“Welcome Aboard. I’m Captain Mike. Both myself, and my co-pilot, Captain Hook, are first-time pilots. BUT, not to worry, we’ve read the books and passed our tests.”

Now that’s a flight I want to be on!

Would you trust your life to inexperienced pilots? Why would you entrust the sale of your most significant financial asset to someone who just read a book and passed a test?

I’ve noticed a scarcity of homes for sale by owners these days. In fact, I haven’t seen a FSBO sign in a yard for several months. I’m sure there are some out there.

At today’s local Realtors Marketing Association meeting in San Ramon, our usual market-in-a-minute update turned into market in 15 minutes or Market Update of 1000 Questions.

If you’re just arriving back on planet earth from the Mars expedition – the housing industry and the mortgage/lending industry are in total upheaval. Veteran Realtors and rookie real estate agents are all being challenged by the daily chaos to get deals closed.

I can’t imagine a home seller trying to go it alone in this market, unless they have a relative with cash that wants to buy.

If you’re thinking of going the “For Sale by Owner” route, you may want to pick up a copy of this book.

It covers the basics of what you need to do to sell your home with out an agent. Of course, the advice given is for a normal market and today’s market is anything but normal.

In fact, there has never been a real estate market like the current one.

This isn’t just a down market or an adjusting market. This is a never-been-seen before market that is being impacted by the consequences of banks and brokerage houses treating their customers like prey.

As the subprime meltdown has evolved into a total financial sector meltdown, home owners who need to sell are getting squeezed into financial jeopardy.

In this real estate market, the logical choice is to work with an experienced Realtor (or team of experienced agents).

For those wanting to go it alone, the book above is on the shelf right next to this one!

Current issues facing the real estate market:

• Increasing Foreclosures
• Liquidity Squeeze
• Tightened Lending Standards
• Rising Inventories
• Falling Prices
• Affordability
• Tightening Economy
• Consumer Psychology
• Fewer Available Sales
• Lower Sales Volume
• Less Available Income

What the Government Is Doing to Help the Housing Sector

• Mortgage Forgiveness Debt Relief Act
• FHA Secure
• Hope Now Alliance
• Interest Rate Cut
• Mortgage Reform and Anti-Predatory Lending
• Economic Stimulus Package
• GSE Reform – Increased Conforming Loan Limits
• FHA Modernization – Increased FHA Loan Limits

Methods Sellers Use to Sell Homes

For Sale by Owner – FSBO

• In 2007, the typical FSBO sold for $180,000, compared with $240,000 for an agent-assisted home sale
• In 2006, FSBOs sold for $187,200 and agent-assisted sellers sold for $247,000
• In 2007, 56% of FSBOs that sold didn’t list with an agent because they didn’t want to pay the commission.
• Up from 51% in 2006
• In 2007, 21% of FSBOs sold their house to a friend or relative
• Down from 22% in 2006
• In 2007, 11% of FSBOs were contacted directly by the buyer.
• Down from 12% in 2006

In 2007, the typical home listed sold within 8 weeks – up from 6 weeks in 2006 and 4 weeks in 2005

2007 Real Estate 2008

• Part 1
• Part 2
• Part 3
• Part 4
• Part 5
• Part 6

Click Here to Get In-Depth Local Real Estate Market Data - Updated Weekly

Greg Tracy has some good advice today over at BlueRoof for FSBO’s and agents.

Avoiding Potential Lawsuits When Selling Your Home – It’s short, sweet, to the point and worth the few minutes it will take you to read it.

I suspect that many homeowners give little thought to potential lawsuits that can arise with the sell of a home. Given the litgious nature of our society, it serves one well to educate themselves.

I keep seeing example after example in the MLS expired listings for San Ramon, Dublin and Pleasanton that are following the market down and the seller in this California market is losing big bucks that they did not have to.

The MLS history looks like this:

• Property listed at top dollar price
• 60 days later - price reduced to top dollar price for current market
• 45 – 60 days later – price reduced to top dollar price for current market

Are we beginning to see a pattern here?

If the price had been set somewhere between the 60-day & 100-day price, the escrow would be closed in eight out of ten cases and the owners would be on to the next phase of life with more money in their pocket than they are going to get now.

Instead, many sellers are going to do one of three things:

• Continue the pattern
• Pull the home from the market and wait for better times (6 months? 12 months?)
• Keep the price fixed at what they must get and play revolving Realtors

As professional Realtors, we do not serve the best interests of our clients if we do not understand our market, keep abreast of the trends, and have the hard talk with them when taking a listing in a transitional market moving down.

Setting the right price to move the property and maximize the return for the seller takes skill, experience and knowledge. Setting the price often involves overcoming the gap between the utility value of the house and the market value of the house. The utility value is the value placed by the owner that reflects their emotional investment in the property and how the property suits their needs.

Getting the price right is one of the biggest headaches and hassles for someone going the FSBO route – For Sale by Owner. Using Zillow, tax records and the prices of homes sold three months ago most often result in mis-pricing a property.

I feel sad for all of these sellers I see in San Ramon, Dublin & Pleasanton following the market down. They are losing so much money unnecessarily and I can only think that part of the problem is their agent lacks the experience needed to price it right or the backbone to have the needed reality check with the seller.

The market is not going to change dramatically in the near future unless it is forced dramatically downward by unforeseen events. It is transitioning to reflect a realistic and needed correction to the manic bid-up of two years ago.

Our advice to sellers – reality is always better than wishful thinking.

The Harper Team monitors over 50 Real Estate and News Feeds daily to bring you information pertinent to the San Ramon Valley & TriValley real estate market including the communities of Danville, San Ramon, Dublin and Pleasanton. We welcome suggestions.

Search our blog articles via the Tag Cloud - just click on a word that interests you.

San Ramon - Dublin - Pleasanton

For Sale by Owner Guidance 

Here is a great blog post for FSBO’s (For Sale by Owner) - 5 Things to Remember With A FSBO Online

The Harper Team has a special report to help anyone interested in going the FSBO route. People ask us why we would help FSBO's. Three big reasons:

• It helps keep the market healthy and a healthy real estate market benefits everyone.
• Sellers usually turn into buyers. It cost nothing for a buyer to use an agent.
• Goodwill is priceless and you never know how "what goes around will come around."

We have an incredible blend of talents, skills and experience that reinforce our optimism and confidence. We are in a people business first and property second.

The Harper Team monitors over 50 Real Estate and News Feeds daily to bring you information pertinent to the San Ramon Valley & TriValley real estate market including the communities of Danville, San Ramon, Dublin and Pleasanton. We welcome suggestions.

Search our blog articles via the Tag Cloud - just click on a word that interests you.