Choosing a real estate agent you might actually have success with.

Signs you should be looking for when interviewing an agent that will guarantee you success.

1. Cut through the sales hype. Ask about their values, approach to business, and see if they take the time to really inquire about what is most important to you. Boastful agents don't generally care about you, they care about getting another listing under their belt how it makes them look.

2. Seek out an agent that is respected in the industry and has a good relationship with the offices they have worked for and their past clients. Ask to speak to their past clients!

3. Find out who you will actually be working with. Big flashy teams and agents with the most sales don't generally have one-on-one time for a personal white glove service experience. Often times you're passed off to an assistant or newbie team member, which doesn't necessarily guarantee a top level experience.

4. Ask if they will reduce their commission (but don't work with any agent who does reduce it!). They should say no, or at the very least put up a fight. If an agent won't fight for their own money, why would they fight for yours?

5. Choose an agent with a large real estate network. An agent with an International presence and network of offices and agents have more resources to make your home sale happen.

Ready to schedule a consultation? 

Now is the time. Feel free to contact me direct by phone 951-207-5454 or email ls@laurenshepherd.com

The New Age of Marketing Your Home for Sale

According to the National Association of Realtors, in 2020, 91% of home buyers found the home they purchased through one of the following: a real estate agent, a yard or open house sign, or online. This means 3 very important things.

1. Agents are still incredibly important during the home search process. Your agent should be direct to buyers whether it’s online, or in person or through open houses.

2. Your online presence matters. You’ll need high quality copywriting, photography and other digital assets to attract attention as well as an agent with a large online presence with many outlets for property advertising.

3. Your agent should additionally be able to spread your property through their networking channels such as word of mouth, in-person and online networking groups, large offices and global presence! Your listing agent should be marketing not just to potential buyers, but also to agents.

A comprehensive marketing plan should focus around these items, agents who offers mailings, and magazine features are taking an antiquated approach to selling and in turn, losing you potential buyers.

Three reasons you should not wait to buy a home.

Home prices are expected to rise and there is no reason to believe that properties will become any more affordable in the near future. Here’s why:

1. Inflation. There is a direct correlation between inflation and home prices. When the money supply in the US increases, home prices also increase. We already know the fed has printed more money than ever before in the history of the US during the pandemic, and in fact, inflation was at 2.6% in April of 2020 and it has risen to 4.6% in April of 2021. Home prices will increase this year more than normal.

2. Interest rates. Due to inflation, interest rates will rise as well. If the value of money is decreasing due to inflation, lenders will require a higher return on their money to hedge the inflation. You will see an increase in mortgage interest rates. The difference between a 2.5% interest rate and a 3.5% interest rate can change your personal purchasing power as much as 10% since your loan amount qualification is based on your payment.
   
   Side bar: If you qualify for a 10,000 per month loan payment (this does not include taxes and insurance to simplify this example) based on your income and debts, at a 2.9% interest rate, that means you can qualify for a $2,400,000 loan amount. The same payment with an interest rate of 3.9% qualifies you for a $2,100,00 loan amount. How much more house can you get with an additional $300,000 of purchasing power?

3. There’s no bubble! Property values are based on supply and demand. Here are a few things that are deriving home prices increase.

   • Lack of new housing inventory. Due to rising costs of homebuilding, new housing starts are at the lowest they have been in decades. If new homes are not being built to meet demands for homes, then strained supplies become more strained.

   • Low interest rates. Low interest rates make high prices more affordable and more buyers enter the market place, increasing demand for homes.

   • High prices stifling moves. Home buyers who would normally be moving up to a larger home for their growing family or who would be downsizing to something more affordable, are unable to because home prices have increased so much. When homeowners don’t put their homes on the market, it further exacerbates a lack of inventory.

   • Banks restricting lending. Lending standards are also tighter than they have ever been before. Banks are not dolling out risky loans the way they were in 2008 and therefore the property owners that are leveraged are very qualified for the home they own.

If you’re looking to purchase property. Now is the time. For additional questions or information on the markets, contact me direct by phone or email. lauren@californianestates.com

The Worried Home Buyer: Why you should be buying a home even if prices are spiking.

The worried home buyer:

Why you should be buying while interest rates are low even if prices are spiking.

I see it time and time again. Interest rates drop, and suddenly a buying frenzy happens in the marketplace. Multiple offers on every property and accepted offers happening at 5 to 10% over asking price and 5 to 10% higher than the similar property sold 6 months ago. It’s scary. The sudden shift makes you worried that you’re overpaying for a property and you will end up in a negative equity situation.

There’s two main reasons why I tell my clients, IT’S OKAY TO BUY. And perhaps, it’s an even better time to buy while prices are spiking. More likely than not, YOU SHOULD BE PARTICIPATING IN THE BUYING FRENZY!

First reason and the main reason - from a purely cost analysis standpoint - your payment will likely be LESS if you buy during the spike. Let me show you how:

Let’s say in 2019, you decided to buy while the market was a little more fair. Meaning, you didn’t have to compete against multiple offers and you had more negotiating power with the seller. Let’s assume you locked in a low price of $1,500,000 with an interest rate of 3.94%. These terms generate a monthly principal and interest payment of $7,109.44 and you’re happy because you got a good price on the home.

Even if you have to pay a 10% premium because of the current market frenzy, if you’re paying less in interest, you have a lower, more comfortable monthly payment.

Now let’s assume, you, the same buyer, decided to buy the same house in 2020. However, this time, there is a huge demand for homes because interest rates have dropped. Because there is a huge demand, you are now competing against multiple offers and can only lock in the price on that house at 10% higher than the 2019 price. (Side note - this is actually an extreme increase given that in July of 2020 homes price nationally were only 5.5% (according to CNBC) over the average in July of 2019) In other words, the loan amount is now $1,650,000, but based on current rates in October of 2020 at 2.89%, your monthly principal and interest payment is only $6,858.96. Slow down.. what? Your payment is actually $250.48 LESS per month which is around $3,000 extra per year you are not spending on a mortgage!

What would you do with the additional $250 per month or $3,000 per year?

Here is my second reason. And this one is a humble reminder of why we buy homes rather than continue to rent. This is NOT an investment, unless you plan on selling again next year, stop stressing about the price. If you want to make money in real estate, buy INVESTMENTS. Buying for yourself? This is HOME OWNERSHIP! It’s the memories made, it’s creating it your own space for yourself with the security of never worrying about a lease ending. It’s stability to have a family in a place you love with the comfort that you’re not throwing rent out the door every month. 

Home buyers today are  being overly concerned to see if they are making a “smart investment”. Newsflash! If you’re buying this to create a home for your family in a place and community you love, it IS a smart investment! No one buys the house they live in based on the numbers - they buy it time and time again because it’s shelter, it’s love, it’s HOME. There is pure value in simply being a homeowner. Don’t forget that when buying a home.