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I’ve been working with a really great couple recently on the purchase of their first home and am really excited to announce that the home they liked has been approved for a short sale. We’ve all (the lender, the buyers, me and the seller’s agent) been waiting with bated breath for about a month now. No, I’m not kidding. The date on the contract says July 11th.
I met this couple while showing my listing on 7710 25th Avenue - which is still in the approval process for a short sale - and liked them instantly. For first-time buyers, they already know a lot about investing for the future, have experience maintaining property and are not afraid of the work owning a rental property involves. With the purchase of this home, which will be their primary, they will also be jumping into managing a rental for their relatives.
I see a bright future for them if they stick with it. And something tells me they will. Stay tuned!
Thanks and congratulations to Susan S., a good friend of mine from back in my software days . Susan closed escrow this week on a fabulous home in East Sacramento, one which was offered at approximately 13% off of comparable sales value.
Susan was fortunate inasmuch as when we previewed it, it was actually pending sale with another buyer. However this buyer — who was a first time buyer — had a concern because of some slight irregularities in the carpeting, so they cancelled their transaction. The irregularities were no big deal to Susan even if they’d been let stand — and it turned out they were corrected in escrow in any case.
Susan is shown here having a good time at her new home with several of her friends (some of whom helped informally with her inspections, though she was very dilligent with her formal inspections as well) and her dog, Sage.
Just trying to get a head count here before I go ahead and set a date, so do let me know at purvabrown@msn.com right away.
If you’re buying your first property with an eye toward investing in the future or are actively investing into rentals, this seminar can save you thousands of dollars in tax payments when you sell. Yes, yes, it’s perfectly legal. Section 1031 in the Internal Revenue Code allows you to defer all of your capital gain taxes to the IRS (15%) and the Franchise Tax Board of California (9.3%) if you buy another property of equal or greater value.
But you must know what you’re doing. And you must use a qualified intermediary.
So attend the seminar and empower yourself.
Now that we’re settled in this lovely country home we just bought, my husband and I decided to go out and explore. Pollock Pines is quite a pretty little town and definitely worth a stop if you’re heading up to Tahoe for the weekend. Because it’s not too far from Sacramento, people live here (like us!) and commute to Sacramento (again, like us!)
It’s okay - it’s just 5,000 or so of us residents.
Last week, we went to The Bowling Alley. (Yes, we go to The Grocery Store, The Post Office and The Bowling Alley.) And it was a lot of fun. On Saturday nights, they have black light bowling. There are also approximately seven pool tables as well and a bar.
I tried my hand at it (pun intended) and came away realizing thirteen pounds is heavier than it seems. (I need my own bowling ball.)
The best part about all this - it’s not crowded. You are not shoving for space. So if you’re in Pollock Pines for the night, stop by. There’s a lot of friendly people here. And quite a few homes for sale, might I add!
I’m still trying to find the answer to this one. In the last post of Sacramento real estate statistics it was pretty clear that Sacramento had about a ten month inventory of unsold homes. Of those, about a third were bank owned houses or short sales.
Consumers usually believe these are better deals than the regular homes in any particular neighborhood. (Why I’m still trying to understand!)And so, there are a lot more buyers for short sales priced the same as a “normal” or individually owned house.
But that being said, not all short sales are going through. Just last week, I canceled my own listing in Colonial Village although it was priced well because the lender would not respond to the offer which was “too low” according to their appraisal. Problem with the appraisal: too high.
So between the offers being too low and the lender’s appraisals being too high, a lot of homes that are technically short sales are not going through. Which means they will either be auctioned or be back on the market as bank owned properties. Unfortunately because they will be left vacant for long lengths of time, they may have issues with deferred maintenance and / or vandalism.
However, it is important to note: if you made an offer on a house and it didn’t go through during the short sale phase, you might be able to revisit it and make the same offer after it is a bank owned property (if it didn’t sell in auction). The earlier rejection may have been because the seller didn’t qualify for a short sale and have nothing to do with your offer.
Something to think about.
I met some wonderful people today while showing a property in Auburn. It is a country home across from a golf course on an acre… oh, and it gets better - is for sale under $300,000. While it is not Elite Properties’ listing, the potential buyers appreciated knowing that they could ask pointed questions about the house without hurting anyone’s feelings.
Which makes me think about the new club of buyers I’ve been running into lately. This market sure has created a new surge of investors and as well as first-time buyers. I guess every new market downturn brings with it its own club of new investors. What I’m seeing is the new buyers are not as scared of a market turnaround. They’re in it for the long haul. Even the first-time buyers today have an eye to retiring with their real estate intact. They understand the value of a home and are aware of the advantages of rental properties.
Like the clients I met today said, “Owning real estate in California is like owning gold. Why would you EVER sell?”
Well said! I thought. My thoughts exactly.
After writing about short sales making up a major chunk of the Sacramento real estate market and what they are, the next question that follows of course is if short sales are a good deal for the buyer.
The answer is, it depends.
It depends on a lot of things, the most important being of course - will it even go through? I had the unfortunate experience yesterday of having to withdraw one of my listings because the home had two mortgages on it and the first lender could go into auction and sell the home to recover all of their principal. The second note however might not get anything. In other words, the first lender had no motivation to sell short and the second lender was getting nothing anyway.
The other thing the answer to the above question depends on is of course, what are the comps? How much are the comparable properties in the neighborhood selling for? The seller of the short sale may have paid exorbitantly more and the place might not even be worth a look unless it really is a good price for the buyers.
Thirdly, and probably the most importantly, what condition is the home in? Chances are, if the sellers haven’t been able to pay the mortgage, they haven’t been able to make any repairs to the home. How many of these repairs are serious?
If it were me, I would look elsewhere. There are many properties on the market that are not short sales that are still good deals. To look for short sales in particular seems to me a huge undertaking of patience for not a very high return. But if you are determined, they sure are out there!
See for yourself. Here are the latest statistics hot off the MLS:
Total number of homes for sale on or before July 31, 2007: 11,016 with a median price of $329,960
Total number of homes pending sale between July 1, 2007 and July 31, 2007: 1038 with a median price of $315,000
Total number of homes sold between July 1, 2007 and July 31, 2007: 928 with a median price of $330,000.
The median price is up only $2,000 from last month and sales have fallen since June 2007. In June, Sacramento county recorded 1068 sales.
Average days on market remain between 50 - 60 days.
Lots to look at and flat prices. Good time to buy!
And you thought anything more than $200,000 was too much to pay!
I just read about this house in the Sacramento Bee this morning and I must say - WOW! The virtual tour is worth taking a look at, if just to see opulence translated into real estate.
The Tuscan Villa is considered one of the most expensive listings ever to hit the Sacramento real estate market with 10 bedrooms, 10 baths and a total of 15,000 square feet of living space. My personal favorites are the “Great Room” and the gourmet kitchen. (Any home that has anything called “a great room,” I want to buy.)
It’s beautiful. Just beautiful.
Anyone with approximately $9,000,000 to spare on a house? Call me to see it!
These neighborhood came up during a preliminary search on the MLS for investment properties, that is, places that someone might want to rent out. The best homes for renting obviously are those that have at least 3 bedrooms, but having said that I own a 2 bedroom that has been doing quite well.
If I were an investor looking for something to buy at a great price that would rent well with about 20% down, I would be looking at the following (There are other neighborhoods as well, these just have higher inventories):
95864 (Arden area)
95841 (Just off I-80 and Madison)
95621 (Citrus Heights, always a favorite amongst landlords)
95758 (Elk Grove around Laguna)
I will post more as I see them, but if you are going shopping soon, I would focus on these places. There are some good deals here, especially the bank-owned properties.
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