Be sure to keep your central heating and air conditioning system healthy...

While the temperature on average Sacramento summer days tends to be between the upper-80's and low-90's, a couple times each summer we usually see the weather extend above 100 degrees for a several days or a week straight. Those days I usually crank up the air conditioning, binge watch something on Netflix, head to the movies, or do other indoor activities. Or if you are Nugget, my sweet mini aussie, you might lay directly on the HVAC floor vent to cool down. The LAST thing anyone wants during that hot week is to turn on the air conditioner and find that it is not working.

HVAC maintenance is really important. I highly recommend having your unit(s) professionally serviced at least one per year...and in the meantime there are a couple of DIY things you can do as well.

First, be sure to change your HVAC filter at least every other month -- maybe more often if you notice the filter looks dirty. As more particles are caught in the filter, the more clogged it becomes. If it becomes difficult for the unit to suck air through the filter, you unnecessarily burden your system. Not only will that cost you more in monthly utility bills, but it makes the system work harder and will possibly be more prone to failure. Filters are relatively inexpensive, and I tend to keep a few on hand and replace them as often as I need to.

Second, if you have an outdoor unit as I do - it is important to keep the top and sides free from debris. I have lots of leaves in my backyard and they tend to fall into that top exposed fan area. I use a shop vac to clean them out. Also, try not to stack things on top of them...it's best to allow unrestricted air flow.

Third, whether your interior vents are in the floor or ceiling, occasionally take the vent covers off and clean them out. The vents in my house are on the floor, and they get dusty, dog hair and other small debris gets caught in them, etc. Again we take the shop vac and clean them out and wipe off the vent covers.

Doing these little maintenance items can help make sure that the air flows nicely...

Mortgage interest rates - still really low...

A buyer client asked me the other day if I thought the 4.0% mortgage interest rate she was quoted was a good rate. YES. Not only is that a good rate for today, that is an amazing rate given where interest rates have been in the past. For those of you who do not remember when rates were higher than 5.0%, let me refresh your memory.

When I bought my first home in 1998, my interest rate was 7.125%. And for that time, THAT was an amazing interest rate. I remember my mom expressing how jealous she was because the interest rate my parents had on their home was substantially higher.

I recently stumbled across this old newspaper ad from 1985 touting 11.5% as an amazing interest rate! That's correct -- today's interest rates are about 1/3 of that from 1985. And let's not forget that for the mid-1980's 11.5% really was a good rate since they peaked in the high teens earlier in the decade.

What do low interest rates mean for housing affordability? Let's break it down based on monthly payment. Here is monthly loan principal and interest for a 30-year amortization based on a few different rates:

$300,000 loan at 4.0% - $1,432.25
$300,000 loan at 4.5% - $1,520.06
$300,000 loan at 5.0% - $1,610.46
$300,000 loan at 6.0% - $1,798.65
$300,000 loan at 7.0% - $1,995.91
$300,000 loan at 8.0% - $2,201.29

Interest rates matter...and right now they are awesome.

Search for your next home here.

3-D Virtual Tours -- an awesome way to draw attention to Sacramento listings from out of area buyers!

Last month, the Wall Street Journal reported that Sacramento is one of the hottest real estate markets in the country right now. Multiple offers. Homes selling in just a few days. Homes selling for more than their listing prices. Why is this happening? The heat of our local Sacramento real estate market is due to many factors, and among them is buyer demand from bay area residents looking to purchase more affordable homes here in Sacramento.

Home prices in Sacramento are, in many cases, less than half of the median home prices in the bay area. For example, according to the California Association of Realtors, the median home price in San Francisco County in May 2017 is $1,501,680. Santa Clara County's median home price is $1,200,000. Alameda County's median home price is $862,000.

Sacramento County's median home price for May 2017 is....wait for it....$342,100. I don't think you need to be an expert at math to realize this is a screaming deal by comparison. So it is not surprising that people who can work from home, or who are willing to commute, or find comparable employment here in Sacramento would prefer to pay our far lower home prices.

So why do I mention all this? Since many buyers are conducting their home searches remotely from a hundred miles away, 3-D virtual tours have become a KEY piece of my marketing strategy for my listings. I have gotten LOTS of attention from out-of-town buyers who can virtually walk through my listings...so if you are thinking about selling your Sacramento home, and your Realtor is not doing professional photography and 3-D tours, you are probably working with the wrong agent. You will miss a large chunk of the buyers in the Sacramento market by not giving them adequate tools to virtually explore your home listing.

On average, a Sacramento home sells for 100% of its listing price...but be sure to focus on the micro market that applies to you!

I like to meet with new clients at my office first before we ever go look at property to review the process, and among the topics we discuss are the market dynamics for whatever area and price range of interest. Often, my clients have preconceptions about the market that developed as a result of media coverage, advice from a family member, or a friend's past real estate experience.

So I may hear things like "my dad told me to make lowball offers on every home because sellers over-price homes assuming they will negotiate the price" or "my friend got a house for 10% less than the asking price" or "I saw on the news that every home is in a bidding war." Well...everyone has an opinion or a past experience. I let current data speak for itself.

Let me tell you first, that our Sacramento real estate market is a tricky beast. It is full of micro-markets, and no two areas have the same market dynamics. It is very important to look at the market as a whole, and then focus in on the micro market that applies.

So as an example, this first table is a look at the entire Sacramento real estate market as a whole with regard to average days on market, and the average listing price to selling price ratio. On average, in Sacramento in May 2017, a single family home in Sacramento County sold in 20 days on the market for 100% of its listing price.

Clearly, these are averages - so for every home that sold in 5 days for 5% over its listing price, there is another home balancing out the average that sold in 35 days for 5% less. You get the idea.

But then compare that data to that for Folsom homes under $500,000 in this second chart. In May 2017, a single family home in Folsom sold in 12 days for 101% of its listing price. Those may not seem like big differences, but those are significant! That means that buyers have to be prepared to act faster when a property hits the market, and more often than not be prepared to offer an amount over the listing price.

Even the Folsom table is still probably too broad, and if there is a specific neighborhood or tract that interests you, be sure to specifically examine those sales and trends. It is important for both buyers and sellers to arm themselves with data. And not just any data -- but the correct and most current data.

Quoted in an article in Sactown Magazine about listing strategies in the current Sacramento real estate market...

In this month's Sactown Magazine I was quoted extensively about the Sacramento real estate market. In many areas and price ranges, the market conditions favor sellers. As such, it is imperative when listing a property to employ strategies that will maximize exposure to buyers, maximize disclosure to potential buyers, and maximize net proceeds...and minimize surprises.

Surprises are expensive, and they may cost a seller big-time when conditions are discovered mid-transaction. I wrote a blog post about disclosure versus discovery a couple years ago. You might think -- "oh but this is a seller's market so why would I need to do anything like that?"

The very best advice I can give a home seller to maximize selling price and net proceeds is to obtain pre-listing inspections for the property, and disclose the reports to potential buyers in advance, BEFORE responding to any offers. With our current Sacramento real estate market favoring sellers, it is most advantageous for sellers to disclose as much as possible in advance -- when the home goes on the market -- so that buyers may make informed purchasing decisions while they are still in competition with other buyers. Often times, with the heat of the market, while competing with other buyers, many buyers will offer to buy the property as-is with full knowledge of the findings of the reports.

That is the key...while buyers are still competing with other buyers...because often once the seller accepts an offer and the house is marked pending, most buyers move on and get excited about other property. Alternatively, if sellers do not disclose inspection reports up front, and then buyers complete their own inspections a few weeks into the transaction and discover issues not previously disclosed, this provides the opportunity for a secondary negotiation which often leads to price concessions or seller-paid repairs.

Sellers -- to maximize your net proceeds: disclose, disclose, disclose. I provide my sellers with a few key pre-listing inspection reports as a part of my listing services at no added expense (in addition to many other things). I can not tell you how many times these reports have earned or saved my clients tens of thousands of dollars.

New Listing - 2042 58th Street, Sacramento, CA 95817

Adorable 3 bedroom, 2 bathroom, 1,098sf remodeled home near Tahoe Park and Elmhurst! You will love the spacious open layout, remodeled kitchen with granite counters and stainless appliances, wood floors, big bedrooms, large master suite with large walk-in closet. Dual pane windows, shutters, central heat and air, composition roof. Large landscaped backyard, detached garage/bonus room. Close to shopping, schools, parks, freeways, SMUD, Sac State, UC Davis Medical Center, and more! Don't wait! Offered at $599,000. Tenant occupied -- DO NOT DISTURB TENANT. For more information visit 2042 58th Street, Sacramento, CA 95817.

New Listing - 3536 Riojo Way, Rancho Cordova, CA 95670

Elegant Stone Creek 3 bedroom + den, 2 bathroom, 1,612sf home on large corner lot in Rancho Cordova! You will love the spacious open layout, vaulted ceilings, separate living and family rooms, laminate flooring, remodeled kitchen with granite counters, full backsplash, remote-controlled undercabinet lighting, and stainless appliances. Large master suite, dual sinks, multiple closets, doors lead to backyard. Ceiling fans and recessed lighting throughout. Den/possible 4th bedroom off front entry area. Exterior recently re-stucco'd, covered patio, and newer fencing. Short distance to parks, schools, bike trails, recreation, shopping, and more! Offered at $369,900. Don't wait! For more photos and virtual 3D tour, visit 3536 Riojo Way, Rancho Cordova, CA 95670.

Do not skip your "final walk through" before closing escrow on your new home...

I have written in the past about the importance of the final walk-through to verify the condition of a property right before closing, and this last weekend was a good reminder why it is so critical for buyers to take one last look at the house after the seller moves out and before closing.

Paragraph 15 of the California Residential Purchase Agreement addresses the final verification of property condition...this is not a contingency of the sale (meaning, the buyer can't cancel the contract), however it gives the buyer the right to verify the condition of the property within 5 calendar days of closing. So if the seller has agreed to make repairs, the buyer can use this as an opportunity to visually verify the repairs are done. Or that the appliances that are included in the sale are indeed still in the property. Or that the seller has been maintaining the property in substantially the same condition as when the buyer's offer was initially agreed upon.

I could post lots of photos from my final walk-through with my buyers this last weekend, but this one is probably the most telling. The carpet is a creamy white color, and this particular room was filled with rugs and dining room furniture before the seller moved out. Now that the property is vacant, we can see that the carpet is horribly stained. This condition was not disclosed.

Aside from that, the home was pretty filthy, there were some holes in walls that were not there before, there was a large previously concealed stain on the vinyl flooring in the master bathroom, all three of the flat screen television brackets were removed and holes not patched, texture not touched up, etc. Again, thankfully we discovered these conditions BEFORE closing the transaction. While the final walk-through is not a contingency of the sale, the seller should turn over the property to the buyer in satisfactory condition.

How was this situation remedied? The seller did not want to delay closing, and did not want to do any additional work or repairs. We negotiated a $1,000 credit to the buyers to offset the costs of these newly discovered issues.

Had we not done a final walk-through and discovered this before closing, it would have been very difficult to negotiate any sort of compensation for the buyer for the condition of the house after closing, short to taking the seller to small claims court.