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Michael Thomson's Blog

By Michael Thomson | Agent in Los Angeles, CA
  • Laurel Canyonites Say Mansion Building Messing With Bobcats

    Posted Under: Home Buying in West Hollywood, Home Selling in West Hollywood, In My Neighborhood in West Hollywood  |  August 13, 2012 12:16 PM  |  429 views  |  No comments
    When wealthy homeowners cry "think of the bobcats!" (or "think of the gobies!" or whatever), there's sometimes something else afoot ("think of the property values/exclusivity/peace and quiet!"), but either way someone's finally paying attention to the bobcats, as in Laurel Canyon today: the LA Times reports that the homeowners group Concerned Residents of Stanley Hills Drive have "filed a lawsuit against the city of Los Angeles for failing to enforce development restrictions on a multi-home project in a Laurel Canyon wildlife corridor." When permits were first issued for the three 4,000 square foot houses back in 2009, the project was supposed to include a 20 foot wide conservation easement dedicated to the Santa Monica Mountains Conservancy (basically a place for wildlife to move through), but "The group claims it later learned that the city allowed the developer to proceed with construction ... with a smaller conservation easement." The group is led by actor Tom Hulce (Mozart in Amadeus), who says "retaining walls and fences put up around the construction site 10 months ago are blocking migration patterns of deer, bobcat and coyotes that have existed for centuries." 

    Michael Thomson is a full time Realtor with the Keller Williams Sunset Strip Office.  He has lived in Los Angeles for over 20 years and specializes in West Hollywood, Beverly Hills, Hancock Park, Hollywood Hills and Beverly Center-Miracle Mile.  Feel free to call for questions at 310-927-8422 or visit the website at CityHomesLA .
  • Stage Could Be Set for a Rental Market Bubble

    Yet another sign of the shifting landscape of the housing market over the past few years, an additional 1.5 million households moved into rental housing over the year ending March 2012, according to a new report.

    That's a 4 percent increase in a single year, said the June 2012 Economic Outlook published by government mortgage giant Freddie Mac, and the highest year-over-year percentage increase in recent history, according to Christina Aragon, director of strategy and branding at Rent.com.

    "A 4 percent increase in households moving into rental housing is significant," Aragon wrote in an E-mail, noting that the previous few years have seen jumps in the renter population, but not quite as dramatic.

    While the increase might be significant, Aragon isn't all that surprised, especially given that the number of U.S. households grew by nearly 1 percent last year, the steepest increase since 2007. Meanwhile, the homeownership rate—currently around 65 percent—has sunk to its lowest level in 15 years.

    [See a slideshow of the most competitive rental markets.]

    The substantial increase in renter households partly stems from the lingering effects of the housing and foreclosure crises, which converted many former homeowners into renters. The continued tightness of mortgage credit and higher down payment requirements have also played a role in keeping more Americans renting, experts say.

    "The homeownership rate isn't going to turn around any time soon," says Jed Kolko, chief economist at real estate website Trulia. "There are still so many barriers. Most renters are still two or more years away from homeownership."

    Mirroring that trend, vacancy rates have plummeted to their lowest level since early 2002, causing some rental markets to tighten and rents to rise. According to a recent survey by Trulia, rents were 6 percent higher in May than they were a year ago. Some metro areas have seen even steeper surges—renters in San Francisco have had to stomach rent increases of around 14 percent, while those in Miami, Oakland, and Denver saw increases of more than 10 percent.

    "Further increases in rental demand are likely in the coming year as newly formed households postpone homeownership until the economy strengthens and they have accumulated sufficient savings," the Freddie Mac report said. "Overall apartment market trends may show further vacancy declines and rent gains, with property values improving as well."

    [Read: Here's Why the Rich Are Still Renting.]

    That trend troubles some experts who fear a bubble in the rental market could be forming. Rental income for investors is growing at an incredible speed, which has attracted even more interested parties looking to capitalize on the shifting dynamics of the housing market. That's spurred a great deal of new construction, with builders scrambling to satisfy the still growing demand for rental properties.

    "Any time you have a bubble that bursts, investors will seek another bubble," says Anthony Sanders, professor of finance at the George Mason University School of Management. "They seek whatever is the hottest thing in town, which by definition then becomes a bubble."

    The government has also had a hand in setting the stage for a potential bubble in the rental market, according to Sanders. Government-backed mortgage giants Fannie Mae and Freddie Mac are among the largest lenders in apartment building, Sanders says, and with interest rates so "insanely low" the combination of those elements has helped stoke the fires heating up the rental market.

    "The same folks that contributed to the housing bubble, that same mindset that gave us the housing bubble is now giving us a rental bubble," he adds. "All we want to do is cool rents down a bit, but the government doesn't know when to take its foot off the pedal."

    [Read: Echo Boomers to Shape Housing Market for Next 2 Decades.]

    That being said, the government's efforts to convert the foreclosures on its books to rental properties could be one thing that helps keep the lid on a rental bubble, Sanders concedes. Increasing the supply of rental properties would hypothetically ease the upward pressure on rents and help cool down the rental market. "But they can't match it up perfectly," he says. "They can't wrap up apartments fast enough, whether it's through REO-to-rent or just construction to fit that demand. That's why rents are going up."

    But once credit standards ease and more consumers can get mortgages on more favorable terms, Sanders says there could be an outflow from renting and a potential rush back into housing.

    "We might end up building a lot of product now for what they perceive as current demand or demand for the next couple of years, but if something goes the other way and we relax lending standards, we could have a lot of vacancies again," Sanders says.

    Michael Thomson is a full time Realtor with the Keller Williams Sunset Strip Office.  He has lived in Los Angeles for over 20 years and specializes in the Hollywood Hills, Beverly Hills, West Hollywood, Hancock Park and Beverly Center-Miracle Mile areas.  Feel free to call for questions at 310-927-8422 or visit the website at CityHomesLA .
  • Beverly Hills Bids to Halt Subway Tunnel at School

    Posted Under: Traffic & Public Transportation in West Hollywood, Market Conditions in West Hollywood, In My Neighborhood in West Hollywood  |  November 12, 2011 3:52 PM  |  478 views  |  No comments
    It's as hard to travel under the ground in Southern California as it is on top of it.

    Here in the city the car built, the latest attempt to bore a subway line beneath some of the most congested roads in America is recalling civic brawls of a generation ago, when fear over where tunnels could be constructed safely left the region with a subway system so stunted it gets as much ridicule as ridership.

    This time, transit planners hoping to run a 9-mile subterranean line into the city's densely packed Westside have hit resistance within a cluster of stately, red-roofed buildings surrounded by manicured hedges and lush, rolling lawn — Beverly Hills High School. Tentative plans call for drilling a tunnel 70 feet beneath the campus, where Angelina Jolie and Nicholas Cage once roamed the hallways.

    Local officials say ambitious plans for new classrooms and parking would be threatened, and they worry the French Normandy-style buildings could be damaged by construction or train vibration. They want the line to run on an alternate route a few blocks north, along busy Santa Monica Boulevard, though regional transit consultants say that would take the train into the path of unstable earthquake faults.

    The consultants are confident tunneling would not endanger the 2,200-student school, but some envision the worst: a tunnel collapse directly below campus, with students inside the buildings.

    "It's terrible, I dislike it intensely," Theresa Pinassi said with a grimace, as she waited outside the school for her 16-year-old grandson. "It would be dangerous to have it under the school — God forbid, if we had an earthquake."

    It's all deja vu to Mark Fabiani, who served as deputy mayor and chief of staff to former Mayor Tom Bradley, who in his era envisioned a subway that would link downtown Los Angeles with the Pacific coast, a line befitting one of the world's great metropolitan areas.
    It never happened.

    A local congressman pushed through a tunneling ban in 1986 because of fears that construction could cause an explosion of naturally occurring methane gas, a move some viewed as a thinly disguised maneuver to safeguard tony Westside neighborhoods from outsiders. The city ended up with a subway that's invisible to many of its 4 million residents — it's about 20 miles overall in a city covering 468 square miles, petering out just west of downtown's skyscrapers.

    To Fabiani, Bradley's dream would have helped avert Los Angeles' traffic nightmare.
    "When you have no culture of mass transit in your area, it's harder to visualize what the benefits might be down the road," he said.

    The Los Angeles County Metropolitan Transportation Authority, chaired by Mayor Antonio Villaraigosa, isn't expected to endorse a route until early next year, and it's not clear how much of the $5.4 billion line will be built, or when. The most optimistic schedule calls for construction to begin next year, with trains rolling in 2022.

    Local voters boosted sales taxes to bankroll transit projects, but money is scarce in gridlocked Washington. The ban on using federal funds for tunneling was lifted in 2007, but current plans stop well short of reaching the beaches in Santa Monica. Meanwhile, Beverly Hills has enlisted its own consultants for a fight that might end in the courtroom.

    Michael Thomson is a full time Realtor with the Keller Williams Sunset Strip Office.  He has lived in Los Angeles for over 20 years and specializes in the Hollywood Hills, Beverly Hills, West Hollywood, Hancock Park and Beverly Center-Miracle Mile areas.  Feel free to call for questions at 310-927-8422 or visit the website at CityHomesLA .
  • Almost-Done WeHo Library Brings Killer Views, Dramatic Staircase

    Posted Under: In My Neighborhood in West Hollywood  |  June 20, 2011 5:18 PM  |  213 views  |  No comments
    The city of West Hollywood was nice enough to invite us on a hard hat tour of its under-construction library, part of its 25th Anniversary Capital Project. The new 32,000 square foot library opens this fall and includes a coffee bar, children's theater, cable TV facilities, and additional meeting space for the city council and other groups. The $64 million project also adds two and a half acres of green space to West Hollywood Park--a garage affixed to the new library will add hundreds of parking spots, tennis courts will go on top of the garage, and there will be new underground parking, so current surface lots can be replaced by grass and trees. Why build a library in the age of iPhones and laptops? Project architect Steve Johnson of Johnson Favaro says the library "demonstrates that we value reading and education, and it serves as an opportunity for the community to be together under one roof." The interior is quite gorgeous--the third floor has killer views of the Pacific Design Center and the Hills (lots of filming will take place here) and the steps will surely be an iconic meeting and hangout spot. Also, artists Shepard Fairey and David Wiseman have been tapped to create art pieces for the library. Our one qualm? The auto entrance on San Vicente--it not only breaks up the pedestrian flow--many people walk up/down San Vicente--but there's not even a traffic light for cars, so pedestrians will have to dodge vehicles flying in and out. If they can get that worked out, they'll have a nice facility on their hands. Phase II of the project (no timetable yet) would level out the hilly park and clear out the old library. 

    Michael Thomson is a full time Realtor with the Keller Williams Sunset Strip Office.  He has lived in Los Angeles for 20 years and specializes in the Hollywood Hills, Beverly Hills, West Hollywood, Hancock Park and Beverly Center-Miracle Mile areas.  Feel free to call for questions at 310-927-8422 or visit the website at CityHomesLA .
 
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