Homes which are dark inside, or which feel dark to potential buyers, are much more difficult to sell, and virtually always sell for less money than those which are perceived as “light, bright and airy”.  While a property’s owner might love the cozy feeling of dark paneling, deep overhangs and low lighting, it’s not what most buyers want today.  To maximize the amount a house, condo or townhouse in Silicon Valley will sell for, it’s imperative to make it as attractive to buyers as possible.  In many cases, that means it needs to be lightened and brightened to sell for top dollar.

How can a home owner make a house or home be – or seem – more bright?  One of the biggest “offenders” in this area involves windows! Here are a few window-related problems that can make a home feel significantly darker than necessary, together with some potential solutions:

• an interior room with no windows (seen with additions sometimes) or dark hallway

**consider adding a sun tunnel or skylight (as well as ceiling & other lights)

• tinted windows

**remove film, if applicable, or replace with non-tinted windows

• curtains/blinds which obstruct part of the window

**pull back so that 100%, or close to it, of window is visible

• shrubs, and trees covering some of the window

**trim back so the window’s glass panes are 100% visible, if at all possible, to let maximum light in

• deep roof overhang which prevents sunlight from directly entering the home for much of the day

**look into adding skylights over the porch – keep the overhang but allow more light in!

Once you’ve done as much as possible to allow the maximum amount of natural light into the home through the windows, it’s time to tackle other areas where light is either absent, minimal, or otherwise obstructed. (more…)

Early in my career, I had the pleasure of working with a wonderful young woman (let’s call her Ann) who was preparing to buy her first house in San Jose.  Ann was all of about 23 or 24 years old, but she had been saving since she was 16 or 17 years old. So much discipline!  This Silicon Valley native had a clear idea of what she wanted (a house in a good part of Santa Clara County), what she expected (a bigger place that probably would need some work) and her long term goals (get a house and rent bedrooms out to friends and relatives later).

Together, we got her into a 4 bedroom Blossom Valley house with lots of potential.  Ann rented the other 3 rooms out to friends and relatives.  She worked to save the money to buy the property and has labored to make it better over the years.  This was not an impulse buy at all – instead, it was part of a big plan she had since she was a teenager.  I did and do respect her so much: she had a very clear idea both of what she wanted, and what she needed to do to attain it.

How many of us can say the same or have so much discipline and planning?

I have a ton of respect for people who carefully save and plan.  At the other extreme, I worry tremendously about those who make spur of the moment, highly impulsive and seemingly unrealistic decisions.  When or if they ask me for advice, they don’t always like what I have to say, because as a friend or as their Realtor, I need to try to help them to make better decisions. (more…)

Sometimes the differences are not what’s outside, but what’s inside.  When Silicon Valley home buyers are looking at real estate around the south bay, they tend to care a lot about the rooms which are most expensive to remodel: the kitchen and the bathrooms.

But sometimes they don’t look closely enough, or ask questions, when they ought to.

If you only look at the cabinetry from the outside, for instance, you won’t know:

• whether the cabinets have been refaced or replaced – but if you open up a door, you can tell!
• whether the vent seems to blow air back into the kitchen or if it’s more likely to vent outside
• whether the cabinet’s interiors are shelves, pullouts or include other special features such as a lazy Susan, deep pantry or spice shelves, recycling tubs, or other goodies!
• on a simple level, whether or not the drawers and cabinet doors operate smoothly or not (more…)

Wheneever I have new home buyers, there are always components in houses for sale (or condos or townhomes) which need explaining. There are so many things which Silicon Valley home owners take for granted as known and understood, but sometimes they aren’t so obvious to new home buyers. So today I’ll share a few photos and simply explain what each is.

Ever see one of these (photo below) protruding from a garage on your way up to a front door? It’s the dryer vent!

Pricing is the most important element of “marketing a home for sale” that sellers and their agents do and over-pricing is the #1 reason why some homes don’t sell.  Here’s a quick list of the most common pricing errors which Silicon Valley home sellers should avoid because they often lead to overpricing:

1. Selecting the list price of the home based on what you want or need rather than on what the market will bear (the “probable buyer’s value” of your home).
2. Using dissimilar “comps”.   The best comparable properties will be within a mile  of the subject property, within 10% of the home’s size and 10% of your lot’s size,  in the same school district and ideally in similar condition and very recently sold.
3. Hiring an agent who tells you an inflated price and then using that number. Look at the numbers yourself.  A better practice is to first select the best Realtor and then arrive at a pricing strategy together. Many agents are pressured by homeowners to tell the owner what he or she wants to hear.  This is truly counter-productive! 
4. Not factoring in negative issues which could impact your home’s value, such as proximity to busy roads, high voltage power lines, the look of nearby homes and yards, non-permitted work or additions, etc. Ignoring it – or believing that buyers will – means you will be perpetually too high in your assessment of your home’s value.
5. Failing to include the current competition in your assessment of your real estate’s value.  Are there a lot of homes like yours on the market? Are they just not selling? If so, the buyers are telling you that the whole lot is overpriced!  Are there lots of short sales and bank owned homes selling nearby? Unfortunately, those are going to pull your home’s value down, so those need to be included in your assessment. It is very important to establish the probable sales price of your home by looking at the competition as well as the pending sales and recently sold homes.

Formal appraisals are not the same thing as a competitive market analysis (CMA).  An appraisal only looks at the already sold homes (and perhaps may factor in the current market climate, but not to the same degree at CMA would do).  A good CMA will provide data on the active listings, pending sales and nearby solds which are similar to the subject property.  It ideally will be very honest about any negative (as well as positive) elements that alter the likely sales price of your home.  A home’s appraised value may NOT be its market value! 

If you’d like to chat about selling your home in San Jose, Los Gatos, Saratoga, or nearby, please call or email me.  When we meet, I will give you a complimentary copy of my book, “Get The Best Deal When Selling Your Home in Silicon Valley“.

In recent posts, I’ve raised the issue of why “terms” are so important when writing a competitive purchase agreement to buy Silicon Valley real estate.

Whether you are buying your first condo, a retirement home, a luxury property or a move-up house, the basic challenges of competing in multiple offers when you want to buy a home but not overpay and not give away your most critical rights tend to be very similar. Finding that balance is tricky but hopefully this series of posts will shed some light onto how listing agents and home sellers tend to respond to offers and what they’re looking for so that you can position yourself in the best possible way with that balance in mind.

Today we’ll continue on with tips specifically related to the finance portion of your contract: loan type, loan amount, cash downpayment and loan terms.

Why should the seller care what type of loan you get? In the end, sellers usually get “all cash” once the transaction closes, right?  If there’s only one offer, and it doesn’t “cost” the sellers anything (they aren’t asked to pay points or other fees for you), that certainly seems to be the way financing is viewed: it will be all cash, eventually.

But in multiple offers, the type of loan you get and the terms that go with it can make a very big difference to your positioning versus the other potential buyers. It comes down to the issue of risk. Home sellers and agents know that some buyers have such solid financing that there is little or no risk there that the transaction won’t close.  And others have more risky loans.

At one extreme is the all cash home buyer.  With an all cash offer, there is literally no financing risk. (At one time, buyers sometimes foolishly made all cash offers when their money was actually tied up in the stock market. With downturns in 2000 and more recently, though, the industry and buyers both have wised up: the cash must be liquid, as cash in a bank account.)    At the other extreme is the no-down or low down payment offer.  The less “down”, the more risk – every time.  Likewise the less down, the worse your chances are of winning out in a multiple offer competition for a home.

Additionally, some loans are inherently more difficult to get through escrow.  FHA loans are wonderfully popular right now, but they usually need 45 days to close, not 30.  Further, they require a higher level of property condition and the appraisals are therefore much more involved.

There are a lot of special loan programs available to first time homebuyers, to veterans, to teachers and to municipal employees. Many of these are excellent programs for the homebuyer, but for the seller they often translate into more risk because there are more loans, the involvement of grants, extra costs or simply more complications – more that could possibly go wrong.  Most often, buyers with these special programs are anxious to buy but if put into a multiple offer situation will not have the winning bid unless everyone they’re competing against also is in the same financing situation (all offers happen to be FHA, for instance).  If you have a special loan – one that is not 20% down at least – it is very hard to compete in multiple offers, maybe impossible.

So, one of the most important aspects of your loan is the type, including the loan to value ratio (percent of loan to the purchase price).  The greater the amount and percent of cash down, the less  risk to the seller, generally, and the more favorably your purchase contract will be seen by sellers and by their agents.  A standard, conforming loan with 20% down or more will have a far better chance of success against multiples than a “special” loan with little or no down.

Another issue is that of loan terms: what interest rate is sought? which bank is going to fund the loan?  Are there points, and if so, who’s paying for them?
(more…)

Visiting Silicon Valley and San Jose area open homes is a great way to get to know neighborhoods, architectural styles and the market overall. I encourage people thinking of buying or selling to visit the opens nearby to get a pulse on the market and what’s “out there”.  Normally it’s low pressure*.

*In terms of “pressure” at open houses, most Realtors and other realty professionals will let you go through the home at your own pace. Some will require a sign-in (often claiming that the seller requests this, but most often it is so that the agent can follow up with you later).  Once in awhile, though, you may bump into a “quantum” tour situation. With these, the agents are somewhat oppressive and require not only a log in by you but also insist that you only go through the home personally accompanied by one of their sales associates. The reason, of course, is “lead generation & conversion”. They want to increase the chances of getting clients out of the open home. The spin is personal attention.

Of course, the other extreme you may see is not high pressure, but nearly asleep. Some agents (maybe one in 20?) will not get up from the couch or table to even shake your hand and welcome you to the home. Hopefully you don’t run into this much!

A few open house tips, in terms of what to be aware of:

• feel the floor as you walk through the condo or house: is it level?
• smell the various rooms – are there candles or other scents intended to mask odors?
• note the light and time of day, as well as the direction the home and windows face and ask your self if the home gets adequate light for your taste
• is the layout good?
• is there enough storage?
• if there are problems with the home, can they be fixed?
• what needs updating or remodeling, or will need it soon?

The best homes will have presale inspections and disclosures completed which you can view prior to writing an offer.  It can be very helpful to familiarize yourself with the various reports, inspections, and disclosures so that you understand the range of normal. Older homes will not be defect free, and sellers will not make them perfect either – so get a feel for what to expect by perusing some of these if the binders are available during your open house. (Do understand that the agent is likely going to read it as a “buying signal” so explain that you just want to understand how the paperwork looks.)

For more tips on what to include when viewing Santa Clara County homes for sale, please see:
Viewing An Open Houseop  on my main website.