OneTakeRealEstate: Verbal "Offers"

Perhaps the simple act of putting "offers" in quotes is indicative of my current position on this. The events that inspired this post:

-An agent called me yesterday on a recently listed (one week) property of mine, and asked me if my clients would take 15% off of the price.

-My response, in short:

--I don't make decisions for my clients; I provide them with great information and perspective.

--When written offers come, we have something tangible to discuss.

--Offers are about more than the purchase price (cash or financed? when is closing? other terms?)

--I can write an offer up in about 15 minutes, and have my clients sign it electronically in another 15. So I need to invest about 30 minutes, and my clients about 15 to put on offer on paper. That seems like a low barrier to entry for such a large purchase (any real estate purchase is a big one; this one in particular would be several hundreds of thousands of dollars).

--My seller put in writing (a listing contract which causes them to be represented in our MLS) that they would sell their home for X. The next move is for an interested buyer to also offer a number, in writing. If not X, then Y.

What to you think? When is a verbal offer the right way to go?

I recently engaged in verbal counter offering on behalf of four clients, living in four separate places, working together to sell a home for a family member. None of them were comfortable with electronic signatures (one doesn't use email) and one of the four was comfortable using a fax machine. And, the dialog had begun with offer and counter-offer, all in writing. We were in the inspection phase. So, the verbal felt OK.

Any thoughts?

Daily Activity + Laurelhurst Mid-Century with amazing living/master BR views

Here's a link to the home I'm in: http://www.matrix.nwmls.com/DE.asp?k=1550274XM0G6&p=DE-8489083-334

Interesting Mid-Century Opportunities in Magnolia

Two relatively similarly priced homes in Magnolia. One offers a large lot and a neighborhood of higher priced homes, the other offers great view of Downtown Seattle, Elliott Bay, and perhaps Mt. Rainer. I thought it was interesting to compare these two, but I was only able to secure permission to blog about one of them.

Monday Windermere Tour Results; Compared to previous Monday

Last week I had a property just north of Green Lake on Windermere tour. It was 3BR/2BA, listed at 750,000. 12 agents showed up. Today, I hosted a 3BR/1.5BA home just south of the lake and had eight people show up; three of then passers-by. What was the difference? Weather, I think (sunny last week and overcast this week). 

 

ThriveSeattle OneTakeRealEstate - Sunday Condo Open House; Newsprint brought people

The newspaper works to draw potential buyers to One Pacific Tower (2000 1st Ave). Not many come, but they are often well-qualified and serious.

Some poor word choice made me want to re-shoot this, but...more important was to keep the "one take" streak alive!

OneTakeRealEstate #5 - Today's Activity + "Timing the Bottom"

This week: Current Price Trends and "Timing the Bottom"
The following shows current (through June) price trends (average cost/square foot) in Metro Seattle.

Now, I definitely am not going to issue a blanket "buy now" opinion that purports to consider all elements of all buyers' personal equations. However, I did have the chance a few weeks ago to hear a financial advisor recount his attempts to serve his clients from 2008 through current times, and I found it thought-provoking:

-In early 2009, they were looking for the bottom; staying out of the markets.
-Two years on, it is easy to see that the Dow closed on March 2, 2009 at 6,626.94 and today closed at 10,817.65

-They are concerned now that they missed their opportunity.

When is/was the better time to buy? Things feel better now; more stable. But that stability certainly costs. And, what about life? We can't live in our stock portfolio or meet our neighbors there, so maybe there is more to the equation for owner occupants than dollars and cents. Something to think about...

ThriveSeattle's OneTakeRealEstate #4 - Windermere EVP Edward Krigsman re: PSBJ's Battle of the Brands

In today's edition, Edward shares his perspective on the Battle of the Brands competition in general and the strength of the Windermere brand specifically.

If you'd like to vote: http://www.bizjournals.com/seattle/feature/battle-of-the-brands-final-round.html

Video Blog #3 - How produce a great turn-out on Broker Tour day

Presentation+Pricing+Promotion (+weather!)

What Can Go Wrong With An Homeowners Association?:

Q: What Can Go Wrong With An Homeowners Association?:
A friend recently asked me this question. His question was about downtown Seattle condominiums, but as I considered my answer, I thought it important to point out to him that the answer applies to all properties governed by an HOA (sometimes single-family detached neighborhoods).

Also, I think it is important to note that the trouble normally isn’t with the association of people or with the all-volunteer boards who typically do thankless work on behalf of their neighbors. The challenges come from the physical structures they protect, from balancing homeowner rights/interests, and from financial troubles.

Physical structures: They are built by humans, so normally aren’t done 100% correctly. Envelope studies often highlight “construction defects.” When problems arise, the association has to determine what to do about fixing the problems. If the building is still under warranty and the developer agrees to fix the issues, no problem. If the building is not under warranty and/or the developer declines to remedy the issues, the HOA (or the HOA Board acting on behalf of the HOA) can elect to pursue legal remedy. During this time, it is more difficult for would-be sellers to sell.

Homeowner Rights: Rental restrictions are the hot topic here, and the rights of owners per the Declaration differ from building to building. Lender scrutiny and disinterest in buildings with “too many” renters is fairly consistent, so having a high percentage of renters can adversely affect the owner’s ability to sell. But, some owners want/need to move and are looking for alternatives to selling into a Buyer’s market (or simply can’t afford to sell into a buyer’s market) and wish to rent their home out in order to avoid defaulting on their loan (which would also negatively affect their neighbors). Again, a popular topic these days.

Financial Troubles: Financial troubles typically come in the form of capital expense for which there is no remedy to the developer. There is also financial pressure on associations in which homeowners have not been paying their monthly dues (which is common for owners who are also not paying their mortgages). If there is not, for any reason, enough money in reserves to handle the expense, an “assessment” can be levied on the homeowners to make up the balance.

“So, why not just buy a property not governed by an HOA?” he asked.
Good question. As an owner of both a house and a condo, I think I have a decent perspective on this. Fortunately and unfortunately, I call the all the shots (within the law) on the house I own. Remember that “all-volunteer board?” They sort through a lot issues for me at the condo. At the house? When my house needed a new roof, I had to pay for it (but not as much as my Dad’s friend Bill, who shot himself in the foot with the nail gun). I had more financial exposure and more rights/responsibility.

Magnolia - Briarcliff

I interviewed the listing agent for the Briarcliff development today. They currently have two homes built and a third almost completed. Their goal is for all 39 floor plans to be different. Interesting.

ThriveSeattle's first ever video-blog: Season1Show1

Congratulations to Trent and Michelle burns. Early feedback is unanimous: You did a great job on the remodel and should do this professionally. Are you sure you want to move?! (Video looks grainy here; let's see how it loads...)

This Week: “Nothing Sells in August!”

This is one of those often repeated bits of real estate “wisdom,” propagated by real estate professionals and hobbyists alike (maybe we just want to take the months off?). It is as easy to repeat as the “your first offer is your best offer” bit of counsel to sellers. But…is it true?

This is a graph showing For Sale/Sold/Pending (in escrow, but not yet sold) residential properties from Spring through Summer 2010, prices from $300,000 - $3,000,000.

We know that most properties take 4-6 weeks to close once under contract, so should look at August and September. We see that 889 properties went under contract in August, and 869 closed escrow (a large number of those had gone under contract previous to August, of course). In September, 792 properties closed escrow. There is a high likelihood that the majority of them went under contract in August.

I included April, May, June, and July so that would-be adherents to the “nothing sells in August” myth will have the data they need to argue that 869 and 792 are relatively “nothing.”

As an agent who has represented happy sellers and buyers in August, I respectfully disagree.

This Week: Economic Roller Coasters, Negotiations, and Learning Modalities

 How did you enjoy the ride this week? With the debt crisis “averted” things were looking up, right? The financial markets proved that it just isn’t that simple.

Opportunity though, often comes from uncertainty. Some say that the Chinese character for “crisis” is the same as that for “opportunity.” For those who feel that now is a good time to make moves in real estate (either putting pieces on the board, or taking them off), it is important to take great care.

In my negotiations this week, I was reminded of a couple things:
-Real estate agents would be wise to consider one of the principle precepts of medical ethics: “First, do no harm” or Primum non nocere in Latin. While it is tempting for our clients to make assumptions that put deals together, a large part of our role is to identify and advise them of risks.
-Often times there is another way. That is, we shouldn’t let convention get in the way. Another significant part of our jobs is to help a willing Buyer and a willing Seller find common ground even though the deal we end up with may not look like deals we’ve done in the past.

For a bit of fun that is also relevant to negotiating (in all aspects of our lives), remember that humans operate in three modalities and have a primary disposition to one of them:

Visual (pictures): 60% primary
Kinesthetic (feelings): 25% primary
Auditory (sounds): 15% primary

So, if we are interacting with people, and we don’t seem to be on the same page, we should ask ourselves: “Am I communicating in a way this person understands?” If we look closely, we can observe clues that will tell us how they operate. Contact me for more on this field if you like; it is fascinating.

Thank you for your valuable time. Thrive, Seattle!

ThriveSeattle Salutes Evan Fein

ThriveSeattle is just over 1 week late in congratulating member Evan Fein for his recognition last week by the Puget Sound Business Journal as one of its 2011 "40 Under 40" Honorees. He then went on to a strong finish in Seafair's Olympic Distance Triathlon, with his father and son also competing that day. Well done, Evan!