Buyer's often ask the question "What should I offer?" before they find a specific house that they want to place an offer on. They want to know the formula for the list price verses the actual purchase price that they will pay. They ask questions like "If we shop in the $400,000 range, what price do you think we can get it for?" I always respond the same. It depends on the house and if it is priced correctly. How long has the house been on the market at this price? This is a more important question than, "How long has the house been on the market?"

Home owners don't have to price their home correctly, they just won't sell their house until they do. Maybe we should just call them Lister's. Unlike seller's, Lister's waste an agents time and inflate the price's of other Lister's.

Question's that I ask a home owner that says they want to sell is "Do you want to list your home, or sell it?" Do you want to be a lister or a seller? When do you want me to start telling you the truth?

Once I have explained to a buyer that selling prices are set by the market and not the sellers or their agent, I will let them know that sellers and their agents will list property (incorrectly) based upon other criteria. They will list based upon the debt on the property, what they paid, the improvements that they have done, the amount that their neighbor (a lister) has listed at, what they need or want to have to be able to fulfill their future plans etc. This is a mistake that will cost the Lister's money in the long run, if they ever sell.

Keep in mind that a lister is in charge of what price they will ask, but the buyer will decide how much the house will sell for. Lister's are different than seller's, because they don't need to sell.

We have a lot of Lister's in our current market. With 1207 homes on the market and only 51 closings in June, it appears that we have about 4% sellers and 96% Lister's.

One thing is for sure, you can sell your house if you are willing to price it correctly.

So, back to the question, "What should I offer?"

Once you have found that house you want to buy, the question really is, what is the current market value?

• Spend time looking at homes in the area that you want to buy.
• Have your agent show you recent comparable sales.
• Be reasonable based upon the information that you have collected.
• Ask your agent their opinion.
• Have your agent contact the seller/Lister's agent to see if there has been any activity previously that will help understand the seller's motivation.

Some good numbers to know in Big Bear

Year to date sales prices vs. list price / price differential.

Area Percentage #of sales

Big Bear Lake (West , Central and East) 80.58% 56

Moonridge 93.47% 61

Fox Farm 76.16% 25

Sugarloaf 92.27% 44

Fawnskin 92.38% 8

Big Bear City 97.11% 55

Erwin Lake 91.45% 26

Whispering Forest 94.85% 1

Baldwin Lake 96.39% 4

Worrying about what you pay, instead of what you get, is a mistake that will cost a seller thousands in the current Real Estate market.

• Pick a quality agent from a local brokerage and expect professional service.
• List with a discount brokerage and expect a discounted offer.
• Put a sign in your yard that says "I'm cheap" or "I'm desperate" and expect cheap buyers writing cheap offers.

Q. Is a Real Estate commission negotiable?

A. Yes. First let's look at the services being provided and the costs that are associated with them. We should talk about the commission that you are requesting and I will need to decide whether or not I am willing to work for the commission that you want to pay. It's a business decision for both of us.

Q. Should I increase the commission offered to the buyers agent?

A. No. The commission must be the same as other homes in the area and price range, and anything above that should be applied to a price reduction. Extra commissions are bonuses, but I can't sell a house because it pays me more.

Q. Will you list my house for a lower commission?

A. Yes. The commission is negotiable. If we set the price well below market value to reduce the costs associated with marketing the house. Most seller's would benefit from listing closer to market value and paying the extra commission.

Q. What if you list the house and sell it, will you take less?

A. No. If we are lucky enough for this to happen Mr. Seller, you win. If I bring a qualified buyer to your house and we have the luxury of having the agent the knows the house the best show it, you win. If I can tell them why it is worth the list price and show them the comparables that where used to establish the list price, you win.

Q. What is more important, the price or the commission?

A. The Price. Don't make the mistake of focusing on commission when listing your house. Pricing your home correctly is the single most important factor in determining when or if your home sells.

If you are a seller and your first concern is the commission (big red flag) , you will start out with the wrong agent and end up with less money in your pocket. Experienced agents want to help you get the most they can for your property and just want a fair commission from the close of the deal.

Seller's that allow their agent to guide them through the sales process will benefit. Successful Real Estate agents in today's market bring local knowledge and transaction skills that net sellers more and provide smooth timely closings. If you want less service and less knowledge, go with a discount service, and expect to get what you pay for.

Steve Hirschler

Often buyers have asked me this question, so I thought I would write a post on this subject.

In California a good faith deposit is given at the time an offer is made. A good faith deposit will show a seller that you are a serious buyer, and building the seller's trust is important. A deposit paid by a buyer to a seller to demonstrate intention to complete the purchase. also called earnest money. While good faith deposits can be as little as one dollar, I recommend a 3% good faith deposit. When I review an offer for a seller, the good faith deposit gives me an idea as to the strength of the buyer, and a weak deposit sends up a red flag. The good faith deposit is held in the escrow. The liquidated damage clause (if initialed by both the buyer and seller) states that if the buyer fails to complete the purchase because of buyer default, the seller shall retain the good faith deposit not to exceed 3%. If the liquidated damages are not initialed and the buyer breaches the contract, the seller could sue for more than the 3% if the sller can prove default by the buyer. Contingencies must be removed in writing before a buyer is in default. If the buyer has not removed their contingencies and has stated one of the contingencies as their reason for not performing, the seller is not entitled to retain the good faith deposit. If you want to get the sellers attention, and purchase the property at the best price, the good faith deposit can help. Weak good faith deposits tell the seller that you may be a buyer that is not qualified, lacking funds to close, or fishing on a number of different properties. The good faith deposit will be applied to the down payment and closing costs at the close of escrow.

Down payments are paid as final funds at the close of escrow. Depending on the loan amount down payments can be any amount. Obviously the larger a down payment the stronger the offer. All cash offers are the strongest offers, but a well qualified buyer with a strong down payment of 20% are welcomed by most sellers and lenders. With new lender requirements a strong down payment helps reduce the risk for the lender by creating equity in the property and decreasing the loan to value equation.

If you would like to discuss Big Bear Real Estate , please give me a call.

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

Many consumers are unclear with some of the terms in today's Real Estate market.

"REO" (Real estate owned) is property that the bank acquires through foreclosure. The bank has already had an auction on the property and did not find a buyer. Currently REO properties are abundant in most California markets. These homes are often priced well and represent some of the best values.

REO's are far easier transactions than short sale properties. REO escrows are often completed in 30 days or less.

One problem the banks are having with properties in the Big Bear area is our member only MLS (Multiple Listing Service) access. Many local Realtors only see the properties that are listed in the Big Bear MLS and are unaware of REO properties that are listed in other areas. It really is a disservice to the bank that owns the property to not have the home listed in the local MLS. Access to these properties is sometimes difficult for local agents, because it can be difficult to connect with the agent that is out of the area to get the showing instructions.

One solution that works well in this situation is for the out of the area listing agent to team up with a local agent that is available and knowledgeable in the Big Bear Real Estate market.

Most bank owned properties have an addendum that is presented to the buyer as a counter offer. Usually the addendum reduces the contingency period for buyers inspections to 5 - 7 days. Most bank owned REO properties are sold "AS IS". Buyers that need a loan to purchase a Bank owned REO may be required to pre-qualify with the bank that is selling the property.

Just because a property is a REO doesn't make it a deal. Most are, but you still need to do the research and establish value. Some hit the market and have multiple offers in the first week, while others just sit. It is the same old story, pricing is the most important thing your Big Bear Real Estate agent can do to help make the sale.

First impressions are everything, so I would think that a little cleanup would benefit the seller (bank). having the utilities on and the yard cleaned up of debris will help a buyer see the potential of the property. I see quite a few of these properties that are literally trashed and no attempt is being made to do any cleanup. Without power or water it is difficult for the buyers to inspect the property.

Recently, I got a copy of an addendum on a bank owned property that states that the buyer will be responsible to pay for all aspects of the transaction and the selection of services. I told my buyer that we would just need to reduce our offer to accommodate these fees.

On another recent transaction with a bank owned property the bank chose the escrow company and selected a company that is 2 hours away from the property. I think that the banks are selling off the escrow rights to all of their properties in bulk. This nets the escrow and title company a predetermined / negotiated fee for each property and reduces service levels. The escrow company is very busy and doesn't seem to push things along, the bank has a Per Diem charge daily to the buyer if we don't close on time.

If you are looking at bank owned properties or short sale properties in Big Bear, be prepared to exercise patients once you find the property that you want to make an offer on.

Opportunities are abundant, but don't try to bring an out of the area agent to a location like Big Bear and expect to get the best deal or knowledge of the area. The Tim Wood Group sells Big Bear and we know the inventory and the Real Estate market that we work.

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

Sold year to date in Baldwin Lake, Big Bear City, Big Bear Lake Central, Big Bear Lake East, Big Bear Lake West, Erwin Lake, Fawnskin, Fox Farm, Lake Williams, Moonridge, Sugarloaf, and Whispering Forest.

QUICK FACTS

• Closed residential sales in 2008 for Big Bear Valley. 210 sold YTD as of 5/27/2008.
• Average list to sold price is 95%.
• Average days on the market 140.
• There are 105 pending (in escrow) and 1188 active listings.
• The top 3 highest price sales YTD have had representation by Coldwell Banker Mountain Gallery Realtors / The Tim Wood Group.

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

A simple description of a short sale is a home that is on the market for less than the debt owed to the lender. The seller is hoping that the bank(s) will accept less than the note(s) and allow the seller to be forgiven the difference between the note and the sales price.

When the seller accepts a short sale offer, the sale is contingent on the approval of the bank that holds the note. At this point the home should show a pending status in the MLS since it has an accepted offer. The bank doesn't own the home, they approve the sale and accept the loss on the note or they don't approve and the seller can cancel the escrow because of the short sale contingency. Often a response from the bank can take 40 - 60 days. This can be very frustrating for a buyer and their agent.

Buyer's should be cautioned not to make multiple short sale offers once they have an accepted offer. If a seller approves the offer, technically you have opened an escrow in California and have a binding contract. That is why the contract reads California Residential Purchase Agreement and Joint Escrow Instructions. Placing additional offers on other properties while waiting for the bank approval is not recommended.

Sellers that want to sell a home in a short sale situation should start negotiations with the bank holding the note(s) prior to getting an offer / as early as possible. Good comunication with the lender will be crucial to a successful short sale.

Below is a set of paperwork that I give to my sellers that might need a short sale:

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Preparation and communication are critical to the success of your short sale transaction.

Regards,

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

Big Bear Lake is near full and a great place to visit and get out of the summer heat. We have cabins in Big Bear starting under $200,000. I can show you any home in Big Bear regardless of the listing agents. For a free search of the Big Bear MLS listings with no obligation, just click here Big Bear MLS search

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

In April Big Bear's Moonridge area was the highest price per square foot sold in all of San Bernardino County and Big Bear Lake is in the second slot. Big Bear's beautiful lake and pleasant weather continue to draw visitors consistently through the summer months.

If you know anyone that is looking to buy or sell Real Estate in the Big Bear area, please give me a call.

Regards,

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com

This is the latest information for deed recording activity in the Big Bear area. As you can see, the number of recordings is still well below the 10year average. Year to date we are 37% below 2007 recordings and 58% below 2006. While we have seen a slight increase in April over January Februray and March 2008 numbers, we still can't say that the market has improved. Traditionally April is busier than the first three months of the year, so a slight increase in transactions is to be expected. According to the Big Bear MLS 50 of the 65 deed recordings were residential, and 6 were vacant land. There was one condo sold in April, 2 commercial, and one business. If you would like to discuss Real Estate in Big Bear, please give me a call.

Regards,

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com/

It seems sellers want to use every type of method to price their home except the market conditions. You might as well sit down and play spin the bottle.

The other players at the table are:

I owe this much. (Check out my new car and boat)

I want this much. ( I think you can sell a Yugo for $50,000 if you run an ad on the Superbowl)

I need this much. (Buyers care how much I need)

I don't really need to sell. ( I just want to waste your time and money)

My brother is an agent in another state and he said its worth .... (and he knows more about this market than you do)

The house across the street is priced at ......(it's been on the market for 2 years with no offers)

Pricing your home with any method other than market conditions and comparable sales will result in loosing the shirt off your back, your socks and possibly your shorts.

If you are looking to sell in Big Bear, pricing your property correctly is the single most important thing your agent can help you with.

Steve Hirschler

Associate, The Tim Wood Group

Coldwell Banker Mountain Gallery

42153 Big Bear Blvd.

P.O. BOX 6820

Big Bear Lake, CA 92315

steve@bigbeargallery.com

909 866-3481 EXT. 217 CELL 909 725-5889

Fax 909 866-3531

http://www.stevesellsbigbear.com