We Are Yo-Yo’s
September retail sales rose sharply, buyers lined up at Apple stores for the iPhone 4S, Google issued a stellar earnings report, the US stock market popped back up  –  one analyst was quoted as saying: “Recent economic data reinforces our belief that the U.S. economy is not in a recession. The consumer is in fact coming back and starting to spend.”  Then the stock market went down again on some more bad news from Europe, and we’re back to feeling like yo-yo’s.

Our Own Little World…or Bubble
And, while clearly we’d be wise to remain cautious in our optimism, and conservative in our financial decision-making, and, while a lot still hinges on what American and European leaders do/don’t do next, some of the good news is actually most meaningful for– in fact, emanating from — the Bay Area.   As usual,  I am seeing the positive impact of San Francisco’s diverse and strong economy on our unique real estate market.  We’re not close to pre- 2008 levels, but having Facebook, Google, Apple, Twitter, Genentech, and all of the other strong bio tech and high tech companies’ employees  here, vying to live in our city is a huge boon to our local market.  These people would rather live in San Francisco near Noe Valley’s Apple/Facebook/Google work-shuttle hub, than in the actual towns those companies are located in — just outside of San Francisco.  Let’s just say, there’s a lot of cash floating around here.

And, a recent San Francisco Chronicle article reports that despite a scary national unemployment rate, certain cities are in fact hiring, with San Francisco winding up second on a list of top ten metropolitan areas adding jobs. It notes positive trends for the city in management, information technology, architecture, and engineering among other endeavors.

Silicon Valley Express
And, that cash is making its mark: SF’s District 5, home to the Noe Valley neighborhood — where you can catch a shuttle to top Silicon Valley companies, or be on the freeway in just minutes that will also take you to Silicon Valley– has continued to experience healthy sales activity.  Since September 2010, the number of homes under contract in the district has risen by 10.3 percent, while the number of homes sold has increased by 35.3 percent.  In Noe Valley specifically, comparing Q3 of 2010 to Q3 2011, the average sales price of a home has risen more than 10%.  And, Noe appears to be gaining back some of it’s Great Recession losses — in Q3 of this year the average sales price of a home in Noe now is only 4% off off of it’s 2007 high.

Active Buyers, But There’s Nothing to Buy
Also, SF’s inventory of for sale homes is still quite low, creating some leverage for sellers. For properties priced below $700,000, the months of supply inventory dropped by 38.7 percent, compared with last year, to a reading of 2.5 months. For properties priced between $700,000 and $1.2 million, the months of supply inventory fell by 26.9 percent, compared with last year, also to 2.5 months. Supply of less than three months normally indicates a seller’s market where, due to the lack of inventory, sellers have more negotiating leverage.  And, the market is bearing that out.  Even though the number of single-family homes for sale has decreased since September 2010 by 16.1 percent citywide, the number of single-family homes under contract in September rose by 13.9 percent, while the number of homes sold also increased by 5.7 percent.

Of course people can still opt to rent, but San Francisco was just reported as having the nation’s second-largest increase in apartment rents last quarter, at 4.5 percent.   I know of a two-bedroom place that a Facebook engineer snagged over other bidders for close to $4,000/mo.  It’s become a landlord’s market for sure.

Money Is Cheap — But Try Getting a Loan
I just refinanced again — down to 4% with no closing costs, no fees whatsover.  Obviously if you have the equity and the wherewithal to refinance, now is the time.  Don’t be shocked when your appraisal comes in lower than what you know you can sell your home for. Banks are doing all they can to cover their own butts. If they do the math, and find you have some extra cash lying around, they will only give you value on what is absolutely necessary.

This isn’t only the case for refinances.  If you are in a purchase, and the bank puts it together that you can put more money down — don’t be surprised if there is suddenly a problem with the appraisal, or some technicality that holds up your loan approval.  It’s the bank trying to squeeze more money from you!

Rates are on a roller coaster because of the market uncertainty — but still at an all time low.

On October 1, the conforming loan limit decreased, and the U.S. stopped guaranteeing loans larger than $625,500 (reduced from $729,750 in SF).  Since the average price of a home in most neighborhoods here is close to a million, it just got a bit more difficult and expensive for folks to buy. The following information indicates the city/county, percent affected, previous loan limit, and new loan limit.

San Francisco/CA, 11 percent, $729,750, $625,500; San Mateo/CA, 8.5 percent, $729,750, $625,500; Arlington/VA, 8.3 percent, $729,750, $625,500; Santa Clara/CA, 6.2 percent, $729,750, $625,500; Washington/DC, 5.7 percent, $729,750, $625,500; San Diego/CA, 5 percent, $697,500, $546,250; Orange/CA, 4.5 percent, $729,750, $625,500; Fairfax City and County/VA, 4.4 percent, $729,750, $625,500; Suffolk/VA, 4.3 percent, $523,750, $465,750; King/WA, 3.9 percent; $567,500, $506,000; Los Angeles/CA, 3.1 percent; $729,750, $625,500; Queens/NY, 2.1 percent, $729,750, $625,500; Sacramento/CA 0.7 percent, $580,000, $474,950; Baltimore City/MD, 0.7 percent; $560,000, $494,500; Multnomah/OR, 0.1 percent, $418,750, $417,000.

Giving Thanks
I am so thankful for my amazing clients and friends.  You are constantly sending people my way and therefore my business is almost 100% based on recommendation and word of mouth– that’s pretty incredible.  Thank you for all of your faith in me and know that I will continue to be someone who will go above and beyond for you and the people you send my way.

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up.  If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call.  I’ll continue to keep you updated.

Happy Fall,

Jessica

Welcome to my quarterly (Q2 2011) San Francisco real estate update.  Here’s where I keep you posted on the SF market (stats below), and also remind you that I — someone you know and trust — am here to help you and yours with any real estate need!  I continue to place in the top 1-2% of San Francisco Realtors.  Let me put my expertise to work for you, your friends and family!

ROUGH SEAS
The numbers confirm it — the economy slowed down again in the 1st half of this year.  Fuel prices skyrocketed, the stock market tanked, hiring was sluggish — Japan, Greece, the weather.  Another perfect storm.  Economists were whispering the horrific phrase “Double Dip” again.

Then at the start of a new quarter this July, things looked slightly better again: the Dow goes back up, the lowest level of new jobless claims filed in three months, steepest drop in energy prices in more than three years, etc…

Is anyone else starting to feel seasick?

Thankfully talk of a Double Dip talk has started to dissipate again.  Economists are forecasting a pick-up in growth in the second half of the year.  Federal Reserve Chairman Ben Bernanke told Congress on Wednesday that temporary factors, such as high gas prices and supply chain disruptions caused by the Japan crises, have slowed the economy and that they should begin to fade and the economy should grow at a faster pace in the second half of this year. But if not, he said the central bank is prepared to do more to stimulate growth.

Again, with the seasickness.

SF PRICES GOING UP… SLOWLY
The San Francisco housing market has been at the head of every one of the economic trends. SF home sales were sluggish in the first half, and then rose sharply last month (14.5%) from May to the highest level for any month since June 2010, when outgoing homebuyer tax credits gave housing demand a final boost.  Now that things look like they might be OK again, buyers have jumped back into this market — taking advantage of incredibly low interest rates and avoiding the city’s increasing rents.

The numbers show that sales prices in key districts like 5 (Noe Valley, Cole Valley, Dolores Heights, etc), 6 (Lower Pacific Heights, NOPA, Alamo Square, etc) and 9 (Mission, Bernal Heights, Potrero, SOMA, etc) are slightly up the 1st half of 2011 compared with the 1st half of last year.

TRADING UP IS (STILL) HARD TO DO
Inventory in the city is still so very low.  It’s an odd mix of homes that have been on the market for months, which today’s frugal and somewhat insecure buyers don’t want to touch (until somebody else does), AND well-staged, well-priced homes that fly off the MLS in multiple offers.  It’s so interesting… in a few deals this year, my brave clients would put an offer in on a property that had been on the market for quite a while (a couple months at least) only to find themselves in competition with other buyers who suddenly wanted the home now that someone else did, too.

My clients who want to sell their homes are still concerned they won’t find that perfect home to trade into — thanks to the lack of inventory — and so are finding themselves renting while they sell, or living in their home while it’s for sale (never fun!).  However, when there’s not much to be excited about for sellers, the lack of inventory certainly is a boon for well priced, well-prepared homes on the market now.

THE ANATOMY OF AN APPRAISAL
The banks are still a HUGE barrier to the market.  I had three appraisal issues (where the homes appraised far lower than my clients’ offer price) in the last six months — *never* had an appraisal issue or heard of one prior to 2008.  Get this: the first appraisals came in at $75K-$50K lower than the offer price!  That’s huge.  Basically deal killing.  In two of the cases my clients pulled their loan and went to another bank where, drum roll please… the homes appraised at value — had no issue appraising.  HOW can two appraisals, within a couple of weeks of each other be SO different?  I am pushing for a New York Times piece (by Alexei Oreskovic or Gretchen Morgenson perhaps?) entitled “The Anatomy of an Appraisal” where the author compares the 1st and 2nd appraisals, and through in-depth reporting finds the real reason behind the faulty appraisal process.  Whatever the reason: banks are being stingy with their money, and they’re making buying a home as difficult as possible.

If you are a seller you must be prepared to support the sales price you desire with comparable sales from within 2-3 months.  For buyers: the inexperienced, unmotivated appraiser doesn’t know how to weigh bonus space.  If you’re buying a home with wonderful but unwarranted space, you might expect an appraisal hiccup.  It’s all part of a transitioning market,

MONEY IS (STILL) CHEAP
Depending upon your specific situation, today’s rates are in the high 4’s to low 5’s for a 30 year fixed loan, and in the low 3’s for a 5/1 and 7/1 ARM loan.  It’s a great time to look at your overall financial health and look for ways to take advantage of these rates.

For jumbo loans (loan amounts over $729,750) rates are again at an all time low.  You can put as little as 20% down up to 2.0 million dollars which is very aggressive for the market. There are loans in the low to mid 5’s for a 30 year fixed up to that amount as well. If you’re in the market for a jumbo loan – now is the time.

You should be able to take advantage of the jumbo rates on $729,750 up to September 30th.  Then the jumbo limit will change back down to $629,000.

BLESSED
I have such great clients, and they are always so appreciative of what I do.  I think they know how hard I work, and that I manage their details and think through their challenges as I would for myself or my own family members.  It is shaping up to be another strong year, and I have all of you to thank for my continued success.

“Jessica – your knowledge of the market, of what to do at every stage, how on top of things you are — made us money and saved us time — but most of all we could sleep peacefully knowing you were handling everything.  We recommend you without hesitation to anyone looking for an intelligent, highly competent and experienced agent.”
Q2 Clients

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up.  If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call.   I’ll continue to keep you updated.

Thank you for your continued support & HAPPY SUMMER!

Jessica

Welcome to my quarterly (Q1 2011) San Francisco real estate update.  Here’s where I keep you posted on the SF market (stats below), and also remind you that I — someone you know and trust — am here to help you and yours with any real estate need!  I finished 2010 in the Top 1% of agents citywide. I also made it into Alain Pinel’s President’s Roundtable for Exceptional Performance, helping place the company as number six in the nation.  Our Noe Valley office is definitely taking the city by storm. Let me put my expertise to work for you, your friends and family!

TWO STEPS BACK
The WSJ today said late last week “The U.S. economy hit the brakes in the first three months of the year as higher prices, especially for gasoline and food, squeezed consumer spending, and government purchases dropped the most in three decades.”   The NY Times reported today: “The economy lost steam in the first quarter. Growth in personal consumption — the single largest component of the economy — slowed markedly. Business-related construction cratered and residential construction fell. Exports stumbled. The only unambiguous plus was continued business investment in equipment and software, which is necessary but not sufficient for overall growth. In all, economic growth slowed from an annual rate of 3.1 percent in the fourth quarter of 2010 to 1.8 percent in the first quarter of 2011.”

This was interesting to read because the first three months of the year in SF real estate seemed eerily dead. There was little inventory, and most of the inventory there was seemed, in general, to be mis-priced, and/or problematic.  I saw plenty of active buyers — eager to take advantage of historically low interest rates and low prices.  But, for the most part, the sellers just weren’t there.

NO SENSE OF URGENCY
My take is that almost everyone who had to sell (lost job, interest rate adjustment on mortgage, etc) as a result of the “economic downturn” already sold in ’09 or ’10.  2011 sellers are not as much under the gun, and can take their time to consider exactly what they want, and how and when to get it.  That lack of urgency created a slow start to SF’s Q1 real estate market.  Sellers understand they might take a bit of a hit selling low (depending on when they bought) but feel they’ll make that up in buying low.  Only problem is, there’s not much to buy.  So they wait…

Many of my clients considering trading up are in a catch 22: they don’t want to put their house on the market until they see something great to buy, but there isn’t anything great to buy because sellers won’t put their house on the market until they see something great to buy… and so on.  So we’re at a bit of an impasse.  Slowly but surely inventory is starting to pick up, as there is no denying that this is exactly the right market for trading up.

HINT: UNBELIEVABLE UNITS
Right now, one of the the best investments in SF real estate by far is 2-4 unit buildings.  If you can stomach being a SF landlord, or have a partner to go in on a condo conversion with, there are many great deals to be had on multi-unit properties.  I ran some numbers comparing 2008 sales of 2-unit buildings with that of 2010 in five key neighborhoods — Noe Valley, Mission, Dolores Heights, Nopa.  In 2010 these buildings are, on average, more than 25% less expensive than they were 2 years prior.  I have seen buildings that would have sold for $1.7 in 2008 sell for $1.3 in 2010.  Part of the reason for this is it’s much more difficult today to qualify for a loan on a multi-unit property: you need at least 25-30% down typically, and good cash reserves. And, there are simply less investors in this market.  There is opportunity here.

NO MUMBO JUMBO
More changes to come for loans…. FNMA has made some noise about reducing the high balance conforming loan limit from $729,750 back down to $625K around September / October of this year. What does this mean for you?   When this takes effect, it could potentially mean higher interest rates, looking at a different loan structures, or coming up with a larger down payment to get the rate you want.  No matter what happens with this potential loan limit change, rates are still at a 40 year low. In a healthy economy rates are typically in the mid 6’s. It’s just a matter of time before rates rise again to more normal and higher levels.

Depending upon your specific situation, today’s rates are in the high 4’s to low 5’s for a 30 year fixed loan, and in the low 3’s for a 5/1 and 7/1 ARM loan.  It’s a great time to look at your overall financial health and look for ways to take advantage of these rates.  I refinanced into a shockingly low 30 year fixed mortgage at the start of the year — if you can handle the bureaucracy and the wait, I know a mortgage broker with great (in some cases no closing cost) rates for non-jumbo loans.  A client tipped me off, and I have since referred many.

For jumbo loans (loan amounts over $729,750) rates are again at an all time low.  Today jumbo interest rates fell to a level that I have not seen in over a year.  B of A is allowing as little as 20% down up to 2.0 million dollars which is very aggressive for the market. The bank is also offering loans in the low to mid 5’s for a 30 year fixed up to that amount as well. If you’re in the market for a jumbo loan – now is the time.

FROM MY CLIENTS
“Well done! Thanks for all the hard work…. we truly appreciate your determination and patience.”
-Q1 Sellers
—
As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up.  If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call.   I’ll continue to keep you updated.

Thank you for your continued support & HAPPY SPRING!

Jessica

Hi Everyone,

Welcome to my quarterly (Q2 2010) San Francisco real estate update.  Here’s where I keep you posted on the SF market (stats below), and also remind you that I (someone you know and trust) am here to help you and yours with any real estate need!  I am among San Francisco’s Top 100 Realtors, I am #1 or #2 in my neighborhood depending on the week, and am ready to put my expertise to work for you.

FACING HEADWINDS
In Q1 of this year we began to crawl out from under the wreckage of 2008 & 2009.  The message from Q2 2010 is we’re not out of the woods yet.  The Dow remains volatile, the home buyer’s tax credit expired, and doubts about Europe’s economy increased. As President Obama puts it, our economy is recovering but “facing headwinds.”  The economy is definitely still going through ups and downs, trying to regain its footing.

The housing market appears to be improving somewhat, but, like the economy as a whole, it’s a slog.  According to one housing market analyst: “The housing glut and foreclosures will drive the national Case-Shiller index (S&P/Case-Shiller Home Price Index of 20 major housing markets) down another 6% to 8%, with [housing] prices bottoming in 2011.”

What can I say?  Lenders and appraisals have been a section in each of my newsletters for the past year or two.  The banks are squeezing everyone.  Borrowers, appraisers…  In most of the transactions I see, where loans are involved, the lender manages to throw a wrench in somewhere — at the appraisal stage taking $ off the value that just doesn’t make sense, asking for documentation that slows the process down, etc.  It is the nature of the beast right now.  Realtors have to stay on top of the process, the mortgage broker absolutely matters, and sellers and buyers expectations must be adjusted to allow for some lending hiccups.

GET IT WHILE YOU CAN
Rates are really low.  Depending on the specific buyer and situation – Purchase and loan amount up to $729,750 30 year fixed Rates as low as 4.75% @ 0 points; 5/1 ARM  3.625% @ 0 points.  For jumbo purchases (loan amounts over $729,750) 30 year fixed rates as low as 5.375% @ 0 points; 5/1 io  4.375% @ 0 points. Rates subject to change daily depending on the market. Refi rates are about .125% higher.  (Source: Lorianne DaLuz with Bank of America SF).

FROM A Q2 CLIENT
Here’s an email I received from a client whose single family home sold very swiftly this June — 3 offers in less than a week:  ”Well done, Jessica! Thank you again for your fine work. (As our next door neighbor said: “congrats for the fastest sale known to man”).
—

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up.  If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call.   I’ll continue to keep you updated.  Thank you for your continued support & HAPPY SUMMER!

–Jessica Branson

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Welcome to my quarterly (Q4 2009 and Q1 2010) San Francisco real estate update.  Here’s where I keep you posted on the SF market (stats below), and also remind you that I (someone you know and trust) am here to help you and yours with any real estate need!
ME OH MY… Before we get to the good stuff, I wanted to update you all briefly on my life in real estate.  Surprisingly, and unlike many of my colleagues, last year was the best year of my career!  I ended among the Top Realtors in San Francisco (there are thousands of them BTW) and am currently among the Top 50 in SF for 2010.  I revamped and re-launched my website www.JessicaBranson.com (with the help of redbirdfly.com — a cool Web design firm comprised of clients and friends, and www.JonathanJames.us photographer extraordinaire), and hired a full time assistant (who is so bright, he will no doubt outgrow working for me very soon!).  In short, 2009 was a year of incredible growth for me in SF real estate.  I am looking forward to more good years to come, and I thank my amazing network of friends, family and clients for recommending me to all who will listen!  Thank you.

SEIZE THE DAY

One of the most pressing questions I always get from clients who plan to sell is: “When should I put my house on the market.”  Unless we’re talking about the only bad months to sell in SF (August, Nov, Dec), my answer right now is: Now — if you want to trade up, downsize or relocate.  Prices are stabilizing (good for you if you’re buying after selling), inventory is low, and buyers have realized it’s a good time to buy.  If you can prepare your house well to sell, and can be realistic about the price, the time is now.

However, I have different advice for sellers who can afford to wait, who are not trading up to a better home/relocating, or who have little or no equity:  For you, now might not be the time. Our market is fickle and very property specific right now.  We are only *just* coming out of this recession – things will most likely get a bit better in a year or so? (even if they ultimately get a little worse – with inflation/higher interest rates). If you have no compelling reason to sell right now, then why would you?

Alan Greenspan on a morning news program the other day said the last two months have convinced him that we are not going to have another “dip” connected to this recession.  But then wasn’t it he who also said a while back that he thought the financial markets could regulate themselves…  Most economists say the worst is behind us, but that it’s not going to be easy.  I tend to agree with that sentiment. There will be up and down blips in our market, but overall it is stabilizing.

THE SWEET SPOT

While SF’s market looks to be stabilizing — it is by no means shooting up.  If you look at the stats for Q12010 vs Q12009 in most neighborhoods, prices have gone up a bit, and some have even declined a bit.  And, I imagine this stabilization will be the norm for quite a while.  The hottest price point is still for properties below $1M.  Homes in the $700-$900K if they are well priced and well prepared typically receive multiple offers and go for over the asking price.  And, even though price per sq ft is becoming a favorite yard stick for the SF real estate buyer, we’re seeing those instances, hearkening back to the pre-recession days, where caution is tossed aside, and buyers bid what it will take to get the right house in the right location.  Most properties I listed in the beginning of the year sold quickly and/or in multiple offers, and most for more than the average price per sq ft in the neighborhood.

Even the best homes, over $1M are moving more slowly in general -and they are fewer and far between. Occasionally you’ll find the under-priced one that buyers pounce upon, or the one that people just fall in love with (my listing at www.110Elsie.com earlier this year was that sexy kind of house) and it goes like that!  But for the most part, homes between $1.1 -$1.5 are moving more slowly.  Buyers are a little confused and hamstrung… — neighborhoods that used to be out of reach, now seem reachable, yet with many compromises.  Money is harder to come by these days — both for the 20% + down payment and to qualify for the loan.  It’s hard to gauge what to pay when the market (and the economy) is in transition.  Also, cash is king.

Properties between $2M-$3M are moving but they are typically go for well below their initial asking price.  There is a lot of barter at this price point, but potentially a lot more room for barter…

REAPPRIASAL

Unfortunately lending is still a huge barrier to our market recovery.  If you can come up with 20% down, get approved for a loan, jump through all the hoops lenders now require, you’re not home yet.  Appraisers are coming in and killing deals.  It doesn’t matter that you have an offer for $2M on your 2-unit building, for instance, if the only 2-unit buildings that have sold in your neighborhood in the last 6 mos sold for $1.2 and $1.5.  Your property will not appraise.  If there are not comparable properties to support the sale, you may not have a sale.  The more money a buyer has down, the less reliant they are on the appraisal.  This is another reason cash is king right now.

GET IT WHILE YOU CAN

From Lorianne DaLuz SVP/Mortgage Broker, Bank of America, lorianne.daluz@bankofamerica.com California 1^st time home buyers can claim state tax breaks up to $10,000.00 starting May 1st 2010 until Dec 31st 2010.  I say up to $10K because it’s up 5% of the purchase price but a maximum of $10,000 which is all of San Francisco.  You will get $3333.33 over a 3 year period.   Unlike the federal tax credit this does not have income limitations.  (Please always check with your tax advisor for details and more information)

Rates are still at historic 38 year lows but we anticipate rates will rise this year. Right now conforming rates are in the very low 5’s and jumbo over 1.0 mil around 5.625%. It is not a matter of if rates will go up but when.  It’s anyone’s guess, but mine is that rates will hit at least 6.0 for conforming and mid 6’s for jumbo loans.

FROM A Q1 CLIENT 

I just got a lovely handwritten card from a wonderful client after selling her 2-unit building last month.  Here’s a snippet of what she wrote:  ”Words really do not cover how much I appreciate your professionalism and support …Knowing you were covering all the bases and looking after my best interests helped ease this transition. Thank you so much!” —
As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up.  If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call.   I’ll continue to keep you updated.  Thank you for your continued support & HAPPY SPRING!

Jessica

San Francisco: First Quarter 2009-2010 Comparative Analysis of Select Neighborhoods

Welcome to my quarterly San Francisco real estate update (Q3 2009). Here’s where I keep you posted on the SF market (stats below), and also remind you that I (someone you know and trust) am here to help you and yours with any real estate need!

As predicted, the second half of 2009 is seeing a slight recovery from the economic crisis that hit full force just more than a year ago. Although the 100th US bank just failed last month, unemployment just reached 10.2%, and we’re racking up tremendous debts as a nation, –still the DOW is hovering around 10,000, layoffs appear to be moderating, the GDP has reported slight growth for the first time in a year, the US housing market is improving, and the headlines are more confident…

Here in San Francisco, the real estate market is definitely getting stronger.

You’ll note from the stats that the condo market is still weaker than the single family home market. On the other hand, realtors are adjusting to the market and getting better at pricing, so even though the number of days a property spends on the market (DOM) may have gone up in a neighborhood vs. last year at this time, the overall DOM is going down overall. Also, there are things the stats cannot tell us that we can only get from being in the trenches… I am touring properties on brokers tour every Tuesday, have sold more properties this year than I ever have before, and I am feeling the market strengthening. Listing prices that I would not have supported a year ago – I am now willing to try because of the strong buyer demand and higher level of market confidence.

VALUES AMAZE
I think it will be a long time before we again see the kind of deals that are out there right now. I am consistently amazed when I walk in to a home that would have been $200-$300K more just 1-2 years ago. Now that the market is getting stronger, though, these incredible values are receiving multiple offers and being snapped up – sometimes within days of being listed. The last two properties I sold this quarter both received multiple offers less than a week after going on the market. One went for $50K over the asking price, the other close to $15K over, but still — their final sales prices were less than they would have been before the crash (BC).

If you are looking for a good place to live for the next 5-10 years, now is a really good time to buy.

The best deals here are in the The $1.2M-$1.5M price point, which is having a slower recovery. You can find gorgeous remodeled 3 and 4 bedroom homes in highly desirable neighborhoods in the $1.2 range — previously, in the same neighborhoods, this price range would have been reserved for small homes or fixers. If you can go upwards of this, there are some even better deals.

I have already seen the under $1M price point level off. Places that I sold earlier this year in the $700K-850K range would now be gone in a moment, or simply priced higher. There are a ton of first time buyers out there whose confidence has been gaining, who are well-qualified for 20% down loans (and in some cases with much, much more down), looking to nab a home before prices go up. If your SF property is well prepared and well-priced in this price point, you should have a swift sale.

OMG THE CYA!
The banks are working against this recovery in a way, to cover their butts. They had closed their eyes to predatory lending practices, took their profits, and contributed hugely to this last economic crisis. Now, after paying out big bonuses, and taking government money, they’re swinging the pendulum to the opposite extreme- and making it very difficult even for qualified buyers to get a loan. Here appraisals have become the largest barrier — even where a purchase price is clearly justified by current sales, appraisers are finding ways to deduct value, and for the first time in many years appraisals are regularly coming in under value. Could appraisers be rewarded somehow by banks for denying value?…

Mortgage brokers can no longer speak directly with appraisers due to new lending rules — even when the appraisal reports are factually wrong. And, due to the new rules appraisers do not have to have any knowledge of the specific market of the subject properties they review. So, you may have an appraiser from San Jose (where say the avg sale price of a home in the $400K’s and most is new construction) appraising a 100+ year old home in San Francisco where the average price of a home is twice as much. It is not a pretty picture. Beware that for both buyers and sellers the appraisal may be your biggest barrier to the sale. Realtors need to work with the appraiser showing comparable sales and make sure the important features of the home are showcased.

FHA loans that sometimes require two appraisals, and banks that use out of area appraisers can slow down your sale. In addition, it unfortunately appears that lenders are squeezing the mortgage brokers – maybe a punishment for falsifying loan apps & etc — I have found that independent mortgage brokers have a hard time getting the best rates and closing loans on new home purchases. It’s the direct lenders –brokers from Wells, BofA for instance, — who wield the power right now.

A TOE IN THE WATER
There was a time last year and in the first part of this year when homeowners were only selling when they utterly had to (job loss, job transfer, divorce, etc.). Now, there are more folks finding that it’s a good time to trade up — sellers who bought 3 years ago or more are for the most part still taking healthy profits — and potentially an OK time to make the move that’s been put on hold by previously declining market. This will impact the quality of inventory we see on the market, which is consistently getting better and better.

STILL GOOD FOR BORROWERS
Interest rates are still at an all time low. The latest from Bank of America: depending upon your individual situation rates can be as low as …..417K 5.125% @ 0 pts and 4.875% @ 1.0; agency jumbo $417K up to $729.750 5.25% @ 0 pts and 5.0 @1pt. Jumbo 30 year fixed 5.875% @ 0pts and 5.625% @ 1pt and the 5/1 ARM 5.375% @ 0 and 5.125% @ 1.0– All loans have NO PREPAY…

FROM A GREAT CLIENT
Jessica really is as good as it gets! She was our real estate agent for selling our second home and purchasing our third. And we will never use anyone else! We did all this during Spring and Summer 2009 which was a challenge. The climate for real estate as well as for mortgages was not friendly. Jessica was amazing throughout the ENTIRE process. She gave us great advice for preparing our home for sale and helped us to decide the most cost effective way to stage it. She has terrific contacts and we were thrilled with everyone she sent our way from painters to mortgage brokers. She has established friendly and respectful relationships with other realtors which really smooths the process out especially when there were bumps in the road such as delays from the lender for the buyers, etc. She gave us perspective and reassurance when we felt like panicking, but we never felt like she was insincere. The girl is honest to a fault!

We have two small children and Jessica was terrific with them. She understood their needs and what our needs were as a family. She helped us evaluate homes that we looked at from the perspective of a mother and a professional. It was a perfect combo!

Also, Jessica has a background in tech-business which gives her that edge. She is bright, used to being available by e-mail, text or phone at all hours and worked like crazy for us. After one open house on a rainy day we had 6 viable offers, all over asking price, but none more than 4% over. We knew the house had been priced and marketed perfectly. We ended up in a house that fits our needs to a T. We are forever grateful to Jessica, her expertise, her patience and guidance.
-Carrie H. 2009

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up. If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call. I’ll continue to keep you updated. Thank you for your continued support & HAPPY FALL!

Jessica

Welcome to my quarterly San Francisco real estate update (Q2 2009). Here’s where I keep you posted on the SF market (stats below), and also remind you that I (someone you know and trust) am here to help you and yours with any real estate need!

JUST BREATHE
Finally there is ray of hope… If you believe what you read in the media and hear from the pundits: The Recession Is Over (this was actually the title of the last issue of Newsweek: http://www.newsweek.com/id/208633). Unemployment numbers are still at a 26 year high and rising, BUT the number of job losses is declining. Average price of a home is still down 17% year over year, BUT that average home price has been steadily rising since May. In June, new home sales were up a whopping 11%, existing home sales have been on the rise for the last four months, and the DOW is now over 9,000. There really are finally some substantial signs that we are beginning to climb out of this mess. Next up: dealing with the recession’s repercussions…

STATE OF THE MARKET
But, before we get too far ahead of ourselves, let’s talk about now.
>>July 28, 2009 NY Times: Slide in Home Prices Is Slowing Down Indexes Show

http://www.nytimes.com/2009/07/29/business/economy/29housing.html?_r=1&emc=eta1

>>July 28, 2009 Reuters: US Home Prices See First Rise in Three Years

http://www.reuters.com/article/topNews/idUSTRE56R2WS20090728?feedType=nl&feedName=ustopnewsearly

And SF could be leading the charge out of the housing slump. Somehow the market here keeps on churning, even if it is a bit more mellow than in years past. From the stats below, you’ll notice in some neighborhoods the price losses are narrowing, and there are even some gains (Glen Park and Ashbury Heights single family home prices are both up quarter over quarter, as are condos in Russian Hill, NOPA, Eureka Valley, SOMA and the Marina). What I have noticed most of all is incredible deals… I am seeing really good homes in good neighborhoods for $100-$300K less than they would have sold for a year ago. There are also some great values in some well-priced new construction that seem to be rapidly selling out…

HIGH END MARKET IS ALIVE
As I last reported, the bottom end of the market found its bottom at the end of Q1. Now the top-end is beginning to follow suit. The $500-$700K range has been selling rapidly and steadily since April, as first time buyers take advantage of the great buys, the 1st time home buyers tax credit (which will be gone by year’s end), and all time low interest rates. The $800-$1M has also been busy, this is another 1st time buyer price point and also a trade up market (sellers moving from condos and smaller homes to bigger homes). But, now we’re beginning to see action in the $1.5M+ market, which is the true sign of life in our market. Now that the bleeding seems to be stopping at this price point, there is a better chance that the entire market will begin to stabilize.

SIGN OF THE TIMES
Everything is different now, though. The pendulum, once on the side of the borrower and mortgage broker, has now swung completely in the direction of the banks. Banks are being much more stringent — more money down, more control over appraisals, more scrutiny over the more thorough loan app. 30 day closes can now be more like 45 day closes. For the first time in a long time, we’re hearing of properties not appraising on new purchases. In SF this is partly because there is a new Chinese Wall between mortgage brokers and appraisers – and in some cases, appraisers are not even working in the same city as the homes they’re appraising. It is really important for buyers and sellers to investigate the inner workings of the loans they are presented with, as this could make or break the transaction. Also, it’s good to note that while FHA loans enable buyers with less than 10% down to purchase in this market, both buyers and sellers should know these loans can take *forever* to close, and the lenders can spring last minute surprises (requiring a second appraisal, etc.) that can impact the deal.

QUICK FACTS
*A very good time to buy: interest rates all-time low, home prices still down (though starting to stabilize), amazing deals
*For sellers who have equity, it’s a great time to think about trading up
*There is an active market for your home if it is both well-priced and well-prepared
*The last three homes I have listed sold in less than a week for between $30-50K over their asking prices

GOOD TIME FOR BORROWERS/REFIs
Interest rates are still at an all time low. FHA loans are still available now for folks who have a minimum of 5% to put down. These loans can take more time to close, and may have more hoops to jump through, but they can make home buying possible for buyers who don’t have 20% in the bank.It’s also a good time to refinance – again, if you have the equity you could turn your ARM into a 30 year fixed loan and potentially not change your monthly payments buy much.
….

This year I have already successfully managed multiple millions of dollars in sales through to successful completion since January, and have helped my many wonderful clients buy and sell some amazing homes!

Check out what my clients are saying about me on Yelp: http://www.yelp.com/biz/jessica-branson-san-francisco

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up. If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call. I’ll continue to keep you updated. Thank you for your continued support & ENJOY THE REST OF YOUR SUMMER!

Jessica

Welcome to my quarterly San Francisco real estate update (Q1 2009). Here’s where I keep you posted on the SF market (stats below), and also remind you that I (someone you know and trust) am here to help you and yours with any real estate need!

A lot has happened since my Q4 update in January. For one, SF’s real estate market plummeted. It continued its downward spiral from Q4, through January, February, March… Then, all of a sudden, about a month ago, the market here started to show signs of life again. Based on what I am seeing, I believe — dare I say it?? — SF’s real estate market is hitting/has reached its bottom. (Caveat: I would have to recant if the swine flu becomes a pandemic, the stock market drops another 50%, a terrorist attack strikes, etc – I never say never anymore!)

BUYERS ARE BACK
I first noticed a change in the market when, seemingly all at once, buyers in the $700K-$850K price range came back into the market with a vengeance in mid-March early April. People who had been on the fence for months, even years, suddenly had pre-approval letters in hand and were actively out seeing properties. Then, I had two listings in this “entry level” price point (yes, $700K-$850K is an entry level price point in San Francisco) in March and May that both received multiple offers (8 for one, and 6 for the other) for over the asking price.

Now, this so called “1st time buyer” price range is saturated with buyers who are armed with the same ammo: increasingly positive news reports about the economy, record-low interest rates, and dramatically low home prices. (Searched for the word “recession” on google news the other day and the first headline read: “Fed’s Yellen: Sees ‘Basis For Optimism’ About Economy).

The $1M-$1.5M price point is having a slower recovery, despite a slight recent uptick in activity. This is because of the new 20% loan down payment minimum ($200K in the bank to buy a million dollar home), and the lack of availability of bridge and home equity loans for people who want to “trade-up”, or buy a new home before having to sell their current one. So, as seen in the data below, neighborhoods with $1M+ average home prices (Noe, Potrero, etc) have been hit fairly badly…

THE “L” CURVE
Most economists say this recession will not make a “U” shaped recovery, like some recessions past, but will rather recover in an “L” shaped trajectory. Meaning, we will not see a sharp upward surge in growth when the economy begins to recover, instead, things will level out at the bottom and stay level for a while. Q1 numbers do indicate the dramatic, downward, vertical line of the “L”. What will really be telling is Q2, Q3 numbers, which, I believe, should show the beginnings of the horizontal line of the “L.”

BIG DROP IN Q1
No question, prices here are low now. Maybe as low as they’ll get. For the first time in 14 years San Francisco has experienced falling home values – and they fell even more in Q1. Realtors are completely thrown for a loop, which explains why home prices here are all over the map. The chart below that compares 2008 to Q1 2009 is especially telling: price drops from 2008 to Q109 are pretty dramatic for such a short period of time. (Noe is down 18% in Q109 vs 2008, Pacific Heights is down 15% for the same period)…

Certain property types and neighborhoods have been more heavily hit than others during this recession — why buy a condo when you can get a house? Why buy a TIC when you can get a condo? Why buy in the Mission when you can get Potrero? And the list goes on. Classic signs of a buyers market… However, the reality is that SF’s economy has remained relatively strong — most homeowners here don’t *need* to sell (as long as they’re not transferring jobs, don’t need a bigger home, etc), and so they will wait the market out until it better suits them. Now that the market is shifting, there is heightened competition for good properties.

Sellers who have enough equity are finding it’s a good time to trade up – if they have the wherewithall. If you can’t get a private loan or home equity line to buy before you sell, you may have to live in the home while showing it — but if the place is well prepared and well priced, it might move more quickly now than in previous months. You won’t get 2007 or 2008 prices for your home, but if you have owned for a while, in a good neighborhood and prepare/price your home well, you should do more than OK.

GOOD TIME FOR BORROWERS/REFIs
Interest rates are still at an all time low. The latest from Bank of America: depending upon your individual situation rates can be as low as …..417K 4.875% @ 0 pts and 4.5% @ 1.0; agency jumbo $417K up to $625,500 5.0% @ 0 pts and 4.625 @1pt. (729,250 –rolled out by 5/14); Jumbo 30 year fixed 5.875% @ 0pts and 5.625% @ 1pt and the 5/1 5.375% @ 0 and 5.125% @ .50 — All loans have NO PREPAY… FHA loans are also available now for folks who have a minimum of 5% to put down. These loans can take more time to close, and may have more hoops to jump through, but they can make home buying possible for buyers who don’t have 20% in the bank.

It’s also a good time to refinance – again, if you have the equity you could turn your ARM into a 30 year fixed loan and potentially not change your monthly payments buy much.

As always, please don’t hesitate to call with any real estate question, big or small, or just to catch up. If you want to know how much your place is worth in today’s market, recommendations for contractors, painters, gardeners, mortgage brokers, where to get the most bang for your buck in your remodel, and etc. give me a call. I’ll continue to keep you updated. Thank you for your continued support & HAPPY SPRING!

Jessica