Archive | Buyer Education

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San Carlos Real Estate Recap & Forecast – August 2013

Posted on 27 August 2013 by vvandervort

Clearly, the trend for the San Carlos real estate market has been up for the past few years, but where are we going from here?  You can see from this graph that March and May of this year gave us the highest sales prices in the past 24 months.  Sales prices in June and July decreased from their previous month.  So what will become of August?  My sense from what I’ve been experiencing in the market is that August is likely to be back up.  Interestingly, interest rates in  June and July were climbing.  While that was happening, we definitely felt a hiccup in the real estate market.

As interest rates have stabilized over the past few weeks, we have continued to experience multiple offers and properties selling over the asking price.  On average, they have been selling 8% above the asking price and selling in 11 days on average.  The preliminary numbers for August show an average sales price in San Carlos of $1,297,000, which would be just slightly higher than March and May of this year.  This data shows us that the San Carlos market is headed back up for August.  Certainly buyers in the area have a lot of enthusiasm for San Carlos and are looking to buy in our community! We continue to experience limited inventory, which is working to the seller’s favor.

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How to do a “move-up” buy

Posted on 10 September 2012 by vvandervort

Bursting at the seams in your current San Carlos home? If so, you are likely considering whether you should expand your current digs or attempt the “move-up”.  Since we all tend to like the status quo and don’t like to tread into the unknown, I thought I’d take the opportunity to shed some light on how one goes about doing a move-up transition in San Carlos or frankly, whatever town you may be residing in along the peninsula.

One option is that you buy first.

There are two ways of doing this.  If you have the cash available for your down payment without selling first and if you can get pre-approved while carrying your first home, then you are free to go off and purchase the new home while still holding on to your current home.  The beauty of this is that you are not left homeless.  You can close on the new home, move into it, and then get your old home on the market.  The downside of this is that you could get stuck with two homes.  I actually had this almost happen to some clients of mine back in the Summer of 2008 when the market cooled very quickly during the “mortgage meltdown”.  They thankfully got the home sold before it really got bad, but they were lucky.

The other way of buying first is that you make it contingent upon you selling your home.  This is much less risky, but it is also very limiting.  You can only go after homes where the seller will consider this and that typically only happens when homes have sat on the market for a while.  So if you want the house that everybody else wants, then you’re not going to get it if you have to make your offer contingent upon selling your current home.  You are left with the over-priced and the unwanted – at least when our San Carlos market is hot.  If you go with the “contingent offer” maneuver, then you negotiate how long you have to get your home into contract – usually about 2-4 weeks.

Next option for you move-up San Carlos buyers, is to sell first.

This is wading into the big unknown because what you do know is that you are going to sell the roof over your head and head off to who-knows-where.  There are short term rentals in the vicinity (my clients have had the most success in Foster City for finding an apartment to rent for 3 months).  You can even choose to move there before you put your home on the market which will make it less stressful having your home on the market.  However, optimism abounds and lots of people put their house on the market, get it into contract, and then start seriously searching for their next home with the thought that you could get something and not have to move twice.  I always work to negotiate as long of a rent back as possible for my sellers so that they can increase their chance of finding another home before they have to move out and decrease their chance of having to move twice.  The downside of the “sell first” option is the distinct possibility of having to move twice.

If you are going to sell first, another way to do it is that you sell with it subject to you finding a replacement home – then you guarantee you don’t have to move twice.  This doesn’t go over too well with the prospective buyers because many of them have deadlines for having to get settled and they can’t be left hanging while you try and find a home.  It makes it much tougher to get multiple offers on a home when you can only work with buyers who can work with your requirement to find another home first.

Control & Negotiation

Everyone wants a deal – the best deal they can get.  What I can tell you for sure is that you will have the most control and give yourself the greatest chance at negotiating if you sell first and then buy after you’ve closed on your current home.  This also gives you the best chance of getting the home you want when you go to buy because you aren’t left with the “leftovers”.

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My Day From Hell: Appraisal Issues in San Carlos and the Surrounding Cities

Posted on 19 April 2010 by vvandervort

fire backgroundWatch out… appraisal issues in San Carlos and the surrounding communities are a real possibility right now.  A week ago today, I got a phone call from a mortgage person that I work with from Bank of America and received the terrible news that a home in Belmont that my buyers were in contract on, had the appraisal fall short.  And it wasn’t short by just a small amount, it was a BIG amount – over 9%!  To me, it appeared that the appraiser didn’t even look at higher sales to make the appraisal work.  One interesting thing, was that there were 5 offers on this property and there was another offer on the property that was pretty much the same as my buyers’ offer.  Of course, appraisers don’t have a way of using that information in their appraisals.

Bank of America does has a path to follow for disputing appraisals, but the time line for that was uncertain and my buyers were to remove their financing contingency on Friday.  We had three options.  We could wait and see if we could get new information(sales that were about to close) to the appraiser to increase their appraisal amount or we could do what we call a Double or Dual App or the buyers could just back out.  The buyers went for the double app because they really want to buy this home.

In a double app, you apply for a loan through a 2nd lender.  I have just one lender I go to when the shit hits the fan and it is Princeton Capital.  They have an amazing track record of keeping deals together that otherwise would have fallen apart.  My buyers did an amazing job of getting all of their financial details to Princeton Capital in a matter of hours on Monday afternoon (and if  you’ve been through the loan process lately, you know that is a huge feat).  On Tuesday, I got a phone call from the appraiser who thankfully lives in Belmont and understands our local market (some appraisers come in from east bay counties and do not understand our market) and we set up an appointment to meet at the property on Wednesday morning.  I left our appointment on Wednesday morning feeling pretty confident since the appraiser said to me that he does his homework before he goes out to a property for the appraisal and if he doesn’t think he can get a property to appraise, he calls the agent before he even goes to the property.  As a proactive agent, I love another proactive person.  Within 24 hours, I got word that the appraisal came through at the purchase price.  Right now, we are on track to close this deal on the same time frame that we were on before switching lenders – which means that from loan application to closing will be 18 days!

Buyers and sellers do need to be aware that appraisal issues are out there right now in San Carlos and the other mid-peninsula markets.  Our market has changed fairly rapidly and with the appraisal rules that are in place, it is no surprise that this is occurring.  Appraisers have to have 2 sales within the last 90 days that are within a mile of the subject property.  If they cannot find anything within 1 mile they can go out to 2 or 3 miles.  The appraiser also needs to use 1 pending and 1 active.  This is important information for sellers to be aware of when pricing their home and looking at offers.  Although the highest offer looks the most attractive, you have to weigh whether or not the home can appraise for that price.  As a seller, you certainly don’t want your transaction to fall apart 7 to 10 days into the transaction since you will have lost a lot of momentum.

Got questions? Contact Val, the San Carlos data gal!

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The Not-So-Attractive World of San Carlos Foreclosures

Posted on 02 December 2009 by vvandervort

It strikes me that every person who walks in the door of my open houses these days in San Carlos wants to know about scoring a deal by buying a foreclosure property. 

First off, I hate calling them foreclosure properties.  To me that implies that they are about to be foreclosed upon.  That ugly process has already been done, so you pretty much always hear me referring to them as “bank owned” properties.

 Here’s my short list on why I hate dealing with San Carlos foreclosures. 

1.  They always seem to have sewer problems.  See, no one has been living in them for a while because the foreclosure process does take a while and when an owner is being foreclosed upon, they have no problem putting the toilet paper roll down the toilet in addition to the toilet paper itself.  Then, of course, the bank doesn’t pay for a sewer inspection, so the buyer gets stuck with the $150+ inspection fee.  And when you do find something, the bank hates to negotiate any further on the price.  If you have to walk on the deal, you’ve just lost your $150 plus all of the other inspections you’ve paid for, and probably your appraisal fee.

2.  There are no disclosures at all.  You don’t really know the value of the Transfer Disclosure Statement and the Supplemental Sellers’ Checklist until you don’t get them at all.  These two forms give you 12 pages of really useful information and history about the home.  Since the bank never lived in the house, they don’t know anything to disclose. 

3.  Surprises!  If you actually close the deal on a bank owned home and you move in, you are often hit with unforeseen items.  Imagine you’re out front socializing with your new neighbors and your neighbor tells you about the time some crazy lunatic broke into the home.

4.  95% of the time, they are listed by some out of the area agent who has no clue about the San Carlos real estate market, nor the norms of how we complete our real estate transactions around here.  It ends up making more work for the buyer’s agent.  On a deal I was in earlier this year, I had to supply the agent with vendors for getting quotes on the property because they had no clue who would be reputable around here.  On another deal, I guess the agent is too lazy to drive down from the city because his lock box is still at the property 60 days after we’ve closed escrow. 

Okay, for you folks who still think you’d like to buy a San Carlos foreclosure, the only one we have available is 1651 Alameda de las Pulgas listed at $519,900. 

You know, foreclosures could be worse… they could be short sales!  I’ll delve into that can of worms in a future post.

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Save Yourself From the Stink of a Bad Sewer Line!

Posted on 07 November 2009 by vvandervort

In Burlingame and Hillsborough, it is mandatory at the time that a property is put on the market to complete a “sewer lateral” inspection, but in other cities along the peninsula this is not a requirement.  After having a couple of bad experiences in San Carlos and Belmont, I have come to recommend this inexpensive and extremely informative inspection to my buyers on most properties.  Lately, it has been a key part of negotiations in transactions on properties that were foreclosed upon and are bank owned. 

A sewer lateral inspection involves the inspector finding the sewer line cleanout location, opening it up, and running a camera through it to discover the condition of the line.  If there is a clean out on the perimeter of the property, it costs $150.  If the inspector has to get the camera equipment into the crawl space to a clean out, then it is another $75.  A few weeks ago, I ran into an instance where the inspector had to go up on the roof to access the line and that too resulted in the additional $75 fee (this was a house that had a slab foundation).  Relative to a home inspection, which runs about $450 and a pest inspection at about $250, this is a cheap inspection.  Also, it can cost about $4000 to $7000 to replace a sewer line and I have had great success in getting sellers to pay for at least 50% of the repair of the line.  With homes of about 50 to 60 years of age in many locations in San Carlos, the sewer lines are definitely getting old and this inspection could save you thousands of dollars, not to mention having the ability to flush your toilet and see the stuff go away once you move in.  To me, that’s worth A LOT!

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