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Zillow Buying Houses For Zestimate Value

There are a few Zillow issues to unpack here, so let’s start with them saying they are willing to buy your house for the amount of the zestimate – which is fine, if you don’t care about cashing in on the actual value.

In their press release, the boss claims that the zestimate’s nationwide median error rate for on-market homes of 1.9% which sounds simple enough – for years they have been adjusting their zestimate to the list price once a home goes on the market.

But once my new listing went on the market, they didn’t adjust the zestimate upward.

Would you sell your house for $1,336,035, when Jim the Realtor says it worth $1,599,000?

Factor in that Zillow charges more than I do, and it would mean that hiring me to sell your house would net you about $300,000 more – and that’s if we sell for the list price (it might go higher).

The big difference?

I don’t spend $100 million per year in advertising – they will reach people that I don’t reach.

Tell people to use me instead!

Link to my listing on Zillow

Sprucing Up to Sell

Homeowners fixing up their homes to list this spring will have to decide where to put their time and money to get the most bang for their buck. Zillow has been there, and the practical tips and tricks their experts have learned after selling 10,000 homes could help you sell yours.

Zillow-owned homes, acquired through Zillow Offers in 25 markets nationwide, are carefully evaluated, repaired and cleaned before they hit the market. Zillow invests in the projects that make a home safe, clean and functional, and each time learns more about what appeals to buyers. By sharing these tips, Zillow hopes to help all sellers prioritize their home prep projects.

Pick the Perfect Paint Color

Painting is one project nearly all sellers take on before putting their home on the market. It is an affordable home improvement project that has a high return on investment. But when you’re thinking about resale, you’ll want to be strategic about the colors you select.

When Zillow needs to freshen up the walls before listing a home for sale, it uses Behr Premium Plus paint in either Aged BeigeCampfire Ash or Polar Bear. Neutral greige or taupe paint colors appeal to the widest group of buyers and don’t distract from a home’s best features.

Fix your Faucets and Fixtures

The two most common items Zillow repairs or replaces before listing a home for sale are faucets and light fixtures. A buyer may jump to the conclusion that a leaky faucet is a sign there may be water damage, while a broken fixture could inaccurately signal potential electrical problems. Either can suggest a home hasn’t been generally well-maintained.

These are both DIY-friendly fixes that could boost your home’s value. If you’d rather hire a professional, a Zillow and Thumbtack report finds you can expect to pay, on average, $205 to replace a faucet and $380 to replace a light fixture.

Clean the Carpet

A clean carpet is critical if you want your home to make a great first impression. Steam cleaning will often do the trick, but if your carpet is torn or has permanent stains, you’ll want to replace it.

Zillow uses Mohawk brand carpet in either Charger Classic or Scout Highgate. Selecting a high-performing, stain-resistant carpet in a neutral taupe color will appeal to the most buyers and add value to your home.

Sweat the Small Stuff

Zillow takes care of all the items that make life easier for the home’s next owner. These items include landscaping, servicing the HVAC system, and replacing all light bulbs and batteries in smoke and carbon monoxide detectors.

By taking care of these items before putting your home on the market, you can boost curb appeal and give a potential buyer confidence that your home has been well-maintained.

Say No to a Full Reno

Home improvement TV shows often suggest you need a gut renovation to get top dollar in resale. However, Zillow research finds big renovation projects hardly ever pay for themselves when it comes time to sell, with a few exceptions.

Zillow rarely completes any major upgrade to a home that would dramatically alter its footprint or its value. Instead, Zillow focuses on the projects that make a home clean, safe and functional for a buyer, repairing items instead of replacing them when possible.

“Buyers often want to put their own stamp on a home and have it reflect their taste,” says Lindsey DellaSala, a broker with the DJ and Lindsey Team in Jacksonville, FL. “Let’s say you decide to upgrade your backsplash before selling. The trendy statement tile you love may not be what a buyer is looking for, and that could hurt, rather than help, your chances for a speedy sale.”

“When a buyer walks into a Zillow-owned home, they know it is move-in ready and they can add their personal touches over time,” says Claire Caldwell, Senior Director of Renovations at Zillow. “By creating that same kind of blank canvas in a safe and clean home, you can help buyers better envision their lives there.”

Embrace Tech

Online curb appeal is more important than ever, as most home shopping has gone virtual. Zillow-owned homes are listed for sale with professional photography, a floor plan with dimensions and a virtual 3D Home tour that gives shoppers an immersive experience of a home from the safety and comfort of their own living room.

Sellers can harness the power of tech to showcase their home’s best features by using the free 3D Home app to create a virtual tour, and explore other digital tools such as virtual staging.

(JtR: Big difference between ‘high-tech’ and robotic, which is the sales method they are pushing)

Link to Article

How Much Over List?

We’ve had 208 closed SFR sales between La Jolla and Carlsbad this year.

How crazy is it?

Eighty homes sold over the list price, which is 38% of the total number of sales. Of those, most were just $10,000 to $50,000 over list, but there were some big bombers:

Most % Over List Price

List Price
Sales Price
Percentage Over List Price
$1,150,000
$1,500,000
30%
$1,500,000
$1,750,000
17%
$1,850,000
$2,100,000
14%
$1,500,000
$1,710,000
14%
$650,000
$740,000
14%
$2,199,000
$2,475,000
13%
$2,395,000
$2,660,000
11%
$2,250,000
$2,495,000
11%
$2,995,000
$3,300,000
10%
$1,449,000
$1,600,000
10%

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It’s not just paying more than the list price. The listing agents will test your mettle too.

Here’s a seller counter-offer on a million-dollar home with nine offers on it:

The house was built in the 1980s, and you expect the buyer to take it as-is without a home-inspection contingency? And you’re going to get 5% to 10% over list price, but you can’t throw in a home warranty?

There will be buyers who would have paid more money but who drop out when they see the extra demands.

Listing agents believe that this is how you get rid of the buyers who ‘aren’t serious’, but in reality it just limits the remaining buyer pool to the emotionally-charged-and-will-sign-anything buyers.  They are the ones that are less likely to close escrow.

‘End of Forbearance To Be A Non-Event’

Health, unemployment, stairs, taxes, finances, politics…….selling your home is becoming the answer for everything!

More than 2.5 million American homeowners have stopped paying their mortgages, taking advantage of penalty-free forbearance periods offered by lenders.

What happens when the free pass fades away next year?

Not much, and certainly nothing approaching the flood of foreclosures that defined the Great Recession, according to the emerging consensus among economists. While some homeowners are sure to feel the pain of forced sales, housing experts increasingly expect the end of forbearance to be a non-event for the gravity-defying housing market.

That’s largely because home prices have risen sharply during the coronavirus pandemic. As a result, homeowners who find themselves unable to pay their mortgages when their forbearance periods end likely will be able to sell for a profit, rather than going into foreclosure.

“If they have equity, they can always sell off the house and pay the mortgage,” says Ralph DeFranco, global chief economist at mortgage insurance company Arch Capital Services. “It’s not a great outcome, but it’s less terrible than letting the bank take it and sell it.”

Link to Article

Who Is Moving Where?

Ryan was nice enough to provide the latest data (2019) from the U.S. Census Bureau on where Californians are moving, and where our new residents are coming from – at least before the pandemic.

The big winners on a net basis:

More Californians moved there:

Texas:  +45,172

Arizona: +31,486

Nevada: +20,889

Oregon: +20,662

Washington: +14,909

Colorado: +14,265

Florida: +5,936

N. Carolina: +4,160

More People Moved Here

New York: +13,235

Illinois: +9,085

Virginia: +7,512

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Will Prop 19 Increase Inventory?

The U-T asked their twelve real estate experts about the effects of Prop 19:

Q: Will Prop. 19 substantially increase home inventory in California?

Of the local experts, 11 out of 12 said NO, and the justification for the one YES answer could have been just as easily been reasons to say NO.  Gary’s answer above was the best and most-accurate. See the rest here:

Link to Article

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Political Exodus

Anyone surprised to hear there are agents soliciting consumers based on their political beliefs?

At first, Stephanie Morris was nervous about leaving Modesto. She’d lived in the Central Valley her whole life, but her family couldn’t keep paying $850-a-month for her sons to share a living room while she, her husband and the baby slept in their apartment’s only bedroom.

The anxiety faded by the time her family pulled out in a U-Haul bound for Salt Lake City on a smoky September night. Morris, 31, had still never been to Utah — her husband liked it when he worked there as a truck driver — but she had discovered a whole world of people planning similar escapes online. They posted faraway landscapes on Pinterest, smiling family photos on Instagram and memes about leaving “Commiefornia” in Facebook groups like “Conservatives Leaving California.”

“I have to keep reminding myself that I’m not moving out of California to a third-world country,” Morris said. “I’m leaving a third-world country to join America.”

Unaffordable housing. High taxes. A Democratic stranglehold on state politics. The concerns driving transplants like Morris out of the country’s richest state during the COVID-19 era are not new. What is changing quickly is how disillusioned California residents are coming together by the tens of thousands on Facebook, YouTube and elsewhere online, fueling a cottage industry of real estate agents, mortgage lenders and political advocates stoking social division to compete for a piece of the muchdiscussed California Exodus.

Facebook groups like “Life After California” are full of stories about $4,000 U-Haul bills and home bidding wars in Texas, but it’s too early to tell if more people are leaving during the pandemic. People move for all kinds of reasons — a new job, to be near family, to buy their first house — and while many online moving groups target conservatives, a parallel migration of more liberal transplants has also scrambled the politics of some red states.

Early polls show that up to 40% of Bay Area tech workers will consider leaving if remote work continues. Recent tax proposals have also triggered familiar warnings about wealthy residents fleeing the state.

Even before COVID-19, California’s population growth had slowed considerably. Since 2015, the state has lost at least 100,000 more people than it gained each year from other U.S. states, including growing numbers of working class and Black residents. But California is still a top U.S. destination for people moving from other countries, plus affluent transplants from other states. From July 2018 to July 2019, California saw a net loss of 197,594 people to other states.

Scott Shepard has watched these forces collide from his new home in Coeur d’Alene, Idaho. The California-bred realtor started relocation website ExitCalifornia.org and a namesake Facebook page early last year, when he saw a business opportunity in the endless stories of friends and neighbors moving out of state. Now, during the pandemic, the site is so busy he doesn’t have to pay for online ads.

“It’s starting to kind of take on a life of its own,” Shepard said. “I would be straight and say that it is primarily political. Then it really does come down to the cost and taxes.”

The anti-California Dream

Exit California is emblematic of a growing number of online relocation companies marketed heavily on social media. They target prospective transplants who skew white, right and over age 30, though renters post alongside members in the market for million-dollar houses. Between photos of tidy brick facades, crystal-clear pools and recommended moving truck routes, the Facebook pages revolve around ominous articles about Black Lives Matter protests, crime, immigration and, of late, pandemic shutdowns.

Prospective movers who click through to the website can pick a state — Arizona, Idaho, Tennessee, Texas — and see financial incentives to use selected realtors, mortgage lenders or other service providers. Beyond the mechanics of buying a house, the online groups are a platform for places to pitch fed-up Californians who don’t know where to start.

“There’s a fair percentage of them that don’t know where they wanna go,” said Scott Fuller, an Arizona transplant and real estate investor who started LeavingTheBayArea.com and LeavingSoCal.com three years ago. “They just know they want to go somewhere else.”

That’s not surprising to Bill Bishop, author of “The Big Sort: Why the Clustering of Like-Minded America Is Tearing Us Apart.” He’s studied how over the past several decades, neighborhoods across the country have become increasingly politically homogeneous. Where people choose to live has become “a stage,” he said, to flaunt their values as old anchors like a one-company career fade into a blur of unstable jobs, anxiety and dwindling time with family and friends.

“What they’re doing is selling a way of life that then corresponds to political choice,” Bishop said. “It’s kind of pathetic, actually, but what the hell?”

Playing politics

It’s not just real estate agents using social media to reach jaded Californians. Sometimes, the California Exodus content is bankrolled by people in high places.

Take the YouTube video “Fleeing California,” which has racked up 2 million views since it was posted in March. It starts with sweeping L.A. views of palm trees and Spanish-tile roofs, then fades to a grainy montage of sidewalk tent cities and a person being pushed in front of an oncoming truck. A moment later, in Texas, viewers see happy kids getting off a school bus and a golden retriever bounding down a jungle gym while Republican Sen. Ted Cruz talks in the background.

The video was made by PragerU, a conservative digital media nonprofit that produces other titles like “Make Men Masculine Again” and “Dangerous People Are Teaching Your Kids.” The California video was commissioned by a donor, producer Will Witt said: Texas ranching and oil scion Windi Grimes, a board director of the Texas Public Policy Foundation and member of Trumpettes USA, a women’s group formed in Beverly Hills five years ago to boost President Trump as the country’s “savior.”

How many people are persuaded to pack up and move by similar videos, social media content or Joe Rogan’s recent podcasts on moving to Texas could help shuffle the country’s electoral map at a pivotal moment. Some of California’s last Republican strongholds, like Orange County, are seeing their residents decamp for other states — a net loss of nearly 25,000 people last year alone — along with notoriously liberal urban areas like L.A., which posted a net loss of more than 97,800 people.

The anti-California political spectacle playing out online has become a hobby for 30-year-old Texas country singer Charley Austin, who started the “Conservatives Leaving California” Facebook group last year. Some members post memes warning newcomers “Don’t California My Texas.” But Austin, who says he has campaigned for Trump, sees an opportunity to keep the state red as cities like Austin (“the San Francisco of Texas,” he said) go farther left.

“There’s nothing really we can do to stop people moving here,” Austin said. “The best thing you can do is help people that move here get acclimated to the state.”

More stories here:

https://calmatters.org/economy/2020/09/anti-california-dream-moving-industry/

More Frenzy Fuel

San Diego didn’t make the NAR list of vacation-home areas (counties where 20% of the housing stock is for seasonal use), but our market should be enjoying some additional second-home purchases:

Vacation home sales are outperforming total existing-home sales. Sales of homes intended for vacation use rose to 109,100 in the past three months of July-September, a 44% gain from the level of 75,600 sales during the same period last year, according to NAR estimates based on information gathered from the monthly REATORS® Confidence Index Survey and NAR’s existing-home sales estimates. In comparison, total existing-home sales during July-September rose 13% year-over-year (1.72 million in July-Sept 2020 vs. 1.52 million in July-Sept 2019).

The pandemic and low mortgage rates have increased the desirability and affordability of owning a vacation home. Buyers may be desiring a vacation home as a weekend getaway as urban-based leisure activities are still constrained by social distancing. The ability to work from home also means buyers who can work from home can spend more time at and enjoy their vacation home. Historically low mortgage rates have also made a home purchase more affordable, while rising prices in past years have yielded larger home equity gains that can be tapped (through say a home equity loan) to use for a down payment.

Link to Full Article

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