Most California real estate Purchase Agreements (CAR or PRDS contracts) are also escrow instructions, that give authority to the escrow company to transfer title when all terms of the Purchase Agreement are met i.e. loan documents are properly signed; all funds are in; Federal or state statutory disclosures such as FIRPTA and Environmental disclosures are properly signed and delivered; the grant deed is properly signed, notarized and recorded; etc.

In northern California, by custom, escrow and title companies are generally the same company, while they are generally different entities in southern California.

Homesellers in California are already familiar with escrow, but homebuyers may not be, particularly if they are relocating from out of state, where closings are sometimes handled by attorneys and all parties “sit down together at the closing table” – this does not happen in California because of escrow procedures.

The California Department of Real Estate has published a Consumers Guide about the escrow process.

Escrow helps protect the parties agains fraud and guides homebuyers and home sellers through the process of transferring clear title to real estate.

The California Department of Corporations scrupulously regulates licensed escrow companies.  Each licensee is required by law to be a member of the Escrow Agents’ Fidelity Corporation, which provides fidelity coverage for member trust accounts in the amount of $5 million.  This fidelity bond guarantees that, in the event of theft of trust accounts, consumer funds are protected.

Escrow processing times are not always exactly the same as stated in the Purchase Agreement if there are complicating conditions that need to be resolved first.

Selection of the Escrow Company is often, but not always made by the home seller or their agent that orders the Preliminary Title Report. Call me if you need a referral to a Realtor or other real estate professional to help you through the process.

Rick Bonetti | APR Referral Network | 408-857-8800 | DRE #01237009

I love interactive maps and potential homebuyers can get lots of important information online at the official Los Gatos City website about property they are considering purchasing.  You can search by street address or assessors parcel number and get maps showing topography, zoning, general plan designation, buildings, lot size and more – even street sweeping schedules!  Check it out.

(PS: You have to used Internet Explorer and download a MapGuide Viewer).

Alain Pinel has been adding new offices during these difficult times, because now more than ever, consumers realize they need the most professional, competent and experienced Realtor they can find. Real estate transactions today are not easy and there are legal land-mines to be avoided, whether you are a home buyer or a home seller. This is not just the situation caused by short sales or foreclosures, but also for normal sales, because the financing landscape is constantly changing.

In recent years, prior to the economic downturn, many inexperienced people got a real estate license, although most completed only a few transactions each year. Like many fields 10-20% of real estate agents account for 80-90% of the business. Everyone knows a real estate agent, and many are either friends or family. The temptation to use a part time agent with the expectation of receiving a rebate of a portion of their commission has often backfired when the inexperienced agent is unsuccessfully in securing the property or closing the transaction.

Larger real estate companies have a brand to maintain and are seen by the unscrupulous as having deeper pockets, so training of their agents and setting high standards of best practice are of utmost importance. Alain Pinel Realtors has a reputation of being a boutique brokerage, often dealing will more expensive properties. We have weekly sales meeting to review legal matters, financing, changing technology, etc. to keep us top in our field. Setting standards and levels of expected performance are key.

A couple of times very recently I have retold this story of my experience when I decided to join Alain Pinel Realtors 10 years ago: After an enjoyable interview with the President of APR and the mutual decision that it would be a good fit for us to join forces, I was asked by the President if there were anything they could do for me. I responded that I was going on a listing presentation that evening and needing a package of forms that APR used. Upon going to the cupboard where the listing packages were normally stored and finding none there, the President said “we will get one for you right away.” We shook hands and 10 minutes later I received a call on my cell phone with the President saying “Mr. Bonetti, where may I have that listing package delivered to you?” The bar was set as to what my expected level of service was to be; I have never forgotten that eloquent lesson!

Don’t get me wrong. I do think the individual agent is very important to the consumer too. This is why I blog – primarily for the benefit of those who have been referred to me so they will know me even better and feel comfortable that they have made the right choice of whom to represent their interests in a real estate transaction. Having to regularly express my views in this very public way makes me careful to think things through and to be as accurate and fair as I can be.

Occasionally I come into contact with a really exceptional agent not affiliated with a top brokerage and occasionally I see agents within our own brokerage who do not make me proud to be associated with them, but in my experience both are exceptions rather than the rule. Incidentally, my definition of top brokerage is more akin to their reputation for having professional, competent agents and the productivity per agent rather than size of the brokerage in terms of number of agents. We agents know when we are working with pros or not; when we are not, we end up doing their job as well as ours to get it done right.

This topic of whether the agent or the brokerage is more important to the consumer has recently been debated in the March 24, 2010 blog post of Phoenix, Arizona Realtor friend Jay Thompson, who has so far received 244 comments on his post! My conclusion out of all that was written is that unfortunately many brokerages throughout the country are not great brands deserving of good reputations, but those that are will attract the best agents – for those brokerages who pursue excellence, both the company brand and the agent matter to the consumer.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE #01237009

5073 Shady               Listed at $899,000       Sold for $970,000       13 offers
10607 Glenview          Listed at $1,099,888    Sold for ~$1,150,000  17 offers
21330 Columbus         Listed at $1,298,000    Sold for ~$1,330,000  7 offers
10250 Mann              Listed at $895,000       Sold for $1,050,000  30 offers
883 S. Tantau           Listed at $685,000       Sold for $740,000       9 offers
76 Arcadia                Listed at $768,000       Sold for ~$840,000     27 offers

Note:   This information is supplied by APR agent Mark Wong; sales prices are not confirmed!

Two situations are prompting homebuyers to want to make simultaneous offers on multiple properties: 1) a hot market with multiple offers, and 2) a short sale where it may take a bank a long time to respond to an offer.

Buyers need to be aware that if they persuade some real estate agent to write simultaneous offers on multiple properties with the intent to cancel one of them during a contingency period, they may be subject to damages in favor of the seller, because of implied covenant of good faith and fair dealing. That’s why I will not engage in such practice as a Realtor on behalf of my home buyer clients and I will try to screen out such buyers when I represent home sellers.

If an offer to purchase real estate has a time limit for seller to respond and that time has expired, then a buyer may* have an out. If a buyer’s offer has expired, in order for a signed and delivered purchase contract to be valid, it should also have a counter signed by seller and buyer, acknowledging an extension of date of acceptance.

* A good real estate resource for legal matters is the California Association of Realtors legal website. This blog post is not intended to give specific legal advice, just general information to alert you to issues of importance; if you have an accepted contract and you find yourself as a buyer or seller in such a situation, you should contact an attorney.
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Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE #01237009

Inventory of homes for sale in Saratoga, CA 95070 is climbing, but is still a low 86 detached and 11 attached homes.  Last week 21 detached homes were added to the inventory including 3 homes where unfortunately the transaction fell through (TFT).  Four attached homes were added to the market of available homes for sale in Saratoga.

There were 6 new pending detached sales in Saratoga (including one high priced home on Cuvilly that went into contract last year) and 1 attached home.

Only one detached home on Kosich Ct. closed escrow at $1,160,000.

Go to my website www.RickBonetti.com for detailed information.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE # 01237009

In the early 1990′s Alain Pinel Realtors was a pioneer in implementing new internet applications for local real estate and they have just introduced their latest ” killer” application: www.Open.APR.com    This website now gets a feed from the MLS database that shows open houses with maps, a street view and a route plotting via Google Maps.  You can even include all available homes for sale on a map search (not just open houses) an plot a route to drive by.

Try it out.  Don’t miss the real time market report.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE #01237009

As we have been discussing all along, rates are going up and most likely soon so it would be in homebuyers best interest to get their deals done sooner than later.

PMA/Wells Fargo is currently running a purchase rate special on all fixed rate conforming and high balance conforming fixed rate loans which should greatly benefit homebuyers.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE # 01237009

All but one of the sales was priced less than $2 million.  Included in the group were homes on Sobey Road, Oak Place, Viewoak Drive, Wolcot Way, Titus Ave., Sea Gull Way, Radoyka Rd., Martha Ave., McFarland Ave. and Via Roncole.

Included in them are two homes that have been on the market over 300 days plus two more that have been on the market over 100 days.  This underscores the strength of demand with a current low of 79 detached homes on the market .

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE #01237009

The question if get asked most frequently is “How’s the real estate market?”  It used to be that everyone read the newspapers and got their somewhat distorted news from the headlines; now people get their news online and from multiple sources.

I hope I have earned the right for you to turn to SaratogaVoice.com when you want a balanced perspective on what’ss really happening in homes for sale in Silicon Valley, particularly in the west valley communities of Saratoga, Los Gatos, Monte Sereno, Campbell and surrounding San Jose.

I could tell you about the 100 shopper groups we had at a Saratoga open house in the Golden Triangle the weekend before last and the multiple offers we had.  I could also point to the positive news today about the consumer confidence or that Case-Schiller says that home prices are rising in 14 metropolitan areas.  But, I also need to tell you that because real estate is so localized and fragmented that one cannot truly speak accurately in generalities about what the market is doing – every neighborhood is different.

Let me start by writing about the economic environment we still find ourselves in (the good and the bad) and make some predictions for their impact on real estate in Silicon Valley in 2010:

•    The Economy – we are technically out of a recession with 2 quarters of positive GNP growth and into a mild and slow recovery, but as we all know, unemployment is still high, which will continue to be a problem throughout 2010.  The economy is still fragile.
•    The stock market, which had phenomenal recovery during 2009 will have a 10% adjustment in value early in 2010 before it rebounds to 11,000.
•    Corporate Profits are up due to downsizing.
•    Unemployment is actually worse than the numbers indicate, because many jobs lost will not be replaced, due to globalization. It will take longer for those unemployed to find work ant those that do find jobs will likely be at income levels 20% below what they were making before.
•   Mortgage rates are very low and expected to remain relatively stable in 2010 with a slight uptick of ½-1%.  There is a current window of opportunity now!
•   Retail Sales have recently been good at both ends of the spectrum (Walmart to Nordstrom).
•  Corporate capital outlays for equipment have been positive.
•    The Federal deficit will drag down recovery, with $500 billion/year interest on our debt.
•   The value of the dollar has declined precipitously in the last three years as the Fed has not supported it, but printed money instead.
•    Commodity values are up relative to the declining dollar.
•    Politics – 2010 will be a watershed year politically with an ugly battle between those in favor of unrestrained free market capitalism and those seeking more security of a “hybrid” government- controlled economy.  Uncertainty will limit risky business investments until corporations know the rules of the game.
•    Real Estate will be very different than the old model of the past.  It is now very fragmented – in terms of the players, market dynamics and geographic diversity.
•    Sellers now include more banks, distressed situations and investors as well as traditional sellers.
•    Buyers in some areas now include investment funds, foreign investors as well as traditional family buyers.
•    Real Estate Investors – will continue to be important part of the market in the low end because rental properties actually cash flow positive as well as have future appreciation potential.
•    Appraisals will continue to be a problem, even if there are multiple offers.  Buyers will have to come up with more cash if properties do not appraise due to 90 day past history, and some home sales will not stick.
•    Residential financing, although improving in 2010, will continue to be a big issue in getting deals closed.  A niche market opportunity will be for astute buyers to closely follow homes with pending sales, whose deal does not hold together through the initial contingency period.
•   Refinancing will be problematic for owners who have 5 year ARM’s coming due in neighborhoods where values have dropped.  This will cause a shift from owner-occupied to renter-occupied in some neighborhoods where owners have not choice but to default on their loan, but do not want to leave the neighborhood because of schools.
•   Banks – have dominion over many lower priced submarkets, now controlling both release of inventory they own and terms for buyers.
•   REO - purchases from banks will be influenced in 2010 by bulk sales to big investment funds from the east coast.
•    Commercial real estate – will be different too with vacancies going up and rents going down.  As much as 20% of apartments will go into default in 2010 too.  Funds, as buyers of groups of buildings will be a greater influence in 2010.
•   The low end of the home market will continue to see a firming up of prices as REO inventory is sold to multiple bidders.
. The middle residential market, up to $1.5 million in Silicon Valley, will be a sleeper market that comes alive in 2010, but buyers will still be looking for value, so sellers must be flexible to make a deal.
•    The higher-value residential market, from $2-5 million will still suffer as prices continue to erode 5-15%.  Inability of upper end buyers to get loans as well as sparse 2010 corporate bonuses will put many buyers on hold.
•    The ultra luxury residential market, above $5 million will have more sellers than buyers, who will not make such a discretionary purchase unless the property is rare or exactly what they want.
•    Home values – for luxury Silicon Valley homes purchased at the 2006 peak will soften to 2002-2003 levels and in some cases to their1997-98 level.

If you really want to know about what’s happening in real estate in the specific neighborhoods you are interested in, send me an email and I will let you know what I think.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800 | DRE #01237009