Are you thinking about selling your home? If you are planning on selling a home, you may want to use a professional realtor or a pro to sell your home. I’m going to give you five reasons why it may be best for you to hire a professional when selling your home. One of the biggest transactions you will make. So let’s get right into it. 

As you know, the market has taken a turn. As of 2021 and 2022, the market is totally different, not only in the local market, but also on the national market. The interest rates have jumped, and I mean really jumped double of what they were. House prices have pretty much peaked.They’re very high right now. Inflation is still very high, and the stocks are down anywhere from 10%-40%. So there’s a big slow down in what we call the financial markets. 

1.) So the reason, number one, that you may want to hire a pro when you sell a home is because they know the local trends.They are experts at what’s happening in the local market. And selling a home is about what’s happening locally. If the prices are going down nationally by 5%, your local market may go down 10%. There’s a prediction, for example, that in the West Coast, prices may go down as low as 20% from the peak time in the next year or so. But the same forecast in the Midwest and some of the states, it may only go down two or 3%. So what’s happening nationally may not affect you locally. And by hiring an expert, they know the local trends, what’s happening on the market, what has happened and what’s coming up that you may not be seeing right now. So that’s the reason, number one, that you may want to hire a local expert. They will really help you sell your home faster.

2.) The second reason why you may want to hire a pro is that they may help you set the right price. Now, if I’m a seller, I know my number one goal is to maximize my price. I want the most price I can get. Don’t blame you for it, because I would want the same thing. But what you want and what the buyer will pay you is two different things. In the hot market, when you listed a home, let’s say for a million dollars two years ago, it was selling for a million and $50,000. Or in other areas of the country, if your house was listed for $170,000, they were selling for $180,000 or $190,000. You were getting over bids on the price. But that market has changed. 

You can no longer expect to get the higher prices. You may even get a lower price. So setting the price right, so you can sell your home within 17 to 30 days is the best thing to do. And your local agent knows what’s happening in the market. They’ve probably seen a home similar to yours, a similar model, so they know what they’re selling for. If the comps are $800,000 and you want $900,000, they may tell you, hey, a similar home sold for $800,000 and you will not get $900,000. 

Of course, it’s one of your biggest transactions that you will do. So you want to maximize your price, but the price is what the buyer is going to pay you based on the comps. Just like sellers, when they talk to Realtors and get the comparatives in the market of what homes sold, buyers do the same thing. Not only that, the buyer have access to online evaluations. They can go to Redfin, they can go to Zillow, they can go to opendoor a lot of other websites, and they can check your price. And based on the average, they’re going to offer you that price based on your terms and conditions and the location. 

Just because you want a certain price doesn’t mean you’re going to get it. And also be aware that in a normal market, almost 30% to 40% of the homes don’t sell. Yes, 30% to 40% of homes don’t sell in a normal market, even in the hot, hot market,10%-20% of the homes did not sell. Why is one home getting 10 or 20 bids in two days and one home is sitting there? Well, usually it’s a one and number one reason. It’s way overpriced. 

If comps are a million dollars, and excuse me that I’m using a million dollar range, I’m in Orange County and the median home prices are a million dollars. I’m using that figure. If the comps are a million dollars, you cannot ask for a 1.3 or 1.2. That’s way out of range. Not only will the buyers not pay you for that price because they’re smart, they’re not dumb. They’re dishing out $100,000 to $200,000 down payment and they’re going to get a mortgage payment of $6,000-$7,000 a month. Last thing they’re going to do is pay you a high price. But the other issue is it will not appraise. And the other issue is, if it doesn’t appraise, they will not get a loan. So there’s a lot of reasons why you want to price it right, and your local pro will help you do that. 

3.) The third reason why you may want to hire a pro when selling your home, again, your biggest transaction of your life is because they have a large pool of buyers. Now, when it comes to Realtors, you may know as an individual seller some of the buyers in the area, and you may do an open house. But with Realtors, they have two kinds of exposure. One is they have their own buyer pool. They’ve been in the business. They talk to buyers and sellers everyday, every weekend, they do open houses. So they have a large pool of buyers. So they have a database of a lot of buyers. Not only their own database, but most of them work for a company. And these companies have a pool of buyers ready to go. But that’s one avenue. 

The other thing that the Realtors have is they have a database of the local top agents so they can advertise to them directly. It’s called target marketing. So not only do they advertise to the buyers and target market of buyers, they also target market to local Realtors and other Realtors, not counting all the social media websites and the websites that they have and all the other multiple listing services they belong to. 

So by hiring a pro, you are exposing your home to a lot of buyers through that agent, which you may not have personally. This is what they do. They talk to buyers and sellers everyday and they have a database. Real estate is all about the database. The bigger your database, the stronger the database, the better buyers and sellers you have from there. And most Realtors have a certain database of buyers. So that’s another big advantage of hiring a pro when it comes to selling your home in the time that you want to sell and at the maximum price possible at your time, at that time in your local market and with the least hassles.

4.) The fourth reason you may want to hire a Realtor or Pro is that they have the negotiating skills to close a transaction. You may not have that deal. The Realtors sell anywhere from 5-20 homes a year on average on a yearly basis. So they have sold a lot of homes over their career, especially the well experienced Realtors and who have been in the business 5-20 years. 

The number one skill that you want from your Realtor is a negotiating skill. When a buyer brings you an offer that’s $100,000 less than what you want, how are you going to negotiate that? Some of the buyers may want to ask you for your furniture, or when the repair comes up, they may want to ask you to repair everything. When the vendors and inspection companies do the inspection and recommend that you fix this or do this, they want to negotiate with you and with the potential buyer, what’s best for everybody. If a buyer comes and say, hey, I’ll buy your house, but I want to sell my house first, will you wait for me to sell my house so I can buy yours? How do you negotiate that? So negotiating skill is very important in closing a transaction, because transaction is a complicated process. 

Selling a home is one thing. It may take you 17 to 20 days to sell a home, maybe up to three months to sell a home in a normal market, that’s one thing. And then closing the escrow is another thing. That’s where all the negotiating comes up. And most of the problems start when you open escrow. You may have lending issues with the buyer, you may have appraisal issues. There may be a lien show up on a property, on your property that you did not know about. There may be child support issues that come up with you as a seller or with the buyer. And all this takes a lot of negotiating. There may be issues in the homeowners association that pop up. 

I remember I sold a house back in June, and the lady was very professional and she was very meticulous and highly analytical. She wrote the whole HOA process, 100 pages. And she found out that they were having problems. The HOA was having problems with the insurance companies and they had some lawsuits, so we had to go through that. Took us two or three weeks. We talked to the attorneys, finally resolved that issue. 

So any of these issues can come up before you close the escrow. So again, there’s a negotiating with the seller if we are representing you as a seller, but also with the buyer. So negotiating is a big skill. So if there is one reason you want to hire a pro is because they are better negotiators when it comes to buying and selling. And when it comes to buyer, seller, lenders, appraisal, all of them put together trying to close a deal on your house.

5.) The fifth reason why you want to hire a pro or a professional or a realtor is because there’s a lot of fine prints to deal with and there’s a lot of disclosures to deal with. 

I’m in California, and California has a lot of disclosures when it comes time to selling a home. There may be up to 20-30 forms by the time we finish closing a home. Not only that, but when the buyer brings an offer, a lot of buyers have addendums attached to it. So not only do we have to read the fine print of what they actually asking for, we have to be able to negotiate those based on what they are saying. And we cannot miss the little fine prints that they have. Not only on the offers, but on the addendum. 

And also we want to make sure that you as a seller, when you sell a home, you have filled out all the required documents, all the required disclosures, like Megan’s laws, earthquake laws, carbon monoxide laws, Los Angeles County has flushing your toilet disclosures. How much is the tank flushing? We have all kinds of disclosures. You as a seller, are you disclosing it to the buyers? Because that is required in California. It’s required in writing that you provide certain disclosures without which we cannot close an escrow. 

So selling a home, there’s a lot to it. There’s marketing, there’s negotiating, there’s photography, there’s staging. But there’s also a lot of disclosures. And your agent, your trusted and professional agent, will help you do that. Good luck on selling your home. Feel free to call me if I can refer you an agent or if I can personally help you.

 

New windows and new sliding doors brand new doors on the entryway including all the closet doors. As you can see the kitchen has been fully gutted as well. Or what I should say is fully remodeled as well. New cabinets, new appliances, new hoods, new tilings on the sidewalls, new sink faucets, they’ve done a great job all the electrical plates are new.

The reason is the home prices in Anaheim Hills are pretty expensive. The median home price is over a million dollars nationwide that’s around less than $800,000. In fact, California’s median home price is $800,000. This home adds a lot of value to the phenomenon of expensive housing. Yes, this is listed at $1.39M; a pretty high price. But as you can see, the seller has spent a lot of money gutting the whole place putting a lot of new things, painting windows, tiles, doors, appliances, recessed lighting, electrical plugs, you name it, and everything has been done so it’s priced pretty nicely. The average dollar per square foot home in Anaheim Hills right now is almost $554 a square foot. This is about 2800 square feet. So if you do the math is right around that price range. Of course, if it has a pool or a view or if it needs fixing, you can adjust the price this house is priced to sell let’s see more of this house. This combined living room and family room is very spacious right next to the kitchen spacious and fully remodeled downstairs bedroom and we just saw the downstairs bathroom. We are now coming upstairs and as you make a left you can see the balcony there and you will be greeted with an additional What do you call it an upstairs living room or a family room and the door there leads to the master bedroom which we will visit next.

A plastic sheet is there to protect the carpet. Just ignore that for now as we come to the door, we approach the upstairs master bedroom with a larger room, wall paneling, recessed lights TV brand new flooring this balcony is located outside of the master bedroom upstairs and the living room area I want to take a quick moment and ask you if you can comment or make a comment below and see where you feel the market is headed. There’s a lot of talk about the housing bubble the market crash or the market slowing down. Because the interest rate is up. Dow Jones was down 1000 points today. It’s been down for seven weeks or so. 

What not to fix when selling a house? Or if you’re preparing to sell your house? What do I fix? What do I not fix? What is my rate of return if I fix and spend money and time?

Selling a house is not easy. It’s overwhelming takes a lot of planning and preparation. So I’m going to give you some tips on what not to do when you want to sell your house.

Obviously there’s a whole bunch of things you can do to sell your home. But these are some of the things that are you’re not supposed to do when selling your home if you’re planning on selling your home in the next three months, or one year or two years.

So tip number one do not remodel your kitchen or your bathrooms so why do I say that so let’s say you want to sell your home and you want it to look nice so you say you know what, I’ll remodel the kitchen or the bathroom that looks good. It’s okay if you remodel the kitchen in the bathrooms but the first rule of thumb is if you do any remodel work, especially in these days, September 2021 it’s very expensive to remodel bathrooms and kitchens. So first rule of thumb is remodel to enjoy the kitchen and the bathroom don’t remodel to sell it because you don’t know what your rate of return is an average bathrooms or an average kitchen today at least in Orange County will cost you anywhere from 25 to $50,000. to remodel not counting the bathrooms if you have one bathroom or three bathrooms so it’s not a good idea to remodel just for the sake of selling it. But always remodel if you want to enjoy it. The other reason I say that is because let’s say your house has not been updated. You’ve been owning it for 10 years or 20 years and you don’t have any other updates your bathrooms or your carpets and your cabinets and your windows and drapes and your landscaping and then all of a sudden you remodel all the bathrooms or you remodel your kitchen and nothing else is updated. It doesn’t look right and you may not get the money that you put in so the rate of return may not be there and the rate rate of return I don’t just mean in cash but also your time and effort and the displeasure of not having a kitchen for a month or two month

Tip number two do not change your flooring just for the sake of selling your home. First of all do your flooring. Whether it’s carpet or tiles or wood flooring, do it for enjoyment if you’re going to be staying there for another year or so are you going to sell it after two years and remodel now so you can enjoy it and then sell it to get your money back. But as I mentioned earlier if if everything is not updated and all of a sudden you put brand new carpets or brand new flooring or brand new tiles whether it’s just downstairs or upstairs or just bathrooms or just the kitchen it may not tell because the buyers are smart today. They go online they compare homes these they compare prices, they compare the pictures with other homes that have sold in the area. So here you have a house that’s not kind of updated and you have brand new flooring and they don’t like the color because you like maybe gray and they like blue or purple flooring. I’m just saying that then it doesn’t really help so you have to be careful when you want to spend money on flooring. Like I said earlier flooring is also very expensive carpets are expensive and if you put a carpet maybe the buyers don’t like a carpet because a lot of people are allergic today a lot of the buyers have pets today they don’t want carpet so you may just want to keep your current flooring and just go with it. Now if your flooring is damaged let’s say in the kitchen there is some tiles are really cracked or the carpet has stains or it’s the odor is really strong in the carpet. In that situation. Of course you want to change the carpet maybe everywhere or just in the one bedroom just to make it look nice and seem presentable. So that’s a different thing.

Tip number three do not replace your roof unless it really damaged roofs are expensive. There are composition roof, these tile roofs and there’s metal roofs if you have a tile roof and if it’s damaged badly you may want to fix the area that are there are damage because today as I mentioned earlier September 2021 everything’s expensive composition roofs a few years back used to cost three to $5,000. Now they cost anywhere from eight to $10,000. tile roofs can cost you up up to $25,000. And metal roofs can go up to $40,000 depending on what kind of warranty they provide
putting  up to  40,000 into a roof you may not get the money back depending on what other features that you have in the house. What I may suggest is if there is a leak or if you want to tune up the roof, feel free to do that. But I will not recommend changing the whole roof just to get a better price because you’re going to put a lot of money and time and you may get that back. You may not get it back. So it’s something you want to really consider before you do that. I would highly recommend that you take recommendations or talk to few agents or talk to your accountant or talk For the professional to see what’s the best thing to do, should you change your roof or not should you need it but in general, most of the homes that I’ve sold the existing roof is good enough and of course if it’s not in a good condition if you think there is a leak possible then have it fixed and you can always buy a roof warranty when you do sell the house so you feel consciously nice that if something happens to the new buyers, you buying them a warranty so that the warranty will cover it for the buyers.

Tip number four, when it comes to not to fix things and that has to do with Windows a lot of the homes that I’ve sold a lot of the people try to replace the windows sell the home again the same thing applies if everything is not updated, then do not change your windows just to sell the home chain the windows because these most of them are damaged or there’s wind coming through. If there is fog in the windows. If they are dual pane windows, then maybe we’ll replace those but changing all the windows again in today’s market windows are expensive. Depending on how many bedrooms you have and how many windows you have an average homes have 10 to 20 windows that could cost you up top  $30,000 just for Windows and on top of that once you change the Windows you may have to change the wood blinds or drapes a double cost. So the rule of thumb again is change the windows if you’re going to enjoy the new windows if you’re going to stay there in your house for a year but you’re planning on selling it in the second or third year and go ahead and do it enjoy the windows. If not depending on if you have everything else upgraded or not, do not replace it. You could fix ones that are cracked or broken or as I mentioned earlier, if they’re followed in the dual pane windows, go ahead and do that. So that’s a tip that I would highly recommend.

Tip number five, don’t do partial upgrades when you want to sell your home What do I mean by their partial upgrade I’ll give an example of way back when I went to a friend’s house and he was so excited he said you know what I did some upgrades in my bathroom and he bought a house it was an older house and guess what he did in the bathroom everything was all the shower the tubs the sink but he went shopping and he loved this sink it was a fountain saying air coming out you know the taps were coming like there’s no tap there. They install that So what I’m saying is don’t put something really fancy if you’re not changing everything else because it does not look good. The other example I can give you is let’s say you have a kitchen and everything is not updated. You have the old cabinets you have the older appliances you have the old flooring and then all of a sudden you just change your appliances and put it put stainless steel appliances because you’re going to sell your house when doesn’t matter. It doesn’t go the buyers are gonna think Wait a minute, everything is old, the countertops are old cabinets are old, the flooring is old, the faucets are old, and here Here you have stainless steel so it doesn’t really match so if the buyer comes in and if your kitchen is not updated, you’re going to price your house accordingly hopefully to the market value but just because you put your stainless steel appliances in there like your range or your dishwasher and microwave you may not get the price that you spent four or 510 $1,000 with appliances, let the buyer do that. Let him come in and tear out the kitchen let him fix it or a lot of the buyers will just barely afford the home and most buyers stretch to buy homes, they may use those appliances and that kitchen as it is for one year, two year three years and change as they go along.

I wanted to talk about this topic because yesterday I talked to a young couple I had talked to about three years ago, and they were going to buy but then circumstances changed COVID hit or whatever the reason they decided not to buy, and here they are going to buy right now. And I nicely talked to them, the disadvantages of waiting, in general, to buy how much it would cost them by waiting any further. So here’s my discussion with them: I had the first thing I told them because you waited three years. And when I told them, it’s not about them in particular. But in general, if you’re a buyer by waiting three years, and if they were going to buy a house for $500,000.

Three years ago, as you know, the market has gone up 30%, let’s say in Orange County, maybe it’s even more, but let’s go for 30%. That means the house price they were gonna buy for $500,000 is now $650,000. So right off the bat by waiting for three years, they’re going to pay an additional $150,000. The second thing I told them about is their look, you rent it for three years. And if we take an example, they rent it for three years, at $2,500 a month, that’s 36 months. So they just paid $108,000, which is pretty much gone. In a sense, they pretty much lost their deposit. As soon as you pay the rent, it evaporates. And when you rent, and you pay $2500 A month or $3000 a month or $5000 a month, you lose that money. But guess what, the landlord gets richer. So the landlord is becoming rich by you paying the rent. If you’re paying $2500 a month. And when you buy a house, let’s say you pay $3000 a month in a sense, because of tax advantages, you may end up just paying $2600 or $2700 a month because of the tax refund you may get. But when you buy a house, you get a property tax deduction, you get interest rate deductions, you get homestead exemptions. Those tax advantages could save you $200 or $340 a month. 

So that’s an advantage that you’re not getting right now, when you’re renting at this point, the couple was getting frustrated. And I could understand so I was trying to be nice to them. But I carried on with my conversation on why they should buy now and not wait another three years. And the other reason I gave them the disadvantage of renting is that they are not building equity. Well, how do you build equity? So as I mentioned earlier, if you paying $3000 A month rent, it’s gone evaporated, but if you pay $3000 a month in mortgage, the $3000 includes principle and interest every month that you pay, let’s say the $2500 goes towards interest, you are saving $500 every month. And as time passes, the $25 interest will become $2500 of principal towards the end of the mortgage payment and your $500 would become your interest. So every month that you pay, you are paying down your loan and building equity in your house. One of the biggest ways or the fastest ways to get rich is by buying real estate and paying it down. The other advantage of buying a house is you get the appreciation you don’t have anything going on. But let’s say you did not buy the house for $500, which is now $650. So if you buy the house today for $650. And after 10-15 years, that my house may be what $800,000 And here’s a chart. And the chart shows that in general, house prices increased anywhere from two to 4%. Nationwide, every year. There may be a dip here and there may in the long term, you will see appreciation. So that’s a very good reason to buy a house if there’s one reason you should buy a house is to build your equity. That’s how you become rich. 

And here is the bonus tip, which is a nice bonus tip that I loved. I read about it way back when in the book called “The Instant Millionaire”. And that bonus tip is that once you buy a house or real property, you become frugal, and the way to riches is being frugal.

So what do I mean by becoming frugal when you buy a house? 

Well, when you buy a house, you are going to become good friends with Home Depot because now and then you’re going to go and fix a leak fix a window fixer door as you’re doing that you’re building equity in your house, you’re going to go to Home Depot and other fix-up shops and buy little things and fix up your house. So you’re keeping track of your housekeeping. So as the time goes up, you’re gaining 2% -3% per year so you’re building again equity and appreciation, and one way to do it is becoming frugal by cutting back on your Starbucks, cutting back on your movies, and cutting back on other things. I remember when I bought the house I was pretty much broke when something broke. I had to wait for five or six months because I couldn’t afford it so I stopped cutting other things movies outings driving around for nothing wasting gas but that made me frugal now I’m a homeowner for 25 years and I’ve got a lot of equity in there hope this helps please wait for the next video it has tips on how to save money or how to save a down payment for your next house.

What is seller financing? Seller financing is the same as owner financing. In this video, I’m going to talk about what seller financing is when one would use seller financing, and what the advantage of using seller financing is. So how does seller financing work? Well, in traditional lending, the bank actually gives money to the buyer to get the loan, whereas in seller financing, the seller extends credit to the buyer to buy his house with a certain amount of a down payment and certain terms and conditions. 

The best way to explain seller financing is by giving you an example. So let’s assume there is a seller who wants to sell his house for a million dollars. The house is a little bit overpriced, but the seller will not go below that price. That’s what he wants. And let’s assume that he found a buyer and that the buyer is willing to pay the higher price for the house, even though he could find something similar in the 950 range or the 925 range. But let’s assume the buyer is willing to pay a million dollars, which is typically the case when the buyer cannot get a loan from a traditional bank. The second option is seller financing. And when the seller does the financing, the buyer usually pays more for the house or may pay more for the interest rate. So in this example, let’s assume the buyer cannot get a loan from the bank. So the seller is financing it, and he’s willing to pay a million dollars for the house, assuming he puts 10% to 30% down. So in this example, if the house is worth $1 million and let’s say the buyer is putting 20% down, that means the balance is $800,000. The seller will carry a note for the buyer, and then the title goes to the buyer. Or it could be kept in the seller’s name. It’s a negotiable item. And then the buyer pays the seller the monthly amount. Usually, in this kind of scenario on seller financing, there is not a 30-year note, although the payments will be done on a 30-year amortized or 20-year amortized mortgage. Usually, these loans, which the seller carries notes for or seller finances, are refinanced in three to five to seven years, depending on how you negotiate. 

But a seller does not want to carry the note for 30 years or 20 years. You have to put a stipulation in the note or in the terms and conditions that the buyer will refinance in three to five years, which is pretty typical. I just did a note or seller carry financing a few months back on a commercial property where the seller wanted a higher price. It was one million dollars. The property was worth about 950 to 1 million dollars. But the buyer was willing to pay $1.2 because he could see the development potential in the future. So he was willing to pay more. But because of the higher price and because he did not appraise, the buyer could not get a loan from the bank. So the seller ended up carrying the note for five years. And there was a stipulation in there that within three to five years the buyer will refinance and pay off the balance of the note. So that’s another example. So the question is, why would the buyer go with seller financing?

Well, there are a lot of reasons. One of the typical reasons is that he cannot get a traditional loan from the lender or the bank. An example would be, let’s say there’s a buyer who has medical issues and a lot of bills, which shows up on his debt ratio, and he cannot get a house, but he really wants to buy a house. And maybe he finds a seller who knows the buyer, finds out who the buyer is, and understands the situation—that he had student debt, he had filed for bankruptcy, he had medical bills, or whatever the reason—and maybe he sells the business at a loss. So whatever the reason, he has a lot of cash flow but poor credit. So the banks would not give him a loan. So in this case, the seller understands the buyer’s situation. So he will usually charge him more for the property. He will charge him more on the interest rates, and the buyer understands that, hey, the buyer is not going to get a loan from a traditional bank or lender. So he’s willing to pay a higher price on the purchase price of the property and a higher price on the interest rate. At least he’s buying a house because he or she wants to buy the house. So there are a lot of other scenarios. But basically, seller financing is here to stay. When the prices go up and the interest rate goes up, inflation is high, as it is right now in November 2022. It is very typical that seller financing will be coming back. I just did seller financing on a commercial property six months ago, and I have an escrow right now as we speak on another commercial property where the buyer could not get the loan because he did not appraise. The buyer really wants to buy the commercial property, and the seller has agreed to do seller financing because he’s getting a higher price and will charge the buyer 8%.