Comments on: Ask Us: Why The Fuss About Noe Valley?

By: zanon

zanon — Wed, 03 Jun 2009 21:36:11 +0000

FLUJ: Cool.

ANON: Lots of variables there. They bought it for less in the past, so could be cash flow positive at a lower amount. I like looking at rent/buy breakevens, because when it’s about the same to rent as to buy, you *know* you’ve hit the bottom. This is actually the case in East Bay.

If you buy multi-family properties you can find stuff that’s cash flow positive, but nothing like that exists in my area (PA), and I don’t know if anything like that exists in the nice parts of SF.

SPARKY: All my estimates are on 20% down, current rates.

By: sparky

sparky — Wed, 03 Jun 2009 21:20:36 +0000

My full amortized is about $3200 on a house that cost $800K. It depends how much they put down on the place, what their rate is, and how long they have lived there.

By: anon

anon — Wed, 03 Jun 2009 19:45:50 +0000

Fluj, why can’t you advise them if they should should rent or sell? Say if a “family” member was the owner, what would you tell them?

Lets take a wild guess and assume the purchase price was north of $700k. $3,000 rent will not make it cash positive. Is this correct math?

[Editor's Note: Sorry, your comment was held in spam...no idea why.]

By: fluj

fluj — Wed, 03 Jun 2009 19:11:11 +0000

anon,

I’m talking about two different properties here.

zanon,

They’re angling for more than 3000, and it’s looking pretty good. I’ll let you know what happened once it’s a wrap.

By: anon

anon — Wed, 03 Jun 2009 18:54:25 +0000

I’m so confused – You went to see the property… then – oh wow! It turns out to be your listing? OK – weird. Why didn’t you jsut say it was your listing in the first comment?

By: zanon

zanon — Wed, 03 Jun 2009 18:47:26 +0000

FLUJ: Cash flow positive at $3K/mo would have the property valued at about $500K. Is that right?

By: lily

lily — Wed, 03 Jun 2009 18:23:47 +0000

I can’t speak to whether the pricepoint is real or not, not knowing anything about the property or price, but it sounds like you are a good agent in that you are looking out for your clients’ best interest instead of yours.

By: fluj

fluj — Wed, 03 Jun 2009 17:10:07 +0000

The reason the property is still listed is because the pricepoint is real. There’s no smoke and mirrors. All of the offers have been 6 or 7 % under asking. The sellers have moved away for two years, for school. But they are getting all sorts of rental interest for $3000+/month. And that would be cash flow positive in the sellers’ absence. Why should the sellers take a hit on their downpayment when they can rent for cash flow positive in their absence? I can’t advise them to do that. Despite the fact that they don’t wish to be absentee landlords.

By: lily

lily — Wed, 03 Jun 2009 04:20:59 +0000

Fluj,
if you have listing that is getting offers then why is it still listed? I’m confused if things are only down a few percent then the offers should be reflecting that.

By: fluj

fluj — Tue, 02 Jun 2009 21:02:58 +0000

I went to see the 30th street property today, and …. I misspoke. It’s not underpriced. It’s a cool property but not for everyone. The bedrooms are on three different floors, the kids’ room has the big view, the lower floor is more like an enormous office than a bedroom, the lower master has has wide open windows facing the backyard. All in all I liked it. But the photos do it a world of good.

By: 33 y/o yurt dweller

33 y/o yurt dweller — Tue, 02 Jun 2009 20:40:29 +0000

Forecast for Bernal is sunny! Oh, you mean the real estate market?? Not so much.

By: fluj

fluj — Tue, 02 Jun 2009 17:13:13 +0000

You do? Where? I can think of a couple, one on Gates and one on Fair. Other than that I feel as if things are down a little bit (5 or 10 percent down), but not nearly that much. And I have a listing of my own that’s been getting offers, so I feel like my gauge is pretty spot on.

By: lily

lily — Tue, 02 Jun 2009 04:20:42 +0000

thanks fluj. it seems that bernal has had a steady decline as i’m seeing homes bought in 2006/07 now listed at 50-100K less and still sitting! I knew things would level out but I never imagined this in my wildest dreams!!

By: fluj

fluj — Tue, 02 Jun 2009 03:43:06 +0000

Lily,

I feel as if the superconforming 729K loans, plus the surprising amount of capital would be Bernal buyers seem to have, plus the typical sub ~1M cost for an average Bernal SFR, all fit together pretty nicely. As long as those loans are available, IMO, Bernal will keep sailing along at about the same clip it’s now at.

By: lily

lily — Tue, 02 Jun 2009 00:28:44 +0000

what’s the real estate forecast for bernal?