Silicon Valley Real Estate Info
Many of us cheered to hear that some of the large banks (who have not been wonderful to deal with regarding loan modifications, short sales and foreclosures or bank owned property sales) were getting sued by federal regulators for various types of malfeasance.
Most recently, the Federal Housing Finance Agency, which is in charge of Fannie Mae and Freddie Mac, filed a lawsuit against 17 major banks, including Bank of America, Citibank, Morgan Stanley, and several others (see a complete list here).
So how does this impact you, the Silicon Valley real estate home buyer or seller?
Imagine you’re on the board of any of these institutions. What do you do to protect your shareholders when something like this happens? Perhaps first of all, you make sure that whatever you’re accused of doing cannot happen in the future. You hand down new policies and get them implemented immediately. No exceptions.
Some of my buyers got caught in this situation, without warning, when their lender informed us that there will be a week-long delay in closing due to new procedures which are mandatory for every file, bar none. Our loan contingency was removed awhile ago (with the lender’s assurance that all was fine). We will still close escrow, but late. This never makes anyone happy.
Right now, if you are trying to buy a house and will be relying on lender financing, I suggest you find out if your bank or lender is involved in a big lawsuit and if so, how this may be impacting real estate purchase contract deadlines. Most lenders do need 17 days to get you fully approved if you go into the escrow pre-approved (with a real pre-approval, not a pre-qualification only) and 30 days to close the sale. But if your lending institution is in a messy legal battle, it could take longer, and it could be a surprise. In escrow, no one likes surprises, especially if they cause any sort of default.
This situation will probably benefit the credit unions and banks which did not misstep with the subprime loans. Got a great bank that performs fast and is free of legal battles? Please share it here!
Realtors tend to love real estate because of the flexible hours, being one’s own boss, the unlimited income possibility (that’s the ideal, perhaps not the reality recently) and the fact that every day is unique. There’s not a lot of dull routine in real estate sales! It’s equally diverse among the personalities and work styles in real estate, too.
It may surprise you to learn that many successful agents spend a great deal of time “practicing scripts and dialogues“. These are the folks who have pat answers to every question (or “objection”). The answers may not always be authentic, but they are designed to “close” you – that is, to get you to sign the listing agreement or the purchase contract.
That’s one extreme.
At the other, you find people who’ve been real estate sales people for years but cannot respond to the commonly-asked-questions like “why should I …” (fill in the blank).
- why should I allow a (for sale) sign in my yard?
- why should I permit you to use a lock box or keysafe at my property?
- why should I list or write an offer for X dollars – and not more or less?
- why should I (a buyer) get pre-approved?
- why should I (a seller) make it easy for a buyer to view my home?
- why can’t you, the listing agent, be present at every showing?
- why can’t I list my home 20-30% higher than the comps? (and many other Silicon Valley home seller questions or objections)
Good Realtors or real estate agents or licensees SHOULD be familiar with the most commonly asked questions and they ought to be prepared to respond to them. The very best agents know the most commonly asked questions. They may not have memorized pat answers that sound like sound bites on a news show, but they actually do know the content and can listen and then articulate a reasonable response. They know their stuff, so they can improv – but it’s an educated improv. To me, that’s the best.
And guess what? If a question is totally foreign, they don’t have some slimy quick response to put you off, instead they’ll say “I don’t know, but I’ll find out”. That’s not a bad answer. Don’t you prefer honesty over a sales technique? I sure do! It’s authentic. (Real estate is full of new experiences. The agents who’ve been around for decades will offer that they continue to learn something new on every transaction.)
[Worried about being given a dose of “real estate objection handling“? Take a little time and do a web browser search of this term or similar terms.]
Frequently I’m asked if I (or another real estate licensee or agent) can help a consumer to purchase a foreclosure. There are some nuances to this answer, but in short, it depends.
There are several stages in the foreclosure related sales in California. Often, homes somewhere in this quagmire are listed on our Silicon Valley area MLS or multiple listing service. If a property is listed in the MLS, then yes, we Realtors can help home buyers with a distressed sale purchase.
- Pre-foreclosure (where payments have been missed and a Notice of Default or NOD has been filed – often, but not always, these homes are on the market and included in the MLS. If they’re in the MLS, I can help. Often these are short sales (but short sales are not always in pre-foreclosure – they may not have missed any payments).
- Trustee’s sale, or actual foreclosure on the courthouse steps. No role for a real estate agent here. There are some big caveats and warnings! First, often what’s owed against the home is more than it’s worth and the only way to purchase a home here is to pay off all the debts (so it may not be much of a deal!). Second, if you buy here, you get NO inspection contingency and must pay cash for the house. End of story – no backing out. Worse, you cannot inspect it ahead of time!
- Bank owned or REO. These are usually listed on the MLS and if so, I can help you with it. Sometimes banks hold onto them between the trustee’s sale and prior to listing them with a broker. Often this is only for a month or two but sometimes it’s longer. If it’s not on the MLS, it’s very very hard, or maybe impossible, to buy it.
While it’s not hard to locate homes where owners have missed some payments, it should not be assumed that these houses are either for sale or that the owners have any intention of selling them. In my opinion, it would be harassment if consumers showed up on their doorsteps trying to purchase a house where a payment has been missed. Most, maybe all, of the residents there would be offended. They may be trying to get a loan modification (a friend of mine got one approved last week!) or have family & friends helping them to get back on track. If it is not listed in the MLS (which you can find at www.MLSListings.com – the public portal of our agent multiple listing service), the odds are overwhelmingly against it being available to you.
Often I get emails from people asking if I can help them with finding a rental property. For the most part, my practice revolves around listing and selling real estate in San Jose, Los Gatos, and Silicon Valley generally, so my best information is on what’s for sale, not what’s for rent. Once in awhile I work on rental housing, but not normally, as rental condos or houses through an agent (if they are listed on the MLS) will usually cost you more than homes you find to rent elsewhere.
The best resources I have found for locating rental properties in Santa Clara County are these (I cannot guarantee or warranty your results, but these are starting points for you):
- Craigslist (link is to the South Bay area)
- Bay Rentals (they do charge a small fee)
- ForRent.com (search by city name or zip code)
- Once you’ve located an area you like – drive around
- possible – the mls search – scroll down on left sidebar widget on this blog and pull down the menu under “all property types” and select Rentals OR run similar search by map on my popehandy.com site at this link ~ you must also find “property types” on left side and then locate rentals under that)
The last bullet point might seem silly, but some of the best apartments, townhomes etc. never get listed anywhere other than a sign in the yard. So if you love Los Gatos, Campbell, Santa Clara or anywhere else, drive it and watch for signs! (Or talk with friends or acquaintances in areas you like – have them keep an eye out for you.)
Perhaps you want to be in a hotel or inn for awhile before deciding where to rent or buy, or while on temporary assignment at a local business or university. You don’t need me to tell you where to stay in a hotel, but if you are moving here with a pet you might want assistance finding a place which will welcome your cat or dog. Here’s a great resource for finding pet-friendly hotels, motels and inns here: DogFriendly.com’s San Jose (and nearby) City Guide, which includes accomodations, parks, outdoor restaurants etc.
Right now, it seems to be the case that it’s harder to rent a home than to buy one – at least that is the word on the street. (And it seems that like with the purchase market, the closer you get to Palo Alto, the tougher it is.) Tougher still if you have pets or smoke. If you have pets or smoke and find a rental, the cost per month will be higher.
The Silicon Valley real estate market is a mixed bag and home buyers and sellers here may read the headlines and wonder why things seem so different in the news than in their own personal reality!
Here are a few quick facts and observations about the San Jose and Santa Clara County real estate market for houses, condos and townhouses:
- It is a seller’s market for both houses and condominiums in Santa Clara County (homes are selling well and very close to list price on average)
- The average and median sales price for houses & duet homes is down month over month and year over year (properties that are selling are those which are priced lower)
- For condos and townhomes, prices are up month over month (but down year over year). The condo market here has taken a huge beating in recent years.
- The market is not equally hot everywhere! It’s red hot in Palo Alto, Los Altos, Cupertino, and areas nearby (Santa Clara, Sunnyvale, Mountain View). It is also hot where there are low priced foreclosure houses which can be bought at bargain rates. The move-up market has been tough entry level houses in the best school areas are very sought after right now. (The market is decidedly cooler in Los Gatos and Almaden Valley.)
- Homes that are selling best are completely remodeled and have no “issues” (such as high voltage lines, poor floorplan, proximity to something undesirable etc.) and priced aggressively OR are distressed sales with great pricing
In the best areas, or those with the hottest markets, we are seeing some multiple offers with overbidding. At the same time, we are finding homes that look great but languish on the market due to some issue or another or pricing that’s not as competitive as it needs to be for today’s market (or both). Continue reading
Update: SALE PENDING!
You’re invited to see this stunning young urban living condominium in Campbell close to everything featuring two bedrooms plus loft, 2 bathrooms and approximately 1610 square feet. All of this can be found in an elegant resort-like setting! New listing, open this weekend from 2-4 (Aug 13-14) so please stop by!
Urban Living in Campbell
This sleek condo, the Sapphire Penthouse floorplan (see below), is located just steps from the light rail and Los Gatos Creek Trail, shopping at Whole Foods and many other shops across Bascom, the Pruneyard a block or so away and downtown Campbell just around the corner! A myriad of restaurants lie within a tenth of a mile. One of my sellers told me that she had only put 1500 miles on her car in the year living there. Imagine simply not needing your auto much at all!! (The building does include two spots in the underground garage for your vehicle, should you still want one while living there!)
Resort Living, Contemporary Setting
Built by Pinn Brothers with great attention to detail, the Onyx offers tremendous features both in the condo itself and in the many fabulous shared areas.
Interior features include:
- open floor plan with high ceilings and dark floors
- elegant kitchen with mostly Bosch appliances (fridge is Fisher & Paykel), tremendous counter space with slab quartz countertops, recessed lights and contemporary dark cabinetry
- an abundance of natural light, loads of windows and recessed lighting
- spacious bedrooms (the master is really large!) and bathrooms
- Master bath features two sinks, large soaking tub and separate stall shower
- comfortable balcony
Community features include: Continue reading
One of the worst marketing efforts, in my opinion, is a rider attached to a “for sale” sign stating “I’m gorgeous inside!” It’s as if to say “I know the exterior is really bad, but just wait ’til you get past the front door!”
A better approach than an apologetic rider sign is to tidy up the front of the home and yard so it gives a great first impression.
If you are a potential seller, drive through your area (zip code, subdivision etc.) and have a look at the outside of other properties for sale which are generally similar to your own for size, pricing and so on. How’s the competition doing with curb appeal? Pretend that you’re a Saratoga, Almaden or Cambrian home buyer. Take notes. What do you see? Be brutal in your assessment and then take your observations back to your own home and keep the same standards.
First, pay attention to these landscaping elements in the yard:
- The lawn, if there is one: is it green? Weedy? Healthy? Does it have bare or dead spots? Is it level or “bumpy”? Is it fairly uniform, or are there patches of various types of grasses in other areas, making the lawn uneven in color, texture, or density? Putting in fresh sod may give you a super “bang for your buck” or return on investment.Why does this matter? Because if your lawn looks neglected, buyers may wonder what else is neglected, too.
- Bushes and shrubs should not impede sidewalks, walkways or views of doors and windows. Buyers will feel crowded if they sense that plants are blocking their passage or that of light! The yard, like the home, needs to feel uncluttered. As you look at the other homes’ yards, do the bushes look appealing or unruly? Are they a help or a hindrance to the home’s curb appeal? Many buyers do not like ivy or juniper, by the way, unless they are exceedingly neat and in small quantities.