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Bay Area Real Estate Is Crazier Than Ever — How Do You Win A Bidding War?

in Bay Area News, Bay Area Real Estate by Wendy Gittleson Leave a comment

Earlier in the month, news broke that a house in Sunnyvale sold for almost $800,000 over the asking price. It was a modest, by middle Americans standards, three bedroom, two bath house. The house is only about 1,200 square feet, which is less than half the average American home. It caused a bidding war and next thing anyone knew, it sold for $2,470,000, which was $782,000 over list.

What is a bidding war?

Bidding wars have become the norm in California real estate. Savvy real estate agents often intentionally list homes on the low end, hoping to encourage bidding wars. The tactic works. That Sunnyvale home had 15 offers, seven of which were from people who worked at either Apple or Google.

It’s not just Silicon Valley. When we bought our East Bay home, we lost several properties to bidding wars, and ultimately to cash offers, before settling on our “needs a little work” choice.

Can a regular person win a bidding war?

If you are an executive at Google or Apple (or at any number of tech firms), you might not have a problem, but for those of us who have solid middle class incomes, a low down payment and good credit, is there a chance?

While it is tough to compete with billionaires and those with all-cash offers, there are ways to help boost your chances. Here are some tips from CNBC:

  1. Get pre-approved and pull together some cash — Sellers don’t have the patience these days to deal with uncertainty. They want to know that any offer is set in stone, so make sure you are pre-approved for your loan and try, if at all possible, to put down at least 20 percent.
  2. Be quick — In a hot housing market, look at the hunt as a second job. Don’t rely on just your realtor. Drive your desired neighborhoods and religiously scan Realtor.com for new listings. Try to schedule immediate viewings. The goal is to be the first offer.
  3. Include an escalation clause in your offer — Ask your real estate agent to include an escalation clause that will allow you to top other offers, up to your desired upper limit. The clause, if properly worded, will raise your offer to just above the highest current bid. For example, if you list your highest bid at $500,000 and the current highest offer is $480,000, your official bid will be about $481,000.
  4. Inspection — While nearly every expert recommends that a homebuyer have the house inspected, in a seller’s market, it could disqualify you. Instead, CNBC recommends that you go ahead with the inspection before making the offer. You will have to pay for it, but the seller will be happy to know that you won’t back out because of previously unforeseen problems with the house.
  5. Charm the sellers — Unless your seller is just an investor, they have invested a decent portion of their lives in that house. Sure, they want to maximize their profit, but they also want to know that the house will be loved. Send them a house love letter (your agent can forward it). Include pictures of your family.
  6. Remember it’s not just about winning — Winning a bidding war is great, unless you don’t really want the prize. Spend some time in the neighborhood. Check out the schools. Also have your agent check “comps” or comparable sales to make sure you aren’t overpaying for the home. As tight as our housing market is, it’s still better to rent than to dramatically overpay for a house you didn’t really want.

More Than Half Of San Jose Home Sales Have A Co-Signer

in Bay Area News, Bay Area Real Estate by Wendy Gittleson Leave a comment

Earlier in the year, San Jose was named the most unaffordable city in the country. It’s no wonder, with the median home cost at about $900,000. Still, with a population of over 1 million, and growing, people are making San Jose home sales work.

How are people in San Jose able to buy homes?

A report in September may explain how people are still buying real estate, despite the high costs. They’re getting help. According to a report from Attom Data Solutions, which compiles nationwide property data, just over half (50.9 percent) of San Jose’s homeowners bought with the help of a co-signer — that’s more than in any other city.

The report shows that for the first time, more than half of all home-purchase deals in San Jose involve co-borrowers. No other city has topped the majority.  San Jose was followed by 45.2 percent in Miami; 39.1 percent in Seattle; 31.1 percent in Los Angeles; 29.4 percent in San Diego; and 28.8 percent in Portland.

“Climbing home prices are forcing more and more borrowers to consider other options, such as leveraging a parent’s credit, in order to qualify to buy,” Matthew Gardner, chief economist at Windermere Real Estate, said in the report.

Source: Mercury News

The good news is that percentage wise, homeowners in San Jose have more equity than in other cities. Partly because they are making bigger down payments and partly because San Jose’s real estate market is so strong. Nationally, the median down payment is only about 7.3 percent of the median price of a home.

Now look at the numbers for San Jose, where buyers put down 25.2 percent of the median price of a home. Again, that was the highest median down payment in the U.S., followed by San Francisco (22.3 percent), Los Angeles (19.3 percent); Naples, Florida (18.5 percent); and the Oxnard-Thousand-Oaks-Ventura metro in southern California (17.4 percent).

Perhaps the same people co-signing on the mortgages are also helping with the down payment, which of course, makes the mortgage payments far more affordable.

Featured image via David Sawyer/Flickr.

The Healthiest Real Estate Markets Are Right In Our Backyard

in Bay Area News, Bay Area Real Estate by Ninja Movers Leave a comment

While Bay Area real estate is still some of the most expensive in the country, the market has been slowing down somewhat. Still, some markets are healthier than others, and as it turns out, two of the healthiest real estate markets in California are right in our backyards.

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The healthiest market for home sales and for home values is Fremont. Fremont is even affordable, at least with Bay Area wages. The average Fremont homeowner spends only about 22.5% of their income on housing costs. That’s good news in a country where many spend upwards of half their income on housing. Still, the median home value in Fremont is pushing $1 million, which means incomes must be equally healthy.

The fourth healthiest market is San Jose, where people spend about 21 percent of their income on housing. Their homes are somewhat more affordable, but still out of reach for most Americans, at $862,800. So again, expect to need a good salary to not be house poor.

For both Fremont and San Jose, homes sell in fewer than 25 days on average, so expect bidding wars if you are buying or selling in those cities. In the 7th healthiest market, though, a home will spend even less time on the market. In Oakland, people spend just over a quarter of their income on housing with a median home value of almost $680,000.

While only three Bay Area cities made it into the study’s top 10, it’s fair to say that those three cities at least partially represent the market as a whole. The housing market here is still healthy, at least for a while.

A Shocking 1/3 Of Bay Area Residents Want To Leave

in Bay Area News, Bay Area Real Estate, Real Estate by Ninja Movers Leave a comment

There are few better places to live than the Bay Area but for some, life can be tough, especially if we’re not millionaires and many Bay Area residents are thinking of leaving.

A survey was done by the Bay Area Council, and 34 percent of the 1,000 respondents said they were thinking of leaving – mostly because of the cost of homes and the traffic. Most of the people who are thinking of leaving have only been here for five years or less, though.

The council, which released its findings Monday, also found that the number of people who say the area is headed in the wrong direction is significantly higher this year over last year: 40 percent versus 28 percent last year.  And 40 percent of those surveyed said the region is on the right track, down from 55 percent.

Source: KTVU

San Francisco residents had a more positive view of the Bay Area, with 52 percent thinking we’re going the right direction. Santa Clara residents are the most dissatisfied.

Here’s the video:

This survey definitely serves a purpose in letting leaders know about people’s struggles and where the area can be improved. Even areas once considered too dangerous, like parts of Oakland and Richmond, are becoming price-prohibitive for many and traffic is tough, but it’s not as tough as in some places.

If you’re one of the people considering leaving our beautiful area, first off, we’ll miss you, but we can also help you. Just give us a call.

The Bay Area Is Mourning One Of Its Greats: Robin Williams

in Bay Area News by Ninja Movers Leave a comment

Williams,_Robin_(USGov)_cropOne of the biggest draws of the Bay Area is the magic. The water, the landscape, the weather – they are all magical, but somehow, so are the people. The Bay Area attracts the best and brightest in the world. From Lucas Films to Pixar to Silicon Valley, the Bay Area is full of magicians; of people who make our lives just a bit brighter. On Monday, we lost one of our magic makers. R.I.P. Robin Williams.

Williams began his career playing an alien named Mork in the 70s hit show, “Happy Days.” His star shone so bright that he was given a spinoff called, “Mork and Mindy.” A megastar was launched.

It’s hard to say if Williams was better known as an actor or as a standup comedian, but he was extremely successful in both endeavors. He had over 100 film and TV credits to his name and starred in big hits such as “Good Will Hunting (for which he won a Best Supporting Actor Oscar),” “Mrs. Doubtfire,” “Dead Poets Society” and “Good Morning Vietnam.”

It was through his comedy where we got glimpses into the sometimes tragic life of Robin Williams. He was open about his battles with drug addiction. His quickness and almost manic style of humor sometimes hinted that there was something darker lurking beneath. Watching him, you almost felt the pressure he felt to always be “on.” Henry Winkler, who starred in “Happy Days,” said this about Williams:

“I just realized my only job is to keep a straight face,” said Winkler, who played “The Fonz.” “And it was impossible. Because no matter what you said to him, no matter what line you gave to him, he took it in, processed it, and then it flew out of his mouth, never the same way twice. And it was incredibly funny every time.”

Source: CNN

President Obama said this:

“Robin Williams was an airman, a doctor, a genie, a nanny, a president, a professor, a bangarang Peter Pan, and everything in between.  But he was one of a kind. He arrived in our lives as an alien — but he ended up touching every element of the human spirit.  He made us laugh.  He made us cry.  He gave his immeasurable talent freely and generously to those who needed it most — from our troops stationed abroad to the marginalized on our own streets.”

Williams’ idol and greatest influence was Jonathan Winters, who died in 2013. Perhaps a light went out for Williams then. We’ll never know the depths of the pain that caused him to take his own life, but the Bay Area is a bit less funny and a bit less magic today.

10 Things You Need To Know If You’re New To The Bay Area

in Bay Area News, Your New Home by Ninja Movers Leave a comment

Sf_skyline_from_bayI’ve been in the Bay Area only about five years and while I absolutely love it here, there were a lot of things that took me by surprise. If you are moving to the Bay Area, your movers can definitely be a great resource, but here are some things that you might forget to ask about:

1. The weather – The weather here shocked me. I knew that summers were rather cool (we’ll talk about that ‘Mark Twain’ quote in a bit) and that winters were warm, relative to most of the country, but I had absolutely no idea that it literally never rained in the Bay Area during the summer. Of course, most of my years here have been during a drought, so it’s hardly rained during the winter, but that’s another story.

2. The traffic – It’s bad. It’s bad during the week. It’s bad on weekends. It’s bad when it’s not rush hour. It’s miserable when it is rush hour. Leave early and listen to books or podcasts or some great music. Don’t talk on the cell phone, though, unless you have Bluetooth, because you will get a ticket.

3. The dress code – What dress code? Yoga pants and hoodies are almost workwear. As a comfort junkie, I do feel right at home, but on rare dressy occasions, I find myself having a difficult time putting a nice outfit together. Bottom line, have a few nice things in your wardrobe.

4. The nightlife – There are so many things to do in the Bay Area, you’ll never run out. There are world-class restaurants. There are museums and galleries. There are clubs. However, unlike New York, San Francisco does sleep. Last call is at 2:00 am. You might have trouble finding places to eat past 9:00.

5. Outdoors – There are few places in the country that match the sheer variety of Bay Area activities. There is a ton of hiking. There’s rowing and kayaking. There’s rock climbing. There are running races and triathlons pretty much every weekend. There’s cycling, but beware, there aren’t as many cycle friendly roads as non-Californians might imagine.

6. Politics – The rest of the country doesn’t know this, but not everyone in the Bay Area is a Prius driving (although there are a lot of those) Democrat. No matter your political beliefs, you will find a lot of like-minded company. But, people do take being environmentally responsible pretty seriously.

7. The history – The Bay Area loves to talk about its history, and for good reason. It’s one of the most culturally rich and diverse cities in the world. The Bay Area was home to greats such as Ansel Adams, Isadora Duncan, Natalie Woods, Bruce Lee, Tony Bennett, Robert Frost, Jack London, and Joe Dimaggio (trust me, the list is far to extensive to include everyone).

San Francisco was one of the few cities that was almost untouched by the Great Depression. One Bay Area city has more dead people than living. Entire neighborhoods are built on top of landfill.

The Beatles gave their last concert in San Francisco. Again, space limits me for all the interesting facts that one can learn about the Bay Area. However, one quote that you will hear a lot as a new transplant is, “The coldest winter I ever spent was a summer in San Francisco,” which is usually attributed to Mark Twain. He didn’t say it.

8. The cost – Everyone you’ve spoken to is right about this one. It’s expensive here. You can save some money by moving across the bay from San Francisco, but even there, it’s expensive.

9. Dogs – Not everyone has one, but they are everywhere. You might as well get one. And, the biggest off-leash dog park is in the East Bay. It’s Point Isabel, which is a gorgeous three (give or take) mile loop along the Bay. The dogs can go for a dip (beware muddy low tide) and they can be cleaned off at the dog wash or you can hose them off yourself. It even has a cafe for you and the pooches.

10. Nothing is as close as you think – Silicon Valley is actually pretty far from San Francisco. Plan on a 30 minutes to an hour or more to get anywhere, even just across the bridge.

 

San Francisco Is Nation’s Fastest Growing Moving Destination

in Bay Area News, Bay Area Real Estate by Wendy Gittleson 1 Comment

 

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Does the Bay Area seem a bit more crowded lately? It’s not your imagination. Despite rising real estate prices, San Francisco is the fastest growing moving destination in the country, at least according to one survey.

While San Francisco is not the top moving destination – that designation almost perennially belongs to Atlanta – it’s moving up the ranks, showing an average increase of 6.9%. The data was pulled by Bloomberg from records from U-Haul.

Penske, a competitor to U-Haul, doesn’t even show San Francisco in the top 10 of overall moving destinations – yet. However, it San Francisco keeps moving up at the rate it is, it might creep onto the list soon.

What other cities are moving up quickly in moving ranks? Nashville is number two. Austin, TX is number three followed by Raleigh, NC, Louisville, KY, Dallas, TX, Tacoma, WA and Denver, CO. Denver is the only city to be both a top 10 moving destination and in the top 10 for growing destinations, although, Tacoma’s neighbor, Seattle, is a top 10 destination.

With the exception of Chicago and Jersey City, NJ, all of the fastest growing destinations are in the South or the West. The all-around top moving destinations show a similar trend, which doesn’t bode well for the Midwest’s or the Northeast’s housing markets.

Graphic of fastest growing moving destinations from Bloomberg.

Graphic of fastest growing moving destinations from Bloomberg.

Facebook Tells Us How Tired We Were After Time Change

in Bay Area News, Menlo Park by Wendy Gittleson Leave a comment
Image from Flickr

Image from Flickr

While you might finally be recovering from last week’s time change to Daylight Savings Time, Menlo Park’s Facebook compiled status updates, and found that as a nation, we were walking zombies.

Okay, ‘walking zombies’ might be a slight exaggeration, but we were tired. Facebook looked for words like, “tired,” “sleepy,” and “exhausted,” and found that usage of each of those words was up on Monday. They also found that the feeling of tiredness wore off by the end of the day – perhaps due to the fact that the sun was still up.

Use of words like "tired" pre-Daylight Savings and post Daylight Savings - courtesy of Facebook

Use of words like “tired” pre-Daylight Savings and post Daylight Savings – courtesy of Facebook

Monday might be an overall tired day, but on March 10th, usage of terms like, “feeling tired” was up a whopping 86% nationwide. Not surprisingly, Arizona, which doesn’t switch to Daylight Savings Time, had the lowest bump, but even they had a 12% bump in tiredness.

Hearty South Dakotans, despite the time change, only had an 18% increase of tiredness, while Delaware was very tired, at 231%. Here in the Bay Area, we weren’t as tired as the Midwest and the Mid Atlantic states (possibly due to the weather), but we were tired.

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Not all was bad, though. While people might have been sleepy, the longer evening put us in better moods.

One might wonder what other effects on mood the shift to DST has. Indeed, despite the tiredness, we see positive effects on the nation’s mood overall. On the Monday following DST, we see +21% increased usage of “wonderful”, and +19% increased usage of “great” compared to the previous Monday. Meanwhile, “annoyed” is down 14 percent and “bored” is down 12 percent. Even the generic macro-feelings of happy (+5.7%) and sad (-4.8%) follow these patterns.

By Tuesday, people were beginning to feel a lot less tired and by Thursday, the effect was almost gone.

San Francisco Second Best City For Women In Business

in Bay Area News by Wendy Gittleson Leave a comment

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Everyone knows that, thanks in large part to the high-tech industries, the Bay Area has a bustling economy. As it turns out, that might be especially true for women. In an analysis from NerdWallet, San Francisco has been rated #2 city for entrepreneurial women.

The study, which measured:

  1. Business-friendliness: We looked at the number of businesses per 100 residents to assess a city’s entrepreneurial climate.
  2. Presence of female entrepreneurs: We took a look at the percentage of businesses that are owned by women to measure how friendly each location is to female entrepreneurs.
  3. Earnings of female workers: To assess the earning potential women have in each city, we used the median earnings for full-time female workers.
  4. Education level: Studies have shown that education correlates with entrepreneurship. To measure the presence of educated workers, we looked at the percentage of residents 25 years and older with a bachelor’s degree or higher.
  5. Economic state: In order to assess whether a city has an economy suitable for entrepreneurial success, we examined unemployment rate.

Washington, D.C. was ranked #1 because of the sheer number of women entrepreneurs. San Francisco has the highest median income for full-time women and the most women-run businesses. Seattle is #3 for being one of the most educated cities. Minneapolis for its low unemployment rate and high number of women-run buildings. #5 is Portland, Ore., for its education rate and number of businesses.

The top ten is rounded out with Atlanta, Denver, Austin, San Jose and Boston.

Just one more reason that we see more people moving into the Bay Area than we see moving out.

Study from: NerdWallet

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