The High Cost of Overpricing
December 28, 2009 by Debbie Bremner · View Comments
This is generally the time of year when potential home sellers begin to think about putting their home on the market. Along with making plans for minor improvements and staging, sellers often wonder, “How do I decide on appropriate pricing for my home?”
Statistics show that overpriced homes remain on the market much longer, and the longer a house is on the market, the lower its eventual selling price is, relative to its asking price.
The most critical step in preparing to market a home is determining the right listing price. Of course, every seller, and every agent, shares a goal of getting the highest possible selling price for the home. That’s why it’s so important to strategically price initial listings for maximum results, and avoid the dangers of overpricing.
The right price produces the right return. Underpricing a listing may not bring the highest return, but neither will pricing a listing too high. And marketing strategy matters as well.
• When a price is too high, buyers will often bypass the listing, believing that it is out of their price range.
• Those who are looking in that price range may see the property, and deem it a poor value based on its competitors.
• Agents are often reluctant to show an overpriced property, except perhaps to make a competing one look better.
Sellers often ask me, “Can’t I test the market first at a higher price, then reduce if it doesn’t sell?” Many sellers are tempted to test a high initial listing price in the hopes of making an exceptional sale. While this may seem like a harmless, low risk tactic, it can be very detrimental to the sale of the property, actually driving the eventual sale price down instead of up. Why?
• Properties receive their greatest exposure in the first 21 days, when they are perceived as “fresh” to the market.
• Your best and most motivated buyers will likely see it during this initial period and reject the overpricing.
• Most buyers never return to see a home, even when the price is reduced; once they form an opinion of the home, it is view through the eyes of “not good value”, and agents have a hard time changing that first impression.
• In a declining market, your property will actually be going down in value during its listing period. In addition, appraisers penalize your property when it is on the market for an extended period of time, marking it as “declining value”, and making the appraisal process more difficult.
Seller action steps for pricing:
• Get a complete analysis of market conditions and comparable properties (CMA).
• Make sure your analysis includes the percentage of price sold (PPS) vs. listing price. Your Realtor® will have that data.
• Once you know the value of your home and the PPS, you must keep your asking price within that range in order to be competitive.
• Set a marketing plan that takes full advantage of your well priced home.
Have any questions? Feel free to call or contact us here at The Bremner Group.
Loan Modifications- How Realtors Can Help
September 12, 2009 by Debbie Bremner · View Comments
As homeowners and Realtors know, foreclosure are eating away at the fabric of the local real estate market, putting families on the street and wreaking havoc with the values of properties in their neighborhoods. In many areas, whole blocks have been decimated by foreclosures. The mortgage industry has responded to skyrocketing foreclosure rates by increasing their outreach efforts and offering loan modifications prior to foreclosures.
For the last few months, I have had the pleasure of working with a homeowner counseling firm in addition to my work as a Realtor. We work with many of the nation’s largest mortgage servicers, primary mortgage insurers, government agencies and counseling agencies to facilitate communication with homeowners facing foreclosure, before it is too late. As an experienced real estate professional who cares about my community and has a vested interest in preserving home ownership, my job is to help the homeowner explore the option of loan modification with their lender. I am part of a nationwide network of Home Retention Consultants (HRCs) that ensures that homeowners understand their options to avoid foreclosure and help them through the process. There is absolutely NO COST INVOLVED for a client to work out their loan with any of the major lenders we represent (Wells Wachovia, CitiMortgage, B of A, etc)
Mortgage servicers are experts at managing loans and the related collections process. However, homeowners often view communications from servicers as rigid and intimidating. As a result, many homeowners never recognize the servicer’ desire to avoid foreclosure, and thus evade communications and never pursue an alternative to losing their home.
Homeowners want to stay in their homes. Servicers want homeowners to stay in their homes if at all possible. The realty is thousands of foreclosures every year that could have been prevented if only the proper doors were opened.
Home Retention Consultants are experienced, highly-trained real estate professionals who live in the communities they serve. The HRCs follow up with the process to make sure the borrower’s needs are being met.
Last week I met with a gentleman who was told, erroneously, that he needed to hire a third party firm’s service, at a cost of $2500, to complete a loan modification that the lender would have done FOR FREE. As a Realtor and a Home Retention Consultant, I am appalled that there are firms out there taking advantage of families in financial crisis, and extracting money from them, at a time when they don’t have it to spare. Shame on you!
As an HRC, I see clients at the most stressful of times, and I am able to help them. Lenders are reducing mortgage balances, interest rates, terms, and payments. Yesterday I met with a homeowner who was ecstatic to learn that their were options for his family that he had not begun to explore. I came to his home with a bona fide offer of a balance reduction of his loan, which lowered his monthly payment as well. He hugged me and said that this was one of the best surprises he had had in a long time. We called the lender, he accepted their offer, and the process was started, right then and there.
I plead with all homeowners to speak with their lender now while loan modifications are being done. Contact your Realtor, who can put you in touch with the right party to get the process started. Avoid third parties who will charge you fees for services that lenders are performing for free. Your Realtor will have the expertise to assist you in this, and will be happy to do so.
As Realtors, we have a vested interest in serving our community, not just when we take a listing or make a sale, but at any time when homeowners need our service. We can help stem the tide of foreclosures, and change our markets for the better, helping everyone in our community. Speak to your clients, and help them weather this financial storm. They will really appreciate you, and so will the community you serve.
Brentwood Market Update 9/7/09
September 7, 2009 by Debbie Bremner · View Comments
310 N Bundy Dr,Los Angeles, CA 90049
Just listed today, described as follows: Beautiful Bungalow in highly desirable area north of Sunset Blvd. Spacious & open living & dining rooms w/large picture windows that fill space w/light. Exquisite peg&grove floors. Large kitchen with new tile floors. Bathroom has separate tub & shower, new tile & new glass shower. Smooth ceilings. Central heat/AC. Gorgeously landscaped front yard. Large rear patio perfect for entertaining. Stairs lead to two level use areas in backyard with wonderful canyon views. Inside laundry & new exterior paint.
Interesting to you as a market snapshot: This property was on the market from 6/14/2002 until it was withdrawn on 4/3/2003, after 293 days on the market. At that time, it was priced at $969,000, and made 6 price reductions, until it was taken off the market at, drumroll please, $870,000! Can it sell this time at anywhere near to its asking price of $998,000? (This calculates to $740.00 per square foot, if you’re playing at home.) More interesting, it was purchased in April 1999 for $300,000.
Heffner, Spelling List Holmby Homes, New Little Holmby Listing
March 27, 2009 by Debbie Bremner · View Comments
Pocket Listing in Beverly Hills Flats, 2 Celebrity Homes, and 3 New Westwood/ Bel Air listings
Spelling Holmby Hills Mansion
This week saw lots of activity in listings on the Westside.
Hugh Hefner and his wife, Kimberley Conrad Hefner, who have lived in adjacent mansions since their 1999 separation, are listing Ms. Hefner’s Los Angeles home for $28 million. Located in Holmby Hills, the house stands next door to the Playboy mansion, Mr. Hefner’s massive, Tudor-style party-friendly home since the 1970s. Ms. Hefner, 1989’s Playmate of the Year, says she and Mr. Hefner bought the house about 10 years ago so that she could raise their two sons there, who are now college age. There’s a door in the wall between the two properties for easier access back and forth. The 1929 brick and wood English manor-style house, on 2.3 acres, measures 7,300 square feet and has a pool and a three-car garage. There’s extensive original wood paneling and a hand-carved staircase. Playboy Enterprises owns the Playboy mansion, but Mr. Hefner owns the house across the street, which he calls the Playmate Mansion.
Candy Spelling, the widow of television producer Aaron Spelling, is offering her Los Angeles mansion for $150 million, apparently the most expensive home for sale in the U.S. Ms. Spelling’s current, 57,000-square-foot house, dubbed “the Manor” and featured on guided tours of Hollywood mansions, includes a bowling alley, a beauty salon, a gift-wrapping room and a screening room whose screen rises out of the floor, with paintings moving up to reveal the projector.The Spellings bought the nearly five-acre property, at one time the home of Bing Crosby, in the early 1980s, tore down the house and rebuilt. When completed in 1991 it was considered the largest home in Los Angeles by far. Mr. Spelling, who produced a string of hits over five decades from “Charlie’s Angels” to “Beverly Hills, 90210,” died at the 123-room house in 2006 at age 83.
New to the market today are two Westwood homes, and one in lower Bel Air.
214 Ashdale Place
214 ASHDALE PL , LOS ANGELES ,CA 90049 is a newly constructed Mediterranean Revival Villa, and is a rare opportunity to own a lavish estate in Bel-Air. Old World charm built to exacting modern standards. Sited at the end of prime Bel-Air cul-de-sac & offers head on views to downtown in a lush canyon setting. The estate is very private, situated behind high walls & gates. All rooms are open onto a central courtyard or out to the pool. Amenities include a screening room, billiard room, gym & attached guest house.Spectacular master suite features sumptious finishes & all the trimmings. 6 Bedrooms, 10 Bathrooms, approximately 11,000 sq. ft. on a 32,890 sq. ft. lot. Offered at $9,350,000.
10715 Le Conte
10715 LE CONTE AVE , LOS ANGELES ,CA 90024 is a chrming country English home with wonderful details, located in Little Holmby. Built in 1933, the home is 3477 square feet on an 8189 square foot lot. The living room has high beamed ceilings and hardwood floors, and there is a formal dining room, 5 bedrooms and 5 baths. There are authentic Art Deco tiles in the guest bath. Remodeled kitchen is light and airy, and the downstairs also boasts a family room. The garage is currently used as a playroom. This is a truly elegant home, offered at $2,275,000.
2146 GLENDON AVE , LOS ANGELES ,CA 90025 is an immaculate 3 Bedroom, 1¾ Bath Spanish home that perfectly blends original charm with modern upgrades. North of Olympic Blvd and located in the Westwood Charter School District. Beautifully landscaped yard in desirable neighborhood. The living room has coved ceilings, hardwood floors and original fireplace and fixtures. Dining room with picture window. Kitchen and baths have been remodeled with Travertine tile and stainless steel appliances. Spa tub in redwood deck. Offered at $1,225,000. Also offered for lease for $4,950.
New Pocket listing in Beverly Hills Flats: A one story Spanish designed by noted architect Paul Williams is available in Beverly Hills. The property is 3 bedrooms plus a den, 2 baths, and needs updating. There is little yard. Offered at $1,400,000.
The home at 2207 Camden Ave., LA CA 90064 received a price reduction of 9.11% or $99,850, down to $995,900. The home was listed 2 months ago on 1/28/09 for $1,095,750 and this is the first price reduction of the listing term. According to the MLS, the home has 3 bedroom and 2 baths, on a 6,500 sq ft lot. It was previously purchased in 5/17/06 for $1,215,000. With this new reduction, the home is now listed 18% lower than the purchase price in 2006.
The property at 2201 Manning Ave., LA CA 90064 received a price reduction of 4.4% or $50,000, down to $1,079,000. The home was listed 3 weeks ago for $1,129,000. According to the MLS, the home is a 4 bedroom / 3 bath, 2,182 sq ft home on a 6,750 sq ft lot.
NEW BHPO POCKET LISTING
March 26, 2009 by Debbie Bremner · View Comments
Architectural Mini-Estate
Circa 1960 Architectural International style home done to the nines. Situated on a private, walled and gated lot. This home featured 2 bedrooms and a den (approximately 1,887 square feet, 2 updated bathrooms, a large living room, open dining room, sheets of glass, soaring, open entry, skylights, white hardwood floors, new top of the line with professional appliances and stainless steel counter tops, large deck, entertaining patios off the public rooms, and a modest, terraced grassy yard. A hip yet serene jewel surrounded by lush landscaping and located on a quiet cul de sac in prime lower BHPO. Wonderful condition, finishes and sophistication. Not to be missed at this price. $1,379,000
Market Metrics and Year to Date Westwood Neighborhood Update
March 26, 2009 by Debbie Bremner · View Comments
Market Update for the Week of March 25, 2009
Higher Loan Limits are on the Way
- FHA Financing up to $729,750 with as little as 3% down is now available in the market
- Conventional financing up to $729,750 has been approved for the credit agencies but the final pricing and guidelines are still probably two weeks away.
Now, what does the Westwood market look like? Well, the data from CLAW, the Westside Multiple Listing Sevice, is tabulated up to end of February. Here is a brief look at some of the most important reports. You can download the full size PDF’s here.
* The Number of For Sale Properties by Month
* The Number of Sold Properties by Month
* The Number of Under Contract Properties by Month
* The Number of New Properties Listed by Month
* Sold Price by Month
* Supply & Demand by Month
* The Average Days on Market by Month
* Months Supply of Inventory
- *
- Units For Sale
The Number of For Sale Properties By Month
There are 16% more properties for sale this year as compared to the same time 1 year ago. (Feb. ‘08, 158 single family homes, Feb.’09, 183) The bad news: more supply= less demand. The good news, however, is that this number is down from its high point in November of 2008, when there were 210 single family homes for sale in Westwood. So it seems that we are trending toward absorbing some of the excess inventory that has been sitting on the market.
Units Sold by Month
The Number of Sold Properties by Month
The news is that we are right on target with the amount of units that normally sell at this time of year. That’s great news overall, because market conditions are not preventing buyers from venturing into the market, as they normally do in the spring. Simulus packages, along with lower prices, foreclosures and REO properties, and record low interest rates are driving this trend.
Units Under Contract
The Number of Properties In Escrow by Month
27 homes went into escrow last February, while only 13 went pending this February. This may be the start of a trend, but the small sample makes it difficult to assess. I’m waiting to see how March looks, before interpreting this small data sample. It may be that we will have a better picture by using the first quarter numbers, due out at the first part of April. Stay tuned!
New To Market
The Number of New Properties Listed by Month
Feb-08 vs. Feb-09: The number of new properties was up 25% from a year ago. What will this mean to the Westwood market? There certainly is pent up buyer demand, but a sharp rise in inventory could signal another wave of price reductions as sellers compete for the buyer’s attention. Again, first quarter numbers will give a more complete assessment; however, there does seem to be a rise in the number of signs in yards, and the length of time on the market for most listings.
Tomorrow we will look at the rest of the Westwood data, and next week we’ll take a look at a Brentwood market snapshot.
Reduction in Little Holmby; WW Market News
March 25, 2009 by Debbie Bremner · View Comments
The home at 911 Hilts Ave , LA CA 90024 received a price reduction of 8% yesterday, or $3,150,000, down to $2,900,000. The home was listed just 20 days ago on 3/05/09 for $3,150,000 and this is the first price reduction of the listing term. According to the MLS, the home is a 6 bedroom / 5.5 bath, 4400 square feet on a 7623 sq ft lot.
The property at 2201 Manning Ave., LA CA 90064 received a price reduction of 4.4% or $50,000, down to $1,079,000. The home was listed a little over 2 weeks ago for $1,129,000. According to the MLS, the home is a 4 bedroom / 3 bath, 2,182 sq ft home on a 6,750 sq ft lot.
The home at 2207 Camden Ave., LA CA 90064 received a price reduction of 9.11% or $99,850, down to $995,900. The home was listed on 1/28/09 for $1,095,750 and this is the first price reduction since the home came on the market. According to the MLS, the home is a 3 bedroom / 2 bath, on a 6,500 sq ft lot. This listing was previously purchased in 5/17/06 for $1,215,000. With this new reduction, the home is now listed 18% lower than the purchase price in 2006.
In other market news this week, 2341 Veteran Ave , LA 90064 closed escrow yesterday. It was on the market for 150 days, since 10/1/2008, originally listed for $850,000. It went into escrow on 3/3/09, after two price reductions, first to $789,000 and then to $750,000. It finally sold for $710,000.
In addition, 2046 Glendon Ave , LA 90025 is in escrow. It went pending on 3/6/09 after only 18 days on the market. The list price was originally $949,000, with a reduction to $879,000 after the first two weeks. Stay tuned to find out what this one sells for.
It’s becoming apparent that in order to get those offers coming in,sellers in the Lower Westwood area have needed strong price reductions. It will be interesting to see how this affects the Little Holmby and Westwood Hills market.
New REO listing in Lower Westwood
March 20, 2009 by Debbie Bremner · View Comments
2326 Glendon Avenue, LA 90064
An REO foreclosure property is available in Lower Westwood, north of Pico Blvd. The home is a newer construction Mediterranean style home built, in 2005. The property is located at 2326 Glendon Ave., LA CA 90064. The home is a 5 bedroom, 5 bath with 3,894 sq ft on a 6,750 sq ft lot. Features include a large great room,custom kitchen, open floor plan. This house is ideal for someone wanting a good value in a good Westside location, with easy access to shopping, dining, and entertainment. I predict this will not last long, despite the condition, because it’s a great opportunity. (The prior owners tore out a lot of the cabinetry, fixtures, appliances, etc. prior to handing the property back to the lender. Bank owned properties have ofter been pillaged by their previous owners!) The bank notes that the property is being sold “As-Is”, without warranty. The home was previously sold new in 2006 for $1,985,000. The bank is now asking $1,700,000. Non FHA offers with 10% or less down and borrowers with FICO scores under 720 will not be considered by the bank. For more information, contact The Bremner Group at 310-571-1364.
Why You Should Care About Pocket Listings
March 18, 2009 by Debbie Bremner · View Comments
Secret Sales
I’ve been getting lots of mail recently, from homeowners and agents alike, asking why I bother to post information about “pocket listings”, those properties that are for sale, but not in the MLS. Even agents as far away as New York and Toronto have contacted me on Twitter and Facebook, asking why we seem to have so many pocket listings in Santa Monica, Brentwood, Westwood, and Beverly Hills.
But most importantly, what do all of these private sales mean to you, and the value of your home, as a seller, or as a buyer, or even just as a spectator? What do you need to know about the Westside market now?
In a recent blog post, “Appraisals Compromised due to Lack of Comps“, I spoke about the fact that appraisers in the Westside market have been hamstrung in their price justifications due to the dearth of good comparable sales. This has led to some questionable tactics in assessing value, not just for purchase money, but for refinances as well.
The Westside of Los Angeles has had a steadily percolating undercurrent of sales throughout the last 6 months, most of which have not made it into the MLS, a prime resource for appraisers and agents alike. If one is unaware of those private sales, they are missing vital information about the real complexion of the market now.
One interesting factor is the perception that “nothing is selling”, when in fact, quite a few homes sell each week through private sale. However, those properties will never have a sign, will never be advertised online or in the paper, so the general public may never know. There is more activity in the market than you may know. For you homeowners, this is a positive sign, and for you buyers, well, a change may be coming!
As a home buyer, you will want the opportunity to look at all properties on the market. You don’t want to be limited to re-sales, REO’s , or short sales. In fact, some of the best properties never see the general market. You must select a Realtor who knows intimately the specific areas you are looking for, and has access to those pocket listings. Regardless of what property you buy, you should have an accurate sense of the true value of the market and neighborhood, and knowing all of the sales s the only way to accomplish this.
As a homeowner, you must have this information to accurately assess your home’s value in this admittedly turbulent market. This is doubly true if you need to refinance your home, and your appraiser has no access to this hidden information. Before you select a mortgage broker, lender, or appraiser, as how they are tracking “pocket listings” and private sales. If you are about to put your home on the market, be sure the Realtor you choose has a good network that allows them to get access to this information. Ask the question up front, because the answer can be worth real dollars to you in the end.
Beautiful, Affordable Pocket Listing in Westwood
March 18, 2009 by Debbie Bremner · View Comments
A taste of Provence in an affordable Westwood home. Located south of Wilshire, minutes from UCLA and Westwood Villiage, this home is not only close to hip restaurants, shops and theaters, but is proud of its neighborhood public elementary school, which is one of the best in the City. This 3 bedroom, 3.5 bath home is offered at $1,499,000. The hose is approximately 2000 square feet, and the lot size is 50 x 130. Featuring Pierre Deaux fabrics, custom cabinets, etc. Tres chic!
For more information, contact Debbie Bremner @ TheBremnerGroup.com, 310-571-1364.
