Multifamily housing in transition

The condo and townhome markets, looked upon as the redeeming grace to single-family home ownership when pre-bubble housing prices were smoking hot, is beginning to come into its own again in Inland Southern California.

Condos had taken a back seat when Wall Street investors, squeezed-out buyers, second-home hunters and bargain shoppers looking to augment low-earning retirement portfolios snatched up a glut of houses in distress.

Now, with single-family home price appreciation in Riverside and San Bernardino counties marching into 2014 with year-to-year gains of 20 to 30 percent, Inland homebuyers are gravitating toward condo and townhouse sales in bigger numbers.

Condominium and townhouse sales in key multi-family markets - Fontana, Ontario, Rancho Cucamonga, San Bernardino, Moreno Valley, Murrieta, Perris, Temecula, Chino, Corona and Riverside - have risen 2.7 percent during the first six months of 2013, from a near standstill position in 2012.

The gain translates to an increase of only 31 sales to 1,178 units. But it comes at a time inventory is tightly crimped.

For Riverside and San Bernardino counties combined, existing condo sales are up 9.2 percent January through October, said Andrew LePage, analyst for San Diego-based DataQuick.

The 5,953 sales haven't hit that mark since 2005, when 8,762 sales were recorded over the same 10-month period.

"We are at the very beginning of a new trend," Steve Johnson, regional director for real estate research firm Metrostudy, said. "There was so little attached product built in the last seven years, this is a logical next step."

TRENDING UP

Real estate watchers agree condo and town-home sales could begin to play a more prominent role in real estate in 2014.

"If we don't see another debacle in Washington, D.C., early in the year, the economic recovery stays on track and mortgage rates remain relatively low, it's likely single-family home prices will increase," LePage said. "With those prices on the rise, I think we'll see relatively healthy condo sales because some people will be priced out of the single-family home market."

October sales numbers point to a tipping point.

Across Southern California, condo sales in October were up 3.3 percent while all home sales took a 4.4 percent tumble.

"Condos are an attractive product for the Gen-X and Gen-Y generation, the between 20- to 34-year-olds who want to celebrate life, devote more time to recreation and education and not be tied down to their residence," Johnson said. "They want a lock-and-leave lifestyle."

The pent-up factor for families or young adults who have been cooped up in a parents' home or shared living with others also comes into play.

With employment rising in core cities, Johnson say he is already seeing movement in urbanized, densely populated areas and key commuter corridors.

KEY PROJECTS

DR Horton's Pacific Trails in Rancho Cucamonga, Lennar's project in the College Park area of Chino and a second project built by Standard Pacific have performed well, Johnson said. In Riverside County, the BelVista multi-family home development in Temecula has been described by senior sales manager Diane Rogers as the perfect storm.

Designed to accommodate 210 total units, Rogers said 144 are already sold. The units that she says appeals to workers in San Diego, including military or civilian workers at Camp Pendleton, as well as the empty nesters.

"We are three-quarters sold out," she said of BelVista by Woodside Homes, which opened at prices beginning at $187,990 in April 2011. Today, prices begin in the range of $245,000 to $297,000, she said.

With Woodside proposing a second condo development in Temecula, she said: "We see the rental and condo component as the next wave in California."

With continued population growth, and household growth, along with a group of people today who do not trust the single-family, detached housing market as an investment tool, this is the alternative.

Rising rent has also been altering the landscape.

Beacon Economics, in a recent report, said buyers of existing single-family homes would pay $983 per month for housing costs in San Bernardino County, while a homebuyer in Riverside County would pay $1,260 per month.

ASSOCIATION VIEW

Leslie Appleton-Young, chief economist with California Association of Realtors, said in a recent 2014 forecast the move to multi-family makes sense when it begins to cost $3,500 a month to rent a 2-bedroom unit in Los Angeles. "With a 900-square foot apartment costing that much money, you begin to look at housing in a very different way."

For decades, condos have been the first foothold in the market for first-time buyers, LePage said.

Johnson says the sparse detached housing inventory has driven investment in existing condos, too. "There's demand for it, especially with vacancy rates running at about 6 percent," he said.

With some forecasters projecting a repeat performance on single-family price gains in 2014, the move to a product that remains affordable may already be pushing up condo prices.

The median sale price in October for existing condos grew 13.6 percent in Riverside County and 22 percent in San Bernardino County in the second quarter of 2013 from the same quarter in 2012.

"People could be very disappointed at how much prices go up over the next year for detached houses," Rogers said. "Builders aren't going to deliver homes because they are running out of land in close-in locations."

Lot sizes are shrinking. With the cost of materials and labor going up, Johnson foresees double digit price gains for condos and town homes in 2014.

"In the Inland region, attached housing comes into play when detached housing becomes very expensive."

RISING PRICES

Price growth has been highest in multifamily communities with a large population of retires, students and low-income wage earners.

Prices on condos in Rancho Cucamonga, Corona, Murrieta, Ontario and Riverside ranged from $137,000 to $218,000 over the first six months of 2013.

With metro areas beginning to report traction in the job market, Rogers said she thinks this will be a market that grows over the next several years.

LePage generally sees an upward trend on both price and sales in 2014

LePage said rhetorically, before adding the view that housing prices appreciated so dramatically, a repeat may not come in 2014. Inventory is rising, too, and fewer homes are underwater. That might soften condo sales, too.

For now, LePage said 2014 could be another year of surprises. "I could be easily wrong if the economy is building more steam than we realize now."

Written by Debra Gruszecki

5 things to know about home security systems

New technology means that you have many more options for boosting your home security. You can use a variety of home protection services, a mobile phone app, or even a low-tech solution such as an automated dimmer switch.

1. New players mean fresh options

With cable and Internet providers now offering security systems, the industry is changing. Many of these firms sell simple install-it-yourself services that eliminate the usual upfront fee of $1,000 or so.

Prices also vary based on whether the provider levies an equipment charge, the level of monitoring, and more, so total all costs before you buy, says Kevin Brasler of rating site Consumers' Checkbook.

In the first year, expect to pay between $250 and $1,500.

2. Your phone can help keep you safe

A basic security system (alarm, control panel, and series of motion sensors) costs about $20 to $30 a month, but many companies now offer a mobile app for a few dollars more.

Michelle Schenker of security tip website ASecureLife.com, recommends springing for the app, which allows you to use your smartphone or tablet to arm your system, see alerts, and turn off false alarms, even when you're far from home.

3. Someone must call the cops

With mobile tracking tools taking off, some firms do not offer monitoring services, which alert the police when an alarm is triggered. Yes, going with a non-monitoring option will save you $10 to $15 a month.

Still, Robert Siciliano of BestHomeSecurityCompanys.com, which rates security systems, advises against it: "You want that call made to protect you."

4. Customer service is the key

Many companies use similar technology, so it's service -- say, how quickly they fix faulty systems and respond to calls -- that makes firms stand out, Brasler says.

Before you choose a provider, check its reviews on sites like Angie's List (subscriptions are $3 a month) and Yelp. Keep in mind that national firms, such as ADT, "are only as good as the dealer in your area," says Schenker. And since break-ins don't always happen during business hours, look for 24/7 support.

5. The pros aren't your only choice

If you're among the 80% of homeowners without a security service, there are steps you can take to help fend off break-ins.

Trim any shrubbery that could shelter someone trying to get in through a window. Security company stickers, often sold on eBay, could dissuade a potential intruder, says Siciliano.

Thieves typically look for vacant homes, so when you're out, set an automated dimmer switch ($40 to $75) to turn on lights at odd times.

10 Reasons to List Your Home During the Holidays

1. People who look for a home during the holidays are more serious buyers.
2. Serious buyers have fewer houses to choose from during the holidays, so you have less competition.
3. Houses "show better" when decorated for the holidays.
4. Buyers are more emotional during the holidays.
5. Buyers have more time to look for a home during the holidays.
6. Many people want to buy before the end of the year for tax reasons.
7. January is traditionally the month for transfers. Transfers can't wait until spring to buy. You must be on the market to capture the market.
8. You may still restrict showing during your personal family events.
9. You can sell now, but specify a delayed closing or extended occupancy until early next year if you so desire.
10. By selling now you have an opportunity to buy during the spring, when many houses are on the market.

Bottom Line? By listing now, you may have fewer actual showings, but more qualified and motivated buyers.

The Reason? You have less competition, resulting in a quicker sale and a better price for you.

Earning RAVE Reviews in Tough Situations

Homebuying in Fall: Keys to Negotiating the Autumn Housing Market

So, you're finally off the fence and ready to buy a home before prices -- and mortgage rates -- rise any further. Here's what you need to know about jumping into the market at this time of year.

Know Your Market: The bottom line is that different markets behave differently during the fall. According to Zillow's August Real Estate Market Reports, national home values rose 0.4 percent from July, marking the third consecutive month in which monthly home values rose more slowly than the month prior. However, markets in California, Las Vegas and Minneapolis are still seeing an extremely brisk pace of home value appreciation (2 percent or higher). As we exit 2013's selling season, we will start to see a slowdown in home value appreciation.
 

Selection Is Limited: Many frustrated sellers who weren't able to unload their properties during the busy peak spring/summer buying season may take their homes off the market, particularly as the holidays approach and the action comes to a screeching halt. This means you can expect the selection to be even more limited than it currently is in some markets.
 

There's Room to Negotiate: Was there a home you saw and loved a few months ago? Is it still on the market? If it hasn't sold after one of the hottest real estate summers since the economic downturn, you likely have room to negotiate. While some buyers will pull their homes off the market, others who have been holding out for the best possible price may now be ready to come down. While some homeowners are determined to get a set price, others may simply want out at this juncture.
 

Check Maintenance Areas: Fall is the ideal time to check things such as gutter drainage and the general upkeep of the yard. How does everything look? Does anything need repair? Visit the home on a rainy day and see for yourself. Then go inside and check out the furnace, looking for drafts, leakage issues and other possible structural/maintenance problems. If they're apparent, determine how much money it's going to take to get everything up to snuff and factor that into your offer, adjusting your price accordingly.
 

By Vera Gibbons

Simple ways to ensure your identity is protected

The 2013 Identity Fraud Report released in February by Javelin Strategy & Research found 12.6 million victims of identity fraud in the United States over the past year. That equates to 1 victim every 3 seconds. Protect your identity using these simple steps.

1. All your wireless devices, including your cell phone should require a password. Passwords should include capital letters and symbols and be updated regularly. Be sure to lock your desktop every time you step away from your computer.
2. Don't opt in or give companies permission to share your information.
3. Be cautious of what you share on social media and do not post information that someone can use to authenticate your identity.
4. Sensitive documents should be shredded.
5. Store all your credit card information in a safety deposit box so you can cancel them in case your information is stolen.
6. Never give out personal information over the phone, through the mail or online unless you are absolutely certain of the source.
7. Only work with reputable online companies that have secure lines when making purchases.
8. Monitor bank and credit card statements and get a free credit report annually.

Why Location Matters in Real Estate

Ask just about any real estate agent to list the three most important things a property should have, and you'll likely hear: "location, location, location." That phrase has been in use at least since 1926, according to The New York Times, and is just as relevant now as it was then.
 

But why does location matter so much? For starters, you can't move a home - at least not easily or inexpensively. When you buy a home in a good location, it's usually a solid long-term investment.
 

Real estate agents often advise their clients to buy the worst house - a property that could use some TLC - on the best block. Why? Because fixing up a home in a great neighborhood will give you the best return on your investment. Quite simply, it will be easier to sell later on. Conversely, you can buy a beautiful home that doesn't need any work. But if the block is sketchy or just plain bad, you could have a hard time selling the property at a decent price.
 

So if "location, location, location" is so important, what makes a location good? Here are five characteristics to look for when buying a home. If you can get all five, chances are the home's a great investment.

1. A safe neighborhood
People want to live where there's little or no crime. Naturally, they want to feel safe in their homes and will pay extra for it. A safe neighborhood means people will feel free to walk around, be outdoors and interact with their neighbors. Communities still exist today where people don't lock their doors, and they know their neighbors are there for them in a pinch.

2. Good schools
Being in a good school district is important, even if you don't have school-age kids and never plan to have any. Fact is, young families always will be buying their first or second homes. They will do their home search based on location in general and good school districts in particular. The better the school district, the higher the values of the surrounding homes can be.
Found a home you love but the school district is subpar? Be aware of that issue for resale down the road. Bottom line: When you buy a home, you should always think like a future seller.

3. Convenient access to popular places, shops and restaurants
Everyone wants to be near the best commercial districts. The closer to the hubbub of a particular town or the best parts of a city, the better the location - and the more someone is willing to pay for a home. In beach communities, the closer to the beach, the more valuable the property.

4. Water access and views
No matter which town or city, someone will always pay for a great view or to be on or near the water. Put a home right on a waterway or on a hill with panoramic views and you've got a great location.

5. Access to public transit and/or freeways
In major cities, the farther you live from the bus, subway or other types of mass transit, the less valuable the home. A good location means being very close, and having easy access, to public transportation. Being near a train or bus can get you anywhere in a short amount of time. In some towns, where a commute by car is inevitable, easy access to the freeway makes for a good location. Adding 20 minutes to a commute just to get to the freeway never helps a location.

What makes a bad location?
There are some common characteristics that make a location "bad," no matter where you are.

Ever see a home with a backyard that faces the freeway? Whether the home is in Denver, Dallas or Dubuque, such a location is likely always going to be considered undesirable. Is the home on a busy intersection or a four-lane road? Again, it's probably considered a bad location, no matter which town it's in or what the nearby neighborhood is like.
 

Other factors that can make for a "bad" location: very close proximity to a fire station (good if your house is on fire, not so good if you're trying to sleep); a hospital (frequent ambulance sirens); an airport (sounds of jet engines 18 hours per day) or a school (traffic from buses or parents dropping off children or kids yelling and playing).
 

Some "good" and "bad" qualities simply vary by community. If you know your local community, you know which parts of town are less or more desirable. It's always smart to rent in a new community before committing to a home purchase. Renting allows you time to become familiar with the location.
 

All these things matter when you're considering the location of a home for sale. But never lose sight of what matters most to you about the location. If you're crazy about baseball, for instance, you might love owning a condo near your city's professional baseball team ballpark. Someone who doesn't like baseball, on the other hand, would probably not want to live near all the commotion.
 

Location, location, location really does matter - a lot. But as always, the most important thing is to buy the right home for you, at the right time.
 

By Brendon DeSimone | Zillow