2013 vs. 2014 in Real Estate, Tina's Experience
Real Estate 2013: This year was a Seller’s Market. Homes were increasing in value, from one day to the next. Especially in Murrieta and Temecula. Realtors did their research, and priced homes accordingly. They listed the homes, and received anywhere from 10-30 offers on the home, within the first few days (I received 85 offers on one of my listings – a record breaker for me). Buyers had such a hard time competing against dozens of other buyers for a home, that many of them stopped working with a buyer’s agent, and went directly to the listing agent, feeling that the agent would know the best price that would get them the home, and would then have the perfect offer the first time, without losing the bid (I doubled ended 90% of my listings last year). The buyer’s agents, who did keep their buyers, wrote over-asking price offers, hoping this would get the offer accepted, in this multiple offer situation. For some (the inexperienced ones) they wrote them so high, that the homes did not appraise, and the buyer lost the home anyway. Unfortunately, for the ones that wrote over-priced offers on HUD homes, many were stuck with an over-priced offer that did not appraise and some had to pay the difference. Many other buyers’ agents wrote over-priced offers that actually appraised - surprising each party, because the homes were appreciating very quickly. In 2013, we saw many foreign buyers, purchasing the homes, for investment purposes. Homes in 2013, sold within hours, and at the most, a week. There were multiple offers, so agents presented several offers at once to different sellers. Many times, Multiple Counter Offers were sent out to the many buyers, and the bidding war began. In 2013, if you had a listing that was priced right, you were confident, that it would be under contract, within a week or two. If a buyer really wanted to get their offer accepted, they had to be very competitive, in more than just the price. The best offer situation was one where the buyer offered at least the list price, and oftentimes more than the listing price. They needed to write the offer without asking for seller concessions, or seller paid, buyer-closing costs. They did not ask for termite inspections, nor did they request repairs. Most of the homes were sold As-Is anyway, so a clean offer would not ask for anything. Although CASH offers were the strongest, we saw VA and FHA offers being considered just the same, because sometimes the CASH offers just were not the best. Most investors offered CASH, but it was for less than asking price, because the investor needed to be able to buy, fix, then flip and make their profit. On occasion, the investor would bid on a home, then become impatient with the length of time it took to close, and already moved onto another listing, only to walk away from yours. This made Conventional, FHA and VA loans more appealing, because the buyers had personal interest in the home, and placed more value on it because it would be their own home. Buyer’s who loved more than one home, and wrote an offer for it, realized that by the time they found out that their offer was not accepted, the other homes that they loved were also already under contract with other buyers. Because buyers were losing to the competition, the Buyer’s Agents wrote offers on more than one home, at the same time. They figured that if one didn’t get accepted, they still had a few more offers that had a chance. Many agents had their best year, in 2013, and if you listed a home, you were almost guaranteed to close the transaction, if not for the sellers only, then also representing the buyers, making it a Double-End. Listing Agents could ask for more commission for themselves, and less for the Buyer’s Agent, because buyers were in abundance, and you knew the home would sell.
Real Estate 2014: Home prices are beginning to stabilize. They are still increasing in value, but over more time than last year. Buyer’s Agents are finding that there is not as much competition on the homes, this year. They are lasting on the active market for 2-3 times the length of time, before going into contract. It seemed like January 01, 2014, brought about a whole new market shift. I recognized this change, almost immediately after the new year was brought in. Experienced agents are performing their own value reports on homes, and making offers according to what their own researched value is. They are researching the seller’s mortgage history, and writing the offer based upon what the seller owes, and also what the true value of the home is. This year, I have written numerous offers, and have been pleasantly surprised; that EVERY offer I have written is being accepted. I have made offers for less than the asking price, by researching the true value. I have asked the sellers for seller-concessions, and also asked for a home warranty, termite report, and other inspections. I have challenged Listing Agents to justify the listing price, when I did not see the value in the asking price. You almost never see an over-priced offer, this year (at least from a Realtor with experience). Buyer’s agents can ask for their own escrow company, or their own title company, and oftentimes, they negotiate at least one of the two. I notice that many inexperienced agents are taking listings and over pricing them just to gain the seller’s contract. Many inexperienced agents write the offer based on the list price, without doing their own comparisons to find the true value. This is a mistake that an experienced Realtor will not make. If you over price a home, it will sit without selling. It serves no purpose to take a listing that you cannot sell. And when it sits for too long, you look bad to everyone…the sellers, buyers, other agents, peers, because your inexperience can look like lack of ability to sell a home. An experienced Buyer’s Agent should be writing the offer for true value, completing any reports necessary, before writing the offer. Their fiduciary duty is to the buyers, and that means offering a price that is competitive, yet reasonable. As an experienced Realtor, I make sure that your home is priced competitively, and within market value. I wont over-price your home, just to get the listing, but I will get you the most value for your home, in the least amount of time. I will make sure that you are the most educated seller on the market! My marketing and Internet exposure will make your home visible to Realtors in almost every county in California, and buyers all over the world. As a buyer’s agent, I educate my buyers so that they understand the market, tax rate, HOA, and anything that they need to know, to purchase a home with confidence. I write offers according to real value, even if it is less than what the asking price is. More homes are for sale, balancing out the buyer/seller ratio.
One thing that 2013 and 2014 have in common is that it is definitely the perfect time to buy, and it is also the perfect time to sell! Homes have increased in value, reversing the upside-down market, and making it the right time to sell. Buyers are able to take advantage of the affordable market, before the prices increase right out of their own affordability. Interest rates are still at a low, making the mortgage payment affordable. Experienced Realtors will make your dream come true…buying or selling! If you are buying your first home, your seventh home, your investment home, now is the perfect time! I am an Owner Investor Certified Professional. Whether this is your first investment or you are a seasoned investor, I am the right agent for you! Buy or sell you’re your home with an EXPERIENCED Realtor, by starting NOW and by starting HERE!