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March 25, 2012

Carmel & Pebble Beach Real Estate News for Mar. 17th 2012

Filed under: Carmel-by-the-Sea Real Estate,Pebble Beach Real Estate,Real Estate Market Data — Tags: , , , , , , , , , — admin @ 8:00 am

Homes in Carmel are still outselling real estate in Pebble Beach. Overall the Carmel real estate market seems to be stable, if not growing. In total there were six new listings and two sales this week. The new listings for homes in Carmel are, a REO on Handley Dr. for $810K, on Camino Real for $1.45M, on San Mateo Ave. for $999,995, another REO on Morse Dr. for $823.5K, on Casanovo for $3.695M and on Ribera Rd. for $849K.

There were three new listing for Pebble Beach, on Congress Rd. for $1,349,500, on Stevenson Dr. for $1.249M, and on 17 Mile Dr. for $27M. The latter suggesting that the market for high end luxury homes may be recovering, especially with all the new wealth being generated in Silicon Valley.

There was one price increase in Pebble Beach on 17 Mile Dr. from $3.495M to $3.695M.

Ten homes decreased in price, continuing to prolong buyers believe that there is still room to offer less. In Carmel seven homes had a price decrease, on Aquajito Rd. from $3.495M to $2.95M, on Casanova from $3.9M to $3.495M, on Guadalupe from $1.095M to $889K, on Monte Verde & 12th from $1.289M to $1.149M, on Vizcaino & Mt. View from $1.049M to $995k, on Dolores & 10th from $2.2M to $1.795M and a REO on Handley Dr, from $835K to $810K. In Pebble Beach three homes had a price decrease, on Lookout Rd. from $849.9K to $833.9K, on Ronda Rd. from $3.9M to $3.499M, and on Vaquero Rd. from $987.5K to $895K.

To directly quote Louis Cammarosano, general manager of HomeGain, “home buyers and sellers continue to remain apart as to home valuations with the vast majority of home owners thinking their homes are worth more than their agents and the market are telling them.” Based on this it looks like there is still leeway for Home Buyers to negotiate on price, and buyers who offer cash are in a really strong bargaining position. Buyers with loans need to be pre qualified and ready to buy or risk a lower cash offer winning the sale.

This week there were two homes in Carmel that sold and two in Pebble Beach. In Carmel on Guadalupe for $667K after 114 Days on Market (DOM), and on 2nd for $525K after 32 DOM. The Pebble Beach Real Estate sales were on Hermitage Rd. for $1,042,500 after 492 DOM, and on El Bosque Dr. for $475K after 321 DOM.

For a larger picture of sales of homes in Carmel, 66 homes have sold in the last 120 days (11/18/11 to 3/17/12). Ranging from $8,100,000 for a home on Scenic & 8th to $323,000 for a REO on Mission & 4th. Average DOM is 135 days and average $/sqft is $560. 39 homes in Carmel were $1M or under and 35 of these homes were west of Highway 1.

March 24, 2012

IRS Tax Deduction Rules for Refinancing Homes.

Filed under: Carmel-by-the-Sea Real Estate,General,Homes in Carmel,Pebble Beach Real Estate — Tags: , , , , , , , , , — admin @ 1:39 pm

Carmel Real Estate is always in high demand and attracts both cash and loan buyers. In addition lots of homes in Carmel have been refinanced lately to take advantage of the low interest rates and if you are thinking about refinancing your home mortgages, you need to know the IRS tax-deduction rules.

If you decide to borrow more than you owe on your existing mortgage don’t assume you can write off interest on the whole new loan, because in many cases you can’t.

Homeowners generally are entitled to interest deductions on whatever amount was left on the original mortgage. Whether you can deduct interest on the excess depends on several factors, including the amount of extra money you have borrowed and how you plan to use it. Risk getting it wrong and homeowners could find themselves the subject of an Internal Revenue Service audit.

Judith D. Ludwig, an adviser at Braver Wealth Management LLC in Needham, recalls how one client was audited after he took on a $400,000 mortgage in refinancing a home on which he owed $200,000 and tried to deduct interest on the whole new amount.

With interest rates unusually low, financial advisers say they are fielding lots of calls from clients asking if it makes sense to refinance. Limits on the tax deduction, they say, can be a deal breaker for clients thinking about increasing the size of their mortgage.

“Once I tell them they can’t write it all off, nine times out of 10, people say “I’m not going to take more than what’s owed on the mortgage,’” says Robert J. DiQuollo, founder and principal of Brinton Eaton, a fee-only adviser in Madison, N.J., with about $650 million under management.

Many people, he says, just don’t understand how the deduction works. Sometimes, he says, they get confused by jargon—the rules, for example, use the term “home-equity loan” for debt that doesn’t have to be used to improve a home.

The rules most in play now apply to mortgages taken out after Oct. 13, 1987. They let a homeowner deduct interest on up to $1 million of acquisition debt—that is, money used to buy, construct or improve a residence or second home—and on another $100,000 of home-equity debt, which can be used for any purpose. (The interest on home-equity debt isn’t deductible, however, when it comes to determining alternative-minimum tax income.)

The IRS has been looking closely at people with expensive homes, scrutinizing mortgage-interest deductions taken for some homes valued at $1 million or more. David A. Lifson, a certified public accountant at Crowe Horwath LLP in New York, says some clients last year were caught up in “mini-audits,” and he predicts more of the same for 2012.

Renée Kwok, president of TFC Financial Management in Boston, says clients often draw down their home-equity credit lines and assume any interest expense is deductible.

“The bottom line,” says Ms. Kwok, “is that mortgage interest is probably over-deducted on many federal income-tax returns due to the complexity of the deduction rules, and the IRS probably has a legitimate beef on this count.”

March 18, 2012

Carmel & Pebble Beach Real Estate News for Mar. 10th 2012

Filed under: Carmel-by-the-Sea Real Estate,Homes in Carmel,Pebble Beach Real Estate,Real Estate Market Data — Tags: , , , , , , , , , — admin @ 8:54 am

Monthly home sales and median price data don’t tell the full picture about the real estate market in Carmel or Pebble Beach.
To help you get a better understanding of market performance we publish this weekly summary of luxury real estate transactions for Carmel and Pebble Beach.

Homes in Carmel are still outselling real estate in Pebble Beach. Overall the Carmel real estate market seems to be stable, if not growing. In total there were five new listings and six sales this week. The new listings for homes in Carmel are, on Guadalupe & 7th for $1.075M, on Junipero & 12th for $514.9K, on 6th Ave. for $632.9K, on Upper Trails for $780K, on Handley Dr. for $835K.

There were six new listing for Pebble Beach, two on 17 Mile Dr. one for $4.25M, and one for $3.695M, on Crespi Ln. for $12.5m, and two on Sloat Rd. one for $699K and one for $2.7M, and on Congress Rd. for $1,349,500.

There was one price increase in Pebble Beach on 17 Mile Dr. from $3.495M to $3.695M.

Eight homes decreased in price, continuing to prolong buyers believe that there is still room to offer less. In Carmel four homes had a price decrease, on Aquajito Rd. from $1.995M to $1.85M, on Flanders Dr. from $899K to $825K, on 1st & Carpenter from $798K to $768K, on Vizcaino & Mt. View from $1.05M to $999K. In Pebble Beach four homes had a price decrease, on Trapper Trail from $2.15M to $1.9M, on Lookout Rd. from $849.9K to $835.9K, on San Carlos from $1.15M to $1.09M and on Sloat Rd. from $895K to $825K.

To directly quote Louis Cammarosano, general manager of HomeGain, “home buyers and sellers continue to remain apart as to home valuations with the vast majority of home owners thinking their homes are worth more than their agents and the market are telling them.” Based on this it looks like there is still leeway for Home Buyers to negotiate on price, and buyers who offer cash are in a really strong bargaining position. Buyers with loans need to be pre qualified and ready to buy or risk a lower cash offer winning the sale.

This week there were six homes in Carmel that sold and two in Pebble Beach. In Carmel on Randal Way for $3.025M after 280 Days on Market (DOM), on Hatton Rd. for $2M after 124 DOM, on Santa Fe & 5th for $505K after 10 DOM, on Oak Pl. for $480K after 19 DOM, on Pradera Rd. for $3.85M after 15 DOM, and on San Carlos & 3rd for $1.595M after 245 DOM. The Pebble Beach Real Estate sales were on Wranglers Trail for $1.028M after 513 DOM, and on El Bosque Dr. after 2 DOM.

For a larger picture of sales of homes in Carmel, 65 homes have sold in the last 120 days (11/11/11 to 3/10/12). Ranging from $8,100,000 for a home on Scenic & 8th to $323,000 for a REO on Mission & 4th. Average DOM is 132 days and average $/sq.ft is $587. 36 homes in Carmel were $1M or under and 31 of these homes were west of Highway 1.

March 11, 2012

Carmel & Pebble Beach Real Estate News for Mar. 3rd 2012

Filed under: Carmel-by-the-Sea Real Estate,Homes in Carmel,Pebble Beach Real Estate,Real Estate Market Data — Tags: , , , , , , , , , — admin @ 4:13 pm

Monthly home sales and median price data don’t tell the full picture about the real estate market in Carmel or Pebble Beach.
To help you get a better understanding of market performance we publish this weekly summary of luxury real estate transactions for Carmel and Pebble Beach.

Homes in Carmel are still outselling real estate in Pebble Beach. Overall the Carmel real estate market seems to be stable, if not growing. In total there were eleven new listings and six sales this week. The new listings for homes in Carmel are, on 8th & Casanova for $2.450M, on Mission & 12th for $1.840M, on Monte Verde & 13th for $3.195M, on Carmel Riviera Dr. for $1.495M, on Yankee Beach Way for $2.498M, on Dolores for $2.795M, on Camino Real & 12th for $1.295M, a REO on Torres & 8th for $2.75M, on 15th Ave. for $1.49M, on Monte Verde & 7th for $1.05M, and finally on Ocean Ave. for $5.5M.

Returning to normal after the rush for the AT&T there were three new listing for Pebble Beach, on Forest Way for $899K, on Ronda Rd. for $3.9M, on Porque Ln. for $2.595M.

There were no price increases in either Carmel or Pebble Beach..

Eleven homes decreased in price, continuing to fuel buyers believe that there is still bargains to be had. In Carmel five homes had a price decrease, on Carmelo & 12th from $1.588M to $1.35M, on Lower Trails from $1.095M to $1.098M (according to MLS!), on Atherton Dr. from $1.175M to $895K, on Casanova & 2nd from $1.695M to $1.599M, and finally on Casanova & 8th from $1.395M to $1.295M. In Pebble Beach six homes had a price decrease, on Viscanio Rd. from $3.9M to $2.4M, on Arroyo Rd. from $950K to $795K, on Lopez Rd. form $1.199M to $1.179M, on 17 Mile Dr. from $2.495M to $2.295M, on Lookout Rd. from $849,900 to $837,900, on Vaquero Rd. from $987.5K to $875k.

To directly quote Louis Cammarosano, general manager of HomeGain, “home buyers and sellers continue to remain apart as to home valuations with the vast majority of home owners thinking their homes are worth more than their agents and the market are telling them.” Based on this it looks like there is still leeway for Home Buyers to negotiate on price, and buyers who offer cash are in a really strong bargaining position. Buyers with loans need to be pre qualified and ready to buy or risk a lower cash offer winning the sale.

This week there were six homes in Carmel that sold and three in Pebble Beach. In Carmel on 14th Ave. for $2.7M after 325 Days on Market (DOM), on Fisher Pl. for $548K after 127 DOM, on Monte Verde & 13th for $1.15M after 91 DOM, an REO on Ribera Rd. for $795K after 360 DOM, on Palou Rd. for $1.65M after 360 DOM, and finally on Santa Fe & 5th for $640K after 7 DOM. The Pebble Beach Real Estate sales were on Larkin Rd. for $535K after 14 DOM, on Bird Rock Rd. for $2.125M after 83 DOM, and finally on Rodeo Rd. for $4.25M after 10 DOM. Pretty short Days on Market for Pebble Beach, a good sign that maybe homes are now moving.

For a larger picture of sales of homes in Carmel, 62 homes have sold in the last 120 days (11/04/11 to 3/03/12). Ranging from $8,100,000 for a home on Scenic & 8th to $323,000 for a REO on Mission & 4th. Average DOM is 138 days and average $/sqft is $600. 37 homes in Carmel were $1M or under and 35 of these homes were west of Highway 1.

March 2, 2012

Carmel & Pebble Beach Real Estate News for Feb, 18th 2012

Filed under: Carmel-by-the-Sea Real Estate,Homes in Carmel,Pebble Beach Real Estate,Real Estate Market Data — Tags: , , , , , , , , , — admin @ 9:05 am

Homes in Carmel are still outselling real estate in Pebble Beach. Overall the Carmel real estate market seems to be stable. In total there were five new listings and four sales this week. The first three listings for homes in Carmel are, on Camino Real & 11th for $1.995M, on San Lucas Rd. $999K, on Tolando Trails for $1.175M. The final two properties are, on Santa Rita & 1st for $675K and on Yankee Point Dr. for $5.995M. This last home has spectacular 180 degree white water views.

After last weeks push for the AT&T there were only three new listings for Pebble Beach, on Arrowhead Rd. for $740K, on Stevenson Dr. for $1.995M, and on Sloat Rd. for $895K. The AT&T did seem to drive considerable interest in the Open Houses and hopefully this will turn into sales.

Six homes decreased in price, continuing to fuel buyers believe that there is still bargains to be had. In Carmel three homes had a price decrease, on Greenfield Pl. from $1.7 to $1.5M, on Lazarro Dr. from $1.05M to $825K, and on Santa Rita & 3rd from $829K to $809K. The remaining three homes were in Pebble Beach, on Padre Ln. from $2.395M to $2.095M, on San Carlos Rd. from $1.699M to $1.625M and on Vaquero Rd. from $987K to $895K.

To directly quote Louis Cammarosano, general manager of HomeGain, “home buyers and sellers continue to remain apart as to home valuations with the vast majority of home owners thinking their homes are worth more than their agents and the market are telling them.” Based on this it looks like there is still leeway for Home Buyers to negotiate on price, and buyers who offer cash are in a really strong bargaining position. Buyers with loans need to be pre qualified and ready to buy or risk a lower cash offer winning the sale.

This week there were four homes in Carmel that sold and two in Pebble Beach. In Carmel a home on Rio Vista Dr. for $1.1M after 172 DOM (Days on Market), on Flander Pl. for $470.25K after 20 DOM, on Carmelo & 10th for $1.3M after 41 DOM, on Camino Real & 8th for $1,999,688 after 4 DOM. Reflecting that Carmel real estate can sell quickly when priced correctly. The Pebble Beach Real Estate sales were on 17 Mile Dr. for $2.675M after 200 DOM, and an REO on Oasis Dr.. for $1.371M after 3 DOM. A mix of short and long days on the market.

For a larger picture of sales of homes in Carmel, 65 homes have sold in the last 120 days (10/21/11 to 2/18/12). Ranging from $8,100,000 for a home on Scenic & 8th to $323,000 for a REO on Mission & 4th. 39 homes in Carmel were $1M or under and all of these homes were west of Highway 1.

March 1, 2012

Warren Buffett would buy…

Filed under: General,Homes in Carmel,Pebble Beach Real Estate,Real Estate Market Data — Tags: , , , , , , , , , — admin @ 9:57 pm

Warren Buffett, the billionaire investor and Berkshire Hathaway CEO, said on CNBC’s “Squawk Box” recently that he’d “buy up a couple hundred thousand” single-family homes if it was practical.

Buffett said that’s because he believes purchasing a home with ultra-low mortgage rates and holding it for the long-term has become a better investment than stocks right now.

“Housing will come back, you can be sure of that,” Buffett wrote in his annual letter to shareholders recently.

Buffett forecasts an increase in household formations, as more people who moved in with their parents or family members during the recession look to move out and get their own home soon.

“People may postpone hitching up during uncertain times, but eventually hormones take over. And while ‘doubling-up” may be the initial reaction of some during a recession, living with in-laws can quickly lose its allure,” Buffett said.

Buffett said the recovery in the housing market could vary quite a bit among local housing markets, however. He did not provide a timeline of when he expected a full housing recovery, admitting that his prediction last year that a housing recovery will take shape within the year turned out to be “dead wrong.”

Source: “Housing Market Forecast Beyond 2012 From Warren Buffet,” International Business Times (Feb. 28, 2012) and “Warren Buffet on CNBC: I’d Buy Up ‘A Couple Hundred Thousand’ Single-Family Homes If I Could,” CNBC (Feb. 27, 2012)

Is now the time to buy Real Estate in Carmel or Pebble Beach?

Filed under: General,Homes in Carmel,Pebble Beach Real Estate,Real Estate Market Data,Uncategorized — Tags: , , , , , , , , , — admin @ 9:39 pm

If you are sitting on the fence about buying Carmel & Pebble Beach Real Estate then perhaps these words from Warren Buffett will help you make up your mind. The so-called Oracle of Omaha, Warren Buffet forecast for real estate in 2012 and beyond is extremely rosy. He recommends buying homes over investing in a diversified group of leading companies.

In an interview with CNBC on Monday, Buffett said single-family homes, along with stocks, are cheap and attractive investments. By contrast, investments in Treasury bills, gold or simply keeping money in cash are not as attractive.

Buffett said if he had a way to buy “a couple hundred thousand single-family homes” and easily manage them, he would “load up on them” and “take mortgages out at very, very low rates.”

However, he said that managing “a couple hundred thousand single-family homes” is an impossibly Herculean logistical task.

This line of reasoning likely holds true for many brilliant investment minds who choose not to bother with buying single-family homes — even though they are undervalued — when buying and owning stocks is as easy as a few keystrokes and mouse clicks on a computer.

Because of the absence of many of these big institutional investors in the U.S. residential real estate market, it is less competitive than the stock market, Buffett said. When institutional investors of size do enter the residential real estate market, they usually go for apartment buildings, leaving the single-family homes segment even less competitive than the general residential real estate market.

When asked if a young individual investor should buy stocks or his first single-family home, Buffett recommended buying a single-family home with a 30-year mortgage.

“It’s a terrific deal,” he said. “It’s a leveraged way of owning a very cheap asset now and I think that’s probably as an attractive an investment as you can make now.”

In fact, if the young individual investor is “a handy type,” he could “buy a couple of them at distressed prices and find renters,” said Buffett.

Buffett is famous for only investing in assets he believes are undervalued. He must, therefore, believe that the U.S. residential real estate market is undervalued.

One valuation metric for residential properties is the price-to-rent (P/R) ratio, which roughly corresponds to the price-to-earnings (P/E) ratio for stocks.

As seen on the chart below, the rent-to-earnings ratio has fallen to 2004 levels.

Purchase to Rent Ratio

Data from U.S. Census Bureau, chart made using Microsoft Excel

Moreover, as the economy recovers, both rent and housing prices should rise as well.

A perhaps even better argument that the real estate market is historically cheap, however, is that mortgage rates are at or near the historic low.

Mortgage rates are a huge driving factor of the ultimate cost of purchasing a home.

For example, the total interest expense of a $200,000, 30-year fixed-rate mortgage at a 4 percent mortgage rate, which is the current rate, is $144,000. At 10 percent, which was the prevalent rate in 1990, interest expense comes to $432,000.

All this makes buying a home in Carmel a strategic investment for the future.