Newsletter

A Recipe for Selling Your Home!

 All the marketing classes say I should include a recipe in my marketing material so here you go!

Getting Ready: The first thing I would recommend is using non-stick utensils and pans. In the modern era of cooking it is very important that you remove or repair any of the items that might make your transaction stick to the pan. In other words, it is important to fix all of the major things wrong with your home before you put it on the market. Please note that I said all of the major things. It is fine line between the things that will prevent a home from selling and extraneous effort. We often experience seller’s going to either extreme. They either try to fix every little thing and it delays the home from the market and wastes money or they don’t fix enough and either the inspection or the condition prevent it from selling.

All of these issues can be prevented by a preview from us of the condition of the property before you start making ANY repairs.

Gather all of the ingredients: Nothing will deter a chef faster than not having an ingredient. I understand that sometimes you can substitute one ingredient for another but it often isn't the same. In the real estate business this means two things. The first is the selection of your real estate agent. Here is a brief recipe for that part of the equation:

35 years of experience.

#1 in your neighborhood 4 years in a row.

1400 homes sold in Avondale and Litchfield Park.

Dash of Humor

Huge Dollop of Patience

1 full cup of Professionalism

1 full cup of Negotiating Skill

2 full cups of Area Specialization

1 full cup of Personal Integrity

1 full cup of Honesty

 

Blend all of the above ingredients together and let them rise to the occasion. The result should be choosing Al Gage as your realtor.

 

The second step is to fold in an additional team of specialists to assist with the transactions. This includes Patty Miller from Driggs Title, Rita Marie from Finance of America and Eric Villaverde from Doubletree Home Inspections and you should have the most stellar team of professionals ready to go into the oven.

 

Select the Starting Temperature: This maybe the most important part of the transaction. At what temperature do you start at? If you start it to hot (too low of a price), you may actually burn some of your equity by not getting every last dollar out of the transaction. It is easy to see when its too hot because you have massive traffic and multiple offers in just a few days. This error usually self regulates because it gets bid up over the list price in very short order.

If you start out at too low of a temperature (priced to high) you run a very real risk that the bread will become stale before you ever put it in the oven. It is very important that the initial reaction to the price is not too high or low as either one can adversely effect the transaction.

Baking: Once you have pre-heated the oven to 350 degrees by placing the home in this newsletter, let it bake for about 3 weeks at the current temperature. You can test it with toothpicks and once you receive an acceptable offer, you can remove it from the oven for about 4-6 weeks and allow it to cool (I mean close). During this cooling period, all of the specialist will become involved to prepare the icing, ice the cake and either decorate it or simply add some sprinkles. All of these processes sound very simple but, in fact, they require years of expertise and constant attention. I have thoroughly vetted all of the people on that list and can generally also recommend contractors as needed.

Serving the Cake: Once the cake has fully cooled and all of the slices of the cake have been divided up, it is time for you to serve the remainder. It still remains your responsibility for the utility transfers, signing documents and directing where you want all of your slices of the cake to go. It is also your responsibility that we don’t have any candle fires as a result of the cake so make sure you don’t cancel your insurance too soon. 

If you need help baking your cake or finding out what you need to do to get your home ready to sell

Give the Al Gage Team a call at 623.536.8200 or email us at al@algage.com

 

Consumer Protections that Don't Work!

We have all heard about the latest government regulation designed to protect consumers that either doesn’t work or actually has the opposite effect! What is especially clear is there is little or no protection involved in any of these protections for the seller nor has the implications to the seller been considered at all. Let me try to outline the most egregious.

The Three-Day Closing Disclosure Waiting Period: The CFPB (Consumer Finance Protection Bureau which sounds like something from George Orwell) has instituted a three-day waiting period from the time the buyer receives and acknowledges the Closing Disclosure Statement before they can sign documents and close the transaction. This requirement is non-waivable except in extreme financial emergency. The time period is supposed to be utilized so the buyer can compare the initial loan disclosure with the final figures. Sounds like a good plan! First of all, I can do this in about 2 minutes. Second of all, the buyer probably does not know what to look for without the assistance of their agent or lender. What it actually does is either make the buyer rent a truck and pay a hotel for an extra day or three days over a weekend.

The Home Valuation Code of Conduct: This little gem was put in place as a result of the false blame (the real cause was excessive speculation on the part of buyers in real estate) placed on real estate agents and appraisers as a result of the 2008 market crash in real estate.

This program establishes Appraisal Management Companies to supervise and randomly assign appraisers. This program also prevents the agents or the lender from directly contacting the appraiser in an attempt to influence the outcome which was part of the false blame in 2008. Sounds Good?

     Well, there are several major flaws in this process. In my almost 35 years in the industry, I will start with the fact that appraisers were never very easy to influence in the first place. They are professionals but just like all of us, they occasionally make mistakes or could benefit from extra knowledge about the upgrades or improvements in the property. The VA actually has a program called Tidewater, where the appraiser has to notify and ask for information if the appraiser cannot achieve the desired sales price. We are currently permitted to supply them comparable sales if they ask for it and are allowed to provide a list of upgrades. In the good old days, when we could build a relationship with an appraiser, we could call them up and ask if a house would likely appraise, BEFORE ANYONE SPENT $650.

Speaking of the $650, this is more than double what the cost of an appraisal was before the institution of this program and is paid to the Appraisal Management Company not the actual appraiser. The appraiser essentially receives about half of that and the Appraisal Management Company receives the rest. The dirty little secret here is that many of these Appraisal Management Companies, which are supposed to be arms length from the lender, are actually owned by the lender’s they provide service to. Not exactly a model designed to protect the consumer!

The High Priced Mortgage Test: This is probably the worst offender of all. This one, among other things, prescribes that a person cannot obtain a mortgage where the costs to obtain the mortgage (including title fees) cannot exceed 5% of the mortgage amount paid by the buyer. Sounds perfect at first sight but it actually penalizes buyers who are more qualified or have more resources. All these years, you though a buyer that paid their own closing costs or put more money down was MORE likely to obtain the mortgage! WRONG!

We recently sold a home to a young couple who had saved/inherited enough money to put about 15% down AND pay their own closing costs. We absolutely stole them a home. The home was listed for $189,900 and we bid $202, 500 for the home. We were proven correct when the home actually appraised for $215,000 and the appraiser probably could have gone higher. The buyer is well qualified and ready to go when we get clarification that on initial review, they have failed the High Priced Mortgage Test and cannot obtain the loan BECAUSE THEY PUT SO MUCH DOWN AND WERE PAYING THEIR OWN CLOSING COSTS. Title fees and other fixed costs are based on the sales price not the mortgage amount. We were able to manipulate the file a bit and it closed successfully but this is not the way that it should be!

Let me give you a more illustrative example. Suppose a buyer is buying a home for $250,000 and putting $200,000 down. That leaves them a mortgage amount of $50,000 so their loan costs and title fees cannot exceed $2500. An appraisal is $600 and the title fees are $1203 leaving less than $700 for lenders fees. This will make them have to take a higher rate so they can receive a credit from the lender and does not give them the option to pay points to obtain a lower interest rate. Does any of this sound like the way informed consumers should be treated?

If you want true Consumer Protection based on the Golden Rule and old fashioned honesty, give the AL Gage Team a call at 623-536-8200 or email at al@algage.com

The Doctor is IN!

I recently had an opportunity to interview for a listing in our area. There were many of the most successful agents in our area, all interviewing for the same position. The seller selected us and as part of that conversation, they explained to one of our competitors that they were listing with us because they did not like the concept of a big team. The agent countered that proposal with a statement to the effect that when you visit the doctor’s office, the first person that you talk to is NOT the doctor! But how cool would it be if you could?

Not to be too hard on the medical profession, but lets just say that they are not known for their customer service skills as to office management. That is not to say that many doctors don’t have a good bedside manner, but I think we all agree that the waits and paperwork are simply not conducive to customer service.

 If you contact my office, you are either going to speak to the Doctor (me) or the Doctor’s Boss (my wife if you need a second opinion). We have had the huge team before and had to manage and correct the mistakes and errors of underlings and just want to be responsible for what comes out of our mouths from this point forward.

Having just done the yearly statistics for the other agents in the areas that I work just before that appointment, I was able, during the interview, to quote those statistics for my closest competitors. “Agent X, I sold 250% of their sales! Agent Y, I sold 275% of their sales.” Of course this was very powerful combined with the fact that I have been #1 in overall sales within our neighborhoods for 4 years in a row.

 Customer service is our goal combined with the actual success of selling your home. In essence, we want to diagnose the problem, treat the problem AND do it all while having a single point of contact throughout your transaction. No passing your file off to someone with minimal experience that has to continuously get back to you with the more experienced answer.

But don’t take my word for it. Listen to what our clients are saying in 2019. One of our clients said:

As we all know, selling a home can be extremely stressful. Al Gage was wonderful! He was very professional and knowledgeable in all aspects of the sale. What impressed me the most was his direct approach, none of the usual sales jargon was imposed. If your looking for a good, honest and down to earth realtor, Al Gage is your man. Also a shout out to Terri who is an absolute delight to work with.”

This review sums up everything we are trying to put forward as our philosophy in business. They characterized us as professional, knowledgeable, direct, good, honest and down to earth! You may ask how we do this? It is easy! We work efficiently and and for many long hours to service our clients.

In another review, one of our clients writes: “My house went on the MLS the next day, New Year’s Eve. I averaged one showing every day and received an offer in 6 days, higher than the list price, and closed in 3 weeks. There were 2 unexpected large repairs required before closing but Al’s accessibility by phone, text, and email, at all times, enabled the parties to resolve the matters efficiently and to everyone’s satisfaction. I would highly recommend using Al Gage.”

Again the review strikes at some of the core values of our business. Answering the phone and being prepared to offer expert advice and referrals on a moment’s notice comes with over 34 years experience. We pride ourselves in answering the phone and working efficiently. My wife and I were both blessed with great work ethic inspired by parents that had great work ethic. It does not bother us to work 12-15 hour days if need be. We would love the opportunity to work that hard for you.

 If you want to have the doctor answer the phone, diagnose the problem, treat the problem and give you a perfect prognosis on the first visit, schedule an appointment with Al to sell or buy your home.

 Al Gage

al@algage.com

623.536.8200

 

Thats a Great Question!

I got asked a great question this week by two different clients, so I thought it worthy of an explanation.  The question was two different versions of the same question.  Essentially, since I publish the price per square foot of the homes in the various neighborhoods, why couldn't they just multiply that price by the square foot of their existing home and come up with a price.  The second version was why do larger homes and/or two story homes sell for a lower price per square foot than small and single level homes. Those are both great questions but not the same questions although the answer maybe close to the same for both.

The average price per square foot is exactly that, an average.  In all of our subdivisions there are parts of the subdivisions that sell for more than other parts.  In Corte Sierra, Sage Creek and Las Palmeras, Sage Creek will typically sell for more than the other two.  Crystal Gardens will sell for more than Crystal Point or Upland Park and in Rancho Santa Fe, Alta Mira will sell for more than Vistas, Tierra or Casitas. 

There are valid reasons in all of these.  The lot size might be bigger across the board or the average house might be larger or smaller. Let’s take Rancho Santa Fe as an example.  The average lot size in Casitas is smaller than Vistas but larger than the other newer subdivisions on the West Side.  Even when they were all brand new, there was a price per square foot difference between the areas.

Over the years of working in these areas, I have developed definitive numbers to adjust between one subdivision and another and also within different parts of the subdivision.  It took me forever to determine how much to adjust between a home on the lake in Crystal Gardens versus one that was not on the lake.  Every time I try to present these to a client, they usually say something like “but I wouldn’t want to live there or on the lake.”  This is true and also the reason why you didn't purchase a home in the area or part of a subdivision or on the lake———Because it wasn't worth the difference in the price for that amenity.  Let us keep in mind that for the buyer who is looking for that amenity, it is worth the difference.  This is why you need an area expert to price your home! When I go to price a home outside the area that I work,  I have to work 10 times harder to get it right and I am much more susceptible to error because I am just not as familiar with the adjustments to make.

When you choose an agent that is not an area expert, you risk the same kind of problems. 

For the second part of the problem of why smaller homes sell for a higher price  per square foot than larger homes, it is basically a combination of economics and when you really analyze it, it becomes clear.  Let’s look at the lowest price home for sale in Rancho Santa Fe which is a 1290 S.F model.  That’s $170.5 per SF.  If you multiply that number by the largest home for sale in the same subdivision which is a Regatta (2963 S.F.) that would mean that the price of the larger one would be $505, 191 instead of the $379,000 it is listed for. To  my knowledge there has never been a sale for more than $500,000 even in the boom. If you apply the simple multiplication mode, you should all run over there and offer them about $100,000 more than they are asking.  Bottom line, it simply doesn't work that way. 

The same thing applies when it comes to a two story versus a single level.  More people prefer a single level and therefore, the single level will sell for more per square foot than a two story. 

This still doesn't explain some oddities such as what happened in Rancho Santa Fe last month.  Two identical homes with the same general features including a pool, sold for $117 and $136.5 per square foot.  Even allowing for the difference in condition, either the higher one got lucky or the lower one sold too low.  Don’t be the guy that sold their house too low because you sold to an I-Buyer, used an inexperienced agent or made a mistake in negotiations.  Call Al Gage at 623-536-8200 or email us at al@algage.com

 

Subscribe to Newsletter and Add to the Count for Free Movie Night

From 1997 to 2007 we hosted a free movie night for all of the homeowners in Rancho Santa Fe, Corte Sierra, Sage Creek, Crystal Gardens, Las Palmeras and Wigwam Creek as well as our past clients.  We would love to offer this little payback to our community again but with the price of mail and printing, the only way we can do that is with your help to promote the E-newsletter to the same level of readership as the mailings touched in the past.  In addition, we would be saving a few trees.

So here is the deal, if we can get our readership up to around 3500 per month from our current level of just over 1000, the savings in mailing and preparation cost will allow us to once again rent the entire movie theatre for our neighbors and clients. To accomplish this we will need each of you to forward the email or website to friends and have them opt in for market updates and eventually the free movie passes. We will keep a running count of the opt ins and when we reach 3,000 emails currently living in the Phoenix, Avondale, Goodyear, Litchfield Park and Buckeye areas, we will fire movie night back up

The Final Decision!

Do you remember when you were kids and you had to ask your parents for a decision.  I remember that when I would ask my mom if a friend could spend the night, she would invariably tell me to go ask my dad!  I would dutifully run to my dad (they worked together running their business) and ask!  He would always respond with “What did your mother say?”  Of course, I would respond with the obvious answer that she sent me to ask you!  He would always say “Well that’s up to her!” And the cycle would repeat!  Now I get that they may have had an ulterior motive to try to burn off some of my limitless energy, but I truly believe they were just trying to be consistent and on the same page.  Of course, there were rules about the circumstances under which you asked for this permission and if you ever violated them, the answer was automatically “NO!”  If you asked with the person you wanted to have stay over present or if it was on a school night, the answer was automatically no! If you asked too often or while they were busy talking to customers that was also the kiss of death!  If you followed all the rules and never showed your impatience with the lack of a decision, they were always very fair about granting such permissions.

     Now as I watched the Superbowl, I watched two very good quarterbacks make decisions about passing the ball!  The decisions they made all occurred in less than five seconds.  That’s not much time to think, considering any of those decisions could define their careers.

     As drivers, we make life or death decisions on a regular basis in less than a half second.  The time it takes to go from the accelerator to the brake or to change lanes. I do have faith in the ability of our society to make decisions.

     A good friend of mine was telling me about some of the Realtor commercials running in Canada right now!  They feature people who didn't use a Realtor or an inferior Realtor, and the consequences they have suffered by their poor decision.  One family ended up next to a newly built oil field and another ended up next to a biker rally every weekend.  All of these are items which a realtor is supposed to know and disclose to a potential buyer (and so is the seller). 

    Your first decision in the house buying or selling process is to choose a Realtor and obviously, we want you to choose us, but we have preached enough on that topic.  How many other decisions and decision makers are involved from that point forward? Here is a list of the people that must say yes in the home buying process in order for it to successfully close:

Seller and buyer each choose an agent.

Buyer chooses lender and pre-qualifies

Lender issues a preliminary qualification for the buyer.

Buyer chooses to view home.

Buyer decides they like a home enough to write an offer.

Seller decides to accept an offer or counter.

Buyer accepts counter offer.

Buyer chooses to perform an inspection.

Title company issues an initial title report and property appears clear to proceed.

Buyer accepts, rejects or offers the seller an opportunity to make repairs on property.

Seller accepts, rejects or agrees to repairs.

Appraisal comes in at value or price is renegotiated to appraised value.(If lower than contract price)

Buyer choose a Home Warranty Company.

Repairs are undertaken to be approved by the buyer.

Underwriter reviews loan documentation and either approves or asks for additional documentation.

Underwriter approves loan with final approval after appraisal is received.

Loan is sent to secondary buyer or quality control for last minute review.

Title company issues final title report and both parties sign.

Documents go back to lender for release of funds.

Funder releases funds after balancing with Title Company.

Loan and property closes by recording at county recorder’s office.

Buyer and seller exchange possession of property and keys!

 

That’s a lot of people that have to say “Yes!” in order for a transaction to close.  Don’t you think you want someone who has gone through this process over 3000 times to be on your side?

 

For experience and integrity, give the AL Gage team a call at 623.536.8200 or email us at al@algage.com

 

Its the Little Things

 In real estate, it’s the little things that make the difference! We are all a product of our experiences and we haven’t all experienced the same things. There are little tricks of the trade that separate the great real estate agents from the mediocre or down right bad agents. 

Let me give you a non-real estate example. Have your ever fought with a roll of aluminum foil? Pulling out too much or too little, the roll flopping out of the box, down the kitchen counter and on to the floor. How many of you knew that the end of the box has little tabs that you can punch into the end of the roll which will hold it in the box and prevent this from happening! I know I had to run and look when I first heard about this and I will pause for two minutes while those of you who have never heard of this go and look! Now that we have verified that they are there, let me give you some other examples both within and outside of real estate! 

 

One of the tricks that we have mastered is the number of pictures required to get optimum placement on many of the real estate websites. Too few or too many or redundant picture and you move down in your placement. I would love to share the number with you but then I would lose the advantage. I will just tell you that I obtained the information, on accident, from a tech from one of the biggest real estate websites.

 

How many of you have ever had your garage door opener malfunction because the eyes on the anti reverse are misaligned. Pro tip! You can override that by simply holding down the button while the door is closing. Not a long term solution but it will let you close the garage door for the night and you can fix it tomorrow!

 

Did you know that you can take the chill out of the house and use less energy in the winter time by reversing your ceiling fans? There is a little switch on most fans that will make them run in reverse, which is clockwise, which pushes all the warm air back down to where you live and off the vaulted ceilings.

 

In sales, it’s the little things. Like answering your phone and returning phone calls. Whether its another agent or a client, we try to respond to all of our calls within an hour and most of the time we actually answer the phone when you call. This may sound odd to you but you would be surprised by how many agents are “Just to Busy” to answer their phones. We sold 217% of the average of our top ten competitors in 2018 but we still find the time to answer the phone.

 

Over the years, one of the common problems we encounter on a home inspection is the dishwasher will not start after the home has sat vacant or the dishwasher hasn't been used. There is usually nothing wrong with the dishwasher. The motor is just stuck because of our hard water. If you take the lower cover off and spin that motor it will work 9 times out of 10.

 

One of the best tricks that we use isn't really even a trick. When an agent calls and says they might be writing an offer on one of our properties, we don’t give away the farm. We thank them and generally welcome their offer. We don’t gush with excitement about the fact they are writing an offer. This conveys to them non-verbally that they may have to write a little better offer to get it accepted. Selling homes is a lot like playing poker. Many, many agents give away information or tells to their fellow agents without even realizing they are doing it.

 

Every industry has these same kinds of little tricks. I remember a plumber laughing so hard, while he was apologizing to me for charging me, that it kind of hurt. I had installed my own brand new garbage disposal and was proud of my work but the dishwasher just would not drain. Who knew there was a seal in there for the disposal to be used without a dishwasher, that had to be knocked out before the drain line was attached.

 

One of our best tricks is not leaving our homes in active status trying to get back up offers. Back up offers sound good in principle, but they rarely materialize. Your days on the market continue to add up making the home prematurely stale if you should have to put it back on the market.

 

If you want an agent that barely knows the ropes or is possibly not a good poker player, then call someone you googled on line.  I have been working and been the most successful agent in your area for almost 20 years or since these homes were built. You need a savvy, honest and straightforward agent!

 

Call Al Gage at 623.536.8200 or email us at al@algage.com