Mission Fixer Finds Its Price

The feeding frenzy at 949 Hampshire in the Mission in early October wasn’t surprising: A large Victorian project house had just hit the market for $599,000. The property had been in the same family for many years, and was officially ready for its next owners.

The broker tour was overrun with couples eyeballing the possibilities for building sweat equity, alongside contractors taking measurements of various rooms. All the signs for potential value increases were there—large garage, four bedrooms, “good bones.” There was even a stove in the kitchen (above) to help the property pass the appraisal!

The listing office received six offers from three contractors and three “end users” who intended to fix up and live in the property. (The buyer turned out to be one such end user who lives in the neighborhood, according to the listing agent.)

 Hampshire closed last week for $740,000. So in case you’re wondering what you can expect to pay for property of this sort—that’s located somewhat on the outskirts of the Mission—now you know.

 

My Top 5 Condo Dealbreakers

You’ve spent three hours surreptiously looking at various real estate Web sites at work and have narrowed down your favorites for this Sunday’s open house tour.

The trouble is, three of those units have HOA dues that are well above what you can afford, and another two have serious pet restrictions.

Knowing the fundamentals about a condo and its HOA can save you time when it comes to targeting your search. I thought I’d put together my Top 5 dealbreakers to help all the buyers out there narrow down their prospects. Because let’s face it, you can only see so many homes between 2:00 and 4:00 on a Sunday:

1. HOA dues. This is a set amount of money paid monthly to the homeowners association. Dues typically help to cover costs such as building insurance, grounds maintenance, water, trash and property management. (They also sometimes cover earthquake insurance, but that’s another story.) The more amenities a building provides, the higher your dues will be. A South Beach high-rise with a fitness center, pool, and 24-hour doorman, for example, will have far higher HOA dues than that four-unit NOPA Edwardian. Read the fine print, and if the dues exceed your budget, move on to the next property.

2. Pet restrictions. I’ve lately come across some interesting pet limitations while searching for properties for my clients. One Pacific Heights condo building I checked out has a no-pets policy, another building in which I had a listing recently had a no-dogs policy. The most common pet policy in the San Francisco condo world is a two-dog or two-cat maximum. But you will often find weight restrictions, and in some cases, breed restrictions. So if you’re looking for a condo where you can live with your two Labs, make sure you don’t hit the buildings that prohibit them.

3. Rental restrictions. You may be intending to live in your condo for several years, but you might also eventually need a bigger space. And you may want to rent out that smaller home for additional income down the line. If that option is a must, it’s good to know up front whether there are any restrictions on renting your unit. One Nob Hill property that I visited for an investor client imposed a limit on the number of units that could be rented at one time; my client ended up passing because the ability to rent wasn’t a guarantee.

4. Outdoor space. If you absolutely need a garden or at least a deck, make sure the listing photos include a yard and specify that it’s shared. Outdoor space of any kind in a condo is a real selling point, and listing agents usually don’t miss the opportunity to show it if their condo has it.

5. Parking. Yes, the listing details note that parking is included. But is it deeded—or leased a block away for $300/month? Or is the parking tandem, meaning you’ll have to move your neighbor’s car out of the garage on a regular basis? Know your limitations, and if independent parking isn’t negotiable, skip the condos that specify anything less than that.

Zephyr iPhone App Boosts Buyer Searches

I’m proud to announce that my company, Zephyr Real Estate, has developed its own iPhone app. The Zephyr Real Estate Search rocks, letting you easily find all available properties for sale in San Francisco with an MLS-powered search.

It’s the only app that allows you to search by specific neighborhood in San Francisco, rather than just by zip code.  You can also search for homes near you, or set your own search criteria via the power of GPS. You’ll be able to see full details on every property, including full-screen photo viewer, detailed description and property features. You can also filter searches by neighborhood, bedrooms, bathrooms, parking, property type, price and more.

And if you create a MyZephyr account, you’ll get access to even more cool tools:

• See additional properties that are not available on public websites
• Search pending and sold properties
• Save searches and favorites
• Rate properties and make notes
• Share properties with friends and family via email or on Facebook
• Receive new listing and price reduction email alerts
• Create a custom multi-property driving tour with our exclusive Home Tour tool – perfect for planning your tour of Sunday open houses
• Your account is fully synchronized with your MyZephyr website account, so you can access all the same saved searches, favorites and notes whether using our app or logged on to the Web site.

So check it out and add some zing to your property searches!

Just Sold: Russian Hill TIC

I’ve just sold my 1BR/1BA tenancy-in-common (TIC) listing at 1145 Green #5. Listed shortly before Labor Day weekend, a very motivated buyer submitted an offer almost immediately and we were in contract within five days. List price was $439,000 and the sale closed at the asking price.

The unit is actually well on its way to becoming a condo, as the building won the condo lottery earlier this year.

Give me a shout if you’re looking for a similar property, or would like to sell the one you own. I’m well versed on the ins and outs of TICs, condos and everything in between.

“Streamline Moderne” on Sanchez Lands BOM

Noe Valley real estate junkies may recall 849 Sanchez coming on the market earlier this year—the house with the 1930s “Streamline Moderne” architecture atop Liberty Hill. The 4BR/3.5BA view home had an interesting, circular floor plan on the main level and two bedrooms (including a master suite) on the entrance level. It was listed at $3.4M in March and sold in 30 days for $3.2M.

Months later, the owners are now splitting up and have put the home back on the market (BOM) for $3.3M. (The extra $100,000 is thrown in to presumably cover selling costs.) That would be a hefty appreciation, yet nothing surprises me in Noe Valley these days. But it’s also important to note that 849 Sanchez sold in 2008 for $3.4M.

Leaning Tower of Day Street Still Available

The single-family home at 111 Day in Noe Valley has been kicking around on the market since mid July. It’s being sold through the foreclosure process and is listed at $825,790.

I’ve shown 111 Day to different clients, and we’ve all thought it has potential. Originally listed at $915,000, the 3BR/2.5BA property was sold for $900,000 in 2003. The house has its share of work to do (cracked ceilings and walls, windows in need of repair), and the kitchen could use an overhaul. There’s also a $14,000 termite report recommending various repairs. But in and of itself, 111 Day provides more space in a good location than many other comps and currently available houses nearby for the price.

I think there are two issues preventing buyers from sailing in with an offer. First off, there’s no yard—just a couple small decks, one of which needs to be replaced. 95% of Noe Valley buyers want yards for either kids or dogs. (I’m of the dog variety.) Secondly, as you can see from the above exterior photo, the building has settled and the turret on the righthand side is literally leaning and resting on the building next door.

The listing office has consulted a structural engineer, who’s recommended specific fixes that could address the defect. So if you’ve got your heart set on a Victorian in the nabe that has decent space and could benefit from some TLC, check out 111 Day. But make sure you include an inspection contingency so you can get a second opinion on the structural issue. Many San Francisco homes built at the turn of the century have settling issues, so this one may or may not be one that can be relatively easy to resolve.

New Eureka Valley Projects are Hit & Miss

Though financing for new condo projects is scarce these days, there are small-scale, new construction projects popping up in the neighborhoods. I toured two such developments recently in Eureka Valley and found different levels of appeal in each.

I loved the three condos at 412 Noe (above),  located between 17th and 18th Streets. Each feature 2BRs/2BAs with 1308 square feet and independent parking.  I was a fan of the extremely central location, as well as the stylish exterior and overall level of finishes. The top floor unit was my favorite, with its office area, skylights, and elevator that opens into the unit itself. There are also nice city views. List price for the top floor is $1,1,49,000. Pricing on the other two condos was $925,000 and $979,000. These seemed like good deals for new construction in Eureka Valley, of which there is not much.

I’m obviously not the only one who thought so, as all three units went into contract in less than two weeks.

The other project I visited was Dorland Homes, about which I was far less enthusiastic:

There are two buildings crammed on to one lot. The main building consists of two tri-level 3BR/3.5BA condos with balconies and private roofdecks, as well as one two-level unit with 2BRs/2.5BAs, private balcony and patio area. Two 2BR/2.5BA, two-story homes remain in the rear property, which also provides two private patios.

List price for the rear units are each $829,000, and the front units are listed at $989,000; $1,595,000; and $1,695,000.

I wasn’t thrilled with the outlooks from any of the units; as you can see in the photo above, a nearby housing complex is an inescapable element that’s not particularly attractive. The rear units essentially face the front building, so privacy is not something you can expect. I also found the rear units to be a bit narrow. HOA dues range from $450-$581/month, and there is no elevator. Parking is stacked, meaning there is a mechanical lift onto which you need to drive some cars in order for the other to park beneath them. I’m not a huge fan of stacked parking, as the mechanisms require maintenance that could be expensive down the line. But it’s one way for developers to provide parking for multiple units.

I’m thinking that the $1.6M and $1.5M asking prices on the larger units are a tad high. You can actually buy a pretty good house in the neighborhood for that kind of money. However, for those seeking new construction condos in a central location, Dorland Homes certainly fits the bill. I believe all five condos are currently available.

What You’ll Need To Get Loan Preapproval

If you’re intending to purchase a property in the next several months, it’s important to note what documentation you’ll need to provide to the lender in order to get loan approval.

Many prospective buyers cringe at the thought of pulling together reams of receipts, paystubs, and W-2s. But if you start doing that now, you’ll be ready to go in the event you stumble upon that perfect condo in  South Beach.

Here’s the list of documentation you will generally need in order to verify a home loan application, courtesy of my friends at Guarantee Mortgage:

1. Two most recent paystubs

2. W-2s for 2009-2010

3. Two most recent statements for all checking, savings, CD, money market and/or securities brokerage accounts

4. Most recent statement for all retirement accounts (IRAs, SEP-IRAs, 401ks)

5. Most recent statement of stock options, employee stock option purchase plans, etc. if part of the down payment or closing costs of a purchase

6. 2009-2010 1040s (federal tax returns, all pages)

7. Mortgage, real estate tax and insurance premium statements for all properties currently owned

8. Leases on all rental properties you may own

9. Divorce decree and settlement statement, if applicable

10. Name, address and phone number for your landlord covering past 24 months

11. Twelve most recent cancelled rent payment checks or bank statements if your landlord is a private party

12. Copy of your state-issued driver’s license or passport and your date of birth

13. Copy of current mortgage statements on all outstanding mortgages.

SF Market Heads Into Home Stretch

The third quarter of 2011 is under our belts, and it’s a good time to assess the current San Francisco market.

My response to the typical “How’s the market?” inquiry that I get from clients, neighbors and friends continues to be: “It depends where you’re talking about.” San Francisco has its fog/warm weather microclimates, and it also has real estate microclimates. Since the downturn of 2008, some neighborhoods have been moving along somewhat unscathed (Pacific Heights, Noe Valley), while others continue to take dives (Ingleside, Bayview). Additionally, certain price ranges have been going gangbusters, while others have dried up.

There’s still new development happening in the city, though on a smaller scale. Though we don’t have any big highrises in the works, a number of small-scale (i.e., four  to six units) new construction properties continue to hit the market. So funding for these projects has not diminished.

A total of 576 single-family homes sold in the third quarter at an average of $966,113. They spent an average of 61 days on market, which is far below that of the national or even state average. But the real news here is the fact that almost half of these houses sold in the $500,000-$1M price range. And only 159 homes sold above $1M.

There’s a similar story on the condo end of things. 504 condos sold in the last quarter, with 300 such properties selling in that same $500,000-$1M range. Only 68 sold above $1M. The average condo price? $711,029.

However, the luxury segment of the market has been relatively strong, despite the economy. For example, a $5,750,000 Nob Hill penthouse in “raw condition” changed hands recently and is now ready for the new owner to renovate. There were also a fair number of multi-million dollar cash sales that took place.

Sellers ended up withdrawing listings or letting them expire in a big way. A total of 286 houses and almost 400 condos fell into this category in the third quarter—a very high number for only a few months’ time. That means there are still many sellers out there who haven’t yet adjusted to the fact that their properties may not be what they believe they’re worth.

I’m seeing strong buyer activity heading into the fourth quarter, fueled by the low interest rates and healthy job market in the San Francisco area (particularly where tech companies are concerned). My prediction for sales numbers by year end is that they’ll be an improvement over 2010, but not by a landslide. We still have a few years to go before we emerge from the murky waters of the current real estate pond.

Most Expensive House of the Week: 2531 Washington

Sold for $100,000 over its $5.5M asking price in just three days, 2531 Washington in Pacific Heights closed escrow last week for $5.6M. That makes it the most expensive property sold on the market in San Francisco last week.

The 6BR/4.5BA, 5480-square-foot restored Victorian on a wide lot was completely rebuilt from the foundation up. It features twelve-foot ceilings on the main and upper levels, family room with doors opening to the terrace, plus a lower level with an office, additional family room with custom bar, and bedroom/bath. The property is located right off Fillmore, which makes it highly convenient, too.

2531 Washington was last listed in 2009 for $2.8M. It had been in the same family for more than 50 years, and definitely needed some updating. In January 2010, it was sold for $1,850,000—much more in line with the market. Depending upon how much was spent on the gut renovations, the $5.6M sale last week could be a good deal for the sellers. And the buyers? They’ve just purchased a top-of-the-line home that won’t need any work.