5 Steps to Win a Bidding War in the Sacramento Area

There are five easy steps toward making your offer more desirable and winning a bidding war:

1. Write a letter to the seller. Almost everybody loves their home, so when you compliment the seller on things like the decor or the lighting fixtures, you build a rapport with them that resonates far more strongly than simply writing an offer.
2. Include proof of funds in your pre-approval. Show them that you have the cash for your down payment. This will establish your seriousness far better than a lender writing a pre-approval letter vouching for a loan.
3. Make sure your purchase offer is detailed and complete. It’s your agent’s job to verify that all of the information on the offer is filled out completely, including things like the listing agent’s name, office information, phone number, license number, and brokerage number. This proves to the agent representing the seller that you’re going to do the work that you’re responsible for, and that they won’t have to worry about it. 
4. Forget lowball offers! In this market full of multiple offers, a lowball offer might not even be addressed at all. I always advise my clients to write their offer at a price that they feel comfortable with. Decide what your sweet spot is and put your best foot forward.
5. Shorten the contingency period. An inspection contingency, for example, usually takes around 17 days, but it shouldn’t take that long. You can shorten it to 10 and show the seller that you’re serious and want to take the next step into the escrow process. 

If you have any questions or any other real estate needs you want brought to my attention, just give me a call or send me an email. I look forward to talking with you soon.

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Decide what your sweet spot is and put your best foot forward.

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Don’t Let Changing Interest Rates Weaken Your Purchasing Power

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 Thinking of buying a home? Search all homes for sale on the MLS

Our purchasing power is affected by rising interest rates. Right now, interest rates are at an all-time low, historically speaking. What that means is that you’re getting a lot more house for your dollar because money is cheap. Today I wanted to discuss the effects of changing interest rates on your purchasing power.

So what does this mean when—not if—interest rates start to go up again? These rates won’t stay low forever. Let’s look at how a rise in interest rates would impact your purchase price.

As an example, let’s say $1,500 is the amount you want to spend on your monthly mortgage payment, and 4% is the current interest rate. How much house can you buy with 10% down? This equates to a $350,000 purchase price.

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Now is the time to buy in case interest rates rise again.

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Now let’s say that six months down the road, interest rates tick up another 1%, but you don’t want to pay more than that $1,500 per month. Your purchase price would now be $311,100. This 1% rise in interest equates to nearly $40,000 less in purchasing power. A 2% rise would bring your purchase price down to $278,550, a 3% rise would bring you to $251,100, a 4% rise would leave you at $227,650, and so on.

This information is important to know as a buyer because you can easily see what a great position you’re in with the 3.5% interest rates in place today. This is also why if you’re a seller, you’re going to have some great exposure with access to such cheap money. Interest rates are low enough that buyers can now afford more house for less money per month.

If you’re thinking about buying a home sometime in the next six or 12 months, now is the time to buy, in case interest rates rise again and lose you over $40,000 off of your potential purchase price.

For more information, please feel free to reach out by phone or email. I’m happy to be a resource for you!

How Making Small Improvements Before Listing Can Net a Large Return

 Thinking of selling? Get a free home valuation

 Thinking of buying a home? Search all homes for sale on the MLS

A lot of my clients wonder what improvements they can make to their house to get top dollar in the best amount of time with the least amount hassle. I have a system and a process in place where I bring in a staging consultant and we create a punch list on how we can position the property without having our client - the seller - spend a lot of money on things that are not necessary.

Our goal is to position that house on the market so that it appeals to the buyers. The staging consultant on our team works really closely with us to determine simple things like doing interior paint or switching out light fixtures. It doesn’t have to be a full-blown kitchen remodel or countertop replacement. Just a few small updates can go a long way!

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Making small improvement before listing can yield a huge return.

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For example, I once came across a property that had sat on the market for 145 days under the direction of the agent before me. It was a smaller home listed at $189,000. I decided to get in contact with the seller after it came off the market, and they decided to put me to work. We then went through the property using our previously mentioned system and decided that only a few small things were needed: a one-room paint job and a professional staging of that room. Most buyers view your house online first so you want it to make a good first impression and stand out with staging and professional photography.

After that $1,700 investment, they were able to list the house for $11,000 more. Not only that, but the very first day it was back on the market, we got an offer above listing price and sold for $202,500. Just by doing these simple things, the seller invested a minimal amount of money and got a huge return.

If you have any questions or comments, please feel free to reach out by phone or email. I’m looking forward to continuing to be your resource and answer any questions that you may have.