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My sister-in-law and my brother are buying a new house and selling an old house in San Diego, North County (downsizing). The home are 10 minutes away from each other, 3 freeway exits away. I'm wondering if their realtor has failed them because they seem to be buying high and selling low, at least to me.
They own a beautiful, move-in ready home in Rancho Penasquitos, 3 car garage, 2 stories, 2600 sq ft originally built in the 80's but has been extensively upgraded with all hardwood / laminate floors, with a remodeled kitchen & master bath w/ new granite counter and cabinets, and a viking stove and high end appliances. They have panoramic private views in the backyard overlooking Carmel Mountain and Poway area.
They purchased a new house in Rancho Bernardo, 2 car garage, 1 story, 1600 sq ft house built in the 60's with beautiful golf course views. That house requires a total interior renovation as the cabinets are worn, the flooring is old and dated. They plan to spend $80k on the renovation for new kitchen, bathrooms, flooring, paint, appliances. (I'm gifting / loaning them money for the renovations - we are very close, so I'm involved peripherally).
They purchased the new house in Rancho Bernardo at $418 per sq ft, and after renovations - it will be around $488 per sq feet. The new house was sold 2 years ago to the previous owners for $100k less than what they are buying for.
The old house is being sold at $288 per sq ft. That's a huge disparity of $130 - $200 per sq feet less for the old house, even though it's only 10 minutes away and 3 freeway exits away.
Interestingly, 2 years ago, they tried to sell their old house. They entered into contract 2 years ago to sell their old house for only $31k less than the current sale price, after having it on market only 1-2 days with multiple offers. The sale didn't complete because the buyer's financing fell through, and they had second thoughts about moving at that time and decided not to sell at that time.
So I find it very odd that their old house could sell for so much less, and only appreciated $31k over 2 years (compared to the prior sales price which was extremely competitive at the time), while their new house costs so much more per sq ft, and the new house appreciated $100k - $180k over the same period of time.
They used the same realtor on the buy side and sell side. I'm wondering why the realtor didn't warn them that they were over-paying on the new house, and then the same realtor warned them that they wouldn't get much more for the old house. I don't think the realtor can have it both ways - have them over-pay for their new place, and under-sell for the old house.
I don't think they are too happy with the way things turned out. They purchased the new house first, and their realtor didn't blink an eye when they consulted the realtor when running the numbers, and their offer was the highest per sq ft in the area. Their realtor said it was a "good offer".
Now that they have been in the selling process, their realtor has turned negative, saying "$288 per sq ft is the most you'll get for this house, it may not appraise for more, yada yada yada." I think they are a little pissed but they can't change realtors at this point. Their realtor was trying to talk them down in terms of pricing, much to their surprise.
How on earth can there be such a huge disparity on the buy / sell side, with 2 homes so close to each other? The realtor certainly made their commission on these two deals, talking them up to buy the new place, and talking them down selling the old place... something doesn't right to me.
The deal on the sell side is not completely done, so there's a chance things may change. Another reason I'm inquiring.
10 minutes and 3 freeway exits can make a huge deal. Different towns, different schools, etc... I know in my area 10 minutes and three exits could mean the difference between million dollar homes and $100K homes.
You cannot compare new home to old home. You must compare new home to other homes in the exact area, and old home to other homes in that exact area. What do the comps for each house say?
10 minutes and 3 freeway exits can make a huge deal. Different towns, different schools, etc... I know in my area 10 minutes and three exits could mean the difference between million dollar homes and $100K homes.
You cannot compare new home to old home. You must compare new home to other homes in the exact area, and old home to other homes in that exact area. What do the comps for each house say?
Sorry I mis-stated. The "new home" is an old 1960's home, while the old home is a 1980's home.
Thanks for confirming that 10 minutes / 3 freeway exits can make a huge difference. That does make me feel somewhat better.
I have reached out to an appraiser to get a 2nd opinion on this.
I am not super well versed with real estate in Rancho Penasquitos, but my SIL lives in Rancho Bernardo and the price the OP's relatives are considering don't seem shocking -- moving to a more desirable area often does mean paying a significant premium.
The reasons the house they are selling is for "just" $31k more than the offer two years ago probably have a lot to do with "price compression" in areas that are not as desirable -- regardless of how "nice" you make a home in area that is served by the kinds of things buyers value (which is mostly schools, but also access to jobs, recreation, quality of life...) it is impossible to really make it more valuable.
The information that is needed to determine why Rancho Penasquitos is so much less costly probably includes the fact there are still quite a few foreclosures lingering in the market -- that really makes it hard for folks to get a fair price and I am willing to bet that is precisely why the real estate agent mentions that a higher offer might not be possible...
If you are local to the area you can probably get some some helpful info by just calling a local real estate office and not mentioning your relatives, but generally inquiring about the relative opportunity to find a potential investment situation, there can be enormous differences between communities that are literally adjacent to each other. The communities where folks are more established and did not over-extend themselves likely have NO foreclosues and the area (that might be newer...) where folks took out riskier loans and higher rates on homes that were more overpriced can be bargain priced...
I am not super well versed with real estate in Rancho Penasquitos, but my SIL lives in Rancho Bernardo and the price the OP's relatives are considering don't seem shocking -- moving to a more desirable area often does mean paying a significant premium.
The reasons the house they are selling is for "just" $31k more than the offer two years ago probably have a lot to do with "price compression" in areas that are not as desirable -- regardless of how "nice" you make a home in area that is served by the kinds of things buyers value (which is mostly schools, but also access to jobs, recreation, quality of life...) it is impossible to really make it more valuable.
The information that is needed to determine why Rancho Penasquitos is so much less costly probably includes the fact there are still quite a few foreclosures lingering in the market -- that really makes it hard for folks to get a fair price and I am willing to bet that is precisely why the real estate agent mentions that a higher offer might not be possible...
If you are local to the area you can probably get some some helpful info by just calling a local real estate office and not mentioning your relatives, but generally inquiring about the relative opportunity to find a potential investment situation, there can be enormous differences between communities that are literally adjacent to each other. The communities where folks are more established and did not over-extend themselves likely have NO foreclosues and the area (that might be newer...) where folks took out riskier loans and higher rates on homes that were more overpriced can be bargain priced...
Umm...I don't care if it's one exit and 5 minutes away. Neighborhood affects price and can vary even by BLOCK. Also, 100K in appreciation in 2 years in an expensive area sounds normal to me...
My sister-in-law and my brother are buying a new house and selling an old house in San Diego, North County (downsizing). The home are 10 minutes away from each other, 3 freeway exits away. I'm wondering if their realtor has failed them because they seem to be buying high and selling low, at least to me.
They own a beautiful, move-in ready home in Rancho Penasquitos, 3 car garage, 2 stories, 2600 sq ft originally built in the 80's but has been extensively upgraded with all hardwood / laminate floors, with a remodeled kitchen & master bath w/ new granite counter and cabinets, and a viking stove and high end appliances. They have panoramic private views in the backyard overlooking Carmel Mountain and Poway area.
They purchased a new house in Rancho Bernardo, 2 car garage, 1 story, 1600 sq ft house built in the 60's with beautiful golf course views. That house requires a total interior renovation as the cabinets are worn, the flooring is old and dated. They plan to spend $80k on the renovation for new kitchen, bathrooms, flooring, paint, appliances. (I'm gifting / loaning them money for the renovations - we are very close, so I'm involved peripherally).
They purchased the new house in Rancho Bernardo at $418 per sq ft, and after renovations - it will be around $488 per sq feet. The new house was sold 2 years ago to the previous owners for $100k less than what they are buying for.
The old house is being sold at $288 per sq ft. That's a huge disparity of $130 - $200 per sq feet less for the old house, even though it's only 10 minutes away and 3 freeway exits away.
Interestingly, 2 years ago, they tried to sell their old house. They entered into contract 2 years ago to sell their old house for only $31k less than the current sale price, after having it on market only 1-2 days with multiple offers. The sale didn't complete because the buyer's financing fell through, and they had second thoughts about moving at that time and decided not to sell at that time.
So I find it very odd that their old house could sell for so much less, and only appreciated $31k over 2 years (compared to the prior sales price which was extremely competitive at the time), while their new house costs so much more per sq ft, and the new house appreciated $100k - $180k over the same period of time.
They used the same realtor on the buy side and sell side. I'm wondering why the realtor didn't warn them that they were over-paying on the new house, and then the same realtor warned them that they wouldn't get much more for the old house. I don't think the realtor can have it both ways - have them over-pay for their new place, and under-sell for the old house.
I don't think they are too happy with the way things turned out. They purchased the new house first, and their realtor didn't blink an eye when they consulted the realtor when running the numbers, and their offer was the highest per sq ft in the area. Their realtor said it was a "good offer".
Now that they have been in the selling process, their realtor has turned negative, saying "$288 per sq ft is the most you'll get for this house, it may not appraise for more, yada yada yada." I think they are a little pissed but they can't change realtors at this point. Their realtor was trying to talk them down in terms of pricing, much to their surprise.
How on earth can there be such a huge disparity on the buy / sell side, with 2 homes so close to each other? The realtor certainly made their commission on these two deals, talking them up to buy the new place, and talking them down selling the old place... something doesn't right to me.
The deal on the sell side is not completely done, so there's a chance things may change. Another reason I'm inquiring.
Is your brother and sister-in law mentally incompetent? Why do you feel the need to intercede in their affairs?
You are getting it second hand and are asking hundreds of strangers for advice?
Am I missing something?
Is your brother and sister-in law mentally incompetent? Why do you feel the need to intercede in their affairs?
You are getting it second hand and are asking hundreds of strangers for advice?
Am I missing something?
Yes you are, if you bothered to read the thread and not repeat the question from above. The info was in my original post that you quoted, and repeated again to someone else.
Thank you for jumping in and not bothering to read the information, or offering any valuable advice in any way. How the heck you got so much reputation I'll never know.
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