Archive for January, 2012

The Luxury Insider: The future of the luxury market

By Alain Pinel | January 25th, 2012 0 Comments

Dear readers –

As you may have heard, recently industry icon and good friend Alain Pinel joined our Intero family. To further share with our readers his tremendous knowledge on luxury real estate, you will receive a Luxury Insider – A weekly glimpse of the high-end real estate market blog written by Alain. Hope you enjoy this valuable information. And thank you Alain for your insight on the luxury market.

- Gino Blefari

2011 is gone. Thank you. Don’t know too many home sellers and home buyers who will remember it fondly. I will venture to say that most Realtors share that sentiment. Actually, the best thing that can be said about last year in the real estate business is that… It did not get worse. We’ll take it. After some four years of nasty economic news and agonizing uncertainty, a flat year is a welcome transition. Real estate values have stabilized in the Silicon Valley. The ground is firmer. We now have a more stable foundation to build on. The business climate also is changing: the many “For Lease” signs that we used to see in the hi tech districts have disappeared from the curbs and the job situation has improved considerably. We still have to jump a few hurdles such as a tight credit but, together with low mortgage rates, a decent inventory of homes, attractive prices and a growing pent up demand, today’s picture calls for optimism.

The segment of the market most likely to benefit from the above is the luxury market, the “high end of the high end.” In a way, it was to be expected since it is the segment of the market that suffered the most over the last 12 years or so. Since the dotcom hay-days of 1999 and 2000, prices and number of sales have been cut significantly.

Case in point, let’s take a look at Atherton, the perfect “high end market,” during that stretch of time.

In 2000, 28 sales over $5,000,000 were posted on the MLS for an overall market average price of $3.8M. From that point on, the number of transactions shrunk and ended up at 10 last year, roughly a third of the 2000 high mark. The stats for 2004 came close (21 sales), but no cigar.  In terms of price, the overall Atherton market average last year was $3.4M, still 10% below the price achieved in 2000.

At a time when cash is coming back to the valley, fed by new IPO’s, a new wave of  buyers in the $ million range anxious to move their equity to higher grounds and foreign investors looking for a safer refuge for their money, things are looking up in the luxury market. I bet the high end is going to be again the market locomotive it used to be. Happy New Year!

  • Get new posts via email
  • Subscribe

Intero Insider: Need Directions? Ask a Realtor

By Gino Blefari | January 24th, 2012 1 Comment

I’m always amazed at the amount of local community knowledge a typical Realtor has. If you need to know about the local preschool situation, where to get the best cup of coffee within earshot of a specific address, where to get free Internet while you enjoy a hot beverage or quick lunch, and where the best morning bun in town is served, ask a Realtor. Seriously.

But many times you wouldn’t know this as a home buyer or seller while out shopping for a Realtor. It seems that many agents’ marketing materials don’t seem to get this point across – that not only is this agent a master at closing sales in a particular neighborhood or area, he’s also an expert at all things local. He knows the right plumbers, contractors, inspectors, landscapers, cleaning services, florists, and interior decorators. You name it.

I think it’s time agents get the recognition they deserve as neighborhood connoisseurs, specialists, experts. Sure, you want an agent with an impeccable track record of selling houses in your area or area of interest. You want a master negotiator, a well respected and well connected professional. But you also want someone who’s going to be able to either tell you exactly what it’s like to live somewhere, how close life’s essentials are, and so forth or connect you directly with the people who can answer those questions.

One of my hopes for 2012 is that our agents realize their local expertise as the true asset that it is, and that they can convey its value to consumers before meeting face to face.

I cringed a little upon reading a recent news item about a new app that plugs into your Facebook account and segments your Facebook friends based on a location you type in. For instance, if you’re interested in moving to Palo Alto, this app could pull info for you on people who have either indicated that they live there or tend to check in there a lot on Facebook (indicating that they spend a lot of time there).

It’s a good idea: being able to pinpoint whom to ask local questions. And friend and family input is meaningful to people. But my gut reaction was that our Realtors are already really good at providing this information. Maybe it’s just time we put more emphasis on this knowledge asset.

Buying or selling a home is still one of the largest transactions a person will take part in in their lifetime. Where you live is an essential part of your being – and can have serious consequences on your family’s future. Let’s not lose sight of this high-touch aspect to being an agent – that sometimes through all the complications of a jargon-filled transaction, what a consumer really needs is for someone to understand their more intangible needs that help them realize whether or not they can actually live in a particular home or neighborhood. This is one of our greatest strengths as real estate professionals.

  • Get new posts via email
  • Subscribe

Dale Cogan and Bob Bronswick join Intero El Dorado Hills

By Teressa Francis | January 20th, 2012 0 Comments

Dynamic duo partners with Intero Real Estate to support Intero into explosive growth in the Sacramento region

Cupertino, California – (January 20, 2012) – Intero El Dorado Hills has announced it will operate under the new leadership of Dale Cogan, Office Manager, and Bob Bronswick, Chief Operating Officer. Together Dale and Bob will expand the Intero brand in the greater Sacramento region.

Over the course of a 27-year career involving real estate, Bob Bronswick, former President and COO of Coldwell Banker Residential Brokerage/NRT, LLC. for the Sacramento region, has earned a reputation as a dynamic, results-oriented senior management-level executive with a proven track record of providing vision and leadership through highly volatile market conditions. He has utilized the proactive approach to enhance operational effectiveness and visibility for market penetration and sales; recruiting, training, and managing professional and support staff to form motivated, top-producing teams.

Prior to being named President and COO of Coldwell Banker, Bob was Director of Sales for Realty Plus Online in Sacramento; Sales Manager/Broker for Prudential Burnet Realty in Arlington Heights, Illinois; and General Sales Manager for Lebovic Realty Group in Lincolnwood, Illinois.

Bronswick explains, “Dale and I are thrilled to become part of the Intero® family, and feel good knowing that we’ll have the strong operational, fiscal and management skills needed to win in today’s market.”

Dale Cogan spent the previous 5 years as a Manager for C21 Select Real Estate Group. At one point he was the Team Leader of four Century 21 Select offices, overseeing 200 agents. His primary responsibility was Team Leader for the El Dorado Hills and Cameron Park Century 21 Select offices.

Previous to serving as Manager of C21 Select Real Estate Group, Dale was with Lyon RE and has been in real estate a total of 12 years.

Dale adds, “I am honored to be joining the Intero brand, a truly innovative organization that is growing while others are shrinking. I am excited for the opportunity and all that we can achieve together.”

“We are excited to align with Dale Cogan and Bob Bronswick and leverage Intero’s bay area presence,” said Jason Stephens, owner and CEO of Intero El Dorado Hills. “Their progressive business philosophy coupled with their real estate expertise will revolutionize the way real estate is done in Sacramento.”

  • Get new posts via email
  • Subscribe

Intero Insider: Why Low Interest Rates Are Still Vital to the Housing Economy

By Gino Blefari | January 17th, 2012 0 Comments

Interest rates. It’s a constant topic of conversation in real estate, and this year so far is no different than the last few: We’re kicking it off with some of the lowest interest rates on long-term mortgages that the market has ever seen. The average rate on a 30-year fixed-rate mortgage reached an all-time low of 3.89% this month, according to a survey tracked by Freddie Mac.

Two messages are important in this news for home buyers and sellers. They are:

1. Low interest rates are significant for home buyers, equating to big savings when locked in at the right time. This is a point that can actually motivate a lot of buyers to get off the fence.

For instance, let’s look at a .5% increase in a mortgage rate on a 30-year mortgage for $425,000. Say our buyers could get a 4.75% interest rate when they first start their real estate search. If they indeed buy a home and lock in a mortgage at this rate, they’ll end up paying $373,120.42 in total interest over the life of the loan.

But say these buyers get lost in their decision-making process and end up taking eight months to make a decision on a home. By the time they lock in their rate, they end up with a 5.25% interest rate on a 30-year mortgage for the same $425,000 loan. Now, they’ll end up paying $419,871.66 in interest over the life of the loan. That’s a $46,751.24 increase in the final interest bill – substantial to the average family buying a home.

Taking advantage of the lowest rates possible is a key message that will help to motivate a lot of buyers in 2012.

2. While no one can predict when interest rates will increase or by how much, we know they inevitably will increase, but can also feel comfortable that they’re not going to jump suddenly. Most analysts and industry observers expect rates to remain low as long as the economy is still in a slow recovery. That’s good news for buyers and sellers alike (more affordable borrowing means more buyers in the market, in most cases).

Low interest rates alone cannot save a housing slump, or single-handedly create a boom (remember that our last boom was also fueled by very loose loan underwriting standards that created a lot demand from market segments that would not be eligible for loans under today’s standards). But they’re still extremely important to the recovery story. They still have a vital role. Let’s not undermine that, or let that point get lost in the shuffle.

  • Get new posts via email
  • Subscribe

Intero Franchise Services, Inc. further expands presence internationally

By Teressa Francis | January 16th, 2012 0 Comments

Announcing Intero Los Cabos

Cupertino, California – (January 16, 2012) – Intero Franchise Services, Inc. announced its continued expansion with the opening of a new international location in San Jose del Cabo within the municipality of Los Cabos, Mexico. This office will be in the center of town, located next door to the local Starbucks, at Local 7 in the plaza mega commercial.

Franchise owners and partners, Steve Boyle and Richard Rand are converting their existing brokerage to Intero Los Cabos. The renovation is scheduled to be completed very soon and they are looking forward to their grand opening celebration Thursday, February 2, 2012 between 5pm – 9pm.

With all existing agents on board, Steve and Richard anticipate to grow their office to become the premier real estate company in Los Cabos. They plan to create an office that is focused on selling the lifestyle dream. Being a multifaceted residential brokerage, they want to also entice developers to the vacation properties available in Mexico.

“We are excited to extend the Intero brand into the Mexico market,” said Steve Boyle, acting broker of Intero Los Cabos. “There is a lifestyle opportunity that exists in San Jose del Cabo. The Intero brand’s strength in the U.S. and internationally make it the ideal partner to provide quality real estate investment opportunities to our client base. The Intero system therefore will revolutionize the way real estate is done here.”

“We are pleased to have Intero Los Cabos become part of the Intero® family,” said Intero Real Estate Services President and CEO Gino Blefari. “We’ve always thought about expansion in terms of the individuals involved. We go where we find people who are the right fit for the Intero brand because they have the same values and believe in the culture we’ve created. Steve Boyle and Richard Rand are those people. With them on board, we simply couldn’t pass on the opportunity to expand into Mexico.”

Intero Los Cabos:
Los Cabos S. de R.L. de C.V.
Local 7 de la Unidad Comercial ubicada en Boulevard Mauricio Castro no. 4650,
Col. Zona Hotelera,
San José del Cabo, Baja California Sur, C.P. 23400

  • Get new posts via email
  • Subscribe

Fed Opens the Year with a Plea for Housing

By Gino Blefari | January 11th, 2012 0 Comments

2012 is going to be a big political year for housing – and not just due to the presidential elections. The Federal Reserve has already kicked off the year by stepping into delicate political territory with its letter and white paper outlining U.S. housing problems to the congressional committees in charge of banking and financial services.

The move was quite surprising, given that the Fed was not given a formal request. The actual letter begins with: “Restoring the health of the housing market is a necessary part of a broader strategy for economic recovery.” The Fed’s opening argument is that the ongoing problems in the U.S. housing market continue to impede the nation’s economic recovery.

It’s clear the Fed wants to make housing the centerpiece of the national economic debate in 2012.

The white paper then goes on to outline a framework for possible policy changes that could help boost the housing economy and help struggling homeowners. Four of the possibilities outlined are:

Help more underwater homeowners refinance at lower rates. This policy is an old idea that was already poorly implemented under HARP in 2009. It was meant to help holders of the 8 million mortgages owned by Fannie Mae and Freddie Mac that carry an interest rate above 6%. It hopes to extend refinance possibilities to those who’ve not been able to take advantage due to inadequate or no equity, spotty credit or tightened lending rules.

New rules for HARP, however, could open it up to millions more households in need.

Large-scale principal reduction initiative. Lowering the amount of money that mortgage holders owe on their loan principal would drastically change the financial landscape for millions of families. The Fed notes in its paper that 12 million mortgages are underwater now, adding to about $700 billion in negative home equity.

Tackling this deficit would put many homeowners back in an ownership situation that makes financial sense given the current market condition and economy.

Convert vacant government-owned foreclosed homes into affordable rentals. This makes a ton of sense. The two housing finance agencies Fannie and Freddie own more than 230,000 foreclosed homes. Why not set up government programs that turn this unsold inventory into much-needed rental housing (a market that’s seen a rise in demand in the wake of the housing slowdown)?

Establish fair consumer protections for mortgage servicing. The Fed and others want to add a layer of consumer protection into the mortgage servicing market that previously was not there. Mortgage services currently have no fiduciary duty to protect consumers from errors and omissions in the servicing process. This initiative would add protections and potentially even change the compensation model to better protect consumers.

There’s a lot more detail in the Fed’s letter and white paper, which is available online. I suspect this is the first of many politically charged moves we’ll see this year. I just hope that some of these policies get it right and pull more families up from the depths of the housing collapse, helping to push economic recovery a bit harder and faster.

  • Get new posts via email
  • Subscribe

A look into the luxury real estate market, Featuring Alain Pinel

By Teressa Francis | January 10th, 2012 0 Comments

In this Intero Insider, renowned real estate entrepreneur, Alain Pinel, discusses current and past trends of the luxury real estate market.

Alain recently joined the Intero Team. As a Senior Vice President and Managing Officer, he will facilitate Intero’s Estate and Luxury markets, both nationally and internationally.

  • Get new posts via email
  • Subscribe

Alain Pinel Is Back In Town…

By Teressa Francis | January 3rd, 2012 0 Comments

Intero Real Estate Services, Inc. the obvious choice for industry icon

(Cupertino, CA January 3, 2012) – Alain Pinel, the renowned real estate entrepreneur whose name is on the façade of a leading national real estate company, has returned to Northern California and will serve as Senior Vice President and Managing Officer of Intero Real Estate Services, a premier real estate brokerage company headquartered in the Silicon Valley.

In his new role, Pinel will use his experience and past success in facilitating Intero’s Estate and Luxury markets, nationally and internationally.

“I have a passion for this business”, said Pinel, “I am excited to begin a new project with an outstanding brokerage and a progressive leadership team. I look forward to joining forces with Intero and working with their Luxury Brand.”

Pinel’s 30 years in the real estate business have made him a leader with a solid track record for success:

  • In the ’80s, while EVP and General Manager of Fox & Carskadon, then the largest residential real estate firm in the area, the firm tripled its volume of sales (over $3B) and emerged as one of the top companies in the country as well as a regional high-end real estate leader.
  • In 1990, as founder, chairman and CEO of Alain Pinel Realtors, he reinvented the marketing of high-end properties around international advertising and state-of-the-art technology, before selling the firm to his two partners to spend a few years in Europe.
  • Through the end of 1994, Alain Pinel was in Paris, in charge of the commercial activities of Sefimeg, the largest real estate entity listed on the French stock exchange with a portfolio of over 9,000 apartments and 3 million square feet of leased commercial space.
  • In 1995, Coldwell Banker brought him back to California. As SVP for the San Francisco, Peninsula & Silicon Valley region until 2002, Pinel put incredible new records on the books for the company with a sales volume of $13 billion in 2000 and 14,000 closed residential sales.
  • In 2002, together with three partners, he founded Imminence, a start-up that changed the way real estate is done in France and neighboring countries.  With a core business built around the MLS system, he provided a menu of marketing, financial and productivity tools to the industry.
  • From 2008 to the Fall of 2011, while SVP & General Manager in Massachusetts for William Raveis, the 10th largest real estate firm in the U.S., the company saw its market share jump 50%. It was voted “Best real estate company in Massachusetts” four years in a row.

Mr. Pinel is also a former VP of FIABCI, the International Real Estate Federation in Northern California, and former VP of the French-American Chamber of Commerce.

“We are thrilled to have Alain Pinel as part of the Intero team”, said Intero Real Estate Services Founder, President & CEO Gino Blefari. “Alain is a seasoned real estate veteran with tremendous knowledge and experience in the industry and we look forward to having his expertise added to our Estate and Luxury market strategy.  His extraordinary level of professionalism will continue to lead and expand the Intero brand as a household name locally and abroad.”

  • Get new posts via email
  • Subscribe

Intero Insider: Why a ‘$700 Billion Loss in Home Value’ Shouldn’t Alarm Us

By Gino Blefari | January 3rd, 2012 0 Comments

It’s the first week of a new year, a time to think about what’s in store, what will improve and what may decline in the housing economy. One figure we’ve seen gain a lot of attention over the last few years is a quantified total home value loss in the U.S. It occurred to me that this figure is actually pretty dangerous.

Just before the holidays, Zillow released a report estimating that U.S. homes were set to lose nearly $700 billion in value in 2011. That’s a mighty scary number when screaming at you in a headline. But the truth is that it’s hypothetical.

What does a $700 billion loss in home values really mean? Well, nothing to the average homeowner who’s not looking to sell. And to those who are looking to sell in 2012? It’s not great news, but it does deserve some context before we all freak out.

The positive spin in the Zillow report was that the total anticipated loss in home value in 2011 is actually 35% less than the $1.1 trillion Zillow found lost in 2010. And the total loss in value figure has shrunk each year over the last four years. So the rate of home value loss is slowing – a great sign.

The reality, though – and why I assert that this is a number that shouldn’t scare us – is that home values are much different than home sale prices. A home sale price, as reported regularly by the National Association of Realtors, reflects the value a buyer paid for a home that recently sold. But the home value loss reported by Zillow comes from some fancy math that averages the value lost in total on all U.S. homes if they were sold in current market conditions.

If you’re not looking to sell or refinance, then you don’t really need to fret much about the loss of your home’s value. Markets change over time and my advice to those owners who may be getting stomach ulcers thinking about the loss in value in their area over the last few years is to not worry about it right now. If you don’t have to sell, then don’t sell. By the time you do need to sell, you’re likely facing an entirely different market out there.

Buying conditions will continue to be good for many buyers in 2012: the amazingly low cost of borrowing, relatively large selection of inventory in many markets, and slowly improving U.S. economy will keep a stream of buyers interested.

I don’t expect a miraculous recovery in real estate on a national level this year, but I do think that a gloomy number like a $700 billion loss in total home value does a great disservice to describe what is really happening in the markets we serve. Things have improved in 2011, which is what we all expected. We’re not in a boom by any means and no one’s saying that. But we’re not coming off the worst year by far. Improvement is the name of the game. It is getting better, folks!

  • Get new posts via email
  • Subscribe