10 Questions to Ask the Condo Board
Realtor.org suggests 10 questions to ask the condo board before you consider buying. In the process you will learn how quickly they respond and how well organized they are to requests. Here are the 10 questions:
"1. What percentage of units is owner-occupied? What percentage is tenant-occupied? Generally, the higher the percentage of owner-occupied units, the more marketable the units will be at resale.
"2. What covenants, bylaws, and restrictions govern the property? What grandfather clauses are in place? You may find, for instance, that those who buy a property after a certain date can’t rent out their units, but buyers who bought earlier can. Ask for a copy of the bylaws to determine if you can live within them. And have an attorney review property docs, including the master deed, for you.
"3. How much does the association keep in reserve? How is that money being invested?
"4. Are association assessments keeping pace with the annual rate of inflation? Smart boards raise assessments a certain percentage each year to build reserves to fund future repairs. To determine if the assessment is reasonable, compare the rate to others in the area.
"5. What does and doesn’t the assessment cover—common area maintenance, recreational facilities, trash collection, snow removal?
"6. What special assessments have been mandated in the past five years? How much was each owner responsible for? Some special assessments are unavoidable. But repeated, expensive assessments could be a red flag about the condition of the building or the board’s fiscal policy.
"7. How much turnover occurs in the building?
"8. Is the project in litigation? If the builders or homeowners are involved in a lawsuit, reserves can be depleted quickly.
"9. Is the developer reputable? Find out what other projects the developer has built and visit one if you can. Ask residents about their perceptions. Request an engineer’s report for developments that have been reconverted from other uses to determine what shape the building is in. If the roof, windows, and bricks aren’t in good repair, they become your problem once you buy.
"10. Are multiple associations involved in the property? In very large developments, umbrella associations, as well as the smaller association into which you’re buying, may require separate assessments."
- NATIONAL ASSOCIATION OF REALTORS®
TRI Coldwell Banker San Francisco real estate statistics - this week
Our office at
TRI Coldwell Banker at 1699 Van Ness in San Francisco is one of the premier offices in the City. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.
As you can see from the numbers below (which are 2 weeks combined due to Thanksgiving) that sales are continuing to do well in our office, even though listings are down. Again, this indicates that buyers are being represented. With pending sales outpacing listings, it won't be long before inventories shrink, and we begin to see more and more competition between buyers. So far there seems to be no holiday slowdown. Perhaps people are buying themselves homes for Christmas?
11/29/06
4 new listings (average listing price $1,173,500)
20 ratified sales (pending) (average ratified price $1,193,211)
25 closed sales (sold) (average closed price $1,488,676)
2 reduced (average reduced price $2,167,500)
- Mick Orton
Focus on San Francisco Neighborhoods - Fisherman's Warf
Fisherman's Warf as described on the
SFResidence neighborhood guide:
From
Wikipedia, "Fisherman's Wharf... Roughly speaking it encompasses the northern waterfront area of San Francisco from Ghirardelli Square or Van Ness Street east to Pier 35 or Kearny Street. It is mainly a tourist attraction, known for being the location of Pier 39, San Francisco Maritime National Historical Park, Ghirardelli Square, Ripley's Believe it or Not, the Musée Mécanique, ferry rides to Alcatraz and restaurants that serve seafood, most notably dungeness crab. Transportation to Fisherman's Wharf can be an attraction of itself, the F Market runs through the area, the Powell-Hyde cable car lines runs to Aquatic Park, at the edge of Fisherman's Wharf, and the Powell-Mason cable car line runs a few blocks away. Other popular areas in San Francisco, such as Chinatown, Lombard Street and North Beach are all located in proximity to Fisherman's Wharf."
SFGate says, "All San Franciscans love to hate Fisherman's Wharf. Content never to visit the area, they complain of the tacky shops selling cheap souvenirs, the "novelty" museums whose novelty has long worn off and busloads of tourists blocking the view to Alcatraz." Read
more.
For more information on other neighborhoods and street maps visit our
website.
- Mick Orton
Previous Neighborhoods:Chinatown - Bernal Heights - Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
Mortgage Weekly Update - Last Week in Review - Rates remain unchanged
Foster Weeks does a
weekly mortgage update.
===================================
"...Despite all the buying and selling in the malls - the financial markets saw very little action last week, and was far from busy for Bonds and home loan rates. The absence of news and thinly staffed trading desks brought very little activity, with home loan rates unchanged for the week overall.
"...Prices have been relatively stable and have shown little movement for the month of November. But bond prices are near the top of their recent range, so a hotter than expected read on inflation will spell trouble for home loan rates."...
read on...
- Foster Weeks
San Francisco Real Estate Market Update for 11/13 - 11/19/06
Avram Goldman, President and COO of Coldwell Banker, San Francisco Bay Area said in his latest weekly report: "Hope everyone had their fill of turkey, pumpkin pie, and all the other family favorites. Thanksgiving is one of my favorite holidays--a time to be with family and friends and give thanks for all the abundance and great lives we live. Our homes are the filled with delicious memories past and present. We, as Realtors, help our clients create these wonderful memories. We are fortunate to have found such a rewarding profession.
"Back to the holiday market. Yes, it is like years past, as people prepare for Thanksgiving, sales activity does slow, but doesn’t stop. Open house activity with few exceptions is energetic. The Burlingame office reported one open home with over 100 buyers through and several others with 50-100 groups. The buyers are out there, they are just taking their time in finding the right home (value= correct market price+market preparedness).
"We are still seeing multiple offers, however in fewer markets. San Francisco, parts of San Mateo and northern Santa Clara counties have the majority of these transactions. Declining inventories are beginning to have an impact on the market as sellers who are frustrated with their homes not selling after many months are taking their listings off the market. This combined with fewer listings coming on the market are driving listing inventories down. This trend is shown in that 75% of our offices reported decreasing inventories and none of our offices increased. San Francisco leads the pact as their inventories begin to dip below the 3 month level and is the force behind the city having more multiple offers than any other Bay Area market place. Other markets like Burlingame and Palo Alto are experiencing the same effect. As inventories reduce, buyers will have fewer choices and this may create a greater sense of urgency.
"Those sellers that have a need to sell are more open to realistic pricing and suggestions on how to prepare their home for sale. It has taken nearly a year of a correcting market to create a sense of a new reality. This is a positive sign as our market heads toward equilibrium. Unfortunately the media continues to over-exaggerate the state of the market. Several so-called experts predicting doom and gloom. This is par for the course, as many of them have been prognosticating about the bubble for more than 4 years. The market has finally slowed as compared to the go-go years of 2004 and 2005, but nowhere near the hard hit markets of the early 80’s and 90’s. We will not see the double digit appreciation of the last several years; however we will not see a steep fall off of prices. A few markets will continue to appreciate (in single digits), some will stay flat and a few will lose some of the appreciation of past markets.
"As stated in a previous report our open sales in October were down 14% from last year. That is a significant drop from a Bay Area wide average of 22% off in sales for the first 9 months of the year. If November follows that trend this could be what some economists have called the “soft landing”.
"A number of offices are seeing steady activity as buyers are looking for the Holiday gift of a home. Activity should pick up from now until mid-December with a typical slowing toward the holidays. Interest rates appear to be stable---still at historic lows. However, there may be a chance they could drop a bit lower if the economy begins to slow. Bottom line is the Bay Area is still one of the most desirable places to live in the world, our local economy is still creating jobs and demand is still active. All these factors bode well for a healthy balanced market----one where both buyers and sellers are on equal footing with each having to give a little.
"Here are the numbers for the week of Nov. 13th-19th: 7 offices reported steady inventories and 21had decreasing---3 offices showed increasing activity, 15 steady and 10 decreasing."
- Avram Goldman* For an e-mail alert when this report is updated, send a note to info@SFResidence.com with "weekly market report" in the subject line.
Focus on San Francisco Neighborhoods - Chinatown
Chinatown as described on the
SFResidence neighborhood guide:
Nestled between Nob Hill, the Financial District and North Beach you can find Chinatown.It is like being in a different country without ever leaving San Francisco.
SFGate does a great job of highlighting the features of this quaint neighborhood.
Other highlights on this page include:
Sights and Culture
Shopping
Restaurants
NightlifeFor more information on other neighborhoods and street maps visit our
website.
- Mick Orton
Bernal Heights - Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
High cost of reverse mortgages keeps owners away
On November 13, MarketWatch published a great article explaining how reverse mortgages could be the answer for retirees who have a lot of equity in their home and want to use that money to live on without having to sell their home outright. Although reverse mortages are expensive right now, as they become more well known, the competition could bring the price down.
Read the article
here.
We also published a series on "How to pull money out of a property without selling it". Read the
3 articles.
- Mick Orton
Luxury home values hit record highs in three California markets - And San Francisco is one of them!
It is truly a time for giving thanks. We are fortunate to live in a beautiful and prosperous area of the country. While economies in many other areas of the United States are being hurt by the housing slowdown, California's markets still seem to be thriving in the metropolitan areas.
After all this talk about the housing bubble, it is nice to see some news to the contrary for a change. Although the marketing times continue to be about 40-60 days in many cases, prices seem to be holding relatively well, with a few exceptions. Yesterday, the California Association of Realtors issued this report that luxury home values in three areas continue to rise... and
San Francisco is one of them!
The California Association of Realtors report says, "The value of high-end homes in Los Angeles, San Francisco, and San Diego posted record highs in the third quarter of 2006, according to the First Republic Prestige Home Index™, which tracks homes valued at more than $1 million in key California markets. Despite the record highs, rising inventories and longer sales cycles kept luxury home price appreciation to single digits in all three markets. In Los Angeles, which previously experienced 14 consecutive quarters of double-digit, year-over-year price appreciation, luxury home values increased 4.4 percent to $2.37 million."
"The values of luxury homes in San Diego and San Francisco also recorded modest gains last quarter, rising 5.4 percent and 4 percent, respectively. According to the index, the average luxury home in San Francisco is now valued at a record $2.96 million, while the average luxury home value in San Diego is $2.18 million."
Read the
First Republic Prestige Home Index™ report
here.
- Mick Orton
National Association of Realtors says, "Pending Home Sales Indicate Steady Market in Coming Months"
According to a November 1 report, home sales are expected to hold steady in the months ahead. Here's what the report said:
"Home sales are expected to hold fairly steady in the months ahead, according to the latest reading on pending home sales published by the National Association of Realtors®.
"The Pending Home Sales Index,* based on contracts signed in September, slipped 1.1 percent to a level of 109.1, following a 4.5 percent gain in August, but remains 13.6 percent below September 2005."
Read the rest of the article
here.
- Realtor.org
Three Tax Mistakes Real Estate Investors Make
Diane Kennedy is the author of the Rich Dad book, "Loopholes of the Rich: How the Rich Legally Make More Money and Pay Less Tax", has a
website dedicated to the ever changing tax laws and how to take advantage of them.
Here is an excerpt from her latest e-mail newsletter.
"Here are the top 3 tax mistakes that I've seen over the years. In each case the mistake can be traced back to a failure to understand a crucial element of investing.
- Failure to understand what TYPE of real estate investor you are. Are you a dealer, developer, professional or investor?
- Failure to understand WHEN you bought or sold a property. With creative real estate financing and investing this can be tricky, and not as straightforward as you think.
- Failure to MAXIMIZE the tax benefits of real estate. The loopholes are out there – but if you don't use them, or use the wrong type of structure to hold your assets, you can lose out on perhaps the most powerful real estate benefit of all - the tax savings!
Understanding what you're doing (and why it matters) is the subject of this week's What's Hot."
- Diane kennedy
San Francisco Real Estate Market Update for 11/6 - 11/12/06
Avram Goldman, President and COO of Coldwell Banker, San Francisco Bay Area said in his latest weekly report: "The market for the week of Nov. 6th-12th is like the title of Richie Havens’ first album—'Mixed Bag'.
"Open home activity has slowed in about half of our areas and still active in the other half. San Francisco and San Mateo counties are still seeing numerous multiple offer transactions with few exceptions---only Half Moon Bay, Palo Alto Midtown and Woodside did not have multiple offers. In San Francisco Lakeside office, of the 16 closed escrows—10 went over full price, 2 at full price and 4 went under list price. This is more the exception rather than the rule for the Bay Area, but it does show that San Francisco is the strongest of our market areas.
"On the Monterey Peninsula the most affordable areas of Seaside and Marina are the slowest. This is also true of a many markets in the East Bay and Sonoma county. Inventories in these price ranges are larger than in the others.
"We are seeing more bottom feeders----those buyers that are going in well under asking price and hoping for a desperate seller. This is potentially a very positive sign. In past correcting markets this usually indicates that we are in the bottom of the trough.
"Price reductions are eliciting offers. In some cases when a seller reduces to market price, they are receiving multiple offers. Patience is a key for sellers. It is taking longer to garner an offer. Once there is an offer it is taking time to negotiate between buyer and seller. This is indicative of a balanced market, the kind of market harkening back to 1996 and 1997.
"We are observing the market gearing down as we approach the holidays. There is one consistent trend we have been noticing for several weeks and that is shrinking inventories. This trend is Bay Area wide. Fewer listings are coming on the market and a number of sellers who do not have an immediate motivation for selling are taking their homes off the market. This will have a positive impact on the supply/demand ratio over time. If this direction continues, it will create a greater sense of urgency among buyers. That is why now is an advantageous time for buyers---lowest interest rates in the last 10 months, good supply of inventory to choose from and the ability to negotiate with sellers.
"Here are the numbers for the week: 3 offices reported increasing inventories, 10 steady and 18 decreasing---- 5 offices showed increasing sales activity, 15 steady and 11 decreasing.
"Have a wonderful and warm Thanksgiving. We have so much to be grateful for."
- Avram Goldman* For an e-mail alert when this report is updated, send a note to info@SFResidence.com with "weekly market report" in the subject line.
Focus on San Francisco Neighborhoods - Bernal Heights
Bernal Heights as described on the
SFGate neighborhood guide:
"Many San Franciscans never travel to Bernal Heights, located as it is at the southern edge of the Mission valley, served by only a few city bus lines and perched atop a steep hill, to boot. Those who do wander up the incline may be surprised by this quaint urban village that seems forgotten by time. The main shopping strip of Cortland Avenue is populated by small markets, cafés, fruit stands and barber shops, and the residential streets are a cluster of diminutive bungalows and community gardens. However, Bernal Heights bears the influence of city sophistication, with trendy boutiques and innovative restaurants scattered among its homely storefronts. Newcomers may also be startled by the mostly unheralded views that unfold at their feet, especially on the northern side of the hill."
Read the rest of the article
here.
Other highlights on this page include:
For more information on other neighborhoods and street maps visit our website.
- Mick Orton
Previous Neighborhoods:
Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
Converting 2 unit building to single family residence in San Francisco
A reader asks: Is it possible to convert a 2 unit building into a single family? Related question: What about a 2 unit condominium?
Our reply:It is very difficult to convert a 2 unit building into a single family. San Francisco politics is predisposed to tenants and not reducing the housing stock by any means. However, if the property was once a single family home and no tenants were displaced you might have a chance at the conversion. I would definitely consult with a lawyer who specializes in Planning and Building department issues. By paying for a consultation you could at least get an idea if your situation is feasible and if it is worth the time and effort necessary when you try to do any changes in occupancy in San Francisco.
If the building is 2 flats over a basement and garage, another possibility is to convert the top two floors into a single family and put the 2nd unit in the basement (or area behind the garage). Of course you have to be careful of the size of the units. The City does not always allow you to replace a 2 bedroom unit with a studio apartment. The 2nd unit usually needs to be a similar size to the previously existing unit.
I had a 2 unit building in
Noe Valley,
one unit on each floor and a garage underneath. I demolished that property and built a 2 story "house" in the place of the 2 apartments, then made the 2nd unit a large studio with a kitchen and bath downstairs that could also be used with the 2 story unit if the new owner wanted to do so. The buyer is using it as a single family with the studio as a family room. The architect was very good about the design so that it could be used either way.
If you want to see pictures of that property go to our
website and look at sold properties-- the address is 946-948 Elizabeth Street.
If the property is a condominium I would guess that your chances are even less to get it officially designated as a single family. What some people do is use the property as a single family (convert the kitchen into a wet bar or just have an extra kitchen) but retain the 2 unit status so that when they sell it the option for separate units is still possible, thus making it more desirable.
- Janis Stone
Time for a fall home checkup
Every year it is a good idea to do a home inspection for leaks, cracks and other blemishes that could cause you problems down the road. Here is a PDF checklist you can use to help you do the job.
To save to your hard drive, right click on this
link and choose "Save Target as". We hope you will find it useful. It may also be found on our website on the
Service Links page.
- Janis Stone
Best value when remodeling a vintage home in San Francisco
A reader asks:
We are thinking about doing a remodel on our vintage home. In reality the whole place needs to be updated, but we have heard some things are better to remodel, especially when considering resale value. We probably won't sell for a few years, so where is the best place to spend our money to give us the greatest value?
Our reply:Please refer to our July 15
article.
- Janis Stone
Focus on San Francisco Neighborhoods - The Marina
The Marina as described on the
SFResidence neighborhood guide:
"
Marina - Cow Hollow In the 1800's vegetable gardens and dairy farms in Cow Hollow feed the citizens of the then perceived remote city near by, San Francisco. Close by was the underwater soon to be land filled district that housed the 1915 Panama Pacific Exposition. A magnificent structure, the Palace of Fine Arts, designed by Bernard Maybeck stands today. Filled with many Mediterranean-style flats and apartments, the once sleepy commercial street Chestnut St. is now the busy commercial thoroughfare on which many small restaurants, old deli's, upscale retail stores such as Pottery Barn preside. The Marina greens give way to kite flying, volleyball games, endless dog walkers, a nest where many of the privileged can dock their sailboats at the St. Francis Yacht Club and breathtaking views of the Golden Gate Bridge and Marin County."
The San Francisco Chronicle describes
The Marina as, "The story of San Francisco's Marina District is the story of land and water repeatedly and dramatically altered by nature and by human development.
"Eight thousand years ago, American Indians lived on the dunes and near the tidal marshlands that today are the sites of apartment buildings, luxurious homes and some of the city's trendiest shops and restaurants. When the Spanish arrived here in 1776 and established the Presidio -- on the Marina's western border -- the marshlands looked pretty much the same as they would over a century later, in 1906, when the city of San Francisco was shaken and then burned by its first devastating earthquake and the resulting fire."
Read the rest of the article
here.
Other highlights on this page include:
For more information on other neighborhoods and street maps visit our
website.
- Mick Orton
Previous Neighborhoods:Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
TRI Coldwell Banker San Francisco real estate statistics - this week
Our office at
TRI Coldwell Banker at 1699 Van Ness in San Francisco is one of the premier offices in the City. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.
Once again the new listings are few. Most of the pending sales come from our agents representing buyers. It will be interesting to see what the sales figures look like in 2 weeks when meetings resume after Thanksgiving. We should begin to see the holiday slowdown.
11/15/06
4 new listings (average listing price $1,659,500)
11 ratified sales (pending) (average ratified price $1,461,727 )
10 closed sales (sold) (average closed price $1,196,450)
0 reduced
- Mick Orton
Defining TIC traps
A reader asks:I have heard of a TIC Trap. What is this and how can I avoid it?
Our reply:One form of a TIC trap would be the inability to get out of a property when you need to sell. Unless you are able to provide financing it is very difficult to take advantage of any appreciation that might have occurred during your ownership.
Take an example where there is one master loan on the property and interest rates have gone up. This may make it too expensive to refinance in order to accommodate the new buyer. Most TIC agreements provide that you, the seller who needs to do the refinance, must pay for all of the costs of that refinance. At the same time you must also ensure that the monthly payments of the other TIC owners will not go up.
If interest rates are higher than they were at the time the original loan was made, it may not be financially feaseable to refinance. In that case you are stuck with a lower loan to value ratio and needs to find a buyer with more cash. Another option might be to carry the financing, however, in this case you would not be able to get your money out of the property.
Another trap is to depend on your ability to convert to condominiums in a reasonable amount of time. In today's market it takes 10+ years to qualify and be selected for the condo lottery (as an average) in San Francisco. Unless you are exceedingly lucky and are selected in the first few years, it takes 3 years of owner occupancy, then getting into the lottery where it takes 5+ years to be guaranteed selection, then another year to go through the conversion process.
I think these are going to be major problems with TIC's as the financial markets change.
- Janis Stone
San Francisco property owners get the shaft as Proposition H passes
Once again it is a case of the inmates running the asylum as most of San Francisco voters, who are renters, passed the ironically named
Proposition H (not Preparation H) which will require property owners to pay outrageously high expenses to "eligible tenants" for no-fault evictions. Is it any surprise that more and more property owners are going out of the rental business? It is our opinion that tenants are only hurting themselves in the long run as the supply of good rental units continue to disappear from the market.
Section 37.9C of the Rent Ordinance is set forth in the paragraphs below:
- Each eligible tenant receiving a covered no-fault eviction notice shall receive $4,500, $2,250 of which shall be paid at the time of the service of the notice to quit, and $2,250 of which shall be paid when the unit is vacated. In no case, however, shall the landlord be obligated under this Section 37.9C (e) (1) to provide more than $13,500 in relocation expenses to all eligible tenants in the same unit.
- In addition, each eligible tenant who is 60 years of age or older or who is disabled within the meaning of Section 12955.3 of the California Government Code, and each household with at least one eligible tenant and at least one child under the age of 18 years, shall be entitled to receive an additional payment of $3,000, $1,500 of which shall be paid within 15 calendar days of the landlord's receipt of notice from the eligible tenant of entitlement to the relocation payment, along with supporting evidence, and $1,500 of which shall be paid when the eligible tenant vacates the unit. Within 30 days after notification to the landlord of a claim of entitlement to additional relocation expenses because of disability, age, or having children in the household, the landlord shall give written notice to the Rent Board of the claim for additional relocation assistance and whether or not the landlord disputes the claim.
- Commencing March 1, 2007, the relocation expenses, including the maximum relocation expenses per unit, shall increase annually, rounded to the nearest dollar, at the rate of increase in the "rent of primary residence" expenditure category of the Consumer Price Index for All Urban Consumers in the San Francisco-Oakland-San Jose Region for the preceding calendar year, as that data is made available by the United States Department of Labor and published by the Board.
- Mick Orton
Mortgage Weekly Update - Last Week in Review - Market improving
Foster Weeks does a
weekly mortgage update.
===================================
"The market has improved over the past week after the big drop from the fall out of the revised Jobs Reports, however is running into technical overhead resistance – meaning that it is more likely that rates in the short term are more likely to go up than down.
"This week is loaded with several hi impact economic reports, so stay tuned and we’ll see where this goes.
"Take 3 minutes to read the details of how this affects the Housing Market – knowledge is power!
"FOR MOST FOLKS, NO NEWS IS GOOD NEWS...BUT FOR THE MEDIA, GOOD NEWS IS NOT NEWS AT ALL. - Gloria Borger Isn't that the truth - and aside from election news, much of this week contained little to no economic news or reports for Traders to chew on. This indeed turned out to be good news for Bonds and home loan rates, which improved over the course of the week, although very slightly.
"A few interesting notes from the week on housing and home loan rates...First, the old 'Maestro' himself, former Fed Chairman Alan Greenspan was in the news, saying the current economic downturn was 'likely temporary.' Greenspan also noted the worst of the housing market slump is likely past us. During a Q&A session at the annual Charles Schwab Impact conference in Washington DC, Big Al stated 'The economy is obviously going through a significant slowing period, which as best I can tell is more than likely temporary. And while the housing market is not out of the woods yet, the current slump may not worsen.' A little cryptic in his trademark style...but if he's right, this could point to a
good buying opportunity for homes right now.
"Additionally, rumors circulated about some change in direction of China's massive holdings of foreign exchange reserves - which are mainly ours, in the form of Mortgage Bonds. Remember that their huge appetite for our Bonds has helped keep Bond prices high and home loan rates low. It sounds as if China is looking to diversify the country's foreign-exchange reserves and is considering 'various options', such as trading in some of their hoard of US Dollar-based Bonds - again, such as Mortgage Bonds - in exchange for other foreign currencies and gold. If China is in the process of cashing in some of their Bond holdings,
this could pressure Bond pricing lower in time, resulting in higher home loan rates... read on.
- Foster Weeks
Defining earnest money when buying San Francisco real estate
A reader asks:What is earnest money and why is it called that?
Our reply:Earnest money is the deposit that is to be put into escrow when a buyer makes an offer to purchase a property. It is to show the seller that the buyer is in "earnest" with his offer.
- Janis StoneSee our previous article
Glossary of Real Estate Terms.
C.A.R.-Supported Ballot Measures Approved, PROPOSITION 90 DEFEATED
Four statewide ballot measures supported by C.A.R. were approved by voters during [last Tuesday''s] election. Propositions 1A, 1B, 1C, and 1E passed, authorizing bonds for highway rehabilitation projects, state housing initiatives, flood protection, and levee repair. The Association supported these public works measures because they are consistent with C.A.R. policy and stand to benefit the real estate industry.
Voters also voted against two measures C.A.R. opposed. More than 75 percent of voters said "no" to Proposition 88, the measure to increase property taxes by $50 a year to raise money for schools. Proposition 90, which aimed to prohibit the government's right to seize real property, also failed to pass. C.A.R. opposed Proposition 90 because it would limit the government's authority to adopt certain land use, housing, consumer, environmental and workplace laws and regulations, and would eliminate all redevelopment in California.
More info- California Association of Realtors Read the previous related article explaining the propositions
here.
San Francisco Real Estate Market Update for 10/30 - 11/5/06
Avram Goldman, President and COO of Coldwell Banker, San Francisco Bay Area said in his latest weekly report: "Just like our President says, “Nothing like a good ole’ fashion market”. And that is exactly what it is with a few exceptions.
"Inventories continue to decrease area wide. In fact, we had more offices showing decrease than any other category. In some areas on the Peninsula and San Francisco inventories are at a point where certain neighborhoods are fetching frequent multiple offers. One property in San Francisco garnered 8 offers---another in Hillsborough had 3 offers. Three out of our four offices in SF had 30%-50% multiple offer transactions. Our San Mateo office and our Menlo Park-El Camino office had 35% and 40% multiple offer sales respectively. With that said, most markets are seeing very few multiple offers.
"Uniformly our offices reported brisk open house activity. In Burlingame one open house had 84 buyers through. The buyers are certainly circling. When the sellers hit the right price they bite. A good example is a listing from our Carmel office that received 5 offers on the seller’s fourth reduction. When we have multiple offers most are at listing, a little below or above list price. Most of SF and San Mateo counties are the hot spots in Bay Area real estate. We saw a slight pick up in parts of Marin and Sonoma counties. Santa Clara county also is seeing a bit of a rise. In the East Bay we are still experiencing sluggishness.
"Negotiation is the key. How will I know. We listed our home at an attractive list price and went into escrow within the first week on the market. The buyers came back after inspections with a proposal. I think you all know what that means. Buyers today expect to negotiate and they expect the sellers to be reasonable. Needless to say we were. We received a fair price for our home and the buyers feel they did well too. I am not saying this was easy, this after numerous inspection contingency extensions. My word to sellers is have patience. Just because you are a real estate broker it doesn’t make it any easier.
"There definitely is a change in the market although buyers are still cautious they are ready to buy. We are seeing consistent buyer activity. It looks like the next few weeks should be active. Buyers want to take advantage of the lowered interest rates. The stock market has fed confidence. This is reflected in a number of upper end sales the past week one at $11mil and one at $12 mil. The well-heeled are once again parking their dollars in real estate.
"Here are the numbers for the week of Oct.30th-Nov. 5th: 5 offices reported increasing listing inventory, 12 steady and 13 decreasing---sales activity showed 5 offices increasing, 16 steady and 9 decreasing."
- Avram Goldman* For an e-mail alert when this report is updated, send a note to info@SFResidence.com with "weekly market report" in the subject line.
TRI Coldwell Banker San Francisco real estate statistics - last week in review
Our office at
TRI Coldwell Banker at 1699 Van Ness in San Francisco is one of the premier offices in the City. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.
In most of the pending sales below, buyers were represented. As you can see, there were only two new lisings announced at this week's meeting. If other offices in the City are seeing the same thing, then you could conclude that the real estate inventory is shrinking.
What could this mean to the market as a whole? Low inventory and high demand means that prices usually start to go up. We'll see what happens in the near future.
An interesting note. We attended a seminar and luncheon put on by the San Francisco Board of Realtors two weeks ago. The keynote speaker was an economist who told us that most of the real estate gloom and doom we see in the media is generated by the financial markets. In other words, they want your money in the stock and bond markets, not in real estate. Interesting, if this is true.
11/08/062 new listings (average listing price $1,550,000)
15 ratified sales (pending)
12 closed sales (sold)
3 reduced
- Mick Orton
Two unit building in San Francisco - Condo Conversion
A reader asks:I am currently living in a building that has two residential units and one commercial space. Does this count as a two unit building in regards to condo conversion?
Our reply:A building as you describe it is called a mixed use building. In this case it is considered a three unit building with regard to condo conversion.
- Janis Stone
Focus on San Francisco Neighborhoods - Telegraph Hill
Telegraph Hill as described on the
SFResidence neighborhood guide:
"
Telegraph Hill, formerly known as " Goat Hill" by the many Italians who lived in this quarter, has lovely vistas that are shared by quaint single-family homes and apartments which are coveted due to the proximity to the financial district and nightlife of North Beach. Lillie Hitchcock Coit, a poker-playing, cigarette-smoking millionaire who loved to ride on fire trucks and became an honorary member of the Knickerbocker Engine Company No. #5, bequeathed one-third of her fortune to having a monument, Coit Tower, built on the very top of Telegraph Hill. Today, Coit Tower homes the revolutionary frescoes of Diego Rivera and other less known painters who were financed by the Federal Art project of 1933. Hundreds of tourist a day can be counted while by night lovers parked to enjoy the city lights laid out like a blanket, just steps away from the surviving wooden houses from the 1906 fire that once covered the hill."
For more information on other neighborhoods and street maps visit our
website.
- Mick Orton
Previous Neighborhoods:Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
Mortgage Weekly Update - Last Week in Review - Mountains out of Molehills
Foster Weeks does a
weekly mortgage update.
===================================
"MAKING MOUNTAINS OUT OF MOLEHILLS...seems to be the specialty of the Department of Labor, as another monthly Jobs Report arrived with massive revisions to prior month's numbers. The headline number of new jobs created in October came in at 92,000 — but the Report also added 97,000 new jobs to September's number, and another 42,000 to August, making some serious "mountains" out of previously "molehill" Reports.
"Additionally, the Unemployment Rate fell to 4.4%, the lowest rate in over five years, and Average Hourly Earnings spiked higher than expected. Combined with news received earlier in the week on slowing productivity and increasing costs of labor...this all spells a tightening labor market. If employers have to pay higher wages to attract and retain good employees, this can lead to "wage-based inflation", meaning that businesses eventually have to pass these costs on to the consumer in the form of higher prices for their goods and services. This hot Jobs news - laced with the scent of inflation - caused Bonds to take a nose dive on Friday, and
home loan rates gave back the .125% they had gained earlier in the week.
"So as controlling inflation is the primary concern of the Fed, this report brings up the question — what does the Fed make of this, and what will they do at their next meeting? Will the Fed remain patient, as they wait for the impact of their string of 17 rate hikes to completely filter through the economy? Or will Fed President Jeffrey "The Dissenter" Lacker have his day in the sun, and see the other Fed members agreeing with his inclination to hike? The next meeting is not until December 12th, so they will have a good amount of reports to chew on before then — including another Jobs Report - but the continuing whiff of inflation in the economy is not going unnoticed"...
read on.
- Foster Weeks
San Francisco Real Estate Market Update for 10/23 - 10/29/06
Avram Goldman, President and COO of Coldwell Banker, San Francisco Bay Area said in his latest weekly report: "The market is a kaleidoscope. It has many colors and variations. The picture changes every week. The design changes quickly. There are elements that remain the same and those that change erratically.
"Open home activity remains positive overall. The buyers are out there and writing contracts or about to on the most desirable properties---right price and right presentation. Interest rates have been falling over the last 60 days, although clouds on the horizon could mean that they could rise soon according to the Fed. Those sellers that are adjusting prices to meet market reality are finding their homes in escrow.
"Listing inventories continue to decline slowly. We are still under the inventories of 2002 and 2001. This is a step in the right direction. Those sellers that are not prepared to sell in this market are either lease their homes or take them off the market. This is creating a view that the market is not overcrowded- or oversupplied. This change is prompting a greater sense of urgency among buyers.
"Negotiation is the name of the game. Transactions are taking longer to put into escrow and negotiations last through the escrow in some cases. It requires patience on both sides. Emotions run high, making it challenging both for sellers and buyers. Agents can make a difference in keeping both sides talking and rational.
"As has been the case most of the year and particularly most recently, the upper end of the market in those areas with reduced inventories is active. We have seen a number of sales in the upper single digit and double digit million dollar categories. Obviously those with the means are still seeing real estate as a prime long term investment.
"Multiple offers occurred in over 60% of our offices. The strongest areas of multiple offers continue to be SF and the Peninsula. We continue to see a rise of activity in Sonoma county and parts of Alameda county (north and central). Contra Costa county continues to be the sluggish in sales and Marin county (except in the most affordable areas) has slowed in recent weeks.
"The most positive news is that our open sales volume in October was only off 14% from last October. This is significant, as we have been running in the low 20’s most of the year. At this point it looks like the market is settling into a sustainable pace. This could be the soft landing that a number of economists have been talking about---a market that is reaching equilibrium.
"Here are the numbers for the week: 6 offices reported increasing inventories, 17 steady and 9 declining----8 offices showed increasing sales activity, 16 steady and 8 decreasing (that’s balance)."
- Avram Goldman* For an e-mail alert when this report is updated, send a note to info@SFResidence.com with "weekly market report" in the subject line.
Focus on San Francisco Neighborhoods - Noe Valley
Noe Valley as described by the
San Francisco Chronicle neighborhood guide:
The San Francisco Chronicle describes
Noe Valley as, "a neighborhood of contradictions. It's home to both liberals and conservatives, it has attracted the working class, dot.com millionaires, Hollywood film crews ("Sister Act," "Nash Bridges"), and, in the 1970s, followers of controversial Indian guru Bhagwan Shree Rajneesh. Recent problems with storefront vandalism stand in sharp contrast to Noe's clean-cut image and the fact that it's chock full of upscale restaurants, home-decor boutiques, and chic clothing shops. Since the dot.com boom began waning, housing prices have dipped slightly and there has been some turnover on the main shopping drag, but it remains a prosperous, shopper-friendly neighborhood whose bistros, coffee shops, and bookstores are always lively, and where parking is always at a premium."
Read the rest of the article
here.
Other highlights on this page include:
For more information on other neighborhoods and street maps visit our
website.
- Mick OrtonPrevious Neighborhoods:Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
Timely news about posting political signs!
Although it may be too close to an election for this information to matter this year, but Adrian Adams of
Davis-Stirling posted this great article about political signs and restrictions for home and condo owners that have Home Owners Associations.
- Mick Orton===================================
POLITICAL SIGNAGEQUESTION: It says in our CC&Rs that no political signs are allowed. The association does not want political signs cluttering up the property. Is that allowable?
ANSWER: No, the restriction is unenforceable. Although associations can restrict the placement of signs in the common areas, they cannot prohibit political signs and posters on or in an owner's separate interest, provided the signs are not more than 9 square feet in size.
Civil Code '1353.6QUESTION: We have an owner who claims that his "free speech" rights allow him to do whatever he wants. He draped a large banner from his balcony supporting a political candidate. Can he do this?
ANSWER: No, he does not have unlimited rights. Although he has the right to display a sign in his own yard, window, door, balcony or wall, the association can prohibit signs that are painted on an architectural surface; or are made of flora, balloons, lights, roofing, siding, paving materials, or other similar building, landscaping or decorative components. Associations can also prohibit flags and banners that are more than 15 square feet in size.
Civil Code '1353.6QUESTION: Our rules require that "For Sale" and "For Rent" signs be removed 5 days after the close of escrow or if the listing expires. Can we apply this rule to political signs?
ANSWER: Yes, associations may set reasonable time periods for the display of political signs. Many cities have regulations requiring the removal of signs between 5 and 15 days after the election. Some also limit the posting of political signs 45 to 90 days before an election. Associations may adopt similar restrictions in their rules and regulations.
- Adrian J. Adams, Esq.ADAMS & KESSLER LLP
Making improvements to your San Francisco real estate - hardwood vs. wall to wall carpet
A reader asks: We have wall to wall carpet in the bedrooms and on the stairway and are wondering if we should replace the carpet or put in hardwood floors. Which do you think is a better choice? We got the estimates for both, and hardood floors are much more expensive to have installed. Do you think we can recapture the cost of the hardwood floors when we sell?
Our reply:Of all the flooring choices, hardwood floors can last the longest. In fact, the floors in many homes in San Francisco are now well over 50 years old and still look great. Plus, by reacting with air and sunlight, their appearance actually improves over time as they fade, or darken depending on the type of wood (as in cherry wood floors), to a very desirable patina. Hardwood floors can also be refinished and they are generally easy to maintain. And there are many choices when it come to the type of wood you use; from bamboo to cherry to pecan or the more common oak.
When it comes time to sell your home, hardwood floors are a major selling point and will increase the perceived value of your home substantially. According to realtors, hardwood can add 8% to 10% to the price of a house. In a $750,000 house, that means $60,000 to $75,000 more on the selling price.
- Janis Stone
Down Payment for a San Francisco property
A reader asks:Can a down payment be borrowed or does it have to be my "own" money? (for example any available means through bank accounts, etc.)
Our reply:Yes a down payment can be borrowed as long as the lender is aware of where you are getting the funds and approves your loan with that knowledge. Lenders have different underwriting guidelines so be sure to have lender approval for your loan if you are borrowing funds before you remove the loan contingency.
In a deal several years ago, we made an offer on a condo for a client. The offer had a loan contingency. He was pre approved and qualified to pay the loan payments. And he told me the down payment was available and did not hint that there would be a problem so I did not make this part of his contingency.
What the client neglected to tell me was that he planned to borrow the down payment from his parents in order to buy this property. Once we were in escrow, his parents decided they would not loan him the money after all.
The sellers were very upset when he did not remove the loan contingency and contested the return of his deposit. He had to hire an attorney and fight to get his money returned and finally ended up losing a portion of his downpayment.
The moral of the story is, before you make an offer on a property be sure the funds you are borrowing are really available or it may cost you more than you anticipated.
- Janis Stone
C.A.R. supports four PROPOSITIONS on the NOV. 7 ballot
C.A.R. has taken "for" and "against" positions on six of the ballot initiatives voters will consider during the upcoming Nov. 7 election. The Association supports measures that are consistent with C.A.R. policy and, if passed, will be beneficial to the real estate industry. C.A.R. is "for" the following four ballot measures:
- Proposition 1A, "Transportation Funding Protection"
- Proposition 1B, "Highway Safety, Traffic Reduction, Air Quality and Port Security Bond Act of 2006"
- Proposition 1C, "Emergency Housing, Community Planning and Farmland Preservation Bond Act of 2006"
- Proposition 1E, "Disaster Preparedness and Flood Prevention Bond Act of 2006"
Measures that conflict with C.A.R. policy and, if passed, may have a harmful effect on the real estate industry, are:
- Proposition 88,"Education Funding; Real Property Parcel Tax; Initiative Constitutional Amendment and Statute"
- Proposition 90," Government Acquisition, Regulation of Private Property."
Click on the link below for a complete list of C.A.R.'s positions on the general election ballot initiatives.
More info
- California Association of Realtors
Fast Facts from CAR and Freddie Mac - September 2006
These numbers show that sales slowed in September and rates went up slightly.
- Mick OrtonCalif. median home price - September 06: $553,050 (Source: C.A.R.)
(note: compared to $567,360 last month)
Calif. highest median home price by C.A.R. region September 06:Santa Barbara So. Coast $1,025,000 (Source: C.A.R.)
(note: compared to $1,190,000 last month)
Calif. lowest median home price by C.A.R. region September 06:High Desert $329,040 (Source: C.A.R.)
(note: compared to $332,900 last month)
Calif. First-time Buyer Affordability Index - Second Quarter 06:23 percent (Source: C.A.R.)
Mortgage rates - week ending 10/26:
- 30-yr. fixed: 6.4%; Fees/points: 0.4%
(note: compared to 6.4% and 0.5% points last report ) - 15-yr. fixed: 6.1%; Fees/points: 0.4%
(note: compared to 6.06% and 0.5% points last report ) - 1-yr. adjustable: 5.6%; Fees/points: 0.7%
(note: compared to 5.54% and 0.8% points last report )
- California Association of Realtors & Freddie Mac
Focus on San Francisco Neighborhoods - St. Francis Wood
St. Francis Wood as described on the
SFResidence neighborhood guide:
"The Spanish-style architecture of St. Francis Woods has made it popular to those who love the Mediterranean, who appreciate seasonal smells provided by lawns, and, who prefer living in a village-like setting totally removed from hustle of the city while living within the city! Nearby is the West Portal shopping area which is being protected by its' neighbors from over-development. An assortment of little villages make up this district, which blossomed after 1918, due to the lack of easy access around Twin Peaks. The land prior to the installation of the Twin Peaks Tunnel was part of the Rancho San Miguel estate owned by San Francisco's the last Mexican mayor, Jose Noe."
For more information on other neighborhoods and street maps visit our
website.
- Mick OrtonPrevious Neighborhoods:Castro - Cow Hollow - Diamond Heights - Golden Gate Park - Lake Street - Laurel Heights - The Marina - Nob Hill - Noe Valley - Outer Richmond - Pacific Heights - Russian Hill - Sacramento Street - St. Francis Wood - Sea Cliff - Telegraph Hill
