Piedmont's kids came out in their finest last Saturday night and my good-looking son, Tristan, was among them. (Yes, a mother can brag just a little; it's in the parenting handbook. He's the handsome one in the vest.) Dressed in formal attire, our children gathered for group photos before breaking off into excited pairs and heading to the dance. From all accounts, the evening was a BIG success (not that teenagers tell you much, but a smile is worth a thousand words).
As parents, we've watched these kids grow up, so it's a kick to see them blossom into smart young adults; perhaps even a bit bittersweet as they'll be graduating from high school soon and navigating travels and adventures beyond our little haven - and our safe homes.
How they pair up and arrange the "dates" is beyond my pay grade, but suffice it to say, there are a lot of moving parts behind the scenes and the "asking" is a bit more complicated than it was in our day. (Evidently, it's got to be Instagram or Snapchat worthy.) Perish the young lad who doesn't at least strive for a little creativity in this department.
"Choosing a date" in Real Estate needn't require social media (although it can), but it's important nonetheless. At the risk of offending your friends or family members who have their real estate licenses and are incredibly well intentioned, let me give you a few reasons why you may want to politely decline their offer to help you purchase - or sell - a home, especially when it's an out-of-area endeavor.
Aside from the fact that not everyone can successfully sell real estate (it only seems that way), the sale or purchase of a home is a highly-specialized, LOCAL venture composed of many micro markets. It may all look the same on paper, but in practice, the transfer of property is extremely nuanced and insular.
Question: If your family friend/agent doesn't live or regularly work in a particular region, he/she isn't going to know:
a.) the inventory
b.) the local protocol
c.) the other agents involved
Answer: ALL OF THE ABOVE!
"Inventory" doesn't just apply to what the MLS (Multiple Listing Service) publishes; it also speaks to those homes that trade "off-market." Surprisingly, even in a Sellers' market, there are a fair number of homes that sell this way. Why? Often it's for reasons of privacy or security, but convenience is a highly compelling factor as well. Frankly, not all Home Sellers want to put themselves through the paces of coming to market. Not only is inviting strangers into your home highly disruptive and work intensive, it's also emotionally taxing. If you can quietly achieve your goal without the pain and pressure of a public sale, then a discreet approach may in fact serve all parties best.
"Local protocol" has everything to do with the etiquette and professionalism agents extend to one another. It also includes a working knowledge of the mandatory disclosure requirements and point-of-sale ordinances that are required on the sale of any property in the state of California. Misstep here and you might find yourself paying for closing costs that aren't typically yours to pay, or omitting some important documents that leave you vulnerable to future lawsuits. Who pays for what, changes from county to county so mistakes in this area can cost your dearly - and unnecessarily.
"Knowing the other agents" within a territory isn't just helpful; it's critical. All things being equal, when it comes to the multiple offer scenario, I am going to encourage my Sellers to accept an offer from an agent I have typically worked with in the past. Since I most definitely cannot control the other parties involved, I'm left with limiting the risk within the transaction, which means (drum roll please . . . ) that I will likely bank on a known entity.
I'm specifically looking to engage with a Realtor that can close the deal with minimal drama and a strong track record. Even if your out-of-area Realtor is a top performer in their neighborhood, they aren't a top performer in mine. And as your friend/relative/bff (fill in the blank), they should do you the favor of referring you out to a local Realtor. A Real Estate transaction is too large a risk to gamble on the unknown. That's the blunt and honest truth. So please, work locally if it's a home you seek and not an exercise in frustration.
(BTW - I don't just recommend this course of action, I live it; having referred three close relatives to local agents in their respective cities last year alone.)
"But my sister (aunt, uncle, father, college roommate . . .) has offered to take less commission. " In other words, your friend will credit you a percentage of the sale if you work with him/her. Ah ha! I hear you.
That's not unlike a few national discount brokerage houses that do the same thing. In essence, they are incentivizing you to work with them. (Sounds good, yes? NO!) I understand the appeal, but you'll pay a heavy price. If at the end of the day, you are never successful at securing the home, then 1% of nothing is still NOTHING. OR if you sell for less than you might have because the out-of-area agent missed the Brokers' Tour dates, didn't place the home in the Ad Review or the correct MLS, overpriced the property, or didn't leverage the interest to your advantage, you will have lost far more than the 1% you hoped to pocket in exchange.(Hmmmm, that's food for thought.)
At the risk of playing the devil's advocate, may I politely encourage you to think long and hard about what best serves your intended goals? In a market where homes are usually sold within 14 days and typically involving multiple offers, you can't afford to lose a minute - or an opportunity - because of a misplaced obligation, no matter how well intentioned.
"We lost five houses last year working with our agent from the peninsula," a discouraged buyer lamented.
Yes, I've heard that before and no, it doesn't surprise me at all. Worse yet, the market is shaping up to be MORE competitive this year than it was last, so while you were being polite and loyal to your out-of-area agent, the house you could have had last year for "X," will now, undoubtedly cost you "Y." In an UP marketplace, time truly is money.
Luckily, this hurdle is easily correctable. Ask your out-of-area agent to refer you, or better yet, align with a local agent who is happy to issue a referral agreement to your previous agent in exchange for your business. Yes, your 1% may get cut out of the equation, but better that than going into another competitive season two strikes down. Good agents understand the value of the referral and want you to have a successful result. In short, GREAT agents put your interests ahead of their own - and that's as it should be. Are you ready to date?
How can I help you?
(P.S. -You can follow my ongoing renovation on my new Blog: Renovation Riptide. I invite your comments and stories. )
On Wednesday evening, I was invited to a book launch and a seminar on finding the "sweet spot," given by local author Christine Carter, PH.D., sociologist and happiness expert.
Now there's a woman with an admirable gift; counseling others on achieving a "happy" life. Truly, I can't imagine a better gig. And the best part is that "happiness" is best achieved by being outwardly directed and of service to others.
How great is that? (Just like our mothers taught us.)
In other words, when we strive for meaning and purpose, instead of happiness, we're more likely to achieve real joy. (New shoes or a great hand bag can make you happy momentarily, but it's not going to last.) In the end, our value lies in what we contribute to others. (Of course it does.)
Isn't it appropriate then that I not only love my job, but that I truly believe my work helps others move closer to their dreams? When it comes to the world of Real Estate, I'm combining both my passion and my strengths, which means (according to Christine) that I am not only working within my "sweet spot," but actually EXPANDING it. (SWEET!)
Not surprisingly, finding "happiness" is much easier said than done. Not only is "happiness" a subjective objective, but it's a moving target as well. Moreover, in a run-away marketplace, there's bound to be expectations that aren't easily met. And in my experience it's those pesky "expectations" that often lead us into deep and troubling waters where we can be anything BUT happy.
So let's talk about expectations that are, in fact, realistic - and those that are not . . .
It's fair to expect your agent to be knowledgeable, diligent, understanding, prepared, willing, and engaged.
It's fair to expect that your house will be "market-ready" and fully exposed to the marketplace via the MLS, mailings, newspapers, and Internet advertising.
It's fair to expect your agent will refer you to carpenters, inspectors, gardeners, window washers, handymen, title officers, etc., etc., etc. and to coordinate these vendors. "Full" service is just that.
It's fair to expect your agent to consult with you on your home (within reason). I'm NOT trained to give anyone an opinion on the health of a home's foundation (nor would you want me to) but I am happy to talk to you about the color on your walls, the plantings in your garden, and the curb appeal out front (or lack thereof).
It's fair to expect your agent to educate you as to the current marketplace, apprising you of any changes as they occur. Keep in mind, this may include telling you that your house isn't worth as much as you may have thought, OR that you'll need to be more aggressive with your offers in order to get a house. Having the difficult conversations is part of our job description as well.
It's fair to expect your agent to keep open and ongoing communication with you throughout the transaction and to work with a fair amount of transparency. (I always create a calendar and a road map for my clients.) You don't need to know every little detail obviously, but selling a house isn't a covert operation. You shouldn't feel "lost in translation."
It's fair to expect returned phone calls and prompt replies, but not to expect that Realtors are on call 24/7. "Balance" at both work and home make us more productive in our professions, not less.
It's fair to ask for an explanation of the contract and associated documents/disclosures. (You really should know what you are signing before you sign it.) Granted. there's a TON of paperwork to get through and much of it is boiler-plated, but do take the time you need to feel comfortable with what you are signing.
It's fair to tell your agent the truth about what you need and what you want in the moment. Under the BEST of circumstances, selling a home is a highly stressful situation. Add divorce, death, job transfer, marriage, child birth, and the unknown, and the stress is exponentially greater. Speak up; we invite your contributions and we WANT to help.
It's fair to expect your agent to advocate on your behalf. Let's be blunt; the Internet has transferred the responsibility of the search from our hands to yours, but negotiating, advocating, and guiding you through the escrow process remains the function of your REALTOR. Frankly, it's where the rubber meets the road. Good agents earn their keep and bring much needed clarity to the process.
On the flip side . . .
It's not fair to expect your agent to read your mind. Although we are known to prognosticate, we really aren't fortune tellers, nor can we see the future. In many instances, we're often working on gut instinct and past experience.
It's not fair to expect an unrealistic outcome on either the buy or sell side. Clearly, agents don't control the "market value" of a home; no matter the economic conditions, a willing and able Buyer sets the selling price. We neither command what a house will ultimately fetch, nor how many offers will be in play (although we'd love that kind of power).
It's not fair to expect your agent to act as your housekeeper, gardener, stager, window washer, dog walker, moving man, handyman or maintenance woman. Although admittedly, I DO pack a broom and a dustpan and have been known to vacuum at my listings. (That's not the norm BTW, but good agents, like good Boy Scouts, are always 'prepared.')
It's not fair to blame your agent for bad weather. We don't control the rain (although I wish we did). Rain is unfortunate but once the advertisement is in place, it's tough to change course. That's what booties are for.
It's not fair to blame your Agent for the failings or defects of a house. ALL homes (new or old) require ongoing maintenance and updating and some of these repairs are downright expensive. There is definitely a cost to home ownership beyond the purchase AND every house is bound to hold some unwelcome surprises, no matter how diligently we inspect. If the risk isn't for you, rent.
It's not fair to expect your agent to act as your lawyer, contractor, roofer, engineer or home inspector. Yes, I can tell you that I feel settlement in the floors, but beyond that, my license limits me to advising you about the transfer of REAL ESTATE alone. In fact, we could both run into real trouble if I took on those roles and overstepped my boundaries, or my knowledge.
It's not fair to expect your agent to dictate the behavior of other parties involved in the transaction. We can lead by example and negotiate with integrity, but we don't control the poor behavior of other folk. The best course of action in such cases is to always take the high road. (Sorry, but it is. Don't get down in the mud with those who don't play fair.)
In the end, if we are well prepared and set realistic expectations, there will be little to be upset about once the unexpected begins to appear (and it always does). While we can't necessarily plan for everything, we certainly can control our intentions and our corresponding actions so that they better align with the intended goals.
Remember, you're not doing this alone; I'm here to help and that's bound to make us both much "happier." Let's find the "sweet spot" together!
How can I help you?
(P.S. -You can follow my ongoing renovation on my new Blog: Renovation Riptide. I invite your comments and stories. )
I wandered the aisles at the supermarket last evening trying to come up with a last- minute dinner plan and finally stopped at the meat counter looking for inspiration. (Admittedly, "last-minute plans" typically aren't the best way to proceed.)
"Can I help you?" the butcher politely asked.
"Yes," I smartly replied. "You can come home with me and cook dinner!"
Left to my own devices, I would rather have popcorn, so I'm truly in awe of my friends who cannot only cook with ease, but can whip up a sauce and literally throw dinner together with little more than a chicken breast and whatever is available in their well-stocked pantries. (As if!) For me,"DINNER" is a four-letter word.
Still, I can't exactly argue with any meal that provides my family the opportunity to reconnect,if only for a few moments each day. Every parent can attest to the fact that as our children age, they are home less often, lured away by friends, sports, practices, part-time jobs, and school activities (usually in that order).
So while I don't entirely disagree with the concept of "dinner" per se, I'll be the first to confess that I'd rather do without. In fact, when it comes to dinners, I find the whole process nearly overwhelming. (What's so wrong with waffles for dinner?)
Unfortunately "overwhelmed" is the word most often used by many home Buyers facing the gauntlet of purchasing in today's current climate. Not only will Buyers be competing in what is certainly the most aggressive marketplace in more than a decade, they'll very likely need to establish credit as well. (And you thought finding the house was challenging.)
While lending institutions have certainly rebounded from the startling 2008 meltdown, the lending requirements post 2008 have remained incredibly restrictive at best, leaving many to wonder, "where do I begin?" (At the beginning, of course!)
So here's the skinny . . .
There's money to be had and at historically low-interest rates to be sure, but unless your credit history is well established, your FICO scores are above reproach, you have ample assets for the down payment, AND you can trace your income to the penny, you may find that borrowing the necessary funds is a bit of an uphill battle - especially if it's JUMBO dollars you seek. ("Jumbo loans" are defined as loans greater than $625,500.) And by "an uphill battle," what I really mean is: "a pain in the you know what!"
That isn't to say that banks don't want your business (they do) and to be fair, most loan officers are exceptionally good at their trade, but when seeking a loan, DO be prepared to turn over your entire financial history - and your first born as well. (You've probably got one you wouldn't mind trading anyway.) All kidding aside, with the exception of a root canal, there may be nothing quite as probing as applying for a loan - OR more painful.
"Julie, we'll need your and Cliff's last two year's tax returns," my loan officer requested. "A W-2 from your employers, a Profit & Loss Statement from each of you, your retirement accounts, your financial portfolio, signed affidavits, these 15 forms filled out right away, and oh, can you please explain that $30 mystery deposit from six months ago? (Uh, no I can't.)
Holy smokes, Batman!
My best advice? Select your lender as carefully as you choose your Realtor (I have some excellent recommendations) and then follow their orders and supply the documents they require in order to supply the necessary funds. (Remember, they are actually on your side.) Nobody wants to make your life miserable, but make no mistake, you'll EARN every dollar you request. Once more, without a pre-approval letter you won't even be in the game should you find the dream home you seek. In this market, you absolutely need a reliable lender, so don't put this off.
But why make it so tough?
That's an excellent question. The reality is that lenders have strict guidelines they must adhere to - especially in the wake of 2008 - and to be fair, all this paperwork and inconvenience IS having the intended effect of protecting the final investment . . . the equity in your home. Thus, those who DO qualify are far more likely to actually pay back their loans, and that (coupled with plethora of "ALL CASH" purchases) means we are far less likely to see the flood of foreclosures and dramatic value drops the market experienced not so very long ago. (Oh, that makes sense and 'cents.'.)
Moreover, because jumbo loans aren't government backed (as are conventional loans) each lender may have a different set of criteria to be met before final approval is granted. In other words, acquiring a jumbo loan can be bit of a moving target.
To further complicate the equation, where one institution will easily grant an exception, another will turn you down flat. (Ouch.) Finally, because underwriters are actual human beings (at least that's what they tell us) the underwriters themselves will ultimately judge the credit worthiness of an applicant, meaning that even within the same institution, each individual underwriter may have their own unique set of rules.
Oh brother! (I couldn't agree more.)
Like all things, the list of requests are best met by putting one foot in front of the other. (Not by exasperation; I tried that and it doesn't work, believe me.) With rates hovering between 3.625 and 4.250, it's well worth your time and energy to dig through your files. With pre-approval in hand, you'll be ready to attack the market with vigor AND you'll be in a position to win.
As a bonus, you may be so busy rifling through last year's bank statements, you'll have to order in pizza. (Finally, the silver lining!)
How can I help you?
(P.S. -You can follow my ongoing renovation on my new Blog: Renovation Riptide. I invite your comments and stories. )
"Happy new Year," I said to Liz. Liz and her crew have been cleaning our homes for several years and she's like family to us. I can't begin to express my gratitude for the work she provides and the dollars she saves us in marriage counseling.
"What will you be doing tonight to celebrate?" I asked as we stripped the sheets.
"My entire familia comes together to cook tamales," Liz replied. "We make an entire production out of it. This evening we'll prepare three kinds of fillings (yum) and tomorrow, soak the husks, create the masa dough, and roll them. It takes an assembly line to do it, but we all go home with LOTS of tamales!"
I should preface this story by admitting that years ago, upon reading a Sunset Magazine article about a family in Santa Fe that spent their holidays in exactly the same fashion - cooking tamales and THEN delivering them to their friends - I felt truly inspired and ran off to the specialty store in The Mission to buy the ingredients and whip up a batch. Not that I'm a great cook mind you, but I can comfortably find my way through a recipe when inspired . . .
Cut to two days later, a BIG mess in the kitchen, and a sad bunch of anemic tamales and that illusion went right into the garbage can - along with my inedible creations. (I'll stick to chocolate chip cookies from here on out.)
Maybe it's a genetic thing; maybe it's a Latin thing; maybe it's a family thing; whatever the missing component, my foray into tamales was short-lived. Given the tremendous work involved, I've decided it's much easier (and smarter) to buy tamales from those that know what they are doing, then to blunder through at great time and expense, only to end up with less than stellar results.
So you probably know where I'm going with this . . .
There's a BIG divide between what we think we know and what we actually know, OR put another way, between experience and inexperience. Perhaps because real estate is so often a topic of conversation, it's become one of those jobs that seems easily accomplished. (It isn't.) Just plant a sign our front and wait for the offers to role in - right? Not exactly.
Several weeks ago I wrote about a FSBO (For Sale by Owner) that had essentially made a "mess in the kitchen." The owner had a Broker's license but clearly didn't know the local protocol with respect to point of sale ordinances, hadn't prepped the house properly, didn't know the correct day for the Brokers' Tour, wasn't connected to a Realtor network, hadn't addressed the "red flags" within the pest report, and most fatally, had overpriced the property. In a nutshell (or a corn husk, just to keep the story consistent), he'd done absolutely everything wrong.
As a result, in what has been the MOST dynamic marketplace we have seen in nearly a decade, his house languished on the market for many weeks before going into contract, but not until he had reduced the price and addressed some of the outstanding issues first. I'm certain, that's not the result Mr. Seller has anticipated. In this instance, the money the FSBO Seller saved by overseeing the sale himself, was absolutely lost in translation.
In practice, a good Realtor is: part salesman, part therapist, part cheerleader, part juggler, part magician, part problem-solver, part negotiator, part advocate, part director, part producer, and part detective. (Realtors are NOT tax advisors or legal consultants as our license precludes us from giving advise in those areas, so please speak to your CPA or attorney as needed.) Realtors not only know the market in which you live, they often shape it.
So if a move is in your near future, or sits much further out, please reach out to a professional and include him or her in the planning as part of the process. (I'm just a phone call away.) I'm available to oversee whatever transition you seek and most importantly, to help you achieve your goals. If you plan to move after the school year ends in June, it's really NOT to soon to speak to a Realtor now. In fact, you should already be getting on their schedule and moving into action.
Finally, a word about the concept of an "assembly line," which Liz offered as a key to her success. Here at The GRUBB Co. we also have a group of highly-skilled and dedicated professionals that work diligently behind the scenes. From photographers, to escrow coordinators, to assistants, to marketing specialists, to on-site Brokers and decision makers, the creative team is part and parcel of your success. When you work with one of us, you gain the collective wisdom and experience of us all. Hey, it's a new year and I'm ready to get back into the kitchen and start cooking (metaphorically speaking that is; tamales will definitely NOT be on the menu.). In short, I'll work with my strengths and focus on what I know, AND "what I know" today is that the market is incredibly exuberant, buyer demand is high, supply is underserved, interest rates are historically low, job growth is on the rise, consumer confidence is UP, gas prices are down, and we have every reason to believe that 2015 will deliver as well as or better than 2014. For Sellers, it doesn't get much better than that so don't miss this golden opportunity.
How can I help you?
(P.S. - That wasn't rain a few weeks back, those were my tears. An engineering snafu and a holiday break added up to a bit of a setback. (What else is new?) You can follow my ongoing renovation on my new Blog: Renovation Riptide. I invite your comments and stories. )
Can you feel the hustle and bustle? No, not with Real Estate (Real Estate is finally taking an overdue break) but with preparations for the holidays? Whatever celebration you honor, I suspect that most of you are busy shopping and wrapping presents, baking cookies, delivering goodies (yum), decorating, and donating to your favorite charities.
"Tis the season . . ."
While your kids will be tearing into packages come Christmas morning, I'll hopefully be skiing down the slopes in Steamboat Springs, Colorado, with mine. (Heaven.) Hey, I may have swapped Christmas for Chanukah when I joined Cliff's family 25 years ago, but there are some real advantages to the Jewish traditions and the simplicity of those eight days of lights. Let's just say that a menorah is certainly more portable than a tree, and who doesn't love a good latke? (I guess if you were wandering the desert for 40 years, you'd want to keep the load light too.)
It'll be my first time in Steamboat and I'm looking forward to getting away for a few days. So Merry Christmas, Happy Chanukah and Kwanza. Until we meet again in the New Year, I'm wishing you all a season of peace and joy.
Speaking of the New Year and how it pertains to Real Estate . . .
What do we expect 2015 to bring? Where are we headed?
And how did the market perform in 2014?
(I'm glad you asked.)
It just so happens that on Tuesday I attended the annual holiday luncheon hosted by First Republic Bank at the St. Francis Yacht Club in San Francisco. (Thank you Chad Rego for the invite.) First Republic always does an amazing job of laying out the economic landscape - both locally and globally - and then providing a forecast for the coming months and this year was no different. Alan Zafran, Senior Managing Director and Portfolio Manager of First Republic Investment Management, passed along his wisdom and experience that's well worth sharing. (It doesn't come with a bow, but it's a gift nonetheless.) I hope you find it as informative as I did.
In a nutshell, here's what Alan Zafron had to say:
In short, the East Bay is a great value by comparison to San Francisco, South Bay, and North Bay Area markets, where Palo Alto, Hillsborough, Los Altos and Marin all come in at, or near the TOP of the list as the most expensive communities in which to live.
Make no mistake, Oakland, Piedmont, and Berkeley saw great demand as well so while you won't necessarily find bargains here, you will absolutely find OPPORTUNITY. (Folks, that's the sound of knocking at your door.) With interest rates at all-time historical lows, no one expects much to change in 2015, although at some point, the market must hit its ceiling, according to our esteemed speaker.
Have we hit the top yet?
No one knows, but Mr. Zarnoff felt we were certainly getting near the peak. In a baseball analogy of a nine-inning game (and who doesn't love a good baseball analogy?) he surmised that we were in the seventh inning, suggesting that there is still time to buy before housing prices level off, OR begin to correct. (Keep in mind that ALL markets are cyclical, as evidenced by the 2008 crisis.)
As for Piedmont, in 2014? 142 properties traded on the MLS (Multiple Listing Service) with the top selling price coming in at $5,450,000 and the lowest price recorded at $810,000. The average selling price was approximately $1,867,000 and the median was $1,715,000. Again, with a booming economy and unemployment at its lowest rate in years, Mr. Zafron predicts NO decrease in values in the new year - barring any unforeseen circumstances, of course.
To give you some context, 2013's selling price in Piedmont averaged approximately: $1,614,000 with the lowest recorded price at $665,000 and the highest, at $4,900,000. (Days on market averaged 22 in both calendar years, but is always skewed by those few houses that languish; 22 days doesn't accurately represent the speed of the market by any means). Only 117 homes traded on the MLS in 2013 compared to 149 homes in 2014. Evidently, Sellers took advantage of a red-hot market and were rewarded in kind. Were you among them? (Happily, I was.)
Thus inventory was up, but so too was Buyer demand. In nearly every case, multiple offers were presented, driving the sales price to 25-35% above the list price and sometimes, well, WELL beyond. Whether this is welcome news or not, it's going to be the same for the foreseeable future until housing stock catches up with those willing and able to buy.
So that's the gist of the marketplace: past, present and future . . . 2014 came in with a bang and only got better as the year progressed. As for 2015, whatever you decide to do with your own home sale, home search, home purchase, or home project, just know that I am here to be a resource, to provide guidance, and to bring clarity. Your continued support and referrals made my year and I don't take them lightly. Thank you very much and Happy New Year!
How can I help you?
(P.S. - You can follow my own renovation on my new blog: Renovation Riptide. I invite your comments and stories. )
Based on my son's ACT scores and his excellent high school GPA, I'm fairly certain Tristan is bound for a good college next fall,
BUT there are those moments, when I have just the slightest doubt . . . Yesterday I received a call from him during the storm asking where his rain coat might be. "Um, did you try the coat closet in the front hall?" I asked, sure of the answer.
"Oh, right, I'll look there." (Good thing he's handsome too.) ??????????????
Maybe it's just me, but shouldn't the coat closet have been the first place he looked - rather than the last? It's not as if there are mounds of clothes all over the house and piles to sort through. In fact, I'm a gal who prides herself on having everything in its place. (I like the illusion of control even when I know that it's truly an illusion.) At the risk of sounding like a "mom," (eye roll please) it just seems that Tristan should start with the obvious choice and then branch out from there. Ditto for the text books, the backpack, the permission slips, the baseball bat, the mitt, the uniform, etc, etc,. etc. (you know the drill). Maybe it's a "Y" chromosome thing; his dad has the same issue so I suppose my son comes by this trait honestly. (Evidently, the apple didn't fall far from the tree.)
Perhaps the obvious isn't so obvious after all. But here are some things that should be obvious to every Buyer and Seller before entering the marketplace, and if they aren't, let me count the ways:
1) Market value is based on supply and demand - NOT on what an agent, an appraiser, or GodZillow says. The "Zestimate," although a catchy title, is frankly, the bane of every Realtor's existence. Consider it one tool only, and not necessarily an accurate measure of the market value of your home, or of your future home.
2) Market value changes over time, which means values may go UP or DOWN, depending on the economics and stability of the surrounding marketplace and of the prevailing interest rates. (It's important to note that a 1% change in the interest rates typically translates to a 10% decrease in spending power for a Buyer.) Don't worry about "timing" the marketplace (I'm not sure it's even possible) but DO understand the volatility of the marketplace.
3) Real estate markets are highly localized. What's true in one area, isn't necessarily true in another, which is why you should always work with a local agent instead of a friend or relative who is out-of-area, no matter how well-intentioned. Choose an agent who knows the lay of the land, has relationships with the other agents in the area, and has closed many transactions successfully in the neighborhood you seek. That high school friend you just reconnected with on Facebook means well, but doesn't necessarily serve you well. Those are two entirely different things. Whom you choose can make or break your sale so work locally!
4) A local lender is almost as important as a local Realtor, especially in a highly competitive marketplace. In competition, the experience and reputation of the lender are often the tipping points between your offer and another. Quicken online? No doubt they are great, but save this impersonal avenue for the refi down the road, when it won't matter who the lender is or how quickly they can perform.
5) The recent sale of the house down the street SETS your comparison - even when your house is "much more special." (Let's just assume for argument's sake that it is.) Granted, there are exceptions to this rule, but they are few and far between. It's unrealistic to expect a million dollars more than your neighbor's sale unless your home has outstanding characteristics that truly set it apart. Conversely, if you have less to spend than the market commands, geographically expand your search or reset your expectations to better align with market realities. In other words, work the odds instead of the long shots.
6) Agents can't guarantee an outcome or promise a result (although we dearly wish we could). Wouldn't that save a tremendous amount of anxiety, uncertainty, and time for everyone involved? (Yes, it would.) DO be suspicious of Realtors that try to "buy" your listing by giving you a highly inflated number or by telling you they already have your buyer in their pocket. (They usually don't and duel agency rarely favors you even if they did.) He/she will eventually work that number down when the market fails to deliver, but you will have lost valuable time in the process.
7) Painting and staging aren't merely suggestions; they are now standard practice. Unless your house is magazine worthy (instead of piled high with magazines!) the dollars spent to bring your home to market "camera ready," typically return high dividends. (93% of ALL buyers begin their search online.) Moreover, unstaged listings pale by comparison to their staged counterparts, and your final sales result will be markedly different. (Staging isn't necessarily the norm for major "fixers" that really need more than just cosmetic face-lifts. In this case, you may actually be misleading the consumer by covering up the faults and you'll undoubtedly be throwing good money after bad. Inspect only and disclose thoroughly.)
8) Disclosures and inspections aren't designed to frustrate you; their function is to protect you. The more you disclose and correct upfront, the fewer hurdles you will have on the back end. No one likes renegotiations during the escrow process - especially the Sellers. Disclose, disclose, DISCLOSE! (Did I say disclose?)
9) Time is of the essence! You don't want a protracted sale as in: "Let's just throw it out there and test the market to see if we get our price." IF your agent has done his/her job correctly, has prepared the property appropriately, has thoroughly exposed the listing to the Broker community and the general public, then your house should sell within a few swift weeks (not months). Homes that linger, unfortunately chase the market down, thus, the relationship with your agent should be short and memorable for the BEST results. The longer a house sits on the marketplace, the less successful the outcome.
10) Good preparation - on both the buy side and the sell side - is the key to being able to move swiftly and jump on any opportunity. Last year, I began to prepare my own home for sale at Christmas in spite of my husband's mild objections; thus when the spring market bloomed earlier than usual, Cliff and I were fully primed to take advantage of it - and did. On the flip side, the Buyer who has ALL of their documentation to their lender and has a mortgage guarantee in place, can be first in line when the right home comes along, and to quote Martha Stewart: "That's a very good thing."
So now you're in the know. If these items weren't obvious before, they certainly should be now. How can I help you?
(Hey, I'd love to hear your "obvious" insights. Pass them along and I'll share your comments in a follow-up column. )
Thanksgiving is perhaps my favorite holiday, if for no other reason than it's still relatively unspoiled by commercialism, religion or politics. Irrespective of one's faith or beliefs, families young and old, will gather around a table to carve a turkey, hold hands, and EAT! For one day, we will put aside our skepticism, collectively give thanks, and share a common objective on a national level, which in and of itself is nothing short of miraculous. Gobble, gobble, gobble!
Save for a fantastic meal and a lavish table, there's little else that's required to come together and entice one's kids to return home. (A BIG flat screen TV probably doesn't hurt either.) "Gather ye rosebuds while ye may." The years really do speed by all too swiftly. So while there's a good deal of cooking and cleaning that goes along with the holiday, there's no frantic gift buying. (A fact I'm truly grateful for.)
Since this is the first time Cliff and I will be seeing our son, Case, since he graduated from the University of Arizona last June and moved to Austin, Texas, I couldn't be more excited for the break. As his mom, I applaud his hard-won independence, but what's wrong with a little apartment in Oakland and a job in the Bay Area, I ask?
To which Case replies, "Mom, I need to strike out on my own, but can you pay for my airplane ticket?" (Gladly, as long as you come home once in awhile.)
As the new house (and by "new," I mean very old and decrepit house) is decidedly under construction, I won't be tending to the bird this year and cooking for 30 guests, as is my usual fare. In fact, I have booked a lovely VRBO in Santa Cruz for a little R & R and some football on the beach, so the day will be a much more intimate affair and dinner will take place at the Shadowbrook Restaurant along the creek. (I'm really taking this mini vacation to heart.) I'm only too happy to have someone else oversee the cooking and the cleaning for a change.
I'll also be taking next week off from writing The Perspective, so it seems appropriate to give thanks now. (Thank you.) It's been a year of change for my family on nearly every level, from the sale of our own Piedmont home, to the purchase of the Calmar "fixer," to our son's college graduation, to an impromptu relocation, to my mother-in-law's move into assisted living, just to name a few . . . and you have been there every step of the way with your words of encouragement, your kindness, your support and your presence.
How do I thank you enough? Your friendship and faith are so deeply appreciated.
And while juggling life on "life's terms," I was also riding the crest of my industry's biggest year in nearly a decade. To no one's surprise, The GRUBB Co. enjoyed more than its share of success and I gratefully, went along for the ride. Personally, it was a banner year (again, thank you) as the economic recovery coincided perfectly with a decade of diligence and experience on my part.
In short, 2014 has been an exuberant year for Real Estate and I suspect 2015 will prove equally as fruitful for those of you buying, selling - or buying AND selling - in the coming months as well. This projection is positive news and comes by way of the National Association of Realtors and every other economic guru with a horse in the race. As things currently sit, there's no reason to expect anything but continued growth. Give thanks.
However, with buyer demand still outflanking good, available inventory, Sellers retain a distinct advantage for the foreseeable future, which is great to hear if you are a Seller, but tougher news if you're on the buy side of this equation.
What can I say? Let's talk turkey and (at the risk of mixing fowl metaphors) get your ducks in a row so that you are in a position to compete in a very meaningful way come the spring. You will need to.
BTW - if a move is in your future, it's NOT too early to reach out to your Realtor NOW to set a calendar and begin preparations. Sellers can begin to inspect, purge, pack, clean and paint their homes while Buyers should be getting their financial house in order and meeting with a local lender. As an aside, if you have a college-age child returning home for the holidays, this is an opportune time to have him/her go through their rooms and discard, donate and deconstruct. Good-bye Boy Band posters, soccer trophies and the like . . .
For the sake of parity, there's a good deal of work to be done on both sides of the transaction so that come next spring, you are poised to be "in the right place at the right time," and that's where I come in. (Please feel free to refer me to your friends and family.) I have years of experience guiding both Buyers and Sellers through the process. Moreover, there are few things as professionally gratifying as seeing a family happily ensconced in their new home. What can I say? I'm a girl who believes in the dream.
But let's all take next week off to enjoy family time with one another, to gather in circles large and small, to watch marathon football matches, to take a walk with our dogs, to eat more than we should, and to experience grace in all of its fine forms. Ain't life grand?
(P.S. - You can follow my renovation escapades, missteps and misfortunes at www.renovationriptide.com. It's full of "oh wow" photos and "OMG" moments. Or put another way: What can you do when you live in a zoo? It's going to be great when it's completed. At least that's what I keep telling myself!)
My dog, Buck, has perfected the art of being in the "right place at the right time." He knows that if he patrols the kitchen while I'm preparing dinner, chances are that something delicious is bound to slip off the counter, the cutting board or the stove and PLOP squarely onto the floor. (Okay, given that he's a dog, it needn't actually qualify as "delicious;" anything semi-edible will do.)
When it does, Buck pounces. On nights when he is really lucky, I'll let Buck lick the pan. (Just for the record, the dish hits the dishwasher immediately thereafter.) Life is admittedly, much easier (and far more straightforward) if you're a well-loved dog.
But if you're a buyer or a Seller, how do you know when it's the "right time" to buy or sell?
The short answer is: YOU DON'T.
"Timing" the marketplace is a skill that few of us have ever perfected (even those of us who do this for a living) in spite of financial forecasts, pie charts and economic graphs put out by experts with advanced degrees (and LOTS of important initials behind their names).
With all due respect to Buyers who claim bragging rights for having bought at the bottom of the marketplace; they were often more lucky, than smart. (Which isn't to imply that they weren't smart, but does suggest that they were also VERY lucky.)
With respect to my own buying and selling history, Cliff and I have experienced both ends of the spectrum and only in hindsight could we have charted the peaks and valleys accurately. Our first home was a small flat in a two-unit building in San Francisco we had purchased with a partner. The market was down at the time and although the building needed MAJOR TLC, there was little competition so we scraped together the money and bought it. Ditto for house number two. (How I wish we still owned either of those homes today.)
By the time we crossed the Bay Bridge into Piedmont, the market has appreciated substantially and like today's marketplace, we found ourselves in heavy competition on virtually every home in which we had an interest. Eventually Cliff and I ponied up and paid what seemed like a small fortune at the time for an out-of-reach house that had just reduced its listing price, but was still a major STRETCH.
Luckily, markets (for better or for worse) tend to be relative and our San Francisco home had received seven offers, allowing us to make the BIG jump. Happily, we could almost (almost) afford the property as a result. (For those of you tracking, the East Bay, by comparison, is still the best buy around.)
Cut to 2008 and like every home in our community, our property values had plummeted. (Ouch, that's never welcome news.) Yes, even here in Piedmont, where values are often buffered by strong school performance, home prices took a sharp correction based on the financial crisis and bail outs. As poor timing would have it, the house still needed major renovating and the banks weren't exactly throwing money our way. (Not to worry, we weren't selling but the refi appraisal was a very sobering moment, to say the least.)
Gratefully, we had banked quite a bit of equity over the years so we stayed the course, did the work and came up with the funds from other streams of investments. Last year, that home sold for far more than we ever expected (thank you) and we turned around and bought yet another "fixer." (Truly, there should be a 12-step program for serial renovators. I can't seem to stop.)
What's the moral of the story?
Don't worry about "timing" the marketplace. In my experience, luck is largely a matter of when "opportunity meets preparation." Like all markets and investments, real estate is cyclical. It goes up, it goes down and sometimes, it holds steady. Bubble or not, home ownership has historically proven to be a very sound investment over time.
That being said, here are my two cents, for what their worth, and a few caveats as well . . . just for good measure.
Your home shouldn't become your piggy bank. If you expect this investment to turn into your "nest egg" years from now, that plan requires you to pay down the mortgage. Thus when the market is UP and you decide to take advantage of it, your equity will not only be intact, it will have grown considerably.
If you borrow money against your home, make sure its put to use improving the house (not buying a boat or going on vacation). Home ownership requires ongoing maintenance. Maintain them and you'll be well rewarded. While it's tempting to use your home's equity like an ATM, you'll pay dearly for it later on.
Homes are NOT short-term investments. The cost to buy and sell alone in California will add another 10% to your move up (or down) so settle in and stay awhile. Transfer taxes, commissions, loan origination fees, title and escrow fees, etc., etc., etc., are an expensive process so plan on staying seven to ten years in your home before moving on, moving up, or moving out.
Don't stretch, but do reach. It's not about the price as much as it is about your carrying costs. A house shouldn't break the bank, but if you outgrow your new home in just a few short years, you'll likely end up paying far more for the next property you should have bought the first time around.
Finally, if you've identified the house of your dreams, pay the going rate (assuming you can afford it). While you may hear it over and over in marketing, the majority of homes here in the Bay Area truly are, unique. Unlike the suburbs where the next development offers a fresher, newer model, our housing stock IS in fact, one-of-a-kind. If you're waiting for the market to go down, it's likely that turn of events will coincide with interest rates going UP (!) and that can very likely cost you much more in the long term.
As all of us who have more than a few decades of marriage and child rearing under our belts, know that life doesn't necessarily happen at the "right time." We can plan ahead for the unexpected (and we should) but babies arrive, parents depart, kids go off to college, markets expand and contract, and our housing needs change and adjust as we grow up, grow out, and grow older - irrespective of the best suited 'timing.'
If you're as quick as my dog, Buck, you'll pounce when the opportunity arises.
How can I help you?
"Volleyball at Dracena Park is on!" the email said.
I'd been receiving these postings for several weeks but was hesitant to join in and play. Truth be told, I'd actually met my husband, Cliff, during a "wallyball" clinic at a health club on Telegraph Hill more than 25 years ago and we played both wallyball and volleyball almost nightly, so I don't just love the game of volleyball, I'm nostalgic about it.
Moreover, our gang were regulars at Crissy field on the weekends and along with my sister, Jill, I had even started a weekly, outdoor volleyball league for architects and designers in San Francisco culminating with a BIG annual tournament each year in Golden Gate Park. Still two (plus) decades later . . . I wasn't sure that any of the skills I had acquired long ago would still be readily (or physically) accessible.
As sports go, I truly believe that volleyball is the most collaborative of all team challenges. With 2-6 players on a side, there's a tremendous amount of choreography and communication that has to happen in order to win the point. Without clear communication, you're sunk. I gathered my courage and convinced Cliff to come with me and within a few moments we had essentially taken over our teams. (Neither of us are exactly shrinking violets.)
"The second ball is always the setter's," Cliff instructed. "If you can't get to it, yell 'HELP!'"
"Flatten out your forearms," I suggested to another player" or your knuckles will send the ball flying in all directions. (That would never do.) "You'll get used to the pain."
"Up, up UP!"
And so it went until darkness and mosquitoes chased us off the lawn.
"That was so much fun," Cliff and I said to each other as we walked back to the car. "I've missed that."
"Do you suppose," I asked upon reflection, "that the other players are wondering who the hell invited those 'bossy' Gardeners?" (You can thank - or blame - Dhira.)
"I'd be surprised if they didn't," Cliff responded. "They're probably going to sit down to dinner tonight and and say that 'they just came out to have fun'."
"Who plays games just to have fun?" we both said in unison before breaking into laughter. (It's a very good thing we found one another.)
With a nod to just having a good time, it's no fun playing without the proper technique. In fact, I'll argue that the fun in volleyball relies completely on the technique; the dig, the set, the spike and the rhythm of the back and forth; where everyone is moving, talking and responding in kind; the high-fives, the "great set," "good save," and "way to be there" kind of moments. It's a GREAT feeling to block at the net, to dive for the ball, and to ultimately win the point! But win or lose, it's how you play the game.
I should preface this by saying that Tuesday night wasn't the first time Cliff and I have crossed the line from taking a friendly game into the realm of competition. We are merciless at cards, Pictionary, and word games (don't even get me started with spelling games - I've almost lost friends over it).
I guess you could say that we both like to compete, whether it's on the field, at the game table, or at a friendly volleyball match. It's not about winning, per se (although that's a bonus), it's about acquiring skills and using them to your advantage.(If only I could turn laundry or making the bed into a competitive event!)
Not surprisingly, in the world of Real Estate, I'm often asked to compete, not only for the listing where it's almost a given, but often for the sale as well. With too little available inventory to meet popular demand, most well-priced properties are receiving multiple offers in mere days, so like it not, if you are house hunting, you and I ARE going to find ourselves in heavy competition.
Like any competition, there's a technique involved in "crafting the deal" that requires conscious forethought, hard-won skills, and a plan of action. (A bit of luck never hurts either.) Without a preconceived game plan, we will be scrambling to catch up - and as an aside, chasing the ball instead of being in front of it, is never where you want to be in any sport, but especially not in the game of Real Estate.
Thus, the first critical step when house hunting is to meet with a local lender. Before you fall in love with a home, please, please, PLEASE (!) establish your credit worthiness and GET PREAPPROVED for a loan. (I can't stress this enough.) With tougher lending restrictions firmly in place, what you think you may borrow and what you actually can borrow, may be the difference between what you want, and what you can actually afford. Better to know the boundaries upfront than be disappointed in the moment.
And while we're gearing up to compete, here are a few more successful strategies to put into action:
DO get familiar with the marketplace. With the advent of the Internet, your Realtor is no longer the gatekeeper. Stay on top of what's for sale, what's pending and what's sold so that when it comes time to enter the game, you have context. Without it, you'll be lost.
Write to win - or don't write at all. While "winning isn't everything," losing the house of your dreams sure feels crummy. A lukewarm offer merely pushes everyone else's offer higher and in turn, sets the winning bid as the bar for the next go round. If the numbers seem too high to compete, wait for the next opportunity or opening. It's sure to come.
Understand the difference between a negotiation and a battle: one serves the deal, while the other undermines it. Being adversarial for no good reason never works to your advantage.
Communicate, communicate, communicate! The best interactions come about with strong communication - even those in which I've been called to the mat by an unhappy Buyer or Seller. If I don't know what you need, I can't deliver it, address your concerns, or correct what needs correcting, so speak up. We're here to teach each other. Yes? (Yes.)
Finally, if I come off as "bossy," I'm shamelessly unapologetic about it. Without the 'win,' I'm not much help to you, nor will you want me on your team for very long. While my volleyball skills are exceedingly average (at best) I believe that with respect to Real Estate, you are counting on me to bring my considerable experience and skills to the forefront and I'm intent on doing so. Otherwise, why align with an agent at all, especially one like me who, admittedly, is aggressive by nature. (Okay, it's true.)
In other words, who plays the game just to have "fun?" Isn't that what jigsaw puzzles are for? I want to win.
Serve it up. I came to play!
"We're thinking of downsizing," the nice gentleman said at my Sunday Open last week at 610 Blair. "Ideally, my wife and I would love a home with a view (who wouldn't?) but unfortunately, our current home is much larger than we need at this point in time."
"Got it. Are you currently working with an agent?" I politely inquired. (Hey, I know an opening when I see one.) "Uh no, we just wander in from time to time when a sign catches our eye," he sheepishly responded. "We live around the corner and we don't really need an agent just yet, but we love opens . . . plus our daughter has a friend who just got her license . . ." ("All you need is love, love. Love is all you need . . .")
Oh dear. I hear you (and the Beetles) but I respectively disagree. In our uber-competitive world, you're going to need a whole lot more . . . Aside from the fact that ALL Realtors are NOT created equal (experience can only ever be earned over time) Buyers are much better served when they bring a knowledgeable Agent into the process from the start instead of waiting until they have identified a home they desire and then attempt to play catch up.
While it may seem that Realtors are fast becoming redundant, or (perish the thought) virtually replaceable (what with the advent of Zillow, Realtor.com, Trulia, Grubbco.com, and any number of other well-mined real estate SEOs) the fact of the matter is that a fair number of homes are quietly traded in "off market" sales. Which is to say that as a layman, you will never hear about these "off-market" opportunities at all, let alone come across them on the WORLD WIDE WEB.
Still, you wouldn't think that anyone would be interested in selling "off-market" in such an exuberant environment, noted for producing multiple offers - would you? Yet for a certain percentage of Sellers, the "off-market" Buyer presents an elegant and far less intrusive solution AND saves the unwelcome hassle and expense of painting, staging and presenting invariably bring to the process - not to mention, cleaning, purging, packing and often moving out altogether . . . (yes, selling is inconvenient to say the least.)
Moreover, "off-market" sales have the advantage of keeping the deal under the radar - an important consideration for some folk, who frankly, don't want the whole town talking about their private business. (Imagine that?) Please note, It doesn't follow that these "off-market" properties can be bought for less than their MLS listing counterparts. In fact, if you're the Buyer, be prepared to pay a premium for an "off-market" listing - not a discount.
Unless a Buyer is willing to pay enough to keep the Seller from "testing" the marketplace instead of accepting YOUR very compelling offer, there is simply NO incentive to sell behind closed doors. In truth, 'off-market' Buyers are paying NOT to compete with other willing and able on-market Buyers and for that, there's a price to be paid. (Sorry, but that's the skinny.) So repeat after me: "This isn't a deal, it's an opportunity. This isn't a deal, it's an OPPORTUNITY!" Or put another way, value is in the eye of the beholder.
"Okay, so how do I find these 'off-market opportunities'?"
You don't, we do - via phone calls, industry networking, and mining the inside track. Ironically, just as the market appears to be waning as we move towards the holiday season, there is a tremendous amount of strong activity taking place behind the scenes. In fact, a fair number of Agents are already meeting with potential Sellers to begin preparations for Spring 2015. (If that's you and you haven't yet contacted a real estate agent, may I gently encourage you to pick up the phone and call me?!)
Looking forward, my colleagues and I are replenishing the listing/housing stock as we speak, AND within that upcoming inventory, there are likely to be a few candidates who upon learning of the heavy lifting required, will sigh, turn to us and say: "If you know of anyone for whom this house might be a good fit, feel free to bring them by."
"But how do I know I'm not overpaying for this 'opportunity'?" You don't, and what's more, Sellers, in turn, don't know if they could have faired better had their properties run the full course of marketing and exposure either. In short, both the Buyer and the Seller have to agree to live with the unknown - and the question marks that are always inherent in these sorts of transactions. So, before proceeding, understand that good will and trust are never more important than in these "off-market" 'opportunities.' Otherwise, move with the pack and good luck to you. You'll be in very good company.
Finally, a final plug for my often maligned profession: a Licensed Agent will help you prepare to compete, make sure you are preapproved through a local lender, educate you as to current market value, advocate for your interests, and beat the bushes on your behalf. And the best part of this equation, is that Agents are paid only when and if we successfully close a transaction. What's more, here in California, our fees are assumed by the Sellers - not the Buyers - so in essence, you gain the experience, skill and wisdom of our many years of practice - at the expense of the Seller. (Thank you Mr. Seller!) Now there's the deal.
Hey, you can love Real Estate, love the marketplace, love the Internet, and love cruising the Open Homes every Sunday of your life, but you are still going to need an agent you can trust to lead you to the homes that are currently active, those that are coming soon, and those that may never appear . . .
How can I help you?
Julie Gardner, has been writing The Perspective for 15 years and has published more than 600 essays. She is also a frequent contributor to the Sound Off column in the Real Estate section of The San Francisco Chronicle.