Real Estate stories from The Bay Area to The Central Valley region

Just about any where you turn to view real estate you see advertisements promoting helping you short sale your home. If you’re looking for a home just about 80% of the properties listed are either subject to a short sale or they are already foreclosed (REO - Real Estate Owned/bank owned property). The short sale reach has extended into receiving postcards by mail, leaflets left at the doorstep and resulted in certification programs that are great for learning but have very little to do with obtaining an approval from the bank(s). It often makes for a confusing market for any seller needing to short sale their home.

Really just about anybody that has purchased a home the past 10 years probably finds themselves in a short sale situation (home is worth less than what is owed and bank(s) need to approve of the shortage). With so many choices it’s hard to know who to believe or even what to believe when it comes to the challenge of successfully having a bank accept and close escrow.

I’d love to tell you that short sales are a great thing always resulting in the successful sale of your home with no ramifications but that’s not the case. Short sales provide an opportunity for homeowners to move on and sometimes result in the forgiveness of outstanding debt by the lender(s). Credit will be impacted but how long is still debatable*. Depending on who you talk with it could result in being able to purchase a new property again from as little as 2 or 3 years instead of 3 or 4 years with foreclosures*. The key thing to remember here is that as a real estate agent we *won’t have the legal or financial answers. Clients must consult legal counsel and an accountant. What we will do is work to obtain answers from your bank(s) to those pressing questions on your behalf while marketing your home and trying for a successful sale.

The success rate of short sales reports differ indicating anywhere from 5% to 40%. This means 60% or higher will not result in a successful close. Why? There are many factors from how many lenders are involved to who those lenders are and what the financial stakes are in the transaction. There’s so many homes going through the short sale process and some banks are not equipped to deal with these numbers. Many banks let homes go into foreclosure and often receive higher value for the property when listing it as a foreclosed home. Blame is passed around but the harsh truth is that business decisions discount emotion.

What sets us apart? We provide our clients with is honest feedback through each step of the short sale process. We won’t make promises but will do our best to negotiate with the lenders on your behalf. We have experience in negotiation not only in real estate but also in commercial leases, vendor aquisitions and even in court cases on behalf of our previous employers. We know how to actively listen objectively and when to provide alternatives and solutions that often overcome objections. With banks being relentless only works to a degree and at certain times. Knowing how to stay on course and remain focused on working with the banks to gain approval and the solution you’re looking for is our goal.

We have a team ready to work for you. Walking you through the short sale process step by step and keeping you informed throughout we provide guidance and solutions. Your home receives full marketing, virtual tours, open homes (if desired) and more. Best of all we will serve as your agents to discuss your home with all potential buyers, other agents and your lenders. Contact us today for a confidential conversation about your situation.

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In a market where inventory is low and the banks tend to hold back on releasing the foreclosed homes it’s time for buyers to pause and see the potential in any home they view rather than saying no too quickly.

There are many homes that require cosmetic fixes such as new paint and flooring. Many buyers upon first impression tend to rule these homes out. The bigger the mess inside the home the more likely a buyer is to say no way and cross the home off their list. Often these repairs are rather inexpensive but to the buyer they seem too much to handle.

Society has taught us that first impressions are everything. While there’s truth to this statement it’s time to view things differently. Location and layout often trump first impressions. Buyers seeing the potential with a home often overcome their initial negative feelings and turn it into the best home they found and often at the best price too.

Investors may see the potential more often than first time homebuyers. They also have the upfront capital to make things happen quickly. They have their inspectors ready to determine the extent of any damage. They have their "fix it" vendors to handle electrical, plumbing, painting, flooring, roofing and landscaping. They analyze all costs and if it makes financial sense they swing into action. We see it all the time in the form of cash offers on homes that within weeks are either for rent or re-listed on the market at $40,000 or higher above the previous listing price.

The transformation of the cosmetically challenged homes into the "wow super nice buy me today " homes is incredible to witness. It’s amazing what some new carpet, new flooring, some new appliances, a few new fixtures, a clean out and new flowers or well placed bushes outside the home can do for the sales price. Many think this would cost $20,000 or greater. Would you be surprised to find out that often a home in the 1500 sq ft range can cost as little as $5000 to redo with new flooring, paint, appliances and some outside curb appeal. The cost varies depending on the materials used and the labor cost involved. Granite and stainless steel may double, even triple the cost. But many times that’s not the case when they find mark downs and have connections to obtain the wholesale prices.

I recently entered one home that the neighbors told me was stripped bare by the previous owners. They told me that all the appliances were taken out along with the fixtures. They believed it was a real mess inside. I entered the home and to my surprise I saw a beautiful home with clean walls, spotless carpets, new Whirlpool appliances (white but sharp looking) and updated fixtures. The location of the home was very nice and the design was excellent. This home had 5 bedrooms (2 master bedrooms each with own bath), a living room, dining room, bonus room, a large kitchen and best of all it was 3200 sq ft with dual furnace and air conditioners. The home sold for less than $270,000. I later found out that the home was purchased at auction and fixed up to sell well over the previous purchase price. This will be a great home for many buyers. This one was purchased at auction but what if a buyer had purchased this home ‘as-is’ from the bank and fixed it up over time? Many buyers are doing just that. They are starting to see the potential.

Investors see the potential and weigh out the costs on each home purchased. First time home buyers need to stop, pause and weigh out their options before crossing off a home in today’s limited inventory market. Both the Central Valley and the East Bay have very limited inventory. Seeing the possibilities with each home you enter is very important. Cost is a concern but often things can be fixed over time and the location, design layout or other factor may outweigh the cosmetic challenges.

See the potential and contact us for more information on any home. Reviewing the other recently sold homes in and around the same neighborhood will help you discover the value of the home. We also provide our clients with vender contacts that give free estimates on repair costs. Property profiles, trends and more we are here to help you with your real estate needs.

From the East Bay area in cities such as Concord, Clayton, Pleasant Hill and Walnut Creek to the Central Valley region including Modesto, Turlock, Merced and Chowchilla housing inventory in most price ranges is near a record low.

For example currently in Concord there are approximately 399 homes for sale. This is in all price ranges.

In Merced currently there are approximately 250 homes for sale. Of these homes approximately 150 are listed under $150,000.

Offers are coming in quickly on these homes. It’s providing limited choices for buyers but those that are prepared to act promptly are finding some great priced homes and living the American dream.

Before in the Central Valley many of the homes would sell for cash keeping first time home buyers at bay. Now many banks are promoting home ownership over investments by reviewing owner occupied offers only for a set amount of time before taking investment offers. This allows home buyers that are approved for financing the first opportunity to purchase the home.

If you’re considering purchasing your first home please make sure you have discussed all options with a lender and that you have your pre-approval letter in hand. When you make an offer on a home the pre-approval letter along with deposit money (shows earnest/intent of purchasing home), purchase agreement and various disclosures are required. Sometimes in the case of REO homes (bank owned) they may require a buyer to be pre-approved through their own bank. In these cases your agent will provide the name and phone number to call for pre-approval. You won’t have to use the bank that provides this pre-approval. As a borrower you can select anyone to provide the financing. However sometimes the banks will provide additional incentives such as covering the cost of appraisal and/or a certain percentage of the buyer closing costs.

Remember everything is negotiable. Some banks won’t pay anything toward closing costs and further will insist that the property is to be ‘as-is’. Buyers may still ask for what will help but be prepared that at times the banks won’t give in at all. There reasoning maybe that they are already taking a huge loss. We set emotions aside in these cases for not many will feel sorry for the banks. The problem is that with low inventory levels often there are multiple offers on the property so the banks don’t have to bend.

So where are all the homes that the banks have taken back through foreclosure? We’ve been hearing for years that the banks will be releasing more homes but often these homes are either in legal limbo or the banks still have them off the market. There are many economic factors for banks, buyers, sellers to consider in today’s market before listing or buying a home.

We are here to help buyers and sellers navigate, negotiate and reach their goals. We provide our clients with representation throughout the process. Review our home finding and listing services and let us know how we can help you today.

Scott Messing

Century 21 M&M and Associates

209-769-4028

Lic #018883959

Doug Van Riper

Century 21 Diablo Valley Realty

925-787-6571

Lic #01883875

Welcome to our blog. It’s a crazy real estate world out here and we are here to share and help whenever possible!

I’m so glad to be sharing information with you and it will be my pleasure to help people by blogging about real estate in the Central Valley. My real estate partner Doug Van Riper will relay information about the Bay Area and more specifically the East Bay area soon. On occasion we will present joint stories and insights. In addition to this blog I encourage you to read the past entries by either clicking on the ‘Archived Blog’ button or by clicking here. In the past entries you’ll get a feel for the history and what we are all about which is focusing on our client’s needs. More information will also be available through our news link section in the near future.

I have so much to say but realize that the longer I go the more likely you are to stop reading. I do encourage you to read this first long entry so you can see what’s going on in most of the markets out here.

I’m going to start with a small bio about myself which will quickly lead into what’s been happening the past few years.

I’ve been a California resident on and off for the last 16 years. I started out living in the South Bay area for several years, followed by the East Bay, a move to Idaho and now I’ve been living in the Central Valley area. I’ve been involved in real estate for 10 years now. I started with a company helping locate and negotiate commercial lease space. I became a residential real estate agent starting my 5^th year now. Even as a 12 year old I can remember driving by homes with my parents and thinking wow that home is "really cool looking." I often wondered what was going on inside these mysterious looking homes. I believe it was my destiny to become an agent where I now help people get through the often confusing and sometimes frightening process.

I’m by no means new to the Central Valley region. My wife’s family has 50 years plus of ties to the Central Valley in places such as Modesto, Turlock, Merced, Planada and Fresno. We would visit her family several times each year before relocating to Merced.

For the past 2 years we heard that Merced County was in the top 5 for foreclosures. Armed with this information last April (2009) we started looking for a new home in Merced. I was expecting there to be several hundred homes with at least 4bd, 2ba and 1700 or more square feet of living space to accommodate our kids and animals. I was quickly shaken into reality.

Our agent presented me with around 20 homes to view online. I couldn’t believe it. I said how is this possible when Merced is in the top 5 for foreclosures nationwide! It was another reminder that just because the news reports something it doesn’t make it true. Well it was partly true. The banks have been holding onto so many foreclosed homes for the past 2 years. They own the homes but they aren’t releasing many. It’s more of a trickle here and there. Inventory in certain price ranges has been historically low for the Merced area.

What’s troubling is that any time a home is listed in say under the $200,000 range more times than not the home has multiple offers on it within a day. What’s more troubling is that often some of these offers are cash which at times beat out the offers backed by FHA, VA or conventional loan funding. Long story short it took us 6 home offers to purchase a home. We didn’t have much of a choice. We knew the area we wanted to live in and that made it even more limiting, but in the end we have a very nice home. It’s not my dream home but in today’s market that home is very difficult to find. Flash forward 6 months from us moving into the home and stories indicate it can takes 15, 20 even 25 offers or more for some people to purchase a home. For buyers in today’s market this can be a frustrating process.

One alternative to remember is that the Central Valley has several cities to search for homes in such as Tracy, Manteca, Modesto, Turlock, Merced and Madera. There are also several smaller cities such as Ripon, Salida, Delhi, Livingston, Los Banos and Dos Palos just to name a few. Most of these cities are within 15 minutes to 90 minutes from each other making it more convenient for home buyers.

Still in today’s market as a buyer you have to be prepared. What this means is first and foremost know what amount you’re approved for and feel comfortable paying on a monthly basis with your lender. Have a pre-approval letter in hand before you visit the homes. In some cases you won’t be able to visit the home unless you do so within hours of it being listed. My wife and I made all offers based only on seeing the pictures of the home along with the map and satellite views for the location and the school district information which was important for us. Our agent previewed a few of the homes and sent back additional pictures. We wrote our offers the same day. We made sure the offer was as attractive as can be both price wise and with our earnest money (the money put down in good faith often viewed as a sign of buyer intent of seriousness).

Great news is that despite low inventory levels homes are still being listed throughout the Bay Area and Central Valley region. In many places home prices have dropped making them affordable where just a few years ago that was not the case. Mortgage rates are still low which helps keep the payments low. For sellers setting the price can be a challenge but the great news is that your home if priced and marketed well will sell rather quickly.

I can’t wait to help people with their real estate needs. Through all of life’s challenges we all need a place to call home. As a part of the Bay to Valley home team we would be honored to represent you whether you are selling your current home or planning on buying a new one.

If you’re looking for a home please search the site and/or sign up for automatic email to see the homes the same day they are listed. If you need to sell your home we have a great marketing plan for you! Either way email or call us with any questions, concerns or just to talk about real estate.

All the best,

Scott Messing

Century 21 M&M and Associates

209-769-4028

Lic #01883959

While homes are considered real property meaning that they are immovable and come with a set of rights known as a "bundle of rights," real estate remains a very personal thing. Emotions exist throughout most real estate transactions and moreover throughout all transitions to your life.

I recently watched Real Estate Intervention one of my favorite reality shows about real estate. A young lady was so upset as she couldn’t sell her home for $610,000. The comparable homes show the worth around $535,000. Despite seeing a recently sold home and a currently active home that had similar to higher end amenities, she listed the home at $576,000. Her rational was that she didn’t want to lose money and that her agent indicated they would revisit the price every 30 days.

We call this type of marketing plan chasing the market in a down way. Despite the loss indicated by the homes that have sold in her neighborhood she has indicated that she has to have a certain amount that the economy won’t support. Not only will people not offer her anything close to the asking price but more than likely the appraisal won’t support the $576,000 asking price. Would you pay $576,000 for the identical home that just sold at $535,000?

The agent taking the listing has incentive for marketing their services and perhaps will meet some new clients as a result of having this listed on the market. We call this "buying the listing" whereby the agent knows that the home won’t sell at this price but accepts the listing in hopes of future business and possible reductions which may in the end up selling the home in the future. I’ve heard countless stories from people regarding these types of scenarios. Past experience dictates that this client/agent relationship often ends in frustration and sometimes mistrust.

Due diligence is key whenever you plan on selling a home. When you think about it you called an agent who has experience in marketing homes to present you his or her listing package. In this package you want to see the other homes that sold and your current competition. You also want to see how your home will be marketed. For some company brand recognition coupled with massive exposure will help generate the interest needed which is the first step. However pricing is in fact everything. There’s this saying that has withstood the test of time that a well priced home is a sold one.

As real estate agents with Century 21 we bring you the experience, guidance and dedication needed to successfully market your home.

In our careers have 25 years plus negotiating on behalf of our client’s best interests. We bring this experience into our real estate business.

We would be honored to represent you in selling your home!