Loan Shop Before Home Shop

Prospective home buyers typically begin their search for a home many months before they anticipate actually making a purchase. Their quest most often begins by using various online sites and occasionally going out on Sundays to stop by open houses. During this preliminary phase, many buyers prefer to not work with any particular real estate agent, and they begin educating themselves about the market in various areas of interest to them.

After several months, many of these searchers have become familiar with the housing market and may have agreed to work with an agent to help them in the process. The next step frequently involves seeing several homes by appointments with that agent and, by that time, they will usually have been advised to meet with a lender to get pre-approved for financing. Often the buyers are quite confident that financing will not be difficult at all, knowing their credit scores are high and that they have 20 percent of a down payment already in their bank and/or brokerage accounts.

Many agents accept this confident and unconcerned response from their clients about financing, and may be hesitant to do more than suggest a meeting with loan brokers. As a result, before any lender has actually been involved in pre-approving a loan, a purchase offer may be written for the home the client feels is an ideal match. Loan brokers can write a letter stating that the prospective buyer has been pre-approved for a loan. However, this pre-approval may amount to little more than what is more accurately termed a loan pre-qualification, based on what the buyers have stated to the lender about their income levels, monthly fixed costs, and on their credit scores.

There are several possible disadvantages of approaching the purchase process without actual pre-approval of a loan. If there are multiple offers on the identified property and one of them had already received full loan approval, they will be far more favorably viewed by the seller than will one that essentially has only gotten pre-qualified for a loan. Some sellers may feel uncomfortable taking their home off the market for a period of three to four weeks while waiting for the buyers to remove their loan contingency, and in today’s loan environment it can easily take that long for many lenders to complete the process.

Another drawback of not having a pre-approved loan before writing an offer is that there is often a sense of pressure as the loan contingency date gets closer during escrow. Perhaps the seller has by then accepted a backup offer from another party who already has financing arranged. The buyer may be put in the uncomfortable position of needing to risk losing the home if the loan has not been approved in time, or of taking a chance and removing the contingency before being fully assured that a loan is in place. Sometimes the process is unexpectedly delayed. Loan underwriters can ask for more details about some items on the potential borrower’s tax returns or other information in the loan application. In addition, many lenders will not schedule a property appraisal until after basic loan approval has been determined, and this in turn can easily delay the process by several days.

There is a huge negotiating benefit in having financing already approved before writing an offer. The buyer who can make an offer that has no loan contingency will obviously have much greater leverage. Most sellers will find it highly appealing to know that all contingencies might be removed in a couple of weeks, rather than perhaps taking up to nearly a month.

Thus, we highly recommend that any potential buyer take the time and make the necessary effort to get the loan process started well in advance. At the least, they can benefit by learning the various alternative types of loans currently available, with some understanding of the advantages some programs may have for them over others. They can be far better assured of succeeding in purchasing their ideal home when it is identified by doing this shopping well ahead of time. We are glad to provide several excellent and proven-reliable sources of loans to anyone who would like to get started in the process.

As Published in the Santa Monica Mirror

Pacific Palisades Market Update- June 2011

Special to the Palisadian Post

As of May 31^st, there were 126 single-family Palisades residences listed in the Multiple Listing Service (M.L.S.), which is nine percent lower than this time last year. So far this year 91 Palisades homes have sold (which is four percent lower than this time last year), and there are now 48 homes in escrow in the Palisades.

Median sale prices are currently $1,715,000, which is off 10% from the same period last year. The average sale price per square foot has dropped by seven percent as compared with the same period in 2010, and is now at $644 per square foot.

The lowest-priced available home is a 2-bedroom, 2-bath on Swarthmore at $859,000. The highest-priced property is on Evans Road. This 7-bedroom, 7-bath house is listed at $23,500,000.

The lowest sale price so far this year was a 2-bedroom, 2-bath on Livorno, which sold for $825,000, which was over the asking price of $750,000. The highest sale so far this year was a 3-bedroom, 5-bath on Alta Mura in the Riviera, which sold for $6,350,000.

There are 39 Palisades condominiums/townhouses on the market. They range from 1-bedroom, 1-bath in the Edgewater Towers on Sunset Blvd. offered at $374,900, to a 3-bedroom, 2.5-bath townhome on Haverford for $1,795,000. Seven condos are currently in escrow. There have been 16 condo sales so far this year, ranging from $410,000 for a 2-bedroom, 2-bath on Tramonto Drive, to $1,300,000 for a 3-bedroom, 3.5-bath on Palisades Drive. The median condo sales price is $700,000, which is up five percent over the same period last year.

There are currently 24 pieces of raw land available, ranging from a steep slope with 17,000 sq. ft. on PCH, being offered at $90,000 to $19,900,000 for over an acre of sloped land on Corona Del Mar in the Huntington.

There are currently 56 leases in the Palisades. They range from a 1-bedroom, 1-bath apartment on Sunset asking $2,000 per month, to a 7-bedroom, 9-bath home on Rivas Canyon asking $70,000 per month. So far this year, 99 Palisades homes have been leased. The highest lease was a 4-bedroom, 4-bath on Alta Mura for $16,500 per month, and the lowest was $2,595 per month for a 2-bedroom, 2-bath on Sunset.

Inspirational Thought

The gem cannot be polished without friction, nor man perfected without trials.

- Chinese Proverb

A Recipe for Escrow Success

Since my team has a relatively higher rate of successful escrow closings, 90% versus 75% local average, I have been asked what attributes have been found most helpful to this success. In thinking this through, I have identified several key ingredients that are most helpful. These need to be used in combination by both sellers and buyers in order for escrows to be successful.

• Good Faith – it was observed by a manager I worked with for many years that in his experience, 95% of what we do in residential real estate comes down to the good faith of both sides. Without that ingredient, no amount of legalese or paperwork can help. With good faith on both sides, the paperwork can seem almost incidental.
• Honesty – if both parties base their actions on what is known to be true, the entire process has a vastly better chance of success. If a seller doesn’t disclose everything of significance, or a buyer fails to mention that they really do need to sell their current home, major hurdles lie ahead, making the process much more challenging.
• Fair Mindedness – if each side makes every effort to be fair in how they deal with the other, it sets the tone for a smoother process.
• Reasonableness – only to the degree that each party keeps a practical and realistic perspective, based on reason, can the process be worked through more easily.
• Flexibility – an attitude of “give and take”, and a willingness to “go with the flow” when necessary is the spirit required in order to accommodate differences that inevitably come up.
• Patience – only by taking a longer view can both parties handle the immediate challenges that show up.
• Humor – buying or selling a home is among the most emotion-filled activities that people engage in. A lighter touch and good-humored attitude helps maintain a much clearer perspective of what really is important. Both parties are much more likely to arrive at the finish line with good feelings intact.

Like any recipe people may use in putting together a meal, the key ingredients need to be used in balance and kept active when needed and to the extent necessary. One thing is for sure: if both parties utilize all of these attributes, the probability of a successful outcome is vastly greater than it would be if some of them are missing.

Published in the Palisadian Post

New Listing: Beautiful Sea Ridge- 3 Bedroom Designer Unit

Designer unit with high-quality details in gated community just two blocks North of Sunset and close to shops, restaurants and beach. Open living and dining with high ceilings and custom tile/wood floors. Vibrant kitchen with breakfast area that opens to balcony. Guest bedroom/office on upper level, plus full bath. Lower level has wonderful master suite with built-in office area and two walk-in closets, plus additional spacious bedroom suite. Beautiful mountain views from most rooms and deck. Two-car garage plus plenty of nearby visitor parking. Close proximity to pool area. Move-in condition.

730 Palisades Drive, Pacific Palisades, CA 90272
Offered at $1,165,000

For pictures and information of this and other wonderful properties please go to Michael Edlen's Featured Homes web page.

New Listing: Beautiful, Private Home in North Riviera

Set on one of the best street in North Riviera. Gated privacy surrounded by lush and romantic landscaping, this beautiful Traditional is ideal for entertaining with fabulous indoor/outdoor flow. Six large bedrooms, 5.5 baths, plus upstairs bonus/playroom. Large-scale living and formal dining rooms off updated kitchen, breakfast and family room. Separate guesthouse with fireplace and bath. Wonderful feeling of warmth and comfort in a lovely setting. Gorgeous yard, huge pool, and covered veranda. Front yard with basketball hoop and kids playhouse. Several fruit trees around the property

13656 D'Este Drive, Pacific Palisades, CA 90272
Offered at $4,500,000

For pictures and information of this and other wonderful properties please go to Michael Edlen's Featured Homes web page.

New Listing: Contemporary/Traditional with Ocean and Mountain Views

Charming, bright and airy Contemporary-Traditional set at top of cul-de-sac with sweeping ocean and mountain views. Living room with vaulted ceiling, stone fireplace and french doors to yard. Dining off , eat-in kitchen and large family room - also opening to grass yard with private lower-level pergola/patio. Three bedroom suites up, one down. Master has beautifully redone bath with walk-in closet, fireplace and sundeck. Wood floors throughout

16872 Charmel Lane, Pacific Palisades, CA 90272
Offered at $2,100,000

For pictures and information of this and other wonderful properties please go to Michael Edlen's Featured Homes web page.

House Fire Prevention Tips

Every year home electrical problems cause more than 28,000 house fires and massive property damage. Faulty or fixed wiring or improper use of electrical cords and other electrical items cause most home fires. Here are some helpful tips for electrical safety.

• Pay Attention: Flickering lights, buzzing noises, and faceplates that are warm to the touch are all signs that a circuit may be overloaded or wiring may be wearing thin. Each one of those signs is cause for immediate attention from a licensed professional electrician.

• Listen to Your Breaker: If you are continually tripping a switch and having to reset your breaker box, your house is trying to tell you something. There may be a fixture with faulty wiring or too high an electrical load on the breaker. Again, seek professional help.

• Review and Replace: Frayed electrical cords, wobbly ceiling fans, and loose faceplates are more than mere annoyances. You should routinely inspect your home and replace or repair items in need of attention.

• Safety First: Even the best preparation and newest equipment is not a guaranteed protection against fire. Working smoke detectors on all levels of your home is an absolute must. Make sure you have a working fire extinguisher and you know the proper way to use it.

Provided by the Electrical Safety Foundation International (ESFI), www.esfi.org

New Listing: Traditional-Contemporary Two Blocks from the Bluffs

FIRST SHOWINGS TUES, 5/17 11AM-2PM. Over 3,700 sq. ft. Traditional-Contemporary with a wonderful floorpan and indoor/outdoor flow. Large living room with vaulted beam ceiling and fireplace opens to dining and nicely done kitchen. Family room, plus office and guest suite on main level. Upstairs includes bright master suite with fireplace, balcony, walk-in closet. Three additional custom-painted bedrooms, 2 baths and bonus/play room. Vaulted ceilings throughout. Dining wall opens to huge, private wood deck and lower patio with hot tub. Just two blocks to ocean bluffs. Absolutely move-in condition. Tract 9300.

531 Almar Avenue, Pacific Palisades, CA
Offered at $2,000,000 USD

New Listing: Award-Winning Architect Designed Masterpiece

FIRST SHOWINGS TUES, 5/17, 11AM-2PM. Inspired by pioneering architect, Irving Gill, and designed by award-winning architect, Hagy Belzberg, this gorgeous, light-filled home with ideal floorplan that connects from the front door through to the back yard. Beautifully landscaped with front rose garden and inviting entry area. Wide open living and dining off recently updated kitchen. Family room off guest suite - both opening to wood deck. Dramatic lines and perfectly-placed windows combine with soaring ceiling and wood floors. Upstairs includes three bedrooms, two baths and a serene landing area with balcony. Extremely romantic yard and large patio area make this a great home for entertaining. Garage/studio/gym. Just blocks to Village shops, restaurants, farmer's market, etc. Tract 9300.

836 Hartzell Street, Pacific Palisades, CA 90272
Offered at $1,745,000

For pictures and information of this and other wonderful properties please go to Michael Edlen's Featured Homes web page.