"Palos Verdes Resident since 1947"

July 2021 Newsletter

Dear Neighbor:

To the amazement of many, me included, the real estate market continues to be red hot.  Demand exceeds supply, although it’s not clear to me that supply is any longer as constricted as it was during Covid.  Many people are deciding to sell now while the market is hot and prices are high, and retire to an area where the cost of living is lower.  As I’ve said before, I’ve seen markets similar to this in my 36 years in the business, and one thing they have in common is that they end just when everyone assumes this is the “new normal”; but they don’t end with a bang – they just sort of fizzle out and you don’t realize it until it’s in the rearview mirror.  I can tell you from much personal experience that what follows is no fun – chasing the market down.  So if you’re thinking of selling, call me now.

As you know if you read these letters, I am big on the fundamentals of the business; I am less big on the slick, flashy (and irrelevant) image projected by some.  In the current market, multiple offers and back-up offers are common.  It seems that every new, reasonably priced listing is getting multiple offers, which is great if you’re the seller.  From the agent’s point of view, it’s a pressure situation if the agent wants to obtain the best offer for you, the seller.  All 10, densely packed pages of each offer (and I’ve had as many as 11 on a single property lately) have got to be carefully analyzed for terms and conditions that may affect you, the seller.  It may be that the offer with the highest price is not the best one – if the buyer has a house to sell, has a small down payment, sketchy financing, or other terms unfavorable to the seller, those have got to be factored in when analyzing the offers.  In a hot market we often have problems with the appraisal coming in low since the recent rise in prices may not be reflected in the past sales – and we will have a plan for that too. 

It can all be a bit overwhelming for newer/inexperienced agents, of which there are many when the market is hot, and mistakes can be made; so you want an experienced agent on your side who has been thru this many times.  One of the things I do to make it easier for my sellers is to prepare a spreadsheet that breaks all the offers down into their essential terms so that, if you’re not used to dealing with this, the comparisons are relatively easy to make.  An effective strategy is to make a counter offer to each viable offer, soliciting their “best and final” offer.  You are then in the strong position of being able to pick from the best ones.  Upon request, I will also have a recommendation as to which offer, if it were my house, I would accept.

You can see that the agent you use can have a significant effect on the sale, not only in terms of price, but also whether or not it closes escrow as agreed.  Once an offer is accepted, your agent must pay close attention to the escrow to make sure the terms are being adhered to and alert you to any potential issues on the horizon so that a plan is in place to deal with them should they arise.  They don’t teach this stuff in real estate school – it is only learned thru years of experience and many hundreds of successfully closed escrows, in my case over 36 years.  One easy way to tell how long an agent has been in the business is via their Dept of Real Estate license number.  The holder of any license that begins with 02 is pretty new.  For reference, mine is 00877973.  Visit my website at www.DanaGraham.com.

Thanks for your continued support, and I look forward to speaking with you.                                                                                                                                                                                             

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