Los Angeles and South Bay Real Estate Video Blog with Lenny LaRocca

What does our team do differently when we represent our clients? Today, let me explain. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report All of us at the LaRocca Real Estate Group feel very fortunate to have the opportunity to serve all of you. Today, I’d like to talk about how our service differs from that of others in our industry. First of all, communication is a No.1 priority for our team. Whether it be in real estate, family, or friendships, communication is important. For us, quality communication means being timely and direct. But there are a number of other things we do differently. We’re also a very structured group. Every member of our team is professionally coached, and we have a specific plan of action we follow for every one of our transactions.   This plan isn’t new, though. It has been used in the real estate industry for more than 40 years. The difference our team brings to this plan is the people we have executing it. Of course, before we can execute this plan, we have to generate buyer leads. One question we frequently hear from sellers is how we generate these leads. They want to know where our buyers come from. What does our team do differently when we represent our clients? Today, let me explain. About 40% of buyers may come from another agent or broker in the community a listing is in. Buyers also come to us after having seen signs outside of properties. Many people think that buyers come from open houses, but this isn’t typically the case. Because our market is so competitive right now, buyers really need to be prepared ahead of time if they want to be successful. The most important thing a buyer can do is to get pre-approved with a reputable lender. If you have any other questions, would like more information, or are interested in letting us represent you during your real estate transaction, feel free to give me a call or send me an email. I look forward to hearing from you soon.

The 2018 real estate market started out with a bang. How are market conditions for buyers and sellers right now? Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report What’s happening in the February real estate market? The new year started out with a bang. Historically, the market is slow at the start of the year and picks up towards the end of January or February. Right after January 1, 2018, we saw an increase in the number of homes for sale and the number of properties going under contract. All in all, the market remains strong. The economy continues to roar. However, the Feds are going to increase interest rates over the course of 2018, which will impact buyers and sellers. There are still a few favorable elements in our market for sellers. We are currently running around 18% less inventory for sale compared to this time last year, and we know that 2017 had even less inventory than the year before that. As a result, prices will remain high and strong, which is great news for sellers. Additionally, millennials are starting to enter the market, which is a strong element for our economy. That said, it looks like 2018 will continue in a seller’s market. All in all, the market remains strong. If you are a buyer, the good news is that interest rates remain low at around 4.25%. The bad news is that limited inventory leads to more competition, so you need to have all your ducks in a row when you enter the market. The other bad news for buyers is that the Fed has announced that they will increase rates again in 2018. Rates are expected to go up three to four times between now and the end of the year. Because we are running low inventory and buyers are having a hard time finding properties, we are starting to see more activity with pocket listings. By definition, a pocket listing is when a seller wants to sell but doesn’t want to go through the rigamarole of putting their house on the MLS and dealing with showings. We are definitely seeing an increase in pocket listings in the immediate market. In 2017, 15+% of homes sold were pocket listings. That means if you’re not working with a real estate professional who’s tapped into the real estate community, you will probably not know about these opportunities to buy a home. If you have any other questions about buying or selling a home in 2018, just give me a call or send me an email. I would be happy to help you!

According to the latest statistics, it’s a seller’s market in LA County as we begin 2018, but there is good news for buyers as well. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report As we head through January 2018, the latest statistics tell us we’re in a seller’s market. There were 818 homes sold in December 2017, which was a decrease of 18% compared to both November 2017 and December 2016. The total number of homes closed in December 2017 was 701 units, which was down 4.5% compared to November 2017 and 8.2% compared to December 2016. There were 530 homes placed under contract in December 2017, which was a staggering drop of 23.7% compared to November 2017 but an increase of 4.5% compared to December 2016. Most of these statistics were taken from South LA County and, specifically, the South Bay. These numbers lead me to believe that we’ll continue to have a shortage of inventory and have a very active market as long as interest rates cooperate. In December 2017, the average price per square foot continued to appreciate and settled at $549. The average days on market in December 2017 was 35 days, which was a 2.8% drop compared to November 2017 and a 23.9% drop compared to last year. The average list price for homes in December 2017 was $1,755,000, but the average sold price was $929,000. That average sold price dropped 1.1% compared to November 2017 but increased 8.3% compared to December 2016. Lastly, our average inventory for December 2017 was 1.2 months, which was a 14.6% drop compared to November 2017 and a 7.7% drop compared to December 2016. 2018 will be a fantastic year for buyers and sellers. According to a five-year study comparing the homes for sale versus the homes that have sold and those that are pending, we started and ended each year between 2012 and 2017 with a low level of inventory. In December of those years, we had between 600 and 800 homes listed for sale. As those years progressed, we usually saw a 20% to 25% increase in inventory. All in all, 2018 will be a fantastic year whether you’re a buyer or a seller. Prices will continue to remain strong for sellers, and buyers can still take advantage of interest rates near the 4% mark. If you have any more questions about our current market or you’re thinking of buying or selling a home soon, don’t hesitate to call or email me. I’d love to help you.

If you have to relist your home because your previous transaction fell out of escrow, there are three things that can dramatically affect its sale. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report We are in a highly competitive seller’s market right now. The ball is in the seller’s court, which means that most of the time they can choose which offer to accept, the closing date to settle on, and which improvements will be made to the house prior to the sale. However, it’s important to remember as a seller that you don’t go too far and cross the line. There are many factors that can affect the sale of a home while in escrow. For one thing, interest rates can change and bump the buyer out of contract. The buyer’s financing may also fall through due to a financial hardship or a loss of employment. The appraisal could also not come in as high as the agreed-upon price. All of these examples are good reasons that sellers and buyers work together to make sure the sale is completed. Be advised that though the market is good, inventory levels have risen a little bit. Part of that can be attributed to the end-of-year holiday cycle, but buyer demand is still high and sellers can still negotiate the best deal for them. A buyer in hand is worth two in the bush. Should a transaction fall out of escrow, though, there are three factors that can dramatically affect your ability to resell your property: 1. Because the property was in escrow and off the market for two to six weeks, it’s not considered “fresh” in the eyes of buyers. 2. Statistically, the next offer you get will probably be lower than your original offer. 3. A new buyer means you have a whole new set of circumstances and a new inspector who may recommend different repairs on top of the ones you already made for the previous buyer. Even though we’re in a strong market, we like to remind our sellers of the following adage: A buyer in hand is worth two in the bush. Even though the adage doesn’t quite apply, the message is clear. If you have any questions about things that can affect your home sale or you have any other real estate needs, don’t hesitate to reach out to me. I’d be glad to help you.

According to the latest statistics, we may be on the verge of a market shift. However, it’s still a great time to both buy and sell in the South Bay marketplace. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report My team and I believe we’re seeing the signs of an early market shift, and I have the numbers to prove it. If you follow along in the video above, you’ll see several graphics with statistics that reflect the year-to-date results of our market through September 2017. Let’s start with home sales. There were 1,360 homes for sale in September 2017, which was a decrease of 1% compared to August 2017 and an 11% decrease compared to September 2016. The number of homes closed in September 2017 totaled 861 units, which was an 11.2% decrease compared to August 2017 but a 3.6% increase compared to September 2016. There were 883 homes placed under contract in September 2017, which was a 3.6% decrease compared August 2017 but an 11% increase compared to September 2016. The average price per square foot in September 2017 was $525, which was a 1.1% drop from August 2017 but an 11% rise compared to September 2016. We’ve had a shortage of inventory throughout most of 2017, so that 11% year over year increase shows that buyers are more active and paying a premium for available homes. The average days on market for September 2017 was 33 days, which was a 6.5% rise compared to August 2017 but a 29.8% drop compared to September 2016. Buyers are more active than they were a year ago, but because we’re seeing a month-to-month slowdown, I believe that slowdown will continue. Properties in September 2017 sold at about 97% of their list price, but that number had been dropping over the last month or two, which is another indicator of a market slowdown. We’re still in a seller’s market, but now is a great time to buy or sell. The average active sales price per square foot for September 2017 was $1,654, which represents a 1% drop compared to August 2017 but a 10.6% spike compared to September 2016. The average sold price per square foot for September 2017 was $922, which was a decrease of 3.5% compared to August 2017 and 14.5% increase compared to September 2016. These statistics explain why whenever my clients ask me how much our market has appreciated from 2016 to 2017, I say a fair answer is about 10% to 11%. Lastly, we’re averaging about 1.6 months’ worth of inventory for September 2017, which is up 14.4% compared to August 2017 but down 11% compared to September 2016. As these numbers show, we’re still in a seller’s market, but now is a great time to buy or sell. Mortgage rates are still hovering around 4%, and our economy is still robust. If you’re a seller or an investor who wants to lock down your gain from the past three, five, or seven years of appreciation, this is without a doubt the market to do that. If you have any other questions about our market or you’re thinking of buying or selling in the Los Angeles County/South Bay marketplace, don’t hesitate to reach out to me. I’d love to help you.

Some real estate terms can be daunting to buyers. My goal is to help you understand them better, so you can navigate the process more comfortably. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report Searching for a home can be an intimidating process, especially with regards to the language that comes up during a real estate transaction. For today’s topic, I’ll be providing a short glossary of key real estate terms you should know as a homebuyer. My goal is to make you feel more comfortable with some of the basic terminology. Closing costs: The cost to complete the real estate transaction. These costs are in addition to the price of your home. Some examples could be your loan, the closing cost points on your loan, transaction fees, escrow costs, etc. Appraisal: A professional analysis used by your bank to estimate the value of your property. This includes examples of similar homes that sold in your immediate market. Credit score: A number ranging from 350 to 850 that is based on an analysis of your credit history. Your credit history plays a significant part in securing a home mortgage; it helps the lenders determine how much of a loan you would qualify for. Many buyers believe you need a score over 780 in order to get a good home loan, but in fact, over 55% of all the home loans are done with buyers with FICO scores less than 750. Down payment: A portion of the cost of the home paid up front to secure the purchase of the property. A down payment varies widely depending on where you are in the US, and how competitive you want to be in your presentation of your offer to buy a home. I’d love to elaborate more on that specifically with you, so give me a call. Escrow: The holding of money or documents by a neutral third party for closing. Mortgage interest rate: The interest rate you pay to borrow the money you need to buy your home. Pre-approval letter: A letter from a mortgage lender indicating you qualify for a loan for a specific amount and that your income and assets have been verified. This letter is a must-have in the highly competitive market we’re in. We as real estate agents want to help you get through this sometimes confusing process. The negotiation of the transaction can also be overwhelming, but we’re here to help you. If we can assist you in any way regarding buying or selling a home, please reach out to me and I’d love to help you out.

The length of homeownership is rising both here in California and across the United States. So, why is this happening and what does it mean for the real estate market? Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report Length of homeownership has increased not only here in California, but nationwide. A recent study conducted by the Adam Data Solutions Group collected information from 11 major metropolitan cities in California, and it found that the typical length of homeownership is almost two years longer than the previous average of five to seven years. Nationally, the length of homeownership has increased by about a year and a half. Today, I’d like to take a look at some of our nearby counties. In Los Angeles and Orange County, the average length of homeownership in 2012 was 7.11 years. As of March of this year, the average length of homeownership in those same counties is now at 9.59 years. So, why has this change taken place? Many people believe the recent recession has a lot to do with it. As I like to say, many homeowners may not love their home, but they do love their mortgage. Other areas saw similar changes. San Francisco went from 7.72 years of ownership in 2012 to 9.95 years today. Also, Silicon Valley went from 5.75 years in 2012 to 9.79 years in 2017. This shows us a fairly consistent trend across many major cities in California. Let’s also take a look at San Diego. In 2012, the average length of homeownership in San Diego was 7.3 years. Now, the average length of homeownership in San Diego is up to 9.43 years. We’re seeing a very healthy market, so now is the time to make your move. One of the things this trend tells me is that now is the time to sell. This is something I advise strongly to my sellers, since today’s inventory is low and demand is strong. Low interest rates are also playing a key role in buyer appetites on the market. At the beginning of 2017, we predicted that a lot of buyer consumption on the market would be coming from millennials. This has happened to a degree, but not yet to the extent that many assumed would be the case. All this just goes to show that you shouldn’t wait around on what you expect might happen from the market. For example, a lot of my buyers have been asking me if I think they should wait for prices to drop. However, my advice to buyers is not to wait. You never know where interest rates or the economy will be tomorrow. Now is the time to make your move. We’re seeing a very healthy market with great interest rates. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

A lot has changed in our market in the last month, let alone the last year. We’ll go over all the changes for you today. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report A lot of changes have been happening in the LA South Bay market recently, and I wanted to give you an update today on what’s been going on. In essence, we have a very strong market, like most other markets in Southern California. However, our limited supply of sellable inventory is making the buying and selling processes a little more intense these days. Here are some of the numbers you should be aware of: Our inventory based on closed sales is up 14.7% from last month, but down 23.5% from last year. There were 1,405 homes for sale in July, which is down 18.6% from last year. There were 875 closed units in July, which is down 16% from last month, but up 7.8% from this time last year. The 1,019 homes under contract are up 4.6% from last month and 23.1% from last year. Our average days on market is down 44% from last year and now sits at just 28 days. Our inventory based on closed sales is up 14.7% from last month, but down 23.5% from last year. Our market continues to remain strong. All in all, our market continues to remain strong for buyers and sellers. If you price your home correctly, it will sell quickly and profitably. If you’re a buyer, interest rates remain low and you have a great opportunity to lock in a rate now. However, competition will be fierce. Keep an eye on our diminishing inventory, because it plays a huge role in your decision to buy or sell. If you have any questions for us or you’re thinking about buying or selling yourself, give me a call or send me an email. I look forward to hearing from you.

Today I wanted to take some time to clarify the difference between fixtures and personal property as it relates to a home sale. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report Occasionally, there can be situations in a home sale that can be frustrating for both the buyer and the seller. One specific situation deals with fixtures and personal items associated with the property. In the real estate industry, we called this real property versus personal property. Any good Realtor should know the difference between the two. Make sure that you and your Realtor are on the same page about what is a fixed item and what is personal property. A prime example of an item that isn’t a fixture is the washer/dryer set in a home. You cannot expect a seller to leave those items behind, as they are personal property. Furthermore, the legal definition of a fixture is anything that has been attached to the home and should be given to the buyer as part of the home sale. A way to determine whether something is a fixture is to look at how it’s attached to the property. If the item is nailed, glued, or screwed down, then it usually stays. Another way to look at it is if the item is an integral part of the home, then it will stay as it is a fixture and not personal property. How can personal property and fixtures be confused? A classic example is with the microwave. Many modern homes have built-in microwaves, but sometimes the homeowner will purchase their own microwave and set it on a shelf or in a cabinet. If the microwave were then built into the home and attached to the property, then it would stay with the home. Otherwise, it’s personal property that the homeowner can take with them. Make sure that you and your Realtor are on the same page. Items that cause the most issues are window treatments, swing sets, basketball hoops, mirrors, wall-mounted TVs, and light fixtures. It’s important to work with your agent to clarify what is included and excluded in the sale of your property. I find it helpful to list those items right in the listing contract and note those items specifically in the MLS to avoid any confusion later on. Some other items that might be confusing are extra paint that was used in the home, extra tile that was used to update the bathroom or the kitchen, and gardening items that relate to that home’s landscaping features. If you’re buying a property, make sure that you do a thorough final walkthrough with your agent before closing on the property. You want to make sure that those items that you noted when you made an offer on the home are still in place, and if they aren’t, make sure to bring that fact to the attention of your agent. If you have any additional questions about this topic or you’re looking to buy or sell a home, please give me a call. I would be happy to help you!

There are many tax benefits that homeowners get to take advantage of. I’ll cover a few that you should know about today. Looking to buy a Los Angeles home? Search all homes for sale  Selling your Los Angeles home? Get a FREE home value report There are many tax advantages that come with homeownership. We helped a record number of new homeowners this year, so we want you to know which tax deductions are available to you. By all means, please talk with your tax adviser before you actually handle these deductions on your annual return. 1. Mortgage interest: You can deduct the total amount of interest paid every year against your taxes. 2. The cost of your loan or loan points: You can deduct the cost of your loan or the points that you paid for that home loan against your current year tax return. In other words, those are 100% deductible in the year you actually bought the home. 3. Deductions for a home equity line of credit: If you take out a home equity line of credit to transfer some of your credit card debt and get a lower interest rate, then you can deduct that interest rate on your home equity line of credit. You cannot deduct the interest rate if it’s on your credit card. If you take out a home equity line of credit in order to make a substantial improvement to your home, you are also able to deduct the interest to the money used against your home equity line of credit. Remember, there are some limits on the deduction amounts for your home equity line of credit. The benchmark for couples is around $100,000 if they file together, and $50,000 when filing individually. That is a lot of interest that you can balance off of your taxes. 4. Property taxes: You can write off 100% of your property taxes. That includes both state and federal property taxes. Your property taxes are 100% deductible. There are a few other notable deductions that you may qualify for. Ask your tax adviser for more information about: Home office deduction Selling cost deduction Capital gains exclusion Moving costs (if you are relocating because of your job) Again, check with your tax adviser before you try to take advantage of any of these deductions so that you know exactly what you are getting into. If you have any other questions about the benefits of homeownership, tax or otherwise, just give us a call or send us an email. We would be happy to help you!