Tuesday, November 12, 2013

Finally, The Solar Graphic

For new readers, I've been reporting on our experience with new solar panels on our southwest-facing roof these last few months.  I'm having a bit of trouble managing the graphic transfer from PGE's website to this newsletter, but see below:

The blue line is our electric consumption; red is the ''typical home,'' and yellow is ''the typical efficient home.''   The college students left at the end of this data series, so that's not the explanation for the rather steep drop!  Our electricity consumption has dropped precipitously since the solar panels finally got connected (about six months after we signed up, by the way).  Their use pushes us from the expensive 36 cents a kilowatt hour marginal rate to the 13 cents a kilowatt hour rate, so we're using less net electricity, and that which we're using is much cheaper on a unit basis.

We need more months with the numbers, but so far, so good!  This last month, we saved quite a bit more than the promised $135/mo on our bill--and that represented a 4% risk-free (?) return on our investment.  See the last page of http://www.icebase.com/dbadmin/print.pl?FirstMailingList_2Q13 for the graphic.

The Health Care Act

My nurse practitioner sister sent this <a href=''http://kff.org/health-reform/video/youtoons-obamacare-video/''>link</a> to the family (there are nine of us kids and about 35 grandchildren).  It's a nice useful primer, and of course everyone who already has insurance sees no change.

(If you're dying to find out more about my unusual past, <a href=''https://sites.google.com/site/aboutmaureenkennedy/my-past''>click here</a>.)

Government Shutdown Impacts on Housing

Some of you may not know that I was working for the federal government during the last shutdown.  After serving as Deputy Assistant Secretary for Policy under HUD Secretary Cisneros, I moved over to run the Administration's rural housing and community development loan programs as head of “Farmer's Home,” managing 5,000 staff, 1,700 local offices and a $4 billion loan portfolio for single- and multi-family housing and community development loans.  We cut the agency's appropriation by about 40% by centralizing loan servicing, closing many offices, and shifting from a 1% loan for all eligible homebuyers to a sliding scale loan ratea shift long overdue.  Our entire staff--from top to bottom--was on hiatus for those weeks.  I could not get into the building.

These days, nearly all loans (and re-fis) require some government involvement before closing.  Buyers assert net income based on tax returns, but the lender has to check with the IRS, which is on hiatus, for accuracy before closing a loan.  So for now, most loans that Fannie Mae or Freddie Mac will buy are on hold, any FHA (low downpayment) loan is on hold, and many jumbo loans are on hold.  And all those home sales are correspondingly on hold, along with any other sales which depend on these sales closing.  Home sales are abstract when they don't involve you, but know that some of your friends and neighbors are really feeling the pinch during this shutdown.  When the IRS gets back in business, they'll have a backlog; we'll need to be prepared for some delays then as well.

Gutters Clear? Furnace Filter Changed?

I talk to my buyers about ''the small chance of a big problem.''  Stucco houses without deep roof overhangs and with clogged up downspouts can sometimes shift rainwater back behind the stucco and down the ''inside'' of the house's skin.  Over the course of 80 years, the framing can rot.  And you have to take all that stucco off--and put more back on--as you fix that problem.  Bills in the 40k-100k range are not as uncommon as you'd like to think.  Best way to avoid that small chance of a big problem is to clear your gutters of leaves from surrounding trees.

Right now is a perfect moment--that windstorm last weekend brought down a bunch of debris, and you'd like to get rid of it before the first rain shoves it down the downspout.

Two of my ;local favorites are Mr. Sparkle, and Gorilla Gutters.  Mr. Sparkle is offering $20 off right now.  They'd suggest you get the job done twice a year, but I bet for many of us, it's been a decade since the gutters were cleared.  Do it now!

And don't forget <a href=''http://www.airfiltersdelivered.com''>airfiltersdelivered.com</a>--it's the Costco for your furnace's air filters, and you don't have to deal with the Costco ''thing'' to get them.

They show up on your doorstep.

And you get friendly reminders to change out your filters every 90 days or so (don't tell anyone that I change mine every year, though it does fill up with dog hair.....).

I spent 2 minutes ordering a dozen two weeks ago, and they arrived like affordable magic on my door step last week. Again, I bet for many of us, the air filter hasn't been changed since you moved in.  A furnace serviceperson told me recently that really dirty filters can make your furnace work harder to do the job, shortening its lifespan.  So really, order several, take 30 seconds to change it out (I'll even come over to show you where!), and get with the program.

Those Nest Folks Just Don't Stop!

You've followed our experience with a <a href=''http://nest.com/thermostat/life-with-nest-thermostat/ ''>Nest</a> thermostat installation.  When you open the box, you feel just as you did when you opened the box containing your first Apple laptop.  I still love holding the screwdriver they included (hey, it comes in handy!).  And I look forward to lots of energy savings this coming heating season.

Well, they sent us all a preview of their newest product--a combined smoke and CO monitor.  Not inexpensive ($129), it can be turned off (when burning toast) with a wave.  Gotta like that.  But the big ah-ha is that it links to your laptop or iPhone.

I'm less confident about the value of that functionality, but I swear to god that if my communication skills ever rival theirs, based on this <a href=''https://store.nest.com/product/smoke-co-alarm/#meet-the-nest-protect''>video</a> on the product, I'll die and go to heaven.

By the way, CA requires a CO monitor on each floor and a smoke detector on each floor and in each bedroom at sale, so relying on these Nest monitors would not be not inexpensive.  But for an older home without good coverage, or in other parts of the country, an integrated CO/smoke detector is a really good thing.

The Plant Sales Are Coming Up

The Merritt College sale was last weekend, but there are still a few Bay Area non-profit plant sales around the corner.  See <a href=''http://www.stopwaste.org/home/index.asp?page=1269''>here</a> for more events coming up--a great way to get new and unusual plants--marionberries or olallieberries anyone?

The Big Picture

I represent buyers as well as sellers, so I've seen the craziness of this year's market on both sides.  (And we sold our Pala Avenue home this spring--for 25% over the asking price [I took my agent's advice to the letter....].)

As discussed in the last newsletter, my sense is that we had tremendous pent up demand, which was released once the received wisdom was that the crisis had ended.

Buyers flooded into the market and sellers, who typically take longer to get in gear and get a house on the market, did not flood the market with offerings.  Cautious savers, who had banked cash preparing for the worst, wanted to put their money to work again, and the beaten down real estate market looked like a great opportunity.  Buyers bid prices up dramatically.

Because appraisals are backward looking, sellers stayed cautious and took the fast-closing and slightly lower all-cash offer rather than risk that an appraisal might come in below the contract price, leading to another round of price negotiations and disappointment.  Homes were sold and now those high sales prices are the new comps for today's transactions.

There still are more buyers than sellers, and all-cash offers still represent about 15 to 20 percent of all sales.  It's still a seller's market.  But we're seeing 3 offers rather than 13, and successful buyers are increasingly able to retain an inspection contingency (which in turn leads to a round of negotiations if the seller didn't cover the inspection bases adequately in advance).

I'm hearing various friends say that our respective college grads are now finding jobs, finally--if the economy is recovering more broadly, those boomerang kids (and their 30s-something elders) will begin moving up the housing ladder again.  And maybe once we feel confident those boomerang kids won't be back, and the house feels more permanently empty, we'll feel more comfortable about “moving down” to a smaller house.--that means more supply.  It's all a balancing act. But this fall (until mid-November) and again next year, just after the Super Bowl when all those young families focus like a laser beam on getting a Piedmont home before school starts, may be great windows to put your home on the market.  Give me a call so we can start planning!

The Piedmont Update

After a few quarters of rapid price increases in Piedmont, we saw an appropriate pause this last quarter--the average home sold for $1.486 million in the 3rd quarter (compared to $1.647 million last quarter and $1.66 million a year ago--the median was quite stable compared to 2Q13).  The average price per square foot was $574 (compared to $630ish/sf over the last few quarters).  Thirty-four homes sold in an average 19 days on the market--still very high market velocity.  The average sales price was 4% over the average asking price.

Homes sold all along the price spectrum--from $675k to $2.93 m.  But several homes priced above the $2.5 million range have languished, or left the market, suggesting real resistance at those high-altitude price levels.   Three homes (as reported by the MLS) have sold above $3 million since the beginning of the year, all larger than about 6,000 sf, and all at $650/sf and below.

As noted last time, increasing interest rates in the late spring have certainly exerted a bit of downward price pressure.  Buyers qualify based on the mortgage payment-to-income ratio, and those mortgage payments now buy less house than they used to.  A couple with $200,000 in downpayment could afford a house worth $1 million at the beginning of the year, but they can afford only a $870,000 house today, if everything except interest rates stays the same.  That's a 13% price drop right there if the seller  were to ''bear'' the entire effect of the rate change.  And we haven't seen price drops of that caliber by any means.

Berkeley has seen very stable prices--the average home sold for $852k (compared to $851k in 2Q13), in about 20 days.  Sales prices were about 12 percent above the asking price, as they were in the ''hot'' spring market.  Median prices were likewise very consistent over the period as was the number of homes sold.

Oakland saw slow continuing improvement between the spring and summer quarters--the average sales price was up about 2.5%, from $515k to $527k, about 8% over the asking price.  The 94610,11, and 18 zip codes surrounding Piedmont, saw even stronger recoveries:  Together, their average prices were up by 6% compared to last quarter, and the average sales price was 10% over asking.  Homes consistently sold in about 20 days, on average, across all of Oakland and in our surrounding areas.

We've talked in the past about how the data would have been skewed by underwater but financially strong owners staying out of the market--if only households more on the edge were forced into selling in the down market, then the average price would reflect their lower price points.  Likewise, we're not clear how these data today are affected by a disproportionate flood of higher income/higher home-price sellers moving into the market.

The Perfect Move-Down Option, Near the Village Market!

Mid-century architecture at its best!  5560 Country Club Drive affords great privacy, level living, quiet radiant heat, easy commutes, plenty of light throughout the day, and calming borrowed views of the Claremont Country Club golf course.

The home radiates out from the light-drenched vaulted central living room--two bedrooms and two baths in one wing; the kitchen (with breakfast nook) and two-car garage in the other wing.  Behind the living room itself is a large private den with half bath and built in wardrobe, perfect for guests.

The combination of boomerang shape and corner lot location creates several large and private courtyards and patios, each with floor-to-ceiling windows.  Organize cocktail parties that spill out of the living room onto the patios on either side! Or relax in the living room, fireplace to the side, facing the southerly bank of windows, oblivious to life's hub bub.

A more convenient location would be hard to find!  Because you're just two blocks from the upscale Village Market, Broadway Terrace Nursery, and Terrace Cafe and Gifts, grabbing dinner or a gallon of milk on the way home (or a latte on the way to work!) is a breeze.  College Avenue's shops and restaurants start just over a half mile down the slope, anchored by the California College of the Arts.  A Wi-Fi equipped express bus to San Francisco's financial district stops right around the corner.  Route 13 is just up the hill, and there are no more exits before the Caldecott  Tunnel.  Continue north a half mile and drop down into Berkeley at the Claremont Hotel, or loop west on Route 24 to Emeryville, Oakland and San Francisco beyond.  The home is in the highly coveted Hillcrest School catchment area (check with OUSD for availability).

See <a href=''http://www.5560CCDrive.com''>5560CCDrive.com </a> for lots more info and photos.
2 bedrooms plus large private den, 2.5 baths
1942 sf on a nearly quarter acre lot
2-car garage and plenty of storage
Open Saturday and Sunday 10/12-13, 2-5 pm, Monday from 10-1 (come for the morning buns) and next Sunday from 2-4:30.