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If You Can’t Buy a Home in Sacramento
How do you keep pushing on when the Sacramento real estate market is beating you down? I don’t know how some buyer’s agents are surviving out there in this desert of no inventory. One such veteran agent in Sacramento told me today that he is thinking about leaving the business. This is a dreadful market because there are buyers who will never buy a home in Sacramento in this market, especially if they are looking in Natomas or Elk Grove. It’s positively disheartening for many. At an open house in Elk Grove on Saturday we had more than 100 buyers come through. So far, we have almost 30 offers. Only one buyer will win.
Because I list so many homes in Sacramento, I see a wide variety of offers come across my desk. They range from lowball offers to asking price to 20% over market value. I can tell from those offers that we basically have two types of agents in Sacramento right now:
- The type of agents who talk to each other.
- The type of agents who work in a vacuum.
I also realize that a buyer’s agent can lead a buyer to water but she can’t force the buyer to drink. I’m not so sure that buyers truly understand what is going on. This climate makes me a bit concerned that buyers might blame their agents for their failure to buy a home in Sacramento when it’s the market and not necessarily the agent’s fault.
Years from now we might look back at this like the 1930s Dust Bowl. At least during that horrible episode in our country’s history it was pretty clear what was happening because you couldn’t see two feet in front of you. In Sacramento, everything looks normal. For Sale signs are in the yards. Agents are accompanying buyers to show homes. People are smiling. But it’s a nervous smile, and underneath they are depressed and worried and anxious. We need inventory in Sacramento.
Well, here’s my solution, because you know I have a solution, right? I’m not the kind of Sacramento real estate agent to paint this dismal picture and not offer you a solution. I’ve been in the business for almost 40 years, and that’s long enough to learn a thing or two. The first tip is if you’re gonna give up, then go home and crawl under the sheets and stay there because there is no room in this market for whiners.
The second tip is turn over the unturned stones. There are homes in Sacramento that are not getting showings. Not because there’s anything wrong with them. It’s because they are either overpriced homes, in need of repair, or on the market for too long. There is nothing wrong with a home that needs a little bit of work. All you need to do is adjust your attitude toward hiring a contractor or doing some work yourself. Often the prices of these homes can be adjusted a bit to compensate for the work needed. Align yourself to the fact that if you want to buy a home you need to look at all of the homes that are available and not just the cherries.
You want to know where the ants go, right? You follow the ant trail. At the end of it, you will find ants. It’s too simple of a principle for many people.
There are homes for sale in Sacramento that buyers and agents are ignoring. There is no competition for these homes. No multiple offers. No stabbing each other in the back and clawing your way over dead bodies to get to the top. These homes are sitting quietly, waiting to be discovered. Go out there and discover them. Find a way to write an offer and make it work. If you need help and want to buy a home in Sacramento, you can call the Elizabeth Weintraub Team. 916.233.6759. We’re putting buyers into homes.
Multiple Offers: Does it Matter Who Buys Your House?
Depending on to whom you speak, my position as a top Sacramento real estate agent could be enviable or unfortunate when it comes to giving my sellers intelligent advice about multiple offers and helping them to decide who should buy the house. After all, it is the sellers’ decision. It doesn’t matter if the home is a short sale or a regular equity sale, who buys the house is still the sellers’ decision. The seller owns the home and the seller is in control, making all decisions. I’m just that yappy little Yorkie in their corner trying to help them to make the right decision — which is the decision that is best for the seller.
As such, I sometimes slip on my sellers’ shoes, although I don’t walk very far in them. Like those Lady Gaga shoes. I’d probably break my neck trying to walk down the front steps in 7-inch heels. I step into my sellers’ shoes at times because I want to make sure they consider all of the information they need to make an informed decision and not just pluck a number out of the basket of multiple purchase offers.
You might be thinking, what’s the deal? The seller should take the highest offer, end of story. However, please hang on and bear with me; I propose there is more to the story. Whomever buys the house is the person who will take care of that house after escrow closes. After the agents collect their commissions, the seller pockets that big fat check, the keys tossed into a kitchen drawer and, lights out, everybody goes home happy as little clams, who bought the house might matter.
Was it an investor or an owner occupant? Why do you care? Does it matter who buys your house?
You care because it’s your neighborhood you are leaving behind. Your neighbors and probably your friends, the community in which you served, built memories and forged lasting relationships. Some of us believe we have a responsibility to leave the world in a better place after we touch it. One by one we can make a difference in our communities. We can help to transform and improve or we can help to destroy.
Sometimes, it’s as easy as deciding between what you would want for yourself if you were the person left behind. Or, what would you like to see in the neighborhood where you move? Do you want to move into a neighborhood as a homeowner in which half or more of the homes that were once owner-occupied have been converted into rental properties?
There are large groups of non-local investors buying up huge chunks of Sacramento for rentals and they are changing the face of Sacramento. These corporate investors are paying cash and do not always offer market value, either. Lately, I’ve been receiving lowball offers from these groups. Some are brash. I see unreasonable demands. And they are turning our neighborhoods in Sacramento, block by block, into rentals, away from owner-occupied homes, which once reflected our pride of ownership. Do first-time home buyers stand a chance against these cash-rich bullies? Who is helping the little guy to succeed?
Before you sign that purchase offer, think about does it matter who buys your house. You might have a choice. Consider what your mother might say. Then do the right thing.
The CalHFA Short Sale and CalHFA Financing
We are fortunate in Sacramento to have a wealth of information at our fingertips by our sheer location as the state of California’s capital. There are also a lot of really excellent real estate agents in Sacramento whom this agent over the last 10 years has had the distinct pleasure of working with, as well as your usual run-of-the-mill whack jobs. We won’t talk about the latter because they don’t deserve chatter, except to acknowledge the occasional irritant will pop up in this business and it’s best to just step over them and get on with the business of buying and selling homes in Sacramento. Keep a positive attitude, that’s my motto!
One of the highlights of lending in Sacramento is the California Housing and Finance Agency, aka CalHFA. They assist first-time home buyers buy a home by securing a small second loan to the home. For a brief time last week CalHFA had pulled all funding and threw the homebuying market into a further panic. But then something happened and suddenly I received a notice that the funding was restored. Not that it will help buyers in most markets because those buyers are finding they are getting clobbered by the cash and conventional buyers.
There is another problem some homeowners in Sacramento are facing with CalHFA, though. The problem that arises is when a seller needs to do a short sale and discovers that CalHFA loan that they forget about. Those CalHFA loans need to be paid or a small portion needs to be paid in order for the short sale to be approved. With CalHFA being a government agency, it involves red tape and the agency is backlogged. It cannot possibly deal with the number of short sales it is trying to approve within a reasonable time frame.
You basically have two choices nowadays with a CalHFA short sale. You either wait the 90 or so days for CalHFA to respond to your request for a short sale — at which point the first lender might close the file on you — or you pay it off. Last winter, I closed a CalHFA short sale in Natomas under unusual circumstances.
I told the buyer it would be at least a 90-day wait for CalHFA. The second loan was pretty small, less than $10,000. The way prices are moving in Sacramento, 90 days could mean the home would sell for another $10,000. It might be smarter just to offer to pay off the second, providing the first lender will allow it, and close. That’s exactly what the buyer did. Paid off CalHFA. Makes you wonder if the delay for this processing is meant to induce payoffs, but I doubt CalHFA is that together. I don’t give a government agency that much intelligence.
But on another CalHFA short sale, we’ve been waiting since the first week in November for short sale approval from CalHFA. Since yesterday marked the 90-day point that is allowed before escalation, I asked CalHFA to escalate. The first is Bank of America, which said it will not extend past the end of February. Low and behold a miracle happened. I heard goldfinches singing in the yard. The sun came out from behind the clouds. My cats stopped puking. Was that the first robin of spring hopping about?
The negotiator at CalHFA picked up the file and asked for a few documents. Be still, my heart. I’ll get right on that. I like to take care of requests immediately. So do most of my short sale sellers. The seller emailed the documents the negotiator asked for, I put together the reports needed and sent her the package. Within an hour, the short sale was approved. In one day! CalHFA approved it, and we’re closing in 2 weeks. This is the fastest turnaround ever. And naysayers believe a positive attitude doesn’t pay off. Spittooey.
A 3-Lockbox Friday for This Sacramento Agent
This Sacramento real estate agent should be adding 3 more homes to the inventory in the Sacramento area on Monday. It’s a small contribution to our sorry state of affairs in the Sacramento real estate market. We have fewer than 1,500 homes for sale in Sacramento at the moment, which is miniscule and does not meet the demand. This means when a potential seller calls to say he or she wants to put a home on the market, this Sacramento agent does her best to accommodate without delay.
I was driving back from Elk Grove where I have a lot of listings when I got the call to Rocklin. I seem to list and sell an unusually high number of homes in Elk Grove, even though I do not live there. I live in Land Park. Probably because so many are short sales in Elk Grove, and I am the best Sacramento REALTOR to handle short sales. Yet, a few that are not short sales are creeping into my listings. I closed a regular home in Elk Grove that comped out at the top around $245,000, and with one-eye closed and clenched teeth we pushed the limit to meet the rising pending demand to $259,000, yet it sold for all cash at $280,000.
Buyers are desperate to buy a home today. It’s hard to pick a sales price because it’s hard to predict how high a buyer might decide to go or how far out an appraiser will go to appraise. I realize sellers think us listing agents can pull rabbits of hats, but we can’t always predict what buyers will do. We can only guess. If your home is marketed correctly, the market will take you where you want to go. You don’t want to be too high because buyers will wonder what’s wrong with your home when you reduce. You don’t want to be too low because buyers might wonder upfront what’s wrong. You want to be priced just right, like Goldilocks and the Three Bears.
Which brings me to my 3 lockboxes from yesterday. One lockbox went on a home in Elk Grove that will be a short sale. Another lockbox went on a home in Elk Grove that will be a traditional sale, and the home is absolutely gorgeous. Don’t call me about it because you’ll get your chance to buy it along with everybody else next week. I don’t make side deals or give special considerations to my friends. I’m not that kind of listing agent. Don’t offer to let me write the deal in the hopes I will compromise my ethics and tell the seller to take your offer, because I don’t do that, either. Yada, yada, that’s not what you meant, yeah, right!
Another lockbox went on a home in Rocklin, which will be a short sale. It will need some work, and homes that need work are often a struggle with the short sale bank because the banks often refuse to acknowledge the homes need work. Or, maybe those darn BPO agents just don’t go inside. Hard to say, but it will be challenge, yet not a challenge that I can’t overcome.
Elk Grove in the morning. Rocklin in the afternoon. Back to Elk Grove in late afternoon. That was a lot of driving yesterday for a Sacramento agent who lives in Land Park. I love this business.
The No Drama Sacramento Real Estate Agent
Arthur Burke, a real estate agent in Sacramento has, on more than one occasion referred to me as the No Drama Sacramento Real Estate Agent. Probably because there are real estate agents who will yell and scream to get their point across, but I’ve never found that approach to be necessary. The truth is everybody knows you get more attention if you whisper. Does that stop some agents from bellowing at each other or their clients? Logic would say yes but logic doesn’t govern real estate nor some Sacramento real estate agents.
I recall once driving down I-80 with the top down on my car and my right hand trying to steady a giant cat tree in the seat next to me — not the safest thing to do with cars whizzing by at 75 MPH — when my phone rang. Even though that was not the most opportune time to answer my cell, I was wearing a hands-free Bluetooth device. The problem was I could answer it only if I temporarily removed either my right hand from the cat tree or my left hand from the steering wheel. It’s not like I couldn’t talk and drive at the same time, but trying to do so with a 6-foot high cat tree wobbling in the seat next to me probably wasn’t the smartest thing to do. If all of us always made the smartest decisions possible, though, Bandaids would go bankrupt.
Using my elbow to steer, I answered my cellphone. I had a lot of deals in escrow, many of which were short sales, and when banks call, a Sacramento agent better answer because she might not ever get back through to the negotiator. The bank’s call-back number isn’t just an 800#, it also involves a series of digits for an extension, sometimes up to 7 numbers, plus you need to know the last four numbers of the seller’s Social Security, including their middle initials, and the complete property address with correct ZIP code. Knowing I did not have any of that information available at this time as I sped past the bottleneck mess at the 99 South exit, I did not feel the least bit anxious about answering my phone.
It was a Sacramento real estate agent, and I won’t mention where she works because you might figure out who it was, and I’d rather not have to talk to her again. High, shrill voice. Screaming with accusatory tones. I had not spoken to this person for months. It took a while to figure out why she was calling and why she was so angry. She was upset because a seller she was representing had asked me to do a CMA for a home this seller owned elsewhere. I tried to explain that I did not call the seller, I did not solicit the seller, and we did not discuss the home the seller presently owns. After all, the seller is free to choose a different agent to sell a different property. Nobody owns a seller.
It made me wonder how this agent became a top producer when she screams at people. It’s one thing to scream when you’re right, which is not really justifiable, btw, but it’s another to scream when you’re wrong. I also tried to explain that this was not really the best time for me to be discussing our mutual client while driving down the freeway with this cat tree in the car.
She then began to scream at me for answering my phone.
There’s only one thing to do with these kinds of people. Click.
That action involved removing one hand from the steering wheel again. It didn’t feel like a life threatening situation at the time. Staying on the phone sounded like a life threatening situation. Whenever I see this agent’s name, I recall the experience in which I concluded I would rather face death than continue speaking to her. If anybody ever said that about me, I’d want to curl up and die. And that is one good reason I don’t scream at people. I don’t mind being known as the “no drama” Sacramento real estate agent.
