It always seemed to me that if ADUs were selling for $50,000 or less, there would be lots of interest. Literally the first one I ran into (below) at the Tiny Fest was priced at $50,000, and people were standing in line to experience this 8.5 ft x 30 ft home with kitchen and full bath (seen in right window).
I have to hand it to Brett and team in their preparation of this 1975-built home in Solana Beach. The flooring was removed downstairs, and they added a heavy epoxy paint to the exposed-concrete, which gave it a trendy-hip look to go with the colorful formica in the kitchen:
The list price is $1,850,000, and they already have four offers!
Let’s review what it takes to create a solid bidding war.
Maintain and improve your home constantly over the years.
Install a master bathroom like this!
3. List with Jim the Realtor for an attractive price, do $3,200 of staging, and take off for the weekend!
I inputted the listing at 8:30am on Saturday morning with professional photos, and got immediate results – over 100 people came to open house the same day.
Sunday’s open house had nearly as many people, and those who didn’t attend could watch my walk-around tour on video: https://youtu.be/LCEDYc4rkaQ
We’ve received EIGHT WRITTEN OFFERS (seven over list price), and going for more. Three showings set up for today, and Donna and I are fielding questions and encouraging higher bids all day long!
To ensure top dollar, we treat everyone fairly and give them every opportunity to bid up the price. The highest offer so far is $890,000, and others have said they are going higher so we raised the list price from $869,000 to $899,000 on the MLS for added exposure on the realtor hotsheet. I mentioned that we have eight offers too.
Want this kind of attention when selling your home? Hire Jim the Realtor!
The surge noted last week continued its hot streak, which should be expected as the selling season really gets rolling. The total number of pendings increased 6%, and those over $2,000,000 increased 24%!
Glad to see the $2,000,000+ market having some life, with 462 active listings – or 54% of the total inventory of houses for sale between La Jolla and Carlsbad.
Even though it might feel warmer, we are still lagging behind last year:
Weekly Total Pendings
What might contribute to buyers wanting to wait-and-see a bit longer is the lack of bidding wars. Instead of having to deal with the messy multiple-offer situations, agents who get a hot listing just sell it off-market now.
Without bidding wars, we don’t have those disappointed losers who get more determined to grab the next one, and move quickly to pay whatever it takes.
Home sellers who have been on the market for 30 or more days and are tired of not selling may eventually consider a price reduction – but by how much?
There are a number of reasons why a home isn’t selling. Thankfully, you don’t have to be an expert on why – because price will fix anything:
Funky floor plan
Few or no comps
Buyers are willing to pay within 5% of the list price. So if you are getting showings and offers, then the list price is about right.
If you’re not getting offers, then the list price must be more than 5% wrong.
Won’t buyers make an offer, even a low one? No – it’s too easy for buyers to stay on the fence while they wait-and-see, rather than make a low offer. In fact, we rarely see an offer that is lower than 5% below the list price because buyers would rather not bother – plus they don’t want to offend anyone.
A proper price reduction re-ignites the urgency and enthusiasm in buyers, which makes them want to write a good offer.
How much is needed to get buyers to engage?
Lower the price by 5%.
You see sellers lowering their price by 1% or less, but that’s not impressing the buyers – if anything, it reminds them that your price is still wrong because it still looks too much like the old price.
Lowering the price by 5% not only re-engages the existing buyers who are considering your home, but it also picks up a new set of buyers who weren’t looking as high as your previous price.
It may sound bold, but what else can a seller do to regain momentum?
Two things: a) Complete repairs/improvements to bring the home’s value up, or b) cancel the listing and try again a few month later.
If you don’t want to bother with repairs and really want to sell now, then do this exercise:
How does your home compare to the active listings priced at 5% below their current price – are you winning that test? Is your house the best of that bunch? Find the group of active listings where your house is the obvious winner, and you’ll know the price that will work.
If 5% sounds like too much, and waiting longer for that perfect couple with 2.2 kids to come along is easier to swallow, then no problem. It could happen.
But if you’re tired of waiting and will consider a price reduction, then 5% is the recommended amount – which isn’t giving it away. It’s just recognizing that the initial list price was too optimistic, and a more-realistic price is needed.
Smaller reductions won’t cause buyers into doing anything different than they’ve been doing – waiting for a fair price/value for today’s market.
Rob Dawg left this comment regarding the seniors who are aging-in-place:
Wait until autonomous vehicles add another ten years.
Self-driving cars have the potential to change everything about real estate:
Seniors be able to stay in their home longer.
Homebuyers could live farther away and get more home for their money.
Kids wouldn’t need parents driving them around.
But one of the big hurdles is whether people will trust computers to drive the cars for them. You may know that Mercedes-Benz has installed automatic braking systems, and I have one on my car – and hate it.
When I drive up slowly at an intersection, the computer is overly-sensitive, and brakes too early – and it’s not gentle. With no warning, the computer slams the brakes on, giving riders a whiplash, and in one case, causing the driver behind to hit me! The system has a manual turn-off button, but it’s hard to find and not permanent so it’s a constant battle. Donna agreed that I’ve altered my driving considerably, but I’m giving up. I’m going to get a normal car instead.
More hurdles that will cause autonomous vehicles to be delayed:
Have you seen homes going pending that weren’t selling a few months ago?
You could make a case that the market is somewhat seasonal, and just the increase in the number of buyers would improve the market. But junk is junk, whether you’ve been looking for days or months.
We already discussed how sellers of newly-listed homes are bursting with optimism now that the selling season is underway. But those sellers who have been lingering for weeks or months have already tested the market, and should be more realistic.
My theory is that some buyers are cutting deals on the older listings.
Multiple offers are back. Three examples from the last 24 hours:
One-story house that had been on the market for 30 days (plus Coming Soon)
Two-story house that just listed for $1M in SEH, plus
A contingent buyer around $2 million getting beat out twice to non-contingent buyers.
It is remarkable that in 2019, realtors still don’t have rules, laws, procedures, or any effective guidance on how to handle a bidding war so the sellers get the best deal while giving every buyer a fair chance to compete.
But we do have a summary form! We could do this on a napkin:
"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... more "
by Ann Romanello
"Jim educated us, helped us find the perfect house, and then negotiated us a great deal. I would hate to be sitting across the negotiating table from ... more "
"Jim is thorough and will be brutally honest about the homes he shows you. He provides great service and follows through until the very end and even ... more "
"I highly recommend Jim as a buyer’s agent. Working with Jim, we closed this week on a San Diego condo. Jim prepared a list of comparable sales to ... more "