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Sacramento Will Be Featured in Financial Times
Just to show you how it goes in the life of a Sacramento real estate agent, last week I didn’t put any new listings on the market yet, yesterday, I worked on four new home listings in Sacramento, plus I gave a film interview to the Financial Times. That particular media is covering the collapse and recovery (or what-have-you) of the housing market across America. Because Sacramento was hit so hard by the real estate market-crash asteroids in a double whammy (2005 and 2008), and because we’re one of the first cities to begin our journey down that Yellow Brick Road, our town is of interest to the Financial Times, along with Austin, Texas, and a few others.
The morning started out innocent enough, an office meeting with my peers, during which I briefly and without actual intention mentioned a duplex I am listing in Tahoe Park. During the day, I received 3 phone calls from real estate agents about it. OK, this listing will be hot. It might even receive multiple offers. I conducted my visual inspection of the home a short time later and, as I lifted the door to the electrical panel to determine the amperage, the seller asked how I could read the label. She was stunned, watching me.
Hey, I might be an old fart but I wear monovision contacts. I am also a Baby Boomer, and we are not wearing reading glasses or bifocals if we don’t have to, and we don’t. I explained how distance and near vision works with this particular type of contact lens, and probably opened a new door of possibilities for the seller.
I spent about 30 minutes with a couple of my team members showing how to analyze a listing in MLS and various methods to pull comparable sales. It’s amazing how much information a buyers’ agent can glean about a listing in Sacramento if the agent utilizes all of the tools available. Knowledge is power.
Wednesdays are also my day to complete any last-minute open house schedules for the weekend. This weekend, Lyon Real Estate is holding its Open House Extravaganza for the month of May, so it’s very important to participate with such wide coverage for my sellers. I lined up a bunch of homes, matched with fabulous open house agents, and updated all of my online listing data because I like to tweak the listings myself. I’m such an odd duck, I guess. I do all of my own work on my listings because that’s my focus, it’s what I enjoy.
The best part of any Sacramento real estate agent’s day, though, is calling her sellers to announce their home has closed escrow — and a home in Roseville did close yesterday, less than 6 weeks after we went on the market. List price, all cash. West Park subdivision, at $375,000.
My team member Linda Swanson is filming with the Financial Times today, showing the reporter around Sacramento. I’ll let you know when this news story airs. I can tell you that although my life is pretty much open book, and my opinions are strong, leaning far to the left, I still prefer talking to the Financial Times over 60 Minutes any day. Some of those guys have accents.
Your Real Estate Problem is This Sacramento Agent’s Challenge
If you’ve got a problem with a home in Sacramento, come on over here and sit down next to me; I’m happy to talk about it. This is what I do all day long. As a busy Sacramento agent, I solve real estate puzzles and problems. I get to hear about some of the wildest situations, and I find a way to put the pieces together and close escrow.
It doesn’t matter what the problem is or the perception of that problem. I’m a good Sacramento agent to take care of it. Not every problem a seller perceives is actually a problem. Moreover, there is not much I haven’t run across or had to deal with in some form over the years, knock on wood. OK, I’ve never had to supervise the digging up of a grave in the front yard, so I suppose my time is coming. I’ve never had to drink milk directly from a pail toward which a cow’s udder was recently directed; oh, ick, I am such a city girl. There are few things, though, I have not done.
A few weeks ago I listed a home in Sacramento County that was pretty much trashed from one end to the other, and it was a big surprise for the sellers when they saw it. The tenant died in the house. But you know, the dude was watching one of his favorite programs on the TV Land channel: Bonanza, and he died peacefully in an overstuffed lounge chair. That’s not a bad a way to go; especially with everything being all right with Joe and Hoss on the Ponderosa. There were no cliff hangers on Bonanza. Every show neatly tidied up its drama. When I bite the dust, perhaps I’ll be watching Tattoo screaming: the plane, boss, the plane.
Another seller has a home with orange walls that I’m looking at later on this afternoon. My recommendation will be to paint the walls a light beige. Paint is kind of expensive when you figure it’s about $25 a can, and you need at least 2 cans of paint per room, but it’s the cheapest way to improve a home and get top dollar. You can also hire a pro for $300 to $500 per room.
There is the seller who had to turn off the water in his vacant home due to plumbing problems he couldn’t afford to fix, not to mention, the roof is beyond its end of life, and the payments are in arrears, have been in arrears for several years, but still, this might not be a short sale, and I am hopeful that I’ll find a first-time home buyer for this home in Elk Grove. I know other agents probably would not touch this listing with a 10-foot pole, but not me. I’ll take on the challenges.
The more challenges I solve and close, the better Sacramento agent I become. I’m still selling millions per month on average, even in today’s slower real estate market. You need a listing agent? You call Elizabeth Weintraub at 916 233 6759. I’ll be there.
How Not to Flip Your Sacramento Home
Can you make $100,000 profit on a Sacramento home you bought last summer and flip it? To clarify the answer further, let’s say the home was purchased at market value, the price at which most homes in Sacramento sell. Forget about the fact that the home abuts a gated community, and it’s not actually located in the gated community but instead is situated on a busy street with traffic. The caller wanted to know if she could make $100,000 profit, darn it, she wants to flip. Flipping the home is her goal because she and her husband no longer want to own this house.
Why don’t they want to own the house they bought only last summer? Because the work commute to San Francisco is too long. The sellers underestimated how gruesome it would be to drive 2 hours each way every day to go to work. So, now it is imperative that they make $100,000 profit and dump what they view as a bad decision. They’ll just flip it. They watch cable TV.
I tried to explain to the seller — without looking up the sale of her home or anything about it — that our market experienced its big appreciation in 2012. The first half of 2013 brought more appreciation and we saw another leap. But we’re pretty much done jumping around at the moment, and the market has been fairly stable since last July. I wondered what she thought would make her home worth $100,000 more than she paid for it, plus the costs of sale to flip it.
To get the answer, I go where I usually go when I’m looking for horribly bad property information that is widely available to the unsuspecting public — which is Zillow and its Zestimate. Believe it or not, this time Zillow wasn’t that far off on value, maybe by only $20,000, so it wasn’t Zillow’s fault. I pulled up listings in MLS to see what else was for sale in her neighborhood because sometimes it’s another home for sale in Sacramento that makes sellers think they can get more for their home. Hey, it’s down the street and on the market . . .
They don’t always realize that people can ask whatever they want. They stick any old price tag on it and find a real estate agent who is willing to list that home for sale. Sometimes, believe it or not, that Sacramento real estate agent could even be me as I don’t always turn down overpriced listings with potential — because those homes could sell someday for less, and I’d like to be that agent when they sell. It’s not my home. I do inform my sellers if I believe the price is too high, but it’s always their call because it’s their property.
Sure enough, I found a home for sale that is listed at about $100,000 more within a half-mile radius. It has a ton of upgrades. Quiet street. Nicer location. Bigger property, single level, and in fact wasn’t really a comparable sale at all in the world of Sacramento real estate. The potential seller who contacted me had a solution for this though, she could put in $50,000 to remodel her home and then she could make $100,000. Is she a professional flipper? Don’t think so.
And this is what HGTV has done to the minds of otherwise normal people.
The difference between me and the other two real estate agents she called? I talked to her. But my name would be mud if I encouraged her, and that’s just not the right thing to do. It means I won’t get the listing, but that’s how it goes.
How to Profit from a 50% Pending Home Sales Fallout in Sacramento
It pays today to be a home buyer on a backup offer in Sacramento since we seem to be experiencing such a high cancellation rate on escrows; in some cases up to 50% of the pending sales are falling out. I say this not to be an alarmist but to point out what other real estate experts are too frightened to bring up because they are worried this kind of data would harm our fragile sales market. Every real estate professional, just about, knows this is happening in the Sacramento real estate market, if they’re doing any kind of business. They’re just not talking about it.
That’s because we have to be positive and spread only good news about Sacramento real estate. Oh, spittooey. You’ll read in other news media that sales are UP. What media is not telling you is real estate sales naturally increase in the spring. Inventory is low, which is true, inventory is low as compared to previous years, but it doesn’t matter because there aren’t enough buyers for it. Home buyers today typically lust over only the best home on the block and the rest are ignored.
On top of this, buyer’s agents think they are working with buyers because buyers tell the agents they are buyers. They might even pop up with a pre-approval letter in possession. But it doesn’t mean they are a buyer, because a buyer closes escrow and eventually ends up with a home.
It’s not the end of the world if an escrow cancels, because it will generally turnaround and go back into escrow again under a second purchase contract within a relatively short period of time, but that’s why you want to be a backup buyer, if you can. Don’t think you can’t write a contingent offer, either, if you have a home to sell, because sellers are accepting contingent to sell offers from buyers.
For other listing agents, my advice is don’t put that listing into pending status until the buyer has deposited funds into escrow, which should occur within the 3 days MLS gives us to change the listing status. Because nobody wants to deal with the unfair stigmatization of a back-on-market listing because some doofus buyer on a whim canceled the escrow.
For buyer’s agents, don’t write multiple offers when your buyer can’t afford to buy each of those homes. Not only is your reputation as a Sacramento real estate agent at stake, but those types of “buyers” can easily morph into a vanishing act after both offers are accepted. If your buyers really want a pending home, consider writing a backup offer.
For buyers, get over the fact that homes might cost $100,000 more today than they did 3 years ago. Those days are gone. But prices are still low as compared to the prices pre-market crash. Don’t wait for interest rates to go up and slowly rising prices to price you out of the Sacramento real estate market all together. Get in while the getting is good, and for heaven’s sakes, stay there.
When a Sacramento Real Estate Agent’s Reputation is All That Remains
It wasn’t that the buyer’s agent forced me to open Microsoft Word — which takes so much longer than any of my other applications to load, patience, patience, to find the document in which I record decades of unpleasant transaction notes — it was that many real estate professionals may now associate this particular agent’s name with unethical real estate practices. After the day is said and done and the years are over, and all the crazy people have crawled back into their caves, the reputation of a Sacramento real estate agent might be all that lingers.
An agent’s reputation should be fiercely maintained.
Successful agents, for example, are often slid under a microscope to study. Sometimes these agents are unjustly attacked by other real estate agents for stupid reasons, mostly because competitors become jealous. It’s the nasty underbelly of the real estate business and a silent consequence of success. Aspiring agents admire success but it can also be a tug-of-war internally for them. Regardless, we all need to treat each other with respect. As REALTORS, we must adhere to the Code of Ethics.
To be kind, some agents can experience, let’s say, a lapse of better judgment.
For me, I don’t look so much at what other people say when they screw up, I look at what they do. If a buyer’s agent calls me to talk about a client’s offer, spends a long time discussing the buyers’ love affair with the home but fails to mention that the agent has written a second offer for that buyer, well, not only is it considered unethical, but that kind of practice could be against the law. Buyers can’t buy two homes if they can’t afford to buy both. Lawyers can scream this until the cows come home and agents don’t listen.
As what happens in these types of problematic situations is both offers tend to get accepted. At that point, the buyer’s agent had another open window to say, hey, I have something to disclose. But no, the agent’s lips are zipped until the buyer bails on both accepted offers. Ordinarily, a listing agent wouldn’t even know this has happened, but when she discovers it — and the truth often manages to come out — she’s not the only person. Both sets of sellers know, and so do all of their friends. The people at title and escrow know. The other agent whose seller received a cancellation knows. All the people that agent knows know. And so on.
This is how a buyer’s agent’s reputation can turn into mud.
And for what? A pair of buyers who bailed on the buyer’s agent and decided not to even to move to Sacramento after all?
