Factors affecting an investment property’s value

Investment Property Value Considerations

Property values will be determined taking the following variables in mind:

  1. Vacant Buildings.
  2. One unit currently owner occupied or vacant
  3. One or more units to be recovered for owner occupancy and/or extended family occupancy.
  4. Completely tenant occupied to remain that way (leased, month to month,  or protected rentals).
  5. Evictions already performed on the building creating a ‘tainted unit’.
  6. Ellis Act evictions on the premises.

In establishing marketing strategy, there are several options:

  1. Approach the tenant/tenants as buyers.
  2. If the tenant plans to move at any point in the future, be flexible with them on expected time lines, offer to help them with moving expenses, or wait until the unit becomes vacant.
  3. Wait to market the building until the tenant, or tenants vacate.
  4. Sell the building now at a value consistent with its income.
  5. Consult an attorney to explore your options.

Consider talking to an attorney who specialized in real estate law; particularly landlord-tenant law.  The City and County of San Francisco has implemented varied legislation over the years; sometimes in contradiction to each other.  Have a firm understanding of the impact of your tenancy on how you may market your building and in how you can use it after you own it.  If you need any resources for local attorneys, please don’t hesitate to reach out to me.

Moving checklist

The prospect of moving can be overwhelming, but it doesn’t have to be if you take it one bite at a time.  Please use the following checklist to help you guide you in your move preparations.

Recommendation:
Start preparing for your move just as soon as you can.  Collecting records, arranging your finances, and notifying your loved ones takes time.  Also, changing your address on your subscriptions often takes several weeks.

Before You Leave Your Current Address-Address Change

  • Give Post Office forwarding address.
  • Charge Accounts.
  • Subscriptions (notice requires several weeks).
  • Contact OneSwitch at (866)262-2816-all magazine subscriptions can be changed to your new address at no cost.
  • Friends and relatives.
  • Owners Manuals for items left in the house
  • Warranties for any items relating to the property
  • A list of area service providers, gardener, housekeeper, dry-cleaner
  • Garage door openers and keys
  • Code to alarm system and contact number of alarm company

Bank

  • Arrange credit references.
  • Cancel any automatic payment or direct deposit arrangements as appropriate
  • Transfer funds, arrange check-cashing in new city.

Insurance

  • Notify company of new location for coverage: Life, Health, Fire & Auto.

Utility Companies

  • Gas, electric, water, telephone, cable TV, garbage.
  • Get refunds on any deposits made.
  • Laundry, newspapers, changeover of services

Medical, Dental, Prescription Histories

  • Ask doctor and dentist for referrals; transfer needed prescriptions, eyeglasses, x-rays.
  • Obtain birth records, medical records, etc.

Pets

  • Ask about regulations for licenses, vaccinations, tags, etc.
  • Plan for transporting pets: they are poor traveling companions if unhappy.
  • Consult your veterinarian about moving your pet
  • Obtain your pets medical records

Packing Tips

  • Sort and get rid of things you no longer need-have a garage sale, donate to charity, or recycle.
  • Pack like items together
  • Decide what you will move yourself, and what you will have moved.
  • Don’t’ over-pack boxes
  • Put heavy items in smaller boxes so they are easier to lift.
  • Wrap fragile items separately and pad bottoms and sides of box.
  • Label boxes on multiple sides so they are easy to identify even if stacked.
  • Label where boxes are going so that they can be put right in the area they are intended.
  • Keep all moving documents and important papers together for easy and quick reference.
  • Back up your computer before packing.
  • Inspect furniture and boxes for damage as soon as they arrive.

Don’t Forget To:

  • Empty freezer; plan use of foods.
  • Defrost freezer and clean refrigerator. Place baking soda inside to dispel odors.
  • Have appliances serviced for moving.
  • Clean rugs & clothing before moving; have them moving wrapped.
  • Check with your Moving Counselor; insurance coverage, packing and unpacking labor, arrival day, various shipping papers, method and time of expected payment.
  • Obtain all personal records from lawyers, accountants, doctors
  • Check on deductible moving expenses if any
  • Arrange for storage if necessary
  • Have car checked and serviced for the trip
  • Plan for special care needs of infants and/or pets.
  • Carry enough cash or traveler’s checks to cover cost of moving services and expenses until you make banking connections in your new city.
  • Carry jewelry and documents yourself—or use registered mail.
  • Carry traveler’s checks for quick, available funds.
  • Let a close friend or relative know the route and schedule you will travel, including overnight stops; use him/her as message headquarters.
  • Let movers know how to stay in touch with you
  • Double check closets, drawers, shelves, etc., to be sure they are empty.
  • Assemble first-day items-soap, toilet paper, pencils, pager, toiletries, bath towels, utility knife, scissors, trash bags, etc..
  • Pack a day or two worth of extra clothing in case of delay
  • Leave all old keys needed by new tenant or owner with Realtor or your local contact.
  • Obtain certified check or cashier’s check necessary for closing real estate transaction.

At Your New Address:

  • Check on service of telephone, gas, electricity, water and garbage.
  • Check pilot light on stove, hot water heater and furnace.
  • Have appliances checked.
  • Have locks changed
  • Ask mail carrier for mail he/she may be holding for your arrival.
  • Have new address recorded on driver’s license.
  • Visit city offices and register for voting.
  • Register car within five days after arrival in state or a penalty may have to be paid when getting new license plates.
  • Obtain inspection sticker and transfer motor club membership.
  • Apply for state driver’s license.
  • Register children in school.
  • Arrange for medical services: doctor, dentist, veterinarian, etc.
  • Relax for a moment, you deserve it!

Packing tips and before you leave your current address-property you are leaving  inspired by Realtor online Magazine by permission of the NAR copyright 2003 all rights reserved

Starting/Stopping Utilities

Pacific Gas & Electric

(800)743-5000

www.PGE.com
AT&T (phone)

(800)288-2020

www.ATT.com

 

Comcast Cable

(800)945-2288

www.Comcast.com

 

Sunset Scavenger

(415)330-1300

www.SunsetScavenger.com

Bulky Item Pick-up

(415)330-1300

Hazardous Waste Pick-up

(415)330-1405

www.SFHazWaste.com

 

San Francisco Water Dept.

(415)923-2400

www.SFWater.org

 

Dept. of Motor Vehicles

(415)557-1179

www.dmv.ca.gov

 

Stop Junk Mail

(877)786-7927

www.StopJunkMail.org

 

Daily Newspapers
San Francisco Chronicle

(415) 777-1111

www.sfchron.com

San Francisco Examiner

(415) 826-1100

www.sfexaminer.com

How are closing costs split between buyer and seller

Closing costs are the moneys necessary to pay off all expenses incurred by buyer and seller on a property.  This will include an accounting of all funds spent and received in the transaction for both the buyer and seller.  Following is a partial list for items generally paid for by either buyer or seller in San Francisco.

Buyers:

  • Escrow fees
  • Title insurance
  • Loan fees, including points
  • Appraisal fee
  • One year’s hazard insurance premium (if not a condominium)
  • Deed recording fees
  • Notary fees
  • Prorated property taxes split between buyer and seller
  • Pre-paid interest to your lender
  • Prorated homeowners dues is you are purchasing a condominium.

Sellers:

  • Transfer tax
  • Real Estate agent commissions
  • Loans and loan fees (to close out existing loans)
  • Prorated property taxes split between buyer and seller
  • A portion of the taxable gain if above allowed limits
  • Prorated rents and security deposits if an income property
  • Deed and recording fees

The estimate of closing costs is generated when both the agents in the transaction, provided to the escrow officer that reflect the terms and conditions of the purchase contract.  The escrow officer will then compare the two sets of instructions and, if they match, the escrow holder will execute these instructions, disbursing funds and recording the deed which marks your ownership of the property.

Spare the air

 I’ve noticed in recent years that Spare the Air Alerts are happening a lot more often-that’s when air quality is poor and people are encouraged to stay indoors and reduce poluting activities such as driving and burning fires in the fireplace.

Rather than wait til it comes on the news, you can find out in advance by signing up for Spare the Air Alerts via email or phone.

Go to SparetheAir.org  to sign up and find out when not to use fireplaces, when your car should be left at home. Winter Spare the Air season runs from Nov. 1 to the end of February, although, occasionally, a Spare the Air event can occur outside those dates.

The best solution is to be thoughtful about air polluting activities everyday, by cutting down on car trips, carpooling, taking public transit and reducing the use of fireplaces.

The West Portal/Inner Parkside First Quarter 2015 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

2015 started out with a bang.  We see it almost every year because of a burst of post holiday energy; it’s amplified because buyers are in competition to buy the same properties. 

To give you a quick visual, I did a search for active single family homes for all of districts two and four, which cover all of the Sunset and from West Portal through to Sunnyside.  There is a total of 40 homes for sale in all price ranges.  That’s an incredibly small number. 

Most of the inventory I have been seeing has been from people moving out of town, or passing on.  There aren’t many move up buyers (who are also sellers) and I think this is a significant root of the problem to our lack of inventory. Faced with the need to sell their current property first and move into a rental while they look for a home is a daunting thought in a market short of inventory, with prices going up, competition and the need to get financing, that’s a pretty big leap of faith.  Most people give up on the thought.

As for market specifics in West Portal/Inner Parkside:

  • At the close of the first quarter of 2015, we had one active, four pending and eight sold. Of the eight sold, all eight received multiple offers and sold over their asking price.  The amount of the overbids are a big range, from as little as $66,000 to as much as $375,000.  There is no rhyme or reason to the amount of an overbid; it is  dependent on the list price and the amount of interest in the property.
  • Eight sales in the first quarter seemed very low to me, so I went back ten years to see if I could find a trend.  About half the time, the first quarter has been below 10 sales, the rest has been over; given the historical data, eight seems reasonable to expect.
  • Of the eight sales, only one was reported as all cash (meaning no loan on the property); compare that to the first quarter of 2014, where five of the 15 sales reported all cash.  I am hearing of more transactions with financing, so perhaps cash is saved for only the most in demand properties.
  • A few interesting ‘apples’ on the market in the last quarter, meaning properties that have sold in the recent past.  One on Ulloa that sold in 2004, sold for $800,000 more in 2015 and another on 18th Ave. No of Ulloa that sold in 2013 for $633,000, benefited from a significant makeover and sold for over $1.5 million in 2015.
  • For typical West Portal/Inner Parkside homes, which have two bedrooms and a bath up and rooms down, I didn’t see fluctuation in prices from quarter to quarter.  Part of that was hampered by the specific inventory we had to compare.
  • North of Ulloa usually gives us a better sample, because there are more sales in that area over the course of a year.  From the end of 2014 to the beginning of 2015, appreciation was about five percent, and year over year it was about 16 percent.
  • List prices have stayed the same or gone down a bit, leaving some room for buyers who expect to overbid.

Eric Castongia, Residential Sales Specialist at Zephyr Real Estate (BRE Lic. No. 01188380) provided the information in this article. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

West Portal Property Values-Spring 2015

2015 property values in West Portal / Inner Parkside San Francisco, CA

2015 started out with a bang. We see it almost every year because of a burst of post holiday energy; it’s amplified because buyers are in competition to buy the same properties.

To give you a quick visual, I did a search for active single family homes for all of districts two and four, which cover all of the Sunset and from West Portal through to Sunnyside. There is a total of 40 homes for sale in all price ranges. That’s an incredibly small number.

Most of the inventory I have been seeing has been from people moving out of town, or passing on. There aren’t many move up buyers (who are also sellers) and I think this is a significant root of the problem to our lack of inventory. Faced with the need to sell their current property first and move into a rental while they look for a home is a daunting thought in a market short of inventory, with prices going up, competition and the need to get financing, that’s a pretty big leap of faith. Most people give up on the thought.

As for market specifics in West Portal/Inner Parkside:

  • At the close of the first quarter of 2015, we had one active, four pending and eight sold. Of the eight sold, all eight received multiple offers and sold over their asking price. The amount of the overbids are a big range, from as little as $66,000 to as much as $375,000. There is no rhyme or reason to the amount of an overbid; it is dependent on the list price and the amount of interest in the property.
  • Eight sales in the first quarter seemed very low to me, so I went back ten years to see if I could find a trend. About half the time, the first quarter has been below 10 sales, the rest has been over; given the historical data, eight seems reasonable to expect.
  • Of the eight sales, only one was reported as all cash (meaning no loan on the property); compare that to the first quarter of 2014, where five of the 15 sales reported all cash. I am hearing of more transactions with financing, so perhaps cash is saved for only the most in demand properties.
  • A few interesting ‘apples’ on the market in the last quarter, meaning properties that have sold in the recent past. One on Ulloa that sold in 2004, sold for $800,000 more in 2015 and another on 18th No of Ulloa that sold in 2013 for $633,000, benefited from a significant makeover and sold for over $1.5 million in 2015.
  • For typical West Portal/Inner Parkside homes, which have two bedrooms and a bath up and rooms down, I didn’t see fluctuation in prices from quarter to quarter. Part of that was hampered by the specific inventory we had to compare.
  • North of Ulloa usually gives us a better sample, because there are more sales in that area over the course of a year. From the end of 2014 to the beginning of 2015, appreciation was about five percent, and year over year it was about 16 percent.
  • List prices have stayed the same or gone down a bit, leaving some room for buyers who expect to overbid.

 

Eric Castongia, Residential Sales Specialist at Zephyr Real Estate (BRE Lic. No. 01188380) provided the information in this article. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service and Eric’s observations in the marketplace. Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

What do you mean when you hold title to a property?

The way you own a property is called vesting, or holding title

 

The form of ownership chosen in your purchase, known as the vesting (holding title), will determine who may sign various documents and future rights of the individuals in the transaction; it can have an effect on one person buying as well as multiple people. You may have already heard some of the terms, joint tenancy, community property, tenants in common, sole ownership, or held in trust.

These rights associated with each type of vesting involve such matters as: real property taxes, income taxes, inheritance and gift taxes, transferability of title, exposure to creditor’s claims and significant probate implications in the event of death.

Before you can close escrow (or get loan documents), you must have selected a method of ownership.  Please get started on that process as soon as you begin the search for property.  Living trusts for instance, can take months to set up, so your preparation is important.

I urge you to speak with your attorney and/or tax advisor as soon as possible for vesting questions.  Your advisor may make recommendations which require partnership agreements, trust documents, wills, or other such documents.  Since these decisions and the accompanying documents may take time to be generated, I urge you to start this process immediately so that they may be accomplished prior to close of escrow.