In April, 2009, the ABC News Nightline show followed as we looked at buying some fixers in Oceanside (links are in the right column under REAL ESTATE VIDEOS). Here is a follow-up:
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Jim Klinge
Klinge Realty Group
Are you looking for an experienced agent to help you buy or sell a home?
Contact Jim the Realtor!
- 682 S. Coast Hwy 101, Suite #110
Encinitas, CA 92024 - (858) 997-3801 call or text
- klingerealty@gmail.com
CA DRE #01527365, CA DRE #00873197
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Trustindex verifies that the original source of the review is Google. We sold a home with Jim and Donna and from beginning to end they were consummate professionals. Their initial walk through the property resulted in a list of items to be repaired or updated. They supplied a list of vendors and job quotes to do the repairs and updates. We originally wanted to sell ‘as is’ and just get it over with. They gave us a selling price for ‘as is’ and options for doing a few updates/repairs to doing it all with the selling price for each option. We agreed to do all they suggested and we sold for the exact price they predicted. For every dollar spent we got back more than $2 back in the selling price. And they got that price in a rising interest rate environment! Donna and Jim are extremely detailed and guide you through ever aspect of the sale. There were no surprises thanks to their guidance. We couldn’t be more pleased with their representation. Thank you Donna and Jim, Jerry and MaryTrustindex verifies that the original source of the review is Google. We have known Jim & Donna Klinge for over a dozen years, having met them in Carlsbad where our children went to the same school. As long time North County residents, it was a no- brainer for us to have the Klinges be our eyes and ears for San Diego real estate in general and North County in particular. As my military career caused our family to move all over the country and overseas to Asia, Europe and the Pacific, we trusted Jim and Donna to help keep our house in Carlsbad rented with reliable and respectful tenants for over 10 years. Naturally, when the time came to sell our beloved Carlsbad home to pursue a rural lifestyle in retirement out of California, we could think of no better team to represent us than Jim and Donna. They immediately went to work to update our house built in 2004 to current-day standards and trends — in 2 short months they transformed it into a literal modern-day masterpiece. We trusted their judgement implicitly and followed 100% of their recommended changes. When our house finally came on the market, there was a blizzard of serious interest, we had multiple offers by the third day and it sold in just 5 days after a frenzied bidding war for 20% above our asking price! The investment we made in upgrades recommended by Jim and Donna yielded a 4-fold return, in the process setting a new high water mark for a house sold in our community. In our view, there are no better real estate professionals in all of San Diego than Jim and Donna Klinge. Buying or selling, you must run and beg Jim and Donna Klinge to represent you! Our family will never forget Jim, Donna, and their whole team at Compass — we are forever grateful to them.Trustindex verifies that the original source of the review is Google. WeI had the pleasure of working with Klinge Realty Group to sell our home in Carmel Valley, and I cannot recommend them highly enough! Jim and Donna demonstrated exceptional professionalism, offering expert guidance on market conditions and pricing strategy, which resulted in a quick and successful sale. Communication was prompt and we were well-informed throughout the entire process. For anyone looking for a dedicated and knowledgeable real estate team, look no further! ---Trustindex verifies that the original source of the review is Google. Donna and Jim Klinge of Klinge Realty Group have our highest possible recommendation. From Donna and Jim’s first visit to our house through closing their advice and counsel was candid and honest in all dealings. They kept us fully informed throughout the process. The house sold less than three days after listing with a two-week closing. My wife and I have sold several houses during our lives. This was by far the best experience. Klinge Reality is a premium service realtor. You can’t make a better choice for someone to sell your home fast and for top dollar.Trustindex verifies that the original source of the review is Google. Donna and Jim provided exceptional support and professionalism throughout the entire process. We couldn't have been happier with their efforts. They made our house shine, and thanks to their expertise, it sold above the listing price in the very first weekend! Truly a fantastic experience from start to finish.Trustindex verifies that the original source of the review is Google. This year has been difficult on our family, mainly due to having to sell our home. Thankfully we knew God had a plan for us and working with the Klinge team was a key part of it. It was an obvious decision to work with them again after such an amazing experience when purchasing the same home we needed to sell. The challenge was, how will we do this in so little time with so much going on? Jim and Donna held our hand every step of the way. Whenever an unexpected issue arose they found and provided a solution. Never once did we feel pressured to make a decision and the Klinges were always reassuring after providing the information that the decision was ours to make. Despite the curve balls, they never panicked and exemplified the “can do” attitude, making us feel optimistic and taken care of. Their expertise and professionalism was superb. But of all the reasons to work with the Klinges, the most impactful and valuable is their compassion and genuine care for their clients. We pray that we can one day purchase our forever home and you better believe that Jim and Donna will be representing us - as long as they will have us of course. Thank you again Klinge team! Your execution, experience, and care are unmatched.Trustindex verifies that the original source of the review is Google. Jim and Donna were fantastic! Jim understanding my needs, recommending potential places, pointing out the pros and cons of each property was invaluable. Then when the offer was accepted Donna’s organized guidance through the inspections, paperwork etc made the whole process seem effortless. So grateful that I had them on my side!Trustindex verifies that the original source of the review is Google. We first found Jim through his blog at bubbleinfo.com, which really showcased his knowledge of SoCal real estate. Since then we've done three transactions with Jim and Donna, and they are an incredible full service agency, with Jim's deep market insight and Donna's deft contract and project management. We trust them implicitly in their analysis and strategy, which is based on years of experience. They're always available and on top of things, and we strongly recommend them to anyone.Trustindex verifies that the original source of the review is Google. The Good The Klinge Realty Group operates like a finely tuned machine, with a very personal touch. We contacted them on a Sunday and they were talking to us about our family and our needs on our living room couch the following day. They carefully listened to us and worked with us to identify the best and quickest path to listing within 2 weeks to take advantage of the low inventory conditions in our South Carlsbad neighborhood. They knew our tract specifically and had many previous sales there over the years - they came prepared with a thorough analysis of comparative sales and recommended a pricing strategy that they felt confident would yield offers the first weekend on the market. The Great Over the next two weeks Donna coordinated a range of vendors who she knew from experience could get the preparation to list work we needed done on time and with high quality. Our light tune-up involved excellent experiences with their stagers, landscapers, contractors, electricians, and plumbers. Throughout this period Donna's daily communication was clear, concise, and responsive. Any time we had questions Donna picked up the phone or texted immediately - but almost always, she answered our questions before we even knew we had them. The Outstanding We had a tricky situation with a shared fence that could have delayed our escrow. Donna used superb mediation skills to negotiate the terms of replacement and was personally on site with the fence contractor to make sure everything went smoothly. The fence looks great and escrow closed on time. The Truly Exceptional Our house came on the market on a Wednesday and between then and Monday morning Jim was personally at all three open houses. He was in constant communication explaining potential buyer reaction and strength. As he predicted offers began to come in on Saturday and each one was incrementally higher than the last. At the end we had 5 offers, 4 of which were over list, and the final accepted offer was $100,000 over list. In addition to being over list it included rent back terms that met our needs. The Recommendation For all of these reasons we would strongly recommend The Klinge Team to anyone wanting to sell in North County Coastal San Diego. I had been reading Jim's bubbleinfo.com blog for 15 years and knew when the time came to sell that he would be our first call. Jim Klinge is not your standard realtor. He is keenly aware of market conditions and sales strategies. And, works his tail off - though not as hard as Donna . At this point he's gone from realtor to friend and I plan to have him over to grill and chill at our new place to talk real estate, but also just about life and raising kids in San Diego. He's more interested in relationships than his sales numbers - and that's why his sales numbers are so high. We have already recommended the Klinge's to some close friends and another successful sale is on deck right around the corner...Trustindex verifies that the original source of the review is Google. We recently had the pleasure of working with Jim and Donna from Klinge Realty Group to sell our house, and we couldn't be more satisfied with the experience. From the initial meeting, they listened attentively to our needs and provided invaluable guidance on specific improvements to get our home market ready. Their responsiveness throughout the entire process was truly impressive. Anytime we had questions or concerns, they were quick to address them, ensuring we felt comfortable and informed every step of the way. What stood out the most was their team and extensive network of tradespeople, which made addressing any necessary repairs or updates seamless and stress-free. Thanks to their expertise and dedication, our house sold quickly and at a great price. We highly recommend Jim and Donna to anyone looking to buy or sell a home. They are a fantastic team who truly care about their clients and deliver exceptional results.Load more
cool,
so if you can hang on and put up with carrying costs for 90 days, I guess the FHA offers come flying in.
Speechless and if you think I’m going to make a comment about creamy puppies you are crazy.
Thanks, I appreciate that!
I have been hearing rumors that conventional lenders have been initiating a 90 day rule (similar to FHA) for re-sell properties–can anyone confirm?
The old adage of making money when you buy. Good job to their agent at Klinge for finding them five buys already.
You cannot sell FHA for 90 days after purchase to discourage flipping. Obviously they bought in April so that does not matter. They did a great job of improving that property but in the future they should try matching the vanity to the bathroom doors. Little things like that drive me crazy. … I know, I know… picky picky…
It’s official the bubble is back on…
To be fair, that house was really well done. Nothing I would offer 300k on but nicely fixed up.
I feel bad for the buyers that saw everything fixed up and went crazy.
Oh well.. A fool and his FHA 3% down are soon parted.
I have taken additional measures to ramp up, in preparation:
http://www.doublebubbleinfo.com
Jim, is the FHA the new toxic receptacle of mispriced risk backed again by the ever present ignorant taxpayer. Does our govt. want to move houses this bad that they are willing to subsidize every mortgage with more and more tax sweeteners.
When do you as a citizen step back and say my profession is one of the core problems with our country?
Don’t you wonder if risk is being priced appropriately and dont you worry about the us taxpayer?
I would of put in a nice stone spa/BBQ and a fire pit in the back and listed it at $299K.
Pigpen,
I have a fiduciary duty to my client. If what’s best for my client is to sell a house to a buyer who uses low-down financing, then I am compelled to facilitate that deal.
I think I do plenty to educate consumers right here, more than most in the business. Are the buyers being egged on by uneducated agents? Maybe, but the agents are welcome to read along here with you all, and I know many do.
In your opinion is FHA the new govt. sponsored subprime lending machine with Low down payments where most of the risk is on the taxpayer?
I dont begrudge you as this is a bigger policy morality issue. As a taxpaying renter, I don’t like to see FHA being the only game in town that is likely being GAMED.
Just disgruntled and frustrated that we don’t seem to learn from bubbles and our govt is desperate to create new ones.
Great update video Jim. I tend to look down on flipping and flippers, but they really fixed that place up nicely…
But Pigpen does make a valid point about FHA loans.
Jim, agreed you are an honest broker in an asymmetrical risk game with the taxpayer being the patsy. Ask yourself if making almost a hundred grand in 3 months flipping a house to a FHA buyer isnt a bit puzzling?
I guess our new national motto should be KEEPING US ASSET PRICES UP AT ANY COST.
Pigpen,
The FHA loans include a 1.75% vig that the government says will cover losses. So for now the unfairness is to those borrowing via FHA and paying the high fee to cover the few defaulters.
Of course, when that fund is extinguished I am sure that the taxpayers are next in line.
I don’t begrudge Jim making a living, or these flippers making a flip. I applaud them. I wish we had more agencies like Jim’s.
What drove me over the edge just about the time my daughter was looking to buy her first home in California, was that “flipping” and the whole cast of supporting players-many with criminal intent and backgrounds-took over much of the real estate profession and the process of buying a home. They corrupted the process and artificially drove up the price of homes (of course none of this would have happened without the intervention of the Fed. Reserve, Fannie/Freddie, etc).
I’m hoping the good realtors like Jim are able to hang on and make a decent living. I’m confident they will. At the same time I’m hoping the people who have no business anywhere near a real estate contract are driven out of business, or just leave.
Since we don’t seem to have responsible institutions anymore (govt., associations, etc.) that work to weed out the worst offenders, or put them in jail when it’s warranted, it seems brute, market forces are going to have do the necessary house cleaning in the real estate/home building profession.
“As long as you buy right, you can’t lose.”
Sorry Jim, but I don’t think “you can’t lose” should be in your vocabulary. That’s what everybody believed before the crash!
I would say as far as Doublebubble goes, if we are not down far enough yet, so when are the builders going to start building again, and again what happens when For all practical purposes builders stop building for three years ??
Realist, I have to disagree.
The expression: “As long as you buy right, you can’t lose” is always 100% correct in hindsight. Betting on the ponies is also a guaranteed way to make money if your horse wins the race.
The problem is not the flippers (assuming they are honest in/on their paperwork), but the goofball government policy of raising/propping up housing prices through whatever means possible (e.g. interest rate deductions, $8K tax credit, free FHA money, bank bail outs, etc). If the government props went away, housing would be cheaper and more affordable for the people who can least afford it, and flippers would have to pay cash (and some do!).
There’s little (nothing?) that government cannot F up. Cash for clunker houses!
Irene, I agree with you about the bathroom doors not matching the vanity…it looks terrible. They should have found a way to get those vanities in a similar cherry finish to match. The doors are gorgeous — shame they didn’t think to match all the wood throughout the house to that cherry.
Wow, that worked out nicely. More power to Joella and company for doing a good job and getting justly rewarded for it.
Goes to show that “riding the wave” can be a winning formula even if the wave is a rogue one.
It looks nice – but is it my imagination, or is the kitchen sink “off?” It looks like one of the bowls is in the corner & you’d have to lean over to access it.
Charlene wins the T-shirt! Did you notice how the camera did a double-take?
On the doors:
The cherrywood doors came pre-hung with stainless steel hinges with ball-bearings. John bought 30 of them out of Oakland, and got free shipping to boot.
How much? $200 each.
They’re from China.
Very educational. Thanks, Jim. Was the original buyer (Joelle) all-cash? With all-cash fixer money? Were their multiple offers on the property when she went in at $165?
“Just disgruntled and frustrated that we don’t seem to learn from bubbles and our govt is desperate to create new ones.”
It’s not just our current Govt, this stuff has been there from the start, well before we were ever thought of as a nation.
I personally have no doubt SD prices will rise again. But this time the straw will be even thinner.
They say climbing the top of Everest is like running on a treadmill trying to breathe through a straw.
Two smart moves on their part. Buy at the bottom and sell at the top…..all in a period of 4 months. So now the bottom is 300k …how do they repeat this? The banks are watching….and holding back while ‘investors’ bring back the bubble prices for them. Do they buy at 300k now? Oh Oh. Now what? Short lived party me thinks.
There’s certainly value in a properly flipped house. What would a normal home buyer pay to bring those houses into that condition? My guess it would be significantly more than $40K, more like $60-$70K. How many normal home buyers are really qualified to properly manage a large renovation?
My point is that flipping can be an honest way to make money. During the boom, even a poorly managed flip would make a profit, but my guess is that these people know what they are doing.
Jim, I am just amazed that a FHA loan with 3% down is sufficient when your buyer just made 50% on a purchase in 3 months. The volatility associated with real estate now is unreal so one would assume wrongly that down payments must be bigger to deal with the volatility in prices.
I now I am quixotic but one can dream.
Love the blog.
P.S. The appraisal came in at $290,000 ($16,000 short).
I’m glad Larry & Co are putting up the good fight against the HVCC….the flipper comp was $278,000.
shadash, who said they even put 3% down? $8K more than covers that, done and done!
BAM,
Yes, three important ingredients at work here:
Cash Buyer
Veteran General Contractor
Sharp realtor
But the most critical ingredient is investing the time to see properties in person every day for a month or two.
Lots of people call who have money, and I always ask, do you have the time to invest?
It’s a tall order.
Seems like a good price on the doors. Can you get the name of the supplier? Or was it a one-off deal?
He got it off the internet.
Matt, come on man, that’s my client!
Cool- a T-shirt! Thanks! Yes, noticed the camera double-take, but I still had to make it full-screen and pause to make sure I was seeing it correctly. That stuff makes me nutso.
Love the blog, videos and comments. It’s all so helpful. Thanks.
Jim,
Can you help it if you have cute clients? 🙂
Great piece! I can really see this story “Housing Bubble Redux” making 60 minutes. You should contact them and tell them what’s going on. You will be even more famous 😉 and it will make an interesting story.
$40k to redo all that and landscape !
I would kill to have a contractor like that.
Decent remodel.
I don’t know Vista that well but it personally would take a lot more than that to make me want to move to Vista and spend 300k. I guess if I could use 8k rebate for down payment and have a non recourse loan I’d have no worries.
This one is on Leon in NE Oceanside, not far from the back gate.
Stay tuned though, three of the five are in Vista.
You just made my day.
Home ownership is a function of income. Unemployment is a spyglass into the future of flipping. There will be another downturn in real estate in 2010. Those that are buying now will see their investments depreciate. The bubble is over.
The numbers don’t quite add up. Do you think they really did all that for $40k in 10 weeks?
Thanks, Jim. This is so helpful.
I have everything but the cash! Let me know if you want to float me.
BTW, I always considered flippers the people (particularly in San Diego) who buy new construction with no upgrades in Phase I of a buildout, never live in it, then sell it 6-12 mos. later to someone when Phase IV comes out and turns a profit on paper just like that. I think Joelle remodeled a crappy looking house, which bettered the neighborhood as a whole, and presumably brought some quality owners in there who will care for the property as well. Plus, most people don’t have the heart or guts to remodel and will pay a premium for someone else to deal with it. I think what she did should not even be called flipping, given the negative context of that word these days. It deserves more respect than that.
BAM-No, what she is doing is certainly flipping. Buying a house and then reselling it within a short period, while never living in it or renting it out, is automatically a flip. Some flips involve a remodel, some don’t. But the whole point to a flip is having the purchase price plus all costs (including the costs of the remodel) be greater than the later sale price.
It looks nice – but is it my imagination, or is the kitchen sink “off?” It looks like one of the bowls is in the corner & you’d have to lean over to access it.
Charlene | August 24th, 2009 at 7:09 pm
That kitchen sink is certainly in an odd place-I don’t like it. I wondered why it wasn’t under the window.
Despite the placement of the sink, they did a fantastic job on the place. These are truly “good” flippers in that they’ve built up actual value in the place through all their hard work.
And I agree 100% with the contractor’s viewpoint on bathroom décor. Keep it simple, and don’t overdo it. I still don’t know what you’re suppose to do with a bidet…
Is the buyer ending up with cash in their pocket at closing…
8k from the feds
6k back, per the end of the video.
That’s $14k. They need 3% down, which is $9.18k.
What am I missing? I’m not at all an expert on FHA loans. I went old school and put more than 20% down on my home. (Pre bubble.)
As you can see,the people with money are buying up the deals in SD. I’m afraid the bottom has been reached and those with the cash and good credit are making $$ off of us dummies who are sitting on the sidelines.
UCGal,
The $6,000 will just cover the closing costs (loan, title, and escrow fees) plus the “prepaids”, the amount used to set up the monthly tax and insurance impound account.
But agreed, their skin is thin!
From Bryce regarding costs:
Kitchen cabinets are from China; installed and finished with granite tops $4,500 each. But they did 5 homes and John’s a great negotiator. The bathroom cabinets are Ikea.
I suggested the doors and the tan walls to make the home feel more custom.
“P.S. The appraisal came in at $290,000 ($16,000 short).” (JtR)
The list price was $278K, and the appraisal was $16K short, with the winning buyer offering $300K with $6K back, right? Silly question but who made up the difference?
And FWIW, besides the $278K list price, I think if you asked all eight buyers (5 VA and 3 FHA and within two days of listing) why they made an offer, it would be the cherry doors (and they didn’t even care that the doors didn’t match the cabinets or realize that the kitchen sink placement was kooky).
Awesome sauce!
Hope they buy the bank owned one on the end of my street and flip it just like this one. I’m sure its cheap cause it is near oside blvd.
The nearby elementary school just got an official arts designation.
Great work on the rehab. It came out great.
If possible please post the name of the door company.
BAM – I totally agree, they earned it by shopping hard, not overpaying, and doing smart upgrades. Much different than winning the lotto to buy in Phase One.
But they don’t mind admitting that they are accidental flippers – everyone’s a flipper when a little luck comes their way too.
On the lower end it all comes down to price. $300,000 homes will be in high demand for a long time. Most people living in this area are paying $1200-$1700 for a 2-3 bedroom apartment.
A $1700 payment to own a home in San Diego including PMI for barely nothing is a no brainer.
The flippers got an amazing deal and the house payment is affordable.
I disagree with others here that this is a new bubble. . .160K seemed like a very good price to buy, and 300K for a nice house in Oceanside seems like a fair price to sell. I believe the “military housing allowance” is about $1600-1800 a month for rent, so even at $600 per hundred thousand on a loan, that would be $1800 a month mortgage payment (likely much less), so that is in the range of affordability for a lot of people, especially in the military.
As we all agree on this board – the big problem is not in the 200-400K range – a lot of demand there – it is in the over 700K where the market is still tanking.
Jim,
There is an REO on Valley RD here in Vista below my house that these folks may want to take a look at. Its attracting a lot of lookers.
Windows, appliances, fixtures, flooring, landscape, labor, etc. It didn’t all come from China. I am surprised 40k would cover it.
Doesn’t the 6K back to the buyer inflate the value for comps? I know it isn’t much, but it is an artificial price, no?
I don’t know what everyone is so worried about.
When you only put someone else’s 3% down, and have a weeks worth of savings in the bank what could possibly go wrong in this market?
Who cares if unemployment is going up? It’s not going up as fast!
Bunch of worry warts, seriously.
‘40% have less than a month of savings, while only 20% have 6 months or more. The remaining 40% are in between.’
http://globaleconomicanalysis.blogspot.com/2009/08/34-percent-of-workers-have-one-week-or.html
BTW, in all seriousness thanks for the video update Jim – interesting to see the results!
8k from the feds
6k back, per the end of the video.
That’s $14k. They need 3% down, which is $9.18k.
…
The $6,000 will just cover the closing costs (loan, title, and escrow fees) plus the “prepaids”, the amount used to set up the monthly tax and insurance impound account.
Sounds like the ‘new’ buyer is yet another flipper.. 100%+ effective financing(and not a good/skilled flipper at that). Wrong time in the season to buy for flipping, you generally want cosmetically bad, structurally good properties to do a flip, and ready to sell at the start of spring-summer.
The ‘fixup’ is nice, but I would tend to discount several things if I were buying. The kitchen sink is definitely an issue.. and visually weird (probably was a galley kitchen originally). It is also not cheap to fix. To fix it now would mean tearing out some of the new cabinets, relocating plumbing (probably in-floor plumbing because you can only hollow out a certain number of consecutive studs for 2 to 3 inch drain line from the sink). Doing the in-floor work means tearing up the tile and the concrete slab. If the slab is ‘pre-stressed’, forget about cutting into it to relocate the drain.
The bathroom sinks have me in a quandary. I like the big sinks with high faucets.. but I also like bathroom counter space..
I would have gone for larger windows in the bedroom.
At 300k, I think the price is high, but from the sellers aspect, it is a very good deal.