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Conquering the Los Angeles Real Estate Market: 5 Important Tips Every Homebuyer Should Know

Let's face it, it seems like pretty much every home on the market right now in LA is getting multiple offers. With a strong economy, good job growth, interest rates near-historical lows, and plenty of cash floating around there are simply more buyers looking for homes than there are sellers looking to sell. This can sound intimidating for buyers but it doesn't need to be. With a great agent by your side (hi!) you can conquer this market like a champ as long as you're properly prepared for what's ahead. 

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1. Bidding Wars Aren't Always About the Highest Price
It's important to remember every home-seller has different needs. There's no hard & fast rule for what a seller wants; cash isn't always king and the absolute highest offer doesn't always get the home. Maybe they're transferring out of state next week and looking for a buyer who can close quickly with no contingencies. Maybe they need a buyer who will wait for them to find a replacement home before closing or one who will lease the home back to them after closing. All of these bargaining chips are the terms of the offer and are just as important as the price.

The majority of home sellers will accept whatever has the best combination of both price and terms. This means in a situation with multiples that are all at or near the same price a seller will choose the one offering the terms that best suit their needs. Finding out what a seller is looking for and customizing your offer with those terms is our first line of defense to stand out in the crowd. You'd be surprised how many home sales I've represented where we've gotten dozens of offers but only a few buyer's agents bothered to call me to find out if my seller had any specific needs. I'll let you guess which offers usually move to the top of the stack.


2. Competing Against Cash Offers When You Have a Loan
About 1/4 of home sales in Southern California right now are cash. With that stat in mind we can assume if there are multiple offers on the table there's a good chance at least one is cash. If your offer is being funded with a loan it will inherently include more contingencies and a longer close than someone offering cash, which translates to a seller as more risk. It's a tough pill to swallow but with 2 similarly-priced offers side-by-side the seller is going to pick the one with the least risk.

If you're up against cash offers the most obvious way to compensate is by offering a higher purchase price - many sellers are happy to absorb a little more risk if it ultimately means more money in their pockets. It also helps to be as flexible as possible with things like your move-in date and requested repairs. Lastly we'll work closely with your trusted local lender to get your loan on the fast-track, tightening your loan and appraisal contingencies and even removing them entirely in some cases. Now we're cookin'!


3. Be Prepared
The Los Angeles market moves at lightening speeds - a character home in an up & coming area may get dozens of offers before the first open house and go off-market in less than a week. It can be overwhelming as a new buyer, but solidifying your finances ahead of time will put you at a huge advantage over the masses which aren't as prepared. It's fun to window shop, but there's nothing more heartbreaking than seeing someone fall head-over-heels in love with a home they've decided is "the one" and then miss the boat on putting in an offer because they didn't have their paperwork ready on the back-end.

Before you start browsing listings and visiting open houses you should have a pre-approval letter from a local lender and/or have your cash affairs in order, keeping funds needed for inspections, down payment, and closing costs in mind. If you still need to file taxes for this year or will be borrowing funds from a relative now is the time to explore doing so. Avoid online mortgage calculators - they're fun but they don't usually account for your credit score (which affects your interest rate), PMI, local property taxes, homeowners insurance, or a host of other things a real-life loan officer could better assist you with. 


4. Be Patient:
I know it's hard - you've got that pre-approval burning a hole in your pocket and rates feel like they're going up by the hour. Your friend who bought a home last year already has $100k in equity because values are rising so fast. This is so exciting! Do yourself a favor . . . breathe. Our market tends to come in waves - you may not see a home within your price-range in a certain neighborhood for many weeks, then suddenly 5 pop up on the same day. Keep your eyes on the prize, don't burn yourself out considering homes that aren't what you really want just because that's the only thing on the market today. Remember we're looking for Mr. Right, not Mr. Right Now.


5. Be Realistic:
Keep in mind many homes are purposely underpriced to attract multiple offers quickly - don't let yourself get hung-up chasing the dream of an unbelievably low asking price. Think of the LA real estate market like ebay and think of asking prices simply as starting bids. We'll discuss your budget and must-haves, pulling comps so you can see what similar homes are currently selling for and what kind of jump to expect in asking price vs selling price. You can trustingly shop with these comps in mind - if recent sales tell us to expect to pay a certain price for a home in a certain neighborhood with a certain level of finishes, that's what a home will end up selling for regardless of how low it's been initially priced.

My goal is to arm you with an understanding of the market so you can purchase a home with confidence. While other buyers are getting into an emotional frenzy over their offer on a home that was comically underpriced and subsequently sold $100,000 over their budget, you will be cool as a cucumber because you walked into the situation with realistic expectations. You came in armed with your paperwork and a basic understanding of the home's value, you tightened your terms wherever you could, and you offered accordingly. Pat yourself on the back, you are a soon-to-be home-owning badass!


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SOLD: 514 E. Chestnut St, Glendale

Congrats to my first-time canine homebuyer Winnie and her dog-mom Brooke on their awesome new Glendale home! Are you a cute unrepresented dog looking to buy a home to share with your dog-parent? Get in touch, I'd love to help!

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SOLD: 1501 N Mercury Dr, Highland Park

Big congrats to my awesome clients on their very first home! These Rental Girl renters turned TRG buyers fell in love with a beautiful modern home built in 2014 in a great pocket of Highland Park and knew immediately it was "the one". Now they'll be close to the action on Figueroa and York as well as everything in Eagle Rock and Pasadena. Can't wait to see what they do with all this wonderful space!

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SOLD: 2621 E. Glenoaks, Glendale

Huge congrats to my buyer on this incredible Glenoaks Canyon Spanish home! What a score - we looked for months, seeing every home in a 15 mile radius but none were checking all the boxes. This buyer wanted a character home with enough space to host guests, but not so much space as to be high-maintenance to furnish and maintain. He wanted a great pocket with tree-lined streets and a somewhat central location, something with hardwood floors throughout, and most importantly (and surprisingly most difficult to find) a home with a large private grassy backyard for his 2 very rambunctious dogs to play in. You'd be surprised how many homes in the $900,000 price-range have very little yard space, an abundance of concrete (not good for doggy hips), no fences, or no privacy. This yard issue was proving to be more challenging than we thought!

I reached out to some other local agents and found out this lovely character home, which seemed like it could be perfect on paper, was about to hit the market in 2 weeks. I was able to arrange a showing for us before it went on the market, my buyer immediately fell in love and we wrote an offer within the next hour, opening escrow the next day and closing in less than a month. Win-win for everyone involved - and just look at that yard!

I popped in last weekend to check in and see how things were going and we sat in his new magical backyard, listening to birds chirp and watching the pups play on the beautiful green turf he has since had installed. I'll have to go back and grab a photo to post in this blog as the yard is somehow even prettier now than it was before & definitely worth showing off.

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SOLD: 1054 N Garfield, Pasadena

Big congrats to my seller who received 4 offers for his gorgeous and well-kept Pasadena home, closing over asking price for $1,180,000!

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SOLD: 204 Joy St, Highland Park

Congrats to my sellers who received 14 offers within days of putting this incredible remodel on the market in hot hot Highland Park! This home was originally listed at $685,000 and sold for $85,000 over ask, closing in less than 30 days - look at all that character! 

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JUST LISTED: 204 Joy St in Highland Park

Step into this private Highland Park compound and you may never want to leave, but who says you have to? Inside this fully enclosed property sits an updated Spanish Bungalow inviting you to spread out and relax, entertain, cook, create, or just let the day lead you where it may. New white oak hardwood floors usher you through arched ceilings and doorways where modern upgrades meet vintage charm; 2 bedrooms, 2 full baths with custom red oak vanities, new chef's kitchen with quartz countertops, upgraded 200 amp electrical service, new central HVAC & Nest thermostat, custom leather and marble accents, new dual-pane windows and doors & more. 1,116 sq ft downstairs plus a bonus 125 sq ft loft upstairs leaves plenty of space for guests, a home office, or a kid’s playroom. French doors from the master suite lead to a private deck and xeriscaped backyard with sunset views of the Mt. Washington hillside, separate laundry and storage rooms, large 2-car garage with storage loft, and a pergola for evening dinners under the stars. What a Joy it is!

Asking $685,000. Open Tuesday October 11 from 11am - 2pm, Saturday October 15th from 1pm - 4pm, and Sunday October 16th from 1pm - 4pm or call me at 323-989-3839 for more information or a private showing.

Visit www.204Joy.com for additional photos, floorplan, and more.

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