National Home Sale figures showed an 11% increase in October compared to last year.  This was based on homes for sale where a purchase contract was signed in September. I have listed real estate statistics for San Jose and a couple of other areas below. Note that home sales statistics are typically 60 days behind the reporting date. This is due to the time it takes to close an escrow which is currently around 45 days.

San Jose- The median sales price for homes in San Jose CA for Aug 11 to Oct 11 was $390,200 based on over 2,600 home sales. Compared to the same period one year ago, the median home sales price decreased 3.1% and the number of home sales decreased 9%. The “average price per square foot” for San Jose CA was $354, an increase of 20.4% compared to last year. The average listing price forhomes for sale in San Jose CAwas $522,715 for the week ending Nov 23, which represents an increase of 0.3%, or $1,536, compared to the prior week.

Cupertino- 95 homes sales were reported from Aug to October with a median sales price of $900,000. Cupertino CA price per square foot for was $582, an increase of 5.1% compared to the same period last year. Compared to the same period one year ago, the median home sales price decreased 4.3%, or $40,500, and the number of home sales decreased 30.1%. The average listing price for homes for sale in Cupertino CA was $1,180,127 for the week ending Nov 23, which represents an increase of 1.7%. A small increase from last week.

Los Gatos- Compared to the same period one year ago, the median home sales price for Los Gatos Homes decreased 0.1%, or $1,000, and the number of home sales decreased 18.2%. The average price per square foot for Los Gatos CA was way down at $487, a decrease of 11.5% compared to last year. The median sales price for homes in Los Gatos CA for Aug 11 to Oct 11 was $899,000 based on 135 home sales. The average listing price for homes for sale in Los Gatos CA was $1,832,949 for the week ending Nov 23, which represents a decrease of 1.7% compared to last week.

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Myth #1:  Buyers agents want you to pay more to get a higher commission.

Wrong. The value of the home has to meet the lenders appraisal.  If it doesn’t meet the lender’s appraisal the mortgage loan won’t get  approved.  The seller, having now expected a higher price,  will be disappointed having to  accept a lower offer.    Your agent wont get paid and you don’t get the home because the seller becomes uncertain and reluctant.   It is always better to make a reasonable market wise offer that has potential for negotiating, especially if there are multiple offers.

Myth #2:   Listing agents want you to accept any offer quickly so they can get paid.

Wrong. If you are provided a Market Analysis then you should know the current market price.   This puts you in the driver’s seat to consider only those offers that are reasonable.  Most listing agents want you to get the most for your home. That allows them bragging rights to gain more listings.   Simply ask for a new market survey to give you comfort in support of accepting an offer for your home.

Myth #3:  All agents conspire against their buyers/sellers to get a sale.

Wrong. While they are sales persons, they have a fiduciary responsibility to show good care and ”Realtors” abide by a strict code of ethics.   The best agents enjoy the art of negotiation (fighting for their client). It’s in their DNA to win and only win- losing sucks.   However, every industry and market sector have their bad apples and Real Estate is not immune from worms.   Always ask for at least 3 referrals from an agent’s past clients, call them and you will know if your agent really cares about you.

Myth #4:  Foreclosures are the best deals.

Wrong. While buying a foreclosure feels like a great deal they really aren’t.   There are inherent issues with foreclosures that price alone does not overcome.   In today’s volatile market foreclosures are often found in distressed areas.  Location is still the number one factor in home value.  Historically distressed areas reduce the upside potential. If the home is below market now it will likely be below market when you want to sell.    Not to mention the number of potential hidden conditions that are not readily identified or disclosed.   Be sure to have a thorough property inspection from a reputable inspection company, analyze every value factor and consider future upgrade costs that will meet the neighborhood standard.

Myth #5: Making a cash offer is better than one with a mortgage loan.

Wrong. The process of escrow still remains.   While a cash offer can close escrow in a short 21 day period, an offer with lending can close in the same period or within 30 days, typically.   The seller still gets cash in the end so, waiting an extra week or two and sell for a higher price trumps a cash offer.

Myth #6:  Having an Open House will sell your home.

Wrong: Having an open house does not sell your home 99% of the time.    Statistics show that only 1% of homes sold actually sold from  having an open house.    With so many internet sites providing virtual tours and numerous pictures more and more buyers pass on spending the time to visit an open house. An open house does allow all the neighborhood looky loos and wannabe buyers to traipse through your home.   Serious buyers  will call an agent to schedule a private tour.   Great Pictures, a Virtual Tour and a liberal showing schedule will sell your home 100% of the time.

Myth #7:  Short Sales are a waste of time.

Wrong. If the best home that suits you is a short sale then it is never a waste of time.    Agents often refer to short sales as a waste of time because it takes so long to close the sale.   Waiting an extra month or two to get the perfect home is worth every delay. Buying Real Estate should always be done in a patient and thoughtful manner.  Hire an experienced Realtor who has a track record in all types of sales to help overcome foreseeable delays.

Myth #8:  Making a low ball offer for your primary home is the best way to get a deal.

Wrong. When you have identified a home that you want make an offer that is market worthy, at least. Low ball offers always create an adversarial environment and will cause your offer to be rejected out of hand. Low ball offers are best suited for investment property strategies where the outcome is based solely on numbers and not where you want to live. Offers that will initiate some negotiation are far wiser and more successful.

Myth #9:   Listing my home at the highest price leaves room for negotiation.

Wrong. Buyers search for homes in specific price ranges.   If you would accept a lower price then list it closer to that price where more buyers will find it. Listing your home at the highest price reduces the number of buyers that will consider making an offer. Most buyers search for homes priced below what they actually qualify for.  Price your home competitively to increase your pool of buyers and encourage multiple offers.

Myth #10:  If one Agent is good two is better.

Wrong. Trust is more important than pitting one against another.  Partnering with a trusted professional will always prove to be more beneficial.  A full time committed Realtor will present guidance and opportunities not found if you waste their time.   Interviewing a few recommended Realtors and committing to one will prove to be more advantageous to you.

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Home Buyer closing costs are arguably more important than the loan approval.     You  should consider them first.  While consulting with your Realtor ask them to describe all the different ways these costs can affect your offer, the price you pay and how you may be able to use them to help you afford a more expensive home or reduce you payment.

I have used these costs to make the best offer in multiple offers situations.    Call it creative offer structuring.   Remember,  only a few of these are commonly packaged in your mortgage and if they are not negotiated in, you should be prepared to pay them at closing.

Lender fees:

• Loan origination points – depends on your lender and type of loan
• Prepaid interest – depends on which day of the month you close
• Property tax impounds – depends on the type of loan and time of the year you close
• Insurance impounds – plan on 6 months of insurance, if required
• Processing/Underwriting fees – depends on your lender and type of loan
• Document prep fees – approximately $150.00
• Appraisal fees – approximately $450.00
• Funding fees – depends on your lender and type of loan
• Tax service, flood cert, etc. – approximately $150.00

Title fees

• Owner’s title policy – determined by purchase price
• Lender’s title policy – determined by the loan amount
• Document prep, notary, recording, courier, etc. – $200.00
• Escrow fee – also determined by purchase price

Other fees associated with the Buyer Side:

• Prorated property taxes – depends on the type of loan and when in the year you close
• Homeowner’s dues – varies depending on the development
• Transfer tax – $1.10 per $1,000 of purchase price
• Annual homeowner’s insurance policy – depends on the type of home being purchased
• HOA transfer fee – varies depending on the development
• Inspections – Property (est. $450), Termite (est $250) & Roof (est $175)- other inspections may be recommended i.e. Chimney, Septic, Foundation the list can be long in some cases.

What are buyer contingencies?     click here for a review

When visiting a nearby Cambrian home I found some fantastic upgrades.  The Super high quality finishes and design choices really stoked my curiosity.  Who does work like this anymore?

This wasn’t the first time I had the chance to see this kind of affordable quality.  A few months before I had the pleasure to witness some outstanding Vanity and Armour choices being installed in a beautiful Los Gatos Estate home.   Matched with the suttle venetian plaster walls in the Master Bath and the  faux Limestone  walls in the Bedroom caused me to want to learn more about this craftsman.

The owners of this Los Gatos Estate Home knew that selling their home today would not meet their personal goal of having a newer construction home.    There just wasn’t enough equity to roll it over.   the best choice:  Do some needed upgrades and stay put.

The craftsman responsible for all this quality, Greg Hendricker, owns the Cambrian Park  home I mentioned before.  Simply put, it’s a live in design studio.   There are too many functional upgrades to mention them all.    The bedroom built in’s are what really inspired me to write this post.

Greg specializes in custom designed built in cabinetry at affordable prices.    Not only does he design them, he builds them and applies the custom finishes to match  specific decor choices.

Greg’s wife Chele has embraced the flexibility in their designs and deserves some credit too.    The kitchen has a hidden refrigerator that would amaze the most discerning decorator/architect.

With the number of custom choices Greg offers,  it is apparent the choice of selling your home or upgrading may not be so difficult. following his free design consultation.

If you are considering upgrading or have thoughts of selling  your Los Gatos or Cambrian Home,  allow me to help.   I will  provide you with a FREE market analysis and guidance to help you determine your best course of action.   In addition to the free analysis,  you can learn more about the long list of contractors I have compiled.    All this with no obligation!  Why wouldn’t you?  click here to view all the homes for sale in Cambrian or  all the homes for sale in Los Gatos can be found here.

Cambrian Park in a Few Words

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I don’t know how many hours I have spent preparing Los Gatos buyer packages, uploading internet marketing and providing guidance to the Seller in anticipation of the “magic” Open House.  Only to show up and find the Seller forgot to do everything that they so eagerly agreed to do after reading “the 26 sellers mistakes”

I should have learned that a plan only lasts until the first detail slips.   When that happens the magic is gone.  Sort of.

It usually starts at the front door, or more accurately, when I drive up and see they have an alfalfa field instead of a manicured lawn.  At the front door, trying to decide what to do with the lawn, with only minutes before the buyers start to arrive,  I realize I am done.

The porch is not swept and “Spongebob” decorations from the previous weekend birthday party are still up.  Hmm…Wonder if they had a magician at the party too? I could sure use one at that moment.  The need for a magician becomes most evident when I open the front door.

The smell that comes rushing at me says  “Sorry, we forgot to take out the Kitchen trash after the birthday party.   It was a great party!  Spongebob and Friends”    Friends?

Oh No!  The adults had Crabby Patties?  Or crab cakes, or a crab feed.  Whew.    THIS pigeon is not going to disappear in a red silk rag.

I am no magician, but I better become one fast, right?!  So, I reach into my little bag of tricks and get the scented candle burning…ya. Like that’s going to solve it.  This is when your “magic” Open House plan is doomed.

One of the most common comments from my Home Buyer clients is…Why didn’t they, at least, clean up a little?…Sheez!

Squidweeeerd!

The only way your Realtor can make your open house magic is with your help!  Follow their guidance….it comes from too many experiences like the one I have described.   Making your Open House a success is going to take a little effort.  It’s not that difficult, really.

The simple is the easy and that is the way selling your home should be. Simple and easy.

You can read more Seller ideas by searching for “seller”  using the search box above.

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Just released, the First Time Home Buyer Tax Credit has changed.  Yes, already!  The fund, at only $200 million dollars, will not last very long and you had better know the new rules to take full advantage of it.

The $200 million dollar fund  still allows a credit amount of 5%  or a maximum credit of $10,000, whichever is the lesser amount, based on the final sales price.  A very substantial credit!

Previously, the first time buyer was required to have the seller of record sign the tax credit form 3549a  prior to submitting the application for the credit.  However, on June 1st , changes were made for First Time Buyers of previously owned homes.

According to an email I received from Colleen Graves of Lawyers Title in Southern California, a popular Escrow and Title company, chosen by financial institutions selling their bank owned (REO, Foreclosures) properties throughout California,…

….“if you are buying a previously owned home, resale not new construction, then you simply need to provide the basic sale information including the final HUD1 and the seller signature is not required as previously understood.”   For my client, who just closed on an REO property, this was great news.  Motivating the all too robotic foreclosure minion to get that seller of record signature in time, was not an appealing thought.

The seller required signature rule remains in place for First Time Buyers purchasing  new construction properties though.

Taking advantage of the First Time Home Buyers tax credit is the only path for many potential First Time Home Buyers to purchase homes in the Golden State.

Does your home purchase qualify for a first time home buyer tax credit?  If you have not owned a home in the previous three years and you plan to live in it as your primary residence…yes! it qualifies.
Another important rule regarding the tax credit form 3549a is that it must be submitted no more than 2 weeks following the close of escrow.   This can become difficult considering the form cannot be submitted prior to the close of escrow due to the HUD1 requirement.

The HUD1 (final closing statement) must be submitted with the form 3549a causing the buyer and buyers agent to be  ‘on their game’.  If your agent is not aware of the new requirements you could lose your chance to take advantage of this tax credit by submitting the application too late or incomplete.

When you are interviewing agents, to help you buy your new home, ask them if they are current on the ever changing laws, regulations and opportunities in the real estate market place.   Some of the recent changes are: multiple agency disclosures,  purchase contract change, short sale addenda and tax credit availability.

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• Realtors Want Congress to Tweak Tax Credit Timeline (blogs.wsj.com)
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Without doubt, the best time to think of selling your San Jose area house is before you buy it.  In fact, there’s a saying in professional real estate circles that, “You make your money when you buy.”  Unlike prior generations, today’s home owners will typically sell their house within five to seven years.  That may seem like a long time in your own personal life, but it is just minutes in the world of  San Jose homes for sale.

Wouldn’t it be nice to go into your purchase with a plan in mind?  Here are a few tips on how to choose a San Jose house for resale value, while also finding a home that you absolutely love.

• Purchase Price. Perhaps the biggest lesson learned from the housing crisis is to not overpay for a house.  This can be tough when you absolutely fall head over heels for a home.  But paying a fair price today means you’ll be able to accept a fair price tomorrow.  So check your emotions at the door, and proceed with your head.  It’s worth taking time to research pricing trends in San Jose area neighborhoods before committing to a purchase you may regret when it’s time to sell.  We have the resources, years of market insight, community knowledge and negotiation skills to ensure all our buyers pay only what they need to for  any San Jose home for sale.

• Location, location, location! Location can either be your best friend or your worst enemy when buying a home, and in essence, can make or break a home’s resale value.  San Jose area communities provide the life force for home price.  High ranking school districts, recreation facilities, and shopping are just a few amenities that you can bet will capture the eye of future home buyers.  Researching future development and zoning regulations will also help ensure your new home will be an asset when it comes time to sell.

Noting the details of the location is important too.  Does the lot back onto a busy street?  How about a shopping center or hospital?  Traffic noise, parking lot lighting and trash receptacles bordering your backyard will definitely have an impact on resale.  Noting the condition of neighboring houses will also play a key role in determining resale value.  Most neighborhoods will have similar lot sizes, with smaller and larger lots to fill in awkward spaces such as cul-de-sacs and road curves.  And while larger lots are usually more desirable, you may end up paying a premium that you won’t recoup when it’s time to sell your San Jose home or real estate investment property.

• Repairs, Remodeling, and Fixer-uppers. When deciding on a San Jose home for sale, know the difference between acceptable and unacceptable repairs and upgrades.  Cosmetic changes such as ugly wallpaper, paint, and door hardware are easy fixes and worth the time and money.  Foundation cracks, water damage, and roof damage are not as kind to resale value.  These are repairs that are necessary to maintain the current value of your home and, unless the home is priced below market, won’t add a penny to resale value when it’s time to sell.

And most importantly, you’re not alone in purchasing a home!

Our Buyers have the peace of mind to focus on finding the perfect San Jose home while we look with a critical eye at every home’s potential resale value.

Continue: read part 2 for buying a San Jose house for sale

There are no ‘Magic Wand’ solutions if you find yourself against the wall with your mortgage.  Using common sense and a applying pragmatic approach is still the best and most effective way to determine whether you should sell your Los Gatos home or buy a smaller more affordable house in San Jose.

A good rule of thumb is to obtain 3 professional opinions and weigh them one against the other.   The first solution may not be the only solution and… Watch This Video!