The global COVID-19 pandemic has affected life across the globe. Strict social distancing measures, school closures, and, in many locales, a ban on all non-essential businesses have turned people’s lives upside down and thrust us into a surreal existence where we’re spending nearly all of our time at home.
From a real estate perspective, it would be disingenuous to say that nothing has changed. Great agents are honest at all times, even (especially) when it’s difficult.
That said, there’s no indication that we’re in (or headed toward) a housing crisis like the once-in-a-century 2008 collapse. And, by all accounts, the fundamentals of the housing market remain in place, despite the safety precautions enforced by health and government officials.
The following list may help you better understand what’s changed and what hasn’t in the world of real estate
What Has Changed:
1. Access to Showings
In many places, the process of showing a home has changed. Some states have put limits on the number of people allowed to gather in one place, which has impacted open houses. Additionally, sellers, buyers, and agents are taking more precautions to keep themselves safe, with more cleaning, access to protective gear, and enforced distancing measures becoming the norm. Digital-only showings are also growing in popularity, although they’re still relatively new. The good news is I work with mostly out of town buyers so I have plenty of experience showing property in creative ways….including FaceTime and video. It is pretty easy here since the majority of properties are vacant right now. So, if there’s a home you’re interested in seeing, it’s still possible to make it happen.
2. The Closing Process
Much of the work that needs to be done between going under contract to sell or buy a house and the closing can be done remotely and electronically. But there are many things that need to be done by many people throughout the process. From the mortgage, to the title work, to inspections and appraisals, getting to the closing table depends upon a lot of people doing their job. Social distancing and working entirely remotely has a certain learning curve while everyone involved figures out how to get their end of things done. So, the process may take at least a little longer, and change as everyone figures out the best way to handle things. The upshot to this is that it could create better, more efficient ways of doing things moving forward.
3. Some Mortgage Products
Perhaps the most impactful changes in the real estate industry are happening in the mortgage market. The conditions on certain products are being tightened, and some lenders are temporarily exiting the market altogether. Jumbo loans (a type of financing where the loan amount is higher than the conforming loan limits set by the Federal Housing Finance Agency) seem to be feeling the most impact, while conventional loans, which are considered less risky, have been less affected. If you have questions about getting pre-approved, you should contact a mortgage professional who can help you better understand your options. I like working with lenders who have experience in our market, so reach out if you would like me to put you in touch.
What Hasn’t Changed:
1. People’s Dreams
Even when the whole world comes to a stop, our hearts and minds do not. We all have dreams, whether it’s owning a ski in/ski out condo in Mammoth Lakes, a gorgeous custom home in Crowley Lake or a starter home in June Lake. A pandemic doesn’t change that, even though it can help put things in perspective and remind us of what matters most. But don’t let the strange times we’re in stop you from daydreaming and working toward those dreams. A pandemic is temporary; our hopes are not.
2. Housing Demand
There’s been a well-documented housing shortage for years, and there’s no indication that the fundamentals have yet changed. That said, every real estate market is unique, and what holds true on a macro-level may not hold true in your desired market. Regardless of the specific market and overall demand in that area, people always need homes, despite a pandemic. People still want vacation/second homes. So, if you want to sell, there’s likely a buyer for your home. And if you want to buy, there’s likely a seller who’d love to sell. The time it takes to find or sell the property just might take a little longer right now.
3. My Desire to Help
Most agents eat, breathe, and sleep real estate, and aside from looking out for our loved ones and wishing for a healthy and safe resolution to this mess, that hasn’t changed. I want to help you with your real estate needs because I am passionate about what I do, and it’s likely that our newfound home-time has coincided with a lot more real estate research than it has with cleaning or learning how to play the guitar.
It is human nature to want to get the best deal so I’m not surprised when new clients ask this question. My advice is not try and time the purchase to get a better price. Often buyers think they will get a better deal on a home in the off or shoulder season. But generally speaking, sellers are savvy and home values do not fluctuate by season. The best time to buy a property is when you find the property you want.
Know what you want and be prepared to take action. You have to be confident you understand where the market is and what you want out of your property. What is your budget? When will you be using the property? Will you be renting?
When you do find the property you want, I recommend you request photos of the property taken during different seasons. You really need to see the difference between summer and winter. Where does the snow accumulate? How is your view impacted by the snow or trees during the summer versus the winter?
Trying to time the real estate market is not recommended but do watch for trends. It doesn’t matter if you buy the “deal of the century” if it is not something that matches your goals. Prices were relatively flat in 2012 but we have seen an increase in 2013. Historically Mammoth Lakes has followed the trends in San Diego and Orange County by 6-8 months. In those markets they are currently seeing multiple offers and properties are selling for over the asking price. The median days on market is decreasing in Mammoth Lakes.
In summary, be prepared:
- Know your budget.
- Identify your goals for the property
- Know which area of town you want to buy.
- If financing, get preapproved.
- Establish a relationship with a real estate agent and communicate the info above.
A trustworthy real estate agent will help you understand the market and help you find the property that matches your goals.
For past articles, visit www.sonjabush.com
One of the most interesting things about showing property in Mammoth Lakes is I can show several different condos in the same complex and get drastically different feedback from the same potential buyers.
This past weekend was a good example. I took my client to see three different condos in the same complex. He wanted to see for himself why the price was so different when the floor plans and views were exactly the same.
The answer boiled down to four key areas:
1. Carpet: It is nice if the carpet is new but if it is not new, is it at least clean? Even though it is easy to clean, a dirty carpet leaves a nasty first impression.
2. Paint: When you enter the front door are the walls scuffed and paint chipped? If you are going to paint before selling, consider a neutral clean palette. The first 30 seconds in the property is important — paint can help make a good first impression.
3. Clutter: Should go without saying but buyers want to visualize the place as their own. All the ski gear, knick-knacks and items you will be taking when you sell, should be out of sight. Since most places are sold furnished in Mammoth Lakes, buyers can get a real sense of what it will be like for them when all the clutter is gone.
4. Kitchen: This is a costlier issue than paint, carpet and clutter but a necessary fix if someone really wants to sell. A total remodel is not necessary. Something as inexpensive as new kitchen cabinet hardware and light fixtures all the way to costlier new appliances will help you sell your property. Even a dated formica kitchen with dark wood cabinets looks better with new hardware. Consider a new faucet, painting the cabinets and upgrading appliances for a real boost.
Granted there are some buyers who want a “fixer” but most want a turn-key property. They want to buy it and enjoy it.
Ask your real estate agent for input. Better yet, ask them to show you a property similar to yours that has made some of these improvements so you can get some fresh ideas m
For previous articles visit www.sonjabush.com
According to real estate mogul Barbara Corcoran (you might know her from Shark Tank) if you are in the position to consider making a down payment on another property, now’s the time to do it. According to Corcoran, “It’s the smartest thing you can do right now,” adding that the second-home market is “the last area you can still get a steal of a deal.” But if you’re thinking of taking the plunge, Corcoran advises you act fast. “In the second home market, the homes are abundant but starting to shrink up.” As for Mammoth Lakes specifically, inventory levels are extremely low for both condos and single family homes.
If you decide to make a second home purchase, be sure and avoid some of the biggest mistakes made by second home buyers.
Buying Where Your Friends Live: Too often, Corcoran says, people fantasize about vacationing with or near friends and end up making a purchase that isn’t right for them.
Not Having a Budget: Set a budget and stick with it. “Look over your budget,” Corcoran says. She also adds that it’s a smart move to make a low bid on a property that is out of your price range, especially if it has been languishing on the market for months. “People who have the nicest homes always overprice, and it just sits on the market,” she adds.
Focusing on the Wrong Amenities: Don’t buy into a community because of its amenities. If you’re not a tennis player now, you won’t become one because your new development has a court. “Most people generally won’t use the extra stuff and they get blinded by all of that,” Cochran explains.
For previous articles, visit www.sonjabush.com
For more information on Ms. Corcoran, visit www.BarbaraCorcoran.com
There are distressed sales in almost every market. Before we look at Mammoth Lakes specifically, it is important to understand the definition of distressed sale.
A distressed sale in real estate is defined as the urgent need to sell property when the owner can no longer make the mortgage payments. He/she must sell the property immediately to pay off the mortgage, even if it involves losing money on the property. There are two primary types of distressed sales:
Foreclosure: A situation in which a mortgage lender takes possession of the property because the borrower has not made payments on interest or principal for a certain period of time.
Short Sale: An agreement between a mortgage borrower in distress and the lender that allows the borrower to sell the house and remit the proceeds to the lender. A short sale is an alternative to foreclosure or a deed in lieu of foreclosure.
Foreclosure-related sales are on the decline but distressed sales continue to claim a “disproportionately high portion” of total home sales across the country, according to RealtyTrac’s most recent foreclosure and short sales report. The firm also found increases in prices for distressed properties in 2012.
Distressed property sales made up 43 percent of all home sales nationwide in 2012, according to RealtyTrac. Foreclosure-related sales made up 21 percent of all sales, while non-foreclosure short sales made up 22 percent of sales. Together, foreclosure and REO sales decreased 6 percent from 2011 with a total of 947,995 sales over the year in 2012.
Here in Mammoth Lakes, in 2012 distressed property sales made up 41 percent of all home sales. Foreclosure sales made up 15 percent of all sales and short sales were 26 percent.
A qualified licensed real estate agent can provide information on available distressed sales. Often the lender has special requirements for buyers and although there are some “good deals,” patience is a virtue when dealing with distressed sales.
For previous articles, visit www.sonjabush.com
We all know houses are not selling like they used to. If you are considering selling your home, there are several tips that will make it easier to sell. First impressions make a huge difference between a sale or no sale. These tips apply to any economy or market.
- Less is More: Even if you have not moved out, removing some furniture can help the home feel more spacious. This also provides a potential buyer with a better visual of how the property could look as their home.
- Odor Control: Sometimes homes have an odor you may not even notice since you there every day. Ask a friend (or your agent) to be honest about any odor. While the house is on the market, take the trash out every day and clean the refrigerator regularly. If you have pets, keep an eye on the situation (i.e. litter box). I have been in some gorgeous homes but a strong offensive odor has turned buyers away.
- The Little Things: There are small and often inexpensive changes you can complete yourself to freshen up your home. For example, replace dated/cracked light switch covers , install new hardware on cabinets, remove broken window treatment (no window covering is often better than broken blinds). Although potential buyers know the house is lived it, it is helpful to remove excess clutter such as newspapers, mail, laundry and shoes.
- A Neutral Appeal: If you have customized every room with dark paint or wall paper, you may want to update the colors to a more neutral tone. This can help potential buyers create their own vision for the home and also when they are comparing their options, your home may need less investment and work if they buy the house.
- Curb Appeal: This one is pretty obvious to most but again look at the exterior of your home from the potential buyers’ perspective. Is the home welcoming? Is there a clear path to the front door? Is the front porch clean and appealing?
Keep these tips in mind when selling your property. The best way to do this is to walk through your home with an honest friend as if you are both touring the home for the first time. An experience real estate agent can also help.
For previous articles, visit www.sonjabush.com
Fractional ownership offers individuals the opportunity to buy partial ownership of generally high-end properties in resort areas (golf course, ski area or beach communities). Usually the fractional ownerships are divided into fourths, sixths or eighths, with each owner having an equal number of days a year to use the unit.
At first glance it looks and sounds like a time share. The main distinction between timeshare and fractional ownership is with a timeshare you buy the right to use a certain period of time (not usually flexible), but with fractional ownership you are buying real estate with more usage available and increased flexibility on scheduling. You get a deeded piece of luxury real estate which you can sell, transfer or trade like regular real estate. That being said, the cost of fractional ownership is higher than that of typical timeshare, though still much less expensive than whole ownership of a luxury home in the same location.
Depending on the property, most fractional developments provide the amenities of a first-class hotel such as concierge, housekeeping, ground transportation and grocery shopping services. Fractional properties may be hotel suites, cabins, town houses or detached homes. By only paying for a fraction of a luxury property, fractional ownership can be a much more cost-effective way to stay in desirable properties and locations.
In Mammoth Lakes there are two luxury fractional opportunities. 80|50 offers fractional ownership in one, two or three bedroom elegant condos with Gondola access, while Tallus offers fractional ownership in 5000 sq foot luxury homes located on Sierra Star Golf Course.
Fractional ownership is not right for everyone. The family that wants to come to Mammoth every other weekend or an entire month in the summer should consider full ownership properties. However, the family looking for 4-8 weeks per year in a high-end property offering both onsite and offsite amenities should consider fractional. A qualified real estate can help you determine if fractional ownership is right for you.
For previous articles visit: www.sonjabush.com
What happens when you receive multiple offers on your property? Should you accept the highest offer?
This is a great question and I recently faced the same dilemma myself. Last week, my husband and I listed personal property for sale and the same day we had five offers! All the offers were over the asking price and we were tempted to go with the highest price. The offers ranged from $1,000 over asking price all the way to $25,000 over asking. Sounds like an easy decision, right? Not so fast. After careful review it became apparent the highest offer was not the most favorable offer.
All the offers were contingent on the buyer obtaining financing. Three of the offers had “pre-approval” letters and the other two had “pre-qualify” letters. (Note: pre-approval is further along in the process than “pre-qualify”). One of the pre-approval offers was going to pay 50% cash and finance the rest. When buyers are obtaining a loan that means an appraisal is going to be required by the lender. The first question was what would the appraisal be? Although we didn’t know for sure, we did know what the comparable sales were for the last 6 months as well as the current listings. With this knowledge, we guessed the appraisal would come in a little under asking price. Assuming that was the case, how much out of pocket were the buyers willing/able to come? After speaking with the other agents, it was obvious only one seller could come out of pocket for the difference. This was not the highest bidder but the 3rd highest. The highest bidder was only willing to come out of pocket an additional $10,000. After quick math that took their actual offer below the bid we accepted.
If we would have jumped at the highest offer we could have seen the deal fall apart in escrow. At that point the other buyers may have moved on to another property and we would have to start all over. Worse, the deal could be held up in escrow.
In summary, a qualified agent and solid information can help you make an educated decision when reviewing multiple offers. The highest offer is not always the most favorable.
For previous articles, visit www.sonjabush.com
Myth #1: The homeowner must have missed mortgage payments in order to qualify for a short sale.
FACT: Years ago this may have been true, but not in 2012.
A financial hardship should exist or be imminent. But, not all people with financial hardships have missed a mortgage payment. Common hardships include mortgage rate adjustments, loss of job or income, health or medical issues, and divorce among others.
Myth #2: Banks prefer foreclosure to processing a short sale.
FACT: The truth is that banks would prefer NOT to foreclose on a property because it costs them big bucks. The bank will lose a lot less on a short sale than on a foreclosure.
In fact, many banks are so interested in short sales that they are paying sellers to participate in a short sale versus letting the home go to foreclosure.
Myth #3: In order to the seller to qualify for a short sale, he or she must speak with the lender first and get pre-approved.
FACT: While each lender has a different way in which they process the short sale, overall the best way to get in front of a tough situation is to speak with a knowledgeable agent that knows how each short sale lender operates. Often, when calling the lender, short sale sellers find that they do not get the answers that they want and need from the first line of short sale support.
Myth #4: Short sales don’t close.
FACT: The truth is that about 50% of all nationwide real estate transactions right now involve distressed properties.
Myth #5: Short sales take months (and months) to close.
FACT: It can take months to close if you don’t know “rules of the road.” The short sale process must be mastered and it helps quite a bit to know the ins and outs at each of the major lending institutions. There are many short sales that can be approved in a much quicker time frame. The more liens on title, then the more lengthy the short sale process. A qualified real estate professional can help navigate the process.
Source: Short Sale Expeditor
There is no law that says you need a Realtor to sell your property in California. That being said, real estate is a complex transaction involving the sale of what is very likely one of the most valuable assets you own. The legal requirements involved in buying and selling property in California have become increasingly complex in the past several years. An active licensed Realtor is trained in these areas.
The top 5 reasons to hire a licensed professional Realtor:
1. Education & Experience: You don’t need to know everything about buying and selling real estate if you hire a professional who does.
2. Realtors are Buffers: Realtors do the screening for your showings and visits. If you are selling, they will make sure and keep the “lookers” at bay and encourage the serious buyers to make an offer.
3. Price Guidance: A Realtor will help guide clients on the selecting prices for sellers and buyers. They are experts in the local market. Based on market supply, demand and the conditions, the Realtor will devise a negotiation strategy.
4. Negotiation Skills & Confidentiality: Top producing Realtors negotiate well because, unlike most buyers and sellers, they can remove themselves from the emotional aspects of the transaction and because they are skilled.
5. Handling Volumes of Paperwork: Purchase agreements run 10+ pages. That does not include the federal, state and local disclosures. Most real estate files average thicknesses from one to three inches of paper. One tiny mistake or omission could land you in court or cost you thousands.