Real Estate News Review

Truck-size Pumpkins Would be Necessary Today

admin — Thu, 07 Aug 2008 23:08:10 +0000

In the post The tomato that paid the mortgage, we read about M.C. Byles, a 1930’s mechanic who bred a 2.5 pound tomato. It was in demand, and he was selling the plants for $1 each.

With his income, he was able to pay off his $6000 home mortgage in six years. For that reason, you can still order these tomato plants by their name, Mortgage Lifter. I think you could get a Coke in the ’30s for a nickel or so, and now you can still buy them in some markets for fifty cents. Using this 10-to-1 inflation factor, these tomatoes would sell for about $10 each today, or $4 per pound.

However, if you have a very normal and average mortgage of $250,000 today, we are looking at a LOT of tomatoes. Actually, we might have to move up to 40 pound pumpkins. At $160 each, we could pay off the mortgage with 1563 pumpkins if we sold them all in one day. However, if it took six years, as it did Mr. Byles, we have the interest to figure in. At 7%, we’d have to sell approximately 630 more pumpkins to get the entire mortgage paid off in six years.

So, it’s 2193 very large pumpkins, or more than 35,000 of those tomatoes! Isn’t it amazing how we can take almost anything and get a real estate story? I’m going to eat a beefsteak tomato and think about my mortgage.

Workforce — or, make that ‘Nurseforce’ — housing is spreading in Southern California

admin — Thu, 07 Aug 2008 21:08:10 +0000

Remember those nurses, teachers and firefighters profiled repeatedly during the real estate run-up as zillion-mile commuters who couldn’t afford to live near their jobs in Los Angeles and Orange counties?

Well, some have found spacious homes they can afford, even in today’s challenging market — near their jobs in Sylmar, Inglewood, Pomona, Azusa, Agoura Hills, Long Beach and Anaheim.

And now, Arleta.

A joint venture of Stephen Ross, CEO of Encino-based Montage Development Inc., and CityView, the workforce-housing development company of former Housing and Urban Development Secretary Henry Cisneros, Laurel Village is adding 69 four- and five-bedroom single-family detached condos for $399,000 and $409,000, respectively, to the north San Fernando Valley, close to a number of hospitals and schools.

The complex is gated and has a pool and play area.

Among the occupants of the 47 completed homes either sold or in escrow, 15 are medical workers (including nine nurses) and five are teachers. Forty-seven formerly were renters, 13 already owned a home (mostly nearby) and two lived with their parents until they could afford the condo.

About half of the owners are 30 to 49 years old.

Included in every home are granite counter-tops, window coverings, a patio, landscaping and appliances including a washer and dryer. “We don’t want the buyers — many of whom were renters — to have to pay for what we consider essentials after they move in,” Ross said.

– Diane Wedner

Photo: Brad Wilder

Questions? Comments? Email diane.wedner@latimes.com

Madonna, the mini property maven

admin — Thu, 07 Aug 2008 19:08:30 +0000

Rumours that Madonna’s marriage is on the rocks have sparked conjecture on the
division of her property portfolio - gossip that will not be go away despite
talk of a reconciliation. This may be because, in a case of life imitating
song titles, Madonna has secured her Material Girl reputation by making some
unexpectedly good long-term gambles on the London market.

Jobs, store sales soft but homes data brighter (Reuters)

admin — Thu, 07 Aug 2008 18:08:30 +0000

The higher-than-expected June signings of home sale
contracts offered some hope the housing market may be
stabilizing. But the jobless claims and Wal-Mart’s missing July
sales forecasts boosted concerns about consumer spending and
the corporate profit outlook, sending Wall Street stocks lower
and U.S. government bond prices higher.

Dont's of Real Estate Leverage

admin — Thu, 07 Aug 2008 16:08:10 +0000

Used properly, real estate leverage can be an effective tool for real estate investors to increase their return on investment. The key is to avoid making decisions without proper consideration of the areas of risk in leverage.

The hits keep coming, or Thursday morning’s mini-round-up

admin — Thu, 07 Aug 2008 14:08:11 +0000

– 2007 wasn’t a very good year for mortgages either: The delinquency rate of very young mortgages is rising, the WSJ reports. Home loans made in early 2007 are turning sour at a pace that surpasses the 2006 vintage.

Barclays profits plunge on huge credit-related losses (AFP)

admin — Thu, 07 Aug 2008 12:08:20 +0000

Barclays, the third-biggest British bank by market value, said in its results statement that profit after tax had tumbled to 1.72 billion pounds (2.17 billion euros, 3.35 billion dollars) in the first half compared with the figure for the January-June period in 2007.

Dont's of Real Estate Leverage

admin — Thu, 07 Aug 2008 10:08:10 +0000

Which houses are most likely to sell at the biggest discounts from their list prices ?

admin — Thu, 07 Aug 2008 08:08:20 +0000

The folks at online brokerage Redfin looked at more than 2,900 house sales in Los Angeles County from April through June, and identified traits of homes that sold for the largest discount from the final asking price.
Prices came down most when:
1) the home was listed for more than 90 days
2) was a fixer-upper
3) were more likely to have been owned by the seller for 20 years or more or…
4) were owned for less than five years.

Redfin also found that sellers who have already cut their list prices often agree to more reductions to get a sale.
Most of the above are fairly obvious. Sellers who’ve owned a home for more than 20 years will likely make a solid profit even if they come a long way down from their original list price. Those who’ve had the home less than five years may be in mortgage trouble or flippers who need to sell quickly.
But one conclusion may surprise some: Redfin finds buyers won’t have much luck trying to low-ball foreclosed homes sold by banks. That’s because lenders these days are already offering foreclosed properties at deep discounts.
The entire study, which includes data for King County, Washington and Fairfax County, Virginia, can be seen at

Conn. sues Countrywide over lending practices (AP)

admin — Thu, 07 Aug 2008 07:08:40 +0000

A federal grand jury has been investigating Countrywide, New Century Financial Corp. and IndyMac Bancorp Inc. a sign that prosecutors are looking into whether fraud and other crimes might have contributed to the mortgage crisis that led to the demise of all three California-based lenders.