Monday, March 5, 2012
by: Mario Jauregui
Interviewee: Eliseo Herrera
Company: MC Real Estate Corp
Eliseo Herrera is a realtor broker who sells and lists properties. He helps list and sell commercial real estate, single-family homes, and bare land. He has been in the business since 2000 and definitely enjoys his line of work. He enjoys being in the business because it gives him the independence to be in and out of the office to be able to meet clients. When he has clients come into his office he always greets them with a smile, shakes their hand, and pulls out the chair for them. Before he sits back down he asks them if they would like a bottle of water before they begin and then sits down and starts off the meeting by saying their first name and uses it throughout the meeting. He is a broker who is there to treat his clients like individuals. Since he does this so well he is able to obtain all the important information that he needs from the client to satisfy their needs and perform his job extremely well. I was impressed by Mr. Herrera and wanted to ask him a few questions about his career.
What is the median range of home prices that you are seeing your clients purchase?
In this economy he states that most of the homes that he is helping others purchase are homes within the 150k to 200k prices. Many of the clients that he sees are purchasing homes that were either foreclosures or short sales.
Is it better for a person to purchase a foreclosed home or a short sale?
A person could go either way that they want to go. As long as the price and the home is what they were looking for. Generally it is harder to get a short sale because the individual who is going through the short sale with their home might end up fighting with the bank a little longer and this might cause the person who wants to purchase the home to get discouraged and then not want the home after all. Although, for people who need to get rid of their home, it is better for them to go through short sale because this means that their credit will not be affected as bad as them going through a foreclosure.
Have you seen people that have gone through a short sale be able to purchase another home during these tough economic conditions?
Yes, he has actually had a client go through a short sale with his last home about two years ago and now he was able to go back to the same neighborhood where he once lived and buy a home for less than half the price that he had purchased the first one. People that go through short sales want to get rid of their home as quick as they can for a good price and then they leave the home without destroying it. This is why they are not dinged on their credit as badly as the foreclosed people do.
What is the average home price that you are seeing more foreclosures in and short sales?
It is the rich’s turn. He is seeing many homes in the Fresno area that used to be around 400k to about 1 million dollars being foreclosed or in short sale. He states that the reason for this could be because these people that were able to afford these higher priced homes once are now the people who are losing their jobs or have to take big pay cuts because the companies they work for need to be able to afford to stay in business. He predicts that we will be seeing more and more of these homes, possibly three times more than homes that are in the 150k range, go into foreclosure or short sale. These days it is tougher to get a jumbo loan, a loan from a lender for more than $417k, because of this those people who have homes that are in a high price range have a hard time selling.
How is the commercial real estate market looking like these days?
The commercial real estate market has not entered the worst yet, but it is not far from it. Many commercial loans that were lent out during 2008 are now coming up due. Those individuals who do not have the necessary funds to pay back those loans will end up losing their commercial land or business. We will be seeing many shopping plazas close and go for sale, as well as many shopping malls that do not have the necessary amount of tenants who pay rent. Ultimately, the next trend of foreclosures will be commercial real estate because of the 5-year balloon payments that are coming due during these years.
What do you think the near future will look like for people that are just coming out of college and are looking to purchase a home or be involved in real estate somehow?
Generation Y is the new housing boom for the economy. These are the people that were born between the years of 1982 and 2002. This generation will help bring the housing market back up. The types of homes that will be sold more often will be the “Jack and Jill” set up. These are homes that have two master bedrooms and one restroom. The reason for this is because many couples are not sleeping in the same bed any longer. It could be because they have different working schedules and they have a tough time sleeping together because one person wakes up the other. Or it could even be that one of them has a sleeping disorder or a health problem and they are not able to let the other sleep at night. This new housing boom will be happening around 2016 and those who are looking to get into real estate as a career are looking at a bright future if they are willing to look at the long run. Those that are looking to purchase a home in the future, right now is a good time because of low prices and low interest rates.