L.A. real estate news and insights.
On this episode, I answer the following four real estate questions:
1) What's going to happen in the real estate market for the rest of 2020?
2) What do mortgage interest rates look like for home buyers right now?
3) Has it been difficult to show homes during the pandemic?
4) What's the hardest real estate deal you ever had?
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It wasn't this extreme before the pandemic, but I am seeing about 40% of all homes on the market now require a buyers loan pre-approval letter just to get in to see the property.
With the Coronavirus still playing a roll in all of our lives, more and more sellers only want to grant access to serious buyers.
I anticipate this percentage to only go up from here.
The days of casually looking at homes on the market are over.
If you want to see ALL the homes on the market, have your pre-approval letter ready!
Your friend told you they are interested in selling their home sometime in 2020. You should let them know that they need to act sooner rather than later. Typically most real estate transactions take place in Springtime. Due to the Coronavirus and homeowners holding off on selling their homes, home sale transactions were down about 40% during the 2020 Spring selling season. Because of this home selling delay, the Spring selling season has essentially been pushed to Summer 2020. It's projected that the Los Angeles area will have an uptick in inventory and have a very strong buyer demand for the entire Summer season. I am recommending to your friend that they sell during this peak time and not wait until Fall or Winter.
The reason to not delay is that the flu season will start in Fall and many of us will get the common flu. Since the symptoms for the Coronavirus and the flu are similar, I am anticipating that during this time daily news reports will say that a second wave of the Coronavirus is coming. This news will make sellers rethink their plans of putting their home on the market. Because of this, I expect the market to see a repeat of what happened when the stay-at-home order was put in place back in late March. If you are not aware, during that time real estate escrows were being canceled left and right. Sellers were offering buyers $10K, $20K, $30k in credits just to stay in escrow. Some buyers took the deal, most did not. Compound that with home sales traditionally being slow in the 4th quarter due to the holidays, and you essentially have a standstill in the real estate market. That's why I am confident that this Summer will be the best time for your friend to see multiple offers on their home and to sell for top dollar.
When your friend is ready to sell their home, I can help them with the sale. Text their name and number to 818-445-7953, and I'll take care of the rest.
Thank you for all your referrals so far this year! I truly appreciate you helping my business thrive during a pandemic.
Under current California law, after there is a change in ownership of a home, the property is reassessed.
The supplemental bill is paid by the buyer of the home and covers the difference between the previously assessed value taxes and the newly assessed value when you purchased the home.
Think of it as a catch-up bill.
For example, the home you just purchased was last sold back in 1970 for $50K, you now bought that home for $750K.
The supplemental tax bill covers the difference between the $50K and $750K.
The tax in this example is going to be around $5,000.
You may see the supplemental bill within a few months of buying your home.
You may also receive a supplemental tax bill for changes that add property value, like adding square footage or special features like a swimming pool or fireplace.
The 4th quarter of the year (October, November, December) is usually when home sales are the slowest.
The reason is that everyone is busy with the holidays that come up during those months.
A buyer may put their home search on hold because they are having their family stay at their home for #Thanksgiving.
Or maybe it's more important to a home buyer to go to all the holiday parties instead of focusing on finding a home.
No matter what the reason is, the 4th quarter is typically the slowest time of the year in real estate.
Having said that, the real motivated buyers and sellers are still out there trying to make a deal happen.
Some of the best deals I have seen have gone down during the holiday season.
If you are a buyer, the best strategy is to close escrow on any day Tuesday - Friday.
For example, have the lender fund your mortgage loan on Monday, close on Tuesday.
Or have the loan fund on Thursday, close on Friday.
Avoid having the lender fund on Friday, pay interest on the loan over the weekend, then close escrow on Monday.
There is no point to pay interest over the weekend on a home you technically don't own yet!
You usually don't close escrow the same day your lender funds your mortgage loan.
Normally the lender funds the loan, then you close escrow the next day.
Also, keep in mind you can't close escrow over the weekend, the county recorder office is closed.
Therefore, if you are scheduled to close escrow on a Monday, the lender must fund the loan the Friday before.
This should be avoided if possible. Why?
Because once the loan is funded, you start to pay interest on that loan.
It's not the best idea to pay interest on a home you technically do not own yet (it's not your home until you close escrow on Monday).
The best thing to do would be to wait and have the lender fund the loan on Monday, then close escrow on Tuesday.
That way you are not wasting money and putting more money into your lender's pockets.
Your friend told you they were thinking of selling their home.
What do I have to do for you to refer me to that friend?
Text me at 818-445-7953.
Thank you!
I just saw on the news that a home buyer was scammed out of her entire deposit amount.
She received fake wiring instructions and had thought the instructions came directly from the escrow company.
She wired her deposit money over to the account on the fake instructions.
The thieves took the money and were never heard from again.
The buyer is now out the money she wired over and no longer has enough money to purchase a home.
She has to wait and save up more cash.
This is a terrible story and I am warning you now to always confirm that the wiring instructions are real.
This is very easy to do!
Once you get the wiring instructions emailed to you, call the escrow company and confirm over the phone that the account number that you are wiring to is in fact their real account.
Once confirmed, then you are safe to send the money.
When you buy a home, you have to put down a deposit.
Typically that deposit amount is 3% of the purchase price of the home.
Keep in mind that this 3% amount is not set in stone, but it is customary.
You can put any amount you want, however the seller will not think you are a serious buyer and probably won't accept your offer unless you put at least 3% for your deposit amount.
You have to send your deposit over to the escrow company to hold within 3 days of getting your offer accepted.
