It's Not a Buyer's Market! DUH!

The Los Angeles Times reported recently that here in Los Angeles County it is no longer a buyer's market. DUH! It doesn't take a mental giant to figure that one out.

For those of us in the real estate and mortgage industry here in L.A. County we already knew that and we've been telling our clients and buyers so for months regardless of what the media has been telling them or what they're reading on the internet.

While all of us (Realtors & mortgage professionals) know that real estate is hyper local and no two markets are the same, it can be really challenging trying to get that point across to our clients, especially when we're up against the media screaming about all the sellers who are so desperate to sell and all those friends and family members bragging about the "great deals" they just got. You know those people, the ones who know everything there is to know about real estate and mortgage loans and definitely knows more than any of us even though they have never worked in either the real estate or the mortgage industry and we have years and years of experience in the industry.

According to the Los Angeles Times, even here in Los Angeles County, no two markets are the same. Just because your cousin Joey bought a 4bd, 2.5ba, 2,100 sq. ft. pool home out in Palmdale for 200k with no competition doesn't mean you're going to get that comparable size home here in Sherman Oaks for the same price. NOT A CHANCE IN THE WORLD!

For starters, that Sherman Oaks home is going to cost you more than twice as much and you are probably going to have to compete with somewhere around, oh probably, a couple dozen other offers. While prices are not as high as they were at the market's peak, they are also not as low as the media has been spewing.

For those prospective buyers who think they're going to get that fabulous looking house in Valley Village for 20% less than list price. NOT IN THIS CENTURY! With an offer of at least 100k above list, you just might have a shot of at least getting your offer even looked at and considered. For many of my frustrated and fed-up buyers, I'm not sure what irritates them more, listing agents who intentionally list property low simply to generate bidding wars or the national media's talking bobble heads who don't have a clue what is happening here in Los Angeles County.

The L.A. Times relays a story of a 1950's, 1,600 sq. ft., fixer-upper in La Crescenta listed for 299k. On the morning the property was listed, there were 40+ people at the home viewing it. Shortly thereafter, 80 offers were received on the property, 15 were at more than 400k. The home sold for 480k.

The L.A. Times also predicts that banks are keeping prices artificially high! OH MY MY! WHAT A SHOCKER! PULLLEEEAAASSS! They know exactly what they're doing. By not glutting the market with all the foreclosures that they're sitting on, they can prevent prices from dropping anymore and can actually drive the prices up.

It has been all to disheartening for those that thought they could enter the market and in a matter of weeks find this fantastic home at a rock bottom price and realize several months later that it's all an illusion and their situation is absolutely hopeless. So what is the hopelessly anxious and ever optimistic prospective buyer supposed to do in a market like this?

Listen to your buyer's agent when they run the comps for the area and suggest that you make a fair market price for that really low priced, less than dumpy and not too dated property not too far out from that really nice neighborhood that you like.

When your agent tells you that the property is dubiously priced too low (around here listing prices are simply suggested prices), that means that it is not going to sell for list price and you will need to offer more than list price to even get your offer considered. When they tell you to offer 100k more because the comps warrant that kind of price, just do it! If they've done their homework, they know what they're talking about.

When they tell you that a property that you would like just came on the market, make every effort possible to see the property as soon as you can. If you like the house, make an offer now!

Don't wait a week to think about, don't wait another week to go and see it again just to make sure and don't wait until you talk to everyone you know about what you should offer. If you do, you will be too late because dozens of other smarter and more motivated buyers will have already beaten you to it.

Around here, it's this type of aggressive tactics and strategy that will get you into a home sooner rather than later. If you are a first time buyer who wants to take advantage of the $8,000 tax credit before November 30, 2009, then quit screwing around making foolish low ball offers on half way decent properties just because you want to try and get a "GREAT DEAL"! With that particular line of strategy, the great deals will end up being for the other person who made a better offer than yours and got the house instead of you. The "GREAT DEAL" will be the house you get now and not next year because you screwed around to long and missed out on all the great deals everyone else got.