California's fiercely competitive housing market

For months now, north state real estate agents have talked about the very low number of houses on the market and how it's created bidding wars, especially at the lower end.

On Thursday, the California Association of Realtors released results of a survey that shows this playing out across the state.

More homes in 2012 have received multiple offers than in any year since 2000.
Affordable prices and record-low interest rates are also fueling sales.

Nearly 6 of every 10 sales got an average of 4.2 offers, up from 3.5 in 2011, the CAR survey shows.

No surprise that lower-priced homes, many owned by the bank after being foreclosed, attracted more multiple offers than equity sales. Seven of 10 foreclosure and short sales got more than one offer.

In the release announcing the survey results, CAR President LeFrancis Arnold said the highly competitive market can make it tough on first-time home buyers. That's because they often are competing with investors armed with all-cash offers.

Nearly one of every three buyers in California has paid with cash this year. That's more than triple the amount it was in 2001 as demand for investment properties grows.

Foreclosure research firm RealtyTrac released data earlier this year that show speculators are getting more bullish on the north state's housing market.

There were 232 properties flipped in Shasta County in the first half of 2012, a 176 percent increase from the same six months a year ago.

By David Benda

Winter cleaning tips

The winter season brings shorter days, cooler temperatures and often, lots of guests and holiday entertaining. A deep cleaning of your space leaves your home looking great and may keep flu season at bay. Here are some ideas to freshen up your home.

1. Sanitize commonly overlooked items. Germs are most prevalent on heavily used items. Disinfect your computer keyboards, remote controls, light switches, phones, appliances, doorknobs and cabinet handles regularly.
2. Flip and rotate mattresses. This ensures the mattress will maintain its shape, comfort and resilience. Feel free to vacuum the mattress for added cleanliness.
3. Wash any bedding that was in storage. Launder winter bedding and if possible, dry outdoors to rid it of any musty odor that may have seeped in during storage.
4. Clean your chimney and flues. This should be done at least once a year and should be conducted by a professional. It is important for safety and may cut down on your heating bill.
5. Protect and clean wood and tile. Deep clean to remove any dirt or grime and reseal wood floors to protect against scratches.

Home Depot Profit Tops Estimates as Housing Market Heals

Home Depot Inc., the largest U.S. home-improvement retailer, posted third-quarter profit that topped analysts' estimates as the recovering U.S. housing market prompted customers to spend more on home repairs.

Net income climbed 1.4 percent to $947 million, or 63 cents a share, from $934 million, or 60 cents, a year earlier, the Atlanta-based company said today in a statement. Excluding some items, profit was 74 cents. The average estimate of 25 analysts surveyed by Bloomberg was 70 cents. Sales rose 4.6 percent to $18.1 billion, topping the $17.9 billion average estimate.

The U.S. housing market is healing, with new-home sales rising to the fastest pace in two years and construction starting at the fastest rate in four years. The rebound has helped sales at Home Depot locations open at least a year gain 4.2 percent, the sixth straight quarterly increase, as customers visited more often and spent more per trip.

Home Depot "did an excellent job driving its sales growth with lower promotions," John Tomlinson, an analyst at ITG Investment Research in New York, said today in an e-mail. "There is no doubt improvements in housing turnover and home prices are also positively impacting its sales trends."

Home Depot rose 3.6 percent to $63.38 at the close in New York, the biggest gain since Dec. 20. The shares have climbed 51 percent this year.

Housing Rebound

New-home sales in September climbed 5.7 percent to a 389,000 annual pace, the most since April 2010, according to the Commerce Department. Housing starts that month jumped 15 percent to the fastest rate since July 2008, a report last month showed. Beginning construction rose to an 872,000 annual rate, exceeding all forecasts in a Bloomberg survey, Commerce Department figures showed.

Americans' real estate holdings have risen in value for two straight quarters, making them worth $730 billion more than at the end of 2011, Federal Reserve data show. More than 1.3 million homeowners who had owed more than their property was worth have moved above the break-even point on their homes, according to CoreLogic of Santa Ana, California. U.S. home prices rose 4.6 percent in August from a year earlier, according to the service.

Those rising property values are bolstering household finances and spurring the consumer spending that accounts for 70 percent of the economy.

Sales this year will gain 5.2 percent, Home Depot said today. That's up from a previous projection for a 4.6 percent gain. Profit excluding the effect of closing seven stores in China will be $3.03 a share, up from a previous forecast of $2.95 and topping the $2.98 average estimate.

Written by Chris Burritt

National Geographic Best Fall Trips of 2012

For the complete list visit: www.nationalgeographic.com

1. International Balloon Fiesta in Albuquerque, NM
2. Devil’s Pool at Victoria Falls in Livingstone, Zambia
3. National Apple Harvest Festival in Arendtsville, PA
4. Great Masurian Lakes in Poland

A New Housing Boom

The long-battered housing market is finally starting to get back on its feet. But some experts believe it could soon become another housing boom.

Signs of recovery have been evident in the recent pick ups in home prices, home sales and construction. Foreclosures are also down and the Federal Reserve has acted to push mortgage rates near record lows.

But while many economists believe this emerging housing recovery will produce only slow and modest improvement in home prices, construction and jobs, others believe the rebound will be much stronger.

Barclays Capital put out a report recently forecasting that home prices, which fell by more than a third after the housing bubble burst in 2007, could be back to peak levels as soon as 2015.

"In our view, the housing market had undergone a dramatic over-correction during the prior five years, resulting in pent-up demand for housing purchases that would spark a rapid rise in housing starts," said Stephen Kim, an analyst with Barclays, in a note to clients.

In addition to what Kim sees as a big rebound in building, he's bullish on home prices, expecting rises of 5% to 7.5% a year. 

By Chris Isidore @CNNMoney

The pros and cons of purchasing a short sale property

Some buyers find themselves contemplating the purchase of a short sale, a property that sells for less than the balance its owner owes on the mortgage, despite the possible added complexities. If this is something that you are considering, please take note:

Pro: A major advantage to purchasing a short sale property is the price. Banks do not want a property to go into foreclosure, which is usually the next step if a short sale property fails to sell. Often buyers can purchase a property for under the market value.

Con: The disadvantage of buying a short sale is that it can be a very lengthy process. Short sales often take significantly longer than normal closings due to the amount of people involved in the transaction. The bank employs negotiators to get the maximum amount for a property and once the negotiator approves, a supervisor must review the package. You may wait for months while your offer is evaluated and the lender may reject your offer, even after having had the paperwork for a long period of time. If you do not have a flexible time frame, a short sale probably isn’t for you.

Recommendation: When shopping short sales, remember to work with a qualified real estate agent who has experience with short sales. Short sales can be complex, so it helps to ask about experience and success with short sales and familiarity with the process and lenders.

O.C. Inventory Reaches a Record Low

The Orange County inventory has not stopped dropping since June of last year. The inventory beat a record low established in March 2005.

The Orange County active inventory dropped to 4,886 homes, beating a low of 4,912 more than seven years ago. It is fascinating to contrast the incredibly low inventory to the height during the downturn of 17,898 homes in September 2007, more than triple today’s mark. Last year’s height occurred in June with an inventory of 11,388, and it has dropped unabated ever since.

The housing market has become a market of extremes. From the crazy days of mass appreciation, astronomical demand and low inventories from 2000 through 2005, to the Great Recession of 2006* through 2011 with unprecedented depreciation, little demand, and plenty of inventory, the housing market is either on or it is off. There is no in-between, no happy medium. It is either hot or cold, never just right.

For those real estate veterans that have been around for a while, everybody was hoping that housing would morph into a market simple to navigate, good for both buyers and sellers. Sustainable demand along with a manageable inventory would be ideal. Along came 2012 and it was time for an “about face.” If we just read the tea leaves, we would have seen it coming. The continuous drop in the inventory foreshadowed that a change was afoot.

As the inventory dropped to bottom of the barrel levels, interest rates declined to below 4%. Investors caught on first and were already entering the market towards the end of 2011, parking their cash in real estate. They intuitively knew that it was best to buy at a low and real estate was starting to show signs of reaching that low. With low rates and low prices, affordability based upon the median sales price and interest rates reached levels not seen since 1999. Savvy buyers quickly came to the realization that NOW was a great time to buy. From there, the floodgates opened up.

Experts started pointing to a bottom in the market. Warren Buffett exclaimed that he would buy a couple hundred thousand single-family homes if he had the resources to manage that kind of a portfolio. Economists started reevaluating their forecasts and 2012 was all of a sudden looking a lot rosier for housing. But, it just didn’t bottom, a housing recovery was unfolding in many market across the U.S., including Orange County and the rest of Southern California.

From here, expect news of housing appreciation through the rest of 2012. There will be a resurgence in the building industry as building permits skyrocket (inevitable since major earth grading and infrastructure is already well underway throughout the OC). With the media communicating the healing housing market and appreciation, consumer confidence will rise with the knowledge that the “average Joe’s” biggest asset, his home, is moving in the right direction. Housing is the fundamental driver to the eventual healing of the economy as a whole. It has been that way with every modern downturn. Stay tuned…

Demand: As kids heads off to school, demand starts its cyclical slowdown.

The real estate market is transitioning into the Autumn Market. Yes, autumn does not officially begin until the end of September, but it comes early for housing every year. Buyers with kids want to close by the time school begins, so with that window gone, demand starts to slow from the highs of the spring and summer. Demand, the number of new pending sales over the prior month, dropped by 2%, 81 pending sales, and now totals 3,463. That is the highest level for this time of year since I started tracking demand back in 2004, and even exceeds 2009 when the initial first time home buyer tax credit artificially stimulated demand.

Currently, demand is still very close to 2009 numbers, but a major difference is that more short sales are actually closing today compared to back then. It used to be a crapshoot as to whether or not a short sale would ever close. Today, the odds are much more favorable, systems have improved, and short sales are eventually closing.

Last year at this time there were 414 fewer pending sales, a 14% difference. Demand may drop during the Autumn Market, but expect only a slight drop since the inventory is so tight and many buyers have been unsuccessful thus far in their attempts to purchase. For the persistent buyer with a sharp enough pencil and a lot of patience, success is inevitable in time.

By Steven Thomas

Low Housing Supply Raises Concerns

Local experts fear it could keep market from making progress

Lack of housing inventory to feed consumer demand is a growing concern in the local market and statewide, a chief housing economist told local Realtors on Friday. Real estate pros fear this dynamic could keep the housing market from making progress because qualified buyers are edging each other out of slimmer pickings.

Leslie Appleton-Young, with the California Association of Realtors, said competition for homes began to heat up earlier this year in light of declining foreclosure resales and increased investor activity. The result, she said, has been increases in both sales and prices statewide, though we are still far from pre-recession peaks.

“The market is in the process … of healing,” she told local real estate pros at a housing summit held by the San Diego Association of Realtors. The event’s other keynote speakers — Gary London, with The London Group Realty Advisors, and Lawrence Yun, chief economist at the National Association of Realtors — echoed similar thoughts about inventory and the fact that California is in the middle of a tepid recovery.

Appleton-Young broke down housing inventory into three key categories, all very different from each other: equity, bank-owned and short sales.

“Equity” sales, or traditional sales, now make up almost 60 percent of total statewide home sales, up from 30 percent in January 2009, Appleton-Young’s numbers show. The share of bank-owned properties in the market has fallen from 60 percent three years ago to 20 percent now. And lastly, short sales, a process more lenders have now streamlined, are up.

This shift in the sales makeup indicates an increased demand in inventory, a higher presence of investors and a lack of distressed homes hitting the for-sale market. In other words, more potential buyers are competing for fewer homes, which can keep the market from moving forward, or at a standstill, speakers said.

London and Yun highlighted San Diego’s lack of housing construction due to an issue that’s specific to this county.

“You’re running out of land,” said Yun, who added that new-home construction has hit a 50-year low nationwide.

London said the age of traditional subdivision construction is over, pushing homebuilders toward going vertical and building in smaller batches.

The lack of inventory and the county’s population growth will help push up prices, though the escalation will not be as rapid as in pre-recession days, London said.

Written by
Lily Leung

Why you should plan multiple visits to a home before buying

For most of us, a home is usually the largest single investment of a lifetime. Such a large purchase warrants multiple visits before making a purchase and it is recommended that you stagger the times of these visits to get a comprehensive experience of the property. Here are some things to pay attention to when viewing a property.

1. Wall-to-wall windows coupled with an open floor plan may seem picturesque midday. Schedule a visit at sunset to get an idea of how light floods through the home and think about how you would ensure privacy at night. It still may be an ideal choice but it is wise to get a realistic view and calculate the cost of window treatments.
2. Visit or drive by a prospective home at different times of the day. That seemingly quiet residential street may be a noisy, highway-feeder street during morning or evening rush hour. The same may be true for the morning commute but if you only visited the property midday, you would have no idea.
3. The adjacent school may seem like a nice perk, but during school hours, the daily playground noise and extra traffic may be more than you bargained for. If you are viewing the home in the summer, ask your REALTOR® or even neighbors about what you can expect.
4. It may be nice to be within walking distance to bars and restaurants, but consider the amount of pedestrian traffic. Will late night foot traffic lead to noise or disorderly conduct? Also, remember you can always visit the local police department to get crime statistics of an area.

Good Energy Saving Investments

Planning to do some remodeling soon? Time to replace old appliances? Consider these energy efficiency suggestions when you make purchases.

Install a whole house fan

A whole house fan is permanently installed in your attic and draws cool air into your home through the windows while forcing hot air out through your attic vents. Use after sundown when the outside temperature drops below 80 degrees, and in the early morning to cool your house and help reduce your air conditioning use. (Save: up to 5 percent)

Install window shading

Install patio covers, awnings, and solar window screens to shade your home from the sun. For additional future savings, use strategically planted trees, shrubs and vines to shade your home. (Save: 5 percent)

Solar control window films applied to existing glass in windows and doors is an effective method to reduce peak demand during hot months and conserve energy anytime air conditioning might be required. In addition to the energy management benefits, the use of these films can also reduce exposure to ultraviolet radiation and reduce glare. Vist the International Window Film Association for more information. (save 5-10 percent)

Invest in a new air-conditioning unit

If your air conditioner is on the way out, buy an ENERGY STAR® air conditioner. (Save: up to 10 percent)

Seal your ducts

Leaking ductwork accounts for 25 percent of cooling costs in an average home, so have your ducts tested and have any leaks or restrictions repaired by a qualified contractor. Note: duct cleaning is not the same as duct sealing. As of October 1, 2005, if you install a new central air conditioner or furnace, your ducts will have to be inspected. (Save: 10 -20 percent)

Replace your refrigerator with an ENERGY STAR® model

Refrigerators with a top or bottom freezer design can save you an additional 2-3% on your bill compared to a side-by-side design. (Save: 10 percent)

Increase attic insulation

If existing insulation level is R-19 or less, consider insulating your attic to at least R-30. (Save: 10 percent)

Install ENERGY STAR® windows

If your windows are due for replacement, ENERGY STAR® windows can make your house more comfortable year-round. (Save: up to 10 percent)

Check out the "Flex Your Power" website at:
www.fypower.com

First things to do after buying a new home

You closed on your new property. The boxes are off of the moving truck, the furniture is in the right rooms and you are wondering what to do first. Here is a checklist of important tasks that are high priority.

1. Test the smoke and carbon monoxide detectors. Install new alarms or change the batteries if necessary.
2. Establish an escape plan and safe meeting place with your family in the event of a fire.
3. Make sure you know where the main water, gas and electrical shutoff valves are, in case of an emergency such as a burst pipe or gas leak.
4. Determine which outlets serve which circuits and then label the breakers.
5. Change the alarm system code, garage code, and any other password-sensitive devices.
6. Change all of the locks and make a few sets of spare keys.
7. Update your car insurance, driver's license and voter registration to reflect your change of address.
8. Have all your mail and magazine subscriptions forwarded to your new address. Keep a close eye on your bank accounts and credit cards, because during a move you are especially susceptible to identity theft if mail is not delivered to your current address.
9. Unpack any and all medication that may be needed. Also, make sure you have a first aid kit readily available and a fire extinguisher in the kitchen pantry.
10. Add any child locks that are necessary, on toilets, kitchen appliances, medicine cabinets, and any doors that lead outside. Do not forget to place child safety gates and safety plugs in outlets if you have small children.

Finally, It Is Time to Buy a House

Warren Buffett famously once said: "Be fearful when others are greedy, be greedy when others are fearful."

And if you're not instinctively scared of the housing market, then global warming, saturated fat, running with scissors and the bogeyman probably aren't keeping you awake at night, either.

The fact that everyone is scared to dabble in-much less commit to-housing makes it a close-to-perfect investment based on Mr. Buffett's principle. But buying real estate is a good long-term investment for many more reasons, some of which have only become apparent in recent weeks.

The most striking: Housing prices rose sharply from April to May. The S&P/Case-Shiller Index rose 2.2% in 20 of the nation's big cities. Prices shot up more than 3% in Chicago, Atlanta, San Francisco and Minneapolis. Even Detroit's housing market scored a gain, inching up by 0.4%.

Nationally, the increase was the first in seven months. More importantly, the increase matched other data and empirical evidence this spring that foreclosures slowed and inventories were shrinking. Simple economics suggests that as the supply of distressed property slows, buyers will be forced into higher-price properties.

In addition, interest rates on 30-year fixed mortgages have tumbled below 3.5%. For those who can get credit, these aren't just historically low rates; they are one-sided deals tilted toward borrowers.

Other good signs: Housing starts rose 6.9% in June. Home-building stocks are on the rise, with the Philadelphia Housing Sector Index up 27% so far this year. And for those who can invest in property, rents continue their ascent. Prices are at a 10-year high, with the median unit renting for $710 a month. Real-estate website Trulia found that it is cheaper to buy than rent in each of the nation's 100 biggest metropolitan areas.

In other words, if you can buy a home today, you can save the difference it would cost you to rent even if you stay in the home just five years. If you can buy a property and rent it, it is almost certain that the rent will cover the cost of the financing-and the property will appreciate.

Here's where the fear comes in. From 30% to 50% of existing mortgages in the U.S. market are underwater, depending on the estimate. That means many borrowers are trapped in their homes and loans. They either can keep paying and hope prices will improve or walk away, putting downward pressure on home prices.

Foreclosure rates have leveled off, but market analysts believe an increase is likely.

Here's why. Since the financial crisis, 3.7 million homes have been foreclosed on, but an additional 1.4 million remain in the national foreclosure inventory, according to CoreLogic, a real-estate research firm.

Finally, a housing recovery won't happen, or could be snuffed out, by a rotten economy. There's never been significant growth in housing with high unemployment. And as Dow Jones's Kathleen Madigan noted, "Potential buyers must feel secure with their job prospects before they commit to long-term mortgages. Higher loan standards mean banks want to see an applicant's solid income history before lending."

There is plenty to be afraid of when it comes to home buying. But in the current investing climate, housing presents an attractive long-term investment that should hold steady or even have upside surprise in the short term.

Fixed-income yields have fallen to historic lows, and the stock market has traded in a range, rising and falling skittishly on jobs, growth data and the news from Europe.

Recently, I was forced to choose between renting and buying. I decided to buy because it offered immediate monthly savings compared to renting, not to mention a mortgage-interest deduction.

So this is at least one case where I'm putting my money where my keyboard is.

Mr. Buffett would remind us that investments of any kind are not without risk. Each should be considered with the investor's time horizon and appetites. But he also has acknowledged that real estate is especially attractive when financing is cheap, there is pent-up demand and prices have been driven down by a spooked market. Put another way, it's time to be greedy.

By DAVID WEIDNER

Keep your pets safe this summer with these tips

Enjoy the warm summer months and ensure the safety of your pets with these seasonal safety tips.

1. Never leave an animal in a parked car, even with the windows cracked. A car can heat to extreme temperatures in a few short minutes, causing heat stroke and even death.
2. If you run with your pet, consider starting your routine earlier in the morning or later in the evening to avoid peak temperatures, or leave your running buddy at home in the air conditioning so they don’t overexert themselves.
3. Always carry extra water. Just like humans, pets may need more liquids in warmer temperatures.
4. Be aware of any harmful chemicals that are frequently used in the summer months. Avoid pest-treated areas and be cautious when using anti-freeze (which can be fatal to pets).
5. As your pet sheds its undercoat, brush and groom accordingly. Perhaps a summer trim is necessary to keep them comfortable.
6. Provide ample shade for your pet or leave them in the air conditioning.
7. Always leash your pet when in an unfenced or unfamiliar outdoor area. This will keep them safe from other animals and allow you to supervise them properly.

What to look for during final walkthrough

The final walkthrough provides buyers an opportunity to confirm the completion of any repairs the sellers agreed to and ensure the property is in the same condition it was when their offer was accepted. New owners should pay close attention to detail to avoid costly oversights. Here is a checklist to guide you through the final walkthrough..

1. Confirm any items such as appliances, window treatments, or furniture that were included in the sale are present and in working order.
   
2. Flush all toilets.
   
3. Open and close all windows and make sure screens and storm windows are present.
   
4. Run the dishwasher and test every appliance.
   
5. Test the heating and air conditioning.
   
6. Run every faucet (tubs, showers, sinks) to ensure proper drainage and look for leaks.
   
7. Check the walls for any holes or damage (especially directly behind doors where a doorknob may meet the wall).
   
8. Run ceiling and exhaust fans, garbage disposal and garbage compactor.
   
9. Turn on every light fixture.
   
10. Verify that remote controls (like garage doors) have been left by the previous owners and are operational.
    
11. Test the alarm system and verify that a manual is present to instruct you on how to change the code.
    
12. Run the spa/hot tub/pool to ensure functionality.
    
13. Inspect the floors, railings, ceilings and steps for any damage that may have occurred during the move. Check the railings for stability.
    
14. Make sure the sprinklers work and the outdoor areas are satisfactory.
    
15. Confirm all belongings and debris have been removed from the property.

Tips before you move

Your property is sold and you are preparing to move. As you leave, try and keep the new owners in mind. Here are a few tips that are mutually beneficial to you and the new owners.

1. Notify your creditors and magazine subscriptions of your new address so you don’t miss an issue or bill. Just in case, you may want to leave a forwarding address to the new owners for any subsequent mail addressed to you.
2. Contact your utility companies (electric, water, gas, water, cable, telephone and internet) two weeks before you move and set an exact date to cut off service. Have your account information ready when you call. It would be courteous to leave the new owners a list of providers to simplify their transition.
3. Update your driver’s license, car registration and voter registration within a month of the move. Consider leaving information such as your property’s designated voting zone for the new owners.
4. Whether you clean your property yourself or hire professionals, leave it clean and free of debris. Remember, this is an exciting time for the new owners and a positive last impression goes a long way.
5. Alert pool cleaners, garbage pickup, landscapers and any other companies that perform frequent maintenance of your home of your impending move. Give their contact information to the new owners.
6. Leave your house keys, garage and/or alarm codes in addition to any appliance manuals for the new owners.
7. Instead of discarding replacement tile or paint, leave these items for the new owners.

CNN America's best run cities

24/7 Wall Street reviewed local economies, fiscal discipline and standard of living of the 100 largest cities by population to determine the best-run cities.

1. Virginia Beach, VA
2. Irvine, CA
3. Madison, WI

For the complete list visit msn.com

Tips for planning your summer travel on a budget

Plan that summer vacation without breaking the bank with these travel tips.

1. Research. Compare hotel and flight prices, call and ask about any unlisted discounts.
2. Be flexible. The most expensive days to fly are Mondays and Fridays. Plan your trip on the off days, and consider connecting flights instead of direct, or early flights.
3. Brave the elements. Campgrounds are inexpensive and because you often cook your own food, it doubles your savings.
4. Breakfast included. Make sure breakfast is included in the hotel rate.
5. Eat in. Cook dinner or have a picnic. When you do eat out, lunch is less expensive than dinner and drink water instead of soft drinks or liquor.
6. Use plastic. Avoid ATM fees by selecting cash back when making debit purchases.
7. Save at the pump. Utilize phone apps that list gas prices in the area.
8. Matinees. Hit up the movies during the day for cheaper admission.
9. Museums and parks. Often museums offer free admission.
10. Coupons. Scan the Internet for discounts on attractions in and around your destination.

Avoid these common mistakes when buying a home

Home buying can be a frustrating experience, but choosing a competent real estate agent to guide you through the process will likely save you time and money. Here are some tips to avoid costly mistakes.

1. Get pre-approved BEFORE you start your home search. Pre-approval will give you a realistic price point when viewing potential homes and puts you in a better position to make a serious offer.
2. Research the neighborhood. Learn about crime statistics, schools and amenities within your potential town.
3. Look beyond the décor. Focus on the structure itself, square footage and layout. Look beyond the taste of the current homeowner, and remember you are buying the actual house.
4. Never skip the inspection. Your home is likely the biggest investment you will ever make, a home inspection is necessary to ensure it is a sound structure or at the very least, make you aware of any defects.
5. Give yourself an out. Make sure there are contingencies (such as financing or inspection) in the contract so you can back out of the deal and recoup your deposit.
6. Don’t buy the most expensive house on the block. The lower home values around your property will negatively affect your property's value.
7. Keep resale value in mind. It may be difficult to envision selling a home that you have yet to live in, but remember to consider long-term property value, location and overall mass appeal, when viewing a potential home.

Steps to make your offer more desirable than other bids

Even in a buyer's market, there are often multiple offers on a property. This can be a stressful and frustrating time for perspective buyers, and they should rely on their professional real estate agent to guide them through the process. The sellers evaluate the offers and decide which to accept. Here are some tips to put your offer above the competition.

• Money talks - A cash offer is a serious contender with any property.
• Pre-approved guarantee - Let the sellers know you are qualified by submitting your loan pre-approval letter from the lender. A pre-approval letter from the lender confirms your employment, source of your down payment, and other aspects of your financial circumstances. Although obtaining the approval is more involved than a pre-qualification letter, it carries more weight. A strictly cash offer is a serious contender with any property.
• Don't underestimate the power of a down payment - Increase your down payment, it tells the seller you are a serious buyer. Obviously, the highest offer appeals the most to sellers. If the price is uncharacteristically low to encourage multiple offers, have your agent evaluate the comps in the area to decide on a reasonable offer.
• Play nice - Find out what the sellers want and be flexible. Cater to their desired closing date or waive minimal repairs. Offer to pay closing costs and don’t ask for personal items in the home.
• No strings - Remove contingencies. The buyer with an offer that is not contingent upon sale of another property will more attractive to sellers.

Gardening mistakes to avoid

Whether you are a garden novice or a seasoned green thumb expert, avoid common gardening mistakes with these tips.

1. Pay attention to your property. Observe what areas receive the most sunlight and if there are areas that are often shaded throughout the day. Is there an area that collects an excess of water?
2. Read care instructions on trees, shrubs and plants. Learn and adhere to proper spacing instructions. Remember, spacing may seem excessive at first, but as plants grow and flourish they will increase in size and require adequate space.
3. Take pictures of your space and bring them to your local nursery with your notes and observations of sun exposure. The experts may have some advice and ideas for what will thrive and complement your yard.
4. Install an irrigation system in your yard or be vigilant about watering plant roots according to necessary specifications. This is especially important in the early stages to ensure the plants take root.
5. Landscaping and upkeep can be time consuming and expensive. Choose plant life that will not break your budget, this may entail landscaping your space in stages.

Tips for buying and selling homes at the same time

When you are buying a property while selling a property your real estate agent is more important than ever. A qualified and competent agent should be able to give you an accurate estimation of the price your current property may trade for, which is crucial if the sale of the property is contingent on the purchase of another.

Follow the same basic rules when selling your home: get organized by disposing or donating unused items, stage your property, and pack anything you don’t need on a daily basis in preparation for a move. Get a home inspection and make any necessary repairs for your potential buyers and a pre-approval letter to give to sellers of a property you may be interested in. Any proactive and preventative steps you complete will expedite both the home selling and buying process.

When listing your home be realistic with potential offers and ask for a closing date that fits your schedule. Perhaps, if the property you are purchasing is contingent on the sale of your current property, you can ask your buyers for an early closing date. If you have yet to find a property to purchase, you may ask for a later closing date so you won’t have to rent in the interim. No matter what your circumstances are, organization, pre-planning, in-depth knowledge of your finances, coupled with a skilled and experienced real estate professional, are vital aspects to the process.

SOME GOOD NEWS AT LAST AS OUR LOCAL ECONOMY, INCLUDING REAL ESTATE, APPEARS TO TURN THE CORNER

Hang on to your hats for this month's column because there is going to be a lot of information to absorb, nearly all of it positive!  Many reports have emerged as we began 2012 that would seem to indicate that the economy is, in fact, getting better.  Last month we quoted an economist that said the economy would improve, but that it wouldn't "feel like it did."  Well guess what?  It is noticeable.  Jonathan Lansner, who has been particularly pessimistic, in general and specifically to real estate, has written several recent articles that have been...well, encouraging.  National job stats say we added 243,000 jobs in January, and unemployment dove to a 2 year low of 8.3%.  Orange County, according to Lansner, added 40,000 in December.  That's the largest increase in Orange County, "working folks since January 2001 -- yes, 11 years ago."  The stock market had its best rally in over 4 years, returning to pre 2008 levels and has seemingly stabilized and is inching slightly upward.  What other intrinsic factors have led to everyone "feeling better?"  There isn't enough space in this newsletter to deconstruct all the elements of this now slow but steady recovery.  However, let's hone in on the real estate side.  First of all, interest rates... The fed's decision to keep them low through 2014 was met with a positive rally on Wall Street.  Buyers are willing and able to buy.  In fact, there are inventory issues, as in, not enough product to go around.  A seeming paradox is prices dipping slightly even with increasing demand.  Wild stuff.  But if a property is properly priced, expect multiple offers if you're a seller, and increased demand if you're a buyer.  Obviously there are exceptions to this depending on condition and location of the properties.  California added more construction jobs than any other state in the country for the past year.  Construction is a very important indicator of recovery for California.  Generally speaking, the first sign of recovery is car sales, check mark here, as last year was a banner year, particularly for Detroit.  After cars come houses, and new ones are a part of that.  There were only 302,000 new homes sold in the US in 2011, according to the Commerce Department.  And that was the worst year since 1963.  So construction coming back in California... Awesome!

WHAT ARE INVESTORS, BANKS, AND MEDIA SAYING ABOUT HOUSING?

Warren Buffett, the greatest investor of the last century privately has told the people closest to him that, “buying a home right now will be the best opportunity in their lifetime."  Here are some other quotes:  Washington Post -- Housing Market and Economy Showing Encouraging Signs... The Wall Street Journal -- From Bottom Up, Sign of Housing Recovery... USA Today -- Housing Outlook is More Upbeat... Freddie Mac -- With the New Year comes a sense of cautious optimism.  There are some positive signs in the job market and consumer confidence; housing is starting to raise hopes for continued gradual economic recovery... Fannie Mae -- The housing sector will likely take incremental steps forward in 2012.

WHAT WERE THE ACTUAL NUMBERS?

The numbers for December (the last complete month available) are as follows:  The total number of sales was 2,572.  That was a 12% increase in volume over November but still 6% down from December 2010.  There were 1,621 single-family resale, 750 condos and 201 new homes sold.  1,066 of the 1,621 were equity sales and the rest were distressed, either short sales or bank owned properties.  Condos were split 50/50 equity to distressed.  There were 1,019 Notices of Default (a 22% decline from the previous year) and 535 foreclosures trustee sales.  Of those, 382 went back to the banks and the rest sold to investors who attended the auctions.  A more interesting number is the 1,700 Notices of Trustee Sale recordings.  Conceivably, all these should go to auction.  And yet that number is few than 600.  Where are the other 1,100 preforeclosures?  The bottom line?  Short sales.  The banks would far rather sell short, than foreclose, for many reasons.  If a person is in a distressed property in the process of foreclosure, they likely can get a postponement and sell the property short.  The average monthly payment has decreased to $1,948, thanks to low interest rates, a 5% decrease from the previous year.

5 TRENDS TO EXPECT FOR 2012

According to bloggers at KCM Blog we can watch these trends emerge: 1.) Buyers will return -  We're already seeing it as housing supply dips below 5 months (6 months inventory is considered a neutral market).  2.) Foreclosures will increase - Yeah, maybe, but this newsletters say the banks will defer more to short sales.  3) Prices will soften - This was covered already and is more applicable to other parts of the country that don't have the demand and population of So Cal.  Expect more stability than not, unless you are in outlying areas such as Victorville, Hemet, Sun City, Palm Springs, etc.  4.) Short sales increase - The appropriate response to this is... !!!  5)  This last trend isn't from KCM, but is more local fodder, namely inbound moves by the three major van lines jumped by 6% the past year.  Although a state by state analysis roaming the internet put California in neutral as far as migration goes, the moving statistics don't lie.  Allied, Atlas, and United all reported a 6% increase.  That's sizeable.  This column will end on this note of optimism; there are a lot of positive indicators, statistics, and trends on which to hang your positive outlook.  But an even more organic way of testing is people's attitudes, parking lots at malls and restaurants, durable goods sales and traffic.  All of these are moving in an upward direction, so as our cousins in England always say, "Keep Calm, and Carry On."  See you next month.

WHAT WILL 2012 BRING FOR SOUTHERN CALIFORNIA REAL ESTATE?

Well, gee, let me get out my crystal ball and take a look... No it isn't meant to be a completely flippant statement, but at this point, everyone is guessing, if they're honest about it. But we can make some pretty good calculations, and estimations based on what's actually happened and inventories. First of all, you must remember that home ownership is about a whole lot more than a cash investment. Yes, it's a hedge against inflation (more on that below), and yes, it's the only investment where you can leverage your cash on such a large transaction. Those points alone should make real estate attractive. But houses were never meant to be ATM's, as many have sadly discovered, and they were not meant to be flipped as fluently as trading stocks, which still others have discovered. But for the long term buy and hold mentality, it's hard to beat real estate. And, that philosophy was just discussed by 3 economists in the New York Times in the December 31st Business section. But home ownership is much, much, more. It is where you raise your family, it is your sanctuary, and it is a quality of life embedded in your investment. But maybe most importantly, it's a way to protect your housing dollar from ever rising again...EVER. To find out what next year will look like? Read the whole newsletter, and you should get a pretty good idea. A summary statement might be, look for the beginnings of the turnaround, for prices to bottom out by 2nd quarter, interest rates to stay killer for at least 6 months, and the overall economy to do its part, as it's projected to grow about 4% this year (last year was approximately 2.7%).

WHERE WILL HOUSING PRICES GO THIS SPRING?

This column is not about to make serious predictions, but there are some indicators worth noting. First of all, the slough off of foreclosures last year due to moratoriums and fraudulent robo signing issues should be off the radar and allow foreclosures to ramp back up. That should mean more competition with the short and equity seller, as well as some pent up listing activity of people who didn't want to list during the holidays. The first and second quarter is always when you see the most listing activity. Following are 4 brief statements by various entities about spring pricing. Zillow believes we not see a bottom in prices until the first quarter of 2012. Standard and Poor thinks prices will drop 5% in the next few months. JP Morgan Chase believes prices will depreciate 6% to 7% over the next 6 months. Barclays says prices will fall 7% by the end of the first quarter of 2012. One thing everyone seems to be in agreement on: housing prices will bottom out by mid-2012 and then stay flat, bringing this down market to an end. A long recovery may be in the offing, but it will be hard for buyers to stay on the sidelines with current pricing and interest rates. Don't be fooled by a house that MAY decline another 2%-3%, but be stuck with a higher interest rate on the loan that more than eradicates any savings on the housing price.

WHERE IS THE SILVER LINING?

The silver lining in real estate is always the future: because the future is where the pent up demand is heading. If you think this overly optimistic, think about the following...
Trulia conducted a survey with Generation "Y", trying to determine future buying trends. One of the questions asked was whether or not they believed in home ownership as part of the American Dream. A staggering 65% said "Yes!" In fact, it was integral to their future plans for family and investment. So where are they? Many are living at home, saving money, and waiting. In fact, the number of young people living with parents in 2003 was approximately 4 million. By 2007 that number had increased to 4.7 million. This year that number is 5.9 million. That's a lot of people who intend to buy, when you figure out 65% of that number. That doesn't include move up buyers of Generations "X" and "Y" who are already in the market. And it doesn't consider the retiring of the "Boomers" and the transfer of wealth. As this year progresses, there will likely be ups and downs. But we planning for an optimistic year ahead. Why not?