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Serena's Blog

By Serena Russell | Agent in Hayward, CA
  • What kind of market was 2010?

    Posted Under: Market Conditions in Fremont, Home Buying in Fremont, Financing in Fremont  |  December 23, 2010 5:24 PM  |  1,110 views  |  No comments

    Does anyone know if it's a sellers market or a buyers market?  Have we hit bottom? Are we hydroplaning?

    It's a   fine line where there is not clear answer really.

    In 2010 short sales seems to be on the rise, with bank owned properties still available, but not as plentiful as in2008 and 2009.  This means increased activity over a longer period of time for buyers & sellers.  More intense negotiations in some cases.  Properties receiving multiple offers, with a great number of buyers backing out and listings going back on the market.  All in all, it's been pretty tumultuous for brokers, agents, and real estate professionals in general, and all the departments and other entities that support them.

    Take for example the escrow companies, inspectors, & appraisers who start working on these short sale files.  Many hours spent with sometimes no apparent resolution. On the other hand, 2010 seems to have been a year when lenders have gotten a better handle on the short sale process, and some of them even streamlined their office staff and trained additional personnel to handle short sale negotiations.  The situation is a new beast that no one was familiar with and not knowing which way it would trample.

    It's taken a while for banks to discover that ACTING is better than REACTING.  However in this discovery period banking institutions have tightened the reigns on the lending process causing escrow periods to increase from the normal 30-day escrow to a 45, 60 or even 90 days escrow.

    So ultimately it's not even a buyers or sellers market.  It appears that 2010 was a lender market for the most part.

    Let's see what developments are headed our way in 2011.

    Wishing you a HAPPY NEW YEAR and a prosperous one!!!

  • How long should I plan to stay in my new home?

    Posted Under: General Area in Union City, Market Conditions in Union City, Home Buying in Union City  |  December 21, 2010 1:50 PM  |  894 views  |  No comments

    The world is changing and so are the cyclical nature of the economy. Historically, the longer you lived in your home, the better it would be for equity building and tax advantages.   Pay close attention economic conditions. Are jobs increasing or decreasing in your target area?  Is the unemployment rate getting lower or higher?  Are home prices increasing or decreasing over a 3 to 6 month period?  Make the situation work for you. 

    mARKET CONDITIONS: Short sales and foreclosures are still available in most parts of the country, so once those go away,  the market will start to return to the buyers-recession state we were more familiar with.  Until then buyers will benefit from lower interest rates and declining home prices now than ever before.

    EQUITY: Some sellers might also benefit if they have owned the home for many years and have some equity in their home. This would make it possible for a seller to sell and make a decent profit. 

    INVESTING: Also take a look at what investors are doing?  If investors are out there buying up low priced properties, for cash, then it means it must be a good time to buy.  Buy low and sell high is always a good goal.   Investors generally pay a higher interest rate than owner occupied property owners, so they must make their money go farther.

    For more advise contact your well informed real estate specialist today.

  • "THE OFFER". What it is and how it works.

    Posted Under: Market Conditions in Fremont, Home Buying in Fremont, Property Q&A in Fremont  |  December 21, 2010 1:45 PM  |  721 views  |  No comments

      THE OFFER is actually a legal coontract often referred to as the 'purchase contract' or contract of sale.  It is a legal document for the purchase and sale of real property.  The initial offer  becoming binding when both parties agree to the terms in the document.  The quality of your offer is almost as important as the price you offer for the property.    Poorly written offers reflect badly on everybody and lessen your chances as a buyer to get your offer accepted.

    Here are 10 basic tips to guide you.

    1. Use the Correct Forms 

    2. Determine Price

    Your local Realtor can asssit greatly with items 1 & 2.  Online sites might give you an indication of how to proceed, but up-to-date information and market statistics are only generally available from your local Realtor or real estate professional. 

    Barring extreme buyers' markets or sizzling sellers' markets, you will probably want to offer a bit less than you expect to pay. You can ask for guidance, but don't expect your real estate agent to name a price for you. Picking buyer's prices is not an agent's job.

    3. Make an Initial Deposit

    In most states, to have a binding offer, you need to make a good faith deposit. It could be cash, personal check, cashier's check or other modes such as personal property, real property, mortgages or unsecured promissory notes.

    Spell out who will hold the deposit -- almost anybody but the seller!

    If your state has "liquidated damages," the seller could be entitled to retain your deposit if you default under the contract.

    4. Disclose your Down Payment

    Your down payment could be cash, promissory notes, stocks, real estate or other assets. Generally, it is readily available cash. Some states require verification of your down payment within a certain time period.

    5. Name Financing Terms

    Please remember that your deposit, when added to your down payment and financing should equal the total consideration paid. Disclose the type of financing you hope to obtain: conventional, FHA, VA, contracts of sale, assumption or other.

    6.         Include maximum points, especially if you are asking the seller to pay them.

    7.   Include Contingencies

    California Association of Realtors (CAR) purchase contracts in California give the buyer by default 17 days to do inspections. Other states are similar.

    Many contracts carry provisions for such contingencies as:

    ·            Appraisal

    ·           Loan Funding

    ·            Physical Inspections.

    ·            Depending on your state law, if you do not remove your contingencies in writing, they may still be in effect, all the way to closing!

    8.  Under when possession happens

    Is it  on closing? A day after closing?

    9.   Understand  Who Pays the Fees

    10.. Request Special Reports

    Your local Realtor can asssit greatly with items 1 & 2.  Online sites might give you an indication of how to proceed, but up-to-date information and market statistics are only generally available from your local Realtor or real estate professional. 

  • Multi-unit dwellings make more sense today

    Posted Under: Quality of Life in Oakland, Market Conditions in Oakland, Home Buying in Oakland  |  December 21, 2010 1:36 PM  |  1,430 views  |  3 comments
    Why buying a duplex -tri or fourplex makes sense today, multifamily dwellings are more affordable than SFR
    Most people buy their single-family house, live in it as their primary residence, and then consider buying their first investment property. For those that a re flexible and motivated I suggest buying a 2, 3 or 4 plex (also called multi-unit) as your first primary home. This property will become your first home and investment property at the same time.

    Example: A fourplex is a multifamily dwelling as a building that contains four self-contained  apartments and is intended for occupancy by four families. Either you live in a fourplex as an owner occupant or as an investment.
    These units are all self contained, utilities can be separately metered, and access to and from each unit is separated by stairs.  As an added bonus, each unit might contain an inside laundry room, or a common coin operated laundry room with washer and dryer.
    The owning of a fourplex, or any such multiple unit is truly one of the most under utilized ways of getting into real estate market, securing your future in many ways.
    Buying a fourplex is a better investment than buying a single-family home. Here are some of the reasons:

    1) Consider living in one unit and renting out the other units.  Use the proceeds to pay down the principal portion of the mortgage, while the equity is increasing.
    2.It’s easier to qualify for a first time homebuyer’s loan on a primary residence
    3.Rental income helps qualify.
    4.You need less money down.
    5. You could pay for your primary unit with the other thr ee unit’s cash flow.
    6.    When you decide to move you have a 4th unit that becomes a rental.
    7.    You now have a primary home and an investment in one transaction.
    Getting together with friends or family members, to share a fourplex makes sense.  Firstly, they are self contained, so there is no need to get into each others way; this is a better approach than renting, which as you can well appreciate, does not offer any returns at the end of the day.

    As an owner/buyer of who lives in one of the units, you have many advantages over a single-family home purchase. For example banks like to loan on owner occupied fourplexes, because they know that the mortgage payment will be coming from the other rental units and only partly from the owner occupied unit.  This will reduce the a mount that owner would need each month.
    With multi-unit investment properties your goal should be very clear…..CASH FLOW. Why is cash flow so important? Properties that can cash flow can survive all market cycles. I want you to believe that the fourplex is one of the fastest ways to achieve a stronger financial future.  In the end,  “it’s not how much you earn its how much you keep in your pocket”.

    And here is the most obvious reason of all,  in small residential income properties (duplexes, Triplexes and Fourplexes) the monthly cost if any units are vacant to the owner/investor.

    There are many such properties to choose from in the California bay area. The numbers may change, but the finally results will be the same.

    More advantages: You can write off some or large portions of your repairs.Cosult a tax preparer to give you details about the tax advantages of owning a rental property.

    Greater Cash flow every year: Over the years a multi family property will return a higher amount of money (increase in rents) than a single-family home, which will lead to a greater positive cash flow.  This combined with increase in equity will generate greater returns over a period of time.

    In today’s very affordable market,  many people are already doing this. In fact many younger people find that a small multiple dwelling is the ideal way for then to get started on building equity that will eventually afford them their own Single family home.

    Many older couples also find duplex inveWhy buying a duplex -tri or fourplex makes sense today, multifamily dwellings are more affordable than SFR
    Most people buy their single-family house, live in it as their primary residence, and then consider buying their first investment property.
     For those that are flexible and motivated I suggest buying a 2, 3 or 4 plex (also called multi-unit) as your first primary home. In today's market this is doable
    This property will become your first home and investment property at the same time.

    Example: A fourplex is a multifamily dwelling as a building that contains four self-contained  apartments and is intended for occupancy by four families. You can either live in the multiunit as an owner occupant
     or rent out all units as an investment. These units are all self contained, utilities can be separately metered.
    Most times, each unit will have its own separate entrance, inside laundry or common  coin operated laundry areas with washer/dryer.
     The owning of a   multiple unit is truly one of the most under utilized ways of getting into real estate market. Because it’s not well understood.  Actually, buying a fourplex is a better investment than buying a single-family home. Here are some of the reasons:
    1) You can live in one unit and rent out the other units. Use the rents collected to pay down the principal portion of your mortgage, while building equity.
    2. The multi- unit will be your primary residence as well as a rental.  It’s easier to qualify for a first time homebuyer’s loan on a primary residence.
    3.Rental income helps qualify.  And you need less money down.
    5. You could pay for your primary unit with the other three unit’s cash flow.
    7.  You can write off some or large portions of your repairs. .Consult a tax preparer to give you details about the tax advantages of owning a rental property.

    Getting together with friends or family members, to share a duplex,triplex or fourplex makes sense.  Firstly, they are self contained, so there is no need to get into each others way; this is a better approach than renting, which   does not offer any returns at the end of the day. 
    You now have a primary home and an investment in one transaction.
    With multi-unit investment properties your goal should be very clear…..CASH FLOW. Why is cash flow so important? Properties that can cash flow can survive all market cycles. I want you to believe that the fourplex is one of the fastest ways to achieve a stronger financial future.  In the end,  “it’s not how much you earn its how much you keep in your pocket”.
    As an owner/buyer of who lives in one of the units, you have many advantages over a single-family home purchase. Banks like to loan on owner occupied fourplexes, because they know that the mortgage payment will be coming from the other rental units and only partly from the owner occupied unit.  This will reduce the  amount that owner would need each month.


    There are plenty such properties to choose from in the California bay area. The numbers may change, but the finally results will be the same.  For a list of such properties, consult a local Realtor. Try to find someone who has experience with sales of multi units.
    In fact,  many buyers have zoned in on the low pricing and are  already doing this. Many younger people find that a small multiple dwelling is the ideal way  to get started on building equity that will eventually afford them their own single family home.
    Many older couples also find duplex investing an attractive and cost effective retirement dwelling and Income source. If you have children or grand children, this might also be a good way to get them started in real estate.
    So, why put your money in one residential unit like a single family dwelling if you can spread the risk among more units and create a better CASH FLOW for yourself?
    As an owner/manager of rental properties, I give you first hand experience. If you would like to make money in real estate, or if you are interested in buying a triplex, duplex, fourplex or any other multi-unit properties, or if you already own one and need to move on to another, please give me a call, or get in touch by e-mail.

     
     
    sting an attractive and cost effective retirement dwelling and Income source. If you have children or grand children, this might also be a good way to get them started in real estate.

    So, why put your money in one residential unit like a single family dwelling if you can spread the risk among 4 units like in a triplex or fourplex and create a better CASH FLOW for yourself.

    If you would like to make money in real estate, or if you are interested in buying a triplex, duplex, fourplex or any other multi-unit properties, or if you already own one and need to move on to another, please give me a call, or get in touch by e-mail.

     
     
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  • $10,000 CALIFORNIA HOMEBUYER CREDIT

    Posted Under: Market Conditions in Fremont  |  May 5, 2010 5:36 PM  |  359 views  |  No comments

    On March 25, 2010 California approved a new $10,000 First-Time Homebuyer tax credit for purchases that close escrow on or after May 1, 2010. (Cal. Rev. & Tax Code § 17059.1)

    These tax credits are available for taxpayers who purchase a qualified principal residence on or after May 1, 2010, and before January 1, 2011. Additionally, these tax credits are available for taxpayers who purchase a qualified principal residence on or after December 31, 2010, and before August 1, 2011, pursuant to an enforceable contract executed on or before December 31, 2010.  The purchase date is defined as the date escrow closes. Taxpayers may apply for the tax credits if they have entered into a contract before May 1, 2010, as long as escrow closes on or after May 1, 2010.

    However, taxpayers may not request a New Home Credit reservation if they have entered into the contract before May 1, 2010.

    $100 Million of tax credits has been allocated to First-Time Homebuyers on a First-Come, First-Served Basis.

    These tax credits are limited to the lesser of 5 percent of the purchase price or $10,000 for a qualified principal residence. Taxpayers must apply the total tax credit in equal amounts over 3 successive tax years (maximum of $3,333 per year) beginning with the tax year in which the home is purchased.

    The California Association of Realtors® predicts that it will take only 10 - 20 days to deplete the $100 million allocation for this credit.

    Time is quickly running out so act now.

    Check  this site for further details:  http://www.ftb.ca.gov/individuals/New_Home_Credit.shtml
  • MORE TAX CREDITS

    Posted Under: Market Conditions in California  |  April 4, 2010 10:12 PM  |  364 views  |  No comments
     

    The state has reissued the first time homebuyer and move up tax credit.

    Please understand this is not the Federal one. That still ends April 1, 2010.

    The new one is to start right after

    This works differently , it is still GOOD!   

      State bill AB 183 will provide $200 million for home buyer tax credits, allocating $100 million for qualified first-time home buyers of existing homes and $100 million for purchasers of new, or previously unoccupied, homes.

    The eligible taxpayer who purchases a qualified personal residence on and after May 1, 2010, and on or before Dec. 31, 2010, or who purchases a qualified principal residence on and after Dec. 31, 2010, and before Aug. 1, 2011, pursuant to an enforceable contract executed on or before Dec. 31, 2010, will be able to take the allowed tax credit.

    The credit is equal to the lesser of 5 percent of the purchase price or $10,000, in equal installments over three consecutive years. Under AB 183, purchasers will be required to live in the home for at least two years or forfeit the credit (i.e., repay it to the state).

 
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