Eleven offers for this Sherman Oaks condo

I listed 14115 Moorpark #202, Sherman Oaks in late March.  By the beginning of the following week, we had eleven offers.  All of them were good.  All were at least a little over the asking price.  We counter-offered on six, and opened escrow with the buyer who had the "winning" bid last week. Yes, it went substantially over the list price.  I have never had this many offers for a condo before -- but then, this is a mighty cute property and is in a great, walkable Sherman Oaks neighborhood.

Think it's easy to buy L.A. real estate with $1+ million in cash? Think again.

Not to give you home buyers out there even more reasons to be disappointed, but.  Some former clients of mine returned to town after moving to the San Francisco Bay area some years ago.  They had made cash offers on properties in Berkeley and the Oakland hills but were aced out on price each time.  It's not that they were submitting low-ball offers -- most of their offers were over asking -- but they were repeatedly beaten out by offers over $100,000+ more than asking.  The Bay Area real estate market is too crazy, they said.

It's not that bad here, I said.  I was wrong.

In the course of one week, we made three offers on properties in Studio City, Sherman Oaks, and Glendale.  All of the offers were all cash.  All were over the purchase price -- some significantly -- and all were $1.4 million or thereabouts.  Yes, million.  You'd think sellers would be crawling over themselves to take these wonderful, beaucoup-bucks cash offers, but you'd be as wrong as I was.

The first property went for significantly over the asking price for all cash.  We offered $50k over asking on the second property but seller terms were a little grab-y and it went into multiples anyway.  My buyers offered significantly over the list price, all cash, on the third property.  Plus gave the sellers a free 60-day rent back (unheard of in a normal market).  The sellers dithered.  And dithered.  And finally accepted on a Saturday afternoon.  We buttoned up the deal.  And the sellers changed their minds Sunday morning. Ugh.

My poor clients were very philosophical about all of this, and went on vacation to lick their wounds.  And in the meantime, they've decided the Bay Area is not so bad after all.

As for me, sure; these are not great experiences for a Realtor.  Yes, there's the income issue.  But also, it takes just as much work to not get an accepted offer as it does to get an accepted one. Sigh. Onward!

Rising mortgage interest rates and home sellers and buyers - what it means

By now, you've probably heard that mortgage interest rates are rising and may go up as high as ('gasp') 5% by the end of the year.  That's still historically very low, but here's how it will affect you.

If you are selling your home in Burbank, Studio City, Toluca Lake, Sherman Oaks or any other place in our region, rising rates will have a dampening effect on activity.  Some buyers will be knocked out of the market and that should "stabilize" prices a little bit.  Higher interest rates usually exert a downward pressure on prices.  That doesn't mean that you won't get multiple offers for your home if it's priced right; it just means that there may be less offers than we've been experiencing. The offers may not be quite as high, either, especially if home inventory increases. However, your home will sell if it's priced right and marketed correctly.  (See the marketing page on my website at JudyGraff.com.)

If you're a home buyer in the San Fernando Valley, all of the above will be good news for you except the interest rate part.  Yes, it will cost you more to buy a home.  But you won't have as much competition (some of my Valley home buyers wrote eight to ten offers before getting one accepted) and prices won't be rising as much.  And if inventory increases, that will have a downward effect on prices.  So keep looking.  Your house is out there.

If you're a buyer and you're currently in escrow, make sure your lender locks in your interest rate.

Caveat: some of the neighborhoods here in the Southland are immune to the effects of rising rates.  The really, really expensive high-end L.A. markets are still awash in cash, with a lot of that coming from overseas.