Entry-level housing affordability increases this quarter

The percentage of households that could afford to buy an entry-level home in California stood at 44% in the first quarter of 2008, compared with 26% at the same time a year ago, according to a report released by the California Association of Realtors® (C.A.R).

C.A.R.’s First-time Buyer Housing Affordability Index (FTB-HAI) measures the
percentage of households that can afford to purchase an entry-level home in
California. C.A.R. also reports first-time buyer indexes for regions and counties within the state. The Index is the most fundamental measure of housing well-being for first-time buyers in the state.

Of course San Mateo County remains more prohibitive. The minimum household income needed to purchase an entry-level home at $765,000 in San Mateo County in the first quarter of 2008 was $145,620 based on an adjustable interest rate of 5.65 percent and assuming a 10 percent down payment.First-time buyers typically purchase a home equal to 85 percent of the prevailing median price.

 

 

At 64% Sacramento County and the High Desert region were the most affordable areas in the state.
San Mateo County is up from 19% in Q1 2007 to 22% Q1 of 2008.

C.A.R. FIRST-TIME BUYER HOUSING AFFORDABILITY INDEX *

C.A.R. Region	Q1 2008	Q4 2007		Q1 2007
California	44	33		26	r
California – Condos	50	42		37	r
United States	69	65		63
COUNTY
Alameda	34	27		25
Contra Costa	31	22		19
Fresno	56	47		44
Marin	24	22		21
Merced	61	51		46
Riverside	55	42		35
San Bernardino	59	46		41	r
San Francisco	23	20		18
San Joaquin	NA	NA		38
San Mateo	22	19		19
Santa Cruz	28	22		20
Sonoma	41	36		26
Stanislaus	NA	NA		40

* — percentage of California households that can afford to purchase a median-priced home
r – revised
Source:  CALIFORNIA ASSOCIATION OF REALTORS®

 

 

Top 5 Real Estate Buys Week of May 26,2008

Happy Memorial Day. I hope you’ve enjoyed a day off and joined me in taking a moment to appreciate the men & women that have served our country. I hope those now serving abroad  will come home soon. 

There are some great real estate buys in San Mateo County right now. Each week, I’ll  feature 5 that I think buyers should consider. They will not always be right for everyone, and I will try to cover several price-points and property types.  I will base my criteria on neighborhood comps & historical value trends, the neighborhood’s long-term investment potential, and the home’s long-term investment potential. Now more than ever, I encourage buyers to see beyond the obvious. Remember that neighborhood trends are changing, and “deals” are relative. The best “deals” are homes that need some improvement.  If you want a home that’s fully remodeled, you will pay top dollar! Remember, you can contact me if you want more info or need an agent. It’s what I do…

1) 304 Elm Street, San Carlos. This home is not much to look at from the outside. But don’t let that deter you. It’s a 4/2 (over 1500 sq feet ), and a large 7800 square foot lot with expansion potential. Originalowners, never been on the market i 59 years. San Carlos has been steadily appreciating over the years (yes, even this year). The schools and  the remodeling craze are the primary sources of this momentum. A home of this size, with this kind of potential,at this price ($849,000), is an opportunity you don’t want to ignore. Listed by  Anthony Peterson, Prudential.

2) 2205 Pullman Ave. Belmont. Here’s another one that needs a little exterior pizzaz, but it’s a good one. Located just off Ralston Avenue, but set back a bit, this home has remodeled baths and kitchen, beautiful floors and a wonderful large lot with old oaks. Interior square footage is 1361 (2 bed/2 bath), and the lot is over 10,000 square feet. Belmont Schools are all good and Carlmont High is the best (evenif I am biased toward my alma mater…). LIsted at $899,000 by Anette Schendel at Peninsula Homes Realty.

3) 2460 Park Road Redwood City (Emerald Hills). This is a bank-owned property which is pretty unusual in this neighborhood. The home is new, 2050 square feet, 3 bedrooms, 2.5 baths.  A bit modern, lot is only 5500 sqare feet, but it’s a nice home and this is a hugely popular area that everyone seems to want to move into. It’s priced well for this area at $1,059,900. However, it’s been on the market for almost 4 months and banks don’t want to keep these properties on their books. So, it may be an opportunity to make an offer below an already pretty low list price. Countrywide will require you to be pre-approved with them, as they are the sellers. LIsted by Armina Kalafian of Coldwell Banker.

4) 45 Maple Way, San Carlos. This home is in tip-top condition, owned by the same couple for over 30 years. a 3/2, 1250 square feet. Lot is 5,000 and it’s in a lovely San Carlos neighborhood west of the Alameda de las Pulgas. Needs a little kitchen & bath update. Unfortunatley, the house was listed too high, so it has been sitting. A smart buyer would write an offer and get a great deal. This is a wonderful home. Listed by Justine Ford, Re/Max Today.

5) 123 A Street, Redwood City. This is a bank owned property listed at $519,900 and that price is almost $200,000 under market value. This neighborhood should never be overlooked, particularly by investors or first time buyers. It’s a family oriented neighborhood and has been for generations. Great lot at 5000 sq feet, and 940 sq feet of living space. A 2 bedroom, 1 bath. Listed by Mike Ames at Cashin Company.

Please…please use a professional Mortgage Broker

  As a real estate professional, it’s disheartening to see home owners (many of them new), in peril because they are in loans that they cannot afford. In our local market, this is less about declining home prices than it is about consumers being approved for loans that just didn’t fit their needs and their incomes. The blame has been passed but the bottom line is this: WORK WITH A PROFESSIONAL MORTGAGE BROKER. I mean, look at what’s been happening:

 Consumers using the internet to select loan products; lured in by teaser rates and “no points”. Just dumb. This is high finance, people. Use a professional mortgage broker that is interested in your long term financial well being and can advise you on what you are buying.  Why sacrifice your future to save a couple bucks on a loan product. A good mortgage broker can find a loan product that will BENEFIT you, not get you in trouble down the line.

Blame the mortgage industry itself? eh…  Sure, they were lending without much scrutiny. But the demand was high for homes…and consumers drove this frenzy, whether or not buyers could really afford what they were buying.  Supply & demand. If the consumer is  not willing to sit down & plan with a professional prior to signing on to a loan…well, buyer beware. 

Please, know what you can afford, and when. If you need referrals to professionals, get them. A good Realtor will have several that are trustworthy and skilled. Do your homework, ask questions, and use the internet for less important purchases.

 

Top 5 Real Estate Buys Week of May 19,2008

 Been on vacation so I’m a day late in posting this week’s top 5. Sorry ’bout that! Here you go…

There are some great real estate buys in San Mateo County right now. Each week, I’ll  feature 5 that I think buyers should consider. They will not always be right for everyone, and I will try to cover several price-points and property types.  I will base my criteria on neighborhood comps & historical value trends, the neighborhood’s long-term investment potential, and the home’s long-term investment potential. Now more than ever, I encourage buyers to see beyond the obvious. Remember that neighborhood trends are changing, and “deals” are relative. The best “deals” are homes that need some improvement.  If you want a home that’s fully remodeled, you will pay top dollar! Remember, you can contact me if you want more info or need an agent. It’s what I do…

1) 159 Ruby Avenue, San Carlos. Listed at $885,000 by Justine Ford at RE/MAX Today. This is a 3 bedroom 1 bath home in the White Oaks neighborhood of San Carlos, perhaps the city’s most popular neighborhood. It’s priced very well ; under $900k for a home in this shape in this neighborhood is a good buy. Great hardwood floors, a spacious   (1250 sq feet) and a 4,400 sq foot backyard that boosts a spa. Yes, the lot is a bit small but that’s pretty standard in this neighborhood.

2) 2028 Lyon Avenue, Belmont. This is a short sale and it’s  tough to find  something this affordable in this neighborhood. $699,000. A 2/1 with updated kitchen & bath.  It’s 904 sq. feet (feels bigger) and the lot’s 4,000. Small, yes, but this is a perfect starter home. Resale and comps in this neighborhood are great. Listed by Haifa Khoury & Ruba Kaileh at RE/MAX today.

3) 1504 Forge Road, San Mateo. This is a 4/2 Eichler-style home up in the highlands. Beautiful neighborhood with the best schools in San Mateo. At $998,000, this 1670 sq. foot home with updates and a mostly level lot (over 9,000 sq feet..huge), is a great buy.

4) 16 Anita Road, Burlingame. This is a classic 1930’s bungalow; the type of architecture that makes Burlingame so popular. Sure, it’s a bit small, but it has lots of upgrades and to get in to Burlingame at this price? Great opportunity. Do some more upgrades and you’re the owner of a property that will comp at well over $1 million. This neighborhood consistes mostly of newly remodeled homes. It’s  one of the last areas of opportunity in pricey Burlingame. 2 bedrooms, 1 bath (typical of a bungalow), 1170 square feet with a lot at 5700 (not bad)! Listed very competitively at $848,000 by  Michael Reid at Carlmont Associates.

5) 3863 Alameda de las Pulgas, Menlo Park. This is a fixer but it’s a great opportunity. West Menlo Park, one of the most sought-after school districts in San Mateo County. $799,500 is a price that will allow you to remodel and realize fantastic investment potential. It’s a 3 bedroom 1 bath, currently rented. 1250 square feet, lot is a little over 5,000. Listed by Suzanne Scott at Cashin Company.

Top 5 Real Estate Buys Week of May 12, 2008

 

There are some great real estate buys in San Mateo County right now. Each week, I’ll  feature 5 that I think buyers should consider. They will not always be right for everyone, and I will try to cover several price-points and property types.  I will base my criteria on neighborhood comps & historical value trends, the neighborhood’s long-term investment potential, and the home’s long-term investment potential. Now more than ever, I encourage buyers to see beyond the obvious. Remember that neighborhood trends are changing, and “deals” are relative. The best “deals” are homes that need some improvement.  If you want a home that’s fully remodeled, you will pay top dollar! Remember, you can contact me if you want more info or need an agent. It’s what I do…

1) 2736 Monserat, Belmont. Listed by Michael Ames at Cashin Company. Listed at $701,910! This is a rare bank owned property in Belmont. It’s pretty much move-in  ready and needs upgrades that are almost all cosmetic. 1190 sq feet and a private, wooded 5,000 square foot lot with a nice private front yard. The bank just dropped the price by $78,000.  Homes in this area and the Belmont Schools are excellent. This is a no-brainer.

2) 1616 Notre Dame Avenue, Belmont. Listed by Laura Bertolacci at RE/MAX Today. Listed at $889,500. Finally, a home that is priced to sell.  It’s a huge 1710 sq foot rancher on a flat 9,000 square foot lot. Great hills neighborhood above the Notre Dame campus. Bathrooms have been remodeled, roof is only 10 years old and the inspections are good for a house this age. The sellers even put in new kitchen appliances  so buyers can move in and update to their taste. The first open house was Sunday 5/11 and at least 80 parties came through! This one will move fast.

3) 45 Maple Way, San Carlos. Listed by Justine Ford at RE/MAX Today. Listed at 929,000. This is a great classic rancher in desrirable San Carlos. It hneeds an update, but all work needed is cosmentic and who wouldn’t want to have some fun creating a new kitchen? Move-in ready and priced well for San Carlos. Sellers are motivated and a buyer could likely get it for less than current asking. 1250 sq feet, 3 bedroom 2 baths. Clean inspections, needs only a quick tenting which is typical of a 1950’s Bay Area home. 5,000 square foot lot.

4) 123 A Street. Listed by Michael Ames of Cashin Company. Listed at  $559,900. This is cute fixer in the Lenolt tract of Redwood City. This neighborhood has been a favorite of first time homebuyers since World War II and now is no exception. It’s a 2/1 and it’s a small 940 square feet but the lot is great and this location is great for those interested in owning a rental unit. Rentals are popular here, and if you’ve seen current rental rates, you would likely positively cash flow.

5) 817 N. Humbolt #215 (Woodlake Condominiums). This is a 1 bedroom/1 bath unit in Woodlake, what I think is one of the nicest condominium communities areound. The unit is priced to sell at $369,000 and things at Woodlake hold their value well. If you buy a unit and want to upgrade to a single family home later, you can certainly consider keeping your Woodlake unit and renting it. There is always a rental market there and the Association manages the properties very well. Woodlake has several pools, tennis courts, a gym & clubhouse as well as an active community.   As far as condos go, this is a good investment.

Top 10 Deadly Mistakes Buyers Make….

1) Shopping for a home without being pre-approved for a loan.

Please take the time to speak to a lender before you start shopping. This will make your life easier and determine the price range you can afford. A good Realtor can refer you to a mortgage professional.

2) Not getting a home inspection.

Trying to save money can cost you money. A qualified home inspector can detect issues taht buyers may overlook.

3) Limiting searches to open houses, ads, and the internet.

Many homes listed on the web, in ads, or even homes held open have already been sold, or are pending sale. Your best “in” to the market is to have a Realtor working for you. Realtors have information unavailable to the general public and are a valuable resource for other professionals that can make your purchase happen.

4) Choosing an agent who is not commited to forming a long-term relationship with you.

A Realtor should be another professional you have for the long term, like your lawyer, insurance agent, CPA, or financial planner. A good Realtor is one who is commited to you before, during, and after the sale, and one who provides ongoing  market information regardless of whter you are buying or selling.

5)  Thinking there is only one “perfect house” out three.

Buying a home is a process of elimination, not selection. New properties arrive on the market daily so be open to all possibilities. Ask your Realtor for a comparative market analysis as well as other current market data for any home you are interested in.

6) Not considering long-term needs.

It’s important to think ahead. Will the home suit your needs 3-5 years from now?

7) Not examining insurance issues.

Purchase adequate insurance. Advice form an insurance professional can get you the answers you need. Again, a good Realtor can provide you with referrals.

Not purchasing a home protection warranty.

This is essentially a mini-insurance policy that usually lasts for 1 year upon close of escrow. It covers basic repairs (particularly for appliances) that you may encounter and can be purchased for a nominal fee. Talk to your Realtor about the plan you will need. Some agents will purchase this for their clients.

9)   Not knowing total costs involved.

Early in the buying process, ask your Realtor or lender for an estimate of closing costs. Often referred to as a “net sheet”, this will include title fees, any applicable attorney fees, Homeowner Association fees, insurance, credits, etc.

10) Not following through on due dilligence.

Buyers should make a list of any concerns they have about such issues as schools, power lines, crime rates, environmental conditions, neighbors, etc. There is no such thing as a stupid question and they should be addressed before making an offer. Dilligence will ensure confidence in your purchase.

Get Off the Fence!

Each week I meet prospective buyers looking for homes on the mid-Peninsula. They know interest rates are still low and they have good high-paying jobs which would qualify them for a mortgage based on the tightened lending standards. So why are so few of them not “pulling the trigger”? I ask them what they think  and the most common answer I get is, “we think prices will fall further”.

Don’t get me wrong, we all want a good deal but let’s discuss the reality of the housing market on the Peninsula. Because it’s never been a better time for a deal!

1) You cannot time the market. Let me repeat that…you cannot time the market.

When looking to buy (or sell) a home you must keep your focus on the here and now. Sellers must realize they will not get their home sold at 2005 prices and buyers must realize that when you’re in the market, you must work within the current parameters. Speculating on what happened last year or “what might happen” in 6 months is not going to serve you. Work with what’s happening RIGHT NOW. That’s all you can do. And right now is a great time!

2)  Home prices in this area are not likely to “fall further”. At least not in the mid-sector of the market ($700,000-$1 million).

If you’re reading the national media, stop. Because it doesn’t apply here. Why? We don’t build new housing on the Peninsula. Supply will always be tight, demand will always be high. The San Mateo County Times reported on the market a few days ago and communities like San Carlos and Menlo Park  have seen appreciation over last year. Other communities have seen a price softening which has more to do with sellers pricing their listings too high than a loss in value.

3) The Peninsula housing market tends to hold its value. 

We are located between San Francisco and the Silicon Valley. Hubs of employment. People come here to work and they buy property when they come. Our schools tend to buoy value and so does our proximity to open space. People place a high premium on these factors and they always will.

4) Buyers are afraid to write offers below asking price.

 This is a shame. Often sellers still have stars in their eyes about what their home is worth. Particularly folks who have not updated their homes in 20 years and look to retire on the sale of their property….I call it the Summer 2005 complex. Despite their agent’s best efforts, sellers can still be a bit overzealous. And they are emotionally attached to their home. But these are the properties buyers will see most often; it’s the sweet spot of properties for sale on the Peninsula. My advice? Talk with your agent about the true value of the home; look at sales comparables, hash out the numbers related to doing updates, and consider the nuances of the property and the neighborhood. Then come up with an offer. What’s the worst that can happen? Trust me, sellers want to work with you.

Qualified buyers are in the driver’s seat right now. There are less of you out there (we lost about 15% of them with the credit shake-out), sellers are more flexible, interest rates are still very low and value in our area remains high. If this doesn’t get you off the fence, nothing will! 

Hope to see you ou there! 

Top 5 Real Estate Buys week of May 5, 2008

 

There are some great real estate buys in San Mateo County right now. Each week, I’ll  feature 5 that I think buyers should consider. They will not always be right for everyone, and I will try to cover several price-points and property types.  I will base my criteria on neighborhood comps & historical value trends, the neighborhood’s long-term investment potential, and the home’s long-term investment potential. Now more than ever, I encourage buyers to see beyond the obvious. Remember that neighborhood trends are changing, and “deals” are relative. The best “deals” are homes that need some improvement.  If you want a home that’s fully remodeled, you will pay top dollar! Remember, you can contact me if you want more info or need an agent. It’s what I do…

1) 2736 Monserat, Belmont. Listed by Michael Ames at Cashin Company. This is a rare bank owned property in Belmont. It’s pretty much move-in  ready and needs upgrades that are almost all cosmetic. 1190 sq feet and a private, wooded 5,000 square foot lot with a nice private front yard. Listed at $779,900 in a neighborhood with comparables as high as $1,500,000. Lots of upgrading to homes in this area and the Belmont Schools are excellent. This is a no-brainer.

2) 2660 San Calos Ave. San Carlos. Listed by Bob Hintz at RE/MAX Today. This property is owned by a family trust and the sellers are anxious to find a buyer. It’s got a long driveway set up from the street and it’s within walking distance to the Arundel school, Tierra Linda middle school and Carlmont high school (San Carlos schools are stellar and Carlmont High is one of the best in the region). It has a huge 7,000 sq. foot lot with mature trees and expansion potential. The hardwood floors have been covered by carpet so they’re in great shape and the home is summy & bright. Lots of house at an amazing price; $749,000. Believe me, that’s a deal.

3) 346 Grand Street, Redwood City. Listed by Brendan Royer, Cashin Company. This classic 1930’s bungalow is located in the heart of Redwood City’s Mt. Carmel neighborhood; an area with some of the best architecture on the Peninsula. It’s unually large for the style (2010 sq feet), and the lot is 6500 sq feet.  Close to parks and schools. After a recent $100,000 price reduction, it’s listed at a great  price.  Right on the money at $899,999.

4) 634 26th Avenue, San Mateo. This is a great starter home listed by Max Lo of the Green Banker. Its a 3/1 west of the Alameda de las Pulgas. Great Schools (Meadow View Elementary, Abbott Middle, and Hillsdale High), all within walking distance. Priced well at $849,000, patricularly for the location. You can find similar listing prices in far less desireable neighborhoods. It’s nicely updated; perfect starter home or move-down home.

5) 104 Haight Street, Menlo Park. Listed by Jessica Eva at RE/MAX Today. This is a bank-owned property that fell out of escrow because the buyer chickened out. Too bad for him, because it’s one of the best deals I’ve seen in a while. a 10,000 square foot corner lot in the Willows neighborhood of Menlo Park. The home itself is a tiny 910 sq feet and you would want to add on. Not move in ready, needs work, but this neighborhood comps at $1,500,000 and the Menlo Park schools are FANTASTIC. This neighborhood is full of old ranchers that are being remodeled. The list price of $609,900 is essentially dirt value.  Nothing but potential. Hold it and watch your money grow.

Just a kid from San Carlos

Welcome! Well, I’ve finally joined the blogosphere. Odd that I’ve resisted it, really because I tend to have a lot to say and my paper pile of local facts and tidbits is getting out of control! I started this blog not only to inform readers about the diverse and competetive real estate  market on the Peninsula, but also to share thoughts about this amazing place.  from my very local and sometimes, nostalgic perspective.

I grew up in San Carlos after my family moved down from the city in 1972. My mother wanted her children to experience the sun….so we moved to San Carlos and lived at 139 Brook Street, an idillic cul-de-sac off of lower Brittan Avenue. I walked to Brittan Acres and attended CCD across the street at St. Charles.  Laurel Street looked very different then.   There were 3 movie theatres in town; the Laurel, the Carlos, and the Tivoli (building which is now Town Restaurant). We had a high school up on Melendy Drive and the elementary school district had  school busses! ok, Now I’m really dating myself…

In 1974 my parents bought a house at 2149 Carmelita Drive for less than $30,000. It was (and still is), a 3/2 on a wooded lot built in 1940. I transferred to Arundel and then went on Tierra Linda. My dad sold that house in 1981 and we moved right behind it on Dale Avenue. Bought a 2800 sq. foot new build that Mike McCrary constructed. He built a lot of homes in San Carlos at the time.

My how things have changed.  As of Q1, 2008 the median home price in San Carlos is $1,190,000, there are no movie theatres in town, and much to the community’s chagrin, no San Carlos  High School. Progress? I dunno. Laurel Street is getting pretty hip and people actually come here for some night life.  The Palo Alto Medical Foundation is going to build a campus here. Not bad for our economic future.  San Carlos, like the rest of the Peninsula will be experiencing growing pains for the next several years. Lots of change. But it seems to me one thing will remain firmly in place; our excellent property values!