Adam Brett's Blog - All Things Real Estate in Fullerton and Beyond

The slowdown in our industry means that sellers and agents alike search for new ways to appeal to buyers. Home staging is one of those ways, and the number of home stagers is growing exponentially because of an increasing demand for their services. Five years ago, there were only a few hundred professionally trained stagers, according to their professional organization. Now, there are more than 20,000 in North America.

Although staging can be a costly venture - often thousands of dollars - there is interesting research that suggests it pays off enormously. A 2005 study performed by Coldwell Banker tracked 2,772 properties. It found that while the average home was on the market for 31 days, staged homes sold in just under 14 days. And while the average unstaged home sold for 1.6% above the asking price, staged homes went for 6.3% more.

What have you found? Is staging worth it?

Adam Brett
RE/MAX NOC
Fullerton,CA
714-496-8116
800-977-ADAM
www.RealtorAdam.com

Here are the numbers and you can decide for yourself.

These numbers cover these staistics from last year through this March.  As you can see this does not paint a pretty picture of the economy.  While some sectors are strong - the one we work and live in is being impacted greatly.

Be sure to make sound investments. 

Ordinarily, when the ownership of California real property changes, the property is reassessed at its current fair market value and the new owner pays property tax based on the reassessment. Proposition 60 created an exemption by providing that the taxpayer who is 55 years of age or older may transfer the Proposition 13 base year assessment of his/her principal residence to any replacement dwelling of equal or lesser value within the same county. If eligible, the homeowner will pay property tax on the replacement home based on the same assessment value of the former home. Proposition 90 enables such taxpayers, in certain circumstances, to transfer their base year value to a replacement dwelling in another county.

Please note that only certain counties have adopted Proposition 90. Former Governor Pete Wilson extended the Prop. 90 bill indefinitely, subject to the approval by each county in the program. It is IMPERATIVE that you verify with the individual county that they are still accepting Prop. 90 transfers.

- The seller of the original residence, or a spouse residing with the seller, must be at least 55 years of age, as of the date that the original property is transferred.

- The replacement property must be of equal or lesser "current market value" than the original.

- The base year value of the original property cannot be transferred to the replacement dwelling until the original property is sold.

- The replacement property must be purchased or newly constructed within two years (before or after) of the sale of the original property.

- The owner must file an application within three years following the purchase date or new construction completion date of the replacement property.

- This is a one-time only filing. Proposition 60/90 relief cannot be granted if the claimant, or spouse, was granted relief in the past.

- Proposition 60/90 relief includes, but is not limited to: single family residences, condominiums, units in planned unit developments, cooperative housing corporation units or lots, community apartment units, mobile homes subject to local real property tax, and owners' living premises which are a portion of a larger structure.

- The taxpayer is not eligible for the tax relief until they actually own AND occupy the replacement dwelling as their principle residence.

The County Assessor will require a copy of the tax bill from the other county and a copy of the applicant's birth certificate to be included with the application. Also include a copy of the grant deed for the new purchase and a copy of the closing statements for both the sale and the purchase. In most instances, if more than one owner of an original property is eligible for Proposition 60/90, they must choose among themselves which one will use the benefits.

To ensure a continuing supply of telephone numbers in our region, a new area code has been added to the area that is presently served by the 714 area code. Get ready to implement a new dialing procedure!

This area code overlay means that the new area code (657) will serve the same geographic region as 714, and includes the communities of Anaheim, Brea, Buena Park, Costa Mesa, Cypress, Fountain Valley, Fullerton, Garden Grove, Huntington Beach, La Habra, La Mirada, La Palma, Orange, Placentia, Santa Ana, Westminster, and Yorba Linda. An overlay DOES NOT require customers to change their existing area codes.

WHAT IS THE NEW DIALING PROCEDURE?
To complete calls from a landline phone, the new dialing procedure requires callers to dial 1 + Area Code + Telephone Number. All calls in the 714 area code that are currently dialed with seven digits will now need to be dialed using 10. To complete calls from a cellular phone within the 714 or 657 area codes, callers must likewise dial 1 + Area Code + Telephone Number.

WHEN DOES THE OVERLAY CHANGE TAKE PLACE?
Effective immediately, callers should begin dialing 1 + Area Code + Telephone Number whenever a call is placed. If callers forget and use the old dialing procedure of dialing just Telephone Number, the call will still be completed (until August 23, 2008).

Beginning August 23, 2008, callers must use the new dialing procedure for all calls. After this date, if callers do not use the new dialing procedure, their calls will not be completed, and a recording will instruct them to hang up and dial again.

Beginning September 23, 2008, new telephone lines or services in our area may be assigned numbers with the 657 area code.

WHAT WILL CALLERS NEED TO DO?
In addition to changing the dialing procedure, all services, automatic dialing equipment, or other types of equipment that are programmed with a seven-digit telephone number must be reprogrammed to use the new dialing procedure.

Some examples of devices affected are life safety systems, fax machines, Internet dial-up numbers, alarm and security systems, gates, speed-dial numbers, call forwarding settings, voicemail services, and similar functions.  Also, be sure to add the area code to saved contact numbers in your mobile/cellular phones and email clients (i.e. Outlook, Eudora, etc.).

If there are any questions regarding this area code overlay, please access http://www.cpuc.ca.gov/714areacode.

Adam Brett
RE/MAX NOC
Fullerton,CA
714-496-8116
800-977-ADAM
www.RealtorAdam.com

Congratulations are due to all the participants in the Fullerton School District's 2008 Spelling Bee. Held Wednesday, January 30th, in Fullerton's City Council Chamber, the competition included students in grades 4 through 8 and was televised on basic cable.  Each participant underwent a grueling qualifying process, winning at the class and then school level before advancing to the district competition. 

Depending on the grade level, the number of rounds in the bee varied from 5 to 13. The winning students were from Commonwealth, Hermosa, Fisler and Parks schools, and the winner from each grade level received a trophy. All students received a certificate of participation and a spelling bee pin. Winners from 6th, 7th, and 8th grade also went on to compete in the county competition, held on February 25th (the written round) and March 1st (the oral round). The county bee was won by an 8th grader from Coto de Caza.

Adam Brett
RE/MAX NOC
Fullerton,CA
714-496-8116
800-977-ADAM
www.RealtorAdam.com

The Muckenthaler Cultural Center begins its "2nds at the Muck" program this Sunday, March 9th. The "2nds" program runs through October 2008 and occurs the second Sunday of each month. Held in the Muck's 250-seat amphitheatre, each concert presents musical and cultural performances from a range of styles and eras. This Sunday's concert is a musical review by the Fullerton Civic Light Opera, and upcoming events will feature performances by the Culture Shock Dance Company, Linda Gentile, "America's Piano Princess", and Janet Klein and her Parlor Boys. Each concert promises a unique cultural experience and showcases local and international talent. 

Tickets prices and further information are available at http://www.themuck.org/.

Adam Brett
RE/MAX NOC
Fullerton,CA
714-496-8116
800-977-ADAM
www.RealtorAdam.com 

Top 10 Foreclosure Avoidance Tips

PRICE, PRICE, PRICE!  GET IT RIGHT OR WAIT… Some sellers desire to test the market.  Perhaps their motivation for selling is not the greatest or they simply have some time before their drop dead move date.  At any rate, price is generating a lot of buzz.  The Wall Street Journal had a great article, “PRICE FIXING: IN THIS MARKET, SELLING A HOME REQUIRES SAVVY.”  The article points out three distinct philosophies of price.  “Round numbers signal prestige, while precise numbers suggest a bargain.  Buyers anchor off the first digit, so $3,999 seems cheaper than $4,000.”  Finally, “if you cut your asking price, make it easy to calculate the discount.”

WHAT ARE THE ACTUAL NUMBERS… The total number of sales for January (the latest month available) is 1,286 and that is a 46% decline over January 2007.  There were 806 resale houses, 327 condos sold and 153 new homes.  Orange County had 4,276 Notices of Default (not foreclosures) for the fourth quarter of 2007, compared with 1,983 for the same time period 2006.  That is a 115.6% upswing.  Actual foreclosures have been running about 1 in 4 of total defaults.  Inland Empire and Los Angeles fared far worse with Defaults over 17,000 for each county respectively.

HOME AFFORDABILITY NUDGES UP IN ORANGE COUNTY… This was the OC Register headline on February 24^th.  Hopefully by the time you read this it will have nudged up even more.  What makes for a real estate market recovery is pent up demand, and that is reliant on several factors aligning; incomes rising (3.5% the last 2 years and projected about the same for this year), prices coming down (check), and interest rates (stimulus package anyone?)  The California Association of Realtors reported that 28% of Orange County residents can afford a started home as of fourth quarter 2007.  That’s up from the all time low of 13% we saw in 2006.

The news varied from a positive “negative headline” such as “O.C. homebuilder’s woes may reach bottom in ‘08” (OC Register, Lansner), to a downright positive headline such as “Ignore the Headlines!

Except this one.  Sure housing’s in a hole.  But there’s a potent case for buying now, whether it’s real estate or stocks.” (Time Magazine, Keadlec). 

What is the reason for the sudden optimism within the broader pessimism?  The answer to that question is a multitude of factors that this newsletter has been drumming into you for the past few months; factors such as low interest rates, selection, seller concessions, lack of competition and ultimately, more bang for your buck.  Both of the articles mentioned above really hinge on mortgage rates as key. 

Jeff Meyers, the founder of the Meyers Builder Advisors consultancy in Corona Del Mar notes the loan limit changes as bringing liquidity to the market.  He states, “…2008 will be the bottom year for builders in Orange County.”  The time magazine article says if you are, “emotionally ready to be a homeowner, you have good credit, plan to stay put for five years and have been waiting for the perfect entry point… It’s time to get serious--- before an inevitable rise in interest rates wipes out your advantage.” 

There may be some plausible arguments to waiting for prices to finish falling in other parts of the country where appreciation isn’t the foregone conclusion to this story.  But it’s tough to sit out in California. 

Housing prices have not fallen as fast as the doomsayers predicted.  It has been a correction, just as this newsletter stated over a year ago.  Will prices continue to come down?  Yes, there is probably some air left in the balloon.  But if you’re not careful rising interest rates will be buoying up that balloon that you want to see fall. 

Prices aren’t everything.  Leverage is.  (For copies of these articles, give me a call)

Adam Brett
RE/MAX NOC
Fullerton, CA 92835