Los Angeles Real Estate

Home construction increased last month and applications for building permits also grew. The gains were driven mainly by apartment and condominium construction, not the much larger single-family homes sector.

Construction of new homes and apartments rose 10.5 percent in August from a month earlier to a seasonally adjusted annual rate of 598,000, the Commerce Department said Tuesday. That’s the highest level since April.

Pulling the figures up was a 32 percent monthly increase in the condominium and apartment market, a small portion of the market. Single-family homes, which represented about 73 percent of the market in August, grew more than 4 percent.
Housing starts are up 25 percent from their bottom in April 2009. But they remain 74 percent below their peak in January 2006. Single-family housing starts are up 11 percent from their low point in January 2009, but down 78 percent from their peak in January 2006.

Builders are struggling with weak demand for new homes caused by high unemployment and a glut of foreclosed homes on the market. They benefited in the spring from federal tax credits, but those expired in April.

Paul Dales, U.S. economist with Capital Economics, said the high number of vacant homes, mounting expectations of renewed price falls and economic constraints on households will continue to weigh on the industry.

“Homebuilding activity remains at an astoundingly weak level,” Dales said, adding that construction has to be more than double current levels for the market to be considered healthy.

Building permit applications, a sign of future activity, grew by nearly 2 percent to an annual rate of 569,000.

Lennar Corp., a major builder based in Miami, said Monday the number of buyers signing agreements to purchase its homes fell 15 percent from a year ago in the three months ended August 31.

“It’s been a tough summer,” said Stuart Miller, Lennar’s chief executive. on a conference call with investors Monday. “As we’ve gone into September, we’re seeing a little bit of pickup in our traffic, but that shouldn’t be cause to have a sigh of relief at this point.”

Construction activity rose 34 percent in the West and was up 22 percent in the Midwest and 7 percent in the South. However, construction fell by 24 percent in the Northeast.

On Monday, the National Association of Home Builders said its monthly index of builders’ sentiment was unchanged in September at 13. The index has now been at the lowest level since March 2009 for two straight months.

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

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Taking steps to minimize your energy use is not only good for the Earth, but for homeowners as well. While being altruistic and helping a cause generally means giving—not getting—back, going green provides noticeable benefits to everyone. Here, Mike Vazeii, Director or Marketing, American Home Shield discusses why going green is in fact a good thing.

Lowering energy consumption can be good for the planet and good for homeowners’ pocketbooks. That’s because taking steps to minimize energy use in the home can often significantly lower heating, cooling, water and utility bills and may have other financial advantages for you and for your clients.

It almost sounds too good to be true, doesn’t it? Being altruistic and helping a cause usually means giving—not getting—back. However, going green can help save the Earth and help save household budgets. Helping your clients decrease their carbon footprints and protect our natural resources while spending less is a tangible way of delivering extra service value to them.

For example, make sure your clients know they may be eligible for federal tax credits or tax incentives for the purchase of specific energy-efficient products or renewable energy systems for the home. Today, energy-efficient improvements can often be incorporated into home mortgages, enabling homeowners to pay for the upgrades over the life of the loan.

Depending on the lender, there may be additional advantages, such as lower mortgage rates or reduced loan fees. Energy Efficient Mortgages (EEMs) and Energy Improvement Mortgages (EIMs) are also available. Encourage your clients to check with a tax professional for tax credit and incentive qualification specifics, deadlines and eligibility requirements, and to consult with their local lender for mortgage information and guidelines. Websites such as www.energy.gov, www.energysavers.gov, www.energystar.gov and www.irs.gov also contain useful information.

You can help raise your clients’ awareness of the green compatibility in homes. For example, if you are showing a home that has skylights, be sure to mention that skylights decrease the need for artificial lighting and help warm the home during winter months, decreasing energy use. Home appliances with the Energy Star label meet and exceed minimum, strict energy efficiency government guidelines and can reduce energy consumption and lower utility bills. Even seemingly small things, like light switch dimmer controls and automatic occupancy sensors, can contribute to energy and monetary savings.

For energy-efficient ideas that your clients can incorporate into their own homes, visit www.Live-GreenSaveGreen.com. Living green and saving green is easy, fun and beneficial for everyone involved.

Your homeowners will be grateful for the conservation and cost-saving tips, and can appreciate the fact that you care enough about them and about our planet to share such useful information. You’ll find some helpful ideas for your own home, too. Find out for yourself and show your clients why living green isn’t only the right thing to do—it’s the smart thing to do.

From RIS Media

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

At a time of slumping home sales and a glut of unsold inventory, it’s hard to imagine how anyone could form a bullish take on the troubled U.S. housing market. Even though home prices have risen slightly in recent months, experts in charge of Standard & Poor’s Case-Shiller index, a crucial indicator of the health of the housing market, warned as recently as last month that the market remains weak. And some analysts think home prices could fall further by 15% to 20%.

But talk about real estate has shifted somewhat lately. It looks as if the contrarian view of the housing market is beginning to gain traction, if ever so slightly.

Credit Suisse says the worst is behind us and that fear of another hit on the housing market is just overreaction. The bank offers a few factors that could help home prices from here on out, including government support of about 70% of home mortgages that will likely keep prices from revisiting the nerve-wracking plunges seen in 2007 and 2008. Also, The Wall Street Journal’s Brett Arends earlier this week listed 10 reasons to buy a home, countering a recent Time Magazine cover story earlier this month that questioned the pros of homeownership. Arends lists everything from record low mortgage rates to savings on taxes to guarding against inflation.

All are worth noting, but one of the more striking bullish arguments come from an economist at Massachusetts Institute of Technology’s Center for Real Estate. Bill Wheaton, who thinks the housing market is poised to make a strong comeback, calls home construction “a sleeping giant that is about to wake up.”

Wheaton thinks much of the excess home inventory would either be sold, occupied or otherwise absorbed by 2013. But from 2011 onward, demand should return to pre-recession levels. What’s more, he says, the recovery of home construction could boost overall GDP at levels unseen during recoveries after previous recessions, with the exception of the massive building that happened right after World War II.

Not just a comeback, but a strong one

“Housing construction will not only rise, but it will stay high for a while, which didn’t happen in previous recoveries,” Wheaton says, commenting on a paper he wrote for the center in 2009. “It won’t just be a one or two year blip.”

So is Wheaton really onto something, especially at a time when so many people are jobless and housing units sit empty — an unknown number of which could eventually fall to foreclosure?

The crux of Wheaton’s argument lies in the rate of residential construction today. It’s been historically low – so low that he believes demand is actually exceeding the level of building going on. This helps set the grooves for a relatively large comeback in residential investment.

Here’s how Wheaton backs the imbalance of demand for housing units and residential construction.

He estimates that housing demand in 2009 was at about 1.1 million units – more than twice construction at the time. At this rate, the excess inventory will eventually be absorbed. “It’s going to be a long time before construction picks up with demand,” Wheaton says, adding that this should help housing prices. Foreclosures won’t stop anytime soon, he says, but demand will return to a more normal level, clearing out the inventory and eventually sparking more new construction.

Housing construction could hugely drive America’s economic growth over the next few years, Wheaton says. Residential investment as a share of GDP is relatively small, averaging about 3% to 4%. But given that there’s so little building going on today, it’s plausible housing construction could add an average of 0.7% to GDP growth per year over five years – a level far greater than what has been seen during recoveries of previous downturns.

Some might think Wheaton sounds way too bullish given what most experts are saying about America’s housing rut. He could be wrong. He might only be half-right. But the bull’s side is worth hearing as much as the bear’s.

From CNN Money

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

Though the proposed Westside subway extension is expected to provide substantial benefits for transit users, the multibillion-dollar project — contrary to one of its selling points — will do little to relieve traffic congestion in West Los Angeles or the county, a new environmental review shows.

Released Friday, the subway’s draft environmental impact report states that the project will give transit riders more options and allow them to travel across town much faster than the buses that serve the densely populated corridor along Wilshire Boulevard.

Transit officials estimate that a one-way subway trip from downtown Los Angeles to Westwood would take about 25 minutes, something that is now difficult to do in a car at rush hour. Buses make the trip in at least 50 minutes, a time that will only lengthen as Wilshire and parallel thoroughfares become increasingly choked with traffic in the future.The report shows, however, that in 2035, the subway extension will result in only a tiny reduction in automobile use. It notes that the San Diego Freeway, the Santa Monica Freeway and major streets along the line will remain heavily congested because of population growth and a lack of road improvements.

“Remarks that transit relieves traffic congestion are common, but they are without a factual basis,” said Tom Rubin, an independent transportation consultant and former transit agency executive in Southern California who was not involved in the report. “The roads in Los Angeles are so far over capacity, it is difficult to get improvement from new transit projects.”

Traffic relief has been one of the goals of the light-rail and subway projects planned and built by the Los Angeles County Metropolitan Transportation Authority. Elected officials and MTA board members, including Los Angeles Mayor Antonio Villaraigosa, have repeatedly said that the Westside subway extension, as well as other proposed rail projects, are needed to alleviate congestion and gridlock.

Though traffic congestion will remain a vexing problem, MTA officials say the subway extension will nevertheless provide a large incentive for motorists to break their automobile dependency because of shorter travel times and a longer route with stops at job centers, tourist attractions, cultural institutions and UCLA.

“We have shown that when we give the public new options, people get out of their cars,” said David Mieger, the extension’s project manager. “The subway will be a good alternative to the automobile. Why would you continue to drive?”

MTA officials also said that traffic congestion can be significantly addressed only through a broad approach that relies on subways, light-rail lines, more bus service, toll ways, better highway management and road improvements.

“The subway shouldn’t be viewed as a silver bullet,” said Marc Littman, an MTA spokesman.

The release of the subway’s draft environmental impact report marks the start of the document’s 45-day public comment period, which includes five hearings between Sept. 20 and Sept. 29. Written comments can be submitted to the MTA until Oct. 18. The report is posted on the MTA’s website at http://www.metro.net/westside.

The report analyzed a range of options, from not building a subway at all to five proposed routes, including a nine-mile extension to Westwood, a 12-mile path to Santa Monica and a 16-mile option that includes spurs to Santa Monica and West Hollywood. The estimated costs of the alternatives range from $4.2 billion to $9 billion.

A final environmental report will be prepared after MTA officials select a route on Oct. 28. Construction is scheduled to begin in 2012 and take until 2035 unless Villaraigosa wins federal support for a plan to speed completion of MTA projects.

According to the draft report, the annual miles traveled by motorists countrywide would decline a fraction of 1% if the extension to Westwood is built. The drop in miles traveled would be around 1% if the 16-mile option with spurs to Santa Monica and West Hollywood goes forward. The reductions are roughly the same for the Wilshire Boulevard area.

The report states that by 2035, the overall reduction in vehicle trips in the county will range from 10,000 to 18,000 a day, depending on the option that is built. However, that would be an insignificant amount considering that automobile trips are projected to increase to more than 26 million a day in the county by 2035, according to the Southern California Assn. of Governments.

The subway would do little to offset the increases in automobile travel predicted over the next 25 years in the county and the Wilshire Boulevard area. Fueled by population growth, the miles driven by motorists will rise almost 66% in the county and 26% in the area served by the subway extension. Already, highways, intersections and streets in West Los Angeles are among the most congested in the county.

In addition, Paul Sorensen, associate director of the transportation, space and technology program at Rand Corp., the Santa Monica-based think tank, cautioned that traffic reductions achieved by transit projects such as the Westside subway could fade over time.

From L.A. Times

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

Rising mortgage rates may seem like the last thing the economy needs right now. Then again, they may prove a tonic.

One indication of whether that may be the case will be the coming weekly tallies of mortgage-application activity from the Mortgage Bankers Association. While Wednesday’s release might not yet reflect the sudden, recent turn in bond yields, the data could soon show if the prospect of higher mortgage rates spurs consumers to buy homes.

So far, home buyers haven’t been that tempted by an average 30-year, fixed mortgage rate that hit 4.32% as of Thursday, according to Freddie Mac. Most of the action has been among existing homeowners looking to refinance their mortgages.

One reason buyers have possibly remained hesitant is that there is little reason to act if rates may fall even further, a classic deflationary mind-set.

That psychology may change. Bond yields have perked up after some mildly encouraging U.S. economic reports, notably Friday’s report that private-sector hiring continued its eighth consecutive month of gains in August. In response, prices for the benchmark 10-year Treasury note fell for a second straight week as investors regained a stomach for riskier assets. That sent the note’s yield, which moves inversely to its price, to about 2.7% on Friday from about 2.45% just days before.

That is a big move by Treasury-market standards. And its impact will be felt almost immediately in mortgage rates, which tend to move in lock-step. Mortgage rates have tumbled in recent months as fears of a “double-dip” recession have pushed Treasury yields down sharply.

An increase in mortgage rates now may worry Federal Reserve policy makers, who are trying to push rates lower in an effort to stimulate economic and housing activity. Some Fed watchers, including IHS Global Insight economist Brian Bethune, expect Fed policy makers will unveil more policy-easing measures at their next meeting on Sept. 21, since their target lending rate is already near zero. “They can’t afford to take the risk that home prices start to fall again,” says Mr. Bethune.

But the Fed is unlikely to be so hasty. And if the possibility of higher rates starts pushing more people to buy homes, that risk may be something the Fed can live with.

From Wall Street Journal

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Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.

Roseboom is part of a growing number of adults logging onto social networks such as Facebook and Twitter to stay connected, according to a study released recently by the Pew Research Center’s Internet and America Life Project.

In fact, for adults 50-64 years old, the use of social networking sites have jumped by 88% in the past year, the study found. For those 65 and older, it has doubled.

The younger generation remains the biggest users of Facebook and other sites. But the report shows that seniors currently make up the fastest-growing group.

“It’s surprising to see just how fast they are growing,” said Mary Madden, senior research specialist and author of Pew’s study.

Orlando, Fla., grandmother Rosie Chapman, who only revealed that she’s older than 65, joined Facebook more than a year ago. Like Roseboom, she prefers to go online to keep tabs on friends and loved ones, especially her three college-age grandchildren. Neither she nor Roseboom, however, generally share their daily activities.

Chapman was struck by some of the spiritual comments her grandson posts. “I never saw that side of him before,” she said with a smile. “I’m so proud of him.”

For the study, a survey was conducted of 695 adults who were 50-64 years old and 518 adults who were 65 and older.

The Pew Center points to several factors that contribute to why older adults are logging on to social networks now.

-It helps bridge the “generation gap.” The social networking sites bring people of all ages together in one space. Roseboom and Chapman are examples of that.

-More social network users are more likely to reconnect with people from their past. These reconnections can be powerful support when people are entering another phase of their life, such as retirement or a new career.

-Older adults are more likely to be living with chronic diseases, and those with diseases are more opt to seek support online.

More organizations, such as AARP, that cater to older adults are promoting social media networks.

Jeff Johnson, AARP manager of Florida operations, said the nonprofit organization uses Facebook and Twitter, as well as e-mail and traditional mail to reach members. “Over the past year, we have noticed more and more people discovering Facebook,” he said.

For the first time, AARP included a session last year at its annual convention that focused on social networking. It turned out to be a standing-room only event. It proved to be so successful that a session is scheduled at this year’s convention, which will be held in Orlando next month.

In May, AARP also taught its volunteer leaders for the first time how to use Facebook and Twitter to advocate for older adults.

“There is a growing understanding” on how it can be used, Johnson said.

John Evans Henderson, 62, knew he needed to embrace Facebook and Twitter as he embarked on a new career. He’s taking classes and focusing his new business on design building, especially homes, that are both “green and healthy.”

The Maitland, Fla., man has two Facebook accounts—one personal and a fan page for his business, Mr. House Guy. He spouts his opinions on his personal account, but opts to share environmental issues on his fan page. “I use it to get the word out about what I’m learning and what I can do for people,” he said.

Henderson isn’t surprised to hear more people his age are using social networking. He’s reconnected with several high school friends. It feels more like a natural progression for him, he said. “I think more people are seeing the way businesses are going,” he said, adding they have to adapt to the changing technology.

Seniors Now Computer Learning Center, which offers computer training at two Orange County, Fla., senior centers, doesn’t have a class dedicated to social networking, but it may develop one, said the group’s president Tom Springall.

Most older adults, he said, come to the organizations wanting to know two things: how to e-mail and how to get on the Web.

So far, e-mail is the most popular way older adults prefer to communicate online, he said. That, too, was reflected in Pew’s study.

Overall, 92% of those ages 50-64 and 89% of those 65 and older send and read e-mails. “While e-mail may be falling out of favor with today’s teenagers, older adults still rely on it heavily as an essential tool,” the report said.

Twitter, the micro-blogging site, tends to be lagging far behind Facebook. For example, Roseboom wasn’t sure what it was and Chapman didn’t find a need to use it. But it is slowly gaining ground.

In 2009, just 5% of users ages 50-64 had used Twitter or another status update service. That’s gone up to 11% now.

From RIS Media

Connect with Valerie…

Valerie Fitzgerald specializes in luxury residential real estate in Beverly Hills, Bel Air, Brentwood, Santa Monica and Malibu. Valerie has more than 20 years of real estate experience and is known for her solid reputation in the West Los Angeles brokerage community. She’s also the author of the book published by Simon and Schuster Heart and Sold: How to Survive and Build a Recession-Proof Business.

Search Luxury Homes in Los Angeles at Valerie Fitzgerald Real Estate Listings or contact Valerie Fitzgerald at 310-285-7515.