As you may already know the Los Angeles prices of single-family homes, condos, land and, in small amount also multi-family buildings, declined in most cases approximately 20%. Real estate gurus as well as the California Association of Realtors are predicting that prices will decline a maximum of 5 more percent in the next few months. The declining real estate is/was caused by an enormous increase of foreclosures. Most of the homeowners that got into financial difficulties and fell behind with their mortgage payments have already sold or lost their properties. I started observing multiple offers on the remaining short sales, foreclosures and bank owned properties. The mortgage loan limits were increased to almost $730,000, but this is just temporary relief at this point of time. Along with other realtors, I am involved in writing letters to US Senator Dianne Feinstein. You may view her recent response that I received from her at http://www.movingtohollywoodhills.com
For your information I would also like to mention that if a home price declines 10%, it is equal to 0.5-1% mortgage interest increase. Therefore, it is my opinion that if you need/want to buy within the next few months, please start searching now. And if you are intending to sell your current home, I’d encourage you to wait if you can, until the market starts going up again.
Based on several inquiries & offers that I have been dealing with lately I am encouraging all my clients to get pre-approved, get at least the first page of the FICO score from the lender, make sure that you have enough money for down-payment on your bank account, plus a reserve for 3 months of mortgage payments, taxes and insurance. All this is a must in almost 90% of pre-foreclosures and foreclosures. Further on, it is also very helpful if I have on my hands a Buyer-Broker Agreement. If you have misplaced or never received that agreement from me, please contact me and I will re-send it. This agreement helps if I need to negotiate for example with the bank that owns the property, before we make an offer.
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