Ask Pete, Chapter 3: Your questions, answered

You asked some good questions, as always. I'll answer the easy ones.

Jackie at 2:38 asks, "Is it possible that even though foreclosures are skyrocketing and prices are plummetting, some neighborhoods (I guess you could call them the better ones) are still competitive when it comes to buying?"
Yes, definitely. What I sense in "better" (more expensive) neighborhoods is that even though prices have softened, it's still common to see multiple offers for good houses in move-in condition.

EG at 2:38 asks, "What are the chances of an 'overcorrection' downward?
Very good in the hardest-hit areas. That said, it's hard to define an overcorrection. Is that when prices fall below market values? No, because the market value and the price are pretty much the same thing. But I think I know what you mean -- in the downturn, prices will fall to a point below what buyers will later decide is a fair price. I think that will happen in some areas.

IToldu2CashOut at 2:49 asks, "What do you see happening with downtown real estate in the next few years? Where you aware of the how the Chapman Flats condos (now rentals) had been misrepresenting square footage? I feel downtown apartments are nice but grossly overpriced for the state of redevelopment, do you agree?"
I'd put downtown somewhere in the middle of the market -- it won't suffer as much as foreclosure hot spots, but will lose more value, on a percentage basis, than established neighborhoods. I was not aware of a controversy over Chapman Flats. I agree that prices downtown are on the high side -- but then I feel that way about L.A. in general.

Candice at 2:57 asks, "What do you think will happen to Countrywide? Relatedly, Greginthevalley at 3:35 asks, Do you think BofA will complete the Countrywide merger given the enormous downside?" (click below for the answer to this, and more questions)

Ask Pete, Chapter 3

What is the third in the series called? The threequel?  Whatever, "Ask Pete" is back, your biweekly chance to pose questions to the blogger.

You know the drill: Use the comment section to ask questions about real estate, the housing market, the news business, the blog, etc. You ask them, I answer the easy ones. Get your questions in by 4 p.m. today, I'll publish answers by 6 p.m.

See previous Ask Pete columns here (#1), and here (#2).
Photo Credit: Getty Images.

Ask Pete, Chapter 2: Your questions, answered

You folks asked some good questions. As is my custom, I'll answer the easy ones:

1) Mike at 12:55 pm asked, " why do you sometimes post in 5 minutes and sometimes in 3 hours??"
Thanks, Mike. If I am sitting at the computer at work and doing nothing else, I post comments very quickly. If it is 7 p.m. and my 4-year-old son yells at me, "DADDY! Turn OFF the computer, let's play baseball!" Then I turn off the computer and play tee-ball in the back yard. Seriously, it's just me moderating comments. I have other duties at The Times, and in life.

2) Uncle Billy at 12:56 p.m. asked, "Did you have an inkling of how different our real estate market would become when you started this blog?"
Thanks, U.B. I thought the market would weaken, but not this quickly, and not this unevenly. I did not see the collapse in the mortgage industry coming. I would have guessed prices in better neighborhoods would be lower right now.

3) mark g at 1:04 pm asked, "Are lender Short Sales impossible to bid for at this point? I saw a property that I was interested in and would like to make an offer, but the offer would be tailored to descend in value with the lengthy time frame that it would take to approve by their loss mitigation."

Thanks, mark. Banks are really slow to approve short sales these days. My guess is, if your offer has strings attached, or an expiration date, it's doomed.

4) Cal at 1:08 p.m. asked, "How do appearances like your appearance on CNN on Saturday happen? Producer calls up and says we need someone to talk about foreclosures?"

(Click below for the answer to that and many more questions)

Ask Pete, Chapter Two

Back by popular demand: Monday afternoon ask-the-blogger Q & A. You ask the questions, I pick the easy ones and answer them on the blog later today.

So bring 'em on: Questions about the L.A. housing market, the economy, the news media, etc.

Ground rules: Submit your questions in the comment section by 3 p.m., I'll answer 10 or 12 of them by 5 p.m. today.

Photo credit: Los Angeles Times

Ask Pete: Your questions answered

You folks asked a bunch of good questions, thanks. I'll answer the easy ones:

1) Dave from Huntington Beach: "My mom is 60 and still working as a physician. She sold when the market was low several years ago (back in the '90s) and never was able to get back into the market. We think she should buy right now when prices are low so that she has a place to retire in 5-10 years. Do you think that's a good idea?"
Pete: If she finds a house she really likes that she can afford, and losing some equity won't bother her, buy it. Otherwise, no rush. It's a buyer's market and getting more so. Prices are still falling. She'll get a better deal a year from now.

2) DSL: "I don't see any price drops in any desirable San Gabriel valley suburb (San Marino, South Pasadena, or desirable areas of Pasadena and N. San Gabriel). Where is the huge price correction all of your readers keep yelling about?"
Pete: The huge price correction is in lower-income areas where there were lots of first-time buyers, sub-prime loans, and new construction. My guess is more established, upper-income neighborhoods with good schools and stable homeownership will continue to outperform the market -- but prices will slip eventually.

3) Nathan Wood: "Given the current housing market, do you think we could see from the peak to the bottom an 80 percent decrease in housing prices to more normative levels based upon workers earning power?"
Pete: No.

4) Wilson: "If a broad bailout is passed and every defaulting homeowner is given a principal reduction, would you join a growing movement of folks who will intentionally default on their mortgage in order to receive a principal reduction?"
Pete: No, but it makes sense that lots of homeowners would deliberately miss a few payments to get into a cheaper mortage. I wouldn't do it because I don't have a mortgage, and even if I did, my wife and I take our credit scores seriously.

5) D: "Break out your crystal ball Mr. Viles. How long do you think the downturn will last and how low will it go?"

Ask Pete

I spend my days and many nights bloviating here about things I think you need to know, and raising the questions I think need to be raised. It's all very command and control, if you think about it.

My boss, Tony Pierce, suggested I turn the tables for a few hours and let you ask the questions -- about real estate, the economy, the news media. You set the agenda. 

So here goes: Ask the blogger. Your questions, my answers.

Get those questions in by 4:30 p.m., and I'll answer them by 5:30 p.m.

Photo Credit: Warren Christopher's house in Beverly Hills (just listed for $3.25 million), by Bary Brooks.