According to the media, the average 30 year fixed rate is around 7%. We have a client buying a property right now with a 30 year fixed rate locked at 3.7%. Her loan is with Citi. I asked the lender how the rate got so low in today’s climate. He said with good credit and for the purchase of a primary residence with 20% down, the 30 yr fixed rate, with 50k in relationship, starts at 5.25%. With more of a relationship, the rate gets adjusted downward. Our client’s family has a relationship with Citi. Another member of her family is in escrow on a higher priced residence and his locked rate with Citi is 4.3%.
In our business, we pride ourselves on selling properties for top dollar. Over the 16+ years of working as a real estate agent, we haven’t often lowered prices on our listings. We’re local neighborhood specialists who understand and intimately know the values of the houses in our neighborhood and we price houses correctly so that they sell without lowering the price. Over the course of my real estate career, most of our listings have sold in 60 days or less without price reductions.
This year in June, a seller asked me to lower the list price on his house to make it sell faster. I was vehemently opposed to lowering the price because I was positive that the list price was correct and if the seller just sat tight an offer would come shortly. The seller actually told me to put my pride aside and lower the price to sell his house now. I was positive that lowering the price was not smart. I begged for one more week and we did get an offer that week and the house sold. We did not do the price reduction.
This week it was a new and weird phenomenon to adjust prices on our listings. 409 N June is now priced at 6,499,000. 2405 5th Ave is priced to sell now at 1,699,000. 1332 Belfast is now priced at 3,490,000. 458 N Alta Vista is priced to sell now at 1,699,000. 1354 Fairfax is priced now at 1,549,000. 612 N McCadden will be staged this week and it will go on the market primed to attract multiple offers at a new price of 2,999,000.
Our perspective is that it’s smart for buyers to first shop around for the bank that will give them the best interest rate; relationships are key to getting the lowest rate. Most loans can be adjusted downward soon as interest rates go down again; smart to ensure there’s no barrier to prepayment. Once a buyer’s loan is strategically secured, it’s smart for buyers to find a property where the purchase price accounts for the buyer’s cost of financing. And then today’s market can be a cool time to buy. Every day we meet homeowners who built so much wealth through homeownership. And we meet renters who regret that they have not accumulated wealth through other investment vehicles outside of real estate. Homeownership offers so many benefits in addition to wealth accumulation, some of which are tax benefits, privacy, and freedom of customization and living in a beautiful space.
In our daily travels, the people we meet who acquired the most wealth through real estate are those who consistently act and engage. Savvy people buy and sell in every market, strategically making calculated well reasoned moves. The people who consistently sit on the sidelines, scared and waiting for more and better opportunities and for the market to feel just right, end up always waiting and never acting because the only time that feels just right is the time in the past that’s already over; it only feels just right in retrospect. Cool savvy people figure out how to mastermind and make the present just right.
I’m so sad for my sister-in-law Shoshy that her incredibly loving dad, Shimon Stern, passed away. He was diagnosed with an incurable illness 18 years ago. He long outlived the life expectancy for his illness, willed entirely by his overwhelming love for his family and all the people around him. He chose to live the last year on palliative care, surrounded by his completely devoted family who loved him right back. Both his family who lived close and those who lived far spent the last year together with him, all of them completely and entirely wrapped up in their mutual love for one another. He passed away surrounded by all his kids and in-law kids singing his favorite songs and loving him with all their heart and soul until the very last second. To me, a hero is someone who both gives and receives love and cultivates a family of people reciprocally devoted to one another. Shimon Stern will always live on as an inspiration for achieving all that love that will continue to be passed on forever.
For those who celebrate this week, Happy Sukkot!
Xoxoxoo,
Sheri
