Your Exceptional Life

I’ve said this before, but it bears repeating. The real estate market is like San Francisco weather. If you don’t like the real estate market, just wait 10 minutes. By the time the news media catches up to what’s happening, it’s happened and we’re on to something else. If you saw it on the television, it’s yesterday’s news. That $200,000 screaming deal in Hayward? Gone. I sold several of them, but that deal isn’t there anymore. There’s a conga line out the door of those properties now and the price is being driven up. And they’re in terrible condition. What a lot of people didn’t understand was that $200k “deal” in Hayward was not move in condition. It generally came with a cracked foundation, subterranean termites, mold, missing appliances, a leaky roof and a roach and rat infestation. Furthermore, they aren’t selling for under asking any more. They aren’t even selling for asking. They’re getting bid up. That portion of the market is stabilizing. Last month a home that was very popular, fell out of escrow. It was my broker’s listing, so I knew it fell out before it hit the MLS again. I called a guy who was red hot for that property and said “Look, if you want it we have to write it now”. His response “How can you expect me to make a decision in a day about a transaction this large?” I told him it didn’t matter to me, if he didn’t want to make the decision in a day he didn’t have to, but he wasn’t going to get the house either. He didn’t get the house. He still doesn’t have a house and the neighborhood he was looking in has passed him by. I doubt he’s going to ever get into this market. The opportunities are on a train out of town right now while he stands motionless on the platform.

What I’m seeing is Hayward low end stabilizing. Concord’s low end is stabilizing too. Neither is rising, they’re just stabilizing. Oakland is a giant food fight. If you’re not willing to throw down, you’re just going to get roughed up in that market. In Oakland in particular, I’ve noticed that sellers and agents are pricing properties deliberately low in hopes of creating a frenzy and driving up the price. I think this practice is obnoxious. I’ve seen properties bid up $90k over asking in Oakland in the last three months. Those properties were improperly priced. Things aren’t what they appear to be in Oaktown.

The tide is turning on some of the selling practices too. Three months ago the bank/seller wouldn’t even consider replacing a stolen stove. Now we’re seeing them make the insurance claim and getting the appliance installed. I think the party is over on this one. Thousands of foreclosed owners sold thousands of appliances on craigslist. I think that it’s just a matter of time before the banks say “Enough” and start filing police reports. I have a house that the former owner vandalized on Monday night as they moved out. I’ll be picking up the police report on that one next week. I think some folks are going to be very surprised to have ruined credit and a criminal record. I had a friend ask me about that one a couple of weeks ago. Her husband was going to give parts of the house to his brother-in-law who was doing some remodeling of income property. She was worried and rightly so. I just asked her “do you want to be the person who did that?” She didn’t. I told her I was concerned that the banks were taking steps to end these practices behind the scene and that they were going to start pursuing and catching people in the act. The brother-in-law got his stuff on sale at Yardbirds.

There’s only one way to keep up with what’s actually happening in the market. Hire a realtor who’s working in the market. What you hear on the news and what somebody tells you at a cocktail party is interesting, but it might very well be yesterday’s news.