Realestate

With the Obama administration and private lenders actively considering mortgage-principal-reduction programs to help financially distressed homeowners, the Internal Revenue Service has issued an advisory to taxpayers who receive -- or seek to receive -- such assistance if it's offered. The IRS gets involved in mortgage principal write-downs because the federal tax code generally treats any forgiveness of debt by a creditor in excess of $600 as ordinary taxable income to the recipient.

Much of the real estate market is still stuck in deep winter, but Highland Park is showing signs of spring. Investors have descended on this and other communities in Northeast Los Angeles, snatching up bargain-priced Craftsman homes located within an easy distance of downtown. It's an echo of the housing boom, only this time speculators are drawn by the crash in prices. Attracted by an abundance of foreclosures and aided by interest rates near record lows, renovators are giving distressed properties a makeover.

If you've been holding back on the new $6,500 federal tax credit for repeat home purchases, you now have all the official IRS guidance you'll need to buy a house, qualify for the credit and pocket the $6,500. That's because the Internal Revenue Service finally published the rules for the repeat purchase credit along with key details for taxpayers that had been missing since President Obama signed the legislation creating the program Nov. 6. The IRS posted its revised Form 5405 on its website ( www.irs.

Next to Alamitos Bay Marina in southeast Long Beach sits the SeaPort Marina Hotel, a collection of pink low-rise strips sprawling across 11 acres of dry grass and concrete. Built in 1963 for $3 million, the hotel on Pacific Coast Highway and 2nd Street was once a jewel on the water's edge. Then known as the Edgewater Inn, it lured Hollywood celebrities and boasted three restaurants, two cocktail lounges, a yacht catering service and privacy. Time has not been kind, however.

The man whose fanciful visions helped bring to life the exteriors of such Los Angeles landmarks as the El Capitan, Mayan and Wiltern theaters was more modest, but no less meticulous, when it came to designing his own home. The Spanish Colonial Revival house that Octavius Weller Morgan built in 1929 on a double lot in the Beverly Grove neighborhood is exemplary of this quintessentially Southern California style and a Los Angeles Historic-Cultural Monument. Morgan's home -- restored by the current owner -- showcases his penchant for classical design, high-end materials and whimsical flourishes.

You might assume it's just another boring-looking piece of the paper blitz you're hit with when you apply for a home loan. But given IRS Form 4506-T's new prominence in the fraud-shocked mortgage market, it's much more than just another document to sign. The form authorizes a loan officer or mortgage investor to get electronic transcripts from the Internal Revenue Service covering multiple years of your federal income tax filings. The IRS has supplied private tax return information to lenders for years, but the data typically were requested only at the close of escrow, and mainly for self-employed applicants or those with unusual income patterns.

As job losses mount and Americans are faced with mortgage payments they can no longer afford, many are asking: Should I stay or should I go? Bailing out on your home loan and opting to rent may make economic sense in some circumstances, particularly if you are saddled with a big mortgage payment on a home that has dropped steeply in value. But there are serious consequences -- financial, legal, emotional and ethical -- attached to the decision. "There is no angle that you can look at that situation and think it is a great idea," said Bruce McClary, a spokesman for ClearPoint Credit Counseling Solutions.

Sales of California homes priced at $1 million or more tumbled for a fourth consecutive year in 2009, according to a report released Thursday. The number of million-dollar-plus homes sold dropped 23.8% to 18,621 in 2009 from 24,436 in 2008, according to San Diego real estate research firm MDA DataQuick. The decline was the result of buyers holding back, a weak mortgage market for big loans and the drop in home prices over the last several years, dragging the value of many houses below the $1-million threshold, DataQuick said.

Much of the real estate market is still stuck in deep winter, but Highland Park is showing signs of spring. Investors have descended on this and other communities in Northeast Los Angeles, snatching up bargain-priced Craftsman homes located within an easy distance of downtown. It's an echo of the housing boom, only this time speculators are drawn by the crash in prices. Attracted by an abundance of foreclosures and aided by interest rates near record lows, renovators are giving distressed properties a makeover.

The federal government's efforts to eliminate settlement cost surprises for home mortgage applicants may have opened the door to a new -- and potentially costly -- set of consumer problems. Starting Jan. 1, mortgage lenders nationwide were required to begin issuing new "good faith estimates" to applicants covering loan fees and settlement charges. Under the regulations issued by the Department of Housing and Urban Development, the estimates that lenders provide upfront must be accurate -- the same or nearly the same as the fees that are later charged at closing.

As a professional event planner, Allegra Allison has done studio openings, elaborate backyard parties and plush dinner soirees. But it took her eight years to pull off her biggest challenge: the preservation of a last-of-its-kind West Hollywood estate nicknamed "Tara" because of its resemblance to the mansion in "Gone With the Wind. " City Council members this week voted to scrap plans to turn the two-story, Colonial-style home and its wooded grounds into a federally funded, 28-unit apartment complex for low-income senior citizens.

The Federal Deposit Insurance Corp. sued former IndyMac Bancorp Inc. Chief Executive Michael Perry, accusing him of causing more than $600 million in losses from risky mortgage loans that couldn't be sold. Perry acted negligently when he allowed IndyMac to generate and purchase $10 billion in loans for sale in the secondary market in 2007 when he knew that that market had become unstable and illiquid, the FDIC said Wednesday in a complaint filed in federal court in Los Angeles. When IndyMac wasn't able to sell the loans, the bank was forced to transfer them to its investment portfolio where they created more than $600 million in losses, according to the complaint.

Maybe the name "Sonny" gives you a clue. It's the nickname Hassan Astani chose from a favored singer, Sonny Bono, a scrappy underdog if ever there was one. Astani's dream downtown condo project, Concerto, has gone dissonant. The bank backing the project failed, the FDIC stepped in and the hedge fund Starwood Capital Group won the bidding on the bank's portfolio, including Astani's nearly finished $260-million project. Starwood now shares ownership with the feds, and Astani wants control of his project back.

Seaside style Location: 2555 Altamar Drive, Laguna Beach 92651 Asking price: $20.5 million Size: 5 bedrooms, 6 1/2 bathrooms, 10,300 square feet Lot size: 11,325 square feet Additional features: Poggenpohl-designed kitchen with dual Sub-Zero refrigerators, Dacor and Gaggenau ovens; Bang & Olufsen sound systems. Three-car garage. Around the neighborhood: In 2009, 286 single-family homes sold in the 92651 ZIP Code, according to MDA DataQuick, at median price of $1,186,000.

With the April 30 deadline looming, home buyers need to get a move on if they hope to qualify for the federal tax credits of $8,000 for first-timers or $6,500 for owners wishing to move up. But even if you don't have a binding contract in place by the end of the month, there's a good chance that plenty of incentives will be available after the federal stimuli expire. In the new-home sector, builders are likely to dangle free options and upgrades, help with closing costs or perhaps even cash in an effort to keep the sales momentum going into the heart of the spring and summer home-buying seasons.

Southern California's long-suffering office market continued to weaken in the first quarter as demand slid and rents fell, a pattern expected to carry on through the months ahead. The trend is dreary for landlords, who have seen their incomes fall for more than a year, but a boost for office renters who are looking for new space or negotiating to renew their existing leases as they expire. "Rents are as low as they have been in a number of years," said Joe Vargas, executive vice president of real estate brokerage Cushman & Wakefield.

If you're in trouble on your mortgage and can't get a loan modification, check out the Obama administration's standardized short-sale plan that's scheduled to roll out in the next several months. The program, outlined Dec. 1 by the Treasury Department, is an attempt to streamline what has traditionally been a contentious, time-consuming process by requiring lenders and others to use nationally uniform documents, timelines and financial incentives. A short sale involves a lender or investor agreeing to collect less than the balance owed on a mortgage debt out of the proceeds of a negotiated sale of the property.

Behind the walls of this gated Bel-Air estate lies a palatial compound fit for royalty. Its lavish entertainment space includes an outdoor pavilion with a kitchen between the tennis courts and swimming pool. The property was bought in 1989 by Abdullah bin Abdul Aziz al Saud, now the king of Saudi Arabia, who tore down the existing structure and built a French mansion with nine bedrooms, nine bathrooms, two half-bathrooms and a two-story guesthouse. A lot on the west side of the compound, large enough to accommodate a third house, completes the 2.38 acres of grounds.

Art and architecture blend seamlessly in this contemporary Laguna Beach home in the private community of Irvine Cove. A heavily detailed three-quarter-inch layer of French limestone encloses the steel-framed structure, creating the illusion that it's one, monolithic column of limestone. On both sides of the main entry, curved glass panels are accented with rivets. A bridge leading from the entrance to the great room crosses over the atrium. Inside the gallery-styled great room, an art wall features a sculptured circular black brick fireplace with stainless steel trim.

Scattered around town are some surprisingly valuable vacant lots disguised by weeds or broken blacktop or the remains of an unwanted building -- and many have quietly come to market, thanks to the real estate collapse. Billions of dollars were lost by developers who bought land to build high-profile projects but weren't able to get their plans off the ground, even after spending lavishly on architectural designs and other measures to get their buildings approved by local officials.