It is Cherry Blossom Time again at South Coast Botanic Garden on the Palos Verdes Peninsula.  This is the closest location for us to see the beauty and color of these trees.  And when the petals fall in the breeze, it is like a silent rain.  I often forget what a special place the Garden is.  One can roam around for hours enjoying beauty and nature.  It is a gift to our soul. 

South Coast Botanic Gardens has a full calendar of events (accessible by clicking here) ranging from a Cactus & Succulent Show, to a Mother’s Day Concert to a Ferrari Car Show.  The first Sunday and third Wednesday of every month at 8:00 a.m. they have Bird Walks in the Garden pointing out different and unusual species.

The Spring Plant Sale will be held Saturday, April 18, at 9:00 a.m.   It’s best to get there early as the interesting plants go fast. 

Oh my gosh… they must be kidding!  The new budget is calling for a reduction of the mortgage interest deduction. This reduction in deductible expenses will be for high income earners making more than $250,000 a year.  This group will see the deduction fall to 28 cents per dollar down from the current 35 cents for every dollar of their deductible expense.  In our area, this will effect a vast majority of home-buyers, which will further erode sales.   Please, please call your congressperson, your Senators and tell them no way, no how.  Here is today’s news release we received from the National Association of Realtors, who plan on fighting this all the way, and why they are doing so:

	Dear Fellow REALTOR®, You may have seen news reports about President Obama’s budget proposal that was released today at 11:30 AM Eastern Time. A small section of the sweeping budget plan has the potential to become a major impediment to a recovery in real estate markets across the nation. NAR is 100% opposed to the provision that modifies the Mortgage Interest Deduction and is prepared to use its formidable array of resources against its enactment.As currently drafted, the plan changes the Mortgage Interest Deduction by reducing the amount of mortgage deductibility on families earning over $250,000. This proposed change in the Mortgage Interest Deduction will result in further erosion of home prices and home values. If this proposal is enacted it will lead to a new round of price depreciation, will cause greater distress on the balance sheets of banks as the collateral value of mortgage backed securities declines. A second credit crisis could emerge before the first one is resolved. As you read this NAR is launching a multiphase plan of action to eliminate this provision from the budget plan. In the next 24 hours, NAR will be expressing our concerns directly to President Obama, to all members of the United States House of Representatives and the Senate, placing advertisements in the publications read by Washington, DC decision makers. Additionally, NAR will be forming a coalition with other groups affected by this proposal. This communication is the first part of our response, we will continue to update you as the situation and events warrant. Sincerely, Charles McMillan, CIPS, GRI 2009 NAR President

Can you qualify for the home buyer tax credit?  Maybe.  Here is what we know.  With the recently passed legislation, “first time” buyers who purchase a home between January 1, 2009 and December 1, 2009 may qualify for a $8000 tax credit.  What surprised me was reading that a first time home buyer is someone who has never owned a home before or hasn’t owned one during the three years preceding the 2009 closing date.

That surprise, according to Kenneth R. Harney (in the LA Times) means that “Carefully planning the timing of your closing could be worth thousands of dollars to you.  Say you owned a house earlier in the decade, but sold in on March 25, 2006. If you close on a house in 2009 before March 25, you do not qualify for the $8,000 credit.  Push settlement back to March 26 or later — any time before Dec 1, when the new credit program’s eligibility period expired — and you’re $8,000 to the better.” 

There is also an eligibility requirement.  Annual adjusted gross income may not be $75,000 or greater for an individual and $150,000 or greater for couples filing jointly.

Lake Forest is a great place to live!!!  It will be 30 years this April that I have lived here.  The community is safe (see page one of The Leaflet Newsletter, Jan.-Feb 2009), the schools are great, and it is close to just about everything.  According to a recent survey, I’m not the only happy camper.  The survey done in November 2008 found that 92% of residents and 87% of businesses are satisfied with the services provided by the City of Lake Forest ( page 4 of the Jan-Feb 09 Leaflet).  And it keeps getting better.

We now have an excellent variety of restaurants as well as plenty of shopping.  One way our residents can keep Lake Forest such a delightful place is to shop and dine locally.  Doing that not only keeps money in our community and supports local businesses, but also encourages more retail and eateries to consider Lake Forest in their search for new locations.  To get an idea of some of our local establishments, go to www.city-lakeforest.com/shopdinelakeforest.

My yoga teacher says its Alan Greenspan’s  fault. During the Clinton era he should have raised the interest rate as the economy grew. That would have stopped the bubble. He wanted things to look good and get re-elected.  Bush kept Greenspan also.

We all know economy is a combination of things. We can blame the Banks, the greed wherever it lives in politics, in the workplace, wherever.  What if it is true? What if it is not true?  Every person is trying to solve this puzzle.

I think the inventive talents in our world will lead us out of this one. What has history said about it? Build a better tomorrow. Transportation was the ticket to employment and growth. Energy ideas for transportation is the ticket yet to be played for real. Just watch the movie NETWORK. As soon as the big guys own the alternative resources we will get to have them.

We need a Hero. Actually we need the hero inside each of us to step out and lead with grace. We start with a better word than blame, and move on in this changing world.

What is a Broker’s Open House?  It’s an open house that Realtors host for other Realtors.  We have specific days on which we (Realtors) go out and see the new inventory in geographic areas.  For example, Tuesdays are for Palos Verdes area listings, Thursdays for Redondo Beach, Hollywood Riviera, & Torrance, and Fridays are for Hermosa Beach & Manhattan Beach.  Typically, these broker’s open houses are during the “lunch hour” so often there is food offered.  We find that when there is a little “snackie” agents will linger longer and appreciate the house a bit more….so why not offer a little tidbit to our fellow hungry agents!  (we sure like it and it sometimes helps us better remember certain properties.)  This is what you want to happen.  These Broker’s Open Tours are how we showcase our new listings to each other.  We network and chat it up about what’s happening in the business and in the local areas.   Agents know each other and we know who works what areas so we often discuss what new property is coming on the market or what type of property we are looking for our buyers.  It’s a must for agents who want to know their market.  Broker’s Opens are the most important open house! 

We will be hosting two open houses this Thursday, February 26th from 12-2 in the Hollywood Riviera.   Come join us for some lunch and a view of two wonderful homes!

635 Calle de Arboles - 5 Bedrooms, 4.5 bathrooms - 2006 Cape Cod Style - $1,545,000

and

308 Via Anita - 3 Bedrooms, 2 bathrooms - Ocean & Coastal Views - $1,155,000

The Montemalaga neighborhood is located in Palos Verdes Estates.  The best thing about this neighborhood is the fabulous ocean and Queen’s Necklace views (photo above) that many homes enjoy as this area is the highest elevation (up to 1380 feet) in Palos Verdes Estates. 

The Montemalaga neighborhood is roughly 1 square mile in area and has no ocean borders.  It is located on the hill above Lunada Bay, Malaga Cove and Bluff Cove and is bordered by Rancho Palos Verdes to the east.  Montemalaga has many of the largest homes on the Peninsula and the lots are among the largest in Palos Verdes Estates.  The largest home in this neighborhood is approximately 39,000 square feet.  Montemalaga Elementary School is located in this area.

This is strictly a residential area without any commercial or even multi-family housing.  There are currently 21 single family homes for sale ranging in price from $1,265,000 (1,805 square feet) to $12,999,000 (18,227 square feet).

Buyers are scrambling. They are starting to make multiple offers on forclosures. They are even not sure if there will be many REO  forclosures in the future for them.

The lender is first. Know what you can afford. This article has a section I think was noteworthy that I want people to read.

Mortgage rates remain significantly lower than six months ago. Back in August, the average 30-year fixed mortgage rate was 6.66%, meaning a $200,000 loan would have carried a monthly payment of $1,285.25. With the average rate now at 5.34%, the monthly payment for the same size loan would be $1,115.58, a savings of $170 per month for a homeowner refinancing now.

Survey Results

30-year fixed: 5.34% — unchanged from last week (avg. points: 0.41)
15-year fixed: 4.93% — down from 5.03% last week (avg. points: 0.41)
5/1 ARM: 5.37% — unchanged last week (avg. points: 0.45)

Bankrate’s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For more information, visit http://www.bankrate.com/mortgagerates.

Seldom do I find authors with such good out of the box thinking. Today Michael Hiltzik wrote a great article on social security. Read it and past articles here.   www.LAtimes.com/hiltzik

His premise is that the Social Security system was maligned by the privateers as something that needed fixing. He carefully explains the merits of the system and its scandal free, workhorse ethic that has met a need for Americans since it began. Refreshing view of the old way! Naturally the nay sayers had some better potion, snake oil to sell and the stock market was so now, so new and only for today not the old way to bless one and all. They had it only for the chosen few who followed them with the intent to get a good slice of pie they could not chop out of social security.

The press is a snapshot of now- the disposable information. However, this article is well researched and presented in the business section of Thursday Feb 13 La Times and could be missed too easily by anyone off to a holiday weekend and rushing to get work done before the exit.

An influence inspired by David Langer was part of the knowledge behind his viewpoint. There are compelling reasons to think that Social Security can be relied on, improved and added to in this article. My interpretation of his finding is this, social security could be thought of as a good Dad. He is setting aside a nest egg and has not been influenced to toss it away or bet it and lose it.

I am concerned that as I leave the old thinking of too much governement it turns out that is all we can turn to. They have the money.

I look forward to an article exposing the credit card behavior of bait and switch. Someone needs to throw some light on that

Todays message to California Realtors complete m

Feb. 18, 2009

Dear C.A.R. Member,

Earlier today, President Obama unveiled the Homeowner Affordability and Stability Plan, which will offer assistance to as many as 9 million homeowners, while attempting to prevent the destructive impact of foreclosures on families and communities.

The plan contains three main components, and only applies to primary residences. The loans referenced in the plan cannot exceed Freddie Mac/Fannie Mae conforming loan limits.  I’ve outlined the plan in greater detail below.

The first component is directed toward homeowners suffering from falling housing prices who still have equity in their homes, but no longer have the 20 percent equity needed to refinance.  Under the plan, homeowners who have conforming loans owned or guaranteed by Freddie Mac and Fannie Mae will be allowed to refinance their homes, even if they do not have 20 percent equity left in the house. The U.S. Treasury Dept. estimates that about 5 million homeowners will be helped by this portion of the program.

The second component, known as the Homeowner Stability Initiative, is designed to assist homeowners who are “underwater” on their mortgages. The $75 billion initiative will bring together lenders, servicers, and the government so that all stakeholders share in the cost of the modification.  Primary mortgages would be reduced to monthly payments that do not exceed a 38 percent debt-to-income ratio, with the costs of doing so borne by the lender. The government and lender then would split the costs of further reducing the monthly payments until they were at a 31 percent debt-to income ratio. An important aspect of the initiative is that homeowners do not have to be delinquent to participate.

The Homeowner Stability Initiative also will create incentives for servicers, mortgage holders, and homeowners. Servicers would receive an up-front fee of $1,000 for every eligible modification meeting the initiative’s guidelines. Guidelines are scheduled to be released by March 4. Mortgage holders will receive an incentive payment of $1,500, and servicers $500, for modifications made on loans that are current but at risk of imminent default.

The final aspect of the Homeowner Stability Initiative is creating clear and consistent guidelines for loan modifications. The Obama Administration plans to work with federal agencies, banking and credit union regulators, and the private sector in order to develop loan modification guidelines that can be implemented across the entire mortgage market. While adoption of the guidelines will be voluntary for the private sector, all financial institutions receiving Financial Stability Plan assistance going forward will be required to implement the loan modification guidelines.

The government estimates that between 3 and 4 million homeowners will benefit from the Homeowner Stability Initiative component of the plan.

The third component of The Homeowner Affordability and Stability Plan is supporting low mortgage rates by strengthening Fannie Mae and Freddie Mac.  The Treasury Dept. plans to increase their Preferred Stock Purchase Agreements with both Fannie Mae and Freddie Mac from its current $100 billion in both entities to $200 billion in each. The Treasury Dept. also will continue to purchase Fannie Mae and Freddie Mac mortgage-back securities in order to help promote stability and liquidity in the marketplace.  Additionally, the Treasury Dept. will increase Fannie Mae and Freddie Mac’s portfolios by $50 billion, for a total of $900 billion. The Obama Administration will work with Fannie Mae and Freddie Mac to support state housing finance agencies in serving home buyers, such as CalHFA. Funding for this will not come from TARP money but from the Housing and Economic Recovery Act.

While some of the details still are being developed, such as the modification guidelines, the Obama Administration plans on using programs and funding already allocated for The Homeowner Affordability and Stability Plan and will need little legislative approval for programs under the plan.

We’ll keep you updated on the Homeowner Affordability and Stability Plan as more details and information become available to us.

Sincerely,

James Liptak
2009 President
CALIFORNIA ASSOCIATION OF REALTORS®