Wednesday, August 17, 2016

Contingent Offers

CONTINGENT OFFERS.....all of a sudden I've had a number of clients who want to make a "contingent" offer  on a property.  They're afraid to put their home on the market for fear it will sell and they won't have anyplace to move to.......but, on the other hand,  seller's are very very very hesitant to accept any kind of contingent offer because they know the stronger offers are those where the buyers are already preapproved and do NOT have to sell another property.  It's been a big challenge lately.  Whether someone is looking to "downsize"  or move up into a larger home,  it's a challenge for both the buyer and the agent to get a transaction like this together.  Sometimes clients are very adamant about "just trying" to see how a seller responds,  but to be perfectly honest,  it has been my experience after 38 years in the business,  that it is a B I G waste of time for everyone.
That being said,  I will say that I HAVE written several contingent offers in the past few months.  Not because I thought they would be accepted, but because I have some great clients who will keep coming back to me but who still do not totally "believe" it's a waste of time.  So we write the offer and we get rejected.  Every time!  Not only are we in competition with non-contingent offers, we're in big-time competition with all cash buyers!  Yes, there are still alot of cash buyers out there....and if you happen to be writing an offer on a property where you're in competition with cash buyers, forget it.  You're cooked!  

IF a property has been on the market longer than normal (like over 30-45+ days) you "may" stand a chance....OR if the property is over-priced or priced higher than other comparable homes in the neighborhood and you're willing to make an offer that the seller may consider (in spite of it being too high $$)  then your odds go up.  You may be the only one making an offer on that kind of a property so you very well "may" get a seller to accept a contingency and give you maybe 30 days to get your home sold and in escrow.  But those are probably the only kind of properties where a seller, in today's market, may consider a contingent offer.

Now,  come fall or winter, the market may adjust with more active listings and you may very well find seller's willing to consider a contingency.  But current statistics are indicating that prices are not going up as quickly as they had in the past, and you surely don't want to offer too much for a home just to entice the seller to accept your contingency. I don't think we're going to see a rapid decline in prices, but we're sure not going to see skyrocketing values between now and next spring.

One of my current clients wants to purchase a larger home in a better neighborhood.  After considerable discussion and consultation,  we listed their home for sale and are now in escrow. Their plan is to store more of their belongings and move into an apartment so they're in a better position with their money in the bank, and be preapproved to purchase another home.  Not all sellers are willing to do that.  In this market though,  that's about the only alternative IF you're set on making that move.  Some seller's "used" to list their home for sale "contingent upon them finding another suitable property".   Well,  that doesn't set well with prospective buyers though either.  When they find a home and fall in love with it,  they don't want to have to wait until that seller finds the
"home of their dream" before being able to accept the offer.  That means the buyer sits and waits and maybe loses out on other potential homes while they're waiting for the seller to decide what they want to do.

So IF you're thinking about making a move, talk to your real estate professional  and figure out a strategy.  Putting your home on the market and making a move can be a smooth transaction if you have a plan and a good professional Realtor to help you.  There are many excellent Realtors in our area.  Find one who is willing to sit down and talk to you about the best way to proceeed.  Whether you're ready to do it today....or are thinking about a future move,  it's never too late to be prepared.
And those of us who have been in the business for so many years are always happy to help you however we can.  Just pick up the phone and call or text!

Thursday, May 19, 2016

Choose Your Realtor Carefully......everyone knows "someone" in real estate.....a relative, a friend, a many real estate agents are there in Sacramento alone?  ALOT!
Does that mean all real estate agents are "created equal" ?  Absolutely not.   I'm all for "keeping it in the family"  and using your sister or your mom as your real estate agent because it keeps "harmony" in the family.  What I'm NOT for,  is when you pick up the phone and randomly call a real estate office and talk to whatever agent is on "floor duty" that day.  You never know who you're speaking to or what their credentials are.  I'm sure there are many agents who take floor who are very qualified....then again,  there are other agents who are part-time,  or who have little or no business and who sign up for floor duty because it might bring them that one and only client.   Don't make that mistake.  It could be a catastrophic decision on your part.  There are many many good, professional hard working agents out there.  Do a little research and look at their website,  see if there are any testimonials (and call them!),  what kind of credentials do they have,  how long have they been selling real estate?  You want a Realtor who can get you through your transaction smoothly....solving any issues before they happen.  95% of all transactions go very smoothly and it's because you've selected a good agent.  Little "glitches" do sometimes come up, but you want a good agent on your side to get you through these glitches unscathed.  

The reason for this particular article is because I just wrapped up not one,  but two sales with an agent who probably should not be selling real estate.  He changed buyers on BOTH transactions mid-escrow,  would not return calls from the title company, his lender or me and we had an incredibly difficult time getting disclosures back.  It wasn't until we submitted a "48 hour notice to perform"  that we got any results.  My seller was ready to put the house back on the market because of his incompetence.  Before the 48 hours was up,  his buyer finally "did" perform and we were able to get it recorded.   Fortunately, my 91 year old seller was as cool as a cucumber and was happy when her proceeds hit the bank.  

I've been selling real estate for a long long time and I love what I do.  I know that solving any issues that come up, come as a result of many years of experience.  I also know that there are many other Realtors who haven't been selling this long,  who also have good skills to help you solve any problems.    So it isn't necessarily a prerequisite that your Realtor have 35 years of experience,  but it does mean that your Realtor should know what they're doing and have good skills and professional experience to make your transaction run smoothly toward a successful closing.  

* Thanks for reading my articles....I love selling real estate and would love to help you when you're ready to buy or sell!

Monday, April 4, 2016

You've accepted the offer, now what about the appraisal?

Last weeks newspaper had a great article about appraisals.....who does them, who pays for them, why they're important and what happens if the house "doesn't" appraise at selling price.  And,  like Ryan Lundquist mentioned in his article,  there are a lot of "it depends" associated with the answers.  Sometimes I get calls from clients who ask me whether it's worth investing in a brand new kitchen or brand new bathrooms if they're planning on selling in the near future.  I always say, "it depends"....and really,  it depends upon a lot of different factors.  For instance,  are you going to invest $90k in a fabulous chef's kitchen.....or are you going to just replace the countertops and cupboard faces?  Are you going to install hardwood flooring in the kitchen, or just new vinyl?  Same with bathrooms,  are you totally gutting the bathrooms and replacing everything, or just doing new tile or granite and maybe a new vanity?

My answer most of the time involves asking those clients if/when they plan to sell and whether they're going to invest a lot of money or just enough to "spruce it up".  Like Ryan's article,  IF you're in a higher end location and neighborhood,  it might be worth every dime to gut your old kitchen and do a high-end remodel.   If you're in a more modest neighborhood,  you should perhaps consider just doing a basic upgrade.  Investing thousands and thousands of dollar in a remodel, for a home that's located in a neighborhood of $150-$250,000 homes, will not guarantee that your home's value will increase by the amount of money you use to remodel it.  If though,  you take that same home and maybe replace countertops, replace appliances and a fresh coat of paint.... voila! you may have insured that your home might be the first home to sell once it goes on the market. Even "little" improvements make a big difference.

Now, getting back to "value" and appraisals when a property is sold,  the appraiser looks at exactly the same "comps" that your Realtor uses when listing the property.   If a Realtor thinks the house is worth say $400,000 based on other "comparable" properties and has sales to substantiate that price,  then usually you're home free and all goes well with the appraisal.  If, though,  the seller says "yes, but MY house has a bigger kitchen,  or nicer carpeting,  or a newer roof....then I want $25k more than what those comps say"......  you "could" be challenged when trying to get it to appraise at the selling price.   Granted,  appraisers DO  give value to items like new roofs,  newer cent h/a,  larger garages and maybe outdoor kitchens,  but you really have to be able to substantiate that value in order to get the buyers' (lender) appraiser to take those items into consideration in value.  

Major challenges come into play when there are multiple offers on a property and buyers and/or their agents say "let's just offer higher, impress the seller with offering more $$$$ and get it accepted!  In reality,  they know they'll be re-negotiating if that appraisal comes in the actual "value" of the property and not the inflated, multiple offer price.  This puts everyone in a very awkward and difficult position when that happens.  And trust me,  it happens ALL the time when there are loans involved in the purchase and there are multiple offers.   Realtors try their best to prepare seller's in advance for what may happen with the appraisal.  Sometimes seller's roll the dice and accept the highest offer, regardless of what may happen with the appraisal.  Others are realistic and exam, with their Realtors, what all the terms and conditions of the offers are....including how much cash a buyer is putting down, what their earnest money deposit is,  and how willing a buyer might be IF there's a discrepancy between the accepted price and the appraisal.

So,  when you're listing your house for sale,  do yourself a favor and ask your Realtor to explain how the appraisal process works and examine some of the "what if's".  It's prudent to be well informed on the whole process so there are no surprises once you get into escrow.  In my 37 years of selling real estate, I've always been of the persuasion that when seller's are educated and well informed of the process,  everything goes very smoothly.  Unexpected surprises are not a good thing.

Call or email me if you have any questions!  I'd love to help you however I can.
PattiMartinez. net       email:     (916) 768-3157 cell/text

Thursday, February 25, 2016

When the deal falls through......

Your buyer competes with 6, 8 10 other buyers on a property and becomes the successful purchaser.  Yipppeeeeeee, everyone is so excited and you're ready to move forward.   Escrow is opened, buyer works with lender to get all documentation in, appraisal is ordered,  home inspection is ordered.  Home inspection will be done fairly quickly, because more than likely, your buyer limited the inspection time period so his or her offer would be more competitive, right?  Then comes the home inspection.  Home inspector does a nice thorough job and buyer shows up toward the end of the inspection so inspector can give an "overview" of what has been found.  Actual hard copy of the inspection follows either that same day or the next.

That's when the stress starts.  Buyer's eyebrows start going up........beads of sweat start forming on buyer's  brow as the home inspector goes thru items he's found.  What does it mean when he says "pressure relief values empty into kitchen sink instead of under the house"...???   How problematic is it when he says stove vents don't go all the way thru the roof, but instead vent directly into the attic?
Is it a problem if rodent droppings are found scattered throughout the attic?  And what about the electrical wires that aren't in conduit, but instead are hanging under the house and not secured as they should be?  More than likely,  a number of items like this will be discovered.  Unless the house is a brand new house,  "stuff" shows up.  Some can be catastrophic, others are simply "maintenance" items.  A good home inspector will explain the difference between the two and tell you which ones may be  deal breakers and which ones won't.  And,  it also depends upon how handy you are or how much money you have to correct those items.

What home inspections are NOT,  are not golden opportunities for buyers to renegotiate a radical drop in sales price in order to make said corrections. Though that may happen.   Our contracts now say that the properties are purchased in their "as is" condition unless otherwise negotiated between buyer and seller.  What inspections are meant to do,  is enlighten the buyer are to exactly what they're buying....what the condition of that property is.    Seller's complete a TDS (Transfer Disclosure Statement)  and provide it to the buyer and on that form and, if they're honest about it,  should disclose whether there is anything that may or may not affect the desirability or material value of that property.  They can't disclose what they don't know or what they don't see or what they aren't aware of,  so a home inspection can and does disclose things that indeed "may" affect the desirability or value of the property.  That is why it is absolutely prudent for a buyer to have those inspections, which include but are not limited to whole house,  roof, sewer, electrical or anything else buyer wants to have inspected during the inspection time frame stipulated in the contract.

Then,  once buyer has gotten the verbal "overview" from the inspector and has cautiously perused the written report,  it's time to sit down with his or her agent and either 1) draft the Contingency Removal or 2) prepare the Request for Repairs.    The seller will respond in any number of ways in order to try to reach a successful conclusion.  The seller may agree to complete all the repairs requested,  may agree to complete "some" of the repairs and not others,  may reduce the price or may offer the buyer a "credit" toward closing costs (being most lenders will not allow a credit in escrow for any repairs).

If an amicable resolution is reached, everyone is happy and escrow proceeds to close as scheduled.
If no resolution is reached,  with buyer and seller not able to reach agree,  depending upon a number of legal factors, a Cancellation of Contract is submitted.  This is not always a bad thing.  Sometimes the work called for overwhelms a buyer but seems minor to a seller.  But, in my opinion,  if a sale is going to "go south" and die,  it's always better for that to happen early in the escrow as opposed to just before it's scheduled to record.

Bottom line though,  is to make sure buyer has any inspections they desire, within the stipulated contractual time period.  At the end of those inspections, buyers will know pretty much all there is to know about the property and can make educated decisions and, hopefully,  be thrilled with their new purchase....and buyers and sellers come away satisfied and happy.   That is everyone's goal.

( * The opinion expressed in my blog is solely my own through my 38 years of real estate experience. I do not give legal advice and always recommend my clients seek legal counsel if further clarification is requested.)  

Tuesday, February 16, 2016

Virtual Reality Technology for viewing homes

Woweeee zoweeeeee! Look what's coming!  An article in the New York Times last Sunday had a article on what will soon be a buyer's easiest way to view potential listings.  When listings started getting posted online and buyers were able to sign up at various websites to be notified when listings in their preferred neighborhoods came up for sale, we thought it was great.  Buyers could then peruse the listings at night  or from home without driving around and around (or making the agent drive them around and around).....and determine which houses they wanted to see.  Then came the "drones"....and we all thought that was quite the technological advancement.  But now!  Now we're starting to see virtual reality technology that will allow buyers to put on a headset and "walk thru" the property without even stepping foot onto the property!  It appears that in New York City builders and developers are using this technology to market properties that haven't even been built yet.  They're able to pull up renderings of specific apartments and views of structures that haven't even been built yet.  The technology is expected to transform the real estate industry and may make house-hunting even more efficient!  It is hoped that this technology would give companies a competitive edge in marketing their properties.

The downside?  One salesman who was "trying out" the headset said he kept "bumping into" virtual walls and the headset was making him extremely nauseated. There is another technique though, used by another developer in Manhattan that uses a giant video wall to allow buyers and their executives to walk around the building and units being built, without the goggles.  They said they didn't want the investor who may be writing a multi-million dollar check to get dizzy and sick.   Another alternative suggested is the Google cardboard headset which typically costs less than $10 and that will soon be used by The Corcoran Group in New York.  They'll hand them out  with a "show sheet" that has a quick response code on the sheet that automatically starts the VR app.  Possible enhancements to the virtual experience are being evaluated and, amazingly enough,  it is even suggested that smells and tastes were being'd be able to smell fresh lemons or cookies baking in the oven.......!!   Once these headsets have been perfected and viewers aren't getting queasy and dizzy, think how efficient this would be.  

But don't forget!  Realtors are your lifeline for getting that perfect property and getting the best deal!
Make sure you have a good strong professional experienced agent to represent you!  

Tuesday, February 9, 2016


Whether you plan months in advance to put your home on the market for sale,  or it's a fast decision being you've found another home to buy,  there are definitely some low-cost improvements that you need to make in order to get the highest and best price.  Oftentimes, when we've lived in our homes for many years, we start to "not see" or "overlook" some of the maintenance items that need to be done.   The threshold at the front door that has become scuffed or scratched,  the windows that may need cleaned,  the weeds that have started popping up after the warm weather we've been experiencing.   I know there are some sellers who feel,  "well, we've lived with these things for several years and no one is going to notice a few scuffs here and there" me,  they will.  AND, they'll make offering price adjustments relative to what they feel they'll need to do.  So........
if your budget allows,  take an honest look at items you've been "living with" and see if you can have them fixed or repaired before the home goes on the market.  You will absolutely be glad you did!  You'll be rewarded with more showings and better offers.

Take an "impartial" friend or relative, along with your notepad,  and walk carefully through your home.  Make notes of closets that need cleaning out,  fingerprints on doors or cabinets,  windows that need washing,  thresholds that need painting......anything that could be fairly quick fixes first.  If you know for sure that you're going to be moving when your home sells,  start boxing up and packing all those items that you won't be needing within the next month or so.  Like all the extra towels and sheets in the linen closet,   the books on the bookshelf, the dishes and pots and pans that you only use for holidays or when you have lots of company.  It's amazing when you start going through your stuff, how much "stuff" you have that you don't use regularly.  Box it up to take with you,  donate it, or give it away!  It's a wonderful feeling to unload "stuff" you haven't used in months or years.....give it to someone who may actually use it!  Or sell it on Craigslist....or donate it to a charity of your choice.
Free yourself from all the stuff that has accumulated over the years that you have no need for.

Once you've started de-cluttering,  look impartially in your rooms and see if you have way too much furniture in there.  Rooms  look larger when there is less furniture in them.  If you're moving into a larger home, of course you won't want to dispose of or sell that extra furniture, but definitely either store it in your garage or get a storage space while your home is on the market.  Just make sure you don't store all the sure you have ample lighting in each room, especially if you don't get good sun exposure in that room.  There's nothing worse than having a buyer walk into a room that's dark and almost sets the tone for the rest of the home.  Lots of light....always good!

Another thing that often sets the "tone" of the buyers walk-thru is if there is an animal smell of any kind OR a stale cigarette smell.  We don't see many "cigarette smell" houses any more,  but they are definitely out there.   When I've mentioned the cigarette smell to a seller before,  they said "but we don't smoke in the house"!  Guess what,  they have no clue that cigarette smell permeates their clothing,  their breath and the inside of the house.   The dog bed, the cat box and the cigarette smell
probably kill a potential sale quicker than anything else I can think of. Oftentimes buyers won't even look at the rest of the house if those smells hit them when they walk in the door.  

The good news is,  every home is salable!  You may have what, in real estate school, they call "functional obsolescence" by being next to a freeway,  across from the train tracks, in the middle of a commercial district (there are lots of things that contribute)....BUT rarely does a home not sell if it's priced right and shows well.  You can overcome many of the challenges.  And you can do lots of little things to spruce it up without investing in a lot of money.  

Remember,  you never get a second chance to make a great first impression!  Make your homes' first impression the best!  You can do it and your reward will be higher price and more offers!  Let's get crackin' and get you top dollar for your home!!  

*Call, text or email me if you're thinking of putting your home or one of your investment properties on the market for sale....put my 37 years of real estate experience to work for you! I'd love to help you. (916) 768-3157


Thursday, February 4, 2016

Update on current market conditions

Well,  you've been hearing it over and over and over.....our inventory is sooooo low!  Our market isn't exactly like the Bay Area and San Francisco with their $100k overbids, but I'm telling you it's pretty tough out there for buyers.  The last several offers I've written were in "multiple counter" offer situations.  Doesn't matter whether you're looking to buy an investment property (that pencils out) or a single family dwelling.  The multi-units that are on the market currently in Sacramento, for the most part,  are either over-priced,  in bad condition or bad locations.  Certainly that doesn't apply to ALL of them, because indeed there are a few new listings that are in beautiful condition,  in good locations, but also priced so high it's almost laughable.  

With regard to single family dwellings,  East Sacramento values are higher than Land Park....average 2 bdrm home in Land Park is between $350-$480,000 and in East Sac most are at that higher price point.  And you can forget duplexes!  Once those come on the market, if they're priced where they should be,  they're snapped up lickety-split!  Duplexes are hot right now.  Regardless of the neighborhood.

If you're a buyer and looking to buy .... definitely be pre-approved before you either go out looking or make an offer on a property.  Seller's definitely shy away from offers that come in without that pre approval letter,  a decent earnest-money deposit and a cover letter showing your interest.  The more down payment money you have, the better.   And contingencies pertaining to the sale of your current home?  That's a tough one.  Unfortunately,  unless there are no other offers on the table, most seller's will counter that condition.  And in some cases,  they'll ask you to remove the appraisal contingency!
(Which means if the house appraises at lower than the selling price,  you come up with additional cash to make up the difference.)  If the seller DOESN'T ask you to remove that contingency in your original offer, at least you have the security of being able to re-negotiate the price if the appraisal comes in lower.

If you're a seller.....HURRAY HURRAY for you!  That doesn't mean you can ask whatever you want for your home (necessarily), because you too are going to deal with the buyers' lenders' appraisal......but it does mean,  if your home shows well and is priced right,  it's money in the bank!
Of course, having windows washed,  clutter removed,  weeds pulled,  maybe fresh paint and some last minute maintenance items're going to sell quicker.  Sometimes sellers don't realize how important it is to clean out closets and shelves,  de-clutter knick-knacks, books, kids toys and stuff you're not going to need while the house is on the market.  It really really makes a big difference.   And curb appeal is especially important too.  $40 worth of nice bedding plants can make a very nice first impression.  Painting and touching up the threshold and front door makes a difference too.

If you need help deciding how to prepare your home for sale.....or if you're thinking about buying a home, CALL can call, email, text me or go to my website.....I'd love to help you.
Put 37 years of experience to work for you!  Let's get it done!

Wednesday, January 27, 2016

Open Houses - Low Inventory

Buyers are coming out in droves for Open Houses!  We can barely get the signs out and folks are waiting at the front door!  As you're aware, if you're in the market for a new home,  our inventory is low low low and there are multiple offers on practically every listing!   IF you're in the market, be sure you're prepared by being pre-approved for your loan prior to going out looking.  Sellers will almost never give an offer consideration unless there's a pre approval letter attached to the offer. So that's the absolute best starting point!  Secondly,  be sure you're working with a who is experienced and a real advocate for you, especially if you're going to be in a multiple offer situation. Even after being in the business for 37 years, I attend real estate forums, classes and events where I "mix" with other agents, because it "could" make the difference between whether the other agent knows me and knows I'm an experienced, ethical agent.....and one who they have perhaps never heard of or sells real estate part-time.   In a business like real estate where laws and contracts and documents are updated and changed regularly,  it is absolutely imperative that the Realtor knows what they're doing and knows how to protect your best interests.  I can't emphasize that strong enough.  Be prepared before you go out looking.  Find a good Realtor.....and find a great new home!

Monday, January 11, 2016

INVENTORY:  Whoa....!!!!  we need houses to sell!!   Our inventory is soooo low right now.  We're not sure whether the Christmas holidays brought things to a standstill or maybe the cold damp weather is keeping sellers from putting their homes on the market,  but one thing is for sure.....there are buyers out there looking and watching and hoping more homes come on the market for sale.  Interest rates went up just a tiny titch so that really hasn't made an impact on buyer's ability to buy.

I have a buyer who is looking for  a duplex in midtown,  East Sac, Land Park or Greenhaven/Pocket and honest to goodness, the pickings are slim.  Today there are only 2 duplexes for sale in Greenhaven/Pocket and as of last weekend, maybe 3 duplexes in all of 95811,95814, 95816,91518, 95819 and 95831. Unbelievable.

If ever you're going to have little competition and want to get the best price for your property.....I've got news for you......LIST IT TODAY.  Prices aren't skyrocketing, but they're definitely holding steady and certainly not going down.  And with practically no inventory,  you're going to be thrilled with the activity your property will generate.

It's a great time to be a seller........

P.S.  I just sold and closed 3 duplexes in Greenhaven/Pocket/midtown in the past couple of months and each one had multiple offers!