What does it cost to buy
a lot or land in Los Gatos?

(Updated Entry as of 3/27 the original links seemed to expire soon, so I'm using another method to bring you this information)

Have you ever wondered what it might cost to buy a parcel of land, maybe a view lot, and build your own home?

Any idea what it costs to purchase raw land in the Town of Los Gatos? Are you curious?

Right now, there are 23 parcels for sale in Los Gatos. I've assembled the list for you to view on another site of mine. If you're curious, have a look. You may not be surprised at the most expensive prices, but you may be surprised at the least expensive ones!

The links above go to this URL:

http://www.popehandy.com/organizer/psr_list.cfm?k=I0&i=KCNL51LV43VML111

If you're prompted for an email and password, use my email, Mary (at) PopeHandy.com and the PW is Land.

Are there many short sale listings
in the Los Gatos, Monte Sereno, Saratoga area?

In some parts of Santa Clara County, a high percentage of homes on the market in the lower price ranges especially are offered as "short sale" listings. For example, recently I've been assisting buyers of single family homes in the $500,000 price range in parts of San Jose (such as Evergreen, Blossom Valley, Santa Teresa and South San Jose). The vast majority of those listings, perhaps 95% or more, are "short sales".

But that's not happening in Los Gatos, Monte Sereno or Saratoga. Short sales pull values down, so if you live in this lovely foothill area, be glad that the real estate market here is healthier!

Here are the numbers of local short sale listings as of today, March 26, 2008:

Mini Market Update:
The Los Gatos Real Estate Market

Want to Buy a Home in Los Gatos?
Some Tips to Get Your Home Purchase Offer Accepted!

We read about the real estate market being a buyers market, and some folks think that means that houses, condos and townhomes will always sell for much less than the asking price.

That just isn't the case. There's a whole lot of "it depends" going on. Take each property on its own merits, do some homework and strategize how to get the best deal when buying a home.

Some sellers, for example, deliberately underprice their homes to attract multiple offers. This, of course, pushes the price up and the sellers are often very pleased with the results. (It is usually far more effective than "testing the market" with a high price.) So if it's underpriced, don't assume it'll sell for less.

How should you evaluate Los Gatos real estate when you're thinking of writing an offer? I go through this with my clients all the time, so let me give you a few tips here.

First, make sure you understand the current market conditions for the area and price point you're interested in. I put out a monthly Real Estate Report (about the 10th of each month) that will help you understand the city or region - such as Los Gatos/Monte Sereno, Saratoga, or districts of San Jose like Cambrian Park.  But there are lots of micro climates in real estate, even within a town or a zip code! So before writing up a purchase agreement, look at comps and ask your agent to help you understand what's happening locally. You'll want to know both the list price to sales price ratio and also what homes are generally selling for in that particular neighborhood. Once you know those two things, you adjust for things like improvements, condition, precise location, and other issues.

• In the Town of Los Gatos, homes are selling at an average of 97.7% of list price. How will sellers feel about offers that are at 90% of list price or worse? You're right if you guessed that they'd be insulted and upset.
• Upset sellers don't tend to be cheerful in negotiating; trying to get a "killer deal" may prevent you from getting the house at all! 
• When a lowball offer comes in, most often, sellers give a high counter offer. (What constitutes a lowball offer varies, but 10% below list is usually taken badly by the seller.)

Second, learn as much as you can, before writing an offer, about the home's condition. Find out if there are disclosures, inspections and reports online. If so, read them first to get a true picture of the property's condition. If it's in great shape, it will be worth more, and if there are a lot of repairs, it will be worth less. No resale (or used) home is perfect, so do not expect a 45 year old home to be flawless. (I often see this mistake: buyers will view homes at the top of their price range and when they find flaws in the home, start subtracting based on their budget rather than based on market value.) Do consider how it compares to others like it on the market, that are pending sales or recently sold in terms of condition.  The best agents do all this upfront, or at least as much as possible. If you happen to be viewing a home that is a short sale, it is highly unlikely that the seller will have any inspections...because there just isn't any money with which to do them.

Third, ask upfront, through your agent, what the seller wants or needs to be happy. It could be price, it could be terms. (Terms are the other important aspects of the offer such as required repairs, length of escrow, things included or not included.) You may or may not be able to give it to the seller, but knowledge is power and often the price may be lower if the terms are more favorable. If the seller needs a quick close, you may be able to buy the home for less if you can move fast. Same with "as is" or other clauses that make the seller's life easier. Seniors often have a difficult time clearing out their property, so if you, as a buyer, offer to take on the seller's old cans of paint or other "headache" items, you may create a sense of ease and goodwill that may result in a better price for you. I have seen this happen many times!

With this third point, I should stress that some agents will not want to take the extra step and pick up the phone to talk with the listing agent. There are some agents out there who never call, but simply fax over an offer. To the better, more professional agents, this is really annoying and smaks of laziness and non-professionalism. Listing agents want to know when an offer is coming in. They may tell your agent important information that enables you to write a cleaner offer (that perhaps will not need a counter offer if it's right the first time.) Please make sure that your agent will phone ahead, do a basic inquiry and make a good impression of you to the listing agent and seller. Transactions are about people as well as business and this is an important aspect you should not ignore.

In today's market, which varies wildly from one zip code and price point to the next here in Silicon Valley, goodwill still goes a long way. So let me add a few closing tips:

• If you happen to meet the seller, try to be friendly and respectful - sometimes if the seller simply likes you, it can go really far in making the transaction together (remember, buying and selling is emotional and not just a business deal!).
• Make sure you hire an agent who will also try to put a best foot forward for you. If there are multiple offers  (which does still happen!), it may come down to whom the listing agent feels best about working with. Reputation matters, and so does the agent's professionalism.
• If it is multiple offers, and there are disclosures online, read them, sign them, and turn them in with your offer if at all possible. The seller and listing agent will know you are not going to be surprised later and back out. Even if it's not multiple offers, the seller will feel more confident if he or she knows you have read the inspections and truly understand what you are trying to purchase.
• Most Realtors in Los Gatos will be looking for a 3% initial deposit and a pre-approval letter from a reputable source (not an online entity). In some parts of Santa Clara Valley, smaller deposits are the norm. In Los Gatos, 3% is strongly preferred and at the least will be expected when contingencies are removed.
• Write a letter. Make nice. Tell the seller why you like their house.
• Is the house really overpriced? If so, have your agent politely explain the reason behind your offer price.
• Is the house not overpriced, but not selling and you can only afford so much? That kind of honesty can work too. Just tell it like it is. Talk to your Realtor, but something like "Mr. and Mrs. Seller, I realize that your home is worth XYX amount, but unfortunately I don't qualify for that much. I would like to buy your home, but the most I can afford is XY amount. In turn, we'll take it as-is and do a three week close, and give you a one week free rent back, and we sincerely hope you will consider our offer...."

Stories float around Los Gatos, Monte Sereno, and Saratoga of transactions that never came together because the buyer insulted the seller. About 10 years ago, I had a listing and an offer got faxed in (no phone call) and it was just an awful, lowball offer. The purchase agreement was 10% below list price and had a ton of bad terms in them. My seller ripped the offer into quarters and took the house off the market.  And there was one story I heard, a few years back, of a buyer who asked the seller to leave the family's dog too. The seller was angry and would not sell the home at any price!

The average and median prices are helpful to understand what's happening overall. Any home, though, may be different from the average or median, and the sellers may have different circumstances. If you'd like to get a great price on a Los Gatos home, follow the above guidelines (and begin by hiring your buyer's agent carefully!) and you will greatly improve your odds for success!

Call or email me for assistance in buying your next home in Los Gatos!

Mary Pope-Handy, Realtor,  CRS, ABR, e-PRO, SRES, ASP, RECS, CNHS, ACRE
Helping Nice Folks to Buy & Sell Homes Since 1993 - 15 Years Experience!
Co-Author: "Get The Best Deal When Selling Your Home In Silicon Valley"
Keller Williams, Cupertino, CA  (Serving Los Gatos, Saratoga, Cambell, San Jose's communities of Cambrian Park, Almaden Valley, Willow Glen,  and all of Silicon Valley)
877 397-5391 (Direct/Toll-Free/Fax);   408 204-7673 (Cell)
www.DelightHomes.com    www.ValleyOfHeartsDelight.com   
email: Mary (at) PopeHandy.com

Los Gatos Home Sales Trends

Los Gatos Home Sales Trends

The following chart shows median and average price trends plus sales in the Los Gatos real estate market of single family homes (this is for the zip codes 95030 and 95032, not the mountain areas of 95033). The chart uses a 12-month moving average to eliminate any seasonal variation. Note that overall, prices of sold homes continue to rise, even as the number of sales has been declining.

The next chart is the same as above but uses a 3-month moving average. This smoothes out month-to-month variations yet shows seasonal variations. What is unusual here is that the number of sales is not rebounding as much as is seasonally normal.

This chart shows the current inventory of homes for sale compared to the number that have sold. The larger the gap between inventory and sales, the harder it is to sell, of course. So it is a little amazing that prices are rising at all.

The next series of charts shows the same real estate data as above but for condominiums and town homes in the Town of Los Gatos. As you can see, it's a little harder on the condo and townhome market in Los Gatos. Prices do not appear to be rising in this segment of the market.

For detailed information on specific homes or neighborhoods, contact me.. And to see more neighborhoods and more data, please visit my online report: http://www.rereport.com/sj/winmph/

Data collected from MLSListings.com (REInfolink), compiled by ReReport.com - used by permission (I am a subscriber)

Mary Pope-Handy
Realtor,  CRS, ABR, e-PRO, SRES, ASP, RECS, CNHS, ACRE

Remembering San Jose's "El Dumpo":
What Makes a Fixer a Fixer?

The San Jose Mercury News was a Realtor's close friend in the 50s, 60s and 70s. It was more current than the multiple listing book (which at that time was updated about once a week with tearout or replaceable pages) and scanning the ads was crucially important to know what was going on back then. Each morning, my mother, Pat Pope (a Realtor from '56 to '96) would pour over the Merc with her morning coffee to stay current on the market.

Most of the ads were pretty plain.  One stood out for its frank humor - and it ran for what felt like years. The "old timers" in the industry may remember it. In large letters, this San Jose fixer-upper was listed boldly as "EL DUMPO". It eventually did sell but while being marketed, gave a lot of folks the chuckles.

So what makes a home a "fixer"?

At one end of the spectrum, there are homes that have been updated now and then over the years - perhaps with a kitchen remodel that's now 20 or 25 years old - but not recently. The carpet and paint need replacing and the look could be newer, but the home is well maintained and clean. Is it a fixer? The sellers won't think so and may be offended if that label is applied to their home. The agents may view it as borderline. Buyers may view it as "liveable but needing work". Or maybe not - perhaps they will wonder how the current owners could live in a home with that condition. They may consider it a fixer.

At the other end of the range is the "bulldozer". These are homes that have not been kept up at all: not updated, not even cleaned. They may have dysfunctional floorplans, illegal additions. They may need more than fixing; they may need replacing.

Once when my kids were out of school (vacation or inservice day) on a real estate board tour day, I took them along with me to see a few homes. We pulled up to one in Monte Sereno. The structure was sitting on a perflectly flat view lot close to Daves Avenue. The house was the kind of thing that makes a person say "ewww" when opening doors and seeing unpleasant, moldy surprises. My daughter, then about age seven, saw it and proclaimed wisely "Mommy, it's a 'dozer'".

Here are the types of things that will make virtually all buyers and Realtors view a home as a "fixer" (not just one of these, but multiple issues):

Simple Rules for Landscaping to Sell Your Home