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Real Estate News: Short Sales

September 24th, 2012

A short sale is the selling of real estate at a price lower then its mortgage. This is because it has a current market value less then the amount of money owed

on it. In a short sale the borrower needs to enlist a Realtor experienced in the short sale process. The Realtor will meet with the borrower to discuss establishing the current market value of the property, the marketing strategy and how they will work with the mortgage lender to reach agreement on an approved sale price. In order to successfully negotiate a short sale with the mortgage lender the borrower must establish they are experiencing a true financial hardship and can no longer keep up with their mortgage payments. The mortgage lender may agree to approve selling the property at a discount but this decision does not always release the borrower from the obligation to pay the remaining mortgage balance known as the deficiency.

Because a short sale is less expensive then a foreclosure the mortgage lender is usually agreeable to a small loss, the borrower can sometimes mitigate the damage to their credit report and the buyer can purchase a well-priced property in good condition, many times in much better condition then a foreclosure that may have been abandoned.

For more information on our short sale services contact L.A. Metro Home for a one on one consultation Contact Us.

9000 W. Sunset Blvd. 11th Fl., West Hollywood, CA.

(310) 498-4942

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Tips on getting your offer accepted by the seller

August 9th, 2012

Are you in the market for a home, up against multiple offers and no acceptance? Below are some tips to getting your offer accepted by the seller.

How solid is your offer? Shorter contingency and escrow periods, asking for fewer or no seller concessions and allowing the seller to select services show’s them you mean business. Going into a deal with a list of demands sends the message this property may not be the right fit for you.

Are you pre-qualified or pre-approved? Most every approval will have conditions of appraisal and the type of property you select. However, pre-qualifications that require the buyer submit hard copy of information that has only been verified by application or phone may not be received well by sellers. Take the time to get all of what your lender requires so you are as close as possible to that Full Document Pre-approval. It makes a world of difference to the seller.

Who is your lender? Are you working with a credit union, local mortgage broker, small neighborhood bank or large national chain? Each of these will offer a different level and quality of customer service, there may also be important differences in the paperwork flow. Be as transparent as possible on who you are using and make sure your lenders contact person is prepared for the seller to call and verify all your information.

Are you stretched to thin? If you are going into this with not a lot of savings but very strong credit and work history, build your case to seller; include a note from you explaining why you’re an excellent candidate.

Who are you? Tell a little about yourself. An introductory letter letting the seller know about you, why you want the house and how you are qualified to buy the home will give you an edge over the rest. Buying an REO (foreclosed bank owned property) or a short sale will be a little different since the process is less personal, ask your Real Estate agent for the best approach in all cases.

Choose your agent. Do not underestimate the value and experience of your Real Estate agent. The market has changed, there are a lot of Short Sales, Bank Owned (REO,) Probate, Trust & Bankruptcy Sales out there mixed in with the Standard Sale, ask your agent about the differences and their approach to getting your offer accepted considering these various scenarios.

Paul Cruz, Realtor 310-498-4942, paulcruz@associatesregroup.com

 

Multiple offers, overbidding, buyer beware

August 2nd, 2012

Buyers beware shopping for your dream home may not be so dreamy. If you’re looking for a upgraded 2 to 3 bedroom home near good schools, shopping and transportation be prepared for multiple bids with properties opening escrow before their first open house.

Chances are if that home is starting to appeal to you, and you’re thinking of making that offer, so are many other buyers.

What happened to the flood of foreclosures, bank owned, distressed properties that were, and are, lingering in bankbooks. With investor deals being negotiated in conference rooms this inventory may never hit the open market? Or will it?

10 Questions to Ask Your Realtor about Selling a House

July 30th, 2012

 

10 Questions to Ask Your Realtor about Selling a House

  1. Are you a full-time professional real estate agent? How long have you worked full time in real estate? How long have you been representing buyers? What professional designations do you have?
    Knowing whether or not your agent practices full time can help you determine potential scheduling conflicts and his or her commitment to your transaction. As with any profession, the number of years a person has been in the business does not necessarily reflect the level of service you can expect, but it is a good starting point for your discussion. The same issue can apply to professional designations.
  2. Do you have a personal assistant, team or staff to handle different parts of the purchase? What are their names and how will each of them help me in my transaction? How do I communicate with them?
    It is not uncommon for agents who sell a lot of houses to hire people to work with them. As their businesses grow, they must be able to deliver the same or higher quality service to more people.
    You may want to know who on the team will take part in your transaction, and what role each person will play. You may even want to meet the other team members before you decide to work with the team. If you have a question about fees on your closing statement, who would handle that? Who will show up to your closing?
  3. Do you have a Website that will list my home? Can I have your URL address? Who responds to emails and how quickly? What’s your email address?
    Many buyers prefer to search online for homes because it’s available 24 hours a day and can be done at home. So you want to make sure your home is listed online, either on the agent’s Website or on their company’s site. By searching your agent’s Website you will get a clear picture of how much information is available online.
  4. How will you keep in contact with me during the selling process, and how often?
    Some agents may email, fax or call you daily to tell you that visitors have toured your home, while others will keep in touch weekly. Asking this question can help you to reconcile your needs with your agent’s systems.
  5. What do you do that other agents don’t that ensures I’m getting top dollar for my home? What is your average market time versus other agents’ average market time?
    Marketing skills are learned, and sometimes a real estate professional’s unique method of research and delivery make the difference between whether or not a home sells quickly. For example, an agent might research the demographics of your neighborhood and present you a target market list for direct marketing purposes.
  6. Will you give me names of past clients?
    Interviewing an agent can be similar to interviewing someone to work in your office. Contacting references can be a reliable way for you to understand how he or she works, and whether or not this style is compatible with your own.
  7. Do you have a performance guarantee? If I am not satisfied with your performance, can I terminate our listing agreement?
    In the heavily regulated world of real estate, it can be difficult for an agent to offer a performance guarantee. If your agent does not have a guarantee, it does not mean they are not committed to high standards. Typically, he or she will verbally outline what you can expect from their performance. Keller Williams® Realty understands the importance of win-win business relationships: the agent does not benefit if the client does not also benefit.
  8. How will you get paid? How are your fees structured? May I have that in writing?
    In many areas, the seller pays all agent commissions. Sometimes, agents will have other small fees, such as administrative or special service fees, that are charged to clients, regardless of whether they are buying or selling. Be aware of the big picture before you sign any agreements. Ask for an estimate of costs from any agent you contemplate employing.
  9. How would you develop pricing strategies for our home?
    Although location and condition affect the selling process, price is the primary factor in determining if a home sells quickly, or at all. Access to current property information is essential, and sometimes a pre-appraisal will help. Ask your agent how they created the market analysis, and whether your agent included For Sale by Owner homes, foreclosed homes and bank-owned sales in that list.
  10. What will you do to sell my home? Who determines where and when my home is marketed/ promoted? Who pays for your advertising?
    Ask your real estate agent to present to you a clear plan of how marketing and advertising dollars will be spent. If there are other forms of marketing available but not specified in the plan ask who pays for those. Request samples or case studies of the types of marketing strategies that your agent proposes (such as Internet Websites, print magazines, open houses, and local publications).

We look forward to earning your business.

The L.A. Metrohome Team

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Luxury boom, the rich go shopping

July 23rd, 2012

Bigger, better and All Cash is the game. In a world where the adage is “Less “IS” Less” and “More “IS” More” there is no shortage of cash making deals in well heeled Los Angeles neighborhoods.  Homes in affluent areas of Hollywood Hills, Beverly Hills, Bel Air,  West Hollywood and to the East Historic Hancock Park, just to name a few, garnish million dollar price tags and can sell in a matter of days.

With inventory running thin, multiple offers are not uncommon driven by prices, that though eye popping, are still at a discount compared to what could have been 5 years ago. While the debates continue over the future of jobs and the economy some folks have the means to going shopping and they’re doing just that.

Redfin reports Rising Demand, Falling Supply….

July 16th, 2012

Redfin: Rising Demand, Falling Supply Driving Home Prices Up

07/13/2012 By: Tory Barringer Printer Friendly View

Real estate broker Redfin released the June results of its Real-Time Home Price Tracker, showing home price increases in nearly all 19 major U.S. markets.

The tracker showed an average year-over-year price gain of 3 percent across all major markets and a monthly gain of 2.6 percent. Sales volumes also rose year-over-year (a 7.4 percent increase) but fell 1.1 percent month-over-month. Overall inventory levels declined, falling 25.3 percent from June 2011 and 2.4 percent from May this year.

The price data, combined with an earlier Redfin report that showed demand broadening, points to a strengthening market, said Redfin CEO Glenn Kelman. Kelman expects prices to continue to rise, but said he’s interested to see what happens next.

“Prices in June rose year over year for the second straight month, but the true test lies ahead,” said Kelman. “For the first time in five years, we’re seeing sellers enter the market to take advantage of rising demand, not just out of sheer necessity. We thus expect listing prices to increase, even as employment remains weak and Europe’s debt crisis continues. In competitive markets like the San Francisco Bay Area, buyers will likely rise to the bait. Elsewhere the market may falter.”

Out of the 19 markets served by Redfin, 16 showed annual price increases, with Phoenix posting the greatest gains (28.7 percent, the only double-digit year-over-year increase in all markets). Of the markets that posted decreases, Long Island suffered the most (a 4.4 percent drop). In month-over-month data, 16 markets showed price increases-Portland and California’s Inland Empire stayed flat, and Austin fell 0.1 percent.

Additionally, the tracker showed that homeowners who listed their homes sold very quickly, with all single-family homes listed in the first three weeks of June finding a buyer within two weeks of debut. The San Jose market actually saw 52.5 percent of homes selling within that short time frame.

While sales occurred quickly, the number of closings grew only modestly since last year, owing partly to lack of inventory. Closings of single-family homes increased 4.3 percent since last year. The biggest drops in sales volume were found in places where inventory was in shortest supply: Sacramento, San Jose, the Inland Empire, and Denver.

 

Latest update from Foreclosure Radar

July 16th, 2012

Inventory continues to decline. The following report is copied from Foreclosure Radar, Foreclosure Report 2012.

 
Top Story
 
FORECLOSURE INVENTORY CONTINUES TO DECLINE
 
June 2012 Foreclosure Sales were significantly down in the three largest foreclosure states in our coverage area. California Foreclosure Sales were down 13.4 percent over last month, and down 48.8 percent vs. June 2011. Arizona Foreclosure Sales were down 18.5 percent over last month, and down 42.1 percent vs. June 2011. Nevada Foreclosure Sales were down 14.6 percent over last month, and down 72.1 percent vs. June 2011 driven by the new regulation that took effect in October 2011. In addition, Foreclosure Filings are flat to down in all states in our coverage area, both on a month over month basis and vs. previous year. Arizona Notice of Sales were down 27.7 percent over last month, Nevada Notice of Defaults were down 22.7 percent over last month, and California Notice of Defaults were basically flat, being down 0.9 percent over last month.We already have significantly low home sales in the market today, and with the declining level of Foreclosure Sales the inventory will continue to decrease. In California, banks take on average 272 days to resell properties they take back at auction, thus, realtors, investors, and homebuyers should brace themselves for significantly less inventory in next years’ selling season.

Los Angeles Reconstructed

July 11th, 2012

As the debate continues over the state of the Real Estate market, developers and entrepreneurs build their own future by creating an ‘up’ market reconstructing the urban Los Angeles landscape.

Be it in Downtown L.A., Hollywood Hills, West Hollywood or the many adjacent areas, it’s nothing new driving down a city block where there might be several homeowners in default, the occasional bank owned foreclosed home and suddenly a construction site for a new mixed use development, new luxury home or fix and flip.

Builders, developers, investors, even some savvy Real Estate agents have been capitalizing on the low cost of money and plentiful distressed inventory.

Properties that are incredibly well priced may entice the average buyer but they are realistically out of reach. Boarded up or with too many health and safety violations to list, the average buyer cannot get a loan on these properties so its open territory for the buyer with “All Cash” to pick up and restore. They are refurbishing property in too poor condition for your conventional loan to then put back on the market like new and lendable.

Old distressed mini malls and vacant lots in bustling Los Angeles urban locations are also being picked up, coming back reconstructed as vibrant mixed used developments with condos, apartments, retail, restaurants and hotels. Construction sites are popping up everywhere. Inventory is thinning and competition for prime property increasing. Could the bottom of the Real Estate market have passed us up? You decide.

Practicing good seller’s etiquette

July 11th, 2012

Practicing good seller’s etiquette

Let’s face it: When your house goes on the market, you’re not only opening the door to prospective buyers, but also sometimes to unknown vendors and naïve or unqualified buyers. As with any business transaction, there is an expected protocol to how sellers, buyers and their respective agents interact. Should you find yourself in a sticky situation, alert your agent so he or she can address and remedy the problem.

The aggressive agent
When your agent puts your house on the market, typically all promotional materials state clearly that your agent is the primary contact for buyers and buyers’ agents. However, sometimes a buyer’s agent will contact a seller directly to try to either win over their business or cut the seller’s agent out of the deal. This is not reputable behavior and you should report it to your agent immediately if it happens to you.

The unscrupulous vendor
Have you ever started a business or moved into a new house and suddenly found your mailbox full of junk mail? Unfortunately, this also can happen when you put your house on the market. When you sell your home, it necessitates all kinds of new purchasing decisions and less-than-ethical vendors are keenly aware of this. Though MLS organizations enforce rules on how posted information is used, some companies have found ways to cull information from various sources to produce mass mailing lists. If you find yourself regularly emptying your mailbox of junk, let your agent know. He or she can tap the appropriate sources to prompt an investigation into the matter.

The naïve buyer
Yard signs, Internet listings and other advertisements can generate a lot of buzz for your home. Some prospective buyers – particularly first-timers – will be so buzzed to see your home that they’ll simply drop by. If this happens, no matter how nice these unexpected visitors are, it’s best not to humor their enthusiasm by discussing your home or giving an impromptu tour. Instead, politely let them know that your real estate agent is in charge of scheduling tours and provide them with the agent’s contact information. If you attempt to handle these surprise visits on your own, you might inadvertently disclose information that could hurt you during negotiations down the road.

Paul Cruz, Realtor

310-498-4942, 9000 W Sunset Blvd. 11th Fl. L.A. Ca 90069

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Eight steps to selling your home in Los Angeles

June 25th, 2012

Below are 8 essential steps to selling your home. Take a glance or read thoroughly.  Take a moment to call LA Metrohome so we can answer any questions you might have.  We will help you make the most of your selling experience.

  1. Define your needs.
    Write down all the reasons for selling your home. Ask yourself, “Why do I want to sell and what do I expect to accomplish with the sale?” For example, a growing family may prompt your need for a larger home, or a job opportunity in another city may necessitate a move. For your goals, write down if you’d like to sell your house within a certain time frame or make a particular profit margin. Work with your real estate agent to map out the best path to achieve your objectives and set a realistic time frame for the sale.
  2. Name your price.
    Your next objective should be to determine the best possible selling price for your house. Setting a fair asking price from the outset will generate the most activity from other real estate agents and buyers. You will need to take into account the condition of your home, what comparable homes in your neighborhood are selling for, and state of the overall market in your area. It’s often difficult to remain unbiased when putting a price on your home, so your real estate agent’s expertise is invaluable at this step. Your agent will know what comparable homes are selling for in your neighborhood and the average time those homes are sitting on the market. If you want a truly objective opinion about the price of your home, you could have an appraisal done. This typically costs a few hundred dollars. Remember: You’re always better off setting a fair market value price than setting your price too high. Studies show that homes priced higher than 3 percent of their market value take longer to sell. If your home sits on the market for too long, potential buyers may think there is something wrong with the property. Often, when this happens, the seller has to drop the price below market value to compete with newer, reasonably priced listings.
  3. Prepare your home.
    Most of us don’t keep our homes in “showroom” condition. We tend to overlook piles of boxes in the garage, broken porch lights, and doors or windows that stick. It’s time to break out of that owner’s mindset and get your house in tip-top shape. The condition of your home will affect how quickly it sells and the price the buyer is willing to offer. First impressions are the most important. Your real estate agent can help you take a fresh look at your home and suggest ways to stage it and make it more appealing to buyers.

    • A home with too much “personality” is harder to sell. Removing family photos, mementos and personalized décor will help buyers visualize the home as theirs.
    • Make minor repairs and replacements. Small defects, such as a leaky faucet, a torn screen or a worn doormat, can ruin the buyer’s first impression.
    • Clutter is a big no-no when showing your home to potential buyers. Make sure you have removed all knick-knacks from your shelves and cleared all your bathroom and kitchen counters to make every area seem as spacious as possible.
  4. Get the word out.
    Now that you’re ready to sell, your real estate agent will set up a marketing strategy specifically for your home. There are many ways to get the word out, including:

    • The Internet
    • Yard signs
    • Open houses
    • Media advertising
    • Agent-to-agent referrals
    • Direct mail marketing campaignsIn addition to listing your home on the MLS, your agent will use a combination of these tactics to bring the most qualified buyers to your home. Your agent should structure the marketing plan so that the first three to six weeks are the busiest.
  5. Receive an offer.
    When you receive a written offer from a potential buyer, your real estate agent will first find out whether or not the individual is prequalified or preapproved to buy your home. If so, then you and your agent will review the proposed contract, taking care to understand what is required of both parties to execute the transaction. The contract, though not limited to this list, should include the following:

    • Legal description of the property
    • Offer price
    • Down payment
    • Financing arrangements
    • List of fees and who will pay them
    • Deposit amount
    • Inspection rights and possible repair allowances
    • Method of conveying the title and who will handle the closing
    • Appliances and furnishings that will stay with the home
    • Settlement date
    • Contingencies At this point, you have three options: accept the contract as is, accept it with changes (a counteroffer), or reject it. Remember: Once both parties have signed a written offer, the document becomes legally binding. If you have any questions or concerns, be certain to address them with your real estate agent right away.
  6. Negotiate to sell.
    Most offers to purchase your home will require some negotiating to come to a win-win agreement. Your real estate agent is well versed on the intricacies of the contracts used in your area and will protect your best interest throughout the bargaining. Your agent also knows what each contract clause means, what you will net from the sale and what areas are easiest to negotiate. Some negotiable items:

    • Price
    • Financing
    • Closing costs
    • Repairs
    • Appliances and fixtures
    • Landscaping
    • Painting
    • Move-in date Once both parties have agreed on the terms of the sale, your agent will prepare a contract.
  7. Prepare to close.
    Once you accept an offer to sell your house, you will need to make a list of all the things you and your buyer must do before closing. The property may need to be formally appraised, surveyed, inspected or repaired. Your real estate agent can spearhead the effort and serve as your advocate when dealing with the buyer’s agent and service providers. Depending on the written contract, you may pay for all, some or none of these items. If each procedure returns acceptable results as defined by the contract, then the sale may continue. If there are problems with the home, the terms set forth in the contract will dictate your next step. You or the buyer may decide to walk away, open a new round of negotiations or proceed to closing. Important reminder: A few days before the closing, you will want to contact the entity that is closing the transaction and make sure the necessary documents will be ready to sign on the appropriate date. Also, begin to make arrangements for your upcoming move if you have not done so.
  8. Close the deal.
    “Closing” refers to the meeting where ownership of the property is legally transferred to the buyer. Your agent will be present during the closing to guide you through the process and make sure everything goes as planned. By being present during the closing, he or she can mediate any last-minute issues that may arise. In some states, an attorney is required and you may wish to have one present. After the closing, you should make a “to do” list for turning the property over to the new owners. Here is a checklist to get you started.

    • Cancel electricity, gas, lawn care, cable and other routine services.
    • If the new owner is retaining any of the services, change the name on the account.