How to research the history of your Los Angeles home.

Discovering the history of your house can be an interesting and rewarding exercise.  Basic curiosity may cause you to wonder who may have built the house, and who lived there before you moved in.  What changes has the house undergone? Did anyone famous live there?  Many of these questions can be answered with an internet connection and a bit of time.

A few years back, I was renovating the master bedroom of my house to convert a small adjacent room into a walk-in closet.  The room had a door to the master already installed in the closets of both rooms.  When I discovered some of the original unpainted plaster in the added closets, I realized that there were major renovations done to the house not long after it was built.  So, I got online & investigated the history of my house and can share a few resources I used to find out about my house.

You can start your investigation at the LA County’s assessor office

https://portal.assessor.lacounty.gov

Here you can get some basic facts, like the year built and prior sales.

The next site I checked is the online records for the Los Angeles City Department of Building and Safety.

http://ladbsdoc.lacity.org/idispublic/

The building permits can be a wealth of information.  For my house, I was able to access the original building permit. It showed the owners name & address as well as the contractors name.  My house was built in 1921, and it was built as a 1.5 story, not the 2-story house that I live in now.  Over the years there have been a number of changes to the house that were documented in the permits applied for.  But nothing in the permits showed that the house was changed to a 2 story from a 1.5.

The next step was to look up the house in the Federal Census.  There are a couple of sites that provide census records.  The Los Angeles Public Library offers HeritageQuest online (you need a Los Angeles Public library card).

https://www.ancestryheritagequest.com/HQA

This site is easier to use to find a person but if you spend a bit of time reading the district descriptions, you can browse your district records and find your home address pretty fast. The 1940 Census is fully digitized and is easier to find your home.

https://1940census.archives.gov/getting-started/

Another resource you can access via the Los Angeles Public Library are reverse look up city directories.  https://rescarta.lapl.org/ResCarta-Web/jsp/RcWebBrowse.jsp These directories are much easier to find your address in but the number of directories online are relatively small compared to what the library has downtown.

Another great place to check is Movie Land Directory.

http://movielanddirectory.com/

It is an online resource that allows you to look up an address to see if anyone from the entertainment industry lived at an address. I recommend just entering your street name, then scrolling thru the results to find your address if it exists.

Once you have the names of the folks who owned or lived in the house, you can do some sleuthing in the genealogical sites like Ancestry and FamilySearch. I would love to have photos of my house from the past and by looking for descendants of the residents of my house online I had hoped to reach out to some of them to see if I could obtain copies of photos that included the house.  So far, no luck with that.

But I did learn quite a bit about the house, the most significant fact was that in the 1940 census the house was owned & lived in by a contractor & his wife.  He had three single adults living in the house as lodgers.  My guess is that he built out the upstairs to be a full 2 story home in order to be able to rent out rooms to tenants.

Another fact I found interesting is the number of permits issued to change the garage.  When the house was built, the garage was quite small, but eventually, it was widened and extended over the years as the cars kept getting bigger and bigger.  In this way, the physical structure of the home and its changes reflect the broader social history of LA.  Now, after almost 100 years, I am embarking on a project to convert my garage to an accessory dwelling unit, reflecting the current housing shortage and reduced reliance on cars that the city of Los Angeles is undergoing.

 

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Will the New Tax Law Impact the Real Estate Market

Over the past few years, the real estate market in Los Angeles has been “good” for sellers; prices rise each year and houses sell fast. The market has not been so good for buyers because there are too few houses for sale and they have to pay more and often times are outbid on houses.

The question this condition inevitably brings up is will this market condition this change anytime soon.   This is especially being asked now that Congress has passed the “Tax Cuts and Jobs Act” with significant changes to deductions allowed related to real estate.

To refresh your memory, the new tax law changes some important deductions related to real estate.

First off the amount of the mortgage interest deduction has been reduced from a maximum of $1,000,0000 to $ 750,000.  Also, the property tax deduction has been capped at $10,000.  Both of these changes could reduce people’s incentives to own property as the tax benefits are no longer as strong.  Also, since the standard deduction has been increased, you may not itemize deductions at all, making both the mortgage interest deduction and property tax deduction less important.

Another impact this tax bill has on real estate is the impact it will have on mortgage interest rates.  Although we have been expecting to see interest rates increase as the economy grows, this tax bill is basically stimulus spending and we can expect to see the interest rate rise fast than otherwise.

So with fewer incentives for home buyers and higher interest rates on the horizon, will we see prices go down?  Not likely.

The problem in the market now is low inventory and that will continue to prop up prices, especially here in Southern California.  There is nothing in the tax bill that will incent sellers to sell.  In fact, it is likely to have just the opposite effect.  The cap on the mortgage interest deduction is grandfathered in, so if you currently have a mortgage over $750,000 the interest is fully deductible up to $1,000,000.  If you were to sell, and get a new mortgage, you would now only be able to deduct the interest on the first $750,000.

The impact of the federal tax bill will probably affect certain segments of the local real estate market greater than others.  For first time buyers and sellers of homes under $1,000,000, the California Association of Realtors (CAR) sees minimal impact.

The impact of the tax bill is more likely to dampen price appreciation on higher priced homes, both because these homes require higher mortgages and property taxes, but also because these homes are traditionally part of the trade up cycle we see in real estate.  As more people hold on to the homes they are in now, fewer buyers for more expensive homes will be available.  CAR expects homes priced in the $1,500,000 range to see a 4.4% reduction in price appreciation due to the Tax Bill.

So the key takeaway is that latest tax reform will have some adverse effect on the Los Angeles housing market and the degree of impact varies by price and location.  In general, the Tax Cut & Jobs Act will reduce overall price growth but only by about 1%.  The housing supply problem will be increased as the tax bill will force homeowners to delay trading up or down to their next home. Mortgage rates will likely raise a bit faster as the economy heats up.

So if you think now might be a good time to sell, or you just want to talk through your options, call LAAndyMay 213-713-0385

What $600,000 or less buys you in Los Angeles

In August, the median home sales price in Los Angeles County rose to $602,000.  This is up 7.5% from a year ago and above the peak of $600,000 in August 2007.  The median price has climbed every year since 2012 and it does not appear to be poised to go down anytime soon.  With low inventory and a growing economy, there is little expectation that a significant drop in prices will come anytime soon.

The median sales price means that half the properties sold are below $602,000 and a half are above.  With 7,400 properties sold in August, you can assume there are about 3,700 properties in Los Angeles County that sold below $602,000.  So this begs the question… Where are these more affordable houses?  The answer, to begin with, is not many can be found in the highly popular areas of Los Feliz, Silver Lake, Echo Park & the greater Northeast Los Angeles area.

A quick search shows 30 properties on the market for under $600,000; 11 condominiums and 19 single family residences.

There is one single family residence for sale under $600,000 in all of Silver Lake & Echo Park.  Listed at $475,000, this is a tiny house that appears to be a serious fixer-upper; only cash buyers are being sought.

echo park

There are no single family homes for sale in Los Feliz for under $600,000 but among the 4 condos for sale, there is one listed at $430,000, a steal for this desirable neighborhood.

los feliz

The largest single concentration of homes under $600,000 in the area is in Highland Park where you can find 2 condos, and 6 single family homes currently on the market under $600,000.  The single-family homes range in size from 737 square feet for a 1907 bungalow to a 2000 square foot fixer with tenants who will have to be bought out.  But you can get a fully renovated flip house for $550,000.

Highland Park

Both the Glassell Park & Eagle Rock neighborhoods have 4 single family homes on the market under the $600k, and both have at least one that is a very nice small home in addition to the cash only fixers you see regularly at this price point.

In Glassell Park, you can get a cute cabin in the city for only $555,000.

glassell Park

In Eagle Rock, you can get a 2 bedroom, 1 bath artist’s retreat for $600,000.

Eagle Rock

Home prices will continue to rise in Los Angeles for the foreseeable future, but there are still properties hitting the market every day that you can afford without being a tech entrepreneur or Hollywood show runner.  So if you have been thinking of getting off the rent rolls and into a house, reach out to me.  With the limited inventory at entry level prices, you need a dedicated agent who is motivated by helping people buy their first home. Call LA Andy May.

The Biggest Secret Real Estate Agents Will Not Tell You

Google real estate secrets and you will come up with a ton of results about what real estate agents don’t want you to know.  But talk with a number of real estate agents and you will inevitably come across a few who will offer to let you in on “the secrets of real estate”.  You should be wary when a real estate agent offers to share anything in confidence.

You will hear these “secrets” being shared with you for one reason only, to get you to act fast and work with the agent sharing.  If I have learned one thing above all others in this business, no one can offer a very compelling argument that a secret benefits either the buyer or seller of real estate.  But look below the surface and it’s pretty clear who benefits most from keeping secrets in real estate and that is the real estate agent proffering secrets.

You will hear of a few of the most open secrets in when talking about real estate with agents.  Agents tout their pocket listings, for example, giving the impression they have properties for sale that only they have access to.  Pocket listings are properties for sale that are not listed in the Multiple Listing Service and do not appear in the Apps most people use; Zillow, Trulia, Redfin, etc.  In a few instances, this practice may make sense.  It is certainly within the rights of a seller to withhold the property from the general market.  But the main benefit falls to the listing agent selling the property.  They will make double the commission representing both sides of the transaction.

Some folks will tell you that there are secret arrangements with a small group of agents in a particular area and that if you are buying or selling you should only work with these agents.  If you are a buyer, they claim that they can get your offer accepted over those represented by agents outside the select group.  Although this may happen occasionally, good agents that dominate an area select the best offer for their clients, not the one represented by their friends or co-workers.

When choosing an agent to sell your house, beware of the agent that says they can provide buyers others cannot, or tries to convince you that only they can sell your home for the highest price. They often refer to their own group of buyers as a key element to their ability to sell your house.  But their group of buyers is nowhere as large as the thousands who are out there looking in the market at any given time.

Another common secret you may hear is from an agent is the fact the seller is willing to take less than the asking price. All good listing agents will encourage buyers to make their best offer and occasionally encourage an offer lower than the asking price if the property has been on the make a while.  But to share specific information in regards to the seller’s willingness to accept less is contrary to the fiduciary duty the agent owes to the seller.

A good realtor will attempt to engage with you about your needs and how they can help you achieve your real estate goals.  They will ask questions and offer insight on various aspects of buying or selling a property as it relates to your needs.  Listen carefully and ask questions yourself.  If they are engaged and eager, they might be worth hiring.  If they spend more time touting their own success or trying to convince you they some kind of confidential information, be cautious.  If they seem too eager to share secrets then you know for sure they are just trying to sucker you…  The biggest secret Real Estate agents will not tell you? There are no secrets.

If you would like to talk with a trustworthy Realtor, reach out to me at

www.LAandymay.com

 

The Hot New Thing in Los Angeles Real Estate: Accessory Dwelling Units

They go by many names; Granny flat, Garage Conversation, Mother-in-Law Suite, Backyard Home.   All describe the same thing; Accessory Dwelling Units (ADUs) and they are suddenly the hot new thing in Los Angeles real estate.  Building a second unit on your single family property has become much easier as of January 1, 2017, when California State Legislature passed the Accessory Dwelling Unit Bill (SB 1069 & AB 2299).

The bill eased a number of regulations by reducing parking restrictions, reducing or eliminating water and sewage hookup fees, increasing the maximum allowed size, and requiring a ministerial approval of conversion of an existing ADU.  The city of LA has issued guidelines to inform homeowners what they can do.

Los Angeles has a long history of unpermitted additional units.  In fact, it is estimated 55% of the housing units added in LA County from 1981 to 2000 were unpermitted accessory dwelling units.  Affordable housing advocates are elated with the change in state law. From the increase numbers of permits being sought this year, it appears are homeowners are as well. By the end of February of this year, more than 50 applications to build ADUs were filed with the Los Angeles Department of Building and Safety. That’s more than the full year average for the last decade.

Generally speaking, ADUs can take one of three forms: Detached: Unit is separated from the primary structure, Attached: Unit is attached to the primary structure and Repurposed Existing: Space within a primary residence that is converted into an independent living unit.

So if you are a homeowner looking to leverage your property for income or if you are a first-time buyer and are struggling to afford the high cost of Los Angeles real estate, you now have new options.

For home Buyers looking to qualify for a home loan, lenders may be able to factor in the income from ADUs toward loan qualification.   This could allow you to afford more house than you would otherwise.  Work with a real estate agent to find homes that include a rentable unit on the property.  You will have to perform due diligence to confirm the rental unit is legal, and/or invest additional funds and time to make it legal. The Los Angeles City Council voted in May to approve a new law that makes it easier to get approval for existing units that were created without the city’s approval.

If you already own your home and want to invest in converting your garage into a rental unit you have three options for financing; Refinance your first mortgage and take cash out, get a second mortgage (HELOC), or renovation financing.  Although the costs can be significant, you are not buying the land so the rental income will pay off the investment much faster.

The costs can be significant, and you should plan on a lot of effort and investment of your time to hire architects, contractors and getting the necessary approvals from the city.  There are a number of vendors out there who will handle the entire project for you.

So whether you are a buyer or homeowner expect that Accessory Dwelling units will be something you will see more of in the coming months & years.

Contact me at

http://www.LAandymay.com

Location, Location, Location

It is a phase you will inevitably hear if you are searching for a home to purchase;  “there are three things that matter most in choosing a house; Location, Location & location.”

The phrase has been around a while and it’s a cliché for sure, but there is truth to it that is worth taking a moment to delve into.

The phase points to the most important criteria for selecting a home; it’s value.  Value is what the home is worth, both to you as a buyer and what it might be worth in the future when it comes time to sell.

The value of a home is determined by what a buyer is willing to pay for it.  And despite how much a seller might love the home and its many benefits, the house is on the market with other homes that may or may not have similar attributes and it’s the choice between houses available to buy that drives value.

Location involves two major consideration; the neighborhood or area of town, and the specific physical location of the house in relation to others nearby.

A   3 bedroom, 2 bath home in Beverly Hills will sell for considerably more than a house of the same size in Boyle Heights.   When I work with buyers in the $650,000 range, there are very few choices in Silver Lake or Echo Park but many more in Altadena or Glassell Park.  Price will steer you towards some neighborhoods over others because you can get more house for less.

Value is also defined by where a home is in the neighborhood.  For instance, a house on the corner may sell for less than one in mid-block because there is more exposure to traffic on a corner lot.

Your daily commute tends to drive the neighborhood or area of Los Angeles people consider living.  If your job is in Santa Monica, you are probably not going to be looking in Monrovia for your new home, even though you can get a restored craftsman there for under $700,000.  But some buyers are more focused on the style of the home than the specific neighborhood it’s in and may look in a wide range of areas to find the perfect house.

The bottom line is that once you know how much house you can afford, check various neighborhoods for what houses are going for and focus on a specific area, your home search will go faster and be less stressful.  If you are looking at houses in Highland Park & Monrovia, you probably are going to have too many options to consider and you will find too many excuses to pass on houses as they hit the market.

Once you have an area to search, the location within the neighborhood becomes pretty easy to factor.  If the house is adjacent to the freeway or next to an apartment building, you will see the price reflect that. That’s not to say that it is a bad choice.  If the house is perfect in every way and in a great neighborhood but across from a High School, you may want to make an offer on it because it offers the best value in a higher priced area.  Buying the worst house in the best neighborhood is another often repeated phrase that reflects an underlying reality of real estate.

So if your agent is often repeating the phrase “location, Location, Location”, don’t assume she relies on hackneyed sayings, she is guiding you to focus on getting the best value for your purchase.

contact me at www.LAandymay.com

Can’t Afford a House in LA? Consider A Condo

I work with a lot of first-time buyers searching in Northeast LA. In discussing options and criteria for their first home; they almost universally want a single family house.  This makes sense considering the LA lifestyle you can enjoy in your own home.

But the costs of buying a single family home in LA are keeping a lot of potential buyers from even talking to me.  If you think you cannot afford to buy a home in LA you may be right.  The median sales price as of March 2017 for a single-family home in the City of Los Angeles is $750,000. But here is some good news if you consider other types of property ownership. The median price for a condominium is over $100,000 less.

Right now, if you do a search for property for sale under $350,000 in LA from Hollywood, east to Lincoln Heights,  you come up with 11 Condo listings but only 3 single family houses. As of today (April 19, 2017) there is a small but nice condo for sale in El Sereno for $215,000.

If you are currently renting an apartment in a multi-family building, a Condo will make sense to you.  A condominium is a lot like renting, but you own the apartment, and you are paying yourself rather than a landlord, building equity and starting your climb on the property ladder.

There are pros and cons to buying a Condo.  In addition to affordability, Condos often have amenities like gyms & pools. Many come with balconies, patios, or other outdoor space where you can still get a taste of the LA lifestyle.  If security is a concern of yours, condos can offer more controlled access if not on site security guards in the larger complexes.  Another benefit to buying a Condo in Los Angeles is you will not have to do any landscape maintenance and you will likely spend less overall on the maintenance  & care of your unit.

On the downside, be prepared to pay monthly Home Owner Association (HOA) fees.  If you love to party or are a musician, keep in mind you are still likely to have neighbors above, below or next to you.  Although most condos provide covered parking, inevitably you will be schlepping groceries (and the rest of your stuff) quite a distance from your car to your unit.

As with all real estate transactions, you need to do your due diligence before you proceed with the purchase;  including reviewing the HOA documents for which there may be charges incurred and hire an inspector for a full inspection of the unit.   Buying a home is not as easy as renting, for sure, but if you have a good agent on your side helping you navigate the purchase, buying your first condo can be easier than  you might think,

Rather than putting off making a purchase of property, it may be better to jump into what you can afford now.  As your equity grows (and hopefully your income as well),  your opportunity to purchase that single family home you are dreaming of will likely become a reality sooner if you buy what you can afford now.

 

Contact me at http://www.LAandymay.com