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CALIFORNIA HOUSING MARKET LOSES MOMENTUM

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CALIFORNIA HOUSING MARKET LOSES MOMENTUM AS AFFORDABILITY CRUNCH STIFLES HOME SALES
Source: C.A.R.

California home sales downshifted in August as low housing affordability and a tight supply of homes for sale cut into demand, especially in high cost areas of the San Francisco Bay region, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said.
Making sense of the story

  • Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 420,360 units in August, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide sales figure represents what would be the total number of homes sold during 2016 if sales maintained the August pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
  • The August figure was up 1.1 percent from the revised 415,840 level in July and down 2.2 percent compared with home sales in August 2015 of a revised 429,900. Home sales remained above the 400,000 pace for the fifth straight month, but sales have declined year over year for the sixth consecutive month.
  • “We are seeing the market tempering, which is being driven by reduced affordability and not enough homes for sale on the market, particularly in the San Francisco Bay regions, where runaway home prices have constrained home sales,” said C.A.R. President Pat “Ziggy” Zicarelli. “Two of the region’s least affordable counties – Marin and Santa Clara – saw sales fall from a year ago, while Contra Costa and Sonoma counties experienced more modest slowdowns. Conversely, in many parts of the Central Valley, where homes are more affordable and demand has been relatively strong, home sales posted healthy increases. Likewise, sales of condominiums statewide were strong, thanks to their relative affordability.”
  • The statewide median price remained above the $500,000 mark for the fifth straight month and is at its highest level in nearly seven years. There are, however, signs of an expected slowing in price growth. The median price of an existing, single-family detached California home was up 1.7 percent in August to $526,580 from $517,650 in July. August’s median price increased 5.8 percent from the revised $497,520 recorded in August 2015. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling as well as a general change in values. The continuing rising home prices despite falling sales suggests that demand continues to outstrip new supply coming online, which is pushing prices higher.

Category : Blog

20 Hottest Housing Markets

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IMG_0208Housing is sizzling in the last few weeks before the end of summer. According to Realtor.com®, it’s the “hottest August in a decade” for real estate.

Homes are selling 2 percent more quickly than a year ago and prices are reaching new highs. The median home was listed for $250,000 on realtor.com®, which is 8 percent higher than a year ago.

Read more: The 20 Hottest Housing Markets for July 2016
Realtor.com®’s research team did its annual check up on housing markets across the country to identify which metros are seeing homes sell the fastest and garnering the most listing views (based on realtor.com® traffic). New cities added to its list this month included Kennewick, Wash., and Waco, Texas. Detroit also notably moved up in the rankings this month, up four spots to land in the top 10.

Here are the 20 real estate markets that topped realtor.com®’s list in August:

  • Vallejo, Calif.
  • Dallas
  • Denver
  • San Francisco
  • Stockton, Calif.
  • San Diego
  • Columbus, Ohio
  • Waco, Texas
  • Detroit
  • Sacramento, Calif.
  • Fort Wayne, Ind.
  • Yuba City, Calif.
  • Modesto, Calif.
  • San Jose, Calif.
  • Fresno, Calif.
  • Colorado Springs, Colo.
  • Santa Cruz, Calif.
  • Kennewick, Wash.
  • Santa Rosa, Calif.
  • Nashville, Tenn.

Category : Blog

5 Things Renters Should Know About Owning

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For renters who aspire to be home owners, transitioning from an apartment to a house requires a shift in their thinking that they may not be prepared to make. The financial changes that come with owning, the need to consider planting longer-term roots in a neighborhood, and new neighborhood rules are things renters may not be thinking about enough.IMG_0431

Read more: Where Buying Beats Out Renting the Most
As their real estate agent, it’s important for you to be there for your clients when they’re embarking on a life-changing event such as buying a home.

Moving can already be one of the most stressful times in a person’s life, but it may be doubly so for a new home owner. In order to be their most reliable resource, using your knowledge and experience to provide them with guidance, share these helpful nuggets of information with your clients so their transition from renter to owner can be as smooth as possible.

They need to understand how their financial investment is changing. Renters may see an increase in their monthly rent every lease term, but they don’t see exactly where it goes — toward property taxes and insurance, even “luxuries” such as trash pickup. As home owners, they don’t have a landlord who handles all those details, so they need to be ready to juggle the financial responsibilities of home ownership. Have an open conversation with your clients about these changes and the importance of budgeting to make sure they make smart financial decisions during this process.

They need to be happy with their location for the long-term. As a renter, you can bounce around from home to home every year if you want. But when you own a home, you have to stay put — unless you plan on renting it out, which most home owners don’t. Impress upon your client that location is going to play a much more significant role in their future, so they should think about evaluating school districts, access to amenities, and commute time now as they search for their next home.

They may need to abide by new rules. Renters don’t think about possible homeowner association rules they may be governed by, such as trash pickup rules or any curfews or rules pertaining to animals. Make sure to get all the information on neighborhood rules and associations to help your client understand what their new obligations will be.

They’ll need to get into the mindset of an owner. Life as your client knows it is about to change. Once your client purchases a new home, they will no longer have a landlord to tend to their many needs, including lawn care and plumbing. The best way you can help them as their real estate agent is to provide them with contact information for local industry experts. They will eventually need certified specialists ranging from HVAC companies to carpenters to electricians. Let them know they don’t have to do everything themselves.

They should know their neighbors can affect their value. Renters don’t care who their neighbors are as long as they’re quiet (enough). But your client is now going to want to know whether their new neighbors are renters or home owners. This knowledge can help your clients gauge current and future home value in the neighborhood. If the neighborhood consists mostly of rental properties, it is likely a home owner will lose money on their house in the future. Renters do not always feel responsible for maintaining their properties the way home owners do. Property value comes down to curb appeal. Less-appealing neighborhoods often have more-appealing prices, which is not always good for buyers and home owners.

Category : Blog

Housing Affordability

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MANY FULL-TIME WORKERS FACE HOUSING AFFORDABILITY PROBLEMS
Source: Harvard

While statistics on the gap in affordable housing clearly indicate the magnitude of the problem, they mask the extent of the difficulties that certain low-wage workers often face in obtaining a unit they can afford, particularly in major metro areas.

Making sense of the story:

  • Data from the Bureau of Labor Statistics indicate that in many markets, most full-time cashiers, retail and sales persons, and food preparation workers would have been unable to afford even a modest one-bedroom apartment.
  • The fair market rent of a two-bedroom apartment was even further out of reach for these workers: as high as $2,062 in San Francisco and over $1,400 Washington, DC, Boston, New York, and Los Angeles.
  • Other occupations where median annual wages were inadequate for households to afford a modest one-bedroom apartment include—but are not limited to—EMTs and paramedics, childcare workers, security guards, and several types of healthcare support occupations.
  • All of these jobs are vital to local economies, and support a variety of businesses and services required for healthy, growing communities.
  • Wage stagnation among low-income households is certainly part of the problem. Between 2001 and 2014, the median real household income for renters in the bottom quintile fell 9.9 percent, while income for households in the top quintile was up 3.1 percent.
  • To make ends meet, many low-wage households must reduce expenditures on food and healthcare, move to areas which are less accessible and require longer commute times, or double up with family or roommates.
  • Nearly a third of the nation’s 7 million renters earning less than $35,000 in 2014 had minors living at home, and fully half of these families reported being severely cost-burdened in the same year—paying more than half of their incomes for housing.

Category : Blog

California Affordability

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STRONG WAGE GROWTH AND LEVEL HOME PRICES BUOY CALIFORNIA HOUSING AFFORDABILITY
Source: C.A.R.

Higher wages and lower seasonal home prices combined to push California housing affordability higher in the first quarter of 2016, compared to the previous quarter, according to the CALIFORNIA ASSOCIATION OF REALTORS®. Affordability was flat when compared to the previous year as rising home price offset income gains.

 

Making sense of the story:

  • Thirty-four percent of California households could afford to purchase the $465,280 median-priced home in the first quarter, up from 30 percent in fourth-quarter 2015 and unchanged from 34 percent in first-quarter 2015.
  • A minimum annual income of $92,571 was needed to make monthly payments of $2,314, including principal, interest, and taxes on a 30-year fixed-rate mortgage at 4.01 percent interest rate.
  • Forty-one percent of home buyers were able to purchase the $389,910 median-priced condo or townhome. An annual income of $77,575 was required to make a monthly payment of $1,939.
  • Home buyers needed to earn a minimum annual income of $92,571 to qualify for the purchase of a $465,280 statewide median-priced, existing single-family home in the first quarter of 2016.
  • Condominiums and townhomes were also more affordable compared to the previous quarter. Forty-one percent of California households earned the minimum income to qualify for the purchase of a condominium or townhome in the first quarter of 2016, up from 39 percent from the last quarter of 2015.
  • Compared to affordability in fourth-quarter 2015, 22 of 29 counties tracked saw an improvement in housing affordability, three experienced declines, and four were unchanged.
  • Affordability improved greatly in the Bay Area, with eight of nine counties seeing an improvement. Southern California, Central Coast, and the Central Valley also saw higher affordability, compared to the previous quarter.

Category : Blog

Wells Fargo Agrees to Pay $1.2 Billion for Improper Mortgage Lending Practices

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The Department of Justice recently announced that the United States has settled civil mortgage fraud claims against Wells Fargo Bank, N.A. (Wells Fargo) and Wells Fargo executive Kurt Lofrano, stemming from Wells Fargo’s participation in the Federal Housing Administration (FHA) Direct Endorsement Lender Program. In the settlement, Wells Fargo agreed to pay $1.2 billion and admitted, acknowledged and accepted responsibility for, among other things, certifying to HUD, during the period from May 2001 through December 2008, that certain residential home mortgage loans were eligible for FHA insurance when in fact they were not, resulting in the government having to pay FHA insurance claims when some of those loans defaulted. The agreement resolves the United States’ civil claims in its lawsuit in the Southern District of New York, as well as an investigation conducted by the U.S. Attorney’s Office for the Southern District of New York regarding Wells Fargo’s FHA origination and underwriting practices subsequent to the claims in its lawsuit and an investigation conducted by the U.S. Attorney’s Office for the Northern District of California into whether American Mortgage Network, LLC (AMNET), a mortgage lender acquired by Wells Fargo in 2009, falsely certified and submitted ineligible residential mortgage loans for FHA insurance.

Source: California Association of Realtors

Category : Blog

8 Bad “Home Improvement” Habits

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8 Bad ‘Home Improvement’ Habits

 

DAILY REAL ESTATE NEWS | FRIDAY, FEBRUARY 26, 2016

 

Home owners can overdo it when it comes to the upkeep of their home. This Old House recently spotlighted several ways that home owners’ enthusiasm for home ownership may actually harm the house.

 

1. Having light bulbs that are too bright. You want a well-lit home, but exceeding a lamp or light fixture’s recommended wattage can be dangerous, particularly with incandescents or halogen lights, says John Drengenberg, consumer safety director for Underwriters Laboratories. “Using a bulb with too-high wattage will cause the fixture and its wiring to overheat,” he notes, which could then allow the heat to travel to the wall or erode the insulation on the wires and lead to a house fire. Check the fixtures label to make sure you use the correct wattage.

 
2. Planting trees near driveways or walkways. A line of trees to the house may up its curb appeal but adding young trees near driveways or walkways could be putting your slab at risk. As these trees grow taller, their roots will go outward, potentially pushing up the paving and causing it to buckle or crack. This Old House recommends planting small trees that will remain under 20 feet at maturity and that are at least 10 feet from paved areas. For larger trees, leave at least a 20-foot radius.

 

3. Overscrubbing a sink. Don’t overdo it with abrasive cleaners; they can scratch the sink. “Cleaners with a grit or grain to them will wear away at the finish and dull it,” Kohler’s Mike Marbuch told This Old House. “That will make the sink more prone to gunk sticking to it—actually making it look dirtier.” Try a liquid cleanser like vinegar or lemon juice on the sink and avoid scrubbing it every day.

 

4. Overdoing it with can lights. Excessive recessed lighting in a home can cause a lot of air leaks. Recessed lighting is known as causing heat-sucking air leaks, especially when the fixtures are unsealed in vaulted ceilings. Airtight recessed lighting fixtures are available that are rated for insulation contact (IC). Also, use as few recessed lights as you can, especially when it comes to adding them to cathedral ceilings or in rooms directly below unconditioned attics.

 

5. Spreading too much mulch outside. “Over-mulching will suffocate plants, confuse their root systems, and prevent water from percolating into the soil,” notes the article at This Old House. “If you’ve mulched so much that tree trunks and flowers’ and shrubs’ lower branches are covered by or dragging in it, you’ve gone overboard.” Have mulch no thicker than 3 inches.

 

6. Using glass cleaner on mirrors. Watch out for store-bought sprays that promise to make your glass sparkle. “A drop of liquid running around the mirror’s edge can cause the reflective backing to lift or craze,” This Old House notes. The black edge can occur from using ammonia- or vinegar-based cleaners. This Old House recommends using warm water and a soft, lint-free cloth to clean mirrors. Or if you do use the sprays, spray it onto a dry cloth first and not directly onto the glass.

 

7. Repainting too much. “Excessive paint is detrimental – especially on an older house, which may have layers of thicker oil-based paint, which becomes brittle with age,” notes This Old House. To avoid thick, cracked, or peeling paint, be sure to carefully power-wash prior to painting, sand areas that need it, and then use 100 percent acrylic-resin exterior paint.

 

8. Fertilizing too much. Fertilizing too often can spur more weeds to grow. Also, the Environmental Protection Agency warns over-fertilizing can cause “nutrient pollution,” which is when nitrogen and phosphorus runoff from lawn fertilizers and then leads to an overgrowth of algae that can even pollute local waterways. Some lawn experts recommend only fertilizing twice a year, late summer and fall only.

 

Source: “19 Ways You’re Killing Your Home With Kindness,” This Old House (February 2016)

Category : Blog

California Homes Sales Kick Off Year Higher in January

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CALIFORNIA HOME SALES KICK OFF YEAR HIGHER IN JANUARY
California existing home sales posted their best January performance in three years as year-over-year sales recovered from delayed escrow closings late last year caused by new loan disclosure rules, C.A.R. reported Wednesday.

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 383,670 units in January, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide

The January figure was down 5.4 percent from the revised 405,760 level in December and up 8.8 percent compared with home sales in January 2015 of a revised 352,640. The January 2016 sales level was the highest since January 2013, when an annualized 421,780 homes were sold.

The median price of an existing, single-family detached California home fell 4.3 percent in January to $468,330 from $489,310 in December. January’s median price was 9.2 percent higher than the revised $428,980 recorded in January 2015.

Category : Blog

Home Prices Increase

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HOME PRICES CONTINUE TO INCREASE

Source: California Assocation of Realtors
S&P Dow Jones Indices released the latest results for the S&P/Case-Shiller Home Price Indices, which shows that home prices continued to rise nationwide over the last 12 months.

The S&P/Case-Shiller U.S. National Home Price Index, covering all nine U.S. census divisions, recorded a slightly higher year-over-year gain with a 5.3% annual increase in November 2015 versus a 5.1% increase in October 2015. The 10-City Composite increased 5.3% in the year to November compared to 5% previously. The 20-City Composite’s year-over-year gain was 5.8% versus 5.5% reported in October.

Before seasonal adjustment, the National Index posted a gain of 0.1% month-over-month in November. The 10-City Composite was unchanged and the 20-City Composite reported gains of 0.1% month-over-month in November. After seasonal adjustment, the National Index, along with the 10-City and 20-City Composites, all increased 0.9% month-over-month in November. Fourteen of the 20 cities reported increases in November before seasonal adjustment; after seasonal adjustment, all 20 cities increased for the month.

Category : Blog

Millennials Not Saving

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STUDY FINDS MAJORITY OF MILLENNIALS HAVE $1,000 OR LESS IN SAVINGS
Source: Bustle

Millennials are projected to number 75.3 million for 2015, surpassing a projected 74.9 million for Baby Boomers. Millennials will therefore comprise a greater percentage of the population than Baby Boomers for the first time. Howmuch.net conducted a survey to gain insight into the saving habits of this age group. Since millennials are growing as a percentage of the population, their savings and spending habits will increasingly have a major impact on the overall economy.

Making sense of the story

More than 50 percent of millennials have less than $1,000 in savings. This would indicate that most millennials do not have a cushion to fall back on in case of an emergency, not to mention the funds for a down payment on a home.
The survey found 56.3 percent of millennials earning $25,000 to $49,000 had less than $1,000 in savings. This compared with 31.2 percent of those earning $75,000 to $99,999.
Among those earning $100,000 to $149,000, 14.8 percent had savings of $5,000 to $10,000.
Also, 14.3 percent of those with savings of $10,000 to $20,000 were those millennials with incomes in excess of $150,000, the highest percentage in that range of savings.
For a gender comparison, 56.7 percent of females have less than $1,000 in savings as compared to 46.5 percent for males.
Notably, 57.6 percent of respondents from the ages of 18 to 24 have less than $1,000 in savings. This compared to 47.1 percent of those from the ages of 25 to 34.
For savings of $1,000 to $5,000, 19.6 percent of respondents from 18 to 24 had savings in this range, compared to 16.6 percent of those from 25 to 34.

Category : Blog

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Since 1970 Rinetti & Co. Realtors has been selling residential and commercial real estate throughout the greater East Bay. We are boutique real estate company with a single focus, exceptional customer service from start to finish. Rinetti & Co. Realtors has the experience and practical knowledge to adapt to changing market conditions while providing our clients expert advise when buying or selling a home. If you’re considering making a move please contact us and see the difference Rinetti & Co. Realtors can make for you.

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