What rising rates mean to homebuyers and how to prepare yourself

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After what seems like years of teasing us with the possibility of rising rates, the Federal Reserve finally made their move with a quarter-point jump last week. Economic conditions, led by a strong job market, triggered for the first rate rise since June 2006. The move is a sign of confidence in the economy (that’s a good thing!), albeit one that is feared to slow down economic growth (not so good!) and potentially scare off buyers who were just starting to feel OK about getting into the L.A. real estate market (bad, very bad!).

So what does that mean for homebuyers and owners? And what can you do to prepare yourself for rising rates? A lot, actually.

Accelerate your home search

Were you planning on waiting until spring to buy a new home in The Valley? You’ll have company. It’s not called the spring buying season for nothing.

But predictions that rates will continue to rise in quarter-point increments throughout the next year may make you want to change those plans. Buying a home in L.A. now at a lower rate can flat out save you money—consider that a rate that’s one point higher translates to about a 10 percent rise in your monthly payment. Not to mention the other advantages of buying a home in winter: namely, less competition and the possibility of getting a better price.

“If you’ve been on the fence about refinancing or buying a home, vacation home or rental property, now is the time to act,” said Huffington Post. Once interest rates start trending up, the borrowing costs for your real estate investment will rise.”

Huffington Post used a $200,000 loan example to illustrate the difference in payments between today’s rates and a rate that’s one point higher (A difference of $115 per month doesn’t seem like a lot. But if you wait to borrow, in one year you’ll pay an additional $1,380. Multiply that $1,380 by the 30-year term, and the delay in snaring a mortgage costs you more than $40,000.”), but let’s extrapolate that:

  • On a $400,000 loan, that’s $230 more per month, $2,760 more in one year, and more than $82,000 over 30 years.
  • On a $600,00, loan, it’ll cost you $345 additional per month, $4,140 in one year, and more than $124,000 after 30 years.

Get locked in now

If you’re playing with the idea of buying a new home, get on the phone with your lender and lock in your interest rate.

That will protect your rate for a period of time—usually 30 days, but could be up to 60—so you won’t be impacted by further rate increases that take place while you’re in escrow.

Refinance

The ability to lock in a lower interest rate than you currently have is the No. 1 reason to refinance before rates tick further upward.

“Examine the terms of your existing mortgage and calculate the damage if the rates rose two or three percent,” said Consumer Reports. “If you plan to stay in your home longer than three or four years and haven’t already refinanced into a 15- or 30-year fixed-rate mortgage, do it now.”

But there are a few other refi scenarios worth considering, according to mortgage resource HSH.com:

  • You want to get rid of your adjustable rate.
  • You want a shorter term—“If you’ve been paying down a $300,000, 30-year fixed-rate loan at 5 percent for 10 years, your balance is now $236,736. Refinancing that balance into a 15-year loan at 3.5 percent will raise your monthly payments by just $82 and shorten your loan term by five years,” they said.
  • You want to wrap a first mortgage and a home equity line into one loan.
  • You want to get rid of Private Mortgage Interest (PMI)—If you have at least 20 percent equity, you can qualify.

Pay back your home equity line of credit

Your home equity line of credit (HELOC) is perhaps most impacted by rate changes and could rise dramatically if rates continue upward—especially relevant if you consider that this first rise isn’t a standalone and could signal a pattern of rising rates. “You could be looking at a 50 to 100 percent increase in your payment,” warns Consumer Reports.

Reconsider any real estate investment trusts (REITs)

These real estate focused, high-yield mutual funds may not look so good with higher rates. It might be time to reevaluate your investments.

“There’s an inverse relationship between REIT prices and interest rates: When interest rates go up, the value of REIT funds tends to drop,” said Huffington Post.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

Winning tips for writing a winning offer

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You would think in this real estate climate that the easiest part of buying a home in Los Angeles would be submitting an offer. After all, finding a home that is the right size in the right place at the right price that somewhat matches your style (or at least doesn’t completely offend you) is usually the biggest challenge in the always-tight L.A. real estate market, right?

Not necessarily. One of the most frustrating trends I’m seeing right now: Deals getting derailed over something stupid like lack of preparation or lack of effort.

Recently, I was working with a seller on a home in the Santa Clarita Valley, and when it came time to show proof of funds—which has become typical during a home sale—the seller’s agent was…well, less than cooperative. Instead of getting us the required financial information to review, we received a screen shot of an account showing random balances and credits—no account holder information or even the name of the bank.

Whether it was game-playing or laziness, I can’t really say. But this agent definitely knew better. And the behavior created an inconvenience and a delay for the seller—one that quite nearly left the buyer out of luck.

Remember that when a Realtor writes an offer, they are painting a picture to the seller of how ready, willing, and able their client is to buy a house. That means you, as a buyer, are probably going to have to share some financial information.

It’s not enough today to just throw a number out there. You’re up against other numbers. Some may be stronger than yours, some may not, but the one that has verified financial information behind it is the one that tends to stick. Buyers will want to see that you can afford the house, that you don’t just have the money to buy the house, but that you’re financially stable overall, and that you can close on time.

MonopolyGuyHere are a few more things you can do to make sure your offer is the one chosen:

  • Be as transparent as possible—Financial abnormalities, job history issues, and credit score questions are all going to come up during the approval process. It’s best to be upfront about anything that could become problematic later on and/or take the time to improve your financial situation before starting the homebuying process.
  • Get your credit in order—If you’re not completely ready to buy, get there before you waste anyone’s time. A 3.5% down payment combined with a low credit score may get you approved, but it might not get you the place you want if you’re in a competitive market.
  • Don’t lowball—An offer that’s way too low might turn off the seller, causing them to reject it altogether instead of negotiating.
  • Be first—Coming in with a strong offer before others have had a chance to see a property can be a winning strategy.
  • Give yourself extra help—I’ve personally helped a buyer secure a home thanks to a good offer and the extra incentive of a personal letter she wrote to the seller expressing her family’s sincere desire to buy the home and make memories there. Don’t expect a letter like this to make up for a crappy offer, but it could help your good offer catapult over other good offers. Never underestimate the power of an honest emotional connection.
  • Know what to do in a multiple offer situation—When you’re up against other offers and want to make sure you come out on top, talk with your Realtor about things you can do to distinguish yourself: shorten contingency time periods, waive the home warranty, or increase your earnest money deposit.
  • Work with a respected agent—Someone who has the respect of his or her peers is far more likely to be able to get you the house you want at a fair price.

As a home seller, you’re not expected to know all the details involved in selling your home. That’s what your Realtor is for, and it underscores the importance of working with a good one.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

Why Zillow is killing the real estate industry

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Zillow is the real estate agent’s worst enemy. And it isn’t any kinder to buyers and sellers.

Harsh, right?

So is their basic home pricing structure, cleverly called “Zestimates,” which feeds the public’s need for information with blatant inaccuracies that misinform buyers and sellers, exacerbating an already widely held opinion that real estate agents are: greedy, are idiots, don’t have clients’ best interests at heart, or all of the above.

Yeah, harsh.

The growth of third-party websites like Zillow, which has reported up to 75 million unique visitors in a month(!)—far more than lesser-known cohorts Trulia and Redfin—might seem harmless. But in a business where more than 90 percent of potential clients are using the Internet for research and to build a profile for what they can afford or how they should price their home, accuracy is just slightly important. Unfortunately, accuracy and Zillow’s Zestimates go together about as well as an L.A. house and a ‘70s kitchen.

A story in the L.A Times earlier this year broke down the issue. “Shoppers, sellers and buyers routinely quote Zestimates to realty agents—and to one another—as gauges of market value. If a house for sale has a Zestimate of $350,000, a buyer might challenge the sellers’ list price of $425,000,” they said. “Or a seller might demand to know from potential listing brokers why they say a property should sell for just $595,000 when Zillow has it at $685,000.”

Zillow CEO Spencer Rascoff himself told ‘CBS This Morning’ co-host Norah O’Donnell “that nationwide Zestimates have a ‘median error rate’ of about 8%. On a $500,000 house, that would be a $40,000 disparity,” said The Times.

The Washintgton Post used 5% as a benchmark for their research based on Zillow’s earlier accuracy assertions—with, umm, questionable results.

“Not a week goes by that we don’t encounter a consumer who is fixated on a particular value for a home because that’s what Zillow says it is. Kudos to Zillow for making this kind of impression on the public—brilliant marketing. But our research shows that, on average, those ‘Zestimates’ are within 5 percent of the actual value of a home just half of the time,” they said. “Localized median error rates on Zestimates sometimes far exceed the national median, which raises the odds that sellers and buyers will have conflicts over pricing. For example, in New York County—Manhattan—the median valuation error rate is 19.9%. In Brooklyn, it’s 12.9%. In Somerset County, Md., the rate is an astounding 42%.”

The post also found discrepancies in California’s more rural counties up to 26%. And in San Francisco, “It’s 11.6%.” Based on the median home value that was $1,000,800 at the time, “a median error rate at this level translates into a price disparity of $116,093.”

Just how bad is the Zillow problem? In Inman’s recent in-depth report on the challenges facing the real estate industry, “third-party websites” was the runaway answer (at 56%) to the question, “What entities do you think are a hindrance to the real estate industry?” It was also the No. 1 answer to the question “What single entity do you think will be the biggest hindrance for the real estate industry in the coming years?

The real issue is this: Zillow isn’t just a portal for information. It’s an industry influencer—one that’s breeding mistrust in an industry that’s got enough to deal with already.

So what can be done about it? Consumer education is critical. Pointing clients toward information that explains the problem with Zillow and details why Zestimates aren’t an accurate representation of home prices is a start.

Industry participation is also key. Two Colorado MLSs just joined together to sidestep Zillow with their own public site, ColoProperty.com. That’s promising. Remains to be seen if others will follow, but, for now, the site says it gets more traffic than Zillow sites provide.

There are other issues with Zillow beside their questionable Zestimates (more on that here and here). But those are conversations for another day. I’m too busy today trying to help a client understand why his house is actually worth a good $80,000 less than Zillow says it is.

Zestimate? More like Stressedimate.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

7 Reasons Your Home Isn’t Selling

DirtyDishes

So you’ve decided you’re selling your home, and you’re excited about the change of scenery—and even more excited to make a nice little profit on your existing home. But then you put it on the market, and…nothing.

Few things stink more than waiting around for an offer to come in—especially if you’ve had a lot of showings. A home that’s not selling can mean many things. Most often, it’s that your price is just too high. But that’s not the only reason no one’s buying.

1. Functional obsolescence

A home that doesn’t represent the needs of today’s buyers—whether it only has two bedrooms or one bathroom or is missing a garage—can be a tough sell. This is often seen in older homes in The Valley, and it can be hard to get a buyer to even look at one of them if it’s lacking the basic features they need. Unfortunately, there’s really no easy fix in many cases, and sellers often find that the price they want for their home and they price they can get for their home are too far apart.

2. Closed-in floorplan

File this common issue with older homes throughout Southern California under functional obsolescence as well. Your house may have cool architecture and charming details, but the fact that it doesn’t have an open kitchen and living area can be a sticking point with buyers. A good agent should be able to give their client ideas for updating the home’s layout once they buy, but knocking down a wall and creating a more modern floorplan may fall to you if your home continues to sit on the market.

3. Your personal décor choices

You may have the best taste in the world (although, everybody thinks that, so probably not), but that doesn’t mean your choices will appeal to buyers. If your bold paint colors are turning people off, listen to your agent and paint the walls something neutral. If your teenage son’s posters and album covers plastered all over his room are keeping people from actually seeing what it looks like, take them down. Taxidermy all over the house proving to distracting? Pack it up. Or throw it out. Your choice.

When the goal is selling your home, you may have to put your taste—and your feelings—aside. Living in a “neutral zone” is temporary. Enjoying all those dead animal heads you get to proudly display in your new place is forever.

4. Dirt, grime, stains, and smells

No one wants a nasty, stinky, dirty house. Your sink full of dishes can actually kill a deal if people interpret the mess as a sign of a house that’s not well taken care of. And they will. They do. All the time.

If that sounds like you, or if the dirty dishes are only the beginning of the offenses you’re committing, it’s time to clean it, scrub it, strip it, rip it out, or, at the very least, cover it up. The faster you get it sold, the sooner you can go back to living without worrying about every crumb, spec of dust, and foul-smelling cat box every moment of the day.

5. Your closets
If you’ve struggled with the storage space in the home you’re selling, the new owner probably will too. Overstuffed closets, cabinets, and drawers might just make a buyer pass on the home.

6. A bad agent

Real estate agents are a microcosm of the general population. Some of us are Bill Gates, some of us are closer to Bill Cosby. If you have a gut feeling that you’re not getting the level of service and attention you need to get your home sold, you just might be right. If your agent is: lazy, uncommunicative, belligerent, unprofessional, rude, uninformed, or unwilling to consider your feelings or opinions, it’s probably time to get a new one.

7. Unreasonable sellers

Yeah, I’m talking to you, “eager” seller who can only allow showings every other Tuesday between 1–2pm. And you, who has a shoes-off policy for showings but clearly hasn’t vacuumed or had the carpets cleaned in a year. Or you, who has refused to fix anything the inspection uncovered—including plumbing, roofing, and electrical problems. You know what they say about being part of the problem or part of the solution. Which one are you?

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

10 Things Agents Can Do To Fix Our Bad Reputation

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I came across a Harris Poll the other day that, unfortunately, was not shocking. It listed real estate as the least prestigious profession. The Day America Told the Truth, a book by advertising mavens James Patterson and Peter Kim, had real estate at No. 13 on the list of Top 20 Sleaziest Ways to Make a Living (behind drug dealer, crime boss, TV evangelist, prostitute, and eight more questionable pursuits), so there’s that. But it was written in 1992. Is it possible our reputation has only gotten worse since then?

I don’t know about you, but I’m not OK with it.

I’d like to think most of us are committed and considerate. But clearly that isn’t an opinion shared by the gen pop. In the spirit of a few bad Realtors spoiling the whole industry and in the hope that with knowledge, understanding, coaching, and maturity, that might change, here’s my list of things we can all do better.

It’s not revolutionary. But it is necessary.

1. Don’t miss appointments

Yes, things come up. But servicing your client should be a priority. It’s as simple as that.

2. Apologize

If you happen to miss an appointment (because you had a blowout on the 405 and your phone flew out the car window as you were swerving to avoid a semi, not because you blew it off to have a massage), say you’re sorry. Sorry goes a long way. Especially when it’s sincere. If you’re not sure how to be sincere, well, you probably deserve to be ranked along with crime bosses and evangelists.

3. Be on time

Your time isn’t more important than that of your client. But if you’re habitually and egregiously late, that’s what you’re communicating. If a client feels like they are not being appreciated, they might not be a client for long.

4. Listen to your clients’ needs

Showing a client a tiny two-bedroom condo in the city when you know he needs a five-bedroom single-family house in the valley probably won’t end well. Yes, you want to make sure your client knows there are options beyond what they might have considered, but veering so far from what they’ve asked for can make them feel like you’re not paying attention. Once the trust has been compromised between you and your client, it’s hard to get it back.

5. Pay attention to your client

This isn’t the same as listening. It’s staying in touch with updates. Returning calls/texts/emails right away. Actually being present during property tours instead of being buried in your phone.The trick is to handle your client the same way you would any relationship you care about. (This may also be helpful in figuring out why your relationships don’t work out.).

6. Be responsive

It would seem like common sense to suggest that Realtors respond to showing requests or offers on their listings right away…but it’s surprising how many times that doesn’t happen.

7. Don’t be lazy with listings

Some agents may think their job is to hang a sign in the yard and wait for the offers to roll in, and while that sounds delightful, it’s not very realistic as a long-term strategy. Depending on the market, you might have to do some actual marketing of a property. Or reach out to other associates to drum up interest. You might actually have to sit a few open houses (the horror!).

8. Provide counsel

Buyers and sellers are not real estate experts, no matter how many transactions they have been a part of. They shouldn’t be setting their own sales price, negotiating their own deal, or trying to determine if a home is a good value. That’s the agent’s job. You have to be willing to do the legwork and the follow-up. You also have to be willing to have some hard conversations. Your pretty face and spiffy suits are not adequate substitutes for professional guidance.

9. Don’t make a sale at any cost

Long-term success is what we’re all here to achieve, right? Pushing a client to buy something that isn’t a good deal or isn’t right for them doesn’t serve anyone well, and most certainly won’t lead to referrals or repeat business. Same goes for encouraging a seller to take the first lowball offer just so you can be done with them.

10. Be a human

Buying or selling a home is stressful. It can also be emotional for someone who’s going through a big life change—especially if they’re selling because they have to, not because they want to. Having a little compassion goes a long way.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

Do you need to like your Realtor? No, but it helps.

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Your real estate agent is a complete ass. He’s the Donald Trump of the real estate world. Without the weird hair and the $10 billion bank account. But still.

He’s mean. Rude. Cunning. Ruthless even. Seemingly incapable of kindness or empathy or even fair play.He’s also insanely successful and working with him has always paid off for you. Literally.The morality play has concerned you before, but it’s getting more and more difficult to work with someone whom you don’t like or respect. Time to let go of the relationship and work with someone new? Or should you just get over it?

The real question is: Does your real estate agent have to be likable? Inc. thinks so.

“The fact is that the more likable you are, the better you will get along with your co-workers and others in your life. And the better you get along with others, the more successful you will be,” they said. “People want to work (and spend their lives) with people they like, and they want to avoid (sometimes at any cost) those they don’t like.”

I’ve personally found that to be true.

But I’ve also seen a whole lot of a-holery. Trump makes no apologies for opinions and actions that make others cringe. And he’s hardly alone.

When it comes to real estate, the concept of the “asshole agent” is one that is not just tolerated, but celebrated on TV (check out any episode of Million Dollar Agent in any city for proof). It’s also one that’s propagated by actual asshole agents who seem to be following a very specific route to success.

“Real-estate agents, take note: It’s better to be feared than loved,” said the Wall Street Journal in an article entitled “A Few Home-Selling Tips From Machiavelli.” Research for the article found that “brokers who score high in Machiavellian personality tests sell more real estate than their kinder, gentler colleagues…meaning Machiavellian behavior and performance were found to be highly correlated.”

Wow.

But the article also makes an important point about long-term success: “In general, anyone in real estate is likely to be dependent on repeat business. If you take a Machiavellian approach, then that would hurt your long-run prospects.”

Exactly.

After all, this business is not easy. But it is incredibly rewarding. If you don’t like helping people make a dream come true or get out of a bad financial situation or simply change their scenery, maybe you just belong in a different business.

You jerk.

Everybodylovestrippjones

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

10 Things You Must Do To Get Top Dollar For Your Home

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There’s an old saying that if a home is priced right, eventually it will sell. And, for the most part, that’s true. But sales price is only the beginning.

Buyers are picky, and when they have lots of options to choose from, you need to make sure your home is the one they remember—for the right reasons. For my clients, that means advising them on changes that will make their home memorable and saleable. Some may just need a few key fixes, others may need to be brought into this century. Either way, these tips can help them get top dollar for their home and sell quickly.

1. Clean, clean, clean.
Buyers do not want to sell your dirty dishes in the sink or your dirty laundry on the floor. You want them to remember your house, not the color of your boxer briefs.

2. Declutter. Then declutter some more.
Your knickknacks are not going to sell your home. Pare down your accessories, and, when you think you’re done, take another pass. Then box them up. That way you’ll also have a head start on your packing.

3. Address your front door.
Replacing your front door is the most important home improvement you can make, according to Remodeling magazine’s annual Cost vs. Value Report. The return on investment (ROI) is between 91 percent and 121 percent depending on whether it’s a fiberglass or steel door. But you can get a similar effect by painting your door. It’s a must for my listings.

4. Improve your curb appeal.
You know what they say about a first impression. If your home looks shabby on the outside, potential buyers may not even look inside. The drought is making it difficult for many California sellers whose lawn used to be pristine, but you can still make your yard look better by mowing if needed, raking any fallen leaves, incorporating drought-tolerant plants, and adding some colorful flowers in pots near the door.

5. Clean your carpets.
No one wants to play “identify the stain” when looking for a house. If you can’t clean it, rip it out. If you can’t afford to rip it out, cover it up. Throw rugs are cheap and can add some stylish flair where needed.

6. Fix up your kitchen.
The average major kitchen remodel for the Pacific Region (defined as California, Oregon, Washington, Alaska, and Hawaii by Remodeling Magazine) costs $62,411, and provides an 81 percent, or $50,650 return on investment. Triple those numbers for certain L.A. neighborhoods!

If you’re planning to live in the home for a few more years, that’s not a bad ROI. But not many people are going to drop that much money on a new kitchen just to get their home sold. You can get some bang for your buck by making small but impactful changes to your kitchen like:

  • Painting your cabinets—A fresh coat of white can magically transform a dated and dreary kitchen.
  • Cleaning your grout—If you’re not in a position to replace your tile countertops with quartz or another updated material, at least make sure they’re in great condition and are sparkling clean.
  • Changing out your lighting—This is one of my top tips for sellers, and one I use throughout their homes.
  • Adding hardware—It’s easy, inexpensive, and can add a modern touch to a kitchen that needs one.

7. Add neutral window coverings.
This is another change I always make when getting one of my client’s listings ready for sale. Window coverings that are too bold, too old, or too ugly can turn off a buyer.

8. Pack up your pets.
Not everyone likes dogs, even if yours is the sweetest, cutest pooch in the world. And no one wants to smell or see a cat box when they walk into the guest room. If you don’t have anyone who can watch your pets during showings, pack ‘em up in the car with you. The momentary hassle will be worth it.

9. Paint the walls…and the trim.
It’s the quickest and easiest way to make an impact in a home, and it’s something you can do yourself if you don’t want to pay a professional.

10. Get new faucets.
This simple fix can breathe new life into kitchens and bathrooms, making old sinks and vanities look updated.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

Dealing with the drought: 27 ways to make it easier

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The drought California is facing is no picnic. Especially because there are few lush green lawns left to spread out on. The most recent gut punch is a round of mandatory cutbacks that went into effect on June 1, requiring “statewide savings to average 25 percent.” Even more harsh are the possible fines involved: “Local water agencies in Southern California can fine property owners up to $500 a day if they don’t abide by the new restrictions,” said ABC7.

Ouch.

The state has ordered restrictions (L.A. DWP customers can’t wash their car without a hose that can self close and shut off or water their lawn when it’s raining). But there are lots of other actions we can take to make the cuts less painful and also become waterwise—and they don’t include illegally tapping hydrants and trucking in water.

  1. Get rid of the grass. A “low-maintenance ground cover will “require less water and little to no maintenance, but they can thrive in poor soil and keep out unwanted weeds,” said Bob Vila. Check out groundcover options here. Unfortunately, rebates that were being offered through the Metropolitan Water District of Southern California’s $350 million augmented funds are no longer available as of last week. “All the money, they said, was spoken for,” according to the L.A Times.
  2. Turf it. Artificial turf can provide the look of grass without the maintenance and some areas offer rebates and incentives. But before you go ripping out your lawn, check with your HOA, or you could end up like this guy.
  3. Don’t want to replace the lawn? Paint it green!
  4. Fix plumbing leaks. Look for excessive water in the gutters or mud puddles in your yard. If it’s an older irrigation system, you can be losing up to 75 percent of the water to leaks.
  5. Turn off the water when brushing your teeth. It can save more than 200 gallons a month. The EPA has more ideas you can teach your kids about water savings.
  6. Do the same when lathering your hands with soap.
  7. Shaving in the sink? Fill it up instead of running the water and save hundreds of gallons a month.
  8. Get a pool cover and save up to 720 gallons of water a month that are no longer being lost to evaporation.
  9. Take your dog outside! Giving him a bath in the yard that needs to be watered anyway does double duty.
  10. Replace your washing machine—the second-largest water usage in the home. Look for Energy Star™ models, which can use 35 to 50 percent less water and 50 percent less energy per load,” said h2ouse.
  11. Install an instant water heater on the kitchen sink. It’s a convenience that also saves water and energy.
  12. Run your dishwasher only when full.
  13. Even better, get a new dishwasher, which can save up to eight gallons of water per load.
  14. Get a new dryer while you’re at it. Potential water savings: 16 gallons per load!
  15. Thaw food in the fridge instead of under running water.
  16. Compost instead of running your garbage disposal.
  17. Check your showerhead. “If your shower can fill a one-gallon bucket in less than 20 seconds, replace the showerhead with a water-efficient model,” said Loudon Water.
  18. Get a new toilet. “A newer high-efficiency model can save 38 gallons a day per toilet” if yours is pre-1990, said the San Jose Mercury News.
  19. Recycle the water you use in your fish tank as fertilizer for your plants.
  20. Pull those weeds. They’re stealing water from the plants you do want.
  21. Water when it’s cool out. Many cities have already enforced watering time restrictions. Watering on days that aren’t hot and sunny can help save further.
  22. Don’t hose off your driveway; use a broom instead. Watering may not be allowed anyway, and the bonus is a great arm workout.
  23. Mulch it! You can save up to 250 gallons per month by using it around trees and other landscaping.
  24. Look for drought-tolerant plants. They hold up in the heat, save around 100 gallons of water per week, and succulents are on trend.
  25. Do your pool repairs underwater.
  26. Shorten that shower. Cutting your 10-minute shower in half can save a whopping 25 gallons.
  27. Install a drip system. It will cost a few bucks upfront but save you 120 gallons a month when watering twice a week.

Be sure to check for rebates in your area on the EPA’s WaterSense Rebate Finder page, and the Find Your Local Water Agency page. Some new appliances and water-saving items can save you money, for example, the Los Angeles County Waterworks District offers a $100 rebate on high efficiency clothes washers and weather-based sprinkler controllers.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292

Is L.A. Affordable For Homebuyers?

LASkyline

The question, “Is L.A. affordable for homebuyers?” will elicit everything from groans to guffaws depending on whom you ask. Paying a premium to live in the most gorgeous area in the world, with a backdrop of beaches and bluffs and beautiful people is what many of us just accept. It quite literally comes with the territory.

We may complain a lot about rising prices, but that doesn’t mean we’re about to pack up the car and move to the Midwest. For many of us, it’s L.A. or bust—a fact that showcases our civic pride but also leaves many buyers on the outside.

Renters Getting Squeezed

High prices that have pushed the affordability index to unreasonable levels means people are pushing the far outer limits of the acceptable debt-to-income ratio. Or they’re buying way outside of their preferred area. Or they’re just not buying at all, and dealing with rents that are also way out of reach for many people—and show no signs of capping. In fact, L.A.-area rents are some of the highest in the nation. According to the California Housing Partnership (SCPR), “You need to earn at least $33 an hour—$68,640 a year—to be able to afford the average apartment in Los Angeles County. The $33 an hour figure is based on the average L.A. County apartment rental price of $1,716 a month, from USC’s 2014 Casden Multifamily Forecast.

Their data qualifies an apartment as affordable when “you spend no more than 30 percent of your paycheck on rent.” But L.A. residents are at 47 percent, “which is the highest percentage in the nation, according to UCLA’s Ziman Center for Real Estate.”

Forty-seven percent? Yikes.

When you look at buying, there’s an even greater disparity, given the median home price in Los Angeles of $570,500, according to Trulia, and the median income in Los Angeles is “about half” of what is needed to buy, at $49,497, according to census numbers from 2009-2013, according to the SCPR.

Yep, that’s the price you pay to live near the sand. Or Sunset. Or 90210.

Millennials Feeling The Pinch

Not surprising, the group being most strongly impacted by the L.A. price crunch is millennials.

According to new data released by Zillow, “L.A. is the second-worst American city ‘Where Millennials Can Actually Afford to Buy a Home,’ said L.A. Weekly. The site says that in, Los Angeles, “Just 26 percent of homes are affordable for millennials, the smallest of any California metro and just shy of the lowest share in the nation.”

So who did we lose to? Honolulu.

Aloha-eh? San Diego was next in the un-affordability parade, just FYI.

“If you’re a 20- or early 30-something and want to buy a house in Southern California, well, good luck,” said the L.A. Times. “Nationwide, it found millennials could afford 70 percent of listings. In L.A., it was just 26 percent. In regions such as Pittsburgh, St. Louis and Buffalo, N.Y., the figure tops 80 percent. Closer to home, 53 percent of listings in the Inland Empire are affordable, twice the share in coastal Los Angeles and Orange counties.”

The study found a disparity between L.A. salaries and L.A. home prices—one that isn’t necessarily replicated in areas like San Francisco, which you might expect to rank above L.A. in terms of unaffordability—especially given the area’s home prices (San Francisco and San Jose were both near the top of Forbes’ list of Most Overprice Cities last year and San Francisco also tops their recent list of Worst Cities For Renters).

So what does that mean for buyers? It means that the cash-carrying millennials who are snapping up million-dollar homes in some of the hottest—and most quickly gentrifying—areas in L.A. are the ones who are sitting prettiest. Except, perhaps, those who are celebrating their all-cash purchase at a Honolulu luau instead of at Mozza.

Tripp Jones Real Estate for Santa Clarita and San Fernando Valleys, Call 661-733-4555 or 818-527-6292