How's the San Fernando Valley Real Estate Market?

Homethinking sat down and spoke to Jerry Gooze with Pinnacle Estate Properties about the real estate market in the San Fernando Valley and where it's headed.

What types of properties are selling fastest/slowest in your market area, and why?

Entry-level single-family residences properties in the $250K-400K range are selling quickly if they are in reasonable condition woth competing offers. Over-priced properties will still sit unsold. Mid-priced properties will sell if priced properly, sometimes with competing offers. Higher priced properties must be priced properly or they will sit.

Condos & Townhomes sell at a slower pace. Some Condo & Townhome Homeowners Associations that are in troubled finasncial condition because of the economy can be an obstacle to the Buyer getting their low. This is especially true with FHA trransactions where HOA's may lose their FHA-Approved Designation and the sale can't go through.

Is anything changing about the profiles of buyers/sellers in your market area?

We are seeing more first-time buyers proportionately because they have the interest tax deduction to gain, as well as all the advantages of home ownership.

There are fewer move-up buyer because Seller's have compressed or no equity to realize in helping them to move-up.

Because of lack of inventory, Buyers are realizing they need to step up to the plate on price if the asking price is reasonable, or someone is buying the property while they are negotiating. Buyers need to realize they are already winners because the prices are so low,and additionally, interest rates are so low! That's a DOUBLE WIN!!! $10,000 higher on price is less that $50 per month! Buyers only win if they secure the property. You can only live in a house, you can't live in a lost negotiation!

Are you seeing any change in the market share of short-sale properties or REO properties?

Distressed Sales or Short Sales & Foreclosures compose about 50% of the market. Lenders seem to be holding off on relesing Foreclosures to the marketplace because of the low prices. Short Sales are still troublesome to close much less close in a timely manner. They commonly run six months or more! Why do they call them SHORT Sales? They should call them LONG Sales! Buyers will fare better if they have all cash or a large downpayment on foreclosures. They don't want to have to worry about loans if they can avoid it. Also Foreclosure Lenders are very demanding and often want it their way or the highway. They won't pay for alot of Seller's traditional costs, and often try to saddle the Buyers with them. That's a trade-off for hopefully a low, low price!

What worries you most about the current state of the market? What represents a sign of optimism/opportunity?

I don't see a recovery in sight unless there is a change in the direction from the election. A new President may help spur the economy in a positive direction. If the election brings the same thing, we can probably expect the same thing or worse.

Where are sellers moving to, and where are the buyers moving from in your market area? Does this represent a change?

Retirees are moving to less expensive area out of the city. We are seeing Buyers move from more expensive areas near the City to less expensive but still nice Suburbs. This is not really new, but is accelerated in a challenging economy.

How have you changed your business to mirror the market and to capitalize on market trends?

I love helping people. That's what I've always done for almost 35 years! I don't have much interest in working with bank foreclosures. I'd rather work for people than banks! I don't change what I do based upon short-term trends. Many agents get off course by bouncing from one thing to another. They should pick a direction they enjo and stick with it. It has worked wondefully for me, but I can work very hard because I love what I do! Too many agents look for the easy way. There is no easy way! You need to love being a Real Estate Agent or it won't work out!

What are some overall economic trends you're seeing in your market area that will guide the real estate market?

I see a slight tipping up of prices because of a lack of inventory. If the back-up ion Foreclosures is released by banks that would increase supply , and weigh downward on real estate prices. A change in economic policy from the elections would of course help prices and the economy. The more jobs, the more people can buy.

Thanks once again to Jerry for his time and insights and if you'd like to browse more West Hills Realtors please visit Homethinking!