Rates head up

With talk of inflation in the air thoughts are turning to the Fed raising rates in the near future.  This certainly affects the monthly payments for current buyers who have not locked in their rate.  But Brian Brady doesn’t see the Fed raising rates until 2009.

BankRate® 30 Year Fixed Mortgage Rate Trend

Supes talk upping transfer tax

Increases in Rate of Real Property Transfer Tax Rate Proposed

Two supervisors, Aaron Peskin and Jake McGoldrick, have proposed increases in the rate of the city’s real property transfer tax. Both proposals are intended to leave the rate for less expensive properties unchanged while focusing on properties in the mid- to high- price range.

State law requires tax increases affecting real property to appear on the ballot and to be approved by a two-thirds vote of the electorate for passage. It is not known at this time whether either or both of the proposals will appear on the municipal ballot in November.

To provide a basis for comparison, set forth below are the current transfer tax rates, as well as those proposed by Supervisors Peskin and McGoldrick. Changes to the transfer tax ordinance currently in effect are underlined.

Current Rate Structure:

• Over $100 and less than or equal to $250,000 = .50%
• More than $250,000 and less than $1 million = .68%
• Equal to or more than $1 million = .75%

Proposed Rate Structure (McGoldrick):

• Over $100 and less than or equal to $250,000 = .50%
• More than $250,000 and less than $1 million = .68%
• Equal to or more than $1 million but less than $1.25 million = 1%
• Equal to or more than $1.25 million but less than $1.75 million = 1.25%
• Equal to or more than $1.75 million but less than $2 million = 1.5%
• Equal to or more than $2 million = 1.75%

Proposed Rate Structure (Peskin):

• Over $100 and less than or equal to $250,000 = .50%
• More than $250,000 and less than $1 million = .68%
• Equal to or more than $1 million and less than $2 million = .75%
• Equal to or more than $2 million = 1.5%
• (Tax Reduced on Transfers of Residential Property by Up to One Third If, After January 1, 2009, Transferor Has Installed Active Solar System or Made Seismic Retrofitting Improvements or Improvements Utilizing Earthquake Hazard Mitigation Technologies)
• (Clarifies Application of Tax to Transfers of Ownership Interests in Legal Entities that Own Real Estate)

The Association’s board of directors has voted to vigorously oppose all proposed increases in the city’s real property transfer tax as an unwarranted financial burden on buyers and sellers of real property in the city.

A unique perspective on new condo online marketing

You have to check out www.therobclark.com a web site that cleverly focuses on the experience of a new condo, rather than the amenities or finishes.  I’ve been critical of the blandness of the majority of our new construction web sites, although this one is in LA, Beverly Hills to be exact, I definitely have to give it my top tiara rating!  Thanks, Rob!

Map our San Francisco Micro Climates

I love Weather Bonk, a site where you can map weather, and check out web cams all over the City.  With our diverse micro climates here in the Bay Area it’s difficult to explain to newcomers why they might want to take a jacket if they are headed to the Zoo.  For us old-timers we have an extra sweat shirt in the trunk in case we find ourselves across town.  Weather also plays a part in real estate prices, becoming a part of the location-location-location equation.

Of course you can also check out the weather anywhere in the world by typing in the city, country, or simply world to see how San Francisco compares.  I hope this doesn’t mean that we won’t be able to identify the tourists with their $12 SF fleeces and shorts in the summer!

#1 Selling Tip

Thinking of selling and wondering what you should do to prepare your home? Eliminating and editing all your collectibles is the best first step. This video provides a good demonstration.

from www.expertrealestate posted with vodpod

Beware of Buyers

The boys at The Front Steps have run into a couple of buyers out there who are not who they represent themselves to be apparently. Thanks, guys, this really is a service to our profession. They encourage everyone to send this link out to the agents in their office.

San Francisco Rents up over 14%

San Francisco tops the list of Bay Area cities says RealFacts recent study according to this article from the Chron (scroll down to see the chart).

And sfcurbed found some Inifinty condos that will be available to rent in May.

I’m putting together a list of South Beach condos that will actually cash flow!

Inside a Mortgage Guy’s Head

Since interest rates have been on everyone’s mind of late, I thought I’d share my daily missive I receive from Anthony Samadani of MetroCities Mortgages so you can see what kinds of sugar plumbs he has dancing in his head:

“Massive volatility remains the name of the game – and will likely continue.

After Bonds fell sharply lower yesterday and opened lower today, prices have now rebounded higher off Fed Chairman Ben Bernanke’s testimony before the House Budget Committee, combined with an ugly Philadelphia Fed Manufacturing Index.

A few highlights from Bernanke’s testimony – the December Jobs Report was disappointing to the Fed, and the outlook for the economy in 2008 has worsened. He indicated no recession but slow growth, as he feels that overall, the US economy remains resilient and has inherent strengths. He confirmed that additional rate cuts may be necessary while knowing that inflation is still a risk, but feels that overall headline and core inflation should moderate.

Bernanke’s “no recession” comment is very interesting, but he has been optimistic all along…perhaps a little too optimistic, as he has now been proven wrong on his thoughts about the credit markets. Additionally, Bernanke’s comments underscore the conundrum we have often framed here, in that the fight against recession is being done with a hand tied behind the Fed’s back, due to pesky inflation.

So – if you read between the lines – Bernanke’s comment of “no recession” means that upcoming Fed cuts may not be as deep as the market would like to see. Therefore some anxiety selling was created in the Stock market, which is transferring into the purchase of Bonds, helping prices improve this morning.

Also helping Bonds this morning was a downright terrible Philadelphia Fed Manufacturing Index, which was reported at -20.9 and far below expectations of -1.5. And as if that weren’t enough already, Housing Starts were reported at 1,006,000, which was lower than expectations of 1,150,000. This was the lowest number of Starts in about 16 years. Building Permits were not much better, as they fell by 8% to an annual rate of 1,070,000, their lowest number in 12 years.

While many pundits and media moguls will be quick to point to this number as evidence of further demise within the housing market – we think it is actually a very good sign. High inventory is a problem for the real estate market – so less new inventory coming on the market will be a positive for those who see the opportunity in the future.

Initial Jobless Claims, a volatile number, surprised with a better than expected report of just 301,000 filings for new unemployment benefits. This number is a bit of an enigma, after watching job growth weaken and the unemployment rate spike. Let’s keep an eye on this trend.

Amidst all the economic noise, the markets are figuring a 50bp rate cut on January 30th is in the bank. We agree. Technical signs clearly indicate that the Bond is being stretched and priced for perfection. The “leash effect” has been a very accurate indicator that prices will soon pull back towards the 25-day Moving Average, and we are close to seeing that happen. The top of the channel shown on the Bond Page has been a strong, almost impenetrable ceiling, and the Bond is clearly in an overbought state.

Because of the current price appreciation, we are floating, but with a finger on the lock trigger, as it would not surprise us to see more volatility and perhaps an afternoon reversal.”

Thanks for sharing, AJ!  asamadani@metrocitiesmtg.com

Condocontessa does not endorse guest opinions.

San Francisco rents rise

I just heard this morning, on kqed radio, that Realfacts is reporting a nearly 9% increase in bay area rents.  Unfortunately, I haven’t been able to find this information on Realfacts website.  Yesterday I stopped by the Palms to see what they have left and saw a corner 1 bedroom with Twin Peaks views — when I ran the numbers the payment surprisingly came out to comparable rents in the building!  Once I find the source for this stat I’ll post it in the comments section of this post.  If one of you finds it before I do, please add it to the comments section!

5 Reasons to Buy Now in San Francisco

With all the doom and gloom headlines selling newspapers, there are some often overlooked facts that make this a good time to buy.

1.  Low interest rates; the rates dropped overnight to 5.5% for a 30 year fixed.

2.  There are more properties on the market than there have been in the last few years for buyers to choose from; it’s a buyers market, which is perfect for being a buyer.

3.   Sellers and developers have adjusted to the new market climate and are willing to make concessions.

4.   San Francisco rents are still rising.

5.  San Francisco still has a housing shortage; and we have a good jobs economy — you will be poised to cash in on the next market cycle.