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Oakland Home Buying Webinar - October 4, 2012
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Oakland Home Buying Webinar - October 4, 2012

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  • 1. Home Buying 101 Webinar October 4, 2012 Oakland Follow: @RedfinSanFrancisco Like: http://www.facebook.com/RedfinFranciscoSlide 1 of 36
  • 2. A Little Bit About Who We Are Redfin is a real estate brokerage that has helped over 20,000 people buy or sell a home; 97% would refer us to a friend. ● Customers, not commissions ● Informed decisions ● The right home for the right price No obligation Get back a portion of our commissionSlide 2 of 36
  • 3. To Buy or Not to BuySlide 3 of 36
  • 4. Why You Should Buy a Home ● You have a family and need room to grow ● You expect to stay put for 5 or more years ● You want a home that is difficult to rent ● You’re handy & and ready to invest ● You’ve saved up a down paymentSlide 4 of 36
  • 5. Why You Shouldn’t Buy a Home ● You don’t have a good reason like family or schools ● You can’t afford the down payment ● You can rent for much less ● You plan on moving soon ● You’re worried about job securitySlide 5 of 36
  • 6. Market ConditionsSlide 6 of 36
  • 7. Case-Shiller: San Francisco Area v. 20-City 250.00 San Francisco 20-City Composite 200.00 150.00 100.00 50.00 0.00Slide 7 of 55
  • 8. Case-Shiller – By the Numbers San Francisco Area Up 3% year-over-year Peak was May 2006 Down 36% from peak Currently at April 2010 prices 20-City Composite Up .5% year-over-year Peak was July 2006 Down 31% from peak Currently at July 2011 pricesSlide 8 of 36
  • 9. Oakland August Stats for HousesSlide 9 of 36
  • 10. Oakland August Stats for HousesSlide 10 of 36
  • 11. Where to find data…Slide 11 of 36
  • 12. National Market Trends● Prices Soften Slightly, Still Up 3.2% Year Over Year● Inventory Down 28.1% Year Over Year ► California still falling faster than everywhere else. ► Fewer bank-owned listings for sale, and fewer conventional sales on the market. ► Homeowners can’t afford to sell with prices at or near a five-year low in most markets. ► Stabilizing home prices and low interest rates have slowed foreclosures.Slide 12 of 36
  • 13. National Market Trends ● One in Four Listings Is Under Contract in Less than 14 Days ► Over a quarter (27.8%) of all single-family houses that debuted in the first 3.5 weeks of July were off the market in under two weeks.Slide 13 of 36
  • 14. Multiple Offer Situations This occurs when inventory is down and buyer interest is up 5 Tips for Winning in a Bidding War 1. Make the competition eat your dust 2. Get pre-approved with a local lender & get underwriter approval 3. Start the conversation early 4. Write a letter & appeal to the seller 5. Know your limitsSlide 14 of 36
  • 15. What Happens After You Find a Home You Love?Slide 15 of 36
  • 16. What to Ask Any Agent ● Is this your full-time job? ● Familiar with foreclosures or short-sales? ● Where were your last five deals? ● Who else will be working with me? ● Will you show me all properties for sale? ● When am I committed to working with you? ● Has a client ever filed a complaint? ● How are you paid?Slide 16 of 36
  • 17. Traditional vs. RedfinSlide 17 of 36
  • 18. Make Sure He’s a Good Fit Click here when you decide See all deals & reviewsSlide 18 of 36
  • 19. Partners in the Process AGENT TOUR Responsible for your success COORDINATOR Writes your offer Schedules tours Handles negotiations Prepares paperwork TRANSACTION FIELD AGENT COORDINATOR Takes you to see homes Prepares paperwork Sees 50+ homes a week Works with escrowSlide 19 of 36
  • 20. Redfin’s Partner Program Partner agents are employed by other brokerages, but have teamed up with us to provide Redfin-Certified service to a wider range of customers. We’ll refer you to a partner agent when: ► A home is outside of our direct service area ► A home is below our price minimum ► We’re experiencing an unusually high customer demand We survey all partner agent clients ► All surveys are published on their Redfin page ► 97% of customers would recommend Redfin partnersSlide 20 of 36
  • 21. Open Book ● Redfin Certified Providers ● Every professional is reviewed and all reviews are shown ● Search for local: ► Inspectors ► Lenders ► Title CompaniesSlide 21 of 36
  • 22. We List Homes, Too! ● More people see your home ► Premium placement on Redfin.com ► Mobile apps target on-the-go buyers ► Professional flyers ● You’ll know it all at every step ► Email all buyers who see your home ► See how many people have viewed your home ► Advise you at every step in the processSlide 22 of 36
  • 23. MortgagesSlide 23 of 36
  • 24. Getting Pre-Approved A pre-approval letter is a letter from a bank or a lender estimating how much theyll lend you ● Establishes what you can afford & makes offer process go faster ● Good for 90 days, depending on lender ● Ask for a few different amounts ● Redfin asks that you get pre-approved before your third tour ● Similar, yet different from pre-qualification Information needed: ● W-2, two pay-stubs, tax returns, bank statementsSlide 24 of 36
  • 25. Organize Your Assets ● Get ready for the down payment ● Cash accounts (liquid funds) ● 401k, stocks, other investments ● Gift funds? (max. allowed varies) ● Move funds around earlySlide 25 of 36
  • 26. Review Your Debt ● Pull credit report, look for errors ● Figure out how much monthly income goes towards debt: 28 – 33% healthy ● Pay down credit balances to 1/3rd ● Don’t open any new lines of credit ● Don’t buy any big ticket items ● Co-borrower will need to do the sameSlide 26 of 36
  • 27. Start Shopping for Lenders Compile a list of 3-4 lenders & brokers Good sources include: ● Redfins partner lenders ● Referrals from friends, family & co-workers ● Banks or credit unions you have accounts at ● A large, national bank with an advertised rate ● Your real estate agent ● Online review sites, such as YelpSlide 27 of 36
  • 28. Local Recommended Lenders *In no way does Redfin benefit financially from recommending lenders – we just think they’re great lenders!Slide 28 of 36
  • 29. Where Are Rates Headed? Type of Loan September 20, 2012 September 13, 2012 30-Year Fixed 3.49% 3.55% 15-Year Fixed 2.77% 2.85% 5/1 ARM 2.76% 2.72% 1-Year ARM 2.61% 2.61%Slide 29 of 36
  • 30. Where Are Rates Headed?Slide 30 of 36
  • 31. Comparing Loan Estimates ● Gather loan estimates ► A minimum of three, more is better ► These aren’t final numbers, but within a few thousand dollars ► Compare similar loans Program (FHA, conventional) Timeframe (same day) ● Compare costs side-by-side ► Discount & origination points ► Interest rates ► Insurance premiums (FHA, PMI) ► APR (interest rates + fees + points + PMI)Slide 31 of 36
  • 32. Make Your Decision ● When possible, get a loan commitment ● Make alternative funds liquid (401k, stock) Good news! Loan payments are made in arrears, so your first loan payment won’t be for two months.Slide 32 of 36
  • 33. Next Steps • Check out our agents and their reviews • Study the inventory and houses in your areas • Go out on Tour with us, no obligation • Ask a lot of questions and see a lot of houses • Email me: kyle.crabb@redfin.com • Check the events page for upcoming classes • Go back to work!Slide 33 of 36