Freddie Mac: 30-year mortgage rate ties record low

The average interest rate on a 30-year fixed-rate mortgage dropped again this week to 3.94%, tying a record low set in October, according to housing finance giant Freddie Mac.

Freddie Mac's weekly survey pegged the rate for a 15-year fixed-rate mortgage at a record low of 3.21%. Loans fixed for five years before becoming adjustable also set a new record, with an average start rate of 2.86%

The survey, released each Thursday, asks lenders to report rates they are offering to well-qualified borrowers who pay about 0.75 of a percentage point in upfront lender fees and discount points. The rates are for loans of up to $417,000.

Freddie has conducted the survey of 30-year loans since 1971, 15-year loans since 1991, and five-year adjustable hybrids since 2005.

The record lows have touched off the latest surge in home refinancing. But while sales of homes increased slightly in California last month, scheduled foreclosure sales have risen sharply and the environment for housing remains rough overall, as Freddie Mac's chief economist, Frank Nothaft, pointed out in announcing the latest survey results.

"In its Dec. 13 monetary policy announcement, the Federal Reserve reiterated the housing market remains depressed," Nothaft wrote. "Over the first nine months of 2012, households lost almost $400 billion in property values, which contributed to a $1.4 trillion reduction in overall net worth.

"In addition, serious delinquency rates (90 or more days delinquent plus foreclosures) on mortgages increased slightly between June 30 and Sept. 30 of the year, breaking a six-quarter consecutive decline, according to the Mortgage Bankers Association.”

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 Photo: Freddie Mac's headquarters in Virginia. Credit: Pablo Martinez Monsivais / Associated Press

California's home sales up 4% in November

California's housing market showed some signs of luster in November with sales picking up over the same month last year, but prices declined and foreclosures remained prevalent.

Sales fell 4.2% from October, although they commonly decline from October to November, and compared with November 2010, they were up 4%, according to real estate research firm DataQuick. A total of 32,669 homes sold last month, which is about 18% below the average for November since 1988, when DataQuick's statistics begin.

The state's median home price was $244,000, up 1.7% from October and down 4.3% from November 2010.

“These days, buyers and sellers have to contend with two sets of problems, which sometimes play into each other and sometimes conflict with each other," DataQuick President John Walsh said in a statement. "The first is the lousy economy and the opportunities it presents, for better or worse. The second is the dysfunctional mortgage-finance system. Interest rates may be at record lows, but the types of mortgages that are available have been drastically reduced and qualifying is a true grind.”

The state's median price, which is the point at which half the homes in the state sold for more and half for less, has declined year-over-year for 14 consecutive months. The most recent low in the median was hit in April 2009, at the height of the financial crisis. After that, the housing market began showing some signs of strength as a tax credit mostly aimed at first-time buyers helped fuel a buying spree. The market has been weak ever since that credit expired in April 2010.

Foreclosures are a big part of that weakness, as those homes and other so-called distressed properties tend to sell at a discount. Of the previously owned homes that sold last month, about 1 in 3 were foreclosures and about 1 in 5 were short sales, in which the home is sold for less than the outstanding debt on the property.

In Southern California, sales rose 0.3% from October and 4.2% from November 2010 with 16,884 homes bought across the six-county region. The median home price for the region was $275,000 in November, up 1.9% from October but down 4.2% from November 2010.

The Bay Area's housing market picked up a bit of steam last month. A total of 6,317 homes sold in the nine-county region, down 2.0% from October and up 3.4% from November 2010. The Bay Area's median home price was $363,500, up 3.9% from October and down 4.3% from November 2010.

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Photo: For-sale signs in Palo Alto. Credit: Paul Sakuma / Associated Press

Southern California home sales increase in November with low prices

Low prices for starter homes spurred some bargain hunting among home shoppers in Southern California last month, sending sales up slightly over last year. But higher-priced neighborhoods did not fare as well.

Overall, November sales were up 0.3% from October and 4.3% from November 2010 with 16,884 homes bought across the region, according to real estate research firm DataQuick of San Diego. Sales of newly built homes continued to suffer, declining 15.2% from the same period a year earlier, falling to the lowest level on record for a November.

The median home price for the region was $275,000 in November, up 1.9% from October but down 4.2% from November. The median is the price at which half the homes sold for more and half for less. It is heavily influenced by changes in the type of homes selling.

Short sales and foreclosures accounted for 51.3% of the market last month, DataQuick said.

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Photo: A sign showing a property for sale. Credit: Images_of_Money via Flickr 

Stalled Hollywood condo project reborn as luxury rentals

A failed Hollywood condominium development that once symbolized the housing market collapse has been reborn as a $120-million upscale apartment and retail complex.

Construction on the former Madrone came to a halt around the end of 2009 even though the shell of the project was mostly complete. Developer John Laing Homes filed for bankruptcy and the scaffolding-swathed husk of the Madrone was left to weather the elements behind locked gates.

One of the original investors in the project, Resmark Cos., took over and restarted work in July 2010 on what is now known as the Avenue. The just-completed complex on La Brea Avenue south of Hollywood Boulevard has 180 units in three buildings connected around a raised courtyard.

Several housing developments intended to be condominiums before the housing bust have been converted to apartments, but Resmark took the unusual step of making the Avenue’s rental units more luxurious than the Madrone condos were intended to be, Chief Executive Robert N. Goodman said.

Among the improvements are more expensive built-in appliances, interior finishes such as floor tiles and a grander lobby. Rents will be in the range of many mortgages: One-bedroom units start at $2,750 a month, reach $4,900 for three bedrooms and hit $9,000 for a penthouse.

“We expect to rent to younger, affluent professionals who are making a lifestyle choice and prefer to be a renter and not a buyer,” Goodman said.

Tenants for the ground-floor retail spaces have not been signed yet, he said, but Resmark hopes to land businesses such as a restaurant and a coffee bar that would appeal to residents.

John Laing Homes took a substantial loss on the project, Goodman said. Resmark took over the construction loan “at a fairly significant discount,” he said, and will end up spending $80 million on the project that took a total of $120 million to complete. The California Public Employees' Retirement System is also an investor.

The Avenue has a fitness center, pool, fire pit, concierge and a residents-only dog run.

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Photo:  The Avenue apartment complex in Hollywood.  Credit: Francine Orr / Los Angeles Times

With mortgages at 4%, demand for home-purchase loans rises

With 30-year mortgage rates still averaging a rock-bottom 4%, applications to purchase homes rose after Thanksgiving to the highest level in four months.

Freddie Mac's weekly report on home lender offerings, released Thursday, showed the typical rate for a 30-year loan at 3.99%, the sixth straight week at or slightly below 4%.  Last year at this time, the 30-year fixed loan averaged 4.61%.

Fifteen-year fixed-rate home loans, a popular option for people refinancing homes, averaged 3.27%, down from last week's 3.3%. A year ago, the 15-year loan averaged 3.96%, Freddie Mac said.

The big government-backed mortgage buyer asks lenders what rates they are offering to borrowers with good credit and 20% down payments or 20% equity if they are refinancing. The rates are for loans of up to $417,500 with the borrowers paying about 0.75% of the loan amount in lender fees and points.

The typical mortgage rate for larger "jumbo" loans was running about a third of a percentage point higher, according to another report this week, this one from the Mortgage Bankers Assn. Jumbo loans are priced higher because lenders can't sell them to Freddie Mac and Fannie Mae, the other big government-sponsored mortgage buyer. 

Offering a bit of hope for housing at a time when foreclosures are drawing angry protests and government investigations, the mortgage bankers said applications for loans to buy houses reached the highest level since early August.

Refinances still made up about three-quarters of all applications for home loans, however.

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Photo: Occupy LA protests a foreclosure auction in Norwalk. Credit: Genaro Molina /Los Angeles Times

Molina Healthcare buys Long Beach offices for $81 million

One of Long Beach’s premier office complexes has been sold for $81 million to Molina Healthcare Inc., the property’s largest tenant.

Molina Healthcare bought two connected 14-story buildings at 200 and 300 Oceangate in the city’s central business district. It was largest office sale in Long Beach since the real estate peak of 2007, said real estate broker Kevin Shannon of CBRE Group Inc.

The brokerage represented the seller, the Swig Co. San Francisco-based Swig had owned the property, formerly known as Arco Center, since 1986.

Molina Healthcare's headquarters occupies about one-third of the 461,263-square-feet complex that lies between Ocean Boulevard and Shoreline Drive, across the street from the Long Beach World Trade Center, Shannon said.

It is more than 90% occupied by such tenants as the California State Lands Commission and California Marine And Intermodal Transportation System Advisory Council, according to real estate data provider CoStar.

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Photo: Office buildings at 200 and 300 Oceangate in Long Beach.  Credit: Charlie Lenoir

Ramsey-Shilling property brokerage bought by Avison Young

Prominent Los Angeles property brokerage Ramsey-Shilling Commercial Real Estate Services Inc. has been bought by Avison Young, Canada’s largest independent commercial real estate services company.

Avison Young plans to acquire more Southern California brokerages and other real estate companies in the U.S. in the months ahead, Managing Director Neil Resnick said. Resnick, a broker formerly with Grubb & Ellis, opened Avison Young’s first Los Angeles office in August.

The acquisition of Ramsey-Shilling for an undisclosed amount added 23 employees, including 18 brokers. Over the past three years, Avison Young has grown from 11 to 26 offices including 11 in the United States, Resnick said. It has more than 900 employees.

“This is the beginning of what will be many” more branches, he said. “We are actively looking at other brokerages and individuals to join us.”

Ramsey-Shilling has had a high profile in Hollywood, where its brokers negotiated such deals in recent years as the sale and lease of the landmark Capitol Record building and the sales of the former ABC Studios, El Capitan office building, Palladium night club and the former Frederick’s of Hollywood building.

Other sales brokered by Ramsey-Shilling include the Rox-San office building in Beverly Hills and the Omni Saigon Hotel in Ho Chi Minh City, Vietnam.

“The vision for Avison Young is to have Southern California be one of its biggest and most important markets, if not its single most important market,” said Christopher Bonbright, who was chief executive of Ramsey-Shilling and is now an Avison Young principal. “We want to be absolutely competitive” representing landlords and tenants.

Being part of a larger organization should help land clients, Bonbright said, because Ramsey-Shilling sometimes lost jobs to large international firms such as CBRE Group Inc. and Jones Lang LaSalle.

Other former Ramsey-Shilling brokers joining Avison Young as principals are Mark Evanoff, John Tronson and Michael Dettling.

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Photo: Christopher Bonbright, left, and Neil Resnick of Avison Young. Credit: Richard Friedman

 

Mosaic Apartments to open in L.A.'s Pico Union district

Mosaic Apartments, a $21-million affordable housing project in the historic Pico Union area of Los Angeles, is set to open Thursday.

The 56-unit complex west of Staples Center near the intersection of Pico Boulevard and Union Avenue was developed by Amcal Multihousing Inc. of Agoura Hills to house low- to moderate-income renters.

The rapidly changing neighborhood is experiencing new interest from developers due to substantial commercial and residential growth in the adjacent South Park district and attractions such as L.A. Live, said Percival Vaz, chief executive of Amcal.

The design of Mosaic’s two three-story buildings is intended to complement the neighborhood’s historic housing created in the late 19th century and early 20th century — Craftsman, Queen Anne and American Foursquare homes — said architect Wade Killefer of Killefer Flammang Architects.

The project is divided by a long linear court. There are three smaller courtyards, one including playground equipment for youngsters who live at the development. Each building has a community room.

There is underground parking and ground-floor spaces for stores along Pico Boulevard.

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Photo: Mosaic Apartments.  Credit: Killefer Flammang Architects

 

Ask Laz: Settling disagreements over inherited property [Video]

Death can sometimes lead to a house divided.

So is the case for KTLA-TV viewer Don, whose sister died and left her house to him, his brother and their mother.

They don't agree about what to do with the property. He wants to rent it out and his brother and mom want to use it as a family getaway.

Can he sell his third to them -- and what if they don't want to buy it? 

Los Angeles Times consumer columnist David Lazarus says Don has some options. Among them is to file in court a petition for partition. David explains what that entails in the video below. 

 

You can catch him on KTLA (Channel 5) weekday mornings and during the 1 p.m. newscast. 

If you have a question, write or send a video to asklaz@ktla.com. He just might tackle your issue on television.

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California, Nevada team up to investigate foreclosure fraud

California and Nevada, two states at the heart of the nation’s housing crisis, will join forces to investigate allegations of foreclosure fraud and other types of mortgage improprieties.

The agreement to share resources and work jointly is the latest sign that the nation’s state attorneys general want to be out front in cracking down on bank practices the housing crisis — from the selling of mortgage-backed securities to the handling of foreclosures.

At a joint news conference in Los Angeles on Tuesday, California Atty. Gen. Kamala D. Harris and Nevada Atty Gen. Catherine Cortez Masto said their offices would share litigation strategies and evidence would link their offices' civil and criminal teams.

The announcement comes less than a week after Massachusetts said it was suing the nation’s five largest mortgage servicers over alleged foreclosure illegalities. The move marked the first such litigation to be filed by a state.

Harris' office has opened a number of its own probes of the mortgage business. Investigators have subpoenaed information from Fannie Mae and Freddie Mac as part of a wide-ranging inquiry into lending and foreclosure practices in the state, The Times has previously reported. Her office also is investigating Bank of America and its mortgage arm Countrywide Financial, along with Citibank, seeking information on their sale of mortgaged-backed securities in California.

The new alliance between Harris and Masto comes as banks are working to strike a deal with a coalition of attorneys general who are working to seek relief for consumers allegedly wronged by faulty mortgage servicing and foreclosure practices.

Harris formally withdrew from those talks earlier this year. Masto has said Nevada officials would evaluate any proposal the talks might produce but would also push ahead with their own work. New York, Delaware, Kentucky and Minnesota also have signaled they are unhappy with the direction of the talks with the banks. All of those states have expressed concern that the banks could be let off too easily.

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Photo: California Atty. Gen. Kamala D. Harris. Credit: Brian van der Brug/Los Angeles Times

Phoenix Realty buys Long Beach apartment complex

New York investment firm Phoenix Realty Group bought a Long Beach apartment complex last month for $34.5 million, the latest in a string of acquisitions targeting Southern California residential properties.

Since December 2010, Phoenix Realty has spent $228 million to acquire and improve 11 apartment complexes in the region. Most of them were in Riverside and San Bernardino counties, where company executives expect to see growing demand from renters even though the Inland Empire was hit hard in the economic downturn.

“We try to find the areas that get under-looked,” Managing Director Edward Ratinoff said. “When Southern California comes back, the Inland Empire will get its fair share of growth.”

Phoenix Realty focuses on buying what it calls workforce housing, or apartments serving workers with blue-collar or lower-paying white-collar jobs, he said. The buildings are generally full, but have the potential to generate higher rents after improvements such as updated kitchens are made.

The company’s new Long Beach property is called the Crossings at the Bay, which Phoenix Realty acquired from BPG Properties of Philadelphia. Los Angeles asset manager New Standard Equities, which helped put the deal together, will oversee improvements to the Crossings at the Bay and operate the 237-unit complex that was built in 1963.

Apartments are on the upswing, Ratinoff said. Landlords are reducing concessions such as free parking intended to attract tenants and raising rents in some neighborhoods. “We believe the market has turned,” he said.

Tenants are remaining renters for longer than they previously did, said real estate broker Dean Zander of Hendricks & Partners.

“More renters are entering the market every day,” Zander said, as so-called echo boomers enter the job market and people who doubled up with family and friends during the recession strike out on their own. Many young people lack the ability or desire to buy a home and rents are still often cheaper than mortgage payments, he said.

Phoenix Realty also recently completed the $36.4-million acquisition of Canyon Creek, a 288-unit apartment complex in Riverside.

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-- Roger Vincent

Photo: The Crossings at the Bay apartments in Long Beach.  Credit: BPG Properties