Tag: Redwood City

Open House Saturday 1:30-4:30 – 25 Southgate Street in Redwood City

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Open Saturday March 22, 2014 from 1:30-4:30 by The Caton Team

From curb appeal to the interior this charming 3 bedroom home boasts timeless architecture & design elements built in 1937 on a 7800 SF lot and offering 1420 SF of living space Natural light beautiful beam ceiling refinished hardwood floors elegant trim and molding freshly painted good sized remodeled kitchen w/granite counters and breakfast bar formal living room w/fireplace separate dining room

Offered at $998,000 by Diane Viviani with Prudential California Realty
25 Southgate Street Redwood City CA

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

Email Sabrina & Susan at:  Info@TheCatonTeam.com

Call us at: 650-568-5522  Office:  650-365-9200

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Please enjoy my personal journey through homeownership at:

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Thanks for reading – Sabrina

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

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

Is Market Recovery Slowing Down? Great Article from SF Gate

Great article about our local Real Estate market – is recovery slowing down?  Or is supply holding back the reins?

Signs of possible slowdown in housing recovery


By: Kathleen Pender, San Francisco Chronicle & SF Gate

Bay Area home prices rose on a year-over-year basis last month, albeit at a slower pace than earlier in the year, while sales fell to their slowest pace for a December since 2007, DataQuick reported Wednesday.

It was another sign of a potential slowdown in the housing recovery.

On Tuesday, the Mortgage Bankers Association lowered its forecast for 2014 mortgage originations, citing higher interest rates and uncertainty over new mortgage rules that took effect this month.
DataQuick attributed the sales slowdown to a lack of supply, not a lack of demand.
“Demand has been impacted by a roughly one percentage point increase in rates since spring. But we think the bigger deal is the lack of inventory,” DataQuick spokesman Andrew LePage says.
In the Bay Area, 6,714 new and resale houses and condos were sold in the nine counties last month. That was up 0.8 percent from November but down 12.7 percent from December 2012.
Sales are typically higher in December than November, but the seasonal increase is normally much higher – around 8 percent.
The December sales figure was the lowest for a December since 2007, when 5,065 homes sold.
The median price paid for a Bay Area home last month was $548,500. That was down 0.3 percent from November, but 23.9 percent higher than the same time last year. From April through August last year, prices rose 30 percent or more on a year-over-year basis.
More sales in spring

LePage says there will be more homes on the market in spring and summer, when the market typically heats up. Rising home prices will leave fewer homes underwater, so more homeowners will sell because they could make enough to pay off their mortgage. Also, there has been “a little more construction,” LePage says.
“Waiting (to buy a home) will get you more choice, but all bets are off on prices,” he says.
If the current rate of appreciation holds, “the typical home would be selling for $50,000 to $60,000 more by spring.

Perhaps twice that at the upper end of the market,” DataQuick President John Walsh said in a news release.

Tight inventories are also hurting the mortgage industry.

In its forecast Tuesday, the Mortgage Bankers Association predicted that only $1.12 trillion in home loans will be originated this year, down 36 percent from $1.76 trillion in 2013. In October, it predicted that 2014 originations would drop by only 32 percent.

The forecast came out hours after mortgage heavyweights Wells Fargo and Chase announced big drops in fourth-quarter mortgage originations as part of their earnings reports.

The numbers “just kept getting worse through the end of 2013,” says Michael Fratantoni, the association’s chief economist.

The association predicts that home-purchase mortgages will rise just 3.8 percent to $677 billion this year. In October, it was expecting a 9 percent increase.

Refinance originations, it says, will hit only $440 billion, down 60 percent form last year. In October it expected a 57 percent drop.

Higher rates a drag

The main culprit is higher interest rates. Mortgage rates were around 3.5 percent at the beginning of last year but jumped by a full percentage point in May and June. They have been hovering around 4.5 percent since then.

The immediate effect was to slash refinance volume, but home-purchase originations also suffer from a low-rate “hangover,” Fratantoni says. The ultra-low rates that persisted before May “pulled forward some (purchases) that might not have occurred until six months or a year later. Now we are now we are seeing a bit of a payback in terms of lower activity.”

The association predicts that the average 30-year mortgage rate will be above 5 percent by the end of this year and above 5.5 percent at the end of next year.

It also predicts that fewer mortgages could be made this year as lenders narrow their product lineup to conform with the new mortgage rules designed to outlaw some of the abusive lending practices that led to the financial crisis.

The new rules give lenders some protection from borrower lawsuits if they make what is known as a qualified mortgage and the loan goes bad. A loan is not qualified if it has certain features, such as interest-only payments, or if the borrower’s total debt payments (including the mortgage and other debt) exceed 43 percent of gross income.
Over government limit

The new rules apply only to jumbo and other nonconforming mortgages, because all loans that could be bought or backed by Fannie Mae, Freddie Mac, the Federal Housing Administration and other government agencies are automatically deemed qualified.

Government loans account for the vast majority of the mortgages nationwide but a smaller percentage in the Bay Area, where many borrowers exceed the government limit, which tops out at $625,500 for Fannie, Freddie and FHA loans in high-cost areas.

In the Bay Area, 15.4 percent of home-purchase loans exceeded $625,500 in the fourth quarter, but this number ranged from less than 0.4 percent in Solano County to 32 percent in San Francisco, according to DataQuick.

Kathleen Pender is a San Francisco Chronicle columnist. Net Worth runs Tuesdays, Thursdays and Sundays. E-mail: kpender@sfchronicle.com Blog: http://blog.sfgate.com/pender Twitter: @kathpender

I read this article at: http://www.sfgate.com/business/networth/article/Signs-of-possible-slowdown-in-housing-recovery-5146631.php
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 Office: 650-365-9200

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 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

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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

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

The Importance of Working with a Good Lender

The Importance of Working with a Good Lender – by Sabrina

Buying a home is serious business; especially on the San Francisco Peninsula where even a one bedroom condo can run about half a million bucks.

And in an industry where time is money and money talks, from time to time I will encounter a lender – that offers great rates and low fees – upfront.  And no customer service when you really need it.

Much too often a buyer is tempted to get the best rate – without really considering the whole picture.

Unless you are paying cash – the home loan is the most important aspect of buying a home – aside from the home itself.

So when taking into account that a home is generally the largest purchase of a person’s life – shouldn’t we work with a bank that treats it with the same respect?  YES!

There are hundreds of steps from finding the home to getting the keys.  The loan is probably the largest hurdle aside from home inspections.

Once a buyer’s contract is accepted by the seller – it’s rush time.  Most offers have a time frame – called a contingency period – to have the bank do their appraisal and have the loan/purchase terms reviewed and approved by underwriting.  It can be as long as 17 days in a buyers market – or as short as 5 days in a sellers market.  And this is where we separate the men from the boys.  Some of these out of state or on-line lenders are not located here – where one is buying – and it can be extremely difficult to get information and approvals done when they close shop at 5pm and it’s only 2pm here!

That friendly voice that quoted a buyer a fantastic rate isn’t calling us back anymore…..and when they do it’s often not what we were hoping to hear.  For example, they need more time to review the file – therefore we need to push back the close of escrow date – which seems easy – but again – time is money.   The seller is expecting the buyer to perform to the terms of the contract and it’s not worth losing a home due to a lackluster lender…..and changing lenders mid way is generally not an option.

So – what can a buyer do to be competitive?  Work with a local lender.  Once your credit is pulled the first time – a consumer has 30 days to loan shop without hurting their credit score.  So do it!  Loan shop the whole month and find the best rate, the best fees and make sure the lender is attentive, local and can move at the pace the current market is dictating.

The Caton Team has a list of Client Approved Lenders – so please reach out to us and we’ll introduce you to the team.

Got Questions? – The Caton Team is here to help.  What can we do for you?

Email Sabrina & Susan at:  Info@TheCatonTeam.com

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Please enjoy my personal journey through home ownership at:

http://ajourneythroughhomeownership.wordpress.com/

Thanks for reading – Sabrina

6 Wills, Won’ts and Worries of 2013 Home Buyers…. great article – had to share…

When I read this – I just had to share….

 

6 Wills, Won’ts and Worries of 2013 Home Buyers

 

Trulia Article By Tara-Nicholle Nelson

If you’ve ever taken up running, you might know what it’s like to strap on your new shoes, head over to the track and take those first few strides, then feel a pain in your chest, heaviness in your feet and possibly, actually see stars. Maybe your last steps off the track were accompanied by the thought process: “Either I’m crazy, or runners are.”

Until you have talked to a legitimate, dyed in the wool runner and told them your story, explaining why you detest running with every iota of your being you won’t know the runner’s secret: everyone feels that way at first. It’s the normal physiological adjustment to the increased load you’re putting on your cardiovascular and musculoskeletal systems, this pain you felt when you took those first few steps.  It goes away in just a moment, if and only if you keep on running.

Sometimes, knowing that others react to a tough situation by feeling the same emotions, thinking the same thoughts, or doing the same things you do flat out helps you feel less crazy, panicked and out of control of your situation. It’s the concept behind support groups but, last I checked, there really isn’t such a thing as group therapy for home buyers. (Well, some would say that’s what Trulia Voices is for, but I digress.)

Today’s rapidly rising prices and generally volatile market does make things tough for buyers, so we thought we’d systematically explore – and then share – what’s going on inside the minds of the buyers on today’s market.  Hopefully, sellers will find some insights for marketing their properties, too.

Fresh off the presses, here are some of the insights and takeaways from our latest American Dream Survey, pinpointing the things today’s buyers worry about, will and won’t do in their quest to get their own corner of the American Dream: a home.

Worry:  Mortgage rates and prices will rise before I buy.  Trulia’s Economist Jed Kolko reports that “the top worry among all survey respondents who might buy a home someday is that mortgage rates will rise further before they buy (41%), followed by rising prices (37%).”  The worry is valid, given the fact that the market was depressed for so long and has a long recovery road ahead of it.  It’s compounded by the fact that buying a home has gone from something that used to take a month or two and now routinely takes 6 months, 9 months, a year or even longer!

Here’s the deal: you can’t stop prices from rising. And fixating on this particular fear poses the potential pitfall of  rushing to buy or making compromises that will turn out badly in the end.  Don’t dilly dally, if you’re ready and in the market, and don’t mess around making lowball offers with no chance of success.  But otherwise, don’t let this fear drive your buying and timing decisions.

Will:  Be aggressive. B. E. Aggressive. Economist Kolko explained, “among survey respondents who plan to buy a home someday, 2 in 3 (66%)  would use aggressive tactics such as bidding above asking, writing personal letters to the seller, or removing contingencies, to name a few.”  What buyers do and don’t do in the name of aggressively pursuing their dream homes (and, consequently, what sellers expect) is slightly different in every town.

Knowing that other buyers are facing down the same challenges you are and coming up with similar, aggressive solutions can help you feel a little less crazy about your thought processes and emotions and the desperate measures that come to mind when you hear how many others think “your” home is their dream home. And that puts you back in control of what can sometimes feel like an out-of-control situation. Reality check: you are 100% in the driver’s seat when it comes to how aggressive you want to be in your pursuit of any given home, and which specific tactics you leverage in the course of that pursuit.

Worry:  I won’t find a home I like.  Forty-three percent of people who plan to buy a home in the next 12 months expressed the concern that they might not be able to even find a property they like. Perhaps these people were just seriously persnickety, but I suspect there’s a bigger issue at play here.  All of us can find a home we like, but whether there’s anything we like enough to buy in our price range is a completely separate issue.

This worry, then, seems to be closely related to the fear of rising prices – buyers are rightfully fearful that home value increases will put their personal dream homes out of their price range. This is why it’s super important to:

  • be aggressive about seeing suitable properties as soon as they come onto the market
  • work with an agent whose offer pricing advice you trust
  • adjust your house hunt downward in price range if the market dynamics include lots of over-asking sales prices, and
  • not to let months and months go by while you make lowball offers or otherwise be slow to  come to the reality of what homes are actually selling for in your area.

The sooner you put yourself seriously in the game and make reality-based offers, the more likely you’ll be able to score a home you like in your price range.

Worry:  I will have to compete with other buyers for the home I like. Twenty-seven percent of those who plan to buy at some point in the future and 32% of those who plan to buy in the next year said they feared the prospect of facing a bidding war. This worry is well-grounded. In California, the average property receives four offers – but stories of dozens of offers abound. And it’s not just a West Coast phenomenon: buyers from coast to coast trade tales of getting outbid and having to throw in their firstborn child, lastborn puppy and most precious earthly possessions just to get into contract.

Truth is, market dynamics vary from town to town, and even neighborhood to neighborhood, but if you’re buying on today’s market or planning to buy anytime soon, bidding wars, multiple offers and over-asking sales prices are a reality you will probably have to factor into your house hunt.

Won’t:  Bid way more than asking.  Only 9 percent of wanna-be buyers said they would bid between 6 and 10 percent over the asking price for a property. This finding surfaces the uber-importance of checking in with an experienced local agent to get a briefing on precisely how much over asking homes are selling for in your area.  This empowers you to tweak your online house hunting price range low enough that you can make an over-asking offer and be successful without breaking the bank.  And once you’ve gotten a reality-based estimate of the over-asking norm, it will loom less ominously in your mind’s eye as a potential American Dream-killer.

Worry:  I won’t qualify for a mortgage.  Thirty percent of all people who identified themselves as planning to buy a home in the future said they were worried they might not be able to qualify for a home loan. (Interestingly, only 25 percent of buyers in hot markets like Oakland and Las Vegas expressed this concern – rapidly rising prices and knowing lots of other buyers are closing transactions in your town seems to ease this fear.)

Of all the worries on the list, this is the one over which a smart buyer has the most power. So exercise it! Work with a mortgage broker who was referred by friends, family members or an agent you trust.  And ideally, work with them months – even a year or more – before you plan to buy.  They can help you put an action plan in place around boosting your savings and credit score, and minimize your debt and credit dings, that you can work to minimize mortgage qualifying dramas when the time is right. They can also help give you a stronger sense of what you can afford vis-a-vis your income, to help you anticipate any challenges related to what sort of home your dollar will buy in your market.

ALL: What worries do you have about today’s market? Which steps are you willing to take in your quest to achieve the American Dream?

I read this article at:  http://www.trulia.com/blog/taranelson/2013/07/6_wills_won_ts_and_worries_of_2013_home_buyers?ecampaign=cnews20+and1308A&eurl=www.trulia.com%2Fblog%2Ftaranelson%2F2013%2F07%2F6_wills_won_ts_and_worries_of_2013_home_buyers

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

Email Sabrina & Susan at:  Info@TheCatonTeam.com

Call The Caton Team at 650-568-5522

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

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

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Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

Eight Ways To Improve Your Home Appraisal

When I read this article I had to share it.  The Caton Team always provides comparable properties for our buyers appraisal.  But when you are refinancing on your own – don’t hesitate to call us – we’ll provide comparable properties for you!  What can the Caton Team do for you?

Eight Ways To Improve Your Home Appraisal

When Kellie and Michael May decided to refinance their home in the New York suburbs, they wanted to take advantage of historically low interest rates. But before landing a new 30-year fixed-rate mortgage, they had to get through a home appraisal.

“It was a major stumbling block,” says Kellie May, who has owned the 4-bedroom, 3-bath colonial for seven years. Not that she and her husband were unprepared; they’d been through an appraisal for another refinance in 2010, so they knew to point out improvements they’d made to the 3,400 square foot home, and supply prices for other neighborhood properties that had sold recently.

But the appraisal came back roughly $70,000 less than the $1,230,000 the Mays were expecting, and too low to support their new loan.

They responded with a paperwork arsenal aimed at their lender, asserting that the appraisal had been based on faulty recent sales data. The loan squeaked through, after the bank crafted an exception for the Mays. It was able to do that because their loan was a jumbo loan, not subject to the more rigid underwriting standards they would have encountered if it were a conventional loan aimed at secondary buyers like Fannie Mae and Freddie Mac.

Low appraisals are becoming a bigger problem for many would-be buyers and refinancers as home values have started to stabilize and rise in some markets.

In Leesburg, Florida, for example, low appraisals have caused the cancellation of as many as 15 percent of home sales for local real estate broker Gus Grizzard.

“We are seeing higher price appreciation and are starting to run into appraisal problems,” said Charlie Young, chief executive officer of ERA Franchise Systems, a firm with a national network of real estate brokerage offices, including Grizzard’s. The National Association of Realtors reported on Tuesday that inventories of homes were low and the median price a home resale was, at $180,800 in December, up 11.5 percent in a year.

Appraisals are based on recent sales prices of comparable properties. And in rising price markets, those sales prices might not be high enough to support the newest deals. Young said there were many places in California reporting appraisal problems.

On Friday, the federal government issued new rules aimed at improving the appraisal process as it pertains to high-interest mortgages on rapidly appreciating homes.

But those rules don’t go into effect for a year, and don’t apply to most conventional loans. It pays to protect your own loan before the bank even thinks about sending that guy with the clipboard over to your house.

“The reality is that the appraiser is only there for 30 minutes at most,” says Brian Coester, chief executive of CoesterVMS, a nationwide appraisal management company based in Rockville, Maryland. “The best thing a homeowner can do to get the highest appraisal possible is make sure they have all the important features of the home readily available for the appraiser.”

Here are eight ways you can bolster your appraisal:

MAKE SURE APPRAISER KNOWS YOUR NEIGHBORHOOD – SOOOOOOO IMPORTANT

Is the appraiser from within a 10-mile radius of your property? “This is one of the first questions you should ask the appraiser,” says Ben Salem, a real estate agent with Rodeo Realty in Beverly Hills, California.

He recalled a recent case where an appraiser visited an unfamiliar property in nearby Orange County and produced an appraisal that Salem said was $150,000 off. “If the appraiser doesn’t know the area intimately, chances are the appraisal will not come back close to what a property is really worth.”

You can request that your lender send a local appraiser; if that still doesn’t happen, supply as much information as you can about the quality of your neighborhood.

PROVIDE YOUR OWN COMPARABLES – Call The Caton Team – We’d be happy to help you!

Provide your appraiser with at least three solid and well-priced comparable properties. You will save her some work, and insure that she is getting price information from homes that really are similar to yours.

Websites including Realtor.com, Zillow and Trulia offer recent sales prices and details such as the number of bedrooms and bathrooms in a home.

KNOW WHAT ADDS THE MOST VALUE – Not sure where to put your money?  Call The Caton Team – We’ll help!

If you’re going to do minor renovations, start with your kitchen and bathrooms, says G. Stacy Sirmans, a professor of real estate at Florida State University. He reviewed 150 variables that affect home values for a study sponsored by the National Association of Realtors. Wood floors, landscaping and an enclosed garage can also drive up appraisals.

DOCUMENT YOUR FIX-UPS – Keep those receipts!

If you’ve put money into the house, prove it, says Salem.

“Before-and-after photos, along with a well-defined spreadsheet of what was spent on each renovation, should persuade an appraiser to turn in a number that far exceeds what he or she first called out.”

Don’t forget to highlight all-important structural improvements to electrical systems, heating and cooling systems – which are harder to see, but can dramatically boost an appraisal. Show receipts.

TALK UP YOUR TOWN

If your town has recently seen exciting developments, such as upscale restaurants, museums, parks or other amenities, make sure your appraiser knows about them, says Craig Silverman, principal and chief appraiser at Silverman & Co. in Newtown, Pennsylvania.

DISTINGUISH BETWEEN UPSTAIRS AND DOWNSTAIRS

Many homeowners covet that refinished basement, but that doesn’t mean appraisers look at it the same way. “Improvements and additions made below grade, such as a finished basement, do not add to the overall square footage of your house,” says John Walsh, president of Total Mortgage Services in New York. “So they don’t add anywhere near as much value as improvements made above grade.”

According to Remodeling magazine, a basement renovation that cost $63,000 in 2011-12 will recoup roughly 66 percent of that in added home value. That’s not as good as an attic bedroom, which will recoup 73 percent of its cost. Even similar bedrooms typically count for more if they are upstairs instead of downstairs.

CLEAN UP

Even jaded appraisers can be swayed by a good looking yard. “Tree trimming, cleaning up, a few flowers in the flower beds and paint touch up can all help the appraisal,” says Agnes Huff, a real estate investor based in Los Angeles.

That advice holds true indoors, too. “Get rid of all the clutter in your home,” says Jonathan Miller, a longtime appraiser in New York. “It makes the home appear larger.”

GIVE THE APPRAISER SOME SPACE

Don’t follow the appraiser around like a puppy. “I can’t tell you how many homeowners or listing agents follow me around in my personal space during the inspection,” he says. “It’s a major red flag there is a problem with the home.”

And while you’re at it, make the appraiser’s job as pleasant as possible by giving your home a pleasant smell. At a minimum, clean out the litter box. Baking some fresh cookies and offering him one or two probably won’t sway your appraisal, nor should it. But it couldn’t hurt.

I read this article at: http://www.reuters.com/article/2013/01/22/us-usa-housing-appraisals-idUSBRE90L0ZE20130122?VBd0T4I3F0KvenaC7w1NXQ=1

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

Email Sabrina & Susan at:  Info@TheCatonTeam.com

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

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

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Pintrest: https://pinterest.com/SabrinaCaton/

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

1st-Time Buyers Losing to Investors – tell me something I don’t know….

If you are a home buyer in todays real estate market on the SF Peninsula – then you already know!  Cash buyers have come out in force and it feels like they are scooping up every house on the market.

Below is an article I read in the SF Chronicle.  It hit home hard.  The Caton Team has been writing offers, sometimes multiple offers for one client on several properties praying one will be accepted.  This market is nuts.  And before I hear anyone say – you must love it!  NO!  Realtors do not like this type of market.  We are human.  We may perform some superhuman stunts from time to time –  but we are human.  Realtors like stable markets with consistent growth.  Not manic markets – with ” one open house and offers are due on Monday” – markets.  If I am feeling the rush – I know my clients are – and for them – this is a new experience.  For the Caton Team – with over 25 years combined experience, this is just another day on the job.

So as you venture and read this article – I must add my two cents.  DO NOT GIVE UP!  Giving up and not getting an offer accepted has the same results – not keys to your new home.  But dusting yourself off and getting back on the horse to meet your Realtor at lunch to see the next new listing – now that’s tackling this market like a pro!  In our experience, buyers who are dedicated to becoming owners will get a house.  It may not be the house they dreamt about.  It may not have all the bedrooms they wanted or the yard they liked – but you can make all those things happen – once you get your house.  Curious what the Caton Team does differently for our clients – come on and and let’s talk!  Questions – email me at Info@TheCatonTeam.com

Enjoy!

1st-time buyers losing to investors

Many outbid by absentee owners in a rapidly rising market

By  Carolyn Said 

Hunter Mack and Nyree Bekarian are eager to buy a home for their growing family. They started looking when their son Emmett was a year old. Now he’s 2 1/2, and they have a second child due any day. And they’re still looking.

After seven years of marriage, Carlos and Robin Mariona felt the time was right to buy their own place and looked forward to leveraging his past Navy service with a Veterans Affairs loan. But their search stretched on for months, despite the loan guarantee. While their price ranges and target areas varied, these Bay Area families confronted the same reality once they started house hunting. They were consistently outbid, often by investors who paid all cash. Sometimes, even if they had the highest bid – especially in the case of the Mariona family and their VA loan – they were still rejected in favor of an all-cash offer.

“We’re people who want to commit to a place where we can live and grow together, but it hasn’t been possible,” said Mack, who teaches mechanical engineering at UC Berkeley. “We’re two mid-30s professionals who want to spend over half a million dollars on a home, but we can’t find anything, which is ridiculous. We’ve probably made 10 offers. At this point, with many homes, we’re not making offers anymore because we know we’ll be slaughtered.”

Eager to get their piece of the American dream while interest rates are low, many first-time home buyers instead are finding that they’re priced out of a rapidly rising market where they must compete with deep-pocketed investors.

Absentee home buyers now account for about 27 percent of Bay Area home sales, according to real estate research firm DataQuick. All-cash buyers (who overlap with absentee buyers) represent almost a third of sales. Historically, cash buyers were about 13 percent of sales.

First-time home buyers bought 36 percent of California homes sold in 2012, according to the California Association of Realtors. In 2009 and 2010 they represented 47 percent and 44 percent of the market, respectively. Over the past eight years, first-time buyers averaged 39 percent of the market.

Government-backed Federal Housing Administration loans, which are popular with first-time buyers because they allow for smaller down payments, accounted for 12.3 percent of Bay Area home purchases in March, according to research firm DataQuick. That was down from 20.9 percent in March 2012.

“In recent months the FHA level (in the Bay Area) has been the lowest since summer 2008, reflecting both tougher qualifying standards and the difficulties first-time buyers have competing with investors and other cash buyers,” DataQuick said in a statement.

Neighborhood impact

The strong investor presence brings up questions about the long-term impact on neighborhoods.

“I think it’s a shame that all these properties are going to investors and not to people who actually want to live there and be part of the community,” said Rachel Beth Egenhoefer, who along with Kyle Jennings set out to find a new home before their baby was born. She’s now 5 months old, and they’re still looking. “It’s easy for sellers to take the cash and run, but what about having people who actually care about the neighborhood and want to be there and invest in it?”

Maria Benjamin, executive director of the Community Housing Development Corp. of North Richmond, had similar thoughts. The preponderance of investor buyers, most of whom rent out homes, “creates a lot of absentee landlords and a high turnover in neighborhoods,” she said. “All that causes neighborhood instability.”

Then there’s the impact on the families that spend months looking for a home to buy while staying put – in sometimes less than ideal conditions.

Many prospective buyers “are being forced to just stay where they are renting and make do,” said Jennifer Ames, an agent with Red Oak Realty. “Most of my buyers are young families who have outgrown their spaces. They’re all just hanging in, trying to do the best they can with their circumstances.”

People seeking starter homes do have some things working in their favor. Besides the historically low interest rates, home prices in many areas are still far from their peaks. The Bay Area March median of $436,000, for instance, is about a third lower than the region’s $665,000 peak in summer 2007, DataQuick said.

Still, that window of affordability seems to be closing. The California Association of Realtors on Friday said the state’s “affordability index” (the percentage of home buyers who could afford to purchase a median-priced existing single family home in the state) dropped to 44 percent in the first quarter, down from 56 percent a year earlier.

“Higher home prices put a dent in California’s housing affordability,” the Realtors association said in a statement.

Location counts

The three couples seeking homes all have solid employment and can afford to spend from about $350,000 to $550,000 – typical prices for starter homes in this region. All are looking in the East Bay, which is more affordable than San Francisco and the Peninsula. Alameda County’s current median is $416,000; Contra Costa County’s is $346,000.

Still, prices continue to rise rapidly in most of the region, making the search more difficult. “The bottom line in the decent neighborhoods keeps getting raised,” said Patrick Leaper, an agent with Red Oak Realty. “Entry-level buyers are looking at prices going up 2 or 3 percent a month sometimes. That’s critical for somebody whose finances are (tight). They end up being priced out of the market or forced to go to areas or neighborhoods that they weren’t interested in before.”

Looking around

Sometimes expanding the geographic search is what it takes to land a house. That was the case for the Marionas, who started off looking around Albany, where Robin Mariona works for the Department of Parks and Recreation.

“For the amount of money we could spend, in Albany or North Berkeley we would have gotten a smaller place than our rental,” said Carlos Mariona, an IT director for a catering company. “We were at the cusp where everyone was moving a little more north as they got priced out – El Cerrito, then San Pablo, Richmond, El Sobrante. It seemed you had more bang for the buck there.”

After more than six months of house hunting and countless rejected offers, they found a house in the Richmond View area near Wildcat Canyon Park listed at $324,000. They offered $350,000, and Leaper, their agent, negotiated with the seller to accommodate their VA loan’s tight requirements of completing all termite work before the sale closed.

“We’re very happy,” Carlos Mariona said.

More-affordable areas

Despite rapidly rising prices, more-affordable pockets remain scattered around the Bay Area. For each county, here’s the town with the lowest median price in the first quarter of this year – and how much it’s changed since the same time last year.

County City Median price Q1 2013 YOY change
Alameda Oakland $310,000 48%
Contra Costa Bay Point $153,000 4%
Marin Novato $565,000 39%
Napa American Canyon $360,000 19%
San Francisco Ingleside Heights (S.F.) $410,250 58%
San Mateo East Palo Alto $356,000 27%
Santa Clara East Valley (San Jose) $377,500 28%
Solano Vallejo $175,500 28%
Sonoma Forestville $261,450 -3%

Source: ZipRealty

Read more: http://www.sfchronicle.com/realestate/article/1st-time-buyers-losing-to-investors-4512891.php#ixzz2TJ56qE00

I read this article at:  http://www.sfchronicle.com/realestate/article/1st-time-buyers-losing-to-investors-4512891.php

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

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Thanks for reading – Sabrina

How Much Would You Pay For…

How Much Would You Pay For…

Being a full time Realtor – I get some great questions.  One of my favorites pertains to upgrades and how they affect resale value.  Please enjoy these two articles I found very interesting.  My comments are in italics.  

Buyers Will Pay Extra for These Features

By DAILY REAL ESTATE NEWS

Some home shoppers say they are willing to spend thousands of dollars above the price of the home in order to have certain interior features.

The most coveted home features tend to center around the kitchen, such as stainless steel appliances and a kitchen island, says Errol Samuelson, president of realtor.com.

24/7 Wall St. used data from the National Association of REALTORS® to determine some of the most desired home features. Here are eight features that made the list and how much extra, on average, buyers say they’re willing to pay for having that feature in a home:

  • Central air conditioning: $2,520
  • New kitchen appliances: $1,840
  • Walk-in closet in master bedroom: $1,350
  • Granite countertops: $1,620
  • Hardwood floors: $2,080
  • Ensuite master bath: $2,030
  • Kitchen island: $1,370
  • Stainless steel appliances: $1,850

Sometimes paying the premium for a fixed up home works out for a buyer.  This past weekend my client felt it made more sense to pay more for a turn key home since the interest rate is a right off and you’d have a higher write off with a more expenseive home – compared to spending their weekends fixing up a home.  Each client is different with a unique budget and point of view. 

What would you pay for?

Before making the decision to buy, people shopping for homes consider hundreds of factors. They include location of the house, the school district, size of the lot and also interior features. Most buyers insist on a house that grants most of their wishes, but shoppers often settle for a house without getting everything they want.

When it comes to certain interior features, many are willing to spend thousands of dollars above the price of the home to have them included. At least 60% of buyers said they would be willing to pay more for central air conditioning, new kitchen appliances and a walk-in closet in the master bedroom if they did not already have these features.

Many of the features homeowners desire involve the kitchen. They include stainless steel appliances and a kitchen island. The kitchen is a major focal point for home buyers, said Errol Samuelson, president of Realtor.com.

“People, in general, have shown more interest in having big and beautiful kitchens, and the kitchen is acting as an informal gathering place,” Samuelson said in an interview with 24/7 Wall St. “We have gone from the ’70s where it was about Hamburger Helper … and now we’ve got the Food Network where people are more interested in exploring cooking.”

The desirability of some characteristics vary depending on the home buyers’ age. In the survey, more people age 35 to 54 found the internal features of a house to be very important in making a decision than any other age group. When people are younger and buying their first home, they are primarily interested in jumping into the real estate market to build equity, and the features are less important, Samuelson said. “For the younger demographic, home is a place to sleep and a place to store your clothes, but you are out all the time,” he said.

When people get older, settle down with a spouse and start raising a family, they still consider the home and its features as investments. However, they often start to build more of a connection with the house, and the details of the home become important to improving quality of life in the home, and less so for long-term investment. The house becomes a “personalized area that separates [the occupants] from the outside world,” Samuelson said.

While a high percentage of people said they would pay more for some features, how much they were willing to pay was not necessarily that high. Although six in 10 home buyers without a walk-in closet said they would be willing to pay more for a house with one, those people said they would only spend an additional $1,350, much less than what a walk-in closet typically costs.

The features described are not necessarily the most important deciding factor for potential home buyers, Brendon DeSimone, a Realtor and real estate expert with Zillow, told 24/7 Wall St. When looking at house, he said, the first things people consider are factors such as the neighborhood, the school district and the difficulty of the commute to work.

“Everything starts with location,” DeSimone said in an interview. “You can have the best house in the world, but if it’s not in the neighborhood and school district where everyone wants to live, you are just not going to look at it.”

Using data from the National Association of Realtors, 24/7 Wall St. reviewed the 11 features that most homeowners were willing to pay more for. We also looked at the median amount that these people would be willing to pay to obtain that feature. In addition, we looked at data from the National Association of Realtors about whether prospective home buyers found certain features to be very important. That information was further broken down by factors such as home buyers’ age, whether they were looking to move into a new or previously owned home, and whether someone was a first-time or repeat buyer.

Based on those factors, here are the 11 most desirable home features:

11. One or more fireplaces
> Percentage of home buyers willing to pay more: 40%
> Amount willing to pay extra: $1,400

Some 40% of home buyers without a fireplace said they would spend additional money for at least one and cough up an extra $1,400. The fireplace, while always popular, was less necessary when several TVs were going in the house all at once, Samuelson said. But he speculated that having a home with fireplaces may become more popular in the future as people spend less time watching TV and more time on tablets and e-readers. These people may find the fireplace a good place to cozy up and use their devices, he said.

10. Eat-in kitchen
> Percentage of home buyers willing to pay more: 40%
> Amount willing to pay extra: $1,770

The people most interested in an eat-in kitchen tend to be in the 35-to-54 age range, with 30% of those prospective home buyers indicating this is “very important” in a house. Meanwhile, just 21% of those under 35 years of age and 20% over 55 feel the same way. More people, especially those who are raising families, want kitchens that look into family entertainment rooms. Some have even made it a family hangout by placing big-screen TVs and other electronics in the kitchen. “Buyers who are in families want to be in one space and do it all,” DeSimone said.

9. Home less than 5 years old
> Percentage of home buyers willing to pay more: 40%
> Amount willing to pay extra: $5,020

Some people simply want a newer home. For those willing to pay more for a newer home, the median that people would dole out was more than $5,000. Although this is a lot of money compared to most features, that money could be a wise investment in the long run. Maintenance costs are considerably less in newer homes compared to older homes, Samuelson pointed out. He also noted that newer homes tend to be much more efficient, attracting people who are environmentally conscious.

8. Stainless steel appliances
> Percentage of home buyers willing to pay more: 41%
> Amount willing to pay extra: $1,850

Like most features, stainless steel appliances are most important to people between the ages of 35 to 54, with 23% considering them to be a “very important” investment, compared with just 16% of those under the age of 35 and a mere 11% of those over the age of 55. From a cost perspective, stainless steel appliances are not necessarily the best investment. Samuelson noted that stainless steel wears out far easier than most other common materials. Also, the children in the house can also get their fingerprints on the appliances, requiring more cleaning. However, Samuelson said people are primarily driven to buy stainless steel appliances because they look more attractive.

7. Kitchen island
> Percentage of home buyers willing to pay more: 48%
> Amount willing to pay extra: $1,370

Kitchen islands are most important to people ages 35 to 54, with 24% indicating that it is a “very important” characteristic. Just 19% of people under 35 and 13% over 55 considered this feature important. DeSimone noted that kitchen islands often come in handy for those who are raising a family. It provides additional room to put out food for the family and allows the kitchen to become more organized. Although the desire for a kitchen island is high, those who do not have one but want one are only willing to shell out $1,370, less than most other features.

6. Ensuite master bath
> Percentage of home buyers willing to pay more: 49%
> Amount willing to pay extra: $2,030

Once again, the ensuite master bathroom tends to be more important to people ages 35 and older. “It kind of goes to the ‘home is my sanctuary’ mentality,” Samuelson said. This, along with a walk-in closet in the master bedroom, has become more important in the past 10 years or so. Many people are eager to make their bathroom more “homey” by doing things such as installing televisions on the wall. The fact that many master bathrooms have two sinks is also an appealing option for married couples, Samuelson added.

5. Hardwood floors
> Percentage of home buyers willing to pay more: 54%
> Amount willing to pay extra: $2,080

Some 25% of buyers under the age of 35, and 28% of those between 35 and 54, considered hardwood floors “very important” when looking for a home. Only 17% of people ages 55 and up felt the same way. In previous generations, homes with carpets were considered better in order to conserve energy, DeSimone said. Even today, older people are more likely to feel more comfortable with carpeting because the insulation makes the home a little bit warmer. But for younger people looking to have many guests at the house and for people with children, hardwood floors are desirable because they are easier to clean than carpets.

4. Granite countertops
> Percentage of home buyers willing to pay more: 55%
> Amount willing to pay extra: $1,620

Among homeowners between the ages of 35 and 54, 24% viewed granite countertops as “very important,” compared to 18% of people under 35 and 18% of people over 55. Although just one in every five prospective home buyers said granite countertops were very important, 55% of those who bought a home without such a countertop said they would pay extra for it. Both DeSimone and Samuelson agreed that the granite countertop is more of a style issue than anything else. “There has been more emphasis on the beautiful kitchen these days, and granite countertops are a part of that,” Samuelson said.

3. Walk-in closet in master bedroom
> Percentage of home buyers willing to pay more: 60%
> Amount willing to pay extra: $1,350

A whopping 60% of homeowners were willing to pay extra for a walk-in closet in the master bedroom, with 44% of people between the ages of 35 and 54 viewing this feature as “very important,” compared to just 35% under the age of 35 and 36% of people 55 and older. DeSimone said the walk-in closet is desired for two main reasons: space and status. The space is very desirable for people as they get older and acquire more clothes, allowing people to be more organized. Having a walk-in closet in the master bedroom is also a status symbol. When giving a house tour, DeSimone said, people want to say, “Hey, check out my closet,” in the same way they say, “Hey, have you seen my new kitchen?”

2. New kitchen appliances
> Percentage of home buyers willing to pay more: 69%
> Amount willing to pay extra: $1,840

About 69% of homeowners said they were willing to spend more money for new kitchen appliances. Unsurprisingly, people who are looking to buy a new home find this far more important than people who are eyeing previously owned homes. People who are the first to live in a specific house tend to want everything to be new in the house because they consider the house truly “their own,” DeSimone said. People also do not want to have to deal with the stress of broken appliances. “They don’t want to come home after a horrible stressful day at work and find the dishwasher isn’t working or the fridge is making noises.”

1. Central air conditioning
> Percentage of home buyers willing to pay more: 69%
> Amount willing to pay extra: $2,520

Nearly seven in 10 homeowners said they would be willing to pay more on central air conditioning — the same as new kitchen appliances and more than any other feature. Central air conditioning was considered “very important” by more than 60% of people in all age groups. Samuelson noted that although people were willing to shell out approximately $2,500 for the feature, that is far less than what it would actually cost to install central air conditioning. “There is a difference in people’s preference and what they are willing to pay for,” Samuelson said. “They may want the steak but are on a macaroni budget.”

I would love to hear your two cents!  Comment here or email me anytime at Info@TheCatonTeam.com

I read this article at:  http://realtormag.realtor.org/daily-news/2013/04/29/home-buyers-say-they-ll-pay-extra-for-these-features?om_rid=AACmlZ&om_mid=_BRfpyKB8yORuS4&om_ntype=RMODaily

And

http://www.usatoday.com/story/money/personalfinance/2013/04/28/24-7-home-features/2106203/

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

Email Sabrina & Susan at:  Info@TheCatonTeam.com

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Please enjoy my personal journey through homeownership at:

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Thanks for reading – Sabrina

Are Home Prices Rising Too Fast?

Hello Readers!
Found this article and had to share it.  Why?  Because this is on all our minds.  My 2 cents are in italics.
  
When the real estate market hit bottom you could feel the thud.  Buyers were leery of buying afraid home prices would continue to fall and sellers wouldn’t sell if their life depended on it not wanting to take any kind of loss.  Thankfully those days are behind us.  What a difference 1 year makes….it is obvious the memo is out and buyers are ready to buy again.  However, sellers are not quite there yet.  It seems that the bulk of properties for sale since 2009 were pre and post foreclosures, overinundating the market with options.  Come 2012 and today, with sellers not quite ready to put their homes on the market inventory remains low in our area – thus pushing prices up.
No Realtor or client enjoys markets like this.  Multiple offers, over bidding, no contingencies – all this is back in force right now.  Ideally we would like to see a normal healthy market with normal growth.  But with so few homes for sales and pent up buyers jumping off the fence – it is amazing to see this change that has taken place in the real estate world.
Enjoy the article – and would love to hear YOUR thoughts too!
Are Home Prices Rising Too Fast?
Some housing analysts are concerned that the sudden rise in home prices could make homes more unaffordable again if the price increases outpace income growth, The Wall Street Journal reports.
Average housing costs for home buyers who took out a mortgage were around 22.5 percent of average incomes, according to John Burns Real Estate Consulting. That is down from 38.5 percent in 2006, the peak of the housing bubble. The historical average is about 33 percent.
But with home prices rising in many markets and, in some, rising at a faster pace than income levels, will more people soon be priced out of the market?
Housing analysts say that, for now at least, lower mortgage rates are offsetting the higher prices of homes.
Borrowers have seen their purchasing power rise by around 33 percent over the past four years due to the low interest rates, The Wall Street Journal reports. For example, a borrower can make a $1,000 monthly mortgage payment and qualify for a $222,000 mortgage at today’s low interest rates, compared to 2008 when they’d likely qualify for $165,000 when mortgage rates were around 6.1 percent — nearly double what they are today.
Borrowers are able to withstand home-price increases because of the low rates, not because household incomes are growing, The Wall Street Journal reports. If mortgage rates tick back up to the 6 percent or 8 percent range, homes may look overpriced relative to incomes, according to housing analysts.
By: DAILY REAL ESTATE NEWS
Source: “Why Rising Interest Rates Could Eventually Curb Price Gains,” The Wall Street Journal (April 10, 2013)
 
Got Questions? – The Caton Team is here to help.
Email Sabrina & Susan at:  Info@TheCatonTeam.com
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Thanks for reading – Sabrina

The Reality of Real Estate Reality TV – by Sabrina Caton

The Reality of Real Estate Reality TV

Aside from my passion in real estate, I love writing and learning about movie and TV production.  A while back, a high-school friend of mine, Robin, was on one of the popular Real Estate Reality shows that so many of us are addicted too.  As soon as I finished her episode I was online asking her questions about her experience and how it all worked out.

The truth behind “real estate reality” TV was as enlightening as it was awesome.  Why?  Because the truth set me free!  It confirmed it’s an entertainment show and not a true reflection on how buying a home really works.

Robin told me the episode is shot backwards.  They had already purchased their condo, they had spent plenty of weekdays and weekends house-hunting with their agent and doing the real work.  However, after they closed escrow on their new home, the production of the show started.  They walked through their future home and pretended to shop it.  Then the producers found two other properties, ones they may or may not have seen prior to buying and they walked through those too – pretending to pick it apart or discuss their likes and dislikes.

Then at the end of the show, they reveal which unit they bought and it’s all smiles and a shot of signing a one-page contract.  So not a true picture of what it takes to buy a home!

The relief spilled over me.  Of course, I knew these shows were for entertainment.  Going on 10 years as a Realtor myself, I’ve rarely showed a home, drew up a contract, got the contract accepted and closed escrow in 30 minutes, minus the commercial spots.  But the people, the real buyers, are watching the show and not thinking about it as entertainment as much as following a buyer’s journey.

That’s where the hard part starts for us Realtors!  Get a new client in the car, ready to show some homes and they tell you – we only want to do this for about a month. Scrape my jaw off the floor and break the truth to them.  In today’s real estate market, at least here on the SF Peninsula – you’ll be house hunting for months!  Some people can handle it some cannot.  I guess it’s one of those moments where you separate the men from the boys.

So I thought I would write a blog about it and share my ‘Ah-Ha’ moment.  Because we, (myself included before I became a licensed Realtor), would sit down and enjoy these shows and in the back of our minds we believed it was that easy.

In the last year or so, the SF Peninsula has switched from a buyers market, with plenty of inventory in various price ranges and condition, to a sellers market, with limited inventory and even the trashy properties receiving multiple offers and over bidding.

Real estate, as all things are, is cyclical.  What goes up, goes down, then up again.  That’s when I remind my buying clients that life is not like those TV shows, not even close to the ones branded as Reality TV.  If you truly want to own a piece of the Silicon Valley, it is going to take work, patience, and flexibility.  And the view from my drivers seat is fantastic.  There are opportunities out there for each buyer, they just have to open their eyes and their mind – and drop the ‘reality’ from those TV shows.

So get off the couch and in my car – we’ll take you on a real Real Estate journey – just a bit longer than 30 minutes.

Thanks for reading!  Sabrina
Got Questions? – The Caton Team is here to help.
Email Sabrina & Susan at:  Info@TheCatonTeam.com
Visit our Website at:   http://thecatonteam.com/
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Please enjoy my personal journey through homeownership at:
Thanks for reading – Sabrina

Bay Area Real Estate Market is Sizzling!

Found this great article by Carolyn Said of the San Francisco Chronicle.  Had to share and add my 2 cents are in italics.

Tight inventory – a dearth of homes for sale – is driving bidding wars throughout the Bay Area, sending prices up and leaving scores of disappointed would-be buyers. Homes that do hit the market sell within days.

So few homes are listed for sale that agents are resurrecting old ways of drumming up business – going door to door, leaving cards and flyers and writing personal letters, asking owners if they’re interested in selling. Social networking and e-mail blasts are being used to increase inventory as well.

This is all too true.  The Caton Team has started targeting areas, condo complexes, neighborhoods and individual homes to find the right home for our buying clients.  It’s that tough!  And with some first time buyers, the window is closing as prices creep up.  Not to mention we are on the edge of our seats worried if interest rates rise.

“People are going old-school, farming their territory,” said Lynda D, an agent in the East Bay, using real estate agent slang for canvassing neighborhoods.

While tight inventory is a national trend, it’s especially pronounced in the Bay Area.

Alameda County, for instance, had 949 homes for sale in February, down 64 percent from the 2,617 on the market at the same time last year, according to data from Realtor.com, the listings website of the National Association of Realtors. Contra Costa County had 899, down 58 percent from 2,152 in February 2012.

“Those are striking reductions in inventory,” said Errol Samuelson, president of Realtor.com.

While inventory numbers did tick up slightly from January to February, that was a normal seasonal change, not an indication of the logjam loosening.

“After seasonal adjustments, inventory is still falling; the underlying trend is still downward,” said Jed Kolko, chief economist with real estate site Trulia.com.

However, he thinks the rate of decline is slowing.

“Inventory tends to fall the most sharply after prices bottom, as no one wants to sell at the bottom, they just want to buy,” he said. Trulia shows that Bay Area prices bottomed more than a year ago.

Price a factor

Sellers remain reluctant and elusive for several reasons. Those who are still underwater – owing more than their house is worth – have the obvious impediment of not wanting to do a short sale.

But many others “feel underwater based on the price they paid,” Samuelson said. That is, someone who paid $700,000 for a home in 2007 won’t feel good about selling it for $625,000 right now, even though the sale would cover their remaining mortgage.

Some potential sellers, seeing prices surge, are hoping to hold out for more. Others who might want to move up to a bigger house fear that the market frenzy means they won’t be able to find or afford anything else.

This is such a dilemma.  If a seller has enough equity, finally, to sell – the next question is – Where do we go?  If a seller wants to stay in the Bay Area, selling now means jumping into the buying pool – and that pool is man eat man!  So this truly creates a problem.

Now that it’s spring, the busiest real estate season, more homes should start hitting the market. But many agents have been taking matters into their own hands, making pitches directly to potential sellers about why it’s time to get off the fence.

Although there are numerous online sites to track homes for sale, “the way the market is set up now is forcing us to go back to the beginning where (agents) walk up to a door and knock and say, ‘Hi, how are you, my name is … ‘ ” said Adelaida M, a Realtor in San Francisco.

Personal touch

She recently worked with a client seeking a home in San Francisco’s Clarendon Heights neighborhood, above Cole Valley. After losing out with bids, she walked the neighborhood with him and identified houses he particularly liked. Mejia looked up the homeowners and wrote personal letters to each, explaining that her client loved the area and was seeking a house there.

“Three weeks later, one person called me back and said ‘We loved your letter, we’d love to talk even though we’re not on the market, come on over,’ ” she said.

Rich and Renee G, the homeowners, said they received two or three agent solicitations a week after unsuccessfully trying to sell the house last year, but ignored them because they were form letters.

I couldn’t agree more.  The Caton Team has taken this stance and only solicits a seller when we have an actual buyer for their home.  We’re not trying to just get listings.  We are trying to unit buyers and sellers.  I personally experienced what it feels like to be a seller for the past three years.  Back and forth with my loan modification paperwork, we placed our home on the market and with no offers, pulled it off the market for a spell.  During that time I got stacks and stacks of form letters.  Truthfully, it was starting to frost my cookies.  It was evident all us Realtors are trying to drum up business, but the form letters were bothering me.  They were heartless and actually hurt me – because we didn’t really want to sell – but had to.  In the end we listed our home in October of 2012 and sold it within weeks!  Now, on the other side of the fence, I consider how a homeowner would feel when they get a form letter.  Therefore The Caton Team takes the time to write a real letter, talk about the buyers we are representing and take it from there.

“Adelaida’s note was different; more personalized,” Rich said. “We were planning to put the house on the market again, but the note just pre-empted that.”

Her client ended up visiting the house, making an all-cash offer and buying it. “It was a really stress-free experience for both” the buyer and seller, she said.

If you do ask The Caton Team of your Realtor to solicit homes for you – be prepared to pay fair market value or more because if you aren’t willing too – the seller will simply put the home on the market, get multiple offers and sell for top dollar.  So in other words, you need to ‘make them an offer they cannot refuse.’

Beating the bushes for sellers is an about-face from just 18 months ago, when the challenge was to find people who wanted to buy.

A corresponding trend is that homes are selling very quickly.

‘Unbelievable’

“The median days on market in Contra Costa is 13 days – that’s unbelievable,” Samuelson said. A year ago it was 33 days.

Redfin has identified another trend it calls “flash sales” – homes that sell within 24 hours of being listed, usually because a buyer swoops in with an offer too good to refuse. Often, those are buyers who have lost other bidding wars and are determined to land a property.

In the past six months, almost 1,000 Bay Area properties went under contract within one day, Redfin said.

That’s the truth.  The Caton Team has started showing homes the day they come on the market and are prepared, right then and there, to write an offer if our client likes the home.  Gone are the days, for now at least, that you could see a home, think about it, maybe sleep on it, then write the offer.  Lately it’s felt like – ‘you like it – let’s write’!   And with each offer we write for each buyer, we’re doing everything we can to make the offer more likable to the seller.  We are using every tool in our toolbox and the toolbox of our clients. 

“I just had that experience at a house in the Oakland hills,” DiVito said. “I held the brokers’ tour just before putting it on the market. A buyer and agent walked in and offered us our list price in cash on the spot.”

Underscoring how much the market has changed, she said her sellers had tried to sell the house a year ago “and could not move this property, even though they lowered the price three times.”

Been there done that.  It is amazing how much our real estate market has changed in one year alone.  In 2010 and 2011 I had my own condo to sell, and nobody was interested.  October 2012 – put it on the market and within days I had several offers.  In the end, 20 offers on the same condo.  Amazing what a year can do.

Same-day offer

The sellers, who were buying a new home and needed to sell quickly, were happy to take the same-day offer since a cash deal meant it couldn’t be derailed by problems with financing or appraisals.

“Flash-sale terms tend to be really good because (buyers) really want to lock down that property quickly,” DiVito said. “They’re more willing to meet the sellers’ needs to scoop it up before anyone else gets it.”

What happens next with inventory is a big question hanging over the real estate recovery.

“My best guess is that you’ll see an orderly return of inventory to the market,” Samuelson said. “I don’t expect that you’ll see the floodgates open and torrents of properties hit the market. But for each percentage point increase in price, there will be some people who for life reasons have wanted to sell for the past five years – their kids moved out, they got divorced – and now feel that the time is right and they have enough equity.”

Don’t be discouraged if you are a buyer out there.  Don’t sit back either.  The best education a buyer can have is living the market.  So if you are thinking of buying a home, get pre-approved, call The Caton Team or your Realtor and come up with a plan.  The more active you are today – the better prepared you will be tomorrow.

I read this article at: http://www.sfgate.com/default/article/Homes-sell-faster-than-ever-in-Bay-Area-4375058.php

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Thanks for reading – Sabrina