Archive for the ‘san carlos real estate’ Category

Buyer Mentality vs. Lowball Reality

By Ed Gory | October 14th, 2010 1 Comment

Lowball offers rarely, if ever, get accepted.

There, I said it.

Almost everything you read in the news these days about the housing market points to it being a Buyer’s Market.  That is true to some extent, but not 100% of the time. There are neighborhoods out there that are exceptions to the rule, and often still get multiple offers (i.e. Palo Alto, Los Altos, parts of San Carlos & Redwood City).

But back to the notion of “lowball offers.” In my opinion, the success of a lowball offer is a bit of a myth.

From a SELLERS perspective

The current buyer mentality as a whole is fueled by what buyers read in the news, and the economic malaise in general. That mentality will not, I must repeat, will not change anytime soon.  So unless you’re selling a home in one of those rare “hot” neighborhoods, here’s the expectation you should have — buyers are going to come in and lowball you. Negotiating the best possible price is what I strive to do for my sellers every time (and I would think that nearly all listing agents have this fiduciary objective) — there’s no way I’d advise a seller to accept a lowball offer on the first round.  When buyers come into my listings and ask, “How low will they go?” my pat answer is, “Well, put something in writing and you’re sure to find out.”  Any good listing agent will not show their hand to how low their seller would go.

From a BUYER perspective

Now I’ll put my Buyer’s Agent hat on.

For a home that’s been on the market a LONG time (relatively speaking, of course), sure, the odds are that the home will sell for less than its asking price. How MUCH less really depends on the seller — since every seller’s situation is unique, I really don’t know “how low” they will go until I do a little further investigation with the sellers’ agent.  Even then, the sellers’ agent will rarely tell you exactly how low the sellers will go — that breaches his fiduciary duty to the sellers.  That agent’s duty is to get the home sold for the best possible price relative to all the other market conditions.

So, if you come in with a lowball offer (again, lowball being a relative term), the expectation you should ALWAYS have is that you’re going to get a counter-offer from the sellers.  Yes, sellers are “motivated,” but being motivated does NOT mean “desperate.”

Step 1: Make a lowball offer.   Step 2: Receive a counter offer from the seller.  It’s gonna happen, like it or not.

Look, here’s the reality: yes, buyers are generally in the driver’s seat these days, but, many sellers would rather wait it out, or take their home off the market before they accept a lowball offer.  Making a lowball offer, while it is a start to putting something in writing on the table, rarely meets with success.  Save your time and your efforts, and instead of getting your hopes up for getting “the deal of the century,” make a reasonable offer instead — the more fair/close-to-asking your offer price is, the less likely you are to get a counter-offer from the sellers.

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San Carlos’ Thorny Artificial Turf Issue

By Ed Gory | August 24th, 2010 0 Comments

There’s a polarizing issue in the Highlands Park neighborhood of San Carlos these days, and it has to do with the potential to install artificial turf at the neighboring park.

How does this affect homes and home values? Since everything under the sun has to be disclosed when selling a house, here’s a simplified after-effect of installing artificial turf in a public park:

  1. Turf on athletic fields at public park  = Year round sports instead of seasonal
  2. Year round sports = Constant soccer, baseball, basketball games going on year round
  3. Constant games going on = Lots of cars parking on streets in front of homes
  4. Lots of cars parking on streets = Impact on ‘peace and quiet’ of neighborhood
  5. No peace and quiet = Perceived value of homes goes down
  6. Home values going down = Local residents do not want artificial turf

In the SJ Merc the other day was this article.  Here are some of the salient highlights from the article:

With San Carlos poised to start installing artificial turf at Highlands Park today, a group of residents who sued to block the project say the city is taking a big risk by breaking ground before a judge has ruled on the lawsuit.

They say the city shouldn’t start the project until a San Mateo County Superior Court judge weighs in on the lawsuit filed by Save San Carlos Parks, which argues the city didn’t properly review the new field’s potential environmental effects on health and traffic. Judge Marie Weiner is expected to rule by Aug. 25.

If Weiner decides the city must do further environmental work, it will have to pause construction and leave the park unusable and in a state of disrepair indefinitely, said Greg Harris, a member of the residents’ group. He said it’s worth waiting another two weeks for a ruling on a project that was conceived a decade ago.

City officials counter that they could take a financial hit if they don’t proceed with installing turf, which has been done without controversy in other Peninsula cities but has been one of the hottest topics in San Carlos for years.

Officials say the $1.7 million bid from Interstate Grading and Paving, which the city council accepted in February, is an exceptionally low price due to a job-hungry construction industry and an Italian turf manufacturer who is offering a discount to break into the American market.

Harris dismissed the cost argument, saying it’s possible the city could get the same bid or an even lower one if it advertises the project again after the judge’s decision.

The city plans to fence off the 3.5-acre lower athletic field at Highlands Park today for site preparation work. Excavation and grading work will start next week, said Public Works Director Robert Weil. If all goes well, the project will be finished by the end of the year.

Weil acknowledged that the park will be unusable if the city has to pause construction to do further environmental studies, which could take months, but he said officials will ensure the park doesn’t pose a hazard.

Proponents say the artificial surface will lower maintenance costs and allow the field to be used year-round. The grass fields, on the other hand, must periodically be closed so they can recover from heavy use.

But opponents have said the extra use allowed by the new surface will bring more traffic to the neighborhood. They also had objected to the use of rubber pellets between the grass blades, though the city has since decided to use an organic infill instead to address those concerns.

“We’re not going to delay a project that will benefit thousands of people because a small neighborhood group has filed a lawsuit against us,” Klein said.

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Urban Legend Hits the Real Estate World

By Ed Gory | December 21st, 2009 0 Comments

Be forewarned — no, this is not about kidney harvesting, Nigerian Lottery winnings, or Bill Gates giving everyone lots of money for forwarding an email — there is an email making the rounds titled “HR 2454: CAP AND TRADE ENERGY BILL”, which purports that new legislation will require all homes to retroactively pass new energy standards before they are sold.

Some even say that all homes will now be required to get a “label” for your house every year, proving that your home meets new energy standards.

This is all patently and unequivocally FALSE. (and you can even check Snopes.com here to doublecheck)

Bottom line, our government is not going to do anything – ANYTHING – that will adversely affect the real estate market, which is absolutely one of the key elements in our ongoing, slow economic recovery. Why do you think they recently overwhelmingly voted to extend the first time buyer $8K tax credit bill, as well as extend the $729K conforming loan limit? They want to encourage people to have more confidence in home ownership.

I also consulted our National Association of Realtors (NAR) position on this, and below is what it said. The most revealing statement, which contradicts this email is that this bill  ”Does not create a federal energy audit requirement for real property”

“The U.S. House of Representatives approved H.R. 2454, the American Clean Energy and Security Act by Reps. Waxman (D-CA) and Markey (D-MA). Following NAR’s long-standing policy to only take a position on legislation, or provisions within legislation that have a direct affect on real estate, NAR worked with our Congressional allies to strip the Energy Bill of provisions that would have adversely affected our industry.

After multiple consultations with the NAR Climate Presidential Advisory Group, the NAR Land Use, Property Rights and Environment Committee, and state associations who had dealt with energy audit legislation at the state level, the Land Use, Property Rights and Environment Committee directed NAR staff to concentrate on the real estate provisions in the bill.  As a result, NAR issued calls for action and made this a talking point for Capitol Hill visits during its recent Midyear meeting.

Overall, REALTORS® succeeded in making a number of positive changes affecting the real estate provisions of the bill. The House-approved bill:

  • Does not create a federal energy audit requirement for real property;
  • Exempts existing homes and buildings from any federal guidelines for new construction energy efficiency information labels.
  • Prohibits the implementation of any labeling during a sales transaction.
  • Leaves the decision to states as to whether to require energy audits, disclosures, etc.
  • Provides property owners with significant financial incentives, matching grants and tools to make property improvements and reduce their energy bills;
  • Prohibits the Environmental Protection Agency from regulating residential and commercial buildings under the Clean Air Act;
  • Eliminated an early proposal to allow citizens to sue over minor climate risks under the Clean Air Act; and Establishes green building incentives for HUD housing, including a loan program for renewable energy, block grants and credit for upgrades in mortgage underwriting.”

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89 Offers? In San Jose? And a good use of Twitter, too?

By Ed Gory | June 10th, 2009 0 Comments

posted by Ed Gory of the Intero San Carlos office

Now, this just sounds insane, or maybe I should have started it as “I never thought this would happen to me, but…”

It’s mind boggling, but the notion of multiple offers – particularly on the lower 1/3 of the market here in the Bay Area– is as prevalent now as it was 3 years ago. Now granted, the affected market segment is much more specific – I don’t really see this happening much on the higher end of the market (above $900K). But now that lending has thawed a bit from the catatonic state it was in Q4/’08 and Q1/’09, there are a TONS of investors and first time home buyers that are scooping up homes once priced in the $500K+ range which are now priced in the $200K-300K range.

There’s a huge “dang, this is a bummer” element for any agents like myself, representing buyers who keep getting outbid, or beat to the punch by others making offers on homes the day they come on the market.  It seems like in Q4/Q1, that a home would come on the market, and the buyer mentality was “I’ll just wait 2 months, and they’ll be lowering their list price”.  That scenario is long gone. My recommendation to any buyer out there is this: if a home seems priced ‘right’ (totally subjective), don’t wait to make an offer on it, because chances are someone else will. What about making lowball offers? Don’t even bother, as the window where you could go into contract offering 10% or more, below the list price has pretty much shut for good.  Lowball offers? You might as well just stand on the rooftop and say “I don’t really want this house.” Don’t try it, as that train left the station in Q1.

So back to the 89 offers.

So I (representing a buyer) present a good, slightly over asking price offer on an REO (bank-owned) home in South San Jose.  Couple days later, an automated email from the listing agent comes back saying they’re doing a multiple counter-offer, to ALL of the 72 offers they received.  I go to check the Listing Agent’s listing updates on Twitter, and they now have 89 offers. I wouldn’t make that up if I tried. Eighty….nine…offers.

I then picked up my jaw from desk upon which it hit….

Although this was a situation I thought I would never see, I was very impressed with listing agent’s usage of Twitter. Many of these foreclosure-specialist listing agents have 20, 30, 100 listings – all foreclosures – they are juggling all at the same time. Updating the status on a bulk amount of listings in MLS could be a time-consuming task. Using Twitter, the agent was able to give a ‘to-the-minute’ update announcing if offers were submitted to the bank, or if they are in counter-offer with a buyer, or if they’re taking no more offers, etc.

But back to multiple offers, no matter what you read, the market in many instances around the Bay Area, is showing PLENTY of signs of life.  Yes, things slowed down early in the year, as did almost every micro-market in the world. But even between the price points of $800K – $1.3M, there are homes that are going into contract within 2 weeks of coming on the market. It’s becoming less and less of an anomaly. Ultimately, if a house is priced right based on its location, it will sell.

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Measure B Passes!

By Intero Real Estate | May 26th, 2009 0 Comments

Voters pass San Carlos schools parcel tax

Our efforts here in San Carlos paid off! The San Jose Mercury New recently had an article on Measure B passing, here were some of the highlights:

It took six months, but the ailing San Carlos School District finally got its parcel tax.

The ballot initiative for the $78 per parcel tax passed convincingly.

According to semi-official results posted by the San Mateo County Elections Office, 71.2% of voters voted YES on Measure B, with all 24 precincts reporting. The parcel tax needed support from two-thirds of voters to pass.

The measure taxes San Carlos property owners $78 more annually for six years. Seniors ages 65 and older can seek exemption. The district’s current $110 parcel tax will sunset in 2011.

Measure B will generate $800,000 per year for the district, which is facing $2 million in budget cuts next school year. In March the district issued pink slips to about two dozen certificated employees, including teachers, and warned about 16 to 20 part-time and full-time personnel would likely be laid off if the measure failed.

Superintendent Steve Mitrovich said budget cuts, including the possibility of some layoffs, will still be necessary even with the new revenue.

The district’s board of education will meet Thursday to discuss next school year’s budget and decide whether to lay off any certificated employees.

"It doesn’t put me completely at ease," said Brittan Acres teacher Jessica Melton, who got her pink slip in March. "But I think that with this money it can help just regular programs like literacy and counseling and things like that."

"Honestly I thought given the current economy that it would have been a struggle to pass," said Chris Mahoney, director of the district’s Charter Learning Center. "It just makes the city more desirable; people want to move to San Carlos because we take care of our kids."

Thanks to all who voted for this very important measure – keeping the quality of schools up in San Carlos will continue to help with our property values in the long run!

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