Friday, May 29, 2015

Onward and Forward...With Eyes Wide Open!!

I'm a firm believer of what's meant to be will be. I've been doing this long enough to know that when a client has heartbreak, about not getting a property, it wasn't the best property for them.

I also have personal experience about that very same thing. Prior to becoming a Realtor I lost what I thought was my dream home. Lo and Behold, we found something better.  Again, I thought I lost my dream home a few years ago. Lo and Behold the first buyer couldn't get a loan and we got the house. I've loved every home I've lived in. And, thought I loved every home I lost. But, realized once I found the home I bought, that the lost one wasn't the right one. The one I owned was most definitely the right one for me.

I could keep telling you stories of past clients. Showing 74 homes and going back to the very first one and realizing that was the perfect one. Losing out on a few and realizing that the one they found together was the perfect one for both of them. Missing a home by just a tad over clients max comfort zone in a multiple offer situation.

A new heartbreak, it happens, to a lovely client that I'm working with. I wish the listing agent hadn't shown it as active when it truly wasn't. It could have save my buyer the pain of the loss.

But, it is an eye opener, the loss of the house you think was the right home. Makes one think of what you liked, didn't like, in the home you thought was perfect. 

Helps you keep both eyes open for when the perfect one does come along. 

Wednesday, May 27, 2015

I Anticipated This....And, I See It Happening

A couple of years ago, beginning of 2012, prices took a big jump. As well, rentals were a hot commodity, inventory was still very tight for resale so landlords had a nice pool of people to pick from to fill their properties.

So, I presumed that a few years later we'd have some sales coming on the market that were rentals.

We are! I've seen several properties that were picked up in the last 1/2 dozen years turned into rentals. Now that values have come up, interest rates are still down, those rentals are coming on the market.

Our inventory is almost at 700 in lovely Santa Clarita Valley. Two that I want to show my buyers were purchased in 2011, leased looking like crap. Now, they've been fixed up and are on the market for re-sale.

Several homeowners turned their property into rentals since they were upside down and moved on. Showed one this weekend that now has enough equity to sell and be done acting as a landlord.

I'm thrilled that we're seeing a few more homes coming on the market. But, renters be warned, you may find rental properties harder to come by. Or, you may find your current rental up for sale and have to find another.

Tuesday, May 19, 2015

"The First Two Years Will Be Tight"

I tell this to almost every first time buyer. They are generally scared, excited, anxiety ridden. Usually talking about all the stuff they want to do in their new one once they move in.

Sometimes they won't have a whole lot leftover to do what they want to do. Pretty common for a first timer that is getting in with a low down payment. Or has to do some fancy-footwork to make the loan program even work for a comfortable monthly payment. It can feel like you're bending over backwards to make it happen, but it's the ultimate goal of home ownership that makes people do what they need to do.

Back to the '2 tight years' statement though. If you set yourself up with a conventional, not adjustable, mortgage, then your payment will always be the same. Basically, right?

Over time, your paycheck generally does increase. Some cost of living increases. Less visits to local restaurants since you're loving your new kitchen. Less vacations since the backyard of your new home is so ever inviting. 

You have the same payment, but your income gets higher. The first two years doesn't feel super comfy. Feels a little like working just for a house payment.

Yes, you likely are the first time. But, trust me on this, it will get better. It's worth the fancy footwork, worth the bending over backwards.

Owning your own home has more rewards than the first time home owner truly understands. Until they are cooking in their very own kitchen. Watering their own vegies in their garden. Sweeping the algae off their private pool.

It's a lot of work, a lot of money, but oh so worth it!

Friday, May 15, 2015

When Two Is Always Better Than One

I showed a home last week to prospective buyers. They had seen it at an open house but wanted me, their agent, to view it before they considered writing an offer on it.

My two eyes examined it best as I could. Asked questions of the sellers who happened to be there. Noted, in my head, deficiencies with the property.

Then, out in front of the home, trying very hard not to, I bursted the buyers bubble. I know bursted is not a word, but it works here.

While the floor plan and location are wonderful, there were too many items that were likely going to be costly for a first time home buyer with little funds to correct.

The listing agent and I had discussed my concerns based upon the price point. Had told him if we were going to write it would be 25k under current list price. Youch was going to be the sellers reply, we both agreed.

So today, I let agent know for sure we were not going to write an offer. Buyers had time to chill and think. The more they thought, the more they noticed the defective items in the home. We have since nicknamed it the money pit.

I let listing agent know. He asked me to put in writing why we weren't writing as his seller though my clients loved the house.

And, here is the reason that two is better than one.

While the sellers Realtor had certainly educated the seller, the second opinion from another Realtor will help the sellers agent plead the case as to why the home is not in escrow yet.

Yep, Two is always better than One I say.

Friday, May 8, 2015

You Can Lead A Horse To Water

But, oh no, you sure can't make 'em drink!

Working with clients, sometimes they really think they know more than I do. Maybe they've sold a 1/2 dozen homes. Maybe more, but none of them have ever sold as many homes as I have. Never, ever.

So, while I do always know more than the client, I still have to listen to their concerns. Their thoughts, the opinions. It is their home they are buying or selling after all.

Yet, they hired me for a reason, right? For my expertise, yes? For me being the one that guides them to the water......definitely! But, still, sometimes I just can't make them drink. Well, not the first time frequently.

The first-timers are always so appreciative of everything I teach them, all I open their eyes to, the guidance I provide, the experience I have. They are much more likely to drink the water when I suggest it. They are the thirsty ones.

But the repeat clients, not my repeat clients as those would already have been through this with me before, the ones that have bought or sold a home in the past, those are the tough ones to drink the thirst-quenching water.  They aren't using their prior agent. That actually speaks volumes as I'm writing this down.

Sometimes it takes a loss or two. The, 'we want to do it our way' losses. Those awful losses that they regret the moment they see it coming. The moment they realize the wrong choice was made. The horse was led, but the horse chose not to drink....and that dang horse is still thirsty.

They always come around though. They are practically dehydrated and falling down from the thirst....but they come around. All in their comfort zone time, all when they just can't refuse another drop of water.

Tuesday, May 5, 2015

Why Did The Contingency Removal Time Frame Change?

We had a few changes in our Residential Purchase Agreement in California at the end of last year. One of the things I talked about was the termite inspection.

Today, it's about the Contingency Time Frame change.

Standard had been 17 days for everything. Buyer was to do all of their investigations, confirm value, have loan fully approved. All in that window of time. Frequently we would ask for shorter time period for inspections, but we all know it's the dang loan that takes the longest. No matter how much pestering we do to that buyers lender.

It's going to get harder, but that's not the point of this post.

The full loan approval is not given until every T is crossed and every I is dotted. One of the last things to get cleared can be the appraisal.

Let's say that appraisal doesn't get done until a week or 10 days into escrow. Trust me, it happens. Sometimes a lender is remarkably fast, sometimes it's that longer period. The borrower has to sign their official loan application, disclosures from lender to borrower have to be read and signed. The appraisal gets ordered, the appraiser calls the listing agent, the appointment to view property is scheduled.

Once the appraiser views the property, he/she generally has a couple days to submit their value report. It's a lengthy report, seen plenty of them. Even once the appraiser submits the report it has to go back to the lender before the buyer even hears of the value. Once they finally hear the value they can generally remove that contingency, along with all the other ones....except their final loan contingency.

The reason for the extra 4 days on that final contingency? Because, it's damn difficult to remove appraisal and loan contingency when it's just barely been received.

Quite honestly, listing agents spend several days nagging, threatening, paper-work shoving, to the buyers agent to get Full Contingency Removal.

Removing all buyers contingencies is confirming that buyer is definitely buying and seller can breathe a sigh of relief that the transaction is going to close.

As a listing agent, I'm the nagger. As a buyers agent, I'm the one that confirms those T's & I's for my buyer and still make the lender give the final go ahead. Then I ask buyer "Are You Sure You Want This Home?" one final time!

Friday, May 1, 2015

Pre-Qualifications From Lenders ~ Means Something, Right?

Well, it should. IF, I repeat, IF, your lender has done their due diligence!

Meaning of Due Diligence?  Wikipedia defines it as: A comprehensive appraisal of a business undertaken by a prospective buyer, especially to establish it's assets and liabilities and evaluate it's commercial potential.

In my little world today, I'm talking about a lender not doing their due diligence for their borrower. AKA a buyer writing an offer on one of my listings that really couldn't afford to buy it.

Story: Buyer writes an offer, submits prequal info. A bit sketchy. A difficult loan, low FICO's, low down payment, gift money. Tough, but a can happen loan.

To protect my seller, I ask for one of my preferred lenders to take a look and see what they think about this buyers qualifications.

Basically, ask my lender to work for free, to assist my sellers, to do Due Diligence on the loan probability of this buyer.

Something that the buyers lender supposedly did, right? Hah! Buyers agent and I both felt a bit sketchy about the out-of-area-lender, so there was no animosity about my request.

Lo & Behold, not only had the lender not dug deep into buyers credit, income tax returns, assets, they hadn't even quoted the buyer what their monthly payment would be!!! Buyer about passed out when she heard it.

The type of buyers were absolutely perfect for the property in question. My sellers were more than happy to work with them on their loan program. However, when we determined, by MY lenders Due Diligence, that they could only comfortably afford 75k less.....we weren't so happy. 

Glad that we found out now vs. when we were two weeks into escrow. But damn, why the heck do lenders do this crap to their clients? Why, tell me freaking why???