a seller prefer quick cash sales. However, the rent to own home option is also profitable for him. Through this option, the seller can earn significant income from the property prior to actually selling it.
• Even when the house is not eventually purchased, the seller can still profit from the rent to own home arrangement through the option fee and rent payments. In addition, he also receives a tax deduction on his mortgage interests during the option period.

In summary, the rent to own home arrangement can benefit both the buyer and the seller. It’s a practical means to investing in real estate in the South Bay area. Think this might be an option you would like to explore in the South Bay? Call us today at (310) 809-0203, we would love to assist you!

Additional Reading:

• Buy property from the Bank and pocket the profits in Hermosa Beach!
• Foreclosure & Fixer Homes for Sale in Redondo Beach, Torrance and San Pedro
• The Darkside of Manhattan Beach Foreclosure
• Now you can own the ultimate MLS map of the South Bay, available exclusively to Realtors!

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Listen up Hermosa Beach CA!

The daily newscasters and “talking heads” feature regular stories of the tragedy of foreclosures in California. Indeed, the rate of foreclosures is continuing to increase, partially driven by the financially illogical variable rate mortgages. With that said, if you are a financially savvy Hermosa Beach Real Estate Investor with solid financials, this is a great time to capitalize upon these intriguing opportunities, especially in the form of REO properties.

California Banks are in the business of lending money, not owning, managing, or selling real estate. However, oftentimes a bank is forced to foreclose on an investment, and a property reverts from an investment to Real Estate Owned, or REO.

Hermosa Beach Real estate investors can purchase REO properties from banks for less than the full market value of the property, but in most cases, REO properties are sold by lenders at or just below market value. A smart Los Angeles investor will have a strong strategic plan for bidding on and financing a bank-owned property to get the best value.

Bidding on REO property

Even though banks do not want to hold and manage Hermosa Beach real estate properties, there is a wide misconception that banks want to ‘dump’ REO properties at far below the market value simply to get if off the books. Closer to the truth is the fact that a REO property is not considered a liability, and banks will want to get full or near market value for their asset.

If a Hermosa Beach Real Estate Investor makes an offer on a REO property lower than the bank’s calculated full market value, the bank will probably make a counter-offer closer to the market value at which they want to sell. An important thing for investors to remember is that banks do want to sell their REO properties as quickly as possible, so patience and persistent bidding is the key for a potential investor to get a good deal. But also remember that a bank is looking after their own best interests - not yours.

Understand that REO is “as is” property

Banks will usually sell their REO properties in “as is” condition, meaning if there are any renovations or repairs needed in order to qualify for traditional financing, a bank will not perform the repairs. They may, however, offer a credit on the sale price for the deferred maintenance of a property.

Los Angeles area Investors should analyze a South Bay property carefully and have thorough inspections performed by licensed inspection firms. A proper inspection will reveal items that an investor will need to consider improving before the property can be achieve full resale or rentable value.

If a Hermosa Beach property has numerous defects and does not qualify for a traditional mortgage from a bank or other lender, a real estate investor will need an alternate plan to finance the property. The Hermosa Beach investor should form a plan for repairs and renovations and could work with partners to invest money in the fix up project. Hard moneylenders may also be a source of short-term financing.

Enjoy favorable terms

A Los Angeles investor will often reap favorable sale terms from a bank REO property. The South Bay properties are usually clear of any prior liens. Additionally, a bank may offer financing to an investor will favorable terms, such as low down payment or low interest rate.

Swift closings can also be a great benefit since the title will be owned free and clear by the bank.

Benefits of buying REO

As previously mentioned, a REO home is generally free of all liens from prior lenders and contractors. Having a home for sale free and clear offers a safe investment and quicker closing times.

A REO property will also be vacant and ready for an investor to occupy or begin renovations immediately after the sale. Any owners or tenants will already have been evicted prior to the final foreclosure. Tip provided by Real estate expert Brice Sheppard.

REO properties can be a great investment - as long as an investor is savvy about purchase strategies. Knowing the condition of the property and bank REO selling procedures is an asset to the investor. With a little experience, a real estate investor can reap many financial rewards with a niche in REO properties.

In Foreclosure: San Pedro Townhouse value

Wow, this San Pedro townhouse is in foreclosure and could go for as low as $225,000. That would be wild but it could happen. This foreclosure home was recently appraised at $360,000. One persons loss is another persons gain. Jump on the best value in San Pedro Real Estate out there. The San Pedro home even has an extra loft that could be used as an extra bedroom. This San Pedro townhouse has 1 bedroom plus a loft.. Gorgeous gated community sits on San Pedro / Rancho Palos Verdes border.

San Pedro Foreclosure Home Bargain

The current buyer of this beautify San Pedro home recently went bye-bye. Now we are eager to find the next homeowner looking to purchase a foreclosure in the San Pedro real estate market. This home in the Enclave Gated Community of San Pedro is adjacent to Rancho Palos Verdes and is just 11-years old. It boasts more than 2000 sqft 3/3. A similar home just down the block is currently in escrow for $617,000. This home will go to someone looking for a real estate bargain in San Pedro. Current asking price is $600,000 but this will probably drop!