Flipper Crowdfunding

crowd

Remember last time? When you don’t have mortgage underwriters being strict with the money, you are entering bubble territory:

http://www.cnbc.com/id/102537364

Chicago-based Ben Walhood used to sell brain surgery equipment; on the side, he flipped a few houses.

“When I had the W2 and a good income, getting a mortgage was relatively straightforward,” he said.

But when the flipping profits grew, Walhood, 33, decided to go into it full time. Without the sales job, though, he had no W2, and that’s when the money dried up.  “At that point it was essentially impossible to get funding from the big banks,” he said.

Walhood turned to San-Francisco-based RealtyShares, one of a growing breed of crowdfunding platforms. Essentially, it is an online marketplace for real estate investing, where individual investors can open a free account and access investments in properties across the country. They need a minimum of $5,000 to invest and must be accredited, which includes either an annual income exceeding $200,000 or a net worth of over $1 million.

Walhood would get his property purchases funded by this “crowd” of investors, who would lend him the money. As with a mortgage, he pays interest on the loan, and the investors get about a 9 percent return. Once each property is sold, the loan and the investors are paid off.

“This gap has been left by banks that now crowdfunding platforms, like RealtyShares, are able to fill,” said Nav Athwal, CEO of RealtyShares. “They are able to provide quicker, more efficient capital that helps meet the needs of these investors who are looking for speed of execution and the ability to be flexible with their terms as well as with the underwriting standards. Banks just aren’t meeting that need.”

http://www.cnbc.com/id/102537364

Zillow vs. Realtor.com

Have you seen or heard the realtor.com ads?

I heard this 30-second ad on sports-talk radio and thought it was standard fare:

http://www.realtor.org/audio/consumer-advertising-campaign-real-people-2015-radio-ad

Then I saw this ad today on the C.A.R. website:

move ad

This claim is from the National Association of REALTORS®, Profile of Home Buyers & Sellers, Addendum Questions, 2014, so I guess they can say it’s legit.

But isn’t it too early for realtor.com to be saying they are better than Zillow at anything? It could be a regional thing, but I never hear any consumers talking about using realtor.com, so to me it all sounds far-fetched.

Meanwhile, Zillow is crushing it with their TV ads, and probably pulling ahead:

Realtor.com needs to be producing better advertising than Zillow if they think they are going to catch up.

LPGA in Carlsbad

aviara

Check out the Kia Classic this week, and see Lydia Ko! The pro-am is tomorrow, and the tournament runs Thursday-Sunday.

The Kia Classic is next on the LPGA tournament schedule.  Anna Nordqvist will defend her 2014 championship on the Park Hyatt Aviara Golf Club in Carlsbad, California against an exceptionally strong field of challengers.

Designed by Arnold Palmer, the Aviara is ranked among the top 100 resort golf courses in the country by Golf Digest.  The par-72 7,007 yard coastal California track is a favorite among Tour players.  The course is a visual delight, overlooking the Batiquitos Lagoon nature preserve and sculpted around rolling hillsides and with plenty of bunker and water challenges the track will also provide tests of players’ course management and shot placement skills.

LKLydia Ko is starting her 8th week at the top of the Rolex Rankings in a record-breaking ascent that has left all of us — her competitors, commentators and golf fans alike — astonished and in awe of her athletic talent and mental poise.  The 17-year old is coming into the Kia Classic with two 2015 victories to her credit.  There’s no doubt in my mind that there will be more before the season ends next November.

The Kia Classic is the final Tour event before the season’s first Major, the ANA Inspiration, and will be a dress rehearsal for a fierce battle that’s certain to unfold in the desert.  Ko will play her steady game of precision and control as will 2nd ranked Inbee Park.

Spring Kick Initial Report

It’s remarkable how strong the data is for homes sold around North San Diego’s coastal region.  Most impressive is the number of sales in spite of higher pricing – there isn’t much drop-off!

These are houses sold between February 1 – March 15

Year
# of Sales
Median SP
Avg. $/sf
Avg DOM
2011
263
$865,000
$378/sf
91
2012
295
$785,000
$364/sf
94
2013
333
$840,000
$394/sf
64
2014
282
$939,500
$500/sf
51
2015
284
$1,110,000
$528/sf
52

Yesterday, the guy on CNBC who has predicted the last couple of bond-market moves said that he expects the 10-year yields will be down to 1.50% in the next few months, which should push mortgage rates under 3.50%. Waahoo!

rate

Mortgage for Self-Employed

2015-03-22 19.08.47

We haven’t been hearing much lately about how tight credit is choking off the housing recovery.  Once it was announced that the GSEs were going to purchase 97% loans for the first time is five years (which starts today), the tight-credit talk started to subside.

But you still have to qualify for a mortgage, which has always been difficult for self-employed folks who write off their expenses to lower their taxable income.  The obvious solution is to lower the write-offs and pay more taxes – but that goes over like a lead balloon with those who are used to creative accounting.

The common belief is that you need two years’ worth of tax returns to qualify.

But did you know that Freddie Mac will accept only one years’ tax return?

That’s right, and I just saw it happen.  I just had a self-employed buyer with excellent credit and a 20% down payment close escrow after qualifying by using their 2014 tax return only.  The Freddie Mac Loan Prospector (their automated-underwriting service) determines whether you need 1 or 2 tax returns – so as long as the computer approves, you’re in!

For the self-employed who had a strong 2014, you may want to bite the bullet and pay more tax now so you can qualify for a bigger loan.  The Freddie Mac maximum loan amount in San Diego is $563,350, which puts your payment around $2,700 per month, plus taxes and insurance.

Get Good Help!

Inventory Watch

This past week produced a nice pop on the low-end inventory, where we went from 69 to 84 active listings under $800,000 – a 22% increase!  But only 14 of those houses are between La Jolla and Encinitas – the rest are in Carlsbad.  We had 84 new pendings too – the most since mid-May of last year!

Click on the link below for the complete NSDCC active-inventory data:

(more…)

Selling House with Leased Solar Panels

solar

Hat tip to ‘just some guy’, who asked if I’ve had this happen.  Yes, and my buyers had to take over the lease but it went smoothly.  But could be a potential pitfall for less-engaged buyers!

http://www.latimes.com/business/realestate/la-fi-harney-20150322-story.html

Can going green by leasing solar panels for your roof cost you money — or give you headaches — when you go to sell the house?

Possibly both.

Say you get pitched by one of the growing number of companies offering solar panels at no upfront cost that they claim will save you lots of money on electricity bills. Sounds like a slam-dunk. So you sign on.

Then a few years later you decide to sell the house. You assume that the presence of solar panels can only be a marketing plus, maybe even get you a higher price. Everybody goes for green, right?

Read full article here:

http://www.latimes.com/business/realestate/la-fi-harney-20150322-story.html

More on the Haves

rolls

More on the ultra-rich and deals being made around L.A. – thanks daytrip:

http://www.latimes.com/local/california/la-me-lopez-otherhalf-20150322-column.html#page=1

It’s not uncommon on the Westside of Los Angeles for people to shell out $20 million or more for a house.

And then take a wrecking ball to it.

Jeff Hyland, of the high-end Beverly Hills real estate agency Hilton & Hyland, had a recent tear-down sale of $35 million in the Trousdale section.

“It was in absolutely magnificent condition,” noted Hyland, who would not reveal the owner’s name but said his client was happy to pay all that money “just for the dirt,” with plans to erect a dream house.

Tearing down a $35-million house in a region where the middle class is disappearing, affordable housing is scarce and multiple families are crammed into homes or apartments — not to mention the tens of thousands living on the streets — is the kind of thing that makes you think the world is about to end.

But that’s the way things are in the Westside hills, where there’s no shortage of buyers from around the world snapping up estates. Longtime residents, suffering in cramped 10,000-square-foot quarters, are squawking about new and rebuilt estates the size of aircraft carriers.

One house just sold for north of $80 million, right around the time the Economic Policy Institute published a study concluding that “more than half” the residents of metro Los Angeles “are struggling to achieve economic security.”

The year 2014 was the biggest on record for his agency, said Hyland, with $2.9 billion in sales across Beverly Hills and Bel-Air, through Brentwood and out to Malibu. But that mark could be topped in 2015, with Hilton & Hyland’s 100 agents chasing a target of between $3 billion and $3.2 billion.

“We’ve sold, I think, 10 houses this year for over $20 million,” Hyland told me while we toured some of the most expensive homes on the U.S. market in his Rolls-Royce Ghost.

“The Chevrolet of Beverly Hills,” Hyland said of his car, which rides like a dream. The base price for a new Ghost is about $300,000, or roughly the median price of a new house in the United States.

See the great video in this full article:

http://www.latimes.com/local/california/la-me-lopez-otherhalf-20150322-column.html#page=1

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