Forecasts for a slow 2016 real estate season have been greatly exaggerated.
Late last year, some financial analysts worried that a rise in the base interest rates by the Federal Reserve would trigger a reversal of fortunes in the real estate industry. Rates would rise, loans would be harder to get, houses would begin to languish on the market, and home prices would drop.
However, that turned out to not happen…at all!
Interest rates, while bumping back and forth between a few fractions of a percentage point, are still holding below 4 percent, despite the quarter percent rise in the base rate the Federal Reserve implemented in December. Continue reading
Should I accept, reject, or counter the very first offer on my home?
So you’ve made the decision to sell your home. You have it listed, and your agent provided you with comparables and information that, from a professional approach, will sell your home quickly and at Fair Market Value. After all, you have your eye on a home in Westridge that you REALLY hope you can purchase once your home gets into escrow. Everything is going great. Even better, two days after your home hit the Multiple Listing Service, you receive an offer!
Suddenly, you begin to second-guess yourself and your Realtor. “Wait. That was TOO quick,” you say to yourself. “Maybe we should have listed it for more money.”
This thought process unfortunately leads many sellers into the trap of self-doubt, leading to a listing that ends up sitting way too long on the market because they decided to reject their first offer for fear they did not ask for a high enough selling price. So what should a seller do when confronted with a quick offer? When should they accept, reject, or counter? Let’s take a look at some solutions.
“Know when to hold ’em. Know when to fold ’em…”
The popular song performed by Kenny Rogers referred to the game of Poker, but in the case of real estate, there are some definite signs as to when you should accept, reject, or counter the buyer’s offer.
Beware the “low-ball” offer.
This is an almost always unsuccessful tactic from buyers who have not been properly educated by their agent as to how the home selling process works. In this case, they try to “haggle” by making a ridiculously low offer, typically WAY below asking price. This is a situation where you may consider countering their offer at a price you feel is fair, or you can reject it outright.
When to reject vs. counter.
In any situation, a buyer’s offer that does not come without at least a loan pre-qualification letter is usually a red flag. Not only is he/she offering a price way below Fair Market Value, but you don’t even know if they can afford to purchase the home.
Another red flag is in the form of very little, or no, good faith deposit from the buyer. Again, this may be indicative of how serious they actually are about buying your property.
The “Asking Price” offer.
If an offer comes in very quickly from a buyer for your home at asking price, don’t second-guess yourself! You have reached this price through the diligence and professional opinion of your real estate agent who has used (and shown you) recent comparables, title information, and demographics to come up with a price he/she knows will help you reach your real estate goals. Of course, the above rules still apply. You will want to make sure the buyer can actually afford to purchase the home, and that they are willing to put down enough of a good faith deposit to make you feel comfortable that they won’t back out before escrow closes.
We are your Santa Clarita real estate professionals!
Montemayor & Associates is a team of highly trained, experienced, licensed Realtors who are ready to serve all of your home buying and selling needs. Contact us today for a no obligation consultation.Email Contact Form
As the escrow process begins, the buyer and seller are responsible for certain costs, but is there any flexibility?
It costs money to buy and sell a home. No, we’re not just talking about the cost of the home itself, but also the costs incurred with insuring the transaction is conducted correctly and in accordance with state and federal real estate laws. While buyers and sellers may view these facts with a bit of disdain, it’s important to understand that a real property purchase comes with liabilities unlike any other type of purchase many of us may encounter during our lifetime.
Before you balk even further, think about this: Without the professional escrow and other affiliated services objectively looking out for buyer and seller interests during the home purchase transaction, what would you know about: Continue reading
It’s a great time for both home buyers and sellers in the Santa Clarita Valley.
First of all, with available housing inventory on the lower side of nominal (somewhere in the mid 500’s), most sellers are confident that they can sell their home relatively quickly at market rates, which climbed nearly 15% in 2014.
Mortgage rates have bumped up (very) slightly, but are still well below 4 percent, which is great news for both buyers and sellers? Why is it great news for sellers? Well, for the most part, many sellers turn into buyers once they have their home in escrow, so the “win-win” is in full effect. Homeowners are excited as well, being able to take advantage of lower rates to refinance to a lower monthly mortgage payment, or access equity to make home improvements or other investments. We’re continuing to see mortgage loan applications jump as a result of low interest rates. Continue reading
2015 off to a great start for home buyer in many ways.
It appears that the news continues to be positive for the Santa Clarita real estate market as we already near the middle of the first month of 2015. First up, interest rates have dropped…again, hitting a 20 month low by hovering in the low 3.70 percent range.
We’ll reiterate how incredible this news is for qualified home buyers looking to maximize their purchasing power. Homeowners considering selling their home soon should also take heed, as there is even more good news that will affect buyers in a positive way.
So, we once again have nearly historically low interest rates. In other home buyer news, Fannie Mae and Freddie Mac have made changes to their guidelines for lenders by backing loans with as little as 3% down.
But wait…there’s more!
As you probably know, purchasing a home using a zero down payment loan requires Private Mortgage Insurance (PMI). Typically, the cost of PMI was 1.35% of the value of the loan at or above 80% of the loan-to-value ratio of the property. The Federal Housing Administration (FHA) recently announced that they will cut the cost of PMI from 1.35% to .85%, which will typically save the homeowner with a zero down mortgage up to $900 per year. Continue reading
Housing prices remain steady, although we’re seeing some signs of the end of the “summer rush.”
August showed a steady pace in the Santa Clarita real estate market, with new information released by the Southland Regional Association of Realtors.
While there were no “wild rides” real estate-wise, we did see a market that held its own through what most consider the “dog days of summer.”
Median home prices and sales remained somewhat the same as July, with median sale prices holding at $415,000, which includes both single family residences and condominiums. We saw a slight drop in the number of home listings at 441 for August, compared to 500 in July, but the number of escrows opened and closed barely changed month over month.
Santa Clarita also saw only a slight drop in the median list price in August at $447,000 compared to $459,000. This accounts for typical pricing adjustments as the summer rush comes to an eventual close. Continue reading
How much are you really making by over pricing your home?
We’ve often spoke about the proven strategy that will sell your home for the highest dollar amount. Many sellers are convinced their home is worth more than their neighbor’s, or that the principle of Fair Market Value can be taken merely as a suggestion.
It’s understandable that you want the absolute most for your home, and it’s our goal to help you achieve a sale that will satisfy you and help meet your real estate goals. The latter is something we want to focus on, as most sellers only look at the dollar amount without considering the potential losses they may face when trying to price their home above market.
While money is definitely a motivating factor when selling your home, it’s only ONE of the many goals for homeowners. Whether you’re moving up, moving down, or perhaps “flipping” a house, there’s one factor you MUST consider along with the selling price: TIME!
The Time Principle
Time is critical, in many cases, to the sale of your home. Think about it: If you already purchased another home, or you’re about to begin paying the mortgage on that rehabbed investment property, the longer it takes to sell, the more it will cost you. How much might you spend in extra mortgage payments while waiting for that buyer who you expect to buy your home that’s priced higher than any other comparable properties nearby? Continue reading
Something both buyers and sellers worry about, and how you can make sure it does close on time no matter what side of the transaction you’re on.
Escrow: That thing buyers and sellers endure as a part of the home purchase transaction. Or at least, that’s how many view the escrow process. Rather than consider it an “endurance,” both parties should view escrow as a way of making sure all aspects of the sale are in place prior to title changing hands.
Why does escrow exist anyway? Why can’t the home just “change hands” without all the waiting around?
Would’t it be easy if you can just make your offer, have it accepted by the seller, give him (or her) your money and then you get the keys? So why isn’t a property transaction as easy as an Ebay sale, or buying a car?
Unlike personal property, real property can be a bit more complicated. As a value asset that may have exchanged hands several times (In some parts of the country, homes can be over 100 years old), both buyer and seller have to be made aware of any issues affecting the property’s sale. This may include problems, defects, title issues, or even easement and boundary disputes. As a buyer, wouldn’t you want to know about these issues BEFORE you get the keys? As a seller, wouldn’t you want to make sure that the sale transaction goes smoothly, and that some issue affecting the property won’t come back to haunt you months (Or even years) after you’ve closed the sale?
Escrow insures that all conditions of the sale are met by both buyer and seller as an objective party to the transaction. A professional escrow company understands the rules and laws as laid out by the Bureau of Real Estate, as well as local laws, amendments, and supplemental guidelines involving a real estate transaction. Continue reading
Buyers are looking at your home, but they’re not looking at YOUR home.
For some sellers, it’s very tough to let go of the fact that the home they’ve lived in will soon belong to someone else. It would almost be abnormal were a seller not be emotionally attached, and in some cases, they stress out over what they feel buyers might think when they walk through the door.
In our discussions about home staging, we discuss various ways to make your home appear larger and less personal. Removing personal items such as family photos and mementos can help inspire a buyer’s imagination to dream about what the home would look like when they move in. Also, storing extra pieces of furniture to give your room(s) a larger feel can also help the buyer re-imagine them with their own furnishings.
It’s sometimes tough for sellers to begin to pack away their personal belongings even before escrow has opened, but it goes a long way toward accomplishing your real estate goal of selling your home for the price you want. Continue reading
Modern Marketing Techniques and Basic Common Sense Pricing Are Two Key Ingredients To a Quick Home Sale
We’re seeing a bit of a shift in the real estate market here in the Santa Clarita Valley. Home sales aren’t slowing (Compared to what we deem a “normal” market), but compared to the brisk pace of home sales last year, we are definitely seeing some change.
Remember however that last year we had an extreme shortage of available homes for sale in the Santa Clarita Valley; as little as a month’s supply on hand. Compare that to this year, where we have nearly triple the amount of homes, and you can see why we’re seeing a slightly different market. Even still, the SCV is sitting on just shy of a three month supply, which is just under what we would consider a “balanced” market.
Even still, home sellers are still in anticipation of a slew of buyers and offers bursting at the seams. So what are the key ingredients we use to produce as many buyers at your door as possible?
1. We market your listing on the internet. Continue reading