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You are here: Home » 2013 » March

What’s My Home Worth?.

For years the main question I would get was, “What’s my home worth?” People were buying homes they couldn’t afford banking on the hope that the home was going to keep going up in value, and they did, for a while. Then the meltdown happened, and people stopped asking me what their home was worth but instead asked about loan mods and short sales.

Now, they are back asking about how much their home is worth again. Prices have recovered to the point where a LOT of people that were upside-down just a year or two ago now have hope that they actually get out of their home without having to do a short sale. Some of them even get surprised when I tell them they’ll actually get some money out of the deal!

The challenge we face now is that there is a lot of “noise” in our data. There are still a few trashed bank-owned homes out there dragging the comps down, and then there will be the pristine, super-upgraded home that will sell WAY high. And then there are the “suspicious” ones where I’ll see a home sell before it gets exposed to the market and sometimes it’s $50-75K less than what you’d expect it to sell for. On top of that, due to low inventory, low rates and high buyer demand, buyers are sometimes bidding homes up in a bidding war once they hit the market. So what I’m saying is that it is hard right now to really set an exact price for ANY home in our market!

If you’d like an “estimate” of your home’s value, I’ll be happy to run the actives, pendings and solds for you and do my best to give you my best guess on the value. Just call me or send an email to Brian@SharpHomesOnline.com and give me the address and some basic info about the home and I’ll send you back a report.

If you have questions on this or any other real estate topic, call me at (925) 240-MOVE (6683). To search the MLS for free and view virtual tours of homes for sale, go to: www.SharpHomesOnline.com. Sharp Realty

Respite For Renters?

Renters have had it hard the last few years. There has been more “renters” than “rentals” for a while. Many potential homebuyers were scared of jumping into the housing market when prices were collapsing and at the same time former homeowners were becoming renters after losing their homes to short sale or foreclosure. This means landlords could be fairly picky about who they’d rent their properties to and rental prices were increasing.

We may be seeing this situation thaw a little bit. We are seeing an increase in the number of properties for rent and that’s leading to a flattening out of rental prices. We are even seeing some rental price reductions as it takes longer to get a property rented out. Smart landlords know that it’s better to take $100-200 less a month but get it rented than to have it sit vacant for 2-3 months. [For the record, I’ve been predicting that rents would fall the last few years, and I’ve been dead-wrong!]

The situation that was causing rents to go up may be reversing itself. Potential homebuyers have gone from being scared of buying a home to being scared of getting “priced out” of the market if they don’t buy soon. And many of the people that lost homes due to foreclosure or short sale over the past 2-5 years can now potentially qualify to buy homes. So many tenants are really “wanna-be” homeowners right now who would rather buy than rent, and over the past year or two the number of investors buying homes to rent out has skyrocketed. So at the same time that demand for rentals is slowing, supply is increasing.

So if you are a tenant, just know that you may be gaining a little bit more leverage within the next few years to negotiate on rent. And if you are a potential landlord thinking of buying a home to rent, it would be wise to factor in a little “cushion” to your numbers. So if the property rents at $1,700 a month now, make sure you can handle it if rents drop to $1,500.

If you have questions on this or any other real estate topic, call me at (925) 240-MOVE (6683). To search the MLS for free and view virtual tours of homes for sale, go to: www.SharpHomesOnline.com. Sharp Realty

Prices Are Up!

Wow, what a turnaround! It feels like I’ve been writing doom and gloom articles for forever. But now I finally get to report on some POSITIVE things for a change! (Well, everything depends on your perspective. Rising prices are NOT great news for buyers…)

Our market definitely hit the proverbial “bottom” last year and it’s been appreciating rapidly since then. The average sales price for homes in our area is up a little more than 30% the past 12 months!

You always have to take housing numbers with a grain of salt. It’s often not as bad as it looks, or not as good as it looks, either. Back when average prices were collapsing, it was partly because the higher-end homes just weren’t selling AT ALL and a lot of the lower-priced homes DID sell, which brings the average down. Now it may be the reverse, in that we are seeing a lot of new builders re-enter the marketplace and they are putting their homes on the MLS to get more exposure, which can shift the average price higher.

But the bottom line is that all the band-aids on top of band-aids for the real estate market are starting to work. Yes, the banks and the Federal government have found ways to keep homes off the market that really should be on the market. Yes, the Fed is driving interest rates artificially low. Will we look back on this in 20 years as a big mistake? Probably. But for right now, the market is hot, prices are up, buyers are desperate, and it looks like it’s going to continue that way for a while. If this keeps up, pretty soon we’ll be talking about another “bubble” forming that is unsustainable. I don’t think we are there yet. I think this has some more steam left in the run before it gets to that point. But the basic math says if we go up another 20-30%, then we may be approaching “bubble” territory again because the average person will no longer be able to afford the average home.

If you have questions on this or any other real estate topic, call me at (925) 240-MOVE (6683). To search the MLS for free and view virtual tours of homes for sale, go to: www.SharpHomesOnline.com. Sharp Realty

CA Bill of Rights Update

The “Homeowner Bill of Rights” went into effect Jan. 1, 2013. The general purpose of the law is to do away with the ability of lenders to do something called “dual tracking” (when a borrower is trying to work out some alternative to foreclosure, yet the lender continues the foreclosure process). This is NOT an across-the-board foreclosure moratorium. Lenders ARE prohibited from foreclosing, but only in certain instances, and the rules are different if it’s a loan mod or a short sale.

For a loan modification, the lender cannot file any foreclosure notices (notice of default or notice of sale) and they cannot hold a trustee’s sale if the borrower has submitted a “complete” loan modification package and it’s being reviewed. The kicker here is that it appears to be up to the lender to decide what a “complete” package means. And stories about borrowers sending in documents, only to have the lender lose them are frequent. My advice is to document whenever the lender tells you your file is “complete.” They are supposed to acknowledge that in writing, but I’ll be surprised if that happens very regularly. If they do turn you down for a loan mod, they are supposed to do so in writing, and then they STILL can’t foreclose for 30 days, which gives you the ability to appeal their decision.

The rules for short sales are quite different, and actually quite inferior, in my opinion. The hold on foreclosure activity doesn’t start at application. It only starts once the short sale is APPROVED by all lien holders AND “proof of funds or financing has been provided to the servicer.” I know what “proof of funds” means (liquid funds sufficient to close the deal) but they don’t define what “proof of financing” means? Will they accept a pre-qual letter? Or do they require an underwritten pre-approval letter? Or do they mean formal loan approval? Or loan docs in title, signed and lender has funded? BIG differences between each of these!

If you have questions on this or any other real estate topic, call me at (925) 240-MOVE (6683). To search the MLS for free and view virtual tours of homes for sale, go to: www.SharpHomesOnline.com. Sharp Realty

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