Welcome to the Neigborhood

We've been touting the evolving Divisidero corridor for a couple of year now. It may still be a bit gritty for some folks, but the neighborhood has vitality and genuine diversity more reminiscent of Brooklyn than the Mission district. From a real estate perspective, we think values already reflect the area's future more than its past. In other words, it's probably too late to bet on the come. But if your goal is to live in an exciting, vibrant, true urban neighborhood with decent weather and access to Golden Gate Park, you'd be hard pressed to do better. So the next time you're cursing the traffic as you travel from the Marina to Noe Valley, consider just parking the car and walking. You may be pleasantly surprised by what you find.

Taxing Situation

Most people don't realize that there can be tax consequences to a short sale. Just when you think you've gotten out from under an unfortunate financial situation, you may find that you have a substantial tax bill. Today's Chron article spells out the pitfalls that may sellers are completely unaware of.

School of Thought

If you aren't raising children in San Francisco, this story might not seem like a big deal. But if you or someone you know has young 'uns in Baghdad by the Bay, then you know that the public school selection process is one of the single most important issues in town.

What's the real estate connection? The school board's decision to grant partial neighborhood preference could well have some impact on property values for homes near the most desirable schools. Of course, if the board had granted full neighborhood preference, the impact would have been huge.

In Marin, schools are a driving force behind property values. In San Francisco, schools are often a driving force behind people moving to Marin. Will the board's decision stem this tide? Time will tell. Did the board's decision only serve to further segregate SF's public school or did they not go far enough? We'd love to hear readers' thoughts (real estate-related or otherwise) on this very divisive issue.

Helping or Hurting?

Missed this one a few weeks ago, but it's worth a trip back in time. New appraisal guidelines are making it harder than ever to get financing for a home purchase. These days, anti-reform and anti-regulation stances are less popular than ever, but reform for reform's sake can backfire.

In our sphere, we've heard innumerable stories of local appraisals being done by out-of-area appraisers. (Mill Valley house, Sacramento appraiser. San Francisco condo, Morgan Hill appraiser.) We talk often about the importance of working with a Realtor who really understands a local market. Well, that wisdom gets severely compromised when an out-of-area appraiser can step in and blow up a transaction.

So is this a good thing or a bad thing? Are regulators protecting us from ourselves or are they preventing the market from recovering?

The Biggest Investment That Isn't

Apropos of today's earlier post, we were thinking about the conventional wisdom that one's home is usually one's largest investment. In light of the number of people walking away from their "largest investment," it's worth asking...if a person buys a home with zero down and an interest-only loan (as was the case for more than a few buyers during the boom time), is it really an investment at all? The only thing the buyer is risking is his credit score. There's no judgement or political statement implied by the previous sentence. Just an observation meant to spark debate.

Who's At (De)Fault?

An interesting article in today's Chron raises the questions about what happens when defaulting on debt no longer carries much of a stigma. Up to 25% of foreclosures are occurring because homeowners simply walked away from their home; something what was all but unthinkable for previous generations. For those with a talk radio viewpoint on this subject, the piece makes the notable point that it's not just individual homeowners who are walking away from financial obligations. Developers are abandoning multi-million dollar projects. And, of course, we all know about the Wall Street bailouts, which resulted from similarly reckless behavior, with consequences softened only by the government's golden trampoline. We'd be interested in hearing what readers think about everyone from homeowners to Wall Street brokerages getting into trouble from which they cannot recover. Has fiscal accountability become a national afterthought? And if so, is this a temporary phenomenon or a permanent shift in how Americans view debt and risk? Can the shame of being a welsher ever be recaptured? (I'm one quarter Welsh, so I think I can use that word.) Should it be?

Money Train

Another update on the progress of the SMART train. In case you're wondering why we keep reporting on this story, we believe that the SMART train (whether it makes it to the station or not) will have a big impact on North Bay real estate.

Clean Bill of Health

In possibly the least shocking news story of the year, Marin was recently ranked as as California's healthiest county. It's a very nice sustainably harvested feather in our organic hats. Laugh all you want, but these are the things that help real estate values. We plan to celebrate with a Double Double and a side of fries.

Rubber-necking Real Estate

Sometimes it's hard not to look. If you're curious to know more about foreclosures in Marin, check out the IJ's forclosure database. Please note, however, that while this information is public, it's also personal. Let decency prevail. You should also know that many home listed as "in the foreclosure process," will never become bank-owned. These days, most people attempting to do loan modifications are being advised to go into default on their mortgages. This starts the foreclosure process. In many of these cases, the lenders will modify the loan before the house is reposessed and the owners will remain in possession.

What's Your Point?

In today's Chron, various parties weigh in on what will happen to mortgage rates in the coming months. Of course, to borrow from William Goldman, "Nobody knows anything." Nevertheless, speculation that rates could jump as much as a full point should give some pause to anyone with a stake in real estate. Higher rates usually mean falling values. With apologies to Mr. Goldman, one thing we do know is it's going to be a very interesting year in real estate.

Posted by Jess Pearson

Rising Tide?

If a rising tide lifts all ships, then what do rising interest rates do? Unless, like us, you assiduously avoid television news and talk radio, you've already heard about Fed Chairman Bernanke's comments regarding eventual and inevitable increases in interest rates. Here's the article about it in the Times. When rates go up, lots of things will happen; some bad and some good and all depending one your point of view. But they won't all happen at once and they won't all happen right away. One thing we think we can say with relative confidence...if you're thinking about buying and you plan to hold on to your investment for a good long while, this might be the time to act. Conforming loan rates are under 5%. Even if prices fall, higher rates will mean higher cost of ownership over the long haul. Unless you're a cash buyer, you may look back on Q1 of 2010 as that rare moment when prices and interest rates were both low.

Orange You Glad I Didn't Say "Termite?"

Some of you know that we're huge fans of the San Francisco Giants. If you're like us, you love to listen to their games on the radio. And if you listen, then you know that the Giants' flagship station, KNBR, runs a lot of ads for orange oil termite treatment. We've heard mixed reviews about orange oil, so we were happy to see a little Q&A in the Chron this week. We can't promise that this is totally accurate (it is the Chron, after all), but at least now you know more than you did before (or ever wanted to?) about orange oil.

Default Setting

Marin IJ or SF Chron: two sources for the same info. Notices of default were down last quarter, but we're not ready to draw any conclusions yet. There are too many forces at play in the marketplace right now to say whether a trend can sustain.

More on the SMART Train

The IJ had another update on the SMART train. Looks like a modified route is a possiblility. From where we sit, it's hard to get behind any option that doesn't include a connection at the Larkspur Ferry Terminal. How do other North Bay residents feel?

Slow Train Coming?

For those who missed it, here's an update on the SMART Train that will connect Marin and Sonoma Counties.

Posted by Jess Pearson