What’s Hot

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!

Link to Listing

13604 Boquita Drive, Del Mar

Our new listing in Del Mar, and great for multi-gen! A rare find of a 5br/4ba, 3,708sf home with two master suites – one on each floor! Fully remodeled with dual-pane windows, dual-zone HVAC, tankless W/H, new paint, hardwood floors, Craftsman kitchen, owned solar system with 240 outlet for your car charger, and full blown panoramic ocean view overlooking the Torrey Pines Reserve – wow!

LP = $2,495,000

Sunset Open House this Friday 4-6pm, and open 12-3pm this Saturday & Sunday, February 8th and 9th.

Link to Listing

Getting Rid of Stuff

From the WSJ – thanks Sergio:

As a top Hollywood talent agent for over 40 years, Deborah Miller Lakoff represented big names like William Devane, Ned Beatty, Bob Uecker and Julio Iglesias. For proof, one could just look in her garage.

“There was a massive collection of stuff” stored there, says Fred Meyer, who is Ms. Miller Lakoff’s nephew. In addition to autographed memorabilia and keepsakes, there was furniture, books, records, clothes, family heirlooms, photos and formal dinnerware.

Last year, Ms. Miller Lakoff decided to move from her 2,300-square-foot home in Marina del Rey, Calif., to the 4,000-square-foot house in San Diego where her husband, Sanford Lakoff, lives. (Theirs had been a long-distance marriage for 10 years.) In the next few months, the couple plans to downsize again and move into a roughly 2,000-square-foot apartment in a retirement community. But before any of that could happen Ms. Miller Lakoff had to get rid of a lifetime of accumulated things and sell the house where she had lived for 35 years.

The first hurdle was to decide what items would make the trip to San Diego. Ms. Miller Lakoff and Mr. Meyer, her nephew, worked on that task together. “You need someone who can persuade you to get rid of a lot of stuff. Fred was that person,” Ms. Miller Lakoff says. She resold some of her clothes, record albums and books to second-hand shops, and donated much of her furniture to two young families that had just bought a home. Mr. Meyer digitized photographs and distributed many of his aunt’s heirlooms and keepsakes among family members. “Everybody was thrilled to see this stuff,” he says.

The second—and bigger—challenge was deciding what to do with everything else. For this, she called in reinforcements, hiring Greg Gunderson, president and owner of Gentle Transitions, a Manhattan Beach, Calif., company that specializes in helping people downsize and move.

Mr. Gunderson called in a number of dealers and collectors who purchased some of the high-value items, with all of the proceeds going to Ms. Miller Lakoff. Finally, Mr. Gunderson’s team also packed up everything and did a final “clean out” of the house so it would be ready for the next owner. The whole process took between 2½ and three months and cost $2,300, says Mr. Gunderson. He charges $75 an hour, adding that a typical move to a one- or two-bedroom apartment in a retirement community ranges from $3,000 to $6,000.

The daunting task of downsizing has led to an array of companies and services that promise to make the process easier. Much of the focus is on getting rid of things and coordinating the move. But the real service is persuading people to “let go” of items they’ve held on to for decades.

“There are ways to honor the memory of something without having the physical piece in front of you,” says Mary Kay Buysse, executive director of the National Association of Senior Move Managers, a trade organization with about 1,000 member companies.

When helping their 89-year-old mother downsize in Greenwich, Conn., David Borie and his sister, Mary Zara, turned to a Darien company called The Settler. Their mother, a retired artist and interior designer, had chosen the move-management company to help her deal with the contents of her 6,000-square-foot house and coordinate her relocation into a 2,000-square-foot apartment in a Stamford, Conn., retirement community. The company put color-coded stickers on items to designate their status—if they were going to be moved to the new apartment, given to a family member, sold, donated or thrown away.

Before any artwork was removed, Mr. Borie made giclée reproductions (high-quality prints made with an ink jet printer) of some of the pieces their mother had painted, along with a lesser-known portrait of George Washington by Gilbert Stuart. (Washington is a Borie family ancestor, a seventh great uncle.) He and his other three siblings each received the reproductions and also had the option to get a giclée print of a painting by another ancestor, Adolphe Borie.

The four siblings supported The Settler’s objectives, but to minimize any quibbles, the company listed all of their mother’s possessions on a spreadsheet and let the children rank them from 1 to 75. The Settler’s staffers used a draft system to ensure that items were distributed fairly.

“Nobody got everything they wanted, but we each got some things. And nobody felt someone else got the advantage,” Mr. Borie says. He declined to divulge what the The Settler was paid, but owner Pinny Randall says her company’s services typically range from $10,000 to $15,000.

There were some emotional moments throughout the process. Mr. Borie and his sister worked hard to ensure that their mother was comfortable with downsizing.

His recommendation: Start the process early, when things are less likely to get muddled. And children should be sensitive to psychological struggles when a parent is asked to let go of a lifetime of memories and leave a home they may have occupied for up to 50 years.

Still, once the job is done, many downsizers say they feel a sense of liberation and relief. “Cleaning your shelves and getting rid of things is just a wonderful thing to do,” says Sheri Koones, author of the recently published “Downsize: Living Large in a Small House.” Three years ago, Ms. Koones downsized from a 6,800-square-foot home in Greenwich, Conn., to a 1,700-square-foot home there and got rid of 90% of what she owned.

Link to WSJ article

Median SP:LP

The SP:LP ratio has been very consistent for those selling a home under $2,000,000 – you can expect to get pretty close to your asking price.  Above $2,000,000 is a different story.

Mortgage rates had averaged 3.99% in 2017. You can see how the lower-end buyers became less concerned about getting a discount as rates started rising in early 2018 (they reached 4.59% in May, 2018):

This is another place that listing agents manipulate the data. When marking their listings as sold, many will lower the list price to match the sales price in order to make it look like they sell their listings for ask.

New Agent Reality Show

Hat tip to SM for sending this in!

The “hideous” couches have to go.

And that isn’t the only request Beverly Hills-based realtor Aaron Kirman makes to the owner of an oceanfront Dana Point house on CNBC’s new “Listing Impossible,” which premieres at 7 p.m. Wednesday, Jan. 15.

The eight-episode real estate series produced by Authentic Entertainment, a division of Endemol Shine North America, follows the powerhouse agent and his team as they take on big-ticket homes in Orange and Los Angeles counties that have languished on the market for too long.

“I am up against people that are winning and losing every day, and I felt like the world doesn’t see real estate in an accurate way on TV,” said Kirman, president of Compass’ luxury estates division who in 2019, alone, sold $500 million in real estate. “I wanted to show sellers mistakes not to do, so they could win, whether they live in a multi-million-dollar house or a $60,000 trailer.”

The series, filmed from late 2018 into spring 2019, features the jaw-dropping homes of attorneys, business executives and celebrities who aren’t used to being told what to do.

Kirman knows how to break a hard-to-sell logjam with high-priced staging, landscaping and lowering the asking price. But that hard truth is greeted with stunned looks on the faces of his potential clients.

And, naturally, there’s pushback.

“Aaron, they’re not that bad,” Renetta Caya, owner of the Dana Point property that was listed at $13.9 million for three years without one offer. That was before Kirman and his team entered the picture and told her they didn’t like her couches.

“They’re pretty bad,” Kirman insisted.

The house sold in October 2018 for $8.807 million, property records show.

Link to Article

The Invisible Market

Let’s touch on this topic one more time as a new season opens up.

While our 2020 market should be promising, the actual results won’t be as obvious.

Reasons to be optimistic about this year:

  1. Rates are really low, though we expect that now and it won’t set off a frenzy.
  2. Prices have been moderating, which gives the buyers some confidence.
  3. We are overdue for more boomer inventory.

But don’t expect to see a bunch of hot buys hitting the MLS.

Now that the N.A.R. has laid down specific rules for off-market sales, agents are going to take advantage.

While every brokerage will have an internal network to promote new listings within the company prior to MLS-input (which is allowed), the individual realtor teams will run their latest hot listings through their stable of buyers first, before giving the rest of their company a crack at it. Only when those attempts have been exhausted will a listing find its way to the MLS.

It may only be 5% to 10% of the market, but it will be the very best 5% to 10% – those listings that every buyer wants.  Without seeing those hot buys flying off the MLS within days, there will be less urgency and a false malaise setting in with those who are judging the market just based on the MLS activity.

The public won’t have a clue, either.  They will be forming their own opinions about the market based on what they see on Zillow, never knowing there is a secret pre-marketing – and selling – of the best listings.  It will only be those who attend open houses who will get pitched to leave their contact info to receive their off-market buys (it will be the most-heard pitch of the year at open houses).

Don’t sellers object?  Not really, not when it is presented as a better alternative to having strangers traipsing through their house at all hours with little or no notice.  It also becomes the happy option in between selling to Zillow for less and taking a chance on the open market.

Are the off-market sales valid comps?  Everyone is going to assume they are, so let’s include them and figure they may have fetched a little more on the open market.

The rest of what happens in 2020 should look similar to what we had in 2019 – with the amount of inventory dictating the outcome.  Even though buyers may be more active early on, as Diana claimed today for a second time, the higher-end areas should find the buyers being more deliberate, especially if they can’t get their hands on those prime listings.

Seller Instruction to Exclude

The new C.A.R. forms for 2020 are available, and the most interesting is the MLS-exclusion form in light of the NAR Clear Cooperation policy that begins on May 1st.

Last year I asked the C.A.R. lead attorney about their stand on Coming-Soon and off-market listings, and Gov said it is up to the brokerages.  Their new form reflects it too – they have left it optional for agents sellers to choose to comply:


The form does a better job disclosing the listing-agent shenanigans, and makes them a choice for the seller.  But will the listing agent discuss the choices?  Or just write it up and send for sigs?  The sellers just want their money – they assume their agent will be implementing the best ideas to achieve top dollar.

On May 1st, the Clear Cooperation policy will be in effect, which was intended to discourage off-market sales.  But in paragraph 9A you will see that office exclusives are permitted, which will legitimize selling properties in-house.  The realtor shops with the most listings will prosper if they pitch them hard to their fellow agents – and most already have an internal marketing system to facilitate.

There is an argument that off-MLS sales are good for the seller because the buyers are pressured to pay all the money before the property goes on the open market.

But off-MLS sales add some uncertainties:

  1. Did the buyers steal it, or did they over-pay?
  2. Were there other buyers that would have paid more?
  3. Are the off-MLS sales legitimate comps for the next guy (seller or buyer)?
  4. Are we still committed to sharing our listings with other agents?

The MLS will still exist, and be the market of last resort because the best properties with the best prices will be sold in-house, or to the aggressive, professional salespeople.

Richard just procured a new sale for his investor client by calling agents who had sold similar properties recently. One told him that he did have a Coming-Soon that was a 6-cap, and gave him the address. Richard hustled his buyer over to the property and promptly submitted an offer, which got accepted yesterday!

Why are Coming-Soon/off-market sales attractive to listing agents?  Because they can save time and money on marketing, and hurry up to the next deal.  But that selfishness will change the landscape for buyers and buyer-agents, and both will need to be well-connected to succeed.

KRG Insta

Someone noticed yesterday.

Denise B. said to Donna, “What’s happened to your Instagram?”

We have hired a company to produce Instagram content.  Kayla used to be in charge, but after she moved to NYC it was left up to me to find a way to create the Instagram posts, and it just never became a big priority.

But it is now.

I was on the calls and knew that this company would be using my content generously for their posts on our Instagram. I’m paying them……to use my content…..to create my posts.

They add all the hashtags and make them look spiffy, so the likes and followers started improving as soon as they took over this month.

But seeing another company producing my content just fired me up – and now I’m inputting as many Instagram posts as they are!

If Instagram is your thing, check us out – I promise you’ll get your money’s worth:

https://www.instagram.com/klingerealtygroup/

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