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Intero Insider: Seeing Signs of Recovery Yet?

By Gino Blefari | March 2nd, 2010 0 Comments

One week, it’s up. The next week? Down. No matter what the experts say, the fact remains that no one really seems to be able to put their finger on how fast or slow the recovery of the real estate market will be.

There are some who say that we haven’t seen the worst of it yet (and we sincerely hope that’s not true).

Others have a shinier view, saying that the turnaround has been made and that we’re well on the way back.

I think it’s more prudent to take things more cautiously. To brace myself for setbacks, but to take heart in the great strides the real estate industry has made in the past year. Make no mistake, however, the recovery of this sector isn’t going to be instantaneous, no matter how badly we’d like it to be. The boom market by which we were spoiled lasted the better part of a decade, and it left a great deal of wreckage in its path.

That said, last week, Standard & Poor’s released its quarterly home price numbers. And what they show is encouraging. They show that, while it’s gradual and slow, recovery is, most certainly, taking place. For the seventh consecutive month, there was an improvement in pricing. Granted, this quarter’s increase was just three tenths of a percent, but it’s an increase all the same.

Substantial gains were seen in San Francisco, which saw a five percent gain, in San Diego and Dallas, each of which showed gains of three percent, and gains that were far above average in Washington, DC, Boston and Denver. Even cities that have been hit (and hit very hard) by the sagging real estate market, such as Las Vegas and Phoenix, saw increases, and that’s not something that’s happened for them in a very long time.

Even Warren Buffet, whom we all can agree knows a thing or two about money, seems to feel that we’ll have recovered from this slump by 2011. He said recently that while prices will remain below “bubble” levels, a more normalized market will be return by sometime next year.

We are, by no means, over every hurdle. We are not sprinting toward the finish line. But we are making progress. Slow and steady, to be sure, but progress. I take heart in that. I think that a measured recovery is the key to winning the race and standing on the podium, once and for all.

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Does it Pay to Remodel?

By Russ Boyd | February 25th, 2010 0 Comments

Every year, Remodeling Magazine publishes the Remodeling Cost vs Value Report. You can now view the 2009-2010 Cost vs Value Report here:

2009 was a year of transition for the remodeling and real estate. One would have thought that the costs for remodeling projects would have fallen, but that turns out to not be the case, although the rise was smaller than in previous years. On the other side of the coin, even though costs increased slightly, the value added of the projects dropped slightly. Of courses some of the difference could be the result of consumers sticking to projects that are “back to the basics”.

According to the report, for now, it looks like “Bling is not the thing.” The four-year Cost vs. Value trend toward smaller, low-maintenance projects and an emphasis on essentials over extras will likely continue to influence homeowners remodeling plans. Exterior improvements were more common, primarily because exterior improvements contribute to the overall look and feel of a building. In other words, in a market where there are more buyers than sellers “curb appeal is king.”

For the San Francisco Bay Area, improvements that increase a home’s value above the project’s cost included, adding a bedroom in the attic, a new deck, new entry doors, kitchen and bath remodels and window replacement.

The report provides data on a national, regional and local level for easy comparisons.

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A Condo Here or a Single Family Home There?

By Dawn Thomas | February 24th, 2010 0 Comments

One of the classic trade-offs in real estate is the choice between a single family house with a longer commute versus a more centrally-located condo or townhome.   If you decide to go for the condo or townhome – here are 9 critical items to consider when considering a purchase:

  1. Homeowners Dues – are they too high?  too low?  High dues (in comparison to other similar properties in the area) could reduce your purchasing power and may indicate that the complex is playing “catch up” on deferred maintenance.  Unusually low dues may indicate that the association is under-budgeting for future maintenance and repairs – potentially resulting in a future “special” assessment.
  2. HOA Financial Analysis – how are the budget and cash reserves for the Homeowner Association (HOA)?  Are there any special assessments in the recent past or in the near future?
  3. HOA Documents – Carefully review the documents governing the Homeowners Association – including the CC&R’s  (Covenants, Conditions & Restrictions) as well as less formal documents like newsletters.  Consider hiring a real estate attorney to review these documents.  Newsletters may indicate potential issues that could become litigation or special assessments in the future.
  4. Exterior condition – do you like what the outside of the complex looks like?  If the landscaping, parking lot, or pool looks like a “fixer upper” – it may not be easy to convince your new neighbors to agree and fund the changes.
  5. Parking – how’s the parking in the complex – not only for you – but also for your guests?   If guest parking is limited to “street parking” – check out its availability at a peak “at home” times like Sunday evenings.
  6. Floor plan – does the layout of the condo work for you?  Unlike a single family home – you won’t be able to “bump out” the dining room 4 feet to make room for Grandma’s china hutch.
  7. Who are Your Neighbors? Two vital stats that may affect your ability to get financing are the percentage of owner occupants in the complex as well as the number of units in foreclosure.
  8. Size of the Complex – Is the complex too small, too big, or just right?  This is a matter of personal taste.  Very small complexes with only a few units may demand more of your time and money to manage.  Very large complexes may feel impersonal, be more complex to manage, and always seem to have several competing properties on the market (which may affect your future resale).
  9. Location, Location, Location – and finally – where is the condo or townhouse located?   Consider both the macro location – where in the Bay Area do you want to live – as well as the specific location of a given complex (commuter route, shopping nearby, schools).
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2010 Census: More than Just Counting People

By Cindy O'Leary | February 15th, 2010 0 Comments

2010 Census Details:
The objective of the 2010 Census is to count all residents living in the United States on April 1, 2010. Census forms will be mailed in March and are scheduled to arrive in mailboxes between March 15-17th. Residents are asked to answer ten questions (one of the shortest in history) and return the form by April 1, 2010. Responses to the Census questionnaire are required by law.

Besides counting all residents, the 2010 Census population totals also determine which states gain or lose representation in Congress and how more than $400 billion of federal funding is spent each year on infrastructure and services like hospitals, job training centers, schools, senior centers, public works projects, and emergency services. How California will be affected by the 2010 Census will surely be an anticipated result of this survey.

All responses are confidential, by law, and cannot be shared with any other government agency such as the FBI, the IRS, welfare and immigration.

History:
The first census was taken in 1790 to determine the number of seats for each state in the House of Representatives. This census also provided a better understanding of where people lived and helped to establish settlement patterns as the nation grew. In 1902 the Census Bureau was established. Besides gathering population data every 10 years which is constitutionally mandated, the Census Bureau administers more than 200 surveys annually including the Current Population Survey and economic censuses every five years.

For more information on the 2010 Census, log onto www.2010census.gov.

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The Party Might Just Be Ending for Low Interest Rates

By Ed Gory | February 12th, 2010 0 Comments

It’s safe to say that mortgage interest rates have been at historic lows since the summer of ’09, mostly around and sometimes even under 5%.  Currently, they’ve been floating around the 5 & 1/8% range.

Part of the reason for these low rates has been because the Fed has been on a buying binge of Mortgage Backed Securities (MBS).  The Fed has been buying $1.25 trillion in mortgage-backed securities in its effort to prop up the economy, but has said it will end those purchases March 31.

As I speak fairly regularly with seasoned, well-informed, and intelligent mortgage lenders and brokers, one thing they all seem to agree on is that the expectation is that, after March 31st,  rates will head upwards, and will likely be in the 6% range.

Still pretty low, historically – but, a significant impact to the buying power of home buyers out there.

Just think about it, if you’re looking at a loan amount of say $700,000, this means that a 1% increase in interest rate translates to paying $450 MORE per month on the same loan.  Or looked at another way, a 1% increase in rate just reduced the sale price you can afford by about $80,000.

Quoting some highlights from a recent WSJ article:

What happens when it (the Fed) stops buying hundreds of billions of dollars in financial assets?

In its monetary-policy statement, the Fed said it would “gradually slow the pace of these purchases in order to promote a smooth transition in markets.” Suddenly cutting to zero, presumably, could prove too much of a jolt.

But even a gradual pullback could have big repercussions. Zero interest rates and Fed purchases — financed by printing money — have played a massive role in reviving stocks and bonds and rekindling the economy.

Mortgage rates will likely move up, as private-market buyers will charge more than the Fed for bearing the risks of holding government-backed mortgage securities. Now, the Federal Reserve has said they would consider reopening its program to support the mortgage market if interest rates spiked or the economy showed new weakness.

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Are Greener Homes a Passing Fad or Here to Stay?

By Tadas Narauskas | February 12th, 2010 0 Comments

solar home

Whether one takes climate change seriously or not, one truth stands tall for any home buyer – energy efficiency, resource conservation and healthy indoor air is becoming a must.  But with the economy still unraveling and the cloud of uncertainty hanging over our heads, a question looms… Can green homes gain traction in our fragile housing  market?

As you may be aware, Santa Clara County real estate market has been quite unpredictable.  It went from four months of inventory into less than one month of inventory in one year and no one really knows what the future holds.  Even some of the biggest market experts have been embarrassed and increasingly keep their Nostradamus like market predictions to themselves.

At the same time, for the past few years, we may have noticed a quiet revolution taking place in our hearts.  Not only we are craving to live happier, healthier and more empowered lives, we are seeking friends and atmosphere that will support that earning.  Also, with raising energy costs and ever growing health problems, many of us are looking for answers right where we sleep – our homes.

So what has kept more people from seeking out these energy efficient and often healthier homes?  Mainly – the lack of awareness and price.  We’ve been conditioned to think that everything green and organic come with an extra big price tag, and with a good reason!  However, when it comes to homes it’s not always true.

Some new home builders who have built green home developments in San Jose claim that their homes are not more expensive than their non-green certified competition. The reason being is that builders are able to buy renewable energy systems like solar panels at bulk prices and receive incentives from PG&E and the state.  In fact, smart builders can use fewer resources to build homes and save money on materials.  This effectively helps developers pass the savings to the consumer.

Now if an older home has undergone a deep retrofit and was upgraded with energy saving systems like solar panels or solar water heater, it may indeed cost a bit more than regular homes.  One must keep in mind though that here we must look at price vs. cost of ownership analysis.  What do I mean?  Well, imagine your home had a mortgage that is $100 higher than your neighbor’s but you were saving $150 in utility bills, would that be such a terrible predicament to be in?

One may say… but wait, some folks really go all out with their upgrades and “eco-chic” elements that they will never re-coup the costs.  It’s true, but it’s also true with high end upgrades that have nothing to do with energy efficiency or sustainability.

As for the future of our real estate market and green homes, my crystal ball has nothing but beautiful images.  Why?  Because energy conserving homes not only produce less pollution but also because owning one will absolutely, most definitely make perfect financial sense.

Think about it, if you had a choice whether to buy a home that is more energy efficient, healthier for your kids, and conserves resources or a home that was built to minimum standards that had high utility bills, which would you choose?  You see, once we are increasingly presented with this choice in the future, the decision will be as easy as popping a soap bubble.

Personally, I am thrilled to see more and more people considering the impact their homes have on the environment.  In addition, something very profound is taking place during this economic turmoil – we’re shaping to be smarter consumers.  We’re growing in wisdom that we must consider the true cost of owning “stuff”.  This is why greener homes will set new standards of quality and resource management in the very near future.

More on Green Homes:  http://SanJoseGreenHome.com

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Redwood City’s Edgewood Park to Open Up a New Ed Center

By Ed Gory | February 11th, 2010 0 Comments

Nestled in the Emerald Hills neighborhood, one of the gems of Redwood City is its county park, the 467-acre Edgewood Park (on Edgewood Rd & Crestview).  A beautiful place to hike, run, picnic, and get jaw-dropping vistas of the mountains and the SF Bay.

After a long-time coming, a new educational center is set to open up in the fall. More info via this article in the Merc, but here’s the highlights:

After more than a decade’s worth of fundraising and countless volunteer hours spent on planning and design, the county will break ground today on the 1,200-square-foot Bill and Jean Lane Education Center, which should be completed by next fall.

The $2.3 million center will give 100,000 annual visitors to Edgewood new insight into the park. Though it only stretches 1 square mile, tucked into a pocket of forest and grassland on the fringes of an urban area, the park boasts more than 500 different plant species and 70 resident and migratory bird species.

A hike along one of Edgewood’s many trails uncovers many different ecosystems, from oak and redwood trees to rivers and serpentine grasslands, each with its own flora and fauna.

The executive director of the San Mateo County Parks Foundation said the educational center will include interactive displays, games and even computers to give people a new perspective on everything they see.

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Hollister Housing Expo Expects a Crowd

By Kristen Para | February 8th, 2010 0 Comments

Tax returns, pay stubs, bank statements, social security, DNA, hair sample, finger prints, spit swab seems to be only a few things a lender is requiring to resolve a mortgage problem these days, but help is on the way!  The City of Hollister Redevelopment Agency is putting on the two day 2010 City/County Housing Expo at the Veterans Memorial Hall at 649 San Benito Street, Hollister to help struggling homeowners figure out if they qualify for a loan modification or the results of a Notice of Default.

The free bilingual (English and Spanish) public event held on Thursday, February 25 from 9:00 am – 5:00 pm will have a presentation from Legal Aid (Real Estate Attorneys) and Certified Public Accountants (C.P.A.’s) on the Foreclosure Process, Renter’s Rights, Loan Modification, Short Sales, and Tax Consequences.  On Friday from 3:00-7:00 pm different organizations will discuss the home buying assistant programs and incentives through California Housing Finance Agency, Chase, Bank of America, and many more.  The more prepared homeowners are with questions and paperwork, the more likely they will get real results with a real person in few minutes time.

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Green Homes are the Future that’s Already Here – Are You In It?

By Tadas Narauskas | February 2nd, 2010 0 Comments

You’ve heard the term “Green Home” by now; perhaps a multitude of times if you have browsed environmental webgreen home wood sites or magazines.  Have you ever wondered what that really means?  Are green home builders simply trying to ride the latest eco-fad or is there really some substance to the word “green” when it comes to homes?  Why should we care anyways?

Essentially, living green implies being aware of the environment around us.  We do our best to consider results of our actions when it comes to our bodies, health and nature around us.  Green homes are no different and there’s truly much more to these homes than the philosophy behind it.

An eco-friendly home is a home that—compared with a standard home—uses less energy, water, and natural resources; creates less waste; and is healthier for its inhabitants.  These homes can either be built green from the start, or they can undergo some alterations or remodels later down the road.

5 KEY COMPONENTS

Truly green homes will take into account the following key principals essential to green building and remodeling:

1.   Design and size: Good site design and just large enough, as opposed to larger is better.  The reality is that a 4,000 square feet home will require more heating, air conditioning and lighting than a 2,000 square feet home. If you really want a sustainable home, choose a smaller size.  A green home will also consider orientation on its site to bring abundant natural daylight and to take advantage of any prevailing breezes.  This obviously works best if you are a building a new home but you can also keep this in mind when shopping for a re-sale or considering improvements on an existing one.

2.   Community connectivity: Located close to work, school, recreation and other basics.  The idea is to consider the “walkability” of the neighborhood and whether you will be able to ride a bike to your best friend’s house.  Less time in the car – less pollution.  More time on the bike or feet – better health.  I’m sure you’ll agree – both of the two will reduce your carbon footprint and increase your overall enjoyment of life.  You can check your neighborhood’s “walkability” score at www.walkscore.com.

3. Energy and water efficiency: This incorporates things like natural day lighting through the use of skylights or daylight tubes, Energy Star appliances, better home insulation, low E rating windows, dual flush toilets, low flow sinks and shower heads.  Increasingly, you will see the use of solar energy to produce hot water with solar hot water heaters and electricity provided by solar panels.  In general, people who live in green homes save money by consuming less energy and less water than standard homes. Over the years, that also adds up to big savings.

4. Material selections: Use of sustainable and renewable materials, where possible recycled and/or reclaimed products. Wood-based features should come from rapidly renewable sources like bamboo, but if tropical hardwoods are used, they must be certified by the Forest Stewardship Council. A green home uses salvaged materials like kitchen tiles and materials with significant recycled content.  Some of the most popular updates to do these days are to use recycled glass countertops for your kitchen and install cork flooring.  Both look and feel amazing.

5. Indoor air quality: This one is obvious – avoiding the use of toxic materials at all costs.  Use only low or no Volatile Organic Compound (VOC) paints.  Keep in mind that materials and even furniture can off gas and slowly intoxicate the inhabitants of a home.  One of the most important things is well thought out ventilation to bring fresh air from outside.  Remember one general rule here: that new house smell is actually not good for you.

As you see, green homes are not some fancy labeled and awkward dome shaped structures that are reserved only to the taste of the hippies from the 60s.   In fact, from outside they may look like any other home but they provide its dwellers substantial benefits like better air, lower bills and a feeling of doing the right thing for the environment.

It’s hard not to be excited about the future of environmentally friendly homes. We are truly at the forefront of green innovation and use of sustainable materials here in California.

Many people run out and protest in front of Congress demanding change but it is our homes that must be at the forefront of our efforts to stem the climate change problem. Our path towards sustainability and a brighter future can truly start at home.

More on Green Homes:  http://SanJoseGreenHome.com

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From Cars to Baseballs: A ‘Home Run’ for Fremont?

By Cindy O'Leary | January 29th, 2010 1 Comment

The Situation:

  • NUMMI auto manufacturing plant: The imminent closing of the New United Motors Manufacturing plant (NUMMI) is fast approaching the March 2010 shut down date. This successful joint venture with Toyota and General Motors, a mainstay of manufacturing in Fremont for nearly 25 years, is coming to an end with the dissolution of the partnership because of GM’s bankruptcy issues. Since the prospect of other car manufacturers using the plant have failed, alternative uses have been explored by the City of Fremont and others. To date, no viable plans have solidified.
  • Oakland Athletics: In 2008, Fremont was also in the news as a contender for a new baseball stadium for the Athletics, currently in Oakland. The site originally proposed at the south end of the Pacific Commons shopping center at Highway 880 and Auto Mall Parkway was defeated by strong opposition from retailers in the center. Additional sites were also defeated by residents on the east side of Highway 880.

Turn of Events:

  • There is now a revived interest in reconsidering Fremont for a new, 36,000-seat stadium at the soon to be vacated NUMMI plant location. The proposed stadium complex would be within walking distance of the new BART stop which will be completed in 2014.

A major sports arena has a big impact on any community, both positive and negative. Here are some thoughts in both directions.

Pros:

  • Boosts local economy by providing hundreds of new job opportunities during construction and beyond.
  • Brings in needed revenue to Fremont city coffers
  • Stimulates businesses around new facility
  • Spawns new business and employment as a result of the new baseball stadium
  • Is a ‘feather in the cap’ for any city to have a major league sports stadium

Cons:

  • Traffic will increase on game days
  • Crime may increase
  • Additional costs to city for clean up, security and police
  • Funding of stadium still not resolved: private vs. public funding
  • If the stadium is not successful in increasing attendance for the Athletics, what will happen to the facility?

What is your ‘take ‘on a major sports arena in Fremont?

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