Average 30-Year Mortgage Rate Drops Back Below 4 Percent
July 30, 2015

Having ticked up to 4.09 percent two weeks ago, the highest rate so far this year, the average rate for a 30-year mortgage has dropped to 3.98 percent, versus 4.12 percent at the same time last year, according to Freddie Mac’s latest Primary Mortgage Market Survey.

The 30-year rate, which hit an all-time low of 3.31 percent in November 2012, and a three-year high of 4.58 percent in August 2013, has averaged roughly 6.7 percent over the past twenty years.

The recent dip comes on the heels of a second big drop in Chinese stock prices and weaker than expected pending and new home sale reports, and an associated flight to quality which dropped Treasury yields around 5 basis points.

Articles and photos sourced from www.socketsite.com

Real Estate Roundup: Bay Area Buyers Willing to Pay Large Premiums for the Right Neighborhood
July 6, 2015 by Pacific Union • Posted in Weekly Real Estate News Roundups

Here’s a look at recent news of interest to homebuyers, home sellers, and the home-curious.

BAY AREA HOMEBUYERS PAY NEARLY 25 PERCENT MORE FOR TOP LOCATIONS
Bay Area buyers aren’t shy about paying extra for homes located in top school districts and close to desirable urban amenities, says a new study of data from the Journal of Urban Economics.

CityLab reports that behind residents of the Hawaii community of East Oahu, homebuyers in the Bay Area are more likely than those in nearly any other part of the country to pay extra money to purchase a property in a top-rated neighborhood. Although the article doesn’t provide exact numbers, it says that homebuyers in San Francisco, Marin, and San Mateo counties are willing to pay nearly 25 percent more than the average American to live in the best neighborhoods. The article notes that buyers in San Jose, Oakland, and Santa Cruz are also willing to spend significant premiums to purchase a property in a top community.

CityLab includes a map of the Bay Area that shows that, unlike in New York, homebuyers in virtually all parts of San Francisco will spend more money for a great neighborhood.

“People are very willing to pay for most neighborhoods in the city itself, as well as the surrounding suburbs,” wrote Richard Florida. “Only a few sections of Oakland and Richmond, to the north of Berkeley, rank lower on the quality of life index, but these still do well relative to the rest of the country.”

MILLENNIALS DON’T EARN NEARLY ENOUGH TO BUY A BAY AREA HOME
The Bay Area may be a magnet for young tech workers thanks to plentiful jobs, but only those with six-figure salaries can afford to purchase a home in the region’s two largest cities.

Using data from the U.S. Census Bureau, Zillow, and Bankrate.com, Bloomberg found that San Jose was the least affordable city in the country for millennial homebuyers. The average millennial worker in San Jose pulls in an annual salary of about $53,000, more than $80,000 less than what’s needed to afford a median-priced $924,825 home. San Francisco is the nation’s second toughest city for millennials, with about $110,000 required to purchase a median-priced $764,925 home. Bloomberg says millennials in San Francisco earn $49,000 per year.

While the millennial earnings gap wasn’t quite as large in other California cities, all of the five least affordable markets for young people were located in the Golden State, rounded out by Los Angeles, San Diego, and Sacramento.

SANTA CLARA PROPERTY VALUES CLIMB TO RECORD HIGH
Silicon Valley’s high-growth economy has propelled Santa Clara County’s residential and business property values to an all-time high, according to an article in the San Jose Mercury News.

Last week, Santa Clara County Assessor Larry Stone announced that the county’s property-assessment roll reached a milestone $409 billion. Stone said the region’s job growth has generated demand for housing, pushing both home prices and rents up. The article says that the median price of a Santa Clara County home was $810,000 in 2014, while the median monthly rent for a two-bedroom apartment reached $2,300.

While Stone said that home price gains were promising signs for Santa Clara homeowners who lost equity during the recession, they can soon expect larger property-tax bills.

“The residential real estate market has been so strong that some property owners will experience double-digit increases in their assessments,” Stone told the publication.

A BROADBAND CONNECTION CAN HEAVILY INFLUENCE A HOMEBUYER
Like a swimming pool or an extra bathroom, a broadband Internet connection can be a deciding factor for today’s home shopper on whether to make an offer or whether to keep looking.

Citing data from a study by the University of Colorado and Carnegie Mellon University, The Wall Street Journal reports that a fiber-optic broadband connection can add nearly $5,500 to the price of a $175,000 home, the same amount as a fireplace. According to the article, real estate professionals across the country are seeing an increasing number of buyers who won’t purchase a home without fast, reliable Internet service.

One Santa Barbara County man who spoke to the publication formerly owned a home on a street where Internet access was spotty. When he decided to sell, more than half of the 40 potential buyers walked away once they learned about the issue.

(Photo: Flickr/American Advisors Group)

Leasing Makes Solar Panels Affordable, But It Can Complicate a Home Sale

Leasing Makes Solar Panels Affordable, But It Can Complicate a Home Sale

March 27, 2015 by Pacific Union • Posted in Homeowner Tips

Rooftop solar panels continue to grow in popularity in the Bay Area, offering homeowners a “green” source of electricity as well as dramatically lower energy bills — and sometimes a surplus. In addition, a typical solar array can add $15,000 or more to the sales price of a home.

But there’s a catch.

Homeowners thinking about adding a solar array may be tempted to lease the panels instead of buying them. After all, purchasing a rooftop solar system can cost $15,000 or more after rebates. But while leasing can be an attractive option, it can complicate matters immensely when the owner puts the house up for sale.

Kenneth Harney, one of the nation’s most respected real estate writers, warned recently that leased solar panels can be a deal-killer.

Potential homebuyers may not want to take on a solar-panel lease contract in addition to a mortgage,Harney wrote in a recent column. A lease contract can run 10 to 15 years, and new buyers often have to qualify on credit from the solar companies themselves. In addition, some buyers may hesitate to sign a contract because they’re concerned that solar equipment will become obsolete or won’t add up to big savings after the leasing fee is paid.

Some homebuyers have insisted that the seller buy out the remaining lease, which could be $15,000 or more, as a condition of the home sale.

Harney told the story of a couple near Fresno, Calif. who received multiple offers on their home, but two sets of buyers backed out of the contracts due to the leased solar panels on the roof. Ultimately, the couple had to pay $22,000 to break the lease with the solar company so that they could sell the house.

Harney’s advice: “Be aware of the potential complexities that can occur when you lease, rather than buy, solar panels.

“If you opt for a lease, understand your long-term obligations, and talk to your current utility company about the savings claimed,” Harney wrote. “Most important, if you’ve got a leased system and plan to sell, contact the leasing company well in advance to learn about the lease transfer and buyout options. That way you’ll be ready if prospective buyers have problems with your panels.”

(Photo: Flickr/Michael Coghlan)

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Article and photos sourced from : http://blog.pacunion.com/leased-solar-panels-can-complicate-sale/

2014’s Priciest Silicon Valley Home Sales Share Common Threads

David Barca, vice president of Pacific Union’s Silicon Valley region, authored the following article, which originally appeared in the Palo Alto Weekly on Dec. 26.

Our local real estate markets have seen a significant uptick in sales activity at the highest end of the spectrum thus far in 2014. According to MLS data, there were 17 $10 million-plus single-family home sales in the communities of Atherton, Palo Alto, and Woodside between Jan. 1 and Nov. 30, a 70 percent increase from that same period in 2013.

This year’s 10 most expensive home sales in the aforementioned communities that were listed on the MLS through Nov. 30 ranged from $27.4 million to $13.5 million — six in Atherton, and two each in Palo Alto and Woodside. The properties run the gamut in terms of size, from a 13,558-square-foot mansion in West Atherton to a relatively modest 5,240-square-foot home in the coveted Old Palo Alto neighborhood.

Although these 10 top-dollar homes are unique on their own, a few common threads weave through the transactions:

Springtime Sales

Seven of these homes sold in the second quarter, underscoring that real estate activity heats up in the spring and early summer when sellers are likely to encounter many buyers hoping to land a home before schools close for the summer. At that time of year, even the priciest properties can attract motivated, fast-acting buyers. For example, two Atherton homes that sold in late June – one for $14 million and one for $13.5 million – were gone in just four days.

The Appeal of New

Newer homes are increasingly popular in the Bay Area, particularly given the influx of buyers from Asia that tend to prefer more recently built properties. Six of this year’s 10 most expensive homes were constructed since the turn of the most recent century, including No. 1 and No. 2: $27.4 million in Atherton and $25 million in Woodside, respectively.

That’s not to say that a home with a little more history won’t appeal to buyers, especially in superheated markets like Palo Alto. The aforementioned Old Palo Alto home, built in 1925, sold for about 2 percent more than original price, the only one of the 10 priciest properties to command a premium.

Hefty Prices Per Square Foot

Paying top dollar per square foot holds especially true at the highest end of our real estate market. The average price per square foot paid for these 10 homes was $1,935, compared with $1,100 for all properties sold in the three communities from January through November.

A three-bedroom home in Woodside that sold in September offers a drastic example of what some affluent, motivated buyers are willing to pay: At just less than 6,000 square feet, the home sold for its $25 million list price, which translates to a staggering $4,170 per square foot.

Proper Pricing Key

Our local real estate markets have recently involved frenzied competition, in which multiple bidders drive the final sales price far beyond the original. In one July instance, a brand-new home in Downtown Palo Alto sold for more than double its original price.

Six of the 10 most expensive homes appear to have been accurately priced, with half of them selling for their exact asking prices, and one fetching a modest premium. The other four homes may not have been priced correctly, allowing buyers a bit of wiggle room to write lower offers.

One such home in West Atherton, initially priced at $16.9 million, sat on the market for almost a year before selling for $15 million, 88.5 percent of its original price. This highlights the fact a property must be priced accurately in order to sell quickly, even in markets where willing buyers far outnumber the inventory of available homes.









(Photo: Flickr/Jeremy Brooks)