Should you hire a real estate broker, even if the neighbor wants to buy your house? Is it really worth it to pay a real estate commission? Many times homes are sold off-market, to the neighbor, or a friend of a friend… sellers feel it makes good sense – save money on the commission!
Last week I sold a property in West Covina – a Trust sale. I made my recommendations and my team got to work, making minor repairs, replacing doorknobs and light fixtures, a thorough cleaning, yard cleanup and manicuring, and then staged it. My recommendation to my client was not to waste money on renovating the kitchen and bathrooms – staging would create a huge appeal that would draw attention away from the outdated tiled kitchen and bathrooms.
I got the property ready for market in one week, and waited my usual 10 day period to expose the property to the market. We got 19 offers, over asking price. One of the offers was from the neighbor across the street. We made a request for highest and best from all buyers, and the neighbor was in the top two, increasing the purchase price by $90K. I then picked up the phone and negotiated with the top two offers, and was able to bring up the neighbor by another $20K, and, the buyer agreed to remove all their contingencies. Property was listed at $849,900 and sold for $990,000! That’s $408/sf, while the highest sold comp is at $387/sf and is completely renovated with new bathrooms and kitchen. My client is thrilled. Presentation is critical. So is negotiations and that extra push and effort by your agent. Our services are available throughout California. Check out the property below:
Tag: Real Estate (Page 1 of 2)
All too often I see real estate agents making reference to “probate code”, while not providing specific citations, claiming that it waives legal requirements that they prefer not to adhere to. One example is the non-compliance of LA’s Municipal Code 96.300, requiring a seller to deliver the City of LA’s “9A Report” to a buyer either prior to entering into an agreement of sale, or, prior to the close of escrow.
A PPF recently reached out to me via my Probate and Trust Academy to inquire about a real estate agent’s Addendum to the C.A.R purchase agreement. It addressed the “Owner’s Declaration” section of the “9A Report”.
First, a quick background:
In the city of Los Angeles, section 96.300 of the LAMC (municipal code) indicates that the seller of residential property within the City of Los Angeles shall apply to the City for a report of Residential Property Records and Pending Special Assessment Liens (aka, the “9A Report”), and deliver such report to the buyer, either prior to entering into an agreement of sale or prior to the close of escrow. The application includes a section for the Owner’s Declaration, where the seller indicates the current status of devices and materials that must be addressed as a result of local laws (Los Angeles Municipal Codes). Under the “Owner’s Declaration” there’s a penalty of perjury statement, indicating “I, as owner, declare under penalty of perjury that the following statements are true and correct for the residential building for which this report is sought.”
The provision that was written by the real estate agent in the Addendum indicated:
“The owner’s declaration section which states that Seller is responsible to address Water Conservation, Security Lighting and Locks….Smoke and Carbon Monoxide Detectors… Was marked as Seller to complete prior the entering this escrow and only to facilitate obtaining this completed report to tender to prospective buyers. Seller is not obligated to do any retrofitting for any City, County or Municipality under the probate code, the responsibility to complete the above items AFTER CLOSE OF ESCROW, will be the complete and total responsibility of the Buyer, at Buyer’s expense. Seller’s representative has no knowledge as to the status of any of the required items as stated herein or in said city report and does not represent that any retrofitting has ever been done to the property, pursuant to LA City Municipal Code (or any other local municipality requiring such report)”
This agent’s addendum creates many problems for the agent’s fiduciary client, the PPF:
- There is no such probate code that relieves a seller of real property from complying with local laws. The seller (PPF) has a responsibility to obtain an understanding of the local laws and comply with them. Agreeing to their agent’s provision exhibits the PPF’s breach of fiduciary duty to their client.
- The seller, which is the agent’s fiduciary client, is signing under penalty of perjury, within the “Owner’s Declaration” section of the “9A Application” that the statements being made are true and correct, yet, the Addendum states otherwise. The Addendum states that the answers were marked as “seller to complete” only to facilitate obtaining the report. In essence, the seller is admitting to being guilty of perjury and is exhibiting criminal intent by making that statement – the statement that the seller is aware that the questions are not being answered correctly to the city of Los Angeles.
- The seller’s agent, in this case referred to as the “seller’s representative”, is making a statement that they have no knowledge as to the status of any of the required items referenced in the application, and, that by answering yes to some of the questions they do not represent that any retrofitting has ever been done, pursuant to LA Municipal Code. This is an excuse for the agent not to uphold their fiduciary duty to the client and advise the client that it’s prudent to hire a retrofitting vendor specializing in this, to inspect the property and advise on the work that’s required to be completed prior to the close of escrow, to comply with the law.
In this case, both the seller and seller’s representative have no interest in conducting due diligence to ensure the property adheres to local laws, and, both agree to disregard local laws, pointing to a non-existing probate code as an excuse for failing to comply with the law.
One of the devices referenced in the “9A Application” are carbon monoxide detectors, which are also required by state law. State Senate Bill 183, aka the “Carbon Monoxide Poising Prevention Act” requires that a carbon monoxide device be installed in all dwelling units intended for human occupancy. So, by making the statement that the seller and seller’s representative are not aware of the status of this device, is negligent, as this is a state law, and, the C.A.R. Probate Advisory form, which is part of the purchase contract, reminds the seller and seller’s representative that the sale is not exempt from this state requirement.
What can go wrong? The property sells, and, most escrow officers will let this close, and the family moves into the house. There are no CO detectors, and, the gas stove is emitting high levels of carbon dioxide, and, there are no detectors in the home to alert the occupants. Toxic levels of CO exposure prevents oxygen from reaching the brain and heart, and, unfortunately this leads to death. Now the seller and the seller’s agent have a big problem.
Does not matter where, let me help you with your next residential or commercial real estate transaction in California!
Probate Court Real Estate Sales A Proposal to Expand the Statutory Rules.
Real Estate Broker and Author Orit Gadish has identified that the current court confirmation process is prone to some confusion, unnecessary delays, and possible litigation and proposes a solution to mitigate this risk. Judge Glen M. Reiser has joined forces with Orit Gadish to fine-tune the proposal that will improve the way real estate court confirmation sales are conducted in the future.
I have a vendor that specializes in the complete remodeling of homes that I use again and again and again. He does a fantastic job.
I have never calculated how much business he has received from me this year, last year, or the year before.
I never calculated how much money he is making on projects.
I do not know his home address, nor do I know how large his home is, and if he has a 2nd home, or other investment properties.
I never think about limiting the amount of business I send his way, because he is too successful.
I only have two questions for him each time I want to help my clients with a renovation:
- Can you handle another renovation right now?
- Can you do it in this town or that city?
He almost always replies with:
- Sure, I can
- Sure, I can
And he gets the business.
If I am not your vendor yet, try me. You will see there is more than the four books I wrote and an ongoing contribution to the CEB.
If you tried me and realized I am good, will you let me handle your next listing, or will you calculate how much I am making and where I live, and then turn to a different agent that may end up delivering less optimal results?
I see agents boasting about selling a property in one, two, or three days. And some people think this is impressive.
After nearly 20 years in the business, I still do not understand what there is to boast about.
Is it not better to give the property the proper exposure and leave it active on the market for 10 days or so, and have at least two open houses (on consecutive weekends)?
Do we not want to give properties time on the market to expose them to as many buyers as possible?
Is it not better to create competition among buyers by waiting to have a multiple-offer situation?
If the property remains on the market long enough this can easily result in competition among buyers with a multiple-offer situation, which results in increasing the purchase price as high as possible, as it does in bidding wars.
This past week I had two closings – a Probate sale requiring a NOPA in Lancaster, and a Trust sale requiring a NOPA in Lomita.
The administrator of the Lancaster sale is located in Northern California, and requested “full service”. I had my vendor clear out the property, do a sales clean and carpet shampoo within a few days, and we got the property on the market.
The PPF, acting as trustee for the Lomita property requested the same level of service. My vendor completed a trashout, sales clean, and did some yard cleanup and landscaping to increase the curb appeal.
Both properties sold above market value. These properties were both outdated, and both sold to owner-occupants, at values equivalent to renovated properties in the immediate neighborhood. They were clean and they smelled pleasant, so the buyers could envision themselves making the renovations slowly, based on their vision and preferences.
Both of these buyers did not request any repairs, credit, or price reductions from the seller.
It was smooth sailing. The beneficiaries of both sales all consented to the NOPA. Everyone was happy.
Why didn’t the buyers speak up after the inspection, and use their strategy to request a repair, and then, agree to a price reduction in lieu of that repair?
That’s because before I had the sellers accept their offer, I requested to have a call with the buyer’s agent and the buyer, and I anchored that discussion. I told them both that I need to set the seller’s expectations at this stage, and ensure we’re all on the same page. If there are any requests for repairs, or credits, or price reductions, the seller will simply move on to the next buyer, and there are many other buyers interested in the property. Both buyers confirmed they understand, and from that moment on… they both performed beautifully!
This strategy is just one strategy I’ve developed over the years to ensure I deliver a seamless and easy sales process for my clients while obtaining the highest possible purchase prices for the properties I’m selling.
Some clients believe agents need to specialize in a localized geographic market, because they have their finger on “the pulse” of that market, or they “own that market”. Other clients believe agents specialize in a particular style of property, say mid-century modern, and only hire agents with that specialization when they have a property to sell. Don’t buy into this! It’s just a marketing gimmick an agent uses for personal branding.
As a real estate broker who has been doing this up and down California for almost two decades, first representing financial institutions, and later representing fiduciaries exclusively, I can tell you that the most important attributes of the agent you hire are their negotiations skills and their contract knowledge, and that, an agent obtains with lots of transactional experience. Doesn’t matter where they’re located, and whether they have their pulse on the local market. If the agent has transactional experience, the agent knows how to market real property, and how to evaluate any given market with the tools at hand.
Just some tips on what to consider next time you need to hire a real estate agent to sell your property. Ask the agent you’re considering how many properties they’ve sold in the past year, and, how many they’ve sold since they became licensed. That will tell you how experienced the agent is. You should also ask what the agent’s role is in the sale. Some agents are hands-off and are not as involved in the sales process – they have a team that handles every step of the process, and the listing agent is busy seeking the next listing. Sure, the transaction will close, but had your agent been more engaged and utilized strategies to act in your best interest, perhaps you would have avoided issuing a price reduction to a demanding buyer, and, perhaps you would have been able to obtain a higher purchase price if your agent was proactive and pushed the buyers to offer more, and more.
Food for thought.
We recently created our first virtually staged 3D Tour… on a Trust sale requiring court confirmation. The property is the former residence of the Laemmle family…Carl Laemmle Jr., the producer of Dracula and Frankenstein. Carl had this home custom-built for him back in the day, perched up on Tower Grove Drive in Beverly Hills, 90210.
The house was not staged at the seller’s request, but we did virtually stage every image of the 3D tour and put them together into a video… check out the video via the link below! It’s amazing what technology can do.
There are many real estate agents out there. So why work with me?
I will never tell you I am the top agent in this or that national brokerage. At best, I can tell you the truth. Nearly two decades ago, I founded and continue to run a boutique brokerage. We are focused on probate and trust real estate.
I will never tell you I have 10 different designations from this or another association of realtors. Anyone can get these designations. $150 dollars or so, and a few hours sitting in a classroom or on zoom and listening to someone that will tell you many stories from which you will not learn much.
I will not tell you, “let me take care of you” and then pass you to one of my assistants to do all the work and communicate with you.
I will never tell you “I am the best”. It is up to you to find that out for yourself.
I will tell you this:
I probably handled more real estate than any other agent you know. Why should you care? Experience matters.
I have sold real estate all over California. Please don’t tell me that you will send me the next asset that comes your way in Beverly Hills since I am an expert in this area. We both know the likelihood of that happening is very small, and I do have a family to feed just like you.
I probably have not seen it all, but that should not matter. Why? I have seen enough to know how to handle any situation no matter what comes my way.
I wrote the only book explaining the probate real estate process. I could tell you it is a great book, but I will not. Instead, I ask that you read the reviews on Amazon, ask me for a copy, and find out for yourself, or both.
I am a contributor to the CEB / Continuing Education of the Bar. As such, I educate attorneys. How many other agents do you know that do that?
I am sorry if you feel that I am talking too much about myself, but I have to share all of this with you, since selling probate and trust real estate is such a highly competitive environment.
And there is more. As an observant Jew that follows our ancient traditions, I can tell you that a core value is not to lie in business (and of course, in general). No matter who you are, if you share this value with me, then I look forward to the opportunity to work with you.
I know that I could make much more money if I swayed from the truth; if I did something illegal in business here and there. I do not, for example, give or accept kickbacks. If you are into that, please find another agent to work with. I would rather do less business during the day and sleep better at night.
And that is the truth.
I am grateful to be able to contribute annually to updating chapter 18 – SALES OF ESTATE PROPERTY of the California Decedent Estate Practice published by the CEB Continuing Education of the Bar – California / University of California (CEB.com).
