Wednesday, August 16, 2006

Did You Hear That? It's The Sound of a Renter's Nightmare

Yesterday felt very reminiscent of 1997. Recently, I met with a client over drinks, and she mentioned that she didn't understand how the housing rental market tightens up and slows down.

When more people can afford to purchase homes, there is less demand for housing rentals, so prices adjust accordingly. Conversely, when money becomes expensive to borrow, meaning interest rates on borrowed money (home loans) increase, fewer can afford to purchase homes and the rental market maintains a steady pace due to continued demand.

The rental housing market in San Francisco is reaching a point of high demand. Interest rates on loans are holding steady at the moment, but rates are still higher than they have been in the last two years. In addition, buyers looking at the lower end of the housing market are facing future uncertainty with some of the risky loans , such as interest only loans or 3 to 5 year adjustable loans, which allow them to enter the housing market. Many such buyers are staying put in their rental housing.

So begins the Renter's Nightmare. On Monday I posted a 1 bedroom apartment for rent, with an open house to show it yesterday. There was a line at the main entry when I opened the door, I received 11 applications in 1 hour, and enough hints of possible bribing and personal stories from strangers to hold me until the next vacancy. Which most likely, will probably be a long way off.

For the entry level home buyers that are still ready to buy, there is good news. Inventory on the lower end of the market has increased significantly in the last quarter, offering new opportunities by way of pricing rather than risky loan tactics. Additionally, rates for fixed loans are holding steady at nearly the same rates as adjustable loan rates. Because the market has slowed, sellers can be less picky about what type of financing is chosen by the purchaser, which means that a no money down or 5% down offer could still seal the deal.

Have more questions about buying or selling real estate? Ready to buy or sell a home? Contact me today for honest, experienced answers.

Amy Blakeley
Realtor®
(415)296-2173 Direct
ablakeley at mcguire.com
www.amyblakeley.com

Wednesday, August 09, 2006

Remodeling in a Transitional Market

The San Francisco real estate market has ebbed from Real Hot to Real Weird, with some great properties sitting and others receiving 5 offers the evening of the first Sunday open house, such as 137 Beulah. That being said, investors as well as home owners looking to improve homes and come out on top when they re-sell, need to take caution in their upgrading ideas. Realtor® Magazine has the following helpful tips:

Daily Real Estate News July 31, 2006
Remodeling: Home Owners' Seven Deadly Sins

Remodeling isn’t always a good idea, says Holly Slaughter, brand manager and
consumer-experience expert for RealEstate.com.

Here are what she calls the seven deadly home-improvement sins to consider before committing to projects that may work against you and lessen your resale value.
• Over expanding. Outdoing all the homes on the block is never a good idea because it makes the house more expensive than the others and therefore harder to sell.
• Making your home into something it’s not. Changing the style or the architecture is usually a big mistake.
• Changing the purpose of a room. Keep kitchens as kitchen and baths as baths. They were built that way for a reason.
• Under budgeting. People routinely under budget 20 or 30 percent fewer dollars and underestimate even more in guessing the time the job will take.
• Doing the job yourself. Unless you have first-rate skills, hire somebody who does.
• If it’s not broke, don’t fix it. Don’t waste money on renovations that won’t pay off. Buyers won’t necessarily pay for what makes a seller happy. Siding, windows, kitchens and bathrooms are the home improvement winners, according to Remodeling magazine.
• Neglecting regular upkeep. They may seem boring, but cleaning the gutters, keeping the house painted and trimming the shrubs are the most valuable home improvements.

Source: Marketwatch, Amy Hoak (07/30/2006)

Ready to buy or sell a home? Have questions about the current San Francisco real estate market? Contact me today for honest, experienced answers.
Amy Blakeley, Realtor
®
McGuire Real Estate
ablakeley at mcguire.com

www.amyblakeley.com