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Category Archive: ‘Thinking of Selling?’

Boomer Liquidation Sale On Hold

The baby boomer liquidation sale has failed to materialize….so far.  Boomers are holding onto their old homes longer, and living the good life instead:

LINK

Baby boomers are not leaving the homes they own to settle into apartments, as housing economists had predicted.

A new edition of Fannie Mae Housing Insights says that boomers are not responsible for a recent surge in the apartment market. But when they do finally downsize, the very size of the generation will be enough to “move markets.”

Predictions were that boomers, the generation born between 1946 and 1965 (some sources say 1964), would begin downsizing naturally as they became older and more frail. “The research showed that the likelihood of Baby Boomers occupying single-family homes has changed little in recent years, despite the factor that boomers are experiencing major life changes that might be expected to cause a downshift in their housing consumption,” the Fannie Mae article said.

Instead, through 2013, boomers had not significantly reduced the rate at which they live in single-family, detached houses, the agency said. And although the number of rooms in those houses has decreased in recent years, “boomer home size has increased since then, suggesting the boomers are not trading down to smaller single-family homes, either.”

The article added that the “number of boomer apartment dwellers has not budged in recent years, whereas the number of millennials in multifamily rental units has grown by nearly half a million annually.”

That’s a significant finding with big implications for the housing market, because “boomers have an enormous residential footprint.” Some 40 percent of the nation’s homes are occupied by boomers, who have “half of the nation’s housing wealth,” Fannie Mae said.

As baby boomers move into their retirement years, they’re having a major impact in other ways, too.

“After working most of their lives, Baby Boomers want it all in retirement: travel, dining out, owning two cars and multiple homes. And they want to do this off of income generated by their investments,” said a recent article in Wall Street Daily. “Yet you’d be amazed how many people go to see an advisor with far too little in savings or investments to enjoy that sort of retirement. Even those people who have enough assets often have them allocated extremely poorly.”

Some boomers have accumulated no savings for retirement, the article said.

Read full article here:

LINK

Posted by on Aug 31, 2015 in Boomers, Jim's Take on the Market, Market Conditions, Thinking of Buying?, Thinking of Selling? | 11 comments

Realtor.com is Gaining Viewers

In San Diego, Realtor.com gets our listings automatically uploaded directly from the MLS, where Zillow and Trulia do not.  If you don’t see listings there, it’s because agents don’t know they have to upload manually, or prefer not to use Zillow/Trulia.  Realtor.com is counting on the synergy between the NewsCorp assets to help propel more growth – a discussion:

Posted by on Aug 27, 2015 in Jim's Take on the Market, The Future, Thinking of Buying?, Thinking of Selling? | 0 comments

Frenzy vs. Frenzy Sales Overlay

Every day we hear some pundit talking about the latest real estate bubble forming.  Can we learn anything from comparing recent sales to those during the bubblicious 2004-2007 era?

graph (56)

Sales were dropping precipitously in 2005 and 2006 after the 2003-2004 run-up.  There was one last blowout at the end of 2006 and into 2007 when Countrywide began pushing the no-doc, 100% financing up to $1,500,000.

When Angelo took away the punch bowl in the middle of 2007, the party was over – you can see how sales tanked, beginning in August, 2007.

One big difference when comparing these two eras is that the neg-am teaser rate in 2007 is today’s 30-year fixed rate.  When the teaser rate went away, and people had to qualify again, the market collapsed.

It doesn’t look that way today.

This year, sales have been strong, in spite of the San Diego Case-Shiller Index rising 42% since January, 2012.  If we hit an unsustainable stretch, the first indicator will be sales dropping off, like they did at the end of 2007.

Posted by on Aug 22, 2015 in Bubble-Era Pricing, Frenzy, Jim's Take on the Market, Market Buzz, North County Coastal, Thinking of Buying?, Thinking of Selling? | 4 comments

Fall 2015 Reality Check

LA

We can talk, can’t we?

Houses that have been on the market for more than 60 days (which includes 507/1,079 = 47% of NSDCC active listings) missed the hot season.

Buyers presume,

“If it hasn’t sold by now, something is wrong with the house, or the price.”

Some people use the days-on-market statistic has a primary search feature. Even if the list price has been reduced, just the longer market time can cause buyers and agents to miss the longer-listed properties.

So not only are those listings easier to pass up, the buyer pool in general is shrinking due to the time of year.  It’s too easy for them to pack it in.

It’s going to get tougher for the older listings to find a buyer, unless they get aggressive on price.  But how many sellers will knock 5% to 10% off their price?  Not many.

Hypothesis:

1.  The list price has to be at least 10% wrong if not selling for months.

2.  Most unsold listings aren’t that far off.  Buyers would be interested in many of the active listings at 10% to 15% under list.

3.  Sellers are reluctant to chop that much off their price.

4.  Buyers have to take the initiative.

My game plan here:

Posted by on Aug 20, 2015 in Bubbleinfo TV, Listing Agent Practices, Market Conditions, North County Coastal, Thinking of Buying?, Thinking of Selling?, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 2 comments

Preparing Your Home to Sell

2015-08-13 13.31.13

Here’s the best reason to fix and clean your house before selling.

It is irresistible for buyers to add up what they think needs to be fixed, and subtract it from your price.  I-R-R-E-S-I-S-T-I-B-L-E.

Some make a sport of it, with both husband and wife scurrying around to see who can find the biggest flaws – and then attach an approximate cost to fix.

But their number is usually double the actual cost, because they aren’t that familiar with the costs, plus they add extra for the hassle factor too.

If a seller is going to get dinged for the damages anyway, they might as well fix them in advance to help the chances of selling for top dollar.

“Can’t we lower the price instead?”

Buyers don’t want to give sellers any credit for pricing in the condition of the home.  If it needs work, they want a break on the price.  They want to deduct their cost expectations from whatever the list price is, and then double-ding you again once they complete their home inspection.

This didn’t matter as much during the frenzy.  But from here on out, we will be experiencing less-than-frenzy conditions.

P.S. I was serious about removing half of the contents.  Most houses are full of the sellers’ valued possessions, but they look like junk to everyone else.

My specific tips here: Tips on Preparing Home for Sale

Get Good Help!

Posted by on Aug 15, 2015 in Jim's Take on the Market, Listing Agent Practices, Thinking of Selling?, Tips, Advice & Links, Why You Should List With Jim | 0 comments

Pricing Gauge for Home Sellers

2015-08-05 13.02.48

Almost half of the active listings in NSDCC have been on the market for more than two months.  They have missed the ‘selling season’, and the sellers are now left wondering when/if that happy couple with 2.2 kids will come along.

Over the last two years we’ve been in a rapidly-appreciating market, and sellers only had to wait for prices to catch up.  But now that prices have been fairly flat, the wait could last forever.  It is a real possibility that this is will be the peak for the foreseeable future.

If you are patiently waiting for the ‘right buyer’ to come along, no problem.  But for those sellers who want some real guidance about what it will take to get your home sold in the next few weeks, consider my pricing gauge:

Common-Sense Pricing Gauge:

A.  If you are getting offers, then your list price is about right.

B.  If you are getting lookers, but no offers, then your list price is about 5% to 10% too high.

C.  If you don’t have any buyers looking at the home, the price is more than 10% wrong.

Buyers are addicted to the days-on-market statistic, which is out in the open.  For every week your house is on the market, buyers are mentally subtracting about 1% from your original list price.

As a result, sellers should lower their price by 5% every 2-4 weeks until they start getting offers.

An exciting price creates urgency and enthusiasm among both buyers and agents.  Without it, your listing goes stale quickly, usually after two weeks – and after that, many of the showings are for comparison to help agents sell the better-priced house down the street.

Posted by on Aug 13, 2015 in Jim's Take on the Market, Listing Agent Practices, Thinking of Selling?, Why You Should List With Jim | 0 comments

House-Price Torpedos

Their agents are telling buyers to wait…but wait for what? Wait how long? Wait for who?  It’s irresponsible to make such casual comments.

Not mentioned in this article is that a good agent can overcome all these obstacles, and a bad agent makes them worse:

http://money.usnews.com/money/personal-finance/articles/2015/07/30/9-factors-that-can-torpedo-your-homes-selling-price

Posted by on Aug 1, 2015 in Jim's Take on the Market, Market Conditions, Thinking of Selling?, Why You Should List With Jim | 2 comments

House Lottery

The first few house lotteries were shut down due to their gambling nature, but now there are new twists.  First it was the flipper who is unloading a 1906 Craftsman-style home to the person who submits $100 and the best dessert-recipe HERE

Now these folks in Phoenix who paid $350,000 for their house want you to submit an essay and $150 to have a chance to win their flip:

http://www.housefor150.com/

lucia

From KTAR – click HERE for link:

PHOENIX — Valley residents with an extra $150 lying around might want to think about investing that in real estate.

That money could actually go a long way as a Phoenix real estate investor says that’s all it takes to have a shot at purchasing one of his properties.

“We purchased the house with the sole intention of making it beautiful and selling it for profit,” said Erin O’Connor.

O’Connor intends to make a profit by selling the nearly 4,000-square-foot, five bedroom home at 6517 W Lucia Dr. through an essay contest that costs $150 to enter.

Any adult can submit an essay up to 250 words, O’Connor will then narrow the essays down to the best 300 and an attorney will pick the final winner.

“If you win the essay contest, then you’re given the exclusive right to purchase the home for $10 and your normal closing fees,” he said.

Those title and escrow fees are estimated to be roughly $3,000, according to O’Connor’s website.

O’Connor said there needs to be a minimum of 4,500 essays submitted for the contest to be valid and only the first 5,500 will be accepted. That ensures at least $675,000 in revenue for the home and at the most, $825,000.

Michael Weinstein of the YourRealEstateWorld.com team at West USA Realty wrote in an email the property has an estimated value of $418,210, so 2,788 entries would be needed to simply break even on the property.

Weinstein called it a fun idea for those that have the resources but was skeptical about the business model for sellers. O’Connor however, said he hopes it is a business model that not only works, but also will catch on.

“I do believe that it could catch on (and) we could make a business out of it,” he said.

A portion of the revenue from the essay entries will go to benefit St. Jude Children’s Hospital, O’Connor said.

Posted by on Jul 30, 2015 in Ideas/Solutions, Listing Agent Practices, Thinking of Selling? | 3 comments

Chances of Selling

I have two RSF listings that are outside the Covenant.

One seller asked me what the chances are of selling.

I said 20%, to which he said, ‘Yikes’.

But any RSF listing only has a 30% or 40% chance of selling.  There were 436 listings, and 127 sales (29%) last year in the 92067.

Here are the detached-home total listings and sold listings from 2014:

Area or City
Zip Code
2014 Listings
2014 Solds
Percentage
Cardiff
92007
130
80
62%
Carlsbad NW
92008
302
214
71%
Carlsbad SE
92009
789
525
67%
Carlsbad NE
92010
201
132
66%
Carlsbad SW
92011
336
209
62%
Del Mar
92014
306
193
63%
Encinitas
92024
646
405
63%
La Jolla
92037
637
321
50%
RSF
92067
436
127
29%
Solana Bch
92075
152
82
54%
Carmel Vly
92130
673
470
70%
All Above
Total
4,608
2,758
60%

Listings in the Ranch are the least likely to sell – by far.

What can a listing agent do to help the cause?  State your case on value.

It’s always tough to estimate the value of unique or custom homes – but those in the Ranch have so many variables it will make your head spin because every property is so different.

As listing agent, it’s my job to justify the value.

If the purchase is financed, then an appraisal needs to be completed.  Even though the sales price will have been given to the appraiser in advance, it’s still the listing agent’s job to make sure they hit the number.

As long as we gathered comps in the beginning to justify our recommended list price, and we have the need to deliver same to appraiser, we might as well include them in the listing to help buyer agents come to the right conclusion.

My case to support the $2,795,000 list price of 7060 Via Del Charro:

7060 Via Del Charro comparable sales

Posted by on Jul 25, 2015 in Jim's Take on the Market, Listing Agent Practices, Rancho Santa Fe, Thinking of Selling?, Why You Should List With Jim | 1 comment