Email ElizabethAn Unusual Saturday for This Sacramento Real Estate Agent
It is not usual for me to meet with clients nor attend a listing presentation on a Saturday. I generally use this day for writing my blogs, articles and newsletters for my homebuying website at About.com. In between, I answer calls about listings, book future appointments, so it’s not like I’m totally tuned out to my Sacramento real estate obligations, but it’s mandatory that I set aside a little bit of time in schedule to write.
However, today, I have three appointments. They could not be scheduled at any other time, so I had to squeeze them into my Saturday. If I were a less organized person, this would not be possible, but I am flexible enough to be able to make last-minute changes. In fact, I seriously doubt another agent in Sacramento could survive the fast pace of my real estate business yet still maintain time to focus on each client individually like I do. Not one of my clients ever feel as though I don’t have enough time for them, because I make time for every client.
I’m meeting first with a couple who have a fourplex in downtown Sacramento, and I’ve already received preapproval on their short sale. I wanted to make sure they had no worries nor concerns when we go into the short sale. This meant juggling a few events for them so it better met their personal schedule. We have a preapproved price, so we’re basically meeting to shake hands face-to-face and sign the listing paperwork. This will go on the market on Monday.
Next, I have a seller who needs to sign a purchase contract and has no access to a fax machine nor a printer. She cannot scan documents. She could pop in to any of our 17 offices and I could email the documents to that office, but she prefers to come to my office, and that’s OK. I will bring the purchase offer with me and highlight the places where she needs to sign, just so we don’t miss any of those all-important initials.
Ending my day is a listing presentation for a seller in the Pocket. My team member Barbara Dow was out showing homes yesterday and called this seller to make an appointment to show her home. The seller said there were no showings. Apparently, the seller told her she was so mad at her agent that she had just dumped her agent. I asked Barbara to give me the phone number, and I checked MLS. Sure enough, the listing had been withdrawn. So, I called the seller and said: “Hey, I hear you’re looking for a real estate agent? Well, guess what? I am a Sacramento real estate agent! How lucky is that?”
I can always write tomorrow.
When Your Sacramento Short Sale Contract Expires
My transaction coordinator flags me when a short sale contract is about to expire. But it’s not really my place to ask the buyer’s agent to extend. As a Sacramento short sale agent who represents the seller, however, I do want to protect the seller’s interests. Generally, I will call the seller to ask if the seller wants to extend the contract with the buyer, and often the seller has no reason not to extend the purchase contract. But sometimes, for other reasons, a seller might want to cancel the contract and choose a different buyer.
What I find interesting is that buyers rarely realize their contracts are about to expire, and buyer’s agents are often in the dark as well. If an agent doesn’t sell very many short sales, an agent might not know that the short sale addendum sets the contract period. In Section 1A, the short sale addendum establishes the time frame during which a buyer and seller agree to wait for lender approval of the short sale.
It’s funny because upon contract inception, agents often miss inserting a time frame. The default, if no other number of days is entered, is 45 days. That’s laughable because very few short sales are approved in 45 days. I wonder how many short sales completed between other parties have expired by the time they close escrow? I imagine a lot. Because so many professionals tend to overlook the power of Section 1A.
Up front, buyers often balk at inserting 90 days, which is almost always my recommendation. But when those 90 days are over and the seller is about to cancel the contract, all of a sudden the buyer is willing to extend for as long as it takes.
Why don’t they just do that upfront? They wouldn’t have this problem if they put, say, 360 days, in Section 1A. It’s unlikely their contract would expire by the time they receive approval.
If Your Home in Land Park Doesn’t Immediately Sell
It’s pretty frustrating in a seller’s market for a seller to wonder why all the houses around his house are selling but his is not. Especially a gorgeous home in Land Park, listed by a Land Park agent. There are basically 3 reasons why a house doesn’t sell:
- location
- price
- condition
If the location is questionable or of concern to a buyer, then the price needs to be adjusted accordingly. It’s difficult to get the same price for a home like that as compared to a home in a highly desirable location, but sometimes you can.
The trick is to correctly position that home among the others offered for sale. A seller might want to think like a buyer before putting his home on the market. He should look for trends in the marketplace such as how long does it take each home to be exposed to the market before it sells? This is known as Days on Market. Any Land Park agent will know the approximate days on market when asked.
But more important, the seller should examine the competition, just like his Land Park agent will do. For example, if he were a buyer looking, say, in the $350,000 to $400,000 range for a home in Land Park, what else is available for sale? What can he buy for that price? How do those homes compare to the one the seller intends to put on the market? If his listing is the only available listing, he will get a lot of action, maybe even multiple offers, even if his home is not in the best location.
I’ve seen this happen over and over. Might have a home that sits on the market for a few weeks with no offers but generating a lot of showings. Getting showings tells this Land Park agent the buyer’s agent put the Land Park home on a tour for a reason. Was it the first home or the last home? Is the buyer’s agent using that home as the bad house nobody would ever buy? Agents often show a bad house to use as comparison. We might have no offers but one day three offers show up. If I were to check MLS, it would probably tell me there was nothing left to buy. Not in Land Park, nor Curtis Park nor East Sacramento, which are three areas a Land Park buyer might look if she wants to buy in Land Park.
Sometimes, your number just comes up. But wouldn’t it be easier to just reduce the price in the first place?
If you’d like to chat with an experienced agent who lives and works in Land Park, call Elizabeth Weintraub, at Lyon RE, 916.233.6759.
How to Keep a Home on the Market in Sacramento After Offer Acceptance
I am finding that overall, many buyers are not very committed in our Sacramento real estate market. That’s a good reason to keep the home on the market after going into contract. Part of the reluctance to commit, I’m supposing, comes from the fact they feel pressured with multiple offers happening on such a large number of homes, and it’s frustrating that they have very few homes from which to choose. This is a scary market for first-time home buyers. We’ve never had a market like this in my lifetime before in Sacramento.
We have low prices but they are moving upwards quickly in some neighborhoods. Interest rates are historically low, around 3.75%, which is just incredible. A buyer’s purchasing power is immense. They can buy twice the home for half the money today, as compared to 7 years ago. But they have also witnessed first-hand the crash of the real estate market, and some of them feel very uncomfortable navigating in unchartered waters. It’s not unusual to go into escrow one day and then have the buyer cancel the next. This is why you want to keep the home on the market if at all possible without immediately jumping into pending status.
Home sellers in Land Park had this happen to them a while back. They negotiated in good faith an agreed-upon sales price and were relieved and thrilled that their home was sold. But, the following day, the buyers bailed. They didn’t give a good reason. See, that’s the thing, in California, a buyer can pretty much cancel a contract for any reason within the inspection period which, by default, is 17 days.
The next time we received an offer, the sellers were more cautious. The buyers wrote a clean offer, but until they removed the contingencies, the buyers could easily cancel. Their agent wrote an addendum containing verbiage about cancellation that was already preprinted in the purchase contract, and that’s part of what made the sellers worry. Agents don’t always think about how their addendums will be perceived by the sellers when they are trying to appease the buyers. But if the buyers require reassurance about cancellation rights, this makes the sellers understandably nervous. So, the purpose of the addendum backfired.
How to fix it was my quandary. Part of the solution was to keep the home on the market in active status. Once a seller takes a home off the market and then puts it back on the market, buyers begin to wonder what is wrong with the home. Why didn’t the buyers want to buy it? Did they uncover something horrible about the home? Is there a structural defect? When the truth is half the time “back on market” status is just due to flakey buyers: you’ve got the blind leading the blind. It’s much better to keep the home on the market for a while.
In a seller’s market, removing a home from the market takes it out of inventory, and it’s difficult to drum up enthusiasm for the home if it goes back. Especially in a seller’s market, it is much better for the seller to leave the home on the market in active status. However, a Sacramento real estate agent must present a true picture in advertising. This means we have to tell buyers that we have an offer. I accomplished that by adding a Pending Rescission modifier to the active status. In the confidential agent remarks, I suggested that agents write a back-up offer subject to the cancellation of the existing offer.
The sellers received a back-up offer, too. That’s because everybody wants something that somebody else wants. That’s a true principle that applies to real estate.
The sellers countered the buyers that they would leave the home on the market and remove it once the buyers had removed their contingencies. This way, everybody won, and the sellers felt more agreeable to accepting the offer.
If you’re looking for an experienced Sacramento real estate agent who puts her clients’ needs first and foremost, call Elizabeth Weintraub at 916.233.6759.
Bank Pricing for Short Sales and Foreclosures
Some real estate agents wrongly believe that the price doesn’t matter in a short sale. Buyers might have adopted that attitude from their agents or perhaps they just plucked it out of thin air, but I doubt it. They tend to confuse short sales with foreclosures and bank-owned homes. My favorite is when I hear that all banks are desperate. Maybe it’s the get-rich-quick-schemes they read about that makes them so eager to believe something so wrong.
You think those guys bidding on the courthouse steps at trustee’s auctions are picking up tons of property way under market value? Market value means what the market will bear — the price a seller is willing to sell for and a buyer is willing to pay, which is generally substantiated by comparable sales. Flippers get a little bit of a discount for buying the home without guarantees and sometimes without inspections, because there is an inherent risk. They feel it’s a calculated risk. Some homes they flip for higher profit margins than others. Some require less work. But it’s not as easy as buying a home one day and turning around the next to make $100K on the deal. They generally must improve the home.
Your best deals are probably made behind closed doors at the bank. These are the bank-owned homes that the banks bundle in a bulk package and sell the entire package at one lump sum to investors. But they’re not going to make the same deal on one little house just for you and just because you asked. Not gonna happen.
Moreover, it’s not gonna happen on a short sale because the bank doesn’t own the home. The bank is simply considering allowing the home to sell at market value because they would get the same amount if it went to foreclosure. There is not a lot of incentive for a bank to authorize a short sale if the price isn’t right.
Sellers know this. Especially Sacramento short sale sellers who work with Elizabeth Weintraub, because I tell them. Every Sacramento short sale agent knows this. The bank wants market value. End of story. There is no point in submitting a lowball offer, working through 2 to 3 months of paperwork submissions only to be denied at the end because the buyer won’t move on price. Just say no to start with and get on with the short sale.
Some buyer’s agents get upset and accuse me of not working for the buyer. That’s right. When I am the listing agent, I don’t work for the buyer. I work for the seller.
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