Head of Affordable Housing in Santa Monica Leaving with Dire Predictions from Les and Elaine

condosThe head of Santa Monica’s largest affordable-housing organization is leaving after five years for a similar post in Hollywood.

The good news for her is it will lessen the weekday commute from Pasadena for Sarah Letts, executive director of the Community Corporation of Santa Monica.

The bad news is the bleak picture of affordable housing in Santa Monica, and elsewhere locally, that seems almost impossible to solve.

“it is incredibly acute,” she said of the housing crisis in Los Angeles County. And now it is hitting not just low-income people but also, increasingly, the middle class.

“It’s every day working people,” Letts said of those feeling the pain today of the lack of affordable and even modestly priced housing, particularly in popular but extremely expensive Santa Monica. “It’s a state (of crisis) that is staggering.”

Letts is moving on to the Hollywood Community Housing Corporation but will work part-time until June so the nonprofit’s Board of Directors can find a replacement.

She lives in Pasadena, and has said she wants to spend more time with her elderly parents, who also live there. Her career has largely revolved around affordable housing.

Letts has much experience with nonprofits like the Community Corporation of Santa Monica, which restores or newly constructs and oversees affordable housing here, relying heavily on federal, state and local money. It has about 90 projects in Santa Monica.

The nonprofit provides housing for nearly 4,000 people, officials say. But it doesn’t come close to filling the need.

Letts said she hated to exit Santa Monica on a pessimistic note, but the statistics make it hard to do otherwise.

She noted that the cost and availability of housing for low-to-moderate income people tends to be worse in California than most other states. But the picture is even darker in Los Angeles County, where median rents soared more than 20 percent between 2000 and 2012 while median income dropped 8 percent, according a recent study by the California Housing Partnership Corporation.

Santa Monica’s median income is $75,000.

In Santa Monica, only about 17,000 of the city’s approximately 52,000 residential units – most of them rentals – remain affordable to those who earn low to moderate incomes. Major changes at the state level for local rent-control laws are tied to the loss of about 500 such units each year in Santa Monica.

As of 2014, less than a third of Santa Monica’s housing could be afforded by low and middle-income earners, half the amount available to them in 1998, statistics show.

Voters in Santa Monica ushered in rent control in April of 1979, again due mainly to rapidly rising rents. But the City has suffered major blows, including two that date back decades but are still being felt, officials said.

First, the Ellis Act of 1985 gave rent-controlled landlords in California the right to go out of the rental business by converting properties into condominiums. Evictions due to the law soared by 75 percent between 2013 and 2014 alone, according to a recent report by the Anti-Eviction Mapping Project, based in San Francisco.

More units were lost after 1994, following the passage of the state’s Costa Hawkins Rental Housing Act. It allowed landlords to raise rents to market rates when most units were vacated.

And in 2011 and 2012, the state abolished local redevelopment agencies. Santa Monica, like many of California’s local governments used those funds to help provide affordable housing.

The City has been scrambling for replacement funding since loosing that money.

Letts spoke highly of the Santa Monica’s leadership, though, and its goal to address the housing crunch.

“In general, in Santa Monica you have an impressive amount of political will and understanding of the need,” she said. “Somehow, some way, I think the City is pretty sure to find creative ways of developing low income housing.”

She lauded Community Corp’s focus on creating family housing stock with two and three bedroom apartments. She points to the highly praised construction in 2012 of a 33-unit affordable housing apartment building for families at 2602 Broadway as one the agency’s success stories.

It was a tear down, she said. Now the building is noted for its creative architecture, use of green space and environmentally conscious construction.

“We have increasing difficulties,” she said, “but we are all doing what we can.”

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

Supreme Court OKs California’s use of ‘unclaimed’ cash from Les and Elaine

Supreme Court

California’s system of seizing and spending “unclaimed” cash from banks, mutual funds and defunct businesses has survived a Supreme Court challenge.

The state says it is now holding $8 billion in lost assets. And from this fund, it takes about $450 million a year to add to the state budget.

After considering an appeal for four months, the justices said Monday they would not hear a long-running lawsuit that contends the state does not do enough to notify the rightful owners before seizing their assets.

Under the state’s law, accounts can be seized if a bank or retirement fund has lost track of the owner for three years.

State Controller Betty Yee says her office holds these assets so they can be returned to their rightful owner. Its website —www.claimit.ca.gov — permits people to check to see if any of their assets are being held by the state. Amounts under $5,000 can be quickly reclaimed, she said.

But lawyers who sued called the state’s system a “recipe for abuse” because many people are unaware that their assets or those of a relative are being held by the state.

In a concurrence, Justice Samuel A. Alito Jr. said the justices should decide “in a future case” whether states must do more to contact owners of lost property.

“As advances in technology make it easier and easier to identify and locate property owners, many states appear to be doing less and less to meet their constitutional obligation to provide adequate notice” before seizing the accounts, Alito said in Taylor vs. Yee. “Cash-strapped states undoubtedly have a real interest in taking advantage of truly abandoned property to shore up state budgets. But they also have an obligation to return property when its owner can be located.”  Justice Clarence Thomas said he agreed.

Separately, the court turned down a building-industry challenge to a San Jose ordinance that says at least 15% of new residential units must be reserved for low-income buyers. These units must be sold at a below-market price that cannot exceed 30% of the buyers’ median income.

The California Building Assn. sued, contending the ordinance amounted to an unconstitutional taking of private property. But the California Supreme Court ruled the ordinance can be enforced, and the Supreme Court said Monday it would not hear the builders’ appeal.

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

Eviction system ‘allows itself to be gamed,’ frustrating landlords from Les and Elaine

Eviction system ‘allows itself to be gamed,’ frustrating landlords

Craig Miller is chief executive of a Los Angeles office-leasing firm. He’s also a landlord, with seven houses for rent around the region.

As Miller tells it, the tenants at one of his properties, a house in Calabasas that rents for $5,225 a month, stopped making payments last summer. Miller began eviction proceedings in August.

“Six months later,” he told me, “they’re still in the house.”

There are plenty of unscrupulous landlords out there — greedy, nasty types who try to squeeze more money out of tenants or ignore unsafe conditions. I’m not overlooking what many honest renters are up against.

But property owners and lawyers tell me that the other side of the coin are court-savvy tenants who know how to work the system and often get away with staying rent-free for months in other people’s homes.

There are even services that specialize in buying extra time for renters who know that eviction is inevitable but want to stay put for as long as possible.

An L.A. company called 866-Eviction markets itself online as the “#1 eviction delay service” and says it can deliver for clients “2 to 7 months rent-free.

“It happens a lot,” said Artin Gholian, a Studio City real estate lawyer. “There are a lot of things people can do to slow down the process.”

Some renters, he said, will keep moving from home to home, running the same racket over and over to reside comfortably in the Southland without paying rent.

Miller said that when he rented his Calabasas house to a middle-aged couple last year, they said they were facing some financial pressure. In return for their signing a two-year lease, Miller agreed to lower the rent to $3,500 for the first six months, rising to $4,500 for the next six before reaching the full $5,225.

“They frequently didn’t pay on time,” he said, “but I allowed them to catch up.”

Miller finally set the eviction wheels in motion after the tenants missed multiple payments.

“I don’t want to evict anyone,” he said, “but I have my own mortgage payments to make. I have insurance payments. My son has a brain tumor and I have to care for him.”

Miller is typical of many property owners who aren’t full-time landlords but instead seek extra income through one or more rental homes. They’re small-time players in a market dominated by larger investors who typically deal in apartment buildings.

California has clear rules when it comes to evicting a tenant. According to the state Department of Consumer Affairs the process begins with the property owner filing an unlawful-detainer lawsuit in Superior Court. In most cases, a tenant has just five days to file a written response after being served with a copy of the complaint.

The state says judges often will hear and decide eviction cases within 20 days after a trial has been requested. In reality, lawyers say, it can take a couple of months for a case to be heard.

Then the delaying tactics can begin.

Tenants can file a motion to quash the landlord’s unlawful-detainer lawsuit. This usually involves a claim that the tenant wasn’t given sufficient notice. If approved by the judge, the landlord will have to serve the summons a second time.

Tenants can file a demurrer challenging the reason for the eviction. If accepted by the judge, this can require the landlord to restart the entire process from scratch.

Tenants also can file requests for additional information or raise “special circumstances.”

“Once you get into this mode, months can go by,” said David B. Epstein, a Pasadena real estate lawyer. “For the property owner, you’re just stuck.”

Eviction-delay services such as 866-Eviction specialize in preparing stacks of go-slow court motions for clients. Typically, the client simply has to sign his or her name to the documents.

Julian Moutan, 866-Eviction’s office manager, told me the company “is just helping the little guy.” He said a few months of rent-free housing isn’t much to ask of landlords, “considering how high the rents are in California.”

I asked how much his company gets paid in light of the fact that his clients are stiffing their landlords.

“We handle that on a case-by-case basis,” Moutan said. Then he observed that “this is starting to sound like an interview” and hung up.

Epstein said people using these services usually pay a flat fee upfront that’s significantly less than the rent they’d have to pay their landlord over the course of several months.

The eviction process was designed with the best intentions to protect tenants’ rights, said Laine Wagenseller, a Los Angeles real estate lawyer. People in Miller’s situation have little choice but to keep jumping through each legal hoop that arises, he said.

“There’s no magic wand,” Wagenseller said. “You just have to wade through the process.”

Miller’s lawyer, Lisa Rosenthal, told me the tenants, identified in court documents as David and Paula Caplan, wasted no time in running the usual playbook — a motion to quash, a demurrer, a bankruptcy filing.

Finally, Rosenthal said, a judge ruled in January that the tenants had to go. They challenged the ruling, thus allowing them to remain in the house.

The Caplans didn’t return my call for comment. But Ken Carlson, an Idyllwild lawyer who said he’s advising the couple, told me the pair “aren’t just trying to postpone the inevitable.”

He said the tenants are simply challenging “technical defects” in Miller’s paperwork, such as not including the days and hours that he’d be available to receive payments.

“This is an example of a landlord accusing tenants of using dilatory tactics to cover their own mistakes,” Carlson said.

Miller sees it differently. “They’re gaming the system,” he said. “But it’s a system that allows itself to be gamed.”

The next hearing in the case is scheduled for next week.

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

Evictions Are Down by 18%; New York City Cites Increased Legal Services from Les and Elaine

Elaine2aEvictions in New York City dropped last year to their lowest level in a decade, as the administration of Mayor Bill de Blasio bolstered efforts to prevent more New Yorkers from becoming homeless.

Evictions decreased by 18 percent last year, to 21,988 from 26,857 in 2014, even as the number of cases filed by landlords for nonpayment of rent declined by only 2 percent, court and city marshals figures show.

That was the lowest number of evictions since 2005, when 21,945 heads of household lost their homes, according to Housing Court Answers, a tenant advocacy group that runs the information tables at Housing Court and compiles annual eviction totals.

Evictions dropped in 2014, though only by 6.9 percent. Before then, the number had climbed every year since 2005, reaching a peak in 2013, when 28,849 evictions were carried out.

The city has allocated nearly $46 million for legal services for tenants in the last two years, and the money appears to be having the intended effect, officials said.

“The money the city put in for lawyers is working,” said Justice Fern A. Fisher, who oversees Housing Court as the deputy chief administrative judge for the New York City courts.

Efforts by the Human Resources Administration to accelerate emergency rental assistance to people who are in danger of becoming homeless have also helped, she said, echoing tenant lawyers and landlord groups.

On Monday, Mr. de Blasio, a Democrat, and members of his administration heralded the drop in evictions at a news conference and praised an effort started last year by the Human Resources Administration to support tenants who are facing illegal eviction.

“Some combination of things is working,” Mr. de Blasio said.

The mayor said the freeze of rent-stabilized units last year may have also played a role. But he stressed the new and aggressive efforts by the city to fight illegal evictions and to represent tenants in court.

As part of that effort, city workers have been going door to door since last summer to identify tenants who are not receiving essential services such as heat or hot water; in those cases, the city does repairs and charges the landlord. Other times, they identified tenants who were threatened with illegal eviction and city lawyers have intervened in court cases, at no cost to the tenant.

Most low-income tenants in New York still face their landlords’ lawyers without representation of their own. Elected officials, legal scholars and tenant groups in the city and nationwide have long pushed to establish a right to counsel in civic actions that affect basic needs like housing, but the cost is high. In New York City, it is estimated such an effort would cost more than $100 million.

The $46 million the city has spent on legal services for tenants over the last two years has brought sizable savings in services for homeless people, given that about a third of families that enter shelters were evicted from private housing, studies show.

One legal services agency, Legal Services NYC, has hired about 90 additional “housing case handlers” — most of them lawyers — since 2014, said Edward Josephson, the director of litigation.

He said the lawyers helped negotiate more time for payments of back rent, fought any overcharges and took landlords to court in cases in which problems have been neglected or tenants have been harassed.

“We’ve had two years to ramp up,” Mr. Josephson said of the increased funding his agency received from the city.

Most cases are over nonpayment of rent, and landlords welcome the declining number of evictions as well. Owners go to court for rent money, not looking for evictions, said Mitchell Posilkin, general counsel for the Rent Stabilization Association, a landlord group.

Mr. Posilkin said several other variables may be at play. The number of eviction cases that have been set for a court appearance is also significantly down.

He noted that the court system has also lost employees in recent years to budget cuts, so it can take weeks longer to get warrants for evictions when landlords win a case.

“It’s only a movement in the right direction if it means that owners are receiving the rent they need to operate their buildings,” he said of the drop in evictions.

But Jenny Laurie, executive director of Housing Court Answers, said the drop was encouraging.

“It was: ‘Whoa! There’s a change that’s noteworthy,’” she said. “We’re definitely seeing more lawyers in Housing Court.”

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

Overcoming job stress: Don’t discount the power of positive thinking, superstition from Les and Elaine

micro-livingMoreover, federal, state and local regulations (the qualified residential mortgage is a great example) often create such high degrees of uncertainty that even the experts are uncertain about what’s coming and what real estate professionals must do in order to comply.

Now couple this with the normal day-to-day stresses such as family issues, money woes and traffic, plus the never-ending onslaught of text messages, Facebook notifications and other digital distractions, and it’s no wonder that so many agents are feeling battered about as if they’re the mole in the “Whac-a-Mole” game.

If the “Whac-a-Mole” metaphor describes what’s happening in your life and business, here are three specific steps that you can take to reclaim control.

1. Magical thinking: an effective coping mechanism?

A new study from the Booth School of Business at the University of Chicago has found that activities such as knocking on wood or throwing salt over your shoulder can actually protect you from bad luck.

“The most common rituals for undoing bad luck — knocking on wood, spitting, and throwing salt — all seem to involve movements that exert force away from a person. … Engaging in avoidant action seems to create the sense bad luck is being pushed away.”

Another version of this approach is to wrap yourself in a ball of white light and to see anything negative bouncing off the light. If a client or someone else is giving you a bad time, see that negativity as bouncing away from you without it harming anyone else.

2. Self-fulfilling prophecy

The scientific explanation as to why these approaches work is called “self-fulfilling prophecy.” The research shows that what we expect to happen generally does happen. This also explains why affirmations work so well for so many people.

To illustrate this point, my two favorite travel affirmations are “I’m blessed in my travels” and “I have the best travel karma in the world.” Given that for eight years I commuted almost weekly between Austin and Los Angeles and still continue to travel extensively as a real estate speaker, my travel karma has been truly amazing. In 15 years, I have never missed a speaking gig or class when I was traveling on American Airlines.

I did have two occasions where I didn’t get home on time — one was due to a tornado touching down near a Dallas airport, and the other was due to a mechanical issue that kept my husband and me in Lake Tahoe an extra night. The delay meant that we had a delightful lunch overlooking the lake, lounged on the beach for several hours, and then enjoyed a wonderful steamboat dinner cruise that evening.

To take advantage of self-fulfilling prophecy in your life, get in the habit of noticing what is going right on a consistent basis and comment on it regularly. The law of attraction says the more good things that you acknowledge, the more likely you are to attract even more good things in your life.

3. Little wins to build momentum

Dave Ramsey, a personal finance author and motivational speaker, recently cited some interesting research that supports his theories about how to handle your debts. Rather than tackling the your biggest debt or the debt with the highest interest rate, here’s what he recommends:

“The math seems to lean more toward paying the highest-interest debts first, but what I have learned is that personal finance is 20 percent head knowledge and 80 percent behavior. You need some quick wins in order to stay pumped enough to get out of debt completely. When you start knocking off the easier debts, you will start to see results and you will start to win in debt reduction.

“The principle is to stop everything except minimum payments and focus on one thing at a time. Otherwise, nothing gets accomplished because all your effort is diluted. … List your debts in order with the smallest payoff or balance first. … Paying the little debts off first gives you quick feedback, and you are more likely to stay with the plan.”

The same is true for your real estate business. Your mindset has a tremendous influence on your success. If you’re facing challenges, begin with whatever is important and that you can handle easily. Once you finish that task, go on to the next important task and focus on that. The success you experience will help you to stay on track and maintain momentum.

If you want to reclaim control from your “Whac-a-Mole” environment, apply any of these three approaches. You may be pleasantly surprised at how much better you feel.

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

You’ve Just Fired Someone. Now What? from Les and Elaine

la-fi-mo-higher-rents-20120411-001If you have employees, it is almost inevitable you will have to fire someone someday. What do you do with the rest of the workforce after you have freed up the future of an employee who was not a good fit for your company?

As soon as possible, gather all the employees. Tell them that the employee has been let go. Say the decision was made for the good of the business, the employees who will continue to work there, and the clients whom the business serves.

Do not go into detail about the circumstances that created the need to let the employee go. There is no point in trying to justify it. You are the dude, the boss. It was your decision and leave it at that.

Do ask if anyone has any comments and/or questions. Make sure everyone in attendance says something. Why? By doing so everyone takes a higher level of ownership for working effectively with the remaining employees.

Finally, remind the remaining employees that they continue to be employed because they are part of the solution, not part of the problem, and that you are proud to be working with such a good team.

Then everyone gets back to work.

By having his brief meeting and sharing the information with everyone at once your team has become even stronger. And the burden of “Why is Joe gone?” is off your back.

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

You Have to Earn 172 Percent of the Median Income to Buy a Median House in Los Angeles from Les and Elaine

2522811854_452dbb95a5_z.jpg

Trying to buy a house in Los Angeles probably feels a lot like taking crazy pills. Prices in Northeast LA are shooting up so much that median prices are now above $600,000 in the once reasonably priced area. Echo Park is now a full-on, rich-people enclave where the median is above $800,000. The staggering prices in famously wealthy parts of town are not to be viewed without a handkerchief and your heart medicine in hand. A tiny kernel of good news, though: LA County saw some of the most improvements in affordability in California at the end of 2015, in part because of “flat home prices and lower interest rates.” Unfortunately, the affordability metric is still below 30 percent, according to the California Association of Realtors—meaning fewer than 30 percent of households in the county could afford to buy a median-priced house.

In the last three months of 2015, only 27 percent of all households in LA County could afford to buy a median-priced house there. That’s an improvement from the previous quarter in 2015, when only 24 percent of households could swing purchasing that median-priced house, but it’s also a drop of one percentage point from the last quarter of 2014.

Affordability is calculated using CAR’s Traditional Housing Affordability Index, which considers the monthly payment—including taxes and insurance on a 30-year, fixed-rate loan—and assumes a 20-percent down payment.

Screen Shot 2016-02-16 at 1.03.52 PM.png
Image via California Association of Realtors

While affordability is making small but apparently encouraging gains, the figures themselves are still a little daunting. The median house in LA County was nearly $482,000 in the last quarter of 2015. The monthly payments would run about $2,410, and the minimum income required to qualify to buy the house is $96,420, CAR figures. If that doesn’t sound so bad, consider that the median income in LA County is $55,909, according to US Census figures from 2009 through 2013.

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Image via California Association of Realtors

Things are slightly less depressing for would-be homebuyers in the greater LA metro area. There, about 32 percent of households could afford to buy a median-priced house ($442,830) in the last three months of 2015, and the qualifying income to buy the house would be about $88,600. The overall affordability is up one percentage point from the previous quarter in 2015, but down from 34 percent in the final three months of 2014.

Elaine                                                     

DRE #00598428

Senior Director, Coldwell Banker New Homes Division

With over 200 condominium, townhome and loft projects successfully marketed

310.453.1965 Cell: 310.633.4742  Fax: 310.756.1233

elaine@elaine360.com

“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”

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