Zombie Office Timebomb: Commercial real estate foreclosures jumped 117%

 

Tempo Matters When Selling Your Home


Introduction: Importance of Tempo in Home Selling

 Tempo matters when you sell your home. We'll talk about that and the zombie office time bomb in the commercial.  Rina and what else list price reductions, which I haven't really even looked at, and today's highs and lows. Let's get moving. I'm going to make this so that you can actually see it. All right.

Understanding Market Dynamics and Pricing

Tempo matters when you're selling your home. It actually, it's a huge thing. I don't know how many times in the last 20 years, people have come to me and said, Vito, this is the price I need. And I won't sell unless I get this price.  Your price doesn't matter because you as a seller don't determine the final sales price.

It's important to understand that buyers will only pay for what they deem your house is worth period. it's not a dig on you. It's not a dig on your house. Buyers understand the market. They're educated. They take the time to understand the market and they look at your house compared to other houses that have sold around in that area.

And if they can't justify why your house is. Worth what you're asking, let alone a little bit more then you're set to be pissed off at your agent and in for a lot of disappointment. Now I did a little bit of chunking here. today, January 1 to July 30th, which is today, 2024 Santa Clara County, single-family home sales.
If you look at it, I gave you a little bit of a visualization. I talked about this yesterday. I wanted to update these numbers. And how many have closed in the last seven months, the percentage of that total, which is erroneous.

And then the list prices, and sales price ratio, which I went through. And that's why I'm doing this a little bit later than normal because it took me a little bit of time to get these numbers for you. 

Off-Market Listings: Pros and Cons

What you're going to see is off-market. Now, if you ever asked me about off market it's really coming soon.

They put it on the market and I don't think it's the smartest thing to do because what you're doing is you're not exposing your house to the entire market. You're keeping it hush. And maybe you don't want people tromping through your house, but is that really the best benefit for you as a home seller?
To me, it's not unless you absolutely tell me, Vito, I don't want a lot of people going through my house. I want to make this an exclusive sale. I can tell you with a great deal of certainty that you're not getting the value you can out of exposing it to the market.

Now, when you expose it to the market, you put it on the MLS, you do all the advertising, and you send it out on all the social channels. And you have open houses, you let buyers come through at different times when they can do it. And you expose it to the entire market. Now, let's say that there are a thousand buyers who are looking for homes at this particular time.

 There's only a certain set of those people that are looking for your price range, your bedroom count with or without a pool, that kind of thing. So it narrows it down to maybe five or 10%. So really you're looking at maybe 50 to a hundred people looking at your house. when the times are great, you can pretty much slap up any price you want.

Home Inspection CHECKLIST HERE

But at the same time, when the times are a little bit less crazy and firestormy, you have to be a little more careful about setting the price. Now, the seller sets the price the listing agent helps determine that price and you make a better determination of it, the buyers will come in and make a good decision.

A best guess on, whether is it worth what they're asking? And if so, do I like it enough? And within 15 seconds, five seconds, really, they're going to tell you, yes, I like this house or no, I don't like this house, whether it's the neighborhood, the curb appeal, the staging, what have you, right? 

Effective Home Presentation Strategies

So everything comes into play when it comes to selling your house.

You want to have a nice neighborhood. You want to have a nice curb appeal. You want to have the house staged. With a purpose, whether it's a bedroom or a living room or a dining room or an office, you want it clean and everything. And you want to present it as well as, as much as possible.

Now, when you list the house too high, you're saying my house is better than everyone else's house out here because I remodeled my kitchen back in the nineties and replaced it. 90 percent of the windows in my house because I ran out of money or I don't have air conditioning or my pool needs to be completely refurbished, but I'm going to ask for a premium price.

While you're going to be sorely mistaken and pissed off at your agent. When your house doesn't sell. Now look at these numbers, right? A big, huge number of homes sell within the first 14 days. I like to get My listings under contract within seven days, but typically when the market slows down, I let that slide because I want to expose it to a greater portion of the market.

After 14 days, all the buyers in that. The group has seen your house, whether they've seen it on the MLS, they've gone through the house on an open house or they've had a private showing and they decided whether or not they want to buy that house, 17 and change. So just rounded up to 18 percent of the houses are overpriced And I can tell you that specifically, because if you look at the list price, the sales price ratio, which is very important when you price it correctly, the house is going to sell, right? The house will sell now off the market.

Yeah, that's an erroneous number because you don't really know if that market. I think off-market sales are a bad deal for sellers. I say that all the time. I'm not a big fan of it. I think it's just a greedy way for the listing agent to double their listing so they can double up their commission.

And I don't think it's worth anything to the seller. I don't think it's a good value. It's a great option for buyers and buyers agents if they can come in and it's great. Option for that office. So if I have say five offices, I work for one of the big franchises. I have five or 10 offices. I can spread it around and I keep it inside.

I'm doing my best for my company. Am I doing the best for my seller? Do I have a fiduciary duty to maximize the profit of my seller? I do. So when you look at this. Understand that tempo matters when you control the tempo, meaning you have the house listed below what you think it's going to sell for. You're attracting the market.

You get a lot of offers and you control the tempo. You control the variables, the price, the terms, the contingencies, the close. How long they can move in or how long until they have to move out Now, these numbers don't look hugely dramatic, but they are when you look from 96 to 112, that's a huge number, especially when you're talking about 2 million on average for a home to sell, right? Understand that tempo matters. It's a huge deal guys. And if you have more questions about it, if you think I'm full of crap or whatever, please do comment down below because I want to talk about this.

I want to get this out in the air. And my job is to protect my client, the consumer, right? And educating you with these videos. That's how I do that. 

Zombie Office Time Bomb: Commercial Real Estate Crisis
Now, zombie office. Remember we're talking about the house of cards. The house of cards.

 We have the House of Cards right here. And any one of these things could be coming. And I think it's either going to be the automotive market or the commercial market right now. 
I slowed down in 2018, but now we're at a point where I think we're grossly overvalued for a lot of things for food, for gas, for rent, for commercial, for everything, right? Zombie office time bomb. How many people are working out of their house? How many people are working out of their office?

Those offices are now becoming zombies or they're dead space, right? They're not being utilized correctly. So some business owners are electing to get rid of some of their space. We'll go to a temporary space or go to a hybrid system, right? But that's hurting the commercial business. And I'm telling you this from many different angles, from apartments to commercial space, to strip malls, to everything, Look at all these office buildings where their parking lots are completely empty.  somebody owns that and somebody has to pay rent. Somebody has to pay the loan on it. Somebody has to pay the utilities on it.

Somebody has to pay all that stuff on it. And a lot of these are going to go underwater and then foreclosure. And I've been talking about that for the last two weeks. The commercial is one of the tipping points of the House of Cards. Be very aware of what's going on. What can you do about it? Pull back some cash, get ready to buy some commercial property, and let's go.

But be very careful about it because when the market crashes, all the investors come out. So just be aware of that. And what you're going to present, because you don't want to sell a house as is with a hundred different things that you have to  fix up decide if you're going to look at the big things and decide if you're going to put effort and repair into some of the big items on that checklist, 

It'll get you a headstart for when you have a Property inspector come through and look at your house But of course, if you do fix it, disclose it. 

Price Reductions and Market Signals
Price reductions in Santa Clara County. let's see This one right here, Meridian Ave, list price decrease. Remember guys, when you decrease the price, you're trying to attract the market. And when you're on a busy street, which this house looks like it's in beautiful shape, we'll go into that in a minute, but if you're on the market 20 days, and all of a sudden you go down a hundred thousand dollars, that's a huge signal to buyers saying, Hey, I overpriced my house.

Maybe I should look at lowering the price. Maybe I should have listened to my agent and lowered the price and attracted the market in the beginning. 20 days on the market is far too much. They're going to have to expect to see 103 instead of the 112.

Vito, if you told me to list it 5 percent under,   there you go. We list 5 percent under where we think it's going to sell. And sometimes you're pleasantly surprised. Again, I'm not promising you what the sales price is going to be. I promise you that your house will get sold quickly. If you listen to what I tell you.
Four bedrooms, three baths. No, I'm sorry, two and a half baths, 2, 651 square feet. This is not my listing. So 6, 240 Meridian Ave. Again, it's a busy street in Almaden and I think it was overpriced. They should have had it priced at two or 2. 1. It would have been sold already and the seller would have been gleefully happy with the sales price and leave it at that.

Tuesday's Highs and Lows
Tuesday's highs and lows. June 30th, we have 164 closes, which is a lot lower than it has been over the last couple of months. The highest sole price is 11 million. The lowest sale price is 825, 000, which isn't that bad. It's sold for 114 over the list price. This one right here, Was a market maker.

They lost six 4 percent on it, four and a half percent. And these two we talked about last week. They're still on sale, Waverly and Loma Prieta. And then these two activities, we have 1000 homes for sale right now. We need to have about 2000 to make it a balanced market, but the market's kind of contracting right now.

Price reductions. We have 198, which is almost 20%. That's telling you that the market is slowing down.   So pricing your house is super important. 

Conclusion and Final Thoughts

That's all I'm going to tell you. Thanks for watching. I'm Vito with Abitano. We'll see you out there.


Vito Scarnecchia Real Estate Broker, Veteran, Dad DRE#: 01407676 408-705-6817 Vito@abitano.com Website: abitano.com https://www.onereal.com/vito-scarnecchia-1 update your home value: https://hmbt.co/bT7qRJ RELOCATION@ABITANO.COM FREE DESKTOP APPRAISAL https://www.propertyrate.com/agent/vitoscarnecchia If you are moving ANYWHERE in the world - Let me know! I know a LOT of AMAZING Agents! Book appointments here: https://calendly.com/abitano/15min Home Buyers Course YT YouTube.com/SanJoseLiving IG https://www.instagram.com/abitanogroup/ FB https://www.facebook.com/vito.scarnecchia/ LI https://www.linkedin.com/in/vito-scarnecchia/ Blog http://blog.abitano.com/ POD https://spotifyanchor-web.app.link/e/oxdH1Hwfcvb Professional Photography by Kim E https://photosbykime.com / Local Real Estate Market and Home Value Report https://hmbt.co/bT7qRJ Financial Intelligence https://docs.google.com/forms/d/e/1FAIpQLSc0R5pjHIAPguZ5GDEB-fTbGJXKpWK3coK9Khymv_GTWkMnyQ/viewform?usp=send_form https://www.onereal.com/vito-scarnecchia-1 Willow Glen's five most expensive homes https://youtu.be/3A_E2ck0ePg

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