Palos Verdes Real Estate Blog

There is serious discussion between Congressional leaders and the White House about increasing the loan limits from $417,000 to $625,000 (perhaps as high as $725,000 in high-cost areas) for guaranteed/insured Fannie Mae and Freddie Mac loans. From LATimes.com – “And in a provision crucial to high-housing-cost states such as California, there would be a significant one-year increase in the size of mortgages that could be backed by the government. That would make it far easier for homeowners to refinance into more affordable mortgages.”

Single family homes sales on the Palos Verdes Peninsula may not directly be affected. In 2007, the average price (reported monthly) for a single family home that sold on the Peninsula fluctuated between $1,513,000 and $2,355,000. The actual high for 2007 was $12,900,000 and the low was $807,500.

This change may favorably affect townhomes and condominium sales here on the Palos Verdes Peninsula as the average price (reported monthly) for a condo/townhome in 2007 fluctuated between $516,000 and $688,000. The actual high for 2007 was $1,050,000 and the low was $235,000.

Indirectly, increasing conforming loan limits will affect the Palos Verdes Peninsula because of the “domino effect”. In other words, buyer’s from other areas wishing to purchase in Palos Verdes will find buyers for their homes who will be taking advantage of these higher Fannie Mae/Freddie Mac guaranteed loan limits.

This is great news for the housing industry.

The Valmonte neighborhood is located in Palos Verdes Estates. The best thing about this neighborhood is that it is a family neighborhood. There are usually groups of children playing outdoors on any given day. The topography is relatively flat which is great for walking, riding bikes, playing ball, etc. It is a very friendly area with lots of people taking walks and stopping to chat.

Houses were built individually by owners who purchased lots – this is not a tract neighborhood. The first house was built over 70 years ago. There are mixed style homes from Ranch, Spanish, Contemporary, Tuscan, Craftsman, etc. all approved by the Palos Verdes Homeowner’s Association. Housing prices in 2007 ranged from $912,500 to $2,685,000.

The weather is temperate; it’s been said Valmonte is in a “banana belt” – not too much fog, wind or heat – it’s perfect. Valmonte is located on the north side of the Palos Verdes Peninsula so it is closer to beaches, freeways and shopping “off the hill”. There are no sidewalks, street lights or signals. At night you can see the stars.

Yesterday, rumors were swirling that Bank of America may be buying the troubled Countrywide. This is good news for the financial markets and ultimately for our local real estate. This piece of news will add some calm to the aura of uncertainty surrounding Countrywide and other lenders who have been impacted by the subprime mess.

With the calming of the financial sector and the increased confidence it spawns, the perception of “everything is okay now” will encourage buyers to come back into the real estate market. It is such a matter of perception and the press has been very negative last year which scared many buyers and sidelined them with a “wait and see” attitude.

In addition, Federal Reserve Chairman Bernanke hinted at another rate cut. Marion Duffy, of ERA Orange County, says “that this announcement will have a very positive effect on our market.”

My neighbor passed away in her home just two weeks shy of her 102nd birthday. When I think back on the 33 years we “shared a fence”, I cannot remember her ever being stressed about anything. The other neighbors have also commented on this phenomenon. We never saw her angry, upset, tense or worried. She loved everybody. We think this is the secret to her longevity. She was such an inspiration.

At her memorial service, I heard how in response to some “bad” news, she said, “Oh well”. The gentleman giving the eulogy had her mannerisms down perfectly – the cocking of the head to the side, the shrug of the shoulders, the raising of the eyebrows and the words, “Oh well”. I remembered how many times I had actually seen her do this.

“Oh well” is my mantra for this new year. This was put to the test yesterday when an “issue” came up for a client. Instead of jumping into fix mode complete with my adrenalin soaring, I said “Oh well, let me make some calls”. The problem was taken care of without any stress on my part and the client was very grateful. I love it.

In Palos Verdes Estates, we are blessed with the “Art Jury” (Homeowner’s Association) which is to approve any exterior changes to your home. This is everything from the color of your home to shutters, doors, driveways, rain gutters, fencing — you get the picture. The good news is that it keeps the neighborhood looking nice and not “too far out”. The challenge can be when you sell your home.

A disclosure regarding the “Art Jury” must be given to buyers. Sellers are smart to request a “Certificate of Completion and Compliance” (and pay $150 fee) prior to listing their property. The Palos Verdes Homeowner’s Association will come out and physically inspect the property with rolls of past approved plans in hand. Anything not formally approved by the City – and in addition to the above, I have seen items such as patios, gates, awnings, sheds, windows, playhouse, skylight, etc. – will appear in your letter as non-conforming items.

The City takes photos while at the property and if you submit a formal request (and fees) to the City, they will let you know what is approved and not approved. Most buyers I have dealt with accept these non-conforming items and understand that the City may ask them to come into compliance when the new buyer later goes to the City for future permits/approval. It’s all about disclosure – buyers and sellers both appreciate all known facts being presented so they can make an informed decision.