Take Advantage of the Buyer's Market!

With over 2,300 real estate listings in Santa Clarita alone, of which all are fighting for the smaller pool of buyers, it has created what is known as a Buyer's Market. While a lot of buyers are sitting on the sidelines, waiting, hoping, praying, crossing their fingers that prices go down more, there are a few savvy people out there taking advantage of "deals", deals that otherwise haven't been around for years.

Seller concessions. Its a great thing if you are a buyer with little cash in reserves, but have an income to justify the mortgage payment. Why is it such a great thing? Well, imagine in a normal market that you want to buy a home. You enter escrow on it. You then are informed of the amount needed to close escrow, aka CLOSING COSTS. Typically these will run anywhere from $5,000 to $15,000 on a first time buyer's purchase. Now, imagine if you will, paying NO closing costs. Imagine, receiving a credit from the seller that not only covers ALL of your closing costs, but leaves money left over for you to apply towards buying your interest rate on a loan down, which in turn will make your monthly payment less expensive. Sounds nice right? Well, that my friends (and hopefully future client), is just part of the idea behind seller concessions.

This sort of thing rarely happens in a "Seller's market", but that isn't the case, we're in a Buyer's market, so its happening quite a bit these days - and as I mentioned, there are some SAVVY buyers out there getting some GREAT deals! While there are of course some sellers out there who are simply sticking to their "guns" and not budging on ANYTHING, there are about 50 other Sellers to that 1 who will be happy to entertain your "creative" offer.

Now in order to get "creative", and make the best offer possible, you really need the assistance of a Realtor who knows their stuff (hhuhm), because your choice in Realtor, you know that person who is supposed to negotiate a great deal on your behalf, could cost you thousands of dollars, or SAVE YOU thousands of dollars. When choosing your Realtor, make sure to ask for a list of properties they have successfully closed escrow on in the past 12 months. If they give you a list of 0, 1, 2, or 3 ...make sure to look very closely at other aspects of their qualifications, and how knowledgeable they sound when answering your questions.

So you have the perfect Realtor, and its a Buyer's market, now what? I know this is not a revolutionary idea, but here it goes...LOOK FOR A GREAT DEAL, SOMETHING UNDER MARKET VALUE! Now that you are amazed by my great idea, I will tell you some of the best ways to find a great deal.

Some key factors that CAN LEAD to a GREAT deal in the making:

• A property that is priced about 5% or more below its best competition
• A property that has been listed for a LONG TIME - over 90 days, over 120 is even better
• A property that is vacant and has a stressed seller making two mortgage payments
• A property that has been served with a Notice of Default, and the owner has Equity!
• A property that needs some minor TLC, something you can fix yourself, but discount real dollars off the sales price for
• A not so hot looking property in a GREAT neighborhood, with one or ALL of the factors listed above in play
• A property that is offering up-front that seller will pay some or all closing costs
• A property that is or is potentially a short sale, with one or ALL of the factors listed above in play

Those are just a few items to look out for when on the hunt for a great deal. Personally, I love to look at how long its been listed. If its been listed a LONG TIME, with NO price changes, you may have a problem in that the seller is not motivated to sell. This is a BUYERS MARKET. So we are looking for the sellers that realize this and are looking to SELL, and move on with the equity they "currently" have. Ask your Realtor to investigate and see how motivated the seller is if you come upon a property that sparks your interest. Your Realtor can simply place a call to the listing agent and learn a great deal about the seller and the seller's "situation" (ie Moving out of state, Needs larger living space, Divorce, etc).

Tomorrow the Federal Open Market Committee will vote on whether or not to leave interest rates at bay 5.25% (8.25% prime rate for banks, credit cards, HELOCs) or hike them due to fears over inflation that still seems to be somewhat present. The current level of demand for housing could see a more fierce drop were the FED to increase rates again. However they have left them alone for the last 3 meetings, as inflation fears have seemed more calm in recent months. So hopefully, for all of you who want to purchase a home in the coming weeks or months (and have little money down), let hope for a continued pause in interest rate increases and lets start taking advantage of some of these deals in the Santa Clarita housing market.

Call me for all of your real estate needs @ 661 373 2374

Want to sell your home? Trying to sell "By Owner"?? Then you MUST go to Why List With Robert.com

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California Foreclosures WAY UP!

In a report out this week from RealtyTrac, California has shown a 40% increase in foreclosures JUST over the last 2 months! We have supassed Texas and Florida for having the "most new forclosure filings" in the country.

In September, there were approx 14,806 owners entering some stage of foreclosure! That is over 3 times as many in September 2005. That figure equates to 1 forclosure filing for every 825 households. This does not mean that the home has been foreclosed on, just that the proceeding has commenced for such action.

The nations largest foreclosure rates were recorded in Michigan, Colorado, and Nevada. Other states reporting foreclosure rates among the nation's 10 highest were Florida, Georgia, Indiana, Illinois, Texas, Ohio and Utah. Nationwide, foreclosure activity has increased 63% from this time last year. An incredible figure.

Are things really that bad though? While the trend isn't one that is pleasant, it was expected with this real estate downturn. At the height of our real estate boom, many buyers,especiallyy broke first time buyers, were leveraging theirmortgagee to the hilt, and mortgage brokers were more than happy to accommodate. Nothing down? Stated income?Negativee amortization loan? SURE WHY NOT! Everyone was making money hand over fist with they way the market was appreciating. Well, all good things come to an end, okay, maybe a slooowwwsmoothh end, and people who purchased about a year ago or less, and those who took all of the equity in their home as if it were an ATM card have no place to go. Their home values aren't really rising any more. In the past when they couldn't afford the payments, you just got an equity line of credit, and paid your more pressing debts! No longer is this the case.

Lenders are being extra careful when they appraise a properties value now, to make sure they aren't over lending on a home that is potentially decreasing in value monthly. If the homeowner has no equity, the homeowner can no longer get that equity line, they can no longer "cash out". So what do they do...they sell and do a "short pay" (where you make an agreement with lender to sell for less than is owed on the home) and make NO money off their "investment", and or they FORECLOSE. I guess they could always make more money and just pay their mortgage, but that is much easier said than done.

As I mentioned, this foreclosure rate increase was expected. There were foreclosures happening in the height of the boom...just much less of them. The media will soon lose interest in reporting the surging increase in foreclosure rates, and will move on to other items of interest.

Just as I read articles of gloom and doom, I read of hope and positivity. The latter just gets reported much less often, if at all - you have to dig for it. Housing demand for instance, is expected to remain, I won't say remain strong, I'll just say remain. It's better than not being there at all! Low interest rates will be the key factor to keeping demand in-play. The fed meets again on Oct 24-25th to decide whether or not to keep rates at bay for the 3rd straight time or not. While inflation is a concern of the federal reserve, they realize the effect rising interest rates will have on the already staggering housing market.

In Santa Clarita we have "less" to worry about, as opposed to other areas of California, and regions in the country. We have a very strong local job economy. Santa Clarita is an unusually clean, well put together, master planned community (city actually). The schools are great, there is a variety of shopping to keep you in town, and now with things such as a Valencia comedy club, the city is keeping you here for entertainment as well. There really is not another city MUCH like it, if at all. The demand will always be a BIT higher here than in most parts of LA County and California for that matter.

Inventory of homes currently for sale in Santa Clarita is falling slightly, this was expected to happen as Summer passed and winter & holidays approach. Remember, lower inventory is better for sellers, in that prices won't fall as much if at all, and high inventory means more decisions for buyers, which equates to more seller competition (downward pressure on prices).

It will be interesting to see where Fall/Winter '06 leads us and what kind of year 2007 will be. Lets just get through the rest of the year and enjoy the coming Holiday season!

For all your real estate needs...call me @ 661.373.2374

Want to search ALL SANTA CLARITA HOMES FOR SALE? Go to The Scv Agent.com and click MLS SEARCH!

Want to sell your home? Trying to sell "By Owner"?? Then you MUST go to Why List With Robert.com

Its been 2 months!

I can't believe its been about 2 months exactly from my last post. Shame on me. The real estate world needs me. So here I am. It has been an eventful 3rd quarter for me. Aside from my wife and I buying a new home, I have had one of my best quarters ever for sales - who said the real estate sky is falling?

I apologize for the absence to those of you who enjoy reading this post. I am committing to "blogging" from this day forward...at least once a week, hopefully 2 or 3 times a week schedule permitting.

Like I said, I have been extremely swamped with business this last quarter, mostly buyers, and since it has cooled down for me over the last two weeks, its time to get back to the basics.

As for the market, it really is something to behold. One moment people are making money buying and selling homes, money money money, hand over fist...Now, unless its your primary residence, nobody is buying and expecting to make a buck - at least in the near future, myself included. The run up of prices for several years, limited affordable housing, limited incomes, a media campaign to wish a bursting bubble upon us, and of course the enormous inventory of homes for sale has all but taken the last measure of air from a heavily inflated real estate market. Yes there is still some activity going on, as I noted from my own experience, but its mostly those who MUST move, MUST buy, and or are simply just positive thinkers and don't let the negativity of others get to them.

The number of homes for sale was bloated to around a 7 or so month supply, nearing at its height to about 2,600 homes for sale in Santa Clarita Valley during this summer. I am happy to tell you that the spooked sellers trying to get top dollar one by one are retreating by taking their home off the market for another day. They weren't serious sellers in the 1st place. They just caught "wind" from some TV outlet or work place water cooler conversation that prices are falling, and they thought they would get as much as they can - as soon as possible. Well when everyone is doing that very same thing, buyers in turn get a nice menu of homes to choose from, in turn making each seller compete heavily with on another spurring downward pressure on prices. . So who sold successfully? Basically the "serious" sellers sold, and on average, they were the ones who HAD to get to their "new job assignment", "couldn't afford mortgage payments", "had a baby and were outgrowing residence", etc etc etc...bottom line - they were serious about getting it sold and did what it took to do so, which normally meant listening carefully to their Realtor's advice.

No longer can you put your home on the market, and list 5-10-15% above the last one sold. To be honest, the last one's sold hardly matter with so much currently for sale, and so LITTLE in escrow - especially with prices holding steady and in some cases going down a "tad-bit". In order to sell (for you serious sellers), you must be extremely competitive about pricing, and more knowledgeable than ever about the differences in value between nearby sellers of similar product and your home. You can't over price for your "upgrades" either. A buyer these day will go for the cheaper home with same plan and no upgrades - they will just assume doing the upgrades themselves and save a buck, we have become a do-it-yourself nation you know!

Over all, this situation, has created a great buying opportunity for buyers. It's been a long time since the buyer had the upper hand, no less had a choice of 3-5 homes within on tract and no competition. The sellers are now competing for buyer business.

In the coming months, if inventory continues to decrease, this could be good news for sellers in that it creates less of a choice for the buyers who are actually out there looking. Less supply = good for seller. More supply = good for buyer.

As of today we have about 2,410 homes for sale in Santa Clarita. The buyers still have the upper hand. However, if you are serious about selling your home, team up with a Realtor that KNOWS the inventory and competition. You need a FULL SERVICE REALTOR, not a limited services/discount broker. Their goal is to get as many listings in volume as possible in order to make a profit. How can they serve your needs and give you the best advice when they are beholden to so many other sellers at the same time? You call them and get a voice mail! Its a lose lose situation. In this market, they don't end up selling your home & earn a minimal commission, and you don't end up selling your home & putting your equity in the bank!

Call me @ 661 219 2260 to discuss your potential sale or purchase. You'll be glad you did.

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