Is the housing market shifting, an opportunity for some?

Is the housing market going to start shifting in the direction of price reductions at the higher end of the spectrum? According to Zillow Senior Economist Aaron Terrazas, it could happen. Approximately 14 percent of homes for sale underwent price reductions back in June, and most of them happened at the more expensive levels.

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Over the last two years, the housing market has tilted sharply in favor of sellers. But this might be an early warning sign that the tide is turning a little bit. Although it’s too soon to officially call this a buyer’s market, this data does indicate that the trends in the housing industry may be normalizing. In speaking to my title rep, Jason Webb at Fidelity, I asked what he is seeing in the industry. His response was that there are currently more contingent offers, homes taking longer to close, and more demands to close escrow. I am personally experiencing all that in one escrow and it is not fun!

In my situation, the sellers have already moved and the buyer (who did not have a contingency on selling their condo) is delayed on it closing by three weeks. It was originally supposed to close by tomorrow. The agent representing the seller of the condo and the buyer on my listing is a rookie agent who has not been great at communicating the status. My sellers are frustrated and gave a demand to close escrow, but it was really to get them to push on the buyers of the condo, as I had no control and no authorization to speak to them.

We will now most likely close in another week on my my clients’ home because the buyer decided to go out and buy a new car. That caused his debt-to-income percentage to be too high, and now the car has to be paid off with proceeds from the sale of his condo. That causes further delays in our closing because the lender needs to see it get paid off. Another interesting component to this was that my clients Google’d the buyer and the results were…surprising. We knew it could be a challenging process, but we didn’t think it would be this much of a wild ride!

I believe we will see more of these types of issues as the market softens and reverts to a better balance. We can’t keep increasing, and it is time for the market to come down off this upward trajectory. There are some positive outcomes to a correction, but it is change and change is hard for most people; especially sellers when they still expect a higher price than their neighbor.

Silicon Valley: Moving East?

I came across a very interesting article in The New York Times recently about Silicon Valley attempting to find fertile ground in the Midwest. It’s a fascinating look at how the real estate market in the United States is rapidly changing.

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For example, Amazon is looking for a city to place its second headquarters. That is going to lead to a massive shift in where large tech companies start looking at places to re-locate. It’s well known that California is in a real estate a bubble. Silicon Valley, especially, is one of the richest areas in the entire country – if not the world – and one move could shake up a local economy in a huge way.

I think trying to replicate another Silicon Valley would be difficult; it is like the perfect storm – top-notch universities, a port, three international airports, the gateway to the far west and great weather. However, companies will look for more affordable areas to do business and states that provide tax incentives (think Tesla in Nevada). It doesn’t mean they will ditch the Bay Area completely.

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You know things are crazy here when even the tech elites in San Francisco are tired of San Francisco. They say it’s “congested” and “expensive” in the Bay Area, and are apparently mesmerized by the affordable homes and real estate in the Midwest. If you live in the Midwest I wonder how many hip spots would there be, not to mention the possibility of snow…what are your thoughts?

Tips Before You List – Economical, DIY Home Improvements

remodelWhen preparing your home for sale, statistics show staged homes sell faster and for more money than non-staged homes.

However, if your house is already a picture from Architectural Digest or your budget is limited, I am sharing a few tips from BuzzFeed about how you can make a few inexpensive, DIY upgrades to your house to increase the value and improve its aesthetics before listing.

Adding paint in certain parts of the house, evaluating house plants, replacing light bulbs, landscaping and giving your home a good, deep clean are examples of a few things you can do to improve the look of your home before listing.  You, the homeowner, can do quite a bit to significantly raise the value of your home and increase interest among prospective buyers.gardening

For the most part, these projects can be easily completed by you or a handyman and the materials are relatively inexpensive. If you’re willing to put in the time and effort, it may pay big dividends in the end.

Selling your home is an investment in your financial future, and the more TLC you put into it, the more you’ll get out of it. Should you need some recommendations for a handyman, gardener or painter, give me a call. I also provide a free consultation on things you can do to help spruce up the home and get it market-ready.

Check out BuzzFeed’s list for some ideas here.

Why It’s Important to Hire a Landscape Architect

Yard 1Last year, my sewer kept backing up and I found that I needed a new sewer lateral. My front lawn had a bunch of crabgrass, and the lawn never seemed to get green enough. Then, with the drought, I just let it go.

My whole front yard was torn up, so I decided to do some landscaping – new grass, plants and an automatic sprinkler and drip system.

The project turned out to cost much more than I expected. The sewer lateral was $6,000, and then I ended up paying an additional $8,000 for the landscaping and sprinklers.

I thought I was getting a deal, as the person I hired was a personal friend – though he admittedly knew nothing about plants – who could plant the yard and put the new system in.

Turns out, it was much more difficult than either of us expected. This is on me for thinking it would be an acceptable, cheap way to get the yard done. I still wonder if I hired a landscape architect, would I have saved money and would I be happier with the end result?

Of course, no home improvement project is as simple as it seems. My sprinkler heads had faulty gaskets and some of the plants were not getting water and I lost plants. Luckily, Admirals Choice, who installed the sprinklers, is Yard 2replacing them at no cost to me.

A year and a half later, we are still working on the grass, there’s still a line in the grass where the sewer lateral was dug out, and I need to get rid of the weeds.

We put weed killer on it, but I had to wait until the weather cooled, then it didn’t kill my stubborn crabgrass, and the rain began. So…I waited some more.

The gaskets should be replaced next week, then hopefully it will be time to seed before it gets too hot, and then I can fill in the plants that died.

So, with the hope that you don’t end up like me, with a two-year-old front yard project that cost me a fortune, I am sharing a great Houzz article on Landscaping Trends: