The Santa Clarita home buyers have been given a gift of sorts. They have additional inventory that has entered the market in a steady stream since mid-July of 2018. As of the closing out of Q3 2018, the Santa Clarita Valley has an additional 300+ homes for sale.
This brings us to our Santa Clarita CA ending Quarter three totals: 710 active real estate listings currently on the Santa Clarita real estate market for sale. This includes the Single Family Homes, The attached single-family homes, the condominiums, and the town-homes.
If you look at the additional homes that are in process and that have sold in the past 90 days, you will be able to get a complete picture of the local Santa Clarita housing market, as you should have before making any real estate decisions.
A couple of other factors that I will mention in detail as I build out this Santa Clarita home buyer article is the current way that financing is happening within the SCV market. What types are buyers using primarily and what types are most effective if they are competing for a listing that is in high demand with multiple offers.
Finally, I will talk about the love letters that we have our template for and how you can use them to your advantage as a home buyer in the current market. Even though homes and real estate listings are selling at a slower pace, in most cases the home sellers do appreciate you appreciating the home you are writing an offer for, in more ways than just the offer.
Home Buyer housing market factors
To know the current housing market is to know the numbers of real estate listings, the types of financing that are most accepted, and what it takes to get an offer accepted on a home a home buyer wants to buy.
The numbers as they relate to the current home buyers in the real estate market in the Santa Clarita Valley cities.
- Active Listings - 710 active - tracking back to June/July 2018 we had less than 400 active listings for sale. This increase has slowed down the Santa Clarita real estate market.
- Pending Listings - those listings which are in escrow, under contract. 386 real estate listings fit this criterion currently in the Santa Clarita Valley cities as of 10.18.2018.
- Sold Listings - the last 90 days of sold inventory, how does that break down and what financing types were ultimately used with those sales. This data will give a home buyer a good indication of how competitive the housing market is and how they are going to measure up when making an offer on a home that they want to buy.
- 913 real estate listings sold in the Santa Clarita Valley within the last 90 days
- These were compromised of Single Family Homes, Condos, Townhomes, land, and 1 to 4 unit multi-family residences.
- 48 of the residences sold were financed using Veterans Administration, VA Financing
- 124 used Federal Housing Administration, FHA financing
- 78 homes that sold were bought with cash
- 584 homes that sold used conventional financing - various percentages down
- Cash to Loan - 30
- Cash to New Loan - 68
- 3 - other types of financing
- Owner carrying financing - 0
These are important to know and there is a further breakdown that I do for our Santa Clarita home buyers that will include Condo and townhome separation and that of attached and detached single-family homes. Mostly the financing is the difference between the different types of housing that are available in the Santa Clarita Valley cities. However, we do have some townhomes and condos that are just as expensive as Single-Family Homes in some of the various locations within the SCV cities.
Let me get something out of the way, SCV - that stands for Santa Clarita Valley. The Santa Clarita Valley is composed of 8 cities. Most consider Acton and Agua Dulce not to be a part because they are more rural than the urban cityscape that the other Santa Clarita Valley cities offer - but I include them with Castaic, Canyon Country, Saugus, Newhall, Valencia and Stevenson Ranch. These are the cities that I research if the home buyer is looking for the urban living. I focus on Acton and Agua Dulce is the home buyer is looking more for a rural experience.
Due to the extra increase in real estate inventory available, some home buyers think that they have all the time to wait in the world. That is not necessarily the case with every single listing that will enter the market. Some have that "pizzazz" - those listed are the ones that have been in heightened demand, but have been lacking as being available for sale.
When a home like that hits the market for sale, the offers need to be quick, best and highest in nature. They need to include all of the elements a good offer has. The need to be attended to and have all the attachments that are necessary to prove that the buyer has it together, financially and has given a lot of constructive thought to the buying of the seller's home.
Days on Market - A Home buyers resource
Having mentioned the "pizzazz" factor, let me explain some of the DOM, or Days on Market factors that you will want to consider when starting to view real estate in the Santa Clarita Valley as a home buyer.
Days on market defines how long a home has been for sale. There is also another factor called CDOM, or Culimnative days on market. This is the "overall" time without a 90-day break between the listing time and off-market time.
For example. You could have a home for sale in the Santa Clarita Valley cities that reveals a time of market of 10 days. 10 DOM. Then after that figure when I give you the research documents related to comparable listings, you see that that same home has a figure of 70 CDOM. That means that this home was listed for sale 70 days in total. 60 days before and 10 days currently, 70 total days listed for sale. The only way to break the CDOM figure is to have a home off of the market officially for more than 90 days. After that time when the home is relisted because it was unable to sell before, it enters the market with a 0 DOM and a 0 CDOM time indicated.
If a home is seen with a long CDOM, to some buyers it indicates there are issues with the home. We also show our buyers, with the longer days on market time frames, the particular home history of possibly entering escrow, re-entering the for sale market in the active status, canceling, etc.. Whatever the occurrence, they are recorded and presented to the home buyer so we can conclude the best positioning strategy for said home buyer.
The longer than typical Days on market may simply indicate an overpriced listing. The fact a home falls out of escrow may have nothing to do with something the home buyer discovered. It may be a simple issue of the buyer unable to keep their qualification because they lost their job.
However, sometimes it pays to look at the homes that have been on the market longer than what is typical. Viewing those homes specifically with the comps may indicate a better than average deal on that particular home. Maybe it can be worked out that said home can be bought below the last sold comparable.
There are many ways to get an advantage to a home buyer. It takes knowledge and experience in order to have it presented properly.
What is told is not always the truth
When we get calls on our seller's real estate listings, some will say that they are sending an offer. The biggest rookie mistake would be me calling the home seller and letting them know that I have an offer coming in. The verbal indication is not anything that is in concrete. You'd be surprised how many times that I have received text messages and phone calls such as these. Where agents are calling saying that their home buyers are writing an offer right now and it'll be over in a short while.
This is something that only us seasoned real estate agents know because of our experience with sellers, other agents, and their phone calls.
Sometimes when representing a home buyer I will speak with the seller's agent, which is always necessary before me showing their listing. The seller's agent will inform me that they have an offer. They have one in hand and are going to be presenting it to the home seller in X amount of hours or days. They are doing this because they have also heard of other offer's being submitted. That is the reason they are tarrying on the presentation of the current "in hand" offer.
More often than not, this is a tactic. Something that is used to get my home buyer more motivated. I always tell my Santa Clarita real estate buyers to take this information as a grain of salt. Bottom line is that if they are meant to the owners of this home, then that cannot be undone. If they are not, if their offer does not get accepted or if they are unable to move fast enough, and they lose the home, then it was not meant to be. All a home buyer can do is their best and nothing more.
So many agents get caught in what they were told by the other agent, it's ridiculous. Agents should know better than to believe something that another agent says. The information conveyed has to be vetted and compared/contrasted versus the real estate buyer's agents current and past experiences. If said buyer's agent does not have much in the way of experience, hopefully, they are working for another agent who they can confide in and get their experiences conveyed to pass along to their real estate buyers.
The multiple offers received banter is that just, it's banter. It could be that some listings that are priced under fair market value in a hot real estate market have received multiple offers, I do vet those and relay my opinion related to the information that the listing agent conveyed to me. I explain to my home buyers, in that scenario, what my thoughts are and if I believe what I was told, how to construct our offer.
The only thing that we want in a multiple offer scenario is to be countered. I want the time frame to increase and for the home seller to counter us as one of the offers that they received. That is why I'm so poignant on how I write my offers, what bullet points I present and how I deal with the listing agent on text, via email and on the phone.
At the end of the day, there is no showing of proof related to the story about offering's received, about rumors of offers or those which have been countered. It could all be pillow talk or it could be true or half true. My job is to protect my clients and to instill in them that them buying a home and real estate should be business and never emotional.
I love your home letters
Some of the best strategic approaches to real estate and homes in a seller's market, and most markets for that matter, surround a concept that I like to call the "love letter". This is something that a home buyer should be thinking about to be offered with the offer they are having me scribe for them.
The Love Letter is the place where a home buyer can escape Legal-Eze and present themselves and human beings. Human beings that want to find some commonality with the home seller and to impress upon the home seller to accept their offer on their home for sale.
One of the items that I always tell my home buyers is to always approach the seller from a transparent point of view. They want to buy the seller's home. They have made their best offer and they now want to have a letter accompany their offer that the seller will have to read in order to proceed with my home buyers offer.
They "have to" because I have included the love letter in the offer, within the print stating what the home seller shall do. This is powerful stuff and really coveys to the home sellers that my Santa Clarita real estate buyers are very serious and want to buy their home.
I have seen the love letters my clients have written supersede even profit when it came down to multiple offers.
Some home sellers look at the people buying the home and because they have loved it, they want the home buyers to love the home as much as they have.
I'm not a judge, I'm only the agent representing those wanting to buy and or sell real estate. I want my best foot forward to and educate my Santa Clarita home buyers so there are no guesses nor mistakes made in the offering process.
Of course, it could be that when all i's are dotted and all t's are crossed, the best and most perfect real estate strategy placed would have the offer go to someone else that the seller wanted more than you as the home buyer.
It happens and I have always said to my home buyers that in that circumstance, it was not meant to be. The home they wanted to buy was not meant to be. This way we ascribe to something of a higher power. As do I. Things happen for a reason and there is no reason to beat up oneself about not getting what was wanted.
If I got everything that I wanted, it could create issues in my life. I work hard, I don't rest much, but at the end of the day, I need to accept the things that I cannot change. My home buyers are best suited to be on the same page, it's a much easier existence.
I'm Connor MacIvor, with REMAX SCVnest.com. I have been representing home buyers in the Santa Clarita cities and within the Greater Los Angeles Communities since 1998. I'll be here for you when you are ready for my representation.