Home Buying in Almaden>Question Details

Trulia San J…, Home Buyer in San Jose, CA

What are some tips for first time home buyers to compete with the powerful investors in the San Jose market?

Asked by Trulia San Jose, San Jose, CA Fri Apr 12, 2013

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Some of the things desperate buyers are doing is trying to work with the listing agent. This is the wrong approach. That listing agent has so many offers that they really can not represent a buyer and a seller fairly. What the professional agent will do is refer those buyers to in house agents. That agent does not have a rapport and trust with the buyer, and is having to hurry up to get to know their financial situation, their background and in short time try to sell that buyer to the Listing Agent.

A buyer really needs to commit to one agent so that that agent can get them approved with a known trusted lender, and the agent can get to know the buyer and connect with that buyer so sell them on their offers. When the buyer begins to trust their agents advice they have a better chance of winning the offer.
Web Reference: http://www.terrivellios.com
3 votes Thank Flag Link Sat Apr 13, 2013
Very good answers below. But there is no simple answer to your question, unfortunately. You and your agent have to customize your offer by responding to the needs of each seller. Money is the driving factor, but there are other factor that may be important to one seller that may not even be on their top 10 for another seller. A seller who is also trying to buy a move up or move down home will need rent back and will respond positively to a rent back offer; whereas to an investor a rent back offer will have zero value. Some sellers will respond a certain way to a quick close and other will not. The key is to have your agent do their due diligence and find out what is important to the seller and hit those issues in positive manners.
1 vote Thank Flag Link Sat Apr 13, 2013
Cash is king now days. But on ocassion, not all cash offers goes smoothly. There are lots of things that can go wrong during the sales process.
But by being first to make an offer, well over asking price, can keep you in the game longer for a particular home. Also; A Letter that accompanies your offer may help induce the seller to accept you as the new owner of their home. The letter needs to be compelling and from the heart. It just may suede the seller your way.
Getting the seller on your side is key and sometimes a dubious task when competing against all cash or heavy down payment offers.
1 vote Thank Flag Link Sat Apr 13, 2013
Thank you for your question:

Terri Vellios makes an excellent point. If you are to have any chance at all of getting a home, you must select a knowledgable, experience REALTOR to represent you. I know that many people think that if they buy from the listing agent they will get a better deal.

However that is not the case. In our office, when we have a listing of a house for sale, the phone is ringing off the hook with people who want to buy that house and represent themselves to get a better deal..

We must represent the best interests of the seller that we represent. In almost all cases a knowledgeable experience REALTOR from another company will have an offer that is better in price and terms that is better than any of the offers from the people who want to represent themselves to get a better deal. It is not uncommon for us to have 10, to 20 or more offers on any listing that we have for sale.

We must go with the offer with the best price and terms for our client, the seller.

With respect to the issue of investors. Yes, I realize that investors are often the scapegoat to blame to for high housing prices and the lack of homes available for sale.

The investors have dropped out of the San Jose market.

The investors were very active in 2010 and 2011, when it was a buyer's market, and it was almost impossible to give a house away. However as the market changed from a buyer's market to a seller's market in 2012

The investors have dropped out of the market.

The people who are buying single family homes today are buying for themselves as owner occupants.

We are seeing more buyer's from overseas.

Recently I was showing homes to a woman from The People's Republic of China. Her husband is a successful businessman in China, but they want a second home here in The United States of America because they are concerned about the rather unstable political situation in China.

They do business with local businesses here in the Silicon Valley.. To be safe, they want a second home available in The United States of America, preferably here in the Silicon Valley, in case they feel the need to leave the People's Republic of China because of the Political instability in The People's Republic of China.

Also, recently I was showing homes to the owner of a business from Europe. He is thinking of moving his business from Europe, to here in the Silicon Valley, California. He thinks the business climate here in The United States of America is better than the business climate is in Europe and many of his customers are businesses, here in the Silicon Valley.

(Governor Brown will be delighted to hear that)

Both of these buyers are all cash buyers, so we do not have to deal with the issue of financing and appraisals. Both of these buyers are buying homes for themselves to live here, not as investments.

Right now you do need a large amount of cash if you are to be successful purchasing a home. There are large numbers of people who want to buy homes for themselves who do have cash. Right now, those are the people who are successful purchasing a home for themselves and their families.

Difficult financing and ridiculously low appraisals are a huge problem that needs to be overcome.

We have large numbers of people who want to live here and very few homes available.

We do have land here in the Silicon Valley that could be built with more houses, but the Politicians will not permit that land to be developed.

One of the contractors that I represent has family members who own a ranch of several hundred acres here in the Silicon Valley. They would like to develop that ranch to single family homes.

However the City Politicians are absolutely determined that the land remain undeveloped.

My client and his family would love to build single family homes on that ranch. If the City would give us permission, my client could build 700 to 800 homes on that ranch. That would double our current listing inventory of homes available for sale.

Of course, there is nothing that I would like better than to have the listings on all of those homes.

However the Politicians say no and will not give my client permission to build.

Much of our housing shortage is artificially caused by Politicians who will not permit development.

If people want to have homes, they will need to get after the Politicians to permit homes to be built on land that the Politicians think should remain as agricultural use.

The Politicians who will not permit more homes to be built must be voted out of office.

Personally I think that it is more important for people to have homes to live here rather than force the local landowners to keep that land as an agricultural use.

Thank you,
Charles Butterfield MBA
Real Estate Broker/REALTOR
American Realty
Cell Phone: (408)509-6218
Fax: (408)269-3597
Email Address: charlesbutterfieldbkr@yahoo.com
1 vote Thank Flag Link Sat Apr 13, 2013
I would say that they need to understand what they can afford ie: they get pre approved by a lender. Then the need to go after properties that are below there budget so that they can bid over asking. They need a GOOD realtor who understands the areas, how to put a bid together that competes with the way the market is and stays with-in the budget the buyer can afford. As mentioned earlier the buyer needs patience. I find that first time home buyers are understandably very careful and cautious and afraid of what to do and how to do it this is where there realtor needs to be at there best and give sound advice without pushing the buyer beyond what they can easily handle. If done right they should eventually find success.
At your service,
Certified Distressed Property Expert
1 vote Thank Flag Link Sat Apr 13, 2013
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Web Reference: http://lamsondang.com
0 votes Thank Flag Link Sat Apr 13, 2013
Be patient and hope the investors run out of money.
0 votes Thank Flag Link Sat Apr 13, 2013
Have a good realtor, have a strong pre approval from a lender that's it. Sellers do not care where the money is coming from so your realtor needs to present it strong. In some areas you will obviously have to bid higher than asking price. If you are up for it find a fixer because not as many people are interested.
Web Reference: http://Www.talktodwayne.com
0 votes Thank Flag Link Fri Apr 12, 2013
Web Reference: http://talisrealestate.com
0 votes Thank Flag Link Fri Apr 12, 2013
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