Tips for Home Sellers
“Why didn’t my San Jose home sell?” is starting to be heard across this sprawling Silicon Valley city as market conditions soften and the number of sales has been dropping.
If you’ve had your San Jose home listed for sale with a real estate professional but after a long while on the market it hasn’t sold, you are probably tired, discouraged, and maybe even angry. What went wrong? Isn’t this still a hot seller’s market?
First – San Jose real estate market conditions
Neither the sellers nor their Realtors control the market, but it is imperative that we understand the market if your home is to be properly positioned for a sale. Your own area may not be reflective of the city of San Jose as a whole, but this should give you some ideas on how things are faring, and you can check the link below for your area, whether it’s Berryessa, west SJ / Campbell area, Almaden, downtown, etc.
The facts, taken from the RE Report for San Jose real estate trends in Sept 2018:
- Yes, it is still a seller’s market, however, it has been cooling since the peak in spring.
- Prices are down. If the “comps” you’re looking at were sales from May or June, those prices are too high.
- Sales are down. Sellers must try harder to create the home that buyers want to buy and Realtors want to sell. In September 2017, there were 483 single family homes sold in San Jose. In September 2018, that number fell to 408, which is a 15.5% decline year over year. The condo and townhouse market was worse, with 220 of them sold in San Jose in Sept 2017, and 163 in September 2018, which is a 20.9% drop. Your job as a seller is tougher because buyers are not so keen to buy now as a year ago.
- Days on Market (DOM) are up, meaning that it’s taking longer to sell homes. For houses, the DOM has moved from 17 to 26 (an increase of 52%). For townhouses and condos, it’s jumped from 18 days to 22 days for Sept 2017 to Sept 2018, up 22.9%.
- Days of Inventory is perhaps the most dramatic, changing for single family homes from 9 in Sept 2017 to 53 in Sept 2018, a whopping surge of 487.6% year over year.
Those are some of the scary truths. At the same time, homes that sell quickly (within 2 or 3 weeks tops) are selling for more than list price most of the time. When properties go pending within 10 days, they often sell with multiple offers and few or no contingencies. For sellers, that’s usually the sweet spot and why agents often focus on selling in the shortest amount of time with the highest price. It’s not just a tag line, it’s the truth.
Second – when residential real estate doesn’t sell, what are the usual reasons?
Everyone likes “easy answers”, and the most common easy answer to the question of why the house is now an expired listing or one that doesn’t sell quickly is price. Most homes that don’t sell are overpriced. This is true but an oversimplification. It’s not the only answer, and it’s not the answer every single time. It is the one we see most often, though.
If for some reason you find yourself in a very big hurry to get your Silicon Valley home on the market, you may not know where to begin or how to get it done. Today I’ll give you a quick list of the best things to do, and in order, too!
First, hire a great, full time real estate professional. This Realtor or other sales person will be your partner from the beginning and can give you insight and advice on the best place to spend your time and money for the best return on investment – and which items are the most important in your house or condo’s particular case, given the time restrictions. Your Realtor can also help you with time lines, managing pre-sale inspections (worst case, they can happen after your home is on the MLS), etc. Sometimes home owners begin on their own and make less than ideal choices when choosing paint colors and so on. Since part of the service provided when you sign a listing agreement is good advice, do hire first!
Second, think clean, uncluttered, and “good working order”. The rest of the tips all fall under the broad umbrella of staging – mostly de-cluttering, cleaning, and making sure that things work as intended. Perhaps you won’t be able to make everything immaculate and perfect, but in many cases, with even a few days you can hit the biggest areas fast.
Make a list of everything that needs some kind of minor repair or adjustment. Getting those items fixed will send a message to home buyers that your house or condo is turnkey and not a “fixer”. It may not be conscious, but if home buyers find doors that squeak loudly, doorbells or lights that don’t work, they begin to wonder if there are any big ticket items that are in need of repair or replacement, too. Hire a handyman or contractor as needed so that your home gives the right first impression.
Moving at lightening speed, with the listing signed today and the home on the MLS tomorrow? This isn’t fun, but I’ve done it with sellers at times. In those cases, you may have one frantic 24 hour period. Think of it like you do when entertaining relatives who may go anywhere in your home…
What would you do if you had one hour’s notice before company would be arriving at your doorstep? Here are some quick fixes for the hurry up sale:
- Be armed with large boxes or laundry baskets so you can begin to collect things where are where they do not belong and get them at least generally to where they do.
- Get the floors, counter tops and surfaces almost completely clear. If it’s newspapers, throw them out (show no mercy!). Have a box or basket for each bedroom or room of the house and put the items into the correct basket as you go through the house. For example, you could have one box for the garage, another for the master bedroom, another for the hall bath, etc. Bring all boxes into each room that you are “clearing” and take just one room or area on at a time. You may be moving 6 or 8 boxes or baskets from one room to the next, but it’s a faster way to sort and move things.
- If there’s no time to actually put all of these items away, do what most of us did in college: put the basket or box in the closet. And then close the door. No, it’s not ideal. It’s a quick fix and it will do the job 90-95% of the way. If you’re in a rush, it’s got to be good enough. Ditto that with the garage. If all else fails, put things into the garage. Some buyers may chuckle, but yours will most certainly not be the only house where they see this happen. If you have a truly excessive amount of stuff, get a pod or use a service such as Door to Door, where they bring a container to your driveway, you load it, they then take it away and you get it back when you’re ready to move. Continue reading
The Heritage Grove neighborhood in Los Gatos had an interesting beginning. An old apricot orchard used to line Blossom Hill Road between Union and Leigh Avenues until the 1990s. The former owners, Ralph and Sophie Heintz, lived there in their farmhouse until their deaths, at which time the property was willed to the University of California at Berkeley for eye research.
Sophie and Ralph were interesting people. He ran a small train on their property and was an inventor. She was a ham radio operator.
In 1998, the Heintz land (and house etc.) was sold to Summerhill Homes and a portion developed as housing by Summerhill. A few of the homes higher up in the neighborhood were built by different builders. That Los Gatos neighborhood is now called Heritage Grove. A strip of trees was planted along Blossom Hill Road, reminiscent of the history of the area. A wonderfully large section of land was made a permanent open space, now known as the Heintz Open Space Preserve. This open space connects directly with Belgatos Park, which also connects with the Santa Rosa Open Space Preserve. So the network of trails is quite extensive. (Link to Town of Los Gatos page with pdf files of these three trail maps. Link to Google Maps map of Blossom Hill Trails, drawn by Jim Handy.)
In 2015, I did a video drive through of the Heritage Grove neighborhood. Please take a look:
The Heintz’s big, old farmhouse has been renovated and is being lived in. Ralph Heintz’s old workshop, the Ramohs Laboratory, is preserved with signs explaining the history of the place nearby.
Summerhill Homes did a nice job of developing the land to keep some of the historic character. Please enjoy the slideshow below to get a feel for the area…. This scenic spot is well worth a visit: enjoy!
Where is the Heritage Grove neighborhood?
Heritage Grove is a neighborhood in east Los Gatos off Blossom Hill Road near Union Avenue
There are only five streets that make up Heritage Grove: Regent Drive, Regent Court, Ayala Court, Ramohs Way, and Heintz Court. Regent Drive is a long loop road while the rest of the streets are quite short, so the vast majority of Heritage Grove homes are on Regent Drive.
How big are Heritage Grove homes and lots?
The size of the 44 houses and lots within Heritage Grove varies a bit, as you might expect in any subdivision, but additionally there’s the historic Heintz farmhouse.
The farmhouse is appx 4100 square feet and sits on 3/4 of an acre (31,000 sf lot). There are 2 other homes over 4,000 SF also. Most are between 3,000 and 4,000 SF, but 4 houses are 2695 square feet, and two others are appx 2950 SF.
Parcels of land may be as small as 10,000 SF (appx 1/4 acre) to as large as 25,000 SF (a little more than a half acre).
Photo slideshow of the Heritage Grove neighborhood:
What does it cost to buy a home in the Heritage Grove neighborhood?
There are a lot of variables here!
Potential ingredients to make a home more affordable would be smaller home, smaller lot, proximity to Blossom Hill Road, a backyard or home with another higher up (and “looking in” – a lack of privacy).
Raising the value of the home would be things like a view, having open space or a large lot adjacent (less crowded feeling), being further into the development, having a larger home, larger lot, three car garage.
Historically, prices have gone from over $1,000,000 to under $2,500,000. This is a low turnover neighborhood, and nothing has sold in there too recently, but it’s safe to say that a huge home on a large lot with a view would likely go into the low 3 millions.
Other items of note:
Regent Drive rises as it gets away from Blossom Hill Road; many of the homes nearest to the Heintz Open Space Preserve enjoy nice views of Santa Clara County and downtown San Jose in the distance.
Heritage Grove is a great commute location as it’s close to Union Avenue, which provides fast access to highway 85.
It’s also close to shopping – the Downing Oaks Center, which includes a Safeway, a local (non chain) coffee house, a restaurant, and other services, is less than a mile away.
Heritage Grove is served by the Union School District and the Campbell Union High School District. Schools are Alta Vista or Noddin Elementary, Union Middle School, and Leigh High School.
If there are any Heritage Grove homes available, they will be listed here. Below that list, please find properties for sale in Los Gatos with the 95032 zip code.
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$1,698,000 : 15921 Linda AVE, LOS GATOS3 beds, 2 baths
$1,599,000 : 220 Caldwell AVE, LOS GATOS2 beds, 1 bath
$2,200,000 : 185 La Canada CT, LOS GATOS4 beds, 3 baths
$1,649,000 : 164 Belcrest DR, LOS GATOS6 beds, 3 baths
$2,438,000 : 251 Littlefield LN, LOS GATOS3 beds, 2 baths
$4,150,000 : 440 Santa Rosa DR, LOS GATOS5 beds, 5 baths
$2,288,000 : 16570 Shady View LN, LOS GATOS4 beds, 2 baths
$1,999,500 : 16790 Chirco DR, LOS GATOS4 beds, 3 baths
$1,488,888 : 15401 Blossom Hill RD, LOS GATOS4 beds, 3 baths
$1,888,000 : 15080 Los Gatos BLVD, LOS GATOS3 beds, 3 baths
See all Los Gatos homes for sale 95032.
(all data current as of 10/20/2018)
Listing information deemed reliable but not guaranteed. Read full disclaimer.
Belwood, Belgatos & Surmont neighborhood (adjacent on the east – article on the Live in Los Gatos blog)
Del Oro neighborhood of Cambrian on the Los Gatos border (almost directly across the street)
Strathmore neighborhood (close by)
Los Gatos Real Estate Market Trends & Statistics (updated monthly)
Things in the greater Silicon Valley real estate market are shifting right now, with downward pressure on pricing in some segments of the market. In other places or price tiers, prices are level, or possibly rising a little. It’s still pretty red hot in Santa Cruz County, but cooling generally in Santa Clara and San Mateo Counties. The Los Gatos condo market is definitely feeling the chill. What do you need to know or do if you’re selling your home in a declining market?
There are a two principles which are important to understand.
The first truth to grasp is that all real estate statistics are yesterday’s news. Homes that are closing escrow today most likely were negotiated 4 weeks ago. That was last month’s market. Looking at comparable properties that sold 2 months ago is really a reference to the market conditions of 3 months ago. What is most relevant can be the hardest data to obtain, and that is what has gone under contract yesterday or at least within the last week or so. When you cannot get the pending info, it’s helpful to piece together the sold info chronologically.
Santa Clara County in recent months – median sale price:
July 2018 $1,350,000
June 2018 $1,402,000
May 2018 $1,414,000
April 2018 $1,420,000
March 2018 $1,450,000 – PEAK
February 2018 $1,380,000
January 2018 $1,1,163,000
We don’t know what August’s numbers will be like yet, but there’s a good chance that they will be lower than July’s.
Second, it’s important to try to determine where prices are headed and to get ahead of the curve, if possible. This is easier said than done, of course, because it’s never a straight line up or down, but something with a lot of variation. (It is also true for buyers in an appreciating market – they have to jump ahead of the curve to bid high enough to get the home, not offer where the current comps are selling.)
Looking at this graphic image, it would seem as if the “big picture” is a consistent upward movement. However, there are a lot of downturns within the general upward trend. Our current “down” movement may well rise again in the new year, as many local real estate economists predict. That’s not certain, though, and many real estate market corrections begin slowly, and instead of reaching the old peaks, start reaching smaller ones, rising and falling to a different tempo. It can seem slow enough, but you cannot tell while it’s happening if it’s suddenly going to drop like a nightmarish roller coaster. During the Great Recession, we had a lot of ups and downs, but one outlandishly steep slide. I created this graph below on the MLS, and later added the red lines to make the January in each year clear, as most years, prices begin rising in February (sales in January). Please note that despite the recession, prices usually rose in early spring
As you can see, except for the steep declines in 2008, there were plenty of peaks and valleys during the 2006 to 2012 years. Even in 2008 there’s an upward blip and I think it’s fair to say that many of us thought that the market was going to start to recover at that point – or at least hoped so. After that little tick up, though, it continued its downward movement. We very much felt the dip in pricing in late 2010 through early 2011. Looking back, it may not seem so bad now, but at the time, we had thought the housing correction was over, and that decline was a nasty deja vu. And please notice the low points in each year – usually they are in January (think sales in December). Jan 2012 was lower than January 2011 or 2010, and was close to 2009.
I do not believe that anyone expects a correction of that magnitude in our lifetime again, but it would be foolish to say that anything cannot happen.
The pattern, though, can be unpredictable. Some slides are long, slow, and fairly consistent, as in the 1989 to 1992 correction. Other times, things can drop like a rock, as with the dot-com bust in 2001.
Either way, if you are selling your home in a declining market, price accordingly to mitigate damage and get ahead of the curve.
You cannot tell ahead of time if the falling rate of values will accelerate, slow down, or go flat, but you can see what has happened in the last 6 months or so and try to determine the rate of change.
So what is a seller to do – sell before it gets worse, or hang on until it gets better?
What do you believe it is that we are experiencing now? Is it a seasonal blip, or the beginning of a trend?
If you believe that the current market conditions are seasonal (that is my thinking since Silicon Valley still has so much hiring and demand), then if your home is in one of the cooling areas, selling now is a mistake, because many home buyers are concerned about over-paying. If you believe that spring 2019 will bring better prices, then I would suggest holding off on selling and focus on getting your home into TOP SHAPE so that you will fetch the highest possible price when you do sell, whether early in 2019 or at some other time.
If you believe that the market is at the initial stages of a market decline (and nationwide, the real estate market seems to be cooling), then you have to decide if you want to sell now or wait until the market hits another peak.
If you must sell now, and you have softening prices in your area and pricing tier, then you must be realistic that you are going to be selling your home in a declining market. It may not be declining next year, but it has been declining since March for most of Santa Clara County, and buyers have been paying attention to that fact.
- In a declining market, there’s more supply of housing than interested buyers
- If there are 2 or 3 or more homes for every capable home buyer, your property needs to be the best value to make the sale
- Most of the time, being the best value translates to offering the lowest price from among your property’s competition
- Sometimes, being the best value can mean offering the best terms, such as owner carried financing, offering to re-roof, do pest repairs, etc.
- To attract agent attention, consider offering an attractive buyer’s commission rate (better than what everyone else is offering, data that is easy for your Realtor to get from the MLS)
Many areas are still seeing overbids, but they aren’t as high as they used to be (the average sale price to list price ratio was 105.6% for Santa Clara County in July 2018. Back at the peak, and now, sellers who want their homes to get the most attention under-price it a little to get multiple offers and overbids.
Even in a seller’s market, I do encourage my sellers to price their home to be the best value – a strategy that normally results in the best results. Additionally, do the repairs that might scare buyers off. Keep in mind that they are afraid that as soon as they buy, their new home will be worth less, so they do not want to have to put money into the home to fix things such as electrical work, roof leaks, etc. Make sure you hire a great Realtor who will help to get your home into top showing shape, and will market it widely on the internet with professional photos, and market it well in person with quality fliers. Newspaper ads and post cards seldom bring buyers to your door, but a well placed Facebook ad may. Make sure you see the MLS printout and have any errors corrected. A second set of eyes on all of the marketing is a good idea – in a cooling market more than ever.
Home seller temptation # 1: overconfidence on the market
Because folks read about the dozens of offers on some homes, by extension, it’s easy to believe that every home sells, for top dollar, with no effort or planning on the part of the seller. This is a huge mistake. Perhaps we should even call it a myth since it may be commonly believed.
In today’s wildly hot market, there are still some homes that DO NOT SELL.
What are the odds that your home won’t sell?
I just pulled some numbers from the MLS today, July 23, 2018. You may find them surprising!
- In Santa Clara County, there are currently 1274 single family homes on the market
- 490 of them have been on the market at least 30 days – 38% are not moving quickly & likely need a price reduction, if it hasn’t already been done
- 211 of the 1274 have been for sale for at least 60 days – 17% have had 2 months worth of open houses, keeping the home spotless, etc.
- 107 of the 1274 have a “days on market” of 90 days or more – 8% have serious market rejection
- These are not all luxury homes!
- 9 are listed at under $1 million
- 13 are offered between $1 million and $1,499,999 (“normal” houses in our area)
- 9 are on the market between $1.5 mil and $1,999,999
- 14 are listed at $2 million to $2,499,999 (these are still not luxury homes in most cases)
- 11 are priced between $2.5 mil and $2,999,999
- That’s 56 homes of 107 that are under $3 million. The balance are “high end homes”, which usually are more challenging to sell
The best homes, those which are well priced, well marketed, and are easily shown, sell within 2-3 weeks. After that, home buyers view them as stale listings and assume something terrible is wrong with them. After three weeks, unless the home gets a deep price reduction, it’s unlikely to get multiple offers.
This first temptation is the greatest one, and it often leads to mistakes in areas #2 and #3, listed below. Continue reading
Sellers should leave during showings of their homes – that is the common wisdom in the real estate industry. Most Silicon Valley Realtors will advise their seller clients to go out for a walk, do errands, or otherwise be fully out of sight when buyers and their agents visit the home. Home owners may object that “it is an inconvenience. And what if the buyers or their Realtors have questions? ”
Recently, some friends told me of an extreme situation in which the home owner was in the driveway, grilling prospective open house visitors to see if they were serious buyers or just having a fun look – and told them that unless they were willing to buy that day, they should turn around and leave. They did. (I felt sorry for both them and for their Realtor, who watched them leave and wondered what happened.)
Once, when my family and I were house-hunting, we had the home owner follow us all through the house, staying all of 3 feet away at any given time. When we walked into the back yard, he followed us, grabbed a lawn chair and sat in it – staring at us.
My children referred to that episode as the one with the creepy man who followed us. Needless to say, we did not buy that house with the overbearing seller and the creepy vibe.
Assuming that a home owner would not do anything so egregious, could they remain at home? We return to the topic to answer this question:
Why should sellers leave during buyer tours?
The main reason why sellers should leave during showings has to do with how the prospective home buyer feels about the place. For cautious home buyers especially, the seller’s presence is off-putting.
Home buyers are more comfortable when several conditions are met:
- the property needs to be neither too hot nor too cold (or they will leave fast!)
- it needs to be clean and welcoming and to not smell bad (that doesn’t mean using lots of air fresheners)
- it should be uncluttered and depersonalized
- home buyers need to have “space” to hang out and envision living there, and that requires time.
Willow Glen is one of the most charming areas of San Jose, consisting of many older homes which feature lovely, classic architecture. Most Silicon Valley home buyers treasure the Willow Glen charm and ambiance, but many are seeking newer homes. A fabulous option is “The Willows“.
KB Homes built “The Willows” in 1999 to 2000. It is tucked away at the southernmost tip of Willow Glen, off of Foxworthy Avenue & close to Almaden Expressway, but only about 2.5 to 3 miles from all the action on Lincoln Avenue.
The tree-lined streets are built in something of a loop shape with Rubino Circle being the main access or loop road. Situated on the inner part of the loop are homes with smaller lots that are a little more affordable. The outer part of the circle is built with slightly larger homes on larger lots (but none of the lots are “big”). Sidewalks with soft curbs at the corners accompany the streets and make for a pedestrian-friendly, bike, wheelchair or stroller friendly area. Visit in the early evenings and you will see children and adults walking, strolling, taking dogs for a walk etc. – always a good sign! Because the neighborhood is a bit like an oversized cul-de-sac (no through traffic), it is very quiet in terms of traffic. The area has large street lights, too, making for a safe feeling community.
Close to the Los Gatos border sits one of the more affordable Cambrian neighborhoods in San Jose and the west valley generally. It enjoys lovely views of the hills, great public schools with high API scores, a neighborhood private school to boot, and convenient access to freeways and stores. There’s no sign, marker or gateway to the area, so many of its residents are probably unaware that the official name to it is Cambrian Gardens.
This neighborhood provides an incredible “bang for the buck” for home buyers wanting excellent schools and not wanting to pay luxury home pricing. In many ways, it’s a “sleeper” – meaning that many people don’t know it’s there, but it’s a good deal!
Convenient to Good Samaritan Hospital, Carlton Elementary School and freeway access to highways 17 and 85, the beautiful “King Street” neighborhood in San Jose’s Cambrian Park district seems to be close to everything. But a drive through the tree-lined streets with tidy homes seems like a relaxing step into the welcoming neighborhoods of yesteryear rather than the hustle and bustle of today’s Silicon Valley.
As with the nearby Alta Vista neighborhood, homes here show a pride of ownership not found everywhere. Holidays include beautiful displays of lights that invite neighbors out to tour after dark. Many home owners wrap the trunk of the trees between the sidewalk and street with blankets of white lights, making for a stunning look down the road.
The “King Streets” enjoy an uncommon appeal that makes homes here perennially desirable to home buyers. The popularity of the area is due partly to the convenience factor (easy to get to a great elementary school with high API scores, easy to get to the freeways, Los Gatos and Good Sam) and the beauty or neighborhood charm factor. It is a winning combination for this west valley community! Many who wish to live in Los Gatos choose this part of San Jose because it’s on the border, so it is not uncommon for the King Streets to be a first home and the move up one is in Los Gatos.