Author Topic: Selling my house in Mid City Los Angeles in April  (Read 777 times)

shah8

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Selling my house in Mid City Los Angeles in April
« on: March 23, 2020, 12:35:20 AM »
I have spent the last several months (since January) getting ready to sell my house in Mid-City Los Angeles in a desirable neighborhood. I am planning on putting it on the market Mid April. The home is currently worth about 1.6 Million judging by comps. Do you think it will hold it's value for the next couple of months? I'm hoping demand for housing won't change in a couple of months. My Real Estate agent thinks we will get multiple offers and it will sell fast. I'm worried about the unique challenges the COVID-19 virus will pose. Everything from the collapse of the real estate market, lack of potential buyers, municipal services being temporarily closed like the County Recorders office etc. Can anyone offer some insight? Thanks. 
« Last Edit: March 23, 2020, 12:44:06 AM by shah8 »

bayareasaver

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Re: Selling my house in Mid City Los Angeles in April
« Reply #1 on: March 23, 2020, 03:45:33 AM »
Hi @shah8 I hope you and your loved ones are safe during this intense time. Of course no one can predict the future, but I hope some of the answers other community members have provided in response to my question a bit below yours will be helpful to you (it's titled something like: prepping to sell my California house in July: eviction? capital gains?).

The main synopsis is this:
*We don't know how long the shelter in place order will last, so we'll have to wait and see.
*Rely on your realtor and personally I would say get a second opinion if possible since of course it is in your realtor's best interest to get you to list and sell. My realtor has said that pre-shutdown inventory was very low and she expects that to continue.
* It's TBD whether pre-shelter in place comps will be comparable to post-shelter in place comps.
* Personally I'm doing various scenarios to see how much of a hit I'm willing to take post-shelter in place knowing we're heading into a recession (or, IMHO, a depression).
* I just heard on the news today that RE values dropped by 6% during the last recession, so that's going into my scenario planning: would I still want to and be motivated to sell if the value dropped by 6% off of the pre-shutdown comps? In my case, most likely yes, in your case, you'll need to be the judge of that.
* In re. to your question of will demand dry up: YES, it has to. The question is how much. Again, IMHO. How could it not? My home is a small 2 bedroom one bath so I'm hoping there's a family out there that will be looking to downgrade from a home they can no longer afford, but who knows.
* It's also tough to say whether people will be moving around because we know that some sort of mortgage relief package will be coming. The good news is this package could help you and I to cover our carrying costs.

So, back over to you, what are your options? Are you open to renting it out or staying in it? Are you moving out of state? Can you tell us more about your circumstances?

Take care and stay safe.

norajean

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Re: Selling my house in Mid City Los Angeles in April
« Reply #2 on: March 23, 2020, 06:15:12 AM »
Until the situation improves, nobody is going to be selling or buying any real estate. Sit tight.

Another Reader

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Re: Selling my house in Mid City Los Angeles in April
« Reply #3 on: March 23, 2020, 07:18:19 AM »
Hi @shah8 I hope you and your loved ones are safe during this intense time. Of course no one can predict the future, but I hope some of the answers other community members have provided in response to my question a bit below yours will be helpful to you (it's titled something like: prepping to sell my California house in July: eviction? capital gains?).

The main synopsis is this:
*We don't know how long the shelter in place order will last, so we'll have to wait and see.
*Rely on your realtor and personally I would say get a second opinion if possible since of course it is in your realtor's best interest to get you to list and sell. My realtor has said that pre-shutdown inventory was very low and she expects that to continue.
* It's TBD whether pre-shelter in place comps will be comparable to post-shelter in place comps.
* Personally I'm doing various scenarios to see how much of a hit I'm willing to take post-shelter in place knowing we're heading into a recession (or, IMHO, a depression).
* I just heard on the news today that RE values dropped by 6% during the last recession, so that's going into my scenario planning: would I still want to and be motivated to sell if the value dropped by 6% off of the pre-shutdown comps? In my case, most likely yes, in your case, you'll need to be the judge of that.
* In re. to your question of will demand dry up: YES, it has to. The question is how much. Again, IMHO. How could it not? My home is a small 2 bedroom one bath so I'm hoping there's a family out there that will be looking to downgrade from a home they can no longer afford, but who knows.
* It's also tough to say whether people will be moving around because we know that some sort of mortgage relief package will be coming. The good news is this package could help you and I to cover our carrying costs.

So, back over to you, what are your options? Are you open to renting it out or staying in it? Are you moving out of state? Can you tell us more about your circumstances?

Take care and stay safe.

In 2009, the house next door to me in Silicon Valley sold for over 30 percent less than it would have in 2006.  That was typical.  I would love to see the basis for the 6 percent claimed.

waltworks

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Re: Selling my house in Mid City Los Angeles in April
« Reply #4 on: March 23, 2020, 11:21:41 AM »
Yeah, if we're talking the US, house values dropped a hell of a lot more than 6%.

Case Schiller national data said average sale went from around $184k to $136k from peak to trough. That's around 36%.

OP: Don't plan on selling in April. Don't plan on selling until the C19 crisis is well over, unless you want to sell at a significant discount.

-W

bayareasaver

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Re: Selling my house in Mid City Los Angeles in April
« Reply #5 on: March 23, 2020, 09:28:37 PM »
Thanks @waltworks and @Another Reader , that's very helpful since I'm hoping to sell my house soon myself (in July when my tenants' lease is up). The 6% decrease figure during the last recession I heard was on the news here in New Zealand which a cab driver the other day told me was not as impacted as the US.

And your figures do make sense, I was only able to buy the house I'm now hoping to sell because it had decreased in value tremendously from the previous purchase price (and they were foreclosed on by the banks).

Sorry if this has been posted in another thread, but since I'm here in NZ I'm not seeing the same news... has there been a mortgage forgiveness plan announced or do you think there will be one soon, and do you advise passing that along to renters or only if they reach out to my property manager and specifically state they can't pay and are looking to get out of their lease early?

I can post another question if this is off topic for this thread, but I thought the possibility of mortgage relief may be of interest to the OP and I.

Thanks!

waltworks

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Re: Selling my house in Mid City Los Angeles in April
« Reply #6 on: March 23, 2020, 09:37:18 PM »
There has not been any mortgage forgiveness plan in the news, and I would be shocked if such a thing was even proposed.

-W

bayareasaver

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Re: Selling my house in Mid City Los Angeles in April
« Reply #7 on: March 24, 2020, 03:16:48 AM »
Thanks @waltworks , I guess living in New Zealand for 9 months is long enough for me to forget that practical measures to stem economic collapse are not really on brand for the U.S.

And I misspoke, I didn't mean mortgage forgiveness, what's being rolled out here is being called a 'mortgage holiday' of no interest or principal due for 6 months for covid-impacted homeowners. This doesn't apply to me since the home I own is in California, but if you're curious as to how another part of the world is handling this you can check out an article here: https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12319507 Kiwis - so practical!

Take care and stay safe everyone.

spartana

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Re: Selling my house in Mid City Los Angeles in April
« Reply #8 on: March 24, 2020, 09:36:04 AM »
Hi @shah8 I hope you and your loved ones are safe during this intense time. Of course no one can predict the future, but I hope some of the answers other community members have provided in response to my question a bit below yours will be helpful to you (it's titled something like: prepping to sell my California house in July: eviction? capital gains?).

The main synopsis is this:
*We don't know how long the shelter in place order will last, so we'll have to wait and see.
*Rely on your realtor and personally I would say get a second opinion if possible since of course it is in your realtor's best interest to get you to list and sell. My realtor has said that pre-shutdown inventory was very low and she expects that to continue.
* It's TBD whether pre-shelter in place comps will be comparable to post-shelter in place comps.
* Personally I'm doing various scenarios to see how much of a hit I'm willing to take post-shelter in place knowing we're heading into a recession (or, IMHO, a depression).
* I just heard on the news today that RE values dropped by 6% during the last recession, so that's going into my scenario planning: would I still want to and be motivated to sell if the value dropped by 6% off of the pre-shutdown comps? In my case, most likely yes, in your case, you'll need to be the judge of that.
* In re. to your question of will demand dry up: YES, it has to. The question is how much. Again, IMHO. How could it not? My home is a small 2 bedroom one bath so I'm hoping there's a family out there that will be looking to downgrade from a home they can no longer afford, but who knows.
* It's also tough to say whether people will be moving around because we know that some sort of mortgage relief package will be coming. The good news is this package could help you and I to cover our carrying costs.

So, back over to you, what are your options? Are you open to renting it out or staying in it? Are you moving out of state? Can you tell us more about your circumstances?

Take care and stay safe.

In 2009, the house next door to me in Silicon Valley sold for over 30 percent less than it would have in 2006.  That was typical.  I would love to see the basis for the 6 percent claimed.
I'm from Orange County and prices dropped 54% at their lowest. Tons of bank owned foreclosures (like literally most every house in a neighborhood) and stayed that way for several years. I think 2012 was the lowest decline before things started to pick up. If you need to sell then sell but if you can afford to wait that might be better.
« Last Edit: March 24, 2020, 09:40:23 AM by spartana »

affordablehousing

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Re: Selling my house in Mid City Los Angeles in April
« Reply #9 on: March 24, 2020, 11:56:35 AM »
Our neighbors are planning to put their house on the market in two weeks. We know the agent, they're as good as any agent, and they're sticking to the plan. You can't have open houses, they're shown virtually. There isn't much on the market and there are still people that need a place to live, especially in the not ultra-luxury market ($1.6MM sounds like a pretty standard family home in that part of LA). I think you should do it now before Covid fatigue sets in and people that had a little more time to adjust their plans sit out their life changes.

shah8

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Re: Selling my house in Mid City Los Angeles in April
« Reply #10 on: March 24, 2020, 01:58:59 PM »
Our neighbors are planning to put their house on the market in two weeks. We know the agent, they're as good as any agent, and they're sticking to the plan. You can't have open houses, they're shown virtually. There isn't much on the market and there are still people that need a place to live, especially in the not ultra-luxury market ($1.6MM sounds like a pretty standard family home in that part of LA). I think you should do it now before Covid fatigue sets in and people that had a little more time to adjust their plans sit out their life changes.
Original poster here. Thanks to everyone that chimed in. I am moving ahead with the sale. We are going to put it on the market right after Easter/Passover. I'm hoping demand for housing won't change in 1-2 months from now. Those that had cash reserves in the stock market for a deposit on a home are out, but demand remains strong for sub $2mm properties in LA. I'm hoping the real experts are going to be buying now when all other buyers are scared away.

Dicey

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Re: Selling my house in Mid City Los Angeles in April
« Reply #11 on: March 24, 2020, 02:10:16 PM »
Our neighbors are planning to put their house on the market in two weeks. We know the agent, they're as good as any agent, and they're sticking to the plan. You can't have open houses, they're shown virtually. There isn't much on the market and there are still people that need a place to live, especially in the not ultra-luxury market ($1.6MM sounds like a pretty standard family home in that part of LA). I think you should do it now before Covid fatigue sets in and people that had a little more time to adjust their plans sit out their life changes.
Original poster here. Thanks to everyone that chimed in. I am moving ahead with the sale. We are going to put it on the market right after Easter/Passover. I'm hoping demand for housing won't change in 1-2 months from now. Those that had cash reserves in the stock market for a deposit on a home are out, but demand remains strong for sub $2mm properties in LA. I'm hoping the real experts are going to be buying now when all other buyers are scared away.
Be sure to price it realistically when the time comes. Real experts know their shit.

A friend's daughter's family took a job transfer recently. The first two realtors estimated about the same selling price. The third convinced them the house was worth $200k more, so they went with the third realtor. Result? It's been on the market for 74 days and had two huge price drops. Guess what? It's still too high and now the tide has turned. And now they're in the new city in temporary housing and can't buy anything until their other house sells. Your circumstances might be slightly different, but the need for caution and back-up plans still very much exists.

waltworks

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Re: Selling my house in Mid City Los Angeles in April
« Reply #12 on: March 24, 2020, 02:14:24 PM »
I'm hoping the real experts are going to be buying now when all other buyers are scared away.

First: lets all hope things are going great by then. Good luck.

Second: can you explain what you mean by that quote? "Real experts", assuming you mean investors, aren't generally going to be buying $1.6million houses. If other buyers (non experts?) are scared away, that does mean investors will be interested - but you won't be happy with the offers you'll get from them.

RE investors know very well when demand is low/people are scared. They also know that house prices are sticky and they can afford to wait. That kind of buyer is NOT who you want buying your house, because if that happens, it means you're selling it for a fraction of what you were asking.

Basically, you don't want me (or many others on this thread) interested in your house. Because we are only going to be interested once we smell enough blood in the water.

-W

Dicey

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Re: Selling my house in Mid City Los Angeles in April
« Reply #13 on: March 24, 2020, 02:18:46 PM »
I'm hoping the real experts are going to be buying now when all other buyers are scared away.

First: lets all hope things are going great by then. Good luck.

Second: can you explain what you mean by that quote? "Real experts", assuming you mean investors, aren't generally going to be buying $1.6million houses. If other buyers (non experts?) are scared away, that does mean investors will be interested - but you won't be happy with the offers you'll get from them.

RE investors know very well when demand is low/people are scared. They also know that house prices are sticky and they can afford to wait. That kind of buyer is NOT who you want buying your house, because if that happens, it means you're selling it for a fraction of what you were asking.

Basically, you don't want me (or many others on this thread) interested in your house. Because we are only going to be interested once we smell enough blood in the water.

-W
Oh Walt, your post, particularly that last bit, made my sorry-ass, sick self laugh out loud. So true!

shah8

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Re: Selling my house in Mid City Los Angeles in April
« Reply #14 on: March 24, 2020, 02:54:48 PM »
I'm hoping the real experts are going to be buying now when all other buyers are scared away.

First: lets all hope things are going great by then. Good luck.

Second: can you explain what you mean by that quote? "Real experts", assuming you mean investors, aren't generally going to be buying $1.6million houses. If other buyers (non experts?) are scared away, that does mean investors will be interested - but you won't be happy with the offers you'll get from them.

RE investors know very well when demand is low/people are scared. They also know that house prices are sticky and they can afford to wait. That kind of buyer is NOT who you want buying your house, because if that happens, it means you're selling it for a fraction of what you were asking.

Basically, you don't want me (or many others on this thread) interested in your house. Because we are only going to be interested once we smell enough blood in the water.

-W
Hey W, Thanks for your insight.
Most of the homes in my area of Los Angeles are usually bought by RE investors and ripped down to the studs and then they turn it into a McMansion. I can afford to wait and don't need to take a low ball offer.

spartana

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Re: Selling my house in Mid City Los Angeles in April
« Reply #15 on: March 24, 2020, 03:05:33 PM »
I'm hoping the real experts are going to be buying now when all other buyers are scared away.

First: lets all hope things are going great by then. Good luck.

Second: can you explain what you mean by that quote? "Real experts", assuming you mean investors, aren't generally going to be buying $1.6million houses. If other buyers (non experts?) are scared away, that does mean investors will be interested - but you won't be happy with the offers you'll get from them.

RE investors know very well when demand is low/people are scared. They also know that house prices are sticky and they can afford to wait. That kind of buyer is NOT who you want buying your house, because if that happens, it means you're selling it for a fraction of what you were asking.

Basically, you don't want me (or many others on this thread) interested in your house. Because we are only going to be interested once we smell enough blood in the water.

-W
Hey W, Thanks for your insight.
Most of the homes in my area of Los Angeles are usually bought by RE investors and ripped down to the studs and then they turn it into a McMansion. I can afford to wait and don't need to take a low ball offer.
Many of those investors aren't cash-flush any longer. Or they are Chinese/foreign investors who may not be able to fund such purchases any longer.  Or the tear down and rebuild if capital is short along with supply lines of materials that come from overseas. Then there is the length of time for permits to be issued (approx 18 months to 2 years for a year down) and the investor/buyer will need to rent the place out during that time to cover expenses. In the current unemoyment scenario it may be very difficult to find renters for a million plus dollar home - especially if foreclosures are rampant or job loss continues.

I'm not trying to be a negative Nancy but just saying that current investors and developers may not be in the same position they were in even a month or 2 ago.

waltworks

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Re: Selling my house in Mid City Los Angeles in April
« Reply #16 on: March 24, 2020, 03:10:04 PM »
Got it. Keep in mind that putting/keeping a house on the market isn't free, though. I guess maybe if you're not staging it, that expense goes away, but at the very least you can't have it rented while it's on the market.

If you can afford to wait, I would, if just to see how things are developing. I don't think anyone knows what will happen next but my opinion is that most of the likely outcomes aren't great for selling RE for the next few years.

-W