The OTHER Offer

As I mentioned Monday, Team Patereau received two offers on two different listings last week-end. The first one I bragged about on Monday. Now let me tell you about the OTHER offer.

The listing is a single family home in San Jose’s Eastside. It’s a 3 bedroom, 1½ bath, 49-year old home. In our promotional material we describe it as, “FIXER!” (That’s all capital letters, and an exclamation point added for emphasis.) It’s been on the market since February. From that you can assume that the property has been a challenge.

Finally, with two “Price Corrections” (reductions) we received an actual written offer. Phew! Team Patereau celebrates. Then we read the offer.

Offer Details:

• Offer Purchase Price is $450,000


• Good Faith Deposit is $4,500


• First Loan is $360,000


• Second Loan is $90,000


• Buyer gets Good Faith Deposit of $4,500 back at close of escrow


• Buyer wants Seller to credit Buyer at close of escrow $13,500.


• Buyer is one individual person


• Buyer intends to occupy the property as his personal residence


• Preliminary Loan Approval letter from lender enclosed with offer indicates Buyer approved for 100% loan.
  

Things we know from discussing the offer with the agent who wrote it and the lender who wrote the Preliminary Loan Approval letter:

• Buyer does not intend to occupy the property as his personal residence. He intends to “Flip” it.


• Buyer did not give a check for $4,500 to agent for the Good Faith Deposit.


• Real Estate Company that wrote the offer is tied closely with the Lender who wrote the Preliminary Loan Approval Letter (same broker).
  

Translation:
Buyer is a “Flipper,” probably a contractor who is not going to be out of pocket any money to acquire the property, found a lender to give him a “Preliminary Loan Approval” letter for a 100% loan package, and there is no copy of the check for the Good Faith Deposit enclosed with the offer, and the agent indicated (after several unreturned phone calls and a final call threatening to call his broker) that he never got a check from the buyer and the buyer has recently indicated he doesn’t intend to give a check.

The agent who wrote this offer is committing fraud, the potential buyer who signed this offer is also committing fraud, and the lender indicating that they will do a 100% financing package for a non-primary-residence fixer is almost committing fraud, but we’ll leave it at lying, shall we.

In the contract words, page one, INITIAL DEPOSIT, the words are: “Buyer has given a deposit in the amount of $4,500 to the agent submitting the offer…”
The buyer didn’t give it and the agent didn’t receive it. That’s fraud.

Same page, contract words are “Buyer intends… to occupy the property as Buyer’s primary residence.”
The buyer doesn’t. He told the agent he doesn’t, he told the lender he doesn’t, and the agent and the lender told Team Patereau that he doesn’t. That’s fraud.

I recently read about fraud in a blog entry written by Bryant Tutas, titled, “You Want My Sellers to do What?” Bryant’s sample of fraud was overt and obvious to even the least experienced real estate licensee.

The fraud in the offer on Team Patereau’s listing was a more covert, or subtle, form of fraud. It happens fairly regularly in a market like we have in this area, and it gets blamed on "hungry agents" and "starving realtor syndrome." This is the kind of thing that real estate licensees protect their clients from. This is why a real estate agent is a really good idea for every real estate transaction.

Needless to say, when Team Patereau went over the offer details with the Seller, the offer was rejected. So, if you know of anyone who wants to buy a fixer in East San Jose, California, Team Patereau can be reached at 408-981-2799. I’d put in a picture here, but my previous post indicated that if there isn’t anything good to show about the property, don’t show a picture. This property needs a buyer with VISION. Enough said.

SPECIAL NOTE TO AGENT WHO WROTE THIS OFFER:
Fraud is when you lie. Don’t lie, not even when you really, really, really need to get a deal going. Don’t lie to your client, don’t lie to other agents, and don’t put lies down in an offer.

SPECIAL NOTE TO LOAN OFFICER WHO WROTE THIS PRELIMINARY LOAN APPROVAL LETTER:
Fraud is when you lie. Don’t lie, not even when you really, really, really need to get a deal going. Don’t lie to your client, don’t lie to other agents, and don’t put lies down in a loan approval letter.

Technology WANT vs. NEED

I really want one of the new iPhones from Apple.

There, I’ve declared it to the world.

It turns out that there are benefits for a real estate agent, like me, to have an iPhone. Thank you OMUOTO for helping me begin to justify this business investment. He really did a better job of justifying why my customers would want an iPhone in his article for vflyer Blogsight, but I was able to pick out two components where I might benefit:

1. The phone part – duh!


2. GPS – a real estate agent needs to be able to get to and from new places.

Do I need it? Need – there’s a word to get the defined. I looked it up at the Meriam-Webster online dictionary. The verb form of the word, under definition 2 could be usable for me here. The phrase, “a physiological or psychological requirement for the well-being of an organism,” looks like it might apply to me.

As a matter of fact, I think that it absolutely does apply to me.

So long for now. I’m going shopping!

Offers, Offers Everywhere

It’s Monday morning and I’m feeling like an accomplished real estate agent today. Team Patereau has received offers on two of our listings!

Having listings is great. Receiving offers on those listings is tantamount to a miracle in today’s market in Gilroy.

Reflecting on what moved potential buyers to take action on these listings, Team Patereau decided that it is a combination of things, number one being price. But other elements had to be just right, too.

On the residential listing in Gilroy the property had several things going for it in addition to price: location, decorating/showabality and curb appeal. We had worked with the sellers to get the home in showing condition, and the seller had worked very hard to do everything we recommended. The house is beautiful, and in general very showable. However, there was a need to de-clutter and de-personalize the home. We gave them almost the same advice that Kate Hart gave in her blog posting, “5 Things Buyers Should Never See in Your Listings.”

I can’t tell you how wonderful it is to get a client who takes our advice, but it’s even more gratifying when they have taken our advice and we actually get results from it in the form of an offer.

If you’re thinking of selling, or, as was the case for our client, if you're getting transferred and need to sell in a short timeframe, give Team Patereau a call. We’ll work with you to make your property the best it can be, and price it right to get action. Remember, homes get bought and sold even in slow markets.

Bad Pics, A Few More

I just can’t resist doing a few more bad real estate pictures - because they’re there.

Just to be clear, bad real estate pictures is not my original idea. Athol claims that right. That’s all right by me because she posts one picture a day, and there are just too many for her to keep up with. I won’t be doing a series, and I’ll try to make this my last post on the topic, but, as stated before, there are just too many, and new pictures are coming up all the time.

Hot Topic: Real Estate Listing Pictures

I had a new listing last week to get on the MLS, so I took some pictures. I get nervous about pictures because I’m not a photographer, so I run everything through a photo editor program and hope to get the best exposed and cropped piece of the house that I can. It turns out there are a lot of really bad real estate pictures posted around the internet. Once I discovered that, I looked with interest at the bad picture postings – and I’m very relieved to say that no Team Patereau photos were posted!

There’s a great blog posting about Rules for Real Estate Photography, and I think it is good information for me, an agent, as well as you – a seller/potential seller. If you’re a buyer/potential buyer, get what you can from the photos, but plan on visiting the home before you make your final decision.

The rules state that not every room is “photographable.” Bedrooms without any architectural interest, just square rooms with the seller’s furniture, don’t make good photo statements about the house. The only thing they show is what the seller has done with the room, and all that stuff is going to move with the seller.

Same goes for bathrooms, but even more so. However, the author, Athol, states in Rule Nine of Good Real Estate Photos, “Show that it’s not nasty.” Bathrooms are very difficult to photograph because they are small, confined rooms with great big mirrors to reflect the flash, or the reflection of the photographer with a camera in their face. If I can get around the mirror thing, I’ll put in a bathroom picture, but I have to say I really don’t like to do it. After I’ve got a good Front, Close-Up Front, Living Room, Dining Room, Family Room, Kitchen, Back, Another Back, possibly the Master Bedroom, and any Special Feature, then, and only then, will put in a Bathroom picture. But, I’ll never, and I mean never, put in a picture of a bathroom with the toilet lid up. It never ceases to shock me when I see an MLS picture of a bathroom with the toilet lid up.

Here are some bad pictures from currently "Active" Gilroy listings, in the specific category of my pet peeve, "Open Toilet Lid."

There were many more bad pictures, but I've spent enough time on this. I assure you that if you choose me for your agent, I will not post a bad picture. I will take plenty of them, I just won't post them.

STATS - You Know You Love Them

Our good friend Sam, at Chicago Title, keeps us abreast of real estate numbers in Gilroy. She sent me the following info:

• The good news is sales were up in May from April. The not so good news is inventory is continuing to climb.



• In South County, which includes Gilroy and Morgan Hill, we ended May with 34 sales of single family homes and 1 condo/town home sale in Gilroy and 40 single family homes and 10 condos/town homes in Morgan Hill sold.



• May ended with 411 listings of single family homes and 36 Condo/Town homes in Gilroy where Morgan Hill finished the month with 268 Single Family Homes and 32 Condo/Town home listings.



• The Average Days on the Market jumped in Gilroy for single family homes from 94 in April to 105 in May. Condo/town homes are at 72 days on the market for May with only 1 condo/town home sold in May and no condo/town home sales in April.
  


• Morgan Hill’s single family homes days on market decreased from 81 in April to 65 in May and Condo/town homes decreased from 132 days on market in April to 77 in May.



• Overall days on the market have decreased countywide. The closer to Silicon Valley the better the market conditions.
  

Here’s the complete report.

Intensely Local Market Indicators

As I was scanning/reading another real estate blog I came across an article at CNNMoney.com that addressed a big worry for every homeowner right now, “Has the real estate market hit bottom?”

The article states, “Because housing markets are intensely local, it won't do much good to check national figures. Instead, stay alert to leading indicators of recovery in your local market…”
The Indicators are:

1. Inventory is declining – That would mean that there are less houses currently on the market than there were last month, the month before, last year, etc. In Gilroy there aren’t.


2. Houses are selling faster than they used to – That would mean that the average “Days on the Market” number is lower for a category of property than it was last month, the month before, last year, etc. In Gilroy, it’s not.


3. Sellers are acting less desperate – That would mean they lowered the list price, they held open their house both Saturday and Sunday for several months straight, they paid closing costs, they did all inspections, all repairs, and paid HOA for up to a year. In Gilroy, the signs of desperation are growing, not decreasing.
   

I don’t have to tell you what that means, but I will: In Gilroy our market is not through “normalizing.”

Latest Listings in Gilroy, Wednesday Version

I looked with particular interest at the newest listings in Gilroy for the last few days. It just so happends that one of those new listings is by Team Patereau! We listed 1244 Blacksmith Drive. It's a great listing because it shows beautifully, screaming "Professionally Decorated!" and it's priced very aggressively. Those are the kinds of listings we all want nowadays.

Here's the rest of the crowd:

As always, if you or a friend or family member is interested in seeing any of these properties, please call Team Patereau.

Call Me

Friday is the day many people start to try to figure out how they are going to do all of the things they scheduled for the week-end. Let’s assume, because you are here, that you are not fully booked, and that your are, in fact, looking for real estate in Gilroy and trying to figure out what’s new on the market so you can take a look. There are two things you can do at this point:

1. Call me. I’ll talk to you about what you want and what you qualify for, and I’ll arrange a targeted, specific tour for you.


2. Check out the New Listings In Gilroy This Week Chart below. All of the newest listings in Gilroy for the last week are listed. There are 30-ish new listings! Your work is to eliminate the things you are not interested in, narrowing down the list. Once you have picked what you want, you need to go by and see the properties. Some of them will have Open House time either Saturday or Sunday. Which day are you going to drive around? Some won’t have Open House scheduled this week, but may have something in the future. If they are not going to be open you will need to make an appointment to see them. At this point you can call the listing agents and wait for their callbacks so that you can set an appointment for seeing that property, then move on to the next. OR, you could go back to Step 1 above.
   

Reminder: Buyers don’t pay for the services of a Real Estate Agent. The Seller pays the commission when the property sells.

As long as you don’t have to pay for the great service you receive from a Real Estate Agent, what’s keeping you from using one?

Apricots with Real Estate

Today is Thursday, and this week it’s my day off. Team Patereau (Rick and I) are headed over the mountain (Pacheco Pass) to visit my very best friend from high school, Sue, and her husband, Anthony, in Turlock. They have a place in the country and on it they have many fruit trees. This visit we are picking apricots. I look forward to eating fresh, tree-ripened, room-temperature apricots. We’re also going to get enough to take to our daughter to make apricot jam.

There are many recipes for apricots, and many more for apricot jams. Dorothy McNett is a local chef and her recipe for microwave apricot jam looks like one that I could do if I ever did apricot jam. (I’m pretty sure there’s a kitchen in my house, I’m just not sure where it is.)

Can’t think of a tie in: Apricots with Real Estate. Tomorrow’s another day.