Perfect storm is ending
The perfect storm that has benefited homebuyers for the past two years is coming to an end. That end may come slowly, but it is coming. Or, it may come sooner than we expect. There are significant Southern California economic indicators that show an economy on the rebound:
1. The Port of Los Angeles, the nation’s busiest seaport, reported last week that exports were up more than 10% in 2010 over the previous year. The container export total even beat the record set in 2008.
2. Forty miles away in Culver City, a recently renovated mall reported that, in 2010, it saw an incredible 90% increase in visitors over 2009.
3. Locally, South Coast Plaza in Costa Mesa saw its sales from June 2009 to June 2010 go up 5.5% to $1.2 billion.
The last two items are sure signs of increasing consumer confidence, which drives our economy, which drives home sales.
This year, buyers will have to contend with higher interest rates and more competition for the better properties. The rising interest rates are all but assured. The increased number of buyers for the homes that are near or just above the county median price of $424,000 (source: HousigTracker.net), will result from an improving economy.
Valerie Torelli is the founder of Torelli Realty in Costa Mesa, which began in 1984.
Torelli has been successful, in part, because she possesses a street sense that brings buyers and sellers together. So, I asked her what are the top five features that her clients are looking for and will continue to look for in 2011.
“Above all, buyers today are looking for value,” said Torelli, who made the distinction between a low price and value. “Any idiot can sell a house that is priced right or one priced below market, but value for the price is numero uno. The buyers today are educated, wary of the market and very aware of what the inventory of homes has to offer. So a seller who is disconnected from their market does not stand a chance with these buyers.”
As hard as it may be to believe, Torelli’s next requirement is “a motivated seller who can close escrow.” But isn’t every seller motivated now?
“Buyers want a ‘real’ short sale with a ‘real’ price with a ‘real’ listing agent who is presenting the offers and not misleading the buyers with undervalued pricing in an attempt to get leads, Torelli said. “There is so much fraud now in the short-sale process and buyers want to know what is happening with the offers they are presenting.”
Torelli’s third buyer requirement is a concept that is making its way across many industries: treating buyers with respect.
“They are more informed than ever before,” said Torelli. “In many cases they are more aware then their real estate agent, making the value of an agent suspect. Buyers are asking intelligent questions and demanding integrity from those who represent the real estate industry.”
That knowledge is due in part to the Internet, which makes available data that was previously hard to find. So today and forever, buyers will continue to be empowered by increased knowledge.
Fourth, Torelli told me that “buyers mostly are looking for the long term. The questions today’s buyers are asking are more thoughtful with visions toward the future and are no longer looked at as a short term investment but a lifestyle change.”
“Finally, location is key. It will come down to the basics, a home with a great location will always be of paramount importance.”
STEVE SMITH is a Costa Mesa resident and a freelance writer. Send story ideas to smi161@aol.com.
