Question: In your column, you suggest that home sellers pay for presale seller inspections. You go on to promote home sellers to buy down the prospective homebuyer’s mortgage interest rates. You call it a seller concession. When we were homebuyers, we paid for our inspection. We also paid our closing costs without any seller assistance. The same goes for all adult children. We are about to put our Bay Area family home of 40 years on the market. Why would we add those costs to ourselves when we need the proceeds for our retirement?
Answer: The utility of presale seller inspections exponentially increases consumer confidence in the homebuyers’ minds. This is my experience. Presale seller inspections dramatically reduce the chances of post-sale litigation. Full stop. As homebuyers, you and your adult children bought homes at one standard of practice. Agents included. You all should set exacting standards of practice as home sellers. It pays. Home sellers offering to buy down the prospective homebuyer’s mortgage interest rates inspires homebuyers to act. It works. Raising the standard of your home’s listing and sale demonstrates empathy for the homebuyers. That is a fact. You will attract more homebuyers — and the more interested homebuyers there are, the higher the offers and net proceeds.
See an example of headlines that homebuyers read. Plus read about, in July 2023, single-family home prices and costs at a 6.84% 30-year fixed interest rate for the nine Bay Area counties via the California Association of Realtors. You are in control. You can provide utility, inspiration and empathy. Or not. The results will speak for themselves.
On September 13, 2023, the Mortgage Bankers Association’s (MBA) press release stated: “Mortgage applications decreased for the seventh time in eight weeks, reaching the lowest level since 1996. Last week’s decline was driven by a 5 percent drop in refinance applications to the weakest reading since January 2023,” said Joel Kan, MBA’s vice president and deputy chief economist.
On September 14, 2023, Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors (NAR) released:
“After last week’s dip, mortgage interest rates for the 30-year fixed are back up to 7.18% from 7.12%” and “It is no wonder, then, when looking at NAR’s Housing Affordability Index, the reading this last week was 87.8: the lowest point since July 1986 when the index was 87.7.”
• In Alameda County, the median price of a three-bedroom home of $899,000 with a 3% down payment of $27,000 is a monthly payment of $6,742; with a 20% down payment of $180,000, it is a monthly payment of $5,742.
• In Contra Costa County, the median price of a three-bedroom home of $795,000 with a 3% down payment of $24,000 is a monthly payment of $5,964; with a 20% down payment of $159,000, it is a monthly payment of $5,079.
• In Marin County, the median price of a three-bedroom home of $1,425,000 with a 3% down payment of $43,000 is a monthly payment of $10,837; with a 20% down payment of $289,000, it is a monthly payment of $9,299.
• In Napa County, the median price of a three-bedroom home of $1,650,000 with a 3% down payment of $50,000 is a monthly payment of $12,374; with a 20% down payment of $330,000, it is a monthly payment of $10,538.
• In San Francisco County, the median price of a three-bedroom home of $1,500,000 with a 3% down payment of $45,000 is a monthly payment of $11,249; with a 20% down payment of $300,000, it is a monthly payment of $9,580.
• In San Mateo County, the median price of a three-bedroom home of $1,749,000 with a 3% down payment of $54,000 is a monthly payment of $13,435; with a 20% down payment of $358,000, it is a monthly payment of $11,442.
• In Santa Clara County, the median price of a three-bedroom home of $1,550,000 with a 3% down payment of $46,000 is a monthly payment of $11,621; with a 20% down payment of $310,000, it is a monthly payment of $9,896.
• In Solano County, the median price of a three-bedroom home of $598,000 with a 3% down payment of $18,000 is a monthly payment of $4,488; with a 20% down payment of $120,000, it is a monthly payment of $3,822.
• In Sonoma County, the median price of a three-bedroom home of $985,000 with a 3% down payment of $30,000 is a monthly payment of $7,387; with a 20% down payment of $197,000, it is a monthly payment of $6,291.
For Housing Market Data in your area, visit my webpage for trends here. Do you have questions about home buying or selling? Full-service Realtor Pat Kapowich is a Certified Trust and Probate Specialist, Certified Real Estate Brokerage Manager and career-long consumer protection advocate. He is based in his hometown of Sunnyvale, California. Office: 408-245-7700; Broker# 00979413 [email protected]