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Category Archive: ‘Why You Should List With Jim’

Real Estate ADD

iP

The iPhone 7 is out!  Smart phones and other mobile devices now dominate the landscape, and are practically part of the family.  Thankfully, they don’t need their own bedroom and bath!

Most people scroll so quickly that they only take split-seconds to decide which homes to consider.  Having limited inventory might be a good thing!

The first impression of the home needs to be incredible just to capture their attention for a few seconds.

Home Selling in the Mobile-Device Era

  1.  Staging – The photos are already small enough on these phones – they become much more appealing with the right decor.  Once the buyers arrive for their minutes-long tour, it’s easier for them to visualize too.
  2.  Pro Photos Only – Buyers are frustrated enough, and they won’t tolerate poor-quality photos. It’s too easy for them to keep swiping.
  3.  Colors need to be current.  In the minds of fast-moving buyers, out-of-style colors = fixer.
  4.  Powerful Remarks – Listings with the usual mumbo-jumbo in the remarks won’t get read.
  5.  Responding to Inquires – Zillow recommends that agents respond to inquiries within five minutes – otherwise, consumers will forget the property!
  6.  Comps – Buyers are moving (too) fast, and there aren’t as many sales so it’s tougher to track the values easily.  Give them a hand – list the comps in the remarks!
  7.  Sell with Less – Don’t include 25 photos of beddings and local attractions.
  8.  Old Listings are Toast – Buyers ignore old listings – they want new meat.

This is the era of sensory overload.  There are so many advertising images coming at us every second that our go-to is to ignore first.  But those clear, clean, sleek, easy-to-read listings with great photos and an attractive price still have a good chance of selling!

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Posted by on Sep 17, 2016 in Jim's Take on the Market, Listing Agent Practices, Tips, Advice & Links, Why You Should List With Jim | 0 comments

DOM Matters

dom

Our local market has been healthy/strong since 2009, with virtually every property in North San Diego’s Coastal region having risen 30% to 50% in value.

But the slowdown is here, which probably means prices are going to flatten out.

Sellers and agents who priced too high over the last few years just had to wait “until some nice family came along”.  But the reality was prices were rising fast enough that they eventually caught up.

But what happens in flatsville?  Prices take much longer to catch up – if they ever do.  With mortgage rates at record low levels – can market conditions be any better than what we’ve seen lately?  Probably not.

The days-on-market is going to matter now.

Buyers have been willing to ignore the longer DOMs because they knew prices were rising fast – and they were frustrated.  But in a slower market, buyers gain confidence and don’t mind waiting to see how it all shakes out.

Bottom line?

You want to sell in the first 30 days on the market.

The pricing history of each house, and the amount of time it’s been on the market is public knowledge.  Once you roll into flatsville, the homes languishing on the market for months will get ignored.  Buyers are more skeptical, and the longer a house is on the market, the less they want to pay!

Other things will matter too. Curb appeal and interior improvements, ease of showing, reputable listing agent, and attractive price will all be scrutinized closely by prospective purchasers who are looking for any reason NOT to buy.  Staying on the fence will become the new sport.

Is it a big deal?  Not to those who don’t need to sell. Buyers will still come around, and you might get lucky.

But rising prices have been provided the ‘luck’ because they caused buyers to ignore market signals – they just wanted to buy something before it got worse.

The shift in the market is subtle, and many won’t notice.

But the educated buyers are paying attention, and now hesitating over the little stuff.  The number of days on the market will be their primary data point, so do everything possible to ensure a prompt sale!

Get Good Help!

Posted by on Sep 16, 2016 in Jim's Take on the Market, Market Conditions, Why You Should List With Jim | 1 comment

‘Soft’ Market

I showed 20-25 properties to buyers over the weekend, which always makes me cringe because I know what will follow – those incessant ‘feedback’ requests.  In a hot market, they come by email – listing agents don’t care what you think then, because they know the property will be selling any minute.

But these days you get phone calls.

The calls usually come from assistants, and, for the most part, they don’t care what the feedback is, they just need to write something down.

But occasionally the actual agent will call, which hopefully means somebody has some real motivation over there.  I like to turn these into two-way conversations and ask questions to see if the agent might be realistic.

Agents love to gush about how many showings they’ve had, and as a result, how a sale must be right around the corner.  You and I know that a lot of showings but no offers means a lot of buyers not interested – at least not at this price.

But most agents are slow to accept that reality, so I’ll follow it up by suggesting that the market must have turned soft and see what they say.  You can’t assume that it’s obvious to everyone, even those in the business.  Besides, after the run we’ve had, most realtors think the market is soft if they don’t get multiple offers in the first week!

But what is a ‘soft’ market?

From Investopedia:

DEFINITION of ‘Soft Market‘ – A market that has more potential sellers than buyers. A soft market can describe an entire industry, such as the retail market, or a specific asset, such as lumber.

This is often referred to as a buyer’s market, as the purchasers hold much of the power in negotiations.

The market will feel ‘soft’ to sellers and agents who are getting showings but no offers.  They will blame the ‘market’, as if the problem is outside of them.

But we know what the real problem is – sellers got a little too enthusiastic about their list price, and buyers are now balking.  For example, see below.

sept

Most agents are reporting no offers on their listings, and you can see why.  There isn’t enough pricing momentum to propel buyers to keep paying more.

How soft is it?

Probably 5% to 10% – but do you deduct from today’s lofty list prices, or from the last comps?  Results may vary!

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Posted by on Sep 8, 2016 in Jim's Take on the Market, Market Buzz, Market Conditions, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 0 comments

Tiffany House

tiff

Check out our new Encinitas listing – 720 Lotus Blossom! $899,900!

Terrific Fieldstone home w/good curb appeal and many recent upgrades! Newer dual-paned windows & sliders throughout, plantation shutters & wood blinds, new and classy marble, travertine, and granite bathrooms, remodeled stainless kitchen and very private back yard! No HOA or Mello-Roos fees!

Kayla and I will have it open 12-3pm on Saturday, September 3rd!

http://www.zillow.com/homedetails/720-Lotus-Blossom-St-Encinitas-CA-92024/16716990_zpid?

lotus map

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Posted by on Sep 1, 2016 in Bubbleinfo TV, Encinitas, Jim's Take on the Market, Listing Agent Practices, Open House, Why You Should List With Jim | 0 comments

Fall Buying Season

Image result for fall leaves color

The last third of 2016 starts on Thursday!

From Trulia:

http://www.trulia.com/blog/best-things-about-fall-real-estate/

For the first time in recent history, October surpassed June as the most popular month to get married. And these autumn-loving brides may be on to something: Although the spring months are notoriously the best time to buy real estate (as well as have a wedding), fall may be the new ideal season to buy a home.

Here are seven insights on why you should buy a home during the fall season:

1. There’s less competition

Competition for houses drops off in the fall, a time many people consider to be off-season in real estate. But there are still homes for sale — and in some cases, there’s just as much inventory as there was during the spring and summer. “[Fall] means new inventory and repositioned old inventory that did not sell in the prime season,” says Wesley Stanton, a New York, NY, agent with The Stanton Hoch Team.

This puts you in a great position to negotiate. “Fall homebuyers should consider making lowball offers, followed by more aggressive negotiation,” says Brian Davis, a real estate investor and director of education at Spark Rental. Davis points out that many sellers are very motivated to sell before the holidays. If possible, buyers should let these sellers know that they can close before Thanksgiving or before the school winter break.

2. Sellers are worn-out

Some sellers who put their homes on the market during the prime selling times of spring and summer might have been a tad overconfident by listing their homes for more than buyers were willing to spend. After months of no action, these sellers are often ready to make a deal.

“Sellers who were unrealistic earlier in the year about price will now be more willing to reduce the price come fall,” says Thomas Miller, a Washington, DC, real estate agent. “Because there [are fewer buyers] and because the sellers are now eager to sell, they are more inclined to take the low offer than wait another six months for spring to come around.”

3. Sellers are serious

Not all homes on the market in fall are summer leftovers. Some people need to sell in the fall because the timing is right. Maybe they were having a home built, and it’s now ready. Maybe they need to move because of a job. “The sellers with houses on the market in the fall tend to be serious,” says Sam Heskel, president of Nadlan Valuation, an appraisal management company in Brooklyn, NY. “That means sellers could be more open to negotiating and accepting a lower offer.”

4. You can take advantage of tax breaks

First-time homebuyers, take note: Although you can’t escape paying income tax, you can make a dent in what you owe when you become a homeowner. “Property tax and mortgage interest are both deductions you can take for your whole year’s worth of income, even if you closed on your home in December,” says David Hryck, a New York, NY tax adviser, lawyer, and personal finance expert. “Any payments that are made prior to the closing of the loan are tax-deductible. This can make a serious difference in the amount you owe the government at the end of the year.”

5. Fall is a safer time of year

Did you know that burglars have peak seasons? They do, says Sarah Brown, a home safety expert for SafeWise.com. “July and August are prime months for burglaries to take place,” she says. “Waiting until the fall [to buy] gives you an advantage when learning about a home and the neighborhood.” You’ll be settled in your home and can take precautions — like setting up that new alarm system — before the next burglary season rolls around.

6. You’re the center of attention

Because spring and summer are ideal times to buy a home, real estate agents are usually busier then. And that could mean you might not always get the attention you want. This is also true for other professionals you’re working with to buy a house. “Service providers, such as mortgage lenders and title companies, are moving out of the summertime sales swamp and can often respond more quickly,” says John Lazenby, president of the Orlando Regional Realtor Association in Orlando, FL.

The same goes for movers. “Because summer is peak moving season, people often experience more delays and service issues, such as moving companies reaching capacity and running out of trucks to pick up shipments,” says Jack Griffin, president and chief operating officer of Atlas World Group. “The probability of experiencing a delay goes way down in the fall season.”

7. You can take advantage of end-of-year sales to outfit your home

There are bound to be improvements you’ll want to make after buying a house. You’ll also probably need to buy items to maintain your home, and if appliances weren’t part of the deal, you’ll need those too. Wouldn’t it be great to coordinate your home purchase with sales on items you’ll need? According to Consumer Reports, the calendar determines when it’s a good time to buy all sorts of consumer goods. In particular, September is a great time for buying carpet and paint. October means lawn mowers go on sale, and appliances and cookware are cheaper in November.

http://www.trulia.com/blog/best-things-about-fall-real-estate/

Posted by on Aug 29, 2016 in Jim's Take on the Market, Thinking of Buying?, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 2 comments

Existing Home Sales, July, 2016

nar

Our N.A.R. head cheerleader does his best at fabricating a believable story behind the 3.2% drop in existing-home sales:

Lawrence Yun, N.A.R. chief economist, says existing sales fell off track in July, after steadily climbing the last four months.  “Severely restrained inventory and the tightening grip it’s putting on affordability, is the primary culprit for the considerable sales slump throughout much of the country last month”, he said. Realtors are reporting diminished buyer traffic because of the scarce number of affordable homes on the market, and the lack of supply is stifling the efforts of many prospective buyers attempting to purchase while mortgage rates hover at historical lows.

He needs to follow me on twitter.  I’ve already pointed out twice that there were 9% fewer days in July than in June – and sales only dropped 3.2%?  Sounds like a positive to me.

But instead he feeds his typical bather to America, and leaves it up to the consumers what to make of it.

He should also point out that 2015 was a hot market, with summer sales exceeding those during the super-frenzy of 2013.  Yet sales over the last four months have been close or surpassed those in 2015!  Even with the two fewer days, look how July, 2016 compares to previous years – it was better than 2013!

Yunnie needs say, “Remember, real estate is local”, to end all of his speeches.  This national data and his blunder of an explanation shouldn’t have any impact on local market conditions.  But they could make a difference if casual readers just grab a headline and decide to pack it in for the year.  Thanks Yunnie – you’re supposed to be on our side!

The local scoop:

Detached-Homes
July, 2013
July, 2014
July, 2015
June, 2016
July, 2016
NSDCC # of Sales
297
271
313
298
262
NSDCC Median SP
$930,000
$1,018,000
$1,025,000
$1,204,500
$1,125,000
SD Co # of Sales
2,401
1,992
2,437
2,360
2,151
SD Co Median SP
$480,000
$513,750
$550,000
$565,000
$562,000

NSDCC detached-home sales in July dropped 12% compared to June, with 9% fewer business days. With higher prices, sales should be declining – and for them to drop a net 3% sounds good to me. House sales in San Diego County dropped 9% month-over-month – let’s call it even.

P.S. Regarding his comment that realtors are reporting diminished traffic, it’s because you are sitting on over-priced listings. Lower the price and get in the game, or go get another listing!

Added later – looks great:

months supply

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Posted by on Aug 24, 2016 in Jim's Take on the Market, North County Coastal, Sales and Price Check, Why You Should List With Jim | 3 comments

Avoiding the BOM

When thinking about selling your home, do you have concerns that a sale could blow out and leave you hanging?  Have you heard stories from others like that?

It is a real concern.  If a deal blows out, the sellers have to go through the hassle of showing the house again, and the listing agent has to find a way to re-ignite the urgency.

What are reasons for a cancellation?

  1. Buyer didn’t like being worked over by the seller and listing agent during the negotiations, and is looking for any reason to cancel.
  2.  The house is in worse condition than expected.
  3.  Sellers won’t do enough to satisfy the buyers’ request for repairs.
  4.  HOA docs reveal conditions that are overly-restrictive.
  5.  The buyers’ family squashes the deal.

Our contracts create a legally-binding agreement, and the sellers are locked in – you can’t cancel.  Wouldn’t you want to do as much as possible to lock in the buyer before signing?

There are two easy things for sellers and listing agents to do to drastically cut down the chances of a sale cancelling:

  1. Have buyers also qualify with your lender of choice.  Deals can cancel later from lending factors that were unknown in the beginning, but typically those were unknown because the lender was inexperienced and didn’t see them coming.
  2. I love the new practice of sellers providing a pre-listing home inspection report.  Include the HOA docs, termite, and title report too – up front!

About the only thing left is the appraisal, but because you had an attractive price from the beginning, the value shouldn’t be too hard to substantiate.

I just had one where the inspector drove up in a $500 car, spent seven hours doing his inspection, and finally produced his written report a week later!  Of course, he says the house is falling down!

This sale hasn’t cancelled yet – we are busy on supplying our own reports and demonstrations to offset the inspector’s findings.  I should have gotten my own report in the beginning!

We’ve been doing it backwards all these years – supplying the due-diligence materilas from the start is a great way to avoid cancellations!

Posted by on Aug 3, 2016 in Jim's Take on the Market, Listing Agent Practices, Tips, Advice & Links, Why You Should List With Jim | 3 comments

Comps Are Tricky

comps

Summer is wrapping up, which is a tricky time of the year to estimate the value of a home using comps from the last six months.  Sellers and agents are happy to tout that they “have comps”, but those sales from the hot spring selling season may not translate the same in the off-season.

Here are the concerns with using springtime comps in the fall:

  1.  More competition = slightly higher prices in spring.
  2.  Buyers expect softer prices in the off-season.
  3.  Buyers have seen the comps – have you?
  4.  Any newer comps will offset, and be more important.

Besides……if you ‘have comps’, then why isn’t it selling?

At first, most sellers are addicted to getting more than the last guy.  But as weeks or months go by, you have to re-calibrate – ‘having comps’ isn’t enough.

Greed can be blinding though, and sometimes it’s just a matter of a few percentage points.  Here’s a recent example:

A house was listed in the high-$900,000s, for which the sellers had paid in the $500,000s a decade ago – and their loan amount was lower.

The listing agent boasted that not only did they have comps, but they had already received four offers, the highest of which was $950,000.

At that price, the sellers could have walked away with their $500,000 in equity tax-free, but that wasn’t enough.  Instead, they are holding out for that extra $10,000 to $20,000, because they ‘have comps’!

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Posted by on Aug 2, 2016 in Jim's Take on the Market, Listing Agent Practices, Why You Should List With Jim | 3 comments

Long Listing = Inflated Price

code

How about the agents who deliberately over-price their listings?

It’s not the mean and nasty ‘deliberate’; it’s more of a friendly wink and a nod. Sellers want more money, not less, and it’s irresistible for them to hire the agent who quotes them the highest price.

Agents who ‘high-ball’ to get the listing leave a tell-tale sign.  They insist on 6-12 month listings, which means they have no confidence in the price today, and are just praying they get lucky.

But let’s check the N.A.R Code of Ethics:

  • Standard of Practice 1-3

REALTORS®, in attempting to secure a listing, shall not deliberately mislead the owner as to market value.

The key word is ‘deliberately’, and here is the definition:

Carefully weighted or considered; studied; intentional

Agents who intentionally high-ball their price to get the listing leave evidence.  They insist on a long listing period.  But if you had confidence in your price, why the long listing?

Is high-balling a problem?

Yes – if the Code of Ethics means anything.  Agents should be ethical and rely on demonstrating their skills to get the listing, and not buffalo the sellers by deliberately quoting an unrealistic price.  But agents get away with it because there is no enforcement, and as long as prices trend upward, eventually the market catches up with their price.

How can we inflict the Code of Ethics on agents? If there was a limit to the maximum number of days (90-120) of a listing, then all agents would have to be sharp on price.  The quoted prices would all be about the same, which would shift the sellers’ focus to who has the best skill set to achieve a top dollar sale.

As the market enthusiasm wanes in the second half, this will matter more as the tide goes out on the high-ballers.

After months of trying, they will blame their failure on the ‘market’, and then push for a price reduction.  But the buyers have caught on by then, and it will take a bigger drop just to get their attention.

Everyone believes that it takes a long time to sell an expensive house.  Really?  Have you checked the stats?

The 176 NSDCC houses priced over $2,400,000 that sold in the last six months had an average DOM of 80 days, and a median DOM of 58 days!

Let’s compete on a level playing field and see who wins!

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Posted by on Jul 21, 2016 in Jim's Take on the Market, Listing Agent Practices, Why You Should List With Jim | 2 comments