Monthly Archives: May 2015
The housing market this spring is getting a competitive edge thanks to hot buyer demand and low inventory across Southern California where average sales prices are above average estimated market values of homes sold in April in our metro area. According to Mark Hughes, chief operating officer here at First Team, “Current market activity belies a seller’s market, a lot of activity, less inventory then those looking. We seemed to have reached close to equilibrium nationwide but the combination of a hot destination and cool metro areas [in Southern California] still skew toward sellers for now.”
Sheri Manarrich, a First Team Real Estate agent working in Aliso Viejo, puts it frankly, “There’s no inventory, and there are a million buyers looking for property. A home comes on the market and it’s like a revolving door of buyers and agents.”
There are plenty more tactics to use as well this summer on the SoCal real estate market and they all boil down to three survival strategies – Be ready, Be flexible and Don’t give up!
#1 BE READY
KNOW WHEN TO SEE A BIDDING WAR COMING
Any city with a market time below one month – the time it would theoretically take to sell all houses in the MLS based on new escrows – is expected to see bidding wars, says Steven Thomas of Reports on Housing. Affordable homes around the county under $650,000 also tend to attract bidding wars because first-time home buyers more than ever are trying to make their way onto the market.
One of the biggest worries for a seller is that a buyer’s loan application could get rejected and the way to put those fears to rest is by getting pre-approved for a loan before you even start house hunting. Not pre-qualified or “I used on online calculator and it told me what I can probably get” but a real pre-approval from a trusted lender. Once you’ve put in an offer you can also go through pre-underwriting which takes you through the loan0approval process – pending the home appraisal – and puts you on par with cash buyers.
#2 BE FLEXIBLE
GET RID OF CONTINGENCIES
In a competitive scenario, you’re not going to get the house if your offer is contingent on your own home selling. When there are 10 other offers that are more simple and straightforward, yours doesn’t stand a chance. But don’t worry, with some flexibility of your own you can figure out a rent back strategy to make everyone happy.
But don’t waive the inspection. While getting rid of contingencies makes your offer stand out in a good way,waiving the home inspection is just not smart. Waiving the home inspection sets yourself up for underlying problems that could end up costing thousands down the road. If you win the house by waiving the inspection and it turns out to have thousands of dollars worth plumbing damage, is it really worth it?
USE A TRUSTED LENDER
Sellers like to see a lender they know and trust with a proven track record. It is your mortgage loan but it’s a good idea to keep your seller in mind when you choose it. A trusted lender gives you – and most importantly the seller – assurance that if you get into escrow with them, they can close it out with ease.
#3 DON’T GIVE UP
Don’t get discouraged if you put in an offer and don’t get a home. You might have to make it through a few battles before you win a bidding war and find a home.
WRITE THAT COVER LETTER or AS I CALL IT THE “LOVE LETTER”
Don’t just put in your offer and pray for the best, write a cover letter for the seller and tell them how much you love their home. You can include photos of your family and build a relationship. If you get to know the seller and create a rapport, they will be much more likely to choose your offer.
Working with an agent is another great survival tactic this summer in a real estate bidding war. With an agent by your side, it’s easy to go to battle for what you want. If you’re looking for a real estate agent give me a call I would love to help guide you in achieving your real estate goals. Kevin Allen 714-696-8508 or KevinAllen@FirstTeam.com
With housing on a steady path to recovery, home prices have risen approximately 20 percentin the last three years, according to the Federal Housing Finance Agency (FHFA) and Standard & Poor’s (S&P) Case-Shiller house price indices – and both consumers and industry professionals expect that upward trajectory to continue this year.
The anticipated increase is the result of intersecting economic indicators – macro-level factors painting the big picture that is today’s housing market.
So what’s impacting prices these days?
Wages and Inflation – As much as the economy’s improved, a recent RealtyTrac analysisillustrates disconnect between house price growth and wage growth. Between 2012 and 2014, home prices increased by 17 percent; wages, in contrast, increased 1.3 percent – a 13 to 1 disparity. Furthermore, home prices continue to outpace inflation rates, growing twice as fast in 2014, according to S&P. Read more
We already knew prices had skyrocketed in New York City, San Francisco, and Honolulu. But it turns out plenty of other metro areas are seeing a serious rise in home prices, according to a report on Monday from the National Association of Realtors®. The news might put a little spring in a seller’s step—and a lot more fear in a buyer’s heart.
Prices in many markets have been rising since 2011, but NAR’s latest quarterly reportshows that “the number of areas experiencing double-digit price appreciation doubled compared to last quarter.” In the first quarter of 2015, 51 metro areas saw double-digit increases, up from 24 in the fourth quarter of 2014. Read more
The rising burden of student debt doesn’t explain the weakness in home sales to first-time buyers, so the question arises what is holding this segment back?
Capital Economics says that some of the cyclical factors holding back demand have eased, and despite the conventional wisdom, there is no evidence to suggest that homeownership aspirations amongst young households have diminished in recent years.
“This suggests that factors such as credit scoring and risk aversion amongst lenders may be mostly to blame for the weakness in home sales to first-time buyers,” says chief property economist Ed Stansfield.
Stansfield and his analysts re-examined the issue, and in a client note explain how they took it back to basics. Read more
After years of discussion, La Habra decided on Monday to sell its Civic Center to a housing developer, swapping for commercial land across the street.
City Ventures, which has housing developments throughout Orange County, would buy the Civic Center land for $5.58 million, and build 62 townhomes and nine single family homes on the site now occupied by City Hall, the post office and the arts association, records show.
The city will buy Town Center, commercial buildings across the street, for $3.69 million from City Ventures in the deal. Read more
La Habra police Officer Muris Lucarevic stands out a bit in town.
He’s 6 feet 8 inches tall with a accent that takes a minute to pick up on. It’s Slavic. He moved to the United States from the former Federal Republic of Yugoslavia at age 16.
“The only thing I knew about the U.S. was what I saw in the movies,” Lucarevic, 32, said.
Lucarevic is soft-spoken, friendly. Before deciding to join the police force, he thought he’d teach geography to high school or college students. Read more
La Habra is seeing a number of housing developments coming down the pipeline, all aiming to be done by 2017.
Six projects offer single-family homes to apartments and townhomes. Two in particular highlight how the city’s development could change in years to come. Read more
When the weather heats up this summer in SoCal, we’ll all be desperately trying to keep the temperature down at home. If you don’t have air conditioning, or if you’re trying to save on the cooling bills this presents a particularly sticky situation.
Some rooms are naturally hotter than others based on their location and size but fortunately there are some easy ways to keep the hottest room cool this summer. You don’t have to sweat it out to save money or pay an arm and a leg to keep the air conditioning running all day – there’s plenty of painless tricks that can keep you cool.
Let’s take a look at a few. Read more