Part Two of How Much Is My Home Worth

Obviously, if a nice home is priced at $1 it will sell in one second (the real estate agent will buy it on the spot) – and if a home is priced at $1 million it may NEVER sell. Any home will sell when it reaches the “market clearing price.” In real estate that means a reasonable price and sufficient exposure to a reasonable number of qualified buyers. Real estate professionals want to sell your home quickly, and, since they do not get paid until the transaction closes, a wise seller will listen to the pricing recommendation carefully. You may not accept the Realtor’s recommendation – after all you are the Boss and the Realtor is simply your agent – but the Realtor has more experience than you do.

If you have more experience than your Realtor, get another Realtor!

Recognize that you have an emotional attachment to your home that your real estate professional does not have. The potential buyers, or the real estate professionals who are assisting the potential buyers, do not have the years of emotional attachment that you have. That is why I recommend an outside source, an MAI-certified appraiser, to give all parties some unemotional perspective.

ADDITIONALLY, I strongly recommend that you ask your Realtor for a list of competing homes.

The appraised value is necessary to see that you are in the ball park when the home sells, because whatever you sell the home for, the final bank appraisal sets the amount the lender will lend on the home. You may successfully sell your home for $1 million, but if the lender will only loan 80% of what the Lender thinks the home is worth, and the Lender thinks your home is only worth $500,000, your deal will quickly fall apart.

But to SELL the home (and that is your FIRST job,) check out your competition. Try to be realistic. I know it is hard, but try not to say “Well, my home is worth more because it has a Yellow Bathroom.’

You need to act like a Buyer. Buyers do not know a darn thing about “comparables” – or the latest sales – they know what is currently on the market and they generally know how much they can afford.

Buyers know they have a bucket of money, and with that bucket they can buy houses A, B and C.

You want to price your home to finish FIRST in that sales competition.

Year to Year Sales

Data Quick has produced their March results, and of all of the “Escondido” areas, 92026 did less poorly.


Now I realize that is not a ringing endorsement of the market, but March 2008 to March, 2009, 92026 single detached homes declined “only” 21.3%, while South Escondido declined 40.1%, East Escondido declined 32.4% and West Escondido declined 46%.


And I realize that Hidden Meadows is not in Escondido, but for home price purposes we are included.


I again caution reading too much into the numbers. A legitimate number would include an appropriate number of low, middle and upper priced homes, and as you know only lower priced homes were selling during most of that year. Those lower priced homes are the most under pressure from short sales and foreclosures, so obviously they will sell for less.


It is only recently that middle priced homes began to sell, and therefore be included in the mix.

Part One of How Much is My Home Worth?

How Much is my Home Worth?

Evaluating the listing price of a home is one of the main jobs of a Realtor, and there are so many factors that it is as much an art as a science. Realtors, particularly those who regularly work Hidden Meadows, are very good at predicting the eventual sale price of a home, but valuation is NOT an exact science – and many sellers impose a higher price than their professional recommends.

I was designated as an Expert Witness on Real Estate Values by the Superior Court of the State of California in 1978, and I can attest that Hidden Meadows is as difficult to appraise as any place in the world. We have an entire community of custom homes, some new, some old; some luxurious, some rather plain; some on tiny lots and some on huge acreage; some with great views and some nestled in for privacy; some with pools, and some without…

Appraisers would like to make evaluations based on dollars per square foot. That concept has some validity in areas like Rancho Bernardo where one Acapulco model is very similar to all Acapulco models except for decoration. In Hidden Meadows, similar-sized homes may have vastly different construction, or views, or a pool, or marble floors, or … None of these things are accurately reflected in a “price per square foot” valuation.

(That said, I regularly publish the $/s.f. of homes listed, because it is a “quick and dirty” method of valuation, and easily understood.)

A home is actually worth what a buyer will pay for it (assuming the Lender agrees to loan that much), so the real arbiter of prices is the market, and that is best reflected by recent comparable sales. The vast differences between homes in the Meadows makes both “recent” and “comparable” suspect terms in doing an evaluation, but knowledge of the area and experience can smooth out those bumps. If you want an “outside” opinion – and I recommend that you have one, please open the phone book and call an MAI-certified appraiser. It will cost you $350-$375 for most average sized homes, but it will really help you determine an unemotional price.

MLS Update

It was a normal, which is to say an extra quiet weekend – and exactly NOTHING went on in the Meadows.

In the Zip Code for the past 48 hours, the numbers were small but very good – which is to say that Pendings and Closings exceeded New Listings.

There were three new listings, but seven Pendings and seven homes closed escrow.

(And, most importantly to my clients, we closed our home sale in Valley Center.)

A Closing Delayed — as Usual

I had a home scheduled to close on Friday, April 24.


 It did not close because of last-second paperwork but will likely close Monday.


You might think that banks would not be so busy these days, and might be able to get their loans funded in a timely manner…but my 32 years in this business have told me that lenders are the World’s Worst Money Managers. (I don’t think that needs to be explained further considering the recent events…)


If there is going to be a problem in closing a home in a timely manner, it is seldom a real estate agent, an appraiser, a title company, or an escrow company. It is invariably a problem with the Lender – and at the last second, what are you going to do? Getting a new Lender would take weeks and new paperwork, so there is nothing for a Buyer to do but grin and bear it.


Lenders know that also.


Do you think that MegaBank, Inc. gives a damn if you are angry? Do they care if your moving van is sitting in your driveway, motor and meter clicking away? Do they care that someone in Austin, Texas is sitting with a Mayflower Van in their driveway just waiting to move to the home you are vacating, or that there is a Bekins Van sitting in a driveway in New Orleans waiting to take a family to Austin, or…


Real estate agents regularly work nights and weekends, and I can actually get appraisers and Title Reps at home on weekends. Escrow companies are a bit more “corporate” but I have had them stay late, work early and on weekends.


Lenders? No way. It was them that the term “Bankers Hours” was coined, but I think the reason is that some of those who are willing to work nights and weekends are paid on commission and have an incentive to complete the job.


Others, like Title and Escrow may not be on commission, but are locally selected by those on commissions. If they are not immediately responsive, the agents will not use them next time.


But Lenders are usually the choice of the Buyer, as it should be. The problem is that the Buyer will not know that there is a problem until less than a week before the scheduled closing – at which time it is too late to change Lenders.


I have no idea why the sale did not close as scheduled on Friday. I only know that the Lender did not fund as scheduled and there was some kerfuffle between the Lender and some insurance paper that had not been transmitted.


This time we are fortunate: The Buyer is a renter. There are not five or ten homes in a sales line awaiting this closing but when there are the phone calls between sales in various cities becomes frantic.


Now we will see if this sale closes on Monday. I had warned my Seller for weeks that closings often are delayed so they were prepared.


It is just frustrating to have everything completed by agents, escrow, title – and get stopped so often at the last moment by lenders.







The Week in Review

There were 22 new listings in the Zip Code this past week, of which five were in the Meadows, and several of them were covered in my Thursday on-line Blog. (One covered with photos.)


There were “only” 13 homes that went into Pending in the Zip Code, and only one of them was in the Meadows. That one was on Laurel Path, and went into Pending at $490,000.


I say “only” because we have had a good run where the homes going into escrow equaled or even exceeded the new homes that came on the market. I hope that this week where new listings exceed Pendings is just an anomaly.


I suspect that is the case, and was made possible by an exceptionally large number of Meadows homes coming on the market in a single week.  Five new listings in a week in the meadows is exceptional.


There were 31 homes that closed escrow this past week in the Zip Code and that is TERRIFIC, but there is no way to use that number for analysis because they may have gone into Pending at anytime over the past 90 days, and just accumulated in one week. Still, that number is amazing.


Only two Meadows homes were in that closed number, and those closed at $532,000 and $549,000 – good numbers and well above the usual “investor sales.”

Today’s Caravan

img_1551One home, on Rocky Point was stricken from the Realtors Caravan today, but most of us know that house well. It is beautiful, on acreage (2.7 acres) and with a pool, but we will see it again soon.


In fact, all of the homes on the Caravan were nice – I hope that means we are nearly through with the abandoned foreclosures, or semi-maintained short sales.


The home on Indian Creek is beautifully done and well maintained – large (3,222 s.f), expandable, good views, acreage (1.14 acres), privacy…its only drawback is that it is down an amazingly badly designed driveway, but if one can overcome that it is one heck of a buy. When that home was being built, I talked the builder into lining the driveway with palms because although one could hardly drive off the edge, the driveway needed to be bordered to make people FEEL safe. It is the first few feet that are disconcerting because the driveway drops off rapidly and you cannot immediately see where you are going. If you can avoid the immediate visual shock – this is one terrific buy!.


(It is a genetic proclivity that I emphasize my opinions of the negative aspects of a home – because people generally exclude homes based on certain identifiable items. While not all aspects I note as drawbacks are NECESSARILY drawbacks for EVERYONE, they need to be noted so those who share my concern for drawbacks will not waste their time.)


The home on Meadow Glen Way West is the personal home of a local Realtor. It is immaculate, well appointed and maintained. Its drawbacks are that it is two story and has a small back yard.


The home on Rim Road was the only home in which Jean and I have never been. It has everything going for it: Single-story, beautiful golf course frontage and views; quiet, cul-de-sac upscale street; beautifully appointed, and decorated in Bed and Breakfast style. Drawback: Tile on the kitchen counters – a small drawback for this outstanding home. (Photos attached.)


All in all, a great Caravan.  Not a “dog” in the lot!