Winning in a Multiple Offer Situation
The Torrey Team has been very successful over the years in winning multiple offers for our buyers. Not long ago we had a streak of winning ten in a row. Multiple offers are the norm rather than the exception in today's world. We are hearing stories about buyers who have lost out on 15 straight homes that they have bid on! I think it is time to review once again what we have learned in our many years of negotiating multiple offers for our buyers.
Obviously, we think it is important for a buyer to make a strong offer and be pre-approved in writing by a respected and visible lender. The pre-approval process should occur before the offer is written. When we sort through comparable sales data with our clients we explain that it is all "old news". That is to say that the meeting of the minds between seller and buyer usually occurred at least 30 days ago, and very often 3 months ago-"all ancient history." When we have a strong seller's market like this one we need to factor in a 10-15% annual appreciation rate. Clearly, lack of inventory is driving the market now and will be for the foreseeable future.
Offer guidance can also be achieved by interacting with the listing agent. How many offers are in hand and how many do you expect? Past relationships with other agents is also a huge factor. If the listing agent trusts you because he or she has had a positive experience with you he or she may reach out to you with much more information than is imparted to the competition. With over 1100 career transactions the Torrey Team has a lot of positive relationships with other realtors.
Conveying buyer passion with a well prepared introduction letter to the seller is also very important. This used to be in person and still is in isolated cases. The seller wants to know if the buyer will appreciate his home as much as he does. If the seller feels that connection he may accept an offer that may not financially the strongest. This letter should aim for the heart because most homeowers have an emotional connection to where they live.
The most important factor is trust between agent and buyer when combined with communication. When we are in action negotiating for you we will keep you posted every inch of the way-so you will know "when and how to pull the trigger" on short notice for a purchase. Windows of opportunity open and close very quickly, and the Torrey Team will be there to help you make the right decision! Think positive! We are!
What a Year!
This year has been The Torrey Team’s best in terms of real estate production, but that is not what we will remember most. What was most memorable about 2012 for us was the great friends and clients with whom we worked. You folks made our phenomenal year possible! Thank you for your faith and trust!
We had great success with our 22 sellers this year, selling most of our listings over asking price. Some of our clients were moving out of the area, some were short sale sellers, some liquidating assets, some flippers, and so on. Not to take away from our sellers, but this year was more about the challenges our buyers faced. For the first time since the early 1980s we worked with more buyers than sellers.
The 2012 market featured the least amount of inventory Pete has seen in his 35 year career. This combined with historically low interest rates, and significant consumer confidence, created a feeding frenzy that was incredible. In this highly competitive and super stressful environment, we managed to get 30 buyers into their new homes this year!! Most of these clients, whether they were family, friends or referrals, won out on multiple offer situations at an amazing rate. The process was time intensive, time sensitive, and always complicated, especially when you combine negotiations, inspection results, and loan processing simultaneously. All the while our buyers hung in there, fighting with us and not against us. They made decisions based upon the trust they had for us, and we cannot overstate how much we are appreciative of that trust.
We all agreed that this year, and the accomplishments touched on above, is about as gratifying a year as we can ever remember. Sure, Zack may have had his foul language reach an all time high, Pete got even more philosophical about the real estate business, and Andrea managed to do more business in Lululemon than the actual owner of the company! If we didn’t have our quirks how the heck would we relate to our clients, and at the same time keep our sanity?So at the time of year when reflection is most appropriate, we felt it was important to share what we were reflecting on, and how grateful we are for your support! Here is to 2013, may it be as rewarding as 2012! Clear eyes, full hearts, can’t lose!
Tis the Season for Toys For Tots!
The Torrey Team is proud to be involved again this year with the annual Toys for Tots program! This nationwide program is sponsored by the United States Marine Corps and it provides toys to needy children during the holiday season. The Torrey Team is co-sponsoring their toy drive with family friend Stephanie Surls and will ensure that the Marine Corps training facility in Concord, CA will directly receive all donations. All toys collected will be distributed to needy children specifically in the local East Bay communities and this year they are expecting low numbers so please help!
New, unwrapped toys for children of all ages may be dropped off at the J. Rockcliff Realtors Walnut Creek office located at 1700 North Main Street or the Danville location at 15 Railroad Ave. Or you can drop toys at the Ace Hardware at 2967 Ygnacio Valley Rd in the Encina Grande shopping center in Walnut Creek. Monetary donations are also gratefully accepted in the form of a check made payable to Toys for Tots and mailed to Stephanie Surls at 49 Orchard Estates Drive, Walnut Creek, 94598.
Even the slightest bit of a donation can make a difference!
Hi Everybody! We all thought that once the summer ended and the kids went back to school that the East Bay's real estate market would begin to cool off. Wrong! It has been hotter than ever with multiple offers becoming the rule rather than the exception. List prices have become starting points for auctions which have actually become bidding wars driving up prices dramatically. We recently had eleven offers on a short sale that had its list price bid up almost 10%!
Our method for measuring the "temperature” of the market is the ratio of active listings to pending sales within the last 30 days - that tells us what's happening now. A "normal" market would have three active listings to one pending sale. Right now Concord has a ratio of .56, meaning that there are almost twice as many pending sales as there are listings! Antioch is not far behind at .63 listings per pending sales, followed by Walnut Creek at .84-that means there are more pending sales than homes for sale! Then we have Pleasant Hill at 1.1, Danville at 1.39, and Lamorinda at 1.78 listings per pending sale.
The main reason this is happening is the lack of inventory. We just haven't been building much over the last ten years and we don't have enough homes to sell. That trend is not unique to the East Bay; it is true all over the country. The record low interest rates are another factor in driving the market. The "shadow inventory" defined as the large stash of foreclosed homes the banks are holding is turning out to be more rumor than fact. Underwater homeowners are finding it much easier to short sale their homes if they pick the right realtor-thereby avoiding foreclosure.
Where are we headed? Good question, but I think the immediate future looks pretty good - at least through the Spring of 2013. Whichever party wins the election in November will face some hard decisions regarding taxes, the budget and jobs. In the past, the political party in power usually raises capital gains taxes to generate revenue because in their minds it seems the "least painful." For those of us who work in the real estate industry or for future sellers raising capital gains taxes could be very painful! Future buyers have to worry that the government's "quantitative easing" will cause inflation and much higher interest rates as they did in the 1980s.
The message here is that now is a good time to be both a seller and a buyer. If you plan to sell your home in the next 6 months get your plan together immediately, and if you are going to be a buyer after the first of the year pick out your lender and do your research NOW. You do not want to play the "shoulda, coulda, woulda" game a year from today!
23rd Annual Northgate Neighborhood Garage Sale is Coming Soon!
It is that time of year again! The Torrey Team is once again sponsoring and coordinating the 23rd annual Northgate Neighborhood Garage Sale! We expect this year to set yet another record for participants. So tell your friends and Northgate neighbors to plan to participate or attend on Saturday July 14th from 9am to 1pm. If you live in the Northgate area and would like to participate (for free) the sign up deadline is July 6th and you can either call 925-280-8535 or email Zack@TheTorreyTeam.com.
See you out there!
EAST BAY HOME PRICES HEADING UP
The media has finally discovered the improved housing market - a subject that we have been talking about since January. Headlines like "Housing Values Inch Back Up", "Bidding War-Pent Up Demand Fuels Buying Boom in East Bay", "Spring Fever Rouses Buyers" are very common these days.
It is not just a local phenomenon. Prices are going up nationally for the first time in seven years. Credit Suisse, an East Coast marketing firm which gathers opinions of active realtors, says that prices actually went up slightly between the months of February and March, ending a long period of decline. Remember that statistics always trail the market, so this data would be from sales that were agreed to in December of 2011 and January of this year. The fact that houses are selling in other parts of the country - not just here in the Bay Area - bodes well for the "mobility of the buyer/seller." Folks who want to move can actually sell their homes now. We are seeing more relocation buyers recently than we have in several years. We are also seeing a number of downsizing seniors, who have been waiting for the right time to sell the big family home, and move into something smaller - possibly in Rossmoor or elsewhere in the area.
What we haven't seen recently to this point are the "move-up buyers/sellers" - the growing family that needs more space, better schools, move convenient locale, etc. These folks generally need to sell before they buy. The concern these potential buyers have is "lack of inventory". They will ask "What if I sell and I have no place to go?" Inevitably, the number of homes on the market will grow to a point where these buyers will be more comfortable with their choices and jump into the market as they have in the past.
It is too early to tell if 2012 is going to be the beginning of a brand new positive era for local real estate - like 1999 where the property values jumped dramatically or more like 2009-10-11 when our spring rallies fizzled as the years went on. Geo-political events and the job market will have an impact on where we go from here, but even the gloomiest forecasters would concede that prices have hit bottom.
Short Sales Improving as Market Heats Up
As the market continues to be red hot we must also acknowledge how this will help many short sale sellers avoid the 2 biggest pitfalls of a successful sale.
First, a red hot market is going to increase the likelihood that a prudent seller with a good agent will get fair market value for their home that will be also acceptable to the short sale lien holder (bank evaluating the settlement for less than owed). This factor has been a huge one that has killed deal after deal as our market continued to adjust downward previously and the bank evaluators could not keep up with the times.
Second, the more competitive this market is, the less likely a buyer will get in contract on a short sale and "fall out of love" before the short sale decision is rendered. Many times buyers failed to live up to their obligation to be patient while the short sale seller they were in contract with diligently processed the application for sale with their lender. The buyer mentality was there were "plenty of fish in the sea." Now that inventory is down this mentality has changed to "I have a tiger by the tail and I better hang on." This has leveled the playing field in this aspect of the process and created a much more symbiotic relationship.
These two factors may make this market the most uniquely beneficial for short sale sellers we have seen in a long time. Don't miss this window of opportunity if a short sale is something you need to get done!
Market Sizzles with Multiple Offers!
Since the middle of January the Torrey Team has written 12 offers for buyers, and in 11 of those instances we encountered multiple offerings on the same property. We were able to obtain acceptances by sellers for our buyers on 9 of 11 offers we wrote! The response on the 12th offer is still pending. That tells us that the market has taken off this year and consumer confidence is way up here in the East Bay. It also tells us that we have a shortage of listings and potential sellers need to join the party.
So how have we been so successful in getting our offers accepted when there are multiple contracts? The key is knowing who we are negotiating with and what their primary motivation is. It is not always about price. Good listing agents really focus on the qualifications of the buyers as well as the experience and reputation of the buyers' agent. The multi-generational Torrey Team has closed approximately 150 transactions in the last 3 years, and has worked with many of the same agents on multiple occasions.
Communication and anticipation are important ingredients in winning the multiple offer negotiation. Preparing the buyer and the seller (or seller's agent) for what is about to occur is essential. Remember this could be a "once in a decade" occurrence for both. A short-sale seller is not nearly as concerned about price as he is about having a qualified and patient buyer who is willing to stay put during an elongated escrow period. The bank- owned listing agent is looking for a buyers' agent who is organized, efficient and technologically savvy. A traditional seller may have an occupancy need requiring a rent-back arrangement. Time and occupancy can be savings or dollars for somebody.
We have been very fortunate to be able to put this knowledge as well as other techniques to work for our clients in this complicated and ever-changing real estate market. That being said, the real key to our success has been YOU! We could not have accomplished any of this without your TRUST. Thank you! It was a wise man who once told Pete early in his career " trust is not given it is earned."
Rising Rents Help Housing Market?
There is strong evidence to show that this is a fact! For a variety of reasons--principally foreclosures, short sales and the lack of new construction--we saw residential rental rates skyrocket in the East Bay during the past year. This explains why the first-time buyers and the investors are particularly active home buyers right now.
Consider, for example, a typical purchase by a first-time buyer: a purchase price of $350,000 with 10% down, with financing at a 4.5% APR (which would likely include mortgage insurance). Add property taxes and hazard insurance, and the buyer might have a total monthly payment of $2047. Take into account the annual income tax savings, and the buyer's "effective total payment" might be around $1600 a month.
Compare that to today's rental market, where that same home might rent for $2200/month. The new home buyer saves $600 a month by buying instead of renting! That's money that could be used to cover a car payment, pay off student loans, or take care of some medical bills.
For investors, they want to see better returns for their 401k's and disposable incomes. They see rising rents as a great opportunity to create "passive income" and future financial security. Higher rental rates are now giving investors the "positive cash flows" in East Bay neighborhoods that they have been missing in recent years.
For the past several years, many of you have asked us for a prediction of when the real estate market will bottom out. We have said all along that it will bottom out when rising rents pass mortgage payments. As you can see by the above example, we've just whizzed by that stop sign. As a result, we may actually see some appreciating property values in 2012!
Sellers who have been waiting for the right time to sell should wait no longer. We've seen numerous multiple offers on listings recently because of the lack of good inventory. The next few months may be the best seller's market we have seen in some time!
Whether you're buying, selling, investing, or just curious about the market, we're here to help answer your questions. Just give us a call or send us an email.
The Torrey Team, January 2012
Marine Corps Toys for Tots drive
Happy Holidays Friends & Family!
The Torrey Team is proud to be involved this year with the annual Marine Corps Toys for Tots drive. Our client and long time friend Stephanie Surls along with her family having been major fund raisers over the past 20 years, and this year they asked for our help. Toys for Tots is a nationwide Marine Corps program that provides toys for the holidays for children whose families cannot afford them. By working with Stephanie we can insure that the Marine Corps training facility on Willow Pass Road in Concord will directly receive your donations and distribute to LOCAL families accordingly. This is where we can directly impact our community during a time of year when the slightest contribution is so greatly appreciated by the youth in our area. This year the Marines are reporting their numbers are way down which is why Stephanie reached out to us. So, we are asking that you either drop off new, unwrapped toys at one of the below locations, or send donations to Stephanie at the below address. Anything you can do will have major impact on less fortunate children – just picture all those little smiling faces!
Check's [Tax ID 501(C)(3)] made payable to Toys For Tots can be sent to Stephanie at 49 Orchard Estates Dr., Walnut Creek CA 94598
Or you can drop toys off at:
Bank of America:
Bank of The West
Ed's Mudville Grill
Pete's 1000th Transaction!
Thanks to my friends and clients for helping me to reach a career milestone - one thousand closed real estate transactions! I am pictured here with Una and Malcolm Adkins of Walnut Creek who were number 1000. 34 years has roared by, and you have made me enjoy coming to the office. I feel very lucky to have such loyal customers - many of whom I have represented for 3 generations. With Zack, Andrea and the family's help I am ready to begin my 2nd 34 years in real estate thanks to you!
Dude! Wuzzup With Real Estate?
That is the question I get asked all the time whether it be in the grocery store, barber's chair, or a buyer/seller conference. I answer by saying it is a lot more stable than the media would have you believe. I also say that the market is all about "location." Some market locations around the nation are in the toilet while other areas like Marin County in the Bay Area are actually showing price appreciation over the past year.
The New Normal
Pending sales for the month of May were up across the board in the East Bay after a slow April. Everybody seems to have their own theories about this quick turnaround and here's mine: it's called the NEW NORMAL.
June Newsletter, 2011
Our local real estate market is suffering from a lack of good inventory, and this has created an excellent opportunity for sellers who have been waiting for the right time to put their homes on the market.
It's About Price
Short Sales are a Part of our New Reality
99.5% Sold to list Ratio
Hi everyone! We are seeing several signs on the street that prices are starting to firm up. The last three sales of Torrey Team listings are an indication of that for us. They sold for an average of 99.5% of asking price which was our same percentage as last spring when we had large tax incentives.
Real Estate is Back!! Hi Everybody!
Short Sales Require Perseverance
Why 2011 May Be End of Housing Slump
I recently saw a very interesting article in the Wall Street Journal that indicates that this will be the "turn-around" year in housing. Since good news about housing has been rare, particularly on a national basis, I thought it might be worthwhile to pass this along. Here are some of the major points:
March Newsletter, 2011
We are really excited about 2011! Thanks to you it has started off quite well for the Torrey Team.
January Newsletter, 2011
We hope you are all happy and healthy and looking forward to 2011 with gusto and enthusiasm!
Downsizing Opportunities Exist for Empty-Nesters
Recently we have met with a number of you who are over age 50 to discuss your futures with regard to your real estate -- specifically, where you would like to live and whether you feel you can afford it. We are hearing that most of you "empty-nesters" would like to stay in the East Bay, but your kids are grown and no longer live at home, the home you currently live in is too big and you’re spending too much of your weekends working on your large yard. You would like to travel, possibly retire, spend more time on your hobbies, and have more fun. The question is how do you use your hard earned equity to improve your lifestyle? How much has the value of your home gone down since 2007? Where could you move to? These are the most-asked questions that we encounter.
Flat Market Continues
The real estate market continues to remain flat, with the good news and the bad news balancing one another. Interest rates continue to hover near record lows -- less than 5% for 30-year fixed-rate mortgages.
The "W-Shaped" Recovery
The real estate market continues a "W-shaped" recovery, with several steps forward and several steps back, depending on which day you choose to look at it. The good and bad news items continue to balance each other -- creating "stability" of all things by giving buyers and sellers equal opportunities. For buyers with good credit and cash or equity in their homes, these are great times. For sellers with equity, these are also good times.
It looks like Spring has finally arrived
The Torrey Team continues to be very busy, just as we were through 2009. Zack and I feel very lucky that Andrea joined us last Fall. Besides adding her enthusiasm, people knowledge, and marketing background to our team, she has brought great energy!
What To Expect in 2010
I think the healing process that began in mid-year 2009 will continue in 2010. Prices will continue to stabilize with the possibility of some slight appreciation in certain areas of the East Bay particularly Concord in the 200k to 400k price range. This year will have some similarities to 1997 when we were beginning to come out of the economic malaise of the 1990s-we have to stay flat before we begin to move forward. As an impatient society we are conditioned to labels like "hot and cold, off and on, black and white, in and out, Red States and Blue States etc." The real estate scene in 2010 will be none of those-it will be somewhere in between. We still have a backlog of foreclosure activity to wade through which will mean that we will see more bank-owned and short-sale listings in the upcoming year and probably well in to at least 2012. The good news is the interest rates, currently around 5% thanks to an accommodating Federal Reserve. They will probably hold fairly steady until the federal incentives expire at mid-year at which time they will probably climb to the 6% to 7% range by the end of 2010. By historical standards those are still very attractive interest rates but not what have been used to recently. The unemployment rate will probably increase slightly at the beginning of the year but ease in to the single digits by mid-year. At about the time the federal housing stimulus programs run out, I think the politicians in Washington feel job market picture will begin to brighten, thereby balancing the economic climate. I really believe that getting people back to work is the key to getting through this period. Those employed folks will feel more comfortable with large purchases like homes and autos. Existing home sales in 2010 should be slightly better than 2009, but new home sales and construction will remain at record low levels due to the lack of credit availability for builders. The lack of new construction in recent years means that we are going to have a lack of new inventory for the consumers in 2010 through at least 2012. This phenomenon could help push the prices of existing homes up just like 1999 through 2005. I like to think of the glass as "half full" rather than "half empty." Thanks to you 2009 was the best year the Torrey Team has ever had with over 50 homes sold! Let's make 2010 a great year!
Pete's July 09 RE Update
The real estate market continues to both confuse and surprise consumers. Sales have been dramatically up recently in the period from May 16th through June 15th, and they have been since April. Our J. Rockcliff Corporate Office reports that in the period from May 16th through June 15th Walnut Creek sales were up 33%, Lafayette 40%, San Ramon 32%, Livermore 18%, Blackhawk 14%, and Pleasanton is up 54%! The entire region saw a 16% jump in sales. Combine that with a listing inventory reduction of 14% and you have a climate that can provide opportunities for potential sellers. Zack and I can bear those statistics out as we are having our best year as a team with 28 sales in the first half of 2009. So, can we call this a seller's market? It really depends on the price range. The $300,000 price range in Concord and the $500,000 price range in Walnut Creek for instance are strong seller's markets with numerous multiple offer transactions. If you go over the million dollar mark in Walnut Creek, Danville and Alamo and you have a buyer's market with plenty of available inventory. Put two and two together and you can see that suddenly opportunities are opening up for move-up buyers who can sell in a more friendly climate, take their equity and purchase an upper end home at a steep discount. It is true that today's real estate consumers have to deal with a skittish stock market, lousy but expected unemployment figures, and news media stories of the Bernie Madoff Scam Artist types. But make no mistake, with interest rates of around 5% these are the best of times for buyers and for sellers who are also buyers!
A New Way to Buy Foreclosures - "Linebacker Real Estate"
The media has done an excellent job in making the process of buying Bank Owned and Foreclosed properties out to be a simple task. They throw statistics at you that show thousands of properties that can be purchased for far less than they were formerly worth. While this has some truth to it, the reality is far more complicated. This market is the land of opportunity for the well informed, and the well represented. However, it is full of major complications that can cost a buyer thousands of dollars if they are not careful. It is for this reason that I have developed my Linebacker Real Estate technique, giving my buyers the distinct advantage. I am a former Linebacker, varsity football Defensive Coordinator, and Linebackers Coach, so this analogy was the best way I could articulate this system. Let me elaborate; as a Linebacker on the football field your job is to shed the blocks of your opposing teams players so you can make a tackle on the ball carrier. Good Linebackers are able to shed multiple blocks and make a lot of tackles, some of which are behind the line of scrimmage and resulting in a loss of yardage for the opposing team. If you apply this same technique to the real estate world you will see the similarities. The opposing teams blockers are the properties that are for sale with unrealistic prices, unrealistic sellers, unable sellers due to financial duress, short sales, pre-foreclosures, and so on. The great deals, (or the tackles behind the line of scrimmage), are the ready, willing, and able sellers who are motivated - like Bank Owned properties, concluded Foreclosures. These are where the big savings are had, if you know how to negotiate with these entities. They are not normal transactions; they are extremely complicated due to timeframes, disclosure obligations of the seller, title insurance, inspection result negotiation, closing costs, and more. However, my Linebacker Real Estate technique is battled tested, with insight from Realtors who specialize in listing Bank Owned Properties, Foreclosures, and Auction properties. I have taken that behind the scenes information and developed a game plan that weeds out the bad properties, (or sheds the blockers), and narrows down the really motivated sellers who want to make a deal. I then present my offers in such a way to allow for my client to squeeze the maximum they can from the seller, both in the initial offer negotiation, and in the inspections portion of the transaction. All the while I am hands on with guiding my clients through the sometimes confusing and long process of closing the escrow. If you would like more information regarding this cutting edge Linebacker Real Estate technique email me at Zack@TheTorreyTeam.com, or visit my website at http://www.thetorreyteam.com/. Let's get in the game and make some tackles!
The Hidden Lakes Real Estate Expert
The Torrey Team, Pete and Zack Torrey, have been selling homes in the area of Hidden Lakes in Martinez to satisfied customers since the 1970s. We believe Hidden Lakes is arguably the best "bang for buck" in the East Bay. The Hidden Lakes Community is bordered by the 62 acre Hidden Valley Park offering hiking, biking, fishing and numerous outdoor activities, because of the mild climate. It is located in Martinez on the Pleasant Hill border. Security Owners Corporation headed up by James Busby built Hidden Lakes in the 1970s and 1980s as part of a 1500 home master planned community in what was then called "Muir Country." Homeowners love the wonderful family atmosphere and the excellent schools nearby including Hidden Valley Elementary School, Valley View Middle and College Park High School. Highly -ranked Diablo Valley Junior College is just minutes from your door. Sun Valley Mall, shopping and all commute routes are all easily accessible.
The Northgate Area Real Estate Experts
The Torrey Team has sold about 400 Northgate homes to satisfied customers since 1977. While we have moved many people out of the area due to job transfers, we have also moved many of the same folks back. Let us show and tell you why we chose to raise our families here and why we love it so much: