Buyer’s Resources
5 Reasons I Should Buy Into Santa Barbara Real Estate Today!!
Categories: Buyer's Resources, First-time Home Buyers, Santa Barbara
Many true buyers are sitting on the sidelines these days deciding on when to get into the real estate market. Ultimately this decision for each individual will be based on many different factors. If your own personal reasons are leading to you wanting to get into the Santa Barbara Real Estate market right now, here are 5 factors today that should be a part of your thoughts.
1) You can not time the bottom of the market. Timing the bottom of the market is incredibly hard to do and often harder to resist. With current inventory at a decent amount and mortgage rates very low, find a perfect place with your Realtor and then try and bargain. Even if the selling price seems to be very good, offer lower…if it is not accepted you can move on.
2) Low mortgage rates. Most economists agree that financing will become more expensive in the future. By now we have all heard our share of stories about financing woes even for well qualified people. Currently, the 30 year loan is now roughly at 6.1% and most economists see it reaching 6.5% by the end of the year and up to a 7% forecast sometime in 2009. So even if home prices do fall some more, there will most likely be a penalty to pay with higher interest rates.
3) Rates on “larger conforming mortgages”, which is almost a given for most buyers in the Santa Barbara area, won’t be dropping much. Even though the conforming amount has risen to $729,000 in the Santa Barbara area, investors are shunning these big jumbo loans. Because of this, these larger loans are unlikely to see a drop in rates in the coming year and then the program for these “jumbo conforming” loan amounts are set to all disappear.
4) Don’t just by for a cheap price, buy in a good area. Sure you might get excited about that great foreclosure price, but when you are buying a home, you are also buying the neighborhood. If more than a few foreclosures have come up in one area, there most likely will be more. They tend to be bunched in particular areas and this might not be the best recipe for stability in a neighborhood. An old rule of thumb is to buy the worst house on the best block…not the worst house on a bad block.
5) Work with a great Realtor that has experience and who you personally have a good connection with. This I think just needs to be accepted since times are tough for many Realtors. Make sure your Realtor is not desperate and just steering you into a home to finally make a deal. Sit down with your agent, express your needs and plans and get a good sense of whether they are looking out for you or just looking to get paid.
Further Reading: The Positives of FHA Loans here in Santa Barbara, Goleta and Carpinteria areas, The 2 Major First Steps in Buying a Home in the Santa Barbara area
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to contact me or comment below with any thoughts.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
| Discussion: No Comments »
Are Short Sales a Good Path to Santa Barbara Real Estate Ownership?
Categories: Buyer's Resources, Carpinteria, Goleta, Seller's Resources, Short Sales
At the beginning of 2008, I wrote a few articles about short sales and foreclosures in our local areas here in Santa Barbara, Goleta and Carpinteria. At that point, we had only seen a handful of foreclosures in our areas and most of these were in the entry level condo market from the $300,000 to $650,000 price point as well as track homes from the $590,000 to $800,000 price point. Short sales were also just starting to creep up in our local areas within the same market and price points.
Now in the last several weeks, we have started to see a definite increase in short sales with many sellers looking at short sales as a great opportunity to attempt to sell their home and many buyers looking at short sales as a great opportunity to get into the market here in the Santa Barbara area.
Here is the Catch: Not all short sales are actually going to be sold…in fact most won’t from what we are seeing. Ruth Simon and James Hagerty have written a very informative article in the Wall Street Journal talking about this fact.
I myself have now represented both buyers and sellers with short sales here in that last few months and here is what I can recommend:
1) You have to be patient. Start to finish can take 3-4 months or more and offer many headaches.
2) Look at what the seller currently owes on the property. If they currently owe a lot more than the asking price (for example $650,000 and they are trying to sell if for $550,000 and you write an offer for $500,000), most likely the investor that buys up the loan from the lender will not accept your offer.
3) There is a definite difference if the seller has only a 1st or a 1st and a 2nd on the property or has refinanced the property or owns the property as a second home / investment.
4) If you are currently an active buyer, continue to look at properties for sale and don’t just count on the one property that you have an offer in on if it is a short sale. You don’t want to pass up 6-10 weeks of properties coming on the market to then learn that your offer is not going to be accepted.
If you have any questions…I would be happy to talk and share what I know.
View: Current Inventory of Short Sales in Santa Barbara
Further Reading: Any Great Short Sale Opportunites in Santa Barbara and Goleta CA?
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to contact me or comment below with any thoughts.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
| Discussion: 2 Comments »
The Positives of FHA Loans Here in the Santa Barbara, Goleta and Carpinteria Areas
Categories: Buyer's Resources, First-time Home Buyers
Here is a great list of positives about an FHA mortgage that I picked up from First Capital that I felt buyers should know about…
- Common sense underwriting
- Maximum loan amount $729,750
- No declining market appraisal issues. Lenders are not reducing the loan to value if a home is in a “declining market” whereas all traditional loan programs are being cut by 5% loan to value
- Buyer can put as little as 3% down of which all may be gifted
- Seller may contribute 6% credit to buyer - 3% for closing cost and 3 % for down payment
- Buyer may not need money out of pocket with some assistance programs
- An employer / parent may co-sign and qualify for the loan as a non-owner occupant co-borrower
- Flaws in credit history are allowable
- Debt to income ratio of 31% / 43% or higher
- Interest rates are generally at or below market - full documentation required for most loans
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to contact me or comment below with any thoughts.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
| Discussion: 1 Comment »
Search the Santa Barbara, Montecito and Goleta CA MLS for Free
Categories: Buyer's Resources, Goleta, Montecito, Santa Barbara, Seller's Resources
Searching the Santa Barbara, Montecito and Goleta area MLS is now easy and free. 
More and more buyers and sellers are wanting to start there search for real estate on the Internet, in the own comfort and privacy of their homes. If you are looking for the MLS here in Santa Barbara, Montecito, Goleta CA and surrounding areas, you have found the right place.
SantaBarbaraRealEstateVoice provides you with all the tools you need to start your information gathering about real estate in our area for free, with no obligations or sign-ups. You can search via any of the single criteria below as well as any combination of criteria:
- price
- cities as well as neighborhoods
- style of housing (condo / single family etc.)
- beds and baths
- schools
- zip codes
If you see any homes of interest, you can request information about the particular listing(s). After searching on your own, if you would like to then be personally set up to receive listings as soon as they are listed in the MLS that meet only your specific needs, contact me as well or sign up.
Further Reading: Search the Santa Barbara MLS and More
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to contact me or comment below with any thoughts.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
| Discussion: No Comments »
Any Great Short Sale Opportunities in Santa Barbara and Goleta CA?
Categories: Buyer's Resources, Real Estate News, Short Sales
Over the last 4-6 months we have started to see an increase in the amount of short sales and foreclosures here in the Santa Barbara area…especially in the Goleta and Carpinteria areas. Almost all of these have predominantly fallen into the price point from $250,000 to $800,000.
Question - Is a short sale a great opportunity to buy a home for cheaper than market value?
Answer - It can be if you have the time, patience and the wherewithal to deal with a lot of potential frustration, uncertainty and waiting?
What is a short sale? - A short sale is simply an unfortunate situation where the current owner of the property owes more on the loan than what the going market value for the property is or can be sold for. For a buyer, this can be an opportunity to purchase a home at a definite discount. But it is not as easy as it seems on the surface.
Steps taken for a short sale:
1) The owner has to first contact the lender to let them know that they have learned (via comps and/or their Realtor) that the market value for their property is less than what they owe on the property. The seller then lets the lender know that they can no longer make the payments on the home and thus need to sell the home as a short sale. Lenders are obviously not excited to hear this and will do all they can to encourage the owner to keep making the payments if possible. Only once the owner finally says that they will not be able to continue to make the payments and need to sell, is it then determined that the home will now be a short sale.
2) The owner now has to market the property for sale, but herein lies the Catch-22 and the start of the waiting and headaches. At what price do you market the property for sale and at what price do you “accept” an offer since no one knows the exact price the lender will accept. To officially go into escrow, the lender has to approve of the purchase and the terms of the contract. If you then call the lender to talk about this, they will give you absolutely no guidance. Here is where the headaches start to manifest….the cart before the horse.
The lender will only respond to you about pricing, terms and the sale of the property once you have:
- an explanation letter and proof of the hardship of the situation of the owner
- an “accepted” purchase contract
- proof of the buyer’s ability to purchase the home
- copy of escrow instructions
- estimated closing costs
- previous tax return slips from the seller
- employment paychecks from the seller
- copy of a TDS
- past bank statements and potentially several other documents from the seller
And here is where the headaches continue. Once you have all this documentation you have to fax it into the lender. There is still no point person for the entire transaction. Just fax it in to the number given and hope all goes well. The waiting now builds. After about 1 week you will most likely get a call from someone at the bank who lets you know that they have received all the correct documents that they need and a negotiator has been assigned to your case. Say thank you if this happens. If they don’t have all the correct documentation, one missing signature etc., you then have to obviously get this to them and then again wait for several days for a response. Finally they have everything and the real wait begins.
Over the last 6-10 months, the amount of short sales and foreclosures has increased so drastically for the lenders that it can take 5-9 weeks to get an accepted offer. Usually the listing agent will be called within 2 weeks after submitting all documentation to simply be notified that the case is progressing and a negotiator will call you “soon”. Finally after around 3-5 weeks they will send out an appraiser to do an official appraisal. This then will take another 1-2 weeks at least. Once the lender then determines that the appraisal is OK and the price and terms that the seller has “accepted” is OK, the lender still has to get approval from the investors who will be buying the loan. The investors ultimately determine whether the price and terms are acceptable and whether you now officially go into escrow. If they do not accept the terms then they will counter the buyer and you go from there.
Note* - During this entire 5-9 week period of waiting, any other offer(s) can be submitted at anytime and the bank will look at these. The potential buyers have no idea of whether their offer is acceptable or not, or whether one buyer has written only $1,000 higher than the other. The banks then have no obligation to accept either offer, or to counter one offer vs. the other.
If you do get your offer accepted after a general 5-9 weeks of waiting, then you have roughly a normal 30-45 days escrow to close on the property. And…the property is sold as is. Hopefully now you will not discover during a home inspection any repairs that are needed that are not acceptable to you based on your offer. Additionally, the buyer will have to stay in contact with their lender during this time to make sure that the loan they were “getting” is still a go. Most lenders can only lock a rate for 30-45 days and so your loan situation might change during this entire waiting period.
So…yes, if all does go well and you can deal with the waiting and potential headaches, you most likely will get an accepted offer at somewhat below market value.
View: Current Inventory of Short Sales in Santa Barbara CA
Further Reading: Are Short Sales a Good Path to Santa Barbara Real Estate Ownership?
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to comment below with any thoughts and/or call with any questions.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
| Discussion: 1 Comment »
Search The Santa Barbara Area MLS…and More!!
Categories: Buyer's Resources, Real Estate News, Santa Barbara, Seller's Resources
Question- What has been the biggest change in Real Estate in the last few years (outside of the sub-prime fallout)?
Answer - The amount of real estate information that buyers and sellers can gather on their own by going online.
A few years ago, the standard features for a Realtor were to simply have a static website with contact info, some pictures of a few properties, offerings of a CMA and some links to various “resources”. Buyers had to start the early process of their search by contacting a Realtor and asking a bunch of questions…Today, buyers and sellers want to be equipped with more tools for themselves so that they can be more informed when they do contact a Realtor.
Santa Barbara Real Estate Voice is an online resource to provide you with the following tools to gather information about real estate in Santa Barbara CA, Montecito CA and the surrounding areas:
1) Search the Santa Barbara Area MLS
2) You can sign up to receive Santa Barbara Area Listings with detailed information, pictures, maps etc. The listings will be sent to your personal email address and will meet only your specific needs and criteria
3) You can sign up for RSS feeds which provide you with updated information and articles that are written about the Santa Barbara area with such topics as market statistics, market updates, neighborhood info, schools, events, things to do etc.
4) You can read about market statistics, market updates, neighborhood information and schools
5) You can read about buyer’s and seller’s resources
6) You can read about dining, shopping, community events, things to do
7) You can read about architecture, green living and more
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to comment below with any thoughts.
| Discussion: 1 Comment »
Plan for your Santa Barbara Remodel Now, so that you don’t go Crazy Later
Categories: Buyer's Resources, First-time Home Buyers, Seller's Resources
Many of us have heard our share of drama stories and even read articles about the drama involved with many Santa Barbara home remodels. Whether it is a simple kitchen make-over or a complete addition to your Santa Barbara home, here is a quick planning strategy to hopefully save you wasted time, energy and money.
-
Start with a wish list, even if this will have to be dwindled down in the future. This is surely one of the most fun activities in the entire remodelling process, so have a great time and get creative. Keep all of your notes, drawings and cut-outs from magazines in a folder.
-
Rather than just guess at a budget, consult with a financial planner or a CPA about your plans. See where you are at financially based on your situation today as well as your future plans and determine your ceiling with regards to costs…stick to this!
-
Pull a street file or city file on the property to help in determining what you can or can not do. Also, ask your Realtor how much they know about your neighborhood and if they have their own personal tips and knowledge. Just looking at precedent in the neighborhood (such as a second story) does not always guarantee that you can do the same. The permitting process and building codes here in Santa Barbara can and do change.
-
Hire your architect of choice and ask for some preliminary sketches of your plans. From the start, make sure that these plans are aligned with your budget. Check to see that your architect hopefully has some experience with drawings in your neighborhood.
-
Interview several contractors that you know of or whom have been referred to you. Most of your money and time will be spent with the contractor so make sure that your vision and personalities align with each other. Hiring your contractor will be the single most important decision in the entire remodelling process. Finally, have your contractor lay out a schedule of drawings, permitting, time-frame for completion of various phases of construction and ultimately costs. It is important to know that the lowest bidder at the beginning is not necessarily the best choice for you. Quality work, adhering to a time-frame and personality will go a long way towards the ultimate satisfaction of your completed Santa Barbara remodel.
Kevin Schmidtchen - Thank you for reading. I hope you find Santa Barbara Real Estate Voice informative. Please feel free to comment below with any thoughts.
Subscribe to Receive Personal Listings of Santa Barbara Area Properties
Search the Santa Barbara Area MLS
Further Reading: 2 Major First Steps in Buying a Home in Santa Barbara, 5 Crucial Tips to have your Santa Barbara Home Ready for Sale
| Discussion: No Comments »
