January 25, 2024
Jess Young
As everyone knows, real estate sales have been slower than usual the past couple of years, and the primary culprits have been the limited inventory of homes for sale and the rapid rise in interest rates and subsequent increases to mortgage rates. While the latter seems to have peaked during this cycle at over 7% for a conforming, 30-year (non-jumbo) loan, qualified buyers more recently could secure a mortgage at 6.6%. At 300 basis points or more than what loans were at the beginning of 2022, that differential is still too much for many buyers, especially first-time home buyers.
Thus, we went looking for what might appear to be a ‘normal’ or ‘average’ house sale story, because we know homes have been selling, even if the media mostly tells us that they are not. And we found one, in speaking with Jess Young, a veteran Realtor with Sonoma County Properties.
Young and colleague Charles Lunnie co-listed a single-family home on Kingwood Street in Santa Rosa. It’s just off of College Avenue in a mixed-use community of pocket neighborhoods and commercial enterprises. With an asking price of $569,000 or below the market’s medium home price, the SCP agents knew they would get a lot of interest. And they did. They hosted open houses nearly every weekend.
“The phone never stopped ringing in the 3-4 months we had the listing,” says Young.
Like many older homes, the listing had its challenges. For example, the rooms were very small and the property backed up to a commercial car wash.
Despite the activity on the listing, no offers were submitted the first couple of months. Then one came in, at $100,000 below the list price. The seller had the SCP Realtors reject that offer, but lowered the asking price. Then a second offer arrived, and this time it was $70,000 lower than the asking price. The seller countered that they would take $10,000 off the asking price, but during that process, they got a full-price offer and the agents retracted the counter offer.
The new full-price (though reduced twice) offer came with a kick; the buyers (first-time home buyers), had help from a city program to make the down payment on the loan. The sale closed, much to the delight of the seller and the listing agents.
“Without the city loan program and down payment assistance to the buyer, I’m not sure we were going to be able to close this sale,” said Young.
Visit the City of Santa Rosa’s website for more information on the program, but here is the gist of it.
“The City of Santa Rosa’s Down Payment Assistance Loan program (DPAL) provides loans up to $75,000 to qualified borrowers to use towards the purchase of their first home within the Santa Rosa city limits. This program is open to current Santa Rosa residents only and must be used towards the down payment of a home as the owner’s primary residence. The loan does not require monthly payments. When the property is sold, transferred, in some cases refinanced, or the loan has reached its 30-year term, the owner must pay back the principal amount of the loan, plus any accrued interest and fees.”
Serving Cloverdale, Graton, Healdsburg, Rohnert Park, Santa Rosa, Sebastopol, Tomales, Windsor and surrounding Sonoma County, CA areas.
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