Articles to Share – Page 30 – The Real Estate Beat

Estate Planning: 11 Things to Do Before You Die

Death is not a topic anyone wants to think about, let alone talk about. However, it is the inevitable outcome of life and something we can plan for. I learned the hard way when my father passed of a heart attack – we were in the midst of planning for this day – we just hadn’t gotten that far. It took me months to comb through boxes and boxes of paperwork to piece together everything. I wouldn’t wish this on anyone. So today, you can take steps to make the end a little more manageable for your family. I found this article on Legal Zoom and thought I would share it here. It takes but a moment to create a trust, to write down the passwords and your wishes. Do it now – in good health – and know, when the time comes – you have helped your family with the one thing they don’t ever want to think about.

– Thank you for reading – Sabrina

Estate Planning: 11 Things to Do Before You Die

Pondering your own mortality is probably not high on your list of enjoyable activities, and yet getting your affairs in order is advisable for everyone.

You may think “estate planning” is only for the wealthy, or that—since you’re relatively young and/or healthy—you don’t need to worry about such things, but neither is true.

Even people with modest assets can benefit from end-of-life planning, which encompasses much more than just writing a last will and testament. And, as we all know, death doesn’t discriminate by age or any other factor.

A little forethought now about how you would like things to go once you’re incapacitated or gone can give you great peace of mind now, as well as spare your loved ones a lot of hassle later.

What are some of the most important things you can do now? Here is a handy estate planning checklist.

Gather important documents and contact information.

Property deeds, vehicle titles, official certificates (birth, marriage, etc.), the contact information for your attorney, insurance broker, doctor—all of these are things you can gather and put in the same, safe place now to make it easier for your loved ones later.

As a bonus, getting all these materials together should also make compiling your estate plan easier, as you will have a lot of the necessary information at your fingertips.

Execute a last will and testament.

A will is one of the most important estate planning documents you can have, as it details where you would like your property go after your death. Unless you make a will, you are leaving things up to your state’s intestacy laws, which apply when someone dies without a will. And you should not assume that the state will make the same choices you would have made.

When you create a will, you, the testator, name an estate administrator or executor: a person you trust to handle the distribution of your estate. You can also name a legal guardian for any minor children and their property, as well as leaving instructions for the care of your pets.

Complete a living will or advance directive.

A living will or advance directive is a legal document in which you name someone to communicate with medical personnel regarding your treatment preferences should you become incapacitated or otherwise unable to express your preferences yourself.

Issues addressed in living wills generally include breathing tubes, feeding tubes, and other life-sustaining medical treatments.

Put in place a power of attorney.

A durable power of attorney allows you to name someone to be in charge of making decisions for you if you become incapacitated. You may choose to name a separate health care power of attorney for medical decisions and a financial power of attorney for financial decisions.

A health care power of attorney works hand-in-hand with a living will to ensure that your wishes regarding medical treatment are followed. A Health Insurance Portability and Accountability Act (HIPAA) authorization is also necessary to allow others to speak with doctors and nurses about your condition.

Establish a living trust.

A living trust can be a great way for you to make sure your wishes are followed after your death, as well as providing for fast distribution of your assets to beneficiaries, avoiding estate taxes and keeping your financial affairs private.

With a living trust, you, as the grantor, retain control over any property placed within the trust throughout your lifetime. Upon your death, your pre-chosen successor trustee gains control of the trust and will then distribute your assets according to your instructions—all bypassing probate, thus saving both time and money.

An irrevocable trust can also serve as asset protection, to protect your property from being touched by creditors or lawsuits.

Update your beneficiaries.

If you have life insurance, retirement accounts, pensions, or pay-on-death (POD) or transfer-on-death accounts, make sure your beneficiaries are up to date, as these accounts transfer according to their beneficiary designations; your last will does not control them. Any time there is a change in your family situation is a good time to review your beneficiaries.

Secure your digital assets.

Along with online bank, investment, and shopping accounts, many people also have social media accounts that need handling upon the death of the owner.

Facebook, for instance, has a special section in which you can select someone to take over your account upon your passing, but you should also think about what you want to happen with websites, blogs, and any other online activities in which you participate.

Plan final arrangements.

Final arrangements can include organ donation, as well as funeral plans, including how they are to be paid for. Pay-on-death bank accounts are often the best way to handle funeral expenses.

Your will isn’t the best place to include this information because it often isn’t read immediately, so a letter to your estate administrator or a trusted loved one is best.

Make copies and store.

Once you have gathered all your estate planning documents, make copies and store the original and copies in a safe place, such as a fireproof safe in your home or a safe deposit box. Make sure at least one other person will be able to access these documents after your death.

Talk with your loved ones.

Just getting everything down on paper is a great step forward in estate planning, but talking with your loved ones about your wishes is priceless. The clearer they are on what you want, the more likely it is that your wishes will be followed—and the fewer problems they will have, as they won’t have to guess your intentions.

This talk doesn’t have to be all grim and dire, however. You can also take this opportunity to talk to them about your life and memories, and even pass along cherished photographs and stories.

Keep everything current.

Once you put together your estate plan, don’t just put it in that safe place and forget about it. At least yearly, perhaps on your birthday, you should revisit the documents to make sure they still reflect your intentions.

And a bonus: Get the help you need.

While there is no legal requirement that you consult an estate planning attorney, you may want to speak with an attorney to make sure you have adequately addressed all potential concerns while running through the above estate planning checklist.

I read this article at: https://www.legalzoom.com/articles/estate-planning-11-things-to-do-before-you-die?utm_source=monthlynewsletters&utm_medium=email&utm_content=2016_05_May&utm_campaign=NL_2016_05_May

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

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Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

6 Things You Should Never Let Movers Touch

6 Things You Should Never Let Movers Touch

So after years of DIY/friend-assisted moves, you’ve finally decided to hire movers. As a fellow lazy convenience-minded person, I salute you. The heavy-lifting, traffic-negotiating, stair-climbing nightmare parts of moving day are out of your hands.

But before you kick back and start daydreaming of sleeping in on the big day, I also have some bad news: There are some things you always want to move yourself.

Even if you’ve hired pros, you’re still probably going to be renting a truck or tucking a few things away in your car. Yes, I know—that completely bursts your nothing-to-do bubble. But you’ll want these things for their safe arrival.

Your pets

Obviously, you’re not going to pack Rover in a box with some air holes, but you still need to do some prep work.

Moving is stressful for pets. Add the potential danger of their busting free in the chaos of moving, and it could be a bad situation. Save yourself a headache later and pack them a travel bag now.

If you’re moving across town, plan to take water and food bowls, food, treats, an extra leash, a favorite toy, and a crate with you in the car.

If you’re moving out of state, your movers probably won’t transport your pets, but you can hire a pet-moving service.

Houseplants

Houseplants are a bigger moving-day hassle than you might realize.

First, your mover might not be able to take some of your plants, because local and interstate laws may forbid it.

“Before doing anything with houseplants, it’s good to check with your state’s Department of Natural Resources or the U.S. Department of Agriculture to make sure there aren’t any restrictions for moving that particular type of plant,” says Jonathan Deesing, a community specialist with imove.

If the plants are allowed on the truck, you’ll still have to worry about everything arriving safely.

“Only pack up plants that are hardy and can survive a bumpy ride,” he says. Fragile plants (we’re looking at you, orchids) may not survive in the back of the truck. So put them in an open box in your car with some padding to keep the pots from tipping over.

Firearms

If you’re packing, the movers probably aren’t.

Whether you’ve got an antique revolver just for display or a powerful hunting rifle, this one is a big no-no for obvious reasons.

“It’s best to move your guns on your own for safety reasons, and many moving services will not even consider moving guns for you anyway,” Deesing says.

If you’re moving your arsenal, don’t forget your safety lessons. Pack bullets and guns separately, and keep everything clearly marked and out of the reach of children.

And remember the rules and regulations.

“Make sure you have all the paperwork in order before moving guns across state lines,” Deesing says.

Your record collection and other valuables

Whether it’s the complete history of the blues on 350 vinyl records, or a collection of antique snow globes, “if you can’t stand the thought of losing it, don’t put it on a moving truck,” Deesing says.

Your moving company isn’t going to toss any of your stuff around (we hope), but accidents do happen. It’s one thing when it happens to that bookshelf you bought at Target, but another when it happens to your great-grandmother’s antique lamp set. If in doubt, bring it with you.

Personal paperwork

Pack your Social Security card, birth certificate, auto title, and any other important paperwork in a waterproof case, and haul that with you. Inevitably, something gets misplaced in a move. And it’s not helpful to find your passport six months after you had to scramble to get a last-minute replacement for your vacation to Spain.

“Of all your belongings, these can often be the most difficult to recover if lost or damaged in transit,” Deesing says.

Climate-sensitive artwork

If you’re moving across town or within the same state, your artwork can probably be safely packed and stowed away on the moving truck. If you’re moving several states away and the temperature might change drastically on the trip, you might want to bring those originals with you in your climate-controlled car.

“If you have artwork in a truck and move from the Northeast to the Deep South, it could irreversibly damage certain paints and materials,” Deesing says.

———

For everything else, follow this rule: When in doubt, overcompensate.

“Communication is key with any part of the move, and this is no exception,” Deesing says. “Don’t take risks, either—clearly label your fragile items and feel free to supervise movers as they load items onto the truck.”

I read this article at: http://www.realtor.com/advice/move/always-move-these-things-yourself/?identityID=9851214&MID=2016_0513_WeeklyNL-comafter23&RID=353497822&cid=eml-2016-0513-WeeklyNL-blog_2_dontletmoverstouch-blogs_trends

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

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Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

Housing Opportunities for Young Adults Repaying Student Debt

HAPPY 4th of July Weekend!!!!

HUD Secretary Castro, Panelists Discuss Housing Opportunities for Young Adults Repaying Student Debt

WASHINGTON (May 10, 2016) — Struggles exist for many young adults trying to become homeowners, and the burden of repaying their student loan debt is in part delaying their ability to buy, according to speakers at a regulatory issues forum on student debt and homeownership at the 2016 REALTORS® Legislative Meetings & Trade Expo.

The high-profile session discussing the impact student loan debt is having on young households’ ability to purchase homes was keynoted by U.S. Housing and Urban Development Secretary Julián Castro. During his remarks, Secretary Castro announced some of the regulatory changes coming soon to ensure housing opportunities exist for young men and women – many of whom are currently repaying the loans they borrowed to earn a college degree.

Secretary Castro began his address by saying the prescription to the American Dream has always been working hard, saving your money and investing in yourself, often by getting a great education. What has changed in recent times is that the third step – getting a great education – is more expensive than ever.

According to Castro, HUD is committed to working with its partners across the administration and in the housing community to explore additional changes that can help more Americans purchase a home. That’s why last November, Federal Housing Administration Principal Deputy Assistant Secretary Ed Golding announced changes to condo rules that would address a lengthy and complex recertification process, owner-occupancy requirements, and limits on the types of property insurance that FHA considers acceptable coverage. Secretary Castro announced that the proposed condo rule has left the HUD building and is at the Office of Management and Budget for review.

“Today’s exciting news about the big changes coming to condos are a long-fought win for Realtors®, and we’re eager to see it come to fruition,” said NAR President Tom Salomone, broker-owner of Real Estate II Inc. in Coral Springs, Florida. “Realtors® know that condos are an important option for buyers, especially for first-time buyers looking for affordable options in the marketplace.”

Secretary Castro concluded, “Realtors® help make the dream of homeownership for so many Americans a reality, and HUD is committed to partnering with them to ensure that the hard-won progress we’re seeing in our housing market continues to grow for many years to come.

A panel discussion followed consisting of Rohit Chopra, a senior official at the U.S. Department of Education; Meta Brown, senior economist at the Federal Reserve Bank of New York; NAR’s Jessica Lautz, managing director of survey research; and Mabel Guzman, chairwoman of NAR’s student loan debt work group and a Realtor® from Chicago-based real estate brokerage @Properties.

The panel participants agreed that in addition to affordability concerns, inventory shortages and lifestyle factors such as marrying later in life and having to repay student loan debt are burdening a segment of creditworthy buyers by making it more difficult to save for a down payment.

Discussing some of the ways the Education Department is working to address student loan debt, Chopra said income-based repayment options and holding student loan servicers more accountable during the repayment process will go a long way to ensuring that relief exists for those burdened by their debt. “We need to make sure the pillars of the American Dream of graduating from college and owning a home go together – and not compete with each other,” he said.

Sharing research from the New York Fed, Brown explained just how much student debt has defied the current business cycle of the past 10 years. Non-mortgage debt balances, such as debt from auto loans and credit cards, experienced a period of decline during the immediate aftermath of the Great Recession and have how either flatlined or rebounded slowly in recent years. The exception during this time has been student debt balances, which have ballooned from over $300 billion at the end of 2004 to over $1.2 trillion debt today.

Brown concluded that carrying high balances of student debt is likely leading to a growing share of young student borrowers retreating from the housing market and ultimately having to co-reside with their parents.

Pointing to NAR survey data of actual homebuyers and renters, Lautz said even with the numerous obstacles they face, millennials do make up the largest share of buyers among all generations, and over 90 percent of them currently renting have indicated a desire to become homeowners in the future.

“With home prices and rents on the rise, saving for the down payment is a challenge for many would-be buyers,” said Lautz. “Unfortunately, among other factors, repaying student debt is delaying a typical individuals’ path to homeownership by roughly five years.”

The final speaker, Guzman, said that in addition to Congress passing legislation that helps ease borrowers’ debt burden, Realtors® can play a big role by working with their young clients at the beginning stages of their housing needs, particularly during the leasing process when renting their first place.

“Realtors® can be a resourceful advocate for their young clients repaying student debt by educating them about their housing options and pointing them to credible resources, such as the Consumer Financial Protection Bureau’s information on student debt,” added Guzman. “The urge to be a homeowner is not lost among young adults, and we can all can work together early in the process to make sure they’re able to buy when they’re ready.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

I read this article at: http://www.realtor.org/news-releases/2016/05/hud-secretary-castro-panelists-discuss-housing-opportunities-for-young-adults-repaying-student-debt?om_rid=AACmlZ&om_mid=_BXOhUyB9NrAnqP&om_ntype=RESMonthly

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

‘Brexit’ Could Give U.S. Real Estate Brief Boost

I was floored when I heard the news about BREXIT – and honestly the first thing I thought of – investing in real estate. Enjoy this article….

‘Brexit’ Could Give U.S. Real Estate Brief Boost

DAILY REAL ESTATE NEWS | FRIDAY, JUNE 24, 2016

Britain’s vote yesterday to exit the European Union will likely have a long-term impact on the world economy, but in the short-term, U.S. real estate could be flooded with investors flocking to the U.S. as a safe haven, pushing up the dollar and sending down mortgage rates.

“Demand for U.S. real estate could rise,” says NAR Chief Economist Lawrence Yun.

On the commercial side, global corporations could show additional interest in U.S. real restate as they come to see the U.K. as a less certain place to set up or maintain their businesses, Yun says, “especially in London, as it becomes a less attractive place to conduct global business.”

While a rise in the dollar could hurt U.S. exports, it’s also expected to put downward pressure on long-term mortgage interest rates. “Mortgage rates will tumble,” says Greg McBride, chief financial analyst at Bankrate.com, “possibly hitting new record lows. If you’re a borrower, don’t wait to lock in your rate, as this opportunity may not last long.”

However, Fannie Mae Chief Economist Doug Duncan says low rates because of economic uncertainty could last for a while. “The Fed will very likely be on hold for some time as it observes the impact on U.S. and global financial markets and economic activity,” he says.

If mortgage rates — already at historic lows — drop even further, that could help drive up sales of all types of U.S. real estate, including on the residential side. Foreign households who might have otherwise looked to London to buy might turn to U.S. residential real estate, although U.K. citizens, who historically are among the top buyers of investment and vacation homes in the U.S., could pull back. “The British economy will be disrupted, and hence we should expect fewer Brits able to buy in the U.S.,” Yun says.

Steve Rick, chief economist at CUNA Mutual Group, was quoted in a Bankrate.com article saying a further drop in mortgage interest rates could give new life to home-mortgage refinancing, which started to cool early this year after several years of big growth. “This would create another mini refinance mortgage boom at financial institutions, as homeowners rush to lock in near-historic low interest rates,” he said.

In the long run, though, the uncertainty stemming from the vote could cause broad global weakening, which would hurt jobs, income, and consumer confidence. That would be a net-negative for U.S. real estate, even if it sees gains in the short-term.

—Robert Freedman, REALTOR® Magazine

What are your thoughts? I’d love to hear – email me at Info@TheCatonTeam.com

I read this article at: http://realtormag.realtor.org/daily-news/2016/06/24/brexit-could-give-us-real-estate-brief-boost?om_rid=AACmlZ&om_mid=_BXdXpEB9PJZQ4u&om_ntype=NARWeekly

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

On the United Kingdom’s vote to exit the European Union (a.k.a “Brexit”)

One of my lender associates sent this email and I thought I would share it with you.

On the United Kingdom’s vote to exit the European Union (a.k.a “Brexit”)

The Brexit vote is over, and 52 percent of UK citizens voted to exit the EU, leaving a lot of political and economic uncertainty in the UK, Europe and the rest of the world. The UK Prime Minister, David Cameron, has resigned and Boris Johnson is the leading candidate to replace Cameron.

We’ve addressed the potential upsides and downsides with Supreme’s Senior Vice President of Capital Markets, Steven Chiou.

Q: How will Brexit negatively impact economics globally?

A: Forty-four percent of UK exports go to EU countries. Those exports may now be subject to heavy tariffs and more restrictions. This means the UK’s GDP for 2016 may be now down to zero and GDP for the EU may be lowered by .25 to .50 for 2016. Stock markets plunged today while investors sold stocks and moved money into safe-haven US Treasury Bonds or Mortgage Backed Securities (MBS).

Q: Should we be concerned about global economic stability?

A: All central banks in the world have committed to providing liquidity to calm financial markets. This exit will also be a two year process, so change should come more slowly, not suddenly.

Q: What does the dip in the stock market mean for the mortgage industry?

A: The 10 year treasury gained 1.625 points in price and 30 year MBS current coupons gained .625 percent. Supreme’s rate sheet price improved from .50 percent to .75 percent this morning.* Essentially, this occurrence is favorable for the bond market and mortgage business, as the rates are going to stay low for a while.

*For consumers, it’s an opportune moment to buy that dream home, or refinance loans for a better rate.

Please feel free to reach out with any questions or updates with any clients you would like me to work on!

Michael Haigh

Branch Manager – NMLS# 200819

415.269.4461 (cell)

Thank you for reading… For all your Real Estate needs call The Caton Team

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: https://www.linkedin.com/in/sabrinawendtcaton

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

Despite Money Issues, Millennials Want to Buy

Despite Money Issues, Millennials Want to Buy

Millennials have a lower net worth than their parents did at their age, and a lack of money coupled with student loan debt continues to be a roadblock to home ownership for this generation, according to Paul Taylor, executive vice president of the Pew Research Center and author of the book “The Next America: Boomers, Millennials, and the Looming Generational Showdown.”

Taylor presented his findings at the REALTORS® Legislative Meetings & Trade Expo in Washington, D.C. last week. Among them, households headed by an individual under the age of 35 had a median net worth of $15,260 in 1983, as compared to $10,460 in 2013. However, wealth has significantly increased over that time period for those 65 and over. Median net worth for that age group was $210,500 in 2013, up nearly $100,000 from $120,524 in 1983.

The financial situation of the millennial generation is reflected in the real estate industry. Historically, first-time buyers have accounted for about 40 percent of total home buyers annually, but that figure has trended downward since 2011 to 32 percent today. It’s not surprising, Taylor said, as a record number of young people are strapped with student debt. This trend has also led to 39 percent of millennials currently living with their parents.

“These shifts are creating big generation gaps that will put stress on our families, our politics, our pocketbooks, our entitlements programs, and perhaps our social cohesion,” Taylor said.

Jessica Lautz, managing director of survey research at the National Association of REALTORS®, agreed that the major hurdles to home buying for people under the age of 35 includes flat wages, rising rents, and student loan debt. The 2016 Profile of Generation Trends shows that one in six younger baby boomers purchased a multi-generational home to accommodate their own aging and returning children.

But the vast majority of millennials are optimistic about home buying, Lautz said. In fact, 94 percent of millennial renters say they want to own, according to a recent NAR survey. And what they’re looking for is affordability in first-ring suburbs with shorter commutes and good schools.

What’s more, 87 percent of millennials who bought a home in 2015 used a REALTOR®, Lautz said. “Not having been through the process before, they rely on real estate agents to get them through the competitive market and to the finish line,” she added.

Despite major economic changes affecting this generation, one thing has stayed the same: the median age of a first-time buyer still hovers at 31.

“This means that they are ready and willing to buy if they can, in fact, break into the market,” Lautz said. “It’s getting more difficult to get to that point, but the desire to do so hasn’t changed.”

—Erica Christoffer, REALTOR® Magazine

I read this article at: http://realtormag.realtor.org/daily-news/2016/05/16/despite-money-issues-millennials-want-buy?om_rid=AACmlZ&om_mid=_BXOjTSB9NnyKc0&om_ntype=RMODaily

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

3 Questions You Should Ask Yourself Before Ever Taking A Loan

Saving money is hard! We know! Most of us already have student debt, or other things going on and could never get enough money together to get the things we need, and that’s often where a loan comes in.

We know Career Girls who have taken loans out with the bank for everything from degrees to cars, so here are a few things to keep in mind if you’re considering it.

1) Be sure that you really need a loan!

You may want a new car, but you may not need it. You may want a new house, but you may not need it. Sure, there are situations in life when it’s absolutely okay to take a loan for a house or a car, but there are also situations when it’s better to think twice. If you have to stay with your parents for an extra year – do it.

2) Calculate, calculate, calculate!

In the end, a loan is all about mathematics, so here is the one question you should definitely answer before taking the step: When will I be able to repay the loan? And, perhaps more importantly: Is it a problem for me to live with a loan for such a long time?

3) Understand your loan!

There are many different loans depending on what you need it for. Don’t sign the paper without knowing what you’re getting yourself into, collect as much information possible about the loan you’re deciding on and stay away from money lending services with super inflated interest rates!

I read this article at: http://www.careergirldaily.com/3-things-keep-mind-taking-loan/

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

5 Things I Have Learned From Buying A House

I truly enjoy sharing articles that relate to Real Estate. Especially when lessons can be learned from others. I’ve added my 2 cents in italics – Enjoy this one about Buying a Home….

Thanks for reading – Sabrina

5 Things I Have Learned From Buying A House

Owning your own place is the ultimate goal. But you know what? It isn’t easy. You need to be on the ball and know exactly what you are getting into.

Here are my top 5 tips from my own personal experience.

You need way more money than just the deposit!

It’s easy to just think about the deposit, that magic number of 10 or 20% can become something to be obsessed with. Working hard, cutting the spends and being frugal all help to get towards that goal. But oh god you need way more money than that! There’s furniture to buy, legal costs, removal costs, painting and decorating. There are heaps of extra expenses that you don’t really think about, but they can bite pretty hard!

Indeed saving for the downpayment is the biggest hurdle to homeownership. And you also needs funds for closing costs and as this article shared – moving and renovation expenses. Maybe the home just needs paint and carpet – but that cost money too. So make it a point to save save save more than just that downpayment. Also – there are home loans that do not require 20% down and there are also home loans to help you renovate a property – contact The Caton Team and we can help you.

The photos are always deceptive.

Not a shocker, but totally true. Far too many times to count I wasted a Saturday morning looking at a house that looked fab in the pictures and horrific in reality! Estate agents will take photos from all the good angles; meaning you don’t see that large patch of damp or that awful bathroom suite until you have laid eyes on it in person. It’s frustrating, but you know what? It’s a positive thing, you will be more confident when viewing other properties and get a sense of the home you really want to own!

Now now now – as a Professional Realtor I am NOT trying to deceive anyone with fabulous photos. It is our job to the seller to present the home in the best light. However, I am so over virtual tours – honestly – think about it – are you virtually going to live in a home? NO! So get up and go see the house in person. I also think it is imperative for my buying clients to drive themselves to the open house – because sitting in my back seat – some clients do not see the neighborhood and location is just as important – if not more important than the home itself.

You will know the right house!

Sounds a little cheesy but when you know, you know! I knew the second I walked in; I just got an amazing feeling and it ticked all the boxes. Good area, great transport links and some awesome restaurants and cafés nearby. Of course, you need to make sure everything checks out but definitely trust your gut.

This I whole heartedly agree with. You know when you found the one – now it’s time to write an amazing offer. The hard part here in the San Francisco Bay Area is competition. You may have found the one – and so has someone else. So it’s important to go in with your best offer. And it is just as important to get back up on the horse if you don’t get it.

You will need to be super organized.

There will be heaps to organize, so grab that planner and start making notes. You will need to arrange viewings, mortgage advice, packing, lawyers and the rest. Start early and chase people regularly for a response; don’t be afraid to get on the phone to get stuff sorted! Be pro-active; the sooner things progress the sooner the keys will be in your hand.

Even though I am the Realtor professional – this is your home, your goals and we need you to be just as organized and on top of emails and calls as we are. Realtors are not a part of the transaction – we are facilitators and here to help you. Having your ducks in a row makes the entire process much easier for all of us.

It’s incredibly stressful.

Purchasing a property is really stressful; I had to get all sorts of reports and then needed to renegotiate the price, so what should have been a straightforward transaction soon dragged out. People can get wound up when there is so much money involved, but stick with it and keep the end goal in sight.

It is a lot to take on board and a major life event, but you know what, it’s totally worth it; that feeling of closing the door behind you knowing you own you own home is hard to beat. Obviously, the responsibility is unreal; the mortgage needs to get paid and if anything goes wrong you can’t just simply turn to your landlord to sort it out, but finally getting on the property ladder will be a total game changer.

I hate to say it but yes buying a home is stressful. The Caton Team tries their best to make the process as easy as possible – but things pop up and in this highly competitive market – a buyer may be writing offers on a weekly basis until they do get a home. Hard on the buyer and hard on the Realtor. But The Caton Team loves what we do and go the extra mile to make this processes as easy as possible.

If you have any questions about buying a home – please feel free to contact The Caton Team – info@TheCatonTeam.com or call at 650.568.5522 (no text on this line). THANK YOU!

I read this article at: http://www.careergirldaily.com/5-things-i-learned-buying-house/

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

What do Real Estate Agents do? About 184 things to be exact…

184 Things Realtors Do for Their Real Estate Clients (and they don’t even know it)

“Why do I need you?”

This is a question many real estate agents dread. But with the rise of real estate technology that puts more market data into the hands of buyers and sellers, more agents have to come up with an answer.

In fact, Adwerx CEO Jed Carlson gave a speech about it.

Pat Vredevoogd-Combs, past president of the National Association of REALTORS® in 2007, testified before the House Financial Services Committee on Housing to blunt government complaints about industry pricing.

As part of her testimony, she submitted a list of 184 things that listing agents do in every real estate transaction.

“By all accounts,” she said, “the general public is not aware of all the services that agents provide to sellers and buyers during the course of the transaction, probably because most of the important services are performed behind the scenes.”

This list has appeared in several places across the web, but it’s such a powerful and comprehensive collection of little-known services, we wanted to capture it and create a version you could use with your own client conversations — helping your sellers understand the critical role you play in their real estate transaction.

Pre-listing activities

Make appointment with seller for listing presentation.
Send a written or e-mail confirmation of appointment and call to confirm.
Review appointment questions.
Research all comparable currently listed properties.
Research sales activity for past 18 months from MLS and public databases.
Research “average days on market” for properties similar in type, price and location.
Download and review property tax roll information.
Prepare “comparable market analysis” (CMA) to establish market value.
Obtain copy of subdivision plat/complex layout.
Research property’s ownership and deed type.
Research property’s public record information for lot size and dimensions.
Verify legal description.
Research property’s land use coding and deed restrictions.
Research property’s current use and zoning.
Verify legal names of owner(s) in county’s public property records.
Prepare listing presentation package with above materials.
Perform exterior “curb appeal assessment” of subject property.
Compile and assemble formal file on property.
Confirm current public schools and explain their impact on market value.
Review listing appointment checklist to ensure completion of all tasks.

Listing appointment presentation

Give seller an overview of current market conditions and projections.
Review agent and company credentials and accomplishments.
Present company’s profile and position or “niche” in the marketplace.
Present CMA results, including comparables, solds, current listings and expireds.
Offer professional pricing strategy based and interpretation of current market conditions.
Discuss goals to market effectively.
Explain market power and benefits of multiple listing service.
Explain market power of Web marketing, IDX, and REALTOR.com.
Explain the work the broker and agent do “behind the scenes” and agent’s availability on weekends.
Explain agent’s role in screening qualified buyers to protect against curiosity seekers.
Present and discuss strategic master marketing plan.
Explain different agency relationships and determine seller’s preference.
Review all clauses in listing contract and obtain seller’s signature.

After listing agreement is signed

Review current title information.
Measure overall and heated square footage – here is California we are not supposed to measure
Measure interior room sizes – here is California we are not supposed to measure
Confirm lot size via owner’s copy of certified survey, if available.
Note any and all unrecorded property lines, agreements, easements.
Obtain house plans, if applicable and available.
Review house plans, make copy.
Order plat map for retention in property’s listing file.
Prepare showing instructions for buyers’ agents and agree on showing time with seller.
Obtain current mortgage loan(s) information: companies and account numbers.
Verify current loan information with lender(s).
Check assumable loan(s) and any special requirements.
Discuss possible buyer financing alternatives and options with seller.
Review current appraisal if available.
Identify Homeowner Association manager is applicable.
Verify Homeowner Association fees with manager–mandatory or optional and current annual fee.
Order copy of Homeowner Association bylaws, if applicable.
Research electricity availability and supplier’s name and phone number.
Calculate average utility usage from last 12 months of bills – here is California we do not do this since it is so subjective to each buyers needs
Research and verify city sewer/septic tank system.
Calculate average water system fees or rates from last 12 months of bills – here is California we can ask for copies of past bills – but usage is subjective.
Or confirm well status, depth and output from Well Report.
Research/verify natural gas availability, supplier’s name and phone number.
Verify security system, term of service and whether owned or leased.
Verify if seller has transferable Termite Bond.
Ascertain need for lead-based paint disclosure.

Prepare detailed list of property amenities and assess market impact.
Prepare detailed list of property’s “Inclusions & Conveyances with Sale.”
Complete list of completed repairs and maintenance items.
Send “Vacancy Checklist” to seller if property is vacant.
Explain benefits of Homeowner Warranty to seller.
Assist sellers with completion and submission of Homeowner Warranty application.
When received, place Homeowner Warranty in property file for conveyance at time of sale.
Have extra key made for lockbox.
Verify if property has rental units involved. And if so:
Make copies of all leases for retention in listing file.
Verify all rents and deposits.
Inform tenants of listing and discuss how showings will be handled.
Arrange for yard sign installation.
Assist seller with completion of Seller’s Disclosure form.
Complete “new listing checklist.”
Review results of Curb Appeal Assessment with seller and suggest improvements for saleability.
Review results of Interior Decor Assessment and suggest changes to shorten time on market.
Load listing time into transaction management software.

Entering property in MLS database

Prepare MLS Profile Sheet–agent is responsible for “quality control” and accuracy of listing data.
Enter property data from Profile Sheet into MLS listing database.
Proofread MLS database listing for accuracy, including property placement in mapping function.
Add property to company’s Active Listings.
Provide seller with signed copies of Listing Agreement and MLS Profile Data Form within 48 hours.
Take more photos for upload into MLS and use in flyers. Discuss efficacy of panoramic photography.

Marketing the listing

Create print and Internet ads with seller’s input.
Coordinate showings with owners, tenants and other agents. Return all calls–weekends included.
Install electronic lockbox. Program with agreed-upon showing time windows.
Prepare mailing and contact list.
Generate mail-merge letters to contact list.
Order “Just Listed” labels and reports.
Prepare flyers and feedback forms.
Review comparable MLS listings regularly to ensure property remains competitive in price, terms, conditions and availability.
Prepare property marketing brochure for seller’s review.
Arrange for printing or copying of supply of marketing brochures or flyers.
Place marketing brochures in all company agent mailboxes.
Upload listing to company and agent Internet sites, if applicable.
Mail “Just Listed” notice to all neighborhood residents.
Advise Network Referral Program of listing.
Provide marketing data to buyers from international relocation networks.
Provide marketing data to buyers coming from referral network.
Provide “Special Feature” cards from marketing, if applicable.
Submit ads to company’s participating Internet real estate sites.
Convey price changes promptly to all Internet groups.
Reprint/supply brochures promptly as needed.
Review and update loan information in MLS as required.
Send feedback e-mails/faxes to buyers’ agents after showings.
Review weekly Market Study.
Discuss feedback from showing agents with seller to determine if changes will accelerate the sale.
Place regular weekly update calls to seller to discuss marketing and pricing.
Promptly enter price changes in MLS listings database.

The offer and the contract

Receive and review all Offer to Purchase contracts submitted by buyers or buyers’ agents.
Evaluate offer(s) and prepare “net sheet” on each for owner to compare.
Counsel seller on offers. Explain merits and weakness of each component of each offer.
Contact buyers’ agents to review buyer’s qualifications and discuss offer.
Fax/deliver Seller’s Disclosure to buyer’s agent or buyer upon request and prior to offer if possible.
Confirm buyer is pre-qualified by calling loan officer.
Obtain pre-qualification letter on buyer from loan officer.
Negotiate all offers on seller’s behalf, setting time limit for loan approval and closing date.
Prepare and convey any counteroffers, acceptance or amendments to buyer’s agent.
Fax copies of contract and all addendum to closing attorney or title company – we email now…
When Offer-to-Purchase contract is accepted and signed by seller, deliver to buyer’s agent.
Record and promptly deposit buyer’s money into escrow account.
Disseminate “Under-Contract Showing Restrictions” as seller requests.
Deliver copies of fully signed Offer to Purchase contract to sellers.
Fax/deliver copies of Offer to Purchase contract to selling agent.
Fax copies of Offer to Purchase contract to lender.
Provide copies of signed Offer to Purchase contract for office file.
Advise seller in handling additional offers to purchase submitted between contract and closing.
Change MLS status to “Sale Pending.”
Update transaction management program to show “Sale Pending.”
Review buyer’s credit report results–Advise seller of worst and best case scenarios.
Provide credit report information to seller if property is to be seller-financed.
Assist buyer with obtaining financing and follow up as necessary.
Coordinate with lender on discount points being locked in with dates.
Deliver unrecorded property information to buyer.
Order septic inspection, if applicable.
Receive and review septic system report and access any impact on sale.
Deliver copy of septic system inspection report to lender and buyer.
Deliver well flow test report copies to lender, buyer and listing file.
Verify termite inspection ordered.
Verify mold inspection ordered, if required.

Tracking the loan process

Confirm return of verifications of deposit and buyer’s employment.
Follow loan processing through to the underwriter.
Add lender and other vendors to transaction management program so agents, buyer and seller can track progress of sale.
Contact lender weekly to ensure processing is on track.
Relay final approval of buyer’s loan application to seller.

Home inspection

Coordinate buyer’s professional home inspection with seller.
Review home inspector’s report.
Enter completion into transaction management tracking software program.
Explain seller’s responsibilities of loan limits and interpret any clauses in the contract.
Ensure seller’s compliance with home inspection clause requirements.
Assist seller with identifying and negotiating with trustworthy contractors for required repairs.
Negotiate payment and oversee completion of all required repairs on seller’s behalf, if needed.

The Appraisal

Schedule appraisal.
Provide comparable sales used in market pricing to appraiser.
Follow up on appraisal.
Enter completion into transaction management program.
Assist seller in questioning appraisal report if it seems too low.

Closing preparations and duties

Make sure contract is signed by all parties.
Coordinate closing process with buyer’s agent and lender.
Update closing forms and files.
Ensure all parties have all forms and information needed to close the sale.
Select location for closing.
Confirm closing date and time and notify all parties.
Solve any title problems (boundary disputes, easements, etc.) or in obtaining death certificates.
Work with buyer’s agent in scheduling and conducting buyer’s final walkthrough prior to closing.
Research all tax, HOA, utility and other applicable prorations.
Request final closing figures from closing agent (attorney or title company).
Receive and carefully review closing figures to ensure accuracy.
Forward verified closing figures to buyer’s agent.
Request copy of closing documents from closing agent.
Confirm the buyer and buyer’s agent received title insurance commitment.
Provide “Home Owners Warranty” for availability at closing.
Review all closing documents carefully for errors.
Forward closing documents to absentee seller as requested.
Review documents with closing agent (attorney).
Provide earnest money deposit from escrow account to closing agent.
Coordinate closing with seller’s next purchase, resolving timing issues.
Have a “no surprises” closing so that seller receives a net proceeds check at closing.
Refer sellers to one of the best agents at their destination, if applicable.
Change MLS status to Sold. Enter sale date, price, selling broker and agent’s ID numbers, etc.
Close out listing in transaction management program.

Follow-up after closing

Answer questions about filing claims with Homeowner Warranty company, if requested.
Attempt to clarify and resolve any repair conflicts if buyer is dissatisfied.
Respond to any follow-up calls and provide any additional information required from office files.

And that’s just when we Realtors represent the Seller. I may have to write my own blog on what The Caton Team does when we represent Buyers! I hope this sheds some light on what we do. If you have questions – ask me!

I read this article at: http://www.retechnology.com/agent/articles/184-things-you-do-for-real-estate-clients-and-they-don-t-even-know-it?layout=onepage&utm_campaign=top520160522&utm_medium=email&utm_source=newsletter_33651

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

Want Real Estate Info on the Go? Download our FREE Real Estate App: http://thecatonteam.com/mobileapp

Visit our Website at: http://thecatonteam.com/

VISIT OUR INSTAGRAM PAGE: http://instagram.com/thecatonteam

Visit us on Facebook: http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me: http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn: http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

Zillow CEO Spencer Rascoff sold home for much LESS than his own Zestimate!!!!!

You know we Realtors out there are thrilled with this news story. After so many difficult conversations explaining why a zestimate is not accurate – for the CEO to sell his home below his own zestimate – well it does leave us smiling ear to ear. There is a reason why online, automated home values do not work. In theory – they are a great tool and should work. But in actuality – they are often very inaccurate and set the bar for disappointment. If you are curious about the worth of your home, contact your Realtor – or The Caton Team. We’d be happy to prepare a custom, accurate and local snapshot of what your home is worth in today’s dynamic Real Estate market. Thank you for reading – Sabrina 650.586.5522 info@TheCatonTeam.com

Zillow CEO Spencer Rascoff sold home for much less than Zestimate

Clients putting Zestimates on a pedestal? Point them toward this sale

Key Takeaways

Agents can demonstrate the Zestimate’s shortcomings by showing the discrepancy between the sales price of a home formerly owned by Zilow CEO Spencer Rascoff and its Zestimates.
Luxury home Zestimates are more likely to be off than others due to ‘non-quantifiable facts.’
Irregular lot sizes or proximity to ‘arterial’ roads can sometimes throw off Zestimates.

Zillow CEO Spencer Rascoff may have recently given real estate agents a gift they won’t soon forget: a sure-fire way to show that Zestimates can miss by a mile.

How? By selling a property for much less than its Zestimate.

On February 29, Rascoff sold a Seattle home for $1.05 million, 40 percent less than the Zestimate of $1.75 million shown on its property page a day later.

The gap between the Zestimate of Rascoff’s former property and its sales price has decreased only modestly since then.

Zillow readily acknowledges that Zestimates can be inaccurate, but some consumers can still take them at face value, causing headaches for agents.

Citing the chasm between the sales price of Rascoff’s former home and the property’s Zestimate may be one way for real estate professionals to show clients that Zestimates are, as Zillow says, only a conversation starter for pricing a home, not the final word on its value.

Zillow CEO sold his home for way less than Zestimate.

Philip Gray, a San Leandro, California-based appraiser, is taking this approach. Bringing up the Zestimate of the property Rascoff recently offloaded will help him deal with the frequent pushback he receives from homeowners “who think Zillow is the magic 8-ball,” he said.

‘We missed’

Zestimates on Rascoff’s former home have certainly been overstating the property’s value, said Zillow Chief Analytics Officer Stan Humphries.

“The fact that we missed and there are empirical reasons we missed — that’s a great conversation that real estate agents should have” with consumers, he said, citing the property’s irregular lot and location on a busy road as partly responsible for its Zestimate’s inaccuracy.

But he expressed hope that, in the same discussion, agents also won’t instill “data nihilism” in consumers, and that they acknowledge that humans also can miss the mark.

Smaller gap at start

In July, the Zestimate of Rascoff’s former property wouldn’t have raised the eyebrows of anyone who’s familiar with automated valuation models (AVMs). At $1.388 million, the property’s Zestimate was 7.3 percent higher than its listing price of $1.295 million at the time.

Since Zillow only shows revised historical Zestimate data on property pages, the home’s property page currently indicates that the property’s Zestimate was around $1.6 million in July 2015, somewhere in the neighborhood of $200,000 more than the Zestimate that actually appeared on its property page on July 17, 2015. For all anyone knew in July 2015, the property might have eventually sold at a price closer to its Zestimate than its listing price.

But that didn’t happen. The home later sold for $1.05 million, 19 percent below its July listing price. Undergoing a number of price cuts, the property was listed and de-listed several times between when it was originally listed on July 7, 2015 and when it sold on February 29, 2016.

If Rascoff thought his home was worth its July listing price, the outcome of the sale might have come as a disappointment. But if the success of the transaction were judged by the property’s Zestimate, it was a failure.

The home’s Zestimate was $1,750,405 on March 1, the day after the property sold for $1,050,000.

If that Zestimate were accurate, it would mean the chief of the biggest name in real estate and the recent co-author of a book about “the new rules of real estate” would have sold his home for 40 percent less than it was worth.

Automated valuations vary

In addition to highlighting the shortcomings of Zestimates, the Zestimate of Rascoff’s home also brings into focus the potential for some automated valuations to be more accurate than others.

Unlike Zillow’s property page on the home the day after it sold, Redfin’s page on the home showed that the sale had occurred. At the time, it displayed a valuation of $1.1 million — much closer to the property’s sales price of $1.05 million.

On Thursday, May 5, Redfin’s estimate of the home’s value was $1.3 million.

So while Zillow’s estimate had come down by around $140,000 since the home sold, Redfin’s had increased by about $200,000. Both differed from the price the home sold for a little over two months ago by hundreds of thousands of dollars.

Zillow has since added the sales price of Rascoff’s former home to its property page.

The property’s Zestimate had slipped from $1,750,405 the day after it sold to $1,608,670 on May 5, but its Zestimate on May 5 still only represented 65 percent of what the home sold for a little over two months before.

To judge the Zestimate’s accuracy based solely on the gap between the sales price of Rascoff’s former home and its Zestimate would probably be unfair. The discrepancy is unusually wide, according to what Zillow says is the Zestimate’s median error rate.

Zillow puts the Zestimate’s national median error rate at 7.9 percent, meaning half of Zestimates nationwide are within 7.9 percent of a home’s sales price and half are off by more than 7.9 percent. The listing portal claims an even higher level of accuracy in Seattle, where Rascoff’s former home is located.

There, Zestimates for half of homes are supposed to be within 6.1 percent of their sales price, while half are supposed to be off by more than 6.1 percent. This suggests that the Zestimate of Rascoff’s home missed by much more than normal in Seattle.

Why was that?

One reason is that the home’s Zestimate was comparing Rascoff’s former home, which is located on a triangular lot, to recently sold homes located on rectangular lots, according to Humphries.

Since rectangular lots provide more utility than triangular lots, he said, that meant the Zestimate was overvaluing the plot of Rascoff’s home.

Another reason was that Rascoff’s home was located on an “arterial” road while nearby recently sold homes sat on quieter streets.

Zillow continues to research how to program Zestimates to account for such factors, but “we haven’t fully cracked the nut on that one” yet, Humphries said.

‘The classic luxury homes problem’

Zillow Senior Economist Skylar Olsen added that the Zestimate of Rascoff’s home represents “the classic luxury homes problem.”

Zestimates can’t take into account “non-quantifiable facts,” such as layout design or lighting, and these facts can have much more of an effect on the values of luxury homes than less expensive properties, she said.

Real estate agents can see how special features impact a property’s value, but the “Zestimate algorithm can’t know” and “at this point in time, it’s not designed to know,” she said.

The reason why the Zestimate of Rascoff’s former property hasn’t dropped dramatically since selling at a much lower price than Zestimates leading up to the sale is that the Zestimates have a “smoothing function” designed to keep them from overreacting to recent property sales.

The Zestimate on the Rascoff’s former property will gradually come down to more closely resemble its sales price. And upcoming updates to the Zestimate’s algorithms will adjust the smoothing function so that the Zestimate of a home that sells will come to more closely mirror its sales price much faster.

Also worth noting is that Zillow does not have access to sold listing data from the Northwest Multiple Listing Service, the MLS that covers Seattle. Automated valuation models (AVMs) that crunch sold MLS data can have an advantage over AVMs that only use public sales records — which are the only sales records used by Zestimates covering Seattle.

While Zillow says on its website that most consumers understand that Zestimates truly are only estimates, the listing portal concedes that, sometimes, “someone will come along that insists on setting the price they are willing to buy or sell for based solely on the Zestimate.”

Zillow goes on to say that “education is the key” and that, armed with knowledge of how Zestimates are calculated along with their local median error rate, agents can explain “why the Zestimate is a good starting point as well as a historical reference, but it should not be used for pricing a home.”

While Zestimates can create hassles for agents, some agents would certainly agree with Zillow’s assertion that understanding how a Zestimate is calculated, along with its strengths and weaknesses, “can provide the real estate pro with an opportunity to demonstrate their expertise.”

The gap between the Zestimate of Rascoff’s former property and its sales price may have made it easier for agents to seize that opportunity.

Zillow’s Humphries’ hopes that, when putting Zestimates in perspective for consumers, agents will also acknowledge that Zestimates do have a scientific basis, and that nobody’s perfect — even trained professionals.

He noted that a study released by Zillow in 2012 showed that the typical gap between a home’s Zestimate and its sales price wasn’t that much larger than the typical gap between a home’s initial list price — which is often set based on a real estate agent’s recommendation — and its sales price.

“We acknowledge humans are great at this, and we’re great too — but they’re greater,” Humphries said.

I read this article at: https://www.inman.com/2016/05/18/zillow-ceo-spencer-rascoff-sold-home-for-much-less-than-zestimate/?utm_source=20160521&utm_medium=email&utm_campaign=weeklyheadlines

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