Thursday, May 31st, 2007 at 3:34 AM
Mr. Lucky
Had my hands full the last couple of days trying to get this one closed in Rancho Santa Fe.
You’d think if you were able to put together a $2.9 million deal with a 2-week closing, the participants would go out of their way to help make it happen. Yet it went like most deals do, with the inexperienced and incompetent throwing every conceivable hurdle in the way.
The first lender denied the loan due to a manufactured home being on the property. That’s right, a practically-new 300sf modular on a permanent foundation, purchased for the caretaker and of little value, turned into a deal-killer. This is after the appraisal came in at $3,033,000 with a $60,000 token value placed on the manufactured home. The review appraiser knocked down the appraisal to $2.9 million, and when the underwriter saw the modular, they just flat out denied it like it was toxic waste, instead of cutting the $60,000 value placed on it.
First Guaranty of Texas took one look at how clean the rest of the package was, and said "hurry up and fund it".
But there were other little crazy things too. Like the escrow officer who wanted the buyers to give her a $500 check to give her a "pad", even though the down payment, closing costs, plus an extra $10,000 were already in escrow. It’s no wonder that consumers get so disgusted with buying and selling real estate.
It’s a humbling business too. When my 10-year old heard that I sold a house for that price (an all-time record), she said, "you just got lucky".
Posted on Thursday, May 31st, 2007 at 3:34 AM in Uncategorized | 12 Comments » | 
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Jim,
SMC | May 31st, 2007 at 5:42 amCongratulations on the new record sale!!!! I am sure your experience had a lot more to do with the deal then luck did….
Congratulations, Jim!!! That’s gotta feel good!
CA renter | May 31st, 2007 at 6:29 amhey Jim, Klinge Realty expanding its territory southward permenantly? will RB and Carmel Valley be next?
heard from a poster on piggington that you’ll be featured in a UCSD real estate forum. will that be recorded for our viewing pleasure?
congrats!
OCRenter | May 31st, 2007 at 2:38 pmCongrats!
Did you throw off the averages all by yourself?
dfw_renter | May 31st, 2007 at 3:06 pmCongrats Jim! What a big close!! Glad you are having a good year. Drink some fine wine and celebrate.
norcal ray | May 31st, 2007 at 4:57 pmThanks – and yes there is a panel discussion featuring Rich Toscano, Alan Nevin, Gary London and yours truly on June 19th for the San Diego chapter of FENG, a group of financial professionals.
I am planning on having my cameraperson there for filming – hopefully somebody will have something funny to say.
Jim the Realtor | May 31st, 2007 at 6:04 pmCongrats, Jim.
Can you share with us, if there is any difference in marketing a house of that value? Do you list it on the MLS? Do you run ad in special publications? Do you appeal to buyers and their brokers in a different manner? Are the commission structures different?
Or is it basically handled the same but with more 000 at the end of everything?
Thanks + congrats again.
I-Man | May 31st, 2007 at 6:08 pmJim
Good Job! Isn’t the market going crazy on the "higher" end? Homes in my neck of the woods seem to be selling for the asking price within two weeks of listing. I’ve seen two homes that I toured within the last week receive multiple offers and actually selling for above asking price.
Would you attribute most of the increased velocity of house sales to seasonality?
southswell | May 31st, 2007 at 6:58 pmJim, congratulations on the record sale. Yes, please do keep expanding southward and get your services going here in La Jolla.
jg | May 31st, 2007 at 8:12 pmI-man,
That’s a good question – is it any different marketing high-end homes, or is it just more 000s?
Differences:
The broker network in RSF and La Jolla is well-established with many veteran agents who value their long-time relationships with their fellow brokers. Doesn’t mean a thing if you listing is over-priced, but might make a difference when buyer agents are selecting homes to show. Conversely, in other areas in North County there are so many agents covering so much ground it’s hard to remember everyone.
The broker previews are very well-attended in the Ranch and La Jolla. In La Jolla they meet before the broker open houses to discuss the listings every week – an extremely valuable place to be for buyer agents to pick up tips on the hot buys. Meetings in Carlsbad and Oceanside have never achieved similar prominence – in fact, they are worthless.
Agents spend millions on Dream Homes magazine ads, only to appease the sellers. Every seller’s ego wants to see their home in Dream Homes magazine, but sorry, it’s very unlikely to sell a home. Good way to find a listing agent who has lots of money to burn though.
I think the marketing of homes has changed dramatically, with focus on the internet. The business will probably change too, as a result. I do a video tour (that I have yet to see anyone duplicate) where I’m walking around the house just like a TV show. With that kind of vivid imagery, the buyers can get a realistic experience of what its like being in the house. Will the business change to listing agents only? Or will buyers find a house on the internet and still want their own agent write it up? I’m betting on the former.
But to further answer your question, the commissions are the same. I went to Steve Finley’s new house yesterday in the Ranch that he has for sale for $20,500,000. Commission is 2.5% to buyer’s agent. Incredible house, very contemporary yet very casual – much like his last house next door that he just sold for $8 million. Who has to play baseball when you have that going on? Very impressive to see his six Gold Glove awards displayed prominently – love that.
Jim the Realtor | May 31st, 2007 at 10:29 pmsouthswell,
I agree on the seasonality, and think it has more impact in this market. A few years ago buyers were on red alert around the clock, but these days I think they need to see other sales happening to have the guts to stick their toe in the water. The fourth quarter this year will be very interesting. For me personally I am predicting a profitable 4Q07, because I plan on working with buyers and dig out the desperate sellers – which there should be plenty.
Jim the Realtor | May 31st, 2007 at 10:36 pmjg,
I know my way around La Jolla real good. In 1987 I started my own company on La Jolla Blvd near Windansea Beach. But I wasn’t an old veteran LJ agent, and had to leave La Jolla too much to sell houses. The traffic coming and going from Windansea was bad then, I can’t imagine what it’s like now – any better?
Jim the Realtor | May 31st, 2007 at 11:00 pm