The Million Dollar Townhouse

The title above says it…but I’m sure plenty of you (me too!) can’t quite wrap our heads around it. That’s the prospect of townhouses in Foster City selling routinely for $1,000,000. Surely you jest you say! I clearly remember selling a townhouse on Juno Lane in Isle Cove that we listed for $395,000 and got the astonishing price of $402,000 for. We were absolutely amazed and I recall a neighbor being sort of annoyed with me because he thought we were crazy to be asking such an outrageous sum as $395,000 in the first place. I was clearly an idiot in his eyes.

Now we’re seriously looking at those same townhouses approaching the 1 million dollar mark…and I don’t think it’ll be long until that happens. Of course they’re already there at Promontory Point…but I’m not talking about Promontory Point! I’m talking about Winston Square and Bayfront Court and Bay Vista and Treasure Isle. Don’t believe me? Since the first of 2014 two units have gone over $900,000. A waterfront at 1115 Lord Ivelson sold for $930,000 (but the waterfront thing is sort of expected) and a unit in Treasure Isle at $728 Chebec that was listed for $868,000 sold for $955,000. That’s NON WATERFRONT townhouses.

Right now we have pending sales at 845 Balboa (Water…listed for $899,888), 391 Catamaran (No water…listed for $865,000) and 881 Cabot (no water…listed for $858,888). They’re all going to close over asking. I can’t wait to see where. It might not be this month or next…but sometime this year we’ll see a closing at or over a million for one of these townhouses. That’s absolutely freaking unbelievable! What’s more incredible though is the fact that we’ll get used to it and the standard for townhouses will be a million dollars. Just like the standard for single family homes is now about $1,300,000 in Foster City. You can be sure I’ll report on the first one that does…and don’t be surprised if it’s sooner rather than later.

 

Hitting Them Where They Ain’t

It’s an old baseball expression. Willie Keeler played from 1892 to 1910 and had an amazing career batting average of .341. When asked to offer advice to young hitters Keeler said “Hit em where they ain’t”. Simple huh? Easier said than done too.

So yesterday I started to think about the transactions I completed this year and I can’t tell you how grateful I’ve been to have had a good number of listings in 2013. 14 out of the 24 deals I had were listings. Lots of agents I know that didn’t have listings had a terrible year. Of the 24 sales 18 of them were in multiple offer situations. That leaves 6 that weren’t and the more I thought about that…and those clients I realized that in 5 of those 6 cases the buyers who got them hit them where they ain’t. In other words they had no competition and just by staying on top of the market and it’s inventory these buyers won the day. There were many circumstances, deals that had fallen apart leaving the listing back on the market again, a better house a few blocks away that drew buyers attention to this not quite as good house and just plain luck in the seller didn’t want to wait to look at offers. The point is that there ARE homes out there selling without a feeding frenzy, in decent locations and that are good deals…if you’re diligent, patient and ON TOP OF THE MARKET.

I think that’s a very important point. You need to be constantly analyzing the inventory and market data to accomplish this. Obviously a good agent can help you with this, but don’t get frustrated an quit because you’ve written 17 offers in competition and missed on them all. It’ll happen…look for ways to hit en where they aint.

 

What a Business!

This real estate thing is such and amazing business. Sometimes it seems that anybody can do it, huh? Well, almost anybody. One who doesn’t seem able to do it is actually on the market now on Tiller in Bayfront Court. It’s a short sale priced at $775,000…which is interesting since the most money paid for this floor plan came earlier this year at $828,000. Another unit sold for $800,000. Since short sales are such a huge pain $775,000 doesn’t seem like a big discount to me…but what do I know. To make it more fun there’s a few more details of it’s listing salability that I couldn’t help notice and remark on.

1. It’s listed as a single family home instead of a townhouse…which it is

2. The listing is offering a total of 1% commission to the buyers agent

3. There’s only one photo in the MLS and it’s of the open garage doors

4. It’s tenant occupied and there’s no lock box

5. The listing agent is in Los Angeles

A short sale with all of these marketing features. Oy! This is really going to be interesting to watch.

Reversion

Well, we’ve actually regressed. OK, the year is winding down and all that but as it’s gotten a little slower I would have expected that the level of inventory would have risen. Fat chance! This doesn’t bode particularly well for 2014 by the way. As of tonight there’s a whopping 4 active single family houses listed in Foster City. The lowest priced one is the place pictured above at 508 Gibraltar. It’s 3 bedroom, 2.5 bath house listed for $1,188,000. Offers are tomorrow. It’s almost unimaginable to me that we’ve gone so long now with such little inventory. Making it even weirder, there’s 5 condo/townhouses on the market. Huh?

Even with the market ebbs and flows there just doesn’t seem to be any way for values to flatten or fall if there’s this low amount of inventory consistently. If you’re a homeowner considering selling this is pretty good news for you. It’s not particularly great if you want to move up and stay here but it’s still better than buyers moving in here. It’s most likely going to continue to be competitive.

How High is High?

Now admit it…sometimes buying a house around here feels a lot like this guy feels pictured above. Probably scarier actually. The question is…how high can it go? I said houses…that goes just as well for condos and townhouses right now. Earlier this year I had planned on listing the townhouse at 808 Volans for $699,000. That was in February. My client had a change of mind and decided to wait. When they were ready to go in September we listed for $789,000. We got multiple offers and it went well over that. When it closes it’ll represent by far the most money ever spent for a non water front unit in Isle Cove. Amazing! How high can it go there. Heck a water front townhouse at Isle Cove just closed for $930,000!

I still can’t get over how long it’s been since a single family house sold for less than $1,000,000. Actually it was July 10 at $850 Pollux. Incredible! I swear it really seems like yesterday that the vast majority of single family homes sold under $1mil. I don’t have an answer for how and when and why it stops…or even slows down significantly. I’m really not sure it’s EVER going to really depreciate. I don’t believe our market is a bubble. everybody has significant downpayment…we’re just not going to get a bunch of short sales and foreclosures from this crop. I guess we’ll just have to wait and see.

The Swami Knows

There’s been this funny and somewhat new phenomenon that I keep experiencing. People, particularly those that I meet at Open Houses I’m holding seem to think I know stuff. Actually they probably aren’t too sure about whether I know stuff about the things that I really do know stuff…but they’re certain that I know things about stuff that I have no clue about. Make sense? Simple right?

I guess what I mean is that folks ask me questions about the market, or the property in question, or the project the property is in and even though I do indeed have the answers they’re sort of suspect of me. I’m a realtor after all. A salesperson. Obviously what I say is met with some suspicion? What’s funny though is this question that I seem to be getting a lot on my listings:

” How much do you anticipate this place is going to sell for?”

Over at my listing at 808 Volans in Isle Cove I had this question twice on Saturday alone. In answer to that I said:

” I have no idea”. To which the buyers look at me with incredulity and, after a pause, said “Oh, come on…you MUST know what this place will sell for!”

Umm…No, I don’t have a crystal ball and I’m not a Swami. I have no ability to predict the future or do I have any idea whatsoever what interested buyers that I don’t know are thinking about writing on my listing. Honest. I’ll say it again…I do not have supernatural powers that allow me to know these details. Sorry.

Maybe it’s my ever increasing gray hair? Maybe it’s because some folks in FC read this blog? Whatever it is some of these folks have some certainty that I know stuff like this. I really don’t. In fact I’ve had a bunch of listings this year and I think I guessed wrong on just about all of them. It’s kind of a nice thing when it’s your listing your wrong about…and the price goes way over your expectations.

Here’s something else I’m just about positive about. None of those other listing agents have any clue either. I’m reasonably safe in saying that the agent at 294 Devonshire in San Carlos didn’t predict her $998,000 2 bedroom listing would get an offer of $1,630,000. Everybody’s surprised by this kooky market.

 

Who Knows?

 

 

I’ve been a realtor around here for 23 years. In many ways I have a clue. I have a bunch of experience actually and that’s quite often helpful to my clients. I know a whole lot of other experienced agents around these parts too and they have sort of a clue as well. Wouldn’t you think that experience would count for something? I’m joking around here…for the most part. What’s confounding me lately is knowing what to tell a buyer about what to offer in a multiple offer scenario. I have to tell you the truth. Most of the time I really have no clue. You know what else? I don’t really know ANYBODY that really does either. I heard one agent say that you just pick a dollar amount that seems really preposterous…and then DOUBLE IT. I’m not sure if he was joking or not?

A couple of weeks ago I advised some clients that the 2 bedroom, 1 bath house on the 16,000 sq ft lot on Devonshire in San Carlos. It was listed for $998,000. I thought it would go way over asking and told them my bet was $1,250,000. My clients were afraid of going that high so we wrote a lower offer. The house sold for $1,630,000…cash. Go figure! A couple of days ago a large 3 bedroom house on Bennington on San Mateo came up listed for $1,495,000. It was a big house though…so what if nothing has sold up there EVER for anywhere near that price. It ended up selling for $1,625,000…cash. Again.

I myself had a little 2 bedroom, 1 bath listing on Sylvan in San Carlos a few weeks ago. The most money ever spent for this floorplan? $725,000…and that was a month ago! We got $787,000. Again…go figure! Is there a point? Who knows is the point. that joke my coworker made is pretty much true. Think of a really ridiculous offer price…and double it!

Rant and Rave

 

 

 

I seem to go off on a rant from time to time…so why not again now? So a friend of mine told me about this couple that’s “just dying” to buy a house around here. He told me about them about 5 months ago actually, and he actually made the introduction for us this past weekend. Nice couple. The young guy proceeded to tell me that he has a somewhat different philosophy about home buying. He’s going to do it himself. He really doesn’t need an agent. He’ll identify a house and go get an attorney to write the offer. He didn’t really find Redfin or another discounter to be a fit for him because he’s heard that listing agents don’t like Redfin so they don’t play with them. He’d rather do it himself.

I occasionally hear stories about buyers that approach agents wanting to write an offer themselves. Usually those stories provide plenty of laughs in my circle of co workers…mostly because the buyer in question is SO spectacularly clueless when it comes to doing what’s necessary to buy a home. The amount of information needed to actually win in a bidding war by any buyer WITH an agent is enormous. A buyer wanting to represent themselves is a lot like a dog chasing a moving car. It would have no idea what to do with it even if it catches it! Which only happens if the car stops! A house in momentum doesn’t stop. I just can’t imagine any buyer truly understanding disclosures, inspections, construction, loans, escrow or the simple notion of negotiating with a listing agent. At the core of it all in this buyers consciousness is contempt for realtors if you ask me. The buyer thinks he can leverage the commission to his benefit and he also thinks the process is so easy to manage that he can become fully competent with the process by doing some searches on Google.

The idea is simply absurd. I don’t care what the profession is…I could never learn to refinish hardwood floors, represent myself in court, fill a cavity, build an addition onto my house or even cook a spectacular French meal by working through an online tutorial. Why would anybody think they can buy a house fully on their own? Sorry about the rant. I know it’s stupid to take this stuff personally…but to some degree I do. Again…sorry.

Exhaustion

You’ve been busting your butt looking at homes for most of this year since you decided that buying was the path you would take last fall. You’ve spent hours searching online. You really had no idea it would be like this in 2013, you thought your timing was perfect…unfortunately everybody else thought the same thing. You’ve looked at just about every open house possible and certainly you’ve seen everything that’s come available in your price range. You’ve read countless disclosures, seen almost unlimited virtual tours and been driven crazy by a number of realtors…maybe even your own. Probably, you’ve written several offers….and you’re really exhausted! It’s too darn much! You just want to get settled and start living life. It’s really hard if you’re an FHA buyer because you’ve got less than 20% down payment and you’ve been competing against folks who are offering cash or huge down payments. You need a break, huh? You want to give up.

It’s really understandable. Many people are in the same situation. Nobody expected that the inventory would be this lean in 2013 or that so many people would enter the market place. Lots of folks right now feel like taking a break from all this stress and anxiety. I have clients of my own that have expressed the idea of waiting for next year to see how it develops. I completely understand, but I really think that waiting doesn’t solve anything. All those reasons you wanted to buy a place still exist today. Have rents been going down this year? I don’t think so. I don’t want to sound like a commercial, but I think the solution is to stay the course. Buying is the right thing to do. It’s a long hard process, but it’s worth it in the long run. It’s inevitable that the right place will come along if you have patience. Prices certainly don’t appear to be going anywhere but upward. Seriously, it’s hard to do what you’ve been doing…but hang in there. It’ll happen

Random Real Estate

Just some random thoughts from the last few days;

 

One of my agent friends gets 10 offers on a listing of hers in San Mateo. All of them wildly good and it ends up selling for $202,000 over asking. She also gets a verbal offer from a guy. She tells him she needs the offers in writing. He says he knows all about real estate and, in fact, doesn’t need to write an offer…a verbal is perfectly fine. His verbal offer is at the asking price and he informs my friend that the house is overpriced at asking and anybody would be crazy to offer more. Apparently there were 10 groups of people that need to be locked up. I have one word that I think perfectly describes this particular buyer….IDIOT.

I’m chatting with a hardwood floor guy I know who tells me about a job that he did on a listing that was in escrow where the seller decided a week prior to closing that he wasn’t going to pay the commission he’s agreed to on his contract. He wanted to renegotiate or he wouldn’t sign. The commission amount is published in the MLS. Holding a transaction hostage over an agreed upon commission is , how shall I put it…kind of skanky. I have a word that I think perfectly describes this particular seller…but I won’t publish it. It is sort of like the one above, but more profane.

A property inspector I work with told me a story about some folks who lost out on a house in the multiple offer environment who found out which buyers actually finished first…and offered them $100,000 to back out of that deal in favor of them. Amazing, huh? What would you do?

As always happens, holding an open house is an amazing experience. You hear the darndest things. While I’m standing in the living room of my listing in San Carlos, a lady points to the front sliding glass door and asks “Is that a window?” How do you answer that? “No, it’s a door”. I say. I’m not sure where some of these questions come from? I honestly think telling the difference between a laminate floor like Pergo and hardwood couldn’t be more obvious…but I’m wrong. I frequently have people ask me if Pergo is hardwood. To me it’s like asking if the concrete sidewalk is hardwood. Sorry if I sound like a jerk.

I also think a new roof is incredibly obvious vs an old one…but people always ask that too. Usually the old roof is clear…but new ones look just as obvious to me. Others can’t tell the difference.

Anyway…I’m rambling. Randomness!