For the second year in a row, at the last minute we were able to rush a seller-financed sale, and close on the busiest day for recordings.
In this case, we didn’t have a signed purchase contract until 3pm yesterday – yikes! But we were able to compress a full escrow into less than 24 hours.
The buyer’s agent first called me on Tuesday morning, and I did my best phone presentation because you never know when it could be your lucky day.
I’m glad I did!
I first listed this property on 1/1/2013, and we have been on and off the market since. But over the last few months, we’ve been lowering the price and expanding the terms to include seller financing. There was never any trouble finding interested parties; but because of its unique nature, we had to find the right buyer because it’s really a one-bedroom house on 15 acres with a warehouse and horse corral.
This buyer wanted a sweetheart deal, so in exchange he took the property as-is with no inspections (we had 2 inspection reports), and had to close this year.
We had 3-4 escrows fail when buyers decided the property was too much for them. As a result, we were well-prepared with everything we needed to close promptly. Once we had an written agreement, the buyer just had to sign at escrow and wire his down payment. My LA-based seller had to sign the original grant deed (county insists), and it had to be back here by early today. Our escrow and title companies performed admirably as usual, and good communication clinched it.
Happy New Year everyone!
Rule for picking professionals:
Whenever possible, always hire the ones who routinely do more than is reasonably expected of them. It’s a character and temperament issue, and folks either got it, or they don’t. It’s not when things are going great, but when things are not, they deliver the value. If things start going sideways, they’re always a bargain.
JtR is the true professional! Any agent can show a property. Jim is the kind of realtor that has a network of professionals he can rely on to get the deal done. Other agents are rookies compared to him. Jim is the real deal. He perseveres. “Judge by the results”, I say! I only wish he worked in other states. Congrats, Jim!
I’ve called Jim. He answers his phone. He returns call (in a timely manner). He makes calls to other realtors and sellers. He is an effective communicator. He is a true professional.
Awesome story. And really cool property. I love the warehouse. RSF school district too.
The owner-financing here is the deal-maker.
The buyer gets a lower price (and tax basis), but the seller makes it up on the interest payments.
Loan amount = $920,000 x 5% for four years = $184,000 in interest pmts
Loan payoff in December 2021 = $920,000
Initial down payment = $230,000
Seller receives a total of $1,334,000.
The list price was $1,295,000.
For a seller who is willing to take some now and the rest later to make the deal, it’s a win-win. The seller has to be willing to take the property back though, because there’s always the chance that the buyer might not make the payments. My clients recognize the overall value, so they wouldn’t mind getting it back through foreclosure. They just didn’t want to be the person on-site for the next 2-3 years to complete the project (pour another million dollars into it, and make it a spectacular showcase).
Thanks Jakob, Ray, Susie, and daytrip!
BTW, this property was impacted by the county’s 2020 Plan which downzoned this area.
The new zoning here is one house per twenty acres.
In San Elijo Hills (a mile away) they have 6-10 houses PER ACRE!
that downzoing might be a think of the past, when SDC needs more housing down the road, a good long terms buy, a win-win for everybody…great job
Sure I could build my airplane in there but I couldn’t get it out. Deal breaker. 😉
Great job Jim.
4,000sf warehouse on 15 private acres for a reasonable down payment and less than $1.00/sf. Heckuva deal for a cannabis related operation. Just sayin’.
Did the seller take a security interest in the property until all the payments are made?
Did the seller take a security interest in the property until all the payments are made?
Not sure if that’s a trick question, but yes, note and trust deed were executed. We discussed at length the difficulties of foreclosure in modern California, bit as long as you are the first lien-holder, you’re in the driver’s seat.
This is a perfect case study in why you need the Klinges as part of your inner circle. They keep an eye on your long term $$$, and they also get s&$t done like no other. Congrats, Jim, and seller/buyer!
Not a trick question, and thanks for the response. I wasn’t sure how this would be handled when the party providing the financing isn’t a big financial institution.