Is it a condo, is it a townhouse?

Is it a condo, or a townhouse?

If you are wondering if you are looking at a condominium, or a townhouse, it may not always be so obvious: many condominiums do look like townhouses, with 2 stories and even a real enclosed garage attached (as it is the case in this complex: the Old Mill in Mountain View).

A condominium is a unit inside of a larger complex, where the owner owns a small part of the whole
complex. It is also said that in a condominium, you own "from the paint on", meaning that the rest is owned in common.  For instance if there are 100 units, you would own 100th of the whole property; many times it includes several buildings, the land, the pools etc...  So in a way you do not really own where you live, you own a portion of a much larger property.  Of course you have exclusive use of your location, and also the exclusive use of a parking space, a balcony, a storage area.  The legal description (shown in the preliminary title report) indicates that it is a condominium.

In the case of a townhouse, you own the land you are on, and the house which is on it, and typically you are responsible for the maintenance of the whole place: you have to pay to repair or change your own roof, you have to paint the home, you take care of your own stucco, garden, fences etc...  If you have rules that limit what you can do, it would be because of the association that regroups all the townhomes around you, which might be responsible for the walkways, the access roads, the common facilities (pool, tennis etc...).  Those rules help keep a common look and living experience to all the homes inside the complex.

In many areas, especially where there is very little land to build on (think "the Bay Area"), the exact definitions get blurred, and you can have homes that may look like townhouses but are in fact condominiums.  So be careful and ask your agent to double check on that for you (in the preliminary title report).

Even though it is always good to "own your own land", lifestyles change, and many buyers prefer that an association take care of the roof, fences, pools, paint, and so on.  A condo can be better for that.  The "association dues" are meant to be used for those repairs, and often a management company takes care of them.

Also, if you are considering a purchase soon, be aware that the financing on condos will not be as easy or cheap as for townhouses, which are considered "houses" by most lenders.

I had written a blog in 2010 on the subject of condominiums, with an updated page on condominium details and explanations, which you may be interested in checking out ....

Thank you for reading,
Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A worthy local non-profit to remember: Community Services Agency in Mountain View

California real estate: to keep in perspective...

To keep in perspective:

- California's largest gain in annual median price was in 1977: it went up 28.1% from 1976.

- California median price was $3,527 in 1940, and it was $447,010 in 2014.

- The largest decline in annual median price was in 2008: it dropped 37.8% from 2007.

- Between 1968 and 2014, the median price for single family homes has increased at an annual rate of 6.6%.
Source: California Association of Realtors.

Local Inventory:
In the County of Santa Clara, the number of houses and condominiums on the market went up to 7000-7500 in 2008.
By contrast, it was around 700 to 800 in the first few months of 2015.
This is an essential element of the real estate market locally, and the fact that it is currently (as of the last week of September) at around 1680 is also important: it is a relatively better time to look at buying a property than at the beginning of the year.  The inventory has been steadily increasing.

Thank you for reading!
Francis

 

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Second Harvest Food Bank

Median Sales Price - Santa Clara County - Good time to buy now?

Median sales price in Santa Clara County: is it a good time to buy now?

The time is about right now for an update on this fairly important matter, especially for buyers who have been in the market to buy for a while, or are thinking of making a move in the near future.
My last post on the subject, "the ratio of sales price over list price", and last year's post in September "the evolution of average prices" provide some perspective on this (as well as an article last week end in the SF Chronicle, BTW).

Below is the graph showing the monthly change in median price for all homes (houses and condos) sold in the County of Santa Clara, since the beginning of last year (2014).  On this graph we see the median price, and not the average price.  "Median Price" means this: the same number of homes sold over that price, as the number that sold under that price. But one can see that either way, the trend is similar to the one that the average price followed last year.

All in all, it means that it is statistically a better time to buy during the last months of the year than during the first six months of the year, when prices go up - because more people are looking, and need to buy during those months, to be settled in for the next school year.  Probably it also means that fewer people are looking to buy as we get closer to the winter months, and the Holidays.  It can also mean that the homes that sell during that time are in general less expensive than during the first 6 months (smaller homes may be?).  It is not a definitive call that a house will be bought for less money all things considered, but it certainly is worth keeping in mind the seasonal trend.

One last remark on the subject: the trends in years past are a lot more pronounced.  In the past 2 years, or so, the market is such a sellers' market that the slowdown in the market is just mild towards the end of the year.  One should remember that it is still very much a sellers' market, and that there continues to be a strong competition among buyers for the nicest homes.  But my experience has been that buyers are less stressed when buying a house closer to the end of the year.

Thank you for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

A worthy local non-profit to remember: Community Services Agency in Mountain View

Investing in Real Estate - Where is it best?

Investor clients often ask me where it is best to invest in real estate, in the U.S.

This is a tough question, and there is no easy answer: it depends partly on the circumstances and needs of the client, whether the investor wishes to manage himself/herself, where you believe the best prospects for appreciation are, opportunity, future family needs?...

RealtyTrac puts out a good study on their web site (see "RealtyTrac study on rental condition") showing that the best performing markets for rental returns are:

Baltimore, Maryland:  24.82%, followed by:
Clayton, GA with 24.26%,
Wayne, MI: 21.08%,
Pasco, FL: 19.2% .....

The markets with the lowest return on investment are:

New York County, NY, with 2.34%, followed by:
San Francisco County, CA: 3.2%,
then Kings County/Brooklyn, NY: 3.63%,
Marin County, and close behind San Mateo County and Santa Clara County, at 4.31%
... and Santa Cruz County at 4.54%

Return on investment is defined in this study as gross return: rental price divided into the purchase price.  There is a lot more that goes into a more real "net" return: you have to take into account expenses, which include such costs as: - management company, - repairs, - vacancy, - taxes & insurance, - wear and tear on the house etc ...  More on this subject with this "net operating income" link, noted above.

This study does not look at the rental market from the point of view of someone who has owned a place there for a long time, just someone who would be buying right now, in the market as it is currently.  What I mean is that it does not take into account the appreciation of the asset in that location over time.  This can be a strong factor in the buying decision, and an unknown in the future.

Thank you for reading,
Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Coalition on Homelessness, SF - ArtAuction15

Los Altos Below-Market-Housing Update

Los Altos will soon have 17 additional BMR units:

As read in an excellent recent article in the Town Crier by Staff Writer Alicia Castro, Los Altos will soon have 17 additional below-market-rate apartments at the "Colonnade Los Altos" at 4750 El Camino Real (in front of the recently remodeled San Antonio shopping center).  Currently the City has 105 affordable multiple-family BMR units, including 32 rentals and 22 senior units, and 44 second-living units, according to the city's planning services manager, David Kornfield.

 

The requirements for people applying for these below-market units are as follows:

“Very low income” requirement is $37,250 for 1 person to $57,450 for 5 people.  “low income” requirement limits the range from $59,400 for 1 person to $76,400 for 3 people. (based on the County’s median income of $106,300 for a 4-person household).

 

The deadline for preliminary applications was extended to the end of July 2015 in order to allow more eligible applicants to participate.  Preference is given in the selection process to salaried employees of the city, the schools and fire department serving Los Altos residents.  Some preference is also built-in the selection process for Los Altos residents and workers.

More info on this subject in the Town Crier of July 8, 2015.  To submit a preapplication for the lottery process, and for full details on the program, go to: www.leaselosaltos.com/affordable-housing-information  

 

Francis

 Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Bay Area at Forefront of a National ‘Rental Crisis’

Bay Area at Forefront of a National ‘Rental Crisis’  - A Zillow report  followed by an in-depth view of the current market in the Bay Area, area by area.

There’s no doubt that Bay Area home prices have been climbing steadily since the recession, but as it turns out rental housing costs are going up even faster and it is creating what Zillow calls a national rental crisis.

Rents all across the country are going up faster than home prices, and they’re going up in our region faster than anywhere in the U.S., Zillow reported in its latest rent index.

In the five-county San Francisco metropolitan area, the Zillow Rent Index soared to $3,162, up 14.9 percent in April from a year ago, the fastest increase in the nation. And who was number two? The San Jose metro area, where the Zillow Rent Index rose to $3,287, up 12.9 percent.

Denver, Kansas City and Portland rounded out the top five rental markets with the greatest price increases. Nationally, the Zillow Rent Index rose 4 percent in April from a year ago to $1,364. The rent index is the median monthly rent “Zestimate” of all properties in a region, not just those for rent.

While home prices have moved up and down over the past decade, Zillow said that rents have been rising steadily during that time. In April, rent increases nationally outpaced home-price appreciation for the first time in years, accelerating what Zillow called a “rental crisis.”

In the San Francisco metro area, rents started rising faster than home values in July 2014, according to the report, and they have been growing faster ever since on an annual basis.

The report added that a slowdown in home-price appreciation will help renters looking to buy a home in much of the nation.

See the rest of the story there:  The "Coldwell Banker Market Watch".

Thank you for reading,

Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Community Services Agency

Fix small issues before you put your home on the market.

Fix Small Issues Before You Put Your Home on the Market.  

Thinking about selling a property? It is always better to prepare well, and part of the preparation involves doing some repairs in the house that will bring a good return on the investment.

One question that always comes up is whether it is better to do the repairs before or after doing the inspections.  You can do it either way, but I personally like to have the inspections done ahead of time.  There are 2 advantages:

1/ you have a list that you can give to a contractor, so this part is easier to deal with: you just highlight what you choose to address,

2/ you can annotate the inspections later, and show to the buyers what you have done to make it easier for them to move in.  I find that this is something that my clients buyers like a lot, and react well to (unless they do prefer to do the work themselves).

In general, and it depends on the market you are in, and the type of property you are selling, it is best to repair some of the following items, because it is often much less expensive than one thinks and will bring in a much higher sales price, by showing the house has been cared for:

-       Small plumbing items (leaky faucets, frozen valves, missing P traps …),

-       Painting, (which typically includes repairing cracks, and holes),

-       Small electrical items (broken GFCI outlets, broken cover plates…),

-       Small termite damage, and possibly larger ones depending on the cost and ease,

-       Hard to operate or broken locks,

-       Small roof repairs,

-       Window / door adjustments,

-       Ventilation screens,

-        And of course a large dose of cleaning (including windows and appliances).

As a seller, you also have to think hard about addressing safety items (think “gas, water, and electrical”) - anything that is currently noted as a safety hazard by the inspector.

In my experience this translates into a much higher final sales price.  Either because the buyers do feel better about the property and have fewer questions about its condition (hence a higher offer price) or because, more importantly, it brings another buyer to the table.  We all know that this simple "little" fact can add tens of thousands of dollars to the sales price.  

thank you for reading,

Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Community Services Agency

How can your agent show you properties....

How can your agent show you properties…

 

When you are an agent, it makes sense to work with buyers as well as sellers: if you do your job right, the buyers of yesterday will be your clients sellers of tomorrow.

And to be sure your clients buyers will be as happy tomorrow as they are today following their new purchase, I believe that your job while showing properties is not so much to “sell” the house, but to “inform” the client about the house. 

What is important in my mind when I show a property is to point out to the client what he/she would otherwise not see, and to inform them about things they would not think about.  While I remind my client that I am not a negative person, I will most likely point out negatives that they otherwise would not notice.  The positives? I trust the client to see them, and know why they like the place.  The clients are the ones knowing best what is good for them, what they need or like in a property.  On the other hand, they may not notice some less desirable features in the house or the surroundings. 

 

I think the term “salesman” has been wrongly attached to the profession, and I do my best to counter that impression: I am here to help clients purchase the best house for them, not to sell them anything.

 

When I was a young agent, my mentor used to say: “a house is like a boat; as the captain, you just want to know there is a leak if there is one”. The leak in itself is not necessarily critical.

What are red flags that may not be apparent to a new home buyer?

-       Cracks.  All cracks are not made equal  ;-)  Some are more worrisome than others. Although an agent cannot give an opinion on how serious cracks may be, unless he/she is also a contractor or a specialist, some things statistically will be more problematic than others.  Cracks like other defects need to be pointed out and referred to a professional inspector (who in the end is always the one to give a professional opinion to the buyer).

-       Puddles near the foundation.

-       Sticky doors or windows - probably a sign that the structure moves. 

-       Flickering lights,

-       Uneven floors,

-       Black stains on walls, floors, windows…

-       Missing or displaced shingles on a roof, etc…

 Any experience you’d want to share? I would love to hear your experience!

Thanks for reading,

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates
A place worth noting: Our Brother's Home in MountainView

Real estate: the misunderstood "as is" clause.

Real estate: the “as is” clause.

In my experience, the iconic "As Is" term is largely misunderstood, by buyers and sellers equally.  This is where your (professional) agent may save you money, and hopefully some mistakes.

“As Is” merely means that the seller and the buyer accept the fact that the seller is not obligated to correct anything at all. The seller still has to fully disclose everything that could affect the value or the desirability of the property (any negative aspect of the property, past present or future - if known) - unless the seller is exempt. “As is” does not relieve the seller of his/her legal disclosure obligations.  Also, at a different level, in most contracts the property has to be, at close of escrow, in the same general condition as on the date of contract acceptance; so, if something is damaged after the contract has been signed, the seller would most likely be obligated to correct it, even if it is an "as is" transaction. - or the buyer may cancel, possibly.

In the past, when the market was different, I would often advise a seller to contractually limit any and all liability to a certain amount, after the buyers had done their inspections.  The buyers could ask for certain repairs, but at least this way the seller did not have to go over that limit if that had been negotiated in the contract.  Today, the "as is" clause would mean that the limit placed on the works possibly done to satisfy the buyers would be zero dollars.  That's as simple as that.  If the buyer has a contingency, the buyer can always ask for something to be corrected, repaired, replaced…. Depending on how the contract is written, the buyer then may be able to cancel the purchase if the answer is not what (s)he likes.  The sellers could always agree to some repairs, why not, if they otherwise are happy with the end result. But they don't have to.

New homebuyers are often scared by the term "as is", and they should not.  I have found that when something big pops up that was not known upfront, both buyers and sellers are willing to work together to address it.  Of course, market conditions will play a large role.
A contract is a living thing: things change during a transaction, new stuff is found, other inspections may happen, and items which were acceptable yesterday may not be acceptable today. “As is” is not the end of the story. It depends a lot also on the other terms and conditions negotiated in the contract.  Knowing the real estate contracts and their subtleties is one of the most important criteria in your choice of an agent to represent you.

And when you sell a property, disclosing as many things upfront as possible is a good strategy: it seeks to remove the majority of the unknowns, and makes it a lot more possible to go into an “as is” contract that is meaningful for both sides.

Thank you for reading,

Francis

Silicon Valley real estate

Trends: Local prices and graphs.

A noteworthy local event coming up:
The French Fair, March 21, 2015

California State drought situation.

California is in a deep drought, as evidenced on this map of the state of drought in the US, from the NIDIS web site (National Integrated Drought Information System).  It is not going to go away.  Knowing where we waste water is useful:

Thanks for reading,
Francis

Silicon Valley real estate

Trends: Local prices and graphs.
The total yearly stats, locally by City, for 2014.

Note: our next free E-Waste collection and shredding event will be on: Sat. 4/11/15, at our Coldwell Banker office at 161 S. San Antonio Rd, Los Altos. Times: E-Waste 9am to 3 pm. Shredding: 10 am to 2 pm (or until our truck is full).

Owning a home - the Consumer Financial Protection Bureau.

Thinking about owning a home one of these days, even if it is not going to be very soon?

A good way to start is of course to talk to a Realtor® (not just a real estate agent).  A Realtor® is a member of the National Association of Realtors®; he adheres to a very strict code of ethics. Not all agents are Realtors®!

Some of us however like to do some research first, investigate and read about a subject, and be comfortable before making a move. 

A very good place to start, which is not very well known, is the Consumer Financial Protection Bureau which was created right after the 2008 financial meltdown.  Their “Owning a Home” page is really comprehensive, full of essential information about the whole process.  It touches on the financial aspect of the journey to owning a home (loan options, rates etc…) to the actual procedures of closing such a transaction.  By the way, these procedures include new documents and disclosures  that will be taking effect on August 1 of 2015.  The old closing documents and forms will be shelved.

In the financial part, you will see that no one can quote you a rate right off the bat, without knowing a good deal about your personal situation.  So, when you read about that fabulous rate in the paper or in an ad, you’d better be careful, - it is probably for the cleanest, richest, ideal top-credit-rating person   My advice is rather to choose a loan agent whom you know will look out for the best loan for you when the time comes (not necessarily the cheapest).  You will also see that depending on the type of loan, you can borrow more or less…
that walked on the surface of this earth.

As far as the details on the procedures, paperwork, customs and uses, and the most efficient ways to go about doing your search and purchase, I’d go back to your Realtor® of choice - the one whom you know will look out for your best interest.

Thanks for reading!

 

Francis
 

Silicon Valley real estate

Trends: Local prices and graphs.
The total yearly stats, locally by City, for 2014.

Note: our next free E-Waste collection and shredding event will be on: Sat. 4/11/15, at our Coldwell Banker office at 161 S. San Antonio Rd, Los Altos. Times: E-Waste 9am to 3 pm. Shredding: 10 am to 2 pm (or until our truck is full).

Properties off MLS...

Properties off MLS…. controversial.

 A lot has been said and written on the subject of properties selling “off MLS”, meaning they have not been on the Realtors’ Multiple Listing Service and were sold before making it to that database, common to all Realtors.

 Coming from a country where a common database of properties for sale is nearly non-existent, I can definitely vouch for the huge benefits that such a common database offers, both to buyers and to sellers. We could go on and on describing those benefits, but let’s just say that it pretty much ensures that a property for sale, by virtue of being exposed to all the agents around, will sell for its real, highest market value (low, high, but the most accurate result of supply and demand).  Also, a buyer will find all that is available for sale in one place, which means more choice and less wasted time going from one provider of information to another provider of information.

 So, why sell a property “off MLS”?  There are some unique situations where the sellers do not want the whole public to know that they are selling, and that is understandable.  There will always be special circumstances (i.e. very high price range, specific sellers’ needs or preferences, etc..).  But these exceptions aside, I see mostly downsides to not offering a property for sale through the MLS:

-          Less information for buyers and sellers about current sales activity, and "comparables". How do you price a property if you don’t know how, and how much similar homes sold for? This information is easily accessible (and reliable!) in the MLS.

-          A situation where both the seller and the buyer are “gambling”; one gambles that he/she bought for a lower price than if the house had been offered to all potential buyers, the other one gambles that he/she sold for the best, highest price.

-          A lack of confidence by the clients-buyers that they are being treated fairly: after looking for a home for several months and missing out on several offers, a buyer is not happy to learn that “that” house was for sale, but (s)he did not know about it,

-          The creation of smaller entities, or “channels”, where such properties are “known” or “available” to select agents and their clients; again, this is going back to a system without a reliable common database for all, and in my opinion does not serve the public well. Indeed, even those agents may be unaware of some other offerings in a different channel, and their clients will miss out on those opportunities.

 The practice of selling real estate through an MLS is not perfect, but it is the result of an evolution, and it is immensely practical and fair, and someone coming from a system where it does not exist sees it right away.  As an agent, I keep close tabs on all channels showing properties available for sale, even “off MLS”.  But using “alternative channels” excessively undermines the MLS, and I am afraid this will make it more difficult and unpredictable for the public to find or sell real estate – and a lot less efficient.

Let me know what you think!
Thanks for reading,

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Property sales price is public.

Up until the end of 2014, property sales prices could be withheld from public records.

If someone selling a property did not want the sales price to be disclosed, they just instructed the escrow officer to show the transfer tax amount on a separate page from the Grant Deed (the Grant Deed is public record).

Since January 1 of 2015, this is not going to be possible any longer: the hidden tax form will no longer be accepted by the County Recorder, regardless of when the documents were executed.  The tax amount will have to be shown on the Deed.

What newspapers do when they publish the recent real estate activity is this: they calculate the sales price from the Transfer Tax (when shown on the public document), and show the final sales price.  So from now on, it will not be possible to hide the sales price...

Thank for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates
A place worth noting: Our Brother's Home in MountainView

Silicon Valley real estate: ratio sales price/list price - end of the year inventory.

The number of properties available for sale is always smaller around the first of the year, and the market less active as the Holidays take people to other places, both in their minds and physically.

This year for the area covering the five cities of Los Altos, Los Altos Hills, Mountain View, Palo Alto and Menlo Park, we start the year with a total inventory of homes for sale of 37 (24 of those are over $2 million).  This total includes houses, and condominiums/townhouses.

As a comparison, last year we started with a total of 51 properties.  This, coupled with the huge activity I see at open houses, indicates that for a foreseeable future there is a large imbalance between the number of buyers and the number of sellers.

For the area covering the whole County of Santa Clara, we start the year with a total number of properties for sale at: 606…  Last year, we had 751 homes for sale at the beginning of the year.  Even though many areas are not as extreme as around Los Altos and Palo Alto, we still see a strong sellers’ market out here, especially in the entry-level / lower price range.

My monthly market update, accessible in a detailed form on my local newsletter, shows that the average ratio of sales price over list price is lower towards the end of the year (this graph is for the County of Santa Clara):

These are two facets of the local market around the New Year: statistically, properties sell for less of a premium, but the fact is that it is still a very strong sellers’ market.  Many clients ask me why and the answer is not straightforward.  I think that it reflects on the fact that over large numbers, statistically, there may be more properties on the market that must sell, as compared with the rest of the year.  It may also reflect on the fact that the quality of the real estate offerings is lower, and/or there are fewer buyers looking.  Remember, these are statistics.  However what it does not mean is that a desirable property, in a desirable area (schools, prime location etc…) will sell for less, if there is not a “time pressure” factor involved.

Any input on this?  Do let me know,

Thank you for reading,

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Foreign investments in the U.S. real estate market.

Foreign investment in the US real estate market.

Year-in year-out Realtors in the Bay Area deal quite a bit with foreign buyers.  It is interesting to keep some perspective on this phenomenon at the national level.

From March 2013 to March 2014, foreign purchases in US real estate increased 26% from the year before, to a total of $92.2 billion (National Association of Realtors Profile of International Home Buying Activity).

4 states accounted for 55% of the total: Florida, California, Arizona and Texas.

Nearly 60% of reported international transactions were all cash, compared to just one-third of domestic home purchases.  - Still 1/3 is an impressive number!

54% of all international transactions last year came from Canada, China, Mexico, India and the U.K.
Clearly, the United States remain a destination of choice for investors for its stability, and future prospects.

Separately, but still relevant to this subject, it is good to note that the foreign-born population by state looks like this:
- California: 25.4%
- New York: 10.8%
- Texas: 10.4%
- Florida: 9.2%
- the rest (~44% ) is divided between the other states.

Do you have an input on the subject?  Please let me know.!

Thanks for reading.

Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Coalition on Homelessness, SF

Getting a new loan - things to do and not to do....

Are you getting a new loan?  Here are some tips of things to do and not do, in order to facilitate the procedure.  Some are essential, while others are more subtle.

-       Always pay on time:  your payment history is one of the biggest factors in your credit score.

-       Monitor your credit regularly:  make sure you stay on top of your credit history. Be sure to check all 3 credit bureaus annually to make sure there are no errors.

-       Know your credit limits:  being close to or maxing out your credit limits may negatively impact your credit score.

-       Set up alerts, do not be late.  Set up email and text alerts, as well as auto-pay, to help ensure that you pay your bills on time and build positive credit history.  The first missed payment has the largest impact on a credit score, so don’t miss payments. If you are late, don't be 30 days late, and if you have difficulty, call your lender - often time they can work with you.

-       Do not do charge anything unusual on your credit card - no cars, no motorcycles - do not increase your debt ratio as you are trying to get a new loan. 

-    

Beware of moving debt. Be wary of moving around debt repeatedly - you need to pay debt down to improve your credit score. Also beware of moving large amounts of money during the loan process, unless you can document it thoroughly.

-       Know your debt-to-income ratio.  Lenders look at the amount of debt you have compared to your monthly income   - it’s good to keep that under 35%.
   

-  Good scores = Good rates:  better credit scores in most cases get you better credit interest rates.

-       Don’t open too many accounts: opening up a bunch of credit accounts you don't need may negatively impact your credit score.

-       Keep balances low:  keep balances low on credit cards and other revolving accounts  - this may help your credit score.

-       Think before closing accounts.  Closing credit card accounts may lower your available credit and could hurt your credit score in the short term.

-       Length of your history matters.  Lenders care about the length of your credit history because they want to see that you can manage credit accounts responsibly over time. 

-       Finally: know that others view your credit.  Landlords, public utilities, and potential employers may review your credit history, in addition to lenders.

I always tell me clients: when it is time to apply for a loan, follow closely the instructions of you loan agent, and in doubt: ask the question.  They know best what the underwriter is going to scrutinize, what works and what does not work.

Do you have an input on the subject?  Please let me know.!

Thanks for reading.

Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Coalition on Homelessness, SF

Revoking a real estate counteroffer.

The life of a real estate purchase offer....

Sellers may be in a situation where they receive what they think is an acceptable offer, one that they wish to work with, and then proceed to counter that offer.  What happens if, prior to acceptance by the buyers, the sellers get another better offer.   Are the sellers trapped? 

No, the sellers may revoke that counteroffer, as long as it is done in due time.  The definition of "due time" and "properly done" can get technical, and a little too involved for this current blog.  If it is not explained carefully by your agent, and if it is not carefully documented, it can be a costly matter.

But the reason for this blog is not to explain the above, it is to stress that many buyers, (improperly informed by their agent), think they can take their time to respond up to the expiration of the time stated on the counteroffer. That period of time however can be cut short by a seller's revocation of their counteroffer prior to the buyers' acceptance and delivery.

Buyers should be aware that the clock is ticking on their response from the time they have received the counter offer, and that they may not have until the expiration to respond.  Buyers who are eager should, therefore, get their response back to the seller as soon as possible after they have received a counter offer - before any revocation can occur.

Hot markets create situations that agents do not usually encounter in slower markets.  It is important to have a knowledgeable agent on your side to keep you informed of your options, and pitfalls to avoid.  The decision is always the clients' to make in the end, but it is important to understand the rules of the game - and I prefer to say, it is important to precisely understand the language of the counteroffer that is given to you. This is where your agent can save you a lot.

Thank you for reading,

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Buying a home, second thoughts...

Many recent homebuyers would make different choices if they had a second chance, according to a study commissioned by JPMorgan Chase & Co.

New homeowners say they wish they had done more homework at the outset of their home search and purchase process.  Nine of every 10 buyers felt prepared when they bought their home, but in hindsight, 56% wish they were armed with more knowledge about the financial aspects of purchasing a home, such as the closing process (22%), making an offer and negotiating (19%) and financing (15%).

Many recent homebuyers were surprised by how long the home-buying process took:  40% say it took longer than they expected.  And while more than 80% of buyers had considered their home move-in ready, 76% have done or are planning to do renovations to their home in the near-term.

Two thirds of recent homebuyers sought advice from real estate agents, the study finds.

"While consumers said they felt prepared to buy a home and were satisfied with their home purchase, our results found that there are challenges and areas for improvement," says Lisa Foradori, chief marketing officer for Chase Mortgage Banking.

Many Realtors come from the teaching profession, and there is a good reason for that: to be a good agent, one needs to have a passion for explaining why and how things work during the buying (or selling) process.  And even when clients have bought real estate in the past, they need someone on their side who knows what has changed recently, both in the market place, and in the profession (new forms, new rules and laws, new tools).    I always advise my clients to work on their loan qualifications first: there are many choices involved in getting a loan, and choosing the right loan should not be an afterthought.

Thanks for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Most parents make home buying decision around kids:

A recent survey by Coldwell Banker Real Estate found that 79% of Millennial parents (between 18 and 34) and 70% of Gen X parents (between 35 and 49) make major purchasing decisions around

their children, stating that they are more concerned about the immediate impact of a move on the emotional well-being of their children than whether moving is a good decision.

Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Our next E-Waste & Shredding event is on:
Sat. Oct 25, 9am - 2pm (or until truck is full)
at: 161 S. San Antonio Rd
Los Altos, CA

Eye Candy.. Prime properties for sale.

This is the latest edition of our Coldwell Banker Previews International offerings. Most of the properties are pretty close to home, or even right there where we live.  Click on the cover to see the magazine.

Let me know if you have any question about one of these homes!

Francis Rolland
Previews Specialist

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Our next E-Waste & Shredding event is on:
Sat. Oct 25, 9am - 2pm (or until truck is full)
at: 161 S. San Antonio Rd
Los Altos, CA

Top 10 Cities for Projected Job Growth.

Where the jobs are...

As Realtors we know how important a role a robust job market plays in driving home sales.  So which big cities feature the strongest job markets?

Forbes magazine ranked the top big cities for projected job growth in 2014 based on several factors:
- current growth of employment rates,
- mid-term growth (the average annual rate from 2008-2013);
- long-term trends;
- and a 10-year average.

Three of the top-ranking cities are in Texas, while two are in California.

Top 10 cities:

1- San Jose-Sunnyvale-Santa Clara, California,
2- San Francisco-San Mateo-Redwood City, California,
3- Austin-Round Rock-San Marcos, Texas,
4- Raleigh-Cary, North Carolina,
5- Houston-Sugar Land-Baytown, Texas,
6- Nashville-Davidson-Murfreesboro-Franklin, Tennessee,
7- New York City, New York
8- Orlando-Kissimmee-Sanford, Florida,
9- Dallas-Plano-Irving, Texas,
10- Denver-Aurora-Broomfield, Colorado.

Thank you for reading!
Francis

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates

Our next E-Waste & Shredding event is on:
Sat. Oct 25, 9am - 2pm (or until truck is full)
at: 161 S. San Antonio Rd
Los Altos, CA

Student loans causing housing shift...

An analysis by the Federal Reserve Bank of New York found that for the first time in at least a decade, households with student-loan debt are less likely to have a mortgage than those without student-loan debt.

Additionally, a survey by the National Association of Realtors found that 49% of Americans reported that student loan debt is a "huge obstacle" to homeownership.

I had already blogged in July of last year about student loans and the general concerns this is causing for the housing market; the average pay-off time for a student loan is 21 years! 
This is also the subject of an article just published in the SJ Merc. on Sept. 23 2014, indicating: a "consultant's study says 8% fewer houses sold in the U.S." (as a result of student debt levels).
The Consultant is John burns Consulting, an Irvine-based firm that advises homebuilders. The article is from Tim Logan of the Los Angeles Times.

Thanks for reading!
Francis


Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates
Our next E-Waste & Shredding event is on:
Sat. Oct 25, from 9am to 2pm (or until truck is full)

at: 161 S. San Antonio Rd
Los Altos, CA