Could it be that every single home that had its price changed was overpriced? Transcript below was transcribed via an online system – FYI. Please listen to the Santa Clarita and Greater Los Angeles Areas real estate radio show for the better discussion.
New Speaker: 00:00 Good to everybody. Thanks for tuning in. Today is Monday, February 25th, 2019 you, yours truly Connor McCarver, longest running real estate podcast and radio show for Santa Clarita. Real Estate’s see me and Los Angeles. We’re headquartered here in Santa Clara Valley offices at two five one two nine the old road and that Santa Clarita California nine one three 81 in fact, if you’ve ever visited us in the past, we now move to two properties up. So we were at one building, two five 101 now we’re two five one two nine next to Caltrans lot. If you’re driving on the five freeway, north or south, you can peer over in a westerly direction as soon as you see in and out. If you’re coming from the south just before and you’re coming from the north just after, uh, two story, three story brick building, you’ll see it on the right, on the west side of the freeway, right next to the old road.
Speaker 1: 00:57 That’s our new headquarters. Two five one two nine sweet one one four. They’re very southern. Remax of Santa Clarita, remax gateway and remax of Valencia suites there as well. So very, very exciting stuff. We just move and I’m bringing this real estate radio show prior to me hitting the gym cause you know it’s what we all should be doing. So I’m making good on a promise to myself and hopefully I’ll be able to drag the kid back with me soon. That’s always fun. Anyway, let’s get into today’s real estate radio show, talking about real estate activity this past week and giving you an idea as to what’s going on now. We will talk price reductions today just because seems to be a bunch in comparison with the listings entering the market for sale. In addition, we haven’t seen that influx yet in real estate listings. Many more additions to the market.
Speaker 1: 01:54 We’ll start where we are still hovering as a real estate mark around 567 total real estate active listings on the market. These are houses, these are town homes. These are condominiums. These are acting through Valencia, so act in Oakwood, LC, castic and country Newhall. Saugus Stephen’s the Rancho Valencia. All through. If you look at Simi Valley, more park, same thing, ultra low inventory, San Fernando valley, Los Angeles, old tra, low inventory in those areas as well. Something to be aware of. What eventually will happen as buyers are hoping for and sellers aren’t. Sellers like that tight inventory because they really don’t have to do much to the residences. That’s Kinda your seller tip of the day. When you don’t have any competition, you’re house is going to sell without. You’re really making many changes to it because most buyers that are looking to buy the aren’t looking at yours as being in competition with another property.
Speaker 1: 02:59 If in fact of course you know there’s nothing else available around that is similar in nature. Let’s say people are looking at new houses. Well you know there’s, they are new so they’re going to build it for you. Whenever you get to that point, you want to see those STV new.com by the way, I CV new.com you can get there and of course the real estate radio show housing, radio.com lives there. You can go there. It will reroute you back to our main, so I just remember housing radio.com you’ll be able to see the data I’m looking at, so these listings hopefully will start coming out, giving buyers more to choose from, but that’s also a seller’s detriment too. As long as there’s a higher buyer drive then we have currently everybody is going to be happy and we will see how that plays out.
Speaker 1: 03:46 We don’t know where inventory is going to go in the future, but typically march is a big kickoff point. March through June, July. Big, big kickoff point from people that had been wanting to sell the real estate for the past few months, but one to wait until we got over the holidays and then now we’re in a new year, 2019 elections a couple of years away, so we’re kind of in the middle and everything seems to be pretty strong in the economy with of course the fluctuations in the stock market. That’s something to bring to your attention because I do have people making those comments that, oh my gosh, the stock markets in flux that can’t be good for real estate. Well, I would defend it by saying whenever the stock market gets kind of quirky, a lot of people go out there and they buy tangible assets. Gold, real gold, not paper, gold, real gold, silver, platinum and real estate.
Speaker 1: 04:45 They can hold on to it so you buy something, you rent it out, you hold onto the property, get some good tenants in there. Hopefully real estate continues to increase in value and it has been shown to do that historically. Then you use that piece of real estate to leverage others. 567 total units on the market for sale. Currently, I promised you that I’m going to talk about price reductions, but first let me give you a little bit of insight into searching and finding what’s going on with regard to real estate. If you email@example.com SCV, n e s t.com when you go there it says search the mls like a top realtor. All you have to do is punch in an address. If you see a listing online or you can punch in a city or a zip code or a school or a type of home and you will see all of those residences that are currently active on the market.
Speaker 1: 05:49 Also, very simply you’re able to see what’s sold in the past 90 days. If you want to see properties that are under contract, you’ll see those. If you want to see the properties that are having open houses scheduled and held, you’ll see those as well. A word about open houses and new housing. When you go in there, and this happens from time to time with our clients, they get talked to by the open house representative. Be Open House representative doesn’t literally twist their arm but it pushes them to put their name down. My name is Mary Smith, so they put Mary Smith down. Mary, what’s your email address so we can keep you updated with any awesome discounts and changes in the community while Mary says, well my emails firstname.lastname@example.org if you really are really mail address, I apologize. So email@example.com so then they’d put this together and whenever this person working with them three or four months for their agent, they don’t mention that they happen to go in there.
Speaker 1: 06:56 But finally they’ve exhausted all the first sale inventory. They’ve looked and looked and looked and then they say, you know what, we’re going to go back to the new housing and we’re going to go ahead and do the deal. So Connor, would you take us back there so you can represent us? And we’d be so happy. So Connor does Connor signs gets them to sign up, Connor’s there and present during contract signing and other things. And then Connor gets an email from party homes. In this particular case, this was the last one saying, well, three months ago, four months ago, your clients were in here without you, so you can’t represent them. There you go. So it happens. So whenever you go in, you giving up who you are affects you in that way. No further negotiation. I was able to get them every builder discount obtainable because I knew what they were offering.
Speaker 1: 07:51 So I was able to help with that. But you know, you, you find out about this stuff later, it happens. Price of doing business. I know they felt horrible. Uh, they gave us a great Yelp review because I’ve been working with them showing a lot of properties. We’ve been even had written offers together. But it happens. So when you go in, just be weary. So let’s get into those price changes. As I was talking about now, price changes don’t necessarily mean the market is collapsing on itself. Price changes indicate a lot of times that those properties are overpriced in the beginning. And the sellers are realizing that because I, he no offers, I either not getting the showings that they thought they would. Maybe they had a decrease in showings. Maybe there’s other competition on the market that is priced their real estate lower. Maybe they don’t need to make as much or maybe they’re more realistic.
Speaker 1: 08:45 So there are different reasons as to why people price their houses at certain points. A majority of it though, does rely back on what those present values are in the last 90 to 180 days. That’s how appraisers look at it. But you’ll be able to see all those price changes at Scv Nest. I’ve come, so that’s 68 so this could, these price changes could be up and could be down. But I will tell you there’s only a handful of increases and a lot of times that’s an error. So if the agent is pricing a property, for example, $550,000 and he has everything, put it in the system, ready to get this thing sent out to the world, when they get in there, sometimes they make a mistake. So maybe they hit the wrong button as far as in the price. So instead of five 50, they hit a zero and it’s 500.
Speaker 1: 09:47 Well, once they publish that listing, folks, there’s no way to take that back. It’s gone. So immediately they see their error and they go back and they change the price again. It’s gone. But when they changed the price, then there’s an increase. So a lot of people say, oh my gosh, why are they, why are they increasing the price? What’s up with that? Well, it could be a mistake. Very simply. A lot of the reductions are not though when you go the other way, a lot of reductions are mistakes, but it could happen. It just depends on buttons pushed and vetting, not done completely.
Speaker 2: 10:21 Okay?
Speaker 1: 10:22 So what I’ve seen in with that, and it happens from time to time, we did see that with these listings, like I said, a handful were increases. The rest were decreases in price. Uh, and the average is five to $10,000. Usually getting next to that next lower point. So something’s five 49, uh, in the half a million dollar price point. As you get less and less expensive, lower priced properties are gonna mandate, probably a less reduction in list price. However, half a million dollar properties, that average is five to $10,000. We see. So if you’re at five 49 now that new price would be five 39 and so on. Usually this is done within the 30 day range after a property, it’s been on the market 30 days. It does depend on seller drive and in addition, in this particular market, it’s not an indication by buyers that, oh my gosh, we’d better hurry or not an indication there’s something wrong with the property. They see these price changes happening. When you have 69 properties listed for sale is new listings in a week and you have 68 listings have their prices modified with a majority 60 plus being reductions.
Speaker 2: 11:42 Okay?
Speaker 1: 11:42 That’s the way the market is and these are reductions. As I stated earlier, these aren’t coming off of uh, properties where we’re having large price reductions are overpriced properties. At the particular point they were put on the market because right now we still have that high buyer drive, not as super is. It could be, and I think we’re going to see a super heightened buyer drive coming here march where we get the reduced days on market timeframes because right now we’re in the neighborhood of 40 to 65 days on market. I believe that’s going to shrink down into the 30 or less days on market timeframe. We also have the active under contract properties, so these are properties that are going into escrow at 49 new listings at 69 so we’re out running those particular listings on the market. So now we’re getting more inventory on, but it’s creeping up slowly.
Speaker 1: 12:36 Looking at closed listings, 51 closed this last week. That’s 51 properties having actually sold and closed escrow, eight properties expired, not selling under contractual timeframe, uh, contracts and real estate. Typically now we’re seeing three to six month contracts. It’s going to depend on the agents with those and what they’re able to get those sellers to agree with hold properties. 18 uh, that’s something that you might notice. You’re searching online and you’re tickled pink to be searching on STV nest.com my system just thought I’d throw that out. But anyway, you’re searching online and you see a listing pop on your radar gets sent to you, an email. When you go to click on the link to see it, it’s not there anymore. Should I go? What that, what happened? Where did it go? Well, could have been put on hold majority of the time it could have been sold and gone under contract, but you would still see that on my system at least.
Speaker 1: 13:32 But if it gets held and there’s a lot of reasons for it, maybe the seller got sick, maybe the agents using it to, uh, get interest. But again, they’re not supposed to, but usually it’s a seller issue. You know what? Um, I just got called by my aunt. She’s coming into town, she’s not feeling well. I’m going to have to take care of her for a few days, whatever it may be. So we need to put the property on hold. We can’t have any showings or be bothered during this time. That’s what the hold typically means. Back in the last foreclosure market hold was used a lot. If for the wrong reason because agents were getting so many offers, they had to stop that flow, that incoming offer all of them and say, you know what, we got 15 we’re going to deal with, we don’t need another 15 and that was the last cycle, but they used holding the wrong reason.
Speaker 1: 14:29 That’s why I hold now has different requirements to use and it has to be a seller issue and it could be challenged by an agent and a client if they had an attorney, potentially something to watch out for. I’ve caught him MCI ever. Thank you for listening today to today’s weekly real estate broadcast. How’s the radio.com I’m going to get in there and pump some iron today’s leg day, so that’ll be fun and I hope you’ve enjoyed today’s broadcast. Please. When you’re ready, I’m here as cvs.com Connor McCarver, cal DRM zero one two three eight four five seven remax gateway. Each office independently owned and operated. We are located at two five one two nine the old road, suite one, one for red brick building the four one corner if you’re tactically inclined, and that’s where I sit. So no blowfish on the window, please. We will talk to you soon. I’ve caught him archiver over and out.