Most Real Estate professionals will agree that home designs changed drastically from 1985 to 1990. Shake roofs, popcorn ceilings, wood siding, and single-paned aluminum windows gave way to their counterparts: spanish tiled roofs, flat textured ceilings, stucco exteriors, and vinyl double paned windows.
Toward the end of the 1990′s, wet bars were removed, tiled countertops gave way to bull-nosed granite tops, and sharp corners of walls were replaced by rounded corners.
Fast forward to 2014: Home builders and remodelers are taking styling cues from elements that usually went into high-rise condos. Here are a few examples:
If you’re ever short on ideas, look no further than the model homes in your area. The home builders pay top dollar to some of the best interior decorators in the industry. Take plenty of photos.
As expected, home builder Standard Pacific’s marketing efforts drew large crowds to the their grand opening on May 17th. Even temperatures in the 90s didn’t stop homebuyers from taking a peak while eating the complimentary snacks.
My expectations of Avignon were thoughts of simply larger designs of Standard Pacific’s Montserrat community. Those were quickly exceeded when walking to their plan 3, which was first on their model tour.
Designs are more immersive with arched entryways, grand entrances, and ground level master bedrooms available on some floor plans. Even to a Real Estate agent, it’s tough to distinguish standard features beyond the breathtaking decor that seems to have increased over the prior communities. Of course, none of those decorations and landscaping will come with the homes with exception of the very-expensive models which will be sold in the last phase.
Avignon will release their first phase of homes on May 24th. Buyers will be required to sign up on a first-come, first-serve priority list.
Unlike Coral Ridge and Montserrat, unobstructed city lights view lots aren’t available due to the location of the community. It will be interesting how the international buyers (mostly Chinese) respond. Many I’ve spoke to have a “view or nothing” mentality. However, the far-superior designs might give buyers enough to compensate for the lack of a view.
A few years ago, I got excited about Anaheim going through a transformation that would bring shopping and nightlife to neglected areas outside of the Disneyland Resort. There was promise of a downtown area “similar to the Gaslamp District” next to Angel Stadium. However, it seems all of the plans for the infamous “Platinum Triangle” have been put on hold indefinitely until builders and city officials decide what exactly will be built.
Meanwhile, the downtown area near Anaheim Blvd and Broadway is something that has transformed into a thriving promenade with little fanfare. Mid-rise modern apartments have been built next to chic-styled restaurants and Anaheim’s Civic Center.
“The Domain” by Brookfield Residential is the 2nd mid-rise property to be built in the area after Harbor Street Lofts were constructed in 2010.
Unlike the recent “urban flops” that were constructed (i.e. – Stadium Lofts on Katella and Harbor Street Lofts) where drastic price reductions were needed, the Domain seems poised to be a hit as the Real Estate market has improved and the location actually has several establishments worth visiting several times a week such as Farmer’s Market on Center Street, Umami Burger, and Anaheim Brewery. HOA dues are pretty reasonable for a mid-rise at $243 per month.
Brookfield also seems to have learned from the shortcomings of nearby complexes in order to cater to groups beyond just “20 somethings.” Unlike the Stadium Lofts, The Domain features select residences with direct access garages.
Home designs are as small as 1 bedroom, 1 bath with 897 square feet and can be large as 3 bedrooms, 2 baths with 1,644 square feet with an attached 2-car garage.
Here’s more good news: There will be a significant number of “Plan B” residences (2 bedrooms, 2 baths, 1,103 sq ft) classified as “affordable” units where downpayment assistance will be available. The program is also available toward other designs as long as funding remains. There has been $6M set aside for the program.
Similar to nearby Colony Park, buyers with lower household incomes are eligible to use Anaheim’s Housing Program to assist them in obtaining homeownership. The program offers up to $125,000 in downpayment assistance.
Here are some of the requirements of the program:
- Income limits are based on household size. For example, a household of 2 cannot earn more than $83,700 (using the moderate income table).
- Buyers cannot own more than $92,000 in cash assets.
- All persons in household must provide proof of permanent US residency.
- Applicants must complete HUD’s Certified Homebuyer Education Program.
Call me at 714-501-2732 for more information or use the form in the “Contact Edwin” link above.
In a prior blog, I mentioned that Standard Pacific will be opening a new luxury community in the Blackstone Community of Brea called “Avignon”.
For those who have been keeping up with Blackstone’s development, expect homes to be similar in lot size to the Castillian community sold 2 years ago. Living sizes will be slightly larger and exterior facades will be more extravagant.
The Grand Opening will take place on May 17th and starts at 10 AM. Prices will start in the low $1,000,000s and have living spaces up to 5,485 square feet. Most lots will have canyon or hillside views. A few homes will have city lights views and are expected to be priced near $1.8M.
If 2014 follows the same pattern as 2013 (and any year before that), you can expect the following to happen:
- Inventory will continue to gradually rise until the fall season
- The peak of activity (homes selling) will be between April and August.
- Home sales will decline after August
If you’re like most homeowners, you’re excited about your increased equity. Many homeowners who were barely “break even” or upside down with their loan are now wondering if they’ll have enough after selling to apply toward a downpayment. As values continue to rise and the economy improves, look for an increased number of “move-up” homeowners looking to sell their existing home to purchase a larger one.
Here’s the California Association of Realtors (CAR)’s forecast for 2014:
Keep in mind that we are already 1/4th into 2014. As multiple offers fuel rising values, look for an uptick in supply from the move-up sellers who’ll likely sell contingent.
The big difference between 2013 and 2014? Don’t expect prices to go up 28% in California. As the chart above shows, CAR expects a 6% gain.
Before we get into what Mello Roos is, let’s look at some of the amounts published by builders in Blackstone and La Floresta in Brea:
Emerald Heights by Shea Homes: $976.43 for Plan 2 & 3; $1,226.43 for Plan 4
Coral Ridge by Shea Homes: $1,226 for Plan 1 & 2; $1,412.76 for plan 3
Paseo by Standard Pacific Homes: Amount not published. The brochure states “approximately 1.13%.” I estimate the amount to be about $728 when working backwards form the sales prices and likely will be higher or lower depending on floor plan purchased.
Ventanas by Van Daele: Approximately $800 depending on homesite
Avenida by Standard Pacific Homes: $800 per year depending on homesite
What exactly is Mello Roos?
The term itself comes from The Community Facilities Act of in 1982 authored by Senator Henry J. Mello and Assemblyman Mike Roos. The Act created “CFDs”, or Community Facilities Districts which are established by local government agencies to raise community funding.
In other words, it’s a way for a builder to finance the infrastructure needed to create a new development. This is commonly done through selling bonds. The duration of the Mello Roos depends on the life of the bond. In some areas of Placentia near Champions Sports Complex, the bonds were for 15 years.
From the tax bill above, you’ll see the “basic levy rate” of 1%. In California, this is the base tax rate for a property. North Orange County cities are typically about 1.03% to about $1.15% in communities that “don’t have Mello-Roos.” In Real Estate lingo, while it’s not technically correct, having Mello Roos is any amount significantly above that range. In the bill above, you can see that CFD’s are inline with normal bonds.
However, there’s a line item only described as “other services” for an additional $2053.44! This amount is not technically “Mello Roos” per the definition above.
That was intentional. Don’t worry — you don’t have to be an expert on Mello Roos when buying a home. (However, your Real Estate agent and CPA should know the difference.) What’s important is to know is if the total tax exceeds the normal rate in the area. Once it does, sales data shows it will affect the sales price of a home. Since it boils down to monthly payment for most buyers, the effect is similar to HOA dues.
So, next time you want to irritate your friends on the subject or Real Estate and someone asks, “How much is the Mello Roos in that community?” You should answer, “The question you should be asking is: How much are the additional bonds and assessments above the base tax rate?“
As homeowners are becoming pleased with their equity, the possibility of selling their home in order to buy often results in confusion.
How do most make the transition?
Since the buying side of your transition is obviously the tougher feat in today’s seller’s market, it usually would be best to purchase your replacement home first.
If you’re like most, this isn’t possible because the equity in your home is needed for a downpayment. For those who are worried they won’t find a home and be left scrambling after their home is sold, they often sell “contingent.”
This video shares some of the highlights of selling contingent: