Monoxide detectors: don't forget: it's the law...

If you have a rental property, and if you receive my monthly e-newsletter, you have probably already received about 6 months ago a note about this new law that has passed: you need a monoxide detector in the house as of the 1st of July.

Whereas in your own house, there is little chance to have an inspector come and check you out, you must remember if you rent a property out that it is mandatory.
Typically you would put a CO detector on each level of your house, near appliances that emit carbon monoxide (furnace, wall heater, stoves, etc... although other sources of carbon monoxide include cars - in a garage for instance, and fireplaces).  Where exactly should it go? it is advised to "follow the manufacturer's instructions".

Also, it is good to check with your City: some Cities have special requirements.  Here is the link to the City of Palo Alto smoke and Co detector requirements.

Carbon monoxide is particularly dangerous: it has no color and no odor. 
If you have an old furnace in your home, or a wall heater, you have a risk of having a source of CO leakage.
Detectors seemed to cost at least $45 or $50 about 6 months ago, but it is possible nowadays to find the units below $30.

Do you find this note useful? Forward it to someone you know who might need to read it.
- or "like" it on FB

Thank you, have a great week-end!
Francis

Silicon Valley Real Estate
local resources (schools, Cities, etc...)

In the Valley: sell or become a landlord?

Sell or become a landlord?  That is the question.  A study by Zillow recently showed that more than 1/4 of homeowners considering a move in the next 3 years were considering renting out their home.

This question is being asked more often right now as people either are moving away from the Valley, or want to move up or down to change something to their present lifestyle. 
It is asked more often now that values have gone down from, may be, a high purchase price 3 or 4 years ago.
It is asked more often now that banks do not grant "bridge loans" like they used to, and now that rental prices go up (Nationwide, but also locally), and that it seems like just a matter of time until prices go up from where they stand now (even if it is not doing so like it was in the past 15 years).

To keep a property for ever makes a lot of sense to diversify one's portfolio.  It can and should be, long-term, a part of a retirement account if you already have a lot of money in the banking system.  Down the line, in 20 years, it will seem like impossible to afford to rent the house that today seems so high in price.

Today, as many people loose their property to short sale or foreclosure, they need to find a place to live, and this explains in part why there is pressure on rental prices.

If you are faced with this dilemna, consider the following factors:
- your confidence in the future of home values in the Valley,
- the tax implications, which could be positive or neutral for you depending on your tax situation and income, and the way the property would be managed,
- how comfortable you are with 2 mortgages,
- appeal of that kind of diversification of your retirement assets,
- who will manage the property?
- are you cut out to be a landlord?

Note: if you are moving up or down in lifestyle, the money that you may "lose" in the sale of your real estate asset might be quite equivalent to what you will gain by buying a cheaper replacement property.  So then it is a question of strategizing such a move.  If you are in this situation, contact me and we will review all the options together.

Thanks for reading,
Francis

Silicon Valley real estate news
Smart Market Trends

Time to appeal that tax bill?

Is it time to appeal your tax bill?

It is that time of the year again when the Tax Assessor's Office of the County of Santa Clara sends to all homeowners a notice of the assessed value of their property.

If you think it is too high for your home (it always seems too high doesn't it, since you pay a yearly percentage of the assessed value) you have between July 2 and September 15 to file a review, or an appeal - depending on when you want to contest it.  The specific rules, and the specific dates to check for are on this page of the Santa Clara County official web site.

Where I can help is by providing you with MLS sales data that happened around the turn of the year of assessment.  This is information that you can send to the County in support of your request, along with any other data you may have (that would not be in the Realtors' MLS for instance).

One thing to remember though, as they point out on the web site - and I quote: "IMPORTANT NOTE: It is very important to understand that filing an assessment appeal does not relieve an owner of the responsibility for paying any outstanding tax bill no matter how unfair the owner may feel a bill might be."
.. no surprise there I guess :-\

For the County of San Mateo, the dates when one can appeal the assessed home value are different.  Details can be found on this page: County of San Mateo Treasurer Tax Collector.

Let me know, as always, how I can help!
Francis

Silicon Valley Realtor
Local Real Estate resources

A link worthy of interest: http://www.ourbrothershome.org/

Real Estate Investors Compete Against First-Time Homebuyers.

With regards to this recent blog about investors competing against would-be homebuyers, it has definitely been my experience that this is taking place - in a large percentage of the offers I have seen recenty, especially in the low price ranges. One sure sign: in about 30 to 50% of the cases, the winning offer was all cash.

This is absolutely prevalent where a condominium is offered for sale, and more than 15% of the units in the complex are deficient in their dues payments to the association. In that case, I do not know of a bank that will lend money to buy the property. Only a cash buyer can puchase. Why buy in such a complex, with a fair risk that for lack of funds there will be deferred maintenance all around?  Because the rental income is worth it. And later on, when the real estate market improves, valuations will bring in more gains.  It is clear to me that many (real estate) investors have confidence in the Valley.

But I have also seen it in regular sales, where the dues problem does not exist. With prices very low now in the Valley, investors have been moving in; this has been taking place for at least a year in my experience, - and a little more for houses. Lowest prices were mid-2009.


Francis

Silicon Valley real estate

Sunnyvale prices, since 2006....

Following up on a few of my last blogs on the surrounding Cities, what happened in Sunnyvale in the past 3 or 4 years?

A picture is worth a thousand words. Here is the graph of average prices since 2006, both for houses, and for the group "townhouses and condominiums".

Click to see larger

In Sunnyvale it turns out that values as an average are still down about 11% from 2006 for houses, and about -15% for class 2 - condominiums.

These are averages, for the whole town of Sunnyvale, and a study of specific neighborhoods to see how they fared through the crisis is called for: not all areas went up or down in the same manner. I am thinking that the areas that have good schools probably did better, as is usual in other Cities.

As far as the price per square foot, here is the evolution, for houses:

and for class 2:

The trend is pretty consistent with the average prices of the first graph - though these graphs are only from 2008 on.

For specific areas let me know and I will try to find meaningful graphs and figures.

Thanks for reading!  --Francis

Silicon Valley real estate
Silicon Valley trends
Selected schools page