Category: Real Estate

Google and LinkedIn property swap paves way for decades of Bay Area real estate hell | VentureBeat | Business | by Chris O’Brien

Longtime Bay Area residents concerned about the tech boom driving up real estate and rental costs often wonder: When will this bubble burst?

Here’s an answer that will bum them out: Never.

Yes, some startups are likely overvalued. And there’s bound to be a unicorn reckoning. But in terms of what’s transforming the Bay Area, the issue is really the massive hiring boom being driven by some of the region’s biggest names: Apple, Google, Facebook, et al.

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In this regard, the news that Google and LinkedIn have agreed to a massive real estate swap is a big deal. As reported by the Silicon Valley Business Journal, the two companies have agreed to exchange properties in Mountain View and Sunnyvale that include 1 million square feet of buildings and another 2.4 million square feet of potential office development space.

Okay, so what?

While the transaction includes numerous parcels, and is a bit complicated, the Journal lays out the bottom line nicely: The deal lets both companies accelerate plans to build the giant, futuristic campuses they want but that have thus far been delayed by their fight for land.

The deal, in turn, will allow them to eventually stuff thousands more employees into their Silicon Valley offices. This would be fine, except that when you add in Apple’s and Facebook’s big new offices, the gigantic campuses being constructed seem to continue to outpace the building of any new housing.

And you don’t need an economics degree to know that this is going to mean even more competition for existing houses and apartments. Followed by increased housing prices and rental rates.

What’s more, these giants are making huge, long-term commitments to their hiring plans by spending heavily on these dream campuses. So whether the stock market is up, down, or sideways, expect these companies to keep building and hiring.

And, in the meantime, don’t hold your breathe waiting for the current real estate madness to ebb. This is not a bubble. It’s the new normal.

What New Homeowners Need to Know | New Homeowners Checklist

We know so well the thrill of owning your own house — but don’t let the excitement cause you to overlook the basics. We’ve gathered up a half dozen classic boo-boos new homeowners often commit — and give you some insight on why each is critically important to avoid.

 

1.  Not Knowing Where the Main Water Shutoff Valve Is

Water from a burst or broken plumbing pipe can spew dozens of gallons into your home’s interior in a matter of minutes, soaking everything in sight — including drywall, flooring, and valuables. In fact, water damage is one of the most common of all household insurance claims.

Quick-twitch reaction is needed to stave off a major bummer. Before disaster hits, find your water shutoff valve, which will be located where a water main enters your house. Make sure everyone knows where it’s located and how to close the valve. A little penetrating oil on the valve stem makes sure it’ll work when you need it to.

2.  Not Calling 811 Before Digging a Hole

Ah, spring! You’re so ready to dig into your new yard and plant bushes and build that fence. But don’t — not until you’ve dialed 811, the national dig-safely hotline. The hotline will contact all your local utilities who will then come to your property — often within a day — to mark the location of underground pipes, cables, and wires.

This free service keeps you safe and helps avoid costly repairs. In many states, calling 811 is the law, so you’ll also avoid fines.

3.  Not Checking the Slope of Foundation Soil

The ground around your foundation should slope away from your house at least 6 inches over 10 feet. Why? To make sure that water from rain and melting snow doesn’t soak the soil around your foundation walls, building up pressure that can cause leaks and crack your foundation, leading to mega-expensive repairs.

This kind of water damage doesn’t happen overnight — it’s accumulative — so the sooner you get after it, the better (and smarter) you’ll be. While you’re at it, make sure downspouts extend at least 5 feet away from your house.

4.  Not Knowing the Depth of Attic Insulation

This goes hand-in-hand with not knowing where your attic access is located, so let’s start there. Find the ceiling hatch, typically a square area framed with molding in a hallway or closet ceiling. Push the hatch cover straight up. Get a ladder and check out the depth of the insulation. If you can see the tops of joists, you definitely don’t have enough.

The recommended insulation for most attics is about R-38 or 10 to 14 inches deep, depending on the type of insulation you choose. BTW, is your hatch insulated, too? Use 4-inch-thick foam board glued to the top.

5.  Carelessly Drilling into Walls

Hanging shelves, closet systems, and artwork means drilling into your walls — but do you know what’s back there? Hidden inside your walls are plumbing pipes, ductwork, wires, and cables.

You can check for some stuff with a stud sensor — a $25 battery-operated tool that detects changes in density to sniff out studs, cables, and ducts.

But stud sensors aren’t foolproof. Protect yourself by drilling only 1¼ inches deep max — enough to clear drywall and plaster but not deep enough to reach most wires and pipes.

Household wiring runs horizontally from outlet to outlet about 8 inches to 2 feet from the floor, so that’s a no-drill zone. Stay clear of vertical locations above and below wall switches — wiring runs along studs to reach switches.

6.  Cutting Down a Tree

The risk isn’t worth it. Even small trees can fall awkwardly, damaging your house, property, or your neighbor’s property. In some locales, you have to obtain a permit first. Cutting down a tree is an art that’s best left to a professional tree service.

The Pros and Cons of Low Mortgage Rates | Realtor Magazine

Many economists saw their predictions of higher interest rates and stronger economic growth shattered this year, mainly due to global economic uncertainty which was then heightened by June’s Brexit vote in the U.K. 

Instead, the U.S is currently experiencing low interest rates and mortgage rates that are the lowest since 2013. While these low rates are boosting the purchasing power of buyers, “A look at the pros and cons of this recent drop in mortgage rates shows that they may not be as unambiguously beneficial to the housing market as previous low rates have been,” says Danielle Hale, NAR’s Director of Housing Statistics.

She listed a few of these pros and cons in a recent blog post:

Pros

• This year has seen a mortgage rate reduction of more than 50 basis points, which gives potential buyers more purchasing power. As Hale points out, a 50 basis point reduction cuts down monthly payments by nearly $50 per $100,000 in home price.
• Income needed to qualify is also reduced by around $1,000 due to this type of mortgage rate reduction.
• Using recent median home price data, this also comes out to a $2,500 reduction in the income needed to finance a home with a 20 percent down payment.

Cons

• While the Brexit vote in June caused mortgage rates to decline, as well as escalated the overall economic uncertainty, most of the mortgage rate decline actually occurred in the first quarter of 2016, a sign that many people had prior concerns about the global economy stagnating.
• This unpredictable global financial news is already causing many consumers to be less optimistic about the state of the housing market, and slowing global growth could also make consumers nervous about its effect on the U.S. labor market.
• Many potential first-time buyers are having trouble finding affordable housing options due to a lack of inventory, and others are struggling to save up for a down payment due to the burden of student loan debt and high rental prices. As Hale points out, this means that the overall benefits of low rates are only being felt by people who already own a home, which adds to the growing wealth gap in the U.S.

Still, “Thus far, the U.S. economy has proven resilient to the weaker global economic environment,” says Hale. “A stronger U.S. consumer, who benefits from lower financing costs, may help ensure that trend continues.”

Selling your home: Curb appeal, upkeep attract buyers – Eau Claire Leader-Telegram

Whether you’re selling your home in the current market or are several years out, the upgrades you invest in can affect more than your wallet.

Being smart about where you spend your money can help your home make a great first impression and command top dollar.

The following are three guidelines for making smart investments when preparing to sell your home.

Curb appeal

Your home’s exterior is the first thing potential buyers see, whether online or in person. 

It’s important that they feel safe and welcome when first experiencing your home. 

You don’t get a second chance to make a first impression so do it right from the start.

• Where to invest? Cleaning and landscaping are low-cost, high-impact updates. Start by scrubbing windows, clearing out gutters and power washing siding. For landscaping options, buy cheap shrubs or cut back existing bushes and plant bright flowers. Freshen up mulch and pull pesky weeds. 

Sprucing up these areas can typically give you 100 percent return on your investment. It’s why curb appeal remains one of the top areas to invest in when selling your home.

Back to basics

Buyers take the basics for granted. 

They expect the furnace to work, windows to open and basements to remain dry. 

If your home needs a new roof, but you splurge on a dream kitchen instead, it could scare off potential buyers, no matter how gourmet your new kitchen looks. 

Buyers have a limit to their budget. They can live with functional and outdated cabinets when they don’t have to worry about the foundation. 

• Where to invest? Ensure your home is well maintained by keeping up with projects while you are living there. It’s inexpensive and less stressful to fix or update over time than right before you plan to put your house on the market. 

It may seem like wasted money when no one can see the updated electrical system, but buyers appreciate a move-in ready and well maintained home.

Quick fix or upgrade?

To upgrade or not is one of the biggest dilemmas sellers have when putting their homes on the market. 

The best place to start is to evaluate how long you expect to be in your home before you plan to put it on the market. 

• Where to invest? If you are looking to list in thenext couple of weeks or months, quick fixes are your best investment. 

A fresh coat of paint on the walls and new cabinet or door hardware can go a long way to update spaces with little effort. 

If you are planning to remain in your home for a longer period before selling, focus on kitchen and bath upgrades that pay back. 

Smaller projects, such as updating countertops and flooring, are great if your cabinets are in good shape. 

Full scale remodels need to show money has been well spent. 

High end appliances, all wood cabinets and walk-in showers are great upgrade decisions. 

How do you decide? Pay attention to what your neighborhood has. If you are the only home with one bathroom, spring for a second instead of a kitchen remodel. 

Also make sure you don’t over-upgrade. 

If no one else in your area has granite countertops, buyers are notother home projects.expecting it and that money can be spent on

Keep in mind that just because you spent $20,000 on new items doesn’t necessarily mean you can just add that onto the asking price. 

Be smart about your home project investment. If you don’t know where to start, begin with asking a realtor or an interior designer before taking on any project, no matter how far out you are from selling. Experts in the industry can help you decide where your money is best spent. That will set you up for success in any market.

 

3 Tips For Buying A Home – Cranford NJ News – TAPinto

Looking to buy a home? Here are three essential tips for making the process as smooth as possible.

Get your finances in order.

Start by getting a full picture of your credit. Obtain copies of your credit report, make sure the facts are correct, and fix any problems you find. Do not make any huge purchases or move your money around three to six months before purchasing a home.

 

Next, find a suitable lender and get pre-approved for a loan. This will put you in a better position to make a serious offer when you do find the right house. There’s a big difference between a buyer being pre-qualified and a buyer who has been pre-approved.  A pre-approval letter shows sellers and real estate agents you’re a serious home-buying candidate because a lender has looked at all of your financial information and they’ve let you know how much you can afford and how much they will lend you.

Don’t forget, too, that there are lots of considerations beyond the price of the home, including property taxes, homeowner association fees, insurance, energy costs, etc.

Hire a professional real estate agent.

While the Internet gives buyers unprecedented access to home listings and resources, many aspects of the buying process require a level of expertise you can’t pick up from surfing the web. That’s why you’re better off using a professional agent than going it alone. If possible, recruit an exclusive buyer agent, who will have your interests at heart and can help you with strategies during the bidding process.

Before making a bid,  look at sales trends of similar homes in the area or neighborhood. Come up with an asking price that’s competitive, but also realistic. Otherwise, you may end up ticking off your seller.

Think long term.

You shouldn’t buy unless you’re sure you’ll be staying put for at least a few years. When it comes to the house itself, you should hire a home inspector, who can point out potential problems that could require costly repairs in the future.

Before you purchase, drive by the house at different times of the day and evening to see what’s happening in the neighborhood. Drive your regular commute from the house to make sure it is something you can deal with on a daily basis. Find out how far it is to the nearest grocery store, hospital, transportation and other services you may need.

5-Step Checklist to Spruce Up a Backyard | Realtor Magazine

Amber Freda, a landscape designer in New York, recently shared with The New York Times a checklist that can make it easier for your clients to decorate their home’s outdoor space. Some of her tips include:

1. Choose the right furniture. Don’t leave a blank slate. “Furniture is probably the most important thing, so you can start using the outdoor space even before you get the plantings figured out,” Freda told The New York Times. Create a space for lounging, for example, with just simple chairs and small drink tables.

2. Get some planters. Use planters arranged around the perimeter. “Machine-made terra cottas are prone to cracking in the winter,” Freda says. “Handmade terra cotta is better, and the thicker it is, the longer lasting it will be. Fiberglass will last forever, and you can get it in any color imaginable.”

3. Add lighting. “If there’s not enough ambient lighting already, look at doing uplighting — low-voltage landscape lighting in the planters,” Freda says. An entire system can plug into an existing outlet so no electrician is needed.

4. Define with a rug. An outdoor rug can be “a nice way to break up a space, and make it feel like an outdoor living or dining room,” Freda says.

5. Add some shade. An umbrella can make an outdoor space more inviting by offering some shade from the bright sun overhead. “Some [outdoor umbrellas] are rated for wind resistance, with vents in the canopies,” Freda says. “And the bases can be a few hundred pounds” to avoid them blowing away. Shade sails and pergolas can also add some “elegance” to an outdoor space.

3 Mortgage Mistakes Buyers Keep Making | Realtor Magazine

The mortgage process can be overwhelming to your buyers. David Gunn, mortgage sales effectiveness director for Fifth Third Mortgage, recently shared with HousingWire some of the biggest mistakes buyers make when purchasing a home.

Believing you don’t make enough for a down payment.

Low down payment mortgages are becoming more available. The Freddie Mac Home Possible Advantage Mortgage, for example, allows buyers to put down 3 percent on their home purchase. Mortgage lenders can help identify which programs potential buyers can qualify for. “People tell us they can’t afford a house because of the down payment,” Gunn told HousingWire. “It’s the most common barrier to buying a home. But we find that a buyer needs less money than she thinks to get into a home with a monthly payment that meets her budget.”

Not having closing time patience.

The timeline for settlement has been growing. Since the Consumer Financial Protection Bureau’s Know Before You Owe rule took effect last October, timelines on home closings have lengthened somewhat. The new mortgage disclosure rules can result in three-day delays for reviews if any changes to the mortgage terms arise. “Be patient, and know that all of the changes are made to help you better understand the mortgage terms and help you find the best loan for you,” Gunn says.

Sticking to one type of loan.

The 30-year fixed-rate loan — while the most popular — doesn’t always have to be the go-to. Certain loan types may make more sense, depending on the buyers’ situation. “It might be better to get a lower term loan now to build equity, and then move into something bigger in a few years,” Gunn says. A lender can take a look at a buyers’ financial situation and goals to make a suggestion of whether a longer term or shorter term loan makes the most sense.

Mortgage Rates Near All-Time Lows | Realtor Magazine

Mortgage rates hit a new 2016 low this week, and they’re also nearing the lowest averages ever recorded. Freddie Mac reports the 30-year mortgage rate is close to the November 2012 record low of 3.31 percent. 

“Continuing fallout from the Brexit vote drove Treasury yields lower again this week,” says Sean Becketti, Freddie Mac’s chief economist. “ The 30-year fixed-rate mortgage followed Treasury yields, falling 7 basis points to 3.41 percent in this week’s survey. Mortgage rates have now dropped 15 basis points over the past two weeks, leaving them only 10 basis points above the all-time low.” 

Freddie Mac reports the following national averages with mortgage rates for the week ending July 7:

• 30-year fixed-rate mortgage: averaged 3.41 percent, with an average 0.5 point, dropping from last week’s 3.48 percent average. Last year at this time, 30-year rates averaged 4.04 percent. 
• 15-year fixed-rate mortgages: averaged 2.74 percent, with an average 0.4 point, falling from last week’s 2.78 percent average. A year ago, 15-year rates averaged 3.20 percent. 
• 5-year hybrid adjustable-rate mortgages: averaged 2.68 percent, with an average 0.5 point, falling from last week’s 2.70 percent average. A year ago, 5-year ARMs averaged 2.93 percent. 

10 Cities With the Highest Rents | Realtor Magazine

San Francisco, New York, and San Jose, Calif., have the highest rents in the nation, according to the Zumper National Rent Report. The report analyzes data from more than 1 million active listings nationwide and calculates the median asking rents for the top 100 metro areas by population.

The following are the 10 priciest cities for apartments (listed with the median rent of a one-bedroom rental):

1. San Francisco: $3,510
2. New York: $3,190
3. San Jose, Calif.: $2,280
4. Oakland, Calif.: $2,270
5. Boston: $2,230
6. Washington, D.C.: $2,190
7. Los Angeles: $1,960
8. Miami: $1,900
9. Honolulu: $1,840
10. Seattle: $1,740

States Where Homes Sell in Less Than a Month | Realtor Magazine

n some locales, at least half of the properties sold between March and May were on the market for 30 days or less, according to the latest REALTORS® Confidence Index Survey Report. Properties sold the fastest in 12 states: California, Colorado, District of Columbia, Idaho, Iowa, Kansas, Massachusetts, Minnesota, Nebraska, Oregon, Texas, Utah, and Washington, the report shows.

Properties are selling faster nationwide, too. In May, homes across the country were typically on the market for 32 days on average (compared to 39 days a year ago). Short sales tended to stay on the market the longest amount of time, at 103 days on average, while foreclosed properties were on the market for 51 days. Non-distressed properties stayed on the market for an average of 30 days, according to the National Association of REALTORS®.

Nearly 50 percent of sold properties nationally were on the market for less than a month, according to NAR. Only about 11 percent of properties sold in May were on the market for longer than six months.

 

Source: “In What States Did Properties Sell Quickly in March-May 2016?” National Association of REALTORS® Economists’ Outlook Blog (June 28, 2016)