RETURN TO HOMEAre you thinking of living in Hollywood, California?
A conversation with Eric Smilay of Smilay Properties
I live and work in the heart of the action in burgeoning Hollywood. Lying to the East of Beverly Hills and to the West of Downtown is this consistently evolving and ever changing pocket of Los Angeles. Of course the entertainment industry has always been at the center of its growth and appeal since its inception, and what most would think about when the name “Hollywood” is mentioned. Dating back to the early 1900’s, Hollywood was a town of stars as it evolved out of the major studios opening up shop in the new area due to its ideal climate. Hollywood certainly hit its downtimes throughout the end of the 20th century, but now due to an influx of investments with companies investing literally Billions of dollars, Hollywood is on its way back up to the top and is surely poised to become one of the most desirable places to live on the West Coast. The hills have always been highly coveted due to their great city views, stylish architecture, and peaceful surroundings, but currently the city below is rapidly transforming into a dense urban haven for a diverse group of people who want that New York City vibe, but with California sunshine.
The People
Without question many people from all over are still coming to Hollywood to be stars, while others like its proximity to downtown Los Angeles and its views from the hills. It is a diverse place to be sure, which in my eyes is a great thing. It is fascinating to walk world famous Hollywood Boulevard with its “Walk of Fame” and just people watch. One sees everything from street performers (often dressed as movie characters), to local hipsters, to business people trying to make deals, to celebrities, and tourists from around the globe.
Our Town
The immediate Hollywood area has been rapidly revitalizing since the opening of Hollywood & Highland’s shopping complex in 2001. Following up on this momentum, developers have recently converted early 1900 historic buildings, like the former Broadway Building and the former Equitable Building, into designer lofts at the legendary intersection of Hollywood & Vine. Most recently, the brand new $600M W Hotel and Condominiums was just opened on Hollywood Boulevard across the street from the Pantages Theatre. There are also several new apartment buildings currently being built just off of Hollywood Blvd. With this new influx of higher income residents, new designer stores and high end restaurants have continued to pop up to cater to the new potential clientele. This mixed with the areas history, culture, and trendy nightlife scene makes the area increasingly desirable.
Economy & Prices
Certainly, most of the projects were either completed or already in the works before the downturn in the economy. The ones who bought real estate in the area at the top of the market, like most places throughout the country, have unfortunately seen their home values decline. That said, with the continued growth in the area and influx of new cool goods & services, Hollywood will certainly come roaring back, I have no doubt. To that end, there are deals currently available to be had, as many projects have greatly reduced their prices due to the changing market. Timing is everything, and there are presently savvy buyers swooping up great deals either as primary residences or as second homes when they are in the LA area.
The Future
I see more continued growth and more people clamoring to live in the area, as it continues its return to prominence and prestige. Years ago West Hollywood was thought of as sort of dirty, and now is a designer’s haven for high fashion, furniture, and expensive real estate—Hollywood will continue to do the same. The area will continue to become denser with many more live/work and mixed use buildings coming to fruition. This is both good for convenience of its residents, as well as good for the environment with Angelinos relying less on their cars.
Words of Wisdom
For Buyers:
Speak to a mortgage broker early in the process before you begin to look at properties. Get pre-approved and learn the actual costs associated with home ownership to know what you can and can’t afford. If you can afford $500,000, then I don’t want to show you $750,000 properties you can’t afford, as then you will inevitably be disappointed when I show you the less expensive homes in your price range. Secondly, work with an agent you can trust, who will be honest with you, and then listen to their advice. Every buyer wants to negotiate for good reason, but I would encourage you not to pass up a deal trying to get a steal. If it’s the property you like, and want to live at and your agent thinks the value is there, trust that person and finalize the transaction.
For Sellers:
You have to hire an agent that is aggressive in terms of marketing your property. A lot of agents got lazy when times were good and homes sold in a day at over asking price just by putting the property on the MLS, but in a slower market they are no longer used to hustling. Homes are just like any other product in that they needed to be marketed correctly in order to reach every potential buyer in the area. If your agent is not up on technology and social media, I would look elsewhere as the newspaper and placing the listing on MLS just are not enough anymore. Along with the marketing aspect, make sure your home always shows well. Staging is expensive, but a well furnished property can tell a story and make the space look so much better than a vacant one. You will want to show your property with minimalist general décor, so that the widest range of buyers will be interested, as the buyer may not have the same taste as you do. Many buyers’ imaginations are limited, so the property should be presented in its best possible light so the buyers can instantly say to themselves “Hey, I can definitely see myself living here.”
Realtors & Technology
This is an area that I have really gotten interested in and focused my business on over the past year or so. The technology available today really levels the playing field in terms of being able to get your brand out there and compete with multi-million dollar companies. As an example, I love how on Twitter my username and tweets get the exact same amount of space as Bill Gates, Donald Trump, and P Diddy’s do. It levels the playing field for building your business, as I am quite certain I don’t have the advertising budget that they do. Then it just becomes a matter of providing good content that enhances others lives and getting the word out that you provide that content and service. There are a lot of realtors speaking back and forth about properties they like on the social media sites as well, which puts your property (should you be represented by a social media savvy agent) at the forefront of both agents and potential buyers. At the end of the day it is all about getting the word out, which these new mediums (i.e. Twitter, Facebook, YouTube, & LinkedIn) allow one to do to the widest amount of viewers in the most cost effective manner. Blogs are also key in today’s competitive market, to build and deliver informative and cool content on one’s website, as well as drive traffic to it. At the end of the day, this also allows potential clients to see what I have been up to and my point of view, as I would be willing to bet that most of them are on the same sites.
Preparing To Buy
As mentioned earlier, the importance of speaking to a mortgage professional early on in the process to get familiar with the actual costs of owning a home and knowing what you can afford before looking cannot be understated. Beyond that, think to yourself, “Am I going to be in this home for a minimum of 3-5 years?” The days of homes appreciating at ridiculous clips month after month are gone for the foreseeable future. I believe that buying land is still a great investment long term (my Dad used to say they are not building more land), but would caution anyone looking to make a quick buck in a flip unless they have really added value to a property. Now is a great time to buy with record historical low interest rates available, prices down almost everywhere, as well as a sense that although we are not there yet as a country, the economy and real estate is certainly headed in the right direction. There are definitely a plethora of deals available currently, and as a buyer you obviously want to get the best deal possible, but in high quality areas like Hollywood, don’t be surprised if you find yourself in a multiple offer situation (I’ve been in a couple recently with deals going over asking price). On top of that, Hollywood/Hollywood Hills will always be a desirable place to be; conjuring up images of stars and celebrities and glitz and glamour in people’s minds.
Personal Experience
Just about one year ago I assisted buyer clients buy a designer done architectural property that I knew quite well in the Hollywood Hills that had recently been foreclosed on. You see it was purchased by a fairly well known actor as an investment for $1,550,000 just 2 years prior to the foreclosure. The new owner contacted me after he purchased it to lease it out for him, which I successfully did twice; however, during the last lease when the market dropped he decided it was better to let the property go back to the bank, as the lease amount was not covering the mortgage. The interesting thing is that the bank’s agent told me that he never visited the property and listed it as a “fixer.” It was listed for $700,000. I knew things about the home that nobody else could have known since I had been involved with it for sometime; for instance, the rooftop deck, which has amazing jaw dropping views of Hollywood and would double one’s outdoor space, was engineered for recreation but no staircase had been built to get up there. Even though I am not a pressure salesman at all and it was only the first house I showed these clients, I told them very frankly that this is an absolute deal and is going to go very fast so you need to decide quickly. They trusted me and called about 20 minutes after we left the property to make an offer. The bank had a system where you had to submit your offer online, but you could see the other offers, which blew my mind. We simply waited until very late on Sunday night and bid just above the highest offer and we got it at $735,000. Not only do my client’s love living in the house, Zillow (which I am not a huge proponent of, but is quicker than doing a comprehensive analysis for quick checks) has the property estimated at over $1,030,000—almost $300K profit for my clients in one year! That is what this business is all about for me.
I am a young hard working agent, who simply loves to make deals happen. At all points of the market from $300,000 condos to multi-million dollar homes, I just enjoy making the deal on behalf of my clients. Having been in the business for six years now, I have seen both the end of the truly great times and weathered the storm during the truly bad times, and believe that going forward the hard working tech savvy agents who hustle, market, and truly have their client’s best interest at heart always will be the ones who survive and flourish. No matter how many people I may be actively working with, I always make each one feel as if they are my only one. For my client’s, I am always available.
Eric Smilay
Smilay Properties
Direct# 661.600.7463
www.smilayproperties.com
twitter: @esmilay
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This guest post is part of our Realtor Thursday Series. We invite realtors from towns and cities all over the country, big or small, to participate. Our goal is to “travel” to as many towns as we can in every state. Every town is unique and wonderful to our readers. If you would like to showcase your town, your neighbors and your talents as a realtor, please contact us at liz@dalesiegel.com
