Many buyers are finding it difficult to purchase a home because they get outbid by numerous other buyers wanting the same home. This trend is increasing dramatically in Los Angeles below the $400,000 price range.
An article at the L.A. Times documents what many dismayed home buyers are experiencing which is opposite of what you hear in most of the major news stations- that the market is still on a downturn.
Being in this industry FULL time (100+ hours a week) allows me to truly immerse myself in the market statistics to reveal a more realistic picture for my clients. When they ask me if we can find a home at 50% off, I explain to them that most homes for sale are already 50% of what they were 4 years ago...then I show them the statistics to prove this point.
When looking for homes to purchase, your best strategy is to be realistic about MARKET CONDITIONS and MARKET COMPARABLES. This industry used to be driven by sellers about 4 years ago- now it's driven by APPRAISALS. If you want to purchase a home of your dreams, you NEED to know what it will appraises for so you
1) Can understand if the listing is below market value- at which point it will have multiple offers.
2) Can be sure that your offer doesn't go over appraised value- at which point your loan will not fund unless you bring in the monetary difference between what the appraisal stated and the asking price.
3) Keep your feet on the ground so you don't get caught in the hype of bidding wars.
Below is a link to the article in the L.A. Times.
I hope this article helps you get into the home you truly desire!
Paul Aragon was voted one of the top realtors in all of Los Angeles County by the 2008 Daily News Reader's Choice Awards.
He gladly gives free advice on real estate transactions, contracts, and negotiating the best deal. He can be reached a www.AragonEstates.com or at Paul@AragonEstates.com
I had known a client for 2 years and had shown him properties way back when the dinosaurs roamed the earth (pre-mortgage meltdown). Life took a turn and he decided not to buy at that time, but I kept in contact with him through emails and postcards.
After stepping out of his time capsule and the influences of the news media, he decided to go through the process again. We made offers on seven homes and lost out to the properties due to multiple offer situations (every offer was above asking price.) The eighth was a charm and we entered escrow 37 days ago.
Through the whole transaction, he kept asking, "When is the $h!t going to hit the fan. We've been moving smoothly and I have friends warning me that my realtor must be lying to me because every transaction has problems."
I told him that the reason we didn't get into the other 7 properties was simple- it was not meant to be...
- We had a budget we wouldn't go over
- We never countered with more than we could afford AND no more than the house would appraise at
- We had home specifications we absolutely needed
- We had neighborhood considerations we needed
- We had an FHA loan that wouldn't fund if there were items missing in the house
- We got DU approval on the loan BEFORE we made any of our offers
- We submitted ALL tax information, employment information (including phone number of human resources departments for verification of employment)
Plain and simple, we had all our ducks in a row. I told him, "It's because you trusted my judgement and direction which brings us to the close of our escrow today. You knew it would be a journey which required active participation on your part- I drilled that into you before we even stepped into the first house."
If only all our clients were this cooperative, they would come to the same conclusion of their journey...a smooth and stress free closing.
To all those realtors out there- stand firm in the requirements that you know will be in your client's best interest...even if their friends tell them otherwise!
Here's a link to a chart that shows September's ACTUAL statistics for the Local Real Estate Market. These are the graphs that the news media doesn't want you to have. Why? because they go contrary to the negative hype that the news media wants to perpetuate.
When you click on the link, scroll down to the chart that says "Single Family Sales By Price." Look at the category that you are planning to purchase a home or sell your home. If you are a homebuyer and the green bar is longer than the blue bar for your category, you are in trouble. This means that the market for that segment is VERY hot and if you don't purchase soon, you may have to lower your standards for the type of home that you can afford or move to a less desirable city. If you are a homeseller and the blue bar is longer than the green bar for your category, you are in trouble. This means that the market segment is continuing to decline for your price range (better plan ahead and lower the price on your listing). If you haven't already noticed, foreclosures are the majority of the inventory in this market. Buyers- beware of buying foreclosures that have structural problems. These homes are not meant to be purchased by owner occupants, they are meant for contractors or investors. Sellers- beware of keeping your prices too high and negotiating yourself out of the market. The next time you'll experience prices like we saw in 2006 will probably be in 2012. If you can wait that long, then stay where you are. If you can't, MAKE your move right now before interest rates go up.
Paul Aragon is a top rated licensed realtor in the Northern Los Angeles County. He can be contacted at (818) 528-4410 and welcomes questions from all real estate owners, buyers, and investors. He can be reached at
Licensed broker & Luxury Estates Director servicing Los Angeles County. Specializing in the areas between Sherman Oaks, Calabasas, Chatsworth, Northridge, Granada Hills, Sylmar, and Santa Clarita.
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