6 Ways to Stress Free Showings

If you’re selling your home with us, we’ve probably asked you to be as accommodating for showings as possible, and for good reason.  Accommodating for showings lets potential buyers know your motivated and serious, and gives a glimpse into what the escrow process might be like with you as a seller.  It’s a first impression in many ways—of you as a seller, and of your home.

We know how tough frequent showings can be, especially when you’re trying to live your life!  We’re sharing a few of the tips we often share with our clients to help them live as normally (and sanely) as possible.

  1. Make yourself a pre-showing checklist.  It’s easy to forget things when you’re in a rush.  A checklist can help ensure that your home is putting it’s best foot forward for potential buyers.

Some items to include:

Make the beds

Puts dishes away or in the dishwasher

Clear countertops

Bathroom sink and mirrors wiped clean and toilet seats down

Toys put in baskets and bins

Messes from pets cleaned and deodorized

Entry clear of shoes and backpacks

Lights on and window shades open

Take out the trash

2. Show some self love.  Think of this selling period as your opportunity to have your home as you’ve always wanted.  Show yourself some love with fresh flowers, a bowl of fruit or that “fancy” soap.  They make your home look extra lovely for potential buyers, but you’ll enjoy the daily benefits after the showing is over.  GT Tip: If you’re working on a tighter budget, use succulents and bowls of fruit that don’t require much maintenance and refreshing.

3. Get non-transparent bins and baskets (with lids!) In a pinch, these can serve as a catch-all of items without making the house look cluttered.  Laundry baskets with lids and non-transparent containers will make it look like you’re as organized as your Pinterest makes you out to be.

4. Make your bed as soon as you wake up.  This simple task can make you feel accomplished, set the tone for the day, and make that last-second showing a total breeze.  If you have kids, make their beds too or get them in the habit of doing so.

5. Keep a spare rack of fresh towels on hand.  It seems fussy, but having nicely folded white towels can make a bathroom feel cleaner and more spa-like.  Keep clean towels that you’ve already folded in the cupboard, or somewhere you can easily pull them out.  This will help eliminate the stress of worrying about whether the towels are clean all the time.

6. Know this—it only takes 30 days to make a habit.  If you can get through the first month, then going through that pre-show checklist will be a breeze, and the stress of last minute accommodations will have dwindled.

You Might Want to Consider a Solar Panel System

Solar panels are becoming increasingly beneficial with the rising costs of electricity.  You’re probably feeling that high cost over these summer months when the air conditioning is running high and the kids are home from school using more electricity than normal.  With rising utility costs, there are more government and economic incentives to reduce your carbon footprint and lower your monthly bill, not to mention the increased value added to your home.

Depending on your method of purchase for the equipment, solar can be a long term investment with a sizable return.  Many people lease their energy system from a third party developer, at no upfront deposit or downpayment, and pay the electricity produced by that solar system, at a lower cost than the current rate.

When you invest in your own energy system through a cash deal, you gain complete ownership of your system and electricity produced from day 1.  Cash deals have government tax credits, up to 30% of the cost of your energy system.  While the upfront costs are high, the long term return is even higher.  For example, a $30,000 investment would cost you $21,000 after a 30% tax credit.  Taking into account a $3,600 savings (based on an average $300 utility bill), the system is paid off in 5.8 years, and you save $90,000 after year 25.

Even if you don’t plan on staying in your home for 20 years, a solar energy system adds incredible resale value.  In the same way that swimming pools typically garner larger sales prices, so too, does an energy system.  Best case scenario, your system cost $30,000 to install (before government tax credits), and sells for $30,00 higher.  All the while, you still enjoyed the benefits from eliminating your electricity bill.

The maintenance? Solar panels don’t have moving parts, so much maintenance isn’t required.   You’ll want to occasionally rinse the panels with soft water to eliminate any bird droppings, dust or leaves.  In most areas, a little rain does this nicely.

We’ve had an amazing experience ourselves with solar energy.  Tell us how you feel about solar, if you’ve thought about it, or some of the experiences you’ve had!

Source: Barnes Solar Engineering & Installation CSLB #943909

What's Happening With the Housing Supply?

If you’re currently working with us, you may have heard us talk about the short housing supply in recent months; the home buying demand continues to outweigh the number of homes for sale.

Nationally, the inventory of homes for sale in May is 3.8 percent lower than this time last year, according to data from the National Association of Realtors.  Redfin, the leading site for home buyers, has also reported a drop in new listings.

Simple economics teaches us that when supply is low and demand is high, price goes up.  Home values across the country were expected to rise by a mere 2 percent growth from this time last year, but Zillow’s latest data shows values soaring more than 4.9 percent increase in value.

But why?  Why is the inventory so low? Economics, demographics, tax policy, are all playing a role.  Current homeowners are simply staying put longer.  Here in California, only 4.8 percent of of single-family homes turnover, as opposed to the 9 percent back in the late 70s.  Most homeowners stay in their homes 5-7 years, but now we’re seeing homeowners staying put for an average of 10 years or more.  Low rates on current mortgages, low property taxes, and capital gains hits are just a few reasons long-time homeowners are staying put.  When they do the calculations and look at what they would be giving up compared to what they would be getting, many decide to stay.

So if the turnover rate is low, and demand is high, what can we expect from new construction? New homes add to the housing stock and provide much needed housing for the many regions that are undersupplied.  Many areas in California are struggling to keep pace with local growth — job growth and household growth.  California is amongst the most underbuilt areas in the country, with only one permitted new unit of housing for every 1.6 jobs, compared to the U.S. average of almost two permits for every job created.

It's More Common Than Ever: Kitchens and Baths

It’s so often that we as buyer’s agents hear our clients say, “But we’ll have to redo the kitchen and update the bathrooms…”  Sellers know this and we know that what typically sells a home is the condition of the kitchens, and the condition of the bathrooms.

It’s no surprise that the most common remodeling jobs performed in 2015 were bathrooms (leading with 81 percent) and kitchens (79 percent).  As selling agents, we often hear our clients worries with remodels, the extent of remodeling and the costs.  Remodeling your home for sale, and remodeling your home for your own personal use, are very different, so we’re giving a few of our tips below:

  1. Decide what your goal is.  If your goal for remodeling is to earn top dollar for your home when you go to sell, then updating the kitchen and bathrooms is going to help you achieve that. The less a buyer has to do, update or fix once they move in, the more selling power you’ll have as the homeowner when it comes to the negotiations.
  2. Myth: you need to spend a fortune.  You’ll want to set a budget and pick the best returns on your money — i.e. functional, practical and appealing items in the kitchen and bathrooms that help bring the home up-to-date.  Think quartz, granite, butcher block and subway tile as opposed to marble, rare wood species and custom tile (though those do tend to add value).  Don’t go wild with colors, stick to neutrals, whites, grey and black.  Yes, we said black.  Black is very in right now.
  3. Tip: get three quotes from each vendor and pick the middle man.  The middle man will typically do as good of a job as the highest bid, but at the more fair price.
  4. Stage it.  If you’ve gone through all the work to bring the home up to date and appeal to current home buyers, you’re old and out-dated furniture may bring the value back down.  A home stager can help highlight the new upgrades and create a beautiful scheme that helps sell your home faster.

Beat Out the Competition With A Winning Offer

You’re ready to buy a home.  You even find one that you love 2 weeks into your search and even offer 5 percent over the listing price, just to make sure it’s yours and no one else’s.  Then your real estate agent calls: 12 other offers had been made, and yours isn’t even in the top three.

When inventory is low, competition is stiff.  A seller’s asking price becomes just that: an asking price.  A seller may choose to price their home well below what the market will bear, with hopes of attracting multiple offers.  As a potential buyer, you may be forced to compete with other buyers in a  bidding war.  Here are a few tips to beat the competition.

Make sure you’re working with a good agent that “gets it”.  A seller is looking for a sure thing and a smooth, clean escrow.  Experienced agents have relationships with inspectors, contractors, mortgage brokers and appraisers to help facilitate this process, not to mention good standing relationships with other agents.  When faced with multiple offers, a seller, guided by their agent, may choose to work with a lower priced offer because that buyer has a good agent.

Get your financing in order before making an offer.  This means being pre-approved for a loan and staying in regular contact with your lender during your search.  You’ll need to be ready to move as soon as homes hit the market, having a pre-approval letter and financing in order will help you present yourself as a strong, motivated buyer.

When the opportunity comes, don’t wait.   We hear this all this the time, “I wish I hadn’t waited on ‘Bleaker St’.  Now it’s gone.”  The buyers who don’t rest on their laurels get the home.  If you’re serious about buying and have your financial ducks in a row, don’t wait for the open house, don’t wait for your husband’s mother to fly in from Utah to see it.  Knowing what you need, and knowing what you want are two different sets of lists.  If you see a home that meets your criteria, it’s likely that it won’t be there in two weeks, so be prepared to act fast.

How to Make Multigenerational Housing Work

We, as human beings by nature, have always been dependent on extended family–a notion we’re beginning to move back to.  A growing share of American households have three of more generations of the same family living under the same roof.  Typical situations include grandparents who need extra help, young adults moving home after college and of course, mortgage paying parents. Extended families are increasingly motivated to live together are a way to deal with housing affordability (or lack of).  Combine that with cultural and social forces and you get a whole new set of criteria and needs for buying a new home.

Ask yourself if this situation is long-term or short term.  If your debt-saddled millennial is moving back in because they can’t afford a home of their own just yet, the situation is likely to be short term.  When adult parents move in with their children–for health reasons, say–the situation is likely to be without an end date.  Then it may be worth moving into a more suitable home or making the renovations to your existing home to make it more comfortable for everyone living there.

The key to making all adults in a home feel comfortable is to insure that everyone has a place to retreat to that’s all their own.  There’s a lot of Home TV about knocking down walls and making open concept living spaces, but that may not make sense for multi-generational homes.  Many new home builders have optional bedroom quarters downstairs, even casitas, which make for great in-law suites with ensuite baths.  For long-term situations, consider flexible spaces.  An upstairs loft can be a play room for toddlers now, and an additional bedroom conversion for a grandparent 10 years from now.

In Review: The Outlets at San Clemente

There was a lot of buzz surrounding the outlets here in San Clemente, and in the months since their opening, the buzz hasn’t really died down.  Personally, we’ve been a few times, and were happy with the experience.

The outlets on their own are beautiful, they’re set near the shores of San Clemente and are true to the local architecture that San Clemente is famous for.  The spaces are wide, the parking is vast, and it’s a pretty easy in and a pretty easy out, not to mention the ocean views.

Those of us living in town often would have to travel a bit of ways to do any shopping at major retail stores, but the added convenience of having those retail stores is as much a benefit as it is impact.  Opponents of the malls recall San Clemente’s origins, as a quaint beach town set at the southern most part of Orange County.

When we look at the economics of the malls, there is no denying the potential for revenue in San Clemente from sales tax.  The city has cited projects that would be funded by the tax revenue, including upkeep of Vista Hermosa Sports Park.

The outlets have more than 70 retail locations throughout phase one sitting on 52 acres.  We went to three, and made purchases at all three we visited.  Every shop we visited had no lines, no crowds and was hosting some type of sale.  We went on a Tuesday.

While the argument could be made that the shops are gaining momentum, and once the restaurants open, we’ll see more traffic being pulled from Dana Point and San Juan Capistrano, but we can’t help wondering how much steady tax revenue could the shops actually generate, even if everyone in San Clemente made a purchase once a day.  Just a few days ago, the San Clemente City Managers office released the expected sales tax revenue to be about $300,000, down from the projected $835,000.  Don’t be alarmed, the forecast was based on the outlets opening in June, and didn’t officially open until November.

When Ruby’s opens, we’ll be some of the first to take the family down for some burgers and a walk around.  Until then, we’re curious how things will shape up, and what others are saying about the outlets in our prized town of San Clemente.

Have some opinions about the Outlet at San Clemente? We’d love to hear them!

Take On A Simple Mindset in 2016

Many of us dream of the perfect home, clutter free and serene, with no fingerprints on the fridge, no dust on the shelves and no GI Joes hidden between the couch cushions.  We dream of waking up to fresh sunshine, sipping coffee in our pristine kitchens and casually getting ready for work in our color organized closets.  The reality is that’s just not reality.  We have lives, we live in our homes day-in and day-out, we have busy days and slow days.  This image of perfection is one sold to us in magazines, commercials and movies and here is the first step to tackling your clutter in 2016 and getting your home organized: depart with that image of perfection, and instead, take on the mentality of simple living.  Ask yourself, “What do I need?” Everyone will have a different response to their needs based on their lifestyle, but that’s the beauty of it.

Once you commit to taking on a simple living mindset, start by tackling one room at a time.

1. Your Bedroom Closet. Most of the items you take out of your closet will probably be spewed out into the bedroom.  Starting here will give you a clean canvas to work with when it comes time to working on the bedroom.  When it comes to clothes, aside from seasonal items, if you haven’t work it in 6 months, you probably aren’t going to start now. Most of us have attachments to clothes and other personal items in our closets, but asking yourself what you really need will help narrow it down.

2. The Bedroom.  The bedroom is your sacred place to retreat to at the end of the day.  It’s the room you’ll have your last thoughts before going to sleep, and first thoughts when waking up.  Decluttering your bedroom will not only make it easier to manage the other rooms of your home, but set the tone for doing so.

3. The Garage.  When you start moving to other areas of the house, you’re going to need space in the garage for the items you’ll be storing.  Decluttering isn’t moving your stuff from one room in the house to another, it’s an actual sweep of things you don’t need and are bogging you down.

4. The Kitchen.  (You’ll be tempted to start here, with the reasoning that it’s the most used room in the house.) Break the kitchen up into zones: beverage zone, cooking zone, washing zone, serving zone, etc.  Having the items associated with these zones will make it easier to decide where things go and keep you from running all over the kitchen to get items you need.  Clear out the pantry of anything expired and wipe down the shelves in the fridge for a dose of freshness.

5. The Backyard/Patio.  There’s a reason people love ocean and mountain views.  These views are uncluttered and bring a sense of calm to the inside of the house.  You won’t be able to settle down if the view from your windows puts that “Oh, I have to do that” in your mind.

6. The Family Room.  If you are always looking for the remote, it’s because the remote doesn’t have a place it belongs to.  If there are always toys in the room, it’s because the toys don’t have a place they belong to.  Family rooms often function as a plethora of spaces, and rightfully so, but this makes it hard to ask yourself what you need for this room.  Be honest about how you and your family actually use the room.  If most weekends you find yourselves eating in front of the TV, embrace it with some floor cushions around the coffee table.

Once you’ve tackled these rooms in this order, you’ll feel empowered and free to move to other areas of the house.    Most of us tend to think “I’ll do it later,” but procrastination comes at a cost.  Try thinking of every thing you own in terms of time.  The more stuff you have, the more time it will take you to clean it, store it, maintain it, etc.  In the process, don’t loose sight of the goal: to be settled in your home.  Happiness is not dependent on order, but with order comes a sense of calm, control, and gives you more time to do the things you want to do.

How Much Do I Need to Put Down?

If you’re like us, you have a list of resolutions this year.  A lot of people we’ve spoken with lately tell us that buying a home in 2016 isn’t necessarily their New Year’s resolution, but planning to buy a home is–with one thing in their way: the down payment.

Most of us often feel anxious and overwhelmed at the idea of saving for a down payment.  The good news is that first-time home buyers can purchase a home with as little as 3 percent down in some programs.  There are a few stipulations to this, but we’re giving you the lowdown below.

The less you put down, the higher the mortgage balance, and the more you’re going to pay.  Typically, homebuyers who don’t make a minimum down payment of 20 percent will be required to pay private mortgage insurance (PMI).

What is PMI and how much does it cost?

PMI protects the lender in the event you default on your loan.  The cost is most often added to your monthly payment if you’re taking a conventional loan, while loans offered through the Department of Veterans Affairs, the U.S. Department of Agriculture and the Federal Housing Administration handle PMI differently.

The less you put down, the higher the mortgage insurance is.  With say, 5 percent down, your PMI is quite high.  The total cost of PMI depends on your credit score, and is calculated in terms of risk in tandem with the size of your down payment.  For each $100,000 borrowed, PMI typically runs between $30 and $70 per month.  If you’re buying a home worth $500,000, with say, 10 percent down, with a 30-year-fixed rate at 4.25 percent, you could expect to pay up to $200 per month in private mortgage insurance.

You have options.  If you need to pay PMI, the size loan you can get will be slightly smaller, to allow for the bigger payment.  If you get a conventional mortgage, you can get an appraisal and write to your lender and ask to have the PMI removed once you have more than 20 percent equity in the house.  FHA loans, on the other hand, have PMI attached for the life of the loan.

So how much should you put down? 

Depends on your personal circumstance.  You’ll want to make sure you have enough on hand for closing and upfront costs, such as a years worth of taxes and insurance.  We suggest speaking with a mortgage broker who can examine your current situation and make a plan that’s in line with your goals.  A good mortgage broker can help you weigh your options and help you decide how large of a down payment you’ll need.

There are a few popular programs you can get with a low down payment, which may be particularly appealing to first-time home buyers.

Conventional mortgage: Fannie Mae and Freddie Mac can back loans with as little as 3 percent down.   To qualify for this type of loan, you’ll need good credit.  If your credit isn’t in good shape right now, talk with a broker than can put you on a good trajectory to start the repair process.

Federal Housing Administration loan: This can be more expensive than a conventional loan, but the FHA has backed loans with as little down as 3.5 percent.  They’re also more willing to back loans with buyers who have lower credit scores and thinner credit records.  PMI will certainly be factored into this, making the size of the loan you’ll be able to afford a bit smaller due to the monthly payment.

U.S. Department of Veteran Affairs: If you served in the military, you can get a loan backed by the VA with no down payment at all.  You’ll have loan origination or funding fees but those can be financed in.  This is a really good program, though you’ll still need to qualify based on credit and income.  The interest rate is low, there’s no PMI and you may find some extra perks along the way.

Our 2016 Predictions

There’s been a lot of buzz surrounding the rise, if any, to interest rates and a pending slowdown in the real estate market.  When we think about this in the historical perspective, we’ve had about 15 years of abnormal trends.  A slowdown isn’t necessarily an indication of a problem but rather a return to normalcy.

The real estate market is largely reactionary, and 2016 is bound to give us a lot of reactions.  We may react to higher interest rates with easier lending practices, or to higher rental rates with home purchases, or even affordability of new construction given last years poor performance of high-priced new homes.

Alternative Ways to Determine Credit Worthiness 

The new Credit Score Competition Act of 2015 introduced Thursday to the House of Representatives would would let Fannie Mae and Freddie consider other credit-scoring models other than the FICO credit score currently used when determining what loans to purchase.  For borrowers who lack traditional forms of credit, this could level the playing field and make it easier for them to buy a home.  Potential homebuyers without a FICO score or with a FICO score below 620 are deemed ineligible for a mortgage that can be backed by Fannie or Freddie.  This new bill could lend alternatives to FICO score, that would take into account something as simple as whether borrowers paid their rent on time, or paid their utility bills on time.  Alternative factors to establish credit worthiness in 2016 could broaden the market to include a new demographic that was once frozen out of it.

More First-Time Buyers

We’re predicting first-time buyers to make up a bigger share of the market than they did this year.  Slowing price growth and easier access to loans could welcome potential buyers, buyers that have been holding off on taking the plunge over the last few years for various reasons. Rental rates are skyrocketing, and the cost of renting is only slated to rise.  Many have rents that exceed 30 percent of the income of renting households, making a home purchase as the more affordable option.  More first-time home buyers include young adults between 25 and 34, who made up 2 billion sales in 2015 and are expected to be a major buying pool in 2016.

More Affordable New Construction 

 New home construction was one of the hardest hit sectors after the fall of the housing market.  Faced with higher land costs, limited labor, and concerns about demand, developers scaled back nearly 80 percent of their product.  As such, builders shifted to constructing more higher-priced homes.  In 2016, we’re likely to see a shift to more affordable product, catering to entry-level buyers, and we’re already seeing a decline in new-home prices.  We’re also likely to see a larger inventory of new-homes, which are expected to rise by 23 percent.  This broader scope of inventory could coincide with healthy sales of new-homes.

 The one constant that will remain in the new year is our commitment to quality care and expert service.  Contact one of our agents to find out what GreenTree Properties can do for you in 2016.