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(760) 434-5000

Carmel Valley
(858) 560-7700
jim@jimklinge.com


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

Mortgage Underwriting After Tax Day

Did you file an extension for your 2016 tax returns, and are trying to buy a house?  Have you released your financing contingency yet?

Here’s what you have to do to qualify for a mortgage:

Yes, “Tax Day” has passed, and lenders and investors must consider filed taxes in their underwriting decision. For example, LHFS issued a reminder regarding 4506 transcripts. Loans dispersed on or after April 18th will require the 2015 and 2016 returns or all the following:

Evidence of filing a Tax Extension (IRS Form 4868-Application for Automatic Extension of Time to File U.S. Individual Income Tax Return) filed with the IRS; Tax liability reported must be compared to the borrower’s tax liability for the previous 2 years as a measure of income source stability & continuance. An estimated tax liability that is inconsistent with previous years may make it necessary to require the current years return to proceed. IRS Form 4506-T Transcripts confirming “No transcript available” for the applicable tax year; and Returns for the prior two years.

If you owe additional taxes and sent in an amount with your extension, don’t be surprised if your lender will want to see evidence of that too.  Also note:

If you are sending in $100 million or more in taxes, I’ll be happy to drive your money to the post office!

Posted by on Apr 23, 2017 in Jim's Take on the Market, Mortgage Qualifying | 0 comments

Transitional Style

Here are the basics of the home decor that is hot today. They call it transitional style because it balances multiple styles, but it’s also the look for those who are in transition – it’s the staging look that buyers see everywhere!

http://www.realtor.com/advice/home-improvement/what-is-transitional-style/

With so many decor styles out there, it can be hard to stick with just one. Modern, rustic, shabby chic, traditional—deciding on the vibe you want for your home can be downright confusing. But here’s the great thing about interior design: Many of these styles overlap, and can actually work really well together. The design world uses the term “transitional style” to describe the type of design that melds two different aesthetics—modern and traditional—into the same room. So how can you bring transitional style into your home? Our experts break it down for you.

Read More

Posted by on Apr 22, 2017 in Jim's Take on the Market, Tips, Advice & Links | 2 comments

NSDCC Actives/Pendings

Historically, we have considered our market to be relatively ‘healthy’ when the actives-to-pendings ratio is around 2.0 – but that thought originated when prices were about half of what they are today!

Here are the stats for the NSDCC detached-home market (La Jolla to Carlsbad):

Reading Date
Actives
Pendings
A+P
A/P
Oct 28, 2015
970
358
1,328
2.71
Feb 1, 2016
788
254
1,042
3.10
Mar 23, 2016
900
399
1,299
2.26
June 21, 2016
1,052
428
1,480
2.46
Aug 17, 2016
1,060
395
1,455
2.68
Dec 4, 2016
886
327
1,213
2.71
Apr 21, 2017
842
427
1,269
1.97

Considering that we have record-high pricing in most areas, it is phenomenal to see so many pendings – and so few actives!

Actives Median Price = $2,350,000

Pendings Median Price = $1,299,000

Only 10% of the actives are under $1,000,000, and 35% are over $3,000,000!

Here are the Actives/Pendings ratios for each area.  If you remove La Jolla and RSF, the A/P = 432/336, or 1.29 to 1!

Area
Zip Code
June
Aug
Dec
Act/Pend Today
Cardiff
92007
2.3
3.5
1.1
15/15 = 1.0
Carlsbad NW
92008
2.0
2.3
1.3
40/34 = 1.2
Carlsbad SE
92009
1.6
2.0
1.9
73/74 = 1.0
Carlsbad NE
92010
0.7
0.9
1.3
23/25 = 0.9
Carlsbad SW
92011
1.6
1.5
1.3
26/24 = 1.1
Del Mar
92014
3.2
2.5
4.9
63/19 = 3.3
Encinitas
92024
1.3
1.8
1.8
87/55 = 1.6
La Jolla
92037
4.8
4.4
4.4
172/46 = 3.7
RSF
92067
8.2
6.3
6.3
207/40 = 5.2
Solana Bch
92075
2.9
3.9
2.7
19/13 = 1.5
Carmel Vly
92130
1.5
1.8
1.8
86/77 = 1.1
All Above
All
2.5
2.7
2.7
842/427 = 2.0

WOW!

Posted by on Apr 21, 2017 in Actives/Pendings, Jim's Take on the Market, North County Coastal | 0 comments

Failed Auction?

The no-reserve auction of Matt Kemp’s house in Poway today was postponed until April 25th.

Why would you postpone for 5 days?

There has to be buyers. This company has been very successful in selling seven and $8-figure homes throughout the world, and they have grown exponentially. The auction process is a big hit, and it is the best solution for selling homes.

George guessed that it could be a failed auction before I saw it get postponed on the website.  He’s looking very astute now….or is George an insider? 😆

Save

Save

Posted by on Apr 20, 2017 in Auctions, Bubbleinfo TV, Contests, Jim's Take on the Market, View | 8 comments

Live Auction April 20th

The auction of Matt Kemp’s house in Poway is Thursday!

You can watch the auction live at 4:00pm Pacific Time on the Concierge Auctions mobile app, where you can also find their rules list.  They will add a 10% buyer’s premium to the winning bid to determine the final sales price.  If you didn’t know that and want to change your bid, feel free!

Kemp has $12,000,000 invested.  The person with the closest guess will receive four tickets to a Padres game!  Here are the guesses:

$4,200,000 – Rob

$4,735,000 – BAM

$5,325,000 – Amy

$5,700,000 – elbarcosr

$5,900,000 – Real Estate Rookie

$6,200,000 – Nick LB

$6,250,000 – Tom

$6,500,000 – LT

$6,519,000 – Matt V.

$6,900,000 – Daniel

$7,050,000 – Susie

$7,126.000 – Ed

$7,350,000 – Mark H.

$7,423,200 – Goughy

$7,875,000 – Kerry

$7,900,000 – kman

$8,000,000 – Name

$8,800,000 – Mike M.

$8,888,888.88 – JakeL

$9,100,000 – Lifeisradincarlsbad

$9,210,000 – CJ

$9,400,000 – Derek

$9,500,000 – Joe k

$9,600,000 – Mike Call

$9,750,000 – bode

$9,800,000 – Jenny

$10,000,200 – Janet

$10,527,000 – Eddie89

There is still time – leave your guess in the comment section below.

Here are more details on the house:

http://www.bubbleinfo.com/2017/03/27/contest-4-padres-tickets/

Save

Posted by on Apr 19, 2017 in Auctions, Contests, Jim's Take on the Market | 16 comments

Offering Too Low

Part of a realtor’s job is to help manage expectations – not only those of their own clients, but expectations of the other agents and their clients too.

Recently I received an offer on a listing that was 25% under the list price.  They also wanted my seller to carry the financing for 30 years – which is unheard of – and oh yeah, it was contingent upon the sale of the buyers’ home too.

I told the agent (whose email-signature noted they were in the Top 10 statewide for their company) that if I was the seller and that offer was presented, I’d fire my agent.

Just like when we’ve seen a home with range-pricing that is too wide, it becomes impossible to bridge the gap – for three reasons:

  1.  Once a buyer puts a number on paper, their mind starts believing it’s real.
  2.  Buyer’s remorse is real too, and they cool off quickly.
  3.  Sellers are skeptical, and don’t feel like negotiating much.

It may be discussed as just a place to start, but once a buyer submits their price in writing, it becomes a comfortable number.  Going much higher than where they start is usually a function of how fast agents respond.  My rule-of-thumb is two counters max for each side, in less than four days.

In this case, my sellers weren’t desperate, they had already determined that they wanted to sell for at least 93% of list and were willing to wait for it.  I told the buyer’s agent that our price gap was too big, and I nicely asked the agent and buyers to go back to the drawing board.

Three days later, I received a new offer with bank financing, instead of seller-carry, but it still had the original price of 25% under list. It came with the buyers’ love letter; a full-page of reasons why my listing was the perfect fit for the buyers.

Was the love going to make the looming price gap surmountable?

In spite of houses around the county selling for 99% of list this year, we countered with a price that is 4% under our list – not bad, considering the original offer price.  On their counter, the buyers came up to 82% of list, but it took two days to arrive.  I knew the remaining price gap and time left wasn’t looking good.

I always want to respond promptly, because of #2 above – buyers cool off quickly.  We dropped another 2% within a few hours, but it wasn’t enough.  Two days later, the agent emailed that they lost interest – no counter, no love.

Five days gone by (seven days since the original offer), and the initial 25% gap killed our chances.  They knew before writing the offer that it would take at least 93% of list to buy the property, and they still offered – so initially there was some willingness to pay that or close.

If they would have started at 82% of list, and trimmed the time spent to 3-4 days, could we have made it to escrow?  I think so!

Posted by on Apr 18, 2017 in Jim's Take on the Market, Realtor, Realtor Training, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 4 comments