MARK SALKIN TEAM REALESTATE

SEPTEMBER 2007

MarkSalkin Team Real Estate/email us a realproperty@marksalkin.com

Mark Salkin, Esquire / Kristen Moss, Transaction Coordinator

Newsletter for September, 2007 Volume I / Issue 5 / update

Contents this issue:

Market Update – The Sky is Not Falling (At least not everywhere)

Tenants In Common (The New Form of Common Ownership)

Help and Feedback

Intro: On top of it being “that time of year”, that is when residential sales are expected to slow, there is this “aura of fear” pervading the market. As usual, fear is the mind killer. Fear can be overcome by knowledge, and knowledge = power. I hope that you find this an empowering issue.

Market Update: While I hesitate to steal information, it’s not stealing if one makes attribution. So let’s thank the Los Angeles Times for today’s latest: they haven’t said anything the industry doesn’t already know, but it’s nice to see the public obtain the same information. THE MARKET IS NOT CRASHING! – At least not everywhere.

Demographics show that in our area, LA’s Westside, prices have actually gone up, our median price is still +5.8% from a year ago. So if you are an area agent, it might behoove you to carry a copy of today’s Times to your next Open House. Let’s take a look at the areas we serve:

This all translates to a mixed market at worst, making home ownership still the best buy. Rates today are down, so don’t be discouraged by what you read. The Time’s headline that read “August Cold To Home Seller” was designed to sell newspapers, not homes. It could just as easily have read “August Median Prices Up For Many Home Sellers”.

TENANTS IN COMMON – THE NEW LOOK OF CO-OWNERSHP: We all already are familiar with the two most common forms of shared ownership: condominiums and cooperatives (co-op). But the old standby of tenants in common is poised to make a huge change in our market. Tenants in Common (TIC) simply means that ownership in a property can be split up amongst others, where each owner has a divided percentage in the whole and obtains a deed. While historically these owners usually were family members so that management was facilitated by a good relationship, today management is moving into the hands of professionals, often governed by an un-recorded management agreement (MA). This MA itself is the subject of some criticism, but even so, it appears that most of the problems in buying and selling these types of units have been resolved. So what does that mean?

It could mean that certain types of property are ready for a run up in value. Although historically limited to high stakes investors in commercial real estate, new avenues are opening up for other property. These properties are units, under four units per parcel. If the parcel is five units and over it becomes subject to rules and regulations from the Department of Real Estate, but if it is under four units, then a TIC can be created without need of government intrusion or consent. Simply put, you can now sell your 4-plex as 4 separate units, without need to have additional parking or any of the traditional requirements of condo ownership. WOW! The potential savings should be enormous.

Still there is one last hurdle: Financing. This bugaboo has been attacked by certain Northern California banks, yet they are still a bit tepid in moving South. But yesterday I was privileged to attend a private seminar given by Donald P. Novack, a principal in Advisors Lending Group. Don is an all around big cheese: into banking, mortgages, design and development (the renascent and highly artful 78 Design Group) and has many years’ experience in our business. Don’s take is that we are within one – two years of resolving the financial issues that have so far stood in the way of this potentially booming TIC market. If so, there may be heady days ahead.

If you want more information about TIC’s, simply send an email to me at realproperty@marksalkin.com. I’m up to the minute on this stuff, just waiting for my next acquisition.

CAN WE GET YOUR HELP AND FEEDBACK?

We’d like to know if you can help us help you by taking a minute to answer and give feedback:

Is our newsletter valuable to you?

Do you read all of it or skim it?

Is it too long, just right? Too simple?

Is it just another piece of too much information that you don’t want?

What can we do to make it more valuable to you?

Thanks, your feedback is invaluable. AS always, your referrals enable us to continue to provide excellent and confidential service. We always honor our fellow brokers and agents.

Mark Salkin, Esq. (310) 301 2316 DIRECT

Kristen Moss

September, 2007

Email us at realproperty@marksalkin.com