Top 5 Strategies When Buying a House

 

Analyzing the market trends in real estate is just as important as your other investment tracking strategies.  I do my best to inform clients how to find and negotiate the best deal possible and market statistics play a big part.   Understanding can mean success or failure and will determine if you overpay for a property.

As an example, homes that are selling in an FHA range of loans – (ceilings of $625,000) represent 68% of the demand but only approximately 42% of the available homes for sale in this range. This means that the nicest homes in this price range will get multiple offers and will only last a few days before going into escrow. On the flip side, luxury homes priced over $1,500,000 represent only 4% of the demand but 22% of the inventory!

It is a sellers market for the lower priced homes and a buyers market in the luxury home market.

So what doe this mean for you?  Here are my top 5 recommendations to keep in mind when buying a home:

1.) Stay on top of the listings on a day to day basis.
Use speciality websites like HomesinSouthOrangeCounty.com or FindHomesinOC.com to track your searches. These are updated regularly rather than sites like Zillow or Redfin.

2.) Work with your broker or agent making sure they know what you want.
Often times agents learn about homes before they are ready to hit the MLS. You can possibly avoid the arduous process of open houses and multiple offers.

3.) Don’t think too long before visiting these homes. If you see something you like, go and see them right away with your agent.
I, like other agents will prioritize your needs if you have an active search plan in process involving your agent. I am always available to take calls in the evening and on week-ends.

4.) Make sure you have a team working for you.
Make sure you are ready during all stages of a purchase.  I strongly recommend a pre-approval qualification letter be put ready from your mortgage banker so when you find your home, your offer will be strong and stand out. Our team consists of a broker, a mortgage banker, a transaction coordinator, a title officer, an escrow officer, a property inspector, a handyman, a team of termite and repair professionals, a roofer and more. You will need all of these professionals before you move into your new home.

5.) Make sure you have a plan to address any special needs.
i.e. If you have a home that you need to sell, share that with your broker. Brokers like me are experts in helping you with transitional ownership. Selling your home and buying your home can put you in a disadvantage if you don’t have a plan in place.

Our next blog post will address transitional ownership. This will highlight both the journeys of rent-to-own as well as sell-and-then-buying a new home.

Call or email today to discuss your needs and to get a plan working for you! : jerry@henberger.com

 

The Summer Housing Shift

The Spring Market is now in the rearview mirror, making way for

a whole new season in home sales: summer.

The Summer Shift: The expected market time has increased by two weeks longer since the prime Spring Market.

Housing tends to follow a similar cycle every year. This time of year is no different. It started a couple of weeks ago with graduation. The market slowed a bit; many houses were not selling as rapidly as they were in April and May. The explanation from the real estate trenches was that it was due to graduations and the end of the school year.

Then there is our national holiday, the Fourth of July. Not as many buyers tour homes as they turn their focus to playing in the sun, barbecues, and fireworks. In housing, the holiday turns into a distraction of grand proportions and the lingering effects can be felt for a week.

As Southern California experiences summer heat waves, many will turn to the oasis known as the community pool, and others will flock to cool off in the welcoming, crashing waves of the Pacific. The heat will also distract the real estate market from performing on all cylinders.

Finally, the slower housing scene will be blamed on the family vacation. From Hawaii, to the East Coast, to the ultimate family destination, Orlando, it is the season for summer vacations. Camping, airplanes, house boats, motor homes, and road trips, just about everybody has plans. It is hard to tour homes or conduct real estate transactions when you are checking in to a Hyatt and touring the Empire State Building.

Many will blame the slower housing market on graduation, the 4^th of July, hot summer days, and family vacations. It is, quite simply, the Summer Market. It happens every year. For sellers and buyers in the real estate trenches today, they are all experiencing the shift in the housing market already and we are just a couple of weeks into the official start of summer.

A Summer Approach for Sellers: with buyer traffic down and the expected market time rising, it is now more important than ever to NOT get too far ahead of the market by overpricing. Multiple offers can still be attained, but only for those homes that are priced at, or very close to, their Fair Market Values. Here’s a quick refresher for determining that value: take the most current closed and pending sale activity and carefully adjust for upgrades, location, amenities, and condition. The Fair Market Value is not determined by arbitrarily pricing a home out of thin air. Ignoring the fundamental shift in activity during the Summer Market will result in many homes being overpriced with absolutely no success; instead, they will waste valuable market time during the second best time of the year to sell.

A Summer Approach for Buyers: although competition dips a bit during the summer, buyers must respect the fact that it is still a seller’s market. Buyers are not able to call the shots. Sticking to paying the Fair Market Value determined by recent market activity is key. Also, knowing the local or neighborhood market conditions is extremely important as well. It may be the case that a certain neighborhood is a bit hotter than another and when a home comes on the market that is priced well and is in great condition, buyers must be willing to push the envelope a bit in terms of value. Paying a few thousand dollars more than the last comparable sale may be the winning strategy that will allow a buyer to beat out the competition. Grossly overpaying is not advised. Sometimes waiting for the next shift in housing, the Autumn Market, may be a wise approach as well.

For both buyers and sellers, the Summer Market shift means a new approach to the market is crucial in order to find success. Realistic, level headed, patient buyers and sellers will be rewarded from now through the first few weeks of August. From there, the housing market will experience another shift, the Autumn Market. Stay tuned…

For more information on market trends click the link below:

Henberger Properties Market Trends for July

 

What is a 1031 Tax Exchange?

1031 Tax Exchange

A 1032 Tax Echange is a tax-deferred exchange or a transaction to defer the payment of capital gains by “exchanging” investment property owned by an investor (“relinquished property”) for another investment property (“replacement property”) of equal or greater value.

The most common type of exchange is a delayed or straightforward type of exchange is a delayed or straightforward exchange.  By properly effectuating an exchange, the investor is able to defer the realization of depreciation tax on the relinquished property.

Choosing the Right Intermediary

An investor should be selective in choosing a Qualified Intermediary (“QI”).  Choosing a professional QI with financial strength is paramount to a successful exchange.  

Choosing the Right Broker

Make sure your broker has the resources to successfully bring the right team together to help you succeed.

For more information to sign up for a 1031 Tax Exchange Seminar,

–  contact: jerry@henberger.com  Direct Line (949)874-7126

Hosted by:

REMAX Prestige Properties

http://www.HenbergerProperties.com

http://www.ExchangeResources.com

*If your property is listed with another broker, this is not a solicitation for a listing. 

**Be sure to consult your tax advisor on any transaction that may impact your taxes.