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Are you trying to sell your property and it’s been sitting on the market for days, weeks, maybe months with no action or offers to speak of?

– Or –

Perhaps you listed your house on the market, and it never sold?

Many times, there are extenuating circumstances that impede a property from being sold. However, most often, the truth is that there are typically three common themes that lead to a property’s inability to sell. These are the Top 3 reasons why your property hasn’t or did not sell.

3. Accessibility

The third most common reason why your property hasn’t sold is due to ACCESSIBILITY!

Do you have nasty tenants who have not allowed potential buyers or agents into the property to properly view and visually inspect it? Selling with tenants can be more than challenging and often they can stand in the way of allowing suitable buyers and potential offerors from bidding on the property and getting you into escrow!

The name of the game is getting eyes on your property and enticing them to bid on your house.

Maybe, you are standing in the way. Do you have a nearly impossible schedule that is less than “Showing Friendly”? Maybe you work from home, you have a day sleeper or a newborn child, so you’d like buyers to work around your schedule. This is totally understandable, and as realtors go, we typically like to work around your schedule to inconvenience you as little as possible. However, there is a point where we need to have a “come to Jesus’ talk about accessibility. The name of the game is getting eyes on your property and enticing them to bid on your house.

Though beautiful pictures and online marketing help with visibility, the truth of the matter is that most buyers want to physically be in the property. They want to personally experience the property, something you can’t do online (yet). Thus, it is of the utmost importance to allow buyers as much access as possible.

This is an easy fix! Having more and frequent access to the property will lead to more foot traffic and typically will manifest offers–which is why you have your property on the market in the first place!

2. Condition/Presentation

The second most common reason why your property has not sold may have to do with its condition.

Ask yourself this: Is your property indeed a fixer and are you marketing it as a luxury property? All kidding aside, the condition of your property has a lot to do with the number and level of offers you are obtaining. Does your property have curb appeal or is it the ugly duckling of the street? In what condition is the interior? Is it dirty, cluttered, in need of repairs and maintenance?

Dig deep and put yourself in a buyer’s shoes. Most Buyers (9 out of 10) do NOT have the visualization skills to see themselves (their furniture, their color pallet, etc.) in your property. So you need to help them by decluttering, cleaning and making the property look and smell brand new.

Think of making it as generic as possible because when it comes to staging your home for sale, LESS IS MORE!

It starts with depersonalizing the property–taking down all those lovely pictures of your kids and finally getting rid of that hideous table your mother-in-law gave you, and possibly painting that beautiful blood red accent wall with a neutral color. Think of making it as generic as possible because when it comes to staging your home for sale, LESS IS MORE!

1.

The number one reason your property has NOT SOLD is… drum roll, please…

.

.

.

PRICE!

Yes, I said it, PRICE! It’s that simple. You and your current, or previous, real estate agent is/was too scared to tell you because they most likely didn’t want to make you upset.

Look, I’m not going to pull any punches, I’m in the business of Selling Homes, not just putting them on the market. Price, along with a buyer’s perceived value, is the key to moving your property. I’m not saying that you need to give away the property by discounting, but you do have to play with market forces and do some fantastic PR!

You might be thinking, “Well how the heck to do I price my property smartly and still make Top Dollar?” Phenomenal question! The key is to account for the size and scope of your property, along with its upgrades, features, and benefits compared to the most recent sales in your neighborhood, factor in economic and market conditions (along with the aforementioned reasons) and price it right!-Just like Goldie Locks, not too hot, not too cold, just right baby!

Home Flipping “Shows” vs. Reality

Thanks to reality TV shows on networks like HGTV, Real Estate celebrities have become a trend much like “influencers” on Instagram. My wife and kids love watching these fix and flip shows from around the country and I love it when my kids ask, “Is this what you do dad?” I respond with a half-smile, “Kind of…” As a real estate professional in the business for nearly 16 years, I laugh at some of the staged goofs and gaffs that these TV agents and investors go through. Some of it is just plane fake!

The positive thing about the prevalence and popularity of these shows is that agents are getting cues from them and most marketing has enhanced amongst the ranks of your typical-every-day real estate agent. However, the negative aspect is that clients are also getting their cues from these shows as well! I am being a bit facetious, but there is truth to my statement.


Things don’t typically happen as fast nor with the facility that is displayed in these shows.

These shows have altered the perception of how things truly happen in real life.Though there is some truth to the dramatized acting, the reality is that most, if not all, footage is staged. Things don’t typically happen as fast nor with the facility that is displayed in these shows. The simple fact that the majority of these shows are half an hour, to one hour, misleads viewers into thinking the time elapsed on each project is tremendously fast. Let’s not forget that some of these programs have been filmed months to a year in advance of their screening, and typically filmed in markets with conditions and pricing that don’t parallel the market you currently reside in. This should be kept in mind when looking to purchase, sell or flip real estate.

What does this do?

This warps the perception of market values, conditions, supply and demand. Take for example the Show Fixer-Upper (which is now only in re-runs and my favorite of all the real estate shows): It takes place in Waco, Texas where the average priced home is $110,000, but in San Diego, CA the average price is $622,000 (bestplaces.net). That’s a huge disparity in price and may confuse and frustrate real estate buyers who can’t understand why that beautiful modern farm house that was purchased and remodeled on Fixer Upper for $300k total, can’t be had in San Diego.


In the reality of things, not all deals are winners nor do they always have a happy ending.

The purpose of this article is not to bash these shows, because honestly, you can actually gleam some great information and knowledge from them. Particularly when it comes to design and what to spend your money on when remodeling and flipping – I do love that aspect. Just keep in mind that these are TV shows looking for a “Hollywood Ending” and there’s nothing wrong with that. However, in the reality of things, not all deals are winners nor do they always have a happy ending. Every seasoned investor knows that you win some and your lose some. Great investors just win more than they lose.

Remember this,

The most important thing when buying, selling or investing in real estate is to do your homework. Understand market nuances and learn how to analyze deals – NUMBERS DON’T LIE! Partner with individuals and agents who are experienced, have strong negotiation skills and a depth of knowledge.

First off, I am not an economist. I don’t pretend to have a crystal ball to predict the future and I never make guarantees about future outcomes. There are times that lend themselves to make educated guesses about what the future may bring based on trends and other market factors, and this may prove to be one of those.

 

If you read my last article, you are aware that market forces are pushing residential real estate prices down and we’re in the midst of what I’ve deemed and “Affordability Bubble Burst.” Despite our robust economy, prices appear to be in decline, but not at the speed or depth of what we saw in 2008.  Many homeowners are questioning what they should do: Should you wait it out? Sell and go rent? Keep it and rent it out? Sell and Upgrade? Downsize? Every situation is uniquely different and motivated by your goals and current lifestyle, thus generalized answers are not suitable. That being said, if you’re a condo owner, I have some info to share with you.

 

Condominiums can be great investments and are truly a good way for first-time-home-buyers to get into home ownership. Condos are typically less expensive than single family residences (SFR) and often provide homeowners with wonderful amenities. They do go up and down in value, just like a single-family home; but the increases in value typically are not as large and the decreases tend to be big and fast.

 

Since we’re in a market with declining prices, I recommend being extremely vigilant of condo property values. If you’re of the mindset that you are happy where you are and in a good position, then market values do (up or down) won’t affect you much. However, if you’ve been contemplating selling your condo/s over the last year or so, then you need to pay close attention to what the market is doing.

 

If you own a condo that was purchased between 2010 and early 2016, you’ve probably seen some sizeable equity gains. NOW, may be the time to sell that condo!…especially if your condo is in a complex with an expensive monthly Homeowners Association (HOA) fee. Doubly so, if the property also sits in a high mello-roos district! Why? Mainly because of the reason stated above, a faster decline in values compared to SFRs. So, you want to hedge against steep declines in equity.

 

Additionally, if you find yourself with a high HOA fee (in the neighborhood of $375/month or higher), getting rid of that monthly cost could translate into more purchasing power – especially if your primary residence is your condo and you’re looking to upsize and buy a single family home! If this is you, this may be the time to act as you transfer your equity to your home purchase and rid yourself of a large monthly condo HOA cost! Again, everyone’s situation is different, and you should consult a tax and legal consultant. 

 

* This article expresses the opinions of the author and is NOT  to be considered as legal, tax or financial advice.*

“Is the market going to crash?” is the most popular question I get these days. The second most popular question: “Is this a good time to buy or sell?”

If you’re reading this, you’re probably wondering the same thing!

While I certainly cannot predict nor guarantee the future, all indicators point to a price correction. Many individuals fear another recession looming and if we follow historical cycles, we’re about due for one. I am NOT an economist and cannot predict a recession; however, I do actively study my market and can tell you that the activity I see is trending towards a price correction in residential real estate.

The pivot began in earnest, this past summer (right around July 2018). The San Diego region has been plagued by a housing shortage for decades and that shortage became more pronounced over the last decade. As we came out of the ashes of the great recession (circa 2010-2011), large investment institutions started to scoop up dirt-cheap properties to fill their portfolios.

Many new-construction projects were tabled or completely scrapped because many potential consumers were NOT able to finance purchases due to the negative credit impacts caused by short sales and foreclosures. Those consumers had a need to rent- hence rents in San Diego have skyrocketed! As the inventory on the resale market dwindled and consumer demand increased, prices began to inflate to near pre-recession levels (fueled heavily by extremely low interest rates). And, as of this year we’ve reached that peak!

So to the naked eye, you’d say, “Oh man, here we go again!” But, I believe this is a different type of correction – I don’t believe we’re experiencing an economic bubble burst (at least not yet), rather we’re experiencing an “Affordability” bubble burst! The truth of the matter is that something had to give! Housing has become too expensive –  plain and simple.

If you take into consideration median incomes compared to housing costs, the only two cities (in California) that are more expensive than San Diego to live in are San Francisco and Silicon Valley (i.e. San Jose). Let that sit for little bit. This means that it is technically less expensive to live in Los Angeles proper, than San Diego! That’s insane! So of course, consumers say, “Enough is enough!” And, the market has stalled! Add National economic trends to the mix, along with the Fed increasing interest rates and BOOM – a perfect recipe for prices to trend downward.

When this price correction trend begins, listings begin to sit a bit longer on the market with absolutely no offers in hand and quite possibly no showings. Then price reductions begin…

Neighbors who’ve been sitting on the fence waiting for the peak to come, place their home on the market to hedge against any further equity loss. Wanting peak pricing, they list high and their house sits endlessly on the market with nothing happening. They reduce the price…no bites…and then they reduce it again…nothing. The price reduction trend goes viral, inventory doubles (almost overnight) and buyers have more leverage to negotiate a deal…

Increasing interest rates however keep buyers on guard because their purchasing power is dwindling. So they write lower offers and stick to their guns… They will even walk away from the offer they made you and bid on the neighbor’s home instead (even though they like that house less). But heck, they’re getting a better deal, and this pattern continues – on and on…

…This is where we currently are in the market – at the beginning stages of an affordability bubble bursting!

Here are some stats on inventory:

The number of homes for sale has increased dramatically in the last quarter.  San Diego is up 26.5% from the same time last year with 8,051 Active properties today.  Last year this time there were 6,537.  According to Infosparks, San Diego sales were down 20.7% in September, rolling three months down 11.4% and for the year down 8.9%.

https://markets.businessinsider.com/news/stocks/redfin-report-for-sale-home-supply-surges-in-hot-west-coast-markets-1027594652

So what should you do? First and foremost – DO NOT PANIC! Do not act out of fear. First assess your situation and determine what your goals are (the “WHY” of things). Once you’ve defined your WHY, team up with a pro to define and create a strategy for the “WHAT” and the “HOW”!

Keep an eye out for my next article where I address what you should do if you’re a condo owner!

*this article expresses the opinions of the author and is NOT to be considered as legal, tax or financial advice. *

So you wanna buy a home…

You know every detail this home needs, from the square footage, to the extra room you want to use as your home office/yoga studio/place of solace from your crazy kids. So with the research done and a budget set it’s time to hit the streets and turn this goal into reality, until, reality hits you in the face. You can’t find the home with your special room, your offers aren’t being accepted, and the original budget you set for yourself isn’t working out. PAUSE. This is where we come in, and when I say we, I mean buyers agents. And guess what? You don’t have to pay us a dime!

Here are 5 reasons why you should use a buyers agent when looking for your new home.

1) Searching during high volume periods

During these periods, (typically spring/fall) there’s an influx of inventory to choose from which can be daunting to many people. An agent will have the most up to-date information of what’s currently on the market and can filter through the properties that don’t fit your criteria.

2) Area expertise

Good agents are experts on the various neighborhoods throughout your county. They can give valuable input that you might have overlooked due to the stresses of your home search. Your agent can give deeper insight by providing comparable properties, pros & cons of each neighborhood etc.

3) Write offers and negotiate with confidence

You can feel more confident when negotiating a fair price for your potential home. This is a skill that a buyers agent has continuously worked on and has mastered. Your agent will help you come up with a strategy and implement that strategy to ensure your success.

4) Workflow/Paperwork

There is a TON of paperwork and due dates during a real estate transaction, and much of it can be confusing. An agent will be able to break everything down for you and make sure you don’t overlook the more important documents. Be confident that you will have a smooth and steady transaction.

5) IT’S FREE

Last but not least, hiring a buyer’s agent is free to you. We can’t tell you how many people don’t know that we get paid from the seller of the property. So with no cost to you, it should be a no brainer to hire a buyer’s agent, to have proper representation and to make sure you are getting the best deal possible.

The answer to the question above is simple and short: YES! It is absolutely ok to use a friend as your real estate agent! But there’s a caveat to this:

Obviously, experience matters tremendously. There’s a lot to be said about knowledge base and expertise (which is really the top reason to hire a realtor, but more on this later in the article). That being said; your agent, irrespective of your relationship with him or her (be it your friend, cousin, brother, sister, former co-worker, etc.) should be vested in the industry. Your agent should not be a hobbyist or someone who just sees the work as a “side hustle”. Someone who does the real estate “side hustle,” typically, lacks the time to really put in the vital work to make a deal happen. Even a rookie full-time agent is better than a “Hobby” agent.

Agents who do this business as a hobby or a side hustle most often lack the knowledge of the important details about transactions, specifically negotiation, that can get you into trouble or be unable to get you out of trouble.  Further, the hobbyist, may lack the sense of urgency and drive to work effectively and efficiently for you. Back in the day (the stone age when nothing was online), you’d hire an agent because agents had the keys to the gates of information. Agents were your “in,” to obtain all data about new listings. NOW, that data is at your disposal 24/7 on that awesome smartphone! The value of the real estate agent lays in negotiation skill and strength, nuanced knowledge, industry experience and the brains and creativity to get you in or out of deals! There’s a slim chance a side hustler can be all of those things for you. Those strengths take full time discipline and practice! “You’re talking about practice?” YES! We are! A full-time agent must grind and hustle every day, taking massive action!

A full-time agent is dedicated and is going to work hard for you – this isn’t a hobby that he or she does only on the weekend – we live, eat and breath real estate! If you were getting brain surgery, would you want a part-time surgeon who does one or two surgeries per year? NO!!! You want the surgeon who does multiple surgeries per day. Now I am not equating being a real estate agent to being a brain surgeon, but it does take some degree of intelligence to do this job well and to sustain it for many years! So, do you want to work with a real estate agent who does one to two transactions per year and maybe works one Saturday every few months as a hobby? Or do you prefer to work with an agent who does multiple transactions per month and does this for a living – full time?  The choice is clear!

Mistake #3 – Writing Too Low Of An Offer

You’re in a peculiar situation by selling contingent. The odds are playing against you, which calls for a certain strategy. This video will help you understand why you shouldn’t place a low ball offer and what strategies to take. 

 

For more insight, reach out to us and we will be happy to answer any more questions you might have.

Mistake #2 – Listing your property too high

This is very common mistake home sellers make. We understand, you want top dollar for your home, but their are strategies we must take in order to get a quality offer.

For more insight, reach out to us and we will be happy to answer any more questions you might have.

Mistake #1 – Waiting to List Your Property

In this Short video series we will be addressing the top 3 biggest mistakes seller’s make when selling their contingent property. 

This is the biggest mistake contingent home sellers make! Being contingent puts you in a peculiar position, and it can be difficult for your offer to be accepted. Here we show you the importance of listing your home before writing any offers.

For more insight, reach out to us and we will be happy to answer any more questions you might have.

Selling a home can prove to be a nerve wracking process for many sellers, especially if you will also be buying a new home simultaneously.

Some of the biggest concerns and questions sellers have are:

  • Will I be Homeless?
  • How do I buy my next home if I haven’t closed on my current one?
  • What if I can’t find a replacement property?

It’s a lot to take in, but don’t worry – if you find yourself in this position – this article will help!

The process of purchasing a new home with the condition of selling your current home/property is known as a “contingent purchase” as the purchase is contingent on you selling a property. The same goes with your sale as you will be selling contingent on purchasing replacement property. There are a lot of moving parts to a contingent sale/purchase as typically the goal is to close the sale and purchase concurrently. There are typically two title companies/Escrows involved, multiple agents and loan officers, multiple inspections, not to mention appraisers on both the down-leg and up-leg transactions (if there’s financing involved).

Are you getting acid re-flux yet? It can be complicated and drive you mad. Often, in an effort to mitigate all of this stress and complexity, sellers inadvertently make crucial mistakes that may actually complicate the transaction which add more fuel and stress. These are the top three most common mistakes made by contingent sellers.

1) Waiting to list your current property until you find your replacement home.

While at face-value this seems to be an ideal and smart strategy, it proves to delay the entire process (especially in hot and competitive markets).

Upfront, sellers feel reluctant entertaining contingent offers because there is a level of uncertainty as to whether your down-leg transaction (aka your current property) can and will actually close. Sellers want to be reassured that you can actually close the purchase. When you send a contingent offer and your property is not even on the market, sellers will interpret your offer in one of two ways: 1, You’re not serious, or 2, this will be a seriously delayed transaction.

Both of these make your offer substantially less appealing and more likely to be rejected. This will delay the process as you will be wasting time making offers which you will probably not be considered at all. Your offers are more appealing if you can demonstrate your current property is listed on the market. Its even more attractive if your current property is under contract (in escrow) and most attractive if it’s in escrow and the buyer of your home has removed all of their contingencies!

2) Pricing Their Listing Too High

Obviously, every seller wants top dollar for their property, and trust me, every listing agent’s chief aim to get the highest and best offer for our sellers.  However, we cannot, ignore the mindset of buyers: every buyer wants a deal! So, when we market and advertise, we need to use psychology to drive buyers to your property. The more foot traffic and eyes you can get on your property, the higher the potential for multiple offers, the more offers we obtain on your property the higher we can drive the price! Makes sense right?

Pricing your home too high for your market or neighborhood will limit the amount of activity at your property diminishing the volume of offers and adding to your market time, again delaying the purchase of your next property. There is one caveat to this principle: if the condition, upgrades or amenities are far superior to those of your neighbors. Pricing your property just right is crucial to not only getting the best offers, but to moving the sale expeditiously!

3) Writing Low-ball Offers

As mentioned above, all buyers want a deal- and a commonly used strategy to get a deal is to write aggressive offers in the hopes of grinding a seller down on price. When you are a contingent buyer, you already have a large psychological barrier to overcome with the seller. They see contingent offers as “Delays” and their biggest doubt and question is – When will this deal close? Adding a low ball price to a contingent offers adds another layer of doubt in the mind of the sellers.

This will lead to a higher potential of your offer being rejected adding to your frustration.  I recommend writing reasonable offers with traditional appraisal and loan contingencies, as well as a due diligence period to inspect and investigate. This will prove to be more attractive to sellers and will increase the likelihood of your contingent offer being considered.

In summary

Expedite the process of purchasing and closing on your new home by putting your current home on the market ASAP and pricing it correctly to obtain the best offer and terms- lock it down in contract. Then write reasonable offers on your replacement property with the adequate contingency period and terms.

Happy Selling!