In order to buy a house you have to get your "house " in order.
There are lots of purchases that are highly prone to impulse buying: shoes on sale, puppies at the pound, and carrot cupcakes with cream cheese buttercream frosting come instantly to mind.
But houses? Not so much. Savvy, regret-free home buying, can take weeks or months of financial and lifestyle research and planning. If you want 2011 to be the year you become a homeowner, here are 5 things you should be doing, as we speak.
1. Minimize your holiday spending and save your cash. Instead of using the holiday sales to acquire a new winter wardrobe of cashmere sweaters, hold the discretionary spending down so you can give yourself the gift of homeownership! If you are serious about buying a home next year, don't run up additional credit card debt on gifts this year. Instead, make homemade cards or write holiday letters this year for everyone except the kiddos. And even for the kids, consider scaling back on the stuff, spending more of your time with them than your money, and getting started now saving toward your home purchase.
Kick start your 2011 home buying resolution by starting a "Home" savings account at an high-interest, online bank (the discipline-boosting goal is a bank that isn't super easy to transfer funds out of when you run low on cash), and set up an automatic deposit into it every payday. To get specific about your savings goal, if you're cash-flush, obviously a 20% down payment will get you top notch interest rates and provide you with the maximum ability to manage your monthly payments. If you're going to be more of a bootstrapping buyer, an FHA loan might be right up your alley - they offer a down payment of 3.5% of the purchase price.
All buyers should plan to have at least 3 percent of the purchase price saved up for closing costs, even if you want the seller to chip in. The lower-priced the home you want to buy, the more percentage points you should be willing to chip in for closing costs. It's easy for closing costs on an $600,000.00 FHA loan to run as high as $18,000 or more, considering transfer taxes, inspections, appraisals and mortgage insurance fees. So, even the scrappiest buyer should have a savings target somewhere around 6.5% of their target home's price. To buy a $700,000 home, for example, that would mean a savings target of around $45,000.
Ask me to help you clarify realistic "cash to close" expectations and savings targets for buying in San Francisco.
2. Research financing, areas homes, prices, agents and online. Smart home buying takes a lot of research and knowledge-gathering. Since most buyers find it much harder to qualify for a mortgage than it is to find a home you'd love to live in, start with studying up on home financing and what it will take for you to get a home loan (note: FHA loans are preferred by the average homebuyer on today's market who has less than a 10% down payment, so start your research there).
Also, start to develop a feel for home prices in a what-you-get-for-your-money type way, and start narrowing down the home styles and even neighborhoods that might fit your aesthetic preferences and lifestyle. If you're one of those rare buyers-to-be who is not already obsessively house hunting, hop on www.zephyrsf.com and start regularly checking out homes and neighborhoods, making sure to take advantage of the neighborhood ratings and reviews feature, which empowers you to surface what other folks think and say about an area.
3. Rehab your credit, if you need to. Go to AnnualCreditReport.com and check out your credit reports - from all 3 bureaus - for free. (Note - these will not give you your credit score for free - that costs extra, but it will give you the actual detailed credit reports.) Audit them for errors and do the work of disputing inaccuracies to have them corrected. Pay particular attention to: accounts that are not yours/you never opened, derogatory information that should have "aged off" your report by now (i.e., 7 years for late payments, 10 for bankruptcies) and balances or credit limits that are inaccurate (i.e., your credit card balance is listed at $2500, but you actually only owe $250.) These are the errors most likely to foul up your financing, so follow the instructions each bureau provides to correct them, stat. While you're at it, don't close any accounts, even if you are able to pay some down or off. Doing that
could actually make your credit score worse
4. Run your numbers. In the past, some overextended homeowners complained that they felt pushed into a mortgage they couldn't afford. Pundits blamed that on the real estate and mortgage industry, but I have witnessed firsthand many a homebuyer push themselves or their spouses into buying too expensive of a home. Eliminate this issue entirely by doing this - run your own numbers, before you ever even talk to a salesperson or start looking at homes beyond your means. (I assure you, once you see the million dollar home you think you can afford, the $250,000 home you can actually afford will be underwhelming.)
Get your monthly finances in order, and get a clear read on how much your monthly bills are - outside of housing. Decide how much you can afford to spend every month for housing, when you buy your home. Get clear on exactly how much cash you plan to have at hand to put into your transaction up front. When, in the next step, you begin working with a mortgage broker, you'll want to share these numbers with them, early on in your conversation, to empower them to tell you what home price you can afford - not based on their rubrics, but based on what you say you want to spend every month and what you want to put down.
5. Talk to a real estate and mortgage broker (1 of each). I am a Real Estate Broker with over eleven years experience helping buyers just like you. I can refer you to a couple of mortgage brokers and a mortgage banker that are trustworthy and will work hard for you. Ask your questions freely, remembering there are no stupid questions, and gauge the response time and the thoroughness of their answer, and that they communicate to you in a language you understand. After you have one of them pull your credit report you might want to go over with them any advice they may have about improving your score, what the rates you qualify for and what price range. Ask them how long it will take them to produce a pre-approval letter once you find a property you want to make an offer on.
Drop me an email, letting me know that you'd like to work on putting an action plan together for buying a home next year, and would like to talk with me about what action steps need to go on the list. Ask me to brief you on the timeline of a transaction in our market, and to point out for you things like when along the process you'll need to bring money in, when you'll need to miss work and come into their office or the closing office. I offer conveniences like digital document signing. Generally the local standard practices about which buyers like you will need to know. Depending on your target home purchase timeline, I might even want you to take a spin with me and look at a few properties to reality-check your expectations or narrow down a broad wish list and for us to get to know one another better.
I look forward to hearing from you in the New Year!
Thursday, December 9, 2010
Friday, November 12, 2010
Hayes Valley Land sales hint at real estate upturn
Robert Selna, SF Chronicle, Friday, November 5, 2010
A developer has agreed to pay several million dollars for property inherited by the city of San Francisco when the Central Freeway came down, suggesting the area's real estate is heating up again following a recessionary slump.
The two parcels sit between Octavia Boulevard and Gough Street, one on Hayes Street, the other two blocks north. As part of a city auction Oct. 26, the developer paid $5 million for one 17,000-square-foot plot and $3 million for another that is 11,000 square feet - more than the minimum bids of $4.4 million and $2.95 million, respectively, set by the city.
According to city officials, the buyer is DM Development. The company could not be reached for comment, but it is widely believed that it plans to build housing on the land.
The two lots are among 22 parcels that once lined the streets along the double-decker freeway, which began to be torn down in 1992 after being severely damaged in the Loma Prieta earthquake. Since 2002, the city has auctioned or attempted to sell the land, most of which is expected to be developed into housing units above retail space.
The auction results last week and strong sales at a new 31-unit condominium nearby have encouraged the city to auction three more parcels in the coming months. Once those are sold, the city will have nearly completed the distribution of the land.
The properties are an integral part of a neighborhood rezoning plan to add as many as 6,000 housing units while creating a walkable, thriving area accessible to public transportation.
New boulevard
Central to that concept is the new Octavia Boulevard, the poplar-lined thoroughfare that replaced a large section of freeway. Proceeds from city property sales are required to be used to pay off the debt incurred for the boulevard's construction.
The city's ambitious goals were slowed for years by debates over the plan's finer points, such as affordable housing, developer fees and parking space limitations. The bad economy has made if difficult for builders to obtain construction loans, but momentum appears to be building for new projects.
'Helping to heal'
"At one time the freeway bisected the area and developing the parcels is helping to heal the neighborhood," said Rich Hillis, deputy director in the Mayor's Office of Economic and Workforce Development. "A lot of the changes in Hayes Valley were sparked by the removal of the freeway and we think the developments near Octavia Boulevard will close out a project that has been successful."
The first freeway parcel development is nearing completion at the corner of Octavia Boulevard and Oak Street. Meanwhile, the LindenHayes condominium project has seen brisk sales since it placed units on the market in June, according to Doug Shaw of Union Pacific brokerage.
Shaw said the sales probably were aided by the fact that not much other new housing has come on the market in the past few months. But he noted that Hayes Valley increasingly is becoming upscale, continuing to add boutiques, restaurants and shops.
"There was an encampment under the freeway overpass and after that came down all the merchants here say it was like night and day," Shaw said. "Octavia is being touted all over the place as a brilliant project in urban planning."
Developers, however, caution that many of the former freeway parcels probably will not be developed for at least a couple of years. The city permitting process and a dearth of construction loans are likely to make progress relatively slow, they say.
Only real concern
"All the arrows are pointing in the right direction and we are bullish on the market; the only real concern is getting a construction loan," said Lou Vasquez, a partner with San Francisco-based Build Inc.. The company owns one 49,000-square-foot freeway parcel that runs from Laguna to Octavia streets and plans to build 150-200 housing units there, he said.
Most see the recession as a temporary bump on the neighborhood's inevitable path toward gentrification. That concerns some residents involved in the area's planning.
High-end housing
The development of new high-end housing and the steep rents along the Hayes Street commercial strip already are starting to make the area unaffordable for working-class people, said Jason Henderson, who chairs the planning and transportation committee of the Hayes Valley Neighborhood Association.
Affordable housing
While there are public and private efforts to create new affordable housing, some residents question whether that can make much of a difference. They note that zoning in the area requires developers to rent or sell 15 percent of new units built in the area at below market rates. But builders also can meet the affordable housing requirements by providing the equivalent of 20 percent of the new housing at below market prices in other parts of the city.
"I'm of two minds about the economic boom in the area," said Henderson. "I believe it's only being (delayed) by the national financial crisis. I also know that we have to be more aggressive about affordable housing; it's a challenge we will face in the coming years as waves of people come in here."
A developer has agreed to pay several million dollars for property inherited by the city of San Francisco when the Central Freeway came down, suggesting the area's real estate is heating up again following a recessionary slump.
The two parcels sit between Octavia Boulevard and Gough Street, one on Hayes Street, the other two blocks north. As part of a city auction Oct. 26, the developer paid $5 million for one 17,000-square-foot plot and $3 million for another that is 11,000 square feet - more than the minimum bids of $4.4 million and $2.95 million, respectively, set by the city.
According to city officials, the buyer is DM Development. The company could not be reached for comment, but it is widely believed that it plans to build housing on the land.
The two lots are among 22 parcels that once lined the streets along the double-decker freeway, which began to be torn down in 1992 after being severely damaged in the Loma Prieta earthquake. Since 2002, the city has auctioned or attempted to sell the land, most of which is expected to be developed into housing units above retail space.
The auction results last week and strong sales at a new 31-unit condominium nearby have encouraged the city to auction three more parcels in the coming months. Once those are sold, the city will have nearly completed the distribution of the land.
The properties are an integral part of a neighborhood rezoning plan to add as many as 6,000 housing units while creating a walkable, thriving area accessible to public transportation.
New boulevard
Central to that concept is the new Octavia Boulevard, the poplar-lined thoroughfare that replaced a large section of freeway. Proceeds from city property sales are required to be used to pay off the debt incurred for the boulevard's construction.
The city's ambitious goals were slowed for years by debates over the plan's finer points, such as affordable housing, developer fees and parking space limitations. The bad economy has made if difficult for builders to obtain construction loans, but momentum appears to be building for new projects.
'Helping to heal'
"At one time the freeway bisected the area and developing the parcels is helping to heal the neighborhood," said Rich Hillis, deputy director in the Mayor's Office of Economic and Workforce Development. "A lot of the changes in Hayes Valley were sparked by the removal of the freeway and we think the developments near Octavia Boulevard will close out a project that has been successful."
The first freeway parcel development is nearing completion at the corner of Octavia Boulevard and Oak Street. Meanwhile, the LindenHayes condominium project has seen brisk sales since it placed units on the market in June, according to Doug Shaw of Union Pacific brokerage.
Shaw said the sales probably were aided by the fact that not much other new housing has come on the market in the past few months. But he noted that Hayes Valley increasingly is becoming upscale, continuing to add boutiques, restaurants and shops.
"There was an encampment under the freeway overpass and after that came down all the merchants here say it was like night and day," Shaw said. "Octavia is being touted all over the place as a brilliant project in urban planning."
Developers, however, caution that many of the former freeway parcels probably will not be developed for at least a couple of years. The city permitting process and a dearth of construction loans are likely to make progress relatively slow, they say.
Only real concern
"All the arrows are pointing in the right direction and we are bullish on the market; the only real concern is getting a construction loan," said Lou Vasquez, a partner with San Francisco-based Build Inc.. The company owns one 49,000-square-foot freeway parcel that runs from Laguna to Octavia streets and plans to build 150-200 housing units there, he said.
Most see the recession as a temporary bump on the neighborhood's inevitable path toward gentrification. That concerns some residents involved in the area's planning.
High-end housing
The development of new high-end housing and the steep rents along the Hayes Street commercial strip already are starting to make the area unaffordable for working-class people, said Jason Henderson, who chairs the planning and transportation committee of the Hayes Valley Neighborhood Association.
Affordable housing
While there are public and private efforts to create new affordable housing, some residents question whether that can make much of a difference. They note that zoning in the area requires developers to rent or sell 15 percent of new units built in the area at below market rates. But builders also can meet the affordable housing requirements by providing the equivalent of 20 percent of the new housing at below market prices in other parts of the city.
"I'm of two minds about the economic boom in the area," said Henderson. "I believe it's only being (delayed) by the national financial crisis. I also know that we have to be more aggressive about affordable housing; it's a challenge we will face in the coming years as waves of people come in here."
San Francisco sees boom in tech workers
By Mike Swift, 11/08/2010
Mercury news
San Francisco has the Golden Gate Bridge, the fog and the tourists. And increasingly, the city also has the geeks.
Just ask Harold Liss, a 26-year-old software engineer who walks three blocks through the Mission District each morning to catch the Yahoo shuttle bus to Sunnyvale, passing knots of other tech workers waiting to catch private shuttles south to Google and Facebook.
"I wanted to live in the city," said Liss, who believes the corporate bus systems at Yahoo and other Silicon Valley companies are "absolutely" helping to fuel a growing population of computer workers in San Francisco. "There is more to do; things are walkable; you don't need a car. There is a lot of great food, a lot of good parties, and you have everything you need in a really small area."
San Francisco's population of computer workers has boomed in the past four years, a Mercury News analysis of census data shows, with the city adding more resident computer workers even than much larger Santa Clara County, the heart of Silicon Valley. Newly released data show that San Francisco gained about 8,600 computer workers from 2005 to 2009, a 51 percent jump, compared with a 7,300-person, or 12 percent, increase in computer workers living in Santa Clara County. The data count workers where they live, not where they work.
With about one in 12 adult residents working in computer-related occupations, Santa Clara County has by far the highest concentration of computer workers in California, and among the highest in the nation. And as companies like Google, Facebook and Cisco Systems add jobs in the valley, that isn't likely to change anytime soon. Among U.S. counties, only much larger Los Angeles County and somewhat larger King County, Wash., the home of Microsoft, have more computer workers than Santa Clara County, 2009 census data show.
"Look at Facebook, they could they have gone to San Francisco. But they came to Palo Alto, to the valley, to flourish," said Phil Mahoney, executive vice president with Cornish & Carey, broker for Moffett Towers, which has struggled for tenants in the down economy.
"There is still a very small fraction of the (tech) employment that's in SOMA, versus the valley as a whole," Mahoney said, referring to San Francisco's South of Market Area. "Just one street in Sunnyvale has pretty much the total employees that the city has, and that's Mathilda Avenue," with the headquarters of Yahoo, Juniper Networks and NetApp.
But with the fast growth of San Francisco-based social networking companies like Twitter, Zynga, Yelp and a host of startups, and the free bus networks operated by big companies that allow tech workers to live in the city and commute painlessly to Silicon Valley, San Francisco now has the third-highest concentration of computer workers among California counties.
Some companies see a San Francisco address as a growing advantage in the cutthroat competition to lure engineering talent, if only because more of that talent now resides in the city. Zynga, the software gaming company that makes the wildly popular "FarmVille" and other social games on Facebook, tripled in size to 1,200 employees in the 12 months preceding September. Citing San Francisco's "unique ability to attract the combination of top creative and tech talent," Zynga recently signed a lease for 270,000 square feet of space in SOMA.
"We think it's going to speak much more to the culture at Zynga than being located someplace less exciting," said Dave Wehner, Zynga's chief financial officer, adding that "being in San Francisco is a differentiator" in the intense competition to recruit talent.
Google's free private buses transport an average of about 2,000 riders a day, up from about 1,200 daily riders in 2007. The Google Shuttle delivers Googlers to Mountain View from San Francisco, and as far north as North Berkeley, as far east as Pleasanton and as far south as Santa Cruz.
Yahoo's buses prowl through the Mission District and a number of other city neighborhoods, pulling over every 10 blocks or so to ingest clusters of workers waiting on the sidewalk, before turning onto Highway 101 and motoring to Sunnyvale. Like Google's buses, the Yahoo buses run on biodiesel, giving environmentally conscious employees another reason to feel good about their commute, besides comfortable seats, the cup holders and the Wi-Fi.
The Yahoo shuttles transport about 225 San Franciscans each day, starting pickups as early as 6:08 a.m. Facebook does not disclose the number of San Franciscans its shuttle delivers to the company's office in Palo Alto, while eBay's private shuttle delivers about 150 workers a day to San Jose.
Liss said there has always been a tech presence in his 31/2 years in San Francisco. But he's noticed it a lot recently, such as his recent birthday party that drew people who work at Google, Twitter and Yahoo.
"I think the growing trend is to live and work in the city, if you can," Liss said of San Francisco's tech presence. "It's definitely a growing, homogeneous social circle."
Mercury news
San Francisco has the Golden Gate Bridge, the fog and the tourists. And increasingly, the city also has the geeks.
Just ask Harold Liss, a 26-year-old software engineer who walks three blocks through the Mission District each morning to catch the Yahoo shuttle bus to Sunnyvale, passing knots of other tech workers waiting to catch private shuttles south to Google and Facebook.
"I wanted to live in the city," said Liss, who believes the corporate bus systems at Yahoo and other Silicon Valley companies are "absolutely" helping to fuel a growing population of computer workers in San Francisco. "There is more to do; things are walkable; you don't need a car. There is a lot of great food, a lot of good parties, and you have everything you need in a really small area."
San Francisco's population of computer workers has boomed in the past four years, a Mercury News analysis of census data shows, with the city adding more resident computer workers even than much larger Santa Clara County, the heart of Silicon Valley. Newly released data show that San Francisco gained about 8,600 computer workers from 2005 to 2009, a 51 percent jump, compared with a 7,300-person, or 12 percent, increase in computer workers living in Santa Clara County. The data count workers where they live, not where they work.
With about one in 12 adult residents working in computer-related occupations, Santa Clara County has by far the highest concentration of computer workers in California, and among the highest in the nation. And as companies like Google, Facebook and Cisco Systems add jobs in the valley, that isn't likely to change anytime soon. Among U.S. counties, only much larger Los Angeles County and somewhat larger King County, Wash., the home of Microsoft, have more computer workers than Santa Clara County, 2009 census data show.
"Look at Facebook, they could they have gone to San Francisco. But they came to Palo Alto, to the valley, to flourish," said Phil Mahoney, executive vice president with Cornish & Carey, broker for Moffett Towers, which has struggled for tenants in the down economy.
"There is still a very small fraction of the (tech) employment that's in SOMA, versus the valley as a whole," Mahoney said, referring to San Francisco's South of Market Area. "Just one street in Sunnyvale has pretty much the total employees that the city has, and that's Mathilda Avenue," with the headquarters of Yahoo, Juniper Networks and NetApp.
But with the fast growth of San Francisco-based social networking companies like Twitter, Zynga, Yelp and a host of startups, and the free bus networks operated by big companies that allow tech workers to live in the city and commute painlessly to Silicon Valley, San Francisco now has the third-highest concentration of computer workers among California counties.
Some companies see a San Francisco address as a growing advantage in the cutthroat competition to lure engineering talent, if only because more of that talent now resides in the city. Zynga, the software gaming company that makes the wildly popular "FarmVille" and other social games on Facebook, tripled in size to 1,200 employees in the 12 months preceding September. Citing San Francisco's "unique ability to attract the combination of top creative and tech talent," Zynga recently signed a lease for 270,000 square feet of space in SOMA.
"We think it's going to speak much more to the culture at Zynga than being located someplace less exciting," said Dave Wehner, Zynga's chief financial officer, adding that "being in San Francisco is a differentiator" in the intense competition to recruit talent.
Google's free private buses transport an average of about 2,000 riders a day, up from about 1,200 daily riders in 2007. The Google Shuttle delivers Googlers to Mountain View from San Francisco, and as far north as North Berkeley, as far east as Pleasanton and as far south as Santa Cruz.
Yahoo's buses prowl through the Mission District and a number of other city neighborhoods, pulling over every 10 blocks or so to ingest clusters of workers waiting on the sidewalk, before turning onto Highway 101 and motoring to Sunnyvale. Like Google's buses, the Yahoo buses run on biodiesel, giving environmentally conscious employees another reason to feel good about their commute, besides comfortable seats, the cup holders and the Wi-Fi.
The Yahoo shuttles transport about 225 San Franciscans each day, starting pickups as early as 6:08 a.m. Facebook does not disclose the number of San Franciscans its shuttle delivers to the company's office in Palo Alto, while eBay's private shuttle delivers about 150 workers a day to San Jose.
Liss said there has always been a tech presence in his 31/2 years in San Francisco. But he's noticed it a lot recently, such as his recent birthday party that drew people who work at Google, Twitter and Yahoo.
"I think the growing trend is to live and work in the city, if you can," Liss said of San Francisco's tech presence. "It's definitely a growing, homogeneous social circle."
Thursday, October 28, 2010
It is the best opportunity to buy real estate in SF
Best time to buy a home in San Francisco
If you or someone you know is thinking of buying real estate; now, and I mean now, 4th qtr of 2010, it might be the very best time, possibly ever or at least for a long time to purchase a home Prices are down, interest rates are down that's a phenomena that happens very infrequently.
And you will have lots to choose from, the inventory in San Francisco is the biggest it’s ever been, especially for 4th quarter.
Follow this link to a story that was in the WSJ today about the credit market:
http://online.wsj.com/article/SB10001424052702303443904575578410336931010.html?mod=ITP_moneyandinvesting_7advertise
if you haven’t developed a relationship with a mortgage lender because you aren’t sure who to call, please don’t just stab away on the net. You need a professional that is familiar and works in the San Francisco Market. You certainly wouldn’t go to the net and find an agent to work with you if they worked somewhere in Ohio would you. Same thing you need to stay local. My experience with those lenders that these unbelievable low rates that when it comes down to the last wire, when you’re expecting loan docs to be drawn all of a sudden that low rate program that they hooked you in with is gone.
I have been selling Real Estate in San Francisco for over 14 years, 11 here in San Francisco. I am the professional you need to get this dream of yours to become
There was a slight dip in prices from July 2010 to August 2010, but YOY we were still up in value by 2.1%! Where can you put your money and earn that kind of return. Let’s take a minute and do a little scenario. Let’s assume you bought a home in San Francisco last August 2009 for $900k, it appreciated at a rate of 2.1%, and presumably it is worth $918,900.now. Not bad.
Prices fell across all three price tiers on a month-over-month basis for single-family homes in the San Francisco MSA for the first time in six months as year-over-year gains also slid.
The bottom third (under $345,613 at the time of acquisition) fell 1.4% from July to August (up 10.3% YOY); the middle third fell 1.2% from July to August (up 6.3% YOY); and the top third (over $628,381 at the time of acquisition) fell 0.5% from July to August (up 2.1% YOY versus 2.8% in July).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA returned to October 2000 levels having fallen 56% from a peak in August 2006, the middle third is back to just below April 2003 levels having fallen 34% from a peak in May 2006, and the top third is back to just below April 2004 levels having fallen 23% from a peak in August 2007.
Condo values in the San Francisco MSA fell 0.5% from July ’10 to August '10 and to a 2.0% gain on a year-over-year basis (down 26.4% from a high in December 2005).
Our standard SocketSite S&P/Case-Shiller footnote: The S&P/Case-Shiller home price indices include San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., greater MSA) and are imperfect in factoring out changes in property values due to improvements versus appreciation (although they try their best).
[Standard & Poor's]
Call me when you have some time and let's set a time to have some coffee and talk about how to start.
415 902 9199
If you or someone you know is thinking of buying real estate; now, and I mean now, 4th qtr of 2010, it might be the very best time, possibly ever or at least for a long time to purchase a home Prices are down, interest rates are down that's a phenomena that happens very infrequently.
And you will have lots to choose from, the inventory in San Francisco is the biggest it’s ever been, especially for 4th quarter.
Follow this link to a story that was in the WSJ today about the credit market:
http://online.wsj.com/article/SB10001424052702303443904575578410336931010.html?mod=ITP_moneyandinvesting_7advertise
if you haven’t developed a relationship with a mortgage lender because you aren’t sure who to call, please don’t just stab away on the net. You need a professional that is familiar and works in the San Francisco Market. You certainly wouldn’t go to the net and find an agent to work with you if they worked somewhere in Ohio would you. Same thing you need to stay local. My experience with those lenders that these unbelievable low rates that when it comes down to the last wire, when you’re expecting loan docs to be drawn all of a sudden that low rate program that they hooked you in with is gone.
I have been selling Real Estate in San Francisco for over 14 years, 11 here in San Francisco. I am the professional you need to get this dream of yours to become
There was a slight dip in prices from July 2010 to August 2010, but YOY we were still up in value by 2.1%! Where can you put your money and earn that kind of return. Let’s take a minute and do a little scenario. Let’s assume you bought a home in San Francisco last August 2009 for $900k, it appreciated at a rate of 2.1%, and presumably it is worth $918,900.now. Not bad.
Prices fell across all three price tiers on a month-over-month basis for single-family homes in the San Francisco MSA for the first time in six months as year-over-year gains also slid.
The bottom third (under $345,613 at the time of acquisition) fell 1.4% from July to August (up 10.3% YOY); the middle third fell 1.2% from July to August (up 6.3% YOY); and the top third (over $628,381 at the time of acquisition) fell 0.5% from July to August (up 2.1% YOY versus 2.8% in July).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA returned to October 2000 levels having fallen 56% from a peak in August 2006, the middle third is back to just below April 2003 levels having fallen 34% from a peak in May 2006, and the top third is back to just below April 2004 levels having fallen 23% from a peak in August 2007.
Condo values in the San Francisco MSA fell 0.5% from July ’10 to August '10 and to a 2.0% gain on a year-over-year basis (down 26.4% from a high in December 2005).
Our standard SocketSite S&P/Case-Shiller footnote: The S&P/Case-Shiller home price indices include San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., greater MSA) and are imperfect in factoring out changes in property values due to improvements versus appreciation (although they try their best).
[Standard & Poor's]
Call me when you have some time and let's set a time to have some coffee and talk about how to start.
415 902 9199
Thursday, October 14, 2010
what's all this about robo-signing? moratorium on foreclosures? can this help or hurt?
I double-dog dare you to watch a TV news show or spend more than 5 minutes on the web without hearing about the massive "robo-signing" foreclosure scandal that is rapidly encompassing the biggest banks in the country. Here are 4 things home buyers need to know about this breaking real estate news, and how it impacts them.
(Hint: I threw in a couple of bonus items at the end!)
1. What is robo-signing is, and what all the fuss is about? The phrase robo-signing refers to what we’re now realizing has been a very common practice in the banks’ foreclosure document processing divisions, where one person was essentially given the job of signing as many 10,000 foreclosure documents per month, by hand. These individuals were supposed to be reviewing the files, making sure grounds for foreclosure actually existed, signing the docs in front of notaries. But because of the volume of documents, what they actually did was just sign thousands of documents at a time, without even reading them, and ship them off somewhere else to be notarized.
If you do the math on an 8 hour workday, you'll see that that only gives the staffer 1.5 minute to review each file and documents to make sure the foreclosure is warranted. That's not humanly possible, which is how these staffers got the nickname “robo-signers”
Government regulators are very concerned that the banks may have been taking people's homes without following the proper legal procedures. As a result, 40 states' attorneys general are teaming up to launch a multi-state investigation, and the federal Comptroller of the Currency and federal attorney general may also get involved in investigating this issue.
2. Will the freeze will make the banks cancel buyer contracts on REO properties? Currently, the freeze impacts bank-owned properties that are owned and/or serviced by Ally Financial/GMAC Mortgage, JP Morgan Chase, and some properties that were owned by Bank of America. Generally, contracts to buy these homes are being put on hold and extended for 30 days. As well, the banks are often reaching out directly to buyers and offering them the option to cancel their contracts and recoup their deposit money.
3. Is it safe to buy a foreclosed home? There's lots of talk right now about the "clouds" that this scandal will create on the titles to homes that were foreclosed by the banks' foreclosure mills. And that makes sense: if the home wasn't properly foreclosed on in the first place, then the legitimacy of the bank's resale can be called into question. Normally, I'd say: Don't worry about it, buyer - that's why you'll get title insurance! But last week, 3 of America's largest title company insurers declared that they will not offer title insurance on a number of the homes that may have been involved in this scandal.
In the vast majority of cases – when the foreclosure was justified and a bona fide purchaser, someone who was not involved in the bank’s wrongdoing, has purchased the home, courts will not reverse these foreclosures or their sale to buyers. But if you’re in the market for a foreclosure, get clear on which bank owns the place as soon as you can, and run the property past your title insurer before you get too far into the transaction to make sure they can write a policy of title insurance on the property before you spend too much money on inspections and appraisals. (And see my Bonus Buyer Advice at the end of this blog post!)
4. How the foreclosure freeze will impact American home values, say after you buy. In the short term, these freezes might cause prices to stabilize, as we expect to see the supply of foreclosures for sale start to shrink. However, if these freezes stretch out for a long period of time, they could simply be delaying many inevitable foreclosures, which could delay the recovery of the housing market and home prices, over time. I wouldn't expect to see the freezes cause prices to drop much beyond where they are now, but if they stretch out, they could keep appreciation flat for a longer period of time.
P.S. - Bonus Buyer Advice from Tara: Don’t underestimate the deals you can get on non-foreclosed properties. You can often get just as good of a price on a better property with more flexibility on the seller’s part in terms of repairs and other negotiation points if you buy a home from an individual seller, as opposed to a bank-owned property.
(Hint: I threw in a couple of bonus items at the end!)
1. What is robo-signing is, and what all the fuss is about? The phrase robo-signing refers to what we’re now realizing has been a very common practice in the banks’ foreclosure document processing divisions, where one person was essentially given the job of signing as many 10,000 foreclosure documents per month, by hand. These individuals were supposed to be reviewing the files, making sure grounds for foreclosure actually existed, signing the docs in front of notaries. But because of the volume of documents, what they actually did was just sign thousands of documents at a time, without even reading them, and ship them off somewhere else to be notarized.
If you do the math on an 8 hour workday, you'll see that that only gives the staffer 1.5 minute to review each file and documents to make sure the foreclosure is warranted. That's not humanly possible, which is how these staffers got the nickname “robo-signers”
Government regulators are very concerned that the banks may have been taking people's homes without following the proper legal procedures. As a result, 40 states' attorneys general are teaming up to launch a multi-state investigation, and the federal Comptroller of the Currency and federal attorney general may also get involved in investigating this issue.
2. Will the freeze will make the banks cancel buyer contracts on REO properties? Currently, the freeze impacts bank-owned properties that are owned and/or serviced by Ally Financial/GMAC Mortgage, JP Morgan Chase, and some properties that were owned by Bank of America. Generally, contracts to buy these homes are being put on hold and extended for 30 days. As well, the banks are often reaching out directly to buyers and offering them the option to cancel their contracts and recoup their deposit money.
3. Is it safe to buy a foreclosed home? There's lots of talk right now about the "clouds" that this scandal will create on the titles to homes that were foreclosed by the banks' foreclosure mills. And that makes sense: if the home wasn't properly foreclosed on in the first place, then the legitimacy of the bank's resale can be called into question. Normally, I'd say: Don't worry about it, buyer - that's why you'll get title insurance! But last week, 3 of America's largest title company insurers declared that they will not offer title insurance on a number of the homes that may have been involved in this scandal.
In the vast majority of cases – when the foreclosure was justified and a bona fide purchaser, someone who was not involved in the bank’s wrongdoing, has purchased the home, courts will not reverse these foreclosures or their sale to buyers. But if you’re in the market for a foreclosure, get clear on which bank owns the place as soon as you can, and run the property past your title insurer before you get too far into the transaction to make sure they can write a policy of title insurance on the property before you spend too much money on inspections and appraisals. (And see my Bonus Buyer Advice at the end of this blog post!)
4. How the foreclosure freeze will impact American home values, say after you buy. In the short term, these freezes might cause prices to stabilize, as we expect to see the supply of foreclosures for sale start to shrink. However, if these freezes stretch out for a long period of time, they could simply be delaying many inevitable foreclosures, which could delay the recovery of the housing market and home prices, over time. I wouldn't expect to see the freezes cause prices to drop much beyond where they are now, but if they stretch out, they could keep appreciation flat for a longer period of time.
P.S. - Bonus Buyer Advice from Tara: Don’t underestimate the deals you can get on non-foreclosed properties. You can often get just as good of a price on a better property with more flexibility on the seller’s part in terms of repairs and other negotiation points if you buy a home from an individual seller, as opposed to a bank-owned property.
Saturday, October 2, 2010
Friday, September 24, 2010
Enough with the doom and gloom about homeownership.
Sure, maybe there's more pain to come in the housing market. But when Time magazine starts running covers that declare "Owning a home may no longer make economic sense," it's time to say: Enough is enough. This is what "capitulation" looks like. Everyone has given up.
After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make you rich?"
But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.
1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.
Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%..
2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.
3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gains–if any–when you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.The June 13, 2005 cover of Time.
4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.
5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.
6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.
7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.
8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.
9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.
10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slump in western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.
Write to Brett Arends at brett.arends@wsj.com
After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make you rich?"
But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.
1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.
Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%..
2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.
3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gains–if any–when you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.The June 13, 2005 cover of Time.
4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.
5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.
6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.
7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.
8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.
9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.
10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slump in western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.
Write to Brett Arends at brett.arends@wsj.com
Monday, September 20, 2010
The Red Shoes
This is a fabulous film, costuming, set decoration, make up
://www.imdb.com/find?s=all&q=the+redshoes
Sunday, September 19, 2010
Drastic Price ReductionPano View Loft- $665k Open 9/19 --2-4pm
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"><html><head></head><body><table width=900 border=0 cellpadding=0 cellspacing=0 align=center><tr><td colspan=3 bgcolor=#000000><img src="http://www.inkswitch.com/marketspace/media/108-img/spg.gif" width=900 height=1></td></tr><tr><td bgcolor=#000000><img src="http://www.inkswitch.com/marketspace/media/108-img/spg.gif" width=1 height=100></td><td bgcolor=#FFFFFF valign=top><table align=center border=0 cellpadding=0 cellspacing=0><tr><td valign=top colspan=5 bgcolor=#000000 style="font-family: Myriad Pro, Myriad, Arial, sans-serif; font-size:12px; color: #ffffff; font-weight: bold; padding: 0px 0px 0px 0px;"><a href="http://www.35LucerneStreet.com" target="_blank"><img src="http://www.inkswitch.com/marketspace/media/108-img/moreDetails.png" border=0 width=171 height=27></a><a href="http://maps.google.com/maps?f=q&hl=en&q=35+Lucerne%2C+%233+San+Francisco%2C+CA" target="_blank"><img src="http://www.inkswitch.com/marketspace/media/108-img/mapProperty.png" border=0 width=128 height=27></a><a href="http://www.zephyrsf.com/search.cfm" target="_blank"><img src="http://www.inkswitch.com/marketspace/media/108-img/searchProperties.png" border=0 width=175 height=27></a><a href="http://www.zephyrsf.com/about.cfm" target="_blank"><img src="http://www.inkswitch.com/marketspace/media/108-img/aboutZephyr.png" border=0 width=103 height=27></a></td></tr><tr><td><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=900 height=30></td></tr></table><table align=center border=0 cellpadding=0 cellspacing=0><tr><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=30 height=30 border=0></td><td><div style="line-height:1.9em;"><font size=6 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>FINAL PRICE REDUCTION<br>Amazing SOMA Loft w/ Private Deck & Garage</b><br></font><font size=5 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><span style="font-weight:bold;">$665,000</span></font> | <font size=3 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b><i>35 Lucerne, #3</i></b> <i>San Francisco, CA</i></font></div></td><td valign=top align=right><a href="http://www.zephyrsf.com/" target="_blank"><img src="http://www.inkswitch.com/marketspace/media/108-img/logo-landscape.png" width=126 height=62 border=0/></a></td></tr><tr><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=40 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=734 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=126 height=1 border=0></td></tr><tr><td colspan=3><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=900 height=10></td></tr></table><table align=center border=0 cellpadding=0 cellspacing=0><tr><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=39 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=463 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=20 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=339 height=1 border=0></td><td><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=39 height=1 border=0></td></tr><tr><td rowspan=2><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=39 height=39></td><td align=right valign=top><img src="http://www.inkswitch.com/docs/40314/image-1.jpg" width=463 height=347 border=0><br><a href="#additional"><img src="http://www.inkswitch.com/marketspace/media/108-img/additional.png" width=123 height=22 border=0></a><br></td><td rowspan=2><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=20 height=20></td><td valign=top rowspan=2><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><div style="line-height:1.5em; font-weight:bold; margin: 4px 0px 6px 0px;">FINAL REDUCTION! GREAT VALUE!<br>Double-height Living Area, Hugh Mezzanine Loft<br>Great Natural Ligfht East & West Exposures<br>Separate & Sunny Gas Kitchen - Granite, Stainless<br>Private Deck w/ 180 degree Downtown Views<br>Private Garage w/ Amazing Storage<br>HOA's $450/month<br><br><br></div></font><img src="http://www.inkswitch.com/marketspace/media/108-img/rule-sm.png" width=330 height=1><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><div style="line-height:1.5em; padding-right: 10px;"><p>REDUCED TO SELL!! This super-scaled 1 bedroom, 1.5 loft on quiet Lucerne Street is turn-key knockout! Dramatic floor-thru unit features a double-height living room with fireplace, custom window treatments, maple flooring, gracious dining area w/ built-in home office, guest ½ bath, & in-unit laundry. Sunny, separate kitchen has granite counters, stainless appliances?.and downtown views! Over-sized mezzanine bedroom features a full-sized closet, full bath with tub-over-shower and ample room for additional seating and storage. Private, walk-out patio has 180 degree views of the spectacular downtown skyline. A private garage with inside entry & huge storage potential completes the picture on this amazing unit. Quiet Lucerne Street is conveniently located to CalTrans, MUNI, and freeways. Its proximity to South Beach, Mission Bay, and Potrero Hill make this particular SOMA address a perfect point of departure for neighborhood shopping, restaurants, clubs, and sporting events at PacBell Park.</p></div></font></td><td rowspan=2><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=39 height=39 border=0></td></tr><tr><td><table align=left border=0 cellpadding=0 cellspacing=0><tr><td valign=top><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>OPEN HOUSE: </font></td><td><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000>Sunday, 9/19 - 2:00 - 4:00PM</font></td></tr><tr><td valign=top><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>BROKER'S TOUR: </font></td><td><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000>Tuesday, 9/21 - 2:30 - 4:00PM</font></td></tr><tr><td valign=top><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>EASY TO SHOW: </font></td><td><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000>Call Listing Agent for Disclosure Matarials</font></td></tr></table></td></tr><tr><td colspan=5><img src="http://www.inkswitch.com/marketspace/media/108-img/mainImageSpace.png" width=900 height=30 border=0></td></tr></table><table align=center cellpadding=0 cellspacing=0 border=0><tr><td width=358> </td><td align=right valign=bottom><img src="http://www.inkswitch.com/docs/40314/agent-1.jpg" width="136" height=100 border=0 style="margin: 0px 10px 0px 10px;"></td><td valign=bottom><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=20 height=20><br><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><i></i></font><br><font size=4 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>Ruby Smith</b></font><br><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>DRE# 01272067</b><br><b>415.902.9199</b><br><a href="mailto:rubysmith@zephyrsf.com"><font color=#000000>rubysmith@zephyrsf.com</font></i></a></font><br><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=20 height=5></td><td valign=bottom><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=20 height=20 ><br><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><i></i></font><br><font size=4 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>Tom Baumgartner</b></font><br><font size=2 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><b>DRE# 01386089</b><br><b>415.730.1130</b><br><a href="mailto:tombaumgartner@zephyrsf.com"><font color=#000000>tombaumgartner@zephyrsf.com</font></i></a></font><br><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=20 height=5></td></tr><tr><td colspan=6 valign=top><a href="http://www.zephyrsf.com"><img src="http://www.inkswitch.com/marketspace/media/108-img/footer.png" width=900 height=53 border=0 alt="www.zephyrsf.com"></a></td></tr></table><table align=center cellpadding=10 cellspacing=0 border=0><tr><td colspan=2><img src="http://www.inkswitch.com/marketspace/media/108-img/white.png" width=32 height=32 border=0><br><a name="additional"><font size=5 face="Myriad Pro, Myriad, Arial, sans-serif" color=#000000><img src="http://www.inkswitch.com/marketspace/media/108-img/headerSpace.png" width=30 height=30 border=0><b>Additional Photos</b></font></a></td></tr><tr><td align=right><img src="http://www.inkswitch.com/docs/40314/image-2.jpg" width=400 height=300 border=0></td><td align="left"><img src="http://www.inkswitch.com/docs/40314/image-3.jpg" width=400 height=300 border=0></td></tr><tr><td align=right><img src="http://www.inkswitch.com/docs/40314/image-4.jpg" width=400 height=300 border=0></td><td align="left"><img src="http://www.inkswitch.com/docs/40314/image-5.jpg" width=400 height=300 border=0></td></tr><tr><td align=right><img src="http://www.inkswitch.com/docs/40314/image-6.jpg" width=400 height=300 border=0></td><td align="left"><img src="http://www.inkswitch.com/docs/40314/image-7.jpg" width=400 height=300 border=0></td></tr><tr><td> </td></tr></table></td><td bgcolor=#000000><img src="http://www.inkswitch.com/marketspace/media/108-img/spg.gif" width=1 height=100></td></tr><tr><td colspan=3 bgcolor=#000000><img src="http://www.inkswitch.com/marketspace/media/108-img/spg.gif" width=900 height=1></td></tr></table><br></body></html>
Saturday, September 18, 2010
Best website for real estate in San Francisco
http://bit.ly/9IgTfP
And I'm just not saying it because I work there. Our website is the best for information regard neighborhoods, how the home buying or selling process works, real "sold" information. And you can find me there!
Friday, September 17, 2010
HGTV's FrontDoor.com Top 10 Home Buying and Selling Tips for Fall
http://bit.ly/de80RJ
Whether you're hunting for a bargain or trying to close a deal before the holidays, there are ways you can take advantage of the season. HGTV's FrontDoor.com identifies the top 10 tips for home buying and selling in the fall.
HGTV's FrontDoor.com Top 10 Home Buying and Selling Tips for Fall
http://bit.ly/de80RJ
Whether you're hunting for a bargain or trying to close a deal before the holidays, there are ways you can take advantage of the season. HGTV's FrontDoor.com identifies the top 10 tips for home buying and selling in the fall.
Thursday, September 16, 2010
Thursday, September 9, 2010
5 Key Steps for First-Time Home Buyers
Key Steps for First-Time Home Buyers
You’ve religiously dined on frozen meals for months. You’ve been stashing away your extra cash instead of spending it on baseball tickets, a pedicure, or a night out on the town. You’ve even been riding the bus to work. Now that you’ve saved enough money for a down payment, you’re finally ready to make the biggest purchase most individuals ever make – buying your first home.
If the sheer amount of information available to first time home owners makes you feel doomed to rent forever, don’t panic! There’s hope, even for a rookie. The following five tips for first time home buyers can help alleviate your pre-purchase jitters:
* Evaluate your current budget and set your future mortgage budget
* Find your ideal real estate agent
* Make the real estate rounds
* Take advantage of home buyer incentives
* Read your purchase contract
1. Evaluate your current budget and set your future mortgage budget
You need to know how much money you can allocate towards your new home before you start looking at properties. A budget that thoroughly outlines your current expenses will help you accomplish this. Start by documenting all of your income in an Excel spreadsheet. Next, track how much and where you’re currently spending money.
Next, you’ll create a mortgage budget, which is a separate budget that helps you plan for reasonable mortgage payments. Your first step is to determine the average price of homes in your desired location and consideration set (e.g, ranch home, two-story, townhouse, condo, etc.). Here are some resources to help you determine your target home price:
Zephyrsf.com - a website where you can search for homes,explore neighborhoods, search for schools,neighborhood market trends save homes you are interested in, receive "real and current data of home values", and if you register you can search sold properties,save favorites,track property values, and get price change and new listing email alert.. And you can choose an agent, like for instance Ruby Smith,
Zillow.com – a Web site that lets you compare selling prices in your selected area.
Realtor.com – another home search tool provided by the National Association of Realtors.
Local newspapers – the classified section in your local newspaper provides a quick check of local home prices.
Your real estate agent –another excellent resource for pricing properties in your area.
Next, estimate what your home purchase loan amount will be. Start by establishing your target monthly home mortgage payment. Freddie Mac's home ownership calculator estimates what you can afford to spend on a home and what loan amount you’ll need to qualify for. Be sure to account for the costs of increased utility bills, property taxes, homeowners’ insurance, and any homeowner’s association fees. The Insurance Information Institute offers guidelines for what you should expect to pay for insurance. You may also be required to pay private mortgage insurance (PMI) if your down payment is less than 20 percent. Freddie Mac http://www.freddiemac.com/corporate/buyown/english/mortgages/selecting/down_payments.html also offers an online calculator that helps you tabulate any possible PMI costs.
Track all of your estimated homeownership costs in a spreadsheet or notebook. Keep a miscellaneous expense category for things like purchasing appliances and maintenance costs. Don’t forget to account for your down payment and closing costs. Most importantly, don’t underestimate your expenses! First-time home buyers are often surprised at how much they shell out for basic upkeep on their properties. Even the little things – fertilizing a lawn, re-painting trim, or hiring a plumber – can add up quickly. This is particularly true if you plan to buy an older home, as it will require more maintenance.
2. Find your ideal real estate agent
Your real estate agent will be your key resource for first time home buyer information. Keep in mind that you’ll spend many Saturday and Sunday afternoons traipsing through homes with your real estate agent. The hours you spend home hunting are more bearable when you have a knowledgeable real estate agent that you get along with.
Consider any referrals as a starting point, but don’t select an agent just because that’s who your aunt and uncle used. Your needs may be different from those of friends or relatives, so always make sure that the agent you select is also an expert in the types of properties and locations that you’re looking for.
Think “location” when searching for possible real estate agents Drive through your desired neighborhoods and check out “for sale” signs to find agents who are already handling comparable transactions. Agents that know a neighborhood well are better equipped to help you navigate your options.
Find out what days and times they’re available to show you houses. Top-notch agents will listen to your wants and needs and will only take you to homes that meet your specifications.
3. Make the real estate rounds
Now that you’ve found the perfect real estate agent, you need to make the rounds. This means physically checking out properties. Online research is helpful, but it’s no substitute for taking the time to explore properties for sale in your preferred location and price range. Bring a home buying checklist to each property that you view. This will help focus your search, and you can use the list later to compare features among the different homes you’ve seen. Mortgageguide101.com and the U.S. Department of Housing and Urban Development both offer printable home buying checklists.
Conduct a thorough examination of each property you visit. Take a friend or relative, preferably one who has already purchased a home, with you when house shopping. Someone else often spots things you may not have initially noticed – a barking dog living next door, a leaky faucet, or rotting wood.
Pay attention to the little stuff. Sellers who neglected basic things, such as maintaining the lawn or shampooing carpets, are likely to also let the big items slide. You don’t want to be stuck buying a new boiler a month after moving in.
You should get to know the entire neighborhood as well as your property. Check out the restaurants, grocery stores, and your prospective neighbors. Test drive times to work if you commute by car.
How will you know when you’ve found your dream home? That’s the million dollar question! Your perfect home should be situated in the right location and should meet all of your checklist needs as well as some of your checklist wants. It should also be comfortably within your price range.
Once you’ve found your perfect home, you should have a professional home inspection conducted. Although home inspection standards vary from city to city, The National Association of Certified Home Inspectors offers some general guidelines for residential inspections – covering basic standards for everything from roofs, exteriors, and basements to heating, cooling, plumbing, and electrical systems. Your real estate agent can refer you to a reputable home inspector.
4. Take advantage of home buyer incentives
Now is the time to buy. Indeed, a range of incentives are offered by sellers, particularly during a buyer’s market. Be aware of the following incentives prior to signing a contract:
Price reductions – Lowering a property’s price is one of the most widely used incentives sellers offer home buyers. Keep in mind, however, that a reduced price may not always be the best incentive for you. First-time home buyers who have limited upfront cash may benefit more in the long-run from non-cash incentives, such as seller-paid mortgage points or down payment assistance.
Seller-paid mortgage points – You can ask a seller to put funds toward mortgage points, typically for a period of one to three years. One mortgage point generally equals one percent of the loan amount and is considered a form of prepaid interest. For example, your mortgage may have a seven percent interest rate. If the seller agrees to pay two interest points for the first year, your interest rate will drop to five percent for that year. Remember that the seller’s contribution won’t last forever, and you’ll be accountable for the higher interest rate when this time period ends.
Service warranties – Sellers may offer limited warranties on a property through a residential service contract. These contracts usually insure a home’s major systems, such as the heating, cooling, or plumbing. Warranties may sound great at first, but you must read the fine print. For example, some warranties may not cover pre-existing conditions, even if that condition was unknown at the time of purchase.
Closing costs – Closing costs aren’t cheap. In fact, Freddie Mac estimates that they cost between two and seven percent of a property’s overall value . You can ask the seller to pay all or a portion of closing costs as part of your purchase negotiations. These costs include taxes, title insurance, financing costs, mortgage points, prepaid or escrowed items – such as homeowner’s insurance, private mortgage insurance, and real estate taxes – and related fees.
5. Read your purchase contract
This may seem like an unnecessary piece of advice, but you’d be surprised by how many people sign contracts they haven’t actually read. Neglecting to read your purchase contract can cause headaches later on, particularly if you decide to resell the property down the road.
Don’t be afraid to negotiate the contract terms before signing on the dotted line. For instance, make a roof repair a condition of the purchase if your inspection shows a leaky roof. You can also ask your attorney or real estate agent to negotiate for some of the buyer’s incentives mentioned above. Finding your dream home can be a time-consuming and intense process. Using the above tips, you can improve your chances of having a hassle-free home buying experience.
You’ve religiously dined on frozen meals for months. You’ve been stashing away your extra cash instead of spending it on baseball tickets, a pedicure, or a night out on the town. You’ve even been riding the bus to work. Now that you’ve saved enough money for a down payment, you’re finally ready to make the biggest purchase most individuals ever make – buying your first home.
If the sheer amount of information available to first time home owners makes you feel doomed to rent forever, don’t panic! There’s hope, even for a rookie. The following five tips for first time home buyers can help alleviate your pre-purchase jitters:
* Evaluate your current budget and set your future mortgage budget
* Find your ideal real estate agent
* Make the real estate rounds
* Take advantage of home buyer incentives
* Read your purchase contract
1. Evaluate your current budget and set your future mortgage budget
You need to know how much money you can allocate towards your new home before you start looking at properties. A budget that thoroughly outlines your current expenses will help you accomplish this. Start by documenting all of your income in an Excel spreadsheet. Next, track how much and where you’re currently spending money.
Next, you’ll create a mortgage budget, which is a separate budget that helps you plan for reasonable mortgage payments. Your first step is to determine the average price of homes in your desired location and consideration set (e.g, ranch home, two-story, townhouse, condo, etc.). Here are some resources to help you determine your target home price:
Zephyrsf.com - a website where you can search for homes,explore neighborhoods, search for schools,neighborhood market trends save homes you are interested in, receive "real and current data of home values", and if you register you can search sold properties,save favorites,track property values, and get price change and new listing email alert.. And you can choose an agent, like for instance Ruby Smith,
Zillow.com – a Web site that lets you compare selling prices in your selected area.
Realtor.com – another home search tool provided by the National Association of Realtors.
Local newspapers – the classified section in your local newspaper provides a quick check of local home prices.
Your real estate agent –another excellent resource for pricing properties in your area.
Next, estimate what your home purchase loan amount will be. Start by establishing your target monthly home mortgage payment. Freddie Mac's home ownership calculator estimates what you can afford to spend on a home and what loan amount you’ll need to qualify for. Be sure to account for the costs of increased utility bills, property taxes, homeowners’ insurance, and any homeowner’s association fees. The Insurance Information Institute offers guidelines for what you should expect to pay for insurance. You may also be required to pay private mortgage insurance (PMI) if your down payment is less than 20 percent. Freddie Mac http://www.freddiemac.com/corporate/buyown/english/mortgages/selecting/down_payments.html also offers an online calculator that helps you tabulate any possible PMI costs.
Track all of your estimated homeownership costs in a spreadsheet or notebook. Keep a miscellaneous expense category for things like purchasing appliances and maintenance costs. Don’t forget to account for your down payment and closing costs. Most importantly, don’t underestimate your expenses! First-time home buyers are often surprised at how much they shell out for basic upkeep on their properties. Even the little things – fertilizing a lawn, re-painting trim, or hiring a plumber – can add up quickly. This is particularly true if you plan to buy an older home, as it will require more maintenance.
2. Find your ideal real estate agent
Your real estate agent will be your key resource for first time home buyer information. Keep in mind that you’ll spend many Saturday and Sunday afternoons traipsing through homes with your real estate agent. The hours you spend home hunting are more bearable when you have a knowledgeable real estate agent that you get along with.
Consider any referrals as a starting point, but don’t select an agent just because that’s who your aunt and uncle used. Your needs may be different from those of friends or relatives, so always make sure that the agent you select is also an expert in the types of properties and locations that you’re looking for.
Think “location” when searching for possible real estate agents Drive through your desired neighborhoods and check out “for sale” signs to find agents who are already handling comparable transactions. Agents that know a neighborhood well are better equipped to help you navigate your options.
Find out what days and times they’re available to show you houses. Top-notch agents will listen to your wants and needs and will only take you to homes that meet your specifications.
3. Make the real estate rounds
Now that you’ve found the perfect real estate agent, you need to make the rounds. This means physically checking out properties. Online research is helpful, but it’s no substitute for taking the time to explore properties for sale in your preferred location and price range. Bring a home buying checklist to each property that you view. This will help focus your search, and you can use the list later to compare features among the different homes you’ve seen. Mortgageguide101.com and the U.S. Department of Housing and Urban Development both offer printable home buying checklists.
Conduct a thorough examination of each property you visit. Take a friend or relative, preferably one who has already purchased a home, with you when house shopping. Someone else often spots things you may not have initially noticed – a barking dog living next door, a leaky faucet, or rotting wood.
Pay attention to the little stuff. Sellers who neglected basic things, such as maintaining the lawn or shampooing carpets, are likely to also let the big items slide. You don’t want to be stuck buying a new boiler a month after moving in.
You should get to know the entire neighborhood as well as your property. Check out the restaurants, grocery stores, and your prospective neighbors. Test drive times to work if you commute by car.
How will you know when you’ve found your dream home? That’s the million dollar question! Your perfect home should be situated in the right location and should meet all of your checklist needs as well as some of your checklist wants. It should also be comfortably within your price range.
Once you’ve found your perfect home, you should have a professional home inspection conducted. Although home inspection standards vary from city to city, The National Association of Certified Home Inspectors offers some general guidelines for residential inspections – covering basic standards for everything from roofs, exteriors, and basements to heating, cooling, plumbing, and electrical systems. Your real estate agent can refer you to a reputable home inspector.
4. Take advantage of home buyer incentives
Now is the time to buy. Indeed, a range of incentives are offered by sellers, particularly during a buyer’s market. Be aware of the following incentives prior to signing a contract:
Price reductions – Lowering a property’s price is one of the most widely used incentives sellers offer home buyers. Keep in mind, however, that a reduced price may not always be the best incentive for you. First-time home buyers who have limited upfront cash may benefit more in the long-run from non-cash incentives, such as seller-paid mortgage points or down payment assistance.
Seller-paid mortgage points – You can ask a seller to put funds toward mortgage points, typically for a period of one to three years. One mortgage point generally equals one percent of the loan amount and is considered a form of prepaid interest. For example, your mortgage may have a seven percent interest rate. If the seller agrees to pay two interest points for the first year, your interest rate will drop to five percent for that year. Remember that the seller’s contribution won’t last forever, and you’ll be accountable for the higher interest rate when this time period ends.
Service warranties – Sellers may offer limited warranties on a property through a residential service contract. These contracts usually insure a home’s major systems, such as the heating, cooling, or plumbing. Warranties may sound great at first, but you must read the fine print. For example, some warranties may not cover pre-existing conditions, even if that condition was unknown at the time of purchase.
Closing costs – Closing costs aren’t cheap. In fact, Freddie Mac estimates that they cost between two and seven percent of a property’s overall value . You can ask the seller to pay all or a portion of closing costs as part of your purchase negotiations. These costs include taxes, title insurance, financing costs, mortgage points, prepaid or escrowed items – such as homeowner’s insurance, private mortgage insurance, and real estate taxes – and related fees.
5. Read your purchase contract
This may seem like an unnecessary piece of advice, but you’d be surprised by how many people sign contracts they haven’t actually read. Neglecting to read your purchase contract can cause headaches later on, particularly if you decide to resell the property down the road.
Don’t be afraid to negotiate the contract terms before signing on the dotted line. For instance, make a roof repair a condition of the purchase if your inspection shows a leaky roof. You can also ask your attorney or real estate agent to negotiate for some of the buyer’s incentives mentioned above. Finding your dream home can be a time-consuming and intense process. Using the above tips, you can improve your chances of having a hassle-free home buying experience.
Thursday, August 26, 2010
SIX Things you can do to Improve Your Credit Score
Q: What do you advise a financially fit homebuyer to do to increase their credit score or make themselves more attractive buyers, to qualify for the lowest mortgage rates?
A: A FICO score of 700 (FHA)/740 (Conventional) or better qualifies you for the lowest rates. In fact, it qualifies you just as well as a higher score, so if you’re at or over 700/740, there’s no loan qualification rationale for investing effort into boosting it. But these are firm breaking points. The difference between a score of 698 and a score of 700 (in an FHA loan scenario) can cost you a quarter of a point in interest, or thousands of dollars over the life of your mortgage.
I’ve found that people asking about how to boost their credit to qualify for the best interest rates is similar to people asking me how to lose weight: I tell them the truth, then their eyes glaze over when I give them the straight dope, no magic bullets. No one wants to hear: eat vegetables, cut the sugar, and exercise; similarly, they don’t want to hear pay your bills on time, every time.
But I’ve been asked this question a lot recently, so here goes, anyway!
1. Pull your reports online – get them for free, no strings attached, at the government authorized website AnnualCreditReport.com. This doesn’t get you your actual FICO scores, but it does get you the content of your report. Look for errors that could be depressing your score, like accounts that don’t belong to you, balances that are actually lower than reported, old debts that are paid off that should have been removed entirely (7 years for credit cards, 10 for bankruptcies).
2. Consider reopening accounts you thought were open but have been closed because you haven’t used them in so long - it will help boost your utilization ratio, one element of your credit score that is dependent on how much available credit you have.
3. Pay down some debt. This both decreases your debt-to-income ratio (36% is the goal, including the proposed mortgage payment) and increases your credit score, if you do it right (see the next tip).
4. Don’t close any accounts. Instead, spread your debt out. The ideal utilization ratio is about 20-30% of your available credit overall, and on any given account. Closing accounts reduces the amount of credit that is available to you, so it makes it look like you’re closer to being maxed out.
So if you have one card that’s near its max and several others that have zero balances and you’re trying boost your score a bit, quickly, consider balance transfers to spread our your debt more evenly, aiming for 20-30% of the available credit on each card.
5. Use your credit regularly – and pay it on time, every time: Having a good FICO score doesn't happen because you have sound personal finances, including no debt. FICO scores are a measure that shows that you have a history of responsibly using and managing and repaying your debt on an ongoing basis.
6. Finally, check in with your mortgage broker. Have them pull your report and score, as the report they pull is the one they’ll have to go by in the final analysis. If you’re really close to a score level higher, that would empower you to qualify for a lower rate, they can actually run a credit diagnostic on your score and generate some recommendations for which actions you could take to raise your score by the needed few points. Then many of them can do what’s called a ‘Rapid Rescore’ – once you’ve paid that bill off, they can actually submit a request directly to the credit bureaus to update that information and your score in just a few days.
None of these tips will get someone with a 500 credit score to a 700 (other than a massive debt reduction program). But if you’re trying to get a little boost to get you over a credit score hump, these can be potent, and save you beaucoup bucks in interest.
written by Tara@Trulia700 credit score
A: A FICO score of 700 (FHA)/740 (Conventional) or better qualifies you for the lowest rates. In fact, it qualifies you just as well as a higher score, so if you’re at or over 700/740, there’s no loan qualification rationale for investing effort into boosting it. But these are firm breaking points. The difference between a score of 698 and a score of 700 (in an FHA loan scenario) can cost you a quarter of a point in interest, or thousands of dollars over the life of your mortgage.
I’ve found that people asking about how to boost their credit to qualify for the best interest rates is similar to people asking me how to lose weight: I tell them the truth, then their eyes glaze over when I give them the straight dope, no magic bullets. No one wants to hear: eat vegetables, cut the sugar, and exercise; similarly, they don’t want to hear pay your bills on time, every time.
But I’ve been asked this question a lot recently, so here goes, anyway!
1. Pull your reports online – get them for free, no strings attached, at the government authorized website AnnualCreditReport.com. This doesn’t get you your actual FICO scores, but it does get you the content of your report. Look for errors that could be depressing your score, like accounts that don’t belong to you, balances that are actually lower than reported, old debts that are paid off that should have been removed entirely (7 years for credit cards, 10 for bankruptcies).
2. Consider reopening accounts you thought were open but have been closed because you haven’t used them in so long - it will help boost your utilization ratio, one element of your credit score that is dependent on how much available credit you have.
3. Pay down some debt. This both decreases your debt-to-income ratio (36% is the goal, including the proposed mortgage payment) and increases your credit score, if you do it right (see the next tip).
4. Don’t close any accounts. Instead, spread your debt out. The ideal utilization ratio is about 20-30% of your available credit overall, and on any given account. Closing accounts reduces the amount of credit that is available to you, so it makes it look like you’re closer to being maxed out.
So if you have one card that’s near its max and several others that have zero balances and you’re trying boost your score a bit, quickly, consider balance transfers to spread our your debt more evenly, aiming for 20-30% of the available credit on each card.
5. Use your credit regularly – and pay it on time, every time: Having a good FICO score doesn't happen because you have sound personal finances, including no debt. FICO scores are a measure that shows that you have a history of responsibly using and managing and repaying your debt on an ongoing basis.
6. Finally, check in with your mortgage broker. Have them pull your report and score, as the report they pull is the one they’ll have to go by in the final analysis. If you’re really close to a score level higher, that would empower you to qualify for a lower rate, they can actually run a credit diagnostic on your score and generate some recommendations for which actions you could take to raise your score by the needed few points. Then many of them can do what’s called a ‘Rapid Rescore’ – once you’ve paid that bill off, they can actually submit a request directly to the credit bureaus to update that information and your score in just a few days.
None of these tips will get someone with a 500 credit score to a 700 (other than a massive debt reduction program). But if you’re trying to get a little boost to get you over a credit score hump, these can be potent, and save you beaucoup bucks in interest.
written by Tara@Trulia700 credit score
Saturday, August 14, 2010
What a Short Sale is
When a owner is in trouble with making payments on a property, he/she may try to sell the property to avoid foreclosure. Typically in these times there is a first loan on the property and a second loan. There also may be unpaid property taxes and penalties on their missed payments. Usually the owner has to submit to the lenders a “Hardship Letter” to the lender(s). Then the lender makes the decision whether to allow the sale. The lender(s) would have asked the owner to hire a Realtor to do a “Brokers Price Opinion” (BPO)and submit it to the lender(s). In current times, the value of the property is often less than the combined loans, back taxes and penalties. The lender(s) would then agree on an offer price that they would accept and the Realtor would begin to market the property. Once an offer was received it would be sent to the lender for final approval.
Recently, maybe because there are so many short sales coming up, or there are owners and Realtors who may be unsure of what the process is, the property is put on the market before doing the previous steps. Offers are received and then they are all sent to the lender hoping one will be approved. This is why you might hear from someone who put an offer on a short sale 4 months ago and they still haven’t heard anything.
These are the things you need to know when thinking about making an offer on a short sale:
1. Ask your Realtor if a hardship letter was presented to the lender(s) prior to the time the property was put on the market
2. Ask your Realtor if a BPO was done and approved
3. Ask your Realtor to find out the amount of the current loans on the property
4. Have offers been received and how long have they been at the lender waiting for approval
I might be going out on a limb here, however, my experience tells me that if the first 2 steps were skipped the process will take longer. The lender(s) will “sit” on the offers until they receive one that more closely covers the current loan amounts. If they have to lose money on penalties, those are just paper loses to them, however they might approve an offer if they still may get the whole principal owed.
For example, there is a property listed for sale at $790k. it’s a s short sale. The two loans on the property are 560k and 140k respec tively. With the back taxes, penalties and the commission for selling the property the purchase price will closely cover most of the debt. Buyers are able to get their offer approved and close escrow. The owner is able to walk away without a foreclosure on his credit report. The Realtor was smart and knew how the process worked to get good results for his seller.
Another case, which is more common, is when the loans, penalties, property taxes all amount to more than the property is valued at. And the owner did not start the process with the lenders. The owner puts the property on the market with a not so informed real estate agent who markets the property below market value. Offers are received and sent to the lenders for approval. The purchase price may cover the lender who is in first position; and then they’re happy. But the lender who is in second position may not get the whole amount due or may end up getting nothing. They are not happy, they hold up the approval of the sale. Both lenders have to agree on releasing the loans in order for the property to be sold. This is why the offers can sit in someone’s “In-box” for months. Eventually, if the owner is lucky and his real estate agent gets smarter, an offer is finally received that is closer to the amount of both loans and the offer gets accepted and closes escrow. The buyer(s) are happy, the owner is happy, he has avoided foreclosure.
Recently, maybe because there are so many short sales coming up, or there are owners and Realtors who may be unsure of what the process is, the property is put on the market before doing the previous steps. Offers are received and then they are all sent to the lender hoping one will be approved. This is why you might hear from someone who put an offer on a short sale 4 months ago and they still haven’t heard anything.
These are the things you need to know when thinking about making an offer on a short sale:
1. Ask your Realtor if a hardship letter was presented to the lender(s) prior to the time the property was put on the market
2. Ask your Realtor if a BPO was done and approved
3. Ask your Realtor to find out the amount of the current loans on the property
4. Have offers been received and how long have they been at the lender waiting for approval
I might be going out on a limb here, however, my experience tells me that if the first 2 steps were skipped the process will take longer. The lender(s) will “sit” on the offers until they receive one that more closely covers the current loan amounts. If they have to lose money on penalties, those are just paper loses to them, however they might approve an offer if they still may get the whole principal owed.
For example, there is a property listed for sale at $790k. it’s a s short sale. The two loans on the property are 560k and 140k respec tively. With the back taxes, penalties and the commission for selling the property the purchase price will closely cover most of the debt. Buyers are able to get their offer approved and close escrow. The owner is able to walk away without a foreclosure on his credit report. The Realtor was smart and knew how the process worked to get good results for his seller.
Another case, which is more common, is when the loans, penalties, property taxes all amount to more than the property is valued at. And the owner did not start the process with the lenders. The owner puts the property on the market with a not so informed real estate agent who markets the property below market value. Offers are received and sent to the lenders for approval. The purchase price may cover the lender who is in first position; and then they’re happy. But the lender who is in second position may not get the whole amount due or may end up getting nothing. They are not happy, they hold up the approval of the sale. Both lenders have to agree on releasing the loans in order for the property to be sold. This is why the offers can sit in someone’s “In-box” for months. Eventually, if the owner is lucky and his real estate agent gets smarter, an offer is finally received that is closer to the amount of both loans and the offer gets accepted and closes escrow. The buyer(s) are happy, the owner is happy, he has avoided foreclosure.
Friday, March 19, 2010
So, you want to live in your house while it's on the market......
If you intend to live in your home while it’s on the market it’s going to take a lot of commitment on your part. Being a Realtor, I will tell you talk to a Realtor, but not any Realtor. Find a Realtor that can give you expert advice about what you need to do to present your property in the best possible light. Find a Realtor who is honest and will not be hesitant to tell you what to do. You will need at the minimum three weeks to get all this done. Moving out, unless you already have someplace to go, and staging is expensive.
With your Realtor, go through your home and let her tell you how and what you need to do. You also might want to go around to Open Houses that are staged to get ideas of how your home should end up looking. You can make it appear staged without actually going through the expense and having to move out while it’s on the market.
First you will have to de-clutter. Prospective buyers have to imagine themselves living there with their stuff, not with your stuff. Hopefully you will be moving soon anyway and if you do all this right you will be. So put all those tchotchkes in a box tape it up and start stacking them in a storage area. This means pictures too. Anything that personalizes the property as yours pack it up! If it’s an item that reminds you of a person, place or thing, pack it up! If you have books on bookshelves take 2/3 of them away. Keep the pretty ones. The rest are too personal. Pack ‘em up! Leave room on the shelves. The less you have laying around the easier it will be to keep it clean and spotless (I will get to that later) Once the clutter is all picked up you are ready for the next step.
Take a good look at your furniture. Is any of it looking shabby? Do you have a futon in that back bedroom that the slipcover is slipping off? Are the cushions on the couch and chairs saggy and worn? Can you have the covers dry cleaned or washed? Will just turning them make it look better? Do this with your Realtor, you need an objective eye when making these assessments. Now, what can you put in storage to make the rooms look more spacious? If you have furniture that is too big for the room it is especially important. If it’s a large sectional, get rid of one of those sections. For instance, in a living room you only need a sofa, a chair, a coffee table, an end table and a lamp and possibly a floor lamp. Buy a few new throw pillows, keep it neutral.
Do the same for the bedrooms. One bedside table with a lamp is enough. One dresser or bureau might be allowable if the room is big enough. Pack the clothes in boxes, label them carefully and add them to your storage area. Nothing should be left on the surfaces. You will need to purchase a new bed set; duvet, pillow shams, a couple of throw pillows. Ask your realtor for advice.
If you have a home office again, de-clutter, only the essentials get to stay. Pack it up label the boxes carefully and put them in your storage area in case you need something from them.
Now the kitchen, this is usually the one a lot of people have the most trouble with. Because home means comfort and comfort is centered on food and the place where it is prepared and eaten. It’s the heart of the home. First of all, the kitchen has to be cleaned. Tooth brushed clean. Walls cleaned, floors are spotless. If you have linoleum on the floor and it’s worn it needs to be replaced. You might have to hire some very obsessive compulsive cleaning person to help. All the fronts of the cabinets have to be spotless and cleaned. If you have cabinets with glass doors take out 2/3 of the stuff. Again, pack and label the boxes put in your storage area in case you need something. Hanging pots need to be put away, it’s too much clutter and again it personalizes the property too much. Prospective buyers have to imagine themselves living there with their stuff, not with your stuff. Counter tops should be bare with the exception of maybe a couple decorative neutral pieces. While you are living there, it will need to be devoid of cooking odors.
Bathrooms have to be spotless. If you have a shower curtain replace it. Buy a new set of towels to put up for Open Houses. If the vanity is old and worn replace it. You don’t have to remodel the bath and you don’t have to spend a lot of money. Just go to Home Depot and buy a new sink or vanity that is more current. If you need a new mirror get that too! This is all easy stuff and fun! A handy man can install them for you or you can do it yourself. It’s not hard.
If you own a single family house rather than a condo you may have to consider having the exterior painted. Again, have your Realtor give you an honest assessment. And don’t go crazy with some color scheme. Realize you are not going to be living there; it won’t be your home anymore. You need to make it neutral so buyers can see themselves owning the property. This sounds like a huge investment, but it has a huge return on your investment.
If you can have all the rooms re-painted then you should definitely do it. The smell of fresh paint has a psychological effect on buyers. Fill all the nail holes where pictures were hanging. If you recently painted, like within the last 2-3 years, you can go around the house with a paint brush and the paint from each room and lightly feather over any spots, dings, gouges and nail holes that you patched. You could hire a handyman to do this. Your Realtor should know someone. On all the baseboards, door and window casings do the same thing with the trim color on any dings or paint chips. If you don’t have the trim color you can take a sample to any paint store and they will match it.
Now for the cleaning. You might want to hire someone to do this but it has to be someone that knows how to clean a property for the market. Windows need to be washed, preferably both inside and out if possible. Windows are very important. They have to be free of any paint on the glass if the room has been painted recently. Floors need to be spotless. If they are carpeted, the carpet needs to be cleaned. If the carpet won’t get clean then you have to replace it. If you have hardwood floors they need to be cleaned and shiny. If they need a coat of urethane to make them that way, then have it done. It’s a small expense with a bigger return on your investment.
Now your house is almost ready! Now you can put a very few accent pieces and hang a couple of pictures on the walls. Don’t go crazy. They still have to be neutral and non-personal. And no more than ONE per wall. If you can live without window coverings take them down, unless they are very neutral and add to the room. You can put 2-3 magazines or coffee table type books on the coffee table. Stack them neatly. Your house should look staged by now.
For every Sunday Open House and all other showings, the house has to be cleaned and spotless. Tell your Realtor to always give you a 24 hour notice for any other showings. It should be devoid of cooking odors, pet smells; dirty laundry in the hamper smells too. Dust and polish the furniture clean off any fingerprints anywhere, Swiffer the floors or vacuum if you have carpet. Put the new bed coverings on the bed. Kitchen cabinets have to be spotless. The stove has to be clean. The refrigerator should not have any fingerprints on the door. And of course you don’t have anything on the front of the refrigerator by now so keeping the front clean will be easy. No kitchen towels hanging around. The counters are clean. The bathroom needs to shine. Put the new towels out. There are a lot of convenience cleaning products that will make this easier on you. While you’re doing this keep telling yourself about all the money that will be in your pocket by not having to move out and stage. When you are done, spray the whole house with a light and almost odorless room deodorizer.
Now go out and enjoy the rest of your day! Your property will sell more quickly.
With your Realtor, go through your home and let her tell you how and what you need to do. You also might want to go around to Open Houses that are staged to get ideas of how your home should end up looking. You can make it appear staged without actually going through the expense and having to move out while it’s on the market.
First you will have to de-clutter. Prospective buyers have to imagine themselves living there with their stuff, not with your stuff. Hopefully you will be moving soon anyway and if you do all this right you will be. So put all those tchotchkes in a box tape it up and start stacking them in a storage area. This means pictures too. Anything that personalizes the property as yours pack it up! If it’s an item that reminds you of a person, place or thing, pack it up! If you have books on bookshelves take 2/3 of them away. Keep the pretty ones. The rest are too personal. Pack ‘em up! Leave room on the shelves. The less you have laying around the easier it will be to keep it clean and spotless (I will get to that later) Once the clutter is all picked up you are ready for the next step.
Take a good look at your furniture. Is any of it looking shabby? Do you have a futon in that back bedroom that the slipcover is slipping off? Are the cushions on the couch and chairs saggy and worn? Can you have the covers dry cleaned or washed? Will just turning them make it look better? Do this with your Realtor, you need an objective eye when making these assessments. Now, what can you put in storage to make the rooms look more spacious? If you have furniture that is too big for the room it is especially important. If it’s a large sectional, get rid of one of those sections. For instance, in a living room you only need a sofa, a chair, a coffee table, an end table and a lamp and possibly a floor lamp. Buy a few new throw pillows, keep it neutral.
Do the same for the bedrooms. One bedside table with a lamp is enough. One dresser or bureau might be allowable if the room is big enough. Pack the clothes in boxes, label them carefully and add them to your storage area. Nothing should be left on the surfaces. You will need to purchase a new bed set; duvet, pillow shams, a couple of throw pillows. Ask your realtor for advice.
If you have a home office again, de-clutter, only the essentials get to stay. Pack it up label the boxes carefully and put them in your storage area in case you need something from them.
Now the kitchen, this is usually the one a lot of people have the most trouble with. Because home means comfort and comfort is centered on food and the place where it is prepared and eaten. It’s the heart of the home. First of all, the kitchen has to be cleaned. Tooth brushed clean. Walls cleaned, floors are spotless. If you have linoleum on the floor and it’s worn it needs to be replaced. You might have to hire some very obsessive compulsive cleaning person to help. All the fronts of the cabinets have to be spotless and cleaned. If you have cabinets with glass doors take out 2/3 of the stuff. Again, pack and label the boxes put in your storage area in case you need something. Hanging pots need to be put away, it’s too much clutter and again it personalizes the property too much. Prospective buyers have to imagine themselves living there with their stuff, not with your stuff. Counter tops should be bare with the exception of maybe a couple decorative neutral pieces. While you are living there, it will need to be devoid of cooking odors.
Bathrooms have to be spotless. If you have a shower curtain replace it. Buy a new set of towels to put up for Open Houses. If the vanity is old and worn replace it. You don’t have to remodel the bath and you don’t have to spend a lot of money. Just go to Home Depot and buy a new sink or vanity that is more current. If you need a new mirror get that too! This is all easy stuff and fun! A handy man can install them for you or you can do it yourself. It’s not hard.
If you own a single family house rather than a condo you may have to consider having the exterior painted. Again, have your Realtor give you an honest assessment. And don’t go crazy with some color scheme. Realize you are not going to be living there; it won’t be your home anymore. You need to make it neutral so buyers can see themselves owning the property. This sounds like a huge investment, but it has a huge return on your investment.
If you can have all the rooms re-painted then you should definitely do it. The smell of fresh paint has a psychological effect on buyers. Fill all the nail holes where pictures were hanging. If you recently painted, like within the last 2-3 years, you can go around the house with a paint brush and the paint from each room and lightly feather over any spots, dings, gouges and nail holes that you patched. You could hire a handyman to do this. Your Realtor should know someone. On all the baseboards, door and window casings do the same thing with the trim color on any dings or paint chips. If you don’t have the trim color you can take a sample to any paint store and they will match it.
Now for the cleaning. You might want to hire someone to do this but it has to be someone that knows how to clean a property for the market. Windows need to be washed, preferably both inside and out if possible. Windows are very important. They have to be free of any paint on the glass if the room has been painted recently. Floors need to be spotless. If they are carpeted, the carpet needs to be cleaned. If the carpet won’t get clean then you have to replace it. If you have hardwood floors they need to be cleaned and shiny. If they need a coat of urethane to make them that way, then have it done. It’s a small expense with a bigger return on your investment.
Now your house is almost ready! Now you can put a very few accent pieces and hang a couple of pictures on the walls. Don’t go crazy. They still have to be neutral and non-personal. And no more than ONE per wall. If you can live without window coverings take them down, unless they are very neutral and add to the room. You can put 2-3 magazines or coffee table type books on the coffee table. Stack them neatly. Your house should look staged by now.
For every Sunday Open House and all other showings, the house has to be cleaned and spotless. Tell your Realtor to always give you a 24 hour notice for any other showings. It should be devoid of cooking odors, pet smells; dirty laundry in the hamper smells too. Dust and polish the furniture clean off any fingerprints anywhere, Swiffer the floors or vacuum if you have carpet. Put the new bed coverings on the bed. Kitchen cabinets have to be spotless. The stove has to be clean. The refrigerator should not have any fingerprints on the door. And of course you don’t have anything on the front of the refrigerator by now so keeping the front clean will be easy. No kitchen towels hanging around. The counters are clean. The bathroom needs to shine. Put the new towels out. There are a lot of convenience cleaning products that will make this easier on you. While you’re doing this keep telling yourself about all the money that will be in your pocket by not having to move out and stage. When you are done, spray the whole house with a light and almost odorless room deodorizer.
Now go out and enjoy the rest of your day! Your property will sell more quickly.
Tuesday, January 26, 2010
Ten Cities To Go From Renting To Buying
Real Estate
Francesca Levy, 01.21.10, 04:50 PM EST
In these metro areas, now is a good time to make the jump to homeownership.
The U.S. government has pushed hard to make homeowners out of one-third of Americans who still rent their homes. It introduced and later extended a tax credit for first-time home buyers, and has kept federal interest rates at their lowest levels since the 1940s.
Market conditions are such that now is a particularly good time for some renters to take the hint.
In Portland, San Francisco, Minneapolis and Washington, D.C., the premium to buy--the spread between what you'd spend on renting and what you'd pay each month for a mortgage--is far narrower now than its 15-year average. And economists predict a significant home-price hike in five years. So upgrading will cost much less than usual, and home buyers are likely to get a good return on their investment.
Note that buying isn't necessarily cheaper than renting in these metro areas. In fact, it often remains a more expensive proposition. But for those determined to own, that investment is a better one now than it normally is.
Take San Francisco. To live here has always required a hefty bump in monthly costs from renting; it's normally an incredible 296% more expensive to buy than lease a home, and the city's residents know this. That's why 42% of them stick to renting. Even though in the third quarter of 2009 the premium was still in the triple digits--233%--it had shrunk by 63 percentage points from the above 15-year average. As with the other cities we've highlighted, you're not getting nearly as good a deal by renting as you might have just a few years ago.
"Rents are falling, but not nearly as rapidly as home prices," says Ron Witten, founder of Dallas-based Witten Advisors, an apartment market consulting firm. "Part of the reason is a shift away from home ownership toward renting," he says, in part because mortgages have become harder for many to obtain.
Behind the Numbers
To find cities where it's a good time to go from renting to buying, we used data from Witten Advisors, which calculated the premium to buy for 42 Metropolitan Statistical Areas across the country using data from the U.S. Census, the National Association of Realtors and a blended average of fixed- and adjustable-rate mortgages from the Federal Housing Finance Agency (which oversees and regulates lenders). We compared the premium in the third quarter of 2009 with the average premium over the last 15 years to find the biggest drops.
We also wanted to pinpoint markets where home buying is a smart investment, so we factored in the five-year forecast in the S&P/Case-Shiller Home Price Index from Moody's ( MCO - news - people )Economy.com. The cities on our list have some of the biggest discounts on the premium to buy coupled with big projected increases in home prices over the next five years.
One major market we didn't look at is New York City, another spot where rents have softened less than home prices. Witten Advisors doesn't track the metro area because accurate historical data on rental costs there is exceedingly difficult to obtain.
Quality of Life, at a Discount
Portland, Ore., makes our list for much the same reason that San Francisco does: It's a picturesque, culture-driven city with good local services and amenities. The city is still not particularly cheap for buyers--but it's cheaper than normal.
A family hoping to put down roots there would normally pay a 62% premium to go from renting to buying. In the third quarter of 2009, however, that premium shrank by 16 percentage points. At the same time, Moody's Economy.com anticipates that home prices will jump 19% over the next five years. That's partly because, like San Francisco, Portland has strict government limitations on building and a coastal location that keep sprawl in check.
"Portland has one of the most controlled environments in the country in terms of development rights," says Stuart Gabriel, director of the Ziman Center for Real Estate at the UCLA Anderson School of Management. "Those supply constraints will push prices up."
Jobs Stability
The presence of jobs--along with strong industries that will keep generating new ones--is a big factor in keeping demand for homes, and therefore home prices, high. The weak national economy has helped reduce the premium to buy for the time being, but where the labor market is relatively healthy, home prices are predicted to shoot up.
In Minneapolis, for example, where large companies including Target ( TGT - news - people ) and General Mills ( GIS - news - people ) have their corporate headquarters (and there's a large university system), home buyers will only pay 14% more than if they were renting (24 percentage points lower than average), and home prices should climb by 15% in five years.
Similarly, in Washington, D.C., government jobs are plentiful, and anticipated to stay that way. The 6.1% unemployment rate here is well below the national average, which is partly why Moody's anticipates a five-year jump in home prices of 15%. And, at the moment, the premium to buy is 20 percentage points lower than its usual 57%.
Of course, whether buying or renting is best is ultimately an individual choice, and one driven by a lot more than map coordinates. When subprime lending was rampant, many without the means to buy were encouraged to do so anyway--and it's no secret how that turned out.
"If there's anything we should have learned from this housing cycle, it's that the decision to buy or rent ought to be a personal lifestyle decision," says Witten. "In part, it's a question about, 'Do I want to be a homeowner' in general, and specifically, 'Do I want to be a homeowner now, with this economic uncertainty?'
Francesca Levy, 01.21.10, 04:50 PM EST
In these metro areas, now is a good time to make the jump to homeownership.
The U.S. government has pushed hard to make homeowners out of one-third of Americans who still rent their homes. It introduced and later extended a tax credit for first-time home buyers, and has kept federal interest rates at their lowest levels since the 1940s.
Market conditions are such that now is a particularly good time for some renters to take the hint.
In Portland, San Francisco, Minneapolis and Washington, D.C., the premium to buy--the spread between what you'd spend on renting and what you'd pay each month for a mortgage--is far narrower now than its 15-year average. And economists predict a significant home-price hike in five years. So upgrading will cost much less than usual, and home buyers are likely to get a good return on their investment.
Note that buying isn't necessarily cheaper than renting in these metro areas. In fact, it often remains a more expensive proposition. But for those determined to own, that investment is a better one now than it normally is.
Take San Francisco. To live here has always required a hefty bump in monthly costs from renting; it's normally an incredible 296% more expensive to buy than lease a home, and the city's residents know this. That's why 42% of them stick to renting. Even though in the third quarter of 2009 the premium was still in the triple digits--233%--it had shrunk by 63 percentage points from the above 15-year average. As with the other cities we've highlighted, you're not getting nearly as good a deal by renting as you might have just a few years ago.
"Rents are falling, but not nearly as rapidly as home prices," says Ron Witten, founder of Dallas-based Witten Advisors, an apartment market consulting firm. "Part of the reason is a shift away from home ownership toward renting," he says, in part because mortgages have become harder for many to obtain.
Behind the Numbers
To find cities where it's a good time to go from renting to buying, we used data from Witten Advisors, which calculated the premium to buy for 42 Metropolitan Statistical Areas across the country using data from the U.S. Census, the National Association of Realtors and a blended average of fixed- and adjustable-rate mortgages from the Federal Housing Finance Agency (which oversees and regulates lenders). We compared the premium in the third quarter of 2009 with the average premium over the last 15 years to find the biggest drops.
We also wanted to pinpoint markets where home buying is a smart investment, so we factored in the five-year forecast in the S&P/Case-Shiller Home Price Index from Moody's ( MCO - news - people )Economy.com. The cities on our list have some of the biggest discounts on the premium to buy coupled with big projected increases in home prices over the next five years.
One major market we didn't look at is New York City, another spot where rents have softened less than home prices. Witten Advisors doesn't track the metro area because accurate historical data on rental costs there is exceedingly difficult to obtain.
Quality of Life, at a Discount
Portland, Ore., makes our list for much the same reason that San Francisco does: It's a picturesque, culture-driven city with good local services and amenities. The city is still not particularly cheap for buyers--but it's cheaper than normal.
A family hoping to put down roots there would normally pay a 62% premium to go from renting to buying. In the third quarter of 2009, however, that premium shrank by 16 percentage points. At the same time, Moody's Economy.com anticipates that home prices will jump 19% over the next five years. That's partly because, like San Francisco, Portland has strict government limitations on building and a coastal location that keep sprawl in check.
"Portland has one of the most controlled environments in the country in terms of development rights," says Stuart Gabriel, director of the Ziman Center for Real Estate at the UCLA Anderson School of Management. "Those supply constraints will push prices up."
Jobs Stability
The presence of jobs--along with strong industries that will keep generating new ones--is a big factor in keeping demand for homes, and therefore home prices, high. The weak national economy has helped reduce the premium to buy for the time being, but where the labor market is relatively healthy, home prices are predicted to shoot up.
In Minneapolis, for example, where large companies including Target ( TGT - news - people ) and General Mills ( GIS - news - people ) have their corporate headquarters (and there's a large university system), home buyers will only pay 14% more than if they were renting (24 percentage points lower than average), and home prices should climb by 15% in five years.
Similarly, in Washington, D.C., government jobs are plentiful, and anticipated to stay that way. The 6.1% unemployment rate here is well below the national average, which is partly why Moody's anticipates a five-year jump in home prices of 15%. And, at the moment, the premium to buy is 20 percentage points lower than its usual 57%.
Of course, whether buying or renting is best is ultimately an individual choice, and one driven by a lot more than map coordinates. When subprime lending was rampant, many without the means to buy were encouraged to do so anyway--and it's no secret how that turned out.
"If there's anything we should have learned from this housing cycle, it's that the decision to buy or rent ought to be a personal lifestyle decision," says Witten. "In part, it's a question about, 'Do I want to be a homeowner' in general, and specifically, 'Do I want to be a homeowner now, with this economic uncertainty?'
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