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Adapting to Adverse Times is the Key To Success!!

When Selling a Home, there are no secret methods or crystal balls. Pricing is Essential. I'll research and provide you with the following: Current Homes on the Market, Sold Homes in the Area, Pending Sale in the Area and Homes that didn’t sell in your Price Range. The use of Materials, Amenities, Features, Sq Ft., Beds, Baths, Cars, Condition and Upgrades are also part of the Pricing Evaluation. No good Agent will bait you with Pricing that’s too High to get your Listing. Of course, you are the Only Person to set a Price for your Home.

Net Proceeds (how much cash will you put in your pocket), is a central factor of Selling. If it’s the only reason for pricing, achieving a sale is more difficult or impossible. Buyers are not ignorant. They have seen homes in your price range and know when pricing is too high.

Home prices in 2022 softened slightly for a short time, in '23 they are slowly rising again, this is due to a shortage of inventory, and we are still a Sellers’ Market (more buyers than sellers). Buyers are adapting to the higher rate of borrowing and getting less home for the price. This means multiple offers in a competitive price range, is likely. It’s not because you are selling low. It’s because you are priced right!

Time on Market in Orange County, for homes less than $3M is about 25 - 45 days. If your homes worth is around $1M up to $2M and it takes longer than 30 days, the simple truth is, it's overpriced. Homes worth $3M - $10M may take 60 - 150 days. Homes worth $10M and up may take 6 months to a year.

When Buying, give a serious look into a 7-year fixed rate mortgage. What are the risks? How do things look for you over the next five years? Most homeowners sell or refinance within 5-10 years. Be sure you understand the “Prepayment Penalty”. If there is one: How long does it last? How much does it Cost? Does it occur from a Refinance and or a Sale? I have the opinion that rates will come down, but not soon, 3-5 years. When they do you can reduce your rate, extend the term and have more equity/value. More Home for the Price and a Lessor Cost of Borrowing is the Optimal Situation.

 

Buyer Beware - Seller Beware litigation is on the rise due to the condition of homes after escrow. It's been a common strategy for Buyers to Waive "Home Inspections". This means a "request to repair" or a discount in price has been waived. When a Buyer moves in and discovers worn out infrastructure or the structure itself is failing the cost to bring these deficiencies up to standard is expensive and litigation ensues. My business practices can reduce or eliminate the possibility of a lawsuit.

 

As for the Economy, here’s what I see:

  • We ALL have to adjust to these challenging times, it will probably last a while.
  • Minimum wage has increased.
  • Supply chain with China has reduced.
  • Developing Infrastructure for goods produced in the U.S. is expensive.
  • Trillions of dollars were released to Businesses and Individuals in the U.S., due to Covid.
  • Jerome Powell (Fed Chair) Increased the Cost of Borrowing to slow spending and combat inflation. This method has more than a singular affect. It increases the cost of doing business which means businesses have to raise prices and it affects the U.S. Treasury Bond. The debate over a Current Recession continues. Having said this, there are signs of Strength. A lot of companies have exceeded quarterly profit goals and employment is stable.
  • In the Stock Market, the term “Over Valued” is becoming more frequently used, especially in Tech Stocks.
  • Tech companies have realized where payroll is over budget and induced layoffs: Google, Microsoft, Amazon, etc.
  • Streaming Channels have tightened thier budget for content and reduced the amount of shows in their catalog.
  • Banks have failed to due to Liquidity. The law requires Banks to have a certain percentage of Cash to offset their Investments. Thier Bond Investments declined which lowered the Banks value and raised the minimum of cash needed.
  • It’s important to understand the Link between U.S. Treasury Bonds and Interest Rates. When Rates go Up, Bonds go Down and Vice Versa.

My Number One Goal in Serving Clients is to “Listen”. What are Your Goals and Circumstances? What tools and resources do you have to reach your goal and match your circumstances? This is my Key Philosophy to Serving You, as an Agent!

Although the transaction process is standardized and regulated, every transaction is Unique. When I listen, I come to understand your situation. Since I’m not emotionally tied to the transaction, I can give positive and negative Insight. If I see something that doesn’t match your needs or is to risky, I will protect you with all the legal means I possess.

Service – Insight – Diligent – Execution - Protection

Your Agent Jeff Monroe!!