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East Bay Real Estate: Jobs Update – Underwater = Not Moving!

Jobs, Jobs, Jobs continue to replace Location, Location, Location in the world of East Bay real estate.  However, with the job market finally improving in the Bay Area and looking very good for 2012 the challenge is for people whose home is underwater and are unable to move to where the jobs are booming.   We are fortunate in the Bay Area that our unemployment is almost 3% lower than our State – 9.6%.  And, our percentage of homes underwater in the Bay Area is only 12%, compared to San Diego that has 28% of their homes underwater.  Still this issue is making it harder for Bay Area homeowners to relocate for work.  The Wharton School study has determined that about 30% of homeowners who are underwater as less likely to move compared to those who are renting or have equity in their home.  FEAR is still a big factor today.

In a typical economy that is improving, people relocate from regions where unemployment is high to where jobs are booming.  For example, in today’s job market people would be moving to Silicon Valley, North Dakota, Nebraska and Texas. Because of the lack of mobility of so many home owners,  companies who want to expand are having challenges with hiring enough of the needed employees.  Filling jobs locally has not been an issue the past four years because of having so many people unemployed.  However, with the uptick in the economy and unemployment rates lowering, this will become a bigger issue than you may think.

This topic is also an issue for people who have jobs who want to relocate for a better position, or have been given a promotion that requires a move.  They are not going to move if their home is underwater.  Because of this, companies who are expanding are increasing relocation benefits to top candidates. One of the benefits being provided is the cost of selling a candidate’s home that is underwater.  We just represented a Seller who was promoted to a position in Los Angeles and her company paid the difference between the selling price and the amount that was owed to the mortgage because there was a deficit.  This is causing companies to be even more selective with which candidates are selected for promotion.  We believe this topic will become even more evident in the Bay Area as 2012 unfolds.  This may be the ‘wild card’ in our expanding job markets.

If you would like to learn what your Bay Area home is worth, CONTACT US for a FREE valuation report.  It would be our pleasure to assist with any of your real estate needs.  Until next time…Jim Walberg.

The Tobin Clark Estate: A Once In A Lifetime Opportunity For $29 Million

The Tobin Clark Estate: Maybe once in a lifetime one is able to acquire a true architectural masterpiece.  That opportunity has just arrived in Hillsborough, California. For more than sixty years, the Hillsborough Mansion with the unassuming name “House-on-Hill” has been cited as one of the most spectacular private residences ever created in its fine antique English style.  In the 1920s, Celia Tobin Clark, an heiress to the Hibernia Bank fortune, commissioned architect David Adler to create a Cotswold Tudor Mansion on a secluded hilltop of some 400 acres just south of San Francisco.  Full-grown trees were transplanted from as far away as the Monterey Peninsula, rose terraces and formal courtyards were laid out amid the oak groves and lawns, and multiple-trunk olive trees were pruned to dip low over matching reflecting pools set in a stone terrace. Completely by hand, an architectural treasure was built.

This magnificent 35,000 square foot estate, now on six acres,  evokes all the ambience and grandeur of another era.  Featured as a Decorator Showcase in the early 1990’s, this circa 1930 Cotswold Tutor mansion has been meticulously renovated with a superb level of fine craftsmanship, architectural design and interior finishes. Secluded from view behind classic wrought-iron gates, one enters the grounds of this estate through a dramatic lighted cobblestone drive into a large motor court with a spectacular stone fountain – a truly grand entrance for the most elegant of galas.

An elegant black and white marble reception foyer greets guests, with a carved balustrade staircase leading to opulent public rooms;  a banquet-sized formal dining room with carved marble fireplace and oversized French Doors leading to the Loggia and Grand Terrace; a cozy Library with 17th Century English paneling;  and the crowning glory, The Music Room.  This spectacular chamber, which is 55 feet long and is crowned by 15 foot ceilings with exquisite three dimensional decorations, features antique parquet-de-Versailles floorings, triple gold-gilt moldings, matching fireplaces, Bay Windows and French doors leading to the Grand Terrace.  The Music Room of Tobin Clark Estate is featured in Helen Comstock’s as one of the 100 Most Beautiful Rooms In America.

Other features of the Tobin Clark mansion include 9+ bedrooms, 11 baths, 11 fireplaces, main kitchen, service pantry and kitchen, super-luxurious master quarters, a VIP suite (host to Heads of State), a handsome Bar Room, separate Guest Apartment, Wine Vault, Exercise Room and a huge Recreation/Media Room. The property also enjoys a six car garage and state-of-the-art systems, including sound, lighting, security and intercom throughout.

Upon completion in 1931, the home was filled with interior decor by Syrie Maugham (wife of Somerset), paintings by Van Dyke and Sir Joshua Reynolds, Queen Anne paneling, eighteenth century Chinese wall coverings, a rare Dubois writing table and over two hundred other items sent from England and the Continent.  With a prized view overlooking San Francisco’s Lower Bay and the rolling landscape far to the west, ‘House-on-Hill’ now rests on a more manageable six acres, without the original Adler-designed sixteen-stall stables, ten-car garage and “laundry group”.  Little else, though, has been sacrificed, and the house remains quietly tucked away behind the espaliered magnolias and majestic pines of a cherished Hillsborough setting.

Now viewing the lights surrounding San Francisco Bay, the 6-acre grounds offer an oasis featuring a Grand Terrace, rolling lawns, pool with guest house, a balustrade Rose Garden and manicured formal gardens with statuary. The exquisitely landscaped grounds are also fully lighted, wired for sound throughout and completely secured and gated.  We would be glad to arrange a PRIVATE SHOWING for only the most discriminating and qualified buyer.  Offered at $29,000,000 US.  Until next time…Jim Walberg

East Bay Real Estate: Rent vs. Buy? BUY NOW!

Never before the last 15 years has it been less expensive to buy a home versus renting a home!  There are two reasons;  1) Rents have risen so dramatically the past two years because of so many people needing to rent a home because they either can’t afford to purchase a home, or they have lost their home. Landlords have been making a killing!  2) Home prices in the East Bay have been adjusted backwards to almost 2002 pricing.  AND, mortgage interest rates are at a 40 year low – around 4%!

To give you an idea of why today’s interest rates are such a key factor in today’s home buying equation, notice how much of a mortgage you are able to get today compared to 1991 for a $1,700 monthly payment.  With 1991 mortgage interest rates you could secure a $200,000 home loan.  With today’s mortgage interest rates you are able to secure a home loan for $350,000!  Do you now see the home buying power of a 4% interest rate in 2011?  And, it is expected we will have low mortgage rates for up to two more years.

These factors have created a result of the monthly mortgage payments on the median priced East Bay home, including taxes and insurance, to be lower than the average rent levels in our region of the Bay Area.  And, don’t forget, all real estate is local, not national, so neighborhoods can vary with their rental prices.

This moment in the housing industry is one of the most dramatic since the housing downturn.   However, it hasn’t yet increased the demand for home purchases.  Why?  There are several factors still holding people back from purchasing a home;

FEAR: The economy still has so much uncertainty to it, both nationally and globally.  So, often potential home buyers are paralyzed from taking action because of some many unknowns in our future.  There is still fear from consumers that prices may still fall lower so they don’t take action.

STUCK: Some Buyers would like to move to bigger properties, however they are stuck in their current home that has a mortgage more than the home is worth.

COSTS: In addition to taxes and insurance for a home owner, there are other costs – Homeowners Association dues, the maintenance of the home and more.  So, they view renting as less risky.

CAN’T QUALIFY: The potential buyer either doesn’t have enough for the down payment,  or they can’t qualify for a mortgage because of the very tight lending requirements in place today.

In spite of above four reasons why people are not buying homes today, you may want to now seriously consider it.  I can’t remember in my 35+ years of helping people buy and sell homes when all the economic factors have lined up perfectly for home buyer.  In addition, you may be noticing that the current inventory of homes for sale in the East Bay is at the lowest level in years.  So, there are less homes to select from with an increasing Buyer pool who are ready to make a purchase.

If you are thinking of purchasing a home in the next six months, or you still have more questions regarding if it is the right time for you to buy a home, CONTACT The Bay Area Team today. We would be glad to assist with any of your questions.  And, we would even like to apply for the job as your Realtor! Until next time…Jim Walberg.

East Bay Real Estate: Paying It Forward During The Holidays!

The phrase we are focusing on during the Christmas and Holiday Season is, “To whom much is given, much is required!”  I believe that all of us want to give back to the needs of our local communities.  What we have noticed is that most people don’t know where to start, so it gets complicated, and then nothing happens.  Well, you are in luck, I am going to provide you two easy opportunities to make a difference in the lives of people in the East that are less fortunate than any of us.

CONTRA COSTA FOOD BANK: Because of the economic mess the past four years, there are many more families that are on the edge collapse.  The Food Bank has good from serving 70,000 meals a month to 120,000 a month!  Their resources are stretched to the maximum, sometimes going day to day.  Amazingly, the most important food they distribute to families is Peanut Butter – the #1 source of protein for many families!  What they most need are checks.  Because of their relationship with the grocery store industry, they are able to purchase $6.00 of food for every $1.00 that is donated.  WOW!  What an impact a $50 donation can make in the lives of those who need food.

We have food collection barrels in the lobby of our Danville office just waiting for you to stop by and drop off your donations.  I will even send you a letter that we staple to a Trader Joe’s grocery bag and drop off on the front porches of our neighborhood.  ( Trader Joe’s donates as many grocery bags as you will need as part of their support of the local Food Banks in the Bay Area.)  And, the need for meals doesn’t take a vacation in the Summer time, either.  It is when kids are out of school and the only meals some of the get are from the Food Bank.  Contact me if you want to participate in this important community project.

ONE WARM COAT PROJECT: This project supports the Family Services organizations in our local communities.  There are so many families at risk that need the vary basics of warm clothing this Winter.  And, it is not just coats that are needed.  Any warm clothing is what is needed:  coats; sweaters; socks; gloves, and more.  The group that we support with this project is Shelter, Inc. based in the Tri-Valley.  This group is the safe house for women and children who are escaping from abusive relationships.

The benefit of this project is that all it takes is cleaning out our closets and dresser drawers.  All of us have slightly used warm clothing that we haven’t worn in the past year.  In fact, my rule is that if I have not worn specific clothing in the past 12 months, it needs to be donated to someone who can use it.  So, check out your closet and look at all of your clothing with this rule in mind.  Again, contact me if you want a copy of the letter we attach to garbage bags that are dropped off to the front porch of our neighborhood.

So, it is that easy.  It does take a bit of effort, but not much.  And, the effort  that you invest on one or both of these ‘giving back’ projects makes a world of difference in the lives of the families who are in need.  CONTACT me today to see how you can get involved.  Enjoy every moment of your Holiday Season.  Until next time…Jim Walberg

East Bay Real Estate: National Survey Results – FEAR Still Influencing Real Estate!

Fear about home values ranks higher than fear of natural disasters and fire.  As you have noticed fear is even determining the daily results of the stock markets.  In fact, there has not been a time in the past 50 years where the fear-factor has been so high in our country.  Koski Research completed a national survey of 1000+ homeowners with not so surprising results.  Almost half of the homeowners surveyed no longer view owning a home as the American Dream.  The conclusion is that declining home values over the past four years has undermined the confidence of homeowners.   And, don’t forget, FEAR = False Evidence Appearing Real.

NOTE: As I outline more of the survey results it is important to remember that ALL real estate is local. The San Francisco Bay Area is made up of many micro-markets, each of them are performing differently than the other.  So, remember, a National homeowners survey may have no connection to the real estate results happening in your neighborhood.  Our experience is the there has never been a better time to buy a home in the Bay Area.  Interest rates are at record lows and home prices are bargains compared to five years ago.

Below are some of the highlights from the Koski Research survey.

• One of the questions asked in the survey was,  “Is owning a home today the American Dream or a Nightmare?” A majority, 52%, still view it as the American Dream, however 48% viewed is as a Nightmare – the highest percentage in this category in almost 50 years.  The survey also discovered that 56% of homeowners are monitoring their home’s value, and of that group more of them are concerned about their home’s value as opposed to their cholesterol levels – 39% compared to 19%!

• A large majority of respondents said their home is their biggest investment – 62%.  And, 37% believe that buying a home today is a risky investment.  And, 18% said they are not sure they would even recommend homeownership to a young person today.

• The survey found that 67% believe home values have declined in their community in the past  3-years, and that home values will go down 19%,  or won’t change in the next 12 months – 67%.  Only 14% believe home values are likely to go up in the next year.  The homeowners surveyed who purchased their home four to seven years ago were most likely to report that their home is currently worth less than they paid for it – 52%.

• A large majority responded that it is a bad time to sell – 85%,  and a good time to buy – 86%.  This was not a surprise given that most home values have declined over the past five years.  And 23% responded that they are likely to sell their home in less than five years. Home sellers are typically selling their home because of understanding their next purchase will be completed in the same economic environment so their purchase will also be a value compared to five years ago.

Nobody can tell you where home prices are going, however in the Bay Area we are having a much better real estate market than the other 19 major markets in the country.  We probably have up to five years to go before home values come back to levels that were present five years ago.  Other factors on our local economy are the EuroZone crisis, unemployment, our country’s deficit spending,  tight lending requirements, and more.  And, we are part of a Global Village.  What happens in Greece and Italy now impacts our Bay Area economy.

CONTACT ME TODAY for a free home value report.  Glad to be of assistance.  Until next time…Jim Walberg

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