Photo of my very own “I Voted” Sticker

Exercise Your Political Muscle and Vote!

Exercise is good for your body and mind. Exercising your political muscle strengthens your community and the nation. Your vote matters. Just do it!

Go on, get to the polls and vote!

Photo courtesy of The Truth About Mortgage
With the financial markets in turmoil, and with the luster lost in the real estate market, one wonders where the savvy buyer/investor is placing his/her dollars. If you remove gold bullion, and/or stashing your money under the mattress from the safe haven equation, I would say that the REO (real estate or bank-owned) market is currently vying for the home buyer’s/investor’s cash.

I’ve been tracking the REO market here in Irvine for my buyers and sellers. Buyers want to know that if they decide to purchase a home now that their investment is protected from a further market decline. They feel that if they focus on foreclosed properties, then they have, to some extent, a built-in cushion just in case the real estate market experiences further declines. Whether or not this perception proves to be true is still debatable. However, this is the buyer’s/investor’s view of the current state of the real estate market.

On the other hand, sellers want to know how the foreclosure market is impacting their ability to sell their home in a declining and credit-tight real estate market. Equity rich sellers (and there are still some of those out there) who need to sell their home in the current real estate market, are finding that they have to price their property as aggressively as the REOs if they hope to be able to compete for today’s buyers. Even if sellers were to postpone selling their property in the immediate future, foreclosed properties in individual neighborhoods will certainly impact the comparable values of those future sales.

That said there is only about 20 to 40 real estate owned properties on the market at any given time in the city of Irvine–a relatively small number as compared to other south county cities. Those bank-owned properties that are aggressively priced and in an “interior” location (not backing to a busy street/freeway) are selling quickly and on multiple offers–many of which are all cash rather than lender financed.

Personal experience has demonstrated that unless you prepare your buyer for the REO experience, your buyer/investor may be disappointed, and may not be the successful/”winning bidder.” All REOs require that any offer be backed by high credit (FICO) scores, i.e., those 729 and above (and rising) if lender financing is applicable, and verified funds for the down payment and closing costs related to the purchase. Most will require that buyers be pre-approved by the individual bank’s lender of choice. Bank-owned properties are sold in “as is condition,” subject to the buyer’s inspection rights. What you see or what the inspectors find is what you get or choose not to get. If the costs of repair are prohibitive, the buyer need not continue with the purchase.

However, be aware that some of these foreclosed properties have deferred maintenance or are in need of repairs–the cost of which should be taken into account by buyers who are not contractors or who may not have easy access to one (i.e., a family member who can help refurbish). Also understand that the bank, who has already taken a huge loss, is not interested in the buyer’s list of repairs/requirements.

The REO properties in which I have personally been tracking have been sold at or above the asking price with little or no repairs being made. This may also include termite damage. A bank may provide a Termite Report, but may require the buyer/investor to cover the cost of any or all of the repairs. Other items for which buyers may have to pay include Association transfer and or document fees, and any other fees the bank chooses not to cover. These may show up in a lengthy addendum that the bank furnishes to the prospective buyer(s). Be aware that the bank/seller does not sign on any documents until there is full agreement by the buyer(s) with initials/signatures on all the paperwork including the bank’s addenda.

A striking example is one in which my partner and I previewed on a Sunday evening a week ago. It was a 3 bedroom, 2 bath single family residence on an interior corner lot of over 5,000 square feet in an established Irvine neighborhood. Upon entering, we discovered that the home had been vandalized to the extent that windows were broken, appliances were smashed, and holes were put through walls throughout the homes. We immediately phoned the bank’s agent to advise him of the state of the home. A return phone call the following day revealed that the listing agents were well aware of the vandalism (sadly it turns out that the irate homeowner who lost the home had unleashed a blind rage resulting in the destruction throughout this one-time upgraded and cared for home). The bank, however, we were told, would not be making any repairs except for the broken windows and would not be responsible for approximately $7,000 in termite damage that a recent report had revealed. However, no worries, there were already several offers, a few of which were all cash, and the property was going to be placed in “back-up” status that very day. Why would there be multiple offers on a home that someone had taken a sledge hammer to? One reason might have something to do with the fact that it was a single family home on a large lot in a good location within an established Irvine neighborhood that the bank had priced under $500,000! The other reason might have to do with the REO fascination factor: namely, buyers perceive properties that are tagged as “bank-owned” to be where the “great deals,” are whether they ultimately cost the buyer more in the long run in out-of-pocket fix-up costs.

On Saturday, I previewed a 3 bedroom, 2 bath single family residence in an adjacent neighborhood which was also in need of some repairs. However, it was in a good, interior location on a large lot. Yesterday, I brought back a potential buyer. Within minutes of my arrival, several more real estate agents some of whom had brought their prospective buyers with them arrived. By the time I left the property with the buyer to whom I had showed the property, there were agents and buyers lined up outside the front door waiting to go in! Today, Monday, upon checking the availability of the property, the agent representing the bank already had two offers in hand, one of which was all cash over the asking price and offers were still coming in! Why all the activity? Again, simply stated an apparent strong demand for a single family home in Irvine on a large interior lot aggressively priced at under $500,000, and a plethora of ready, willing, and able buyers–some of whom have ready cash.

A similar multiple offer situation occurred on an Irvine four bedroom former model home price in the upper $600,000 range in which there were four all cash offers in addition to several others structured with lender financing. The listing agent for the bank came back to only the four all cash offers (they didn’t even consider the ones that required financing), with a “best and final price.” The home ultimately sold above the asking price to the highest and best bidder.

What about the higher end properties–above $1,000,000? These too are receiving multiple offers, and the successful buyers are the ones that are either purchasing with all cash or those who are financing only a small portion of the overall price of the home. Buyers who are trying to negotiate off the listed price, and/or those who need conventional financing seem to be considered if the all cash buyers do not show up. But show up they do, and they are the ones that are the successful buyers/investors–at least for now.

I decided to play the interviewer at my Open House yesterday. Yes, I am one of those real estate agents who believe in holding Open Houses as one way to market and expose a home to potential buyers, and to answer questions swirling around in the minds of buyers and sellers in the Irvine neighborhoods in which we market and sell homes. Yes, It’s real life, real-time interacting with your potential home buying/selling community; “pressing the flesh,” so to speak. And to be quite honest we have actually sold quite a few of our listings and/or our collegues listings through the contacts we have made holding Open Houses. However, yesterday, I decided to ask John and Jane Doe, and Mary Q. Public the following questions:

1. On which sites do you search for properties, and

2. If you could make one change that would enhance your online home searching experience, what would that change be? And the answers were enlightening:

The over 40 demographic, named Realtor.com and Homeseekers.com as the top sites used to search for homes. The under 40 set, said they searched for homes most frequently on Redfin, Zillow, and ZipRealty. Of the group polled, I asked if anyone had used Trulia. In this particular group, no one had searched on Trulia or had even heard of this site. I found this “trulya” surprising, since this site ranks quite high on Google for home searches of all kinds. Only one person used a brand-name real estate company to search for homes, and that one person found it to be a frustrating experience first and foremost because they were asked to “register” in order to perform any home searches. As a matter of fact, all the people polled said that they would not use a real estate site that forced them to sign in or register; they would just navigate away from that site, until they landed on one which provided free access to information and home searches.The number one complaint, and the most often cited criticism of real estate sites in general was the lack of up-to-date, reliable information. What consumers were led to believe were available homes for sale, turned out to be homes that were already in escrow or sold homes. The real estate sites that provided RealtyTrac information (homes in default or REO/bank-owned properties) were cited as being completely out-of-date in many instances.

I considered a name change–oh no, not my “real” name, but my on screen real estate name. Robin4Homes just doesn’t reveal who I really am. Okay, okay, so yes, my real name is Robin, and yes, I do sell homes (ala real estate); but nowadays, one’s on screen personality can really sizzle with a dynamic screen name; I mean would people have viewed Archie Leach in the same light as they did the suave, debonair, sophisticated Cary Grant? I think not. And what about Madonna? Would she have had the same fame had she remained Louise Veronica Ciccone? Questionable, at best.

So I tossed around a few names to see what transformation might occur with a new name. The first one was Rockin’ Red Robin; certainly, sizzly–but maybe a little too sizzly; I wanted to be noticed on screen, but maybe not in that sort of way. So out went Rockin’ Red Robin, and in came Robin’s Nest–too cutsy; later it was on to Robinzhoods; I thought this one was a winner; but my partner nixed it; he thought it sounded too gansta rappy; and Round Robin too portly.

Then to complicate matters, I started a blog and had to come up with an on screen persona for the new blog; I was told not to obsess about it–to give it ten minutes max and be done with it. So I wound up with Irvine Real Estate Blogger (boooring!). But I guess it defined a certain aspect of me (I live in Irvine; I am in Real Estate, and I am a would-be real estate blogger); Still it did not define the real me, definitively, and in a way with which I was satisfied.

Fast forward to the RE Barcamp in San Francisco, the day before the Inman Connect 2008 Conference, where the superstars of the blogosphere gather to discuss blogging about real estate and the newest technologies in a free-wheeling, brainstorming sort of way. Some brilliant, creative minds thought up a great way to meet and greet other bloggers; namely, calling cards with code names that defined a superpower within each of us. Too cool! Thus we were introduced to The Striped Crusader whose superpower “emits powerful rays of inspiration,” The Legal Eagle whose superpower is “making the industry better one degree at a time,” and The Mortgage Man whose superpower is “keeping consumers safe from high interest rates,” and so on. And then my name was called out: Robin Fenchel (Real Name), dubbed “The Diva of Orange,” whose superpower is raising a UC Berkeley and Harvard tandem.” Poof! I was transformed, aloft and afloat without warning, from Robin4Homes into the Diva of Orange for a single, cloud computing moment in time. And what a time it was.

Open Houses can be a viable, valuable marketing tool under certain circumstances and in particular niche markets. Real estate is after all local, and buyers often like to check out neighborhoods and houses up close and in person without having to commit to using the services of a real estate agents in the beginning stages of their search.

Just as many buyers prefer to view homes first online, anonymously, and educate themselves before actually making contact with a real estate professional, buyers also utilize Open Houses as a way to familiarize themselves with those particular communities in which they may ultimately have an interest in purchasing a home or condo.

We have found greater success in holding Open Houses than the average statistics may indicate in our local, niche markets. We hold Open Houses regularly in and around the University of California at Irvine in the villages of the University Town Center, Quail Hill, and Turtle Ridge in Irvine where homeowners and prospective buyers stop in to find out about about the current available listings, recently sold properties, types of properties, number of bedrooms and baths, floor plans, price per square foot, and proximity to specific schools in which they are interested. They ask about the current interest rates, whether housing prices are trending up or down, and ask us about our interpretation of local real estate market conditions.

An added benefit of holding Open Houses is the increased exposure these homes receive from showings by out-of-area real estate agents, who do not have local Board MLS access and, therefore, have an easier time showing our properties.

Because the demand/need for housing is driven by the proximity to the top-rated schools, in the villages in which we specialize, many of the potential buyers come from quite a distance to view the Open Houses. These communities are not only in close proximity to U.C. Irvine, but are within the school boundaries which include the top-rated elementary schools, including Turtle Rock elementary that feed into the villages of Turtle Rock and the University Town Center in 92603 and 92612, Alderwood Basics Plus elementary located in Quail Hill (92603), Vista Verde elementary (an award-winning year-around school), within the school boundaries of Turtle Ridge (92603), Bonita Canyon elementary in Turtle Rock (92603), Rancho San Joaquin Middle school, and nationally-ranked University High school which serve all of the local Irvine neighborhoods, south of the 405 Freeway, and near the University of California at Irvine.

Parents of both prospective and currently enrolled UC Irvine students visiting the UCI campus from a distant city, or from northern or central California, or, perhaps from out-of-state, or even from outside of the country, will stop by an Open House in the University Town Center, Quail Hill, Turtle Rock, and Turtle Ridge neighborhoods. They appreciate begin able to discuss the availability of off-campus housing during their short visit and can get a good sense of the area, view the current inventory on our laptop at the Open House, and schedule an appointment at the end of the day after the Open House has concluded to see the comparable homes/condos in the area.

As a direct result of holding Open Houses, we recently opened escrow on two of our listings in which we represented both buyer and seller, and assisted buyers in the purchase of two of our colleges listings in the same neighborhood. Moreover, as a result of an Open House we held in which a buyer happened to see, the buyer’s agent contacted us, an appointment was made to take the buyer through for a second look, which ultimately resulted in the sale of the property.

The bottom line is, as real estate agents, we are facilitators–enablers who strive to bring buyers and sellers together in a successful home purchase and/or sale. When it works, it fulfills the hopes and dreams of real people in their pursuit of homeownership. It’s an enduring and an endearing experience for all parties.

So the long answer (as it turns out, longer than I had anticipated), is yes, under certain circumstances, there ought to be a place for Open Houses in a real estate agent’s marketing strategy. But it’s a qualified yes. If it works, by all means use it; if it doesn’t, lose it.

There is light at the end of the tunnel…

It began this spring with whispers and mumblings in the real estate community and blogesphere. Buyers were emerging from their winter doldrums and showing up at Open Houses–at first checking house prices; not commiting, but still demonstrating a measurable interest in real estate.

While the reports from the established media were still cast in colors of May gray, and June gloom, the tweets and twitters from the chorus of real estate agents in their respective local nests were singing a different tune and what a sweet tune it has turned out to be.

Open the curtains, raise the windows, throw open the doors, and inhale the fresh air of a changing season in the real estate market. The flowers are in full bloom and their fragrance fills the air. The birds are singing and a new day is dawning here in Irvine and in the local housing markets around Orange County.

Psst…if you haven’t heard, homes are selling and they are selling in healthy numbers. Active listings down; pending sales up; inventory is rapidly being absorbed–these positive trends continue to emerge in the Irvine, California and Orange County real estate markets.

Irvine and Orange County housing sales reported to the MLS continues to be strong. The past two weeks have seen sales in greater numbers. Inventory continues to fall by an average of about 100 listings per week, compared to increases of approximately 200 listings per week at this time last year. The current inventory in Orange County number 1600 fewer homes than at this time last year. Active listings in Orange County have fallen below 15,000, and the index of how long it would take to sell/absorb the existing inventory at the current rate of sales is at its lowest point since August of 2006. In our local Irvine housing market, we currently have a total of 839 active listings in the Multiple Listing Service. Those homes/condos reported as in Back-Up or Pending Sales (in escrow) number 272 which indicates that it would take only three months to absorb/sell the existing inventory at the current rate of sales.

Buyers have a real opportunity to realize their dream of home ownership at significantly lower prices and favorable interest rates.

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Before moving to Irvine, California, we lived in Tucson, Arizona.

Most people think of the desert as rugged and hearty, certainly not fragile and fleeting. With the temperature hovering over the century mark from April through November during the daytime, one can only imagine how difficult it is for the flora and fauna to thrive and persevere.

I am reminded of a flower that blooms only one summer night in Tucson, and closes up at sunrise the very next morning, called the Night Blooming Cereus, or Queen of the Night.

I am reminded how fortunate we are here in Irvine, California to live so close to the Upper Newport Ecological Preserve, a sanctuary for migratory birds, and other critters including ourselves.

I am reminded that Sabino Canyon–a desert oasis in Tucson’s Coronado National Forest–had as a reminder of its fragility at its entrance which read:

Leave only footsteps, and take only memories…

I usually make it a point to scan the Real Estate sections of the L.A. Times, the Orange County Register, and the New York Times at some point over the weekend. However, I overlooked an article regarding 10 zip codes in Southern California that actually experienced price appreciation in the 1st quarter of 2008 as compared with the 1st quarter of 2007. Thankfully I came across Elaine Carlson’s article in PalosVerdesSource.com entitled Hottest SoCal Zip Codes.

The numbers were based on at least 20 sales in each of the zip codes as reported by DataQuick Information Systems. In Orange County, Irvine’s zip code 92603, which encompasses the villages of Quail Hill, Turtle Rock (including Shady Canyon), and Turtle Ridge, experienced an 18.0% increase in the median sales prices for existing single family detached homes as compared to the 1st quarter of 2007, Newport Coast’s 92657 zip code had an increase of 27.4% in the median sales price, and Newport Beach’s 92663 zip code encompassing Lido Isle and Balboa Peninsula had a 66.8% in the median sales price as compared to the 1st quarter of 2007.

Why do “some markets sizzle, while others fizzle?” Proximity to the beach where demand is high and inventory is relatively low has a great deal to do with price appreciation. These coastal areas have buyers who are able to qualify for good fixed rate loans, whereas the interior part of the state had borrowers who were stretching to afford homes, many of whom fell victim to the sub-prime mortgage debacle. (See my article entitled Which Cities are on Top for Home Sellers in California).

To view the cities with the biggest losses, Click here.

The question arises time and time again: If I buy such and such property in Irvine, will my child be able to attend X elementary, middle, high school? The answer is: Don’t assume anything! If you want your child to attend a specific school within the Irvine Unified School District, the best course of action is to check, and then, double-check again!

All too often, buyers do not verify the school boundaries prior to purchasing a home. They assume that if a particular school is within a few blocks of the property they wish to purchase, then it follows that the school is within the property’s school attendance boundary. Wrong! In fact, a school can be within walking distance of the property, and still be outside the school’s designated attendance boundary.

I’ve seen real estate agents make the mistake of inputing the wrong school in the multiple listing service. In so doing, they are unwittingly misleading prospective buyers. For instance, today I had a prospective buyer e-mail me regarding whether University High School is within the attendance boundary of the high-rise condos in the 92612 zip code. This would include the airport area’s mid and high-rise condos of Watermarke, Avenue One, the Plaza, and the Marquee–all of which happen to fall within the Santa Ana Unified School District, not the Irvine Unified School District. There are some buyers (and, indeed, even some real estate agents) who are under the assumption that just because these condos are located in the city of Irvine (92612), that they necessarily fall within the Irvine Unified School District’s attendance boundaries. Not so.

One other caveat: Be sure to check the attendance boundary changes for future years. Just because a school is located in an attendance boundary for 2008 doesn’t preclude the school from a future boundary change. Again, in the airport area, the Metropolitan neighborhood used to be within the Irvine Unified School District’s boundary. However, now the attendance boundary of the Metropolitan falls within the Santa Ana Unified School District. Similarly, the neighborhood of Las Palmas, within the village of Westpark, used to be within the University High School attendance boundary. A homeowner of a Las Palmas condo wound up selling her condo and moving to the University Town Center just so her daughter would be able to attend University High School. She sold her condo because University High was removed from the attendance boundary of Las Palmas a few years ago. To her chagrin, her former neighborhood was recently re-installed and is now again within the University High School attendance boundary.

Therefore, I always recommend that if parents are bent on having their child/children attend a specific school, then the best way to verify if a particular school falls within the desired attendance boundary is to go to the Irvine Unified School District’s web site and check. This is very easy do. Scroll down to Enrollment, and then over to Assigned Neighborhood Schools. Click on this and it will bring you to an area where you can type in the address of the property, and it will display the elementary, middle, and high school attendance area for that particular address. You may also wish to click on the Irvine Unified School District’s School Boundaries. The site also provides a future map indicating boundary changes.

Currently the attendance boundaries for University High School include the villages of Quail Hill, Rancho San Joaquin, Turtle Ridge, Turtle Rock, University Park, and University Town Center.
Better to be informed than sorry!