Luxury real estate in Newport Beach, Laguna Beach, Corona Del Mar, and greater Orange County is impressive, extravagant, and, of course, expensive. That should come as no surprise; it’s right there in the name! Luxury is defined as “conducive to sumptuous living, usually a delicacy, elegance, or refinement of living rather than a necessity.” But even if you’ve got the cash to buy a sprawling, lavish estate, there is more than the listing price to keep in mind. In this article, we’ll cover some of the hidden costs of owning a luxury home.
While you may have the resources to buy a luxury home, it’s important to be aware of externalities. Much like starting a family, it’s only prudent to be prepared before shouldering a new bundle of responsibilities. As your trusted real estate advisers, a crucial part of our job is to ensure that you’re as informed as possible. So let’s explore some examples of the expenses that come with buying a luxury home.
Sixteen years ago, rap artist and former beverage mogul Curtis James Jackson III, aka 50 Cent (Fiddy), purchased a grand Connecticut estate. Nestled 80 miles north of the wealthy town of Greenwich near NYC, the residence at 50 Poplar Hill Drive boasts 52 rooms across 50,000 square feet. Some of the property’s opulent features include a nightclub, two private pools, both indoor and outdoor basketball courts, and a recording studio (naturally). The home is larger than others in the area, which didn’t help when it was later listed for sale.
Fiddy bought the estate in 2003 from another famous face, one Mike Tyson of boxing fame. The sale price then was $4.1 million. After a few years of owning the property, Fiddy listed the home for sale at $18.5 in 2007. At such a dramatically increased price, the listing did not sell and was taken off the market. By 2015, Fiddy again listed the home for sale. This time, the price was $4.995 million, but again the home did not garner the asking price. Finally, he sold the property in 2019 for $2.9 million to Florida businessman, Casey Askar. That’s an 84% price drop from his 2007 asking price of $18.5 million.
Such a drastic decrease begs the question: Why did Fiddy sell? The answer is in the hidden costs. Reportedly upwards of $70,000 each month, the upkeep and maintenance costs of the lavish estate were simply too much for Fiddy to handle. From the 50,000 sq ft of 52 rooms, to the lawns and the pools, the estate at 50 Poplar Hill Drive required constant effort from groundskeepers and staff. Not to mention utility bills to keep the residence warm throughout the winter, or cool in the summer. In just five years, that monthly cost would add up to the total that Fiddy paid for the original sale, and he could no longer justify the expense.
If you’ve watched the popular period drama Downton Abbey, then you are one step ahead of ol’ 50 Cent in knowing that running a palatial estate is a team affair. There’s the estate manager, the household manager, the butler, the chef, the cooks, the gardener, the gameskeeper, the stewardess, the chauffeur, the parlormaid, the chambermaid, housemaid, laundrymaid—the list goes on. But while the costs are steep, they do come with perks: keep your house in order and you may even be graced by a visit from the Queen!
In all seriousness, your home need not be a sprawling estate to be considered “luxury.” In the simplest sense, a luxury home is one that is valued well above the average in a given market. In many US cities and metro areas, a price of $1 million is often considered the starting point for luxury homes. In markets like San Francisco and New York, where prices are substantially higher than the national average, luxury is said to start around $4 million.
On the bright side, you do get more for the higher price tag. Luxury homes, whether a charming San Francisco Victorian or a giant midwest mansion, tend to come with more square footage and fancier features than the average home. But of course, there’s a hidden cost there, too. For a large luxury property, simple tasks like cleaning your gutters or mowing the lawn become a considerable expense. Want to upgrade to smart devices and appliances? It’ll cost a pretty penny to do so across your whole home. While you may have the money to cover these additional expenses, it’s important to be aware of them when planning your home purchase.
Let’s take a look at another famously fancy luxury home with hidden costs. When Yuri Millner, a Russian-born tech investor, bought his Silicon Valley home in 2011, the sale price of $100 million broke records in California and Santa Clara County. The Bay Area estate sits on 11 acres with structures of roughly 25,000 square feet, and includes a ballroom, a theater, a spa and a gym.
Interestingly, the taxable assessed value of the home has marked around $50 million by the Santa Clara County Assessor, just half as much as Milner paid. Yet that still means Yuri is on the hook to pay over $600,000 each year in property taxes. If Yuri has a mortgage, his payments will be whoppers as well. If he financed the home using a standard 30-year fixed conventional loan with 20% down and $80,000,000 in principal, his monthly payments would total nearly $400,000.
Of course, a Russian oligarch or any other billionaire likely is not concerned with middling expenses in the mere hundreds of thousands. But the fact remains that, as a home price grows, so too do its associated costs. Getting insurance for a $100 million home is nigh impossible, but insurance on a $5 or 10 million home is just plain expensive. From the tax man to your loan officer, you’ll be paying the pipers by the truckload.
Home ownership always comes with additional costs. But despite the increased expenses, buying a luxury property in Newport Beach, Laguna Beach, or Corona Del Mar can be incredibly rewarding. The stunning views, the lavish spaces, the fixtures and finishes each provide a magnificent setting for your modern lifestyle. We love matching our clients with the perfect home to fit their tastes and their budget. If you’re looking to buy or sell a luxury property, get in touch to start the no-pressure conversation and explore your options.
As the largest adult population group in the US, millennials wield $1.4 trillion in purchasing power, and more of them are aging and earning their way into the real estate market.
If you explored Twitter recently, you’d get the feeling that intergenerational squabbling has reached new heights. In a flurry of contentious posts, the trending “OK boomer” meme has highlighted the divide between millennials and baby boomers. Even cultural icons like William Shatner have joined the fray.
However, despite the often-strained, less-than-cordial relations relations between the two age groups, it is increasingly apparent that both sides agree on at least one thing: Just like their elders, millennials see home ownership as an essential part of the American experience.
Like any market, real estate is driven by supply and demand, and demand is strong among millennials. One 2018 study found that a whopping 9 out of 10 millennials are interested in purchasing a home. The same study showed that those millennials intend to act on that interest, albeit with some variance in their expected timelines.
Of millennials who plan to buy a home, just 4% expect to buy in the next year, while a whopping 85% want to buy at some point in the next 2 or more years. If economic conditions allow, we can expect to see many more homeowning millennials in the years to come.
The important question is whether millennials will be able to afford to buy the homes they so desperately desire. Despite 2019 seeing slower growth in real estate markets nationwide, making a competitive offer to buy a home is still out of reach for many younger buyers.
The Pew Research Center defines millennials as the population born between 1981 and 1996 (ages 23 to 38 in 2019). When the global financial crisis hit in 2007, younger millennials were in middle school, high school and college, and the older half were young professionals just beginning to build their careers. The difficult economic conditions in which millennials came of age have had lasting effects on their long-term earning potential and their overall economic outlook.
Millennials had a front row seat to the havoc wreaked by subprime loans, unscrupulous lenders, overextended borrowers and unchecked debt markets. Many parents of millennials struggled financially in the years that followed, and some lost their homes. With firsthand experience of the dangers of debt, it seems that millennials have vowed not to suffer a similar fate.
For example, credit card debt among millennials is significantly lower than that of previous generations. Millennials average $3,403 of credit card debt, baby boomers average $5,603, and gen-Xers average $6,752. Millennials also hold less mortgages and car loans. What millennials do have, though, are student loans—and boy do they ever: millennials hold an average of 182% more student debt than their college graduate counterparts in 1995.
In short, millennials are cautious. But while they remain wary of overextending themselves, that won’t stop them from buying their slice of the American dream. In fact, millennials already make up the largest proportion of the home-buying market.
Spending habits aren’t the only way in which millennials differ from their predecessors. In the same way that dating apps have digitized the world of romance, the internet and real estate apps are poised to revamp the traditional home buying experience.
The days of the Yellow Pages and lookie-loo buyers are fading into obscurity, replaced by a savvy and well-researched consumer base. According to the National Association of Realtors®, at least 81% of millennials who already own a home found their property through a mobile app. Millennial buyers tend to know what they want, and that includes fast and attentive service.
Millennials also want different types of homes than previous generations. They are trending away from 20th century McMansions, instead preferring smaller, more manageable properties. They are seeking features and amenities that suit their lifestyles, from pet-friendly yards to space for organic gardens. Millennials may prefer cozy locations within walking distance of local shops and nightlife, in lieu of a sprawling estate on the edge of town. From the way that millennials meet their agent, to the way they choose their home, technology and the internet age are pressuring the industry to adapt.
At the end of the day, partnering with a veteran agent for expert guidance and tailored service is still key to buyer success. The home buying and selling process is sure to change further as young blood enters the market and new technologies arise. Those real estate agents who do not provide sufficient value to their clients will fall by the wayside. On the other hand, agents who leverage their market insight, their local connections, and their dedicated role as trusted advisers, will find continued success.
Whether you’re a first-time buyer looking to start building equity instead of throwing away rent each month, or if you’re a seasoned homeowner looking to make a move, we have the experience to help you succeed and the track record to back it up.
At the Stavros Group, we always aim to provide value to our clients buying and selling real estate in Newport Beach, Laguna Beach, Corona del Mar and beyond. To get our clients to best terms, the best offers, and the best opportunities. We dedicate our waking hours to help guide you through one of the biggest decisions of your life, because it’s what we love to do. Don’t hesitate to reach out and let us know how we can help!
Interest rates are low, low, low, and that means it’s a great time to be a home buyer! While median home prices haven’t dropped much nationwide, the costs you save with a low rate over the course of your loan more than make up for any monthly market swings. So, if you’re ready to take the plunge, and if you’ve saved for a down payment (more on that below), it’s time to consider your financing options!
These days, the 30-year fixed-rate conventional mortgage remains the predominant form of financing for home purchases around the country. At an average interest rate of just 3.61% in September of this year, standard terms on these loans are currently quite favorable to buyers. However, as consumers grow more sophisticated or seek more help through other alternatives, we are beginning to see a rise in the percentage of purchases financed through non-conventional means.
Per the National Association of Home Builders’ analysis of 2018 Census Bureau data, in 2018 nearly 30% of financing secured by home buyers was non-conventional. FHA loans led the pack at 11%, followed by cash purchases at around 10%. While you may or may not have the stack of dough on hand to make an all-cash offer, loans such as an FHA first-time buyer loan may be perfect for you.
Let’s take a look at the loan type options, conventional and non-conventional, that you can consider for your Newport Beach, Laguna Beach, or other Orange County home purchase:
The big daddy, the standard by which all others are judged. Accounting for over 70% of loans originating in 2018, conventional fixed rate mortgages are far and away the most common form of financing. These loans offer a single interest rate over the course of the loan, from day-one to day-ten thousand, nine hundred and fifty seven (and a half – thanks leap years!). A conventional fixed-rate loan is perfect for buyers who want a predictable payment and who intend to stay in their new home for the long haul. A down payment is required, so be sure to pad your savings account if this loan sounds right for you.
As the name implies, adjustable-rate mortgages do not remain constant like a fixed-rate loan. Typically offered at lower starting rates compared to fixed-rate loans, an ARM offers a better deal for a period of time such as five to ten years, and then the rate “adjusts” to the current market. So, if you’re planning to sell the home two or five or even ten years down the line, this financing option may be a great option for you to save money during that period. Considering the incredibly low rates offered these days, it’s unlikely that your ARM rate will remain as low once the initial fixed period runs out, so make sure that the terms of your ARM coincide well with your long-term plans.
Backed by the Federal Housing Administration, an FHA loan offers the opportunity for qualifying buyers to pay as little as 3.5% down on their home purchase instead of the typical recommended 20% on a conventional loan. While 20% is not required by all conventional financing, conventional guidelines tend to be more stringent, so FHA loans are a perfect option for prospective buyers with decent credit but lower savings to make a purchase. FHA loans are fixed-rate over 15- or 30-year terms, with a maximum loan amount that varies by state and county. Note that buyers of FHA loans must use the home or investment property purchased as their primary residence, and they are required to pay for mortgage insurance over the course of their loan.
Veterans who have served for 90 consecutive days during wartime, 180 days during peacetime, or spent six years in the reserves are eligible for a VA loan with no down payment and no mortgage insurance requirements. These loans, backed by the Department of Veterans Affairs, do have some additional requirements, however: The home must serve as the buyer’s primary residence, and the home must fit within certain standards set by the program. That means no fixer-uppers are allowed!
If the bustle of city living no longer suits you and you’re looking to start a “Green Acres” life of your own, consider a Rural Development loan from the US Department of Agriculture. These loans are backed 100% by the government, meaning you don’t need to pay a down payment, and the program offers discounted mortgage rates for those looking to lay down roots in a rural area. Guidelines include restrictions on buyers’ debt-to-income ratio (not to exceed 41%), and property purchased must be in an eligible rural area as designated by the USDA. Learn more about the various types of USDA loans.
If you’re looking to buy a new home but your money is tied up in your current home’s equity, then a bridge loan is your answer. Like its namesake, a bridge loan spans the gap between the home you currently own and the home you want to purchase. Lenders will combine your current and your new mortgage payments into one, and when you sell your current home you will use those proceeds to pay back the bridge loan. These loans are great for buyers who currently own a home, have good credit and a low debt-to-income ratio.
We hope that this brief overview helps to give you an idea of your options for financing the purchase of your next home. As local real estate experts, we have seen it all, and we know how important it is for you to consider all your options. For a good portion of buyers, a conventional fixed-rate loan makes the most sense. But for many others, these alternatives are worth considering! Let us know if you’re in the market to buy a home, and we’ll be happy to hook you up with a trustworthy lender offering competitive rates. It’s our pleasure to assist in anything real estate related, from the first steps of securing financing to the day you move in and for years to come.
Hear ye, hear ye, guys and ghouls: Spooktober is upon us, and with it come the costumes, the parties, the candy, and of course the haunted houses. Right up there with graveyards, real estate has long been the setting for scary stories of things that go “bump” in the night.
To the true believers, living in a haunted house sounds like a recipe for many sleepless nights. Research from YouGov shows that about 45% of Americans do indeed believe in hauntings and ghosts. Those folks will likely shy away from visiting, much less purchasing, a haunted home.
To the skeptical, real estate with a haunted past might sound like a good way to snag a deal on a property. But, in most cases, a home will sell for roughly the price that it’s worth based solely on its location and material value—haunted or not.
However, there are some examples of homes garnering significantly less buyer interest due to their spooky reputation. For instance, this Victorian mansion in Massachusetts, once a Freemason hall and then a brothel, was listed shockingly cheap at just over $300,000.
Something you may not know: depending on where you live, some states require real estate agents to disclose in a listing whether there was a death in the home, or even whether the house is considered haunted by some. For a fee, you can find out about deaths in a home from services like DiedInHouse.
In California, an agent must disclose whether there has been a death in the home in the past 3 years, including natural deaths. In Hawaii, however, any occurrence that had no material effect on the physical structure of the house does not need to be disclosed.
Other states, like Georgia, don’t require anything to be disclosed up front, but they do require any questions to be answered truthfully. A majority of states do not require deaths or reports of the paranormal to be disclosed, in order to protect sellers from undue stigmatization.
In the spirit of the season, we thought we’d share a few of the spookiest homes in America. How would you like to live in one of these?
The Los Feliz Murder House
Source: Realtor.com
Early in the morning of December 6th, 1959, Dr. Harold Perelson murdered his sleeping wife with a hammer and attempted to do the same to his daughter, Judye. The teen girl managed to escape and rouse her neighbors who called the police. Dr. Perelson proceeded to ingest dozens of pills and died before an ambulance arrived.
Rumor has it that this Spanish-style mansion in the upscale LA neighborhood of Los Feliz was briefly rented out to a family in the early 1960s, after which it remained empty for decades. Christmas decorations were visible inside the home, likely left by those renters as the Perelson family was Jewish. Neighbors reported paranormal activity, and the house became an attraction for thrill-seeking tourists. Decades later in 2016, the home was sold.
The Winchester Mystery House
Source: Pixabay
Once the residence of Sarah Winchester, widow of firearm magnate William Wirt Winchester, this Queen Anne Victorian mansion in San Jose, CA, is well known for its puzzling design and its frequent paranormal sightings.
The home has been featured in media such as Ghost Hunters, and it was the set location for the Winchester film starring Helen Mirren as Sarah Winchester.
The Amityville House
Source: Wikimedia Commons
In 1974, six members of the DeFeo family family were found murdered at this house in Amityville, New York, 30 minutes outside of New York City. Roughly one year later, the Lutz family bought the home at a huge discount. They lasted 28 days in the home before leaving due to sightings of paranormal activity.
The Lutz family’s short time in the home was memorialized in 1977 in a novel by Jason Anson, The Amityville Horror, which has since been made into multiple feature films.
The Whaley House
Source: Wikimedia Commons
This haunted house in San Diego’s Old Town district is said to have been the site of hangings before it was built in 1857. The owner’s daughter, Violet, killed herself at the house in 1885. Stories say that a number of spirits roam the house to this day.
Now a California Historical Landmark and a museum, you can take a tour of the Whaley House for yourself during a trip to Old Town… if you dare!
These are just a few of our nation’s many reportedly haunted homes. As a Halloween attraction, the haunted house industry brings in over $300 million each year. Do you plan on visiting a haunted house with your friends or family this year?
The year is 1984, and despite Orwellian predictions to the contrary, nothing seems to be going poorly at all as you amble down your tree-lined street. A neighbor cheerfully hollers across the road, but with Purple Rain cranking through your Walkman, you can’t quite make out what he said. Nudging the headset off one ear, you hear him repeat, “Howdy neighbor!” Well, howdy, yourself!
You’ve rented here for quite a while. It’s a sleepy little suburb with friendly folks and good schools. For years, you’ve saved diligently with the goal of making an offer on one of the charming homes for sale that you see every day on your walks. Browsing the Yellow Pages and consulting with friends, you finally found a real estate agent who you can trust. Now all that’s left is to get approved for a mortgage! Considering your outstanding credit, the lender is willing to make a deal—thirty years fixed at a low rate of just fourteen percent!
It may seem crazy to young homeowners and aspiring buyers, but throughout the 1980s the national average mortgage interest rate was well into the double digits. Recession and inflation starting in the late 70s prompted drastic measures from the Federal Reserve who cranked up interest rates to even as high as twenty percent. Since then, and especially after the financial crisis of 2008, the average rate has seen a precipitous decline. After years of wavering around four percent, the notion of a thirteen or fourteen percent mortgage is unthinkable to most new and would-be homeowners.
Let’s compare an average 30-year fixed-rate mortgage in August 1984 with August 2019:
In 1984, your mortgage would cost over four times the amount borrowed over the course of the loan. Whether you’re bearish or bullish on the economy as a whole, with a little perspective it’s abundantly clear that home buyers have it very, very good these days. As an extreme example, the stark contrast illuminates how important interest rates are in a home purchase.
Using more recent and normal examples, the current average still beats recent rates including just last year. In August 2018, an average fixed-rate loan of $500,000 would cost you $917,389 over 30 years. One year later in August 2019, you would save nearly $100,000, at $820,386 over 30 years. That’s a huge difference and huge savings after a rate drop of less than one percent (4.55 to 3.62%).
So what does this all mean? First off, it’s clear that buying a home when rates are low is the most effective strategy to ensure that you’re getting a good deal. Both buyers and sellers benefit when rates are low, as buyers can afford to borrow more money for less overall cost. When buyers can afford bigger and better homes, competition is increased across the market, listings garner wider interest, and ultimately sellers receive higher offers and closing prices. All at essentially no extra cost to the buyer, because their money simply went further at a lower interest rate.
This also means that homeowners who purchased recently could be eligible to save big by refinancing an existing mortgage above current rates. According to analytics firm Black Knight, four out of five mortgages originating in 2018 are at least 0.75% higher than today’s rates. Additionally, they found that most mortgages from before 2004 could have rates lowered by about 1.75%, leading to massive savings.
Inevitably, the Federal Reserve will raise interest rates and the market will retract to some degree. Of course, nothing about the economy happens in a vacuum, and there are always countless extenuating factors. So we’ll skip making bold predictions. Instead, we will simply recommend this sage old advice: “Get while the gettin’s good.” Rates are nearly as low as they can be, and real estate is entering its most active time of year. If you’ve been thinking of buying or selling, now is an excellent time to do so! Give us a call to find out how we can help.
You’ve decided to make the move to Orange County and you’ve even started browsing some houses for sale in Newport Beach. If you’re new to the area, the next step in your house hunting journey you may be thinking, “What is the best neighborhood for me?” We’re here to help!
Welcome to the next edition of our Neighborhood Spotlight Series, where we provide a little insight into some of the best neighborhoods Newport Beach, Laguna Beach and Corona del Mar have to offer, so you can feel more comfortable in the purchase of your new home in Orange County.
This month we will be featuring West Newport, a neighborhood in Newport Beach that boasts over two miles of coastline and some of the best beaches in Newport. West Newport is ideally located where the coastline splits into the mainland and Balboa Peninsula, giving it a ‘beach city’ culture. This means West Newport residents enjoy the best of both worlds, with the convenience of quick access to the rest of Newport Beach, as well as the restaurants, shopping, and attractions that the peninsula offers.
We have created an infographic to provide a quick glimpse into some of the housing and residential statistics that a potential homebuyer may be interested in. We hope you find this information helpful!
We happen to have a beautiful property currently on the market, that’s located on the edge of West Newport, but in a prime oceanfront location. This spacious multi-unit property at 2212 W. Oceanfront totals approximately 3,200 square feet and includes a 2-bed double-master unit with 3 baths upstairs, as well as a 3-bed, 2-bath unit downstairs. Both the upper and lower units feature a chic updated interior and stellar ocean views. The prime waterfront location provides convenient access to hip shops, restaurants and bars. Wake up with a stroll along the shore and an espresso at Urban Cup, pop in for lunch at local favorite Dory Deli, or enjoy a night out at newly-opened Fable & Spirit nearby. Whether you choose to rent both units or keep one for yourself, one thing is for certain: your residents will love waking up to the beach right outside their door.
We know that trying to settle on the right Newport Beach neighborhood as you’re looking at homes for sale in Orange County can be tricky, but here at The Stavros Group we’re here to provide a helping hand and make the process of buying the Newport Beach home of your dreams as easy as possible. Please do not hesitate to give us a call!
When you are looking to buy a home in Orange County, the first step in the process should be evaluating your finances to determine just how much house can I afford? If you haven’t always had a clean payment history or have significant debt, you may be asking how to improve your credit score. Because a credit score is extremely important to lenders, this is an area for immediate attention. Credit scores affect lending rates, the amount you are eligible for, and often the payment terms. With a low score, you will be at a disadvantage when looking to secure funds for a new Laguna Beach or Newport Beach home.
While there are many prospects when considering Orange County homes for sale, the reality of the situation is that the cost of living in California is high and the better your credit, the higher budget you will most likely have to work with. When consulting with a real estate agent, like myself, we will try to get you the most for your max allowance in terms of a price point, but you need to be certain that you will be approved for the needed funds. There are few things you can do to improve your overall credit score before looking to buy a home in Orange County.
Your overall score is determined by several areas, but the history of how you pay your bills is the most significant impacting factor. Your bill payment history is equal to about 35% of your total credit score. Making monthly payments for outstanding debt on or before the due date will do a lot to increase your score.
There are several sites that offer free credit score reporting, and by staying on top of the activity, you will know how to address any problems. This can keep your score from developing errors.
If your score has dropped, look at the different areas and find out why. You can sometimes contact your company and ask them to remove reported late payments. You can even open disputes on items that are incorrect.
The second largest area making up your credit score is the debt ratio. This is equal to about 30% of your score and takes several factors into consideration. This will look at the number of open accounts you have and the amounts that have been utilized for each account. The rule of thumb is to keep your credit accounts 30% or below the available limit.
As the saying goes, there are many things that improve with age, and your credit score is one of those things. The longer your accounts remain open and in good standing, the higher your score will go. It is hard to keep something on your history, such as a car or house that has been paid off, but some of your revolving credit accounts can be of help to your financial situation. This category determines approximately 15% of your total score.
Install loans and revolving credit are the two types of accounts reported. By having both loan types on your credit, it displays a sense of familiarity with the lending and payment process. This improves your score and establishes credibility for lenders.
Every time you open a new account or apply for financing, it puts a mark on your credit score. These marks will drive down your score. It is suggested to only make an inquiry once every six months or so.
If you are looking for a quick way for how to improve your credit score, getting a personal, secured loan might be the answer. With a lump-sum loan, you can pay off higher-interest debt accounts and manage payments. This still leaves you with credit history but allows you to remove negatively impacting accounts.
By improving your credit score, you become desirable to lenders. Not only will they provide a favorable loan rate, you will have increased access to higher limits and offers. This extension of funds will go a long way in ensuring you are able to purchase the Orange County home of your dreams. If you’d like to discuss your options in the Orange County real estate market, please feel free to give me a call!
Summer is already starting to draw to a close, but temperatures are just beginning to pick up….as is the market!
We have a unique selection of Newport Beach Luxury homes for sale available at the moment — from a gorgeous luxury farmhouse to an ocean view duplex on Balboa Peninsula to a custom Santa-Barbara influenced home within walking distance to the beach. Whether you’re looking for some additional income or the perfect property for yourself, we strive to offer some of the best possibilities Orange County has to offer. And it has some stunners!
In other news, REAL Trends just released their 2019 America’s Best Real Estate Professionals list, and we are so honored to have been added to this list!
According to Steve Murray, the president of REAL Trends, “Those individual agents and teams who make up the 2019 America’s Best Real Estate Professionals represent less than 1.5 percent of all Realtors® in the country yet account for over 12 percent of the closed transactions and more than 22 percent of all the sales volume closed last year.”
What an amazing statistic to be a part of — our goal is to keep this momentum going and continue to perform our best for the best clients. I once read the following quote and it seems fitting:
“Don’t work for recognition, but rather do work worthy of recognition.”
This is what we strive to accomplish every day we come into work! Numbers are great, but a satisfied client is lasting.
We’ve had a few new spectacular properties come on the market recently that I must share with you!
Looking for an investment opportunity in Newport Beach, or just need a multi-unit property for you and your family? We’ve got a great one for you.
This ocean view dual complex home at 216 21st St. is a great income-producing property. This property comes fully furnished, and you can immediately enjoy rental income from existing short term rental bookings. The upper owner’s unit features 3 bedrooms and 2 baths, a large master, vaulted ceilings and open floor plan. The downstairs unit features 2 bedrooms and 2 bathrooms with a rear private patio. Both units completely remodeled with new cabinets, travertine floors, granite countertops, recessed and cable lighting, tankless water heaters and stainless steel appliances. Exterior and interior freshly painted. Newer windows and doors. Located close to Newport Beach Pier, restaurants, shopping and night-life. All utilities have been separated, making this the ideal income property.
And we can’t get over this gorgeous luxury farmhouse-style home at 2101 Leeward Ln. that was just reduced by $220,000! Completed in 2019, this exceptionally appointed home in Newport Beach’s Dover Shores community showcases on-trend style and state-of-the-art smart-home technology. Curb appeal is off the charts, with Modern Farmhouse architecture complementing a soft-contemporary interior with 6 bedrooms, 4 baths and a bonus room in approximately 4,226 sq.ft.
As always, do not hesitate to reach out with any real estate questions or needs! We hope to hear from you!
Buying or selling your Orange County home can be an extremely exciting time in your life, however, it can also be incredibly confusing and stressful if not equipped with the right tools to navigate this momentous life decision. Dealing with terms like Adjustable Rate Mortgage vs. Fixed-Rate Mortgage, recurring vs. nonrecurring closing costs, and Earnest Money Deposit can be daunting to even the most experienced homebuyer. That’s why it pays to have a good foundation of knowledge going into any real estate transaction. The real estate terminology guide we provided below will get you started, but the best way to ensure you have a thorough understanding of every step of your Laguna Beach, Corona del Mar or Newport Beach home buying or selling process is to have a knowledgable, reputable realtor on your side. Whether a first time home buyer in California or a seasoned pro, with my keen insight into the market and expertise in the community, I can help navigate your Orange County real estate transaction with ease and confidence.
Active: This means that a property is currently on the market and available for sale. It may have received offers, but none has yet been accepted, meaning you are still able to make an offer if you so wish.
Active with contract (AWC): This means that even though there’s an accepted offer on the home, the seller is looking for backup offers in case the primary buyer falls through. While any seller can entertain backup offers as a precautionary measure as long as this is made clear in the contract, this term most often crops up with short sales, since they can often fall through, and it can be helpful if a second buyer is waiting in the wings.
Adjustable-Rate Mortgage (ARM): A mortgage loan with an interest rate that fluctuates in accordance with a designated market indicator over the life of the loan (usually 1-2/year). To avoid constant and drastic fluctuations, ARMs typically limit how often and by how much the interest rate can vary.
Annual Percentage Rate (APR): A yearly interest rate that includes upfront fees and costs paid to acquire the loan, calculated by taking the average compound interest rate over the term of the loan. Mortgage lenders are required to disclose the APR so that borrowers can more accurately compare the actual cost of different loans with different fees.
Appraisal: A determination of the value of the house you plan to buy. A professional appraiser makes an estimate by examining the property, looking at the initial purchase price, and comparing it with recent sales of similar properties. Your bank or other lender will require the appraisal in order to ascertain the worth of the house for lending purposes. The lender may refuse to fund the loan if the appraisal comes in lower than the loan amount. In this case, unfortunately, you must either come up with additional down payment money or a better appraisal.
Asking Price: The initial selling price of a property, determined by the seller.
Assumable Loan: A home mortgage which can be transferred from the previous owner to the new owner, thus allowing the buyer to take over the seller’s mortgage. Most lenders require the borrower to qualify for the mortgage in order to assume the mortgage.
CMA: Comparative market analysis or competitive market analysis. A CMA is a report that shows prices of homes comparable to a subject home and that were recently sold. The sold prices, known as comps, can help homeowners determine how much their home is worth in the current market.
Contingency: A provision in a real estate contract in making an offer is “contingent”, or dependent, on one or more conditions that must be fulfilled before the buyer is willing to proceed with the purchase; such as the prospective buyer making an offer contingent on his or her sale of a present home.
Conventional Mortgage: A type of mortgage not insured by either the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA), and thus usually requiring a 10–20% down payment.
Counteroffer: The rejection of an offer to enter into a contract, where the rejecting party includes a different offer that changes the terms of the original offer in some way. The legal significance of a counteroffer is that it completely voids the original offer.
Down payment: The lump sum in cash that you can afford to pay at the time of purchase. Traditionally, down payments are 20% of the purchase price.
Earnest money deposit (EMD): A partial payment demonstrating “good faith” in a contractual relationship, made at the time of the purchase offer. The remainder of the payment is due on the closing date. The seller keeps the earnest money if the buyer fails to make timely payment in full (or if there is a similar breach of the agreement).
Escrow: The holding of funds or documents by a neutral third party prior to closing your home sale.
Fixed-rate mortgage: A mortgage loan that has an interest rate that remains constant throughout the life of the loan, usually 15 or 30 years. This mortgage’s interest rate will never change, even if the term of the loan is 30 years. This can be good or bad, but it will always be predictable. Interest on fixed-rate mortgages is almost always higher initially than on adjustable-rate mortgages. But you’ll also be protected against rate hikes, a pitfall of adjustable-rate mortgages.
FHA Loan: A program in which the federal government (Federal Housing Administration) insures the lender if you fail to pay and they have to foreclose and wind up losing money. The government doesn’t make the loan, they just offer the guarantee to the banks. Such financing allows for a lower down payment than required by most lenders. Houses must be in decent shape to qualify for FHA Loans. The other kinds of loans are Conventional and VA.
Home inspection: A thorough professional examination, typically at the buyer’s expense, that evaluates the structural and mechanical condition of a property, including plumbing, foundation, roof, electrical, HVAC systems, etc. This highly recommended step is a common contingency clause in real estate sales contracts. If the inspector identifies issues that may be expensive to remedy, these can be revisited with the seller before proceeding with the sale.
Homeowners’ association: An organization made up of neighbors concerned with managing the common areas of a subdivision or condominium complex. These associations collect monthly dues and take on issues such as garden, pool, and fence maintenance, noise abatement, snow removal, parking area upkeep, repairs, and dues. The homeowners’ association is also responsible for enforcing any covenants, conditions, and restrictions (CC&Rs) that apply to the property.
Homeowners Insurance: Insurance that protects the homeowner from “casualty” (losses or damage to the home or personal property) and from “liability” (damages to other people or property). Required by the lender and usually included in the monthly mortgage payment.
House closing: The final transfer of the ownership of a house from the seller to the buyer, which occurs after both have met all the terms of their contract and the deed has been recorded.
Loan Origination Fee: A fee charged by the lender for evaluating, preparing, and submitting a proposed mortgage loan.
Mortgage Insurance Premium (MIP): A charge paid by the borrower (usually as part of the closing costs) to obtain financing, especially when making a down payment of less than 20 percent of the purchase price, for example on an FHA-insured loan.
Multiple listing service: A computer-based service, commonly referred to as MLS, that provides real estate professionals with detailed listings of most homes currently on the market. Membership isn’t open to the public, however much of this information is sold to and can be found by the public on many real estate listing websites.
Nonrecurring closing costs: Those costs of closing a home purchase that need to be paid only once — such as the appraisal fee, title insurance, and transfer taxes. (Compare with recurring closing costs, defined below.)
Pending Sale: This is the escrow period, where the seller has an accepted offer and an executed contract, all the contingencies have been met, and the buyer and seller are working towards a closing.
PITI: Abbreviation for the major expenses that make up a mortgage payment: principal (the amount borrowed), interest, (property) taxes, and (homeowners’) insurance.
Point: Prepaid interest on a loan, equal to one percent of the principal amount being borrowed. The lender may charge the borrower several “points” in order to provide the loan. The advantage of paying points up front is that a lower interest rate can be secured for the lifetime of the loan. This may be a good deal if a buyer plans to stay in the home for many years, as the long-term interest savings outweigh the initial cost in points.
Pre-approval (loan): A lender’s written guarantee to grant a loan up to a specified amount (subject to receiving full documentation). Pre-approval for a loan can strengthen a buyer’s negotiating position with a seller.
Pre-qualification: Less official than a mortgage pre-approval, banks offer free pre-qualifications to estimate the amount a buyer may be able to borrow. It is often used early in a buyer’s search to help determine a reasonable price range.
Principal: The outstanding balance on a loan. Also refers to the portion of a loan payment that pays down your debt.
PMI/Private Mortgage Insurance: If your down payment is less than 20%, you’ll have to buy Private Mortgage Insurance which protects the bank if you fail to make your payments, they have to foreclose, and they lose money.
Property Taxes: Taxes, based on the assessed value of the home, paid by the homeowner for community services such as schools, public works, and other costs of local government. Paid as a part of the monthly mortgage payment.
Recurring closing costs: Those costs of closing a home purchase that represent the first of a series of payments that will recur over time — such as homeowners’ insurance and property taxes.
Title Insurance: This type of insurance is acquired to protect against any unknown liens or debts that may be placed against the property. Before issuing title insurance, public records are searched to ensure that the current owner has legal rights to the title as well as the legal ability to sell the home and that no liens are held against the property.
Under contract (UC): The seller has an agreed-upon contract with the potential buyer (which is typically contingent on additional factors like financing and inspection results).
VA Loan: A loan guaranteed by the Department of Veterans Affairs against loss to the lender, and made through a private lender. Similar to FHA Loans, the federal government insures the lender if you fail to pay and they have to foreclose and end up losing money. The government doesn’t make the loan, they just offer the guarantee to the banks.
