Wednesday, October 8, 2014

Why It's So Tough to Get a Loan These Days

Bloomberg has a nice piece today following up on Bernanke's comment last week that he applied to refinance his loan and was rejected recently.  The story is pretty basic, but covers the "pendulum has swung too far back" issue, the "lenders' job is to find what's wrong with your package" issue, as well as the "our incomes are actually lower now than 10 years ago, on average, so of course lending is more difficult" issue.  This latter point I've not heard paired with the tightening guidelines issue before (though of course folks lost so much equity and savings during the downturn, that downpayments are dramatically more difficult to pull together these days--for instance, 10 years ago, you could buy a $1 million home with $50,000 down, let's say.  Today you might need $200,000 down (a 300% increase, and savings are incredibly hard to set aside quickly!), and your income might be 3% lower, on average (but rates are too, so......).

Tuesday, October 7, 2014

Should I Sell my Home Off-Market?

I don't know why it took me this long to mention this, but this spring, I had a 

client who thought seriously about selling his home off market.  Price was important,
and privacy was not a big issue.  I argued that to get the best price, there's no
doubt the best approach is to stage, market a home very strategically, and open 
it up to the broadest range of potential buyers possible.  You want multiple buyers,
in part to keep the prevailing buyer "in line."  Off market, too often, the sole
 buyer thinks s/he is doing a seller a big favor, and begins asking for lots of 
concessions in return.

Of course I know I'm the agent and you're the principal, so I do whatever you tell
me to do.  In this case, the seller was convinced to list the house off-market with
another brokerage in town.  They opened it up unstaged, to about a half-dozen buyers
working with (only) their agents.  None felt the look of love, and the seller felt
that none was really properly pre-selected (we agents typically will bring all financially
qualified buyers to an off-market listing, in part because our buyers would want
 to get in when others can't (why? They are hoping for a bargain.....)).  The asking
price was x.   No bites.  Not even an offer below asking.

I got the listing a few days later, staged, cleaned up the tax record to reflect
 about 1000 sf of permitted additional space, did a bang-up marketing job, and put
the house on the market shortly thereafter for 93% of x, hoping for x or more.
The prevailing buyer closed with zero complications at 27% over x (and 40% over 

There were a number of extraordinarily strong offers, and the three strongest were
from agents who don't traditionally work in Piedmont--two from Berkeley and one 
from San Francisco.  (You remember my story a few years ago that in a year with 
say 140 sales or 280 "sides," there were something like 200 different agents and
 dozens of firms which had participated in the Piedmont market?)

Enough about You; Let's Talk about Me (and Pacific Union a tad...)

This has been a very big year for me, and for PacUnion. You've probably seen the

graphically striking full-page ads in the Chron pointing out that we have the most
productive agents ($ sold/agent), the fastest growth rate, and the largest share
 of sold over-$1 million homes throughout the Bay Area.  We've also been getting
 great press and awards for our website, and for our big presence in China.
 We have an office there, key staff have made several visits, all our listings are
uploaded to the equivalent there (with text translated of course) and
 our concierge office here handles incoming inquiries ("I'd like to buy x house 
in Piedmont," as well as "I need a Chinese-speaking agent to help me buy my son 
a condo in Berkeley while he's at UC"), as well as advertising opportunities in 
a range of Asian pubs.

Meanwhile, back at the ranch, I've sold a bit under $25 million in real estate in
the past year--85% of it in Piedmont.  Prices have ranged from $665,000 to--oops
 I can't tell you because my clients' offer was confidential, and I never violate
a confidentiality commitment.  A bit less than half involved buyers, and I represented sellers (or renters!) for the balance.

Of greatest interest to me is how I stack up against the "typical" sale.  On average,
homes closed in Piedmont at 8% over the asking price over the same period.  In contrast,
looking at my buyers and sellers, my buyers closed at an average 7% below asking,
and my sellers closed at 24.6% above asking.

You can achieve that kind of performance while being a jerk, yelling and screaming,
and developing a reputation among agents and clients for lack of transparency and
ethics.  Actually, I'd argue that you can't, and have always approached my business
hoping to deliver thoughtful, insightful advice in a collegial fashion while keeping
my clients' interests paramount.  Click here for more of what my clients say.

A Few Garden Ideas

--On Sunset Magazine's site is a nice set of suggestions for great fall color.  Think about shots of orange and purple, combined with waving grasses.

--Are you yet addicted to Gardenista?
 The NYT's Michelle Slatalla's current roost, it's cooler than Sunset, and covers
plants, hardscapes, floral, and has great graphics from correspondents in a few 
locations around the world.  Because it's based here, much of the international 
coverage tends to be in other Mediterranean climates--South Africa, Australia, Spain
and Italy, and so on.

--Been to the Bayview to Flora Grubb's shop?  I hear succulents are heading toward passé, but otherwise, it's a great idea generator.

Bay Area Wide Market Trends--

If you have an interest in property values elsewhere in the Bay Area--thinking about
a move or looking at current values of an investment property--take a peek at Pacific
Union's regional report for 2Q14 (this quarter's report will be coming out soon--keep an eye on this blog (

 Lots of data, and it includes nice insights from the various regional VPs--remember
we have offices throughout the Bay Area and in Tahoe, in contrast to the red guys.....

Also Courtesy of Pacific Union, and Christie's International--

You know Pacific Union is the longtime regional affiliate of Christie's InternationalReal Estate, right?  Christie's puts out a great read every quarter--check the last issue out
 here.  It's not just a compilation of big houses!

Merritt College Plant Sale Coming Up this Weeken

In the middle of a drought, don't forget that natives and Mediterranean plants are

great ways to reduce water consumption in your yard.  Merritt College's non-profit
plant sale happens this Saturday (9-3) and Sunday (12-3) at the College up Campus
Drive.  See for all the details.
Competing for your attention is the Ruth Bancroft Garden's plant sale also on Saturday
11-3 pm in Walnut Creek.

The following weekend is the native plant sale sponsored by the CA Native Plant 
Society, this year on October 18th at Hidden Villa Ranch in Santa Clara (do elementary
school students still go to Hidden Villa for their eco-education overnight?).  October
19th, go local to the Friends of Sausal Creek sale at Joaquin Miller Park 10-4 pm.
 Combine a plant sale and a Lawrence Hall of Science visit by stopping by the UC
 Botanic Garden's sale also Sunday 10-4 pm.  See their blog for more info.

Need a Middleman for a Parent-to-Child Home Loan?

Longtime readers of this blog will remember Circle Lending, which took care of the
paperwork for private loans, and Virgin Lending, which bought Circle Lending just
before the crisis, and then folded shortly thereafter.

Looks like National Family Mortgage has gotten organized to fill the void, per Kathleen
Pender's Chron story in July.  They charge $725 to originate the loan (set up, record
and handle 1099 forms at the end of the year), and then there's a separate $15/mo
servicing charge (to cover sending out monthly mortgage payment bills, letting you
know if a payment issue comes up), which can be paid by the lender or borrower, 
at your direction.

Note that if you were to "gift" funds to a relative, you are liable for gift taxes.
 The IRS has a "Applicable Federal Rate" which is a safe-harbor rate that avoids
 any liability.  It's currently just over 3% for a long-term loan.  So while market
rates are closer to 4.375% for a 30-year loan, you could lend a relative at 3.06%
and not worry about whether a portion of the arrangement would be considered a gift
by the IRS.  The program allows you to set the rate at whatever you agree on.
See their site at, and/or check out a guide to borrowing at this site. 
By the way, I've turned a few clients who are not yet ready to buy or sell onto 
the IRS's taxpayer guides to buying and selling.  They have great FAQs and scenarios.
 (I send these links out, along with the settlement sheet from transactions, to 
each of my clients on 12/31--who wants to go hunting for that one piece of paper
 when organizing for taxes when I have it tucked into my "settlement sheets" file
at the office?)  See this site/doc for potential buyers and this site for potential sellers.
 Is that new roof a expense related to the sale or an addition to basis, or neither?
 What about an upgrade from vinyl to hardwood in the kitchen?  Can you deduct transfer
taxes?  Loan points?  The answers might surprise you........  As always, talk to your tax professional first and last!

Top Ten in the Country--Two Miles Away

Real estate blog Curbed highlighted the American Planning Association's selection of the Uptown neighborhood of Oakland as one of the top ten neighborhoods in the country. Read more about it and other coolest neighborhoods here.  

 Note to calendar:  Add next month's Art Murmur.  See the Art Murmur site
for arts listings and First Friday events for next month--

3Q14 Piedmont Real Estate Update

3Q14 Piedmont Real Estate Update---
The third quarter of the year maintained the sales trends from earlier in the year, and represented a big jump up from the third quarter of 2013.  The average list price this quarter for the 37 homes closed was $1.858 million, and average sale price was $1.989 million.  Before shock sets in, compare that to the median price trends:  The median asking price this quarter was $1.495 million, and median sales price was $1.775 million.  I rarely include both sets of data, because they so rarely diverge to this extent.
There's a clear reason, however:  3Q13 saw a highest price of $2.93 million--and
that was about the max for the previous several years.  The very high end of the
market had seized up during the crisis.  In contrast, in the past year, a large
number of high-end homes have come to market and closed (though fully 1/3 of homes currently on the market in Piedmont are priced at over $3.5 million, suggesting buyer demand is not bottomless.)
This quarter we saw not only a highest sale price of $5.45 million in Piedmont (as reported by the MLS...), but there were four sales over 3Q13's max.  That is, with actual sales to review and fold into the averages in the over-$3 million range, our average sales prices spike up.
Circling back, these figures represent a 17% increase in prices this quarter compared to 3Q13 on a median basis (which I would focus on), and 34% on an average sales-price basis. Across all sales this quarter, the average sales price was 7% over the asking (the median was 19% over asking).   Homes sold in a typical 15 days on the market, and for $670/sf (average $669/sf and median $671/sf).  As I pointed out to buyer clients just today, don't consider $670/sf to be what you'd expect to pay for most homes in Piedmont, however.  Those homes that punch many buyer buttons--those that are recently renovated in an of-the-moment style (see below for more on that!), include a master bath, have all bedrooms on the same level, include a family room, preferably that kitchen/family room opening onto a large andflat backyard, and a location walkable to both schools and Piedmont Avenue, the prices have consistently been closer to $850/sf or more.
Putting these stats in the context of last quarter's data--the prime sales window
in Piedmont--the market has consolidated its gains--buyers are thankful we are at
a bit of a plateau rather than still on that steep upward slope:  Last quarter, 65 homes sold for a median price of $1.758 million--nearly identical to the median this quarter.  The average sale price then was $1.884 million (compared to this quarter's $1.989m).  
Pulling back to the regional and statewide data, the Ca. Association of Realtors
 reports that prices across Alameda County are up 9.2% July over July (on a median sales price basis).  Check out a new app that the CAR has introduced if you're interested in looking at pricing trends (and other sales stats) in other counties in CA.  Across the state, median prices are up 8.9%, and the total number of sales was down by 9.3% on a year over year (through August) basis.  This supply shortage of available homes certainly contributed to price spikes earlier in the year, but it appears that more sellers are motivated to put homes on the market (or are able to sell and not bring money to the table) because we see total inventory is increasing these last few months.
In addition, those Facebook and other IPO beneficiaries who had money burning a 
hole in their pockets have blown their wad, so the crazy money is not nearly as 
significant a factor today as it was earlier in the sellling season. (On the other hand, with the exception of one bizarre situation in which I was involved, homes are invariably appraising for the contract sales price--the all-cash and way-over-asking prices from the early- to mid-summer are still considered legitimate comparables today.  If you've been postponing a re-fi for some reason, there's no reason to wait, as appraisals will be successful, and interest rates are finally creeping up.)
And finally, at the national level, my contacts at the Institute for Luxury Home Marketing (I won a national marketing award several years ago at this Dallas-based organization's annual conference--the only conference typically on my calendar suggest that high-end properties across the country are seeing some price pressure.  Click here for more national stats focused on the high end, generated by the same vendor who provides detailed info on the Piedmont market when I organize open houses for my listings.
Anytime you  need more insight into local or regional housing trends, just let meknow. I appreciate the opportunity to review stats and market trends through the quarter--it helps inform my thinking, gives me something to talk to clients about, and certainly ensures that I operate in a data-driven manner, rather than relying on my gut only!

Thursday, October 2, 2014

Getting Organized for Events over the Holidays? I Am---

Today I polled my colleagues for caterer ideas for a holiday event at our house for my spouse's office.  Here are the responses, in no order:

-Lois at Edgeworks,

-Susan Wong, formerly of Lalime's, 510.967.4136

-Blue Heron Catering (510) 533-0781

-Barbara Llewellyn
Telephone: 510.832.1967
Facsimile: 510.832.0419 (looks like she does teambuilding events built around one-day cooking classes too)

And for most creative (and thrifty) idea: 

-Get food from Ann's Catering (of Rick and Ann's) and use Hostess Helpers ( to can do the actual staffing. 

Thursday, August 7, 2014

East Bay Market Update from Pacific Union

If you want a handle on pricing trends throughout the Bay Area, see .  The report shows brisk sales throughout the area.  At our most recent staff meeting, multiple offers still represented 77% of all sales; about 20% of sales are all-cash, and the number of sales is up compared to this time last year.  Key difference--more buyers are "in the market" now compared to last year--due to perceptions of brightening overall economic prospects or better personal financials--and that's why prices were driven up.

Tuesday, July 15, 2014

Need a Middleman for your Parent-to-Child Home Loan?

Longtime readers of this blog will remember Circle Lending, which took care of the paperwork for private loans, and Virgin Lending, which bought Circle Lending just before the crisis, and then folded shortly thereafter.

Looks like National Family Mortgage has gotten organized to fill the void, per Kathleen Pender's Chron story this am.  They charge $725 to originate the loan (set up, record and handle 1099 forms at the end of the year), and then there's a separate $15/mo servicing charge (to cover sending out monthly mortgage payment bills, letting you know if a payment issue comes up), which can be paid by the lender or borrower, at your direction.

Note that if you were to "gift" funds to a relative, you are liable for gift taxes.  The IRS has a "Applicable Federal Rate" which is a safe-harbor rate that avoids any liability.  It's currently just over 3% for a long-term loan.  So while market rates are closer to 4.375% for a 30 year loan, you could lend a relative at 3.06% and not worry about whether a portion of the arrangement would be considered a gift by the IRS.  The program allows you to set the rate at whatever you agree on.

See their site at, and/or check out a guide to borrowing at this site.

Friday, July 11, 2014

If You're Under 50, You Still Hafta Read This---

You might have noticed my reference last week to "AARP-certified"--a young buyer
 came into a recent level listing and said "my mom said this home was AARP-certified."
 What a great concept.  For the last few months, coincidentally, I've been making
my way through The Accessible Home by Deborah Pierce (feel free to contact me [mailto:Kennedy@MaureenKennedy.Net]
to borrow it).  Pierce creates a roadmap for owners looking to accommodate:

*  regular visitors with accessibility challenges (I regularly hear "this house 
won't work for us--my mother can't handle all those stairs when she comes for dinner"),
* themselves at all ages,
* a disabled child, or
* a disabled partner.
 Her mantra is "Universal Design Equals Intelligent Design," and she's so smart! 
 Think about how much easier it was/is to use strollers on corners with curb cuts
ostensibly for wheelchairs, or to change diapers in the disabled bath stall.  And
think about how many of us are likely to be inviting our parents into our lives 
and households in the coming years.
 Much of her thinking looks at changes you can make (or plan in a renovation) that
are great now, but lifesavers later (and think about the costs if you had to move
because a home no longer met your needs).  Asking the right questions is as important
as the anticipated needs you plan for.
 Key insights for all of us include:
 --Closet planning can increase efficiency by 60%.
--Knobs are a problem; cabinet pulls and door lever handles are not.
--Pocket doors (and "barn" doors) can be really useful in avoiding do-si-do routines.
--Low maintenance layouts and surfaces are good for everyone.
--Can everyone get out safely in an emergency?
--Changes in stone or pavement color (slate to concrete) can signal surface or slope
shifts, particularly for the visually impaired.
--Drawers for the fridge, for pots, for files are easier for everyone to access,
 as are side-swinging oven doors (Gaggenau has had them for years).
--Think about easy and rain-protected ways to get folks out into fresh air--level-out
decks, etc. turned me onto the notion of placing shower controls in  a location
that doesn't involve your getting wet every time you prep  for a shower (try doing
that in a wheelchair!)
--Bay windows are another way to create "elbow room" in tight spaces.
--Think about dual purpose grab bars/towel racks.
--Planning in laundry rooms and mud rooms is key.  There's a lot of maneuvering 
that goes on in each, and a washer and dryer in the basement is a pain for everyone,
including kids who can otherwise help out.
--In-bath storage.  Use for linens now, and various medical supplies later.
--And what about a bidet after all, for keeping things clean?  Those Japanese toilet
retrofits (Google "Toto Washlet") work really well.
--Don't forget the needs of a caregiver (my new listing at []
provides a great private housing arrangement.....)
 Lofts can often be just the ticket--they typically involve elevators, low-maintenance
concrete floors, wide spaces and modular functionality.
 Note that the City of Piedmont, when recently overhauling its zoning code, added
 a "reasonable accommodation" reg.  Historically it was very difficult to get a 
permit for otherwise-prohibited renovations needed for various disabilities--say
 to convert an existing half bath to a full bath in order to allow an owner to live
comfortably on one floor, or to expand an entry porch roof into a setback to provide
a sheltered area for someone to get keys to open a door.  And frequently these adjustments
had to come out when the owner sold the home, even though that meant the home again
became less-accessible--a particular problem in Piedmont given that our housing 
stock is so old, on average.  Now, the City "may" require that the space be returned
to its original status, or it "may" leave that more accessible home as-is for future
owners.  See Chapter17.22.a []
of the City code for more.
 And finally, I've mentioned it before at Margie Bowman's suggestion, but take a 
peek at North Oakland Village []
for thoughts and resources on how to stay in your home longer--assuming that's your
preference.  If you're happy to move, just call me and we can make that happen too!

The Piedmont Update

Well, the strong market continued apace this quarter--in contrast
to reports elsewhere, we had 63 sales this quarter, compared to 42 for 2Q13.  Average
sales price was $1.903 million (usually I stick with median, but this quarter's 
number is skewed up by a few large sales.  Even so, the median was $1.743 million).
 The average price per square foot was $661/sf (appropriately excluding several 
sales which show as $0 for privacy reasons....).  This compares with $600/sf for
 us at the top of the market, and about $635-$650/sf over the course of the past
 year.  So we seem to be at a new plateau about 10% above the previous market highs
(though note that's 10% appreciation over 8 years.......).The average days on market
was 16 (12 was the median).  For hotly contested properties, we're typically seeing
sales on the Friday of the first week, unless the seller commits to a second open
house weekend.Anticipate that the market will remain active as buyers try to get
 into the market before the beginning of school. 
Sales tend to drop like a rock
 through August, however, and then pick up again for about 6-10 weeks after Labor
Day, before the holiday lull sets in.  Yesterday's strong economic data may suggest
that this unexpected window of unusually low interest rates is about to end--as 
rates climb, homes become marginally less affordable--the same buyer can no longer
afford your home as their payment rises. 
Be sure to contact me (Kennedy@MaureenKennedy.Net)
for any additional insights on the Piedmont market, or if your friends, family, 
or colleagues want to buy or sell in the East Bay market.  I've closed nearly $25
million in real estate in the past year, ranging from the most expensive sale in
 Piedmont that was on the MLS to the least expensive home closed in Piedmont this
year.Enjoy the long weekend!

I Know It's Not My Listing, But......

I Know It's Not My Listing, But--

Let me mention one of my favorite homes in Inverness, coming on the market this 
weekend, and owned by Piedmonters and Kensingtonians.

125 Vision Rd. Is just a short distance from the tennis court, Inverness Yacht Club
(shallow draft so we're talking kayaks and small boats here....), and downtown Inverness,
including the very well reviewed Saltwater Oyster Depot [].
 Newly high-end grocer Perry's Deli []
is a couple miles towards Olema (location of the Manka's team's new Sir and Star
and Pt. Reyes Station (think Osteria Stellina [],
the Dance Palace [],
Pt. Reyes Books [],
and Cowgirl Creamery []).
  And Kehoe Beach in Pt. Reyes National Seashore, the best dog-walking beach on 
the Pacific Coast, is about 12 minutes away by car-I just got back from my hourlong
Sunday constitutional there as I write this.

See here for the view. []

Formerly owned by the Cheda Garage family, the house was the new new thing in 1957--it's
one of only a few--I can't think of another--mid-century modern homes in town with
a classic south-facing horseshoe shape.  The large living room is bracketed by a
 classic fireplace, and the interior courtyard which draws plenty of light into 
the home.  Totalling 3 bedrooms and 2.5 baths, with a large garage with interior
 access, it's set on a half-acre lot with heirloom apple orchard already in place--I've
made "Apple Trees at Olema" apple jelly for the garden club's scholarship fundraiser
with permission of the owners and poet-laureate Robert Hass.

And did I mention the steel-reinforced foundation that would have been de rigeur
 in 1957?  And the new roof?  And the dog- and toddler-friendly privacy fence? And
AARP-certified level-living? And 1 hour 10 minutes from Piedmont?

Get into town before the Inverness Fair in early August!  Open this weekend by appointment
and next.  See for more.

1119 Warfield Ave. Open just after the Parade--
 If friends or colleagues are looking to simplify life, consider 1119 Warfield Avenue,
 Architectural Details Abound
 At the top of a knoll with a flat front yard, the home affords long views facing
 towards the south.  Enjoy the barrel ceiling in the living room and other architectural
details of this Mediterranean-style home-from coved ceilings, to crown molding, 
to ornate fireplace surround, to banks of windows that let in the East Bay's famous
 When you're ready to entertain, the formal dining room beckons, but start with cocktails
on the private front patio.  The split-level layout works very well:  a master suite
and two bedrooms sharing a bath are a few steps up from the public rooms, while 
the rare family room and guest suite (plus interior access from the garage) are 
a few steps down.  A total of four bedrooms and three baths!
 The Perfect Location
A better more walkable Piedmont location would be hard to find.  Just a block and
a half from Wildwood Elementary,* with the middle school, high school and dog-friendly
Piedmont Park on the other side of the football field, students can head out to 
school 10 minutes before classes start.  Or walk with them and stop at Mulberry 
Market for a latte, on your way to the casual carpool or Wi-Fi-equipped express 
bus to San Francisco's Financial District. 
Wildwood Elementary has recently completed a seismic update, and ranks 10 out of
10 on the state's API scores.  The elementary school offers before- and after-school
care run by the Recreation Department on-site-and summer camps are well-organized
and easy to coordinate as well.  Piedmont High School is rated #200 in the country
in US News and World Report's 2014 survey of public schools last year (and by far
the smallest of the very few Bay Area schools receiving the Gold ranking), and is
just a few blocks from the home. 
This summer, enjoy Piedmont Community Pool for long afternoons or swimming lessons. 
 The current owners have made a number of improvements over the years, including 
the installation of Andersen dual-paned windows, seismic retrofit, sewer lateral
 replacement, Kohler low-flow toilet replacements, recent roof tune-up, and paint
inside and out.  Not one but two 40-gallon hot water heaters help ensure that showers
never run cold (the plumbing lines are copper).
 *Check PUSD for availability in the fall.
 --4 bedrooms and 3 baths in 2148 sf (per assessor)
--4452 sf lot (per assessor)
--1-car garage (check for size)
--Seismic Retrofit
--200-amp electrical service
--copper plumbing
Open Friday 12-1:30pm, Saturday & Sunday 2-4:30 pm
Broker's Tour (public welcome) Thursday AND Monday 10-1 pm
Offered at $1.195 million.

Renting--or Lending--Out your Home

My daily indulgence is Remodelista, and this week they're focusing on summer rentals, Air BnB, VRBO, and visits to friends--cool ones locally, dramatic ones the world over, hostess gifts, and so on.  Today however, they have a killer list of things to include in your "How the House Works" memo to guests.

You may know that we don't rent out the Inverness house, but do donate it annually to a range of local charities (Tri-School Fundraiser, Camp Augusta, Family Law Violence Center, Berkeley City Club's foundation, Rubicon to name a few). 

Between those folks, and family friends whom we invite to use it when we know we'll be away, there are lots of people who need to know not to even think about putting linens in the washer (because of the high likelihood they will not get in the dryer and thus will be a smelly mess when we arrive a week later.....), and absolutely need to know the WiFi password, how to rarely use the garbage disposal, and where to put compost.   And we've always had a 7-page memo that covers all this and more (kudos to the contractors; best local restaurants).

Our memo performs well when compared to the pro's!

Here's the link:  Remodelista Renter Info Checklist.

Thursday, April 3, 2014

Don't Forget the Homeowner's Exemption!

I glanced at our tax bill recently and realized the Assessor's Office didn't have our homeowner's exemption reflected.  It's only $7000, which is a savings over investor-owned property of only about $70/year, but still.  Take a peek at your next tax bill, and if you don't see the $7000 exemption, reach out to the Alameda Assessor's Office.  They have a commonly searched forms sub-site, but it doesn't include this one, which would reduce your taxes!

And Now onto the Market

We currently have 15 homes on the market--and none has been available for more than 28 days.  We have 11 homes currently pending, and with one exception, none was on the market for longer than 19 days.  More than half received multiple offers.

In contrast, across the quarter to date--nearly three months!--we saw only 18 homes sell, and they sold in an average 50 days.  That means the market is ramping up rapidly.  At present, the quarter's sales averaged $1.961 million ($547/sf), with a median of $1.635 million (after excluding one whose sales terms are confidential). 

These figures are skewed by several things: 

--Seven of the 17 homes sold for more than $2.5 million--it's been a very long while since such a flush of high-end homes actually found a serious, bankable, willing buyer.  These sales pulled the average and the median sales prices up.

--On the other hand, a number of the 18 had been on the market for a long while, and sellers ''got serious'' in the quiet period at the end of the year or as the new year began.  These so-so results actually closed in 2014, leading to the high days-on-market statistic.

--In fact, with one exception, all the homes that found a willing buyer after more than 23 days on the market sold for below the asking price, while those that went into contract in 1 or 2 or 3 weeks tended to garner the multiple offers and sell for more than the asking price--at an average of 10% over the asking price, and $649/sf.

Because there were so few sales in the first quarter, and because the group was so skewed in various ways, I won't compare these figures to those of the last few quarters.  But clearly, with all the activity here at the end of the quarter, we'll have plenty of broadbased data to review in the coming few months.

I'll send out the final data for the quarter in a few weeks, along with the basic data on each sale as in the past (excluding the street numbers!  We have little enough privacy as it is in this town!)

Cul-de-Sac Living in Central Piedmont

16 Keefer Court offers a rare cul-de-sac setting close to all three levels of Piedmont's prized public schools, as well as a number of recent systems and structural updates.  Comprised of three bedrooms and two baths in nearly 2200 sf, the home offers a large main-level family room that's very unusual for homes from this era.  [And that's a barrel ceiling flattened by the photo lens, not a flat ceiling curved by the lens!]

Handcrafted Details Abound

Designed by regional architect Ray Keefer, the house reflects his deep understanding of the Mediterranean aesthetic, and his typical high quality finishes--gorgeous 2-inch oak parquet floors in the living room and entry, graceful barrel ceilings and proportions, and wonderful original hardware.  The many windows and skylights let the famous East Bay sun pour into this southwest-facing home.  Gracious french doors open the large living room and formal dining room to a fig-tree shaded patio perfect for outdoor dining or BBQs.  And the front garden's succulents and sapote tree beautifully complement the home's architecture.

A Great Central Piedmont Location

Simplify your life!  Set on a very private cul-de-sac tucked between Oakland Avenue and Piedmont Park, the home is a couple of blocks away from Wildwood Elementary's playground, its after-school child care site, and Piedmont's middle and high schools, and just a tad further to casual carpool (or the bus stop) bound for San Francisco's Financial District (the ride is about a half-hour, door to door).  Watch the kids ride bikes or play ball in the circle.

Careful Attention to the Systems--

Too many homes built with quality during the Roaring Twenties missed out on systems updates in intervening years.  16 Keefer Court, by contrast, has been carefully maintained over the past 30 years, including roof replacement, electrical update, seismic update, french door replacement, dry rot repairs, newer high-efficiency furnace, and some dual-pane window replacements. 

Open Sunday, 2-4:30 pm, and Monday 10-1 for broker's tour (public welcome).  Offered at $1.095 million.

Lots more photos and info at 

Monday, February 3, 2014

Ca. Assoc. of Realtors Thinks Big about Growth, Jobs, Incomes, and Housing

Intrigued to see such a thoughtful and progressive piece coming from the CAR--click here to read the executive summary. 

See particularly the graph at p. 7.

I've been wondering recently if prices in Piedmont (particularly in juxtaposition to Oakland) have been so strong because there are just more folks at the top end with very strong incomes, for whom this town makes sense as a personal investment.  Median incomes are stagnating or declining, in the main.  But high-end incomes are very strong, meaning more competition for high-end homes.......

Friday, January 31, 2014

Piedmont and Tsao and McKown Make National News!

Remodelista is my personal vice.  Check out this Piedmont home that captured the editor's imagination during their week of China emphasis.

Tuesday, January 21, 2014

Smart Homes, Part II

See this New York Times story from today covering the range of tech management and control in the home we're likely to be seeing--

Friday, January 17, 2014

Smart Homes in the Transition from Seller to New Owner

I'm increasingly seeing "smart" homes on the market--whether it's a home with a Nest thermostat (linked only to the former owner's email address), or a Sonos audio system, or a more comprehensive system that manages audio, video, security, irrigation, automated window shades, HVAC, wine cellar, and more.

How should a seller be clear about what is included in the sale?  How does a seller responsibly transfer these technologies to the buyer? How does a buyer ensure that they understand the technology before the seller moves to the next phase of life?  What do we all do if it doesn't work?

I've developed a few resources on this front--inspectors who can review the status of existing equipment, and a checklist to make sure technology doesn't put the transaction at risk.

Happy New Year!

I hope you've filled out and returned your Piedmont ballot, if you vote early (and have Feb. 4th's Election Day on your calendar, if you don't).  There's lots of change scheduled for Piedmont this year--various high-level retirements in the city's government, together with leadership turnover at the City Council and the School Board.  But so much of our small town's essence will remain exactly the same.  That's why we all moved here, and why Bay Area buyers continue to highly value our great schools, rapid emergency services, and ''it takes a village'' look and feel. 

Driving around town as I do, I've noticed a lot of home renovation and improvements going on (particularly in that unit block of Highland Avenue!).  We seem to have a bit more free cash, and our increasing home values certainly justify some added investment and preventive maintenance.

In fact, the average price of a Piedmont home increased from $1.457 million ($542/sf) in 2012 to $1.614 million ($620/sf) in 2013, a jump of 10.7%.  We're now a bit above the average home prices at the height of the pre-Great Recession (11/2005 was our ''old'' zenith, at about $600/sf).  If you've been postponing retirement and a sale, now may be your perfect moment!

Like last year, our total number of sales was modest, compared to the mid '00s--only 113 total sales in 2013 compared to about 140 per year back then.  Nevertheless, the velocity of our sales is very brisk.  Both last year and this year, the median days-on-market for a sale was 13 days--two weekends of open houses.  Sales prices averaged about 9.1% over the original asking price, and about a quarter of all sales closed at 20% or more above the asking price.  Prices ranged between $4.9 million at the high end, and $635,000 at the low end.

This quarter's activity was quite strong, and open house traffic this month--a proxy for serious buyers--appears very strong based on feedback at our staff meetings.  While only 20 home sales closed, the average price for those was $1.68 million (9.3% over the asking price), and $634/sf.  The average days on market lengthened a bit, most likely because of the holidays sprinkled through the quarter.  [3Q13 was softer, perhaps because interest rates drifted up in anticipation of the end of QE2:  the average sales price then was $1.486 million ($591/sf).] 

Turning to Oakland and Berkeley, both markets also saw about 6% fewer sales in 2013 compared to 2012.  But both markets saw remarkable rebounds in prices over 2012--the average Berkeley price rose 28% to $840,870 in 2013 from just 656,860 in 2012 (and final prices were 12% over the asking on average).  And correspondingly, the average Oakland price rose 34.5% to $491,400 in 2013 from $365,640 in 2012 (and final prices were 7.5% over asking). 

This is a far cry from the prices we saw when way too many sellers were distressed and forced to sell into a dysfunctional market, and the vast majority of sales prices were at a discount compared to the asking price.  Those markets were twisted out of shape to a much greater degree than was the Piedmont market, and they have reverted back into shape.

Imagine two sloped lines that cross in the middle, representing asking prices and sales prices.  We shift from a buyer's market to a seller's market as that at-first lower sales price line rises and then crosses the asking price line.

If we look only at Oakland homes that share the three zip codes with Piedmont, the picture is more attractive and stable: The total number of home sales actually increased a tad, and sales prices rose 15.5% between '12-'13, from $782,200 to $903,500 (8.2% over asking). 

I've been feeling like the mid-priced Piedmont home is selling at an even greater premium compared to a similar Oakland home, and the data support this.  Comparing only 3 bedroom/2 bath single-family homes in those Oakland zips to 3/2 homes in Piedmont, the Piedmont premium has risen to $500,000 (from about $250,000 about 8 years ago and $350,000 a couple of years ago).  This might be in reaction to Oakland's recent crime issues and continuing concerns about its public schools (though API scores of nearby schools, including Peralta in Temescal, continue to be very strong), but interest rates also appear to be a driver.

I have a factsheet I provide to my buyer clients that looks at this incremental house price paid for Piedmont (including its schools) compared to the cost of buying in Oakland and paying private school tuition (since that's the frame through which many buyers look that their choices).  The data are quite clear:  Buyers essentially leverage their static resources (savings and paycheck) with today's low interest rates, and bid the Piedmont house price up. 

We might expect this differential between Piedmont and Oakland prices to narrow--that is, the amount a Piedmont seller could bank when relocating to Oakland would drop--once interest rates start to rise. 
That's a good reason to consider selling now rather than in a high interest-rate environment--give me a call if you're considering a sale in 2014.  I'd love to compete for your business!

Planning a Makeover--Or Renovation?  Read This!

We normal people only remodel, or redecorate every decade--or two!  How would we know how do to it right, or to protect against cost overruns?  Measure twice, cut once.  But what else?  Browsing recently, I came across this nice list of things to consider when planning a serious re-decoration effort.  Years ago, a local contracting firm, Winan's Construction, developed a great roadmap to planning and managing your renovation project effectively.  Don't want cost overruns?  Don't change your mind (my point, not theirs....).  Read my copy of their package.

Don't forget, I'm happy to review your draft plans for thoughts and insights on re-sale angles--did so just this month for a remodeling buyer and for a local high-end renovation firm that used me to purchase their Piedmont fixer.  With one whole-house and one half-house renovation under my belt, it's easy.

Private Sale Anyone?  Not!

Those sales above summarize above comprise those reported by our local MLS; we are seeing a few more off-market sales these days, as ''private'' MLSs and some for-sale-by-seller situations seem to be the rage among unsophisticated sellers.  A story on the topic in the New York Times in the spring spent a lot of time interviewing a Manhattan seller who had done all the marketing, property prep work and (many) open houses himself.  He was very positive about the experience, yet he hadn't actually sold his home.  And when you're selling what is likely to be your largest asset, let's be clear:  Selling the house and getting the check is what it's all about. 

Most sellers want the highest price with best terms they can secure--for instance a typical term would be agreement that the sellers can stay in their home for a couple of months after close so they can find and close on a new home themselves.  The best way to accomplish this is by prepping the home until it shines, getting into the DNA of the home to make sure buyers understand the value there, and then showing it to as many serious buyers as possible.  It's basic economics:  Our supply of available homes is constrained now, and you want to maximize demand to generate the highest price.  Private sales violate all of these tenets. 

(And they also open brokerage firms to seller lawsuits.  In fact, the Ca. Assoc. of Realtors responded to the recent spike in ''oh, now I understand'' litigation on this point by adding several paragraphs to our listing contract to ensure that sellers are crystal-clear about the many downsides of private sales.) 
Sure, there are unique situations where a quiet and private sale will best meet a seller's preference for privacy or other priorities--essentially, the seller is willing to pay for privacy, and does so by accepting a lower-than-market price. 

Speaking of selling, this past year was a very good one for me.  I managed about $15 million in sales for my seller and buyer clients--about 80% of my work last year was for sellers, and about two-thirds of my work was in Piedmont.  My Piedmont buyers purchased at prices lower than the average premium over the asking price, and my sellers sold at prices substantially higher than the average premium over the asking price.  That track record reflects strong strategy and negotiation skills, and a calm, pragmatic and creative approach to dealing with colleagues in the local real estate community.   And remember, there are many!  Last year's 230 real estate ''sides'' in town involved 230 different buyers and sellers, dozens of different real estate firms, and probably 140 different real estate agents (some of whom are dabblers rather than active professionals).

We also sold our Pala Avenue home (we rented it for a while after we bought the Pacific Avenue home), and plowed that cash--minus the $500,000 we pocketed under the capital gains tax exclusion--into a couple of new investment properties.  The strategy took some time, involved renting the house, and required that we were willing to put those resources (beyond the $500k) into rental property rather than index funds, but resulted in deferring about $275,000 in capital gains taxes that would have otherwise been due.  Let me know if you want a factsheet on this strategy.

Worried about Water?

My spouse lived in Marin during the great drought of the '70s--he was telling the boys over their college break about a large temporary water pipe that took up one lane of Rt. 101 through Mill Valley back then.  On the East Coast, those news reports marked the first time I'd ever thought of a water shortage. 

These days, we're reminded of the lack of water every time we drive out to the Inverness house--the Nicasio Reservoir is so low that not only can you see the railing of the old road and bridge that were inundated--that bridge is now fully visible and about 100 yards from the current shoreline. 
Across the state, we're so water-wise these days that the water companies are feeling the pinch.  Water consumption is down due to all the low-flow toilets, washers, dishwashers, and shower heads we've installed, so water utilities have been having trouble covering their fixed costs.  But even all that work won't solve the problem if the drought continues.

See this factsheet for ideas on how to save money and water at your home, consider this discounted book to help you change out your water-hungry plants for plants appropriate for our Mediterranean climate, and consider installing a graywater system to divert laundry and/or shower water to your watering system.  Craig at the City says it requires a permit, and there are already two or three in town.  A drought regime can't order you to turn that off!  I'm scoping it out and will keep you updated.

Who Cares about the Change of Housing Characteristics Form?  You Maybe Should....

About three to four times a year, I put together estimates of value for recently widowed Piedmonters (no charge--why would I ever charge?).  Last month, we realized that the house in question was bigger than the tax record suggested.  The city and county knew the house had an original family room, fourth bedroom and third bath on the lower level, but didn't reflect any of that square footage in the tax record.

Why should you care?  Post-crisis (I can't believe I'm using that word about the American economy...), new appraisal rules say that appraisers can count the space reflected in a public record--usually the tax record.  So if your 4 BR/3 BA home is listed by the county as a 3/2, your appraiser is telling your buyer and buyer's lender it's worth a 3/2 price, not a 4/3 price. 

Some web-savvy buyers might not make offers because ''that seller's lying!  it's a 3/2 not a 4/3!''  (Remember, all buyers are web-savvy today.....'').  If there's an appraisal contingency, the buyer might use it to negotiate down the price. 

Some agents don't ''get'' this, or say ''not my problem.''  But it's easy to fix and I do it for my clients all the time. 

Check to see how the county describes your home.  If it looks right, you're done.  If space or bedrooms are missing, that's missing value!  Track down your permits or plans to demonstrate the space or bedrooms/baths are legal.  Find an old re-fi appraisal and grab the floorplan and square footage analysis that's in all appraisals. 

Write a succinct cover memo explaining the problem and your backup:  ''The tax record says x, but see the attached docs that confirm y, and the appraisal that says the correct square footage is z.''  Attach a filled-out Change of Housing Characteristics form at the assessor's website, and then call the office about a week after you mail the package to confirm they have what they need.  Eventually, they'll send you an updated characteristics document, and eventually Zillow and Trulia will start reporting the updated information.  And then, whenever you decide to sell, you'll get full value for your home!

If all this is just too much, give me a call and we can do it together.  If your added bath really is illegal?  Now that's a different question, but there are ways to work through that too---

Skirt Those Spare the Air Days

Speaking of drought repercussions, all those spare-the-air days lead us to be thankful that we installed gas fireplace inserts in our living and dining rooms shortly after we moved into the Pacific Avenue house.  They look ''real'' compared to those old gas stoves that didn't quite fit into fireplace openings, and even though I was a longtime Girl Scout and can start a fire multiple ways in under five minutes, I love the zapper. (Update:  today I came across a $600 off coupon good through 2/24 for a Regency fireplace--)

O'Kell's in San Francisco, Shamrock in San Rafael, and Berkeley Heat (they also sell hot tubs as Tubmakers) on Ashby all can help you out.

Maybe the Last Squib on Solar

All this sunshine means our solar panels are generating way more energy than expected.  I hear through a client that Solar City is beginning to offer an energy storage arrangement that offers a few days of electricity during a power outage or natural disaster, and can provide electricity adequate for basic needs indefinitely if you have solar panels installed. 

Solar City  also sparked breakfast table conversation yesterday after they announced that they will be offering financing opportunities to individual investors who want to support solar (they currently source their lease financing through major lenders).  Full disclosure:  We're happy with our Sungevity system.

Well, Maybe One More Solar Story:

Lawrence Berkeley Lab asks the question, but then ignores a key element!  See this story in a December Chron story for details--

According to LBL, solar generates about $6,000 in added value at sale per kilowatt of production capacity (most houses generate between 2 and 5 kW they say; we generate 2.6 kW).  Of course you might generate that capacity on the roof of a $400,000 home, or on the roof of a $4 million home.  But the analysis ignores the ongoing savings resulting from the installation itself--in our case a promised $115/mo in electric bill savings, which has turned out to be about $300/mo in practice [perhaps due to more drought/more sun this year compared to most].

My biz school background says you need to reflect the installation charge, capitalize the value of those monthly utility savings, and add them to the net present value of the incrementally higher sale price in the future.

It drives me nuts that so many analysts of, for instance, double-paned windows, look only at utility bill savings, but ignore incremental sales price premiums, while others look at the sales price premium and ignore the utility savings.  The former tend to be environmentalists and the latter tend to be contractors.

Start talking to each other guys!