Chris – Page 15 – OC Neighborhoods

Energy Savings Tips for Californians

Use of energy in Southern California can be higher for those who don’t live on the coast and don’t get that marine breeze. The end result is that you’ll spend any more money on air conditioning and heating bills. Additionally, you aren’t being environmentally friendly. Decreasing your energy consumption helps you and the Golden state as a whole. So, how can you do your part?

Air conditioning

Energy consumed in California is mostly as a result of air conditioning usage. This makes sense in a semi-arid climate where brush fires and seasonally dry weather proliferate with the Santa Ana winds. An efficient method to keep your home cool is by using a/c, but if possible, you can use other ways to cool off your home in less costly ways by:

Closing your blinds
Close doors in rooms you don’t use often
Fill up a bowl with ice and place a fan in front of it
Install and use ceiling fans (set to operate counter-clockwise)
Switch to CFLs lighting because incandescent lights produce heat
Open the windows at night when it is cooler
Plant trees around your home for shade
Cook outside the house (prevents heat build-up in your home)

Appliances

Did you know that appliances are the second-largest energy hog in California. Prepare and cook your meals on the grill as opposed to the stove in an effort to not heat up your home. Some households have two refrigerators or freezers for extended family or roommates. Figure out if you can do away with one of them. Without a doubt, buying food in bulk and storing in the freezer can save money, but the savings are a wash if you are paying to keep the bulk foods cool. Instead of the dryer, try drying some or all of your clothes on the line.

Electronics and Lights

Turn off electronics and lighting when they are not in use. Utilize a power strip to lessen your energy drain from equipment that needs to be plugged in, even when it isn’t on. If the appliance isn’t Energy Star see if you can keep it unplugged.

Saving energy consumption will be good for your checking account and you’ll know that you are doing your part to help the environment. After all who wants to experience rolling blackouts. Not many of us.

Home Appraisal Was Lower Than Purchase Price!

In Some Cases Appraisers Make Mistakes

The lender wants to know the home fist before fully approving your mortgage loan.

Essentially, the value of your home will establish what loan programs you qualify for and, what mortgage rate is available to you.

Lenders depend upon licensed home appraisers to confirm a home’s “certified” value.

Sometimes, an appraiser determines the property’s value to be below what’s required for a specific loan program.

When your appraisal comes in under the estimated value, as a buyer or refinancing homeowner, the options you have are a few.

Appeal the Home Appraisal

Although appraisers use standard procedures and formulas to determine the home’s value, an appraisal is still the opinion of the appraiser, which means it is subjective.

An appeal may be warranted, if you’re able to provide documentation to support to an argument such as:

When the appraiser uses older “comparable properties”

The largest impact on a home’s appraised value is the recent sale prices of similar homes in the immediate neighborhood, preferably on the same street.

If the appraiser is using a nearby home which has less rooms (bedroom and bathrooms), and significantly less square footage, when another more comparable property is available, it is unreasonable.

An experienced Orange County real estate agent can help you locate more recent comparable sales.

When the appraiser leaves out home improvements

Appraisers work consists of investigating your home utilizing public records data.

This information public record has your home’s most recent sale price, the number of bedrooms and bathrooms, and a couple of other stats which an appraiser can use to come up with a range of estimated values on your home.

This method is known as an automated valuation model (AVM). The AVM is an “appraisal” without actually physically viewing your home; the on-site inspection will then be used to confirm what the appraiser has already found through public records.

If public record information is lacking some pertinent information, your home’s appraisal may leave out some major improvements made to the home.

To illustrate, if you’re taken out the old dust & bacteria filled carpeting and replaced it with Brazilian hardwood or ceramic tile floors, your appraiser wouldn’t not know that and would likely be missed.

A Common Situation is When the Appraiser Doesn’t Know the Local Area

Occasionally, a home is quite a distance away from the appraiser’s normal area, so an appraiser may drive 100 miles or more to conduct a appraisal.

When appraisers are unfamiliar with the neighborhood, the data from public record information tends to come into play more in determining value than the subject property’s features.

If you think that the appraiser doesn’t thoroughly know the neighborhood, this can be a good reason for an appeal.

When the Appraiser Commits a Mistake

Humans make mistakes, and appraisers are human. We all make an honest mistake. For that reason, it’s a good idea to look at your home appraisal and determine if there are any errors.

The errors on the report, if they occur, are likely to be wrong square footage and lot size; incorrect number of bedrooms and bathrooms; and, no mention of fireplaces, patios, or balconies.

Be prepared to show evidence of the mistake on the appeal.

If the appraiser or lender won’t fix the obvious mistake, then you take your business elsewhere where they will fix problems.

Starting your loan over may postpone the closing, but without a good appraisal, the closing may not ever happen.

Home Buying Checklist

When making a home purchase, a lot of excitement and planning can make you neglect significant issues after you move-in. It’s highly recommended that you error on being overly cautious than not. For most people, purchasing a home is the biggest financial choice they will make in their life.

Home Buying Points to Consider:

Location – Always a huge factor. Do you like the neighborhood and its surroundings? Do you think the home will sell for more than purchased it for ? Is the area in need of gentrification or is it currently desirable? Can it maintain its value ?
Neighbors – Are the neighbors friendly? Are they owners or renters? Is their landscaping nice or needs improvement? Bad neighbors can impact your property value, the wrong way. Proximity to neighbors; Some homes offer more distance from next door to another. Check the view from every window and walk the property to be sure.
Amenities – How far are things to do? Are there parks within walking distance or miles away? Large planned communities tend to have local shopping and parks within a couple of miles.
Schools – Are there good schools nearby? If so, it is good sign the neighborhood will retain its value or appreciate.
Utility Bills – Request a copy of the seller’s utility bill for the summer and winter from their agent or the seller. This will help you determine if it’s on par or much higher than you thought.
House positioning on lot – How much natural light a house gets is influenced by its lot position. This can affect the heating and cooling bills. A home that is south-facing usually receives the most natural light. However, a home that is north-oriented may be equally bright if the primary living space is in the home’s rear section and there are plenty of windows throughout. A north-facing home in a hot climate could be more effective if you want to keep your house cooler.
Foundation – In California, you cannot overlook this potential problem. Check for cracks in the walls as it can be a great indicator there are possible settling concerns. Floor cracks should also be carefully examined.
Roads – Is the home you are considering purchasing on a busy road? Roads that are very may require the city to expand it . You need to also assess if the roads are in good shape.
Street parking – Homes in the suburbs or rural areas usually don’t have street parking concerns, but some cities and planned communities in Orange County do have unusual rules, permits, and regulations regarding it. Some places will not allow you to park in front of our own house at night.
Inspection – Many older homes have something wrong during the inspection with cooling, electrical, heating, plumbing, roofing, etc. Even newer homes may not pass tests for Radon, mold, etc. Get a licensed home inspector to check and give you a quote for the cost of the repair.
Size of rooms. Make sure during your walk-through that the rooms are not too big or too small. Visualize your own furniture in the rooms or just measure it if you are able.
Days on market – How long has the home been available for sale and why so long? In most cases, there may not be anything wrong with a home because it has been for sale longer than others.

Don’t Make Mistakes On Your Offer to Buy a Property

Since 2012, there’s been a consistent rise in home prices which is making new options for a lot of baby boomers and others nearing retirement.

According to CoreLogic statistics, the median Orange County home price has increased $267,000 since four years ago. Some home buyers see that as a signal to get themselves into a home. They’ll need to work with a good real estate agent to locate a suitable property and put in a purchase offer.

Agents who are representing buyers recommend that your offer should be based on the most recent sales prices of comparable properties in the area. This encompasses comparing all features of the properties to your prospective property.

Some examples of comparable features are: square feet, number of bedrooms and bathrooms, year built, location, lot size, parking, pool, etc.

The amount that you offer for purchase of a property should not be based on a percentage off of the List price.

Occasionally, after analyzing recent sales of comparable properties, you will discover that the list price is actually in line with current market values of similar properties that sold in the last 60-90 days or is even priced under current home values.

With this in mind, you shouldn’t expect substantial change from the list price. For that matter, if the property has appealing features, it’s not unusual for such properties to generate multiple offers or sell above the asking price, especially when inventory is low.

It is not a mistake to make an offer at the list price or above if the purchase price is at market value. The issue is many buyers have it ingrained that they’re not getting a deal. Some sellers understand this and simply list their home at a higher price to allow room for the buyer to negotiate.

Your offer should not be predicated on modifications you would like to make. Make an offer based on the property’s condition and current market value. If the modifications, you’d like to make cost $100,000, you should not simply subtract $100,000.

Offer Mistakes

Offers that are unrealistic to the seller, like lowball offers many times do not even get a response from the seller. Some sellers are outraged by such an offer and it indicates you are not a serious buyer.

Do not base your offer on the home’s tax assessed value. The tax assessed value is commonly less than current market value.

Do not base your offer on how much the current owner paid for the property. The current market value is what you need to pay attention to, not their profit. They may have bought it 25 years ago which means they’ve probably experienced equity appreciation of more than 300%.

Do not base your offer on the property’s value when home prices were at their peak. The price it would have sold for in 2005 is not important today, stay focused on how much the property’s current value is now.

Currently, Orange County is in a market when inventory has been reduced, so, generally, there’s adequate data to review to figure what the current market value is. In certain neighborhoods, especially those that are close to the beach, property values are stable and experiencing appreciation due to sales activity, reduced inventory, and high demand, so worries about future price declines based on your offer are less important.

A high percentage of today’s buyers are making “All Cash” purchase offers for homes, so the anxiety about a repeat housing crash due to mortgage defaults is a huge mistake and should not affect decisions about offering close to list price, at list price, or above.

Anytime we work with home buyers, we start the search by providing full data about neighborhood property values they’re considering so that practical expectations are known, as well as an accurate, informed understanding of the market.

Prices Return to Highs: It’s Still a Good Time to Buy in OC

With mortgage rates at record-lows, a healthy pool of buyers and an inventory shortage of homes, Orange County home and condo prices have hit the June 2007 price levels which was around the housing boom peak.

In April, Corelogic Data said the median price of a home touched the $645,000 level, helping Orange County become the first county in Southern California to return to their prices prior to the recession.

That may bring back bubble fears, however, today’s housing market is very different from the housing situation of 2007. One big difference now are the monthly home payments are lower by $406 than in June 2007.

Another is the availability of financing such as 100% financing with an option arm or stated income product for someone with credit scores below 600 was ridiculous back then.

A third factor, is one has to factor in some inflation. This means, a home valued at $645,000 in 2007 would equal a home of $744,000 if calculated in dollars today.

One similarity back in the peak years was you had happy sellers and some discouraged buyers. There continues to be concern over the shortage of reasonably priced homes listed for sale.

Because interest rates are very low, a lot of people are trying to purchase a home. Even a home for sale at $600,000 will receive around 7-10 offers in a matter of days.

So, realtors say and know it’s very competitive for the buyers and advise them to stay the course. Some home buyers get so anxious that they are paying over the asking price just to finish the process.

With climbing home prices combined with a low inventory of homes for sale, buyers understandably get frustrated.

However, Orange County home sales have fallen year over year in the past 14 months possibly resulting from buyers who don’t qualify due to income and credit.

At the same time, Orange County’s growth in employment, larger households, and low interest rates are keeping the need for housing ongoing. As a result, entry-level home prices range from $500,000 to $750,000 which keeps a lot of first-time home buyers out of the single family market. They end up going for the alternative which is a condo or townhouse when they are squeezed out of the home market.

In comparison ot Orange County, the prices of home in Los Angeles and San Diego counties is still 5.5 percent less their peak prices from 2007. Further inland it is more noticeable with Riverside County home prices 23.6 percent under their peak level, and San Bernardino County is approximately 28.9 percent under its peak price point.

Although demand is high in Orange County, significant price appreciation is not expected year over year from the indicators mentioned above. Many economists are in agreement that any equity gains will be modest in the upcoming years.