Thursday, September 18, 2014

Sales Slow in August; Marin Judged Best County in State

Two items of note today. First, the rate of sales in the area for the month of August. Every year August seems to slow down as fewer sales are closed. There are a number of reasons for this, and they seem to be consistent from year to year. However, every year someone takes note of it and tries to imply that the market is slowing down overall.  That is NOT the case.

Lest you think this is just a Marin phenomenon, it covers the whole Bay Area. 

BAY AREA HOME SALES DOWN MORE THAN 10 PERCENT ANNUALLY
A slim supply of available homes, high prices, and abnormalities in the mortgage market combined to constrict sales volume in August across the nine-county Bay Area, according to a recent CoreLogic DataQuick report.down_arrow
The company’s data shows that 7,578 Bay Area homes and condominiums sold in August, a year-over-year decline of 12 percent. Sales volume was down in every Bay Area county last month, ranging from 20.3 percent in San Francisco to 1.3 percent in San Mateo.
On an annual basis, the Bay Area median sales price rose just about as much as volume decreased: 12.4 percent, according to CoreLogic DataQuick. All local counties showed year-over-year price increases, from 19.1 percent in Alameda to 1.6 percent in Napa.
The median sales price across the nine-county region reached $607,000 in August, about $60,000 shy of its summer 2007 peak as measured by the company.
An additional reason for this yearly slowdown that the folks at DataQuick don't mention is the effects of summer vacations.  August seems to always be the month to suffer most from people being away on vacation. Usually, this effect disappears with the advent of the post-Labor Day return to normalcy in many parts of local lifestyles. Folks finish vacations; kids go back to school; everyone's back to business and they can all start to refocus on the major things in life--like buying and selling homes.

SECOND ITEM:

Those of us who live here in Marin know this fact, and have probably done so for as long as they have lived here. It's a great place to live! Good schools, great natural beauty, great median income level; excellent shopping--the list goes on and on.  This is why people in the business of telling the world where the best places to live like looking at Marin.

A recent study by online real estate portal Movoto underscores what we here in the Bay Area have always believed: Our region is the best place to live in California.
Using a combination of statistics – including low unemployment and poverty levels and high income and median home sales price – Movoto ranked Marin County as the state’s best. Beyond the numbers, the company pointed to Marin’s lifestyle perks, including its spectacular scenery and varied cultural offerings.
What more can I say?  Enjoy!

And if you have any questions on your home--or anything else about real estate here, call us! Peter: (415) 279-6466; Jane: (415) 531-4091.

Friday, September 12, 2014

Some Healthy News For Your Benefit

Those of you who follow this blog are quite familiar with the info I try to provide about various aspects of the real estate market. Occasionally, I go a bit farther afield when I see something interesting that I wish to share. Today is one of these 'field trips'. I hope you enjoy and benefit.
Eating healthy and exercising regularly are known to reduce the risk of a heart attack — we all know this. But here’s a heart-smart tip you probably never heard of before: People who know and trust their neighbors are less likely to suffer heart attacks.Heart
It’s true. A first-of-its-kind study, published last month in the Journal of Epidemiology and Community Health, found that the more social connections you have in your neighborhood, the less likely you are to have a heart attack.
The study, conducted by psychologists at University of Michigan, assessed the social connectedness of more than 5,000 adults in urban, suburban, and rural areas over a four-year period.
The participants were asked to rate their neighbors’ trustworthiness, reliability and friendliness, which is collectively known as neighborhood cohesion, using a seven-point scale. During the span of the study period, 148 of the participants had heart attacks, but those who gave the highest ratings for neighborhood cohesion were found to be less likely to have a heart attack.
“Each unit of increase in neighborhood social cohesion was associated with a 17 percent reduced risk of heart attacks,” the study’s lead author, Eric Kim, told a writer for The Atlantic magazine. “If you compare the people who had the most versus the least neighborhood social cohesion, they had a 67 percent reduced risk of heart attack.”
Past studies have focused on how negative factors in a neighborhood — such as density of fast-food outlets, violence, noise, and poor air quality — can impact health. For example, University of Pennsylvania researchers found that abandoned buildings in an area could lead to isolation and hamper social relationships and feelings of mutual trust, which also could lead to poor physical health of nearby residents.
And while you're sharing your good feelings with your neighbors, if there's anything you need to know about your housing or the market in general, please feel free to call at any time. We'd be pleased to help. Peter: (415) 279-6466; Jane: (415) 531-4091.

Friday, September 05, 2014

Pacific Union Again in Inc. Magazine 5000!

In business, there are a few lists that all companies strive to be named to every year. One of these is put out by Inc. Magazine, and lists the 5000 fastest growing firms in the nation. 
Pacific Union is happy to share the news that our firm has again been named to the Inc. 5000 list, which ranks the 5,000  fastest-growing companies in the U.S. based on revenue growth from 2010 to 2013. This marks the second consecutive year that Pacific Union has been included in the list, and our firm moved up in the overall rankings substantially.Inc5000
Pacific Union closed 2013 with $5.5 billion in sales volume, for a three-year growth rate of 141 percent. And for the second year in a row, Pacific Union was the only full-service Bay Area-based real estate brokerage to make the list.
In terms of overall three-year growth ranking, Pacific Union moved up the Inc. 5000 list nearly 800 spots from last year, to 2,663.
Between 2010 and 2013, we added 179 of Northern California’s top real estate professionals. Pacific Union closed 2013 with 646 real estate professionals, the most of any California-based firm in our sector named to the list.
The industry accolade is one of several that Pacific Union has earned thus far in 2014. In June, The Wall Street Journal and REAL Trends ranked seven of our real estate professionals among the top 250 in the U.S. for closed 2013 sales volume. And this past spring, REAL Trends 500 Report named our firm No. 3 in the country by average home sales price.
So, if there's a question which firm to use to help you buy or sell your property at any time, there can be ONLY one answer: PACIFIC UNION! It is this quality that is the chief reason that The Richmonds are affiliated with Pacific Union. We operate only to the highest standards in the purchase and sale of real estate, and so does PU. Cal us for any assistance you may need! We'll be glad to help, and you'll be glad you called! Peter: (415) 279-6466; Jane: (415) 531-4091.

Pricing Your Home: It's Not An Exact Science

When it comes time to sell your home, the most important question often is: what should I price it at? Well, even with the help of an expert--your Realtor--it's not an exact science!
Pricing a home for sale is an inexact science — some owners might call it a crapshoot — and determining the right asking price involves both psychological and practical reasons, according to a recent article in The Wall Street Journal.Dollar sign
An asking price is primarily a negotiating tactic, Michael Seiler, professor of real estate and finance at The College of William & Mary, told The Wall Street Journal. “When you set a list price, you’re sending a signal to the market.”
Mike McCann, a real estate professional in Philadelphia, said in the article that most sellers overestimate the value of their home, and some real estate professionals may start with a  price that’s too high to avoid hard feelings or to get the seller’s business. Or, they may price it too low for a quick sale.
Setting the right asking price depends on a variety of practical factors, such as the condition of the property and recent sales activity in the area, but pricing research offers a few tips:
Precise prices suggest you are inflexible. Setting an exact asking price — say, $795,475 — could lead buyers to believe that the price is not negotiable. A round number such as $800,000 can indicate that you’re willing to consider other offers.
A few dollars can make a big difference. Pricing a property at $499,900 rather than $500,000 can subconsciously influence a buyer. It seems to defy logic, but researchers say $499,900 is perceived as a huge bargain compared with a home priced just $100 more.
A low starting price can backfire. A lower asking price may net a flurry of offers, but it may not lead to a higher sales price. “It creates a havoc that doesn’t serve anyone well,” Rebecca Walter, a real estate professional in Portland, Ore., told The Wall Street Journal.
Pricing strategies only go so far, however. Ultimately, determining a home’s real value of requires knowledge of the local real estate market and access to recent sales data. That’s where the assistance of a local real estate professional can be most valuable.
Real estate professionals typically compile neighborhood sales data to prepare a comparative market analysis, which provides a sensible starting point for price negotiations. 
Seiler, the real estate professor mentioned in the article, said that without comparable sales data, “an appraiser will have no clue what a property is worth, and a buyer wouldn’t know either.”
One thing you can do to increase the likelihood that you've priced correctly is to hire a professional Realtor. Pricing a home to your best advantage is one of the things we know from years of experience. So, thinking of selling--or just interested in the value of your home? Give us a call! As always, we'd be happy to assist. Peter: (415) 279-6466; Jane: (415) 531-4091.

Thursday, August 28, 2014

Investor Competition Eases

There have been many different factors in the strong run up in housing prices in the Bay Area (and Marin County) over the past few years. These include a shortage of inventory at all price levels, strengthening economy and a new surge in tech industry companies and development. Another is the interest in buying by investors. Frequently, this last one has been the cause of some people either failing to realize their purchase goals of a home to live in or having to pay a great deal more for the purchase than they had originally planned.

Well, that has apparently begun to change.

Good news for Bay Area buyers: A recent survey found that investors today are far less active in the region’s real estate markets than in years past, helping to ease some of the fierce competition for homes.
Toy housesThe news is especially welcome for first-time buyers, who have struggled to compete against well-heeled investors paying all cash for starter homes and then turning them into rental properties or waiting a few months and flipping them at even higher price points.
The California Association of Realtors’ 2014 Investor Survey, conducted in May and released to the public on Wednesday, found that  investors are changing their strategies and moving away from buying homes in more popular, urban areas in favor of rural locations of the state where better deals can be found.
In 2014, nearly half (45 percent) of California investors said they purchased properties in rural counties such as Kern, Fresno, Merced, San Joaquin, and Tulare, up from 27 percent in 2013, according to the survey.
Meanwhile, 15 percent of investors purchased properties in Northern California in 2014, down significantly from 27 percent in 2013.
The organization gave an early look at some of the survey data two weeks ago, and Pacific Union reported at the time that rising home prices have curtailed investment activity in high-dollar Bay Area markets like Silicon Valley.
The survey also found that 67 percent of investors paid cash, and one-third were residents of foreign countries, with China, Mexico, Taiwan, and India being the top countries of origin. Investors owned an average of 8.3 properties in 2014, up from 6.5 properties last year.
Reflecting the recovering housing market, the majority of investment properties purchased in the last year (70 percent) were equity sales, while 18 percent were short sales and 12 percent were foreclosures.
Most investors said they made minor or no repairs to the properties, and 55 percent said they intend to sell them within six years.
So, if you're actively seeking that 'dream' home, or have thought about taking some time out from your search, now may be the perfect time to ratchet up the pace of your search. Questions on the market? Call us! Peter: (415) 279-6466; Jane: (415) 531-4091.
Separately, if you are thinking of selling, but not sure of your home's value, we can also help in that regard. So, either way--buy or sell, let us help you make the best decision.

Saturday, August 23, 2014

Credit Standards Easing--Loans Easier to Qualify

Well, after some very intense analysis and review by various lenders and credit scoring agencies, things have gotten a bit easier for buyers. The basic parameters in credit scoring, a major portion of credit analysis on potential borrowers has been loosened a bit.
More people will qualify for home loans, and at lower interest rates, thanks to recent policy changes by several U.S. credit agencies.Yellow road sign bearing the word "credit"
Fair Isaac Co.’s FICO credit-scoring system garnered top headlines last week with the news that medical bills and paid-off debts would no longer be counted against consumers in computing their FICO scores. But other credit agencies have also eased their reporting rules in recent months.
The net result will be higher credit scores — perhaps an additional 25 points, Fair Isaac said — enabling some homebuyers to qualify for a loan that otherwise would have been out of reach or at a higher interest rate.
“This move will ultimately make a real difference in the lives of millions of Americans, who have been shut out of the housing market or forced to pay higher mortgage interest rates because of flawed credit scores,” Steve Brown, president of the National Association of Realtors, said in a statement. “Since the housing crash, overly restrictive lending has been the greatest obstacle to home ownership.”
The change follows a recent study by the federal Consumer Financial Protection Bureau that showed that both paid and unpaid medical debts were unfairly penalizing consumers’ credit ratings. An estimated 64 million Americans have a medical-collection item on their credit reports, according to Nick Clements of MagnifyMoney, a personal-finance website.
Two of the nation’s biggest credit bureaus also recently changed their credit-reporting policies.
Both Experian and TransUnion have added verified rental-payment data into credit files, to be used to compute a consumer’s credit score when applying for a mortgage and other type of loan. Experian said the change especially favors consumers with little or no credit history, and a TransUnion study showed that including rental data raised credit scores by 10 points or more for 20 percent of renters.
Together, the changes at Fair Isaac, Experian, and TransUnion could make a noticeable difference in Northern California real estate markets.
Bay Area residents have some of the highest credit scores in the nation, but buyers face added loan pressures here because home prices are far above national averages.
TransUnion recently revealed that the San Jose-Sunnyvale-Santa Clara metro area is tied with the Minneapolis-St. Paul area for the highest percentage of “A” credit scores in the United States, with 23.5 percent of its residents scoring between 900 and 990 on the VantageScore rating system.
The San Francisco-Oakland-Fremont metro area had the second-highest percentage of “A” scores — 22.9 percent.
But looking at the VantageScore numbers by another metric shows the challenges still facing homebuyers here: Residents of the San Jose metro area collectively have an average score of 700 on the 501-to-990 scale — a low “C” grade in terms of credit worthiness. San Francisco metro area residents have an average score of 696 — a high “D.”
Those numbers show how even in a high-scoring region like the Bay Area, plenty of consumers — and potential homebuyers — will benefit from increased credit scores.
What does this mean for you? Well, if you're a potential seller, it means that a larger pool of potential buyers just arrived, as easier approval standards means more people qualifying for loans, and thus able to purchase your home.
If you're a buyer, it just made things easier for you to qualify for a loan to buy that dream home.
Questions about the process or the market, or the value of your home? We can handle them all. Give us a call! Peter: (415) 279-6466; Jane: (415) 531-4091. We'd be happy to help you out!

Friday, August 08, 2014

Continued Population Growth Fuels Market

One thing that's as true as death and taxes is that for someone to want to buy your home, there has to be someone in the market. That someone must have a good job and prospects for continuation of that job. If there are enough positions of that nature in an area, the market grows. So it is with the Bay Area.
The Bay Area’s tech-industry-driven economy continues to add extremely desirable and high-paying jobs, attracting talented workers from around the nation and globe. But even though our region’s phenomenal economic growth likely will begin to slow over the next couple of years, intense demand for housing is almost certainly here to stay thanks to a pronounced lack of available homes.
“We’re getting closer to full employment,” says Stephen Levy, director and senior economist of Palo Alto-based Center for Continuing Study of the California Economy. “And what that means is that as we near full employment, that’s going to bring in people, which will add to the housing demand.”
May statistics from the California Employment Development Department show that each one of our Bay Area counties boasts an unemployment rate lower than the statewide average of 7.6 percent. Job growth remains particularly strong in Marin, Napa, San Francisco, and San Mateo counties, all of which have unemployment rates of less than 5 percent.
Levy believes that the Bay Area’s unemployment rate will never return to dot-com-era lows, when it hovered in the 2 to 3 percent range in San Francisco and Silicon Valley. However, he forecasts that even though job growth will level off over the next two years, the Bay Area will continue to outperform the rest of the country.
Population Growth Outpacing New Housing in Key Markets
Since the U.S. began to emerge from the Great Recession in 2010, the Bay Area’s population rate has jumped sizably, according to California Department of Finance data. Over the past four years, the number of residents in San Francisco and San Mateo counties has grown by nearly 4 percent while increasing by almost 5 percent in Santa Clara County.
But those counties have failed to build enough new housing units to keep up with the expanding populace. Since 2010, new housing has grown by just 2 percent in Santa Clara County, 1.3 percent in San Francisco, and 0.9 percent in San Mateo County.
“Peninsula prices and rents will continue to outpace the state and national average unless we see a dramatic increase in supply, and even then it would be snapped up pretty quickly,” Levy says.
Economic Climate Much More Stable Than in Dot-Com Days
As was the case in the dot-com boom and subsequent bust, the tech industry remains the primary driver of Bay Area employment growth. However, Levy believes that our current economy is far less frenetic than it was 15 years ago.
“I think it’s quite different,” he says. “These are real companies, and they have customers, profits, and burgeoning sales. The dot-com era was more about business plans.”
Still, technology companies aren’t the only businesses fueling Bay Area job growth. Other industries, including hospitality, health care, and construction, are seeing employment upticks, Levy says. However, he cautions that tremendous growth in the Internet sector could eventually slow expansion in other industries, including brick-and-mortar retail and financial services.
While the Bay Area’s economic outlook appears solid for the foreseeable future, the housing shortage may eventually impede growth, as workers could become wary of relocating to an area where finding a home is so difficult. Therefore, new construction remains a crucial factor in keeping our region’s economy moving upward and onward.
“I think [our economy] will always grow, but absolutely, housing poses a constraint to our growth over the long term,” Levy says. “The lack of housing could take some of the bloom off of the rose and limit some of the growth that might otherwise be there.”
Similar situations are becoming the rule here in Marin County.  This is because much of the spill-over from the growth of tech industry jobs in San Francisco is oriented to Marin with its easy commute and top quality schools.
Thinking of selling? Curious what your home is worth? Call us! We'll provide you with the information and assistance that you need to make an intelligent and successful decision. Peter: (415) 279-6466; Jane: (415) 531-4091.

Wednesday, July 23, 2014

PacUnion Cutting Edge Technology Scores Again!

Like any business looking to provide its clientele the best service, coupled with the most advanced technology, Pacific Union has always been at the forefront of real estate technology and service.  The latest example is the newly announced Coming Soon feature provided in conjunction with Zillow.

Zillow recently unveiled its Coming Soon feature, a forward-thinking initiative that lets real estate professionals advertise exclusive property listings up to 30 days before they are loaded into the MLS. While other companies in our industry may react to this disruptive move with fear and resistance, Pacific Union is choosing to test Zillow’s program and determine whether we can leverage it to our clients’ advantage.MarkMcLaughlin_small
According to Zillow’s own data, its website has 81 million monthly unique users, and traffic has grown by 50 percent since January. This is a huge community of consumers viewing homes for sale and an amazing opportunity for Pacific Union to test the quality of Zillow’s traffic. We do not yet know if Zillow’s user base consists of qualified buyers or simply consumers looking for remodeling ideas or viewing dream homes they likely cannot afford.
Subverting the MLS
With the Coming Soon program, Zillow has stepped in front of the MLS to fill a void in the industry and give consumers, as well as some real estate professionals and brokers, what they have been wanting. While some MLS operators share premarket listings privately with paid subscribers, none of them publicly display such listings.
If Zillow’s unique users are indeed qualified homebuyers, this move could be a wake-up call to MLS operators that to stay relevant, they must deliver what consumers and their members want rather than making decisions based on preserving their perceived control in the industry. This includes embracing technology that homebuyers and sellers describe a need for – like the Coming Soon listings.
Coming Soon listings may prove to have a particularly large impact in highly competitive real estate markets like the Bay Area. If Zillow’s traffic consists of serious homebuyers, real estate professionals will gain the ability to actively market their properties before uploading them to the MLS, which have many “rules” in place designed to maintain industry control instead of meeting market demand.
Qualified buyers, meanwhile, will have advanced time to research a home and prepare an offer, crucial ingredients to success, since many Bay Area homes go under contract as soon as they hit the market.
How We’re Approaching Zillow’s Coming Soon
Pacific Union believes that if Zillow’s traffic indeed comes from qualified buyers, giving our real estate professionals and their clients the ability to market homes before they are listed on the MLS is tremendously beneficial and represents yet another tool to help them succeed. To that end we’re implementing a technology interface in early August that will allow our professionals to seamlessly upload pre-MLS listings to Zillow’s Coming Soon offering at no cost.
Pacific Union primarily will be testing the quality of Zillow’s unique users. If the Coming Soon feature generates qualified buyers and closed escrows, we will value the service.
While technology will doubtlessly play a key role in our industry moving forward, we do not believe it can replace or remove the trust, knowledge, and advice that a Pacific Union real estate professional offers clients.
For example, Zillow’s Zestimates for eight of the nine Bay Area counties receive just two-star accuracy ratings and only come within 10 percent of the sales price about half of the time. And in San Francisco County Zillow’s margin for error comes in as high as 12 percent. Therefore, it remains clear to Pacific Union and our clients that the Zestimate is not currently a credible industry tool.
By contrast, seasoned real estate professionals can predict a home’s value with a much higher degree of certainty, as they provide a level of trusted local knowledge and expert neighborhood advice that a website simply cannot replicate.
Zillow’s Coming Soon feature is just the latest in a line of technology innovations designed to propel our industry forward. As technology continues to alter the way real estate professionals and brokerages do business, Pacific Union will evaluate each new innovation carefully and adopt the ones that we feel deliver the largest benefits to our clients.
We will know shortly if Coming Soon is a valuable industry innovation and whether Zillow’s huge user base really contains serious homebuyers.
Best of all, you, the client, will get the benefit without having to worry if your Realtor is keeping pace with the market!
Questions on the market? Want a no obligation valuation of your home? Call us! We'd be happy to assist. Peter: (415) 279-6466; Jane: (415) 531-4091.