Another show on HGtv? Yes, and your home can be the star

Will those nice folks at HGtv never run out of ideas? Here's the flyer I just received.  They will do up to $25,000 in renovations before you list your home. If you're interested, please let me know.

ATTENTION HOME OWNERS!!!

Are you putting your house on the market? Do you need a home appraisal but are worried it won’t be valued high enough? Do you need help taking those extra steps to ensure you get the most out of your home investment when it comes time to sell?

Well, a new show wants to help!

From the creators of ABC’s "Extreme Makeover: Home Edition" comes a new show that will pair you with a nationally recognized home improvement consultant who will help you make the necessary improvements to ensure that your family gets the best appraisal possible!!! 

This is an opportunity of a lifetime! Please send photos of your home, your family as well a little bit about yourself and your situation tochandra.pinto@rrstaff.com. Don’t forget to include your name, age and contact info. Send ASAP to be considered!!! 

621 N. Keystone in Burbank closed today

621 N. Keystone in Burbank closed today for $607,500.  It originally went into escrow at $615,000 but there were some needed repairs that lowered the price.  We held our breath on the appraisal but it came in to value and is now the highest price by square foot in the neighborhood. The sellers are wonderful and the buyers are, too.  It was something extremely rare -- a smooth escrow (very unusual these days).  I hope the buyers and their baby daughter will be very happy in their new house and I wish my wonderful seller clients the best of luck, too!  Thanks to Gary Mazziotti, my partner on this transaction, and the terrific buyers' agents too.

Ask the home appraiser

Have you been curious about some of the finer points of home appraisals? I have -- and although I deal with them all the time, things change.  My office recently brought in an appraiser to speak, and here are some of the more pertinent questions and answers.  Remember, these answers were given for a Realtor's perspective.  The comments in italics are mine.

• Is there a difference between independent appraisers and bank approved appraisers? How do you get to be an approved appraiser? Answer: Banks get their appraisers from appraisal management companies.  For an appraiser to get approved he has to submit a resume package like anyone else looking for a job.
• What do you do if you get what you consider an undeserved bad appraisal? Should you challenge it with comparables or demand another appraisal? Answer: It is very much better to challenge it with your own comparables.  The management company will ask the appraiser to respond and defind his values.  (Personally, I always give an appraiser comparables before the actual appraisal.)
• On second appraisals (often done if there is a value question), does the 2nd appraiser know what the 1st appraiser came in at? No.
• How much does an appraiser credit a house for on the following? Answer: extra bedroom $5-10,000; extra bathroom $5-10,000, pool $10-15,000 (except in Beverly Hills, where it's $50,000 (the extra bedroom credit is much lower than I had previously thought).
• How do you define baths? What does it have to have? Answer: 1/4 bath means sink only, 1/2 bath means sink and toilet, 3/4 bath and full bath are the same for valuation purposes and mean shower and/or tub, sink and toilet.
• Under what circumstances does a convertible den count as a bedroom, assuming there is a closet? Answer: If it has a closet it counts as a bedroom if it is larger than 80 square feet.
• When looking for comps, would an appraiser extend the radius of surrounding comparables or would the appraiser go back further than 90 days. Answer: The appraiser would extend the mile radius.  He would NOT go back more than 90 days.
• What is the value of "multiple offers" on a property to the appraiser? For the appraised value, only the closed sales figures can be used.  Actives and Pendings are important for the appraiser to note on the appraisal as a matter of interest for the big picture and to see how the neighborhood is trending.
• Can you use new construction as a comp for non-new construction? Answer: no.
• Can you use non-new construction as a comp for new construction? Answer: yes, with an adjustment for the age value.
• What about a total remodel? Answer: No, you cannot use new construction as a comparable.
• Can you count unpermitted structures, unpermitted work, or unpermitted useage or square footage in the value? Answer: No.  All the appraiser can note is that the work was done in a workman-like manner and there is no health hazard.
• What can a seller do to make the property the most appealing? Answer: Appraisers are now required to take a picture of every room, so sellers should prepare the house as if they were having it re-photographed...it must look as good as possible for the appraiser.

3031 N. Lamer and what I learned

3031 N. Lamer, Burbank has finally closed, a little over a week late. That may not sound so bad, but on the 6th I was told that it wouldn't be closing at all because of loan problems.  I really learned a lot with this one (lots of which I can't put into print here).  First, I learned that no matter how much everybody tells me that they love midcentury moderns, location is still more important.  And Burbank seems to be perceived as just...not cool enough...to move to.  I hired a publicist and even with that, couldn't get much press or really even that many showings (thanks for nothing, Curbed L.A.).

I knew this already, but appraisals are still a big issue in our current lending environment.  This home sold over the appraised price.  It went into escrow at $829k, appraised at $805k, but the buyer and seller came to an agreement and settled at $824k.  Even though the buyer was putting a lot down, the loan had to go back through "appraisal review" at the lender's -- twice, apparently.

The third thing I learned was that lenders in Texas have a hard time funding loans in California, no matter how many branches they have here.  This makes sense as the financial industry laws are different state by state.  I won't go into the gory details because I'm not even sure about how many levels of screw-up there were with the lender, but we did get help from the lender's branch manager and regional vp.  From here on, I will only recommend local lenders (see my Local Partners page on my website for four lenders that I do recommend).

Fourth, and I pretty much knew this too: some people need to get off drugs.  And others need to take more.  (I'll let you guess what category I'm in ;).)

Now for a shout-out to Lisa Gaynor and her staff at West Coast Escrow.  Lisa and her team kept their cool although it took them about six times the normal amount of work to get this closed and Lisa must have dealt with over 30 people.  That's about 25 more people than an escrow officer normally has to deal with.

So, does anybody else have to sell an architecturally significant home in an area where nobody cares about such things?  If so, I'm your Realtor!

Against the odds, 500 Amherst closed today

I represented the buyers in the purchase of 500 Amherst Dr. in Burbank, which closed today. We never thought it would. The house was on the market for $985,000 for months. The sellers had several offers, and even had it in escrow once before us. My clients bought it for $910k, which I thought was still a little high, but it appraised just fine. And we even cancelled the escrow once. But the real estate Gods apparently wanted my buyers to have this, and thanks to everybody's patience this has happened.

Architecturally, the home is a little different -- most homes in the neighborhood are traditional, not contemporary. And for such a big home (3800+ sf), it only has two bedrooms. That's right. Two. The entire upstairs is one massive master suite. And it was last redone in the early 1960's. The decor is straight out of Mad Men, complete with pinch-pleat drapes, wallpaper, a built-in high-fi cabinet, and lots of wood paneling. Nevertheless, there is something really charming about it, and the backyard is huge and gorgeous (it has drainage issues, but that's another story).

My clients are extremely creative and I look forward to seeing exactly what they do with this.

Tale of two appraisals.

It was the best of appraisals, it was the worst of appraisals. And both were on the same house. Names and addresses are left out here to protect bla bla bla.

Backstory: the house was bought at a foreclosure auction in May, fixed up, and sold to my clients in July. Our purchase price is $525k.

The first appraisal came in at $425k. The appraiser was from out of the area. We knew we were in trouble when the cover page picture was of some other house. And two comps used were on major streets, not residential streets. What happens when an appraisal comes in so low? The lender will only loan 80% of the appraised value.

The second appraisal was done two weeks later after the clients switched lenders. The appraiser used realistic comps. And the value came in at $525k. Not only will the bank loan more money on this property, but my buyer clients are relieved that the house is currently worth what they agreed to pay for it.

How can two appraisals be so different? The answer may have to do with new appraisal regulations. Banks and lenders now have to order their appraisals from pools of appraisers, rather than just calling individuals they've worked with before. And these pools are undercutting each other on price. So what you get are inexperienced appraisers doing as much as they can, as fast as they can, as cheaply as they can. And often not doing a very good job in picking comparable properties. If you're in this situation, don't be afraid to ask for an appraisal review if you think that something about the appraisal just doesn't quite smell right.