Fact or Fiction in La Jolla’s Real Estate Market

As a La Jolla Realtor I am finding selling Real Estate in today’s current economic times can be a very challenging. When representing a seller, they are thinking “I am not going to give my house away, I’m not desperate to sell, or I’m in no hurry”.  If I’m representing the buyer, they are thinking “I’m going to offer at least 20% below the list price, the seller is desperate, or if I can’t get a bargain price on the house, I don’t want it”.  This situation becomes even more complicated when the seller you are representing becomes your buyer for another home all at the same time!  This is like working with a person who has a split personality and many times I find myself very frustrated just trying to get a house in escrow.

S0 here are the Facts and the Fiction in La Jolla’s real estate market.

 1.”Sellers are desperate, I can write a low offer and the sellers will accept it “.  Fiction!  If a house is priced right, it will sell.  However, not all sellers have to sell, they would just like too,; but if the price of the offer does not meet their expectations they won’t sell.   No matter what, a well priced home will sell regardless of the circumstances in any market.

2. “I can take my time. The house is not going anywhere fast” That may or may not be true. Remember that old saying known as “Murphy’s Law”?   Anything that can go wrong will go wrong.   Another true fact in Real Estate is a house can be on the market for long time seeing very little activity, but once one buyer is interested in it, all of a sudden there are a number of buyers who want the same house too.  So waiting is not a good option in today’s market.  I see this scenario happening more often now with home prices and interest rates at historic lows.

3.”Interest rates will stay low.” Fiction! Right now interest rates are currently low thanks to the federal government’s efforts to encourage a faster economic recovery.  If you wait for property values to go lower and interest rates rise, your buying power will also be lower. This will cause you to experience a net loss rather than a gain.

 4. I’ll write a “contingent offer” when I find a home I like and then I’ll sell my Home after I have an accepted offer.”  I know, you don’t  want to be homeless but in today’s market when buyers are competing with other buyers that don’t have that contingency this is not a good plan of action.  The contingent buyer generally loses out to the non-contingent buyer.  As a buyer you want to come from a position of strength but if your house is not sold before writing an offer your negotiating power is greatly reduced.

5. “I’ll buy a foreclosure and get a house real cheap” Not always True. Buying a foreclosure or REO (Real Estate Owned) has its own set of problems. Neighborhoods that are prevalent with foreclosures greatly reduce the surrounding homes values. If we are talking short sales, the actual closing of those homes can be months away from the time you wrote the offer. The possibility of being over bid before the bank makes a decision is high. With both scenarios, how you see the property, its current condition, is how you will buy it. Repairs are generally not done.

 6.“What do I have to lose with a writing a really low offer, I’ll get a counter offer?”   You might lose your dream home!  If the home is priced right and an offer comes in extremely low the seller has the right not to give a counter offer. Many sellers chose not too counter thinking they will never come to terms on an offer so off their list price. Recently I worked with a seller who had multiple offers and decided to take the highest one right on the spot and did not counter back to the other offers. One of the buyers who heard that told his agent he would have bid higher, but it was too late.  In today’s market if the property is priced right I recommend a buyer write his strongest offer first and not wait for a counter, because you might never get one.  Don’t assume anything!

 As the La Jolla housing market starts getting stronger and the housing inventories are shrinking being a buyer means you have to know the Facts and not rely on Fiction for a successful purchase of home. To miss out on your dream home because you believe in the Fictions of the housing market is a shame. When you find a home that meets the majority of your needs, be prepared to compromise some on the rest.  The La Jolla housing market may or may not be close to the bottom or home prices might turn around rapidly but no one has a crystal ball.  We won’t know till after the fact. Don’t miss your window of opportunity for home ownership.

 If you have any questions on buying or selling a house give me, Michelle Silverman, La Jolla Realtor, a call at 618-980-2738.  You can also visit my website, at www.LaJollaAreaHomes for more  Real Estate information and to do a property search.