Selling Your La Quinta California Home? Don’t Make These Mistakes!

Two of the most common mistakes I see La Quinta real estate sellers make when selecting a listing agent are choosing an agent solely based on: 1) Lowest Commission Rate; 2) Highest List Price for Your Home

Home sellers do this because they obviously want to pay the least amount of commission – and to get the highest possible price. But those two criteria have very little to do with hiring a competent agent and, in most cases, are totally irrelevant. Here’s the truth of the matter:

1) Regarding Lowest Commission Rate

Real estate agents are not equal; each is agent is unique. Keep in mind about 10% of the La Quinta agents do about 90% of the business. Each agent has their own marketing techniques and advertising budget. By choosing an agent with an aggressive marketing plan and a proven track record of actually executing the plan, you will gain greater exposure to the largest number of buyers. Reaching greater numbers of buyers will improve your chances of receiving an attractive offer.

Why would an agent willingly work for less than competitors? There’s always a reason why a real estate agent would discount a real estate fee. Sometimes it’s the only way the agent feels it’s possible to compete in a highly competitive business, because the agent can’t stand apart from the competition on service, knowledge or negotiation skills. If the sole benefit an agent brings to a table is a lower fee, ask yourself why. Is the agent desperate for business or unqualified? Do you want to work with a desperate agent? Sometimes La Quinta agents will negotiate a lower commission under special circumstances such as:

  • You’re buying a home and selling a home at the same time, giving both transactions to the same agent.
  • You’re willing to do most of the legwork, advertising, marketing, and pay for expenses related to the sale.
  • You promise to refer more business to the agent, which would result in multiple transactions.
  • You’re selling more than one home.
  • You don’t have enough equity in your home to pay a full commission.
  • The agent will lose the listing unless she matches a competitor’s fee.
  • The agent wants the signage (exposure to traffic) over charging a full commission.

2) Regarding Highest List Price

Agents can’t tell you how much your home will sell for. A listing agent can show you comparable sales, pending sales and active sales. But the home seller chooses the sales price and a buyer will tell you if the price is right.

To get the listing, some agents may “fudge” the truth about sales price. Since agents can’t guarantee your sales price, the listing agent who suggests the highest price may be “fudging” the truth. Ask the agent to show you the comparative market analysis (CMA) supporting their suggested listing price.

Look for a listing agent who gives you a price range – based on a current comparative market analysis. There is always a price range. It might be $25,000 apart on the low-end versus the high, or the spread might be greater depending on the overall price-point of the La Quinta home. Many factors determine the range,among which are location, market conditions, and improvements.

Pricing is an art. The most opportune time for an offer is within the first 30-45 days on market. If the home is priced right, you’ll get an offer. If it’s priced too high, you might not get any showings at all; buyers will shun your home and you’ll eventually end up reducing the price, leaving buyers wondering what’s wrong with your house.

If you are iinterviewing agents who offer similar services and can’t decide between them, ask to see a track record of their recent sales. Odds are the lowest-fee agent will show more price reductions and longer days on market. The difference between an agent who charges 5% and 6% is 1%. Ask yourself how
you come out ahead if your price ends up being reduced 2% because you chose a lower-fee agent who could not afford to actively market your home.

Tip: Hire an agent who lives in La Quinta and/or is familiar with La Quinta real estate – or better yet, actually lists and sells homes in La Quinta. Don’t hire an out-of-area agent who can’t adequately tackle the challenge without first-hand knowledge of the area.

About the Author
Brad Schmett is Broker Associate at Luxury Homes by Keller Williams in La Quinta, California. Brad is an expert, helping sellers best position their real estate for sale – and helping buyers to maximize their residential real estate investment. Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

Selling Your La Quinta California Home? Don’t Believe Pricing Myths…

Many La Quinta California home sellers struggle with establishing the sale price of their home. Selling a home can conjure up high emotions and cloud the objective thinking process of even the most astute business minds. I see it happen all of the time. It’s easy to set the price too high – and it’s easy to justify your price. The truth is however, there are some very negative side effects to overpricing your home.

Here’s my list of the top 5 “myths” home sellers believe when it comes to establishing the asking price for their home. Let’s take a look – and dispel each myth.

Myth 1 – Even If My Price Is A Little High, Buyer’s Will Still Offer & Negotiate A Fair Price.

First, if you’re priced too high you may have positioned yourself out of the consideration set of legitimate buyers who could actually afford to pay market value for your home. Secondly, when it comes to negotiating a “fair” sale price, the truth is, people in our culture don’t like negotiating. We do it in real estate because “that’s what’s done”, but for the most part we avoid it when we can. Many times, if a buyer sees that your house is overpriced, they’re likely to assume that you won’t come down to a fair level, and they’ll probably pass you by.

Myth 2 – Let’s Start A Little High, I Can Always Come Down In Price.

Price reductions can come with a negative side effect. Multiple price reductions are often an indication of motivation. Many sellers who need to sell their house quickly show this type of behavior, and many buyers see it as a good opportunity to get a deal. So, while you can reduce your asking price, doing multiple price reductions increases your chances of being viewed as motivated and desperate.

Myth 3 – If I Get A Buyer To Accept My Price, The Deal Is Done!

Many buyers will get a mortgage, and a bank will not lend on more than the house is worth. The bank will establish market value, and will only lend based on that. Pretend you sold your house for $550,000, when it’s really worth $500,000. The bank will lend based on $500,000, and will require that the buyer pays the extra amount in cash. More often than not, buyers can’t afford this and the deal will collapse. Even if they could afford it, they will ask themselves why they’re paying more for a house than it’s worth.

Myth 4 – There’s A Buyer Out There Who Will Pay My Price.

Yes, this may be true, but the odds are against it. The truth is, the majority of people aren’t going to take the biggest purchase in their life lightly. They will do thorough due diligence and will uncover all facts they need to know. Technology has made information abundant and easy to find. If they’re working with a real estate agent, which most buyers do, they’re almost guaranteed to know market value.

Myth 5 – I’ll Have The Same Level Of Interest When I Reduce My Price In A Month Or Two.

It’s a proven fact the first 30 days of the listing period will produce the highest level of interest and showing activity. After that, it’s old news. If your home is overpriced, you risk having them dismiss it and look for something else. It’s absolutely critical to capture interest as soon as the listing hits the market.

About the Author
Brad Schmett is Broker Associate at Luxury Homes by Keller Williams in La Quinta, California. Brad is an expert, helping sellers best position their real estate for sale – and helping buyers to maximize their residential real estate investment. Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

Short Sale Is Better In Long Run For La Quinta Real Estate Owners

Prior to 2007, you didn’t hear much at all about short sales, foreclosures, REOs and distressed properties when it came to La Quinta real estate. But since that time, these terms have become part of our local – and American lexicon.

Since 2007, many La Quinta real estate owners who found themselves upside down in their mortgage and could no longer make their payments chose the bank-approved short sale as a means to alleviate some of their financial burden. Although a short sale is something that no one wants to have to go through, it certainly is the lesser of two evils when compared to selling your La Quinta home as a foreclosure.

Contrary to popular belief, the effect of a short sale on the home owner’s credit score is virtually identical to that of a foreclosure – a dip of about 200 to 300 points. There is a notable difference, however. The owner who goes through a short sale may qualify to purchase a subsequent home in about 24 months whereas the wait for a foreclosure can be at least seven years before an individual’s credit rating begins to repair enough to purchase another home.

Throughout the greater Palm Springs, California area, distressed property sales have been the driving force within the real estate market for the past few years. In La Quinta California, due to the demographic make-up (more retirees and 2nd homes) of home owners, distressed property sales have been less severe than in other valley cities that have a higher percentage of family or working households.

Valley-wide, approximately 40% of sales being recorded through our local MLS, during calendar 2010, were either short sales or foreclosures.  In La Quinta, the statistic was more respectable with 36% of sales in 2010 being recorded as distressed sales. Mid-year 2011 statistics for La Quinta show steady improvement from calendar 2010 – and significant improvement from 2008 and 2009.  

About the Author
Brad Schmett is La Quinta’s Real Estate Market Specialist. Brad and his team provide sellers with information and resources that help them best position their real estate for sale and they work with buyers to maximize their residential real estate investment. Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

Internet Empowers La Quinta Real Estate Buyers & Sellers

The rampant surge of new internet-related technologies like social networks, blogs, virtual tours, YouTube and cutting-edge websites from large service providers as well as websites from individual real estate brokerages and agents, has given La Quinta real estate buyers and sellers more options to get information about the local housing market than ever before. In fact, the latest statistics indicate that over 90% of buyers and sellers alike will go to the internet for information before embarking on a real estate-related endeavor – whether it is for buying or selling La Quinta real estate.

In La Quinta and the greater Palm Springs California area, with so many of its seasonal visitors, potential buyers and non-resident property owners coming from all over the world, the opportunity to access information and view properties online from remote locations is invaluable. The truth is, the wealth of online information available and its ease of access has empowered the La Quinta real estate consumer more than ever before. Not many years ago, this information was owned and controlled by those within the real estate industry.

The continued growth and popularity of the internet has played a key role in the evolution of the local real estate market. Although the La Quinta real estate market is still somewhat seasonal, the availability and use of the internet has shifted the market toward more month-to-month consistency even during our summer months. We now have a legitimate 12 month real estate market, not just a 4-5 month market centered on our high season.

Now, La Quinta home buyers can now have new listings sent to them automatically, as soon as those properties hit the market. Buyers also have access virtual tours, slide shows, and videos to view homes before ever arriving here in the desert. When they do arrive, they can be much more efficient working with their real estate agent than ever before.

The same golden opportunity applies for La Quinta home sellers. With even a moderately technology savvy real estate agent sellers can showcase the best features of their homes with incredible photography and cutting-edge tools and reach a wider audience of potential buyers… from around the globe.

About the Author
Brad Schmett is La Quinta’s Real Estate Market Specialist. Brad and his team provide sellers with information and resources that help them best position their real estate for sale and they work with buyers to maximize their residential real estate investment. Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

Great Time To Buy A House In La Quinta!

The La Quinta real estate market is going through some challenging times but the time to buy may be right now. La Quinta real estate is a good investment, maybe not at present as a short-term flip, but as a mid to longer-term investment. Here’s why:

From 2002 to 2005, La Quinta real estate sales increased by double digits annually, as did appreciation. During the overheated market, there was too much flipping going on. Consumers were buying homes as short-term investments, so demand became far in excess of supply. As a consequence, developers ratcheted up the activity way beyond their normal levels to meet the insatiable demand. Here in La Quinta new and resale properties alike were bought and sold nearly everywhere you looked in order to meet an artificial demand. Lottery sales at new home developments were not uncommon.

Then, the market started to falter in 2006 and homes here in La Quinta weren’t selling like they were just a few months earlier. Shortly thereafter, financial markets began to tighten, the sub prime debacle occurred, ARM’s began resetting, the stock market tanked, the unemployment rate crept up, and the overall U.S. economy eventually went into a full blown recession. During this time, the property appreciation rate we thought would never end here in La Quinta – halted altogether. Supply began to far outpace demand and real estate values began to spiral downward. People who bought at the inflated values — and whose only purpose for buying was to sell at a higher price — were immediately underwater for thousands of dollars.

Here in La Quinta some values have been corrected in as much as 60 percent or more off of market boom highs with many areas in La Quinta having regressed back to early 2000s value levels.

The good news is – as a result of this wicked down-turn – now may be the best time in years to get back into the market and buy real estate here in La Quinta. Property values have stabilized for the most part and many experts feel that, although we may not be completely “out of the woods”, the worst is behind us and things will steadily begin to improve. Many current buyers that have recently jumped from the sidelines feel that even if we were to have another slight value correction, the regression back to early 2000s sale prices warrants getting back in – now.

For the prospective La Quinta Buyer looking to get back in the market – there are three major favorable elements in place – a nice supply of property inventory, attractive property values and historically low financing rates.

Now may be the best time – in a lifetime – to buy La Quinta real estate.

About the Author
Brad Schmett is La Quinta’s Real Estate Market Specialist. Brad and his team provide sellers with information and resources that help them best position their real estate for sale and they work with buyers to maximize their residential real estate investment. Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

The Psychology of Pricing Your La Quinta Home – To Sell!

So you’ve decided to put your La Quinta home on the market. You’re probably asking yourself how do I price it – so that more buyers see it – and notice it? Well, you can start by forgetting about what your neighbor’s house sold for last year and by putting any sentimental feelings aside. You (and your agent) also need to understand the real marketplace – and up-to-the-minute relevant market information.

So what’s next? Here’s the big decision: should you set the price high, expecting buyers will bargain you down eventually? Or should you start low to attract a lot of attention and get the inevitable discounting over with upfront?

You might be surprised how important this decision is.

Experts agree that starting high with the idea that you can always lower the price it later is a costly mistake. Pricing doesn’t just determine how much money you stand to make — it also dictates whether buyers even give your home a serious look. With so many competing properties for sale, in an extremely price-sensitive real estate market, your home has to stand out immediately as a good value or buyers will move on, unlikely to return.

You get one first shot at your home’s debut, and it’s easy to blow it.

New listings command attention. However, it’s critical that you maintain attention. To do this – your home must be “priced right” as perceived by potential buyers. Statistics indicate that the amount of traffic that a new listing gets in its first week can be as high as five to seven times what it gets in subsequent weeks. So, in other words, you lower the price later – but no one will notice. You will be broadcasting “priced reduced” to a much smaller audience of buyers and it will have the perception that your home is damaged goods.

About the Author
Brad Schmett is La Quinta’s Real Estate Market Specialist.  Brad and his team provide sellers with information and resources that help them best position their real estate for sale and they work with buyers to maximize their residential real estate investment.  Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

Selling Your La Quinta Home… How To Compete Against Foreclosures And Short Sales

Guess what? Your La Quinta home’s market value has direct correlation to distressed sale property prices if those short sales and foreclosures dominate your residential area.

If the home next door to you that recently sold was a short sale or bank-owned (REO) property, but all the other homes that sold in your neighborhood were not, you don’t have a problem. However, if most of the homes that have recently sold in your area were bank-owned homes and short sales, you may have a problem. That problem is – you must compete with foreclosures and short sale prices when selling your home.

Unfortunately, foreclosures and short sales are considered a part of the current real estate market – just as a “traditional” sale is. Prior to the real estate bubble of the mid-2000s, appraisers would often ignore any of the very few distressed sales when appraising a home. Now, with the local market being driven predominately by distressed property sales, appraisers pay close attention to the number of distressed sales that have closed and those presently for sale. So, what can a traditional seller with equity in their home do to compete?

Pricing A Home With Equity Against Foreclosures And Short Sales. Pricing a home has always been at best a mix of statistical data, common sense and emotions. It’s really a combination of wearing a seller’s hat and stepping into the buyer’s shoes. Keep in mind that it doesn’t matter much how much you think your home is worth if a buyer disagrees. Here are 3 questions you should answer:

  1. What would make a buyer purchase your home over a foreclosure or a short sale?
  2. Why would a buyer’s lender appraise your home for more than a foreclosure or short sale?
  3. How much more is your home worth than a distressed sale?

The real answers may surprise you. The truth is your home is not worth a whole lot more than a foreclosure, even if you put in upgrades, if all the recent sales are foreclosures and short sales. Appraisers don’t give a huge allowance for upgrades like they used to do.

In the current market climate, buyers demand value and a “good deal”. They might buy a home that needs paint and carpeting, for example, if adding the cost of new paint and carpeting still makes that bank-owned home’s price attractive. On the other hand, if your home, with equity, is in tip-top shape and priced within the range of distressed sales, a buyer is much more likely to choose your home.

Examine Foreclosed And Short Sale Comparable Sales. Look at every similar home that has sold in your area over the past three months to determine comparable sales. The list should contain homes in your development or within a 1/4 mile to a 1/2 mile and no further, unless there are only a handful of comps in your area.  

  1. Pay attention to neighborhood dividing lines and do not compare inventory from more or less desirable areas. Perceptions and desirability have value.
  2. Compare similar square footage, within 10% up or down from your property, if possible.
  3. Compare homes with similar ages, lot sizes and orientation, views, and home features. In La Quinta, for example, homes with a south-facing mountain view may command a higher value than those homes that don’t. Always compare apples to apples.

Interesting Local Statistics*. In the Coachella Valley during 2nd quarter 2010, the percentage of homes that sold due to foreclosure or short sale fell to 48%, down from 54% during 1st quarter 2010 and 60% for all of 2009.

In La Quinta, during 2nd quarter 2010, there were approximately 375 total sales with 150 of those sales being foreclosures and short sales. Only 40% versus the valley-wide average of 48%. *Source: Wheeler’s Market Watch

About the Author
Brad Schmett is La Quinta’s Real Estate Market Specialist.  Brad and his team provide sellers with information and resources that help them best position their real estate for sale and they work with buyers to maximize their residential real estate investment.  Brad can be reached at (760) 880-5845 or www.LaQuintaRealEstateInfo.com.

HOMES SALES FALL 5.1% IN JUNE

In the latest sign of renewed turbulence in the housing market, an industry group said Thursday (July 22) that sales of existing homes fell 5.1% in June 2010.

The National Association of Realtors (NAR) reported that existing home sales fell last month to a seasonally adjusted annual rate of 5.37 million units, down from 5.66 million in May. Sales year-over-year were up 9.8%.

June sales still reflect the impact of a popular $8,000 tax credit, which is due to expire on September 30, 2010 after Congress extended the June 30 closing deadline.

Meanwhile, the inventory of homes on the market rose 2.5% in June to 3.99 million units. At that level, it would take 8.9 months to sell all the existing homes on the market, compared with 8.3 months of inventory in May.

The national median existing-home price for all housing types was $183,700 in June, up 1% from a year ago, according to NAR.

The report comes after government data showed Tuesday (July 20) that new home sales fell to an 8 month low in June, while the number of building permits issued in the month rose.

About the Author
Brad Schmett is a licensed by the State of California as a real estate broker and is an active member of the California Desert Association of REALTORS®. Brad has been awarded nine (9) important nationally recognized and respected professional designations. He also holds Bachelor’s degrees in both marketing and business administration. Brad resides in La Quinta, CA.

HOME BUYER TAX CREDIT CLOSING EXTENSION PASSED AND SIGNED

Home buyers who qualified for the $8,000 Home Buyer’s Tax Credit who were unable to close on their home by June 30 have been given a reprieve. With President Obama’s signature last week buyers now have until September 30, 2010 to close on a home sale to be eligible for the credit.

To be eligible, buyers need a contract that was in place by April 30, 2010.

The National Association of REALTORS® has estimated that about 180,000 otherwise eligible buyers were likely to miss out on the credit if the original deadline of June 30, 2010 was upheld. It’s been difficult for some buyers to get their mortgages approved on time, as lenders work through a clogged pipeline of applications.

About the Author
Brad Schmett is a licensed by the State of California as a real estate broker and is an active member of the California Desert Association of REALTORS®. Brad has been awarded nine (9) important nationally recognized and respected professional designations. He also holds Bachelor’s degrees in both marketing and business administration. Brad resides in La Quinta, CA.

WHAT YOU NEED TO KNOW ABOUT OPEN HOUSES

In real estate, too much of a good thing can sometimes be a problem – especially when it comes to open houses. Too many showings could make it look like your home is hard to sell.

Online real estate listings, virtual tours, private showings – these are just a few changes in real estate that are making open houses more of an option than a requirement for selling a home. Believe it or not, generally less than 5 percent of homes sell from open houses.

This doesn’t mean you can’t use an open house to your advantage. It is a valuable opportunity to get feedback about how your house appears to buyers. It can also be a useful tool if you have a more unique home where pictures just won’t do it justice.

Just be careful about holding open houses too often. It can send a signal that your house is hard to sell.

Some sellers may be leery about letting total strangers wander freely around their house with access to personal belongings and information.

Others don’t want a lot of looky-loos wasting their time. Plus, open houses can pose security concerns for REALTORS® sitting alone in an empty house.

About the Author
Brad Schmett is a licensed by the State of California as a real estate broker and is an active member of the California Desert Association of REALTORS. Brad has been awarded nine (9) important nationally recognized and respected professional designations. He also holds Bachelor’s degrees in both marketing and business administration. Brad resides in La Quinta, CA.

Brad Schmett
Brad Schmett Real Estate Group
78065 Main Street, Suite 205
La Quinta CA 92253
760-880-5845 (Direct)
Brad@BradSchmett.com (E-Mail)
DRE License # 01310975

Disclaimer: Brad Schmett Real Estate Group is not affiliated with or endorsed by the residential communities presented in this website.
Information provided is deemed reliable but not guaranteed and should be independently verified.


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