Los Angeles remains a very attractive market for those who can afford it. California Association of Realtors reports that housing prices in Los Angeles this year increased by 6.1% and, according to forecasts, will show an increase of 6.5% for the whole of 2015. Meanwhile, in Los Angeles, prices are reportedly up by 5.4% this year. These numbers include single and attached single-family houses and duplexes. The City Real Estate report states that some areas of Los Angeles luxury have already passed the peak of 2007. This situation makes a great market for hard cash lenders, as many investors are returning to purchase, but they are associated with poor credit ratings and credit histories. Stunned borrowers appeal to lenders with solid cash in their area, who transfer funds to them based on their collateral.
Here are the data for real estate in Los Angeles for 2015-2016
The California Association of Realtors is selling sales of 407,500 single-family homes by the end of 2015. This will be an increase of 6.3 percent compared to homes sold in 2014. Forecasts for 2016 will also increase by 6.3 percent to a forecast of 433,000 units a year.
In Los Angeles, some data sources, such as the California Association of Realtors, show that median sales prices for single family homes and villas rose 8.1 percent to $ 950,000 in the third quarter of 2015; a record high for the area of Greater Los Angeles. Regions include Westside, Downtown, and coastal cities such as Malibu, but omit low-cost areas such as South Los Angeles.
One way to understand real estate price cycles is to look at the numbers of building permits. If developers are investing in new properties, as is happening in the general area of Los Angeles, this is a good sign that demand and prices are rising or remaining. Statistics show a growth of 2.4% in construction projects.
Observers are concerned that Los Angeles may be approaching another housing bubble, but William Yu, an economist at the UCLA Anderson School of Business, strongly denied this prediction in a recent Los Angeles forecast by Anderson. Prices shot (he said) on the already expensive LA market only because of excessive demand and limited supply. This is not a housing bubble, but a very expensive and inaccessible situation where those who have money make or want to invest. In fact, the market mainly serves the very rich. Typical reports show that builders and investors are looking for an elite elite market, where the potential profit far exceeds the profit that an investor can realize at the expense of an average home. For this type of high-end residential complex investors are needed who have the right funds. Some people go to banks for loans. Another approach is alternative traditional lending institutions.
What about those who have no money? Or with a bad loan that can not get a loan?
This is where heavy lenders come.
Los angeles tough lenders
The Los Angeles Money Loan Handbook presents 56 hard money lenders, and the listing is growing all the time. Experts in this field know that there are still many people who are listed elsewhere or remain unregistered. These (and other) brokers provide their personal funds to residential and commercial borrowers. Hard money lenders ignore the credit history and FICO estimates of these borrowers, focusing instead on the value of their collateral. If the borrower defaults, the lender sells his property as payment.
Many investors rush to hard money lenders for their quick turnaround (usually less than a week) and for a simple and easy procedure (just a few documents and a handshake). They hate high interest rates (twice as high as those of banks) and low credit ratios to value (sometimes up to 60% -50%). Many borrowers usually get solid cash loans for the near short-term future, and then return with bank loans or cover the balance with alternative financing. Hard cash loans are expensive, so most borrowers try to use them as soon as possible.
Brokerage agencies in Los Angeles are diverse and extensive. You will find lenders involved in all types of transactions and lending to various investors. Lenders also offer different amounts and for a different amount of time. Because lenders work independently — after all, it’s their own funds that we’re talking about — they set their own terms and conditions. If you follow this route, make sure your lender is certified by the LA Real Estate Services and the National Mortgage Licensing System (NMLS). Also review its credentials and borrowing history. And best of all: before signing up, ask a lawyer to review all agreements.
The bottom line is that ...
Rising prices in Los Angeles and hard stocks led to an increase in investors in the elite residential market. Investors have run out of flips, but there is a wider market for high-paying people or for wealthy foreigners. This type of inventory leads to an increase in prices, and it is expected that in the coming years they will remove them even more, since there is a small new construction in the pipeline to meet the demand.
For those in Los Angeles who want to make the most of this luxury market, but they don’t have the means to do so, using a solid cash loan broker may be an acceptable solution. This type of broker ignores credit history and focuses on the asset. Luxury assets seem to have a high potential. If a borrower can show a broker his ability to repay and convince him of the value of his property, the borrower can find an alternative way to land on the Los Angeles luxury market.
The California Association of Realtors predicts that housing prices are likely to “steadily increase” at the end of 2015 in 2016. Many Los Angeles investors are approaching hard cash brokerage companies to finance their immediate needs. How do these decisions sound to you? Realizable?
