In the spring of 2008, I helped a Marine family purchase a home in Temecula. Over Memorial Day weekend, the wife flew out from the East Coast with a mission to purchase their California base of operations. Armed with a massive spreadsheet and two cups of coffee, I picked her up at her hotel on Friday morning. For the next three days, we stormed through every four-bedroom house in her price range. She was a quick decider and didn’t linger inside any homes she didn’t like. When she vetoed one candidate, I’d cross it off the list and load our next destination into my Garmin GPS. As we drove around for hours we talked about spouses, kids, Ohio State, Australian wines, where we’re stopping for lunch, and occasionally real estate. Each afternoon I’d return home down the 15 with my head spinning with the carousel of homes from that day’s tour. Finally on Sunday, our home search ended at a cute one-story home and our offer was accepted shortly after the wife boarded her plane back east. Never again would I show so many listings to a buyer in such a condensed period of time. To this day, I still tell clients of the legend of “Mrs. Sixty Homes.”
Mrs. Sixty Homes had the luxury of shopping for houses at the dawn of the bank-owned market. The Great Recession had unleashed a wave of short sales and foreclosures and Southwest Riverside County was flooded with distressed properties. Borrowers, especially those with negative amortization mortgages, were losing their homes and banks started to acquire quite a bit of real estate. You may recall newspaper pictures of a sad neighborhood with an array of “for sale” signs and an accompanying article about how the Millers are watering their neighbor’s brown lawn because Wachovia won’t follow the HOA rules. As more homeowners defaulted on mortgages, the bank-owned inventory grew, creating a bounty of choices for buyers.
That is certainly not the market we’re in today. If Mrs. Sixty Homes were home shopping today, she wouldn’t need a 3-day weekend to see all the houses available in her price range; we could probably knock that out during her lunch break. While it seems like REALTORS® have been talking about low inventory for years, in the past few months listings have become ridiculously, if not comically, scarce. I won’t bore you with any statistics; just picture your Econ 101 professor erasing her original supply line and redrawing it much further to the left. It’s Christmas time and everyone is after the last Cabbage Patch Doll, Tickle-Me-Elmo, Furby, Tamagotchi, Frozen Elsa Talking Glow Doll, or PlayStation 5. And like rapid pack parents clawing after the latest and greatest gift for their children, the home buying process has certainly intensified.
For example, the seemingly simple act of scheduling a showing for a buyer used to be so much easier. Now it’s an emotional roller coaster just to find out if we’re going to be able to get in and see a home. As soon as a new listing hits the market , the calls for showings flood in like teenagers speed-dialing a radio station for free concert tickets. (I understand many of you may be too young to understand that reference; there was a time when telephones were used to make phone calls.) Some listings have automated online scheduling and as I eagerly input requests I feel like I’m trying to land a beach camping reservation or a tee time at Bethpage Black. When I get that e-mail confirming our appointment, I celebrate like my buyer just landed their dream home. Seriously? What have we come to? Right at this moment, you might have more luck booking a vaccine appointment than a time to see a 3-bedroom house in Carlsbad.
Sellers used to be thrilled if a potential buyer was coming to see their house the first day it hit the market. They would excitedly ready the house by turning on all their lights, choosing some mellow tunes on DIRECTV, and taking the fresh batch of cookies out of the oven. You could schedule a showing with the bravado and casualness of the cable company, “Hey Mr. Seller – we’ll be there sometime between noon and 6pm on Wednesday.” Not anymore. There are no more generous scheduling windows. On Saturday and Sunday, houses are being shown every fifteen minutes sunup to sundown. You and your buyers will be at 126 Martingale precisely at 3:15 pm or you’re not seeing it. And with showings operating with the efficiency of the Tokyo rail system, you better plan out your route of homes with commensurate precision. I’m aggregating data from SigAlert, Waze, Doppler Radar, and Google Maps just to find a route between the three houses we want to see on Sunday. According to my calculations, if we make 62.5% of the traffic lights, we should be okay.
Recently, I showed a house that literally had been listed for four hours. When I turned into the cul-de-sac to meet my client, I couldn’t believe the crowd of agents and buyers that had already assembled. The house had been on the market for four hours. Four hours!?!?! I assumed perhaps that a popular food truck had tweeted out their daily lunch location and it just happened to be in the same neighborhood. But there were no $3 Korean short-rib tacos on this day, just another million dollar, 1500 square-foot house waiting for its fifty offers to be made. So I stood in the walkway leading up to the front door, queued behind one agent and ahead of another. Masked up and six feet apart, the only thing missing were the stickers on the ground reminding you to stay socially distanced. I joked with an agent behind me that it “feels like waiting in line at the grocery store.” We shared a laugh and she replied, “Yes, but at the grocery store you can actually buy what you’re shopping for.” Ouch.
The challenge now is the painful musical chairs math of too little supply and too much demand. We have some buyers who just closed on a home purchase, we’ll call them Mr. & Mrs. Eleven Homes. In a span of a few months, the three of us have basically looked everywhere only to find 11 homes that fit their very general criteria over a broad geographic area. We’re not talking about overly-picky buyers here, they had simple requirements like “four walls,” “garage,” and if possible it might be nice to have “doors with door knobs.” You would think $850,000 would be enough to accommodate their modest requests, but apparently a good portion of the San Diego population had the same housing needs. Each weekend, we would see the 1 or 2 new homes that the market had to offer them in their price range. After Sundays of rejection, we finally were able to secure an accepted contract.
While these buyers are not a military couple, they certainly “earned their stripes” in the course of battling through their own personal bidding wars. Mrs. Sixty Homes stormed in and out of town for the 3-day Temecula Blitz; Mr. & Mrs. Eleven Homes fought a drawn-out land campaign, The March to Tierrasanta. In the end, both buyers were successful under drastically different market conditions. The common denominator in both searches was a well-designed battle plan and the dedication to execute it. Sure, these buyers weren’t being asked “to secure a hill or advance on a beachhead,” but they “handled the truth.” I don’t eat breakfast or show houses in neighborhoods near 4000 Cubans who are trained to kill me, but I do know what the market could really use is A Few Good Homes.
