THE SECOND STORY | March 26th, 2020

Communications from those who want to know….

Cloud formations at Alameda Point, today.

……what’s going on with the real estate market (aka with the Corona Virus pandemic)?

I tell folks that I don’t read crystal balls…I don’t pretend to know what the future will bring….and while we can learn from the past….I have no idea how this will shake out.

I do give them items to think about….

-Buyers: How long do they anticipate living there? Is there a chance that  they could lose a job (income)? Is there a chance that they could go through a job transfer to other areas, states? What happens if what they bought loses value, for whatever reason?

-Sellers: Why are they moving? Would it be better to rent out where they now live, instead of selling it? Do they want to downsize? Right-size? Get a single level house/townhome/condo? Do they need to consider an IRC 1031 exchange if they rent out that property now, does it have units that generates income? Cash-out? Leave on a boat and never come back?

I was selling Alameda real estate when we had the earthquake, when we were attacked on 9/11, when the Oakland hills fire decimated everything, and of course when the financial fiasco hit (2008).

Just some things to think about…..

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Definitions:

MLS=Multiple Listing Service 

AC= active contingent (the buyer needs to sell something before s(he) can complete the transaction. In this instance, another buyer might write a back-up offer. If the primary buyer can’t meet the contract deadlines, it’s bye-bye to the first buyer. And the back-up offer moves into the primary position. Be sure your agent explains all of this to you! You do NOT want to lose your deposit to the Seller.)

BOM=back on the market (could be that the buyer had some conditions in the contract that s/he couldn’t meet in a timely manner).

PCH= price change (seller either raised or dropped the price)

PSB=pending sale (seller & agent wants backup offers)

REO=  Real Estate Owned by the lender (The seller may have stopped paying the lender, was behind a few months, etc. It’s a foreclosure!)This the first time in years that I’ve added this to our list!

Alameda Real Estate this Week

Active listings 30 including 4 BOM

Pending listings 7

Sold 15

One of the things that I’ve noticed these 2 plus weeks, is that I smile at strangers more in these troubled times. And they smile back, genuinely.   We are all working through this together. And I don’t want to lose sight of that.

Get a hold of me if you have questions and/or comments.

Best, marilyn

 

 

THE SECOND STORY | March 24th, 2020

Showing Procedures During Covid-19

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During these unsettling times, sellers and buyers are concerned about staying healthy and virus-free as we all are. To keep all parties safe, new procedures should be considered regarding the procedure for showing houses.

Agents are reporting that they are selling homes where the buyers have not physically been in the home and base their decision on the virtual tour found online. Some states have suspended showings because they are not considered essential services and other states have not addressed the subject.

In the spirit of stepping up to do what is necessary, the following suggestions should be considered:

  • Buyers should view the pictures online first to see if the home meets their needs. Most listing agents upload enough pictures to get a good idea of what a home looks like.
  • Buyers should ask their agent questions that the photos don’t address. Then, their agent can go through the listing agent to ask the seller direct.
  • It may be possible for the agent or owner to do a Facetime walk-through which would allow the buyers to ask questions and direct the agent or owner where to point the camera.
  • When possible, buyers can make an appointment to see the home through their agent. They should meet the agent at the home in their own car. No children should attend showings.
  • Recommended safe distances will be maintained between the owners and listing agent, if present, the buyers and their agent.
  • Transfer is almost inevitable, and all precautions should be taken. Buyers should carry their own sanitizing wipes and or gloves and avoid unnecessarily touching surfaces. Allow their agent to open doors and cabinets.
  • They should be disposed of in a trash bag in their car after they exit the home.

The social distancing and isolation could present some buying opportunities due to a lack of competition. At the same time, the lack of inventory in many markets could keep prices high. Overall, home prices nationwide are stable and, in many cases, continuing to rise which makes it a far less volatile alternative to investing in the stock market.

With mortgage rates being at historic lows, there will probably never be a cheaper time to finance a home.

Thank you again for looking at our listings and let us know if we can help you in anyway.

Please stay safe; wash your hands; practice social distancing and follow all the guidelines necessary to promote good health. We’re all in this together!

THE SECOND STORY | March 19th, 2020

It’s a bit weird in the real estate world…..

….and in the whole world. But somehow the weirdness brings out the best in people. I think folks are kinder and smile more readily (even with the face masks on).

 

The above is a sign on the third floor of Alameda’s City Hall. It’s not always so calm up there….but I took the photo over 5 years ago. Now it really means something. May you find peace, calm, satisfaction, and wellness in all parts of your lives!

Needless to say, clients, potential clients, friends and neighbors, are calling, em, texting, stopping me in the stores, and want to know what is happening in our local real estate world. I spoke with a couple this morning (we tried Zoom, but couldn’t get it to work), so we just used our phones.

My response to these folks is: I can’t predict the future. I’ve been through a few of these man-made and/or nature-made events over the years. I may be able to tell my clients various scenarios of what may happen…but there is NO guarantee.

Most of us, in compliance with Gov. Newsom’s order, won’t be holding any properties open, even for the broker tour.  And that’s a good thing!

That doesn’t mean that an agent can’t open up a vacant house and show their buyer(s). They can.

BUT…should an agent ask permission to get into an occupied house? NO! Who would want a stranger inside of their property….even if they’re desperate to sell it? Under today’s circumstances…no way!

In fact, I think this Coronavirus will change the way MOST real estate agents will do business, even after it’s left our lives.

I never show a property unless I have a meeting with the potential clients at a Starbucks, Peet’s, Blue Dot, Wes Cafe, etc.  We have a chance to ask questions of each other, and then we’ll make a decision whether to work together, or not.

Most of my clients come from referrals, not me door-knocking, not me rounding up and hounding people at open houses.

ALAMEDA’S REAL ESTATE MARKET THIS WEEK

Definitions:

MLS=Multiple Listing Service 

AC= active contingent (the buyer needs to sell something before s(he) can complete the transaction. In this instance, another buyer might write a back-up offer. If the primary buyer can’t meet the contract deadlines, it’s bye-bye to the first buyer. And the back-up offer moves into the primary position. Be sure your agent explains all of this to you! You do NOT want to lose your deposit to the Seller.)

BOM=back on the market (could be that the buyer had some conditions in the contract that s/he couldn’t meet in a timely manner).

PCH= price change (seller either raised or dropped the price)

PSB=pending sale (seller & agent wants backup offers)

REO=  Real Estate Owned by the lender (The seller may have stopped paying the lender, was behind a few months, etc. It’s a foreclosure!)This the first time in years that I’ve added this to our list!

33 Active 

Click Here to View Listings  

49 Pending

Click Here to View Listings

11 Sold

Click Here to View Listings

OK. That’s my 2 cents worth for now.

Stay calm, cool, and do something great for your neighbor(s)! Even if that just means checking in with them, in person!

best, marilyn

 

THE SECOND STORY | March 17th, 2020

Why have a mortgage during retirement?

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You don’t have to watch TV for long before Tom Selleck, Henry Winkler or Robert Wagner will tell you why seniors should consider a reverse mortgage. However, there are a seniors who are resisting the conventional wisdom of having their home paid for and opting for a mortgage with payments on their home.

In some cases, seniors will downsize into a smaller home and have a large amount of equity to pay cash for the new home. In other situations, they may have their home paid for and decide to do a cash-out refinance which will require making payments.

The logic behind either of these examples could be motivated by the fact that since mortgage rates are so low currently, the owners can reinvest the money at a higher yield and make money on their equity. This will give them more money for their retirement income.

A common question that is asked by owners considering such a strategy is whether they’ll be able to qualify for the new mortgage since they may no longer be employed. The Equal Credit Opportunity Act prohibits discrimination against borrowers based on age.

All borrowers, whether they are working or not, need to show that they have good credit, reasonable debt and enough stable income to repay the mortgage. Lenders cannot base their decision on loan term based on an applicant’s life expectancy, so a 30-year loan is possible regardless of the borrower’s age.

Fannie Mae, one of the largest purchaser of mortgages on the secondary market, is concerned on income that is stable, predictable and likely to continue. Retirees’ income can come from Social Security, pensions, or distributions from retirement accounts like IRAs, 401(k)s, Keogh or other plans. Lenders will analyze these sources to estimate how long it will last.

Other investments can be considered like stocks, bonds, mutual funds and annuities. Based on the type and the volatility of the investment, lenders may be restricted from considering 100% of the income.

Getting the facts as it pertains to you as an individual is important to be able to know if you are eligible and how much you can borrow. A trusted mortgage professional who understands this type of borrower is very important to help you determine the right mortgage vehicle and provide information to decide if this option is right for you. Call me at (510) 908-9021if you would like a recommendation.

THE SECOND STORY | March 12th, 2020

Sunshine, sunset….


My friend and I go out bike riding on Monday’s, late in the afternoon, it’s dark when it’s winter. But it’s glorious when the time changes, in March.

I was talking to some friends this week, and they told me that we voted to get rid of Standard Time. WHA? When did that happen? They said we (CA) voted 2 years ago!

When in doubt, I look it up on google. So I did. And I found this statement from CA. Assemblyman Kansen Chu speaking:

“I am committed to ending the harmful practice of switching our clocks twice a year and delivering on the voter’s decision at the ballot box in support of Proposition 7,” said Chu. “I share voters’ frustration that we will be shifting back to standard time on Sunday. Unfortunately, California and other states cannot move forward with permanent daylight saving time without authorization from the federal government.

“In January, I will introduce an Assembly Joint Resolution urging Congress to authorize states to practice permanent daylight saving time and continue my work to pass Assembly Bill 7 so California is ready for when Congress decides to take action.”

California is one of 14 states this year to introduce legislation for permanent Daylight Saving Time.

There are also four bills waiting in Congress that could allow California and other states to make the time shift: H.R. 1556, S. 670, H.R. 1601, and H.R. 2389. Congress has until December 2020 to act on those bills.

On the list of important things…this may not be so high…but it is, and hopefully it will be! And get rid of the Standard Time Zone for Calif!

 

Alameda Real Estate this Week

Active listings 29

Pending 51

Sold 11

Have a great weekend!

best, marilyn

 

 

THE SECOND STORY | March 10th, 2020

Shopping for a Mortgage

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A lower rate will not only result in a lower payment, it will amortize the loan quicker. A $250,000 mortgage at 4.5% for 30 years will have a $1,266.71 principal and interest payment. At 4%, the same loan will have $1,193.54 payment saving $73.18 a month and the unpaid balance would be $1,776 lower at the end of five years.

Mortgage lenders tend to price their mortgages based on the credit score of the borrower. The higher the credit score, the lower the mortgage rate. There is an inverse relationship that the lower the credit score, the higher risk and therefore, a higher rate is needed to balance the risk.

In order to get a valid rate that will be available to you with your credit score, you need to be pre-approved. The process of making a loan application before you find a home, allows the lender to verify your credit, income, and ability to repay the loan. Lenders usually only charge the cost of the credit report for this type of service. Be aware that pre-approval is not the same thing as pre-qualification which is simply a loan officer’s opinion.

When you shop for a mortgage with multiple lenders, the credit bureaus count them as a single credit inquiry if they are done within a two-week period. On the other hand, restrain yourself from applying for other credit such as cars, furniture or credit cards until after you have closed on the purchase of your home because those inquiries can negatively affect your credit score.

The Consumer Financial Protection Bureau recommends that you let lenders know that you are shopping the mortgage for the best rate and fees.

Instead of going to the Internet and Googling mortgage lenders, start with recommendations for a lender from your real estate professional. They see the good, the bad and the ugly and can save you a lot of time. Another reliable source would be from a friend who has recently purchased a home.

There are lenders who bait unsuspecting borrowers with lower rates and fees into making an application and after critical time has lapsed, try to switch them to a different program. By that point, many buyers feel they don’t have any choice but to accept what is offered.

Another confusing factor is the way that loans are priced to the public. They are usually quoted at a rate with a certain amount of points. A point is one percent of the amount borrowed. An example would be a quote for a loan at 4.5% with 1 point or at 4% with 2.5 points.

The points combined with the rate affect the yield the lender will earn, and you will pay. A simple way to make this an apple to apple comparison is to have the lender quote the loan as a “par-value” loan with no points involved. Then, the lowest rate will produce the lowest cost to you.

Another way to compare loans will be to uses a financial app called Will Points Make a Difference. You can plug in the rate and points to calculate the lowest yield over a projected holding period or the full term.

The lenders do not want to make it easy for you to compare. Mortgage money is a commodity and shopping will be worth the effort.

THE SECOND STORY | March 3rd, 2020

Get Ready to Garage Sale

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A well-planned garage or yard sale can give you extra space in your home, get rid of unused items and make some money but it needs some of the same considerations that any business needs to be successful.

  • Start early to research and plan
  • Promotion is key
  • Display items attractively
  • Price items right
  • Organize checkout

Determine the date of your sale, remembering that there are exceptions, but Saturdays are generally the best day. Experienced garage-salers believe that a well-planned one-day event will do as well as a multi-day event. Serious purchasers will look for the “new” sale and most people don’t come back multiple days.

Recognize that the first day of the sale will have the most people. Everyone will be looking for a bargain but some of them actually want to purchase things for them to resell at their own sales.

Advertise in local newspapers and free online classified sites like Craigslist. If several families are going together for the sale, mention that in the ad; it will be a big draw. Mention your bigger-ticket items like furniture, equipment and baby items.

Garage sale signs can be purchased or you could have them made at Office Depot or FedEx Office. Signs need large lettering so they’re easy to read without too many words on them. Remember that people will be driving when they see them. Most important info: Garage or Yard Sale, address, date and time. Directional signs are also important along with balloons and streamers to attract attention.

Consider using the service Square so that you can take credit cards. The cost is 2.6% + 10¢ per swipe and you can do it on your smartphone or iPad. You’ll need to sign up at least two weeks in advance to receive your reader.

You will be amazed at what sells and what doesn’t. If your goal is to get rid of some things regardless, put those items in the sale and at the end of the sale, donate what you can to Goodwill and the balance goes to the dump. If you can’t bear to do that, box them up and try again next year or possibly, at one of your neighbors’ sales.

Other supplies you’ll need will be:

  • Labels and markers for pricing items.
  • Newspaper and clean, grocery bags to wrap breakables.
  • Tables to display the items.

Unless you’re having an estate sale, keep your home locked. You don’t want people wandering through your home while you’re outside. If you start to accumulate a lot of money, take some of it inside. Don’t discuss how much money you’ve made during the sale or how successful it has been.

People will want to bargain; it’s the nature of the game. Consider this strategy: less negotiations early in the sale and possibly, more toward the end of the sale.

THE SECOND STORY | February 28th, 2020

Good old days? Good new days?

I met a friend at Ole’s (Waffle Shop) a week ago. The restaurant has been in Alameda since 1927. My friend was greeted by name by most of the staff!

It was 11:45am and we both ordered breakfast. I’m a fan of their waffles.

 

When Carl and I showed up in Alameda, it was clearly a Navy town back in 1973. The Alameda Naval Air Station was going full blast. I’d never seen anything like A-town before.

We moved into a studio apartment on Central Ave., which was converted to units back in the 1940s, from a Victorian house. I’m not sure how many apartments were in that building.

When my parents drove from Newport Beach lugging a bunch of wedding gifts….they were rather shocked. No, mom and dad, this is NOT Newport Beach. My dad had a brother, who had a large family, and they lived in Piedmont. That’s more than a big step across the estuary!

These days it’s rather depressing about how many stores and shops on Park Street and Webster (and streets in between) have been shuttered and/or are left vacant for years. I get it…it’s a whole new world in retail. Order online…get your stuff/food right away. No driving, no parking your car.

It will be interesting to see what the city does….especially since there’s another big housing shortage, certainly in Alameda, and throughout the state. There is talk about getting rid of some zoning requirements: having 2+ ADU’s (Accessory Dwelling Units) in a backyard, lowering ceiling heights for basement areas to create living spaces.

NEW VIEWS! Just click on the links.  

Active listings 15 including 1 NREO, 2 PCH

Pending 13

Sold 5

(Please let me know if the links don’t work!)

I’ll be at 814 Ironwood Road (aka Bay Farm Island/ Harbor Bay Isle). Come by, say hi, take a look!

Best, marilyn

THE SECOND STORY | February 25th, 2020

What kind of properties are these?

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It is the way the property is used that determines the type of property it is, not what it looks like. Based on the intent of the owner, the property could be a principal residence, income property, investment property or dealer property.

A principal residence is a home that a person lives in. There can be only one declared principal residence. It is afforded certain benefits like deducting the interest and property taxes on a taxpayers’ itemized deductions, up to limits. Up to $250,000 of gain for a single taxpayer and up to $500,000 for a married couple filing jointly can be excluded from income if the property is owned and used as a principal residence for two out of the previous five years.

An income property is an improved property that is rented for more than 12 months. The improvements can be depreciated based on a 27.5-year life for residential property or 39-years for commercial property. This is a non-cash deduction that shelters income. When the property is sold, the cost recovery is recaptured at a 25% tax rate.

An investment property could be an improved property or vacant land that does not produce income and is not eligible for depreciation or cost recovery. The gain on both income and investment properties are taxed at a lower, long-term capital gain rate and are eligible for a tax deferred exchange.

Second homes are properties that a taxpayer primarily uses for personal enjoyment but is not their principal residence. For IRS purposes, it is treated as an investment property in that the gain is taxed at preferential long-term rates if it is held for more than 12 months. However, it is not eligible for exchanges because personal use properties are excluded from that benefit.

Properties that are built or bought to make a profit are considered inventory and are labeled dealer properties. The gain is taxed at ordinary income rates and they are not eligible for section 1031 deferred exchanges.

The financing available differs considerably based on the intent of the owner which determines the type of property. Owner-occupied homes, used as a principal residence, are eligible for low down payment mortgages like VA, FHA, USDA and conventional ranging from nothing down to 20%.

A second home, in most cases, requires a minimum of 10% down payment. Investment and Income properties, generally, require 20% or more in down payment with some possible exceptions. There is not any long-term financing available for dealer property.

THE SECOND STORY | February 20th, 2020

Why I love this town…

Even though Alameda is an island, and if (aka when) there’s an emergency and all of the bridges can’t be opened or crossed, and the tube is flooded with saltwater, I still trust that our citizens and guests can rely on each other. 

Why do I say that? Because I believe in people: all kinds of people. Down deep, I think people want to help others.

When I ride my bike around town….I’ll smile first and maybe someone will smile back: walkers, dog walkers, grumpy folks, babies being pushed in strollers by their nannies, mommies, daddies, or siblings. Even if I don’t get the ‘smile’ back to me, it’s okay.

        An issue that is right,  doesn’t gain impact by anger.

And if I take the time to listen, just listen, he, she, they may calm down.

I didn’t watch the full (wannabe) presidential debate last night, but it was a bit fascinating to me. Rich guys, young guys, older folks, ancient folks, women folks (neither of whom are filthy rich).

But our island city is getting more and more like the debates: yelling, interrupting. Folks, just try listening. It might be hard, but it’s worth trying.

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Definitions:

MLS=Multiple Listing Service 

AC= active contingent (the buyer needs to sell something before s(he) can complete the transaction. In this instance, another buyer might write a back-up offer. If the primary buyer can’t meet the contract deadlines, it’s bye-bye to the first buyer. And the back-up offer moves into the primary position. Be sure your agent explains all of this to you! You do NOT want to lose your deposit to the Seller.)

BOM=back on the market (could be that the buyer had some conditions in the contract that s/he couldn’t meet in a timely manner).

PCH= price change (seller either raised or dropped the price)

PSB=pending sale (seller & agent wants backup offers)

REO=  Real Estate Owned by the lender (The seller may have stopped paying the lender, was behind a few months, etc. It’s a foreclosure!)This the first time in years that I’ve added this to our list!

__________________

Broker Tour Tues 8

__________________

Active 27 including 1 BOM, 1 PCH

_________________

Pending 8

_________________

Sold 9

_________________

Market Stats for Active Listings (Days on Market)

High = 1022

Low = 7

Average = 125

Median = 22

__________________

Market Stats for Pending (Days on Market)

High = 8

Low = 0

Average  = 21

Median = 10

________________________

Market Stats for Sold (Days on Market)

High = 85

Low = 0

Average = 21

Median =10

Getting close to Daylight Savings Time!

Have a great weekend! marilyn