We're officially into our summer market, but just because inventory has diminished, it doesn't necessarily follow that interest has . . . or that prices will. . .
Still, July and August can be great months to step in and purchase a home while others are away on vacation or distracted with swim lessons, tennis camps, family outings or travel abroad. In truth, fewer Buyers at the table should equate into less pressure on the final sales price, so personally, I've always been a fan of the summer opportunities, even while appreciating the need to get away and relax.
By the way, it's not just some Buyers that have strayed, but many of their Agents as well, as they too, seek time away from the unyielding hustle and bustle the Spring Market invariably brings. (Not that I'm complaining, mind you - productivity equals private college tuition.)
But who can blame the public for tuning out and taking some much needed "down time" once summer beckons? (Not me.) As everyone quickly learns, buying or selling a home can quickly move into a full-time job AND a heavy Internet addiction, especially here in the Bay Area. For many who've faced rejection a time OR two, OR three, OR FOUR . . . August often provides a bit of a breather and a welcome respite. (You're not alone.) Go ahead and enjoy some time off - you've undoubtedly earned it.
As for me? I'll be heading to Tahoe this week for a little R&R and hoping there's still some water left in the lake. (Please tell me there is.) I'll still be writing offers and reading disclosures, but I'll be doing it in shorts and flip-flops and that's at least something.
Speaking of which, according to a good friend and fellow agent, prices in Tahoe have plummeted a whopping 53% on the heels of a four-year drought and an absence of snow! (Aren't you grateful you bought here?) Ouch! That can certainly sting if you're selling a lakeside home right now. If you're not, don't lose a moment's sleep. The value of any home is ONLY ever relevant come time to sell.
Unfortunately, for some in the Tahoe region, that time is now.
"We took a bath on our cabin in Northstar," Caroline shared (too bad, I liked that house a lot and I'm sorry to see it go.) "So Uncle Sam received NO capital gains from us . . . we sure showed him a thing or two," she laughed. (Caroline has a great sense of humor and a positive point of view.)
As she should. Not only is Caroline extremely gifted at her craft, she's spent the majority of her adult life selling real estate in and around San Francisco, and has experienced the variables first hand. As such, she's watched the market go up and down and has navigated both ends of the spectrum with a steady hand and uncompromising integrity. As good timing would have it, she's seen more UP markets, than down, so she's come out far ahead on the deal, and she'd be the first to tell you so.
But here's the basic premise that harkens back to economics 101: ("Beuller? Beuller? Beuller?") markets aren't static instruments - they have a propensity to move!!! When and how much, is how fortunes are won and lost, I suppose, but over TIME, home values have climbed and home ownership (aside from being a lovely place to hang one's hat) has generally been well rewarded. According to the California Association of Realtors CAR), one in four Americans (27%) believe that Real Estate is the single best investment, far outpacing the stock market (17%) for the first time in many years.
Even so, none of us wants to pay TOP DOLLAR for our homes.
"Has the market peaked?" (It's unclear.)
"So how much is this house going to sell for?" (That remains to be seen.)
"How much will I need to offer?" (How much do you really want the home?)
"Will we be overpaying for the house in this market? (That depends on how long you plan to hold the property.)
"I don't suppose you'll know what other parties are offering?" (No, I won't.)
"Will we know what the other offers were after the fact? ("No, you will not - nor would you want to.)
And so the questions continue . . .
(Gee, I wish I had more definitive answers for you.)
The truth is, that regardless of the number of years one has writing offers and putting homes into escrow, the process in a Sellers' Market is largely a blind auction. The list price merely sets the starting point in a multiple bidding situation and while not every house is procuring multiple offers, the vast majority of them are. Where exactly a home will ultimately trade, is largely an educated guess and a clear understanding (on your part) of how much you want the home OR how willing you are to walk away (or not!).
Oh, that's not much fun. (No, it isn't.) I understand your frustration and to add to the confusion, the market won't always stay this way.
But here's another truth - the price you pay in today's world is largely irrelevant in tomorrow's . . . (as long as you plan to hold the house for 10 years or more).
By way of example, yesterday I met a darling, elderly couple in front of their home, who had bought their house at a probate auction 40 years ago for $90,000; a bargain by today's standards - and then some . . .
"I was furious with her," the husband confided to me. "I wanted to back out of the deal; it was soooo much money for us at the time. Good thing she didn't listen to me," he said with a wink and a nod, pointing at his better half. His wife simply smiled.
That's the ending we're all hoping for. No, not the part where we don't listen to our husbands, but where we made a wise decision!
Now go hit the beach (there's plenty of it).
How can I help you?
Let's just admit that conserving water isn't the sexiest of topics. Because I am in the middle of purchasing a series of cisterns to tuck under my new deck in order to collect the rain for the gardens that have yet to be planted, water conservation is very much at the forefront of my mind.
Given the drought, I think it's front and center for most of us. Whether it's shorter showers or fewer car washes (or as in my husband's case, the reason he doesn't mop the floors) we're clearly all in this together - at least until the rains return to refill the lakes and reservoirs once more.
While weather forecasters predict an El Nino year ahead (wouldn't that be nice?) running short on water isn't new to most of us who have been down this dusty road before. In truth, much of California is a desert state that's highly irrigated, leaving us fairly vulnerable to a snow pack that's all but gone away. Forget the lack of good skiing and the impact on boating, what about simply having enough water for the state??
What's more, homeowners seemed to have received the message loud and clear as more and more lawns give way to drought tolerant landscapes and flower beds usher in California natives (as they should). In reality, keeping a lawn green not only demands copious amounts of water, it usually requires a fair amount of pesticides as well and that's never good for anyone, no matter the measured rainfall.
As a gardening buff, the biggest myth is that a sprawling lawn is low maintenance. It isn't. From mowing to grooming to watering, it's highly time AND resource intensive. As such, succulents and native grasses have never been more popular and with good reason; they're not only drought tolerant, they're incredibly interesting, especially in bloom.
But what about the kids?
Take them to the park. It's been my experience that the moment a child is old enough to hit the ball over the fence, they've already outgrown the backyard (even when it's quite spacious.) Moreover, today's young kids are so heavily scheduled with after-school activities that they're probably not spending much time in the garden anyway. With all due respect to "the land," my closest adult bonds were forged with other mothers (and fathers) at the park and playground in those early child-rearing years. (That's where my sanity returned as well.)
Hopefully, these photos should inspire you to think twice about the space out front and back. For those of us fortunate enough to own a patch of green, you'll find there are many terrific solutions that still allow you and the kids to enjoy the gardens as much as ever. Think hardscape, paths and borders instead of expansive lawns and you'll be on your way to a more carefree and far less thirsty garden (honest). Plus, with stringent rules and heavy fines in place about how often one can actually turn on the sprinklers,you'll have much better results as well.
Finally, avoid the red lava rock and juniper look that was favored in our parents' day and steer away from ivy, which serves as a verdant ground cover, but also invites all kinds of rodents into it's cool leaves. With so many fabulous offerings at your local nurseries, there's no absence of sustainable choices. And as a bonus, even the brownest of green thumbs should be able to easily maintain a drought-tolerant garden. So enjoy your garden and think "vignettes." I guarantee you'll use your yard MUCH more when the lawn gives way to outdoor rooms instead of lawn . . .
Shhh, don't tell anyone, but I've got another birthday coming up.
I'm old enough now that such news isn't met with immense pleasure. (Who really likes getting older once you're past the age of 35?) As too often happens, the fifties bring their fair share of unexpected loss in the form of friends or family members who just yesterday, were walking beside you, and sadly, no longer are. (Sigh.)
So, in spite of the wrinkles and crow's feet, I'm going to try and embrace 55 with grace and gratitude, and with the recognition that getting older beats the alternative of not getting older. Here's where I'm luckier than most; I share the day with my twin sister, Jill. She's my birthday gift and in honor of the occasion, we're headed to Los Angeles to visit her two daughters, where the four of us plan to hit the "Magic Kingdom" for the day. After all, it's "the happiest place on earth" (or so the tag line tell us).
Whether true or not, the famous moniker is beside the point. Disneyland is merely the backdrop for the opportunity to pass some time with the girls reliving our youth and catching up. I've learned that time together is a rare gift, especially as our children grow up and move on (sniff, sniff). So if reuniting requires a trip to Disneyland, I'm all in - bring on "the gift."
Recognizing "the gift" is a concept that isn't generally wasted on Realtors but unfortunately, often gets away from our clients who don't always understand the nuances of the deal, or the market openings, especially as the market becomes tougher and tougher to comprehend.
The plain truth is, that one must respond and react to the market as it is - not as we wish it to be - which requires some objectivity that can be incredibly difficult to find 'in the moment.' (Truth be told, Buyers and Sellers haven't much practice as they only enter the market once every decade or so.)
But in its simplest terms, "the gift" is the offer that exceeds expectations. (Wow!)
In the multiple-offer scenario, it's not unusual to receive an offer that stands head and shoulders above the rest. (Congratulations.) Typically, such offers are proffered by the Buyer who either recognizes the value of the property and is willing to step up and pay for it, or by the Buyer who's lost several bids and has now mastered the learning curve. In both cases, the offer is intended to definitively "win" the house - not head back for a second round.
But "the gift" may also be in identifying the house in the first place, that, for whatever reason, has been passed on by the herd, due to unfortunate timing or other unexpected conditions that may have caused it to be overlooked. Opportunity knocks!
The "gift" also comes for those who quickly discover their 'perfect' home and act upon it with good speed. A few weeks back, I sold a home to Buyers who had come over to the East Bay to purchase a painting and ended up detouring to an Open House. True to form, the selling agent was taking offers two days later. Rather than talking themselves out of the deal, they phoned me instead and by Tuesday night, they were in contract.
(Note to Buyers: quick decision makers will always trump those who are more conservative by nature; however, "the gift" in this case, may have been mine. It's truly a blessing when everything goes according to plan.)
"The gift," also comes in the form of acceptance, as in "Thank you for your lovely offer, the Sellers have signed the purchase contract and I'm pleased to inform you that your Buyers got the house." Having your offer accepted and not second guessing this windfall, is indeed, a "gift." Take it and call the movers - quick! This isn't the time to start looking for an exit strategy.
Sometimes, "the gift" comes by way of a "preemptive offer." "Preemptive offers" are those that arrive as soon as a house hits the market, OR in some cases, even before a house has been formally introduced. Typically, a preemptive offer comes from a highly-motivated Buyer who also often brings the BEST offer to the table - at any point in time. Because the house hasn't yet been "market- tested," these early offers are as equally tough to dismiss as they are to accept which, understandably, can leave the Sellers at an impasse (who can blame them?) but also, at a loss should the market fail to deliver more. . . (Only time will tell.)
My point is that "the gift" comes in many forms, but we have to recognize them as such, be open to the possibilities, engage in the process, and work the opportunities that come our way.
Because we're human (ergo imperfect) and we live in a culture that often rewards "one upmanship," it may be our natural inclination to counter back and question the outcome. (Believe me, you have more to lose than to win.)
"But do you think they'll give us more?"
They might, but please understand the risk, which is considerable! When Buyers have offered in the neighborhood of 25 %, 40% or 60% (!!!) MORE than the list price, chances are, they've come to the table with their best and final offer. Moreover, they may be easily offended by such demands and walk away altogether. More often than not, the next offer in line, represents a significant drop in price and yes, that actually happens when greed overtakes common sense.
Keep in mind that buying a home isn't a business transaction - it's an emotional one - and therefore, far trickier to successfully navigate. Remember, the end goal is to sell or buy the home, not beat the opponent. If you avoid turning the purchase into an adversarial process, you'll be far better served, because a happy ending for everyone is ultimately a real "gift!"
Speaking of which, I've got cookies to make for the potlucks tomorrow so I better get baking. Maybe the "happiest place on earth" is no further away than the red, white and blue celebration on Highland Avenue in Piedmont. Hope to see you on the parade route.
Happy Birthday America! (And happy birthday, Jill. I'm ready for our road trip.)
Julie Gardner, has been writing The Perspective for 18 years and has published more than 670 essays on life and real estate.