New jobs, recovering housing market restoring California economy

By Kevin Smith, San Gabriel Valley Tribune |Daily Breeze

California is on track to reclaim its status as the Golden State, according to a report released today.

The Los Angeles County Economic Development Corp.’s 2014-2015 Economic Forecast & Industry Outlook notes that California’s unemployment rate is falling, more people are finding jobs, the housing market is improving and budget surpluses are finally in sight.

The state has regained 70 percent of the more than 1.3 million jobs it lost as a result of the Great Recession, the report says, although the recovery continues to be “very slow.”

“Regionally, the recovery is advancing in nearly every part of the state,” the report says. “Now, after nearly five years of recovery, California is on a more solid footing.”

The report notes, however, that the state is currently grappling with one of its worst droughts on record. Southern California will likely receive little water from Northern California this year and increased conservation and recycling will help the region keep pace with growth and reduce reliance on imported water.

Orange and San Diego counties led the Southland’s growth last year with year-over-year job gains of 2.1 percent and 1.8 percent respectively. Los Angeles and Ventura counties were close behind with employment growth of 1.7 percent. But the Inland Empire was still struggling with growth of just 1.2 percent, the report said.

“The Inland Empire has a lot of strength in construction, but that sector was very hard hit in the Great Recession,” said Robert Kleinhenz, the LAEDC’s chief economist, who helped research and prepare the report. “We’re still looking at several years before we recover all of the jobs that were lost in the recession.”

Los Angeles County — boasting the largest county economy in the nation — saw its population surpass the 10 million mark last year and the region is expected to see nonfarm job growth of 1.6 percent this year with another gain of 1.2 percent in 2015.

The county’s unemployment rate is expected to average 8.7 percent this year and 7.8 percent in 2015.

The most current reading from the state Employment Development Department put L.A. County’s jobless rate at 9.2 percent in December.

The county’s biggest job gains in 2014 are expected to come in health services with 12,800 new jobs. That will be followed by employment gains in leisure and hospitality (8,900), professional, scientific and technical services (8,800), administration and support (7,700) and construction (5,800) and manufacturing (4,700 jobs), the report said.

David Aley, an admissions clerk at the West Hills Health & Rehab Center in Canoga Park, said his facility hired more employees in 2013, bringing the total workforce to around 140.

“In health care you’re always hiring and firing … but mostly hiring,” Aley said with a laugh. “People change jobs, moving from one place to another. But we’re always busy.”

Further inland, the report shows that the combined San Bernardino and Riverside counties area has regained more than 40,000 of the 147,000 jobs it lost during the recession, adding more than 14,000 new jobs in 2013 alone.

The Inland Empire’s most recent unemployment rate of 9.2 percent is expected to average 9 percent this year and drop to 8.2 percent in 2015.

“A lot of hope has been placed on the transportation and logistics part of the economy, not just to generate jobs going forward but to also create a sizable number of well-paying jobs,” Kleinhenz said. “Transportation, warehousing and utilities will grow by at least 2 percent this year in the Inland Empire. The job counts have already exceeded the pre-recession peak.”

The Inland Empire’s biggest employment gains this year are expected to come in retail trade (3,200 jobs), leisure and hospitality (3,200 jobs), health services (2,800 jobs) and government (2,500 jobs).

L.A. County and the Inland Empire are both poised for significant growth in residential housing, the study said.

L.A. County saw 15,700 housing unit permits issued last year and that number is expected to rise 34.4 percent to 21,100 permits this year, with another 28 percent gain in 2015. That would bring the total number of permits issued next year to 27,000.

The Inland Empire is primed for even more dramatic gains. The LAEDC said 8,900 housing unit permits were issued last year. That number will rise 53.9 percent this year to 13,700 permits and 45.3 percent next year to 19,900.

Karl Woehrstein, a broker with the Century 21 Amber office in Torrance, said his area is saddled with an all-time low in inventory. The combination of that and multiple bids have driven home prices back up to 2006 levels, he said.

“Usually our multiple listing service would have 3,000 to 4,000 units for sale,” Woehrstein said. “But now we’re down to about 900 to 950.”

The LAEDC report also notes that the Los Angeles and Long Beach ports play a significant role in Southern California’s economy.

The value of two-way trade in the region is expected to rise 4.5 percent this year to $433.3 billion and 6.9 percent in 2015 to $463.2 billion.


The Hottest Home Design Trends for Spring

The Hottest Home Design Trends for Spring | by Courtney Soinski

Now that we’re coming out of Winter and into Spring, get ready to celebrate warmer weather through hot new home designs with bright colors, beautiful bouquets, and a light, spacious style.  If you want to give your home a new look this Spring, here are some of the most buzzed-about home design trends to incorporate into your next home project.

Embrace Spring Colors!                                      Spring1

A hot trend this Spring is the use of color in a light and airy design.  You can keep the room light and airy by combining blue and yellow along with some white.  Also, using spring-inspired hues like turquoise and red can also liven up a room in the most colorful way.  These bright accents will give your room all the energy it was missing in Winter.



spring5  Wood is the New Neutral.

This season’s trend toward wood textures pairs the warmth, richness, and     texture of real wood.  Installing engineered wood ceilings and wainscoting can       bring the unique look of wood into any environment.  Think wood-textured   textiles, tree-printed wallpapers and embossed soaps that have the  appearance of wood.




Bring the Shores to your Front Door.

If you’re inspired by the lifestyle and environment of coastal living, Spring is a great time to bring the beach shores to your front door.  Weathered and white-washed wood ceilings are a subtle yet stunning addition.  They are especially great when coupled with interior accents like decorative shells and drift wood furniture.





The Power of Texture.

Color is a great addition when it comes to spring home design trends, but even more popular in 2014 is the use of texture.  So put down your paintbrush and add interest to your home with high-gloss finishes, metallics, sequins, and mirrors.  Textured tile walls draw visual interest and can have an even greater impact on the senses with contrasting high-gloss lacquer or low-gloss matte accessories.


Manipulated Metals.

The use and versatility of manipulated metals is a great addition to any home.  Ranging from hand-crafted artisan to contemporary high-gloss, these metal designs are very popular this Spring.  The use of copper, pewter and nickel can be styled in many different ways, including hammered metal sink basins, tin-look ceiling times, antiqued copper light fixtures and brushed stainless steel cabinet hardware.

Using these home design trends this season, you can easily make a stunning impact on your home’s style.  Watch out Spring, here we come!


This Month in Real Estate- February

001 002 003 004

Real Estate Update Videos

Real Estate Update- U.S.

Click on the Links to watch*

Real Estate Update- California

Click on the Link to watch*

FBI arrests two men in alleged $110-million Real Estate Ponzi scheme

Posted by  • Categorized as Industry News

Two owners in a Southern California real estate investment firm were recently arrested by FBI agents for allegedly using their firm to run a Ponzi scheme in which victims lost more than $110 million.

John Packard, 63, of Long Beach and Michael Stewart, 66, of Phoenix were indicted in January by a federal grand jury on 11 counts of mail fraud, three counts of bank fraud and two counts of bankruptcy fraud.

They are accused of using new investor money to make payments to early investors, while pulling out millions of dollars for themselves, as their company, Pacific Property Assets, headed to bankruptcy.

The two men created the company in 1999 to invest in apartment complexes in Southern California and Arizona. It operated from offices in Irvine and Long Beach.

As property values soared in the early 2000s, the company refinanced mortgages and used proceeds to pay investors and business expenses. The two owners also used that money to pull out millions of dollars for themselves, prosecutors said.

The indictment also charges that the company provided false financial information to one of its bank lenders, Vineyard Bank, in order to obtain loans and to maintain its line of credit with that bank. The company overstated its income, concealing the fact that it was losing money, prosecutors said.

Stewart and Packard are accused of bankruptcy fraud for allegedly withdrawing $165,000 from one of the company’s accounts and hiding the money from creditors.

The criminal charges carry a maximum sentence of 320 years in federal prison and millions of dollars in fines.

In 2012, the Securities and Exchange Commission sued Packard and Stewart, accusing them of fraud, and attempted to obtain monetary penalties from them. The lawsuit is pending.

Finding ways to help young adults make their first home purchases

Tough new underwriting standards stand in the way of many potential buyers in their 20s and 30s, but growing numbers of friends and relatives are stepping in to help.

By Kenneth R. Harney | Los Angeles Times
WASHINGTON — Parents, grandparents and young adults know the problem only too well: Heavy student-debt loads, persistent employment troubles stemming from the recession, plus newly toughened mortgage underwriting standards are all standing in the way of vast numbers of potential first-time home buyers in their 20s and 30s.

But are there effective techniques that family members, friends, even employers can use to bridge the generational gap by offering a helping hand — without hurting their own finances in the process? You bet.

First, some sobering numbers:

•Citing Census Bureau data on homeownership by age, demographer Chris Porter of John Burns Real Estate Consulting calculates that Americans who were 30 to 34 in 2012 — those born between 1978 and 1982 — had the lowest homeownership rate of any similarly aged group in recent decades, 47.9%. By contrast, Americans born between 1948 and 1957 had a 57.1% ownership rate by the time they hit the 30 to 34 bracket. This is despite record low mortgage rates and bumper crops of bargain-priced foreclosures and short sales.

•Debt-payment-to-income ratios increasingly are mortgage application killers for would-be first-timers. Adoption nationwide last month of a new federal 43% maximum debt-to-income ratio for “qualified mortgages” is particularly poorly timed for young buyers. Because of large student debts, which average $21,402 but sometimes balloon into six figures, they may not be able to meet the 43% standard for years.

Typically they’re already paying out large amounts on credit cards, auto loans or leases and their student debt — about 30% of current monthly income for those ages 21 to 30 as of 2012, according to a new research report from research economist Gay Cororaton of the National Assn. of Realtors. Factoring in the monthly cost of a typical mortgage for an entry-level purchase, the debt-to-income ratio as of 2012 for these individuals exceeded 60%, Cororaton estimates. Even with a 5% increase in income per year, they will not be able to qualify under the 43% debt-to-income test until 2019.

That’s a long time to postpone a purchase. Yet consumer research consistently finds that the overwhelming majority of Americans in their 20s and 30s would like to own a home, once they’re able to put together the financial pieces to make it feasible.

So what are some of the solutions available to help bridge the gap? The most popular is also the oldest: Growing numbers of relatives are stepping in with gift money to help defray the down payment and closing costs — 27% of first-time buyers last year, according to one industry estimate.

Down payment gifts do not address the crucial debt-to-income ratio problem, but for young buyers who can get close to the 43% mark for conventional loans (Fannie Mae and Freddie Mac) or slightly higher at the more flexible FHA or VA, they can be extremely important.

Rules on gifts vary among funding sources, but there are some shared basics: The money cannot be disguised as a gift if it is actually a loan; there needs to be a formal gift letter that spells out the purpose of the gift and the specific transaction for which it is to be used; and the source of the funds and the capacity of the gift giver to provide the money need to be documented. For down-payment help outside the family tree, check out

But an increasingly important and fast-growing resource is turning the gift concept on its head: Rather than simply handing over their cash with no repayment arrangements, family members are becoming mini-lenders themselves.

With a little professional assistance, they are providing either second mortgages or first mortgages that are custom-designed to deal with whatever financial hurdles — including paying off student loans to reduce debt-to-income ratios — their young relatives are confronting. Properly structured, these loans provide annual returns to family members well in excess of money-market funds or bank deposits, and open the door to homeownership for their kin.

The largest player in the field, National Family Mortgage (, has structured and serviced more than $155 million of intra-family transactions in the last two years and is on track, according to founder and Chief Executive Tim Burke, to do $150 million in volume during 2014.

“There is a lot going on” in this field that can help entry-level buyers strapped with student-loan debt, Burke says.

Distributed by Washington Post Writers Group.

Copyright © 2014, Los Angeles Times,0,7652846.story#ixzz2timBpjU1

Manhattan Beach leads rebound of California’s million-dollar housing market

By Gregory J. Wilcox | Daily Breeze

Here are the state’s priciest communities, along with how many $1 million-plus residences sold in 2013.

1. Manhattan Beach, 439

2. Hillsborough, 436

3. La Jolla, 398

4. Newport Beach, 376

5. Laguna Beach, 374

Source: DataQuick

Manhattan Beach led a strong rebound in California’s luxury housing market in 2013, as sales of homes costing $1 million or more soared 45 percent in the Golden State to their highest level in six years, a market tracker said this week.

Last year, wealthy buyers purchased 39,175 homes costing $1 million or more compared to 26,993 in 2012, said La Jolla-based DataQuick. That’s the most since 42,506 in 2007.

A record number of buyers — 10,602 — ponied up cash for their tony digs and, once again, Southern California dominated the luxury market.

Manhattan Beach recorded 439 million-plus sales — the most in the state in 2013 — edging out Hillsborough in Northern California’s San Mateo County by three sales.

Even the dirt in the affluent beach town is expensive (some undeveloped lots sold for $900,000 each last year), and many million-dollar pads don’t even have an ocean view.

One of the nicer neighborhoods is just east of Highland Avenue. It’s family oriented and has sidewalks and big lots, said Adolph Janes of Shorewood Realtors in Manhattan Beach.

“Most lots are 7,500 square feet. Those lots start at $2 million,” he said. “The typical 2,000-square-foot house and below — well, we tear those down, and we build new homes.”

Other Los Angeles-area communities on DataQuick’s compendium of most expensive California cities were Brentwood at sixth, Beverly Hills at seventh and Pacific Palisades at eighth. And seven of the state’s top-10 markets were in Southern California.

The return of big money into expensive real estate reflects an improving economy, stock-market rebound and a 20 percent increase in the state’s median home price.

“There is a lot of wealth out there, and people do need some place to park it. With the increase in California home prices, I think we’ll see more people moving back into residential real estate,” said Kimberly Ritter Martinez, an economist at the Kyser Center for Economic Research in Los Angeles.

Malibu notched the most expensive sale last year — $74.5 million for a 15,355-square-foot, eight-bedroom, 14-bathroom beachfront estate built in 1993, DataQuick said.

The company does not release addresses, but several websites list the estate as 33064 Pacific Coast Highway. It’s on a 4.85-acre lot with a tennis court and infinity pool and sweeping ocean view. estimates the monthly mortgage payment at $289,510. said in a Dec. 6 posting that Howard Marks, founder of Oaktree Capital Management, sold the estate to an anonymous Russian buyer. It was the most expensive sale in the U.S. at the time and a record for Malibu, the site noted.

In some Southern California communities, including Santa Monica, all the sales last year were $1 million or more deals, DataQuick said.

“The luxury home market is unique, always has been,” John Walsh, DataQuick president, said in a statement. “It responds to its own set of economic factors. Things like job growth, mortgage interest rates and migration patterns do not play the same role as IPOs (and) stock-market performance.”

Landmark Torrance apartment building sells for nearly $40 million

By Nick Green | Daily Breeze

Torrance >> A landmark 248-unit apartment building on Anza Avenue that was once the epicenter of the 1960s Southern California “swinging singles” scene that attracted national media attention has sold for $37.8 million.

The Milano Apartments complex, originally built as the South Bay Club, was acquired by M West Holdings, a Sherman Oaks-based company that has significantly expanded its commercial and multifamily residential portfolios in Southern California in recent years. Wells Fargo, which touts itself as the nation’s leading commercial real estate lender, provided a loan for the entire purchase amount, spokesman Darryl Ryan said.

The South Bay Club was built in 1964 during the height of the city’s growth boom, when more than 110,000 people moved to Torrance in a 15-year span ending in 1965, according to a 1960s-era League of Women Voters profile of the city.

Originally restricted to singles only in days before housing discrimination laws, the amenities included three tennis courts with a pro shop and a resident coach, gymnasium, two swimming pools as well as volleyball and basketball courts, according to a post on South Bay Yesterday, the Daily Breeze’s local history blog. Articles about the complex were published in Time and Parade magazines at the time.

The apartment complex was upgraded in 2008 in the wake of its 2007 purchase by San Diego-based Fairfield Residential for $56 million, property records show.

Matthew Ellis, senior vice president with the Acquisition & Capital Markets group at M West Holding, did not return repeated calls seeking comment.

But the company has said its strategy is to acquire multiunit properties in Southern California located in “stable, in-fill markets.”

The company targets “historically underperforming, underappreciated, poorly operated assets,” according to its website.

The Milano Apartments has a mix of studio and one-, two- and three-bedroom units. It is 95 percent occupied.