Mike's Real Estate Blog

Why are there so many houses for sale in Bernal

2008-06-19T10:28:00.000-07:00

As of today, there are 32 single family homes on the market in Bernal Heights, and its been in the last month or so, up to 35 homes. That's quite a lot and it certainly shows in the time on the market. To put some perspective on things, last year at this time there were more like 15 to 17 houses for sale at any time in the spring and the year before that it topped out in the 20s.

Are things really bad ? I've heard tell that it takes about 30 to 35 houses on the market to make a buyers market in bernal, but I just rules of thumb are always a bit simpler that reality. I took a look at the map of all of the active listings in Bernal and counted the ones that were one or two blocks away from either US101, or Rt280. I included streets like holiday, franconia, 800 block of peralta, Justin in St Mary's Park and anything on or south of crescent. There were a few homes that I would consider a bit too close to Mission, but I didn't count those. Just the ones near the highways, or too close to the projects or crescent. I counted 18 that were Geographically challenged. that's 56% for just a small sliver of the area of our neighborhood.

The difference in price between these houses is interesting too. In the highway group, the price per square foot is $534/sqft while the hill and north-west averages $669, yet the average total price is higher for the highway group since the average size is much larger average ~1400 sq ft vs ~1100 in the later group. Days on the market (which is not a good measure because it does not measure days until sold, but some point in time) is 51 vs 49. which is not much difference.

In all I think that the market is dropping for everyone; I've seen lots of great deals this year above Cortland and on really great streets and locations. Further, if we are comparing to last year, it would not be reasonable to say that on any normal year there would be 14 listings on the hill and just 1 or 2 close to the highway. Inventory is definitely up across the board. Though, it certainly is interesting to see that such a small portion of Bernal makes up the greatest share of the active listings.

SF Mayor appoints new head of housing authority

2008-06-12T10:42:00.000-07:00

Mayor Newsom Just appointed a new head of the housing authority in San Francisco. Great job Gavin. Its so nice to see someone actually doing something proactive and positive to approach the problems of housing costs for lower income San Franciscans, rather than taking aim at particular groups of business men (and women). If the likes of the board of supervisors and the SF tenants Union would stop trying to grab from the industrious and give indiscriminately to tenants who need subsidy or not, but rather support programs which provide assistance to those who need help, life would not be such a difficult place to exist for those in the middle.

Well, enough preaching, and back to the point. Good job Mayor. Now, lets hope that this new guy actually lives up to his reputation.

2008-05-01T21:36:00.000-07:00

Oh my god.. Its been over a year since I posted on this blog. wow, how time flies :]

Well I now work at "Home San Francisco" a small broker in Bernal Heights. I've also narrowed my focus and I head a group (consisting of .... me) which represents investors and owners of apartment and mixed use buildings. We're just in the midst of creating a name for said group so stay tuned. I'll try to keep you up to date.

Rental Advice

2007-10-10T21:36:00.001-07:00

I belong to a local parents group / email list and recently replied to
a woman's request for help regarding some troubles she'd had finding an
apartment for herself and 2 kids:

I'm searching for a new place to live for myself and my two girls, but
I'm starting to get the distinct impression that landlords are less
than thrilled about my children. (One woman told me over the phone
that I wasn't a good candidate because I was a single mom and she
didn't think I was going to pay the rent. How she decided that without
any knowledge of my income or expenses was beyond me.)

Are there any renters on the list? Has anyone encountered problems
with trying to move the family into a new place? Any suggestions?

I offered the following advice:

As a realtor and landlord I know it is illegal to discriminate on the
basis of familial status. On the other hand, some people (landlords) do
discriminate. I would suggest that a couple of things impress
landlords:

1) most kids are relatively well behaved, meet the landlord at the
property along w/ your kids (when the are well rested and well fed &
happy) and show her/him that they are well behaved and they are not
screaming banshies.
2) getting the appointment to see the apartment does not require you to
say that you have two kids.
3) references from former landlords go a long way, as do credit reports
and employment references. on the other hand, fiends, relatives, the
fact that you go to church, or sob stories, etc. do not.
4) finally, presentation, matters a lot: speaking well, making sure
your kids are not crying in the background when you are on the phone,
nice appearance and clean car etc, mean a lot to a landlord. Think
about it, if you care for your car and yourself, there is a hope that
you will care for the landlords property. If you don't, the landlord
won't rent to you.

I'm not a big fan of the tenants union, they are reactionary and a
negative force in this city. I'd point you to the SF Rent board before I
went to the TU. I would also point you in the direction of the california
apartment association, which has a "renters" section on their website
(caanet.org) or the SF apartment association. I don't know if they have
a list of landlords that have availabilities, but their members are the
most educated about the law and proactive about doing business in a
fair way, so they are the landlords that I would want to rent from.

I'll just offer this last bit of advice: you don't want to rent to
someone who is going to discriminate against you on the basis that you
have kids. Those people are not good landlords anyhow.

best of luck

Another list member replied to my post this way:

As a realtor and a landlord, of course Michael Sundius is "not a big
fan of the tenants union." In a city where housing is so expensive
and homelessness (including for working families) so extensive, for a
landlord to call the tenants union "reactionary" and "a negative
force" is as predictable as it is ludicrous. For anyone who cannot
afford to own their own home in the city and who must therefore rent,
the tenants union is the best source of information and support
available. I say this as a rentor who has lived and rented in San
Francisco for 23 years, with impeccable references from a number of
landlords, and as a Certified Law Student currently working on a
landlord/tenant case.

Michael's suggested response to illegal discrimination is not to
oppose the discrimination but to avoid dealing with those people. If
the civil rights movement had followed that advice Black people would
still be sitting in the back of the bus.

And poof.. we have ourselves the age old disagreement. I'll add the
rest as comments for readability. Please I'd love to hear your thoughts
about this and the opportunity to air mine in as well.

2007-09-30T21:43:00.000-07:00

I have to smile at reading that a Berkeley Rent Board member (Chris Kavenaugh) was arrested
for fraud recently: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/09/22/BA0ASBT8I.DTL

and even better, he was discovered because he was making a stink because he wanted to maintain property rights that he (as a tenant) was not entitled to. It just goes to show, these tenant activists will go to any length to squat on others property.
s

2007-04-04T14:46:00.000-07:00

I posted the Bernal Heights real estate statistics for March today. There was a big drop off in number of sales for the 3 month trailing averages since December was such a big month, yet the distribution of sales over the last 3 months for # of bedrooms and styles of homes was largely unchanged. Victorians and 3 bedroom homes being the bigges sellers, though ironically only one 3br Victorian has sold in the last 3 months.

The number of homes for the month was up just 1 to 10 and average price was up 5.5% for the month to $868k and the number of homes on the market and in contract were up 15% so it does seem that the market is starting to pick up nicely. We have also seen several properties come onto the market in the first few days of April and expect to see a further jump in listings this week after Easter when the season really starts. Inventory is still fairly low for this time of year at 11 homes yet buyers are still acting very cautious; thus the market seems pretty balanced between buyers and sellers.

Nothing new in the multi-unit market, no new sales occurred thus the numbers for the 3 month average are down though the prices are up just under 9% to $787k. There are a few new listings of multi unit buildings and one is in contract. It seems as though multi unit buildings across SF have not seen buyers responding and I feel that the inventory is growing.

Condo and TIC prices and numbers were basically stable in March and the condo factor remained not significant.

Again, I feel that while the market in Bernal Heights and San Francisco is much smaller than in years before, its is very well balanced between buyers and Sellers. Properties priced low will still get bid up, yet over priced properties will stay on the market waiting for the perfect buyer. I feel that while extremely cautious, there are still many buyers lurking in the wings and this is causing the SF market to be extremely efficient; now, its even more difficult to find that great bargan property. For Multi-unit and investment properties I wonder if we'll see a bit of a dip in prices as inventory continues to inch up. In all rents continue to rise so sellers of multi units may continue to be increasingly patient. Single family homes, on the other hand, seem to be getting snapped up quite quickly.

Props in Play

2007-03-28T12:07:00.000-07:00

So from time to time I'll post this. The following is a list of properties that I know are in play, but may not be listed so I won't give all the details for every property right here, for people to get an idea if that is what they are looking for. If you are interested in any of these you should probably give me a call. I always am coming across new stuff like this so if you call please ask if there is anything else that has come up recently.

1) 107 Anderson Classic Victorian near the top of Bernal Hill on the south side. 4 Br 1 Ba. $899k
2) 2 unit (both 1br 1ba) Current owner is just finishing the rehab and its looking totally sweet. Spectacular location near shopping, public transport. Totally turnkey. Totally awesome, wait till you see the pent-house and roof deck
3) San Francisco corner market / liquor store that does a good business
4) 6 room Victorian in Bernal on upper part of Crescent. dining room converted to 3rd bedroom 1 ba plus unwarrented 1/2 bath. nice looking building.
5) Mid century 2br 1 bath fixer. between Jarboe and Cortland. Easy walk to shops and transport. a wonderful neighborhood.
6) Bernal home on double lot, again easy walk to shops transport and wonderful neighborhood.
7) Bernal Mixed use.

Do you know any other's that are in play? do you have any interest in the ones listed above? Call me.

Habitat for Humanity

2007-02-26T12:27:00.000-08:00

Well, on friday, February 23, I volunteered a day of my time to help the folks at Habitat for Humanity build a house for a family in need. I'd been wanting to do this for a while now, and finally just told everyone that I was going and doing it. Well, I had a great time. I suggest everyone takes a day every month or so and puts in a couple of hours of time for a good cause. The world would be a much better place if we all did, not just for those in need but for those who have as well.

Two more cents worth.

Bonnie Spindler's Got It Wrong

2007-02-24T22:41:00.000-08:00

I noticed an advertisement that Bonnie Spinder has in the SF Examiner. It Says "Buy, Sell, Repeat. Then Retire."

She's got it wrong. The best way to get there is "Buy, Work Hard, Repeat. Then Retire". Selling is not the necessary component. In fact it only delays the end goal. If you keep selling the properties that you buy, then you'll keep paying Bonnie lots of commissions which will allow her to keep purchasing those big full page ads in the newspaper, but it won't get you any closer to your retirement. On the other hand, if you keep the property, rent it out or use it for a business, then it will generate revenue which can initially pay down your mortgage, and ultimately pay for the miathai's that you'll be ordering on the beach during your retirement.

Don't get me wrong, I've sold a building or two in my career, and there are good reasons to do so. For one, if the building doesn't cashflow, then dump it. Or if you need the money for a bigger more profitable investment, or for your kids education. Well, we do what we gotta do. But in retrospect, I don't think I really needed to ever sell any of the properties that I sold.

I also want to mention the work hard part. Its not just like flipping pan cakes here. Real Estate investment is not a free lunch and to get to the end goal, you can't really be living off of your investments (otherwise it would be retire, then buy, sell .... it doesn't work that way). This means that while you are buying and buying you need to be working your 1st job. Even if you 1st job is a Real Estate agent like me or Bonnie, or a contractor or a street sweeper. You gotta eat while you are biulding the equity in your properties.

Further, don't think that Bonnie is just mis-informed herself, she may sell lots of properties, but can't believe that she doesn't have a pile of rental properties that she's keeping for the long haul. And I know she's working hard..... to get you to sell that property to her.

That's just one investors opinion: Think and justify your actions before you sell it.

Ups and Downs of Inexpensive Housing is SF

2007-02-09T14:39:00.000-08:00

The following was I response I sent to Carol Lloyd who writes Surreal Real Estate regarding one of her recent posts. I take a particular interest in housing for the rest of us in this world and I thought this would be useful for agents as well as buyers and sellers of TICs:

Carol,

Your article a couple of weeks ago about the BMR studio in the fancy condo development down town was very interesting. I found it somewhat apropos, as I recently encountered some problems with a similar foundation while working on a deal to purchase a 1br TIC for one of my clients. It is 1 of 4 in a newly developed TIC building, which is to close next week.

Well, when at last the 4th partner got into contract and all the buyers were able to meet. One of the buyers (not my client) pulled me aside and told me that my client was "the weak link" since she was putting only 5% down and that he wanted assurance that my client had the reserves to cover unforeseen expenses like replacement of the aging roof. I'm felt a bit pressured, but standing my ground I told that buyer that my client was as strong as anyone in the group having a higher credit score than everyone else, a smaller loan than others (because of the particular unit she is buying) and she has plenty of reserves. I said she's got a better credit score than you!

In response I was told "I have a net-worth over$10 million" in a tone that suggested how dare I cast doubt on him. At this point I recognized the problem. While my client had less equity than the others, she was actually more closely aligned to the other two buyers in terms of financial status than this guy who had the $10M in the bank. Really, everyone except george lets call him, was really just one broken leg away from being in the poor house, and barely able to scrape together the down on a 1br TIC as their first owned home. George, on the other hand, was buying this as a 2nd home for his spouse to stay while in SF.

hmmm. I wondered to myself and to my client what other sorts of troubles could arise out of such a situation; Everyone (with good reason) loves the place, though, so the minor financial worries were brushed aside in favor of progress.

Now its time to get insurance... I did the leg work for the group since my pushing people to get quotes of their own resulted in silence; I presented the group with a quote for insurance. Well, surprise surprise, our fiend is back in 2 minutes pushing a quote of his own, except the personal liability and personal property coverage is next to minimal!!! why would that be? possibly that George has lots of coverage for those things though the policy on his primary residence... Should the rest of the group be exposed to that extra risk? Is this the last of the incompatibilities of this group? My client is no dummy and is going into this with eyes open of course.

Not sure why I relay this story to you. I guess the moral of both of our stories here, is not to push segregation between rich and poor, or one group and another, but to educate people about agreements that they are entering into: you as a journalist, and me as a advocate for my clients. Really, its a reminder that anyone buying/selling real estate should have a good real estate agent as well as read the Chronicle every week.

ps: I held off sending this to you until the deal closed. Anyway, the story has a happy ending, as they all got what they wanted and are now living happily ever after.

New Year Update and Old Year Wrap

2007-01-20T12:27:00.000-08:00

Well 2006 is done, and it was a wonderful and educational year for me. I'm grateful for the opportunity to have learned and help where I could and I believe that it has already begun to lead to a very successful 2007.

In the past year I have worked on projects both for sellers and buyers in Multi-Unit, Single Family Homes, and Tenants In Common deals. I attended classes on appraisal, financing, and other aspects of real estate investment and read several books on business organization, entrepreneurship, and proactive sales. I expanded my network to several investor clients, people within the SF County Housing Authority, Habitat for Humanity, and other Lenders, and most importantly many neighbors in my home neighborhood of Bernal Heights. All the while doing what I do and having fun.

However the biggest achievement of 2006 was my break from a dual career as a Software Engineering Consultant / Real Estate Investment Specialist. I gave up the software all together because I felt that my effectiveness at managing 2 careers at once was less that excellent. I was not able to be exceptional at both jobs at once, so my focusing solely on real estate has boosted the level of my learning and performance in terms of commissions but also (and more importantly) the level of service to my clients and tenants. This has been a very difficult step to make since I had never really been sure of my future direction until recently. I knew that I felt that I needed to change and do something different than engineering, however I could really not put my finger on exactly why. My interest is very much in real estate, but why? without the answer, I could not really be sure that I had made the correct choice. Should I really have left the high dollar contacts for real estate? was that the right decision? was it a mistake? This delema has haunted me for the last 7 years, ever since I left the big experiment with the Dot Com Startup. I could write forever about this (I won't); the essence of my point is that only after taking my leap of faith and following my instincts, was I really able to answer the haunting question: "why am I doing this?" and put my fears to rest. The answer is my mission. The answer is about gratification. The answer is about helping people. My first career was for me. The gratification was in the overcoming of technical challenges. Solving engineering problems is difficult, but in the mess of it, the challenge is fun for a while. Finding the fastest way to do something or fixing the most bug in the software or being in charge of designing this or that widget. It was really exciting, for a while, but it was only self-gratifying. Eventually, instead of being gratifying because it was difficult, it just became difficult.

This is not the way to live. I had said it to myself and others many times before, I had even said it in my mission statement on my website. I say that: "I am doing this to help people and to give back some of the things I've learned about investing about real estate". I hadn't put it together really. That is the answer to the big WHY. Why am I taking the direction I am taking in my career? Because helping and working with people is more gratifying than working as an engineer building machines that do impersonal tasks.

Well that is a lot of discourse on a simple thought, but its big for me and I hope it is enlightening for you. I felt it important that my clients and my network knows what I'm up to and what I'm about.

SO....

This year I am poised to focus my attention to working on sales of businesses, mixed use properties, and more multi-unit properties as well as serving local home buyers and sellers. I currently have a couple deals under contract and I'm pleased with the prospects of the coming year.

I plan to continue my education by taking more required classes for my brokers license, and by self directed reading into investing in real estate, marketing, and business and finance.

Finally, I hope to include many more people in my network. If you are reading this, please let me know and help me build my network of interested and interesting people.

Good Luck to you in the new year.

Said it once I'll Say it again

2006-12-14T16:15:00.000-08:00

Zillow has just started listing properties for free. The San Francisco Association of Realtors has just tightened its grip on its technologically inferior MLS. Times are changing.

Holiday RE Market is Just Fine

2006-12-14T15:32:00.000-08:00

People have been asking me: "oh so how's the market", expecting to hear me complain about prices going down and no buyers out there.

"No complaints here! I'm as busy as ever and the markets doing just fine." Its true. The SF real estate market is rolling on in a perfectly. In-fact what I've seen in the last month or so is that buyers are moving in droves for fairly priced properties. I've seen multiple offers and properties sell in a matter of days. The thing that is different is that unrealistically priced properties are sitting on the market for an indefinite period of time and are either taken off the market or have their price dropped until its put in line with buyers expectations.

This all sounds perfect for me, perfect for my buyer clients, and you know what, its OK for sellers too. Yes, it would be nice if we could all win the lottery, but lets talk sense: sellers are getting fair prices for their properties, and if they price the property correctly, they'll still attract multiple offers. This will give them the leverage they need to make sure they are not nickled and dimed to death. Fortunately enough, my buyers can still work the greedy sellers or those represented by foolish agents who do not know enough to list their properties realistically. Because this market is rather balanced, its a new game, people are all learning what the new rules are and for those who are well positioned, the world is yours to claim.

Well positioned, I mean represented by a thoughtful experienced team, not leveraged to the hilt, and even better sitting on cash that could be mobilized to quickly take advantage of opportunities as they present themselves.

Here are the trends I'm seeing now:
1) Sellers who price properties correctly will receive multiple offers and maintain the leverage during the escrow phase of the transaction.

2) Sellers who price their properties over buyers expectations will wait forever until getting an offer, and then will be forced to lower their price below what it might have sold for if they had be realistic in the first place. A stale listing goes under the radar and is very often missed.

3) Rents are rising and many sellers have been just removing their properties from the market since they are realizing that even after having to refinance and incur higher debt service, they can survive on an increased rent.

4) The lowest priced properties are still going to have stable prices. Our electorate gave one more blow to first time buyers this fall (see my previous post), and as I just said rents are going up.

5) Buyers should be looking for the tired sellers who are just at the breaking point and ready to settle for a lower price. Work those people hard while in contract, and be patient and leave the emotion at the door. Don't be timid right now, be ready to walk, there are plenty of sellers out there.

6) I've seen lots of great deals in some off the radar places: Portola, and Sunnyside neighborhoods for example.

I always say that its never too late to have a great childhood; likewise, now is not too late to clean up your balance sheet and move ahead on your path to a better life. Now is really a exciting time in the real estate market. If you don't have any thoughts about what is going on around you or if you hadn't thought about what it means to you for this next year. Come and talk to me to find out how to take advantage of the times.

Tenants Union tightens noose around renters looking to buy

2006-11-13T13:23:00.000-08:00

On November 7th our city electorate was duped again by the Tenants
Union. Our one simple hope for lower income first time buyer home
ownership has been made thousands of dollars more expensive by
Proposition H. The intention of the proposition is to keep the rental
stock from being depleted by requiring building owners to pay
extraordinary relocation benefits to tenants who's rental agreements or
leases are terminated through previously agreed upon terms written in
their contract and provided for by law. These will not be handled by
developers, they are simply passed on to consumers: 1st time buyers of
TICs, New renters, and mom-n-pop landlords who use rentals as their
only income.

The whole thing works like this. Our city electorate is mainly made up
of renters. Thus, they [renters] have created a powerful partnership
between the powers that be in the city council, the Tenants Union and
the Rent Board. The Council drafts legislation and ballot measures that
steal money and rights of property owners and pass them equally to all
renters with little regard to financial or physical status. The TU
lobbies the electorate with biased rhetoric and the biased rent board
does the dirty work and the actual bullying of the property owners.

Yet the only reasonable argument for these subsidies to renters is that
"they [the renters] are the poor and disabled and needy" and must have
help to survive and live in such an expensive city. The fact is, that
these entitlements are not distributed only to the poor nor are they
given only by the rich or even the able. They are distributed to the
"renters" and given by the "property owners"!!! Further, they keep
changing the rules; taking more from the minority and giving to the
majority. There are housing terrorists essentially hiding in the midst
of our less fortunate.

Why does this discrepancy exist? It is because of lazy, shortsighted,
marginalized and on-the-take lawmakers like supervisors Mirkarimi,
Ammiano, Daly, Duffy, McGoldrick, Peskin, and Sandoval.

Lazy because they have over the years cobbled, patched and re-patched
a rental housing market regulation based on the assumption that renter
== poor and property owner == rich. They have tried to use this as a
means of distributing welfare at the expense of the well being of
families who want to live and grow in the city they love.

Shortsighted because they have failed to see the consequences of their
actions, among them low home ownership rates and flight of working
middle class families from SF.

Marginalized because San Francisco and California has for many years
allowed powerful lobbies such as Big Energy, the Tenants Union and the
like to sway voters with money and adds. The Tenants Union paid for all
9 arguments that were provided for Proposition in our voter Guide, more
than the SF Association of Realtors, the SF Apartment Association, SF
Small Apartment Owner Association (and there were a couple of others I
think) combined. How can a single well funded lobby push legislation
though so easily.

These supervisors are being paid by all of us and they are unfairly
supporting some extremely well to do renters in this city. Think of all
of the young professionals who come to SF because it is the center of
fun for young adults in northern california. They graduate from
expensive schools, move here, sew their oats here, take and take. And
then?: they marry, have families and move because they can afford
private school for the kids or a house but not both. The ones that are
left are those who do not have families (the responsible ones buy a
home the rest keep suckling the rent control tit). Yet the sups keep
their jobs because they pander to the Tenants Union.

It is also because of ignorant, apathetic, and reactionary voters:

They are ignorant, and I say this of myself as much as anyone. I know
considerable amount about real estate because that is my career it is
my job to know, but ask me about school bonds, or the effects of a
parking tax, or I remember one year some time ago I was asked to decide
how best to resolve problems with our water system and the hetch-hetchy
damn. I am not qualified for most of these issues and I consider myself
a fairly well read and intelligent voter. average, yet ignorant (this
goes back to the marginalization of the lawmakers above). Put the sups
to work they should be making these hard decisions.. (and we should be
spending our time and energy vetting them).

Apathetic, because of the low voter turn out.. come on guys 45%? most
of us don't care. I was talking to some people at an open-house sunday,
they were looking to buy a home and did not know about this proposition
[H] and that it would likely raise the price of real estate in SF.

Reactionary, because here in SF, with the slightest cry from a big
lobby such as the TU, we go and throw the baby out with the bath water.

I really see this mentality of Ballot Propositions and rental subsidies
as a problem that is seriously affecting our ability to raise families
here in one of the most wonderful cities in the world. My feeling is
that we must start by helping without hurting. what ever happened to
Win-Win? It is never the easy way but it is the best way. My wife and I
often have complete opposite opinions, but the best decisions we have
ever made were those where we struggled and found the third path that
led us to where we are today.

Next we have to pay much more attention to our children. A few weeks
ago I was saddened to see that after the violence that occurred at the
annual Castro Halloween extravaganza people were pointing fingers and
saying this group or that group were responsible. On commenter on a
blog said that "it was all those young hooligans fault no one under 21
should be allowed". When I was a kid, Halloween was for the kids, my
dad came home from work early, we paraded around the neighborhood (with
my Dad) and we took in tons of loot (ok, candy). The paper said that SF
City hired 500 extra cops to patrol the Castro, The only Peace Officer
I saw on Cortland Ave that night in the midst the hundreds if not
thousands of kids and parents was a 3 foot Sheriff with a cool Stetson
hat a shinny badge, and a plastic gun.... and no body got shot.

If there is a shortage of rental housing, then lets build some more of
it, and responsibly. I think we have begun to do some excellent work in
Bayview and Hunters point. Lets continue the job. Lets create and help
everyone to win, not just the renters.

Now that the family has taken back Bernal Hill, lets take back the rest
of the city: Vote, participate in the public school system, volenteer
for Habitat for Humanity, anything. There are many reasons to be a home
owner and many to be a renter. but don't let the Rent Trap decide for
you, stand on your own, and make up your own mind. I can help... can
you?

C Michael Sundius
Brown Bear Realty
303 Cortland Ave
San Francisco, CA 94110
(415)608-0121
realtor@sundius.com
http://www.sundius.com/brownbear

Vote

2006-11-07T13:53:00.000-08:00

Please vote for Housing Ownership!!!!

Pricing, Pricing, PRICING

2006-09-27T09:37:00.000-07:00

About 6 months ago, I was reading a lot of articles that said something to the effect of: as the market slows down it will become very important to price properties very carefully. Pricing it too high will make it sit forever and then the seller will likely have to lower the price below where he could have sold it in the first place had it been priced correctly. I said this myself and the market proved it to be correct.

More recently, I've heard/read similar rhetoric with a slight modification. Now the line goes: pricing and marketing are extremely important in order to ensure that your property sells.
I still agree, however what I have been seeing from many properties represented by beautiful agents driving fancy cars, is that they have subconsciously left out the first part of the admonishment above and are simply relying on their looks, staging and some cookies in the oven to make people buy.

We'll see if this really plays out in the market, but my guess is that people who hire these agents and are not careful about how they price their properties will pay for it.

More Fuel For the Fire

2006-09-20T16:27:00.000-07:00

As most real estate agents do, I look at listings every day. I'm always eyeing potential deals for my clients. In doing so, I've noticed recently that there are many that either expire (i.e. the listing time limit runs out and thus the listing agent looses the right to sell the property as per the listing contract) or they are withdrawn explicitly by the seller. Either way the property goes off the market.

In times past, agents would simply resign up their client and maybe make a few improvements to the property, do some snazzy advertising or even once in a great while lower the price to some catch-all price (say $599K) and they masses would converge and some brave sole would step up to the plate and buy the darned property. Then everyone would say: "What an idot. That property isn't worth all that money"

Ahh, sellers don't have it so good. OR DO THEY? Because, I'm the kind of a guy that wants to know why and how things work (even markets, I just can't get that engineer midset out of my head), I ventured to call some the the loosing agents. "What's up with that property?" I ask. "When's it comming back on the market?". And the new answer? nope, its not: "next week at a lower price", its more like this: "The owner rented it out and is not going to sell [sigh]". So for all of those people who are waiting for the onslaught of bank forclosures on the brave soles I mentioned above who held their noses and bought the properties that the masses thought were overpriced, well keep waiting.

You see this is more evidence that rents are going up. Many of those who have bought in these headdy days gone by now, are doing just fine. As interest rates are easing back down, I think that a good deal of those people on the edge can refinance and raise their rents and keep it in the black for the next 10 years.

I guess the lesson to be learned, is keep a cool head about you. Don't panic, if your gonna sell, sell for a good reason. Otherwise, keep growing that portfolio of properties. Prices have certainly cooled off in the last year, and as rents continue to rise, and interest rates increases settle down a bit, I see some good opportunities for those with the mind to take advantage.

One more 2 cent opinion from Mike

Newly Condo-ed duplex in bernal for sale

2006-09-05T15:53:00.000-07:00

Here's the inside info report right now in bernal.

there is a 2unit condo between mission and holly park that is going on the market in the next week or so. Its a sweet building edwardian style with amazing hardwood floors, a nice back yard. huge 2 car side by side garage, 2br 1bath in each unit.

There's also a TIC on cortland which I don't think is yet on MLS yet.
That is a 3Br unit with outdoor space. Its rehab is just being finished now.

If you are interested you might give me a call or send me email:
mike Sundius 415 608-0121

Too many of us

2006-08-31T09:48:00.000-07:00

So it had to happen. I was in Starbucks yesterday waiting to meet my client. I had arrived early, and caller her to ask what kind of coffee she wanted; I had 2 grande espresso drinks on the table and a big stack of disclosures in a legal sized folder for my client to review and sign. There wasn't any doubt what my occupation. A couple of minutes later my client walks in, and I hear the guy at the next table say to whoever he was talking to on the phone: "I gotta go, one of my clients just walked in". He stood up and was ready to say hi, when she sat down at my table and thanked me for the Carmel Macciato with soy milk and no whip cream.

Well, who's to say that she doesn't have a separate deal going with him. I don't doubt that she does. I just thought it was funny.

Wallmart, Home Depot, and my vacation to Germany

2006-08-20T12:06:00.000-07:00

What do all of these things have to do with real estate? well, really they all concern banks. We all know (or should know anyhow) that the Banker, not a real estate agent is the 1st person anyone needs to talk to when they decide that its time to purchase a peice of real estate.

Ironically, while the bank does know this, most buyers don't. The first thought the typical buyer has when making the big leap, is better go talk to a Realtor. hmmmm. That's good for real estate agents, since if buyer thinks he should first talk with a real estate agent, then the real estate agent has a chance to set the hook in and direct what banker the buyer goes to, instead of the other way around.

But of course, right now, banks are somewhat special here in good old America. You see, not only do you have to be a "bank" and follow "banking rules" if you do things like lend money and take deposits and other "banking" things; Also, if you are indeed a bank, you can't do other things like sell groceries, toilets, BBQ grills, cheap plastic stuff from China, and most importantly, you can't sell real estate. Banks are banks and everything else is not a bank. yup we keep it simple.

Of course, things are getting more complicated. And this is where the likes of Wallmart and Home Depot come in. You see, recently they have recently requested permission from the federal goverment to start to do some banking things. Both want to set up banks so that they can extend credit to their customers to buy more shit from China. And since that will cut the [established] banks out of the loop, they'll make more money!!! Good for the evil big box stores and bad for the [not so] poor banks. Further, while Wallmart "says" they are not going to offer customers more traditional banking service in their one stop money sucking wearhouses, once they are given the "banking" status, who's to stop them.

Now I have no particular love for the big banks of this world, but I think generally we can all agree that this development is not such a good thing since this all would give big boxers yet another strangle hold on our wallets and make every house in this land fill even faster with the same HomeDepot/Wallmart crap that we see all too often these days. And our little groceries, and hardware stores and other individual stores will have one more struggle to struggle against.

Ah, so we've got the HD and W-Mart connections, how does my vacation fit in here? You see when I was in the German countryside recently, I found it very interesting that every time I found the bank in one of these small towns (looking for the ATM), what do you think I saw plastered in their window right in the center of town? A whole bunch of real estate listings!!! wow, I thought "Here in Germany, the banks sell real estate, cool".

Well, I never knew that; never even dreamed that a bank might go there. I'm guessing since our federal system has not allowed banks to get into other industries, that most people, buyers/sellers don't know that either. But the banks do. Oh they know. And this is how banks will make lemonaide out of the lemons that are being passed on from the big boxers. They will pass the lemons on to the real estate brokerages. This will force (allow) banks into the real estate sales business and they they will have the first crack at buyers and sellers and be able to bundle financing with houses, which in the short term might lower the cost of purchasing a property, but as we all know, once they have the consumer locked up, prices, fees, cost will go up.

The consumer might not even notice it the likely way things will proceed is not that we'll see listings in bank windows overnight, rather banks will start merging (buying) real estate brokerages. They will partner with the financing part of the bank and eventually, the goal will be to squeeze out the little guys.

Up to now, the none of the big (corprate) brokerages like Caldwell Banker have been able to effectively squeeze the little brokerages like Brown Bear Realty. They have a bit of an advantage in advertising, but since realtors are such an independant bunch and even the agents in the big brokerages mostly do their own thing and advertise individually.

Now however we have the likes of the banks, and the internet companies which are aiming for all of those tastie (read well deserved) commissions that we and the Association of Realtors have been working so hard to keep. I want to be clear, I don't think that the compensation is undeserved, real estate agents work extreemly hard for their pay and it is indeed well deserved as I joked about above. However with the synergy of technology, consolidation of industries, and corprate leverage, there is likely some changes due in the way real estate is sold in the united states.

Think about this for example. E-bay created Pay-Pal to facilitate their huge on line auction business. No other auction business comes close to Ebay for that reason. craigslist is great (I use it more than I use ebay) but without the online payment scheem craigslist is a local thing.

My point is not that we will use Pay-Pal to buy/sell real estate (though that is not far fetched). Rather, and I've long said this about things in general, that when you combine two technologies, or industries, or anythings well, you can get more than the sum of their parts. On the other hand, when a big greedy corporation is mixed in with that combination, lots of time the savings in efficiency will go not back to the consumer, and not back to the poor employee that the consumer deals with (i.e. the real estate agent), but a corperate bank acount and eventually, to the guys who control it. The CEO the Board and the controlling shareholders.

My hope is that the Association of Realtors gets its act together and does the following:
1) It needs better technology for searching and listing properties. It needs to hire some serious software architects to create some effective easy to use software for interfacing to the data. It has to come to grips that control over information is gained by the one who has the best interface. After all the customers as a whole really own the data, not the association of realtors. The internet is all about providing an interface to data that is highly distributed.

2) They need to keep the banks out of the real estate market. Because they will squeeze out the little home town brokerages like brown bear and will make real estate agents into employees instead of independent contractors. Keeping the entreprenurial spirit in the real estate market is very important; that spirit is what drives the best agents to get the most for their clients.

Market Slowdown-Hoedown

2006-07-30T22:30:00.000-07:00

So I was talking with some people today and they were asking about the RE market and what I think of the "slowdown" as if it was such big news. The market has been slowing since mid last july. I was reading an article on line and they were saying the same thing. as if this was a big surprise. http://news.yahoo.com/s/afp/20060730/bs_afp/useconomyproperty
In it they say people in contract now who thought they were in a booming market will be backing out. that's a load of crap. anyone who didn't see this train comming, was not looking around. Sure there's the folk that got on the band wagon late, but if they are that stupid, they'll likely go through with the sale. That's my 2 cents. They go on to say that because of this, the "real" housing inventory is much higher, really, I cannot see the people backing out of deals now, making a big difference on the current inventory.

Later they say that anyone who has any hope of getting out [of the market w/ their skin I suppose] has already got it on the market... They guy talks as if we've all lost our shirts already.

I guess my last point is this: everyone keeps talking about the over built situation. Las Vagas, San Diego, Florida. Well, certainly, San Francisco has built quite a few large scale condos, but SF I feel has really not seen that much building (relative to the other cities I've mentioned). Thus, My feeling is that while supply is up, I don't think it is going to be quite so devestating as some of these other cities. San Francisco, (thanks to our friendly tenants union) will for the forseeable future, be in need of condos. Especially, for those of the small scale variety (i.e. in less than 10 unit buildings).

well that's my 2 cents for the week.

Mike

Inflation, Interest Rates and Real Estate

2006-07-14T11:43:00.000-07:00

I'm no economist, I'm a Real Estate Agent. I see what is happening in the markets that I pay attention to and that's what I know. Its this: For now prices of real estate are holding pretty strong given the relative rise in interets rates. Now there is certainly some lag time between the change in the rates and prices due to the bond like nature of real estate (i.e. price and rates are inversly proportional because real estate is so commonly leveraged by mortgages). However that's not the only factor here. You see, prices of income properties are more closely tied to rents than they are to the cost of money. Everything that I've read says that rents are going up. I consistantly watch rents in Bakersfield and here in San Francisco. I watch vacancy rates and I watch the job market (especially the tech market since my former life was as a software contractor).

The amatures right now are concerned about what prices of properties are going to do in the short term so they are waiting holding off to buy or worse they are buying with risky adjustable rate mortgages. The pros are doing the same as they always do, they are buying the good deals and locking in income streams for the long term.

And Think about this: the people who will be getting killed by those negative amortization and adjustable rate loans will be selling at todays prices to the pros. They'll sell their nice single family home to a guy that was hording his cash and then the'll go and rent somewhere. Maybe rent a house, maybe rent an apartment. they'll have to do it. That is the sad part of the story, however the truth of the matter is that there will continue to be more and more people renting in the near future which means lower vacancy rates and higher rents. All of this is good for the savy investor who has the cash now to lock into a long term investment.

So will prices of real estate hold strong, will they rise slowly, or stay flat or fall? Who really knows. The short of the long is that regardless its a great time to invest in real estate. People who buy good deals today will lock into a (still) historically low interest rate on their loan, and will ride a wave of increasing rents. Its really what all of these baby boomers have been dreaming of. An easy way to latch on to a passive income investment, and ease themselves into retirement over the next 5 to 10 years.

What are the internet realtors up to?

2006-07-14T10:36:00.000-07:00

Well after I published my last posting (I'd been editing it / thinking about it for a week or so) I finally had a bit of time to get throught some of the realtor rags that had been piling on my desk. I try to give them a skim over when I can since each issue usually has one small bit of interesting info -- among all of the mindless realtor ads and fluf about this or that rising starr. Anyway they had an expose with the creators of Zillow, which I thought might be interesting, me being a ex techie. And I love Zillow, its a good product at the right price and very easy to use.

Getting into the meat of the article, they talked about where these guys came from; They are both ex Microsofties and were the ones that started expedia. You know Expedia, the online travel site that put a nail in the coffin of the Travel Agency market? They discussed how Zillow had all this funding and were building a great team of engineers and real estate professionals etc. And they discussed one other thing that was the gem I was looking for in this issue. The guys said several times that they would not discuss the plan for Zillow going forward, but they emphatically denied that they were going after the real estate agent piece of the pie. hmmm. well then, what are they going to do. The dull masses haven't even given it a thought, Zillow is great what more could we want. But these guys are seasoned entrapenures by definition they think big, really big and have the funding and staff to do it. So, what do they want? What are their plans?

My cinical mind says that they are after the tools and information market. They realize that Real estate requires more due dillegence than buying stocks or organizing a vacation. A personal relationship is required for most peoples liking becuase of the following reasons:
1) neighborhoods are very local and it takes a person who lives and works there to provide an understanding of it.
2) real estate buyers demand a level of due dillegence that is not demanded by travelers or stock buyers. that is physical inspections of the property.
3) They are complicated transactions which require constant communication between multiple parties over the course of an extended period of time.
Anyone who has examined the real estate market recognizes these and many more issues. They recognize that the real estate agents (at least the good ones) are doing a good job and add significant and worthwhile value to the process. Its the REALTORS associations and the MLS's that are ripe for picking. The Realtors associations have crappy tools and are loosing control of their prized monopoly on information. I don't want to say that real estate agents will not be affected by all of this, we will, but the association better make way for some competitors and soon because zillow is moving in.

Realtors should get "TECH ACT" together

2006-07-05T15:08:00.000-07:00

So one thing that I can't quite understand is why realtors have the worst of resources for their MLS solution. If you look around on the web today, there are so many web sites related to real estate. Moreover, the ease of use of these free web sites blowes away any MLS site that I've ever seen. Realtor.com or the Rapattoni web interface all just are really lacking. With the amount of money that goes into real estate, compared to the money that is funneled through these free web sites, you might expect that the Realtor's would come up with something better.

Here's what is even worse, Rapattoni has just come out with their next generation web interface, Version 10!!! You would think that many of the problems that existed in the last version would be resolved.. Nope, not one of the fundimental short-commings of that software have been addressed. Lets take a look and see:

1) The first and most glaring example of lazy software development is the fact that they continue to exclude any browser other than Internet Explorer. Hello! not the whole world uses IE. Yes, I will agree that Internet Explorer is a great program, but there are many reasons why someone would opt for a different browser or be forced into useing a different browser.
a) I'm using a Mac, or linux, or BSD computer and IE is not available to me.
b) I don't like Microsoft and want to use Firefox
c) I like some other browser better
d) I'm using an old computer and it does not have (or cannot run) the latest version of IE
what ever the reason is, or might be in the future, there is just no reason to lock ones self into a particular browser.

Rapattoni, says that their solution is workable since only the realtors are required to have IE. The public access and web pointers sent to client are said to workable on other browsers: This is crap since not all realtors use Windows. Further the problem gets worse for their new version of the software. None of the maps are viewable with browsers other IE. That means when a Realtor sends a link to a listing to one if his clients, unless the client is using IE, they will not be able to see its map. I wonder if there are other features that I don't know about, but probably.

Making this work on other browsers, is probably not so difficult, especially, since they went through all of that trouble to redesign the whole thing anyway. It certainly would involve their software developers to ramp up on a new software development package, but come on, this is not that big of a deal.

No doubt the decision was made because they got sold on this microsoft crap and did not even consider the end product or look at alternate solutions.

Their (lame) alternate solution for those who do not use IE is to provide a Citrix Server running their software. This means that everyone who uses a Mac, must log on to Rapattoni's slow servers access MLS there. Thus they must endure other realtors sharing the same compute resource as well as network delays and degraded user interface since high res display would make the network delay untenable. Yuck!
a) Its Slow. you are at the mercy of all the others using the machine and maintenance schedules of their servers
b) you need to do many more clicks just to get the thing up and running, this is critical when you have a client that walks into your office and asks you to see a listing at 123 anderson st.
c) you can't print anything unless you save it to your desktop first. doh.. what a pain.
d) while you can cut and past between other apps, it does not work easily or completely i.e. you couldn't copy a jpeg image or the like.
e) I also suspect the security of such a system since it is always asking you "do you want this other computer to write to your hard drive"
f) I'm sure I could think of a few more if I really wanted to spend the time on this. Lets just say that this is not a real solution to the problem.

2) OK lets get off the IE issue we've beaten it to death. Maps, well Rappittoni's new version does have a mapping feature that allows you to map several properties at once, but come on, hasn't the news gotten out yet that we all like Google's mapping interface a lot better? you can't drag the map around like you can w/ Google Maps. We all stopped using mapquest a couple of years ago.

Further, think of the possibilites, with Google Virtual Earth, (I know microsoft has this too, but google is more open) If Rapattoni used this interface Realtors could load 3d images of the property and provide REAL virtual tours. That's not going to happen anytime soon with rappittoni.

3) The user interface sucks too. Even the new version is crappy. I have this pet peeve about when software companies put a new look on their website or software and don't change any of the fundamental operation of how it works. All of the operations still take too many "clicks" to effect any operations. Going to the contacts and the looking at the automated property searches is a pain. Click the dropdown menu, then go to a page to select which client search you want to review. why can't I just goto a drop down menu of all of my clients? At the very least have a form to search for a client name.

4) Non necessary features, why is there a separate back and forward button, Isn't there one on the browser itself? What's all this stuff about having a task list and date book and contact list. There are great APIs for real PIM software that web applications could hook into, let others do it.. Why did they spend so much effort making their web application something it is not. If they spent half the effort partnering with and researching interfaces with other software, they'd have greatly imporved their results (even better they could have spent that energy on making it work on firefox).

Wouldn't it be cool be able to import from your PIM software clients and then organize them in order of what they are looking for or by likelyhood of them buying etc. Wouldn't it be cool if this web site were able to interface a generic Calander program with your listing escrow so for example it might propmt you for contingency and closing dates and would push them to your calander program.

I must admit there are a few neat features in the rappittoni software, but in all I'd give it low grades because it failed to provide a workable solution for everyone. As the resoruces available to the public become more and more accessable, it is important for Realtors to have the very best in technology in order to maintain our usefullness.

As Realtors, we have only 3 things that allow us to earn our pay:
1) expertese in facilitating deals
2) access to information
3) access to tools

as number 2 and 3 above are eroded away, we have less means to provide our clients the service they expect.

Incentives to Multi Unit Rental Builders.

2006-06-07T23:39:00.000-07:00

Here's a novel idea, instead of rent control and limits on condo conversion, how about incenting the construction of new multi unit rental housing.. even better incent landlords to rent out their properties:

My buddy sent me this article this afternoon. I for one am all for it. Now if we could just get the SF local yokels on board with some similar Ideas.

Owners Don't Run.

2006-06-02T13:23:00.000-07:00

I read an article the other day in the San Francisco Apartment Association Magazine about litter on the streets of San Francisco. Since I agree with the author completely I wanted to point it out here.

http://www.sfaa.org/magazine/archives/06/may/0605.wilson.html

Marc Wilson points out that people litter because they are disenfranchised and have no sense of ownership in their community, he then relates that to the fact that most people who live in SF rent. While, the tenants that I've met here in SF certainly run the gamut of outstanding to the worst sort of citizens, I believe no where else in the world could you find San Francisco's sort of "anti-owner" tenant. That is, some tenants here are of a rare breed whose attitude is driven by the notion that they should be magically given many of the rights of ownership and few if any of the responsibilities. Marc ends by relating this to an upcoming ballot-proposition regarding disclosure of evictions for multi unit housing; I'd like to carry this a step farther and discuss some other problems facing us San Franciscans because of the anti-owner ethic

I have a 1-year-old daughter and I live here in the city in Bernal Heights. Since she has entered our lives there has been a looming question about what we will do when she comes of age to attend 1st grade. I can't turn around these days without seeing an article about "where are all the kids" in San Francisco. The San Francisco Magazine, the Chronicle, realtor’s magazines. It is no doubt a serious problem, however the politicians can't seem to fix the problem. Well, that's because while they must provide the environment for change, they cannot, alone, effect a change for the better. Why? Its not up to them, its up to the owners of San Francisco. Schools are made up of kids and parents and teachers, not politicians, only the true owners can effect a change. Unfortunately, San Francisco voters have this same "anti-owner" attitude about the schools as they do about their housing and the litter on the streets. Thus, since San Franciscans don't own the schools, their problems, or their home, it is very easy to leave -- just cut and run when all the fun is gone.

While I grew up in the sub-urbs in New Jersey, I really can't speak about what growing up in a city has to offer a family except that my wife grew up in Bucharest. She went to the same high school as her mom, she was baptized in the same church as her mom and grandmother, and she lived in (read owned) the house that her great-grandfather built. Talk about ownership. And this was a communist country. A lot has happened to that house, and her old neighborhood since she left and maybe its a topic for another day, but the fact is that hers was a great neighborhood because there was ownership, and others that were taken from the people to make public housing is crumbling still.

Well, again back to San Francisco, and the point is we need more ownership. It used to be the ones who were in charge, where the "landed gentry"; that is those who owned land made the rules. Our system is more even handed now and I am so tired of hearing people complaining about the gentrification of this neighborhood or that one. It seems to me we need a little more "gentrification" if that means that more people own their own homes.

The voters, the politicians, the tenants union in San Francisco have taken the easy way out and we are all reaping what we have sown: Lets put all the burden on a few because they were smart enough to invest in ownership; Lets all try to get something for nothing. Well that only works for a little while my friends and time is running out. Instead of sending kids all of the city for school how about investing in ownership. ALL of our neighbors and ALL of us should be proud of their home, their street, their schools and our needy and more importantly investing in them. No one should be excused from sacrificing a bit of themselves to own San Francisco, its more than a down payment, its an attitude, you can begin by picking up that candy wrapper that was just dropped on the sidewalk:

- Politicians don't pander to the freeloader tenants union, create ownership housing instead.
- Parents don't leave town, stand your ground, be involved in the public schools and own them.
- Tenants don't tell your supervisor rent is too high, tell them that you are tired of renting.
- Everyone make the sacrifice to own a piece of San Francisco.
- Hug a realtor :]

This is the first test post

2005-04-22T16:44:00.000-07:00

test 1234