Entries Tagged 'Uncategorized' ↓
April 5th, 2017 — Uncategorized
When it comes to real estate news, it’s impossible to escape the media’s fascination with the theory that there is a large problem with available housing inventory. Whether your news source is talking about the lack of new residential home building, the lack of affordable housing, or the increase in rents as more people become renters, it all seems to blend together as real estate white noise.
So what is the actual truth about housing in our Riverside area? Are the media reports accurate? And what does that mean to buyers and sellers in our city? Let’s take a look at our local picture, because as usual, the media only has part of the story correct.
YES…there is a lack of new home building in our Riverside area to meet the demand by buyers, but that has been the case for many years. This is not new (why all the fuss now for an issue that has existed for quite a while is beyond us.) YES…rents have gone up the past few years, but they have done so at about the same rate as homes have appreciated, which is also pretty much the norm.
So what has the media missed? Simple…and here is your real estate snippet of information guaranteed to make you look good at your next social gathering when the conversation turns to real estate.
All real estate data regarding inventory is determined by price range…and the market and subsequent sales activity is different for each price level. Therefore, you cannot make blanket statements about “inventory”, or “sales activity”, or “affordability”, or much of anything else without first knowing what price range you are talking about.
As an example, in our Riverside area, there are lots of homes for sale in the $300,000-400,000 price range, but since this is the most active price range in our market, the homes sell quicker. Therefore, if you take a static snapshot on any day of the number of homes for sale, it will show a relatively low number…but that’s because most of them are sold! However, these sold properties are constantly replaced by other homes for sale, which means there are usually enough homes for a buyer to choose
from. Whether the perfect home is there when a buyer wants is another story…that is always the case. However, patience is normally rewarded, because new homes come up for sale every day.
As you climb the price range ladder, it should come as no surprise that the higher you go, the slower the market, and the more properties that may be for sale at any one time. Again, common sense dictates that there are more people who can afford a home priced at $350,000 than at $650,000…and so on. Last year in 2016, 43% of all Riverside closings took place in the $300-400K price range, as opposed to 17% for the 400K-500K range, and 7% in the 500K-600K range…and the numbers continue to drop as you go even higher.
So what does all this mean for sellers and buyers in the Riverside area?
First, as we have stated in previous newsletters, Riverside will always present itself as the affordable housing alternative to our neighbors in Orange and LA Counties…and this keeps our housing market strong and active.
Secondly, beware of the national media and their interpretation of the “housing inventory crisis.” Sure, our market could handle a few more houses for sale, especially in the $300K-$400K range, but be careful what you ask for. A strong real estate market is all about balance, and right now we are fairly balanced, with a slight tilt towards needing more inventory. Remember, a totally out-of-balance market is bad for either a seller or buyer (depends on which way we are tilting!). Nobody wants a repeat of the crazy market of 2000-2007, which was followed by the housing disaster of 2007-2012.
Remember…all real estate is local…and right here in Riverside, our prices and the availability of low interest rates gives us a strong housing foundation that is good for everyone.
Take care, and as always, I am only a phone call away if needed.
December 9th, 2016 — Uncategorized
Westcoe Realtors, Riverside Ca…One of our internet readers asked us this question today. It seems they were getting ready to list their home for sale with a local broker, and were getting all kinds of conflicting information about the duration of a standard listing contract, so they asked us if we could simplify the answer…and yes, we can make this very simple for any seller.
There is no standard time frame for a listing, and every seller has the right to list their home for as long, or short, a time period they and their Realtor can agree. In essence, it is totally negotiable between the seller and the real estate agent.
In most cases, the Realtor wants enough time for whatever marketing they intend to do for the seller to have time to work. Not many agents are willing to spend the money and time to market a home if the time frame is too short to see the results of the agents efforts. However, there is also a reasonable time limit to how long a seller is willing to commit to an agent, and this makes sense as well.
So…what is reasonable?
That depends on two major factors….the general activity of local real estate market, and the price range of the sellers home relative to the average sales price for the area.
If the local market is really slow, with few houses selling (for whatever reasons…high interest rates, no jobs in the area, etc.), then a seller can expect a listing broker to ask for a longer time frame for the listing…something that will more than cover the average time it takes to sell a home. Every area is different, but the agent should be able to give a seller the average time it takes to sell a home, and then both parties can take it from there.
When it comes to price range, just remember that the more the home is priced above the average sales price, the longer it can take to sell. That make sense, as in any market, there are always more buyers at the lower price ranges than at the higher range. Having a home that financially works for the most buyers will generally lead to a faster sale than a home that financially works for only a few.
In the end, just remember that the length of time for the listing contract is completely negotiable between the broker and the seller. Try to find the balance between too long and too short (anyone remember Goldilocks?), and all will be well….and if that doesn’t work, then keep your listing contract between 90-120 days, and that should work for both parties. Remember, you can always extend the time frame if the broker has done a good job.
Take care, and as always, thanks for reading our blog.
March 15th, 2016 — Uncategorized
Westcoe Realtors, Riverside Ca…This is a very interesting question, and one that has major relevance in today’s real estate market.
Most of the time, everyone operates on the assumption that a seller who puts his home on the market is ready to sell, and therefore, is capable of giving a buyer who makes an offer an answer rather quickly. The answer may be NO…it may be YES…or it may be a counteroffer on some point in the offer…but at least the buyer has an answer and can proceed accordingly.
BUT…what happens when the seller, for whatever reason, takes too long (days, etc.) to answer the buyer? What are the buyers options?
First, understand that in the standard Real Estate Purchase Agreement (RPA), the default time a seller has to get back to a buyer is 3 days from the date the buyer signs the RPA. Of course, the buyer is free when making the offer to shorten or lengthen this time frame, but most of the time, everyone rolls with the 3 day time period.
Secondly, there are lots of legitimate reasons why a seller could take more than 3 days to get you an answer. It could be they are out of town for a couple of days…or someone is sick and it’s best to wait until they feel better…or there is a family emergency…or who knows what. In cases where there seems to be a legitimate reason for this delay, it’s probably in the buyer’s best interest to simply wait until the time is right for the seller. After all, the buyer wants the seller’s cooperation on the offer, so showing some patience might be the best way to get the seller in a receptive frame of mind for the offer.
However, how about the situations where the seller is perhaps playing a “game” with the buyer? Perhaps the seller is trying to solicit other offers to get buyers in a bidding frenzy…or waiting to see if they a get a better offer…or testing the waters to see what they should do next…again, who knows what.
In cases like this, what can the buyer do?
Well, the bottom line here is that a buyer has two choices when and answer is not forthcoming in a timely fashion: Suck it up and remain patient if you want the house, or pull your offer and go somewhere else.
We wish there was a third alternative, but in the end, it’s the seller’s house and they can be as difficult to work with as they want. Yes, we get it…what you really want to do is scream at someone who is so self-centered as to play with your time and emotions, but that won’t get you very far. This is why you should have a real estate agent…someone who will be a buffer between you and the seller…someone who can calm you down, and remind you it’s in your best interest to remain patient and not “lose it”, because we seldom find that yelling at the seller enhances your offer!
So…if you ever find yourself in this situation, our best advice is to remain patient, resist the urge to pull your offer or scream at the seller, and take solace that when you eventually purchase the home, the seller does not come with the house!!
Trust us on this one…staying cool goes a lot further.
Take care, and as always, thanks for taking the time to read our blog…and let us know if you have any real estate issues you would like us to address in this space.
October 15th, 2015 — Uncategorized
Westcoe Realtors, Riverside Ca…Well…given human nature, we are back again with yet another way that a few nefarious individuals out there are trying to separate money from the honest people on our planet.
Today, we get to talk about one of the latest real estate schemes that seems to be making the circuit amongst the general public. The financial consequences of falling prey to this scam are not catastrophic, but we’re trying to do our best to eliminate even the minor irritations that could befall your real estate day.
Here’s how this latest scam works.
When you buy a home, sell a home, refinance a home, or sometimes simply change the manner in which you hold title to your home, there will be a title company involved. This title company will insure that any deed changes, loan changes, etc. are properly recorded, and that all parties are properly insured for whatever changes are being completed.
Once the transaction is finished, all pertinent documents for said transaction are recorded, which means that they are now public record. Public record means that anyone with a computer can see what changes were made, what you did, and what title company insured the transaction, or recorded the documents.
In the case of the “bad guy” scammers, they simply access your recently changed documents, find out what title company was involved in your transaction, and then they create a fake bill from said title company saying that there was an oversight in the closing, and that to insure that you have the proper title insurance, you still owe ____ amount of money to have your title insurance in effect.
Naturally, this is a bogus letter, but since the amount of money they area asking for is not too out of line (generally between $75-$295), many people pay the money. After all, who wouldn’t want to make sure their title insurance was in effect?
To set the record straight, while there certainly can be mistakes made in any transaction, if you ever receive a letter like this, simply pick up the phone and call whomever handled your closing to verify this demand for additional money. It is exceedingly rare that this type of mistake could ever happen, and your escrow company or settlement agent could set the record straight. We cannot imagine a scenario where a title company would contact a buyer/seller/homeowner directly and ask for more money…it just doesn’t happen in our industry.
So…we hope our little pubic service announcement today helps. No matter how much money is involved, it can ruin your day if some “bad guy” gets hold of your cash.
Take care, and as always, thanks for reading our blog page.
September 2nd, 2015 — Uncategorized
Westcoe Realtors, Riverside California…Like most industries, we in the real estate business have our share of horror stories…and our hope in sharing some of these with you is to save you from some of the messes we hear about.
Today’s topic: If you are the buyer of a home that is tenant occupied, unless you are planning on keeping the tenant in the home as a renter, don’t ever allow the escrow to close until the tenant is out, and you or your agent has physically verified the home is vacant.
The key to this situation is understanding the difference between a seller who is occupying the property at the close of escrow, and a tenant who is occupying the property…and again, we are not attorney’s here, so our CYA here is for you to talk to your attorney if you find yourself dealing with this problem. However, we can give you the benefit of our experience.
OK, now that we’ve established that, here’s what you need to know: a tenant has far more rights when it comes to removing them from a property at the close of escrow than a seller…rights that could cost you months of delay and agony while you make the payment on your “new” home that you can’t move into.
Just because the tenant has verbally agreed to move at the close of escrow doesn’t mean they will…and if they change their mind, refuse to move, have some big family crisis, etc., you are stuck, because getting a tenant out of a house they don’t want to leave can take 90-180 days (or longer), depending on the situation.
If you think you were hot when they didn’t move out, take your temperature when you are making house payments and can’t move into the house!
You can get a mad as you want with the previous seller (who said the tenant would be out), but once you, as a buyer, close the escrow, you have pretty much lost all leverage to get the tenant out. Understand, once you close escrow, the sellers problem now becomes your problem. Oh, you can sue the seller, and probably eventually get some money, but why go through the cost and hassle of all that?
Our advice….just don’t close the escrow until the tenant is out. Now, it’s the sellers issue, and since the seller wants their money from the sale of the home, let them deal with the tenant. Contractually, it is the seller’s responsibility anyway, so let them solve the problem.
All we are saying here is that when it comes to a tenant occupied property, protect yourself from the worst case scenario by making sure it can’t happen. With a seller in possession, you can call the police, present your paperwork, and they can pretty much get the seller to move because the seller never had an agreement to occupy the property. However, with a tenant, they DID have an agreement, and that agreement gave them rights, and only a court can decide how or when to enforce those rights….and that takes time.
So…avoid the hassle, heartache, and “money-ache” if you ever purchase a tenant occupied home, and just make sure they are out before you close…you’ll be very happy you did.
Take care, and as always, thanks for reading our blog…and let us know if you have any questions you might like to see answered here.
February 23rd, 2015 — Uncategorized
Westcoe Realtors, Riverside Ca…Today’s topic comes right from the real world of real estate. Here’s the scenario: the buyers, who are massively excited to close escrow on their new home, have jumped through all the hoops required these days to purchase a home. They have done their home inspection (at their cost, which is normal), signed almost a million forms for their lender, dealt with all the escrow demands, and are only days away from moving into their new home. As mentioned, excitement fills the air like the anticipation from a 10 year old for a visit to Disneyland.
So…since our buyers are ready to move, and they cannot contain their impulse to drive by the home, they do so…and discover to their utter dismay that the seller has let the lawn turn brown, some other landscaping has also deteriorated, and a quick peek over the fence reveals a pool that is greener than your gills after too much alcohol on New Year’s eve.
What happens now? What are their options?
Well, we’ll give you the technical answer, and then the real world options that you won’t find in a text book.
First, the legal, technical answer is that the seller is totally liable for the loss of the landscaping and the greening of the once pristine pool. The standard Residential Purchase Contract contains the following wording: (Paragraph 11)…”the Property, including the pool, spa, landscaping, and grounds, is to be maintained in substantially the same condition as on the date of Acceptance…”.
So…the seller has obviously failed to live up to their end of the contract, so they are responsible for the damage. OK…but now what?
Option 1 is to delay the closing of the escrow until the buyer is satisfied with whatever remedy they feel is necessary. Maybe the remedy is simply to begin watering the lawn and drain & refill the pool…maybe the remedy is new sod and the repair of some faulty pool equipment plus the water costs. Every situation is different.
Option 2 occurs when the escrow cannot be delayed (movers hired, loan docs set to expire, etc.). Here, then perhaps the remedy is for the seller to credit the buyer some amount of money (totally negotiable between the buyer and seller) that makes the buyer happy and gets the seller off the hook. If this is the route you take, just make sure enough that any money left by the seller is enough to cover any costs…because there is generally no going back to the seller once you have accepted the cash for the problem.
Option 3 occurs when the seller is a jerk, won’t credit the buyer any money, and the buyer still wants the house, and the escrow must close without delay. In this case, then remember…the seller is still contractually bound for any damages that occur from letting things “go”, so simply document the damage (green pool, dead lawn, shrubs, etc.), and your remedy will probably have to be small claims court. If you go this way, remember…small claims court is a pain-in-the-you-know-what, but it will eventually get you where you need to go, which is an award against the seller.
In the end, we sincerely hope you never have to deal with a situation like this…it really takes the damper off the excitement of buying a new home. However, if real estate life throws you a lousy seller who lets this happen, then our suggestion is to try options 1 or 2…and only use Option 3 if you must. Good luck…and lets keep the green in the lawn, and not the pool!
January 5th, 2015 — Uncategorized
Westcoe Realtors, Riverside California…Yes, Toto…it’s that time of year when our clients want us to break out the “old crystal ball” for a quick peak into what we feel will be happening in our local Riverside real estate market for 2015. So, with deference to the Great Karnac himself, based upon our 29 years of selling real estate in our city, here is what we see happening in this New Year ahead.
In a nutshell…if you liked 2014, then you will like 2015. Stable is the name of the game, with steady growth on the horizon for this next year…and here is why we think that way.
First…Riverside remains the affordable answer to the crazy home prices of our neighbors in Orange and Los Angeles Counties. There has always been a real estate triangle between the 3 counties, and when prices climb like they have the past few years, Riverside is the main beneficiary of these out-of-control hikes. The drive to work may be a pain, but at least one can afford a nice home (or a first home for that matter) in our area, instead of renting some apartment for more than the monthly payment on a great home in Riverside.
Secondly…There has been very little new home building in our area…and this leads us directly to the supply and demand equation for real estate. The demand for housing in Riverside is very steady, and when the supply of new homes is limited, then the demand for existing homes will stay strong. At some point in time, the new builders will jump back into our market, but for now, this demand for existing homes will keep appreciation for homeowners nice and steady.
Thirdly…The Inland Empire job market, by almost all measures, is rebounding quite nicely. We are not economists here at Westcoe, but almost everything we read is very positive about jobs in our area. It wasn’t that long ago the only discussion about jobs in Riverside was how many we lost…now the shoe is on the other foot, and jobs are on the rise. Naturally, the more jobs we have, the more people who can afford a home…and since we have the affordable housing inventory as mentioned above, the bodes extremely well for our local market.
Lastly…Let us not forget our dear old friend…home loan interest rates. There isn’t much we can say here we haven’t said before, but just remember…today’s low interest rates are the best friend a real estate market can have. You can talk all you want about the above referenced reasons for a great 2015, but it all begins and ends with low interest rates…and the good news is that barring some world wide calamity, there is nothing on the horizon that would indicate a major revision in home interest rates. You can still get around 4% (sometimes a little lower, sometimes a little higher…depends on your timing), and that is pretty amazing.
In the end, the real estate market after 2007 was financial carnage for almost every one who owned a home. Prices fell further than anyone could ever imagine, and the recovery took longer than anyone wanted to believe…and yet here we are…on the upside of history. Our real estate market of 2015 is the market of stability, low interest rates, and conservative optimism…a nice picture for everyone.
Take care, and Happy 2015 from Westcoe.
December 11th, 2014 — Uncategorized
Westcoe Realtors, Riverside California…Boy is this a question we get asked a lot at this time of year. As a homeowner, is it a good time to sell your home during the holiday season, or is it better to wait until after the first of the year? So…we will weigh in here in an attempt to put everyone on the correct holiday path…
…and the answer is…It can’t hurt!
OK…here’s the pros and cons. YES…we totally acknowledge that sales slow down to some extent during the month of December, especially the closer you get to Christmas…BUT…understand that there are buyers in the market even at this time, and the good thing about all those buyers is that they are SERIOUS. Everyone understands that life is hectic enough on a good day, much less when you put the stress of holiday shopping in the mix…which is why those buyers who are also looking for a house must be really serious about their need to purchase a home…and as a seller, that is exactly the type of buyer you want in your home when it is up for sale.
Also, for most people, while there can be a certain amount of holiday chaos in anyone’s home, generally a home will show really well during December. Decorations, baking…all the good stuff that we associate with the holidays go a long way to making a home warm and inviting. We wouldn’t suggest you leave your decorations up until Easter to keep this feeling, but normal decorations for this time of year are a great way to show a buyer the holiday potential of your (and maybe their) home.
Sometimes a seller is worried about all the holiday buyers who will be interfering with their activities, but remember…we acknowledge that there are fewer buyers out there at the moment, so your world will not really be turned upside down with a massive number of showings. Yes…you hope to get some, but the volume of showings will be less than normal, and certainly not too much to handle. You can always ask the real estate agent to come back at a different time if the showing is really in the middle of your sacred holiday event, but trust us….it won’t be a stampede that keeps you from enjoying your family.
Some sellers worry that if the home does not sell during the month of December, then it will look like it has just “sat there” for too long, and that perhaps a buyer will think there is something wrong with the home. Again…there may be a small (and we repeat…small) number of buyers who look at a home for sale that way, but this is not true during the holidays. Every seller gets a “free pass” on this issue at this time of year. There will not be any “stigma” for a home not selling during December, so you can relax.
In the end, trying to time the sale of your home to the “ideal” time of year is like trying to decide when to wash your car in the winter. You can watch all the weather reports you want, but it’s going to rain sometime, so the bottom line is wash your car when it’s dirty, and leave the weather to a higher power. In the case of your home, our best suggestion is that if you want to sell, then sell…and if you want to wait, then wait. There is no right or wrong here…but remember…you can’t score if you are not in the game, so if want to sell, put your home on the market and maybe you’ll catch one of those serious buyers out there during the holidays. After all….it can’t hurt.
November 21st, 2014 — Uncategorized
Westcoe Realtors, Riverside Ca…We all know that things change…such is the nature of life. Who ever heard of sweet potato fries 5-10 years ago…now try living without them. Same for curly fries. And just try to find “white-wall” tires. If you even know what these are, then you are over 40…and no car back-in-the-day would ever be caught without white, side-wall tires. Our point here is that things change all the time, and when it comes to the real estate business, we are no exception.
Take termite reports and clearances for example (nice tie-in, eh?).
Generally speaking, up until about 2006, if a buyer was purchasing a home and getting a new loan, then the new lender wanted a termite report and clearance. The thought was that if they were going to lend hundreds of thousands of dollars on said home, they wanted to make sure the home wasn’t going to crumble. The lenders might have said they wanted to protect the buyer, but who they really wanted to protect was themselves…if the buyer got some protection along the way, so much the better…but they were really just looking out for themselves.
Therefore, since almost all housing sales had a new loan, then almost all sales had a termite report and clearance. And who paid for this report and clearance? The seller. It wasn’t law, but custom dictated that in 99% of all sales that required a termite report and clearance, the burden for delivering the home termite-free fell to the seller. The cost for this report is around $50-75, and if any work needed to be done to rid the home of pesky termites, then the tab could run into the thousands, depending on the situation.
Now fast forward to the years after 2007, when there were more bank repossessions than Starbucks. Now the shoe was on the other foot, and the banks were the sellers…and guess what? The “seller” banks started telling the new “lending” banks that they would not do any termite work, would not provide a clearance, and if the new “lending” bank didn’t like it, then they could pass on making the loan…and since the new “lending” banks really wanted to make the new loans (since there weren’t that many people buying homes at that time), lo and behold, the new lending banks all of a sudden stopped requiring a termite clearance.
Wow…hard to believe a bank would put their own profits ahead of protecting the consumer.
So…termite reports and the resulting clearances started a slow decline in our transactions. Since the new lenders no longer required a clearance, then more and more buyers stopped asking for them…especially when trying to purchase a bank repo. As competition for these repos became more fierce, buyers stopped asking for a clearance so their offer to purchase looked better than the next guys…and a new culture was born in the real estate business with regards to termites.
And how does all this stand today, since bank repos are not really part of the real estate scene anymore?
Well, it’s mixed. Conventional and FHA financing no longer require a termite report and clearance, while VA financing still wants to know that the home will not crumble around the new VA buyer. We see many transactions where the buyer still wants a termite report and clearance, many where the buyer simply wants a termite report but no clearance, and many where the termite situation is ignored all together. In fact, the new California Association of Realtors Standard Purchase Contract (effective Nov. 24, 2014) no longer lists the termite report as one of the pre-printed options for a buyer. This can still be written into a purchase contract, but it is not automatically included anymore.
The moral of this story? There is none…do whatever makes you feel good. As a buyer, we recommend that you at least get a report to know if you will have any issues with your new home. As a seller, be prepared to at least provide this report, and where you and your potential buyer go from there is up to you both. Every real estate transaction is unique, but our suggestion is to work it out for the sake of both the buyer and seller…
…but NO, in most cases these days, a seller is NOT required to provide a termite report and clearance.
Take care, and as always, thanks for reading.
September 3rd, 2014 — Uncategorized
Westcoe Realtors, Riverside Ca…There is a saying that goes like this: “Common sense is not so common.” No where in the real estate world is this more relevant than when it comes to sellers wanting to take some items with them as they depart their home for the last time. Therefore, we thought as a real estate public service announcement, we might shed some light on what is cool and what is definitely “not-cool” when it comes to a seller vacating his home with stuff that should be left behind.
Understand that the seller can take whatever they want if they have notified the buyer they will be taking it, and the buyer has approved it in the purchase contract. Heck, the seller can strip the home if the buyer has said it is OK in writing. Most of the time, the seller will identify that they want to take, for example, the entry chandelier, or perhaps the matching drapes in a bedroom…something like that. However, in the absence of the buyer allowing the seller to ransack their new home, there are a few basic rules that the seller must follow.
The easiest way to figure out what the seller can legally take without having the buyer freak out is this: if the item is permanently attached to the home, then it stays…if it is not permanently attached, it can go. A classic example is a light fixture that is swagged…which means the light is hooked to the ceiling and the power cord is draped to an outlet in the wall. This is obviously not permanently attached, and therefore could go with the seller. Contrast this to a light fixture that is directly wired into the ceiling and controlled by a light switch on the wall. This is permanently attached, and must remain.
When it comes to “stuff” outside, the rules are basically the same. Pool equipment, wired light fixtures, and awnings should stay, while swing sets, trampolines, and all pool skim nets, brushes, and rubber duckies can go with the seller to their new home. Free standing tool sheds can be a gray area (how are they built, are they bolted to a slab, etc.) so it is best to simply have included in the contract whether they stay or can go to avoid any misunderstandings.
In an effort to clarify what can and cannot go, the purchase contract lists some of the things expected to stay with the home. A partial list is…ceiling fans (unless swagged), window coverings, TV antennas, window and door screens, garage door openers, mailbox, all landscaping unless it’s in a pot, and mailboxes. Believe it or not, every one of the above is listed because some seller failed to use the “common sense” approach and tried to take one or more of these with them on the way out the driveway. We know of one case where the seller even rolled up his front yard grass and tried to take it with them. Seriously?
In the end, our best advice is that if you are unsure what you can take, ask your friendly real estate agent what you can legally do. A real estate transaction is complicated enough without added a whole new layer of lunacy, so when in doubt…ask. It just might save you from having to re-install your grass in front of your buyer while your old neighbors have a good laugh at your expense.
Take care, and as always, thanks for reading our blog. Let us know if there is any issue you would like to see addressed here…we would be happy to oblige.