I just got back from a brief vacation visiting dear friends on
charming Balboa Island, located in Newport Harbor in Orange
County.
This community was initially a summer getaway for people, and
the island was carved into small lots that often housed a tent or
small cabin. Later, it became a series of small cottages. Today
those same cottages are often purchased for several million
dollars. Whoa, doggies!
I just got back from a brief vacation visiting dear friends on charming Balboa Island, located in Newport Harbor in Orange County.
This community was initially a summer getaway for people, and the island was carved into small lots that often housed a tent or small cabin. Later, it became a series of small cottages. Today those same cottages are often purchased for several million dollars. Whoa, doggies!
But that’s not all: These domiciles are razed and replaced by large, opulent homes. Can you imagine spending a couple of million dollars for a house you intend to destroy and replace? And we think our real estate is too expensive!
Anyway, coming back from the Land of Expensive Houses, it seems time to take a look at the upper market in San Benito County and south Santa Clara County. First let’s consider San Benito. The overall inventory stands at 384, which is higher than it has ever been. In the million dollar plus market segment we find 72 homes are available.
There are only nine homes that are in escrow, awaiting the completion of sale. At this rate, we have an 8-month supply of homes available today. In south Santa Clara, inventory is 538. There are 215 homes over one million dollars, and 36 are in escrow. This means there is about a 6-month supply.
You can surmise houses are selling more slowly, creating a pool of sellers whose expectations have not caught up with the changing market. We are indeed in what seasoned agents call a “normal” market. The frantic pace of the past few years has become a steady, calm trudge. Sellers, be patient. Make your house beautiful to view, and price it at the bottom of your market segment. Buyers, get out there and enjoy the benefit of a plethora of houses to delight your senses and meet your needs.
For those of you considering selling your home yourself, the operative word is don’t! First of all, in days past it was easy to stick a sign out and get a buyer. Now the buyers are fewer and farther between. Secondly, when the emphasis was on securing one of the rare available homes many of the “little things” like contingencies and repairs were not too important. The buyer was just grateful to get a home at all! Now the areas of negotiation are coming back in play, and you need the assistance of a professional to keep yourself competitive and to keep you in legal compliance on all issues.
Here’s just one simple example of the problems a For Sale by Owner (FSBO) seller can find himself mired in: Advertising. “What?” you ask. You heard correctly. Let’s look at an example. Mr. FSBO has a wonderful house to sell. He puts an ad in the paper that reads, “Beautiful totally remodeled family home in wonderful neighborhood with 3 bedrooms and 2 baths. Magnificent views from every window. Walking distance to schools and shopping. Big back yard with Jacuzzi tub off of spacious family room.”
Sound good? Well, this ad is in violation of the Fair Housing laws that do not allow discrimination based upon race, color, national origin, religious preference, sex, familial status, or handicaps.
“Family home” says the property will be sold to a family … dad, mom and kids. “Wonderful views” discriminates against people who are blind. “Walking distance” discriminates against those in wheelchairs. “Family room” has the same problem as “family home.”
No, I’m not making this up. Mr. FSBO is in violation of the law.
Another issue Mr. FSBO could face down the road in a court of law comes from the term “totally remodeled.” Is this a true statement? He may have painted the walls, re-done the flooring, and replaced old single-pane windows with new Milgard ones. But did he actually swap out all the plumbing and electrical systems? Get all new appliances and plumbing fixtures? You see the word “totally” is a total nightmare!
And that Jacuzzi tub? Is it actually manufactured by Jacuzzi? Or is he using that name loosely, the way we say “Kleenex” instead of tissue, or “Xerox” instead of copy.
This example is just a simple one to introduce a bigger concept. It is not easy to sell a home and stay on the good side of the law. A cursory glance at the California Association of Realtors’ legal page indicate that over two dozen major laws have been passed so far in 2006, dealing with issues covering far-ranging facets of real estate including condominium and mobile home sales, unlicensed individuals posing and working as Realtors, electronic signatures, Internet use and advertising, bankruptcy, disclosure issues, tax implication, privacy considerations, unsolicited faxes, etc., etc., etc.
Now I’m sure Mr. FSBO is intelligent enough to sift through all this information, but does he really want to spend his time this way, especially in light of the fact that most FSBO sellers sell their homes for at least 7 percent less than those listed with a Realtor?
Well, the answer to that rhetorical question will indicate truly how intelligent he is!
Until next week, remember it’s a good life, and be kind to your Realtor.
