"Palos Verdes Resident since 1947"

May, 2013, Newsletter

Dear Neighbor: 

Onward and upward!  Reasonably-priced homes continue to sell quickly, often with multiple offers.  Interest rates still have not moved upward, remaining at around 4%.  And lenders have begun making 95% loans again (5% down) – I think this is called amnesia. 

One of the less-obvious issues we’re having these days is that of appraisals.  This is always a problem when the market is rising, as appraisers use closed sales (which, of course, are lower in a rising market) to determine value.  But, whereas lenders may have lost sight of the danger of making 95% loans, in the wake of the “melt-down” of a few years ago, appraisers are still under pressure not to over-value the properties.  What this means at the street level is that it is very difficult to get the appraiser to come in at the sale price when the property is better than any of the past sales and the price reflects that.  I actually had one tell me that he “could not appraise the property higher than the last sale, period”.  Now, I’m sure you and I could go on for hours about the illogic of this, but this is just one of the many irrational aspects of the appraisal process . . . with which I won’t bore you now.  I know – too late.  Call me if you’re interested. 

But don’t despair.  There is something you can do to minimize appraisal issues:  hire an agent to sell your house that actually does business in your area, in this case Palos Verdes.  Appraisers appreciate the help agents active in the area, who have seen the past sales (which the appraiser has not), can offer with respect to condition, floor plan, view, street nuance, etc.  Agents from Torrance, the Beach, or San Pedro rarely do enough (if any) business in Palos Verdes to regularly look at houses here, so when they need to know things about a past sale that only a look inside would reveal (which also comes in handy when negotiating the sale price with the buyer’s agent), they’re no better off than the appraisers.  The problem is that a past sale almost always looks better in the listing than it actually was, as the agent was trying to sell it when he wrote the listing – you think he’s going to point out the fact that you had to walk thru the 3rd bedroom to get to the 4th, or that the view shot in the listing was taken standing on top of the toilet in the guest bath? 

I’ve got a couple of new Valmonte listings coming up in mid-May – both 3 bedroom 2 bath, great locations, and in excellent condition, and priced just north of $1 million.  I have had several of my listings lately sell before they hit the market, so call me if you are interested.  I also have a lovely, move-in ready 2338 square foot 3 bedroom 2.5 bath townhome in RHE at only $750,000. 

By popular request, I am including the “Contact Information” sheet I sent a few months ago.  One never knows what the future holds, and in the event that your heirs must settle your estate, having this information all in one place will make at least this aspect of it a lot easier.  

As always, you can have a look at my website, www.DanaGraham.com, for the latest, or call me at 310 613-1076.

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