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If You Plan On Selling Your Home, Do It Now; Here’s Why

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

If you own a home in the Bay Area, congratulations. You own property in one of the most expensive metropolitan areas of the country, but ironically, the cost of real estate now may be why the cost of your home could soon tumble.

san-francisco-918903_1280

According to a poll by the Bay Area Council, millennials are becoming fed up with the high cost of living in the Bay Area. 40 percent of them want to leave. That’s up from 34 percent last year.

The desire to leave the Bay Area was tied to how much of a person’s income went towards housing costs. Among respondents spending 60 percent or more of their income on housing, more than half are planning an escape. Other factors identified by survey respondents as serious include traffic, poverty and income inequality.

One insight the survey revealed was a generational gap in residents looking to depart for cheaper destinations. According to the survey, 46 percent of millennials saying they are looking to leave, leading all age groups. To (Bay Area Council President, Jim) Wunderman, that data doesn’t bode well for future economic growth, especially with big-picture economic indicators like job growth slowing.

“In order to effect meaningful change, we have to signal to the people who live here as well as people who are looking to the region that we’re ready to take on the challenges of making the Bay Area a place that feels like the future.”

Source: San Francisco Business Journal

None of this is particularly surprising. San Francisco is the second most expensive city in the country, just after New York. With average housing prices at nearly $3,500, it’s easy to imagine how people would become frustrated and want to leave our beautiful area.

The good news is, if you have a home, especially a house, outside the city, you might be hit slightly less if millennials start the exodus. Millennials without families tend to live either in San Francisco or in Silicon Valley, and generally in apartments. Still, if you are thinking of selling, now might be the time to do it.

Is Solar Worth It For Your Home?

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

You might now know it now, but California is one of the sunniest places the nation. The Bay Area is also home to some of the most advanced green energy companies in the world. There’s definitely a push to go solar, but is it worth it for you?

solar-power-862602_1280Last week, I wrote about ways to cut your energy costs, and I only briefly mentioned solar, because it’s not very cut and dried. If you are looking just to save money, solar may or may not be for you. If you are looking to save the environment, solar is a great option, especially in California.

The first thing you should do is find out if you’ll even save money. Google has a nifty tool where you just plug in your address and it estimates the savings, if there are savings. When I plugged in my address, it said I would be saving about $400 a year in electricity. It would be more if we added electric heat, hot water and air conditioning units. On average, if your electric bill is north of $100, solar may be the right choice for you.

Buying vs. Leasing Solar Panels

Installing solar panels can be costly. For my house, which is a split level, so it doesn’t have a lot of roof space, the estimated cost of solar panels would be a bit over $20,000 over a 20 year lease term, but if we were to purchase the solar system outright, it would cost about $15,000 less nearly $5,000 in current tax credits (so just about $11,000 out of pocket, which can be financed). If we purchased, it would pay for itself after about eight years. After 20 years, our savings will be about $17,000. Even if we finance, our monthly payments will likely be less than our electric bill would have been. If fact, PG&E could end up owing us money since they purchase any electricity we don’t use.

If you lease solar panels, you may not be able to take advantage of the tax credits and you may not get credit for any electricity you don’t use. So, why would anyone lease when they can buy? Because there’s no maintenance and you won’t pay for installation. Overall, though, your monthly payments will likely be at least a little lower if you buy instead of lease. Either will increase your home’s value, although the leased system would have to be transferred to the new owner.

Featured image via Pixabay.

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

in Bay Area News, Bay Area Real Estate, Real Estate by Wendy Gittleson 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.

Bay Area Named The Worst Rental Market

in Bay Area Real Estate, Real Estate by Wendy Gittleson Leave a comment
Featured image via Wikipedia.

Featured image via Wikipedia.

It probably doesn’t surprise most of us to live here, but if we rent, we are paying out the you know what for just rent. If we own, we’re paying even more. At least those are the findings of Forbes’ annual ranking of rental cities.

The worst city for rentals, according to Forbes, is San Francisco. On average, renters pay $2,800 a month and their rent increases almost 13 percent a year.

MSA: San Francisco-San Mateo-Redwood City, CA Metropolitan Division

Average monthly rent, Q4 2014: $2,802

Year-over-year % change in apartment rent: 12.8%

Median houshold income, Q4 2014: $85,087

Avg. rent as a share of household income: 40% Apartment vacancy rate, Q4 2014: 3.6%

Average monthly mortage payment, Q4 2014: $5,851

Mortgage payment v. rent: $3,049 cheaper to rent

Right behind San Francisco on the “worst” list is Oakland.

MSA: Oakland-Fremont-Hayward, CA Metropolitan Division

Average monthly rent, Q4 2014: $1,815

Year-over-year % change in apartment rent: 10.5%

Median houshold income, Q4 2014: $76,493

Avg. rent as a share of household income: 28% Apartment vacancy rate, Q4 2014: 2.9%

Average monthly mortage payment, Q4 2014: $4,182

Mortgage payment v. rent: $2,367 cheaper to rent

Right behind Oakland is San Jose.

MSA: San Jose-Sunnyvale-Santa Clara, CA Metropolitan Statistical Area

Average monthly rent, Q4 2014: $2,291

Year-over-year % change in apartment rent: 11.3%

Median houshold income, Q4 2014: $93,902

Avg. rent as a share of household income: 29% Apartment vacancy rate, Q4 2014: 3.5%

Average monthly mortage payment, Q4 2014: $5,050

Mortgage payment v. rent: $2,759 cheaper to rent

Believe it or not, New York is behind even San Jose. Their average monthly rent is a bit higher than San Francisco, at about $3,300, but the annual increases are much lower.

METRO (Not an MSA): New York County (NY)

Average monthly rent, Q4 2014: $3,290

Year-over-year % change in apartment rent: 3.4%

Median houshold income, Q4 2014: $74,915

Avg. rent as a share of household income: 53% Apartment vacancy rate, Q4 2014: 2.3%

Average monthly mortage payment, Q4 2014: $7,917

Mortgage payment v. rent: $4,627 cheaper to rent

Rounding out the bottom cities are Los Angeles, San Diego, Northern New Jersey, Boston, Orange County, California and Palm Beach, Florida. I guess we should be happy that California has “only” six of the 10 worst rental markets.

Of course, there’s a reason our rental market is so tight – everyone wants to live here. We have the best weather, the best companies, but biggest variety of recreational activities and the best people.

How To Get The Most Possible Money When Selling Your House

in Real Estate by Wendy Gittleson Leave a comment
Image courtesy of Wikipedia

Image courtesy of Wikipedia

Depending on when you bought your home, there’s a very good chance that you have quite a bit of equity right now. Still, there’s probably a lot you can do to increase the selling value of your home and a lot of them are pretty simple.

1. Clean up the outside – Try to look at your house as if you have never seen it before. If that’s tough for you, ask a friend or coworker to give you an objective opinion. Curb appeal is the first thing new buyers see and you’d be surprised at the number of potential buyers that let that be the last impression.

Do you need to paint or do you need new siding? Even if the siding is in good shape, make sure it’s a neutral color. Personally, I love purple houses, but I’m in a small minority. the same holds true for other more creative shades.

Fill bare ground with ground cover or lawn. Add some shrubs and flowers to the front. Shutters and an accent door add a lot of personality, without being offensive, to the house.

2. Clean the inside – This takes work and will constantly need to be maintained while the house is being shown. Dust and vacuum every single day. Never, ever leave a dish in the sink. Make sure all the beds are made and that each has matching or coordinating bedding – in other words, no two different colors of pillow cases. Make sure the bathrooms have clean, preferably new, matching towels. Potpourri is always a nice touch, as are subtly scented candles. The old Realtor’s trick of baking cookies actually does help.

3. Renovate the bathroom – Bathroom renovations can be anything from brand new spa-like fixtures and tile to new light fixtures and faucets. Regardless of your budget, caulk and add new linens.

4. Renovate the kitchen – Yes, that’s expensive and might not be worth it. Ask your Realtor, but there are some things you can do without spending too much. Paint, scrub your appliances spotless, add a new backsplash. You can even paint your cabinets, which takes about a weekend or two. If you have the budget, knock down walls for an open look and build an island/breakfast bar. Replace your appliances with stainless steel.

5. Paint the inside – Again, use neutral colors.

6. Add an additional bathroom if you have room – Most Bay Area homes don’t have basements, but there are many homes with wasted space. If you can add a bathroom, it should add to the value of the home. Again, consult with your broker and perhaps a contractor to weigh the value.

7. Don’t define rooms for buyers – Some rooms are obvious. A kitchen is a kitchen. A bathroom is a bathroom, but your home office might be another’s playroom. Your TV room might be a home office. Put neutral furniture in those rooms, such as a sofa, chair and maybe a small desk that can double as a plant table.

8. Change light fixtures and buy new bulbs.

9. Add solar – In California, we have plenty of sun and solar rooftops can add thousands to your home’s resale value. It’s best if you go solar before selling your home, so you can benefit from the cost savings too.  A solar water heater is also a great investment.

10. Add hardwood – If you can afford new flooring, hardwood is the most popular option. There are several types of hardwood flooring and there are laminate floors that look like hardwood but aren’t. Gauge that based on your neighborhood. A high-end neighborhood will require high-end flooring. A starter neighborhood may be fine with laminates.

Google Driverless Cars Could Change Where People Move

in Local moving, Real Estate by Wendy Gittleson Leave a comment
Image of Google Car from Wikipedia

Image of Google Car from Wikipedia

Bay Area real estate is notoriously high priced, but still, young, highly-paid tech industry folk are gravitating toward the city centers and close to their places of work. Why drive when you can walk to work or at least to your social life? That could be changing with the advent of Google’s self driving cars.

Some in the industry, though, are starting to think about this potential high-tech reality: Driverless cars like the ones dreamed up byGoogle could ease traffic congestion, parking headaches, unproductive commutes and drunk driving concerns, making it easier to get from point A to point B. The suburbs, once again, could be cool – and not in an Arcade Fire kind of way.

James Kilpatrick, president of the brokerage NAI Northern California, pitched that vision to an audience at the Northern California Apartment Summit on Tuesday. He said on a panel while the idea might sound crazy now, developers need to keep an eye on how new technology will change how cities and the suburbs play off each other. He pointed out how some scoffed at the idea of micro-apartments last decade — only to see those building them make a killing now.

“What we will all look at five, 10 years from now is the how driverless cars will completely change how we think about parking and traffic,” he said. “This will help Oakland’s prominence and this will help Emeryville, and some other East Bay cities because their traffic is so bad.”

Source: San Francisco Business Times

What does this mean for Bay Area real estate and for Bay Area moving trends? It means that location will stop mattering as much. A two hour commute isn’t so bad if you can sleep or work through it.

It will be a while before people start leaving the urban centers for the burbs, though. While Google’s cars are legal, it’s not expected that they’ll be widely embraced for another few years, but it might not be too early to snap up the relative bargains in the suburbs before everyone else catches on.

You Want San Francisco’s Hottest Neighborhoods? Follow The Bus

in Bay Area Real Estate, Real Estate by Wendy Gittleson Leave a comment
Image of Google bus protest from Flickr

Image of Google bus protest from Flickr

If you are looking for a place to live in the city of San Francisco, you likely fall into one of two camps – you are either looking for the hottest, best location or you are looking for something that resembles affordability. If you are among the first, you might want to throw away your outdated guide to San Francisco and head to the nearest Google bus stop.

Chris Walker, who grew up in Union City, but lives in Mumbai, India, where he works in international development, mapped the places where the Google shuttle stops to economic development. He found that the areas around the Google bus stops were the most prosperous.

“San Francisco has always been a really expensive place to live, but I wanted to see if these neighborhoods had become even more gentrified and affluent with the arrival of all these tech workers who commute to the South Bay,” said Walker. “Broadly, I think the data does show that.”

As Walker sees it, technology companies stationed their bus stops in fun, hip neighborhoods where their young workers were increasingly moving. Those new residents, with plenty of disposable income, prompted more new restaurants, cafes and bars to open – drawing more tech workers, raising housing prices and luring more new businesses.

Source: SF Gate

The shuttles don’t only belong to Google. Apple, Yahoo and Facebook all hire private shuttles to pick up their San Francisco employees and take them to their Silicon Valley and Peninsula offices. The hub is the Mission and the shuttles service the Castro, South of Market, North Beach and more.

 

Not all is happy in Google shuttle areas, though. The average tech shuttle rider is young, male and earning six figures. Not only are the shuttles changing the looks of the neighborhood, but long time residents are being pushed out, due to rising rents and rising property taxes. This is causing a lot of tension, but even for those who are staying, many feel they are losing the neighborhood feel and cultural diversity.

The tech sector did not create the problem of inequality in San Francisco. The city has long been among the most expensive to live in America. But by gravitating towards certain neighborhoods, tech sector workers amplify and accelerate the gentrification process that was already happening there. They feed into the clusters of affluence in much of the northeast corner of the city, which has led to a recent uptick in evictions and several protests over affordability.

Source: Datawovn.com

Click here if you are interested in seeing the neighborhoods where the shuttles stop and their concentration of cafes and restaurants.

Property values and gentrification aren’t the only issues the Google busses are facing. Residents are complaining about traffic congestion. The city is holding open houses on February 10th and 22nd to determine if the neighbors should have a say in where the busses stop.

Is The Tenderloin Really The Worst Neighborhood In San Francisco? (VIDEO)

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

800px-Tenderloin_Street_Chess,_SF,_CA,_jjron_26.03.2012The Tenderloin, about 50 square blocks near one of San Francisco’s most posh neighborhoods, Nob Hill, is often considered the worst the city has to offer.

While the Tenderloin is probably not the best neighborhood to raise a child – the neighborhood is riddled with drug addicts and the people who serve them, prostitutes, gangs, guns and many homeless people. However, if you are young and adventurous, the Tenderloin offers a vibrant lifestyle and about the closest you might find to affordable in the city of San Francisco.

This video, by Benjamin Jenks, lovingly shows you the real Tenderloin, both the good and the bad.

While it’s still possible to find living accommodations in the Tenderloin for around $1,000 – $2,000 a month (although you are still looking at a minimum of about $500,000 to buy), the neighborhood might still be too raw for some people. If you want a compromise between the vibrancy of the Tenderloin and the staidness of Nob Hill, you might check out the TenderNob – located right where the two neighborhoods meet. Realtors might just call the neighborhood, “downtown.”

The Tendernob is hipper than Nob Hill and safer than the Tenderloin.

For a longer and more comprehensive look at the Tenderloin, watch this video by Matt Granger (some offensive language).

Government Shutdown Could Delay Your Move Indefinitely

in Real Estate by Wendy Gittleson Leave a comment

 

If you aren’t employed by the government and you have no plans on visiting national parks, it’s easy to think the government shutdown won’t affect you, but if you are trying to move into a new home, it might. Because the IRS is one of the agencies affected by the shutdown, your mortgage company might not be able to approve your loan.

The government shutdown could derail Cristina Bravo Olmo and Brett McBee-Wise from buying their dream house, a 99-year-old Craftsman in Rockridge. Before the sale can close, Bravo Olmo must finalize the sale of her one-bedroom condo in San Francisco’s Hayes Valley to a buyer who offered a bit more than the $699,000 asking price.

“We went through all sorts of inspections for the place and finally got over that hurdle,” Bravo Olmo said. “We thought the stressful part was behind us.”

But then came the shutdown.

“That put the brakes on,” she said. “The buyer cannot get her loan processed because her lender requested IRS documents and there is no one there to provide them.”

Source: SFGate

The holdup was because of a single document from the IRS – the 4506-T tax verification receipt to verify the buyers’ tax returns. The IRS is also used to verify Social Security numbers.

First-time home buyers will also be affected. The Federal Housing Administration is operating at a skeleton staff. Some lenders are authorized to issue FHA loans without the agency, though.

Even more potentially wide-spread for Bay Area buyers, though, is the fact that the Federal Emergency Management Agency is closed. For those looking to buy a home in a flood-prone area, FEMA’s closure could prevent buyers from getting flood insurance, which may be required to close the loan.

Rural home buyers will also be affected. The Department of Agriculture, who provides loans for rural properties, is also shut down.

Fannie Mae and Freddie Mac are running as usual, but with a bit of a risk. If, after the government is open, they find out that the borrowers’ documents don’t match IRS records, they might have to repurchase the loans.

The longer the government is shutdown, the longer it will take to deal with the impending backlog of requests – potentially delaying closings by days, weeks or even months.

Some sellers are delaying putting their homes on the market until the government is back up and running, since the pool of potential buyers is dwindling to those who have cash in hand.

 

New California Program For First Time Home Buyers

in Real Estate by Wendy Gittleson Leave a comment

If you are looking to buy a home, but are finding the down payment requirements a little daunting, there may be some assistance available to you through a new program in California.

The California Housing Finance Agency (CalFHA) is offering a new fixed-rate mortgage program with no-interest down payment loans for first-time home buyers. The best thing about the loan is that you don’t have to pay it back till you either sell your house, refinance it or pay it off.

The loan is capped off at 3.5 percent, which is the minimum down payment amount for an FHA loan. Further assistance might be available through the California Homebuyer’s Down Payment Assistance Program, which can provide up to an additional 3 percent of the home’s value.

Still, with median home values in the Bay Area capping half a million dollars, first time home buyers might not be left with a lot of options.

But that doesn’t mean you’ll be out in the cold. As median real estate prices in San Francisco have now risen above $1 million, city renters are fleeing across the Bay where prices might not be that much cheaper, but you get more space for your buck.

Christine Englund and Dean Charlton migrated from the city to the East Bay because she got a dream job in San Ramon.

“Our house in West Portal is in one of the foggiest neighborhoods in town; 2 miles up from the ocean, you’re totally socked in for the summer,” Englund said. “It’s a two-bedroom one-bathroom, with a little yard, just 1,500 square feet.”

Listed at $799,000, the house got 12 offers and sold in late May for $1.025 million. “We hit just the right time,” Englund said. “Interest rates were still a bit lower than now and inventory was so tight in San Francisco.”

Source: SFGate

You can get even more bang for your buck if you move to less family-friendly, but economical parts of Richmond or Oakland.

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