Showing posts with label FSBO. Show all posts
Showing posts with label FSBO. Show all posts
Sunday, December 21, 2014
Friday, February 14, 2014
Thursday, January 9, 2014
San Francisco Bay Area Housing Market 2014
by Rick Turley, President of Coldwell Banker Residential Brokerage, San Francisco Bay Area
Four Reasons 2014 Could Be A Very Strong Year for Local
Housing Market
Happy New Year! As we kick off
2014, it's a good time to take a look at what might be in store for the local
housing market in the coming year. While I don't claim to have a crystal ball, I
feel very optimistic about the potential for a strong housing market in
2014.
The Wall Street Journal reported this week that home prices
across the country – but especially in Silicon Valley and other parts of the
Bay Area – have zoomed back to near record territory. Valuations jumped 25% or
more in some communities over the past year, nearing or even exceeding their
pre-recession highs. Prices in Palo Alto are nearly 40% above their 2007 peak,
one of the largest gains in a recent survey.
So what do we do for an encore in
2014? I see four major reasons why the Bay Area's housing market will continue
to be strong in the coming year:
1. A robust local economy. The Bay Area economy is one
of the strongest in the country. Silicon Valley, the Peninsula and San Francisco
are the high-tech, Internet, VC and social media centers of the world.
CNNMoney's tech job forecast for 2014 is "Hot and Getting Hotter." Tech job site
Dice.com reports that 55% more employers — a record high — say they're ready to
hire a large numbers of techies, up from 42% in the second half of 2013. These
well-paid knowledge workers will provide an even stronger, better-capitalized
pool of buyers for our housing market in the coming year. Just noted in USA
Today, the bay area’s fourth largest city, Fremont, has seen a return to a
strong housing market, and is regarded as one of the best run cities in the
country. http://usat.ly/1crnbWi From the Wine Country in
Sonoma, south to Carmel and Pebble Beach, and across to Livermore, we are
fortunate to have healthy, diverse, and prosperous cities and towns in our nine
Bay Area counties.
2. Supply and demand. While
the demand side of the equation was extremely strong last year with buyers out
in force, the supply continued to be historically low. This resulted in prices
getting bid up in multiple-offer situations and many would-be buyers walking
away empty-handed. No one knows for sure what will happen to inventory in the
coming year, but our agents are telling us more listings are expected in the
coming weeks. I suspect homeowners are reading the same news stories we are and
seeing that prices have been shooting higher, and they may finally be ready to
cash in. Rising prices also change the dynamics for many homeowners who had been
underwater in their mortgage as recently as six months or a year ago and weren't
in a position to sell. With prices jumping, many of these homeowners now have
positive equity once again and have the option of selling and walking away with
cash for the first time in years.
3. Interest rates. Interest
rates remain historically low, but make no mistake about it: They are moving
higher once again. Some economists are forecasting mortgage rates could rise a
full percentage point before the year is over. This is a clear wakeup call for
those buyers who have been on the sidelines waiting for the perfect time to get
into the market. The time is right now before mortgage rates move higher. An
increase of just one percentage point on a $500,000 mortgage adds $300 to a
monthly payment or $3,600 a year. Buyers know that and will be rushing to beat
the next rate hike.
4. Increasing costs of
renting. As the Bay Area economy comes roaring back from recession,
available apartments are drawing long lines of potential tenants and rents are
spiraling higher, according to a recent story in the San Francisco Chronicle.
"Rents in San Francisco are escalating at breakneck clips this year, largely
driven by an influx of tech workers. Oakland and San Jose likewise are seeing
steep run-ups," the article notes. Median asking rents for San Francisco
apartments listed on www.livelovely.com hit a record $3,398 in the third
quarter, up 21 percent from 2012, according to the Chron. Such huge rent
increases continue to make buying a home a better financial proposition. My
sense is that buyer demand will only increase in the new year as renters see
their personal economy improving with a better job market and higher
salaries.
Three of the four above are
particularly unique to our Bay Area. Few cities around the US have this same
alignment of economic conditions. NAR is predicting growth in the 5+% range
across the nation in 2014 and I feel that number is conservative for us. Every
one of our offices expect a strong first quarter as some new inventory comes to
the marketplace.
Visit www.RealtorLisaWu.com or Email to RealtorLisaWu@yahoo.com
WILL 2014 BE THE YEAR FOR MOVE-UP BUYERS?
The housing market has enjoyed a
strong rebound over the past few years with sales and median prices steadily
improving across the country and especially here in the Bay Area. For a variety
of reasons, one segment of the market has not bounced back quite as fast: the
“move-up” market. But that could change in 2014.
The recession took its toll on many homeowners, especially those who bought near the peak of the housing market. As property values dipped, many of these consumers found themselves “underwater” on their mortgage – that is, owing more than it is worth.
But as home prices continue to climb and home equity levels steadily improve, more homeowners are once again in a position to trade up. The National Association of REALTORS® expects the median sale price nationally to be up 11 percent in 2013 from the previous year. And some parts of the Bay Area have seen median prices jump 15-20 percent or more.
Move-up buyers are gradually coming back into the market due to improving equity, according to a new report from FNC, a real estate data and technology company.
If you have outgrown your existing home or simply want to buy another home in a more desirable neighborhood, now may be the time to make your move.
Interest rates may have ticked up a bit over the past year, but remain attractive. And your current home may be worth more than you think, giving you more money to put into a down payment on your next home.
Buying a home when you currently own one does have its challenges. If you sell first, you may be left scrambling to find a new place to live or forced to settle for a house that isn’t right for you. But if you buy first, you may not have the cash to put down on your next home – even if you do qualify for another mortgage. And you run the risk of having to make two house payments each month while you own both homes.
But some careful planning and the guidance of a professional REALTOR® can help you overcome these challenges and take advantage of the move-up market. Here are a few tips from the National Association of REALTORS® to get you started:
©2014 Coldwell Banker Real Estate LLC. All Rights Reserved. Coldwell Banker® is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Equal Housing Opportunity. Each Coldwell Banker Residential Brokerage Office Is Owned by a Subsidiary of NRT LLC. If your property is listed with a real estate broker, please disregard. It is not our intention to solicit the offerings of other real estate brokers. We are happy to work with them and cooperate fully. CalBRE License #01908304
The recession took its toll on many homeowners, especially those who bought near the peak of the housing market. As property values dipped, many of these consumers found themselves “underwater” on their mortgage – that is, owing more than it is worth.
But as home prices continue to climb and home equity levels steadily improve, more homeowners are once again in a position to trade up. The National Association of REALTORS® expects the median sale price nationally to be up 11 percent in 2013 from the previous year. And some parts of the Bay Area have seen median prices jump 15-20 percent or more.
Move-up buyers are gradually coming back into the market due to improving equity, according to a new report from FNC, a real estate data and technology company.
If you have outgrown your existing home or simply want to buy another home in a more desirable neighborhood, now may be the time to make your move.
Interest rates may have ticked up a bit over the past year, but remain attractive. And your current home may be worth more than you think, giving you more money to put into a down payment on your next home.
Buying a home when you currently own one does have its challenges. If you sell first, you may be left scrambling to find a new place to live or forced to settle for a house that isn’t right for you. But if you buy first, you may not have the cash to put down on your next home – even if you do qualify for another mortgage. And you run the risk of having to make two house payments each month while you own both homes.
But some careful planning and the guidance of a professional REALTOR® can help you overcome these challenges and take advantage of the move-up market. Here are a few tips from the National Association of REALTORS® to get you started:
- Assess the market. Compare your current and future neighborhoods and determine which area is a buyer’s market and which is a seller’s market. If your current neighborhood is a hot seller’s market, you may be better off buying elsewhere first and then selling yours since it might be easier to find a buyer.
- Selling your home first. If you end up selling your home before buying another, you will need a place to live in the meantime. One option is to enter into an occupancy agreement with the buyers of your home to enable you to retain possession for a short period of time.
- Other temporary options. If the buyers of your home need to move into your home immediately after escrow closes you may be able to stay with family or find a short-term lease on an apartment. Many “extended stay” hotels and apartments offer leases for a month or longer. You’ll have to put many of your possessions in storage, but they’ll be packed and ready to go when it is time to move into your new home.
- Buying your next home first. If you end up buying your next home before selling your first one there are a couple of ways to come up with the new down payment. Check with your lender to see if you can secure a home equity line of credit. The interest rate may be tax deductible up to $100,000 and it could be paid off once you sell your home. Be sure to check with your lender before you make any decisions to determine what options may or may not be available.
©2014 Coldwell Banker Real Estate LLC. All Rights Reserved. Coldwell Banker® is a registered trademark licensed to Coldwell Banker Real Estate LLC. An Equal Opportunity Company. Equal Housing Opportunity. Each Coldwell Banker Residential Brokerage Office Is Owned by a Subsidiary of NRT LLC. If your property is listed with a real estate broker, please disregard. It is not our intention to solicit the offerings of other real estate brokers. We are happy to work with them and cooperate fully. CalBRE License #01908304
Thursday, September 5, 2013
For Sale By Owner (FSBO): The Drawbacks of Going it Alone on a Home Sale
With housing on the upturn, multiple offers and rising sales prices are being reported in our market. Some potential home sellers might think that selling their home simply requires placing a “for sale” sign in their front yard. Many sellers have learned the hard way that selling a home in today’s marketplace is much more difficult than they imagined; their efforts to save money on commissions may have been more costly than they anticipated.
Before venturing into doing the do-it-yourself option of being a for-sale by owner (FSBO), you need to fully understand what is involved in the selling of real estate and then compare the perceived advantages and the actual disadvantages of trying to sell your property on your own.
Here are seven good reasons why hiring an experienced professional REALTOR® may actually net you more money on the sale of your home when all is said and done – as well as save you countless hours, headaches and stress in the process:
Being a FSBO may not actually save you as much as you think. While you might save some of the cost of hiring a professional real estate agent to represent you, you may still need to pay 2 percent or more to the buyer’s agent in order to attract a larger pool of buyers. Additionally, the true “savings” may be far less after you add all the other costs associated with selling – advertising, brochures and flyers, for-sale signs, attorney fees to draw up documents, etc.
You may get less for your home. The National Association of REALTORS® found that the typical FSBO home sold for $174,900 compared to a sales price of $215,000 for agent-assisted sales. That equates to an 18 percent loss for those do-it-yourselfers hoping to save a 6 percent commission. In addition, prospective buyers of a FSBO property, looking for a bargain, may automatically reduce their offer by the amount of the real estate commission the seller is attempting to avoid paying.
A LOT goes into selling a home. Less than 10 percent of sellers sold their home on their own last year, according to NAR®. Novice sellers may think you just stick a for-sale sign in the front lawn and buyers will beat a path to your door. Guess again! Professional agents develop comprehensive marketing plans, take professional photos, manage inspections and appraisers, oversee staging, hold open houses, place print and online ads, seek out potential buyers and negotiate with the buyer’s agents to get the best price possible for their seller. Homeowners need to ask themselves if they are ready and capable to do all of that work on their own.
FSBOs limit their potential pool of buyers. FSBO properties are usually not listed on as many of the home search engines and websites as listings handled by real estate agents. This is problematic given that 90 percent of buyers use the Internet to commence their home search, according to NAR®. Also, FSBOs typically can’t put the advertising, marketing and networking resources into reaching as many potential buyers as real estate professionals do. And with commissions reduced or even eliminated for buyer’s agents, there’s little incentive for real estate agents to show your home to their clients.
Setting the right listing price is hard to do. Real estate professionals review comparable sales and local market conditions, as well as the pluses and minuses of your home as they suggest the list price. As an owner, you may not have a clear or objective sense of what that price should be. The right price may get your home multiple offers and perhaps even bids over the asking price. However, if the list price too high then many potential buyers may not even look at your home, let alone make an offer. On the flip side, you could undervalue your home’s features that may justify a higher sale price.
It’s not always easy to be a “closer.” Getting a potential buyer to make an offer isn’t the end of the process. It is not uncommon for agents representing buyers and sellers to negotiate back and forth on many of the terms in the purchase contract, including price, occupancy requirements and other conditions of sale – and there are often additional negotiations regarding credits and repairs during the escrow process. FSBOs may find themselves sitting across from an experienced “closer” looking to drive a hard bargain and cut the best deal for themselves rather than working to reach a “fair” compromise between both parties. This is a critical part of the transaction; FSBOs should ask themselves who is looking out for their best interests? Working with a professional REALTOR® could help sellers avoid several of the pitfalls during the negotiation and closing processes.
Legal landmines in selling a home. There are a myriad of potential legal landmines for FSBOs. Who will write the purchase contract? What if a buyer’s contract proposal has clauses and other terms that could be detrimental to you? Sellers are obligated to disclose all material facts about their property and any omission or incorrect information could later be grounds for a claim or lawsuit. A REALTOR® can help you through that process by providing you with the correct advisories and disclosure forms.
Selling a home is a lot harder than most people realize, even in a good market. And it’s very easy for non-professionals to make mistakes along the way that will end up costing them in the long run. With the sale of a home being the single biggest transaction most of us will ever make, this is the time to use an experienced REALTOR® to manage the process. I’m ready to help. Visti me at www.RealtorLisaWu.com
Before venturing into doing the do-it-yourself option of being a for-sale by owner (FSBO), you need to fully understand what is involved in the selling of real estate and then compare the perceived advantages and the actual disadvantages of trying to sell your property on your own.
Here are seven good reasons why hiring an experienced professional REALTOR® may actually net you more money on the sale of your home when all is said and done – as well as save you countless hours, headaches and stress in the process:
Being a FSBO may not actually save you as much as you think. While you might save some of the cost of hiring a professional real estate agent to represent you, you may still need to pay 2 percent or more to the buyer’s agent in order to attract a larger pool of buyers. Additionally, the true “savings” may be far less after you add all the other costs associated with selling – advertising, brochures and flyers, for-sale signs, attorney fees to draw up documents, etc.
You may get less for your home. The National Association of REALTORS® found that the typical FSBO home sold for $174,900 compared to a sales price of $215,000 for agent-assisted sales. That equates to an 18 percent loss for those do-it-yourselfers hoping to save a 6 percent commission. In addition, prospective buyers of a FSBO property, looking for a bargain, may automatically reduce their offer by the amount of the real estate commission the seller is attempting to avoid paying.
A LOT goes into selling a home. Less than 10 percent of sellers sold their home on their own last year, according to NAR®. Novice sellers may think you just stick a for-sale sign in the front lawn and buyers will beat a path to your door. Guess again! Professional agents develop comprehensive marketing plans, take professional photos, manage inspections and appraisers, oversee staging, hold open houses, place print and online ads, seek out potential buyers and negotiate with the buyer’s agents to get the best price possible for their seller. Homeowners need to ask themselves if they are ready and capable to do all of that work on their own.
FSBOs limit their potential pool of buyers. FSBO properties are usually not listed on as many of the home search engines and websites as listings handled by real estate agents. This is problematic given that 90 percent of buyers use the Internet to commence their home search, according to NAR®. Also, FSBOs typically can’t put the advertising, marketing and networking resources into reaching as many potential buyers as real estate professionals do. And with commissions reduced or even eliminated for buyer’s agents, there’s little incentive for real estate agents to show your home to their clients.
Setting the right listing price is hard to do. Real estate professionals review comparable sales and local market conditions, as well as the pluses and minuses of your home as they suggest the list price. As an owner, you may not have a clear or objective sense of what that price should be. The right price may get your home multiple offers and perhaps even bids over the asking price. However, if the list price too high then many potential buyers may not even look at your home, let alone make an offer. On the flip side, you could undervalue your home’s features that may justify a higher sale price.
It’s not always easy to be a “closer.” Getting a potential buyer to make an offer isn’t the end of the process. It is not uncommon for agents representing buyers and sellers to negotiate back and forth on many of the terms in the purchase contract, including price, occupancy requirements and other conditions of sale – and there are often additional negotiations regarding credits and repairs during the escrow process. FSBOs may find themselves sitting across from an experienced “closer” looking to drive a hard bargain and cut the best deal for themselves rather than working to reach a “fair” compromise between both parties. This is a critical part of the transaction; FSBOs should ask themselves who is looking out for their best interests? Working with a professional REALTOR® could help sellers avoid several of the pitfalls during the negotiation and closing processes.
Legal landmines in selling a home. There are a myriad of potential legal landmines for FSBOs. Who will write the purchase contract? What if a buyer’s contract proposal has clauses and other terms that could be detrimental to you? Sellers are obligated to disclose all material facts about their property and any omission or incorrect information could later be grounds for a claim or lawsuit. A REALTOR® can help you through that process by providing you with the correct advisories and disclosure forms.
Selling a home is a lot harder than most people realize, even in a good market. And it’s very easy for non-professionals to make mistakes along the way that will end up costing them in the long run. With the sale of a home being the single biggest transaction most of us will ever make, this is the time to use an experienced REALTOR® to manage the process. I’m ready to help. Visti me at www.RealtorLisaWu.com
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