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Philip E. Cabral's Blog

By Philip E. Cabral | Agent in Santa Clara, CA
  • SELL YOUR HOME FOR $100,000 MORE

    Posted Under: Market Conditions in Santa Clara, Home Selling in Santa Clara, Property Q&A in Santa Clara  |  November 9, 2012 9:35 PM  |  438 views  |  No comments

    When selling a home one has to decide whether it is best to sell the house in its present condition or remodel and then sell.

    If you are in this dilemma, I want you to think about a recent experience I had with a buyer of mine.

    I was showing my client a 3 BR/2 BA house listed for $570,000. She totally hated the 1950's house because nothing in it was updated. Two days later we visited another 3 BR/2 BA house listed for $680,000. She totally fell in love with it. The kitchen was updated with granite countertops, oak cabinets, tile floors, and stainless steel appliances. The bathrooms were also updated with oak cabinets, tile floors, and glass tub/shower doors. She immediately informed me she wanted to make an offer. I stopped for a second and started laughing. She asked why I was laughing and I replied, “Do you realize this house is the exact same model as the house you hated two days earlier for $570,000.” She didn’t believe me at first. But, since the other house was only a few blocks down we went there afterwards and, lo and behold, it was the same model. I told her I can have a contractor friend meet us at the two houses the next day and he can give her an estimate on how much it would cost to remodel the outdated house to look exactly like the one she loved. We met the next day and my friend looked at both houses and told her that for $40,000 he can make the outdated house look exactly like the house she loved.

    She thought about it for a minute. Then, she declined and instead decided to make an offer of $660,000 for the updated house, which she eventually did not win. A month later we find the updated home sold for $670,000 while the outdated home sold for $530,000.

    The moral to my story is that people will pay much more for an updated home than have to remodel an old one. If you are a homeowner looking to sell your home, it is best to remodel the home yourself for $40,000 and sell it for $670,000 then not update the home and have it sell for only $530,000, a loss of $100,000.

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  • Buy A House With Only $8,750.00

    Posted Under: Market Conditions in Santa Clara, Home Buying in Santa Clara, Property Q&A in Santa Clara  |  November 9, 2012 1:02 PM  |  380 views  |  No comments

    I have heard that 90% of today’s wealth is achieved from owning a home. I experienced this firsthand with my parents buying their first home for $26,000 in 1971. Today, that same house is valued at $900,000. That’s a whopping $874,000 gain. Far better than their friends and acquaintances that rented during that same period and have nothing to show for it. The same holds true today. But, just like yesteryear, most people think they are priced out of buying a home. So they think, and so they continue to rent.

    Here are just two examples of individuals who actually went the extra step to find out:

    My friend had only $8,750 to his name but didn’t want to miss out on the next real estate boom so he called several lending institutions and walked out with a pre-approval for a $290,000 FHA loan requiring only 3.5% down. He is currently in escrow for a home valued @ $300,000.

    A recent graduate with a $20,000 student loan, two years into her first job earning $45,000/year, $30,000 in savings, and in her first year of a Master’s program also didn’t want to miss out on the next real estate boom so she applied for a home loan with a lending institution and is now pre-approved for a $300,000 conventional loan with 10% down payment. She is currently looking at homes in Kona, Hawaii.

    Sure you might not be able to buy a house. But, how are you going to know for sure if you don’t find out. I have worked with many lending institutions and I can refer you to some if you want. I can also help you with finding that right house when and if you do qualify.

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  • 5 Simple Tips On How To Make The Best Offer

    Posted Under: Market Conditions in San Jose, Home Buying in San Jose, Property Q&A in San Jose  |  November 9, 2012 4:08 AM  |  337 views  |  No comments

    So you think that you’ve found your dream home, and now you want to make an offer.

    Here are some tips to help you get the perfect home for the best price.

    Tip #1: Get pre-approved.

    Getting a pre-approved loan is the first step in buying a home.

    Tip #2: Get professional help.

    A lot of real estate websites get their data from realtor associations and so that data can be outdated. Only real estate professionals have the most current information on homes.

    Tip #3: Get your finances in order.

    Make copies of your most recent bank statements showing you have the funds to cover the Earnest Money Deposit (EMD), down payment, and escrow related expenses and be willing to furnish it along with your offer.

    Tip #4: Compare apples to apples.

    It is best to compare similar homes (same bedroom and bath) in the same neighborhood. You must also consider that although two homes might have the same square footage, and be located in the same neighborhood, that doesn’t necessarily mean they should be the same price. A recently remodeled kitchen, finished basement, or a better view must also be taken into consideration.

    Tip #5: Have the best offer.

    It is true that the best offer is often the highest offer. However, it is also true that the lowest offer can be the best offer if it is the only offer.

    I find these two strategies have worked best:

    1. In a slow market or where the house has sat on the market for sometime: Come in with a low offer (typically 10%-15% below listed price). More often than not the seller will counter giving you an indication where they really stand on their price.

    2. In a fast market or where there are several offers for the same property it is best to come in with your highest offer or the highest offer so you have control of the table. More often than not the seller will go with the highest offer without countering offers from other potential buyers.

 
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