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Sacramento Agents Display Patience for a First-Time Home Buyer
Many first-time home buyers find Sacramento Realtor Elizabeth Weintraub on their cellphone.
So many first-time home buyers in Sacramento find my name in Google when they are looking for property. All they have to do is put in a property address and much of the time, my website shows up. I’m not entirely certain how or why that happens, but I bet it’s because I am outrageously active online and have been in the real estate business forever. You can’t hardly click on a website about Sacramento homes for sale without finding my smiling face. It’s a tough choice for consumers, but not nearly as tough as some would make it.
Not nearly as tough either as, say, choosing the winners for the Songwriters Hall of Fame in 2016. The way I read the nominees and how they vote, the members eligible to vote can choose to vote for only 3 non-performing nominees, two performing nominees and one dead person. This hardly seems fair when the two dead people up for nomination are George Harrison and Jimi Hendrix. Both were incredibly talented and made an enormous impact on the music industry through songwriting.
But you know who will probably win, the older guy will win. The one who has been around longer and with whom more people identify. Much as I love George Harrison, I really wish Jimi Hendrix would win. Not just because he’s part of that rock-stars-who-died-at-27 group but, like Paul Allen has publicly expressed, Jimi Hendrix holds a special place in my heart as well. Part of that appeal could be due to LSD, hard to say, and I don’t think Paul Allen would argue that point. Allen still has a museum display honoring Jimi Hendrix at the Experience Music Project, which my husband and I had visited in Seattle when it opened but has over the years morphed into something else called EMP.
Tough choice, that dead person category. Not so tough as to which agent to work with in Sacramento. A first-time home buyer called yesterday to ask about condos in the Pocket and what he thought was my listing. It had my name on it, he said. He could not remember where he saw the property except that it was online. I am so many places online that even I don’t know where all of my marketing is these days. It’s everywhere. Still, even though it wasn’t my listing, I offered to help. It was only a $100,000 condo, but if I didn’t help him, who would?
Not only was that condo in pending status since June — June? Hello? Nothing can be pending since June unless there is something very odd going on. It was originally pending short lender approval and since June pending? That’s unlikely. But I also noticed a withdrawn listing that was the same model. Now, we have several avenues to pursue and follow up for that buyer. At least he is on automatic listings now so whenever a new condo hits the market, he will get that listing, and we might be able to show him both of the other condos. One way or another, we will help this first-time home buyer buy a home and close escrow.
Should a Sacramento Home Buyer Cancel Escrow?
A home buyer called yesterday to ask if she could cancel her escrow, dump her buyer’s agent and become a client with the Elizabeth Weintraub Team. She was very unhappy with her present real estate agent’s performance, but I suspect that unhappiness was due more to miscommunication than inability or inexperience or monkey business. And, like many first-time home buyers in Sacramento, her escrow was a short sale. See, unless you’re a listing agent who sells hundreds of short sales — and there aren’t very many of us in Sacramento — an agent probably won’t have the answer to every single piece of drama that can pop up in a short sale. No answers = client confusion.
This buyer was concerned because HSBC had twice increased the sales price. Is this normal, you might wonder? Yes, it is. There are many reasons for a price increase during short sale negotiations. There could be several BPOs. The servicer might establish a market value that is different from the price point determined by the investor. Not to mention, prices are inching upwards in Sacramento. I closed a Roseville short sale last week that had 3 price increases during processing, and the last adjustment exceeded 10%. A short sale condo in Rancho Cordova was bumped more than 20% when a buyer balked and walked and a new buyer stepped in.
Her suspicions were aroused because the price increases were not presented to her in a formal manner — via a worksheet or letter from the bank. Instead, the listing agent had called the buyer’s agent to provide the verbal communication. The buyer felt this procedure was unprofessional. Yet, that is the procedure for most short sales. I don’t blame a buyer for being wary. I wouldn’t like it if I was simply informed that I needed to pay $10,000 more without proof from the bank nor an appraisal to justify, but that’s how short sales work.
The thing is if a buyer doesn’t want to pay it, another buyer will pay it. That’s what the bank is banking on. And the bank doesn’t care. You might think the bank cares that the home needs paint, new carpeting, the roof leaks, but I’m telling ya, the bank doesn’t give a crap.
In this particular instance, the buyer disclosed she was FHA and applying for the CHDAP program. Holy toledo, the only thing more problematic than that would be a VA buyer and, even then, it would be a tight race. In fact, a VA buyer might have an edge over a CHDAP. The basic way to close a CHDAP in a short sale is to get a short sale extension. A short sale extension is not always possible.
My advice to this buyer — after telling her I can’t give her advice because she’s in contract and under agency with another agent? My solicited advice was to stay in escrow. For heaven’s sakes, don’t cancel. She does not realize how lucky she is to be in escrow and be buying a home in Sacramento. For every buyer who wants to buy an entry-level home in Sacramento, there are 9 more who won’t be able to buy. They will get beat time and time again by cash investors or conventional buyers. Buyers would give up their eye teeth to trade places.
Welcome to our Sacramento housing market in the spring of 2013. If you’re in escrow, stay put and don’t whine.
A Day in Tahiti is One Day Too Long
You know the adage if a tree fell in the forest? If you don’t know that something exists, you might form your perceptions around that which you do know, because you’ve got nothing else to go on. Your reality is formed by your own beliefs and experiences. And in that way we all create our own reality, regardless of whether you realize it.
For example, when I was in my 20s, I used to think a great vacation experience would be to stay at a place like the Disneyland Hotel. To have room service, a real soft bed (instead of a waterbed) and peace and quiet. Today, not so much. That’s not because I’ve turned into some other weird haute person, it’s because I’ve discovered there are other options that don’t involve sharing your space with 50 million other people.
There is a place in French Polynesia that is home to one of the largest atolls in the world. An atoll is a place where the island has sunk in the middle and all that is left is the coral reef, which has long ago died and today is covered with sand, grass, plants. I swear, the weather is perfect; the water turquoise, brimming with tropical fish; and the resort boasts a small string of modernized and updated over-water bungalows.
I can see why a day spent in Tahiti is a day too long.
There is a first-time home buyer I referred from Sacramento to an agent in another town where I don’t work. The home buyer sent me a dramatic email a few days ago, begging for a new agent. The reason she did not want to work with the agent I referred to her was because the agent refused to answer her questions about the ethnic make-up of a neighborhood. No matter how we explained it to her, the buyer could not understand that federal Fair Housing law prohibits the discussion.
This is an agent to whom I will definitely refer more business.
Sacramento Home Buyers and the Light Fixer
What is too much work for a first-time home buyer in Sacramento? I always follow up on my listings by emailing buyer’s agents after a showing. I thank them for showing my listing because I am grateful for their efforts. Also, I realize it’s tough being a buyer’s agent today. Buyer’s agents have to write a lot of offers and face a lot of rejection. When I ask buyer’s agents to tell me what their buyers thought of the home, sometimes they say their buyers felt the home required too much work. It makes me wonder how a buyer who has never owned a home before knows how much work it needs. Or, is the work required merely an overblown perception?
It’s no secret that most home buyers want a turn-key home. They don’t want to do anything but move into it, like it is a rental. They also want a good price, sometimes an unreasonable price, which is why some buyers gravitate toward short sales and foreclosures. But the days of those below-market values are gone. Poof. Over. Short sales and foreclosures, like any other home in Sacramento, are selling at market value and, in many cases, way over market value.
That’s if you can buy a home. Some buyers can’t. There are not enough homes for sale for every aspiring home buyer in Sacramento today. So, if a home needs a little bit of work, why not find out how much work it needs? Maybe it’s not as expensive as you might think. For example, maybe it needs paint. High quality paint costs about $25 a can, cheap paint is $10 a can. You need 2 cans of paint to paint an average bedroom. Maybe it needs a $50 light fixture? That involves connecting the black wire to the black wire, and the white wire to the white wire, and the ground to the neutral. It’s not that difficult. But don’t take my word for it. And don’t touch electrical without turning off the power.
Why not buy yourself a home improvement book and learn how to maintain your home? Take care of the smaller projects yourself. If you’re in the market to buy your first home, believe me, something eventually will break or go wrong, and you’ll find great relief in knowing how to fix it.
I have written a series of articles about Buy, Fix and Sell, involving my own personal experiences of home buying.
A Home Buyer Almost Lost Her Rosemont Home
I just closed escrow on Friday for an incredible couple of sellers of a Rosemont home who had moved to Florida. They had owned a rental property in which the tenant had vacated and it was now time to sell. An agent in Florida referred this couple to me. I think the agent found me through one of my blogs and noted that I sell homes all over the Sacramento area. Because I sell so many homes (100+ /yr), odds are I probably sell a lot in any one area, and Rosemont is one of those neighborhoods for me. I know it pretty well. And I knew this particular home might pick up comparable sales from a nearby subdivision, which has a higher per median square-foot-cost than the surrounding neighborhood. Which meant if we positioned this correctly, the sellers could probably get a bit more for this home than they would otherwise.
I look to maximize profit for my sellers. That’s because I really enjoy what I do. It makes my sellers happy as well. I feel like I’ve done my job above and beyond when sellers walk away with a lot more money in their pocket than they thought was possible. Being a Sacramento real estate agent is one of the greatest jobs in the world. Being a top producer is even more fun, if you can imagine that.
The sellers had finished painting, making a few repairs, and buying a new microwave. The home in Rosemont looked great. Even the door knobs glistened. A bunch of offers arrived. One of them was all cash from an out-of-state investor (warning bells), but the buyer’s agent swore up and down the investor would perform. Easy peasy guy is what he said. Exact words. Except the investor was anything but easy peasy and the agent failed to respond to requests for documents. My recommendation to the seller was to drop the buyer. Fast. Like a hot potato. Because the Sacramento real estate market is too danged hot in itself. It’s a seller’s market right now, which means there are a lot of buyers competing for limited inventory.
Sure enough, we went back into escrow immediately with a new buyer. She wasn’t cash, though. She needed an FHA loan. And the appraisal came in a little bit lower than the asking price. That’s the problem with buyers who use financing. They must rely on a Sacramento appraisal. If they don’t have the cash to bridge the gap between the appraised value and the sales price, they risk losing the home. The difference wasn’t that great, though, and it was still more than the seller had hoped to receive, so the seller elected to move forward at the new sales price.
See, that’s the problem with an appraisal. Appraisals are not chiseled in stone. An appraisal is just somebody’s opinion of value. Could be a person of great integrity and intelligence who prepares the appraisal or it could be a lame-ass doofus who couldn’t find his way home with 3 maps and 2 flashlights. You just don’t know who you’ll get.
After we moved forward with the appraisal, the buyer’s lender simply could not close. It’s like an epidemic sweeping Sacramento: lenders who can’t close. Not on time anyway. They might say whose time frame are you looking at — is it the purchase contract that gives us only 30 days, which isn’t enough time to brush our teeth much less brush our hair? Or, is it our time frame, which is somewhere south of the border, west of the International Date Line and in another century?
The escrow dragged on and on and on. The buyer’s agent submitted an extension. Then another extension. The sellers questioned whether they should sign it. At this point, it might make more sense to just rent out the home in Rosemont, put it on the market next spring and deal with the new influx of buyers. Or, not. It was enough to give the buyer a heart attack. See, this is the importance of selecting a mortgage lender who can perform and not some group that can’t close on time. Because, as a buyer, you could run out of time and the seller could cancel the purchase contract, hand back your earnest money deposit and say nice to know ya; don’t let the door hit ya in the butt.
But these sellers elected to close escrow and extended. It made no difference to me because a commission now versus a commission next spring doesn’t matter; besides, I want what is best for the seller. Who it mattered to was the buyer. The buyer was a first-time home buyer. My agent who picks up my lockboxes after closing said the buyer was very grateful when he stopped by yesterday. It’s nice to have a happy ending. Happy sellers, happy buyer, happy buyer’s agent. What else could you want? How about a happy referring agent in Florida? Yeah!
