This may initially come across as a sales pitch for our team’s real estate services. Perhaps, indirectly it is, but we are realistic enough to understand that we can’t and won’t have every prospective purchaser of Lafayette real estate working with us. Really, this is written from the perspective of simply trying to help buyers avoid the mistakes that we’ve seen happen far too often from our vantage point within the Lafayette real estate market.
As agents who list a substantial quantity of homes in Lafayette, we have an interesting vantage point on how other agents write offers, which agents are representing buyers within the market, and the quality of their representation of their clients. Suffice it to say, there is a very wide variance in the quality of representation. We also see what some of our listing clients originally paid for their home with another agent; the omissions in the purchase process relative to inspections, engineering studies, etc; and the resultant financial impact those past decisions will have on their sale.
Lafayette is a Complex Market
For a relatively small town, Lafayette is a fairly complex market that is comprised of numerous micro-markets that trade at widely varying price points from one another. To further complicate matters, Lafayette is substantially comprised of non-conforming homes. In other words, we don’t have a lot of “conforming” subdivisions where similar versions of the same home can be found elsewhere in the same neighborhood. Rather, we have a very substantial mix of homes that are non-conforming, located in charming countrified areas of town where there can be a $5M home located next to a lot that has a $1.5M home. The $5M home might be 5000 sq. ft., and the $1.5M home might be a 1200 sq. ft, but located on a beautiful, large lot. Valuation of homes within non-conforming areas is complex and requires considerable experience.
Overlay the geotechnical considerations of living in Lafayette, where we find ourselves surrounded by rolling hills… some quite steep… with Adobe soil composition in most of the valley regions. And, of course, we find ourselves in the seismically active Bay Area where buying the right home, on the right lot, while mitigating the risk geotechnical issues is quite important. In fact, there are certain areas where the Lafayette real estate is known to be higher risk due to the past history of slides in the area. The values of these homes should be significantly discounted, IF your agent understands this and is intimately familiar with Lafayette. In fact, some buyers take on these risks without even knowing that they exist.
Mistakes in Representation Can Be Costly
You can see where I might be going with this. If a buyer is represented by an agent who lacks experience, specifically in Lafayette, you can make a very unfortunate purchase decision and not realize it until either something bad happens or you try to sell. The wrong decision in agent representation can be to your financial detriment in several ways: (1) in the purchase price of your new home because you substantially overpaid relative to your particularly micro-market; (2) you purchased a home that you otherwise would not have, IF you knew the risks; (3) in the failure to have the seller address and mitigate inherent risks; and (4) in unanticipated settlement or failure in the home’s foundation that later costs you substantial dollars during your ownership experience or upon selling the home at a later date.
Our next post will zero in on what buyers should look for in competent representation.