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Elizabeth Weintraub
Where Have All the Sacramento Short Sales Gone?
My topic today — where have all the Sacramento short sales gone — brings up a few musical notes rattling around in my brain. Do you remember The Jayhawks and the tune Blue? It starts out: where have all my friends gone, they’ve all disappeared. Turned around maybe one day, you’re all that is here. That’s the song that a lonely Sacramento short sale agent who had not developed any other business is probably singing right now.
I received a chart a few days ago from the California Association of Realtors, which I have inserted above. It clearly shows the direction of foreclosures known as REOs, the short sales in Sacramento and the traditional equity sales. The dark blue on the bottom is regular homes in Sacramento for sale. It’s just about squeezed out the short sales and foreclosures, which is excellent news for our real estate market. Short sales are in red and the light blue on top is foreclosure homes.
It seems like only a few years ago that short sales dominated the market, and I went back to check. Sure enough, if you look at the time frame from November of 2010 through January of 2012, you will see that 36% of the market was short sales. Even more dramatic, 45% of the pending sales were short sales, and 32% of all closed sales were short sales.
The reasons why short sales no longer dominate the market in Sacramento are simple. We’ve had a huge uptick in appreciation. Our median sales prices rose about 45% across the board from the beginning of 2012 (which was the official Year of the Short Sale) to the summer 2013, when price increases leveled off. On top of this, most people who had ever thought about doing a short sale have already closed a short sale. These were the people who bought or refinanced from 2004 to 2009.
Today, those short sale numbers for Sacramento County in January 2014 are . . . are you ready for this? We closed 100 short sales. One hundred short sales. Is this like 100 bottles of beer on the wall? I could sing that song, too. They breakdown like this:
- Active short sales comprise 10% of the market January 2014
- Pending short sales comprise 16% of the market January 2014
- Closed short sales are 11% January 2014
I pulled those statistics from Trendgraphix reports. Fortunately, although I managed to accrue quite a specialty in short sales and even wrote a book about short sales in 2009, I still sold regular traditional real estate, and I’ve sold even more regular homes last year. I sell in the range of 8 to 10 homes a month, in case you’re wondering, so I see a wide spread of activity across our four-county area and move a lot of inventory.
Can’t say I’m sorry to see short sales disappear. They aren’t really my friend or anybody’s friend. They’re a regular pain in the neck but a necessary component of real estate for some sellers. If you’re thinking about doing a short sale, it’s not too late as there are so many good rules about short sales for sellers today that were not in place 8 years ago. It’s not the stigma it used to be, and most sellers pay no tax and have no liability because they are lucky enough to live in California. Our rules are different than other states. I can help. Nobody has sold more short sales than I have over the past 8 years in this region.
If you want more information, call Elizabeth Weintraub at 916.233.6759.
Image: California Association of Realtors
There is a Limit to How Much Help a Sacramento Real Estate Agent Can Give
Elizabeth Weintraub can help with relocation referrals.
If your home isn’t selling in Sacramento, call Elizabeth Weintraub, a top-producer Sacramento real estate agent, to fix it. She’ll know exactly what to do, what’s wrong with it and how to correctly price that home. That seems to the general consensus lately based on some of the phone calls I’ve received. While it is true, and I try to help everybody if I can, there are only so many hours in the day and, besides, let’s face it, if it’s not my listing, I don’t get paid for this assistance. I am not a nonprofit entity. Agents don’t work for free (unless they’re working on short sales in bankruptcy). If you’re not planning on canceling your listing, don’t call me. This agent cannot interfere in another agent’s listing. If you’re canceling your listing, though, that’s another story.
People call and say I found you online, and you seem to be so smart with great reviews, I need some help. Sure, flatter and then stab me in the heart when you say you’re working with another agent. I’ve asked sellers why they stay with an agent who is not producing results and whom they complain about, because I don’t understand that attitude. It sounds so defeatist. Maybe it’s like people who are attracted to torture and get off on it, what do you call those people, there’s a noun for that, oh, yeah, politicians.
Another agent in Sacramento asked yesterday if I would be willing to meet with him privately and advise on best real estate practices and marketing plans for his brokerage. Do I look like a representative at the Small Business Association? I am a hard-working real estate broker who sells real estate under the Lyon banner in a four-county area in Sacramento. I run a business. My own business. I have team members who support and work with me. My own clients to take care of and produce results for. Even if the agent was willing to pay me, I don’t work in the field of agent support.
This is what happens when a person gives advice on the internet. People tend to forget that you are a business entity who works 12 hours a day in her own business. That’s not to say I don’t answer a quick question here and there or that I wouldn’t help an agent if I could be of assistance, but that’s not really my job.
My job is to sell homes for my sellers and make sure home buyers get into a home. If you want to buy or sell a home in Sacramento, please call Elizabeth Weintraub at 916 233 6759. If you need a referral to an agent elsewhere, I’ll be happy to assist.
5 Things Your Bankruptcy Lawyer Won’t Tell You About a Short Sale
A bankruptcy lawyer in Sacramento who dabbles in Sacramento short sales once shared with me that being a bankruptcy lawyer is like representing the bottom of the barrel as far as clientele is concerned — but I suspect what the lawyer really meant was the speciality itself carries its own stigma. I’m fairly certain bankruptcy clients come from all walks of life and all income levels. If bankruptcy lawyers are wrong about that, it might make one wonder what else they could be wrong about. Here are things that a bankruptcy lawyer is probably loathe to disclose to potential clients contemplating a short sale.
#1) You Should Probably Do Your Short Sale First and the Bankruptcy Second. However, if you go that route, you might not need the services of a bankruptcy lawyer, and I won’t get paid. Most of the debt accumulated by stressed out borrowers is mortgage related. In California, a short sale for your residence not only wipes out the debt but it wipes out personal liability and short sale taxes on the canceled debt, both federal and state.
#2) Your Mortgage Loans Don’t Vanish After a Bankruptcy. Unlike a foreclosure, in which the home reverts to the first lender and any subsequent loans are released, a bankruptcy leaves all of those loans still in the public records and still filed against the borrower, which can prevent the borrower from obtaining another loan to buy a home. Ever.
#3) Your Mortgage Lenders Will be Tougher to Deal With After the Bankruptcy. If you thought your lenders were relentless before the bankruptcy, wait until it is over and you then try to short sale. For starters, your financial situation will be improved and you might not even qualify for the short sale. Lenders are not required to grant a short sale. If that hard-money second lender was initially unreasonable, just wait, the collection department will be even more harsh and difficult after the bankruptcy. There will be no cash for a short sale for you.
#4) I Have Little Experience in Bankruptcy Law and Won’t Personally Handle Your Case. Lawyers have it tough making a living, just like anybody else who is self employed, and when they fail at one specialty, some will turn to bankruptcy law. But one thing doesn’t change, and that is the paralegal will most likely prepare and process your paperwork. You will talk to your lawyer when you write a check and when the bankruptcy has closed, not during the process.
#5) Your Real Estate Agent Knows More About Selling Homes and Cares More About You More Than I Do. Veteran real estate agents often are empathetic because it comes with the territory. On the other hand, bankruptcy lawyers do not as a rule sell short sales and have little to no experience negotiating with short sale banks much less fully understand the process of selling homes in Sacramento. A home that has been abandoned during bankruptcy proceedings becomes much more difficult to sell 6 months to a year down the road, if it will sell at all. HOA dues pile up, property taxes remain unpaid, utility bills accumulate and often the home is vandalized — none of which the bank will authorize for payment from the proceeds. A buyer won’t pay it, either.
Note: If the investor for that loan is Fannie Mae or Freddie Mac, it’s just about impossible to get the same sales price as a home that is fixed up, shining and ready for occupancy, but trust this Sacramento short sale agent, that’s exactly what the investor will still demand after a borrower completes bankruptcy.
Sellers who are considering bankruptcy would be wise to talk to an independent legal counsel, a CPA, and most likely wait until after the short sale before filing bankruptcy. As always, this agent does not give legal nor tax advice.
For more about Bankruptcy vs. Short Sale, from About.com
Image: Twitter.com. Better Call Saul, coming to you this fall on AMC.
Why Not Call a Sacramento Listing Agent Before Writing an Offer?
It’s always a good idea for the buyer’s agent to call a Sacramento listing agent to talk about the home a buyer might want to purchase, but so few agents seem to call the listing agent. Some will send text messages but it’s so much better to just dial the darned phone. Especially for me because my phone is not always visible; it’s often on mute and I rely on my Bluetooth. Of course, some Sacramento real estate agents don’t answer the phone, I get it, and it can be very frustrating for a buyer’s agent to try to get a listing agent to respond, but they owe it to the buyer to try.
Because I’ll tell you what happens when they don’t. When they don’t, the Sacramento listing agent and the seller are left to their own devices and interpretation of that buyer, and it might not be pretty. I received a few offers from buyers that arrived out of left field over the weekend, no warning. Some without the proper documentation and some at such low prices the sellers thought the buyers were on crack. I encouraged them to issue a counter offer anyway, and to address all of the issues in the counter.
Low and behold, the buyers accepted that counter offer. So, you never know. One of the crucial elements left out of the original purchase offer was a one-line sentence in the purchase agreement that mentioned the sale was contingent on selling the buyer’s home without further explanation. There was no Contingency of Purchase addendum submitted. But when I questioned the agent, it turned out the buyer’s home was in escrow. That makes all the difference in the world. It was a huge turning point for the seller and moved the seller from no way in hell to where do I sign.
We need to get back to the day when an agent calls the Sacramento listing agent. Buyer’s agents can find out if the home is still available, whether there are counter offers in the works or other offers on the way, if there is some special consideration that needs attention in the contract. Moreover, it gives the buyer’s agent a chance to pitch the qualifications of the buyer, network a little with the listing agent, establish communication and set the stage for offer acceptance.
Whether I’m listing homes in Elk Grove or West Sacramento, soon as I spot a showing through my SUPRA lockbox, I shoot off an email to the buyer’s agent to see if I can help to answer questions. My hope is to open a line of dialogue before they write an offer and to give agents easy access to my email.
Why Some Sacramento Home Buyers are Not Buying a Home
Sacramento real estate runs in cycles but no year lately has been the same as the last, much less the approaches used by Sacramento home buyers. We had a big run for 8 long years of short sales and foreclosures, but that reign is pretty much over. Sacramento has been on the rebound for the past 2 years and rising prices has shown us that. The really big push in price increases was in 2012, which continued into the summer of 2013 — what some would call a market correction. That’s why the investors have left the market because they were there at the bottom and don’t want to ride the wave up, leaving us in a real estate market filled with confused home buyers.
Yet, don’t get the idea that the market is overpriced or over inflated because it’s still appreciating, it’s simply doing so at a quiet and very slow pace. In some neighborhoods, prices might be a little flat, but they’re not falling. Full-price offers and multiple offers are still happening on the entry-level homes, especially those that are highly desirable, ready to move into. My February is filling up the calendar with March closing inventory nicely. I predict we’ll see a huge push in closed sales for March across the board in Sacramento.
I also see some Sacramento home buyers making big mistakes. I highly doubt they’re not getting good advice from their buyer’s agents because most agents have a pretty good idea of what’s going on. I suspect that buyers are talking to Uncle Joe who’s moving kinda slow, the guy who mows their lawn, the clerk at Safeway, and getting bad advice because they’re looking for advice in the wrong places. The buyer’s agents I know are working extremely hard and feeling like they’re banging their heads back and forth in a door jamb — because it feels so good when they stop. But they’re not going into escrow with their buyers.
Some Sacramento home buyers think a seller would grab an offer without financing, known as all-cash, over an offer with financing. But sellers don’t really care if you hand them a brown paper sack filled with $100 bills or a check drawn on Bank of America, it will all end up in their bank account anyway. Sellers care about the sales price and terms. Buyers don’t get a break due to financing. They might move up the scale in a multiple-offer situation with better financing or cash, but price is still king. Price rules. Get with the program. It’s a new dawn.
I’ve also seen Sacramento buyers submit under-market price offers, sometimes known as lowball offers, when they know the seller has received multiple offers, as in 3 or 5 offers or more. I wonder why they do that to their agents? It sounds sadistic to me. They have no chance in negotiations yet they insist on submitting an offer. Maybe that’s not sadistic, perhaps that’s the definition of insane, doing the same thing over and over with no chance in hell of accomplishing anything.
