Danielle Lazier

Archive for the 'San Francisco Real Estate' Category

TIC loan record:Spotless

Concerned about the risks involved with TIC financing? Not to fear!

Apparently, the record is excellent.

I’d say this is because the fractional TIC loan lenders have always maintained strict lending guidelines, i.e. great credit, solid savings, and a stable job! No, sub prime here!

Of course, you pay more for these loans but for a TIC buyer, they can offer safety & security as you are no longer tied to another person through the group loan.

If you own a multi-unit building, these loans are a great way to cash out of all or part of your property…

Check out the Chronicle article here: TIC loan record:Spotless.

What Fed cuts really mean for mortgages

Brought to you by Inman News…

Commentary: Average rates on mortgages unchanged in recent surveys

By Lou Barnes
Inman News

Contrary to the conviction of deeply confused civilians and reports by lazy news media, mortgage rates are unchanged, about 5.75 percent for the lowest-fee 30-year paper.

If you don’t believe me, visit www.freddiemac.com and its weekly survey. It is unbiased by sales jive, although it suffers from “survey lag” (early-week data released on Thursdays always misses real-time reality), and assumes a fractional origination fee. Last week’s “5.48 percent” captured the one-day hysterical bottom when the industry could not log onto rate-lock Web sites. Yesterday’s “5.68 percent plus 0.4 percent origination” is still about right, and all but identical to the prior week’s “5.69 percent plus 0.5 percent.”

Yet, the media refer constantly to “dramatically lower mortgage rates.” They are better, but … drama? Freddie’s average for the whole of 2007 was 6.34 percent. A half-percent drop is nice for buyers, and a help to a few refinancers, but no fire sale.

“How can it be the same … !?!” says the client, after a cumulative 1.25 percent cut at the Fed in only eight days? Answers follow.

Brand-new January economic data are not that bad. They’re not bad enough to justify the Fed’s panic, let alone to anticipate more cuts. Payroll growth slipped to flat in January (negative 17,000 is within the huge range of error and revision), unemployment down to 4.9 percent in a workforce statistical quirk — soft, but hardly a recession. The purchasing managers reported their first gain in six months, likewise soft, but with persistent strength in foreign orders. Fourth-quarter GDP grew by a mere 0.6 percent; however, aside from a temporary drawdown of business, inventories grew at 2 percent.

The Fed’s form is disturbing to long-term investors. Central banking is not figure skating, but Fed Chairman Ben Bernanke has departed his predecessor’s 17 years of gradualism for lurching on the rink. A Fed that will lurch down will lurch up.

Investors bought long Treasurys and mortgages at these levels 2002-2004 because former Fed Chairman Alan Greenspan said after every meeting into 2006: Excessive monetary stimulus most likely will be “removed at a measured pace.” Translation: You’re safe for now, and we’ll give you time to get out before we kill you.

In those late Greenspan years, deflation was the problem. Today, inflation is rising all over the world: Australia at a 16-year-high of 3.8 percent core; Europe at a 14-year-high of 3.2 percent; U.K. at 2.6 percent core; China at 6 percent-plus; and an economy completely out of control beginning to export inflation to us. Each time the Fed has lurched to a catch-up ease, all the way back to August, it has rescued stocks, commodities, oil, gold, and tanked the dollar.

I have chewed on the Fed for its inaction and credit-wreck oblivion. However, this situation is NOT a monetary problem: It is a banking-system near-insolvency that may morph into a recession, each making the other worse. The crying need for six months has been transparency of credit loss and bad-asset firewall. Cuts in the overnight cost of money may intercept recession, but inflation means that these cuts cannot be maintained or removed at a measured pace.

A central bank chairman must be prepared for the ultimate sacrifice: No tough inflation problem was ever solved by slow growth. It takes a recession. It takes higher unemployment and crushing the commodity spiral. To get long-term rates down, Bernanke must get the good out of this slowdown: He must let it get ugly. Instead, he has rescued inflation-pushing markets again and again.

Two non-Fed forces holding up mortgage rates: Credit fear about Fannie and Freddie has the spread between mortgages and the all-defining 10-year Treasury (3.57 percent today) over 2 percent for the first time ever. Second, somebody by accident may arrive at an effective credit-wreck bailout: The giant bond insurers, Ambac and MBIA, may be resolved in days. If no collapse, then credit fear will give way to inflation fear.

The Fed’s cuts have had a dramatic effect on ARM adjustments, and should revise estimates of housing doom to the better — also reducing bond-market fear. This month, common one-year Libor-floating loans will adjust DOWN to 5.125 percent.

Lou Barnes is a mortgage broker and nationally syndicated columnist based in Boulder, Colo. He can be reached at lbarnes@boulderwest.com.

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Copyright 2008 Lou Barnes

Senate finance committee OKs amendments to stimulus package

As you may have heard, Congress is working on a economic stimulus package…

The version that passed in the House includes very exciting provisions for California home buyers and home sellers.

It would raise the conforming loan limits in high-cost areas of the country to to 125 percent of the median home price in high-cost areas.

In San Francisco, we are likely to see an increase in conforming loan amounts to $600,000 to $700,000! I’ve heard $625,000 thrown around.

Conforming loans have lower interest rates which means more San Franciscans will be able to afford to become homeowners.

Of course, if this happens, we are likely to see a spike in activity which could drive up prices.

Right now, the end result is unclear and not a guarantee at all. The Senate must vote on the entire bill and they may remove/amend/change this provision.

We just don’t know yet…but we are paying attention and will keep you updated!

Personally, I would not recommend waiting b/c 1. it may never happen and 2. it may increase offers and thus sales prices.

Rates are really good right now as they are and values abound in the TIC, loft, and condo market.

Check out the full story here: Inman Real Estate News – UPDATED: Senate committee OKs amendments to stimulus package.

Eminent Domain Ballot Initiative for California

Coming on the June 2008 ballot is an initiative to help protect California homeowners.

Check out the fact sheet here: http://www.yesonpropertyrights.com/facts/.

 

Economic stimulus a big break for home buyers

The economic stimulus package working it’s way through the House offers some outstanding news for local San Francisco real estate.

If passed (and we think it’s likely to), the conforming loan limits for Fannie Mae backed loans will increase substantially. Conforming loans have MUCH lower interest rates. What this means is that more home buyers will be able to afford real estate in the Bay Area.

This is great news for 1^st time buyers as well as anyone who wants to take advantage of the big discount.

It will only last for one year!

My guess is that this will stimulate real estate sales in SF and benefit both home sellers and home buyers.

Pay attention to this b/c when it goes into effect, you will want to benefit.

Here’s the meat of the article and a link to the full story:

Economic stimulus a big break for home buyers.

San Francisco Real Estate is Boom or Bust right now, depending on where you are.

”It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way–in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.” –Charles Dickens, A Tale of Two Cities

Granted this is a cliche-ed cliche but nonetheless, we here at the SFHotlist are very pleased to see some neutral San Francisco real estate commentary from the Chronicle. Thank you, Carol!

Okay, it may not be the best of times anywhere for San Francisco real estate though for much of the City (Noe Valley, Castro, Potrero Hill, Bernal Heights, Pacific Heights, etc), times are pretty darn good. While the fear mongerers battle it out on the radio and TV news channel, we on the front lines, the real estate agents, can report low inventory and strong demand.

Today, I toured a Bernal Heights single family home. The sellers received an over-asking price offer before their 1^st Broker’s tour!

Each day, I receive email from fellow Zephyr agents wanting to know if we have listings coming on the market soon that will meet their buyers’ needs.

I sold a SOMA TIC Victorian flat in December only to have the buyer back out with cold feet. Two weeks later, I sold it again….for MORE money.

And the examples could go on.

Moderately realistic sellers AND buyers are able to make happy, successful negotiations. It is not party like it’s 2004 for sellers, and it is not a Ross super clearance sale for buyers.

If you have owned your home for 3+years, your property has likely appreciated nicely & in early 2008 the buyers are back but the inventory is not. If you have saved for a down payment (even 5–10%) and have a good job/credit, there are properties you can buy for relatively good value AND with great interest rates.

So, why does the media consistently report that our market has busted and will take a long time to rebound?

BECAUSE, THIS ROSY STORY HOLDS TRUE ONLY FOR PARTS OF SAN FRANCISCO!

Parts of San Francisco real estate are troubled. There are short sales, foreclosures, and REOs (bank-owned) sales. There is too much inventory and not enough demand.

As Carol Lloyd astutely wrote in her January 6^th, 2008 column, “Far from the Nob Hills and Noe Valleys, the Pacific Heights and Outer Sunsets, there are neighborhoods stretching across the southern and eastern quadrant of the city that tourists have never heard of and many San Franciscans have never visited. And it is these areas — Portola, Ingleside, Ocean View, Mission Terrace, Outer Mission, Bayview, Excelsior — which have been hit hardest by the real estate downturn.”

These neighborhoods are skewing the numbers…

“Indeed, an inordinate number of the single-family homes coming on the market in recent weeks are located in these neighborhoods. What’s more, they seem to be staying on the market longer: 77 percent of December’s SFNewsletter’s list of “stalefish” (houses that have been on the market for more than 100 days) come from these neighborhoods. The result is that although they represent only about 25 percent of the city’s land, and less than a quarter of the city’s population, such neighborhoods are overly represented in the real estate statistics.”

Remember that all real estate is local and when I write local, I mean really local. This is about niche markets. What’s happening in your ‘hood may have absolutely nothing to do with what is happening across town. (Sometimes, even across the street if you live in an area with a lot of rent controlled housing and who doesn’t?)

As we usher in 2008, I wish you the best of times in your neighborhood and a critical eye towards the media. Depending on your individual situation, it really is a great to buy or sell.

Check out the complete column here: In real estate: A tale of two Friscos.

Need a Holiday Gift Idea?

It’s not exactly real-estate related….yet I want to share this neat gift idea. Destination Dinners is a fun, yummy, and totally unique way to wish someone a happy holiday season. They are perfect for thank-yous too!

The concept is that you get a beautiful box complete with everything you’ll need to create a snazzy international dinner, except the fresh food.

 

 

For example, we made a Bangladesh chicken dish and only needed to purchase the chicken! It was easy and a lot of fun.

 

Check out their website for more info & enjoy.

Show your friends, family, clients that you are a well-traveled cook, even if you’re not! The box sets are great for dinner parties too and do not require a degree from the CCA! Promise…

Happy gift-giving!

* Destination Dinners will be featured on Wednesday Dec 12th – 3PM PST’s View From the Bay too. Check out the buzz.

** Know of a neat local San Francisco business or product? Let us know!

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.

 

 

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.’