Facebook
Twitter
Pinterest
Copy Link
Trying to Save Money on a Loan Can Be Costly
Our client found the perfect home for an incredible value. We negotiated the sale and a fabulous offer was secured for our buyer. He had instant equity upon closing. But the sale never closed.
We'd recommended lenders to him, but he chose to use another lender. Why? Because he would save $1000 in closing costs.
Unfortunately, this lender rarely spoke to the buyer and would not return our phone calls. Without this communication, it was clear what was happening. Nothing. After two weeks, our client got nervous and decided to switch to a recommended lender. This lender was getting the job done, but having lost the first two weeks of the transaction time, this lender asked for a week's extension.
The seller refused to extend the closing date to accommodate the extra needed time for financing. He decided he'd sold his home for too low of a price and he could get more money for his home. He wanted to put his home back on the market. Our buyer lost this fabulous home and the equity he would've had if he'd been able to close the sale. The equity he lost was worth far more than the $1000 he could have saved on the loan.
It's always important to work with a lender who'll get the job done for you. It's even more critical in our fast paced market. Sellers may not be inclined to let you change lenders or extend the closing time. If you change lenders after the offer has been accepted, the seller has to agree in writing to the lender change. You, as the buyer, can't just up and change lenders without the seller's permission, as you could be in default on the contract and lose your earnest money.* What if you need an extension? The seller also has to agree to any extension to the closing date. If the seller doesn't agree in writing to an extension, then the offer dies on the original closing date and the seller is free to sell the home to another buyer.
Keep in mind how important it is to use a lender with fair pricing, but also a lender who has a proven track record to get the job done. Get referrals from your Realtor, friends or family. Choose a known quanity to do the job. You could lose a lot more than $1000, you could lose the home you want to buy.
*As always, with any legal issues, it's important to seek the appropriate legal advice from an attorney.
In This Hot Real Estate Market, Do You Still Need a Realtor?
Many homes are selling in a matter of days. So why do you need a Realtor?
In this hot Seattle Eastside real estate market, Realtors help you earn the most money for your home before it goes on the market, when an offer is negotiated, and after the offer is accepted.
Here's how Realtors help you make the most money:
Before you go on the market:
- Help you prepare your home for sale- recommending only those things that will help you make more money.
- Recommend good contractors who get the job done.
- Accurate pricing-the key to success. Having the latest pricing information, so you get the most for your home. In other words, setting a price the day before you go on the market. In today's market, pricing from a week ago may no longer net you the most money for your home.
- Stellar marketing with staging, well written descriptions, and fabulous professional photography.
- Be available to agents and buyers who have questions and want answers about your home.
Here's what we do when offers come in:
- Negotiate the offer(s).
- With the lack of inventory, many homes attract more than one buyer at the same time. It can be a delicate balancing act to manage the different agents/buyers. We must maintain a positive and honest working relationship with all buyers so that you, the seller, don't lose anyone during the negotiation phase. The ultimate goal is to secure the best offer for you. It may be the highest price, the best closing date, the best financing and inspection timeline or any combination of these terms.
After the offer is signed:
- First and foremost is making sure all the deadlines in the contract are properly met.
- The contract needs to be sent to escrow, the lender and the title company.
- Earnest money needs to be collected and verified.
- Proper receipt of the disclosure form is needed.
- Negotiating the inspection. This is a huge part of the transaction process. Buyers expect everything to be perfect and sellers know they are not seling a new home and no home is perfect. It can often be a very emotional time for both parties. Striking the right balance between these expections is important to keeping an offer together.
- Working with an appraiser. With prices going up because of the intense competition, appraisers have to scramble to justify increases in prices in a short period of time. A good Realtor will know about the homes that have sold and can help navigate through this process, etc.
- Following the transaction through closing, until you get your check!
Here's just a sample of issues that can come up during the time of the sale to closing:
- One party dies, loses their job or gets transferred.
- The buyer charges to much on their credit card, increasing their debt and no longer qualifying.
- The inspection does not reach a solution satisfactory to both parties and the offer falls apart.
- A question comes up on your title report, such as encroachment on your property. This must be resolved before the closing.
- The square footage of your home does not match county records, creating an uphappy buyer.
- Repair work required by an inspection is not performed properly.
Every home, seller, and buyer is unique. Therefore, every transaction is unique. Some transactions are very smooth and everything goes like clockwork. Much of the time these transactions go smoothly because the Realtor has anticipated any issues and has handled them efficiently to minimize any stress during the transaction. Most sellers don't think about it, but a lot of the work a Realtor does takes place before the sign goes in the yard and after an offer is signed.
Sometimes things happen that are out of anyone's control and a Realtor who is experienced and knowledgeable will be able to guide you from the beginning to the end. It really doesn't matter whether it's a hot market or a slow market. Experience is an invaluable commodity when buying or selling a home.
How Do You Go From For Sale To Sold on Seattle’s Eastside?
Moving from "For Sale" to "Sold"
How do you get from “for sale” to “sold?” It’s the price! Even though the real estate market in Bellevue, Kirkland, Redmond and other eastside cities is red hot, the price is still critical to getting a “sold” sign posted on the “for sale’ sign in your front yard.
Almost half, 48%, of the homes for sale between September, 2011 and March, 2012 sold in 10 days or less! With these homes only on the market for fewer than 10 days, the homeowners and their Realtors did everything right. The homes had to be priced right, show well, have fabulous photos and great marketing or the homes would not have sold.
Seeing these incredible numbers should help blow several common misconceptions out of the water:
1. Should you leave negotiating room when you set the price for your home? NO. Some homeowners think they should leave bargaining room. This, however, will send that homeowner down a path toward a longer market time and a lower selling price. Look again at the top line of the first chart. Almost half the homes sold within 99% of asking price and in under 10 days. With sales prices coming in at 99% of the asking price, there was little bargaining in the final sales price.
2. What if you want to price your home high because you’re in no rush to sell? A homeowner who overprices a home will shoot themselves in the foot. Let’s say a buyer is out searching to buy a home and sees 5 homes. The buyer will compare each one’s price, location, and features. They don’t compare whether a seller is a rush to sell or has all the time in the world. The buyer won’t know that. The buyer will only know that when comparing the homes, the overpriced home will stand out. Most buyers don’t bother to make an offer because there are 4 other homes that are more attractive and priced right. There’s no need to waste time pursuing an overpriced home because, even though the supply is low, there are other homes on the market. If today’s market pricing doesn’t meet a homeowner’s needs, then don’t put the home on the market.
3. Were these homes underpriced, because they sold so quickly? No. In today’s real estate market, we’re dealing with very savvy buyers. They know the market and they know pricing. They know when they see a home that’s well priced and they’ll pay for it. The buyers don’t have time to waste. The good homes are going fast. Secondly, does anyone really think that half of the homes that sold in the last 6 months were underpriced? I don’t think so!
The other 52% of the homes took 149 days to sell and sold with an average of a 10% discount. If you look at the second chart, you can see for every 30 day period a home is on the market, the selling price drops. Homes that were on market for a long time were the homes in which sellers could bargain with the buyers, but it usually meant the price dropped. Buyers think a home is overpriced or there’s something wrong with it if the house is on the market for more than a month in this market.
If you decide to sell your home, you’ll need to decide in which half of the market you’d like to be. Do you want to be in the market in which your home could sell quickly and for a good price or do you want to test the waters, take your time, and more than likely sell for less? It’s your decision.
A Booming Real Estate Market in Kirkland, Bellevue, Redmond And Other Eastside Cities in February, 2012
The February Real Estate Map shows a strong sellers market.
Multiple offers, low supply of homes, a huge percentage of homes selling in a short amount of time, all are happening in the eastside communities of Bellevue, Redmond, Kirkland, Issaquah, Woodinville, and Bothell. This is an exciting trend that we expect will continue as long as people feel good about the economy, Seattle companies are hiring and there is this shortage of homes for sale. The national press is jumping on the bandwagon and reporting the uptick in the real estate market. However, I believe this is not happening everywhere. We are among the fortunate areas in the country that are experiencing this positive real estate market.
Almost half of all the homes for sale in Kirkland and Redmond sold this past month! That’s astonishing odds. The cities below are grouped together to follow our MLS areas (multiple listing service). This is how our statistics are reported.
1. Redmond/East Bellevue
The odds of selling a home were 49%
Median sales price decreased from $435,000 to $400,000 (y-o-y)**
113 homes were for sale
A total of 35 homes sold
Days on the market: 84
2. Kirkland
The odds of selling a home were 48%
Median sales price decreased from $457,000 to $442,000
140 homes were for sale
A total of 38 homes sold
Days on Market: 98
3. The plateau: Sammamish, Issaquah, North Bend, and Fall City
The odds of selling a home were 40%
Median sales price decreased from $514,000 to $442,000
There were 428 homes for sale
A total of 100 homes sold
Days on the market: 121
4. South Bellevue/Issaquah
The odds of selling a home were 33%
Median price decreased from $580,000 to $525,000
239 homes were for sale
A total of 43 homes sold
Days on market: 118
5. Woodinville/Bothell/Kenmore/Duvall/North Kirkland
The odds of selling a home were 32%
Median sales price decreased from $366,000 to $360,000
368 homes were for sale
A total of 105 homes sold
Days on Market: 115
6. West Bellevue
The odds of selling a home were 20%.
Median sales price increased from $840,000 to $960,000
123 homes were for sale
A total of 15 homes sold
Days on Market: 133
7. Redmond/Education Hill/ Carnation
The odds of selling a home were 4%
Median sales price increased from $382,000 to $515,000
205 homes were for sale
A total of 29 homes sold
Days on Market: 152
If you’d like more specific information about your neighborhood or home, feel free to contact either Brooks or me.
*(The odds of selling a home in each area is a result of the number of homes for sale divided by the actual number of home sales, so if 10 out of 100 homes sold, the odds of selling would be 10/100 or 10%)
** (y-o-y) median pricing is comparing year over year numbers.
The Top Ten Remodeling Mistakes for Seattle Eastside Homes
There are a million stories in Seattle about great remodeling projects that increase the livability and value of a home. I’ve written a few myself over the years.
Rarely does anyone write about what you should NOT do when remodeling a home. One caveat here, what plays in Peoria does not necessarily play in Seattle, Bellevue or Redmond. Every area of the country has different styles, so remodeling trends will vary according to the region of the country. So if you live in the eastern suburbs of Seattle, such as Bellevue, Redmond and Kirkland, this post is for you!
This post was inspired by an email I received from George Rinehart of Rinehart Inspections. We’ve added to his list because of some remodeling mistakes we’ve seen in homes over the years. Unfortunately, we’ve had to tell some sellers their homes may be worth less because of a remodeling mistake.
Here are the top ten remodeling mistakes:
- Eliminating the garage.
- Eliminating one bay or a 1/2 bay of a two car garage.
- Adding a sunroom.
- Taking out all the grass in your yard.
- Taking down a fence that encloses the backyard.
- Reducing the number of bedrooms by enlarging one or turning one into a closet.
- Installing different color carpets throughout the house.
- Eliminating windows.
- Taking out a bathroom to increase another room’s size.
- Eliminating a laundry room and moving it to the garage.
The elimination of a garage to increase living space is a perfect example of a remodeling mistake. Not having a garage can easily be a $25,000-$30,000 reduction in the asking price for a home. Even with the price reduction, many buyers won’t even look at a home without a garage. Not having the garage keeps many buyers from walking through the front door. A laundry room is another thing most people want, so to eliminate one to increase space for something else is usually not a good idea.
Ultimately, every home is salable for a price, but some of the changes listed can be expensive, not only for the cost to do the remodel, but also in market time and the ultimate sales price for a home. Many of the above changes may work for you as an individual or family, but not for the next home owner.
There are other costly remodeling mistakes. Can you think of any others that could “cost” a home owner dollars when selling their home?
Was There Really a Decline In Seattle Eastside Real Estate Pricing in October, 2011?
Seattle Eastside Real Estate Sales-October, 2011
Yes, Virginia, there was a decline in median pricing on Seattle’s eastside in October. The Seattle media got everyone a little nervous about real estate when it stated there had been a 15% y-o-y price drop in King County real estate prices from October of 2010 to 2011. I talked with several clients who were speaking doom and gloom about the eastside real estate market based on the news stories. I suggested they look at the true numbers for the eastside, not the entire county. The article discussed all of King County, which includes areas that are not doing as well as the eastside. Seattle and the eastside cities, such as Bellevue, Kirkland, and Redmond, are the shining stars of King County real estate. If you look near the bottom of the article, it states the decline in eastside real estate prices measured in the single digits, not 15%.
The decline on the eastside depends on what you were looking at when comparing the numbers. Median sales pricing declined by 9% from last year, but the average sold prices increased from $602.000 to $619,000. It’s more of a mixed bag, although no home owner likes to see any sort of a decline.
Why the decline in median sales pricing? Here are some possible reasons:
- Jumbo loan rates have gone up, limiting the number of buyers who can buy at the higher end of the market.
- Distressed sales take up a large portion of the home sales all over the county. Distressed sales, short sales and foreclosures, usually sell for less than market value, thus causing the median pricing to drop.
- Lastly, the numbers you see here are a result of the real estate sales activity that happened that particular month only. In order to see a trend, it is important to look at a number of months together. One month is only indicative of that particular month’s sales.
Remember real estate is hyperlocal and North King and South King County are different real estate markets than Seattle’s eastside. In one of my next posts, I’ll look at the eastside real estate market even more closely and show the hottest and coolest selling areas.
Now that we have that issue of the decline in median pricing examined more closely, let’s take a look at what happened with eastside real estate in October. There were 24% fewer homes on the market this October than last and 22% more homes sold than in 2010. There were also 8% fewer homes on the market than in September of this year. Sales increased by 22% from last year and by 11% from September of this year.
Most home sold within 97 days and for about 92% of the original asking price. Sellers had a 23% chance of getting their homes sold last month. These are strong numbers, much stronger than October of 2010.
I’ll be watching the sales trend over the next couple of months. I expect to see fewer homes on the market and fewer sales as we approach the holidays. But will median pricing decline? What do you think?
Our Blog/Website has a New Look!
Brooks and I see ourselves as real estate advisors, not sales people. We spend a lot of my time consulting with our clients about how best to update and remodel their homes so they can get the best price when selling.
Updating and remodeling a home is a hot topic these days. This is why TV shows such as Extreme Makeover have been so successful. I hear from my niece, who works on reality TV shows in Los Angeles, there are make-over shows for all kinds of things.
The reality is lots of things in our lives besides our homes need an update, even if there isn’t a reality TV show about it. Sometimes we need a personal overhaul: new haircut, new clothes, new weight, new job, new hobbies, etc, etc. I’ve done the new haircut, lost weight, and purchased the new clothes over the last few years and I don’t plan to change jobs in the near future.
However, I needed internet professionals to advise me to update my website/blog. It was something on my “to-do” list, but I just hadn’t gotten around to doing it. What I needed was a professional to get me moving on this, much like our clients need some direction updating their homes. They need a real estate professional to encourage them through the process. I needed someone to give me the push to update the site and get this task off my “to-do” list.
The site is still a work in progress as we continue to add things. We hope you like the new “do,” the new look. We’ve even updated our photos!
The Old Look
The Old Photo
Thanks to Drew Meyers, the iron man of Virtual Results and the Geek Estate blog and special thanks to Brandon Matson of bizgarden for handling all the details and educating us on our new site.
Which Seattle Eastside City had the Fastest Real Estate Sales in September 2011?
Aubrey Cohen wrote an article about the fastest selling neighborhoods in Seattle, which prompted me to write this post about the fastest selling neighborhoods on Seattle’s eastside. What happens in Seattle, doesn’t just stay in Seattle, it also happens here on the Eastside!
Homes in East Bellevue and Redmond near Microsoft sold the fastest on Seattle’s eastside in September. Not only did these homes sell more quickly, in 69 days, but out of the 204 homes for sale, 51 got offers. These means that 25% of the homes in the area sold in September, among the best odds on Seattle’s eastside. The odds of selling a home in the Woodinville, Bothell areas also stood at 25%, which means September was one of the best months to sell a home in those cities.
Why do homes in East Bellevue and Redmond sell more quickly? Because they’re close to employment centers and transportation and have a broader range of more affordable housing. With the main Microsoft campus in Redmond and on the border of Bellevue, there’s a huge number of jobs right in the area. In addition, there’s easier freeway and bus access to Seattle than in the outlying suburbs.
West Bellevue is the most expensive area on the eastside, although it’s proximity to Seattle, schools, and housing make it the premier location on the eastside. The higher price point in the area means fewer buyers can afford West Bellevue, which increases the market time. Longer market time here is a function of pricing, not desirability.
Why is market time important? It’s one indication of the desirability and affordability of an area and both are key to future growth and appreciation. People like to live in convenient areas with good schools and affordable housing. (Remember affordability is relative to each area of the country.)
The cities below are grouped together to follow our MLS areas (multiple listing service) and shows how our statistical information is reported.
Which Seattle-eastside city had the fastest selling homes?
1. Redmond/East Bellevue
The odds of selling a home were 25%.*
Median sales price decreased (y-o-y)** to $503,000 from $560,000.
204 homes were for sale
A total of 51 homes sold.
Days on the market: 69
2. Kirkland
The odds of selling a home was 21%.
Median price increased from $516,000 to $626,000.
270 homes were for sale.
A total of 57 homes sold.
Days on Market: 87
3. South Bellevue/Issaquah
The odds of selling a home were 18%.
Median price decreased from $533,000 to $529,000.
362 homes were for sale.
A total of 65 homes sold.
Days on market: 88
3 (tie). Woodinville/Bothell/Kenmore/Duvall/North Kirkland
The odds of selling a home were 25%.
Median price was down from $415,000 to $380,000.
558 homes were for sale.
A total of 139 homes sold.
Days on Market: 88
4. The plateau: Sammamish, Issaquah, North Bend, and Fall City
The odds of selling a home were 19%.
Median sales price increased from $486,000 to $500,000.
There were 714 homes for sale.
A total of 137 homes sold.
Days on the market: 90
5. Redmond/Education Hill/ Carnation
The odds of selling a home were 19%
Median pricing increased from $541,000 to $580,000.
321 homes were for sale.
A total of 62 homes sold.
Days on Market: 100
5. West Bellevue
The odds of selling a home were 19%.
Median pricing decreased from $956,000 to $936,000.
164 homes were for sale.
A total of 31 homes sold.
Days on Market: 127
Overall, market time is excellent in all of the eastside cities. As I mentioned above, Seattle-eastside real estate is one of the bright spots in the country. Companies in the area are hiring and people continue to want to live here because of the quality of life, the job market, and good schools.
If you’d like more specific information about your neighborhood or home, feel free to contact either Brooks or me.
*(The odds of selling a home in each area is a result of the number of homes for sale divided by the actual number of home sales, so if 10 out of 100 homes sold, the odds of selling would be 10/100 or 10%)
** (y-o-y) median pricing is comparing year over year numbers.
The Seattle-Eastside Real Estate Market Feels Good!
Seattle-Eastside Real Estate Sales through September, 2011
Seattle’s eastside real estate market was very steady in September, 2011. It’s not dramatic with the highs and lows of the recent past, which is refreshing, plus eastside real estate sales are moving and moving well. It looks as if the peak of real estate sales for the year was back in May, when 24% of the available homes got offers. However, in September overall sales dropped only slightly, to 21%. The sales average of 21% means out of the 2713 homes for sale, 563 sold.
Real estate sales on the eastside improved dramatically when compared to last year. This means we’re experiencing a more normal, realistic market in 2011 than in 2010. There are fewer homes on the market and 33% more homes sold on the eastside this September when compared to last year. Our less volatile real estate market is our new normal and really is not bad at all!
On average, most homes were on the market for 90 days before they sold. Homes sold within 93% of the original asking price with the median sales price for the eastside at $526,000.
5 Ways to Tell Your Home is Priced Too High
Your home has been on the market for more than 30 days. Is your home overpriced?
Here are good some ways to tell if your home is overpriced:
- No one comes to see your home. Since everything is online now, buyers decide which homes they want to see, sharing this information with their broker before they even get in the car. The buyers have calculated cost per square foot, looked at the photos, checked out the location, access to public transportation, the schools, etc. If a home seems overpriced for what it offers when compared to the competition, the buyer or the Realtor may nix the showing. The buyer may never come to see your home.
- A lot of buyers come see your home, but only for one showing. There are no second showings. This means buyers have ruled your home out for what could be many reasons (see below) and don’t believe the value is there to make an offer. The buyers have already moved on to other homes.
- None of the showing agents call to ask questions, which means their buyers do not have an interest in your home. They’ve ruled out your home because it is not value priced.
- Your home is too dark, too small, lacking a bedroom, etc. No one expects you to add to your square footage or change anything structurally, but if this is the feedback, your home is not matching the asking price. Buyers compare your home to other homes for sale. They have an expectation of what a home should offer at a certain price point. If your home is smaller, has smaller rooms, lacks a bedroom, is darker, etc., compared to the competition, then it’s overpriced and will only make the competition look good. You can’t change these things about your home, but you can change the price to eliminate some of these objections. Years ago I had a home listed for a higher price than I recommended to the seller. There were a number of showings in which the feedback was negative. The seller was devastated. He had a well maintained home with a beautiful sun room addition and gorgeous landscaping. As soon as the price was reduced, the feedback changed. Buyers and agents thought the home was fabulous. Nothing about the house had changed, only the price. With the new price, came terrific feedback and an offer.
- Other homes are selling, but your home is not. If nearby homes and homes in the general price range are selling, and your home is not, then it’s overpriced.
By no means is this a complete list of why homes are overpriced. There are many other reasons as to why a home does not sell because of price, can you add to this list?
