The Law of Mass Thinking

If you look at the inventory levels today, they have more than tripled from the beginning of the year. If you remember, the number of homes available for sale in Fremont were about 80-90 homes and now they have gone up over 250 homes in the Fremont market. Other cities are not an exception either. At the same time, prices have homes have climbed up too.

In many cities where median price of the home was between 700-800 thousand in January, those homes were selling around $150-200K higher by June. Majority of the Buyers are on the sidelines and sellers are putting the homes on the market with record numbers. I call this a Law of Mass Thinking.

Here’s how real estate gets SOLD, Greater Exposure Through Effective marketing leads to Greater Demand, and Greater Demand leads to Higher Price. This is how I work and the method I use for creating Greater Demand, are based on my years of marketing experience.

Real Estate Market – Will it rise?

The Bay Area market is seen to go up last year, as fast paced until June. The Markets took a breather in July-September time frame, however, an increased bidding activity was seen in the market. We had some low down payment buyers take advantage of the slow markets and now again the competition is heating up, thanks to the low interest rates and the fear of the rising interest rates.

However with over 70% chance as per the experts on the rate hike, the mortgage rates have started climbing in anticipation. This means two things for most home buyers and sellers alike: Buyers should buy now, before the rate hike and higher rates set in. Seller’s should sell now to take advantage of the buyer demand due to lower interest rates. When the rates go higher, the buyer qualification is going to DROP and Seller’s will have less offers and may not be as high as expected.

What makes the home market affordable, is the combination of home prices and the interest rates. As long as you can afford, its always a good time to buy.

What drives home ownership?

Why is it important to have ONE knowledgeable person handle your real estate buying, selling and financing in the Bay Area? Here are 10 things that drive up the cost of home ownership. These 10 things are not just mortgage or real estate related, they are related to both. You can’t buy without a mortgage and you can’t get a mortgage unless you have a property. Cash buyers are a complete different ball game. So let’s focus on the home owners buying or selling with the mortgage loan. The top 10 things that drive the cost of home ownership are:
1. Inspection Contingency 2. Loan Contingency 3. Appraisal Contingency 4. Repair Negotiations 5. Your Credit Score 6. Your Down payment 7. Occupancy of the property 8. Size of the loan 9. Time frame delays 10. Hiring the Right Agent.

In order to save money, every aspect of the real estate transaction requires investigation. Let it be getting the loan, performing inspections, buying property as-is, addressing the proper contingencies or closing on time. Every step has cost associated with it and and at the end it may translate into higher or lower cost of home ownership for the home owners. Of course one of the major factors is hiring the right agent to help you make informed and timely decisions.

Multiple Offers. Sellers Dream.

Some homes were getting multiple offers and others are staying in the market. So the question is how does seller attract multiple offers on the home? Are you getting right advice to increase the value of the home in any market? Is the agent you are using full of ideas when roadblocks appear? Are you using agent who is reactive or using one who is proactive? How does your agents negotiations skills stack up? Many times, negotiations skills alone pay for agents commissions. It feels good when you get multiple offers and buyers bid higher than the home may be actually worth. However, key to getting multiple offers is to price the home lower than the price the house condition demands. And if you have gotten right advice in preparing your home for sale, your home may look better than the homes sold in the neighborhood at attractive price point.

Selling a Home is a skill. It requires vision to look beyond how the home looks today and how it should look before it goes for sale. Selling a home, also creates liabilities on seller’s part as the buyer is paying hefty price for the home, seller has lot of obligations and legal/statutory duties to disclose. I have expertise in Product Marketing and Home is a product we, meaning the Home Owner and I, need to sell together. Seller’s need guidance in terms of Preparing the home for sale, What Upgrades can be made, How to completed legally required disclosures to avoid future liability, How to Price the home, how to select right buyer for the property, how to monitor the sales transaction through closing? How to negotiate repairs?, and a lot more.

Inventory is High, It’s time to buy.

This episode focuses on Home Buyers who take their own time in this fast moving market and miss out on the opportunities to owning a home. Buyer objections, or fears that lead to not making a decision to buy a home. Rather than telling you the home buying process, I am going to peek into buyer’s mind. Whether you have purchased a home or in the evaluation process or in the process of purchasing and are in the contract, you can relate to the buyer experiences, fears and excitements.. Value of the right advice, timely advice and developing comfort in buying a home in any market goes long ways in saving money, saving time and having peace of mind that you made the right decision.

Sellers have come out in the market increasing the inventory of available homes further. Sometimes buyers say the inventory is low, we cannot buy a home, and now same buyers are saying inventory is high, market is slowing down, and they will wait. As time passes, the reasoning maybe different, interest rates have gone up, I cannot afford to buy or even something else. My advice, inventory levels are high, its time to buy. Negotiate well, and move into your own home, today!

Live Happily Ever After

It is very fulfilling to see happy clients in their dream homes. My whole approach is built on educating my clients. Whether they want to buy, sell or get financing, I like to understand their situation and based on my years of experience, guide them through the often confusing real estate markets. I am personally a big proponent of knowledge and I take many new certifications regularly to help my clients further.

Follow the formula READY-SET-HOME! Get ready for the Markets by getting educated, Finalize your neighborhood selection and loan pre-approval with FREE one-on-one consultation with ME. That is when you are all SET to select your home within 3 to 5 weeks. Typically, about 40% of the home buyers are the first time home buyers. I enjoy helping the first time buyers. Experience shows that the first time home buyers are often searching for the advice that meets their family needs. There are hundreds of neighborhoods around the bay area. Many school districts, amenities, different home types, sizes, prices and walk scores that need to be consolidated to fit the needs of given individual or a family. By knowing the client needs and wants, I have been successfully recommending the right neighborhoods that are within the budget, affordable and where my clients are going to find happiness. The house they are going to buy is going to become their home.

Get past those Red Flags

What are some of the RED FLAGS that may stop you from buying the home you want in the Bay Area? It has become a norm that property comes on the market, seller completes all disclosures and reports. Buyer reviews the reports, many times not knowing what they are reading or what it meant to them from home ownership standpoint. Offers are submitted to purchase the property AS-IS and in its present condition. One of the buyers wins the bid and depending on the level of risk the buyer took, he may or may not be happy with the purchase. Seller, if not letting the buyer know everything they know are taking risk of later law suits if any material facts were hidden from the buyers.

First Red Flag is Requirement of the FURTHER INSPECTIONS. Further Inspections may be required due to multiple reasons. Most of the time it is due to inaccessibility of the area to be inspected. They may include, situations where seller has put a lot of stuff in the garage and inspector can not walk around free to inspect the garage. It may be related to the way the foundation is built and inspector cannot go around the structure to inspect the other side of foundation for foundation issues as well as issues related to pest control. Many times the attic area cannot be inspected because inspectors cannot crawl or walk inside the attic unless some ceiling wooden planks make it easier to get around.

The next red flag for me is the various pests like termites, rodents. They can be either dry wood termites or sub-terrainian termites. The home you love is also loved by these creatures and you may have a company when you move in. Treatments for the dry wood termites and sub-terraininan termites are different and vary widely. Several other Red Flags exist during the real estate transaction process, listen on to know what they are.

Contingencies=Protection

A contingency is a future event or circumstance that is possible but cannot be predicted with certainty. I look at contingency as a condition in a real estate contract. Typically when you buy goods from a store, you get 30 day money back guaranty. It is difficult to return a house. Therefore when you get into a contract, you can investigate the home condition during your contingency period. This allows you to evaluate the home condition and allows you to make sure it fits all your needs and wants. Many sellers will do up front inspections and seller reports so that buyer can be given comfort level about the property condition or a discomfort on the involved costs when they move into the home. Its all about knowing what you are getting into.

To understand impact of contingencies, it is necessary to know that when you make an offer on the home, you typically deposit 3% of the home price as deposit towards the home purchase. Protecting your deposit is important and contingencies protect your deposit as well as a wrong purchase from future unforeseen events. Typically contingencies buyer may have are – Loan Contingency, Appraisal contingency, Inspection Contingency, Seller disclosure contingency, Other disclosure contingency, title report contingency, or sale of your current resident that must happen to buy a new home – contingency. One can put any contingency they want, as long as other party can accept that. Even sellers have contingencies – like finding a new home contingency. To know more about the importance of contingencies, listen to this episode.

Credit Scores & Home Loans

Credit scores play an important role in the home loan process. I have discussion with borrowers and home buyers at least couple times a day about how they already know their credit score from these FREE credit reporting website. I know some of the credit cards offer this service and also some bay area companies have this service for their employees as the benefits. However, MAIN thing to notice is that the credit scores for mortgage activity are different than those from these FREE credit agencies. That is the important point everyone MUST remember.

First thing to do is have a mortgage professional, like me, analyze your financial situation. Once I have all the documentation, I will analyze credit, debts, income and assets to understand true mortgage qualification. As you know credit scores range from 350 all the way to 850. There are Three credit bureaus – Equifax, Transunion and Experian. The Mortgage credit report run using all 3 bureaus is called a TRI-MERGE credit report. All bureau scores are not identical. So lenders ignore the high and the low scores and consider only middle score. This middle score is used for determining the mortgage rate. Listen on and learn more about Credit Scores and Home Loans.

How we get you your dream house

Many first time home buyers have common questions before buying a home in the Bay Area, like what to buy, where to buy, when to buy, how much can they afford, how is the market, will the market fall after their purchase and so on. However, there are even additional questions, like how does the home buying process work in California? With homes and neighborhoods being OLD, what do you look for? What are real estate contracts? What does, Active, PENDING, SOLD mean, the school districts and how do you negotiate a deal to become a happy home owner.

Here’s where I come in. Its all about helping you during all stages of your home ownership. That is before you buy, during your Ownership and As you decide to sell. For me its not exclusively about business. Its about valued interactions with my clients, who become friends after the transactions.

Real Estate and Home Loans are so tied together they are like the two sides of the same coin. So before home ownership, the First thing to do is , analyze your financial situation by analyzing all the documents needed for loan qualification. I will analyze client’s credit, debts, income and assets to understand his true mortgage qualification. This puts the boundaries on how much home you can afford. Also, depending on the loan program and also type of home, the home loan qualification varies. Once I have determined the boundaries, we finally move onto neighborhood selection. Listen on to know more about this process.