Ask Us: Should I Buy A Single Family Or 2-3 Unit?

Where readers ask and we (the community) try to answer:

Hello,

I have been following your blog with great interest. I have a comment/question and wasn’t sure of the best place to put it.

I was curious to know what you thought of something. Due to family circumstances, I would love to buy something in San Francisco, but something more along the lines of a 2 or 3 unit building. So, I am not just an investor coming looking to do a condo conversion in a year and then sell off again at a higher price. I plan on staying in there for a while, at least a few years and then depending on where I am at that point, renting it out to hopefully have it pay for itself.

It seems that sellers have the philosophy right now that they might not want to sell unless they get the price that they want (and the price they want is the price they would have gotten 6 months ago if they could). So, instead maybe some people are opting to hold on to their houses and rent it out until the market gets better and they could get a better price than right now? Do you see that happening?

If so, then it would seem to apply more to single family homes, no? Because rent-control laws don’t apply to them? But how about 2-4 unit buildings? It doesn’t seem right to apply this same logic to them, because both rent and eviction control laws apply to them, so either they sell at a lower price now (vacant but negotiated price), or a lower price later (because they might have tenants or even protected tenants).

I would be interested to know your thoughts! Anyways it will be interesting to see how it all plays out!

Cheers,
L

So many questions, such little space to answer. Check the comments below for answers from our insanely intelligent readers. Check your inbox for my reply directly to you, and check back here, because you touched on so many issues, we’re certain to keep coming back with more replies.

As always, thanks for reading and hanging out on theFrontSteps, and thanks for your question.

Road to Real Estate Recovery

When I was working at C__________, my boss was a big coke-head. As a result, the atmosphere was, to understate, lax. Everyone drank and ate copiously (never paying for it), sat down and/or danced randomly in the middle of the restaurant, swore, and slept with one another. All of the aforementioned took place during open-for-business hours. None of us were very surprised when an accountant appeared to “audit the situation” since the owners were confounded, and not at all pleased, that such a busy place could simply not turn a profit. The list of solutions thus generated included: uniforms, Michael Bolton CDs, crafting our famed sangria with boxed (as opposed to bottled) wine, and a NO DRINKING ON THE JOB POLICY.” Nowhere was it suggested that coke-head boss might… cut back, abstain, cease, or desist. And so ended my tenure at C_______.

The relevant thread here is that ailing businesses oft must look within to cure what ails. In the case of real estate, a national convalescent, such introspection cannot come too soon. Perhaps this is why Inman is sponsoring a “Roadmap to Recovery” program, part of which includes an essay contest, with prizes such as $500 and a free pass to the upcoming Real Estate Connect conference.

One recent essay asks how Realtors can redefine “full service.” The author, Jack Harper, has a thesis that what’s missing in real estate is transparency: a term he defines as the client having full understanding of what the agent does for his/her commission. He laments not only a lack of clear communication regarding those services, but also a lack of agreement by the industry as a whole as to what those services entail.

Commenters have opinions aplenty on this essay. Most turn out to be thinly veiled ads for the agents commenting, masturbatory “I am so good at this and that as well as that and this; and by the way, here is my contact information and website!” type stuff. But most of the ideas echo Harper’s.

As a potential client to any realtor, I would like to add that “transparency” also implies a level of honesty and freeness with information your industry is not famed for. We need to trust you again. Bringing that trust back to real estate could be one very important step on the road to recovery.

Photo credit: Active Rain.com

Google Founder(s) Vacationing In Mexico While Stock Falls?

We’ve been told, and we acknowledge this has absolutely nothing to do with San Francisco real estate (unless the Google founders took the Google bus to get to port), that one, if not both, Google founders are enjoying the fruits of their labor and declining company value with a nice cruise on their gigantic “dark sailboat yacht with three giant masts” down near Manzanillo, Mexico.

True or rumor? Anybody know? Admittedly, not as bad as the CEO’s of Ford, GM, and Chrysler flying to D.C. in their private jets asking for $25B, but interesting nonetheless.

We’re thinking “the dark blue yacht with three giant masts” is the Maltese Falcon (pictured above) on its way down to Panama. In which case, maybe Sergey Brin and Larry Page are just along for the ride, unless they threw down the $181,688,916 recently being asked for it, and added the yacht to their roster of extravagant things.

Either way, Sergey and Larry, you might want to go easy on the Lobster, and heavy on the beans and rice, things ain’t lookin’ so good up here north of the border.

Don’t suppose Jerry Yang is scrubbing the decks do you?

[Image Source: YachtPals.com]

Letter To Editor: “Defamation, Slander, Law Suit” Fun!

Life at theFrontSteps is nothing but sunshine and roses. Ummm, maybe not. Today, we give you the most recent friendly email to come our way, with a few things [removed] to protect privacy:

[Editor], It is unfortunate that I have to write you this email. A client of mine [removed] sent me this link to one of your blogs. Please know that if you continue to [post certain things] on-line, I will file a defamation of character and slander law suit in 5 minutes. You did not mention me by name, but have already affected my reputation [removed] with this blog. This is the most desperate and pathetic attempt I have ever seen by an agent to procure business. I could sue you right now based on the sales and records I have made [in the past]. Your implications are quite damaging and it will not be tolerated. Please remove these insulting and malicious comments off this site immediately or [your company] and you will hear from my attorneys before you can write another irresponsible, unresearched, innaccuate and unethical statement. By the way, you are using my photos for commercial use. Please cease and desist from this.

Sincerely,
[One upset agent]

And you thought this blogging stuff is easy, and always fun….

East Bay: Your Own Vineyard in Oakland (Yes Oakland)

By Home Girl

If you have ever flirted with the idea of having your own vineyard and harvesting a few decent cases of mellow wine every year, but a move to rural Napa or Sonoma seems too much of a leap, then have a look at this 4/3.4 updated ranch home at 5651 Colbourn Place on the Hillcrest Estate in the Oakland hills.

For its 1.5 acres do indeed include 250 Wente-Clone chardonnay vines, as well a concealed wine cellar, gardening beds, livestock pens, a chicken coop and fruit trees. This might not be the bucolic idyll, but it’s close: the nearest coffee shop is 2 miles away, there are stables down the road and the property is zoned for a horse.

The house itself won’t have you drooling — it’s a little bland and the living area is disproportionately small. But the master suite addition on an upper floor is a bonus, and given a mid-century makeover by someone with a sense of style, something could be done.

The setting’s the thing, though. Think glorious views, big skies and a sundowner cocktail on the deck before you wring one of your fowl’s necks and sling it on the BBQ.

Price: $1,398,000
Per sq ft: $519
Walk Score: 11/100
Related: House is on a cul-de-sac with neighbors; most Hillcrest Estate homes have a minimum 1-acre lot. Read this Times piece about “the pastoral beauty” of Oakland.
In brief: Is Oakland the new wine country?

Wild Idea: Signs that Say Something Useful

After an owner move-in eviction found my ass on the street a few years back, I resolved never to rent again. At the time things were slowing down, but they weren’t nearing full stop as they are now; so yes, interest only loans were still quite the popular option for teachers and similarly paid neophyte buyers with delusions of grander domiciles.
 
My agent, whose name I never speak unless I’m drunk, and even then, won’t say more than twice in row for fear that she, like Beetlejuice, will materialize on the third iteration, was evil. She would constantly take me to $650-$750K condos that I fell in love with, whispering in my ear sweet lies about how an ARM would make them more affordable than rent. When I later viewed properties in the $400K range, I hated them- yet they would have been perfectly acceptable if not viewed through the “but for just a few hundred more per month, you could have something so much nicer” lense. She was, for this and other reasons, the embodiment of why people ask “Why are Realtors such assholes.” (And they do ask that, and others answer: You can see for yourself on this Frontsteps blog post.)
 
But now I’m jaded. Still renting, but ever so much more informed, and well aware that I have no business in a $700K home. This is why I ask, nay beg, Realtors to be better at advertising on open house days. Say I’ve come to look at something in particular: Invariably, I will see 100 signs for other places also open that day, all in the same ‘hood, easily visited. In fact, so ubiquitous are these signs, we may soon see a law against them crowding the sidewalk, as reported on Schtuff. But though plentiful, these advertisements aren’t very useful.
 
First off, the entire sandwich board is generally taken up by the brokerage logo, and the address of the home for sale. Some also include the hours of the open house, and very occasionally, more info, like CONDO or SFH. See, now I know to try the former, but avoid the latter, since I recognize my income limitations. Helpful.
 
Better still though would be full disclosure: type of property, number of rooms, square footage, and yes: price. I’m not the only buyer to appreciate this idea either. I got the photo above from a blog by Tracey Taylor, on a similar theme. I realize, Realtor that I’m not, there is some reason for this evasion of detail. But buyer that I am, I tell you, I need it un-evaded. For properly informed, I would come to your open house if I knew I belonged there. I would not come if I did not.
 
…How much time could we all save? 

Ask Us: How To Clean Up A Meth Lab After A Sale

Where readers ask and we (the community) try to answer:

Truth be told, this email was sent within the confines of one particular local real estate brokerage. We’ve already seen the answers provided by colleagues in the biz, but damnit if we aren’t curious to see what kind of snarky remarks our readers can come up with.

My clients are interested in an REO where there was a ‘drug lab’. This property is very clean ‘looking’ and one would never know there was such an operation there. The buyer will be responsible for clean up within 90 days of the close since this is an REO, as-is sale. There are no clear signs of where the lab was, and so far, our inquiries with the police department have been poorly addressed. We plan on investigating the cost during our inspection period. Can any of you give me an idea of how best to pursue and who to use as an inspector for such an opportunity?

Funny that this email came literally the same day SF Gate reported “Feds join S.F. house blast probe; signs point toward accidental cause”. Is it an accident if you forget to mix the crystal with the meth? Just sayin’….

Symphony Towers Price Slashing Success

From the press release and maybe a little proof (if you want to call it that) of the “it’s a great time to buy” mantra:

For Symphony Towers, high-rise condos in the heart of San Francisco at 750 Van Ness Avenue, smashing prices equaled a smashing success as their Turk Tower closeout sale netted a whopping 18 contracts [out of 20 available. Nearly 1000 inquiries (Web site or at sales center) in the 3 weeks of the promotion.]

During the sales event the weekend of Nov.14-16 and Symphony Towers dropped prices more than $100,000 on studios and one-bedrooms — and the public responded. Hundreds of condo shoppers visited the sales center a few weeks prior to, and including, the closeout weekend, attracted in part by the “market correction” that potential buyers have been waiting patiently for, and perhaps, even expecting.

“The success of this promotion proves there are buyers out there; many just looking for an extra reason to jump off the fence and purchase a new home,” said Kim Cole, vice president of sales for Pacific Marketing Associates, the local firm in charge of sales and marketing for Symphony Towers. “This developer cut to the chase and offered firm reductions that simply couldn’t be ignored.

“Couple that with some post-election optimism and a great product in the heart of the City, it’s no wonder these homes were so quickly snapped up,” she added.

With the promotion, studio homes at Symphony Towers started at $295,000 — virtually unheard of for new construction in San Francisco, and likely the most significant price reduction yet by any development in the City. Comparable options that inexpensive were previously only found in the East Bay. Moreover, since Symphony Towers was already about 70 percent sold and occupied, buyers discovered that loans were easier to get.

Only two homes remain in the Symphony Towers’ nine-story Turk tower, with about 30 remaining in the taller Van Ness tower.

Don’t ask for details, because we don’t know them. Just getting info to you with GodSpeed (means don’t shoot the messenger). And no, so far nobody has come forward for their 50% rebate.

Pay Now, or Pay Less Later?

This is a question many across the nation will be pondering over the next several months and I’ve long believed that any bailout of homeowners would be ripe for abuse. The Chronicle had a great article this past weekend highlighting this “strategy” quite articulately and comprehensively. This should be really interesting to watch unfold as there will be certain individuals that will benefit from getting you into a loan modification program, and the differential savings from participating in the program may very well be significant. Reduced principle and interest rate, reduced taxes, and capped payments based on income! Isn’t there a downside here somewhere?

Here is the deal according to the article: Primary residence with loan greater than 90% of house “value” and backed by Fannie/Freddie or participating bank. The bank may reduce interest rates to 3% (or higher), extend loan  term to 40 years, and reduce principle in an effort to reduce your “payment” to 38% of your income.

The article talks about all of this in more detail and outlines some potentially controversial strategies to best take advantage of this program. I would bet that most in the bay area wouldn’t need to manipulate the system in order to qualify and benefit from this program.  Most people I know that purchased real estate in the past few years are closer to 60% of gross income funneled into housing and these are all folks right here in Prime San Francisco. And I’m talking about $1M+ homes / condos. I’m not sure how I feel about the program, but I know what I’d be doing if I were a home owner. What about you?

It’s A Great Time To Buy!

There, we said it, the words everyone expects us to say, because we’re Realtors, “It’s a great time to buy!” The truth is, it really is a great time to buy (provided you can get funding). There are properties that are getting into contract for ridiculously low prices compared to six months ago, and when they close escrow, some jaws will drop. Buyers are negotiating everything under the sun, and most sellers that are selling in this market do not have the luxury of waiting it out.

Sure, if you buy now, you’re going to look like an idiot to all of your friends because you bought in a spiraling market…but that will be short-lived. Have them over for a few cocktails, show them the nice CeasarStone counters, and wood floors you were able to put in with the money you saved on the purchase. In five years, you’ll look like a champ, in ten, the king of the world (your tiny little world that is, because you really are an insignificant speck of dust in the grand scheme of things, just like us).

If you plan on making San Francisco your home for the rest of your years (as many do), or at least the next 5-10, there are so many opportunities out there, we can’t even begin to point them all out.

There you have it. We said it. It’s a great time to buy (if you can).

Two “Bernal” properties, a block or two apart

55 Murrray street. Closed escrow Friday for 864K

127 Milton Street, bank owned and listed for $319.9K

I put “Bernal” in quotes even though I dislike the snarkiness with which that reads/looks on a web page. The thing is tho, these two houses aren’t really Bernal Heights if you ask me. They’re St. Mary’s Park and Outer Mission. Regardless, you can darn near throw a frisbee from one and hit the other (well maybe an Aerobie.)

Murray is in an area that is still seeing 2006 – 2007 type sales numbers, right now. For those who do not know, it’s waaaay down on the southern end of Bernal Heights. I like St. Mary’s park. The streets have a nice suburban feel to them, and the homes are attractive and well built. However its relative strength is a definite oddity at this juncture, as I’m sure even the most jaded bearish observor of SF r.e. would admit.

So compare with Milton. Heck, the similar facades invite comparison. Milton happens to be located in a neighborhood that’s sort of between neighborhoods, and cut up by a couple busy streets. It’s a fixer. It’s tenant occupied. It’s smaller (864 feet to 1325, are what the tax records indicate I believe). But still ….

If Cops Can’t Make You Safer, Maybe Pizza Can

Many of us have been strolling down a pleasant street, enjoying the twilight settling over Victorian facades in our charming city– only to turn a corner and suddenly feel in need of a Tazer. San Francisco is a changeling: Even in the same zip code, we can experience radically different neighborhoods, each with unique, and occasionally terrifying, personality.

Socio-economic stratification, drug use, sex trade: agreed, these are all unfortunate components of a modern metropolis. However, I’ve noticed it seems to be getting worse, rather than better, and I do not think this is something we should so willingly accept as “a sign of the times.” Riding my bike through Sharon Meadows on Sunday is like joining the cast of Night of the Living Dead. Things aren’t much better on Stanyan either; despite being an entrance to one of the city’s most revered attractions (for tourists and residents alike), this area of the Golden Gate Park is trashed: litter everywhere, dog crap, people lying around scaring the hell out of me…

It’s not just the park, not just the Haight. It’s also the Tenderloin, and slowly, steadily, more and more of the streets around it (an area San Francisco Citizen calls “The Flank”).  It’s lots of SOMA, even though we hoped the new construction projects would change that. It’s parts of Bernal, parts of the Mission, parts of Western Addition, Glen Park, Potrero. Union Square’s pretty disgusting too, since stepping over urine soaked homeless does not make me feel too great about shopping at Macy’s.

So well known are these areas that pizza delivery services won’t visit them. Witness SF Eater’s article on Amici’s delivery map:

 

 

“You’ll note, of course, the conspicuous no-fly zone assigned to the Western Addition, but also the after-dark ban around the Tenderloin and SoMa (sorry Mint Plaza, you’re SOL post-sunset). So many questions here: When delivering from the Lombard branch to the Lower Haight, do they take Fillmore down? Must one order a pizza to the corner of Divis and Geary? And what led to the all-hours embargo of just the Western Addition?”

Well, geez. I dunno. Homicides, maybe? I just wonder what kind of “sign of the times” it really is when a pizza restaurant has to make its own kind of safety, a protection the city seems unable to offer.

 

http://sfcitizen.com/blog/2008/11/08/san-franciscos-pizza-delivery-redlining-its-nice-and-legal/

Map: http://www.amicis.com/

Calling B.S. On The “Offer Coming”

Fellow Realtors and buyers, have you heard these words lately?

“We have an offer coming.”

You know? We’re going to go ahead and call b.s. on that claim. We’ve heard it five times in the last week on various properties we’re tracking, and guess what…they’re ALL still available, and the offers never came. Granted, some of the other properties we have our eye on have certainly received offers, but they’re pretty darn low and prices are being negotiated heavily.

There are also a few properties getting into contract in a price range we never thought imaginable, but we can’t share those details, as we’re still in the mix on a few.

Interesting market we’re in, and we’re learning more every day, and it pains us to not be able to spill the beans on all the good story being made, but we gotta do we we gotta do. Surely you understand.

Comment du Jour: “A Tide Going Back To The Ocean”

This from “asad” on “An Interesting Sale and Theory“. In that post, fluj essentially contributes strong home sales and prices in the southerly neighborhoods of San Francisco to their gentrification largely as a result of the jobs available even further south (think Silicon Valley and such). “asad” is not so convinced it will last:

Wait til Google [and] Cisco start to announce layoffs early next year. Sure some people still have money but it’s like a tide going back to the ocean. You still have tide pools here and there but if the tide doesn’t come back in soon, the tide pools are going to dry out, they just take longer.

Good analogy. Thanks for the comment. Google announcing layoffs would be a huge deal for the national economy, so we’re all ears if anybody else would like to share some knowledge in the comments below.

The State Of The Market

We take absolutely no credit for the below quotes whatsoever. They are pulled from a recent Domicile Properties newsletter that was sent our way. Enjoy:

The Good, the Bad, the Ugly and The State of the Market

Beautiful, stylish, architecturally compelling single-family homes in prime neighborhoods are still in great demand. They are selling quickly and sometimes with multiple offers. Those prices are holding steady. The same goes with elegant, spacious condos (and 2 unit TIC’s) in the same high demand neighborhoods.
In the past couple of months the usual way of doing real estate business in San Francisco has changed. Transactions move a lot more slowly. Buyers are more ponderous and deliberative. Lending requirements are more restrictive. Those with the wherewithal to obtain a loan, and the guts to escape the herd mentality of waiting on the sidelines until things get better, have a better environment in which to buy with a minimal amount of multiple offer activity.
TIC’s in 3-6 unit buildings have gone down in value. Financing can be even more difficult and expensive than with a single family or condo. Lenders require larger down payments. That said, TIC’s with good square footage, nice original detail and tasteful finishes in desirable locations are very good investments especially with the advent of better fractional financing. We’re hoping to see fractional financing in the near future with better rates and terms.
Lofts have also gone down in value. Consequently, very few lofts are on the market. The good news is that we think lofts will also make a big comeback. The city of San Francisco has a moratorium on new loft developments, so the supply will remain constant; and in comparison to the small square footage of new, high rise condo projects, lofts will emerge for many buyers as the better choice for home and investment.
If you are considering investment property, rent control and tenant’s rights can be daunting. But with knowledge, patience and a certain amount of flexibility the long-term potential payoff can be huge.

Some recommendations for an insecure market

To the best of your ability, try to be flexible with your initial plan for how long you will stay in your home. You may have to stay in your home just a little bit longer than you thought to realize the financial gain that you planned on.

If you have the money and time to remodel your place, do it. Properties that are remodeled, in good condition and show well sell for more money and will sell no matter what the market conditions are. These are the properties that are selling now.

When the market was red hot and highly competitive buyers overlooked many structural issues. In this market we are finding that buyers have greater parity and power, and are therefore less forgiving of items they see as problems. (i.e. big pest control reports, older roofs and heating systems, etc.) Consider investing in the structural work that’s needed. If you are planning or are in the middle of a cosmetic renovation push your contractor to give you a great price to also do some of the structural work that might be needed on your home. It is a good market for negotiating on services.

If you’re planning to repaint or do a big remodel, try getting a little help from a great designer. It will save money and aggravation.

We couldn’t have said it better ourselves and frankly are glad we didn’t have to.

-Domicile Properties.com

An interesting sale and a theory


This Precita street Bernal Beauty
was on and off the market in a flash. I’m not going to harp on over asking or anything. But I do want to point out that such a sale, no matter how lovely the home, would not have happened on Precita street three years ago, let alone four years ago, five years ago, etc.

I do know we’re in a downturn, even in SF. However my theory is that the runup that’s now over was not only aided by easy credit, and housing policies, but by the change in the workforce/economics around here. A consequence of the workforce’s change has been the gentrification of Bernal Heights, for one. The Pacific Heightsification of Noe Valley is another. The Noe Valleyfication of North Slope Potrero is a third. The Bernal Heightsification of the Mission is a fourth. We’ve seen high sale prices this fall for North Slope Glen Park; Sunnyside is now thought of as desirable because one can walk to BART; Miraloma Park sales continue to surprise (515 Foerster,with no garage, no views, maybe 1600-1700 sq feet or so, and a smallish backyard went for 830K yesterday) and on and on.

In a nutshell, the city gentrified south. It’s undeniable. And good — well at this point GREAT — properties are getting 2006-2007 prices still. The great properties make it all the more difficult for people selling OK or marginal properties to capitulate by lowering prices drastically. They look at their neighbors and think, “Hey. That house is a little better than mine but so what? I can get that sort of number too.” A stasis has in effect been reached.

Am I preaching to the choir here? Am I being pedantic because this is all fairly obvious to you guys? I’m interested to know what people think.

Rates Rising For TIC Loans

For those that aren’t quite aware, there is this great little invention called email that allows you to send questions, comments, topics directly to us. The email is thefrontsteps@gmail.com. Go ahead, give it a try. ;-)

From “Noe Guy“:

This is so way off topic, that I sincerely apologize in advance, but we had a thread last week regarding TICs and whether or not they were more risky. Fluj said that banks like Sterling were doing quite well with fractional loans, so I wanted to point out an article in [11/12/2008] WSJ:

Sterling Bank & Trust FSB recently raised its rate for TIC loans to 7.75% — a loan for a similarly priced condo would require only 6% to 6.25% interest — and now requires a down payment of at least 20% of the purchase price. Other banks are now requiring 30% down. In the past, lenders required buyers to put 10% down.

Residential TIC loans “are definitely more risky,” says Richard Yurich, a loan officer at Sterling Bank. “Once we make the loan it’s ours; nobody wants to buy them.” His bank raised rates and requires more money down to protect itself from a bad investment, he says.

There is another catch: There are no fixed-rate loans for TICs, meaning that buyers are forced to accept new terms after three to five years. This wasn’t a holdup when property values were increasing and mortgage rates were trending down, says Glenn Rodriguez, a mortgage broker. “That’s where we’ve lost a lot of the buyers over the last couple of months,” he says. “People are worried.

Just sayin’.

You are forgiven for “just sayin’”, because we can’t even find that thread you were talking about (truth be told, we didn’t look that hard), but thanks for sharing and thanks for reading!

If you care to send the link to the article, we’d be happy to pass it along.
[Update: Damn, that was fast...Residential-TIC Tack Hits Snags-WSJ.]

Vultures, Commence Your Circling

 

Well, all, few and far between are homes we can look at and positively say: That’d be a good investment. Yet here is one, that frankly, given the size and location, has to be just that. The downside– yes, sorry, these days there simply has to be one- is that this could be a lonnnnng term investment indeed. It could also bring out the evil in a person that he or she didn’t even know existed; but the latter, I suspect, is often the result of becoming a landlord in this city.

Welcome to 1847 Stockton, 2/1 TIC on Telegraph Hill, listed at just $250K. At issue is the tenant currently occupying the property. This tenant is “protected,” and “is not moving.” Now, if we know our tenant/landlord laws in SF as well as we should, we know protected tenants are either:

  • Ill, too ill to move, or that moving may make them worse
  • Disabled: Again, the burden and expense of moving has been deemed unacceptable to these persons
  • Elderly: Same logic as above, given the large number of very fixed incomes allotted to those no longer working
  • Long term resident: 10 years or more in the residency= you cannot get rid of this person legally.

Andy Sirkin, oft credited as the pre-eminent font of knowledge on all things eviction and TIC related (which incidentally, this property is both) puts it this way:

Protected Tenants: Certain tenants are “protected” and cannot be evicted for owner-occupancy except in very limited circumstances. Protected tenants are those 60 or over or disabled who have occupied for 10 years, and those catastrophically ill who have occupied for 5 years. Also remember that no tenant with an unexpired lease can be evicted, and that tenants who occupy a unit during conversion to a condominium are entitled to remain for one year after conversion, or for life if they are over 62 or disabled.

We have no way of telling from this listing alone what group this tenant belongs too, but it could easily be any of the above, including the long term residency, since the current rent being collected on a 2 unit in North Beach several years beyond what this tenant pays: $795 a month. (Um, no wonder the tenant is “not moving!”)

So how then is this a good investment? Well, I already said: It’s a 2 bedroom TIC in a highly desirable area, also in a building that looks well cared for. We don’t know how the unit itself looks (no pics: bad sign), but we can find out by attending the open house on 11/22 or 12/6 from 9am to 10am. In fact, if anyone goes, email some details to The Frontsteps as I’d love to do a follow-up. And hey: if we find the tenant to be ill or elderly, maybe we can project that lifespan he or she has left and plan our investment accordingly. Or, perhaps if you know a good hit man? Ha, ha. Calm down, people! Of course, I’m kidding; but you can see how the tenancy laws might bring out the worst in landlords, or landlords to be.

In any case, this property does offer some potential if you can wait it out. The rent collected now won’t cover the mortgage, so it’s a good bet for someone who can pay cash for the whole shebang. And, kismet: The listing says “all cash sale.” That means then in 333 months (27 years) or so, you’d have your principal investment back and could commence profiting. Or, you get lucky, and the tenant would …disappear first.

East Bay: Berkeley Named Top Spot For Selling Your Home

By Home Girl, aka real-estate blogger Tracey Taylor

If you are selling your home, Berkeley is the place to be doing it, according to a piece in Forbes which ranks the ten best suburbs to sell a home. (Suburb? Ouch that hurts.) This is how they put it:

Berkeley known sometimes as a hippie haven, is becoming a hotbed for home sales. Prices in the Bay Area suburb are up 9% this year, with homes selling for a median price of $790,986. Properties are sitting on the market for 73 days on average, the lowest of any area with positive price trends within the confines of the country’s 75 largest Census-defined metro areas. Only 37% of sellers have been forced to reduce their prices, one of the lowest rates in the country.

“Only 37%” of sellers reducing their prices? Shows just how bad it is. Other California spots to make it into the Top 10 include Encinitas and Venice.

The report draws on stats from Altos Research and the really interesting angle — and one Forbes fails to mention — is provided by Altos CEO Mike Simonsen on his blog. He says this was a difficult one to call:

Their editors called and asked, “Where are the best selling suburbs for sellers right now?” It’s a tough question because the answer, really, is nowhere… By our Market Action Index, there are essentially no markets with demand levels high enough to call them “Sellers’ Markets”. We settled on identifying ten suburbs whose demand trends … simply weren’t horrible.

Of course, a Forbes ranking of “10 suburbs to sell that simply aren’t horrible” doesn’t have quite the same ring to it.

[Photo credit: http://www.cityofberkeley.info

On Top Of The World At The St. Regis San Francisco

So this was all the remodeling noise we heard while selling the unit directly below this spectacular Penthouse at the St. Regis.


Hats off to Gregg Lynn and Louis Silcox for getting this $70,000,000

20,000+ square feet (including 2,900 of terraces); six bedrooms, seven full baths, four powder rooms; 2,500 square foot master suite (including the closet of dreams below); thirteen-seat home cinema designed by Keith Yates; 22 foot floor-to-ceiling glass walls in the living; and four terraces, four fireplaces and six car parking

home on the market. It is truly a remarkable piece of San Francisco luxury real estate, and we can’t wait to put you in this home.

We take it back, Kevin Rose, you should buy this pad instead.

-St. Regis Penthouse Details [Gregg Lynn]

[Admittedly, photo source and scoop via SocketSite (quoted above).]