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October 31, 2014

What happens when a seller won’t accept a full-listing offer?

Sellers are not obligated to accept any offer whatsoever, even one that is at the full listing price. That said, to head down that road can mean creating turbulence for you as well as your brokerage. It’s not just the seller who faces wrath when he or she rejects a full-price offer, but that wrath can also be directed at you as well.

Who needs that?

As an agent, it is up to both you and your seller to determine the listing price on a given property. Some believe in listing at a low – and ultimately unacceptable – price, but that seems like a waste of time. Rather, you should figure out a price that your seller is willing to accept in the event that that is the best offer received after you’ve conducted a full-court marketing campaign, having fully exposed the home to the market. That doesn’t apply to pre-emptive offers. I never lost a selling due to this requirement on my part.

By the way, should your seller refuse a full-price offer that carries other acceptable terms, MLS regulations require that you change the price in the database immediately to what the seller would accept. Take this seriously. Non-compliance is subject to a possible $500 fine. To me, this strongly implies a certain intent: if you knowingly price below what your seller will accept, this constitutes a violation of the spirit of the MLS rules regarding good-faith advertising as well as cooperation between brokers. MLS rules read in part: If the seller of any listed property filed with the service refuses to accept a written offer satisfying the terms and conditions stated in the listing, such fact shall be transmitted immediately to the service and to all participants and subscribers.

Telling your buyers that everything is going over asking price is disturbing as well, because it implies that it doesn’t matter how overpriced a listing is – the motivated buyer should pay more. This simply isn’t the case.

Dreaming of San Francisco? Cece Blase offers local advice to San Francisco buyers, sellers and owners– and feeds the dreams of those who wish they could live in Tony Bennett’s ‘City by the Bay.’ Call 415-577-0809 or email cblase@paragon-re.com. www.ceceblase.com

October 30, 2014

Bay Area Demographics

18 charted analyses of ancestry, affluence, education, real estate,
politics, poverty and employment for San Francisco, Marin, Napa,
Sonoma, San Mateo, Santa Clara, Alameda & Contra Costa Counties.

4th Quarter 2014, Paragon Special Report

These charts are mostly based on U.S. Census surveys from 2010 to 2013. Each of the 8 counties examined contains areas of widely varying demographics, and the multiple reports analyzed (6+ for each county) contain counts and estimates made at different times. Though these statistics are broad overviews, we still found many fascinating insights – and hope you will as well.

Adjusting your screen-view to zoom 150% will make the charts easier to read.

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Ancestry, Race & Age

For the most part, the ancestry and race categories used below
are as designated in the U.S. Census reports.

Ancestry: This first chart is a collated overview of the 8 counties. The Bay Area is one of the most multi-cultural places on earth, but (not broken out on this chart) this diversity is not evenly spread: Different ethnic and national groups often cluster in specific counties. For example, San Francisco has the largest populations with Chinese or Russian ancestry; Santa Clara has, by far, the greatest number of residents from India, Vietnam or Mexico; Alameda leads in those of Portuguese or Pacific Island heritage. For breakdowns by county, U.S. Census reports can be accessed at http://quickfacts.census.gov/qfd/index.html.

Race: Marin County has by far the largest percentage white (non-Hispanic) population at 73%, followed by Sonoma and Napa. San Francisco has the largest Asian percentage at 34.4%, with Santa Clara just behind at 34.1%. Santa Clara is the only county where white isn’t the largest group – Asian is bigger by a tiny margin. Napa has the largest Hispanic percentage at 33%, with 5 other counties between 23% and 27%. Alameda has the most substantial percentage black population at 12%.

Foreign-Born: The foreign-born population in the Bay Area is large (behind only New York, Miami, LA and Chicago) with again, different groups predominating in different counties. About 50% of our foreign-born residents have acquired U.S. citizenship.

Children & Residents Living Alone: It has famously been said that San Francisco has more dogs than children, and at 13.4%, SF has the lowest percentage of residents under 18 of any major U.S. city. The other counties run close to the national percentage of 23%. San Francisco also has a much higher proportion of residents living alone than the other 7 counties – which probably correlates with a more urban lifestyle.

It’s interesting to note (not delineated on the chart) that though SF has relatively few children, its population aged 25 to 39 is very high, at just below 30%. Other Bay Area counties run from 16% (Marin) to 23% (Santa Clara). Demographers have noted that younger, post-college adults are moving into urban centers in large numbers, and this is clearly occurring in San Francisco. The city’s young, high-tech, start-up environment is undoubtedly supercharging this phenomenon.

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Affluence, Poverty, Education & Politics

Median Household Income: Many factors impact this statistic: household size, level of education, percentages of homeowners vs. renters, median age and of course, employment. Marin and Santa Clara are at the top of the list for highest household income. Obviously, various towns and neighborhoods – such as Pacific Heights, Ross, Atherton, Piedmont, Blackhawk – far exceed the figures in the chart below.

Poverty: According to the 2013 Wealth-X report, the Bay Area has the 3rd highest number of ultra-high-net-worth residents in the country, behind NY and LA. According to SFLuxe, the Bay Area is now home to over 70 billionaires – and it seems one can’t turn around in Safeway anymore without bumping into another new billionaire.

But surging affluence isn’t the only story.

The U.S. poverty-level income threshold does not vary by geographic region: For a family of 4, the national threshold is approximately $23,500. According to a Stanford think tank, adjusting for much higher local costs of living (especially housing) raises that threshold to $31,000 – $36,500 in Bay Area counties. In San Francisco, that increases the percentage of residents living in poverty to 23% and in Napa to 26%. Adjusted or not, the percentages add up to many hundreds of thousands of people – and this seems an appropriate place to remind all of us not to forget the neediest this holiday season.

Unemployment Rates: A big factor behind Bay Area economic conditions has been the strong growth in employment in recent years – in high-tech certainly, but also in the financial, medical, retail, construction and other industries. Many of these new jobs are very well paid.

Education: Some Bay Area counties are among the most educated in the country – not a big surprise considering the presence of 3 of the world’s great universities, and the Bay Area’s role as a hub for various high-education industries. Among U.S. major cities, San Francisco usually ranks near the top of the list just below Washington D.C. and Seattle.

Political Party Registration: This chart is self-explanatory. The Bay Area is a very blue region in a very blue state.

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Housing, Real Estate, Prices & Rents

Median Home Prices: Apples to apples, San Francisco has the most expensive real estate in the Bay Area, followed by San Mateo and Marin. But all the counties include diverse neighborhoods featuring home prices ranging from relatively low to very high. One thing that stands out is the city’s distinctive condo market: the median price for 2-bedroom condos is just a tad lower than its median price for 3-bedroom houses. The reasons are twofold: firstly, very generally speaking, condos predominate in the more affluent city neighborhoods, while houses predominate in the less affluent. Secondly, thousands of new condos have been built in the last 10 years, or are under construction now, and by and large, they are of luxury or “ultra-luxury” quality and cost.

For a Million Dollars: Consider this infographic to be very approximate indeed, but it gives an idea of what one would get in square footage for $1,000,000 at each county’s overall house and condo average dollar-per-square-foot value. For the money, one gets more than twice the space in Contra Costa or Sonoma as in San Francisco or San Mateo. In many parts of the country, one could double or triple the square footage again.

Case-Shiller Home-Price Trends: The Case-Shiller SF Metro Area does not cover all 8 of the Bay Area counties, but it generally applies to the overall market. If Case-Shiller went back a bit further, we would see the late seventies/early eighties recession on this chart. From recession – which in the last 30-odd years has typically lasted 4-5 years – comes recovery (typically very robust recovery). Recovery usually takes 5-7 years to become utterly “over-exuberant,” which leads to a correction – and the next recession. We are still less than 3 years into our current recovery – which doesn’t mean that past trends will hold true in the future.

This chart aggregating all the sales of 5 counties is a huge simplification of hundreds of different micro-markets: Different areas and price segments of the Bay Area housing market had 2004 – 2008 bubbles and crashes of vastly different magnitudes. The lowest price segment rose and crashed the most (think “subprime loans”) and, though recovering dramatically, is still well below 2006 peak values. The higher priced housing segment had a much smaller bubble and crash, and has now exceeded its previous peak values of 2007-2008, in many cases by substantial margins. All 3 home price segments – low, middle and high – are now approximately 95% – 97% above their values of year 2000 (denoted as “100” on the chart).

Average Asking Rents: In the Bay Area, rising apartment rents and rising home prices have gone hand in hand, a big social, economic and political issue right now. Per the analytics firm Reis, San Jose, Oakland and Francisco are 3 of the 4 hottest rental markets in the country, as measured by rent appreciation.

Homeownership: With San Francisco’s homeownership rate of 37%, tenants outnumber homeowners by a large margin – and, not surprisingly, the city has some of the strongest rent and eviction controls in the country. (SF rent-limitation controls do not typically affect vacant or recently built apartments, so they do not reduce the “asking rent” values seen in the earlier chart.)

Market Size: Santa Clara and the two East Bay counties each have more than twice as many home sales as any of the other 5 counties. This is mostly due to significantly higher populations, but San Francisco’s relatively low number of home sales is also caused by the fact that almost two thirds of its units are rental housing: Thus, SF has more people but fewer home sales than San Mateo. Very limited supply amid huge demand is a big factor in its rising home prices.

Era of Construction: This chart illustrates how empty the Bay Area was 75 years ago, before World War II: Almost 50% of San Francisco’s housing was built prior to 1940, but in 6 of the other counties, the percentage falls to 12% or lower. In Santa Clara and Contra Costa, it drops to 5% – there were a lot of open fields where housing developments exist now.

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Population, Density & Size

Population & Population Density: Santa Clara and Alameda have the largest populations of the 8 counties. San Francisco, the second most densely populated city in the country (far behind Manhattan), has a population density 95 times that of Napa County.

Size in Square Miles: This chart reminds us what a small place San Francisco really is – and its inability to expand (except upward) plays an interesting role in many of its economic and social dynamics. Sonoma is the largest of the 8 counties and it is 33 times as large as San Francisco County.

October 29, 2014

Be aware of a new tenant buy-out law

Whether you’re a tenant or a landlord in San Francisco, you’re going to want to learn more about the proposed Tenant Buyout Agreements ordinance. SocketSite has posted seven key points that you’ll want to review.

Keep in mind that for every action there is an equal and opposite reaction. This new law will likely lead to more Ellis Act evictions, which could become the more appealing, less complicated alternative. The net effect will be less rental housing stock. It’s been passed by the Board of Supervisors, but not yet signed by the mayor.

San Francisco Supervisors Avalos, Campos, Kim and Mar are sponsoring the ordinance, with Farrell dissenting in committee. The ordinance will:

1) Require notice prior to any negotiation. Landlords will be required to provide tenants with written notice of their rights and file a Rent Board form indicating which rental unit could be the subject for the negotiations.

2) Require written agreements. All buyout agreements must be in writing and include tenant-rights provisions.

3) Provide a 45-day recission period for tenants. Tenants may rescind a buyout agreement for up to 45 days after execution.

4) Require buyout agreements to be filed with the city and made public. Landlords will be required to file copies of buyout agreements with the Rent Board along with paying a filing fee.

5) Require an annual reporting of all buyouts. The Rent Board would be required to provide an annual report to the Board of Supervisors.

6) Provide for penalties for non-compliance. These would be both monetary and civil.

7) Prohibit condo conversions for buyout-emptied units. This holds for buyout agreements signed after October 2014.

October 29, 2014

August Case-Shiller Index Report

The August Case-Shiller Index report released today showed a small home price decline for the 5 counties of the SF Metro Area. Autumn’s numbers will give us a clearer indication as to whether this is the beginning of a flattening or declining price trend or simply the not untypical indication of a summer adjustment from the spring frenzy. PDFs are attached.

October 27, 2014

30-year rates at 16-month low

Interest rates are continuing to remain below 4 percent, with the rates for 30-year fixed mortgages at a 16-month low. That’s according to Zillow Mortgages, which reported that the current rate is 3.81 percent after having hovered around 3.85 percent for the majority of the week and then falling to 3.7 percent before climbing back up.

“Last week mortgage rates experienced dramatic inter-day volatility, falling Wednesday to their lowest level since May 2013 fueled by global economic concerns and the potential threat of an Ebola epidemic,” Zillow vice president of mortgages Erin Lantz said. “With little mortgage market-moving data scheduled to be released next week, we expect rates to remain stable.”

Zillow reported that the 15-year fixed mortgage rate is currently 2.97 percent, with a 2.80 percent rate for 5/1 ARMs. In addition, Zillow forecasts that tomorrow’s seasonally adjusted Mortgage Bankers Association Weekly Application Index will show that purchase loan activity is up by 5 percent from the previous week.

Meanwhile, Freddie Mac said that mortgage rates were down for a fifth straight week, which holds the possibility of bringing forth a wave of refinancing and even enticing Americans to purchase their first home of their own. Real estate data provider CoreLogic said that nearly half of all homes with a mortgage carry a rate of 4.3 percent or less, however, and for these homeowners that figure means that it isn’t worth it to refinance. However, these figures could certainly nudge reluctant buyers off the fence and into the active market before things cool down leading up to the holidays.

Looking for your own piece of San Francisco paradise? Get in touch!

October 25, 2014

Mortgage Interest Rates Just Hit a 16-month Low

October 24, 2014

This Weekend: Halloween International Ball, Bollywood Blast

Looking for something spooky to do this weekend? Why not attend the Halloween International Ball, taking place Saturday, October 25 at 9 p.m. to Sunday, October 26 at 2 a.m. at the W Hotel in San Francisco?

Billed as “Every year, San Francisco’s Absolute Best & Biggest!”, the ball features three separate dance floors with seven world-renowned disc jockeys. This one-of-a-kind special Halloween event is produced by Aykut Events and will offer a magically decorated three separate rooms with unparalled luxury in true high-class Halloween style.

Tickets run from $30 to $70. Performers include Santero, Trevor Simpson, Aykut and Dr. T. But if you’re not into the ball, here’s another event for you …

The Bollywood Blast is a dance event benefiting Trikone, a nonprofit organization serving LGBTQ people of South Asian origin in the San Francisco Bay Area. It takes place at Club OMG! (43 6th Street, San Francisco) on Saturday, October 25 at 9 p.m. This is the Diwali party, so all traditional desi attire is highly encouraged. DJ SSHaaN will be spinning the best in Bollywood as well as classic oldies. General admission after 9 p.m. is $12 at the door, with limited early-bird deeply discounted tickets available online for $5. Limited early bird tickets are available online for $7. Advance tickets are available online for $9. Fifteen percent of the total proceeds from ticket and bar sales will be donated to Trikone.

Whatever you choose to do, please have a happy and safe weekend!

October 24, 2014

From our NorCal network : The Artisan Group

18 Golf Links
Glenbrook, NV
Offered at $8,950,000

For more information about this property or a referral to other areas of Northern California, please contact me.

October 23, 2014

How did my summer sales go?

My sales this summer were concentrated around SOMA/Yerba Buena and Potrero, where I saw a flattening market. Although my sellers achieved good prices, we didn’t see the frenzy of buyers coming to the table that I experienced in the spring. We have a variety of theories on why it was so slow. The most obvious is that it reflected a seasonal trend. Others thought buyer fatigue had set in, with home shoppers worn out and wanting to take a break from competing and losing out over and over again.

One of my associates at Paragon thinks the neighborhoods “South of the Slot” (the “slot” being Market Street) are a bellwether for the rest of the city. Whether this cooling trend will spread to the re- hot districts like Mission, Bernal or the entry-level markets like the Excelsior or Portola Districts remains to be seen.

In the meantime, the upper-end market continues to be robust, provided the homes are on good blocks with no killer flaws. The magical “three bedrooms/two baths on one floor” (which I call the “Unicorn Layout”) still sells like hotcakes and our $2.5 to $4.5M market remains quite active in the northern neighborhoods.

Right now, when I look at specific calls for buyer needs from top agents in the city, the homes that seem hardest to find are big, sleek single families in the Mission/Dolores Park neighborhoods, or condominiums with big square footage on the north side of town.

If you’re looking for your own slice of paradise in the city, give me a call! I’d be thrilled to work with you to find exactly what you need.

October 22, 2014

Judge’s decision a victory for S.F. landlords

Apartment owners in San Francisco found themselves victorious yesterday when a federal judge struck down the city’s effort to block evicted tenants from increasing rents by hiking relocation fees that landlords who go out of the rental business must pay to such tenants.

That law took force in June. It mandates that property owners must pay displaced tenants the difference for two years between current rent and the money required to rent a comparable unit in the city at market rates. In most court cases, according to the San Francisco Chronicle, that amount exceeds $100,000.

U.S. District Judge Charles Breyer said that was a violation of property rights because it means owners are paying for conditions that they didn’t cause, primarily the gap between market rates and maximum charges under rent control as well as the rapidly increasing price of rent. During the one-day trial of the case this month, Breyer said (as quoted by the Chron) that the ordinance “seeks to force the property owner to pay for a broad public problem not of the owner’s making. A property owner did not cause the high market rent to which a tenant who chooses to stay in San Francisco might be exposed, nor cause the lower rent-controlled rate the tenant previously enjoyed.”

He added that the ordinance did not require tenants to spend fees on replacement San Francisco housing – or housing anywhere else. The ruling was stayed until Friday so that the city has time to request a federal appeals court to intervene. City Attorney Dennis Herrera is said by a spokesman to be “very disappointed” by the ruling and in the next few days will decide whether to appeal.

CECE BLASE (DRE 00926690) Compass Real Estate 1400 Van Ness Avenue San Francisco, CA 94109 Direct: 415.577.0809 cece@sfrealestatebuzz.com

CECE BLASE
(DRE 00926690)
Compass Real Estate
1400 Van Ness Avenue
San Francisco, CA 94109
Direct: 415.577.0809
cece@sfrealestatebuzz.com