How to buy an investment property in the Tri Valley

So you are thinking about buying an investment property and thinking about a foreclosure in Pleasanton or a short sale in Dublin. Unfortunately every time one comes up that is a deal, you get out bid or can’t get an offer in soon enough because you are too late.

For a list of foreclosures or short sales in the Tri Valley comment below.

Here is a game plan incase you don’t have one:

1. At the least get pre-approved, even if you think it will be no problem to do so. If your offer on that short sale in Dublin Ranch does not have one, the bank won’t look at your offer, sorry.

2. Know what you are looking for. 3 bedroom minimum in Pleasanton, must have garage, close to school, no pool, single level, indoor laundry… Focus on those properties you want only.

3. If it’s a rental, know neighborhood rents and be conservative. Don’t forget HOA dues. Dublin Ranch condos are a great investment with prices below $400,000 and rents above $2,000.

4. Looking at a fixer? Don’t sweat the appliances being gone or destroyed carpets and paint. Those are easy to take care of – Visit the Sears Outlet Store in San Leandro. How is the structure? How is the roof? How are the schools? Latest on Tri Valley School scores.

5. Be realistic in pricing. $400,000 condo in Dublin Ranch rents for $2,300. If you put 20% down your payments are pretty close to even cash flow. Most investors looking for a property like this will not go much higher than $400,000, so it will be hard to get it for $350,000. Think about who else might be looking at that foreclosure in Pleasanton you have an eye on.

6. Sweeten the deal. Short sale in Dublin was just secured for our buyers because the seller wanted to stay in the home and the buyer wanted a renter. We told the seller they could stay in the home. Offer Accepted! What makes your offer different from the other 7 offers written?

7. Not everyone is hurting. Even if the economy is ‘weak’ there are a lot of people with money investing in properties and flipping homes. Right now the competition for buyers is an investor who has done their homework. Have you done your homework? If you have, you will get an A in investing and make some great money from this market.

If you would like us to help you develop a plan, email us here.

For a list of foreclosures or short sales comment below.

Remember to do your homework. Here is a post covering that idea. Is Your Home Convenient.

Can You See The Bottom – Tri Valley Homes

This is not an article about why you should buy a Pleasanton home because everyone buys for different reasons. This may be a bad time for you to buy that condo in Dublin Ranch, but it may be a great time for you to buy that Danville home. This article is what we have observed from working with Tri Valley home buyers over the years.

In 2004 and 2005 the question for many tri valley home buyers and tri valley home sellers was ‘how long will this last?’ Meaning how long will prices increase. Today the question is ‘when will the bottom hit?’ And in 2007 the question was ‘Why would anyone buy a home in this market?’ In the papers and on the television the thoughts were similar. Last year you could pick up the paper and a headline would read ‘Where is the bottom of the market.’ Today I opened the paper and the headline was ‘Housing bottom coming into view.’ Real estate is always looked at in trends of month to month sales or year to year pricing. Since we are tri valley realtors we have a good look at the ‘emotional’ trend of buyers in the Pleasanton, Dublin, Livermore, Danville and San Ramon markets. As you could probably guess the trend or question we get now is ‘When should I buy a home?’ Today we have a lot of clients who want to buy a home, they just want to time is right. From the National Association of Realtors to CNBC many economists are pointing to some point in ’09 to be the bottom and a stabilization moving forward from the end of 2008. Before you say we have a bias opinion, we also see first hand the buyers in the Pleasanton, Dublin, Livermore, Danville and San Ramon markets who are waiting for the right point to purchase. Think of it like a group of runners at a start line shoulder to shoulder holding everyone else back waiting to sprint or ‘jump’ into the market. The number of people waiting is huge and once the media is in line with what those buyers at the start line want to hear or see in the data trends, the real estate market will explode. My point is this – Don’t try to time the market, you will have a hard time doing it because every markt is different, but buy a home for the reason our grandparents did! When the time is right for you, buy and hold.

Buy smart and do your homework!

20 Years of Dublin, Livermore and Pleasanton Home Sales Numbers

Median Prices of Homes in Pleasanton have obviously increased from 1988. As well as Dublin Home sales and Livermore prices.

Here are some numbers for Median Prices of Single Family Homes…

1988 Pleasanton Home in January was $189,000 (interest rate 10.38)

1991 Livermore Home in January was $200,000 (interest rate 9.64)

1999 Dublin Home in September was $320,000 (interest rate 7.82)

FAST FORWARD… May of 2008

Pleasanton Home $1,044,570

Livermore Home $518,469

Dublin Home $640,717

Here is a full report of Median Prices of Pleasanton, Dublin and Livermore Homes

Pleasanton Median Price History

Livermore Median Price History

Dublin Median Price History

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Pulling Back the Layers – Tri Valley Homes

A look at Tri Valley Homes and a look at Pleasanton Home sales are not the same as the broad Bay Area home sales. We can all agree it’s all about location. A Dublin Ranch Condo will not react in pricing the same as a Pleasanton Condo, because of location. So when a recent report says… “the largest increase in month to month sales in 20 years was reported by Data Quick on Tuesday. And Bay Area Homes increased 33 percent last month from March, compared from April ‘07 sales were down 14.2 percent so is it indicating a bottom as some are saying?” We need to dig.

Yes, numbers are up and we can agree that Pleasanton Home values will rise and the price someone paid for a Dublin Ranch Condo will go up, but when.

I believe we are at the bottom, here is why.

RENTAL MARKET
When I have a client looking for a rental I feel like it is 2004 when I chased the truck with the for sale sign posts in the back of it to see what home was going on the market. I had a Pleasanton Home up for lease at $2,300 by the time we rented it out it went for $2,450 a 7% increase. By the time we reach Spring ‘09 will a home like this be close to $3,000? Some already are. Sooner or later it costs more to rent than buy and housing prices will go up.

MULTIPLE OFFERS
Not all homes see multiple offers, but the quality homes are. Quality I will define as good price, upgraded, location. Lets not forget ‘deals’ get multiple offers and the last 2 offers I have written for one particular buyer have both been one of seven offers. Currently we are seeing some areas like the Dublin Ranch Condos not being able to appraise at final bid price. There are a lot of buyers out there, but even less quality homes.

LENDING GUIDELINES
One of the problems is the ability to get a loan. New guidelines are going to help over time and in the Tri Valley with higher than the national $220,000 median price we need it. As soon as guidelines swing the other way and loosen up, more people will be able to buy and prices will even out.

SHORT SALES & FORECLOSURES
While this is seen as a negative, remember these people need to live somewhere and rental prices are being pushed up because of these sales. Eventually people who are renting and waiting for the right time to buy will do so when the cost of buying a home and rent they pay are close. Also as soon as pricing stabelizes and even out, these current renters will jump and become buyers. They are just waiting.

NEW CONSTRUCTION
The only builders selling new homes are the ones who have had a long term plan. Sorrento in Dublin Ranch has been planned for years, but they are holding off on completing the entire project for a few years. This means there are less new homes to purchase down the road.

POPULATION
People need to live somewhere and the increase in population from the obvious local increase of kids buying homes is one reason as well as the immigration for other countries. Lets not forget, most countries have booming economies and people are coming here and buying homes. The Bay Area has for years been a draw because of good jobs too.

Overall, people will only wait so long until they say, now is the time! But when is the time? We will only know it’s the bottom once it passes us, but the above points all lead to a turning in the market and correction upward in the coming years.

Do you believe the market is here?