San Diego Housing Market News and Analysis

Real estate transactions in CA are very complex. Many listing brokers will not do a deal with an unrepresented buyer. There's just too much legal risk involved.

Are you looking to share in the transaction commission or do you just not like to deal with realtors or lawyers?

Lawyers I don't mind dealing with AFTER I have an accepted offer. With the advent of the Internet, buyers' agents are basically useless middlepeople.

And don't give me the "transactions in CA are so complex..." - people go directly to a selling broker for NYC apartments, and those transactions are annoying and fraught with pitfalls to say the least.

http://coopandcondo.com/component/flexic...

I think in every question, especially in sue-happy CA... One needs to (instead of asking why?) ask, what do you think sue-happy people would do if you didn't...We are a litigious type in So Cal afterall.

spdrun, you're sounding a lot like some other characters that have come and gone.. Like maxmax33, alex_angel, biggovernmentisgood, etc,etc,etc... Look, if you're just looking for positive affirmation of what you already have made up your mind to.. Then by all means, anyone here isn't going to convince you otherwise. Go right ahead, because even if anyone did have any noteworthy "advice" for you, if it doesn't jive with what you are already thinking, it doesn't really matter anyway. You're coming here for presume advice that's one thing. But if you're coming in thinking, "well all this shit is easy because been there, done that"..Then by all means, you really don't need any help at all.

I'm not doubting your ability nor do I necessarily question your intent. But let's just leave it at a lot of people appear to have been living in CA a lot longer than you have. But by all means, do what you think makes the best sense of you.

Why don't you go try and write a few offers yourself, and see where it takes you. You ask why? Folks tell you why. You don't believe/understand why, and you think well it's not like that in other states. Fine. Well, it's what it is out here.

By all means, if you want to bypass all these games, find a means not to buy at retail. If you have the connections to do that, you're gonna get a smoking deal, and you don't have to waste your time with all this crap. Unfortunately, most of us that are looking/buying don't have those connections.

One thing that is very certain. In SD, RE investment properties have picked up significantly since end of 2011...In many many scenarios it's really crazy.. For an investment property at a given listed price, often times we're seeing multiple counter cash offers, and in some scenarios few grand above asking. It's at a point that in many scenarios, we submit offers without even looking first, because when the deal appear smoking it goes contingent by the next day. Cash offer won't necessarily give you an edge especially if you're thinking about something $200k or less. Because apparently there are plenty of people who make full offering price cash offers...Last time one property had 8 counter offers, and I believe 6 of them were all cash offers. That's what you're up against. And seriously, the likelihood of you representing yourself versus everyone else who is probably appropriately represented doesn't look very promising because if I were a listing agent, I'd want to deal with someone I know who has a reputation for closing... But that's just me.

Like I said, it's not like detroit here, in which you have troves of homes that folks are begging you to buy. If something has been on the market for a long time, it's most likely because it's overpriced and the seller doesn't want to budge (yet).

flu is right... CA is a very litigious state. That's a big part of the complexity of our RE transactions.

If you want to shop on your own, go with a broker like Redfin. They will help you with all the required disclosures and guide you thru the process without any of the typical selling games.

I'm not against using a broker. I'm actually working with one, though I have NOT signed any exclusive. I just find the situation with needing a broker bizarre. If the cost of doing business is that you need to deal with another middleperson, then it is what it is.

But considering that my offer on my current home was a short e-mail outlining price, pre-approval situation, down payment, and stating "AS IS", I'm entitled to find it all a little odd.

The other thing that I find weird is how financial information on condos is given. Where I bought, if you ask the selling broker nicely, they'll e-mail you a PDF or fax it to you (for free) within a day or two.

In CA, it seems like condo financials are a big secret. Need an accepted offer, blah, blah, blah, need to pay a fee for copying, yadda, yadda. How can you possibly make a sane offer if you don't know the financial health of the condo board?

Yes, you can gather quite a bit from maintenance fees, FHA/VA approvals, the condition of the complex, and just from talking to people. But why not put that info out front to make everyone's life a bit easier?

Blame it on our legal system. It is what it is.

Btw... I'm a commercial real estate broker. In 99% of my transactions, I'm a 'dual agent.'

I think a lot of selling agents will probably treat someone without their own broker as a window shopper. Really, if they give you grief I'd just say something vague about how you haven't found the right representation yet. I imagine they mostly just want to know you are serious and not wasting their time.

Yeah, but I encountered more than that. Including one broker who basically said "how do I know that you won't rob me at the property?" over the phone (nevermind that I wanted to meet at their office first).

My answer was: "how do I know that you won't mug ME?"

This seemed to be a recurring theme -- I've noticed a lot more worry about crime and muggings in SD than on the East Coast. Strangely enough, violent crime stats are actually lower for SD than say NYC or Boston.

Buying and selling real estate is different in every state. Particularly with residential real estate, agents are used to dealing with inexperienced buyers and sellers. If you've been through the process in CA before, and are an experienced and concientious buyer, you should have no problem navigating the process without an agent representing you. Agents get paid for the service they provide, sometimes it's their experience, sometimes it's just hand holding that's required. If you don't think you need that service, negotiate that savings accordingly and do it yourself.

Because that would be too easy and no one could nickel and dime you.. :)

In all seriousness, yes it would nice if this was easily accessible if you not represented before escrow. Just doesn't happen

You can ask the HOA management company directly, they would probably give you a copy, but you probably have to pay a cost for that. You could try to ask the seller/selling agent for a copy, but unless you're the only buyer (which chances are you are not), they would put you on the bottom of the priority list, because until you enter escrow, it's extra work that probably they don't want to waste time unless you're the one going to be entering escrow. And once you enter escrow, provided you didn't waive standard contingencies, you have ample time to back out of the deal no questions asked..And frankly, there's probably plenty of people that don't think about HOA underfunding, financial health of HOA prior to a purchase...people who aren't nearly as careful as you are (when imho they should be).

You'll find a lot of interesting things about California, and specifically SoCal.

No, just that I'm paranoid... Rest of the the people on this board are normal...

You could try to ask the seller/selling agent for a copy, but unless you're the only buyer (which chances are you are not), they would put you on the bottom of the priority list, because until you enter escrow, it's extra work that probably they don't want to waste time unless you're the one going to be entering escrow.

Not much extra work. If they were properly prepared, the work would largely consist of attaching a PDF to an e-mail and sending. Clicky-sendy, takes 15 seconds.

And speaking of extra work, wouldn't negotiating a sale only to have a strong buyer run screaming due to poor financials be MORE extra work?!?

an HOA company probably wants to charge $25 for that clicky-sendy. And a listing agent might not want to clicky -sendy to every bidder until they are in escrow because there are other fish that aren't asking for the clicky-sendy. Call it laziness that they can get away with. Note: not all agents would do this probably. There are some probably that would get it for you. BUT, it depends how popular the property is I guess.

Not really. You would be an extra bidder on the place..You might not be the only strong buyer...But you might be the only strong buyer that cares about the HOA financial health... (Me, I do too)... But just saying.....

I find it hard to believe that people would buy a condo (unless it's under $25k or something) without doing due diligence on the financials, pending lawsuits, etc. But if it does happen, that's cool, just not my thing.

Not a masochist here :)

Just ask folks that bought a condo convert if they thought about the potential HOA underfunding.... What? Folks really think that there wouldn't be a problem there?

Pending lawsuits are interesting. Because if you have a loan contigency, most likely it would be flagged then.

To be fair....There are people on this board that would swear that condos or any attached community is a horrible "investment" as a blanket statement too, for your aforementioned reasons....

Piggies on this board, as we are so called, like to think we're smarter then the average people...Well, with the exception of maybe me...I like to be pretend I'm dumber than most people. Because then I surprise myself and surprise everyone else when I exceed expectations, and then I can feel good about myself.

HOA docs are $200 to $500 here and no one wants to pay in advance until they know they have a firm contract. They also need to be current so if you order them and some time passes before the transaction is set to close they may have to be re-ordered for additional expense. If you want them in advance as a buyer you most likely will have to pay for them yourself. Where CA is different is the protections for the buyer are likely unparalleled across the country. Deposits are more refundable here than anywhere else I have ever heard. Once in escrow you can review the docs and if you dont like what you see you can cancel and get 100% of your deposit back. Simple as that.

You seem to be one of those buyers I run into from time to time who think they know it all and are smarter than any real estate agent so I wont bother to tell you anything more. You already know it all.

HOA docs are $200 to $500 here and no one wants to pay in advance until they know they have a firm contract.

The basic documents -- recent meeting minutes and annual financial statements -- are not provided to unit owners for free on an annual basis? If it's a short sale, one would assume that the unit owner could provide them to the listing broker. But perhaps I'm wrong.

You seem to be one of those buyers I run into from time to time who think they know it all and are smarter than any real estate agent so I wont bother to tell you anything more. You already know it all.

No - I'm asking questions and attempting to educate myself. And I admit that I do find some things odd. No need to be a d'bag to someone whom you don't even know, bigshot.

Nice! You from Jersey? I'm from Jersey. Its a whole nother world out here and it aint easy. Learn for yourself or get good help. Real estate is a full contact sport here and the waters are full of blood thirsty sharks. Some very bright and some not so bright. Enjoy the ride.

FWIW I have closed about 100 short sale listings and not a single one was to a buyer who came direct to me. I have been approached numerous times and tried to work with some seemingly good buyers but they never work out. I try to avoid buyers like that. Would much rather deal with a buyer that comes in with an agent they are loyal to than one who approaches me directly because I know they are doing the same thing over and over again. BUyers like that are a dime a dozen around here so be prepared to get in line with the rest of them just like you.

Yep, from NJ originally.

It does seem like a full-contact sport -- the problem is that players seem to be a lot worse organized than on the other coast, as well as being not very bright in some cases and generally less straightforward.

All of that and more. It really is the wild west out here in RE.

BTW, its funny that I can just tell when someone's from Jersey like me. What exit? Exit 4 here.

Up north. I guess exit 14 would apply, but quite a bit west of that at first, then east across a large river :)

Got it. Went to school up North then worked in one of those two tall buildings that used to be across that river.

I was also thinking NJ.
IIRC NJ mandates that you have an attorney for closing. I have friends/family in NJ and Philly. sdr is originally from Jersey.

Both NJ and NY require attorneys. I have less of a problem working with one just before closing (after I satisfy myself of everything) than dealing with a buyer broker for months on end!

Atty fee is actually cheap as compared to a broker commission. Yeah, yeah, seller pays, but everything eventually gets passed to the buyer!

Don't know about NY, but NJ doesn't actually require an attorney. In order to protect themselves, NJ agents always put a requirement for "attorney review" in the offer/acceptance. It's of very little value. The review is basically a rubber stamp (how much repeat business is an attorney going to get if s/he nixes the deal?) and the attorney's pay is so low (about $1000 per closing) that all the work gets done by paralegals (who may or may not be qualified). When we were trying to close, the opposing attorney added in the requirement for a "quantitative three part pump test." After googling that phrase and getting ZERO hits we asked repeatedly for the requirement to be removed or explained and got no reply. Since this meaningless requirement seemed like a built in method of getting out of the contract, we told the buyer no deal which led to them having to get a different lawyer, more $$$ for them, etc.

The bottom line is: only way you get a real attorney review anywhere is for each party to pay by the hour rather than a flat fee - we ended up paying about $5000 but saving ourselves a little over twice that much, so it was worth it.

You are comparing apples and oranges. In NJ/NY which use attorneys there are still agents on each side. IN CA the attorney is comparable to the escrow company which is cheaper and less adversarial than an attorney.

You are comparing apples and oranges. In NJ/NY which use attorneys there are still agents on each side.

For sale by owner is relatively common, as are buyers approaching the seller's agent directly and not having a broker of their own. In CA, agents looked at me like I had three eyes when I approached them directly.

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Even across the river in PA I've seen a lot more FSBO and owner-auctions than out here. I think it's a cultural thing. I've got one friend who's helped her family auction off 5 or 6 places in the Philly metro area (on both sides of the river), and another friend who almost bought from a guy who was selling his art district row house FSBO. It just didn't seem as unusual.