Frequently Asked Questions

Online resources like Trulia or Zillow and others are very useful as a quick guide to information. But the question is where do they get the information? They get it from the Multiple Listing Services (MLS) of real estate agents across the country. They can only keep and so much data and do so to provide general information for consumers. They are a great guide and introduction.

But when you want a more thorough look into the data, the local MLS maintained by real estate professionals will have more information going back much further. Information is everywhere now but what is most valuable is the ability to select, interpret and analyze the vast amounts of information out there. This is especially true in real estate.

A real estate professional will have access to the kinds of data you want and can also help you refine what you are trying to find out. Real estate agents with experience have been through more than a couple of market cycles and can put the data in context.

I have found that being an ongoing resource for my clients even when they are not in the market is as important a part of my work as heloping with buying or selling. Any agent can pull out the data you want, but I recommend asking someone you can trust and will be there over time when you need it and can helop you use the data to its best advantage.

The most likely candidate is price. There is always some price that will attract buyers.  If you are the lowest price in your area for what you are offering then you will most likely be the first to receive offers.  When you have many poepl looking but no offers it means real buyers are deciding to go elsewhere. If your price is significantly off what the market will support you will be attracting the wrong buyers who are expecting more for their money and you will not be attracting buyers who can actually afford your house.  Buyers and agents will usually search for properties within a range.  If I can afford homes from $500,000-$600,000, I may not be looking at homes over $650,000 for example.  If you are priced there but the real market value is in my range I may never consider your home because it is out of my range.

There can be other factors that can be an issue as well. Some properties have one issue that buyers cannot get past in a competitive market. For example if you are on a very busy road, you may appear priced well but buyers simply go to other homes that are similar but are n a quieter street. In that case, the price is still the issue because you cannot change your street and you need to make your house a better deal.

Sometimes there are things that can be done with how a home shows that can help. Talk to your agent about what comments they are getting. What is it that buyers are saying about your home?. Maybe it can show better.

Find out what has been selling that is similar to yours. If they are all priced better then the answer will be obvious

 

If you did not sign a buyer broker or other agreement with the agent then you are not likely to be contractually obliged to use that agent. This can happen very often. Most buyers do not spend enough time interviewing an agent to be sure they are the right person to hire. This is often due to lack of experience in using real estate services. Many buyers often call on ads and go out with the agent who answers the phone. This may or may not be the best person for you. In California law and many other states an agent may represent the buyer exclusively even though the commission is "paid" by the seller. If you think about it though the seller gets the money from the buyer in the purchase price, so who really is paying?

In any case, when an agent is representing a client as a buyer there is much more than just letting them in the door. Your agent has a fiduciary relationship to you - that means one in which your trust, their loyalty and effort must be on your behalf. The right agent will bring many skills and knowledge to bear on your purchase. THey will know the market thoroughly and be able to advise you on value, pitfalls, inspections, loans, title issues and more. They also need to be a great negotiator.

It is also important that you just have the right chemistry with each other. You should feel comfortable. If for any reason you do not feel that the agent has the background or qualities that work for you, then find the right one. Having the right agent on your side can save you significant time and money. Take the time to interview the agent first.

You do not have to work with anyone that is not right for you.

There are many ways to approach this. From your question I am assuming you are a first time investor. There are many aspects to consider and whomever you go to for advice, the quality of the advice will be tied to the quality of the person giving it. Among the issues to consider are:
  1. Is this the right kind of investment for you and do you have the resources for it? If you need help in this area it can come from a financial professional or your CPA, etc. You want to be sure that among all your investment choices real estate is right for you. This can vary quite a bit depending on your overall financial picture, your tax situation, your risk tolerance and more.
  2. For a real estate investment where you buy is very important. Buying out of your home area has additional risks and you should understand what those are. They are generally related to property management, but also involve getting educated about the market you are investing in. Some of that information can be found online and the right real estate professional can be invaluable in helping you here.
  3. You can also be doing research and educating yourself about owning property as an investment and learning how to evaluate income and expenses and determining the rate of return that such an investment can produce. While real estate can be an excellent investment, it is often oversold and advertising can be misleading. Claims for “cash flow” often turn out to be untrue or overstated. Learning how this is really calculated will help you evaluate properties when you look at them.  Again the right realtor can be a help in this.
  4. Once you are clear about all of the above you can get “pre-approved” . I do not agree with the idea that realtors won’t talk to you if you are not pre-approved. Perhaps this is true for some but I certainly believe that all clients at least deserve an introduction and consultation. Once you are ready to move forward, then being pre-approved is essential. There is nothing wrong with getting this done as early as possible. It also may help you determine if you are ready to make this kind of investment. A good mortgage person can also help educate you on the kinds of loans available for investment-rental property. These loans are different than the ones for homes that are a principal residence.
As a starting point I have an article on investment property you can read.
 
When choosing a realtor, be sure to find someone who works with investment property. It would be a plus if the agent is also an active successful investor, so they have the experience and background to help. 
 
Sonoma County has many good reasons to select it as a place to invest, but like any market you can make good and bad choices within it. A few years ago Las Vegas was oversold as an investor’s dream. Many of those investments turned into huge losses due to overbuilding and an even bigger collapse of the market there as a result. So thorough research about the local economy, market conditions looking forward and back are essential.