MONEY Housing Market

Watch: This $40,000 Film Was Made Solely to Sell a House

film director and movie camera on cherry picker
Phil Hunt—Getty Images

Realtor video has bigger budget than some hit indie films.

Have you seen “9133 Oriole Way” yet? It’s a new independent film that was made in L.A. While only 4 minutes and 39 seconds long, it was put together with an impressive budget of more than $40,000, which surpasses how much it cost to make legendary full-length feature films like “Paranormal Activity” and “The Blair Witch Project.”

What really makes “9133 Oriole Way” stand out, however, is the reason it was created—not to entertain the masses, but to sell a home.

The address of the home in question is, of course 9133 Oriole Way, in West Hollywood, and the “lifestyle film” showing off the property was paid for by Williams & Williams, the real estate agency that specializes in “the most high-end properties from the Hollywood Hills to Malibu,” and works with “the cities [sic] biggest A-level actors, athletes, entertainment professionals and Fortune 100 executives.” (Apparently, they don’t work with a copy editor.)

“Regular marketing doesn’t work anymore. We’re appealing to a more sophisticated and savvy group of buyers,” Rayni Williams, of William & Williams, said to the Los Angeles Times, in explanation for why the agency made the film. “We’re taking it to a whole other level.”

According to the LA Times, Williams & Williams spent months finding a director, cast, and crew to make the promotional video. The result is something far beyond a lame slideshow or some kind of video version of the standard still photos showing off a home on a realtor website. While the entire video is set to music (“My House” by Flo Rida) and there is no dialogue, there is something of a plot, in which a handsome hotshot tears out of the home in a Corvette, leaving behind a gorgeous woman who decides to invite over four more gorgeous women to enjoy the property to its fullest. They’re seen lounging by the pool in skimpy bikinis and clinking glasses in the wine cellar in between slow crawling shots showing off the home’s massage room, fitness center, views of downtown, and other selling features.

Why would Williams & Williams fork over $40,000 to show the property off in such extravagant fashion? Well, the agency stands to take in over $1 million if and when it sells the 12,530-square-foot home, which is located in the hills near homes owned by Leonardo DiCaprio and Keanu Reeves and is listed at a cool $33 million. Watch on, and let the realtors know if you’re inspired enough to put in a bid.

MONEY home prices

Real Estate In This NYC Neighborhood Is Worth More Than All of New Hampshire’s

Brownstones on the Upper East Side, New York City.
Patti McConville—Alamy Brownstones on the Upper East Side, New York City

And a bunch of other states' too.

New Yorkers are known for their not-so-subtle indifference to the rest of country. Just think of that famous cartoon, where beyond the Hudson River, a featureless expanse fades into the the Pacific Ocean and a distant sliver marked Japan.

When you view the country through the lens of real estate values, New Yorkers’ view seems crazily close to the mark, at least according to data compiled by Metrocosm, a website run by real estate researcher and New Yorker (of course) Max Galka.

According to Galka’s calculations, New York City’s 305 square miles, which amount to less than one one-thousandth of the nation’s land mass, are valued at about $1.5 trillion, 5% of the $33 trillion value of the entire nation’s real estate.

Looked at another way, only three states beside New York State itself—California, Florida, and Texas— have total real estate values higher than Gotham’s.

The Upper East Side, essentially a handful of tony blocks adjacent to Central Park, is itself worth about $96.5 billion, according to Galka, more than several states including New Hampshire, South Dakota, and Wyoming. The Upper West Side, home of the famous Dakota apartment building (where John Lennon lived and Rosemary’s Baby was set), is worth more than all the real estate in either of the actual Dakotas.

Overall, Manhattan real estate is worth about $733 billion, in line with all the properties in Ohio, Michigan, and Georgia.

MONEY real estate

Home Prices Continue to Rise, But For How Long?

aerial view of subdivision
David Sucsy

Home prices rose 6.3% in May, but higher interest rates loom.

More good news for those of us looking to sell homes.

Home prices climbed 6.3% in May, marking the 39th consecutive month of year-over-year gains, according to a report by CoreLogic. Prices in 10 states, including New York and Texas, plus Washington DC, hit 40-year highs.

But for owners and would-be sellers, the silver cloud has a gray lining. The rate at which prices are rising, which topped 10% in 2013, has begun to slow. Moreover, a key factor driving May’s growth, according to CoreLogic was 30-year mortgage rates, which remained below 4% during throughout the first half of the year. Low mortgage rates tend to push up home prices by making it possible for buyers to borrow more. Conversely, even a small increase in rates can add hundreds of dollars to a monthly mortgage bill.

A potential problem: Last week Freddie Mac reported 30-year mortgage rates had climbed above that threshold to 4.08%. Freddie’s chief economist, Sean Becketti, recently said that much of the recent surge in home prices was the result of buyers trying to act before they climbed even further. That’s likely to happen soon, since the Federal Reserve, which as been holding rates low since the recession has said it plans to begin slowly ratcheting them up as soon as September.

Just how big can the effect be? Real estate analyst HouseCanary recently estimated that if mortgage rates reached 6%, a third of millennials—key first-time home buyers—wouldn’t be able to afford a home at today’s rates.

For the next twelve months, CoreLogic expects a more modest increase in home prices — a gain of 5.1%. But others have sounded less optimistic.

“I’m worried about it,” Glenn Kelman, chief executive of Redfin, a real-estate brokerage recently told the Wall Street Journal. “The rates have been so low for so long that trying to persuade anyone that 4% or 4.5% is still a bargain may not be easy to do.”

 

 

MONEY home prices

The Price of US Presidents’ Homes Today

Some would cost a fortune, others not so much.

White picket fences, grassy green front yards, owning your own slice of the pie — when you think about it, the American Dream is all about real estate. This Independence Day, we’re celebrating the places that some of our most influential presidents, from George Washington to Teddy Roosevelt, once called home.

Today, the National Park Service or presidential historical societies manage most of these homes, but when they were owned by our former commanders in chief, these grand estates played host to swanky parties, intimate family celebrations — and no doubt important conversations.

To find out how much these presidential homes would be worth if they hit the market today, Trulia compared these eight stately residences with like-sized homes currently on the market.

Massive amounts of historical significance? Priceless.

Trulia

More From Trulia:

MONEY real estate

The Surprising Way to Snag a House in a Bidding War

couple taking keys to house
Getty Images

Bidding wars are back. Here's how to win.

Homes are selling faster, and getting more multiple offers and bids above the asking price than just before the financial crises, new research shows. Yet with the typical home still selling for less than it did in 2006, it is difficult to call this a bubble.

Some 28% of homes this year and last year sold within two weeks of being put on the market, up from just 19% pre-recession, according to a survey from Coldwell Banker Real Estate. Meanwhile, 47% of recent home sales saw multiple offers, vs. 42% pre-recession; and 27% got offers above the asking price, vs. 25% preceding the recession.

This data, however, may be somewhat misleading. For starters, the median home nationally sold for $219,400 in April, up 9% from the year earlier and a robust 42% from the market bottom in 2011-2012. But that remains shy of the $230,400 median price reached in July 2006, and after the sharp bounce back price gains now seem to be leveling off, says Budge Huskey, CEO of Coldwell Banker Real Estate.

And most of the heated activity is taking place in desirable neighborhoods, where obstacles to new construction put a premium on existing homes. The bidding wars generally are occurring on move-in-ready homes that are priced to sell. “The vast majority of markets around the country reflect more balanced inventories and rates of appreciation which have decelerated from the pace of the last two years,” Huskey says.

Still, in many ways this is a seller’s market, fueled in part by rising interest rates. Mortgage rates remain low at just above 4% for a 30-year fixed rate. But the trend has been up since January, and many expect rates to continue climbing. That brings in buyers from the sidelines that want to act before the cost of money goes higher.

Even if sellers fail to entice an offer above the asking price, they may take advantage of the conditions and be exceptionally choosey about a buyer. Just 46% of sellers take the first offer they get, down from 59% during the recession, the survey shows. A record 36% of sellers since 2013 say they chose a buyer based on emotion in addition to their ability to pay—up from 19% pre-recession.

Keep that in mind if you are buying. A downsizing baby boomer may not get the price they had counted on before the recession. But they may want to be sure the house where they raised their kids goes to a family they like. “It’s increasingly common for buyers in competitive situations to provide extensive information on why they would prove the perfect owners and neighbors,” Huskey says.

 

MONEY buying a home

More Parents Are Helping Their Millennial Kids Buy Homes

three generations outside home
Chad Springer—Getty Images

17% are helping with everything from down payments to letting their kids move back home to save money.

Many millennials have been hit with hard economic times. The Great Recession, housing crisis, and diminished job options hit many millennials before they could even get established in a career and start to build up the funds necessary to purchase a home.

While the economy is slowly recovering, too many millennials are still unable to afford a home without assistance — and their parents are increasingly stepping up to fill the void. A recent survey by loanDepot shows that 17% of the parents of millennial children (defined here as between ages 18-35) expect to help their children buy a home within the next five years. That’s an increase of over 30% compared to the previous five years, when 13% of parents expected to provide home-buying assistance.

Parental assistance ranges from down payment contributions to allowing children to move back into their homes — and there’s an unusually large increase in those willing to welcome their children back home.

One-third of respondents said they would allow their children to stay home to save money for a home purchase, up from 11% in the previous five-year period. Meanwhile, another 22% of respondents would allow their children to move back home straightaway, compared to 8% in the previous five-year period. In total, over half of the parents expect their millennial children to either live with them indefinitely or until they can save up enough money for a down payment.

The majority of financial help will be from down-payment contributions. Half of respondents plan to help with down payments, with 8% of respondents paying at least 90% of the down payment. That support is down from the previous five-year period, where 65% of respondents covered some down payment costs and 20% covered at least 90% of the costs.

More parents are willing to pay other expenses so their children can save money for a home (30% as opposed to 25% over the past five years), with 18% focusing on excessive student loan debt burdens (compared to 11% in the past). Around 20% of parents are willing to help with closing costs, and the same percentage of respondents is willing to co-sign a mortgage loan with their children. That is about the same percentage of willing co-signers as in the past.

Where do parents get the money? The overwhelming source is from savings accounts. A little over two-thirds expect to draw from their savings to help their children, slightly down from 72% over the last five years. Meanwhile, twice as many parents as in the past five years expect to use funds from refinancing their own home (up to 8% from 4%), acquiring an unsecured personal loan (up to 8% from 3%), or borrowing from their 401(k) program (up to 4% from 2%).

Millennial children are looking at this help as a responsibility to be repaid. While 68% of the parents consider future assistance as a gift, only 29% of millennials agree. (Of course, if the support is down payment, it has to be acknowledged as a gift in order to qualify for a loan.)

If you are one of these parents helping your millennial children, we applaud your efforts — but please make sure you don’t harm your retirement account or other retirement assets in the process. You don’t have as much time to recover from a large financial setback and your children may not be in a position to help you at the right time. Help as you can, but not more than you should.

 

MONEY home prices

This Is America’s Biggest, Priciest New Home

Construction continues at a home being built by Nile Niami, a film producer and speculative residential developer, in this aerial photograph taken in Bel Air, California, U.S., on Monday, May 18, 2015. Niami, who hopes to sell the house for a record $500 million, is pouring concrete in L.A.s Bel Air neighborhood for a compound with a 74,000-square-foot (6,900-square-meter) main residence and three smaller homes, according to city records.
David Paul Morris—Bloomberg via Getty Images Construction continues at a home being built by Nile Niami, a film producer and speculative residential developer, in this aerial photograph taken in Bel Air, California.

An insane mansion is rising in Bel Air.

When the Los Angeles Business Journal reported last summer that work had gotten under way on a megamansion construction project in Bel Air, Calif., the property was expected to measure around 85,000 square feet, including a 70,000-square-foot main house. The New York Times wrote about the NIMBY issues being raised by property last December, when the expected listing price was estimated at $150 million.

These numbers are enormous, astronomical, absurd—hard for the average person to fathom, let alone afford. Yet apparently, these figures were on the low side.

The latest on the property, as reported by Bloomberg News, has it that the compound will exceed 100,000 square footage of living space, including a 74,000-square-foot main residence and three smaller houses on the four-acre property. If this turns out to be true, the Bel Air property would trump the notorious 90,000-square-foot estate in Orlando featured in the documentary The Queen of Versailles for the title of America’s largest recently built home. (The White House, by the way, is a mere 55,000 square feet.)

What’s more, the developer, film producer and speculative real estate investor Nile Niami, says that $150 million is chump change. He plans on putting the property on the market for the more fitting sum of $500 million. Bear in mind that the most expensive price ever paid for a home was $221 million for a London penthouse in 2011, and that no home in the U.S. is currently listed for more than $200 million.

In any event, what does one get in a Bel Air megamansion that measures potentially 100,000 square feet and costs potentially $500 million? Here are some of the key figures:

• 30-car garage
• 5,000-square-foot master bedroom
• 4 swimming pools, including a 180-foot infinity pool
• 1 “jellyfish room” with glass fish tanks on three sides
• 45-seat IMAX-style home theater
• 360-degree views of the Pacific Ocean, Beverly Hills, downtown L.A.
• 74,000-square-foot main mansion
• 100,000+ total square feet on property’s four homes
• 8,500-square-foot private nightclub inside the mansion
• 40,000 cubic yards of earth to be removed for construction
• $500 million expected listing price

MONEY home prices

10 States With the Least Affordable Homes

Diamond Head, Oahu, Hawaii
Carl Shaneff—agefotostock Diamond Head, Oahu, Hawaii

A new study shows where in the U.S. home prices are the most out of whack with income.

In most parts of the country, a family with a median household income should—ideally—be able to afford a median-priced home in that area. In fact, an analysis of county-level data from RealtyTrac showed that a monthly payment on a median-priced home was more affordable than fair-market rent on a three-bedroom unit in 76% of counties studied, making buying a home the more economical choice for many Americans.

Of course, there’s a lot more at play when determining if you can afford a house than looking at your paycheck and the rental market—buying a house often requires a home loan, which can be tougher to come by if you don’t have good credit. At the same time, a good credit score will only get you so far in the home-buying process, because if housing in your area is exceptionally expensive, even a median household income may not get you much house. (This calculator can show you how much house you can afford.)

To determine the states where housing is least affordable, the Corporation for Enterprise Development divided the state’s median housing value by the median family income in that state, according to 2013 Census data. A breakdown of all 50 states and the District of Columbia is available through its Assets & Opportunity Scorecard tool. Here are the states with the least affordable homes.

10. (tie) Rhode Island

2013 median housing value: $232,300
2013 median household income: $55,902
Ratio of median housing value to median income: 4.2

10. (tie) Vermont

2013 median housing value: $218,300
2013 median household income: $52,578
Ratio of housing value to income: 4.2

8. Washington

2013 median housing value: $250,800
2013 median household income: $58,405
Ratio of housing value to income: 4.3

7. New Jersey

2013 median housing value: $307,700
2013 median household income: $70,165
Ratio of housing value to income: 4.4

6. Oregon

2013 median housing value: $229,700
2013 median household income: $50,251
Ratio of housing value to income: 4.6

5. New York

2013 median housing value: $277,600
2013 median household income: $57,369
Ratio of housing value to income: 4.8

4. Massachusetts

2013 median housing value: $327,200
2013 median household income: $66,768
Ratio of housing value to income: 4.9

3. California

2013 median housing value: $373,100
2013 median household income: $60,190
Ratio of housing value to income: 6.2

2. District of Columbia

2013 median housing value: $470,500
2013 median household income: $67,572
Ratio of housing value to income: 7

1. Hawaii

2013 median housing value: $500,000
2013 median household income: $68,020
Ratio of housing value to income: 7.4

Those are some eye-popping figures, especially if you’re from the other end of the spectrum, like Iowa or Michigan, where the median home price is just 2.4 times the median income in those states. Places like Hawaii, D.C. and California are significant outliers, though.

Nationwide, the median-priced home ($173,900) is 3.3 times the median household income ($52,250), but homeownership remains out of reach for many Americans. Homeownership rates are at their lowest level in more than two decades, partially due to tight credit in the mortgage market. To have the best chance at getting a home loan, borrowers need to focus on improving their credit standing (you can track your credit scores for free on Credit.com) and paying down debt, so they can prove their ability to repay a home loan.

More from Credit.com

This article originally appeared on Credit.com.

MONEY home prices

15 Insanely Expensive Homes on the Market This Spring

It's finally beginning to feel like spring, and that marks the start of home shopping season. We've teamed up with real estate website Zillow for a peek into the most expensive listings in 15 U.S. cities.

Your browser is out of date. Please update your browser at http://update.microsoft.com