Many, many years ago, when I was a new agent, a friend of mine (who wasn’t a Realtor) suggested to me that being a listing agent takes knowledge and skill but “anyone could drive buyers around in their car”.  I was stunned that she could think that buyers’ agents do nothing more than drive from house to house and unlock doors for people. 

Lockbox and Keysafe Set

Last weekend I held a listing in Saratoga open and a young couple asked me if I could work with them in writing the offer on that home.  This happens a lot – buyers are out searching on their own, independent of any professional real estate guidance, and when they find a home they like they just “use” the agent who’s got the listing.

Apparently, the old view and the current one aren’t so different from each other.  It amounts to this: who needs a buyer’s agent?
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How much extra money will it take, beyond the downpayment, to purchase a home in San Jose or Santa Clara County? The answer varies, depending on what, where, and how you buy. Today I’ll offer some general information on home buyer’s closing costs in Silicon Valley.

Just need a rule of thumb on the costs? A generalization, a really rough estimate is two percent of the purchase price, but your actual figure could be substantially more or less. If your loan is a “zero point” product and if you do not need to pay for inspections, your costs should be between .5% and 1% of your purchase price. If you buy a home that needs a lot of inspections and specialized ones to boot (structural engineering report), your costs will be higher.

What makes residential real estate closing costs vary so much?

• The City of San Jose charges a transfer tax which is normally split 50/50 between buyer and seller. The cost is $1.165 per thousand each for buyer and seller (so for a $600,000 purchase price, $990 each)
• Short sales and bank owned properties usually do not have pre-sale inspections available, so you will need to pay for all inspections (this is often a good idea anyway, but at least if the seller has some inspections available you can know whether you’re seriously interested in the property before spending hundreds of dollars on those reports)
• Condominiums and Townhomes will have HOA (Home Owner Association) transfer fees that you’ll have to pay when buying (they also charge the seller hundreds to provide you with a complete packet of documents on the minutes, budget, articles of incorporation, bylaws, newsletters etc.). Often this is about $300.
• Some neighborhoods may have extra bonds and assessments that residents have voted in, and these raise your property tax bill.
• Loan fees can range from a few hundred dollars to several thousand, depending on the mortgage program you choose. Points paid at close of escrow may be a worthwhile strategy for you – discuss it with your lender and your tax professional!
• Are you buying a home “As Is”? If so, expect repairs to be needed even if the home “looks great”. It is not untypical for a house to require about 2% of the home value in upgrades and fixes, so if buying “as is”, factor that in, especially if there are no pre-sale inspections!

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Recently I was showing a buyer of mine a San Jose house which was vacant.  Often a home is occupied and the garage, in particular, is full of stuff so it’s hard to see the walls very well.  In this case, though, we could easily view where the walls in the garage meet the floor.  And this is what we saw:

Only a qualified, licensed Pest Control Operator can diagnose termites and pests, but this looks a lot like subterranean termite tubes to me.  When you see “mud tubes” such as this, it is time to call a good termite and pest control company for diagnosis and treatment.

Why do termite & pest companies insist that the garage be largely free of personal possessions when they inspect? It is so that they don’t miss things exactly like this. 

When buying or selling a home, understand that the inspectors arent being difficult if they won’t warrantee a garage as free of pests when they cannot view the walls or floor.  Bookshelves and personal storage can obstruct the view of things like this.  If you’re selling, be ready for the inspectors – have all your items away from the walls or even better, entirely out of the garage. If they have to call a packed garage as an “unknown further inspection”, it’s likely to cause you problems later, when there’s a time pressure.  Best to know upfront, for everyone’s sake, what the score is.

Sometimes when I meet prospective clients who are thinking of selling their home, I hear immediately, “we only want to sell As Is”.  In the next breath, they tell me, “and we want top dollar for our house”.  Those two are often mutually exclusive desires – that is, getting one usually means you won’t get the other.  But not always, and I’ll show you how to increase the odds of doing both.

To get top dollar, a Silicon Valley home for sale must appear to be the best value for the money and attract the most qualified buyers who step forward with a strong offer.  There are a number of things which must be done for that to happen, but one of the most important has to do with the condition and appearance of the property. Confident buyers write stronger offers than buyers who are concerned about the house or condo and potentially unknown risks.  Home buying is both a business decision as well as an emotional decision.  To get top dollar, your home has to make sense and appeal to buyers on both levels, and we’ll discuss both in this post.

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