The Diamond House: 6 days on the market for $525k, 23 offers and will go way over

Lately, there’s been a lot of conflicting information about the state of the L.A. housing market. Is it good, bad, slowing down? For a brief moment in July, when mortgage rates spiked seemingly overnight from the mid-3% range to mid-4%, the market did indeed panic and came to a standstill.

Instead of 30+ offers, sellers were deciding between 4-6. By September, the market was back in full swing, most notably indicated by the 23 offers received on the gorgeous Craftsman on Addison. My best guess is that this listed-at-$525k house will close between $560-575k.

The Not-So-Perfect House: Similar area, 95 days on the market for $495k, dated Mid-Century

So what’s an anxious buyer to do? An option may be to consider the not-so-perfect house. While I’m a staunch advocate for buying the home you love, the problem lies in the fact that these “diamond properties,” nearly flawless wonders that enchant and entice everyone walking through the door, are few and far in between. So what we get is the same herd of buyers moving from one perfect house to the next.

The reason for the dearth of these homes stems from the housing crash of 2007. Home values plummeted, bank lines of credit used for home improvement dried up and distraught homeowners went upside down without the ability or desire to improve their “sunk” investment. With the average occupancy of a first home being 5-7 years, 2012-13 would have been the first logical years for these owners to sell. These owners may have missed the remodeling boat, but at least they were no longer upside down.

This is where you come in. The truth is that only the diamond properties are getting double digit offers. The not-so-perfect homes are not. In the last few months I’ve finally starting seeing significant price reductions on these homes and seller concessions like paying for closings costs.

My suggestion is to be open to the not-so-perfect house. These diamond homes weren’t always so flawless. Have long term vision. If the location is perfect, you can transform almost any house into a diamond home. With skyrocketing values, you’ll likely get a line of credit and get to create your vision of a perfect home. Best of all, you won’t be battling an army of overzealous buyers.