Like my family, you all probably decided to move to Piedmont after looking at Berkeley, Montclair, Lafayette/Moraga/Orinda, and Mill Valley/Marin County. I hear it all the time with my new buyer clients: "I should let you know that we're also looking in ....." or better yet, "do you know a great agent who could help us take a look in .....?" (I have tried and true agent contacts in each of these areas.)
But the Piedmont pride nevertheless shines through. I while ago I pulled together a factsheet comparing 2000 census and API schools data on Piedmont and the Lamorinda towns, and over the years I've expanded it to discuss proximity to Chronicle 100 restaurants, and so on.
Over the break, I took a moment to check on updated info from the American Community Survey ('05-'09 data) and to take a detailed look at the Mill Valley vs. Piedmont choice--Konrad grew up in Mill Valley, went to Tam High, and still has lots of friends there, so particularly given the Inverness house, I probably spend four times as much time in Mill Valley as I do through the tunnel these days.
Let me know if you'd like either of the factsheets to pass on to friends and family. If you're looking for what we've got, it's a pretty clear choice!
Showing posts with label real estate. Show all posts
Showing posts with label real estate. Show all posts
Wednesday, December 22, 2010
Tuesday, August 31, 2010
Someone's Going to Get a Good Deal!
My corporate client is relocating back to Milan, and you might know someone interested in a spacious and open, low-maintenance townhome above the Claremont Hotel. Because it won't be staged and the garden wasn't planted this year, it's priced at an attractive $679,000!
This sunny and gracious 1995 Hiller Highlands end-unit townhome offers an effortless lifestyle high above the bustle of the East Bay and San Francisco. Relax in the living room with its fireplace, hardwood floors, open feel, canyon views and cathedral ceilings, or on the rear patio with its unusually large garden and spa. The elegant master retreat and large spa-like bath are just a half-flight above the main level. The home's three bedrooms and two and a half baths are spacious and sport the large closets you don't typically find in older East Bay homes. There's even more storage in the two-car garage (with workshop).
Just a bit above the Claremont shopping area, enjoy easy access to commute routes to Oakland, Berkeley, San Francisco or Contra Costa county. Enjoy a picnic and stay in shape at the nearby Hiller Highlands Country Club's pool, tennis courts, and gym room (at an affordable additional fee). Get energized by the spectacular Bay view as you descend the hill. Leave cutting the grass to the homeowner's association, yet enjoy gardening in the patio's planting bed!
1995 construction, and a very well-positioned homeowner's association. Note that photos are from the 2006 sale.
See 85Starview.com for all the details; open Labor Day Sunday and 9/12 from 2-4:30 pm.
Tuesday, August 3, 2010
33 Sotelo Coming to Market this Weekend!
Set among Mature Oaks and Surrounding a Sunny Courtyard….
See www.33SoteloAvenue.com for more photos.
If you appreciate cohesive mid-century design, pay attention to interior light, enjoy your privacy, require great indoor-outdoor flow for entertaining, and value one of the best locations in all of Piedmont, then don’t miss 33 Sotelo Avenue!
This beautifully updated, artfully situated and carefully maintained four-bedroom, four-bath level-in home faces some of the most impressive estates in the entire Bay Area; the rear courtyard, perfect for gathering, overlooks a gorgeous grove of trees and a peek-of-the-City view.
Located near the Hampton playing fields, tennis courts and pre-school, the home is just over a mile to Piedmont’s highly rated schools and to Montclair shopping.
With a light-filled and high-ceiling living room, dining room, family room, recently updated kitchen all opening onto the courtyard patio, the home is a rare mid-century gem, and a perfect setting for the coming years!
The site
33 Sotelo sits like the prow of a ship at the top of the prestigious Sotelo Avenue/Glen Alpine Road loop. Fanned out across the street are some of the most impressive estates in town. One of only a few properties that flow through from Sotelo to Glen Alpine, the long sightlines are remarkable: the San Francisco city lights, a distant redwood grove, oaks and bay laurels at the rear, and private entry drives at the front. Sitting on an outcropping of rock and surrounding an ancient live oak, the home is private yet close to recreation and shopping. The fenced rear yard is pet-ready and in a few months, those utility poles and wires will all disappear underground!
The home
33 Sotelo is one of a limited number of true mid-century homes in Piedmont with four full bedrooms and a lot big enough to accommodate a classic central courtyard.
The expansive living room (with newer gas fireplace that can be turned on with the push of a button) and adjacent west-facing courtyard are perfect for entertaining. Garden-style glass doors offer wonderful flow between the courtyard and the living, dining, family and master bedroom suite, and the several skylights bring in even more light. Each bedroom offers a bath en-suite or adjacent; the guest bedroom on the lower level provides an exterior entrance.
Much of the house has been updated in the last decade, including the creation of a gorgeous chef’s kitchen (with a GE Monogram six-burner gas range and two-drawer Fisher & Paykel dishwasher), and addition of a family room and breakfast area adjacent to the kitchen. The master suite feels like a high-end hotel room, with its clean lines, and sleek stone bath, complete with relaxing tub and spacious shower stall. Plantation shutters in many rooms manage light in keeping with the design’s integrity. See the Improvements List at 33SoteloAvenue.Com for more details.
The systems
33 Sotelo has been very carefully maintained; the owners rely on contractors with excellent reputations. Given electrical and plumbing upgrades, installation of two 50-gallon hot water heaters, fire-proofed cedar roof shakes, newer insulation in the crawlspace, a two-furnace heating arrangement, and triple pane windows (all permitted, of course), ownership should be worry free. The driveway was recently replaced, and service contracts on kitchen appliances run through 2011!
The community
Piedmont is one of the East Bay’s most sought-after communities. Offering wonderful views of the Bay and San Francisco beyond, San Francisco magazine declared the town the “best place for kids” in a 2005 article. Its school district offers excellent public schools (the high school is currently 64th in the nation according to US News and World Report), locally controlled emergency services and police based about a mile from the home, and short and convenient commutes to San Francisco, Oakland, Berkeley and destinations through the Caldecott Tunnel. Restaurants, movies and shopping in Rockridge, Piedmont Avenue, Monclair and the Elmwood are just a short distance away.
Amenities
-Sleek, classic mid-century design with level-in access on a nearly quarter- acre lot;
-Secluded location at the top of the prestigious Glen Alpine-Sotelo loop;
-Close to neighborhood park, tennis courts, ball fields and pre-school;
-About a mile to downtown Piedmont’s services and schools;
-Four bedrooms, four baths (guest suite with exterior access on the lower level);
-3252 square feet, 9030 square foot lot (per public records);
-Interior access to two-car garage with storage;
-Expansive living room, adjacent dining room and large courtyard;
-Recently updated chef’s kitchen with wonderful stone counters and stainless steel appliances;
-Family room, breakfast nook and full pantry adjacent to kitchen;
-Second slate patio for added privacy;
-Many recent updates and systems improvements! (see Improvements List under Documents).
Click here for a Google mashup of this prime location! Zoom in to see the boomerang shape of the home as it wraps around the central courtyard.
Saturday, February 13, 2010
Where's My Stuff?
Well, after you've been broken into is not the time to ask.
Check out Know Your Stuff from the Insurance Institute. Yes it will take a while to fill out, but if the worst occurs, you'll be all set to file a claim and move on with your life.
Allstate has an iPhone app along the same lines here; I recently saw an ad for an app specifically for auto accidents--photograph the damage, fill in the form, and you're off!
Check out Know Your Stuff from the Insurance Institute. Yes it will take a while to fill out, but if the worst occurs, you'll be all set to file a claim and move on with your life.
Allstate has an iPhone app along the same lines here; I recently saw an ad for an app specifically for auto accidents--photograph the damage, fill in the form, and you're off!
Data--You want Data?
Lots of real estate agents are great at talk, but less great at data (a balance of the two is generally optimal!).
Know that as you begin to organize for a purchase or sale, I'll be forwarding research to you from time to time: Everything from Wells Fargo's synthetic housing market report (email me for a copy) to Clarus Market Metrics reports on trends in your area of interest--by zip, city, size or type of home, etc. (ditto for a copy).
I get this material because of my relationships in the financial and housing policy fields (see more about my background here), and I read this stuff regularly to keep my finger on the pulse of the local market. All that in addition to visiting properties during Monday and Thursday brokers' tours, and touching base with realtors with pending listings--those often are the most up to date indicator of changing demand or pricing.
In fact, know that recent sales of attractive properties (meaning good location, good mix of amenities, not too many steps or too many floors, not too dramatic in style) are very often selling with multiple offers (and therefore often over the asking price).
It's all about getting you the big picture, so you are comfortable and confident as you make your offer!
Know that as you begin to organize for a purchase or sale, I'll be forwarding research to you from time to time: Everything from Wells Fargo's synthetic housing market report (email me for a copy) to Clarus Market Metrics reports on trends in your area of interest--by zip, city, size or type of home, etc. (ditto for a copy).
I get this material because of my relationships in the financial and housing policy fields (see more about my background here), and I read this stuff regularly to keep my finger on the pulse of the local market. All that in addition to visiting properties during Monday and Thursday brokers' tours, and touching base with realtors with pending listings--those often are the most up to date indicator of changing demand or pricing.
In fact, know that recent sales of attractive properties (meaning good location, good mix of amenities, not too many steps or too many floors, not too dramatic in style) are very often selling with multiple offers (and therefore often over the asking price).
It's all about getting you the big picture, so you are comfortable and confident as you make your offer!
Wednesday, January 6, 2010
Finally, 2009 is OVER!
Home prices in Piedmont dropped an average seven percent year-over-year between 2008 and 2009, and a bit less than 12 percent on a price-per-square-foot basis, according to data from the MLS (click on the image above to see a more readable version). The typical home sold in 44 days (compared to 26 days on market across 2008). Seventy-six homes sold during the year, roughly half the figure from several years ago, but essentially the same as last year's 77 sales. Final prices were about four percent less than asking prices, across the board, and ranged from $710,000 to $4 million.
The market was quite active all across the price spectrum. Seven homes sold for $2.5 million or more during the year. Only four of the total were identified as distressed--either bank-owned or short sales. Agents brought homes to market 57 times last year but failed to garner a committed buyer, however. That's a lot of Sunday open houses with no paycheck to show for it! This figure compares with 36 expired or withdrawn listings in 2008 (and only 17 in high-flying 2005).In a number of these cases, undoubtedly, sellers couldn't reduce their prices to market-clearing levels and pay off their outstanding mortgage and closing costs. We're also seeing some situations in which a home is pulled from the market, and a few months later a private sale takes place.
In the fourth quarter of 2009, prices actually increased a bit over fall of last year: 19 sales averaging $1.216 million sold in an average 39 days, compared to 17 sales averaging $1.147 million, typically sold in 18 days in 4Q08 (an increase of six percent, though that's not particularly meaningful with such a small number of sales in each of these quarters).
Surrounding areas fared similarly: 307 single family homes closed in Oakland 94611 and 94610 (roughly Montclair and Crocker Highlands) at an average price of $773,430 in 43 days, with 11 homes selling for more than $1.5 million. Last year, prices of the 340 single family homes averaged about $841,000, about eight percent more. A much larger percentage of these sales were distressed, however.
If we open up to all of Oakland, however, the story is more consistent with the headlines during the crisis: There were just over 3700 sales of all housing types in Oakland in 2009, averaging $297,600, with a median price of only $195,000 (I generally check to see if median prices are dramatically different from the averages, which more people intuitively understand, and they are typically relatively close. But not in Oakland last year!). This means that half of the sales were below $195,000 and half above. I scrolled through all 1000 sales between $200,000 and $400,000, and the vast majority were distressed, and the vast majority of those were bank-owned. In contrast, about 2600 Oakland homes sold in 2008, with an average price of $434,400 (and a median of $324,000). The MLS didn't have a notation for distressed sales until the middle of 2008, but even so, I had to scroll through the first 2/5s of all sales before they weren't very consistently identified as REO.
In Berkeley, 444 single family homes sold across the city in 2008 for an average $803,300, while roughly the same number, 424, sold this year for an average of only $716,000, all in roughly a month on average. This represents about a 10 percent price drop. About half of the lower-priced properties that sold through the MLS in Berkeley were bank-owned.
Across the state, the California Association of Realtors reports that the median price of a home was up nearly six percent in November, compared to a year earlier, that prices have increased in each of the last nine months, after reaching its lowest point in February 2009. Note that in all these markets, the "peak to trough" drops--that is the drop from the highest month a couple of years ago to the lowest month toward the beginning of this year was much larger than these year-over-year figures suggest. For instance, across California, prices dropped 57% peak to trough, and have climbed up 24% since then, largely due to the dramatic changes in the makeup of what's actually selling in the market. We've talked in the past about the massive influx of lower-priced homes that hit the market last fall and winter. Housing affordability (meaning the relationship between the median income and the median home price) has meanwhile improved dramatically across the state and county in the last year.
As I sit at the computer running through these transactions, I can feel the waves of foreclosures, and hear the tough conversations around dinner tables about whether to pay the mortgage this month, or to save the money to cover the possibility of a lost job or a slow period of consulting. And I can feel the pits in the stomachs, the free floating anxiety, about where this is all heading. I'm sure for many under financial stress, it feels like an impending train wreck, though unfortunately in slow motion. For those of us with plenty of equity and peace of mind, let's give thanks. And for those still uncertain about what the future holds, let's cross our fingers and vow to be generous and understanding. This last quarter has been much more stable and active than earlier in the year. While the bargains may no longer abound, the risks are likely lower as well. A good time to buy or sell--
If you'd like more data--a full powerpoint presentation of economic and housing market stats from the CAR; or a copy of the two-year market analysis from Clarus MarketMetrics for Piedmont or another sub-market, just email me at Kennedy@MaureenKennedy.Net.
Selling a Long-Held Home (with Lots of Capital Gains)
Former school board president, Boy Scout council president, and tax lawyer Dewey Watson and I put together a little brochure on this issue a couple of years ago--if you're lucky enough to have a million dollars or more in appreciation on your long-held home, how might you defer paying the capital gains taxes on the home?
This story, from colleague James Callejas at Fidelity Title's qualified intermediary, IPX, does a really nice job of laying out the tax-saving strategy.
Contact him, me, Dewey, or your tax advisor for more information--
This story, from colleague James Callejas at Fidelity Title's qualified intermediary, IPX, does a really nice job of laying out the tax-saving strategy.
Contact him, me, Dewey, or your tax advisor for more information--
Wednesday, October 7, 2009
What's that Color?
READ THIS POST BEFORE YOU CLICK ON THAT LINK!! Check out this site--and turn down your audio! Totally cool site that will match a photo you take to Benjamin Moore paint colors (which in turn can be matched at your non-Benjamin Moore paint vendor).
Saturday, October 3, 2009
Whether You're Borrowing or Lending--IntraFamily Strategies
A nice piece in today's Journal about tax-savvy strategies to borrow funds from Mom and Dad, or lend funds to the children--perhaps for a home purchase?
Read it here.
Read it here.
Monday, September 28, 2009
Elements of the Principal-Agent Relationship
I’m on the advisory board of the Institute for Luxury Home Marketing, which in turn has a relationship with the Luxury Institute, which gives me access to the LI’s Wealth Report 9 times a year.
An article in this month’s issue was a great reminder. The managing director of the Bessemer Trust discussed five elements of a great principal-agent relationship:
1. Put the clients’ interests first.
2. Understand the clients’ total situation.
3. Be honest and transparent.
4. Deliver truly proactive client service.
5. Maintain absolute confidentiality.
A great list I aspire to!
An article in this month’s issue was a great reminder. The managing director of the Bessemer Trust discussed five elements of a great principal-agent relationship:
1. Put the clients’ interests first.
2. Understand the clients’ total situation.
3. Be honest and transparent.
4. Deliver truly proactive client service.
5. Maintain absolute confidentiality.
A great list I aspire to!
Thursday, August 27, 2009
It's Back to School!
And I've been working furiously this week to get prepared! This week I've been shifting to newer, cooler business tools.
I'm trying to complete my shift from aol (home since 1993--that's a long time....) to gmail. Shifted my blog locus from Active Rain (the original blog platform for real estate) to Blogger. Staying with CoolerEmail for my e-newsletter. So here's the summary:
My best email remains Kennedy@MaureenKennedy.Net. MaureenKennedy@aol.com will continue to work for a long time (and no need to send to both, folks--both flow through to my Blackberry immediately).
Check out my new gorgeous Piedmont blog format at http://piedmonthouseandhome.blogspot.com/ or, to keep it simple, http://tinyurl.com/PiedmontHome.
All past e-newsletter articles continue to reside at my blog (and I've been up til 2 am these last few nights cutting and pasting everything to the new site). So if you know someone who's interested in moving to town, tell them to check out the archive or subscribe!
I now have four Google websites you or your friends and colleagues may find useful--just email me and I'll give you the links. They collect resources I've delivered to clients in various less ecofriendly ways over the years. They include:
Piedmont Information (links, photos, documents,school info, factsheets, resources for buyers)
Marketing Samples for Piedmont Sellers (case studies, ideas, background and resources for sellers)
Renovation Resources (energy and water efficiency incentives and rebates, eco-tips, Cost vs. Value reports, vendor lists, build-it-green ideas,links)
Distressed Sales in Piedmont (Q&As on taxation, legal liability, and so on for owners struggling to meet their payments)
Separately, I regularly offer buyers:
An email list of Sunday open houses delivered to their desktop every Saturday morning; automatic e-notifications every time a property meeting their parameters hits the market; a review of typical buyer costs for homes at various price points; a memo outlining strategies buyers can use to increase the chances their offer will be accepted; a table identifying East Bay public schools with high API scores, with click-thrus to sites with more information about those neighborhoods; a list of four deeply experienced lenders to call for financing ideas and insight; and a package of buyer factsheets from the National Association of Realtors.
My website (still www.MaureenKennedy.Net) allows buyers and sellers to organize e-notifications of new listings on their own, and includes a form to request an analysis of the current value of your home.
Bottom line: Jazzier presence, clearly organized information, and a seamless transition.
And don't forget that I'm never too busy for your referrals!
I'm trying to complete my shift from aol (home since 1993--that's a long time....) to gmail. Shifted my blog locus from Active Rain (the original blog platform for real estate) to Blogger. Staying with CoolerEmail for my e-newsletter. So here's the summary:
My best email remains Kennedy@MaureenKennedy.Net. MaureenKennedy@aol.com will continue to work for a long time (and no need to send to both, folks--both flow through to my Blackberry immediately).
Check out my new gorgeous Piedmont blog format at http://piedmonthouseandhome.blogspot.com/ or, to keep it simple, http://tinyurl.com/PiedmontHome.
All past e-newsletter articles continue to reside at my blog (and I've been up til 2 am these last few nights cutting and pasting everything to the new site). So if you know someone who's interested in moving to town, tell them to check out the archive or subscribe!
I now have four Google websites you or your friends and colleagues may find useful--just email me and I'll give you the links. They collect resources I've delivered to clients in various less ecofriendly ways over the years. They include:
Piedmont Information (links, photos, documents,school info, factsheets, resources for buyers)
Marketing Samples for Piedmont Sellers (case studies, ideas, background and resources for sellers)
Renovation Resources (energy and water efficiency incentives and rebates, eco-tips, Cost vs. Value reports, vendor lists, build-it-green ideas,links)
Distressed Sales in Piedmont (Q&As on taxation, legal liability, and so on for owners struggling to meet their payments)
Separately, I regularly offer buyers:
An email list of Sunday open houses delivered to their desktop every Saturday morning; automatic e-notifications every time a property meeting their parameters hits the market; a review of typical buyer costs for homes at various price points; a memo outlining strategies buyers can use to increase the chances their offer will be accepted; a table identifying East Bay public schools with high API scores, with click-thrus to sites with more information about those neighborhoods; a list of four deeply experienced lenders to call for financing ideas and insight; and a package of buyer factsheets from the National Association of Realtors.
My website (still www.MaureenKennedy.Net) allows buyers and sellers to organize e-notifications of new listings on their own, and includes a form to request an analysis of the current value of your home.
Bottom line: Jazzier presence, clearly organized information, and a seamless transition.
And don't forget that I'm never too busy for your referrals!
All You Need to Know about Shower Heads
Just today, the New York Times Home section included this story comparing several shower heads. The author was looking for that WaterPik feel from our teenagerdom-----
The Buy vs. Rent Choice
Recently, a client I'd been working with for quite a while mentioned that he was thinking that he'd stay here in the Bay Area for 2-3 years, and then move away. Always paying attention to serve my clients' best interests, I said, "hey; we should rethink this home purchase gameplan, then."
We talked about what is known (and NOT known) about market trends for the next couple of years, for his locations and for his price point, because these can be very different than for other locations and price points. We talked about transaction costs--he had already seen my buyer's costs spreadsheet each time we've made an offer, unique for his city and purchase price, estimating escrow fees, city transaction fees, inspection fees, and homeowner insurance fees, among others.
But he wasn't thinking about these as transaction costs to be recouped, and definitely wasn't thinking about what the "seller net proceeds" sheet would look like when he went to sell--the brokerage fee, staging fees, and recordation costs. That is, between the 2% of costs to buy and 6.25% of costs to sell, excluding loan fees, and any surprise repairs and staging, he needs about 10% appreciation in the coming three years to make buying pan out.
While he hasn't yet made a final decision, I suggested that he take a look at two sites:
http://realestate.yahoo.com/calculators/rent_vs_own.html includes an NPV analysis, allows you to enter inflation and discount rates, clearly reflects interest rate deductibility, and allows you to do the math over a range of periods ("what if we move in x years? y years?"). But doesn't seem to reflect transaction costs--the not-insignificant costs of actually buying, and then selling, the house.
The New York Times has a nice tool which DOES allow you to including these figures if you go to the "advanced" menu (and who wouldn't, given that the basic menu leaves so much of the analysis out??). See http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html#
I can't tell if the New York Times site reflects the deductibility of your mortgage payments--it references "owner fee" deductibility, just under the HOA fee field, leading to confusion. While there are many who would argue that one shouldn't make choices based on tax effects ("I'll buy lunch for everyone because I can claim it as a business expense!" Not!) there's no doubt that the net cash flows change depending on your tax bracket and so on.
So if you're on the fence about buying vs. renting, take a look at these buy vs. rent calculators!
We talked about what is known (and NOT known) about market trends for the next couple of years, for his locations and for his price point, because these can be very different than for other locations and price points. We talked about transaction costs--he had already seen my buyer's costs spreadsheet each time we've made an offer, unique for his city and purchase price, estimating escrow fees, city transaction fees, inspection fees, and homeowner insurance fees, among others.
But he wasn't thinking about these as transaction costs to be recouped, and definitely wasn't thinking about what the "seller net proceeds" sheet would look like when he went to sell--the brokerage fee, staging fees, and recordation costs. That is, between the 2% of costs to buy and 6.25% of costs to sell, excluding loan fees, and any surprise repairs and staging, he needs about 10% appreciation in the coming three years to make buying pan out.
While he hasn't yet made a final decision, I suggested that he take a look at two sites:
http://realestate.yahoo.com/calculators/rent_vs_own.html includes an NPV analysis, allows you to enter inflation and discount rates, clearly reflects interest rate deductibility, and allows you to do the math over a range of periods ("what if we move in x years? y years?"). But doesn't seem to reflect transaction costs--the not-insignificant costs of actually buying, and then selling, the house.
The New York Times has a nice tool which DOES allow you to including these figures if you go to the "advanced" menu (and who wouldn't, given that the basic menu leaves so much of the analysis out??). See http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html#
I can't tell if the New York Times site reflects the deductibility of your mortgage payments--it references "owner fee" deductibility, just under the HOA fee field, leading to confusion. While there are many who would argue that one shouldn't make choices based on tax effects ("I'll buy lunch for everyone because I can claim it as a business expense!" Not!) there's no doubt that the net cash flows change depending on your tax bracket and so on.
So if you're on the fence about buying vs. renting, take a look at these buy vs. rent calculators!
Home Price Declines Moderating--NYT--It Must Be True!
Click here for the cool graphic I've been including in the last few updates of home price trends in 20 metro areas, based on the Case-Shiller Index. Those curves are pretty consistently trending up--roughly what I'm seeing on the ground in this market. And these figures are through the end of April. They buttress a piece on price trends in yesterday's New York Times.
Market Downturn Hits Piedmont Market
2Q09 Market Update
After several years of steady prices (sales prices had been quite flat at around $600/sf since our market peak in November of 2005), and a winter and spring of very few sales and prices all over the place, this spring market makes the market direction clear: Prices are down as much as 16-18 percent compared to a year ago (see detailed spreadsheet at the bottom of the page).
I think our market has been affected by several factors unique to our high-end market. First, market distress has been focused below our price range, but those sellers are our move-up buyers. If they are having trouble selling, they have trouble turning around and buying. This pattern applies to less-expensive homes in Piedmont as well--their owners were very frequently the buyers of more-expensive homes in town.
Second, Piedmont buyers are often in law, finance, and corporate management, and each of these sectors is under great stress in today's economy. If high-income colleagues are being laid off, is now the time to commit to a Piedmont home and a hefty mortgage?
And third, Piedmont homes typically involve large mortgages, which are much more difficult to secure these days. Even if a buyer had a 50% downpayment for a $2 million home, securing that million dollar mortgage is not a piece of cake (but definitely can be done!).
There are plenty of reasons to buy in Piedmont, however, and these are arguments I lay out every time I market or hold open a Piedmont home:
--Props B+E passed, securing funding for our great schools and insulating them to a large degree from the state's budget woes;
--our free public schools offer great alternatives to private schools and their perennial inflation increases;
--our 911 services are exclusive and just a few blocks away, so no need to worry how long an ambulance will take to respond to a heart attack;
--our ''it takes a village'' lifestyle is very comforting to many; and
--our Census-tracked demographic mix (everything from typical commute times, to proportion of working moms, to ethnic and racial diversity) is more attractive to many households than similarly high-end communities through the tunnel, for instance.
Clearly, these arguments have traction. Our home prices have fared well by comparison (meaning in part, that if you purchased last summer, your investment here did better than your old home elsewhere would have). Average prices for homes in Alamo and Blackhawk sit at $376/sf for 2Q09 (a 34% decline from 2Q06), compared to $509/sf for all of Piedmont's market this past quarter. And the number of successful sales is down 55% in those towns, compared to our sales, which are down only 25% compared to 2Q06.
Looking only at Piedmont, the average home price was $1.401 million this past quarter, compared to $1.714 million for 2Q08 (based on data from the MLS). On a per square foot basis, the average, as noted, is $509/sf for 2Q09, compared to $605/sf in 2Q08. Homes are selling in an average 38 days, and a few more homes sold this last quarter, compared to the second quarter of last year.
Not too bad when placed in national context (see next post) and in light of the highest unemployment rate in a generation. Looking regionally, prices in Oakland were up 14.1% in May compared to April (but down 63.6% compared to May '08 [we saw a sneak preview of May data recently at the Oakland Assoc. of Realtors]); those in Alameda County more broadly were up 6.1% in April over March (but down 25.1% compared to April '08); and those in San Francisco were up 7.7% in April over March (but again down 23.2% compared to April '08).
Overall homeowner affordability is up dramatically in California compared to the recent past--moving from a point where only 25% of homes were affordable to someone with a median income in the state, to very near the national average of 70% affordability.
For information about reassessments and property tax reductions, read on-----
After several years of steady prices (sales prices had been quite flat at around $600/sf since our market peak in November of 2005), and a winter and spring of very few sales and prices all over the place, this spring market makes the market direction clear: Prices are down as much as 16-18 percent compared to a year ago (see detailed spreadsheet at the bottom of the page).
I think our market has been affected by several factors unique to our high-end market. First, market distress has been focused below our price range, but those sellers are our move-up buyers. If they are having trouble selling, they have trouble turning around and buying. This pattern applies to less-expensive homes in Piedmont as well--their owners were very frequently the buyers of more-expensive homes in town.
Second, Piedmont buyers are often in law, finance, and corporate management, and each of these sectors is under great stress in today's economy. If high-income colleagues are being laid off, is now the time to commit to a Piedmont home and a hefty mortgage?
And third, Piedmont homes typically involve large mortgages, which are much more difficult to secure these days. Even if a buyer had a 50% downpayment for a $2 million home, securing that million dollar mortgage is not a piece of cake (but definitely can be done!).
There are plenty of reasons to buy in Piedmont, however, and these are arguments I lay out every time I market or hold open a Piedmont home:
--Props B+E passed, securing funding for our great schools and insulating them to a large degree from the state's budget woes;
--our free public schools offer great alternatives to private schools and their perennial inflation increases;
--our 911 services are exclusive and just a few blocks away, so no need to worry how long an ambulance will take to respond to a heart attack;
--our ''it takes a village'' lifestyle is very comforting to many; and
--our Census-tracked demographic mix (everything from typical commute times, to proportion of working moms, to ethnic and racial diversity) is more attractive to many households than similarly high-end communities through the tunnel, for instance.
Clearly, these arguments have traction. Our home prices have fared well by comparison (meaning in part, that if you purchased last summer, your investment here did better than your old home elsewhere would have). Average prices for homes in Alamo and Blackhawk sit at $376/sf for 2Q09 (a 34% decline from 2Q06), compared to $509/sf for all of Piedmont's market this past quarter. And the number of successful sales is down 55% in those towns, compared to our sales, which are down only 25% compared to 2Q06.
Looking only at Piedmont, the average home price was $1.401 million this past quarter, compared to $1.714 million for 2Q08 (based on data from the MLS). On a per square foot basis, the average, as noted, is $509/sf for 2Q09, compared to $605/sf in 2Q08. Homes are selling in an average 38 days, and a few more homes sold this last quarter, compared to the second quarter of last year.
Not too bad when placed in national context (see next post) and in light of the highest unemployment rate in a generation. Looking regionally, prices in Oakland were up 14.1% in May compared to April (but down 63.6% compared to May '08 [we saw a sneak preview of May data recently at the Oakland Assoc. of Realtors]); those in Alameda County more broadly were up 6.1% in April over March (but down 25.1% compared to April '08); and those in San Francisco were up 7.7% in April over March (but again down 23.2% compared to April '08).
Overall homeowner affordability is up dramatically in California compared to the recent past--moving from a point where only 25% of homes were affordable to someone with a median income in the state, to very near the national average of 70% affordability.
For information about reassessments and property tax reductions, read on-----
Some MLS Insights
No brokerage represented more sides in the Piedmont market last quarter than Pacific Union. When representing sellers, we offered accurate pricing advice and strong negotiating skills--our sellers garnered sales prices very close to their original asking prices, and sold in about half the time compared to the competition. That's what you pay your brokerage firm for.
Houses that stayed on the market for more than three months sold for an average 20% off the asking price. If you have all the time in the world, go to the competition. If you want to sell your house, come to me and the Pacific Union team!
Houses that stayed on the market for more than three months sold for an average 20% off the asking price. If you have all the time in the world, go to the competition. If you want to sell your house, come to me and the Pacific Union team!
Piedmont Update, and About those Appraisals-----
Ten homes sold in the first three months of 2009 in Piedmont in an average 65 days, compared to 16 last quarter and 11 in the first quarter of 2008 (see details at the page bottom). The average price of a home was $1.867 million ($570/sf), a dramatic rise from last quarter's figure of just over a million. In contrast to then, nearly half of this quarter's homes sold for over $2 million. Two of the sales were REO or bank-owned properties, and most of the high-end homes had been on the market for several months.
Let's get real, though--it's folly to base conclusions on so few sales in such a small town. These homes included some that offered much more square footage than the tax record reflected, one whose buyers paid nearly $100,000 of the sellers' costs (I've adjusted that effective sales price in the attached spreadsheet), and several with fabulous grounds or major structural issues. What does average mean in that context?
Of more interest to me have been new developments on the appraisal front. A number of you have received notes from your home equity line lender reducing, freezing or even eliminating your line of credit. Our neighbors in the surrounding communities have been seeing these notes for the last several months.
In some cases, lenders are trying to get out of this market. In others, lenders happily go back to thestatus quo ante when you push back a bit with thoughtful comparables from your deeply experienced local realtor. In others, your current lender, or perhaps a new lender you choose, wants an appraisal before they'll up your limit again (and if you're right and the value is there, ask in advance that the lender pay for the appraisal).
On the appraisal front, beginning around April 1st, new rules went into effect strengthening the arms-length relationship among lenders, mortgage brokers, and appraisers. Among the myriad effects and implications is that appraisals for Piedmont homes are increasingly done by out-of-area appraisers.
I saw an appraisal last week that included a Piedmont-Side-of-Montclair (i.e. Oakland) home among the comps. A deeply experienced local appraiser says that with so few homes closing in Piedmont, and with lenders understandably super-sensitive about value, they are willing to trade off ''true'' comparability for recency. Thus, a '20s stucco home with lots of traditional detail in a great central location was compared exclusively with recently closed homes that all happened to be ranch style, and most were located up in the Montclair-Side-of-Piedmont area (i.e. Piedmont). One recently closed home in a great location across from a park in town did not ''appraise'' for its contract price, even though the highest of the three offers garnered with just one open house was (drumroll please....) at asking price.
Maybe the differentials among prices for older homes vs. newer homes, and homes on wide streets vs. homes on narrow windy streets, and homes with Bay views vs. homes without Bay views, and homes with easy walks to all schools vs. homes that require a carpool are just over the top. Maybe it is more about square footage. But these factors have formed the warp and weft of the Piedmont real estate market for generations. We may be at a flexion point in property valuation and things may go back to a new normal shortly, but for those purchasing now, refinancing to today's great rates, or trying to protect a home equity line, the situation is clearly driving many crazy.
I'll never forget talking to the mother of a parent at our child care center in Washington DC a dozen years ago. She'd grown up in Piedmont and raised here children here. We mentioned where we lived and she said, ''ah, that's a good street'' and went on to clarify why she thought that was the case, with remarkable specificity. She was thinking back to 1979.
One final note--our MLS has signed on for detailed market analysis from Clarus Market Metrics--email me if you'd like the Piedmont-wide trend graphics over the past two years and I'll send you the multi-page pdf document. If you get ready to buy or sell, we'll narrow down the analysis to your portion of the market to help in pricing or development of the offer.
Let's get real, though--it's folly to base conclusions on so few sales in such a small town. These homes included some that offered much more square footage than the tax record reflected, one whose buyers paid nearly $100,000 of the sellers' costs (I've adjusted that effective sales price in the attached spreadsheet), and several with fabulous grounds or major structural issues. What does average mean in that context?
Of more interest to me have been new developments on the appraisal front. A number of you have received notes from your home equity line lender reducing, freezing or even eliminating your line of credit. Our neighbors in the surrounding communities have been seeing these notes for the last several months.
In some cases, lenders are trying to get out of this market. In others, lenders happily go back to thestatus quo ante when you push back a bit with thoughtful comparables from your deeply experienced local realtor. In others, your current lender, or perhaps a new lender you choose, wants an appraisal before they'll up your limit again (and if you're right and the value is there, ask in advance that the lender pay for the appraisal).
On the appraisal front, beginning around April 1st, new rules went into effect strengthening the arms-length relationship among lenders, mortgage brokers, and appraisers. Among the myriad effects and implications is that appraisals for Piedmont homes are increasingly done by out-of-area appraisers.
I saw an appraisal last week that included a Piedmont-Side-of-Montclair (i.e. Oakland) home among the comps. A deeply experienced local appraiser says that with so few homes closing in Piedmont, and with lenders understandably super-sensitive about value, they are willing to trade off ''true'' comparability for recency. Thus, a '20s stucco home with lots of traditional detail in a great central location was compared exclusively with recently closed homes that all happened to be ranch style, and most were located up in the Montclair-Side-of-Piedmont area (i.e. Piedmont). One recently closed home in a great location across from a park in town did not ''appraise'' for its contract price, even though the highest of the three offers garnered with just one open house was (drumroll please....) at asking price.
Maybe the differentials among prices for older homes vs. newer homes, and homes on wide streets vs. homes on narrow windy streets, and homes with Bay views vs. homes without Bay views, and homes with easy walks to all schools vs. homes that require a carpool are just over the top. Maybe it is more about square footage. But these factors have formed the warp and weft of the Piedmont real estate market for generations. We may be at a flexion point in property valuation and things may go back to a new normal shortly, but for those purchasing now, refinancing to today's great rates, or trying to protect a home equity line, the situation is clearly driving many crazy.
I'll never forget talking to the mother of a parent at our child care center in Washington DC a dozen years ago. She'd grown up in Piedmont and raised here children here. We mentioned where we lived and she said, ''ah, that's a good street'' and went on to clarify why she thought that was the case, with remarkable specificity. She was thinking back to 1979.
One final note--our MLS has signed on for detailed market analysis from Clarus Market Metrics--email me if you'd like the Piedmont-wide trend graphics over the past two years and I'll send you the multi-page pdf document. If you get ready to buy or sell, we'll narrow down the analysis to your portion of the market to help in pricing or development of the offer.
While the NYT is Figuring out Its New Business Model--
Their web geeks developed this cool, if thought-provoking and intimidating, graphic to convey the trends in 20 metropolitan housing markets. Take a look and click through the cities.
Interim Piedmont Update
Let me start out by saying that it's VERY hard to draw hard conclusions from the nine transactions that have closed since the first of October.
Some good news--No major banks have failed in the last few weeks. Several of the largest lenders have recently implemented foreclosure moratoria (maybe not good news for someone hoping to pick one up next month). Open houses are seeing more visitors these last two weeks. The number of homes going into contract in the East Bay Hills has increased over the last several weeks. Four homes are pending in Piedmont; three went into contract within 19 days on market and two of these are scheduled to close after just two or three weeks in escrow. Zoom zoom zoom. I heard NPR do a story this a.m. wondering if the market is turning. Moreover, we're now seeing loans in the over-$729,500 realm for well-qualified buyers purchasing homes with sizeable downpayments--not the case for the last couple of months!
The numbers say that:
1. Nine homes have sold since 10/1, compared to 16 in the same window in '07, 11 in '06, and 21 in '05. Nothing new there--we knew that the number of sales was down nearly 50% from last year---
2. Those homes that sold, sold quickly--in an average 17 days on market. Buyers are very focused and quick to act when they see value, and sellers aren't taking chances or waiting around. The average price per square foot was about $500, but these were mostly less-expensive fixers--one larger, beautifully located and cared-for home sold for a bit over $700/sf, and for over $2 million. I'm not comfortable suggesting a decline in average prices beyond the 5% or so drop from our late 2005 peak that cropped up in last quarter's numbers.
3. The 25 homes actively seeking buyers have typically been on the market for 54 days and many have seen price cuts. Their current average price is $588/sf (still a tad above last quarter's average for sold homes), but four are hoping for upwards of $800/sf or more. Five are distressed--already owned by banks, or the owner is likely to be short of funds to close, meaning the lender(s) must agree to ''eat'' a portion of the outstanding balance [realtors are required to disclose this fact in the MLS now]. Seven homes have come off the market since 10/1. This is a noticeable increase, and suggests frustrated sellers and/or those who don't have many degrees of freedom for price cuts.
4. While seven out of the nine homes sold recently cost less than $1.5 million; half of the active homes started out at over $1.5 million. Maybe buyers feel more confident in these uncertain times with less expensive purchases or maybe the shortage of financing and anticipated bonuses is taking its toll at the high end.
So, the bottom line is that our market is in much better shape than surrounding areas (85% of newly pending transactions under $500,000 in the ''inner'' East Bay last week were distressed), and serious sellers are still finding serious buyers for their homes along the price spectrum. As households move to reduce discretionary expenses, I imagine we'll see more demand for the great schools that go along with a Piedmont purchase (if you have friends or colleagues thinking about a private school to public school move, ask me for the link and password to my Piedmont Information site. Among many photos, links and factoids, it's got links to all the key PUSD backgrounders as well as a net present value analysis of a Piedmont purchase (with Piedmont schools) vs. an Oakland purchase just outside our borders (and private schools). And of course I'd love to assist anyone you know as they plan an East Bay purchase or sale).
When's a Jumbo Loan a Jumbo Loan?
Don't forget that starting Jan. 1st, loans in our metro area over $625,500 will be considered ''jumbo'' as to rates and terms--the federal agencies will reduce the maximum loan size they are willing to purchase from area lenders by about $100,000 from that emergency/temporary figure of $729,750 established back in July. Organize any refis or new purchases that will need a loan in that $625-$729K range before 12/7 or 12/15 at the latest to make sure the loan closes before the jumbo definition changes!
Some good news--No major banks have failed in the last few weeks. Several of the largest lenders have recently implemented foreclosure moratoria (maybe not good news for someone hoping to pick one up next month). Open houses are seeing more visitors these last two weeks. The number of homes going into contract in the East Bay Hills has increased over the last several weeks. Four homes are pending in Piedmont; three went into contract within 19 days on market and two of these are scheduled to close after just two or three weeks in escrow. Zoom zoom zoom. I heard NPR do a story this a.m. wondering if the market is turning. Moreover, we're now seeing loans in the over-$729,500 realm for well-qualified buyers purchasing homes with sizeable downpayments--not the case for the last couple of months!
The numbers say that:
1. Nine homes have sold since 10/1, compared to 16 in the same window in '07, 11 in '06, and 21 in '05. Nothing new there--we knew that the number of sales was down nearly 50% from last year---
2. Those homes that sold, sold quickly--in an average 17 days on market. Buyers are very focused and quick to act when they see value, and sellers aren't taking chances or waiting around. The average price per square foot was about $500, but these were mostly less-expensive fixers--one larger, beautifully located and cared-for home sold for a bit over $700/sf, and for over $2 million. I'm not comfortable suggesting a decline in average prices beyond the 5% or so drop from our late 2005 peak that cropped up in last quarter's numbers.
3. The 25 homes actively seeking buyers have typically been on the market for 54 days and many have seen price cuts. Their current average price is $588/sf (still a tad above last quarter's average for sold homes), but four are hoping for upwards of $800/sf or more. Five are distressed--already owned by banks, or the owner is likely to be short of funds to close, meaning the lender(s) must agree to ''eat'' a portion of the outstanding balance [realtors are required to disclose this fact in the MLS now]. Seven homes have come off the market since 10/1. This is a noticeable increase, and suggests frustrated sellers and/or those who don't have many degrees of freedom for price cuts.
4. While seven out of the nine homes sold recently cost less than $1.5 million; half of the active homes started out at over $1.5 million. Maybe buyers feel more confident in these uncertain times with less expensive purchases or maybe the shortage of financing and anticipated bonuses is taking its toll at the high end.
So, the bottom line is that our market is in much better shape than surrounding areas (85% of newly pending transactions under $500,000 in the ''inner'' East Bay last week were distressed), and serious sellers are still finding serious buyers for their homes along the price spectrum. As households move to reduce discretionary expenses, I imagine we'll see more demand for the great schools that go along with a Piedmont purchase (if you have friends or colleagues thinking about a private school to public school move, ask me for the link and password to my Piedmont Information site. Among many photos, links and factoids, it's got links to all the key PUSD backgrounders as well as a net present value analysis of a Piedmont purchase (with Piedmont schools) vs. an Oakland purchase just outside our borders (and private schools). And of course I'd love to assist anyone you know as they plan an East Bay purchase or sale).
When's a Jumbo Loan a Jumbo Loan?
Don't forget that starting Jan. 1st, loans in our metro area over $625,500 will be considered ''jumbo'' as to rates and terms--the federal agencies will reduce the maximum loan size they are willing to purchase from area lenders by about $100,000 from that emergency/temporary figure of $729,750 established back in July. Organize any refis or new purchases that will need a loan in that $625-$729K range before 12/7 or 12/15 at the latest to make sure the loan closes before the jumbo definition changes!
Remodeling Workshop
Last night I headed over to the Rockridge Library to participate in a remodeling workshop organized by Amy Hutton of Winans Construction. Amy did a fabulous job outlining how best to get from the beginnings of a vision to the completion of a project. We talked about perils and pitfalls as well as how the relationship should work if all team members are hitting their stride. ''Cost-plus'' vs. set-price bids, how to think about change orders and who pays (other than that they should be rare if the scoping out and planning's done well), how permits and soils engineers fit in. Amy's a woman who knows her way around a Gantt chart and the critical path!
If you'd like a pdf version of her How to Make your Project a Success powerpoint presentation, email me, and the first to ask for it gets a copy of the 70-page Home Remodeling Green Building Guidelines from Build It Green.
Last night I headed over to the Rockridge Library to participate in a remodeling workshop organized by Amy Hutton of Winans Construction. Amy did a fabulous job outlining how best to get from the beginnings of a vision to the completion of a project. We talked about perils and pitfalls as well as how the relationship should work if all team members are hitting their stride. ''Cost-plus'' vs. set-price bids, how to think about change orders and who pays (other than that they should be rare if the scoping out and planning's done well), how permits and soils engineers fit in. Amy's a woman who knows her way around a Gantt chart and the critical path!
If you'd like a pdf version of her How to Make your Project a Success powerpoint presentation, email me, and the first to ask for it gets a copy of the 70-page Home Remodeling Green Building Guidelines from Build It Green.
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