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One Myth regarding buying probate homes in Santa Clara County is they present an opportunity to get a screaming hot deal!
Perhaps once upon a time, a long time ago, people could get a screaming HOT DEAL purchasing a probate home.
Kathleen Daniels became a licensed real estate agent in January 2003. At the time of writing this post, she has been working full-time in real estate for 18 years and counting.
Her first Santa Clara County probate listing was in April 2005. It sold for $30,000 over the list price.
Throughout the years, even fire-damaged and teardown homes sell if not over the list price, remarkably close to the list price. In many cases, multiple offers are received.
Probate Homes | Probate Real Estate in 2020
The address of the probate homes in these scenarios is intentionally omitted.
The three scenarios outlined below are not properties listed by Kathleen Daniels, Broker-Owner of NeedProbateHelp.com. However, Kathleen did make a rare exception and represented a buyer on one of the homes.
Santa Clara County Probate Homes
Scenario One: This home is a 3-bedroom, 2.5-bathroom, 1,821 square feet of living space, situated on an approximately 10,500 square foot lot, built in the year 1956 (64 years old).
It was marketed as a fixer or tear-down to build a dream home. The upside potential is the 10,000+ square foot lot.
Kathleen walked through the home and can attest to the condition. The 64-year-old home was in original condition, worn down, and ready for a teardown or complete makeover.
The title to the home was held in a family grantor trust. Apparently, when the person who lived in the home had died, it was time to sell the home. The home was sold by the Santa Clara County Public Guardian’s Office and is subject to court confirmation. All offers were required to be delivered in a sealed envelope accompanied by a cashier’s check representing 10% of the offer price.
Below is the data reported in the Multiple Listing Service (“MLS”).
List Date: October 2020
List Price: $1,295,000
Sale Date: November 30, 2020 (under contract)
Escrow Closed: December 31, 2020
Sale Price: $2,120,000
Financing: Conventional
# of Offers: 69
Seems unbelievable – doesn’t it? Data like this may make an unsuspecting buyer wonder.
Was the list price low – below Market?
Based on market data in the MLS, the list price was in alignment with a similar home in the same “tear down” condition, recently sold in close proximity to this home.
This is an example of supply and demand. The showings were non-stop and the sale took place during the 2020 COVID-19 Pandemic.
What we know from experience is that public perception is that screaming hot deals can be made on probate homes, especially homes in poor condition. What the public may not realize is that many other people perceive the same and the competition for homes in Santa Clara County probate is fierce. The data does not lie.
Sixty-nine (69) offers on this home that sold $825,000 above the list price! The exceptional things about the home in the eyes of buyers:
- location
- schools
- lot size
- opportunity
There is no doubt in our mind that the winner of the bidding war on this home is very happy to have it and does not care about getting a hot deal. They care about the opportunity to get what they wanted and were prepared to pay a premium price for it.
Scenario Two: This home is a 3-bedroom, 2-bathroom, 1,702 square feet of living space, situated on an approximately 16,500 square foot lot, built in the year 1960 (60 years old). It too was marketed as a teardown – one heck of a wreck. The upside potential is the 16,500-square-foot lot.
The title to the home was held in a family trust. The home was sold by the successor trustee of a trust.
Rinse and repeat with the non-stop showings during the COVID-19 Pandemic as in scenario one.
Offers were submitted directly to the listing agent. Delivery in a sealed envelope accompanied by a cashier’s check representing 10% of the offer price was not required.
Was the list price low – below Market?
Based on market data in the MLS, the list price was in alignment with a similar home in the same “tear down” condition, recently sold in close proximity to this home.
This is another example of supply and demand. The showings were non-stop during the COVID-19 Pandemic.
Below is the data reported in the Multiple Listing Service (“MLS”).
List Date: November 2020
List Price: $1,795,000
Sale Date: November 24, 2020 (under contract after 7 days on the market)
Escrow Closed: December 24, 2020
Sale Price: $2,450,000
Financing: Conventional
# of Offers: 60
Sixty (60) offers on this home that sold $655,000 above the list price! The same exceptional things about the home in the eyes of buyers:
- location
- schools
- lot size
- opportunity
Seems unbelievable – doesn’t it? Data like this may make an unsuspecting buyer wonder.
Santa Clara County Probate Homes | Home Scenario Three:
This home is a 2-bedroom, 1 bathroom, 667 square feet of living space, situated on an approximately 7,700 square foot lot, built in the year 1930 (90 years old). The home is being sold by the County of Santa Clara subject to court confirmation but not over-bid All offers were required to be delivered in a sealed envelope accompanied by a cashier’s check representing 10% of the offer price.
Was the list price low – below Market?
The home is in tear-down condition.
Below is the data as reported in the Multiple Listing Service (“MLS”).
List Date: December 2020
List Price: $800,000
Sale Date: January 2021 (under contract)
Close of Escrow: February 16, 2021
Sale Price: $1,300,000
Financing: Private Financing
# of Offers: 21
Perhaps this kind of sales data is why so many investors are reaching out to probate real estate agents, like Kathleen Daniels, seeking “off-market” properties and hoping to buy without any competition. As we explain to all investors seeking such an opportunity, all properties are listed for sale on the MLS. We work for the sellers, and our job is to get the highest and best price for all of our clients. The only way to accomplish the highest and best price is to let buyers compete for the opportunity.
Certified Probate Real Estate Specialist
Potential buyers for the home scenario three property contacted us requesting that we represent them on the purchase.
Unfortunately, we are unable to help everyone who requests our help and expertise. We are a boutique-like brokerage specializing in probate real estate and are committed to providing exceptional service to all of our clients.
Service is our priority over and above high-volume sales. We commit to working with potential clients based on the number of clients we are serving at the time our help is requested. We know that we truly serve no one by taking on more business than we can manage, and manage well.
Our primary focus in probate real estate is listing probate homes for sale. It is our business practice to represent sellers exclusively. That means, as a general practice, we do not represent buyers on our probate listings.
We are often contacted by people who want us to represent them as the buyer on our listings. The minds of many buyers believe they are doing us a favor because we could potentially make more money by representing both the seller and the buyer. That is more truth than myth. However, our commitment is to the Santa Clara County probate sellers who are the executor, administrator, or successor trustee of a trust. We ensure our actions as the listing agent do not present any conflicts of interest.
If you need help selling probate homes and want multiple offers with a screaming hot sale price, give us a call. We are here to help.