Archive for the 'Home Selling' Category

San Francisco Market Update

This week, Zephyr Real Estate, reported the following sales:

• 31 Properties Sold
• 12 Received Multiple Offers
• 4 Sold at the Asking Price
• 16 Sold under the Asking Price
• 11 Sold over the Asking Price

At today’s office meeting, we discussed the state of our local market. In giving his thoughts, our manager told us that he is seeing A LOT of Realtors making purchases. We are the ones most on the inside of the market so if we are buying, YOU should be buying.

There is likely only about 6–8 months left of this more balanced, “buyers” market. Take advantage of it.

I promise you that the time will come (and perhaps sooner than you think), when San Francisco real estate sizzles again. Do you want to be a renter or a homeowner during the next boom?

When it comes to super-star cities, like NY, SF, etc, it is hard to imagine the next boom not coming.

Know what I mean?

Tom Sinkovitz, Former KRON-TV Anchor, Talks San Francisco Real Estate

 

Check out these informative videos about San Francisco consumer real estate issues! Topics include:

Why It Makes Sense to Use a REALTOR®

Where Is the Market Headed?

Renting? It Might Make More Sense to Own

Shared Equity Mortgages, An Alternative for Some

What to Do If You Have a Problem Mortgage

Watch the Videos HERE.

 

 

Add a Bathroom, Add Lots of Value

Our friends at Green Tree Financial offered up this informative Money Magazine article on home remodeling. It’s helpful, easy to digest info on what type of bathroom addition gives the most bang for the buck.

A BIG PAYOFF FROM THE TINIEST ROOM

For the surest bet in home remodeling, build a new bathroom
And add up to 20 percent more value to your home

By Josh Garskof, Money Magazine contributing writer
September 7 2007: 10:25 AM EDT

(MONEY Magazine) — Adding a new bathroom will enhance your quality of life – and the value of your property – like few other home improvement projects will. Put in a master bath, and you won’t have to take turns with the kids every morning. Install a powder room, and dinner guests won’t have to traipse through your private terrain.

While you can’t count on recouping the cost of any upgrade right away in today’s weak housing market, over the long term adding a bathroom can boost your home’s value by some 20 percent, says Paul Emrath, an economist at the National Association of Home Builders.

Of course, there’s also almost no limit to what you can spend on a bathroom. “It’s easy to get to $50,000, $100,000 or beyond for a new master bathroom,” says Todd Polifka, CEO of Vision Remodeling, a contractor in the Twin Cities area. The more you get carried away, the more remote your chance of a big return. So keep these principles in mind.

Make up for your biggest shortfalls.

Simply put, you’ll get the biggest bump from adding a new bathroom if you have too few to start with, according to Emrath’s analysis of 2005 Census statistics for 60,000 homes across the country. Another time it pays off is when you have far fewer bathrooms than bedrooms.

A bonus bathroom can also reward you handsomely in a two-story home. Buyers look for a minimum of one bathroom on each floor of a house, says realtor Debra Kandrak of William Raveis Real Estate in Fairfield , Connecticut . “People want at least a powder room on the first floor, no matter how many bathrooms are upstairs,” she says. That bathroom-on-every-floor bias also applies to finished attics and basements.

Don’t get ahead of the neighbors.

If you want to recoup your investment, stick with what’s normal in your neighborhood. “On some blocks, master bathrooms are expected. On others, they are nonexistent,” says Omaha appraiser John Bredemeyer. “If you add a third bathroom in an area where homes have 1-1/2, you may not get your money back.”

You don’t have to knock on neighbors’ doors to ask how many bathrooms they have. Troll real estate listings, or try looking up those details in public tax-assessment records at town hall or the county tax office – and quite possibly via a government Web site.

Or you can plug in your address at the house-valuation Web site zillow.com, and then click around on the resulting map to get the public statistics about your neighbors. (Look at plenty, since the stats may not all be up-to-date.) <From SFHotlist Blog, Your Real Estate Consultant is also a good source of information as they can tell you first-hand what buyers are looking for and what neighborhood norms are.>

Use what you’ve got.

One of the best ways to keep a lid on the price is to tap your house’s existing space. Building an addition to accommodate a new bathroom means pouring a foundation and constructing a roof, bringing the cost to a minimum of $200 a square foot, according to appraiser Bredemeyer.

But if you can add the bathroom without putting on an addition, you can cut that cost to as little as $100 a square foot. If you avoid building new walls by using a spare room, walk-in closet or under-the-staircase niche, you could save another $3,000 to $5,000. And try to stay close to existing plumbing lines. Otherwise, running four-inch drain pipe through floors and walls can easily increase your budget by $4,000 to $5,000.

Don’t go overboard.

The biggest factor in your bathroom’s price tag, of course, will be the materials and fixtures you choose. You can get a perfectly good faucet for $100, or you can install a $3,000 showpiece; simple porcelain tile that’s $5 a square foot or translucent glass tile at $25; a tub-and-shower combo ($1,000 to $3,000) or a separate soaking tub and a walk-in shower ($2,000 to $5,000).

Suit your own tastes, but also remember that when you sell not every buyer will be enamored of an effervescent air-jet tub. <From SFHotlist Blog, Stay neutral, stay mid-range and think about resale. Basically, keeps the finishes in alignment with general tastes and budgets, i.e. don’t serve beer in a champagne ‘hood or vice versa.>

And, once again, let neighborhood standards be your guide, so you don’t overshoot what buyers will be willing to pay someday. “Then again, if you’re going to be enjoying the bathroom for many years before you sell, don’t hold back,” says Bredemeyer. “Do what will make you happy.”

Another interesting article:
Kitchen face-lifts for the frugal

Price Low(er) to Sell High(er) or at least Sell at all

Believe me, I’m as shocked as you are…the Sunday Chronicle Real Estate section has an article on how to sell one’s home that does NOT lambast agents or promote discount web sites that coincidentally get paid every time you don’t use a licensed Realtor.

(Remember all of those articles on selling for sale by owner that used the guy from ForSaleByOwner.com as their primary interviewee “expert?” Can we say, conflict of interest? But, I digress…)

Of course, it’s NOT written by a Chron staffer, but hey, it’s a start. My intention was to link to the full article on SFGate.com. I cannot find it! Coincidence? Hmmm…maybe they realized this could be construed as neutral writing and yanked it from the archives. More likely, I just can’t find it so if you can, please comment below so all can read.

If you are still here and haven’t tripped over my soap box on your way to another site, here’s the scoop.

If you want to sell your home for top dollar, in a reasonable amount of time, you MUST price it competitively. Competitive pricing means just under the competition. You cannot price it at your “dream” price just to see what happens and reduce later. Well, you can but you will likely end up with less money this way. Realtors know this b/c we study the market on a daily basis and yet, we are often argued with when it comes to pricing.

Today’s San Francisco market is much more balanced, with about a 3–months supply of inventory City-wide. We are not in a bad market though it is different. Both sides must play fair.

Here are some snippets from Sunday’s article:

“Realistic pricing moves homes faster, for more” by Kathleen Lynn (Hackensack, NJ Record)

“Realtors often warn sellers about the danger of over-pricing a house. Now they have evidence to show skeptical clients: research by Jeffrey Otteau, a New Jersey appraiser.

He found that in a market where prices are declining, sellers who ‘test the market’ with a high price usually end up with a lower price than those who price realistically. ‘Houses that are priced right are selling,’ said Otteau. ‘Over-pricing extends days on the market and guarantees that you will sell your home for less in a declining market.’…

They (sellers) should aim to under price the competition. ‘You can’t just try for a higher price b/c you really want it,’ he said. ‘The way to get a higher price is to create a sense of urgency by setting a lower price.’

 

September 2007 San Francisco Real Estate Trends

 

San Francisco’s real estate market is…? What is going on anyway? In casual polling of fellow agents, I hear words like, “random,” “spotty,” “hard to predict,” “complex,” and so on.

At our Zephyr Real Estate  office meeting, agents will announce their sales (address, list price, #offers, and a ball park estimate of sales price). These meetings are a phenomenal way to stay in touch with the broader market trends. Lately, the results seem to confirm these confusing adjectives!

Some houses received many offers in 2 weeks and sell for $50–$150k over the asking price while others get one offer weeks or months into the listing. Typically, these sales are at or slightly under the listing price.

What I find fascinating is that sales are down BUT prices are UP from last year!

Note to home sellers: if you’ve lived in your property at least 3 years, not to worry! If not, it depends on your particular place. Some of you are best off staying put for another few months at least while others could get a tidy profit even now.

Note to home buyers: Buy, buy, buy. Much of SF is on sale for the short-term. Get in and take advantage before the market picks up early next year.

Check our Cleanoffer.com’s Real Estate Market Trends Report. An excerpt is below and click HERE for the down loadable PDF.

Happy analyzing and Trick or Treat!

Credit Crunch Crunches Sales

Trends at a Glance
(Single-family Homes)
	Sep 07	Aug 07	Sep 06
Home Sales:	152	199	218
Median Price:	$882,500	$925,000	$828,000
Average Price:	$1,041,775	$1,151,952	$1,034,913
Sale/List Price Ratio:	103.0%	106.1%	101.3%
Days on Market:	37	36	41

As expected, the credit crunch had a big impact on sales in September. Sales of single-family, re-sale homes fell 23.6% from the month before, and were off 30.3% year-over-year. Year-to-date, home sales are off 9.3%. We expect sales to be slow this month, then start to recover at the end of the quarter as the credit crunch is alleviated.

The median price for single-family, re-sale homes dropped 4.6%, a year-over-year gain of 6.6%. The average price fell 9.6%, up 0.7% compared to last September.

The median price for condos in San Francisco fell 4.3% to $785,000 from August, up 1.3% compared to last September. The average price for condos lost 3.6% to $816,513, month-over-month. The average price was up 8.6% year-over-year.

San Francisco condo sales fell 26.8% in September, down 10.6% year-over-year. Year-to-date, condo sales are down 0.8%.

Zephyr Hosts a Free Seminar for Clients with Real Estate Attorney! Get your questions answered.

How Foreclosure Can Happen in San Francisco

Want to hear a NIGHTMARE from the field? Here’s an example of what can happen to you without the right representation…

Joe* was renting a fancy South of Market Loft back in 2004. One day, he came home to find a letter from his landlord saying that he was going to sell the loft and Joe had to move. Since most lofts are not under San Francisco rent control, it was true that he would have to move. Joe not only lived in his loft but also conducted his business out of it. The letter also said they landlord would be willing to sell the loft to Joe….

Why not? He knew the San Francisco real estate market was in the midst of a boom and all of his neighbors were selling their lofts for a great profit. Being self-employed, Joe did not have verifiable income or many assets. His credit was great so he was able to secure 100% financing NINA loan (No Income, No Asset). So what, if the loan had much higher interest rates that were only fixed for 3 years…the market was booming and his loft will appreciate.

And so, Joe bought his place. What’s the problem, you ask? It’s now 2007, and Joe’s interest rates are about to adjust. He can no longer qualify for a refinance because lending guidelines are stricter. Still without verifiable income or assets, Joe is stuck with his current loan. His current loan was already about 2% HIGHER than the typical loans and is about to jump up, A LOT. He can no longer afford to make the payments.

Okay, so he can sell the loft, right? Well, not so fast. Joe and his landlord conducted the sale privately, without benefit of Realtor representation or a sale on the public market. You guessed it! He paid WAY too much for his loft back in 2004. Instead of allowing a real estate professional to analyze the price for the listing and then letting the public make the final decision, Joe’s landlord set the price. Naturally, he inflated the price to his benefit.

2004 was the peak of this current market cycle. 2007 is at or near the bottom. Joe’s loft has not appreciated past the inflated price he paid. It was not worth what he paid then and it is not now. Joe cannot sell for a profit. In fact, he cannot sell for a break-even. This will be a loss and potentially, a big one.

The moral of the story: Capitalism works publicly for a reason. Buyers decide the value of a commodity, whether a stock or a house. By enlisting a trusted advisor and purchasing a publicly marketed home, you protect yourself. Allow the market to determine the value of your home, not the owner.

Of course, markets go up and down so it’s certainly possible to have your home’s value go down even if you paid the right price when you purchased. But just imagine how much worse it can be if you had paid even more than your home’s worth at the peak of the market…

*Names & details have been changed to protect the innocent.

5 Powerful Homebuying Strategies for San Francisco Homes, Lofts, Condos, & TICs: Part 5

Find a Real Estate Consultant (a.k.a. Realtor)

It is most essential for your safety and success to hire your own Realtor representation. Whether you are interested in my services or not, I encourage you to interview and choose a consultant you feel comfortable with and enlist that agent as your “Buyer’s Agent”. When you work exclusively with a Buyer’s Agent, you become a client with all of the rights, benefits, and privileges created by this agency relationship.

You are no longer just a shopper. You are an appreciated client. When an agent hears of a great buy, who are they going to call? Her client with whom she has an established, trusting relationship or a stranger who just called on the phone and said, “keep your eyes open for me, would ya?”

“Great deals” go to those people who are committed to working with one agent because they find out about them and have someone ready to negotiate them into contract.

Aside from getting a value on your home purchase, you also get immeasurable support and guidance from your Real Estate Consultant. Buying or selling a property is an important and significant decision in your life with many financial and legal consequences/obligations.

You deserve to have the best counsel at your side.

Want to hear a NIGHTMARE from the field? Here’s an example of what can happen to you without the right representation…

Joe* was renting a fancy South of Market Loft back in 2004. One day, he came home to find a letter from his landlord saying that he was going to sell the loft and Joe had to move. Since most lofts are not under San Francisco rent control, it was true that he would have to move. Joe not only lived in his loft but also conducted his business out of it. The letter also said they landlord would be willing to sell the loft to Joe….

Why not? He knew the San Francisco real estate market was in the midst of a boom and all of his neighbors were selling their lofts for a great profit. Being self-employed, Joe did not have verifiable income or many assets. His credit was great so he was able to secure 100% financing NINA loan (No Income, No Asset). So what, if the loan had much higher interest rates that were only fixed for 3 years…the market was booming and his loft will appreciate.

And so, Joe bought his place. What’s the problem, you ask? It’s now 2007, and Joe’s interest rates are about to adjust. He can no longer qualify for a refinance because lending guidelines are stricter. Still without verifiable income or assets, Joe is stuck with his current loan. His current loan was already about 2% HIGHER than the typical loans and is about to jump up, A LOT. He can no longer afford to make the payments.

Okay, so he can sell the loft, right? Well, not so fast. Joe and his landlord conducted the sale privately, without benefit of Realtor representation or a sale on the public market. You guessed it! He paid WAY too much for his loft back in 2004. Instead of allowing a real estate professional to analyze the price for the listing and then letting the public make the final decision, Joe’s landlord set the price. Naturally, he inflated the price to his benefit.

2004 was the peak of this current market cycle. 2007 is at or near the bottom. Joe’s loft has not appreciated past the inflated price he paid. It was not worth what he paid then and it is not now. Joe cannot sell for a profit. In fact, he cannot sell for a break-even. This will be a loss and potentially, a big one.

The moral of the story: Capitalism works publicly for a reason. Buyers decide the value of a commodity, whether a stock or a house. By enlisting a trusted advisor and purchasing a publicly marketed home, you protect yourself. Allow the market to determine the value of your home, not the owner.

Of course, markets go up and down so it’s certainly possible to have your home’s value go down even if you paid the right price when you purchased. But just imagine how much worse it can be if you had paid even more than your home’s worth at the peak of the market…

*Names & details have been changed to protect the innocent.

 

 

Check out the Suprising Results: Has your home’s value gone up or down? Depends on where you live!

All real estate is local. Okay, yes, we are all affected by national and international economics, such as the recent credit crunch. BUT, how we are affected depends on where we live.

California is not equal. San Francisco is not Fresno. Alameda is not Albany. And so on.

Want to know how your City and County faired this year over last. Check out the attached PDF with the Median Home Sales Price July 2007 compared with July 2006.

The results are surprising…

San Francisco City and County: Median Home Price is up 2.90%

Sonoma County: Overall Median Home Price is down 3.61% BUT…

Geyserville is UP 17.24% while Guerneville is DOWN 31.95%.

Of course, take these statistics like all others with a grain of salt. The Median Home Sales Price is only good for an overall picture. To find out how your home has faired you must look even closer…

For example, right now in San Francisco, single family homes in the Sunset continue to fly off of the shelves, while lofts & condos take a little longer to sell.

In general, the San Francisco real estate market is vibrant & healthy, despite what you may have heard. Yet, Fall 2007 brings a vastly different real estate market than in recent years. It’s complicated, somewhat random, and all about the financing.

File Attachment: California Home Sale Price Medians by City July.PDF (225 KB)

5 Powerful Homebuying Strategies for San Francisco Homes, Lofts, Condos, & TICs: Part 2

Sell First, Then Buy? Buy First, Then Sell?

The answer to this tricky question really depends on your personal situation & the real estate market where you live. Your time line, financial capabilities, immediate needs, and the current market conditions will factor into whether it makes more sense for you to buy, then sell or sell, then buy. Also at play is your own personal style and way of living at home. If you live in a museum, a.k.a. a clutter-free, minimalist & neutral home, it will be easier for you to sell your home for top-dollar while you live there.

It would be a disservice to your for me to give one hard set of rules for everyone. In order to recommend various options for your San Francisco real estate needs, I’d have to understand your circumstances in detail. Together, we would plan the best approach for you.

Timing is everything in San Francisco real estate and our ability to act and react QUICKLY should be of utmost importance to you. After all, time is not only money but also emotional and psychological energy!

In case this vague answer is not enough for ya, here are some real-life examples….Ripped From the Headlines of my Clients’ Lives! *

Example 1: Tom, successful attorney, minimalist guy.

Situation: Selling his SoMa loft; Buying a Victorian flat in Noe Valley.

Factors at Play:

1. The SoMa loft market was strong; well-priced and presented lofts were selling within a couple of weeks & with multiple offers.
2. The 2–Unit TIC market was even stronger. Making a purchase would require extremely aggressive offers and perhaps, multiple tries before being the successful bid.
3. Tom had the financial wherewith all to have 2 mortgages for a month or two.
4. Tom’s loft was in a coveted building and location. His design aesthetic is minimal and stylish. The place looked professionally staged already!
5. With his busy job and flexible schedule, Tom was able to keep his loft clean and available for showings with short notice.

In this situation, we were confident that his loft would sell quickly & for over-asking as long as the price was right, he kept up the good look, and we did some high-tech, high-touch marketing.

We were not as confident about the timing of his purchase. Tom is a conservative guy, looking for a good value. He was willing to try more than once to get the right home, at the right price. He was not interested in paying way to much for his new home just to outdo the Joneses! He knew he’d have to make an aggressive, over the asking price offer but always did so within the realm of reason. In the end, Tom wrote 3 offers before landing his Noe Valley duplex TIC.

Outcome: Buy First, Then Sell.

While Tom was shopping for his San Francisco Tenancy-in-Common, we prepared his South of Market loft for sale. As soon as he went into escrow and removed his contract contingencies, we put his loft on the market. We sold his loft within 2 weeks with multiple offers and for more than his asking price. He had 2 mortgages for less than a month!

Example 2: Melanie, successful marketing executive

Situation:  Selling her Potrero Hill condo; Moving to London for exciting new position & career advancement.

Factors at Play:

1. The Potrero Hill condo market was strong. Potrero Hill has such limited inventory that cute condos on the North Slope are usually in full demand and short supply! Melanie’s condo was walking distance to 18^th & Connecticut, home to Chez Papa, Chez Maman, Goat Hill Pizza, Eliza’s and so much more.
2. Her new company was paying to relocate her and setting her up in an apartment in Notting Hill. She had a place to live in London as she got her bearings. If the job worked out and she decided to stay, Melanie planned to purchase a flat there. If not, she would move back to San Francisco and buy a new condo.
3. Her new company wanted her to move ASAP. Melanie wanted to make sure her condo was sold before moving overseas.
4. Melanie’s condo is chic and her modern style would show well in the market. Though not as minimalist as Tom, with some help from our stager & a small local storage unit, we were able to make her place ready for showing, while enabling her to continue living there.

Outcome: Sell First, then Move.

Melanie wanted to take care of her affairs here in San Francisco before moving overseas. It was a big deal to up-root her life for this new adventure so she needed the stability of knowing her condo was sold & the money was in the bank. Since she was not sure where her life would lead her in the coming 1–3 years, Melanie wanted to keep her sales’ proceeds in more liquid investments. When she decided where she was going to live for the next few years, she’d have the money ready for her down payment. Melanie understood that her condo had to look like it was staged and was a great sport. We sold her condo within the month and she bought her plane tickets!

There are many more examples of how folks have successfully structured the timing of their San Francisco real estate sales and purchases. The main point here is that every situation is unique and it’s important for you to determine the best plan for you!

 

*Please note all names have been changed to protect the innocent.