Bidding Wars Home Sale Activity Picks Up

Ventura County Home Buyer Information Sales Market Heats Up

With East Ventura County housing inventory at it lowest levels in several years,  potential homebuyers are finding themselves in bidding wars once again. Investors flush with cash are ready to pounce on any good deal that comes along. This leaves many would be homebuyers standing on the sidelines. We continue to see sales where there are 5-10-15 offers that come in. Is this a sign of things to come ?  In my opinion there is just not enough supply to meet the demand. It’s not like there are armies of potential homebuyers, but there are more than enough people looking for homes that simply can’t find what they can afford to buy. When that hot deal comes along  it is snapped up, sometimes within hours.  But don’t be discouraged, all hope is not lost. There are plenty of deals still to be had potential buyers need to be prepared before they start home shopping.

HOME BUYERS BE PREPARED BEFORE YOU START HOME SHOPPING

Now more than ever potential homebuyers need to get their ducks in a row before they start home shopping. Here is a quick list of things you can do to get yourself ready to purchase a home. 

  • GET PRE APPROVED: There is a difference between being pre qualified and pre approved. With a pre qualification, a loan officer will review the the borrowers basic financial information and issue a recommendation based on this information. A pre approval goes one step further, the borrower will provide the loan officer all the necessary financial information and supporting documents and your file will be underwritten by the banks underwriter. This allows a buyer to act quickly and structure the purchase contract to be more attractive to the seller.
  • KNOW YOUR LOCAL MARKET- Take some time to do a little research about your local market. Local market dynamics will shift from city to city.
  • Know the features you want in a home. Do you want a large lot ? Is a one story home preferred over two ? What size bathrooms do you want.
  • Don’t underestimate the cost to fix up a home. Many buyers think they can do upgrades for cheap. You may be better off spending a little more money to get a home that needs minimal repairs. Email us for a free home remodel cost guide.
  • Employ a Knowledgeable Broker – Find a Real Estate Broker that knows the local market. If you really enjoy searching on your own great go ahead.  But hire a broker to help you negotiate the sale and paperwork. Real estate commissions are negotiable. Too many buyers make the mistake of negotiating directly with the listing agent. The listing agent works for the seller and has a duty to get the seller the best possible price. Contact us for help finding a home.

DOWNLOAD THE LATEST HOME SALE MARKET REPORTS

Home Owners Association Good or Bad ?

Whether or not you are a home buyer looking for a new home or a tenant looking to rent a property you should understand what exactly an HOA is and how it will affect your rights.  You should inspect the association documents carefully. Most Real Estate Brokers should be able to help you review the financials, by-laws, and restrictions that an HOA imposes on a property.

What is a Homeowners Association (HOA )?

In simple terms a HOA is a non-profit corporation comprised of all the property owners in a development(s). The owners typically higher a property management company to manage the association. The HOA elects a board of directors who works with the management company. The developer of the project typically creates the association documents, by-laws, and CC& R’s before the project is built and will manage and run the association until the development is a certain percent complete. The Board is the voice of the association and will work to follow the association governing documents. Often I hear people talk of the association in an adversarial way. Based on my experience, it seems a lot of property owners have an, us against them mentality. Where in reality all the homeowners are part of the association and can and should have a voice. In most cases people do not have the time to get involved they leave it up to the board to make all the decisions. Individuals on the board are elected volunteers and typically have other full time jobs. They will vote on key items and conduct the business of the HOA, typically acting on the advice of the management company. The key here is the management company. The board has a duty to its members to make the sure the management company is doing its job.  HOA’s govern various types of developments and are not limited to condo and townhome developments.

What Does The HOA Pay For?

Typically the association provides some insurance coverage, maintenance of a property’s exterior, green areas, pool and community areas and more. It really depends on the type of community and amenities. Single Family Home Associations (PUD’s) may not provide any exterior maintenance but only maintaining the community common areas. A common area is a space that is shared by all owners. Some associations are very complex and it is important for homebuyers to understand these complexities when purchasing a property in a development with an HOA. It is not something that should be ignored. How well an association is run can and will affect the value of the property.

Financial Componenet

HOA dues can be as high as $400 per month is some communities. If you are considering buying a property with an HOA consider this. With today’s interest rates around 4% for 30 year fixed rate loan it costs about $477 per month for every $100,000 you borrow. If your HOA dues are $350 per month you could spend $70,0000 more to  purchase a property without an HOA.  This means the property in the community with an HOA needs to be priced about $50,000 lower than a property without an HOA assuming the HOA is paying for the Hazard Insurance on the property.  

Home Prices Are They Finally Affordable?

Our Bi-Annual report on the sale of single family homes and how this correlates to the rental market is coming out in July. This detailed 6 page report is every investors dream. There is no other firm in Ventura County publishing and tracking this data for you. In anticipation of the report we are releasing a small section for preview today. We selected a sample of single family homes and attached units  in Ventura and West LA County. We selected homes that sold in the range of $200,000-$600,000 with at least 900 sqft from Jan 1, 2010 thru June 15th 2010.  We wanted to compare what the sales numbers looked liked, what are avg prices and what is the avg. sqft. 

Based on our findings the median price was $362,000 the avg price was $373,593, based on a sample of 1918 properties.  3 bedroom properties were the most popular with over 900 sales and an average price of $378,000. Broken down even more the avg price per square foot was $240.00 with an average size of 1617 square feet.
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