Latest Real Estate Update and Newsletter for September:
The real estate market continues to ebb and flow from being one with lacking real estate inventory to the latest numbers showing that there has been a 30% increase in new Santa Clarita real estate listings that are currently for sale from February 2018.
The Santa Clarita Bold seller's market is starting it's shift to a weak buyer's market. When we have more inventory than we have currently, you will see this market flip onto its head and become a full-blown home buyers real estate market.
We aren't going to see massive price reductions, or very many price reductions for that matter. This is because of the continuing home buyer drive and our return to a "normal" real estate market. Once we arrive the "hours on market" will change to multiple days and weeks on the market time frames. This is unusual but is the historical norm for the Santa Clarita real estate market.
Previous Santa Clarita real estate market update:
As dad used to say, probably from somewhere else, there are old pilots, and there are bold pilots, but there are very few old/bold pilots.
I did not understand then, but I do understand now. I will relay to you that we have entered the same sort of real estate market in the Santa Clarita Valley cities, where sellers are bold. Maybe not too many "old" ones - but Bold seems to be the turn-off point for home buyers.
I explain to both our sellers and home buyers that "bold" can be an issue. I say to remain "business only". Don't let any emotional baggage enter into the sale/purchase of real estate. As long as both parties are playing by that same rule, on the same gridiron, this advice works well.
Unfortunately, even the agents have "emotional" ties to the representation of their clients. Having learned the lesson, I do not get involved in that way. I want the best for my home sellers and home buyers. If I break into an emotional frenzy, people start getting the wrong kind of advice.
As an example. When a home seller responds to a buyer's request for repairs stating they are not going to pay the $80.00 to have the water heater strapped per code, and when that home buyer gave the seller the amount of money they wanted for their home, and after we have been in escrow for 30 days, my advice would be to give the money, it is a required retrofit item.
Sometimes, a seller will respond with the home was being sold "as is". I remind them that we discussed this. All real estate is sold "as is". I even write on the contract that no items will be repaired nor credits will be granted. However, a home buyer can still ask and the home seller can do what they desire. To get upset, that is the wrong course of action.
While my advice would be to pay the $80.00, I explain to the seller they are still in charge. There are a few ways this could pan out if the home seller does not want to give the home buyer $80.00 to take care of the Water Heater Strapping.
The home buyer could cancel escrow and move along. (most likely this would be an emotional reaction)
The home buyer could continue with escrow and close the transaction.
The home buyer could respond in writing and ask the seller to meet them elsewhere regarding the $80.00. Maybe asking for 1/2, etc.
There is a difference between a buyer asking for the "exact amount" on an item or items which are health and safety issues. Bad Wiring, no carbon monoxide, no smoke detectors, a clogged drain, backed up sink, leaky roof, etc.. - But for a home buyer to use the Request for Repairs to reduce the price of the home beyond the estimate for repairs, that is emotional in another way :)
No home is perfect. All homes have issues. Some homes have minor cracks in the concrete all the way to asbestos present in the insulation and ceiling coupled with mold. We always explain to our home buyers to only offer what they are going to want to pay for the home. When asking for repairs, ask for the amounts reflecting what the home inspector or other inspectors have quoted. If that is not possible because the inspector won't give an estimate on what it will cost to fix. The home buyer can get the same estimate by a contractor and have them prepare a written estimate.
Most of the home inspectors we work with will be more than happy to give a written estimate for the repairs to be completed. Most are contractors and do that type of work. Not with the homes, they inspect, but other's that are out of the home inspection purview. Having a home inspector complete the work on a home they inspected, that is not proper on most fronts. Ask your real estate professional what they think and ensure there are no rules being broken if that is what you choose to have done.
Housing Radio show transcription
*computer completed transcription - as you can view by the errors in the transcription process.
Speaker 1: 00:00 Good everybody. Connor macgyver. Welcome to the longest running real estate radio show, housing radio.com. We have a podcast syndicated on iTunes and Stitcher radio and welcome to today's update. We are back at another Monday. We're the fifth of February, 2018 and really glad you could make it 10. We're going to get into where the market is currently and where we foresee it going here in the next couple of months just to give you a gauge as to what you might do if you're considering any kind of moving real estate. For some of you out there, it's going to potentially start to get a little expensive to purchase real estate. If what holds true with the Fed meeting couple more times this year and then pretty much set on raising interest rates. I've heard a couple of sources with regard to that. Something to watch out for and remember just to give you a gauge without you having to reach out to anyone.
Speaker 1: 00:53, Of course, you can always reach out to your lender if you have somebody you're working with. If you don't have a lender, you can reach out to me, I'll introduce you to one, but somebody who's purchasing a $500,000 residents, for example, let's say that's what your financing typically, just to give you a gauge for every half a percent change in interest rate, that's going to cut you about 50 grand. So if you weren't qualified at the previous interest rates at 500,000, it goes up half a point five percent. That's typically gonna cut India about $50,000, so the residential will be able to qualify for would be 450,000. That's how that works. And in addition, back in the day, the law really wasn't looked at all that carefully. Now it is, so the property has Bella Roos, special assessments, and also a trauma. It can be quite a bit as far as your buying power.
Speaker 1: 01:53 That's something to speak with the people you're working within real estate and find out this year it seems like we're going to be on target to have property prices continue to climb, all be at a very slow rate. It's not going to go up hand over fist like it has over the last few years since the bottom of the market in 2011 and 2012 at least. That was the Santa Clarita bottom. Looking at active real estate listings this week. Currently, as of this morning, 371 active real estate listings are on the market in the Santa Clarita Valley Cities Act and through Valencia, so that's going to be acting awkward. Will say we're gonna be covering casting. Can a country Newhall Saugus Stevenson ranch and also Valencia to give you a gauge three 71. Not much at all. That's keeping the ball well within the seller's end zone. It's definitely a seller's real estate market currently, and a switch [inaudible] over to a buyer.
Speaker 1: 02:55 We would probably have to quadruple that amount of listings that are currently active on the market for sale. Now, here's a little bit of a tip for you. If you are looking around and you're seeing some other websites, quote-unquote other websites saying that there are more listings currently active for sale in Santa Clarita Valley, they're lying to you. My system is pulling directly on the multiple listing services through the South Land Regional Association of Realtors and there is no more accurate system that is the controller and holder of the real estate data, so whatever happens to be currently listed for sale, it's going to be in there and through all the permissions, all the licensing and all the approvals that I've had to see over the years to display the data. SCVNest Dotcom has it. All right. All southern California cities. <Unk> one 76. I'm here in Santa Clarita Valley for looking at the in-process.
Speaker 1: 03:56 Those properties that are also an escrow. We got a couple hundred more that are in process. One of the things people always ask, well color know I don't see that house that I want out there yet. What we like to do is we'll look at the stuff that's in the process and then I'll make some phone calls. Finding out about these properties that fit the client's bill that happened to be currently in escrow. If there's a chance that they're not doing very well at. A big part of the equation is has the inspection been completed? Has the buyer asked or requested for items to be repaired or in lieu of a repair, some kind of a credit? It could be that they're right at that point and the buyer is getting a bad feeling from the seller and even though we tell our clients to not let your real estates do not let it become emotional, it's tough folks, tough.
Speaker 1: 04:58 So you have this emotional component. Person or persons. You have some seller stating that they're not going to be of assistance with items that maybe should've been taken care of prior to then putting their home on the market, whatever it may be, and it could be enough to upset the buyer to a point where you know what? We're going to go ahead and back out so now this property comes back on the market and you're willing to not take an emotionally and maybe that could be enough to make the seller nervous where they're going to have a different approach. When you request that creditor when you request that repair. A lot of moving parts in real estate, get a good advisor. If you don't have one diver as see the nest.com, please reach out to me. Let's talk about you sellers out there and people that are contemplating selling upsizing, downsizing, sideway sizing, whatever it may be.
Speaker 1: 06:00 One of the things to consider is where your interest rates are now and how much really you need to move. If it's going to be getting out of the state of California, which apparently truck rentals leaving the state. There's a huge increase tax on them because so many people are and I don't know if I see that from where I'm standing. I'm not seeing a lot of relocations out of the state, but that's what they're talking about. It also depends on what channel you happen to watch to see if everybody's coming to California, but he's leaving something else to be aware of. But if you are considering a move, if you have to lay out all the numbers and get a game plan and you also have to expect that the interest rate that you're going to be paying on a future piece of real estate is not going to be what you're currently financed for.
Speaker 1: 06:57 In fact, it's going to be more. Most of you sellers out there, people that have equity in and do are still carrying a mortgage on their home and this doesn't include if it's been paid off. These are for you folks that still have a mortgage and you're starting to pencil everything out. It could very well be that your interest rate is in the mid threes, ab even lower, maybe it's a 15-year loan and we shared a lot of those coming in through our office stores that are re Max and Senate. If that's, in fact, the case. You have a lot of thinking to do to see whether or not it's worth it. And that's going to be the hold up this year from getting a lot more than 371. The active units on the market for sale, that number is probably going to hover pretty close to that all the way through the springtime, summer and fall 2018 is going to be a very soft here for real estate unless the stock market takes a bigger hit than it already has.
Speaker 1: 07:59 Once that happens, if in fact, it does, then you're going to see a lot of people, much more interested in tangible assets than paper assets, tangible big thing so they can hold on to the gold, the silver, and of course real estate that happens. It could be another kickoff at another very strong market and real estate in [inaudible]. I'm Connor macgyver housing radio DOT com. Thanks for taking the time to listen to our real estate radio show. Again, I love to say the longest running here in Santa Clarita Valley. We started before it was a thing and we hope you tune in next time as a radio.com. I'm Connor Macabre. You know somebody that could utilize my real estate services, the buying or selling fields. Also, investigate within real estate. Send them my way. Everybody have a fantastic rest of your week and I hope it is phenomenal. Make good decisions to take care of each other, and if I can help you reach out my phone numbers all over the page at [inaudible] dot com care.
I'm Connor MacIvor - I'm here when you are ready at REMAX of Santa Clarita - REMAX of Valencia. I have been representing home buyers and home sellers since 1998.