Sellers And Home Inspections

One of the real estate news info emails I subscribe to talked about doing work on a home prior to putting it on the market. The most important takeaway from that is ..... ASK YOUR REALTOR what is worth doing before listing.

We generally have to suggest a lot of staging. Including decluttering, moving furniture, landscape touches, cleaning, cleaning, and more cleaning.

But, a wise Seller hopefully also knows, and informs their agent, what systems in their home may need some attention. And, their agent will let them know if they should consider doing any repairs or service to those systems prior to going on market.

Some Highlights from the newsletter article:

"If you’re thinking about selling your house, it’s important to know what the home inspection is and what inspectors look for.

As supply is so obviously growing which will allow buyers  to regain some negotiation power, you may find you want to do some select repairs with a good return on investment before listing to get ahead of things a buyer may ask you to fix.

To decide what's worth tackling, you need expert advice. Reach out to a local real estate agent so you know what to prioritize."

It's definitely a touchy situation when we suggest what you should and shouldn't do. It's your call on what you do. But, depending upon the market, it can blow up an escrow if the home inspection finds a lot of items that could have been cleared up prior to listing. Hard choice to make, and, yes, it's hard for us to suggest. 

But, I truly believe the market is changing. And, the more negotiating power a buyer has, the more things a Seller is going to need to correct. Before going on market, or to keep the escrow together and get to the finish line.

Santa Clarita Home Sales Activity - August 8, 2024

Man, it's been soooo hot in SCV!!!

And, on to the home sales info as noted in the title above! As you know, I include all neighborhoods from Acton to the East, Stevenson Ranch to the West, Newhall the South, and Castaic North. We sell them all and outside of SCV of course as well.

Currently we have:

15 in the Coming Soon category / 552 Active for Sale 

331 In Escrow / 241 Sold in the Last 30 Days

But, check this out .... 

Well, if you can read the tiny print that is. If not, it's the price changes on listings in the last 24 hours. 16 did price changes, all but 3 were price adjusted (the latest lingo for a reduction) down. Yes, down.

So, times are a changing for sure. Will they likely move over to a buyers market? Price reductions, increase in inventory (we currently have 2 months of inventory), and now a 1/2 point average home loan interest rate reduction? 

We shall see. I'm expecting a more balanced market for sure as the interest rates go down. Well, we were supposed to see a rate reduction several times this year, finally got one. But, as inventory climbs, and getting home insurance continues to be a California problem, Sellers need to be really aware that just throwing up a sign is not going to necessarily be getting a home sold quickly nor for the price they want.

And, now, with the upcoming implementation of the NAR settlement? Oy, it's going to be a poop show for a bit. And, a lot of unscrupulous agents will mess it up for the good ones. So, stick with us, the SMART and HONEST ones. We'll take care of you, the way the rules read.

California Association of Realtors ~ Sharing the 'Market Minute'

Posted via my California Association of Realtors:

I've put a few things in italics that I think are worthy of italicizing 

July 29, 2024 – The economy expanded at a faster pace than expected in Q2, but the latest growth rate could be the highest we will see in the next few quarters. There are signs in recent months that suggest consumers are increasingly tapped out and could pull back further in coming months. An economic slowdown, however, is not necessarily bad news for the housing market. Mortgage rates, in fact, started this week at six-month lows, as the market has become more convinced that the Fed’s rate cuts will begin in September. Home sales should begin to bounce back and improve more consistently in Q3 and Q4.

US economy surprises with strong growth pace in second quarter: After dropping to the slowest growth pace in Q1 2024 since mid-2022, the U.S. economy bounced back with a stronger-than expected growth rate in the Q2 as consumer spending expanded at a faster clip and business investment continued to rise. Real growth domestic product (GDP) – a measure of economic output – increased at an annualized rate of 2.8% in Q2 2024, well above the 1.4% growth rate recorded in Q1 and exceeded the 2.0% expected by economists. Consumer spending remained the major driving force for the increase, with personal consumption expenditures rising 2.3% on an annualized basis. Business fixed investment also helped fuel the overall economic growth, as intellectual property spending increased 4.5% and equipment surged 11.6%. An increase in households’ income and an improvement in business leaders’ optimism on the economy, in general, were the contributing factors for the solid gain in the overall economic activity.  

June retail sales come in flat but avoid a decline expected by economists: While consumers spending stalled in June, the latest reading was actually better than the 0.3% decline expected by economists. Retail sales last month were unchanged from the prior month but increased 2.3% year-over-year. Softness in gas prices and the auto sector was the primary factor for the decline, but weaknesses in new home sales, building materials and home furnishing also contributed to the drop in retail spending. Retail businesses that are tied to the housing sector have been struggling but could see some improvement in coming months if rates begin to slow more consistently. Recent uptakes in revolving credit, however, suggest that households may have begun to exhaust their borrowing capacity and consumer spending could slow further in the third quarter if the jobs market continues to moderate.

New home sales hit 7-month low: Sales of newly constructed homes in the U.S. unexpected dropped for the second consecutive month in June by 0.6% month-over-month and 7.4% year-over-year to 617,000, according to the U.S. Census Bureau and the Department of Housing and Urban Development. Sales of new single-family homes in June came in well below the consensus expectation of 640,000 and reached the largest level since November 2023. In recent months, new home sales lost their momentum built up earlier this year, as more existing homes became available and mortgage rates failed to come down more consistently in June. On the supply side, the number of for-sale properties climbed again for the third straight month with new home inventory rising to 476,000 units in June, an increase of 0.8% from the prior month and 11.2% from the same month in 2023. New home inventories rose to 9.3 months and continued to apply some downward pressure on new home prices as the median price slipped 0.1% from a year ago to $417,300.

Homes purchased by international buyers dropped to lowest level since 2009: Between April 2023 to March 2024, international buyers bought $42 billion worth of residential properties in the U.S., a decline of 21.2% from the same time from in the prior year, according to a new report from the National Association of Realtors®. The 54,300 existing homes sold to foreign buyers was a dip of 36% from the year before, and it was the lowest level recorded since NAR started tracking in 2009. Higher costs of borrowing, coupled with a strong U.S. dollar, made U.S. homes more expensive to foreign buyers and resulted in a pullback in the desire to home purchases in the states from international buyers. The median existing home sales price of $475,000 recorded in the latest report increased 19.8% from the prior year and was the highest ever recorded by NAR. Canada led all countries of origin in the share of international buyer purchases of total existing homes in the U.S. at 13%, followed by China (11%) and Mexico (11%). Florida remained the top destination for foreign buyers for the 16th consecutive year, accounting for 20% of all international purchases. Texas (13%) came in second and California (11%) came in third.

Profit margins for home sellers mostly unchanged: Returns on U.S. home sales remained steady in Q2 2024, with the profit margin of typical home sales increasing slightly by one percentage point to 55.8% from Q1 2024 but remaining down by one percentage point from Q2 2023, according to ATTOM. While the raw profits in dollar term went up to $130,000, the properties’ return did not move much because median values have been rising consistently at about the same percentage between the time when properties were purchased and the time when properties were sold. Profit margins were up for Q1 2024 to Q2 2024 in 94 of the 160 metropolitan statistical areas (MSA) around the U.S. but were down annually in 100 of those metros.

You may need to read it twice as it's a lot of info. 

But, I felt it was worth sharing in it's entirety.

Check The Equity In Your Home - You May Be Surprised!

Many homeowners looking to sell feel like they’re stuck between a rock and a hard place right now. Today’s mortgage rates are higher than the one they currently have on their home, and that’s making it harder to want to sell and make a move. Maybe you’re in the same boat?

But what if there was a way to offset these higher borrowing costs? There is. And the money you need probably already exists in your current home in the form of equity.

What Is Equity? I actually presume you all know what equity is, but here ya go....

Think of equity as a simple math equation. Freddie Mac explains:

“. . . your home’s equity is the difference between how much your home is worth and how much you owe on your mortgage.”

Your equity grows as you pay down your loan over time and as home prices climb. And thanks to the rapid home price appreciation we saw in recent years, you probably have a whole lot more of it than you realize. We can tell you how much!

The latest from the Census and ATTOM shows more than two out of three homeowners have either completely paid off their mortgages (shown in green in the chart below) or have at least 50% equity (shown in blue in the chart below):

That means the majority of homeowners have a game-changing amount of equity right now. Game-A-Changing indeed!

How Your Equity Can Help Fuel Your Move

After you sell your house, that equity can help you move without worrying as much about today’s mortgage rates. As Danielle Hale, Chief Economist for Realtor.com says:

“A consideration today’s homeowners should review is what their home equity picture looks like. With the typical home listing price up 40% from just five years ago, many home sellers are sitting on a healthy equity cushion. This means they are likely to walk away from a home sale with proceeds that they can use to offset the amount of borrowing needed for their next home purchase.”

To give you some examples, here are a few ways you can use equity to buy your next home that you may not have thought about:

Be an all-cash buyer: If you’ve been living in your current home for a long time, you might have enough equity to buy your next home without having to take out a loan. If that’s the case, you won’t need to borrow any money or worry about mortgage rates. 

Make a larger down payment: That equity can be used toward your next down payment. It might even be enough to let you put a larger amount down, so you won’t have to borrow as much at today’s rates. Win-Win!

The First Step: Determine How Much Equity You Have in Your Home

Want to find out how much equity you have? To do that, you’ll need two things:

The current mortgage balance on your home. The current value of your home.

You can probably find the mortgage balance on your monthly mortgage statement. To understand the current market value of your house, you can pay hundreds of dollars for an appraisal, or you can contact a local real estate agent who will be able to present to you, at no charge, a professional equity assessment report (PEAR). Yes, of course, we can do that!

Once you’ve connected with a trusted local agent and run the numbers, you’re one step closer to making a move you may not have thought was realistic – all thanks to your equity.

Just give us a holler, we'll let you know the amount of equity in your home!

What Buyers Want Right Now ~ July 2024

Because Leslie, Jennifer, and I have our 'head in the game', we know what's selling quickly .... for the most part. And, it's houses that are either extremely desirable ... one of a kind .... or one that is gorgeous and move-in ready. Buyers are paying big bucks, with high interest rates right now. They want the best for paying top dollar.

So, here's a blog post that I copied and pasted from a company I get email campaigns daily. Not gonna kid you though, you'll spot my opinions mingled in their paragraphs! 😄

"If you’re thinking about selling your house, you should know there are buyers who are ready and able to pay today’s high prices. But they want a home that’s move-in ready. A recent press release from Redfin explains:

“Buyers are still out there and they’re willing to pay today’s high prices, but only if the house is in really good shape. They don’t want to spend extra money on paint or new appliances.” Boy oh boy, if I could tell you all the crap we had to do to our first Valencia home!

It makes sense when you think about it. They’re having to pay a lot of money for a house in today’s market. That means they may not be able to easily afford upgrades after they move in. So, if your home is outdated or needs some work, buyers might pass it by or offer a lower price than you were hoping for.

And there are a lot of homes that need upgrades right now. Millions are entering their prime remodel years, meaning they’re between 20 and 39 years old. Maybe yours is one of them. 

If your house falls into this category, it’s important to consider making selective updates to help it appeal to buyers, so it sells faster. But how do you know where to spend your time and money?

Why You Need a Real Estate Agent (raising hand here!)

By working with a local real estate agent to be strategic about the improvements you make, you can be sure you’re making a smart investment. Put simply, not all upgrades are worth the cost. As Bankrate says:

“Before you spend money on costly upgrades, be sure the changes you make will have a high return on investment. It doesn’t make sense to install new granite countertops, for example, if you only stand to break even on them, or even lose money.”

And, as that same Bankrate article goes on to say, that’s where a local real estate agent comes in:

“. . . a good real estate agent will know what local buyers expect and can help you decide what needs doing and what doesn’t.” You know a GREAT local 'family' of agents, right? 😉😉😉

Just in case you forgot who your 'family' is!

Your agent will know what buyers in your area are looking for and what they’re willing to pay for it. By working together, you can avoid spending money on upgrades that won’t pay off. Instead, they’ll fill you in on which changes will make your house more appealing and valuable.

Bottom Line

Selling a house right now requires more than just putting up a For Sale sign. You need to make sure it’s in good condition to attract buyers who are willing to pay today’s high prices.

The way to do that is by making smart improvements that will give you the best return on your investment. Work with a local real estate agent so you know what buyers are looking for and what your house needs before selling."

Smart article. Can you tell where I interjected? 

Thoughts Post Debate

Yeah, we all saw that debate. Yeah, a lot of you probably aren't satisfied with your partys' candidate. So, if you're wondering how the election may affect housing?

Some Highlights:

Are you wondering if the upcoming election will have an impact on the housing market? Here’s what history tells us you need to know if you’re considering a move.​

Data shows home sales slow in November but quickly bounce back and rise the following year. Prices usually keep climbing. And mortgage rates typically come down slightly.

Presidential elections have only a small and temporary impact on the housing market. If you have questions, connect with a real estate agent.

Connect with us now so we can help you navigate when you're ready!

Santa Clarita Home Sales Activity ~ July 5th, 2024

Hope you all had a wonderful Independence Day yesterday! Ours was peaceful, no fireworks at all. Dogs slept like babies!

Market is changing, a wee bit. Home sales have slowed, a wee bit. Prices aren't as inflated, a wee bit. Inventory has grown, yep, you got it, a wee bit.

Including Acton to the East, Stevenson Ranch to the West. Castaic to the North, and Newhall to the South, plus all the little hoods in between....

(Do You Know Where The Community Is From This Picture?)

ACTIVE Homes for Sale ~ 484

COMING Soon ~ 14

UNDER Contract ~ 309

SOLD in the last 30 days ~ 281

So, obviously, if you've been reading my posts for a few years now, inventory is up, but not normal. Closed sales are down, but, near normal. Nuff Said, right?!?

Funny stuff about Real Estate ... some clients will tell you everything that is going on in their world, so we'll understand their actions & reactions. Others, few though, just don't. And, that makes it harder to understand why their actions & reactions are what they are. Realtors are like counselors. If you don't tell us the absolute truth, we can't help you in the best way possible.

Food for Thought.

No matter which one of us you work with, 

definitely let us know what's going on in your world. 

We are your 'Real Estate Home Counselor', 

during one of the biggest events of your life.