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Category Archive: ‘Jim’s Take on the Market’

Real Estate Kiss of Death

How do you know when your offer isn’t going to go too far?

When the listing agent tells you, “I sent your offer to my sellers”.

Come on Jim, don’t you expect the sellers to read it?  Yes, I do, but it would be nice if the agent also offered some advice.  I always include my own opinion on why they should take the offer, because I know the other agent probably won’t.

As a result, this is the phone call the following day:

Agent: Did you receive the offer?

Sellers: Yes.

Agent: What did you think?

Sellers: We didn’t like it.

Agent: OK, thanks, have a nice day!

Of course, they didn’t like it because it was less than full price.

After all the showings during the first week on the market, the sellers were telling all their friends and family that they were going to have a bidding war, and sell for over list price.

But nothing materialized, and a few days or weeks later this snot-filled punk has the audacity to offer less than list price?

It reminds me of the Realtor Facts of Life.

It is best to be:

  1. The first-born child
  2. The second spouse
  3. The third realtor

Once sellers hear the same thing three times, they might start believing it.

It is easy to forget or ignore the truth about real estate.  A property’s value is defined by what a ready, willing, and able buyer will pay for it.

Instead, we convince sellers that they determine the sales price.

I might have a solution though – stay tuned!

Posted by on Feb 19, 2017 in Jim's Take on the Market, Listing Agent Practices, Why You Should List With Jim | 4 comments

Warren is Selling

Warren Buffett is selling his Emerald Bay vacation home….with an agent who doesn’t work at Berkshire Hathaway!  H/T Richard.

https://www.wsj.com/articles/warren-buffett-lists-longtime-laguna-beach-home-for-11-million-1487344530

Billionaire investor Warren Buffett is putting his longtime California beach house on the market for $11 million.

If it sells anywhere near its asking price, Mr. Buffett will score a decent return: He bought the Laguna Beach home in 1971 for $150,000. Mr. Buffett said he bought the house because his then-wife liked it, without giving a thought to its potential as an investment.

At the time Laguna Beach “wasn’t fully developed,” he said, but since then the area “just took off.” He added that he’s put a considerable amount of money into renovating the home over the years.

The 86-year-old Berkshire Hathaway chairman, who lives primarily in Omaha, Neb., said he used the property for years as a beach house for his family, spending summers and Christmases there. But since his first wife, Susan, died in 2004, he hasn’t spent much time there, which is why he’s putting the home on the market.

Posted by on Feb 18, 2017 in Interesting Houses, Jim's Take on the Market | 1 comment

Best Seller Tip

What can a home seller do to help make a sale?

Respond to an offer in less than 24 hours.

Here’s what happens if you don’t:

  1. Once a buyer signs a contract, buyer’s remorse starts to set in. If allowed to fester for a day or two, buyers will talk themselves out of buying just because of the anxiety.
  2. There are just enough other new listings coming to market that the buyer’s wandering eye gets distracted easily.
  3. The longer it takes to get an answer, the lower the buyers want to counter.
  4. After about three days of waiting, buyers give up altogether.

On the other hand, when a seller does respond quickly, it gives the buyer the impression that the seller cares, and wants to make a deal.  Buyers respond more favorably to those!

I had buyers make an offer on Monday that was within 4% of the new list price (sellers raised their list price – our offer was $250,000 over their original list) and here we are on Friday with no answer.

In a different case this week, my buyers offered more than twice what the seller paid in 2002, and three days later it wasn’t good enough – the sellers had to have another $10,000.  This is a house that has been on the market for 100 days with no offers.

In both cases, we were sick of waiting around, and even a more favorable response wouldn’t have gone over that well.

Listing agents are notorious for not preparing their sellers on how to respond to offers.  You can predict the chances of a deal coming together purely by how quick the sellers respond.  If they are adequately motivated and the listing agent has their act together, you will get a response within 24 hours.

If not, there probably wasn’t much of a chance of buying it anyway.

Posted by on Feb 17, 2017 in Jim's Take on the Market, Listing Agent Practices, Tips, Advice & Links, Why You Should List With Jim | 2 comments

More on Broker Public Portal

Realtors are mounting an effort to participate in the real estate portal business.  The Broker Public Portal will be the national collection of listings, much like realtor.com was designed to be.

To those who thought Zillow had already won, this was welcome news.

All we have to do is build a consumer-facing website with more bells and whistles than Zillow or Trulia, and advertise it coast to coast!  Yahtzee!

Not so fast.

Here is the link to what the Chairman thinks about the Broker Public Portal after two years of work:

http://geekestateblog.com/brokers-support-broker-portal/

An excerpt:

There has been a lot of discussion about the Broker Public Portal’s ability to compete with the existing national portals. Someday we may get there, but that is not our short-term goal today. Our goal is to join in the development of the best national MLS consumer search experience. Some believe we are competing against local MLS consumer websites. but we think that the BPP offers a national reach that is complementary and unprecedented, and that will help brokers and agents dramatically increase their connections with online consumers.

Great – maybe if we don’t mention them by name, and don’t compete with existing national portals, they will just go away!

Zillow is wagging the dog now, and they will determine our destiny.

Save

Posted by on Feb 16, 2017 in Jim's Take on the Market, Zillow | 0 comments

Zillow Ending Manual Uploads

Zillow sent out this email today regarding the uploading of listings:

We wanted to let you know that Zillow Group will no longer accept manually entered listings from agents and brokers as of May 1, 2017We are taking this step to provide buyers and sellers with the highest-quality listings data possible, and to provide agents and brokers with a simple way to market their listings. Broker and MLS feeds are the best way to achieve this.

Sandicor, our MLS, refuses to upload every listing.  Instead, each brokerage has to sign a separate agreement between them and Sandicor to authorize the Zillow feed.  There are already plenty of agents who don’t know that the Zillow auto-feed was terminated, and now there will be other brokerages who refuse to comply, and/or don’t realize that their listings aren’t on Zillow/Trulia.

Oh well.

There are other questions though:

  1.  What about the Coming Soons?  If only MLS-fed listings are allowed, then that should be the end of the Coming Soon feature.  Or will Zillow allow their Premier Agents to use it?
  2.  Will they still allow for-sale-by-owners to manually feed?
  3.  Zillow gives preference to their high-paying Premier Agents.  Will this eventually lead to more limits on the properties seen on Zillow – perhaps to those listed by Premier Agents only?  Or is Zillow just rattling their sabres?

Zillow has their foot on the neck of the real estate industry, and they can do whatever they want.  Who would stop them?  They are beholden to the high-paying Premier Agents, so expect more favoritism in that direction.

Posted by on Feb 15, 2017 in Jim's Take on the Market, Zillow | 15 comments

Homebuyer Torture

You’ve been thinking about moving for a while, and are sensing that 2017 is going to be your year.  What can you expect from the sales process?

We already know that to buy a house, you need four things:

  1.  Right house
  2.  Right price
  3.  Right seller
  4.  Right listing agent

How hard can it be? Won’t agents be helpful?

We know that most agents don’t sell enough homes – half of them haven’t sold anything in the last year – and that bumbling incompetence is everywhere.  In most cases, they literally don’t know how to get out of their own way.

Here’s what you can expect to happen:

  • Seeing houses won’t be convenient for you, they will be convenient for the sellers and listing agents. Last weekend I had two different agents tell me I couldn’t show their listing because their assistant was out-of-town, and many want a 24-hour notice to show vacant houses.
  • When you hear that a seller is motivated, it means that they are motivated to get their price.  They’re not going to give it away!
  • Have questions about the property or the process?  Rarely can you get a straight answer. Agents think they might give something away, so they specialize in vague responses so no one can pin them down later.
  • If you do make an offer, don’t be surprised if you don’t get a timely response. All offers have an expiration date, but it is regularly ignored because listing agents think you will put up with anything.
  • Expect a counter-offer. It is extremely rare that a seller will accept your offer outright – mostly because the listing agent feels they have to tweak it, just to say they did something.
  • It won’t matter how many hundreds of thousands – or millions – of dollars the seller stand to profit at your offer price, they will want more.  It will get ridiculous too, probably down to a difference of 1% to 2%, and everyone will just expect you to pay it.  Heck, every other buyer has.
  • The dickering won’t be just about price either.  The last time the listing agent had a buyer, they remember getting beat up on every term, so this is their chance for revenge.  I just had a listing agent counter over the home-warranty company on a million-dollar deal.
  • Don’t expect to move in to the house once the sale has closed.  The seller will need time to vacate, and that becomes your problem.  They will expect at least a few free days to gather up their stuff, or they will want to rent back for weeks or months at a below-market rate.  And no security deposit either – it’s not like they are a tenant or anything.
  • Repairs? You expect repairs for the outrageous price you paid? Fat chance the seller will agree to do much, and if they do repairs, they will cut corners.
  • Close on time? The buyer will be expected to close on time, unless the seller doesn’t feel like it. I saw one where the seller – who was an agent – refused to move out of the home because her new one wasn’t finished yet, and she made the buyer close the deal and stay in a hotel for a week-plus.

It’s been a seller’s market for so long now that agents think there will always be another buyer; so if you don’t like the way they treat you, too bad.  Unfortunately, the inventory is so low that buyers are more likely to endure, rather than object.  Usually the agents don’t intend to be so unappreciative, they just don’t know any better.

Enjoy your beating!

Posted by on Feb 15, 2017 in Jim's Take on the Market, Listing Agent Practices | 6 comments