It’s no secret that the real estate market has slowed, yes, including Burbank’s. But nonetheless, life goes on – people die; families grow or contract; people get job transfers and/promotions; renters want to buy and start building wealth; etc. Point is, when life happens, you can’t  always wait to do what you need to do with your real estate holding(s) in the most favorable market conditions, you have to act now, in today’s market – whatever that market may be. Obviously, higher interest rates for home loans have been the fundamental catalyst for the current slower market. That, along with a continuation of extremely low inventory levels has made for an even more challenging market, more so for Buyers. However, for Sellers, things aren’t as pessimistic. After a historic “low interest rate/Pandemic run up” in property values of approximately 25%, the current market reflects only about a 5% reduction, thus far, from those inflated highs! Again, due to very low inventory levels and Buyers coming to grips with the new normal of higher rates, Burbank Sellers still have the upper hand! BUT, the days of multiple offers written with aggressive terms just to be able to compete, along with the corresponding ever-rising prices are now gone! So, if you’re contemplating selling, FIRST CALL ME 🙂 and keep the following in mind:

First) PRICING  Good, bad or transitioning market, appropriate pricing is always the primary key to success in selling a home! With the rise in rates and consequently the Buyer pool becoming smaller, those remaining Buyers are serious and savvy. And due to those higher rates, their monthly costs are hundreds of dollars more, so they’re even more unlikely to get caught up in bidding wars and overpay unless it’s a trophy property with intense interest and they perceive the original list price was appropriate for the current market. SECOND) CURRENT MARKET TIME  Today, I tell my Sellers that if you’re still on the market after 30 days with no viable offers and slow showing traffic, it’s a safe bet that you need to make a price adjustment. When the market was flying, that time frame was two weeks! THREE) REPAIRS & CONCESSIONS Again, another remnant of the red-hot market we’ve exited was a sentiment like this: “Sold as is – No concessions, repairs or credits; and if you don’t agree, fine! There are multiple “runner up Buyers” just waiting for you to walk away!” Not so easy to take that attitude these days! We’re back to reasonable repair requests, NOT a wholesale renegotiation of the sale price!

Just a few things to consider. If you’re thinking about selling in THIS NEW MARKET, let me and my 36 years of experience guide you with a more in-depth discussion tailored to your individual situation and property.

With interest rates and the “cost of money” continuing to rise, several things are beginning to change markedly in the real estate market. One noticeable change that recently has become very palpable to me begs the question: “Where have all the those flippers gone?” Well, with higher borrowing costs, a reduced Buyer pool and still a very limited supply of inventory (as of this writing, only 33 Active SFR listings in Burbank) the “flipper ranks” have been thinned considerably! This became very apparent to me when I recently brought out a new listing in Burbank, that 6 to 12 months ago would have had me deluged with inquires and offers from them. Although the property is in the flight path of the Hollywood-Burbank Airport, it’s a relatively large 4BD, 3BA home, approx. 1,700 sq. ft. with most of the infrastructure/main operating systems updated or replaced. However, the home is admittedly dated and in need of cosmetic updating. It’s listed for $1,045,000 – one of the lowest priced listings and lowest priced per sq. ft. ($616) homes currently on the market. Again, a few months ago I would have had a ton of interest and offers from the flipper crowd! Now, I’ve still got flipper interest, but the ridiculous, borderline desperate variety!

With prices moderating, material costs and carrying times increasing, these guys can’t attain the profit margins when they resell their shiny new products that they used to. Sooo, they have to be able to acquire properties at lower prices to hit their profit targets. I’ve seen the result of this dynamic with two ridiculously low offers within the first days of my listing hitting the market. One offer was $175,000 below the list price and the other $65,000 below. Neither one of these so-called agents personally saw or showed the property to their LLC entity Buyers, nor bothered to call me before submitting their “low balls” to explain their rationale. Nope, just throw nonsensical offers out there and hope something will stick with an uninformed agent and/or desperate Seller. I don’t price homes to appeal to a certain type of Buyer. I work with my Sellers to price a property reasonably and at fair market, as indicated by like for like closed sales reflective of the current market, preferably no older than 90 days. By the way, thanks to properly pricing my client’s home, WE ENDED UP GETTING FULL PRICE! Yep, the market and ranks of flippers are both experiencing reduced inventories – and that might just be a good thing, at least when it comes to flippers! What do you think? I’d love to hear from you!

HAPPY 2023! As in past years, I like to report out where the real estate inventory levels are at in Burbank as we begin a new year. Suffice it to say, what a difference an activist Federal Reserve and an interest rate raising campaign make as we begin 2023! Recalling last year’s numbers relative to what we begin with this year, paints a pretty clear picture of what a higher cost for money/financing has done to the real estate market! Last year, with rates nearly half of what they currently are (3.50% – 4.25% range vs. today 5.625% – 6.50%), it’s no wonder the market has slowed, NOT CRASHED, with inventory levels increasing markedly!

Last year, we began 2022 with a whole 15 Single Family homes (SFRs) and a mere 8 condos listed for sale. This year, we begin with 44 SFRs and 18 condos/townhomes for sale! Now, relatively speaking, that might seem like quite a jump. But keep in mind, a so called “normal” market has historically contained approximately six months worth of inventory; today’s still only contains a little over one months worth – still not a lot of product to show would be Buyers! And despite the rate increases, Buyers are still out there due to relatively strong demand vs. supply, combined with Burbank’s desirability, convenient location, civic amenities and affluent employment sectors. The biggest difference between last year and today – in my opinion, is the “crazy factor” in the form of multiple offers bidding on almost every active listing that were merely decent, has moderated significantly! That said, so called highly prized property – superior location, tasteful/distinct appearance, quality updates, etc. are still getting plenty of attention. But instead of 10-25 offers, those “trophy properties” are now garnering more modest interest. In terms of pricing, WHICH IS ALWAYS KEY – you’re seeing list prices come down a bit and days on market increasing. And instead of seeing 20+% appreciation, this year, you can expect a flat to five, perhaps 8 percent appreciation rate, at most. We’ll see….