Shortage of inventory and low interest rates change the real estate strategy for both buyers and sellers in Ventura and Los Angeles County, as days on the market diminish and the properties are sold within the first week they hit the market with multiple offers or even before they are listed in MLS.
But there are still some properties that sit on the market week after week without any offers or, occasionally, a lowball offer… The perplexed sellers are wondering why they are excluded from the frenzy of activity and multiple offers.
Here are some points if you are planning to put your home on the market for sale and would like to sell it quickly with multiple offers:
- List at competitive price, so the buyers see your property is a good value buy or even a bargain buy. Don’t test the market thinking “I will reduce the price later.”
- Make your property to look its best, repair what needs to be repaired, clean, de-clutter, stage. Your property has to be desirable and attractive to as many buyers as possible. If your property is in great shape and has been taken care of, it will stand out among distressed properties or even remodeled properties that were bought by investors with the purpose of flipping- buy low, remodel, sell high.
- Make your property easy to show and accessible for agents and buyers, take into consideration that there are many vacant properties including REO properties and short sales and those are shown first.
- Big reductions in price are more effective than small reductions in increments, that also sends a message to the buyer – to wait it out.
Most recently I have been discussing and answering this question form my clients:
Q: How is the market in Conejo Valley, Ventura and Los Angeles Counties? What’s happening – there is no inventory, nothing to look at…
A: Yes, the inventory is low, especially in the most popular price range $350K–$450K, actually up to $600K in desirable neighborhoods in Thousand Oaks, Newbury Park, Westlake Village and Agoura Hills. Looks like the market has turned around in the lower price range for Single Family homes in the Conejo Valley area, as well as neighboring areas of Ventura County, Moorpark, Simi Valley, Camarillo…. And why not? Now there are the most favorable conditions in years – combination of reduced home prices in some areas between 30-45% and very low interest rates, besides the banks finally are getting their act together – faster with short sale process approval, as well as modification of loans for qualified underwater properties. Take also into the account all kinds of government sponsored foreclosure avoidance programs HAFA, HAMP, HARP…
I was at the real estate conference in San Diego last week, and the same situation is happening there too – low inventory. For that matter low inventory everywhere in California, even in the previously most depressed markets that Conejo Valley was not a part of, as well as in Las Vegas, Nevada and Arizona (after years of depressed prices and overload of foreclosed and short sale inventory, now shortage of available sellable homes listed for sale, multiple offers) the market overall is flooded with investors with all cash offers or at least with a good chunk of downpayment, leaving little chance for FHA buyers or first time home buyers with low amount of downpayment.
Anyway, if you are serious about buying a home this year you need to be prepared asap – get your finances in order, get preapproval, sign up for my client portal website and call me right away if you see or hear about the property you might be interested in… To be successful and to get the right home or investment property for you, we have to be ready and vigilantly watch the inventory not to miss the great opportunity when it arrives!
Spring is around the corner and the real estate market in Conejo Valley, Ventura and Los Angeles Counties is heating up…
Real estate as any other product is ruled by the law of supply and demand. And the supply of sellable inventory, i.e. well priced homes (at fair market value), in desirable location, and in decent condition is very low and disappears very quickly with multiple offers and over asking price. Many home buyers are experiencing the rush to their frustration that best homes are sold within a couple of days they get on the market or even faster. The pressure is even greater, if you are a first time buyer and planning to finance your home purchase with FHA loan, not saying that most of the condominium complexes in our area are not eligible for FHA financing, because permits of most previously approved FHA condos have expired…. Besides it is hard to compete for the first home buyer with FHA financing and 3.5 % downpayment with the increasing number of investors with considerable money down or more than often all cash offers.
That is why whether you are planning to buy your first home, upsize or downsize, or buy an investment property it is very important to get prepared and put everything in order – your finances, your pre-approval.
Call me today to get a report of market activity in the neighborhoods you are interested in to get informed and make a smart decision when you are ready. (805) 418-2523
Being a first time homebuyer who is qualified for FHA loan with only 3.5% down payment to purchase a home in Homeowners’ association can be quite challenging now. In order for the lender to approve the loan, the property has to be in the list of FHA approved projects or complexes. The challenge is that most of the previously FHA approved complexes in Conejo Valley, Ventura and Los Angeles Counties have expired starting the May of this year.
A number of previously preapproved complexes or neighborhoods expired August 31, 2011, and some are on the brink of expiration date that will happen in the next couple months. Some of the HOAs, pressured by the homeowners, are working hard to collect all the necessary documentation to get the FHA approval again. But it takes time…
In the meantime, if you are a seller with equity and you need to sell fast, think about the option of offering the cash-stranded buyer seller financing, so that the buyer would be qualified for a conventional loan. Consult with your professional real estate agent and financial advisor.
Prudent home buyers can reasonably predict the home they will need in the years to come. One of the musts of successful homeownership is not just to buy a home with the space and number of rooms you need right now, but to buy the home you think will satisfy your needs 5 – 7 years down the road.
Sometimes it’s hard to know what awaits you but you can still plan ahead. You may have just got recently married with zero kids, but you plan to have them in the near future. Or maybe your children are grown-up and you are currently an empty nester right now, and you want to retire – and no longer desiring a two story home to climb the stairs just to get to your bedroom, say, 10 – 15 years down the road from now. Or you think that in a couple-three years you will need at least one bedroom downstairs because your elderly parents might move-in with you from out of state…
Before you buy, you should be in a financial position to buy the home at today’s current prices that meets your future needs, and that requires that you have an idea of your future life and plans.
If you are a buyer in today’s market you know that the majority of listings nowadays are comprised of three groups: REO Properties or Bank Owned; Short Sales; and Standard Sales.
As a savvy Buyer you have to be aware of the things that might turn the sellers off in a standard sale. One of the deadly mistakes of many homebuyers is – talking badly about the property, i.e. many buyers think that if they point out to the seller or to their listing agent how bad the seller’s home is that they intend to buy; how outdated it is; how the other property down the street that had granite counters in the kitchen was sold for nothing; that the property values are going down in the neighborhood and the seller has to take into consideration “future depreciation of 15% that might happen in the next 6 months during the double dip recession…”
This tactics doesn’t work. In fact, in this negative market it turns the sellers off and alienates them. If not most of the sellers are aware of the outdated features of their own property then their agents are. Many buyers use this tactics in the hope to buy the house they may really like a lot, and in their mind they are already planning renovation work… Don’t trash-talk but let your Realtor negotiate the deal in your favor using their experience and negotiating skills.
As a Realtor working with buyers and investors in Conejo Valley and Ventura County, where there is a number of REO (Bank Owned) properties as well as Short Sales. I inevitably come across this question:
“If the bank doesn’t have any other offers, why it then doesn’t take my lowball offer and sell it to me instead of keeping the house in a down market?”
Many buyers who have been waiting patiently for the market to adjust and jump on the opportunity to get a good deal, i.e. a foreclosure or a short sale, are trying to understand the bank reasoning and meanwhile get frustrated after wasting a lot of time making lowball offer after lowball offer on distressed homes.
Banks have a duty to their shareholders and investors to get as much money for the property as possible and as close to the fair market value as possible. That is why before the property is put on the market, BPOs (Broker Price Opinions) and numerous appraisals are done. The property is often initially listed 5 to 15 percent below the market value taking into consideration its condition. Just because it is an REO or a short sale it doesn’t mean that the bank will take the first lowball offer. The banks would rather reduce and adjust the asking price moderately and see what activities and offers it will bring instead of taking an offer that is sometimes 15 to 30 percent below the asking price.
If you are a serious buyer who wants to buy and not just make lowball offers, sit down with your Realtor, review the “comps” and make a smart offer that will mean value to you…
It’s that time of year again, April 15th is just around the corner…
For those homeowners who bought or refinanced their homes in 2010 – don’t forget about another tax deduction – closing costs. Sometimes homeowners are so focused on their mortgage interest and property tax deductions that they forget all about the closing costs. Any origination fees or discount points that were paid to the mortgage lender at closing of escrow are tax deductible on the tax return. Even if the seller paid the closing costs they are still tax deductible for a buyer. Look in your Settlement Statement or your HUD-1, the document that you should have received from your escrow provider after closing escrow. If you cannot find it, call your agent or mortgage broker and they will provide it for you. Consult with your tax professional for all eligible tax deductions for you.
For Distressed Homeowners who had a short sale, loan modifications or foreclosure: Income taxes are not being charged on Cancellation of Debt Income (CODI) Under the Mortgage Debt Forgiveness Relief Act of 2007, on most primary residences through 2012. Please consult your trusted tax professional to get the best tax advice.
If you or people you know are in a distressed situation and are on the brink of a short sale or loan modification please take into consideration that it may take many months for the banks to work out mortgages in all of these ways. If you foresee any of these outcomes in your future, don’t put things off.
These million dollar questions people ask whether they want to buy, sell, invest or just would like to speculate on the value of their homes.
How’s the market? Has the market bottomed out yet? What about double-dip recession and all the “shadow inventory”?
We want to predict or guess what will happen in the nearest future with real estate, especially when the national economy is in turmoil enhanced by political unrest and instability in the worldwide arena. People ask these questions not because they don’t have an opinion, everyone has formed an opinion on what is going on based on what they read and see in the mass media (often confusing and even controversial information), but because they just want to see if your opinion will be in line with theirs…
Here is my view on what will happen in our real estate market, and “our” I mean, Conejo Valley real estate market and surrounding areas of Ventura County and LA County – because let us never forget rule #1 in real estate – REAL ESTATE IS LOCAL – what happens in Riverside County is not necessarily true for your neighborhood in Westlake Village or Thousand Oaks where you live or want to buy.
- The trend of investor purchased and owned properties will continue this year and many of these transactions will be all cash deals.
- This fact will push first time homebuyers out of the market even more because mortgage guidelines are tighter and first time homebuyers cannot compete with all cash investors especially if it is a distressed property and is not FHA approved.
- The rental market will be hot in Conejo Valley and the rents will continue to rise.
- The Median sales price for single family home in Conejo Valley will increase 1-2% in 2011.
These are my predictions. Let me know what you think.