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!