So Cal Real Estate News

Los Alamitos, the second smallest city in Orange County, sits just east of Long Beach on the Orange County/Los Angeles County line.  Because most of the city is in the 562 area code, many people think its in Los Angeles County.  It shares it’s zip code and post office with Rossmoor,  a large, upscale unincorporated trac.  Los Al shares its highly-regarded school district with Rossmoor and Seal Beach.

Los Alamitos has been my home town for twenty years.  It’s a great place to live.  In many ways ranging from location to schools to climate it may be one of the best places in Southern California for someone with a middle class income to buy a home.  (In fact, I just happen to have a beautiful 5 bedroom pool home on a cul de sac that we recently listed–details and virtual tour at LosAlDreamHome.com.)

Like any town, Los Alamitos isn’t perfect.  Two things about it bother me the most.   Although Los Alamitos has fewer than 7,000 registered voters, it’s in the big leagues when it comes to traffic congestion and hostility on it’s City Council. It’s a case of periodic gridlock on the streets and at city hall.

As a Realtor, my job for the last 28 years has involved getting buyers and sellers to work together for their mutual benefit.  I’m a big believer in “win-win” negotiating.  So I decided to toss my hat in the ring for this year’s Los Alamitos City Council election, to see if I could get our divided City Council to work as one team instead of two.  In a town this small, we have more things that unite us than that divide us.

I recently started a blog, LetsFixLosAl.com, for several reasons:

• To promote a greater spirit of teamwork on Los Alamitos’ City Council.
• To suggest and promote strategies to reduce the occasional gridlock on Los Alamitos’ streets.
• As a 21st century town hall meeting in cyberspace where citizens can discuss these issues 24/7/365.

Oh yeah.  The blog seemed like an inexpensive way for a political neophyte to compete for two council seats against three former mayors and another neophyte.

LetsFixLosAl.com is less than a week old, and only has a few posts up, but I plan to add to it several times a week, chronicling first-hand the adventures of a newbie small town politician.   At this point, I’d also appreciate input from both local residents and anyone else with a good idea to share.

Check it out, and let me know what you think.  It should at least provide some interesting insights on politics from a front-line perspective.  Pretty much what we try to do with Southern California real estate on this site.

Note, 7/15: This is our classic post on the current housing turmoil. We think we’ve been proven right by subsequent events, so there’s no need to modify it, although we’ll occasionally add updates at the end. We think it’s as relevant today as it was when it was written.

Yesterday (11/27) the Los Angeles Times front page asked “Homeowners’ big question, How low will prices go?”

Today, they gave us a partial answer: “L.A., O.C. home prices decline sharply.”

We’ve got a better answer: “Nobody knows.” We first heard it at the California Association of Realtors’ economists panel in Anaheim last month. It came from Frank Nothaft, chief economist at Freddie Mac, as he was discussing how low prices would go and when things would turn around: “We just don’t know,” Nothraft said. “We’re in totally uncharted territory.” His point being that the problems brought on by sub-prime lending make this “correction” a new animal.

In a way, however, Northaft was just restating the conventional wisdom regarding any market’s cycles: “They don’t ring a bell when it hits the bottom. Or the peak.”

The consensus seems to be we’ve got 1 - 3 down years ahead of us, more if a major recession hits. Most economists also predict that Southern California real estate will take a bigger hit than the national average, just as we went up more. Prices are predicted to “correct” between 15% and 40%, with most economists in the 20% to 25% correction range. Maybe worse for outlying areas like the Inland Empire or Palmdale, and for entry level condos everywhere.

Having a bit of a contrarian nature, when everybody gets on the recession bandwagon, we start thinking about getting off. To be honest, we’ve already seen price corrections of as much as 20% in Lakewood, Los Alamitos, parts of Long Beach and Orange County and some other markets we serve.

That’s from peak to current low, and it’s comparing like homes (similar location, size, & condition), not the almost useless median selling price that takes comparing apples with oranges to an insane new level.

With interest rates dropping again and prices already down, we wouldn’t be surprised to see prices start moving upward this coming February. But we wouldn’t be surprised if they kept dropping as well. (We’re talking about prices on homes going into escrow in February, not closings. So the increase that may come this February would show up in March or April closing statistics.)

Why don’t we know? “Uncharted territory.” Too many variables: interest rates are dropping, prices have dropped, but more foreclosures are coming, and Congress may be making the “liquidity crisis” worse with the House’s proposed “reform” bill. We just don’t know. Nobody does. If they say they do, they’re either lying or deluded, or God.

What to do when nobody knows when we’ll hit bottom? That’s in the post which follows this one, (”What to Do When Nobody Knows What’s Next”).

7/15 update: Nobody knows what’s next, but that doesn’t stop us from making our best projection, which we try to update regularly as needed. For our latest posts, just look under “Recent Posts” near the top of the column to the right.

On a more uplifting note, you might also want to check out “A little perspective.”

Finally, we’ve added two links at the top of the column to your right so you can search almost all of Southern California’s Multiple Listing Services directly:

Search So Cal M.L.S. gives you direct access into the MLS covering Orange County and southeast Los Angeles County (think Greater Long Beach).

Search M.L.S. Alliance gives you direct access to a search across almost all Southern California Multiple Listing Services.

Feel free to play with them both & see which one you prefer. You shouldn’t find any ads as you use them, but you will have to deal with our picture as you search. We’ve been told you can print it & put it in your attic to deter termite and pest infestations.