Tag Archives: Nef Cortez

Rents Skyrocketing?

Nef Cortez

By Nef Cortez

I have reported on home values rising fast in Diamond Bar. Today, wetake a look at how fast rents are increasing as well.

Home values typically follow the pattern of economic recessions, with prices increasing as the economy improves, and peaking at about the same time or slightly after the economy has reached its zenith.  Rents, however, appear to be immune to the rise and fall or cyclical nature of home prices or home values.  The predictable thing about home rental values is that over the years, they have consistently trended upward.

As an example, where home values took a dive of almost 30-40% during the Great Recession, rents maintained a level or flat trendline.  Since the end of the Great Recession in 2009, property values across the United States have come roaring back to their current heights.  The median sales price of a Diamond Bar single family residence (SFR) in the First quarter of 2018 reached a level of $735,000.  That represented an increase of 56% from the median sales price of $470,000.00 in the first quarter of 2010.

The Diamond Bar median rental rate for a Single FamilyResidence (detached) in the first quarter of 2018 stood at $2,860.00. This represented an increase of 30% from the median rental rate of $2,200.00   where it was in the middle of the aftermath of the Great Recession.  This represents an increase of $660.00 per month, which is not an insignificant number, but it is not the “stratospheric” increase seen in the  single family resale market values.  The rate of increase of rentals (30%) in the same period has been almost half of what the rate of the median price increase of homes values (56%) from 2010 to 2018.

Next week we will look at the Diamond Bar Townhome and Condominium rental market, and the comparison of rental for that type of property to the single family residential (detached).

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

Boomerang Buyers Re-enter Market

Nef Cortez

By Nef Cortez

“Boomerang Buyers”, homeowners that lost their homes through foreclosure or were forced to sell their homes as “Short Sales”, are re-entering the market.  The peak of foreclosure notice filings-bank repossessions, scheduled auctions, and default notices-occurred in 2010, passing the 2,870,000 mark. It surpassed the previous year’s record number of 2,300,000 filings.  The total number of filings since the mortgage meltdown begin to hit the housing market in 2005 stands at more than 19,000,000.

Homeowners that lost their home typically are required to wait 7 years before they would qualify for any of the Government Sponsored Enterprises (GSEs) such as the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), as well as the Housing and Urban Developments’ FHA program loans.

With approximately one third of all filings in 2010 having led to an actual bank repossession, at least 700,000 homeowners who lost their homes are now able to qualify for loans, based solely on that criteria. There are an additional 500,000 that also went through a short sale and would also now qualify for these government sponsored programs.  They need to have repaired their credit by establishing a good payment history since their repossession distressed sale in order to qualify in the now existing tighter credit environment.

This pool of more than 1,000,000 buyers, which represents close to 20% of the total number of home sales in the US this past year, will provide a further upward push on home prices by being able to compete with the already existing pool of homebuyers. This pool of buyers will continue to grow as those who lost their homes through foreclosure after the peak in 2010 also begin to re-enter the home buying market.

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website http://www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

Diamond Bar Condo Sales Update!

Nef Cortez

By Nef Cortez

The “California Screamin’” Roller Coaster ride that is the housing market continues! Diamond Bar Condominium and Townhome sales dropped like the downward hurtle after the “loop” at the famous Disneyland ride.  The number of recorded condominium and townhome sales in Diamond Bar dropped dramatically from 74 in the 4th quarter of 2017 to only 36 in the 1st quarter of 2018! The sharp drop in number of sales of more than 52%, however, has not impacted the median sales price in a negative way.  As a matter of fact, the median sales price of condo and townhome sales continues to climb, very much like the rising median sales price of single family homes in Diamond Bar.

The drop in sales from the 1st quarter of 2017 as compared to the 1st quarter of 2018 was not as pronounced as the change in market activity from the 4th quarter of last year. Diamond Bar saw a decrease of 29% in the number of sales year over year, comparing similar time frames.  There were 51 recorded sales in the 1st quarter of 2017, and only 36 in the 1st quarter of 2018.  A 29% drop is substantial-just ask any person who depends on their livelihood on the commissions earned in the housing industry. Not only are real estate agents and their staff affected, but so are loan agents and loan processors, escrow officers, title representatives and other title industry employees, home inspectors, and pest control operators and their employees.

As mentioned previously in this article, the median sales price continues to climb.  The median sales price of condos and townhomes in Diamond Bar in the 4th quarter of 2017 hovered around $374,000.00. That numbered climbed to $390,000.00 for the 1st quarter of 2018,  an increase of $16,000.00, or 17% on an annualized basis. That is a huge increase! So, the fewer number of Sellers that have come on the market and sold have benefited from the continuing problem for the industry as a whole, that is, the housing inventory shortage. These sellers that were able to get on the market and sell and get out are not complaining!

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

Diamond Bar Homes Sales Update

Nef Cortez

By Nef Cortez 

 

Homes Sales Down! True Home prices up! Median Sales Price is down! The trends have changed. The lower number of sales usually indicates a lower sales volume, and so do home prices. The fact that the number of homes sales in Diamond Bar decreased for a third consecutive quarter is not an indication of a lowering of demand for homes in this community. It is more of a reflection of lower inventory, less homeowners putting their homes on the market, and resulting in fewer choices for those looking to buy a home. The 4th Quarter 2017 report for Diamond Bar home sales noted that there were 98 closed transactions (as reported by the California Regional Multiple Service). The median sales price (Median Sales Price is the point in which half of the homes sold for more and half sold for less) in the 4th quarter was $745,000 for a single family residential (SFR) property. The 1st Quarter 2018 saw a drop of $10,000 in that figure from $745,000.00 down to $735,000.00. This represented a DROP of 1.3% quarter over quarter, or 5.2% annualized.  This represents a normalization of the median sales price of Single Family Homes (detached) in Diamond Bar, which have been sky rocketing.  The number of transactions, however, was down from 90 in the 4th quarter (October to December 2017), to 78 in the 1st Quarter 2018.  This represented a drop of 13.3% from the previous quarter.    

The seasonal housing market cycles are not as pronounced in Southern California, and more specifically, in Diamond Bar, as they are in other parts of the U.S.  It is, however, not very unusual for the market to slow down at this time of the year because it covers a period which includes major holidays like Thanksgiving, Christmas, and the New Year’s Holiday. The Diamond Bar home sales show an even greater drop in number from the 1st Quarter 2017.  The Los Angeles county recordings show that the Diamond Bar closings fell from 98 down to 78 year over year comparing the 1st Quarter 2018 to the same period 2017. That is a drop of 20.4% from one year to the next.  That is a huge drop in this industry. Real Estate professionals have been impacted in a fashion similar to a person having their annual income reduced by 20%.  Not good for those counting on that income to make ends meet.  We will report on the Townhome and Condominium market in next week’s edition.  

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate. 

Sources of a Down Payment

Nef Cortez

By Nef Cortez

 

How much money does a person have to have in order to buy one’s home? The answer to this question, of course, varies in many ways. One variable is in what city one decides to make their home. That decision, of course, will affect the price of homes that a person has to choose from. The price of a home, then, will impact greatly the amount of cash one must come up with as the Down Payment.

Another major variable will be whether a person is buying as a First Time Homeowner, a Move-Up Buyer, or a Down-Sizing Buyer. By the very definition of a “First Time Homeowner”, this buyer usually has a low level of savings. They are just getting started with their home ownership experience, and are usually in their mid to late twenties and into their mid-thirties. As I wrote before, this group of buyers is usually busy getting started with both their careers and their family. The lower income earned by those just beginning their careers coupled with the expenses of getting started in the raising of a family does not allow for the typical First Time Homebuyer to come up with a very large down payment.

One of the more commonly used loan programs for the first time homebuyer is the Federal Housing Administration 203B program.  It is a loan in which a first time homeowner can purchase a home with as little as 3 ½ % down payment. In addition to this type of loan, there are a few “grant” or “subsidy” programs which will also assist this buyer with an additional 2 % for the down payment. This facilitates the purchase of the First Time Homebuyer to finance the purchase with as little as 1 % Down Payment.

The FHA loan limit for a Single Family Residence in Los Angeles County is $636.150.00.  This means that a First Time Homebuyer can purchase a home with a little as $16,500.00.  With other grants or subsidies, this figure can end up as low as $6,500.00, making the purchase of a home very doable, as far as the Down Payment is concerned.

This article was written by Nef Cortez, a licensed Real Estate Broker, Cal BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.  

 

Prepare To Buy Right Part 2

Nef Cortez

By Nef Cortez

Last week I wrote regarding what a buyer needs to do to prepare to buy a home. Steps such as accumulating a down payment, developing credit, as well as others steps they can take to prepare were presented. Here I now present some of the next steps: finding a realtor, finding a lender, and locating the home. Purchasing a home will be one of the biggest investments a buyer will make!

First task-Finding a realtor: ​

Experience matters! What determines experience? Knowledge and familiarity with the process of buying from beginning to end is the most important. A  Buyer needs to  utilize the internet, referrals, networking, and/or attending open houses to search for an agent. Interview more than one agent. Know the reputation of the agent’s brokerage company. Establish a comfortable working relationship. A buyer’s choice of whom will represent him/her will prove to be a “make it or break it” to find the best deal.

Second Task-Finding a lender:

Finding a lender is similar to finding a realtor. Find a lender from a bank’s lending department, a Realtor’s “in house” mortgage department, referrals, and/or an already established working relationship between realtor and lender.Again, interview the lender to assure yourself who will best represent you.

According to Brian O Connell’s article, Pre-Qualified Vs. Pre-Approved–What’s The Difference?– September 12, 2017. “Getting pre-qualified is the initial step in the mortgage process.” The results supply a bank or lender with a buyer’s “overall financial picture including debt, income and assets….” thus giving the mortgage amount for which buyer qualifies. “Loan pre-qualification does not include an analysis of your credit report or an in-depth look at your ability to purchase a home.”

Third Task-Buy Right:

Buyer should develop a strong sense of their home preferences, location, and the qualities of the community they want to reside in. As to the different options a buyer has to purchase a home, consult with the realtor and/or lender for more information. A Realtor can guide and streamline the purchase process for a Buyer. Utilize reputable websites. Website content should be current and accurate. The best websites should have data derived from first hand sources such as multiple listing services and Realtor associations. Please check out my website at www.nefcortez.com.

This article was written by Nef Cortez, a licensed Real Estate Broker, Cal BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

 

Prepare to Buy Right

Nef Cortez

By Nef Cortez

Zig Ziglar, motivational speaker/author quoted: “Success occurs when opportunity meets preparation.”  How does opportunity meet up with a home buyer? Opportunities will present themselves.  Important prerequisites for a home buyer to include in their planning to be “buyer ready” and prepared to buy right and at the right opportunity are: build credit, save money for down payment, and research home ownership options.

Build Credit: Establish good credit history for eligibility and secure financing for a home loan. Set the foundation for good credit by making small purchases on credit and on-time payments. In exchange, companies measure a person’s creditworthiness by use of a FICO score. The higher the FICO score, the less risk to a lender. According to wellsfargo.com financial education/credit management, “the more your credit history shows that you can responsibly handle credit, the more willing lenders will be to offer you credit at a competitive rate.”

Save Money for Down Payment: Start small, create savings plan, and set aside money on reserves. Expense reductions i.e. “The Latte Factor,” the idea that money can be saved by cutting small, recurring daily expenses will result in big savings (frugalgene.com). Set goal, boost up savings to build larger sum of money. This prepares a buyer the ability to provide a down payment customarily required in many major purchase transactions.

Research Home Ownership Options

Home preferences, location, neighborhood, and affordability are home ownership research items. In an internet search, keep in mind the website’s content to be current and accurate. Establish relationships with realtor and/or lender for professional guidance and purchase options. Become familiar with real estate market conditions.  As a buyer prepares, they have the opportunity to make the right buy that fits their needs. A well-informed buyer will buy right and at the right time.

This article was written by Nef Cortez, a licensed Real Estate Broker, Ca BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

 

 

Where Will Our Children Buy?

Nef Cortez

By Nef Cortez

Some have likened living and raising a family in the wonderful community of Diamond Bar to the “fantasyland life experienced at Disneyland”. Many longtime residents of Diamond Bar have worked their way up to being able to afford this safe and beautiful community.  The comparison of where they live now to where they were raised leads to that dialogue. The question that came up in conversation the other day (and has at many previous times) was, “Where will our children be able to afford to buy a home?”

A few weeks ago I wrote on the decreasing affordability of housing in Diamond Bar. The issue is being raised in many communities across the country, so it is not a problem unique to Diamond Bar. The issue is fairly simple…the price of housing is more expensive the more desirable the Community is. Diamond Bar is one of the safest communities in the State of California, and the housing stock is newer in comparison to many of the surrounding neighborhoods, making it a very desirable and highly competitive market. It is renowned for its high performing schools throughout the world, and foreign nationals seek to purchase homes in Diamond Bar for that very reason.

A few weeks ago I wrote an article detailing the median income necessary to qualify for the median sales price of a detached single family residence (SFR). It was quite an eye-opener to see that the annual income necessary to qualify to purchase that home was $165,000.00. Not only is that income necessary to qualify, but in order to do so, a buyer would have to put $150,000.00 as a down payment.  Quite a daunting task for most 20-something or 30-something year olds.

The answer to the question “Where will our children be able to afford to buy a home?” raised above came quickly from someone who overheard our conversation…”Far, Far away!” came the immediate response! The higher the prices go, the further one has to travel inland to find affordable prices…Think Inland Empire, or even further into outlying less expensive communities.  Many are choosing to go to  other states, such as Nevada, Arizona, and Texas.  Those are definitely more affordable Housing markets!

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate

Diamond Bar “Fix and Flip”

Nef Cortez

By Nef Cortez

Are there fix and flip opportunities in Diamond Bar? It appears there are.

Generally, fix and flip opportunities are more common in communities that are long established, where the housing stock is older, and the combination of time and deferred maintenance intersect to provide the “perfect storm” that allows for the fix and flip opportunity.

The search for these kinds of opportunities are more likely to result in a larger and more established city like Los Angeles, or San Bernardino, or Riverside.  Diamond Bar is a more limited and very competitive environment.  Diamond Bar, where the median sales price of a single family detached home reached $745,000 in the fourth quarter of 2017, requires an investor that has a higher level of resources and cash liquidity in order to compete for these opportunities.

The most recent case that I am aware of that was clearly a “fix and flip” in Diamond Bar  occurred in the south part of the city. The home, located walking distance to Diamond Bar High School and H-Mart, was listed as a 3 bedroom 2 bath home with a little over 1500 square feet. Los Angeles County Public records show that that investor was able to purchase the property at $515,000, although the California Regional Multiple Listing Service has it at $525,000.  Within 6 months, the property was completely rehabbed and resold for slightly over $700,000.  This generated a gross profit of $175,000 to the investor/flipper. Not bad for a few months’ worth of work!

There are always opportunities that may come up, some better than this one, and some not.  It does require constant vigilance, a constant search, and being prepared financially when the opportunity does show up.  These opportunities do not wait for one to get ready…one has to be ready ahead of time. Best advise is, if you are interested in fixing and flipping, be ready!

This article was written by Nef Cortez, a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

Diamond Bar Housing

Nef Cortez

By Nef Cortez

The Diamond Bar housing market has achieved a median sales price which is at an ALL TIME high!

The roller coaster ride that has been housing sales prices in the last 30 years is now achieving new record high levels.  Factors that drive this market to its current high include a shortage of inventory, historically low levels of mortgage interest rates, continuing in migration of foreign nationals, and a strongly surging economy.

Exciting as it is for the current property owners, it is becoming increasingly difficult for many buyers to find what they are looking at an affordable price.

The median sales price last reported by the California Regional Multiple Listing Service (CRMLS) for Diamond Bar Single Family homes in the 4th quarter of 2017 was $745,000.00. Seeing an annualized increase of 11% in the median sales price for Diamond Bar homes brings up the question of affordability.

The surging economy notwithstanding, we are not seeing annual wage increases of 11%.  The wage increases have to keep up with the rate of increasing sales prices, or housing reaches its breaking point of affordability. The current US Census figures report (the last surveyed years of 2012-2016) a median household income for Diamond Bar households to be $89,845.00.

With the median household income as it is the obvious question is; how many Diamond Bar households can actually afford to buy a home? The purchase of the median priced home would typically require a down payment of 20 % of the purchase price, which in this example would be $150,000.00. The loan balance would be just under the Jumbo loan limits at $600,000.00, carrying an interest rate of approximately 4.375 %, with an APR of 4.375%.  The payment of principal and interest on this loan would be $2,996.00, taxes would be $782.00, and Homeowner’s Insurance an additional $80.00 per month, for a total of $3,858.00 (PITI). Conforming guidelines (FNMA and FHLMC) for loan qualifying require that no more than 28% of the household income be utilized for housing cost, in this case it would represent a monthly income of $13,778.00 necessary to qualify. This monthly income represents an annual household income of $165,000.00 necessary to qualify for the median priced single family home in Diamond Bar, or almost twice as much as the current level of the median household. Wow!

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com or website http://www.nefcortez.com. Please feel free to email any questions regarding real estate.

NEF CORTEZ,
Broker  DRE # 00560181

RE/MAX Universal Realty
1411 S. Diamond Bar Blvd.,
Diamond Bar, Ca.  91765
e-mail: nefcortez@gmail.com

http://www.nefcortez

Office: 909-610-6303
Fax:  909-752-3163
Cell: 909-762-8135

Certified REO Broker
Certified Distress Property Expert

 

Eaten Out Of House…

Nef Cortez

By Nef Cortez

​…And Home!.  Many a person who is a head of a household makes this outcry when facing the burdens and responsibilities of having to provide for their families.  They feel so burdened by trying to make ends meet, such as the home mortgage, the taxes, the insurance, utilities, and food.  However, there are much smaller “critters” that can literally “eat” a person “out of house and home” These are pesky little things called termites have been around forever!  Termites are known to eat a lot!   Per Pest World for Kids- sponsored by The National Pest Management Association, “Termite colonies eat non-stop, 24 hours a day, seven days a week!” “They can destroy building foundations, wooden support beams, plastic plumbing pipes, sub-flooring, insulation … even swimming pool liners and filtration systems! Termites can also injure or destroy living trees and shrubs.”

However, we do not want these pesky little creatures in our home to eat up the wooden frames, roofing, window sills, etc.  So why does the real estate industry recommend that an owner of a home regularly schedule inspection and maintenance and to treat the property to control termites before they “eat us out of house and home”? Avoiding the damaging effects of the termites’ ravaging hunger!

The advantages of preventative maintenance boil down to Savings:  If you plan to sell your home, preventative measures are less expensive in costs than having to fix an item after termite damage.  The repairs may add up and subtract from the equity that you have worked so hard to earn on your investment, your home.

Have you seen a tent over a home and wondered, Why that?  That is the indication that the entire structure needs to be treated in treatment.  That is what one would want to avoid having through preventative maintenance. There are various methods in treating against termite, ranging from chemicals to more environmentally friendly (natural) methods.

Find a reputable and licensed termite company that you feel comfortable working with, or referral from family or friends, or you may ask a realtor, or do your own due diligence search.  Consulting with this type of expert will help you plan for your bottom-line savings!  Saving your home!

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

Diamond Bar Home Sales Update!

Nef Cortez

By Nef Cortez

Homes Sales Down! Home prices up! Usually when sales volume goes down, so do home prices. The fact that the number of homes sales in Diamond Bar decreased for a second consecutive quarter is not an indication that there is a lowering of demand for homes in this community. It is more of a reflection of low inventory, or fewer choices for those looking to buy a home. The 3rd Quarter 2017 report for Diamond Bar home sales noted that there were 103 closed transactions (as reported by the California Regional Multiple Service). The median sales price (Median Sales Price is the point in which half of the homes sold for more and half sold for less) in the 3rd quarter was $725,000 for a single family residential (SFR) property. The 4th quarter saw a rise of that figure up to $745,000, an increase of 2.76%, or an annualized increase of 11%! That is Huge! The number of transactions, however, was down to 90 in the 4th quarter (October to December 2017), representing a drop of 12.6 %, which is also substantial.

The seasonal housing market cycles are not as pronounced in Southern California, and more specifically, in Diamond Bar, as they are in other parts of the U.S.  It is, however, not very unusual for the market to slow down at this time of the year because it covers a period which includes major holidays like Thanksgiving, Christmas, and the New Year’s Holiday. The Los Angeles county recordings also show that the condo and townhome markets slowed similar to the SFR market. Diamond Bar Condo and Townhome sales dropped from 81 to 70  in the 4th quarter, a drop of 13.5%.  Unlike the rise in the median sales price for the SFR market, the Condo and Townhome median sales price dropped by 4.4 % quarter over quarter, an annualized drop of 16%! For the Diamond Bar Condo and Townhome market, the 4th quarter of 2017 saw both a sales volume and a median sales price drop from the previous quarter.

 

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

 

 

Interest Rates Going Up?

Nef Cortez

By Nef Cortez

Housing affordability is greatly affected by the interest rate that one can secure when obtaining their loan. Interest rates go up and down, and are largely influenced by forces that affect all markets: Supply and Demand. Due to the Great Recession of 2008, long term mortgage interest rates have been low for the past decade.  Historically low interest rates have driven the market prices of homes to levels that exceed the high point of the housing market in 2006.

One of the two main factors that Federal Government affects the Supply side of the mortgage equation is by purchasing or selling Treasury bonds or mortgage backed securities (based on previously originated home loans). When the Federal Government buys debt through this mechanism, it will either increase or reduce the supply of money in the open market, thereby affecting the increase or decrease of money available to use as a loan to purchase a home.

The second primary factor that will influence the interest rates is the “Demand” for money. As is occurring right now, a growing and improving economy creates more jobs.  More jobs translate to more employees who can then afford to compete for mortgage money. It also creates increased competition between employees who can vie for improved positions and higher wages.  We are beginning to see that with the continual announcements of 17 year lows in the unemployment rate.

With the current effort by the Federal Reserve to reduce its balance sheet (reduce its debt), it is selling off Treasuries and mortgage backed securities which soaks up some of the available cash in the market. This is in itself an action that is reducing the Supply of money in the open market, and thereby putting upward pressure on interest rates.

The gradual decrease in Supply of money, combined with the growing Demand for money, is exerting upward pressure on interest rates.  It is almost certain that we will see an increase in mortgage interest rates over the next 1-3 years.

This article was written by Nef Cortez, a licensed Real Estate Broker in Diamond Bar Ca, DRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

 

Rent or Buy?

Nef Cortez

By Nef Cortez

Most people start their independent living when they first move out of their parent’s home by renting.  They either choose to rent a room at another person’s home, or possibly move into a friend’s apartment. Many times they go from that living arrangement to sharing the cost of renting an apartment or house together with a few friends or just someone else.

Although everyone has their own decisions to make, and many different circumstances, across our country, we tend to follow a consumer pattern throughout our lives.  Many financial analysts have studied the consumer cycle, and an established pattern has been the following for our society at large: one first starts working in their early late teens and into the early 20’s, and then family formation follows in the mid-twenties to mid-thirties.  Typically, at the stage of family formation and into the cycle of a young family  is when most of us address the issue of “Buying versus Renting”.  At this stage, there are usually young children in the household, and the provision for a home with a yard for the children to play in becomes a major concern.

Currently, the rental rates are very high, and have been increasing substantially at 5% plus per year over the last 6-7 years. This highlights the need to stabilize the monthly housing cost, and with current interest rates, it is a very good time to lock in a low rate by buying a home. Many economists are predicting interest rates will increase this year.  Just this week, the Federal Reserve approved its second rate hike of the year, increasing its benchmark interest rate by one-quarter percent.  This rate hike eventually gets spread out to consumer interest rates.

There are many other factors that come into making a decision on whether to Rent or Buy. Next week, I will provide in more detail those factors, as well as show a point by point comparison on the options.

This article was written by Nef Cortez, a licensed Real Estate Broker, Ca BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com.  Please feel free to email any questions regarding real estate.

 

Why Sell Now?!

Nef Cortez

By Nef Cortez

How can it be a good time to buy and at the same time a good time to sell?

Real Estate is local!  Although Macroeconomic factors are the overall influence on the real estate market, individual property values are most influenced by local market conditions. We have all heard the mantra “Location, Location, Location!” in describing the desirability of homes. The right area…the right school district…and for some people, even the right orientation.

So when is it a good time to sell?

Now would be a good time to sell and “move up”, If you are going to outgrow your current residence within 2-5 years, thereby locking in an interest rate that is still close to historical lows at just under 4 %.

If you are going to downsize due to retirement, or have become an empty nester, it is a good time to sell and lock in the dramatic gains achieved by the huge increase in property values over the last 5 years. Even if you go out and rent for a while, because you are not able to determine exactly where you want to settle in…it might be better to rent in a couple of different locations, sort of “scouting” those areas out to make sure you like them before making the permanent investment.

This article was written by Nef Cortez, a licensed Real Estate Broker, Ca BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com.  Please feel free to email any questions regarding real estate.

 

 

 

Real Estate Resolutions 2018!

Nef Cortez

By Nef Cortez

Here we are at yet another New Year!  Time seems to pass us by so fast!  And as usual at this time of year we sit back and reflect what we accomplished last year and vow to make the New Year 2018 better with our New Year’s Day resolutions! And while you are bound to make at least one resolution, now is the time to start your planning and get a head start at it!  Do not wait a minute longer!

Let’s reflect what I wrote to you about last year:  I informed you on market status and let you know that the prices of sales of homes increased and continued to increase throughout the year.  I let you know that the time was right to buy and/or sell and the benefits to your family.  I also let you know why purchasing a home was best for you and your family instead of renting!  I informed you on what was being done for housing the homeless, and the current housing inventory shortage.  I gave you ideas on buying right, different sources of down payment, and kept you abreast of tax reform and housing legislation.

To start your resolution, reflection is important.  Where you are in life right now and where you want to be.  What do you want to accomplish this year in comparison to last year?  What are your financial goals? Remember, look to your sources for advice and guidance.  No questions are silly questions when you resolve to learn about a process and initiate action.

If you do not want to continue renting and paying those monies to someone else, if you want ownership, or if it helps you in your finances, then start the process of buying.

If you want to make a move, research and find out if moving or downsizing is best for you.

No matter what you resolve to do, or no matter how small a step you take towards that direction, get started!  It can only end up being a benefit to you and your family!

This article was written by Nef Cortez, a licensed Real Estate Broker, Cal BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

NEF CORTEZ,
Broker  CalBRE # 00560181
Certified REO Broker
Certified Distress Property Expert

ReMax Realty 100

1411 S. Diamond Bar Blvd.,

Diamond Bar, Ca.  91765

e-mail: nefcortez@gmail.com

Office: 909-610-6303
Fax:  909-752-3163
Cell: 909-762-8135

 

Housing’s Happy New Year!

Nef Cortez

By Nef Cortez

The Real Estate market has seen a continuing upward price increase in the last twelve months, closing out 2017 with a gain of approximately 6% across the US.  The prices have been increasing similarly here in Diamond Bar for the same period. The major concerns for the housing market over the last couple of months was the expected impacts of the Tax Reform and Jobs Act that was just passed last week by Congress and signed into law by President Trump.

There were fears that the mortgage interest deduction was going to be cut in half, from a level of  $1million dollar loan down to $500,000.  The reconciliation was arrived at a $750,000.00 level, which benefited the housing market in most states except for California, New Jersey, and New York. This change will negatively impact those markets more so than it will the major portion of the country.

Locally, the expected decrease in the mortgage interest deduction will have an impact, but not as much, and not as soon, as it would have if the cap had been reduced to the $500,000 level. Median Home Sales Prices are expected to increase here in Diamond Bar as well, but not as much as the 6% expected nationally. On the lower end of the price range, we will probably see a larger increase in the prices, as the mortgage interest deduction is still a great benefit for the buyers of homes at prices below the $750,000. That allows for ½ of the market to benefit from this tax incentive.

2018 should see a continuing increase in prices, primarily because the interest rates remain low, the inventory of homes for sale is extremely tight, and employment continues to increase. These are all the economic factors that influence market prices, and into the near future, they all indicate solid strength.

Have a Happy and Prosperous New Year Everyone!

This article was written by Nef Cortez, a licensed Real Estate Broker, Cal BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

NEF CORTEZ,
Broker CalBRE # 00560181
Certified REO Broker
Certified Distress Property Expert

ReMax Realty 100

1411 S. Diamond Bar Blvd.,

Diamond Bar, CA 91765

House and Senate Pass Tax Reform and Jobs Act

Nef Cortez

By Nef Cortez

The House of Representatives and the United States Senate have now passed the Tax Reform and Jobs Act, and will send the legislative bill to President Donald Trump for signature. There are some major changes in the Tax Act that will directly impact the housing industry and the real estate market. Specifically, It is slated to cut the Mortgage Interest Deduction from the maximum loan amount on the primary residence at $750,000.  The current level is $1 million dollars.  The approved mortgage amount amount is up from the originally proposed $500,000 loan maximum.  The reconciled amount will help most real estate markets outside of California, New Jersey, and New York, where the prices in the larger metropolitan and most populous areas of these states will definitely suffer a loss of interest payment deductibility.

The National Association of Realtors (NAR) economic policy group predicts that there will be a deflationary impact on the real estate market and home values for the upper levels of the market.  The limitation on the State and Local Property Tax deduction has been set at $10,000. This is another change that impacts high priced areas as opposed to lower or middle priced markets.

What is in the Tax Reform and Jobs Act to offset these negative impacts on the real estate markets? The primary objective is to ramp up the economy by releasing extra money into consumer’s pockets in the very first month of the year 2018 by reducing the taxes taken out of their paycheck. This should result in creating more demand by increasing the buying power of the consumer.  Higher demand increases competition, which will increase the prices in these markets.  That increased demand is expected to prop up the prices in those markets in areas that will be negatively impacted by the changes in the Tax Reform and Jobs Act.

This article was written by Nef Cortez, a licensed Real Estate Broker, Cal BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com. Please feel free to email any questions regarding real estate.

 

Diamond Bar Home Prices Soften!

Nef Cortez

By Nef Cortez

Home prices in Diamond Bar have softened for the first time since the upturn from the Great Recession. According to the California Regional Multiple Listing Service, the Median Sales Price for all homes, townhomes and condominiums Sold in  Diamond Bar in the 3rd Quarter of 2017  stood at $580,000. (The Median Sales Price is the point in which half of the homes sold for more and half sold for less). The Median Sales Price for all homes including townhomes and condominiums for the 2nd quarter of 2017 was at $625,000.  This represented a drop of $45,000 in the median price of all sales in Diamond Bar when comparing 2nd Quarter to 3rd Quarter results, a 7.2% drop.

The Median Sales Price of all sales in the 3rd quarter 2017, however, had an increase of $8,000 when compared to the same period in 2016 – a small increase of 1.4%.  This small increase appears to be almost flat when comparing it to the previous year. The increase in other communities across the State of California, and the rest of the US,  have seen annual increases in excess of 6%.  The number of closed transactions also had a dramatic drop.  There were 237 properties that changed hands in the 2nd quarter of 2017. In comparison, there were only 184 reported sales in the 3rd quarter of this year, representing a drop of 53 sales quarter to quarter.  This reflects  a substantial drop of 22% in the number of reported sales! That is a Big number in the industry! No one likes to see a drop like that, let alone a drop in the double –digits!

The numbers for Single Family Detached residences saw the bulk of the drop in numbers of reported sales, although the Median Sales Price saw a slight increase of $10,000 quarter over quarter.  The Median Sales Price went from $715,000 to $725,000, a small increase of 1.4%.  The number of sales of Single Family Detached homes went down from 162 in the 2nd quarter to 103 in the 3rd Quarter.  This compares to a similar number of reported Single Family Detached home sales for the 3rd quarter 2016.

What does all this mean? Simply put, the Diamond Bar real estate market has seen an increase in the number of townhome and condominiums sold with a parallel drop in the number of single family detached homes. The Median Sales Price drop is more or a reflection of a higher proportion of Townhome and Condo sales than an actual drop of real estate prices in general.

This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at nefcortez@gmail.com, or website www.nefcortez.com. Please feel free to email any questions regarding real estate.

NEF CORTEZ,
Broker  CalBRE # 00560181
Certified REO Broker
Certified Distress Property Expert

ReMax Realty 100

1411 S. Diamond Bar Blvd.,

Diamond Bar, Ca.  91765

e-mail: nefcortez@gmail.com

Office: 909-610-6303
Fax:  909-752-3163
Cell: 909-762-8135

 

Rent or Buy?

Nef Cortez

By Nef Cortez

Most people start their independent living when they first move out of their parent’s home by renting.  They either choose to rent a room at another person’s home, or possibly move into a friend’s apartment. Many times they go from that living arrangement to sharing the cost of renting an apartment or house together with a few friends or just someone else.

Although everyone has their own decisions to make, and many different circumstances, across our country, we tend to follow a consumer pattern throughout our lives.  Many financial analysts have studied the consumer cycle, and an established pattern has been the following for our society at large: one first starts working in their early late teens and into the early 20’s, and then family formation follows in the mid-twenties to mid-thirties.  Typically, at the stage of family formation and into the cycle of a young family  is when most of us address the issue of “Buying versus Renting”.  At this stage, there are usually young children in the household, and the provision for a home with a yard for the children to play in becomes a major concern.

Currently, the rental rates are very high, and have been increasing substantially at 5% plus per year over the last 6-7 years. This highlights the need to stabilize the monthly housing cost, and with current interest rates, it is a very good time to lock in a low rate by buying a home. Many economists are predicting interest rates will increase this year.  Just this week, the Federal Reserve approved its second rate hike of the year, increasing its benchmark interest rate by one-quarter percent.  This rate hike eventually gets spread out to consumer interest rates.

There are many other factors that come into making a decision on whether to Rent or Buy. Next week, I will provide in more detail those factors, as well as show a point by point comparison on the options.

This article was written by Nef Cortez, a licensed Real Estate Broker, Ca BRE # 00560181 since 1976. He can be reached via e-mail at nefcortez@gmail.com.  Please feel free to email any questions regarding real estate.