It’s a crazy real estate market. There, I said it. How can you tell you ask? Allow me to elaborate. The first thing is that in many of the markets I work, there are fewer than 2 weeks inventory. This is especially acute in the sub $750,000 range. But even in the higher price points those number don’t go 
much above a month’s worth of inventory. That said, I am seeing more homes come on the market which is seasonally consistent with historical trends. It is the hot spring market after all. This is also the first week over week that inventory actually went up in 2021. Here in the Conejo Valley the number of available homes listed for sale went up 8% this week. But that means it went up by a whopping 14 homes across all price ranges. What’s this all mean you ask? It’s a seller’s market and it’s changing the way agents search property, sellers price property and buyers write offers on properties.
First, let’s start with agents. (Search homes here) In the past, I would set a parameter of price and area. This of course is unchanged. But then I would sort and start scrolling through in order of price. This is where I have changed. I now sort by days on market first and I start with zero days and stop at 3-5 or I may go out a week. There are a couple of reasons for this. First, this market is so hot that I want to get 
me emails out to my clients right away on anything new. Second, if it hasn’t sold in 5 days, there’s something wrong with it. Now I want to pause on this to let that sink in. Something wrong with it. OK, so I don’t really think there is anything wrong with it per se, but it’s likely mispriced for what it is. Funny thing about why a home doesn’t sell. If you find an objection with a home you just need to put the phrase “At that price” at the end of the objection. For example, the yard is too small… at that price. If it were $100K less would you say the same thing? Probably not. The condition is awful… at that price. I don’t like the location… at that price. See how that works? Now in this market, since it’s so hot, if a home has gotten an offer, there’s a reason and that reason goes away with “At that price.”
Regarding Sellers, the above is notable because when setting a price you have to ask, are you better off pricing it a little under and hope you get multiple buyers competing or a little higher to test the marketplace? If you choose the latter, that’s perfectly fine and in fact many times this is the exact course I recommend. Understanding this is one way where a great agent differentiates themselves from the masses. (Contact Tim here) But if you are a seller getting ready to price your home, you have to ask yourself this question: If I come in too high, how much am I going to have to reduce to get multiple parties interested enough to come and look or look a second time? If I were typing this on my phone I’d put the emoji with all the teeth showing because in California, at $10,000 or $20,000 price reduction don’t mean nuthin’! If you haven’t sold in 45 days, no one is racing to your door for a $10K cut, well that is if you’re over $500,000 asking anyways… Not only that, go back and reread how agents are sorting listings. Again, this is a crazy market, but a seller can still blow it.
As for buyers, you guys know how brutal it is out there. My buyer just lost out on an offer in the Rancho Park area of West Los Angeles. And yes, I do work the City incase you were asking… Anyway, the charming 1927 Spanish Bungalow was expanded to 1,700 square feet, had a Wolf range and the carriage house (garage – but only wide enough and long enough for a Model T or horse and buggy) which in this case was finished with high tongue and groove ceilings and HVAC, was listed for $1,595,000. We were one of 110 showings and 40 offers. We offered $1.7M, $105K over ask. The sellers actually only countered the top 9 of which 5 were all cash. The counter by the way, also 
demanded a 15 day close and no, repeat no contingencies. Not loan, appraisal or most importantly, as is – no investigation contingency. In other words, once your earnest money is in escrow, it’s subject to forfeiture. Nuts, right? So, what does that mean if you’re a buyer? The answer is if you see a home and really like it, don’t get hung up on the asking price. It is not the same thing as the selling price. Asking if designed to get multiple offers, will get multiple offers and the price will go higher. Therefore, you need to look at any home in the context of other similar, alternative homes you could buy at the same time and if there aren’t any, or you’ve lost out on some already, you have to step up and give it your best shot. My counsel to my Westside buyers was that I thought the home was going to go for $1.8 (it’s actually is in escrow for closer to $1.9 BTW) and that whatever their upper, upper limit was for that property – and it was an amazing never-move kind of property and location – go in with that. So buyers, do not assume you will get a counter if there are multiples in play. Sellers who receive a lot of offers, while excited, are exhausted too. They want the process over just as bad as all the buyers. This means they’ll pick the smallest number to counter they think they can to get the best price and terms. Sorry for the tough love but that’s how it is right now and for the foreseeable future.
Oh, what about appraisals you ask? Simply put, it’s a problem so you need to be prepared that you might have to come up with additional cash. I will say this about appraisal, first they are backwards looking so in every appreciating market since the dawn of time (Think caveman here: Baku: “Grog. I give you 5 brontosaurs femurs and a wooly mammoth tusk for your cave.” Grog: “What? Baku, you a crazy man. That last year price. Cave worth 2X that today! This a hot market!”) (See Tim’s latest cave listing here) Yesterday’s closed sales data doesn’t support today’s rapidly rising home values. 
But also, the appraisal isn’t telling you what the home is worth. Value according the National Association of Realtors is defined as follows: “A home is worth what a willing buyer and willing seller agree on without the presence of duress.” You offered, they agreed, that is now market value by definition. In fact, even though you’re paying for the appraisal, it’s not for your benefit at all. The appraisal is for the bank’s benefit so that when they go to sell the loan, they can substantiate the loan to value ratio with an accompanying appraisal. Don’t get hung up on what one appraiser says, especially when if it does come in low, you’ll want to say to the guy or gal appraiser, “Oh yeah? Find me one for that and I’ll buy it!”
If you like what you read here, please reach out and let me help you sell YOUR cave for top dollar.
you must be seeing a mass exodus of residents fleeing your over-taxed, over regulated and terribly expensive place, right?”
ability to think and create without the limits of preconception. That freedom blossoms here like no other place on earth. That’s why people want to live here and why they stay here. People from all over the world dream of life in California and our immigrant population is one of the many catalysts of our success. Back to your earlier question, are people are selling and leaving? There’s always people coming and going when you are a state as large as California. But have you noticed that when one leaves there’s someone right behind them to buy that home, plant roots, start a new company? California is where dreams come true. Our history is the American Dream. 
is certainly creating a host of new problems, especially with water. When you have lots of open space you get to go out and do things. When you have great job creation, people find work they enjoy doing and when you have tighter regulations, your water and air isn’t as poisoned as it is elsewhere. It used to be, but our determination to care for the planet and each other has changed that, though it’s always a work in progress. California is leading the country in solar and electric vehicles, emission control etc. Virtually every trend, be it environmental like conservation and preservation or physical like yoga, skateboarding or mountain biking, takes hold here first and that improves American life nationwide. 
kitchen and the “prep” kitchen. The former being the center island often with stools for casual dining or working on a laptop, that is open to the family room for all to see. Clean and open. The latter is described as a prep kitchen, but this doesn’t have to be a second full sized kitchen rather, a back area or sectioned off partial room. It can even part of an adjacent laundry. This back “layer” would have a disposal sink, maybe a second dishwasher and a small workspace for cutting and chopping. Your blender and food processor and maybe even coffee station can be part of this “second kitchen” as well. Again, this doesn’t have to be a huge space, rather one that is just large enough to get the prep work done, but small enough that it’s out of sight and can be closed off. It is not intended to take a ton of space from some other part of the house. Many of our Asian communities have adopted a similar idea for cooking with a wok. We find the “wok kitchen” listed as an exciting upgrade feature in many high-end homes in places like San Marino and Arcadia (
tools and spiders and smelling of gasoline, check out this Boulder Colorado company called Studio Shed. These guys are doing some amazing things. Like a number of companies out there, they are offering prefabricated ADU’s but they are also offering prefabricated sheds. These “sheds” start at 8’x10’ and can go as large as 10’x18’. You can get them with prewired electric, windows, doors including walls of glass and French doors. I mean, these things are cool! Some are even designed to be music studios, an amenity very dear and close to my heart. (
Since the All Clad is not only functional but beautiful, our kitchen took on an entirely new look and this, frankly, made cooking in the kitchen an inspirational experience. Lastly, now that winter is upon us, we finally bought a gas fireplace insert in a kit with blue colored glass. ($400 from our local fireplace store.) What a change! Instead of using real wood as we’ve been doing for years though sparingly due to the mess, I now have instant contemporary ambience in my family room! Not to mention a great way to warm the space on a cold winter day while I work from home. OK, it hasn’t been cold in Southern California so far this season, but the glass does look cool and I do rather enjoy working in front of the fire. And while these subtle improvements may seem like little things, often times little tweaks are all a home needs to become more functional, homier and perhaps just a little prettier. And after all, when it comes time to sell, I can assure you, pretty sells. (
sells 2200+ home a year, to have less than 10% as available inventory to start the year, it’s easy to predict prices are going to continue to rise in the Conejo Valley and I expect that to be true everywhere as well. By the way, if you are looking for a real estate tip and a market that is lagging, look no further than Las Vegas which according to Shiller rose the most modestly of any Metropolitan Statistical Area (MSA) in the country. Obviously gaming, travel and leisure are the driving forces of Las Vegas economics. Expect a disproportionate rebound there once the virus is under control and life returns to normal.
inflation. Right after the war itself and 1973-1983 right? Triggered by the oil embargo and Nixon’s de-coupling of the dollar from gold (the elimination of the Gold Standard) this period is really the only time inflation has ever really been “out of control.” Sure, there have been moments in time like the mid 1990’s, mid 2000’s where the economy ran hot but this was relatively short lived. These were times where the threat of inflation led the Fed to move rates slightly higher and that knocked inflation down right quick (
high. Heck, they are just starting household formation. They will be driving home buying for the next 15 years and to channel The Carpenters, they’ve only just begun (
I know it’s been a long time since I wrote you, like maybe 45 years ago? You’d know better than I… I’m writing you now because I have a few requests that I’m hoping you can deliver this Christmas. Oh and by the way, you’ll be pleased to know none of these require you come down a chimney. Although, I know with Covid you may be struggling and if that’s the case, I can always use a good chimney inspector. Think about it. Okay, so here goes:
buyer and then, just sign here… let me suggest a couple things you should consider. Let’s start with what he is actually saying: I have a buyer prospect and if you list with me, I’ll sell your home right away. First, if true, note the word prospect. A buyer is someone who’s put ink to paper. Until that time they are just a prospective buyer for your home. Many Realtors use this “close” as a way to secure your listing. Should you find yourself in this scenario, instead of signing a full listing agreement, try “That’s great. Let’s do a Single Party Listing and I’ll pay a full commission and you can represent both sides.” A single party listing is just that, a listing for one specific buyer.
response and after several somewhat heated discussions over the course of an evening with the other agent starting at $30K then dropping to $15K and then $7,500, the buyer finally asked for nothing. We see this a lot with things like roofs, sewer laterals and chimneys which are very expensive to repair and so the buyer will bring in “their” guy who of course makes money how? That’s right, by quoting a ton of work and getting some of it.
NAR’s data tells the story of a very hot seller’s market. There’s really no other way to interpret the kind of rise in actively listed homes currently under contract. Sellers are dictating price and terms and if you’re a buyer, you just have to bite your tongue, jump in the water and be prepared to paddle like mad. This is one crazy real estate market.
find a good home, you should buy it. If you are a potential seller however, you probably want to think about accelerating your schedule and sell now while we are still in a full blown seller’s market. “Strike while the iron’s hot,” it is said. I can’t see any real benefit in waiting.
The Real Estate Conversation 