Original post made
on Jun 29, 2008
Jim Lavey has seen it all. A Realtor for the last 35 years in Pleasanton where he has lived since 1959, he has represented hundreds of buyers and sellers in good times and bad. Lavey, who is affiliated with Allied Brokers Real Estate, said that while these are not the worst of times--such as we saw during the dot-com bust or in the early 1980s when mortgage interest rates hit 20 percent and higher--these are not good times in real estate either, especially for sellers.
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posted Friday, June 27, 2008, 12:00 AM
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Posted by Objective view
a resident of Vintage Hills Elementary School
on Jul 30, 2008 at 6:05 pm
As a resident of Pleasanton, I do want to believe that housing values are stable. However, when surrounding communities decline in value, it also weighs on pricing in quality communities. There are over 50 notice of defaults in Pleasanton. Many of these are as a result of purchases from the 2004-2006 timeframe. If you search Lavey in the archives, you will find an article about the real estate market in 2004. Examples of $100,000 price increases occurring literally overnight. Those are the jumps in value that are not sustainable in a market. In today's market, when you see a similar home, selling for $100,000 less 2 doors away, a seller can't expect a bank to appraise and lend to a new buyer without that buyer covering the $100,000 with his own cash. In fact, reputable lenders are requiring 20-25% down on homes in the current market, and show cash available after close of 6 months of payment. That is a lot of cash. Homes do fall out of escrow do to appraisal contingencies, even in Pleasanton. The facts are that in the past, 2004-2006, you could buy a home that jumped in value by $100K overnight, by obtaining a loan from a lender for 100% of the value, showing no income documentation. That type of purchasing, buy unqualified buyers, edging out qualified buyers on overpriced property, is what gives us the false sense of value. It is very difficult to let go of a high value on a home in your mind. The bottom line, if you need to sell your home in this market, lower the price. If you are interviewing realtors to sell your home, ask when the last time they sold a home was? If they haven't sold a home this year, 2008, what make you think they can sell yours? For the majority of real estate agents, the last home they sold was in a market where you put up a sign, and sorted thru offer letters, each higher than the last. Those days are long gone, those lenders are broke, and those homeowners are struggling to pay their mortgages in every community. Look at realtytrac.com if you need further evidence. If you go to zillow.com, enter in a home address, look at the 10 year value chart. The appreciation you see as a mountain after a slow steady climb, from 2004-2006 does not exist any longer. Take a look at the 2003 to 2004 estimate, that most closely reflects the value of your home today. If you have to sell, don't make the mistake of hiring a real estate agent with limited experience, or one from out of the area. You will end up riding the market down, like those who have been on the market for the last 90-120 days. Houses don't sell for too cheap, if you price too low, you will get multiple offers, even in this market. If you get multiple offers on your home, and they are all 10-15 percent below your current asking price, guess what, that is closer to the real value of your home than your asking price. Don't rely on a friend with "some real estate background" for real estate advice. If you don't believe your agent, ask to speak with his/her broker. The broker has years of experience. Hire a real estate agent with 10-20 years of experience as a full time real estate agent. That will guarantee they know how to sell a home in any market.