Let’s talk about… Protection

I’ve got my mind on my money and my money on my mind…

Protection is something that’s rarely discussed in our industry but it’s so important.  Many agents love to blog about the market, how many lovely homes they’ve sold, how to look past a dated kitchen or a lack of curb appeal.  Don’t get me wrong, I love all that fluffy stuff, too.  What’s not openly talked about is one of the key factors you should be hiring an agent for.  With the birth of the internet and sites like Redfin, Trulia, and Zillow, you as a buyer or seller have access to the listings and the ability to do market research yourself.  You can identify your perfect home on your own, so why even hire an agent?  You hire an agent because whether you realize it or not, this is going to be one of the biggest investments in your life and you want to make sure your hard earned money is protected.

You may also want to protect your heart.  Sound silly? Maybe it’s not.  You’ve walked into this home and you’re already picturing your son’s first steps in the living room, your daughter walking down that staircase in her prom dress, or late nights snuggled on the porch with a glass of wine.  This home is going to become an extended member of your family, you’re emotionally invested.  Then you’ve spent the time trying to decipher the reports which are written in another language (“serviceable” means what?)  and you’ve decided that you can live with or fix the flaws because every home has flaws but not every home has what makes this one feel right.  You’ve also sacrificed, choosing to forgo fancy meals or vacations to build up that down payment.  But now comes the stressful part.  Will the sellers like my offer?  Will they like me?  Did I choose the right amount to offer?  Should I have gone a thousand dollars higher?  What if the others offers are all cash?  What if the other buyers have more money in the bank?  What if we don’t get it?  Will I ever find another home I love this much?

Let’s face it, you sign on the dotted line and you’re all in.  It’s a legally binding document.

Now let’s take a step back… You just signed a legally binding document with someone licensed by the state to write legally binding documents.  In California, agents are the only other entity beyond lawyers who can write such binding contracts and your savings (and heart) are on the line.  Did your agent explain this contract to you?  Are you aware of all the terms you’ve just agreed to?

How did you choose your agent?  Was it because they were nice and made you feel comfortable?  Are they a family member who maybe took a few online classes and thought, “Hey, I can sell houses now?”  Or did you pick the professional who successfully does this for a living, who studies the market and the paperwork as though it were a craft that can be honed but due to consistent changes in the law can never be mastered?

A few days ago, we were invited to be part of a small, exclusive forum made up of the top agents from our brokerage to discuss the two contracts commonly used in our area.  We challenged each other and used our real world experiences to pick apart each contract to point out the positives and negatives of each one because neither one is perfect for all situations.  Most buyers have no idea that there are two standard contracts in our area and even worse, most agents are only comfortable working with one.  However, it’s important to know that each purchase contract protects the buyer and seller in different ways.  While the contracts can be modified a bit through the buyer’s choice of terms and terms can be negotiated later, the main fact is the contracts are very very different and the contract your agent chooses for your offer may be the difference between opening the door to negotiations and a hard no.  For example, one contract obligates the seller to make repairs while the other one doesn’t… which contract do you think the seller is more likely to accept if he/she’s got one of each sitting in front of him/her?

This all comes back to working with a real professional.  You can find the house but we are the ones who help you leap off that cliff and (hopefully) dive into homeownership.  The quality of the contract your agent writes, the importance of knowing which contract the seller or their agent would prefer, the knowledge base your agent brings to the table in knowing how to give the seller what they want while still protecting your rights as a buyer – these are all the factors that can stand between you and the realization of a dream.  Your agent can make or break it; they truly can be the difference between you writing an offer and buying a home.  As a seller, an agent who understands all the purchase contracts coming in will protect your rights, too.

(Sara’s Notes:  This advice may not apply to you as many states in the US require a lawyer to write up the contracts.  If you do live in a state where the contract is not written by the agent, I’d still advise you to pick an agent who fully understands the process and can ensure the entity writing the contract executes it with your terms and conditions in tact.  Contract writing is often the first step in the negotiation process so it is key to make sure that you have a strong negotiator with your best interests at heart.  Once it’s in writing, it’s very hard to redefine your needs.)

RE/MAX National Housing Report – July 2014

Curious how this recovery is effecting our country as a whole?  Overall Days on Market are down (excellent!), prices in metropolitan areas of the Mid-West are up, and an increase in inventory is having a positive impact on the nation’s real estate outlook.  Our market here in the SF Bay Area recovered faster than any other market and has settled into something that resembles a stable market (as depressing as that may seem to some who thought the Spring frenzy would last); now it’s the rest of the country’s turn to start seeing some positive numbers so those who wish to make a move can.

If you’re thinking about a change in the SF Bay Area, we’d love to help you!  If you are thinking about a change anywhere else in the world, don’t hesitate to contact us.  Through our vast network, we can help you find the right professional in your area to get you the best results!

REMAX_National_Housing_Report_July_2014

Are you thinking global?

If you’ve been thinking about selling your home, you may not have put a ton of thought into where your buyers are coming from. Or hopefully you have. Most sellers know they want to sell, hoping to get as much money as they can and move on with their lives and they trust their agent will expose them to the buyers. Or they blindly trust the internet will propagate their home’s listing to the sites the buyers are looking at. Every seller has one top priority whether they know it or not – to have their property exposed to the most qualified buyers. See that word I snuck in there? Qualified.  Sure the tire kickers will show up but you want solid offers.

A good listing agent knows where the qualified buyers are coming from and how they’re searching for their next purchase. If they’re looking locally, the listing agent will know the importance of being represented on a certain site, not just represented but they’ll make sure the listing is at the top because very few buyers will stick around to see what’s on page 5. In our area, the key is being on the front page of Realtor.com, Zillow, and Trulia (and yes, being a showcase listing is something we pay for out of our commission because we know how important it is to our clients, don’t assume every Realtor does this).

What if a large percentage of your buyers aren’t local? What if they’re looking at homes in your area from the comfort of their couch in China or Canada? They’re qualified, competitive, and making up a significant percentage of the buyers. Are they seeing your home?

We’ve heard sellers express that they don’t see the importance of working with a global agent, they don’t care if the company representing them has a global presence. I’m encouraging you to think globally because your buyers are.

RE/MAX has a presence in over 85 countries (I believe the total is 91 as I’m writing this) and is one of the most trusted real estate brands in the world. Our clients get the benefit of having their homes showcased on one of the most searched sites in the world for real estate and those buyers are put in touch with me directly because no one knows your home better than me, your listing agent. We have the benefit of having it all in one place so buyers in China can see my listing in Belmont and my Belmont retirees who dream of paradise can use the same site to look for homes in Playa Coco, Costa Rica.

Let’s look at the numbers from the National Association of Realtors (see slides below):

• 17% of the international buyers shopping for a home or investment in the US are shopping in California; second to Florida which has 23%
• Over 50% of the international buyers who bought a home in California last year were from Asia
• In the US, most of the International buyers made a majority of their purchases between May and August
• 39% of International buyers viewed the US as a desirable location
• 22% viewed US property ownership as a secure investment; this is even more important when considering the number of buyers in the Bay Area markets that didn’t see a huge price loss during the crash
• 31% not only said was a secure investment but a profitable one; we remain one of the very few markets that has not only recovered from the crash but a majority of our homes are worth well over their value at the height of 2008
• 42% of the International buyers searching for homes for sale on RE/MAX’s global site were looking in the US – far more than any other country in the world
• 4,542 is the number of unique page views global.remax.com saw in January 2014

And lastly…. 1

There is one office that has exclusive partnerships with remax.cn. We have a wonderful arrangement that allows us to showcase select listings on China’s national RE/MAX site giving our sellers exposure above and beyond the global site. Wouldn’t you like your home to have double the exposure to the fastest growing real estate buying sector in the world? The Hurun Global Rich List 2014 shows that China is home to 358 billionaires, second only to the US. Many studies have shown that no matter what your net worth, you want what most of us want – to have our hard earned money in a safe investment, to house our family in a safe neighborhood, good schools, steady employment, and a great location. All of which can be achieved by investing in the SF Bay Area.

Don’t take your chances and simply hope your home will be found by the right buyer. Make sure you list with the agents who will put your home in front of the best buyers to get you moving in the right direction.

We’re happy to help you with an evaluation, the advice is always free.  

Sara & Dave 650.200.7420