Tag Archives: real estate blog

Crazy Urban Legend Hits the Real Estate World

Be forewarned — no, this is not about kidney harvestingNigerian Lottery winnings, or Bill Gates giving everyone lots of money for forwarding an email — there is an email making the rounds titled “HR 2454: CAP AND TRADE ENERGY BILL”, which purports that new legislation will require all homes to retroactively pass new energy standards before they are sold.

Some even say that all homes will now be required to get a “label” for your house every year, proving that your home meets new energy standards.

This is all patently and unequivocally FALSE. (and you can even checkSnopes.com here to doublecheck)

Firstly, whoever started this email has a serious conspiracy theory complex. They also probably fall into the category of “birther”, “teabagger party member”, or “Glenn Beck-lover”.

Bottom line, our gub’mint is not going to do anything – ANYTHING – that will adversely affect the real estate market, which is absolutely one of the key elements in our ongoing, slow economic recovery. Why do you think they recently overwhelmingly voted to extend the first time buyer $8K tax credit bill, as well as extend the $729K conforming loan limit? They want to encourage people to have more confidence in home ownership.

Anyway, I also consulted our National Association of Realtors (NAR) position on this, and below is what it said. The most revealing statement, which contradicts this email is that this bill  “Does not create a federal energy audit requirement for real property”

“The U.S. House of Representatives approved H.R. 2454, the American Clean Energy and Security Act by Reps. Waxman (D‐CA) and Markey (D‐MA). Following NAR’s long‐standing policy to only take a position on legislation, or provisions within legislation that have a direct affect on real estate, NAR worked with our Congressional allies to strip the Energy Bill of provisions that would have adversely affected our industry.

After multiple consultations with the NAR Climate Presidential Advisory Group, the NAR Land Use, Property Rights and Environment Committee, and state associations who had dealt with energy audit legislation at the state level, the Land Use, Property Rights and Environment Committee directed NAR staff to concentrate on the real estate provisions in the bill.  As a result, NAR issued calls for action and made this a talking point for Capitol Hill visits during its recent Midyear meeting.

Overall, REALTORS® succeeded in making a number of positive changes affecting the real estate provisions of the bill. The House‐approved bill:

  • Does not create a federal energy audit requirement for real property;
  • Exempts existing homes and buildings from any federal guidelines for new construction energy efficiency information labels.
  • Prohibits the implementation of any labeling during a sales transaction.
  • Leaves the decision to states as to whether to require energy audits, disclosures, etc.
  • Provides property owners with significant financial incentives, matching grants and tools to make property improvements and reduce their energy bills;
  • Prohibits the Environmental Protection Agency from regulating residential and commercial buildings under the Clean Air Act;
  • Eliminated an early proposal to allow citizens to sue over minor climate risks under the Clean Air Act; and Establishes green building incentives for HUD housing, including a loan program for renewable energy, block grants and credit for upgrades in mortgage underwriting.”
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Federal Tax Credit For Home Buyers Gets Extended – Well, Happy Early Christmas!

fed housing tax creditAn early Christmas present for many home buyers came in the form of the extension of the federal tax credit for home buyers, and was signed into law by President Obama Friday, Nov. 6.  The tax credit, which was set to expire Nov. 30, has been extended through April 30, 2010 with a 60-day extension if a binding contract is in place prior to deadline.  It also was expanded to include existing homeowners who have lived in their primary residences for five consecutive years out of the last eight years.

For all kinds of FAQs (aka, “Everything You Wanted to Know About the Tax Credit….But Were Afraid to Ask), see the official website here.

First-time home buyers still may be eligible for a tax credit of up to $8,000, while existing homeowners may receive a credit of up to $6,500.  The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers, to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000 in both instances.

Under additional provisions in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The bill maintains the provision that home buyers do not have to repay the credit provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.

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Recent Sales in Mt. Carmel ‘Hood

It’s been awhile, so here’s a quick snapshot of some recent sales that have been going on in the Mt. Carmel area. Firstly though, looking at some overall statistics, I’d say the one word to describe it is “HEALTHY”.

Here’s the bottom line, for the last 3 months of sales:

Average Percent of List Price: 99%

Average $ per sq. ft.: $537

Average Days on Market (DOM): 33

 

188 Inner Circle: List price (LP): $579K, Sale price (SP): $612K;  9 DOM

313 Topaz St.: LP: $739K, SP: $730K;  12 DOM

1740 Whipple Ave: LP: $650K, SP: $675K;  14 DOM

531 King St.: LP: $899K, SP: $890K;  6 DOM

23 Myrtle St.: LP: $1.035M, SP: $1.035M;  17 DOM

516 Quartz St.: LP: $608K, SP: $585K;  28 DOM

15 Iris St.: LP: $1,149,900, SP: $1,032,300;  91 DOM

45 Hudson St.: LP: $1.795M, SP: $1,599,950;  90 DOM

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Don’t Forget to Vote Today!

voting

Redwood Citizens, don’t forget to vote today, November 3rd! The following info on today’s election also be found on theCounty of San Mateo’s web site:

The Consolidated Municipal, School and Special District Election will be held on Tues., Nov. 3. The polls will be open from 7 a.m. to 8 p.m.

According to Chief Elections Officer Warren Slocum,”All voters should double-check the location of their polling place before they head out to vote in these important local elections,” All jurisdictions in the county are participating except Daly City and Pacifica as they do not have candidates or measures on the ballot.

Voters can lookup the location of their polling place online at www.shapethefuture.org or by calling the Elections Office at (650) 312-5222. Voters can also view (or print) their Sample Ballot. And for those that vote by mail, the website provides peace of mind through the Track & Confirm feature that gives the voter confirmation that his/her voted mail ballot was received by the Elections Office.

On Election night, Chief Election Officer Warren Slocum will host a celebration for anyone interested in gathering to watch the election night returns as they are reported. Join community leaders, citizens and elected officials and share in an old-fashioned evening of election returns. All are welcome.

The Election Night gathering will be held at the Rotunda at 555 County Center in Redwood City starting at 7:30 p.m.

Election night returns will be issued at 8:05 p.m. and on the half-hour for the rest of the evening until the count is completed. The results will be issued in person and on the Elections website according to the following schedule:
Vote by Mail Ballot Results         8:05 p.m.
All-Mail Ballot Precinct Results    8:30 p.m.
Early Voting Center Results        9:00 p.m.
Live Precinct Results                  9:30 p.m.
Live Precinct Results                10:00 p.m.
Live Precinct Results                10:30 p.m.
Live Precinct Results                11:00 p.m.
Live Precinct Results                11:30 p.m.

Interim reports will be issued until all the precinct votes have been counted.

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The New HVCC Law – Does It Help, or Just Plain Suck?

aretheyinsanelgSo there’s this new law affecting the real estate and mortgage industry, called the HVCC – short for “Home Valuation Code of Conduct”, which went into effect last month, and is the byproduct of a legal settlement between NY attorney general Andrew Cuomo and Fannie Mae & Freddie Mac.

Here’s how it was “supposed” to help: to assure appraisers that they would not be unduly influenced by lenders in the appraisal process.

Here’s where it proverbially, “sucks”: costs rose, and accuracy in appraisals took a nosedive. Moreover, appraisers that are unfamiliar with local markets, inexperienced or both, are using distressed sales – foreclosures and short sales of existing houses – as their comparables

Kenneth Harney from the Washington Post (in my opinion, probably the best columnist covering real estate issues, bar none), wrote a great article recently(full contents here, but I’ll quote some of the highlights below).

How it can affect everyone:

It could directly affect the value of your house – probably negatively – by tens of thousands of dollars

The issue concerns low valuations and the new rules guiding appraisers in both price-depressed and rebounding markets. Consider these snapshots of what’s going on:

  • In San Diego, Steve Doyle, division president for Brookfield Homes, is trying to close out the final 20 houses of a 120-unit single-family subdivision. Prices range from $340,000 to $350,000. But recently there’s been a major hitch: Appraisers assigned by banks are coming in with valuations $60,000 or more below Doyle’s selling prices. The appraisers, who Doyle says are unfamiliar with local markets, inexperienced or both, are using distressed sales – foreclosures and short sales of existing houses – as their comparables. Some of the distressed properties are in poor condition, and all of them offer fewer amenities, according to Doyle.
  • In Wilmington, N.C., a loan applicant with a house in excellent condition, and an unblemished payment record, sought to refinance into a 4 3/4 percent mortgage. She had purchased the property four years ago for $160,000 and made about $20,000 worth of improvements in the interim. Her loan application, according to Paul Skeens, president of Colonial Mortgage Group of Waldorf, Md., was “a slam dunk. Nothing to it.” The house was worth $180,000 to $200,000, according to one estimate.

But when an appraiser with little local knowledge was sent in by a bank to value the house, he chose two short-sale properties that had both closed in the mid-$140,000 range, and one inheritance sale around $155,000. The last property was “in horrible condition,” said Skeens. “I’d call it dog meat.” The deal-paralyzing appraised value that came in for the cream-puff refi: $149,000.

Complaints about lowballed appraisals – from builders, realty agents, consumers and mortgage companies – have erupted since May 1, when government-sponsored Fannie Mae and Freddie Mac put their new appraisal rules into effect nationwide. Critics charge that the new system is fostering the use of appraisers willing to work for low fees – sometimes 50 percent below previous standards – and who are willing to conduct home appraisals far outside their typical areas of activity.

Under the HVCC, appraisers are now routinely assigned by appraisal management companies rather than being selected by mortgage companies or loan officers. The management companies pocket as much as 40 to 50 percent of the appraisal fee.

Frustration with the new system boiled over and made its way to Capitol Hill late last month. The National Association of Home Builders called for an immediate change in the rules governing the use of foreclosures, short sales and other distress transactions as comparables for appraisals on non-distressed, typical homes, whether new or resale.

Two congressmen – Travis Childers, D-Miss., and Gary Miller, R-Diamond Bar (Los Angeles County) – have introduced legislation calling for an 18-month moratorium on the appraisal code. In identical letters to James Lockhart, the top regulator of Fannie Mae and Freddie Mac, and Cuomo, the National Association of Realtors also requested a moratorium and complained that the code is raising costs to borrowers, distorting property values and killing sales.

Asked for comment, Lockhart said through a spokesperson that his agency is monitoring the situation, and considers “the views of market participants important.”

Bottom line: Be aware of the issue. It affects your equity, even if you’re not buying or selling. And watch to see whether Congress fixes the problem.

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Schedule of 4th o’ July Activities for Redwood City

(straight from the city’s Public Communications Manager Malcolm Smith)

This year’s 4th of July spectacular, brought to you by the Peninsula Celebration Association, will be another in the long tradition of offering the very best 4th of July event on the peninsula. All the details are at www.parade.org, the home page of the non-profit Peninsula Celebration Association. The Peninsula Celebration Association has been in place for nearly 70 years with a goal of helping to make our city not just a great place to live, but also a real community of people who care.

Visit www.parade.org for the entire schedule of family fun on the 4th of July in Redwood City.

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A Dying Breed: Paying Over $1M for a Mt. Carmel Home

dodoIt seems like just yesterday – ok, maybe 2 or 3 years ago – when a new listing in Mt. Carmel that came on the market with a price tag higher than $1M didn’t raise an eyebrow. Heck, there were even some bordering close to $2M that I thought “well, if someone’s willing to pay that much, then that must be what it’s worth.”

Of course, these are wildly, WILDLY different times now in real estate. That shouldn’t come as a shock to anyone, right?  Well, as experts in what we do, many of us Realtors can quickly and generally assess a home’s list price relative to its neighborhood and say, “yes that’s priced well”, or “what the hell is the color of the sky on THEIR planet?”, or “what are they smoking in their pipe?”  You get the idea.

I’m talking now, of something that seems to be getting more extinct than journalistic integrity in real estate reporting (oops! Did I just say that out LOUD?), and that is, paying over $1M for a home in the Mt. Carmel area.

Let’s do a quick look at the numbers: out of the 16 homes that have sold in Mt. Carmel in the last 6 months, only one of them sold for over the elusive $1M price tag (that would be 263 Iris, for $1.238M, which, incidentally, was one heck of a gorgeous home).

And out of the 17 homes currently active for sale, 8 of them are priced at over $1M.  A few of those have been on the market for 361 days, 259 days, 116 days, and 98 days.

Now this absolutely is not saying that any of these homes currently on the market is not worth its asking price.  As I always say, the value of your home is whatever a buyer is willing to pay you (and for you to accept). If you’re a seller, then this blog post and this one are MUST READS.

And what I also say is that if your home is on a busy street, and you want to sell it in under 1 year, do NOT price it as if it were set further in on a neighboring, non-busy street.  It’s a pretty rare breed of buyer that wants to buy a $1M+ home on a busy street, especially if they have children.  An even rarer bird is the buyer who will pay over $2M to live on a busy street – I just seem to think, if it were me and I were spending over $2M on a home, I’d be more inclined to look in, oh, Emerald Hills, Woodside, Portola Valley, Los Altos, San Carlos hills…but that’s just me, what the heck do I know about what buyers want (rhetorical sarcasm…don’t answer that!).

Time will always tell what these homes eventually will sell for.  Timing is everything – if you were fortunate enough to sell a home 3 years ago for a price that no one would touch in today’s market, you may be more lucky than anything else.

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