With no real surge in inventory (yet), we are entering the hyper-frenzy phase now.
It’s an environment where most listing agents are ill-equipped to handle the pressure because they’ve never done this before. The only time we’ve been close to having insanity like this was at the bottom in 2009 when the bank-owned properties were getting 10-30 offers on every property.
How many REO listing agents are left, besides me? Yep, I can’t think of any either.
As a result, sellers are leaving money on the table all over the county. Why? Because inexperienced agents get inundated with requests and offers, and instead of handling them professionally, they just shut it down instead. Examples from this week:
They stop answering the phone, or returning calls/texts.
They direct you to automated services.
They mark the listing as pending or withdrawn before accepting an offer.
They accept an offer before showing appointments are completed.
Basically, they blow you off.
While they may think that it is their prerogative, they aren’t upholding their fiduciary duty to their seller by limiting the showings. Furthermore, they have an obligation to their fellow agents to allow them the opportunity to sell the listing. Yes, broker cooperation includes letting every agent have a chance to sell your listing – it’s how the system works. You sell my listings, and I sell yours.
It’s gotten so bad that another agent was joking with me that when he sees a hot new listing come up, he just books the first appointment available, and then looks for a buyer.
If we are going to abandon the traditions, let’s take it a step further to solve all the problems at once.
There have been misguided attempts previously that have probably sent us backwards, so there’s work to do to convince people. But auctions are the answer.
Conducting a live auction where all participants can witness the process (to keep it honest), and let the transparency drive the Fear Of Losing is the most effective way to get buyers to pay top dollar.
Will the jacked-up Covid-19 era finally cause auctions to emerge as the answer?
It doesn’t have to be anything fancy – this one worked great:
Will auctions be implemented by the old guard? It’s doubtful. While the hottest bidding wars are primarily on the lower-end properties (under $2,000,000), we can learn a lot from an auction company who only works the higher-end. They have a designated showing period where buyers are welcome to tour the home with their inspectors, then attend the live auction where a lucky bidder will likely buy a house that day.
Think of their benefits:
Showing dates and times arranged in advance.
Day of sale (Auction date) set in advance
10% commissions (known as ‘premiums’ which sounds friendlier)
Commissions are PAID BY BUYER and tacked onto the winning bid.
Sellers and agents will love that program, and we’ve already seen buyers be ready, willing, and able to pay 10%+ over list price these days – so they end up in the same place anyway.
The industry should convert to this auction format today and solve everything!
It looks like this home would have sunset views year-round plus be able to see up and down the coast too. The video is about the right length to pique your interest if you’re in this price category.
This scenic and recognizable home sits on a 1.1-acre +/- gated parcel in Laguna Beach known as Moss Point and is permeated by a sense of peace and true stillness. Ocean breezes sweep across gardens and stone paths lead to two spectacular view points, as staircases chiseled into the coastal bluff give direct access to sandy coves and a naturally-occurring pool. Crisp white siding and a covered porch create a picturesque scene where it’s easy to imagine President Woodrow Wilson lingering during his visits to this place, once under consideration to become the “Western White House”. The 4,325 +/- sq. ft. residence with 5 beds and 6 baths has been modernized, while preserving the character of its 1917 roots.
Showings are already 20.2% higher than they were during the first week of January, which is double what they were last year. But the NSDCC listings in January are going to be at least 20% fewer, year-over-year.
Last January we had 354 NSDCC listings, and today we have 239, month-to-date. We going to end up about 25% below last year’s count.
More demand and less supply = max frenzy conditions!
We can hope that the magical April-1st-date-when-seniors-can-take-their-tax-basis-with-them, combined with lower Covid-19 counts will unleash a surge of new supply.
Could it be that potential sellers are purposely waiting for prices to go up higher?
Here’s one example:
I sold this 2-on-1 property for $400,000 in 2002.
My client and I had begun chatting about selling early last year. At the time, my quote was in the $900,000s, and by the end of summer I was up to $1,200,000. He said he’d think about it.
He ended up listing with a different agent for $1,395,000 in November.
It’s only one example, but it makes me think that buyers might have some attachment to reality, and that starting with an attractive price in the beginning is the best way of getting it bid up to the moon.
Excerpts here from an article yesterday about the Fed’s involvement. The rapid run-up in home prices is brutal on home buyers, but for home sellers, realtors, and the overall economy, it is great news. Expect that the Fed will be very accommodative for longer than it takes to get employment on track, which means we should have low mortgage rates – and higher home prices – for at least the next year.
But what if the run-up in home prices is temporary?
Does Powell expect home prices to come down when rates go up? I hope not, because sellers get a vote – and we know they will be VERY reluctant to sell for less. Either we will have low rates forever, or once they go up (back to 4-something), the bubble created won’t pop or crash – instead it will ooze like slime while participants grapple with an unprecedented marketplace with little or no help:
Powell explained that the Fed has had to use its extraordinary policy to help the economy with still more than 9 million people out of work.
“It’s very much appropriate that monetary policy be accommodative,” he said. Powell also said with regard to financial stability, the Fed considers asset prices, leverage in the banking system and nonbanking system, as well as funding risk.
“I would say financial stability vulnerabilities are overall moderate,” he said, adding the Fed’s goals are also to prevent long-term damage to the economy and make sure the financial system is resilient to shocks. He said he believes the run-up in housing prices is temporary, and the pandemic has created a surge in demand because of people working from home.
“I think he’s reluctant to talk about specific stocks and even when he was asked about the housing market, he feels as though some of that is specific to the idea that supply was constrained, and there was pent-up demand and it’s temporary,” said Michael Arone, chief market strategist at State Street Global Advisors. “I wouldn’t expect the Fed chairman to acknowledge that Fed policy helps create bubbles.”
The Fed’s zero rate policy has helped fuel a mortgage boom with record low lending rates. Home prices were up 9.5% in November from a year earlier, the strongest annual growth rate in over six years, according to S&P CoreLogic Case-Shiller Home Price Indices. It is one of the strongest annual gains in the 30-year history of the data.
Powell, during the briefing, said the latest run-up in asset prices was not due to monetary policy but due to news on vaccines and fiscal stimulus. “He’s overstating the ability of the Fed to help the economy and understating its ability to help markets,” said Peter Boockvar, chief investment strategist at Bleakley Global Advisors. “He keeps deflecting.” Boockvar said the Fed’s policy impact is clearly felt across markets, including junk bonds where yields are at historic lows and some prices are at record highs.
“They’re solely focused on the virus and they don’t care what the side effects are of what they’re currently doing. Buying $80 billion of short term Treasurys, how does that translate to better economic growth?” he said. “Powell was so nonchalant about these hikes in home prices. It’s just temporary. Tell that to the first time homebuyer who is trying to buy a home and keeps getting outbid.”
Rupkey said the Fed is more concerned about other problems and does not see an issue yet.
“This Federal Reserve is not going to respond to asset prices unless they go up another 100%. This Fed is more concerned than ever about maximum employment,” Rupkey said, “helping those on the very fringe of the labor market.”
Located on a culdesac in a gated community in Robertson Ranch, this home lives like a single story w/ master suite & additional bedroom suite on the 1st floor. The great room is surrounded by glass with abundant natural light and the cantina doors open wide to the outdoors. Stunning kitchen w/ high end appliances, large wine fridge, custom island, and designer lighting & paint. Two bedrooms plus huge bonus room upstairs which is perfect for all home activities! A real showplace – wow!
Facing an upsurge in housing demand across the country, many home buyers are finding themselves in bidding wars for the limited inventory on the market. To win, buyers are trying to find ways to entice sellers beyond price—and at times are taking it too far, real estate professionals say.
Mary Lou Wertz of Maison Real Estate in Charleston, S.C., talked to The Wall Street Journal about one couple relocating from New York who fell in love with a $1.2 million, four-bedroom home online. The seller had already accepted another offer, however. The New York couple offered to pay $10,000 more than the other buyers as well as offer their competitors $25,000 to walk away from the home. They also told the seller that they would make a $30,000 donation toward a hospital for cancer research since the seller had recently lost his wife to cancer.
Ultimately, the New York couple’s offer was not accepted. The offer seemed “a little over the top” to the seller, Wertz told the Journal.
Another couple shared with the Journal how they toured 50 Los Angeles homes, submitted 16 offers—sometimes above the asking price—and were outbid every single time. But they weren’t about to lose out on a three-bedroom home listed for $735,000 in the Northridge area. “We were turning up at showings, and there would be a line of people who were there before us,” Andrea Kissling of Los Angeles told the Journal. “These houses were getting 30 or 40 offers and going $100,000 over asking.”
The buyers noticed memorabilia around the house of the Harry Potter films. So they produced a Harry Potter-themed video for the sellers (one of the buyers provides design services for Warner Bros.). The video fawned over the home and showed the couple reading Harry Potter books to their children. The couple also offered to buy the sellers VIP passes to The Wizarding World of Harry Potter at Universal Studios Hollywood.
Despite all the work, the couple still lost out to a higher offer for the home.
Chris Furstenberg of Nourmand & Associates in Los Angeles told the Journal that one of his clients—a filmmaker—once made an offer that came with the promise of tickets to the Academy Awards. Still, the seller went for a higher offer.
Furstenberg says such enticements often only work to settle a tie in a bidding war. But if there’s a higher price, that usually always wins out in the end—no matter how much buyers try to sweeten the deal with other offerings.
Top Jimmy & The Rhythm Pigs had a residency playing “Blue Mondays” every Monday night at the Cathay de Grande nightclub at the corner of Argyle and Selma in Hollywood, California for three years, and was an important part of the Los Angeles rock scene. Top Jimmy & The Rhythm Pigs concerts often featured guest appearances by such artists as Tom Waits, David Lee Roth, Stevie Ray Vaughan, members of X, The Blasters, The Gun Club, The Circle Jerks, The Plugz, The Fabulous Thunderbirds, and many more.
D.J. Bonebrake, who appeared on Pigus Drunkus Maximus, was a member of X. The band was saluted in the Van Halen song “Top Jimmy”, and mentioned in “The Call of the Wreckin’ Ball,” on the The Knitters album, Poor Little Critter on the Road and the X album, Live at the Whisky a Go-Go.
Live, Top Jimmy & The Rhythm Pigs usually consisted of Top Jimmy (James Paul Koncek): vocals, Carlos Guitarlos: guitar and vocals, Gil T.: bass and vocals, Dig The Pig: guitar, Joey Morales: drums and either Tom Fabre or Steve Berlin on saxophone. On their only record, Pigus Drunkus Maximus, released in 1987 (Down There Records, distributed by Restless), D.J. Bonebrake and Tony Morales contributed drum parts, while Gene Taylor added piano.
Top Jimmy got his nickname because he at one point worked at a fast-food stand called “Top Taco”, located across the street from the A&M Records studios in Hollywood. At some point, he got a job working as a roadie for X. At the end of a soundcheck, he sang a version of the Doors “Roadhouse Blues”, which garnered the attention of the band and Doors member Ray Manzarek, and led to Top Jimmy performing an encore version of the song with X and Manzarek, during a May 1980 X show at the Whisky-A-Go-Go.
Koncek died in 2001 in Las Vegas, Nevada from liver failure.
The values of nearby condos should benefit greatly from the housing shortage around UCSD: http://enewspaper.sandiegouniontribune.com/infinity/article_share.aspx?guid=5997c243-aa01-4fdd-96f6-d71d8fd7f25a - As numbers boom, UCSD embraces its more social side
Jim the Realtor is legit - I interviewed three brokers; he said list price should be $100,000 higher than the other two brokers; listed it with him and had all cash (no financing) offer in two days, five day contingency period, closing in two weeks - and it closed at his recommended list price. I could not recommend anyone more than I recommend Jim the Realtor.
When we moved to San Diego in 2005 we rented a big house on Mt. Soledad (La Jolla) with 180 degree ocean views for the same payment as a mortgage on a dump in Chula Vista. Clearly something was wrong. Yet, the media was full of the usual happy-talk nonsense, so I was glad to find Jim's blog. I've followed his honest assessments and data since.
We decided to sell and move to AZ at Thanksgiving. Dec. 1st we met with Jim to sell our home. We closed today (29 days later). Jim orchestrated a feeding frenzy -- we had 25 showings in 2-1/2 days, multiple offers, and sold for well over asking price. I'd say he earned his commission! We have owned and sold homes in 5 different States always using experienced, productive, full-time realtors. Jim outshines them all.
You don't decide to sell and close 29 days later over Christmas (with COVID lockdown) without some miracles. Donna was amazing at performing lots of those miracles and ensuring that everything was done right and on time. They are a terrific team with a very responsive and professional network.
Where do we begin..2020 has been a year for everyone. When COVID hit and shut down both my husband and my businesses, we were left with a mortgage and very little income coming in. We were stressed, scared and felt stuck. We made the hard decision to sell our home and move out of state. We contacted the Klinges' and spent a good hour going over what we hoped we could accomplish. Jim and Donna came over with comps in hand and suggestions on improvements to get our house ready for the market. It was overwhelming to think about, but Donna was there and one step ahead in every scenario. Basically we just approved what they suggested and Donna handled literally everything. We placed our house on the market and within the first day we had multiple offers well above asking price! We couldn't believe it. We were overjoyed! Jim countered the offers to weed through them, and everyone came back with way more. It was amazing, and we are ?? sure it was because of the staging and repairs the Klinges suggested we do.
Due to unforeseen dishonesty from the buyers lender, we hit a big hurdle when trying to close. We had already moved out of state and were shocked when three days before closing the lender dropped a bombshell on the buyers and us. However, Jim and Donna handled it like veterans, not afraid to play hard ball and represent their clients. After a few phone calls with us, and several between Donna and the lender, they had a plan B-Z to make sure we were taken care of. In the end we closed with even more money than we ever thought possible and with very little work from us. The Klinges handled this entire "2020" worthy event with the utmost professionalism and did everything in their power to not only make this as smooth as possible for us, but we also walked away with more money from the sale of the house than we ever hoped for. After working with Jim and Donna, you don't ever use anyone else. They are hands down the best team to represent you in any scenario.
Working with Klinge Realty Group was a great experience! They are very responsive, professional and knowledgable about the real estate market! I would definitely recommend Klinge Realty Group.
Jim and Donna Klinge made the sale of our condo extraordinarily easy. They know the market and gave us sound advice backed by details and very considerable experience, reflected both in the initial pricing and subsequent negotiations. They work together as a team and are always available to talk. We had a few challenges with our property and they were able to coordinate the resolution to everything, including items that I would not think would ordinarily be their responsibility to handle. They made the whole process effortless on our part. They are folks with high integrity and we cannot recommend them highly enough.
Review for Member: Donna Klinge
I cannot believe there are no reviews of Donna yet, ugh!! She is the secret sauce of the Jim Klinge/Donna Klinge combo! I will touch on Jim here, but Donna is why I'm so totally loyal to these two (no offense to Jim :)).
I consider myself a rather savvy buyer/seller. I've bought/sold 7 times in about 15 years. On the buy side, Jim is the PERFECT combo of: completely digitally savvy (he will pull data all day long until you feel comfortable with your chosen house, area, school district, anticipated appreciation rate...anything!), he's super well respected and known in the area by other agents, an amazingly cool but strategic negotiator, is totally devoid of desperation for a sale/commission, and more.
Then once you get into contract phase, Donna literally handles every last and final detail in a concierge-like manner -- totally shielding you from the daily back and forth, noodling and annoyances of the buyer's requests. She solves it ALL; it's miraculous what that woman accomplishes over and above what is even expected in a buy/sell transaction.
On the sell side, Jim and Donna do the same, but even moreso. Donna in particular truly takes everything off your plate: she'll manage getting the house painted, the carpets replaced, she'll go on site (as she Jim both did for me when selling our rental properties) to work with the renters and make sure the house is ready to show -- freeing me to have to take time off of work to do so. They work with A+ integrity, too, so you know you are serving all parties fairly and lawfully throughout.
A home purchase/sale is the most considered you'll ever make. HIRE A SAVVY AGENT, not a friend!, and get what you need out of the transaction. Jim and Donna are our agents for life.
Jim and Donna Klinge are by far the most professional, personable and responsive realtors I have ever worked with. They provide VIP concierge level service in every area of the process of selling your home. My home was marketed so successfully that we received an offer the day after our first and only open house. Thanks to Jim's pricing and negotiating, our house is now the highest sold in our community. Jim's vast experience means he has worked with several realtors and knows the market all over north county. Donna is AMAZING in processing everything in the transaction. She scheduled trades people to work on the house in preparation for the sale as well as the repairs needed before closing. She communicated clearly every step of the way about what would be happening. She took the weight off my shoulders for the whole process. I will always use Jim and Donna for my future real estate needs and I whole heartedly recommend them to anyone buying or selling a home.
Jim and the team at Klinge Reality are without a doubt the best in the business! Not only was Jim helpful and extremely knowledgeable, he was patient and determined to help me find my first home. Jim and his team have been in the business for many years, and it shows. Jim is a wealth of knowledge and was my biggest proponent despite the temperature of the competitive market. I ended up getting the perfect property in my dream neighborhood all thanks to Jim. From the day my offer was accepted, Donna was a real lifesaver. She was extremely helpful, responsive, and knowledgeable when it came to every minute detail, and held my hand through the process. As a first time home buyer I had no idea what the process would entail, but Donna curtailed every concern I came across and made the escrow process feel seamless. Jim and Donna provided me the best home buying experience, and I am very grateful for all they did for me. It was truly a pleasure to work with Jim and Donna and I am already looking forward to the next time we work together!
Review for Member: Richard Morgan
Richard is an amazing realtor! He has high integrity and genuinely cares about his clients and their needs. Richard paid close attention to what I was seeking in a home and was very patient in our search to find it. I would highly recommend Richard and will use him for future transactions. Truly a different kind of realtor experience!
Could not be happier with my experience with Jim and his team. He helped me sell a very unique and challenging property. Throughout the entire process he was always available, honest, transparent, trustworthy, and always put my interests as a seller first. A (rare) true professional! During close of escrow Jim went above and beyond to complete the deal. It would not have been possible without his experience, fantastic team, and pure dedication. Highly recommended!
Thanks Jim and Donna Klinge!