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As printed in the OC Register / Saddleback Valley NewsWritten by Jim E. Flynn, Century 21 Beachside Realtors, Lake Mission Viejo
Oct. 30, 2008
Do California Homes Still Rank in the Top 10 Most Expensive Markets?
Q. With home prices continuing to fall, do California homes still rank any where in the top 10 most expensive markets? - Brandon in Mission Viejo
A. Yes, along with the reduction in California home prices, real estate markets in many of the other parts of the country have adjusted commensurately. Actually, California home markets rank in eight of the top 10 most expensive housing markets.
An annual comparison of similar homes found that California is home to eight of the top 10 most expensive housing markets in the U.S., while eight of the top 10 most affordable cities are in the Midwest, according to a recently released Coldwell Banker Home Price Comparison Index. The most expensive real estate market, La Jolla, Ca., is $1.7 million more expensive than the most affordable, Sioux City, Iowa, for a comparable home.
The HPCI compares the average value of 2,200-square-foot houses with four bedrooms, two- and one-half baths, a family room and a two-car garage across 315 U.S. markets.
Q. Since it seems to take so very long to get an answer to an offer on a bank-owned property, what are some recommendations you have for negotiation with sellers that do not have bank owned properties. - Leonard from Lake Forest
A. You are right, many prospective buyers, especially those that want to close an escrow this year with some comfort level, are now looking at properties for sale by owners and not bank-owned properties. There are also some encouraging indications in our south Orange County market. According to Dave Knox of Fidelity National Title, business is "ramping up" and the recent mix had declined to 40 percent REO/bank-owned properties. History says that banks will develop more complete "short sale departments and not sit on escrows four, six, nine months and aim to close in three to four weeks.
Here are some negotiating tips.
- The more you know about a seller's motivation, the stronger your position. Knowing if a seller has a job transfer for example, may indicate the need to move quickly and receptivity to accepting a qualified lower price and faster escrow.
- Others in the "motivated seller" category may include those who have already made an offer on another home and people going through a divorce anxious to do a wrap.
- It is always good to remember that the listing price is what the seller would like to receive but, it is not necessarily what they will accept from a strong buyer. Some of the strongest buyers in today's market are cash buyers. As the bank-owned properties flush out or are passed over and more seller-owned properties are replacing them, terrific values for buyers will remain. Another good reason to buy now is that jumbo loan limits will decrease to $625,000 or $650,000 and FHA down payments increase to 3 percent on Jan. 1. If you are considering buying, these next 60 days might well be the best time.
Jim Flynn is a Centurion" Realtor with Century 21 Beachside Real Estate in Mission Viejo.
Original article in The Register
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Jim
Jim E. Flynn
CalBRE license #: 01215480
Phone: (949) 463-0739