Which Side of the Line? One Week Later, We Have Real Answers.

Last week we asked a simple question in Which Side of the Line Is Your Building On?: which side of the new lending line is your building on. We said most owners couldn't answer it yet, and that the only way to know for sure was a real lender review.

One week later, we don't have to guess anymore. We're now fielding calls directly from HOA boards whose owners are being denied refinancing, and from sellers whose buyers couldn't get a purchase loan to close, because their building didn't clear a lender's review. This isn't a forecast. It's happening in our own markets, right now — across Westside Los Angeles, the South Bay, and West Hollywood.

Two developments since last week. One that adds pressure, one that doesn't.

California's FAIR Plan has sought rate increases averaging nearly 36% following the January wildfires, adding one more cost stacking on top of everything HOA boards are already managing. On the other side: the rule capping investor-owned units at 50% of a building has been fully removed. Buildings that were previously locked out of financing purely on that ratio are eligible again. Real relief, and proof that not everything moving right now is moving the same direction.

We're not going to point to specific buildings or neighborhoods where we're seeing the most trouble. That's not something we think is fair to put in writing about anyone's home or anyone's block. What we can say in general terms: older buildings are feeling this more than newer ones, for the reasons you'd expect: reserve studies that haven't been updated, budgets that haven't kept pace. And self-managed buildings are struggling more than professionally managed ones, because there's often no one guiding the board through a process like this one.

We're getting a real influx of calls right now from self-managed HOAs looking for help, and we can help. We're partnering with property management companies, along with our banking partners, to streamline this process for boards across our markets, managed or not.

Reach out and we'll walk you through it. Let's talk.

One more thing worth knowing, especially if a building turns out to be non-warrantable: that doesn't mean it can't be sold. It means the buyer pool is smaller and the numbers are different, but there are still avenues to get a non-warrantable property sold if you need to move. Don't try to navigate that alone. Go through the review first, so you know exactly what you're working with and what your real options are. For a full breakdown of how the new rules work by building size, our complete lending rules guide is here.

We've said plainly what we think this adds up to: this is going to keep putting pressure on condo values across Los Angeles. When enough buildings fall out of compliance, it doesn't just affect those buildings — it pulls the broader marketplace down with it. We're not saying that to alarm anyone. We're saying it because it's true, and we'd rather you hear it straight from us than find out the hard way.

We don't see ourselves as realtors looking for the next sale on this one. Given how much of this we've already seen, we feel obligated to step in and help homeowner associations across Los Angeles get organized and protect their owners' value — whether or not that building ever lists with us. That means helping HOA boards work directly with lenders, banks, and insurance companies, as a complete package built to help preserve values across the market, not just for our own clients. We've been building toward a moment like this for years, and while most agents have no real infrastructure to help a board through it, we do — because we work through problems like this every day, and our partners and team are stepping up because of the volume and experience we bring to the table.

If you're considering selling, we want to set expectations plainly: fixing a building's compliance gaps can take real time. We can only do so much, and we can't promise a fast fix for every building — but we're working to help as many as we can, and we're actively streamlining both sides of this: the process of bringing a building into compliance, and the underwriting and review process with major lenders, so you know which side of the line your building is on and exactly what needs to happen next.

Whichever seat you're in — owner, board member, or property manager — the move is the same as it was last week, except now there's real evidence behind it. If you're considering selling, give us a call. We'll walk you through what this actually looks like, no sugarcoating. We think the market needs someone to be straightforward right now more than it needs to be reassured. We want to be your advocate and your trusted partner, so that when the time comes, you can actually transact.

When everything is known, everything works.

Ready to find out where you stand? Let's talk.