Foster Weeks does a weekly mortgage update.
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“So what’s the Fed up to? Here is the key – Tolerance vs. Patience. The Fed will not tolerate inflation above 2%…even at the expense of the economy. However, they are trying to exercise patience, as they know that it takes time for the impact of their past rate hikes to filter through the economy and fight inflation, normally between 6-9 months. So the Fed has been patient since their last hike on June 29th, waiting for inflation to decline…but inflation has been stubbornly persistent, and the patience is wearing thin on some Fed members.

The Fed’s favorite measure of inflation, the Personal Consumption Expenditure Index, hits first thing Monday, and will take special significance following this week’s action. If inflation does not begin to move lower towards the Fed’s target, expect more hikes. But this week’s tame talk on the prospects of lower inflation and slower economic growth ahead gave Bonds a boost higher, and home loan rates were unchanged to improved by .125%.”… read on.

- Foster Weeks
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In a related story, MoneyNews reports:

Fed holds rates steady, maintains inflation warning

WASHINGTON (MarketWatch) — The Federal Reserve decided to remain on the sidelines Wednesday, keeping interest rates steady but leaving the door open for further increases if inflation does not behave.

The Federal Open Market Committee voted to hold overnight interest rates steady at 5.25%.
It was the third straight meeting with no change in monetary policy. It follows rate hikes at an unprecedented 17 consecutive policy-setting meetings that brought overnight rates from a decades-low of 1% to 5.25%.

The wording of the announcement from the FOMC was little changed from the September statement. The committee added a forward-looking phrase and took out language suggesting that high energy and commodity prices had the potential to add to inflationary pressures.

“Economic growth has slowed over the course of the year, partly reflecting a cooling of the housing market,” the statement said. “Going forward, the economy seems likely to expand at a moderate pace.” Read the full statement.

Read the rest of the article here.

- MarketWatch

Avram Goldman, President and COO of Coldwell Banker, San Francisco Bay Area said in his latest weekly report:

“Finally, the diet is kicking in—-inventories are shrinking. Forty percent of our offices reported diminishing inventories and only eighteen percent reported inventories increasing. The rest were steady. Those sellers that do not have a pressing need to sell are either staying put or leasing their homes.

“San Francisco and the Peninsula overall have seen a boost in sales. Twelve of fifteen offices reported having multiple offers. Some as high as 50%. We are noticing a modest fall surge. This also includes Sonoma County which has come to life. Sellers have become more accustomed to what it takes to sell. Pricing and preparation are keys. Two-thirds of our offices experienced multiple offers over the past week. In the Ingleside district of San Francisco a listing priced at $549,000 had 20 offers and went well over asking. The East Bay still remains a bit sluggish, as well as the Monterey Peninsula.

“Buyers are out in force. An open home in Ladera had over 100 groups. Buyers are still not making quick decisions, but they seem more poised to make offers. Transactions take longer to put together and require more work to keep together. Patience is a virtue to creating a sale. The upper end appears to be warming up. We had a $5 million sale in our Menlo Park Santa Cruz office.

“Have we stabilized? Has the market found equilibrium? Only time will tell. The last two months of 2005 slowed. If the next two months exceed open sales from last year there may be a marked shift. Keep tuned.

“The numbers for the week are as follows: 5 offices showed increasing inventories, 14 steady and 12 decreasing—sales activity looked like this 6 offices increasing, 18 steady and 7 decreasing.”

- Avram Goldman

* For an e-mail alert when this report is updated, send a note to info@SFResidence.com with “weekly market report” in the subject line.

The Castro as described on the SFResidence neighborhood guide:

“The Castro district, the haven of the gay and lesbian community has the landmark Castro Theater where viewers line up to see such drag queen specials as “Sound of Music” sing alongs. After the World War II many of the dishonorable discharged soldiers due to their sexual orientation remained in San Francisco known for its’ tolerance and diversity since the Gold Rush days rather than return to mid-western homes known for their intolerance of gays, blacks, etc. The gentrification of this working class district began in the 60′s and 70′s when well-educated middle-class white gay men were drawn to the Victorian architecture of the Castro and 18th Street area of Eureka Valley. Check out the “Crusin the Castro” walking tour written by Trevor Hailey if you wish to learn about the colorful history. Or just walk along the Castro and experience the trendy shops, mainstream restaurants, leather bars and clubs side-by-side, etc. filled with alternative lifestyle individuals.”

The San Francisco Chronicle says:

“If only the Mexican land barons and European homesteaders who built the Castro district could see it — and the price of its real estate — today. What was once dairy farms and dirt roads is now one of the city’s most vibrant and cohesive communities, saturated with stylish shops and bars so popular that patrons spill out onto the street. Irish, German, and Scandinavian immigrants came to the outskirts of San Francisco in search of cheap land, which became bona fide suburbs after 1887 when the Market Street Cable Railway linked Eureka Valley, as it was then called, with the rest of the city. Thanks to these homesteaders, who built large, handsome Victorian houses for their large families, today’s residents have someplace to pour their money, and the vast majority of the neighborhood’s classic homes have been lovingly and artfully restored…”

Read the rest of the article here.

Other highlights on this page include:

• Best time to go
• Sights & Culture
• Food & Drink
• Shopping
• Nightlife

- San Francisco Chronicle

For more information on other neighborhoods and street maps visit our website.

- Mick Orton

Previous Neighborhoods

Hello,

I just found unmoderated comments to postings on our blog all the way back in September. We apologize to those of you who took the time to write comments to our posts and thought we were ignoring you.

We are supposed to get e-mail alerts when comments are submitted, but apparently there is a KINK in the system. We are looking into this problem and promise we will do our best to not let it happen again!

In closing, all comments (except those that were mortgage advertisements) were approved and should appear shortly.

- Mick Orton

As we reported earlier, the San Francisco Association of Realtors plans to discontinue the public side of its website. However, you will always be able to search available listings FREE from the SFResidence website.

- Mick Orton

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With REALTOR® members’ interests in mind and after thoughtful consideration, the board of directors of the San Francisco Association of REALTORS® (SFAR) has voted to remove public access to MLS listing information on the Association-operated website, www.sfarmls.com. The action is being taken to drive traffic now received by sfarmls.com to broker websites in an effort to establish REALTORS® as the first point of contact for consumers looking for real property in San Francisco and the Northern Peninsula. The action will become effective on January 1, 2007.

In the past several years there has been an alarming movement of consumers from broker websites to the public MLS site. To make the site less appealing to consumers but to preserve its usefulness as a source of listing information, the Association attempted to delay posting new listings to the site by one week. Unfortunately, Rapattoni Corporation, operator of the site, could not accommodate the request.

Leading firms in the city have reported that in surveys of buyers they have represented, an overwhelming majority found the property they ultimately purchased not on the firm’s website but on sfarmls.com.

Today, under the Association’s IDX (internet data exchange) policy, it is possible for any broker participating in SFARMLS to duplicate the listing information currently found on sfarmls.com on his or her own website. The policy is set forth in SFARMLS’ Rules and Regulations at Section 12.16.

The Association has approved several vendors that can set up an IDX site for any broker participating in SFARMLS. The cost is not significant. But if having a website with MLS information does not appeal to a broker, realtor.com, the site operated by the National Association of REALTORS®, will continue to display listing information from San Francisco and the Northern Peninsula, as well as other areas around the United States.

Set forth below are a set of questions and answers that members may find useful in understanding how the discontinuance of public access to sfarmls.com will affect them.
* * * * *
Q: When did SFAR begin operating a public MLS website?
A: When SFAR launched Rapattoni MLS in July of 2002, a public MLS website was included in the package. Although many of the brokers in SFARMLS were already displaying MLS listing information on their websites under the Association’s IDX policy, many were not so the Association agreed to maintain a public site until there were a greater number of broker websites with listing information. Now that nearly all brokers in SFARMLS have their own IDX sites, there is no longer a need to provide this service.

Q: What is IDX?
A: IDX stands for Internet Data Exchange, and is a standard developed by NAR for brokers (and MLSs) to display listing information on their websites to the public. IDX is intended to be an advertising vehicle for brokers. IDX information includes only publicly-viewable fields, and does not include any “agent-only” information such as agent remarks, showing information, such as lockbox codes, days on market, or contact information. Not all listings in the MLS are available in IDX feeds.

Q: Why don’t we just keep the public MLS website up? My clients really like it!
A: There are two main reasons for discontinuing public access to sfarmls.com: First, there is the reason stated above. Second, there is the recognition that the listing information belongs to the broker, not to SFARMLS, and that many (if not most) brokers feel that the public site detracts from their efforts to attract consumers to their own sites. Every broker who uses IDX has the EXACT SAME INFORMATION on their site as SFARMLS currently has on its public site.

Q: I like the idea of a trusted, neutral source of information for the consumer. Where do I send my clients now?
A: There are strict rules preventing brokers from indiscriminately removing individual listings from the IDX feed they get for their websites. Familiarize yourself with the rules governing IDX display of listing information, and you can easily educate your clients. Your clients can receive all of the listings they have come to expect from your broker website. Alternatively, listing information is available at www.realtor.com.

Q: Where do my clients go now to see all of the listings in the MLS?
A: It is a common misconception that the public side of www.sfarmls.com contains all of the listings in SFARMLS. Your clients have never had access to all of the listings on SFARMLS’ publicly accessible website.

Some brokers have internet applications for their clients where, after logging onto a portal, the client has access to all of the listings. These applications are available from third-party vendors for brokers and agents who have not developed the internet applications themselves. To use these applications to access the full listing inventory, the consumer needs to have a relationship with the broker or agent using the application. Taking down the public access to www.sfarmls.com will not change this policy.

Q: I have the Rapattoni search framed on my broker or agent website. Will this be turned off, too?
A: No. The only thing that will change is the elimination of public access to www.sfarmls.com. The same search window will continue to be available as a framed solution for both brokers and agents.

Q: I’m a broker without a company website. What are my options for getting a site that displays IDX listing information?
A: See the attached list for the names of vendors who can provide brokers with a basic website that displays IDX listing information.

Q: What are some of the benefits of removing the public MLS site?
A: First, as mentioned above, the goal is to drive traffic that currently is going to www.sfarmls.com back to broker and agent websites. This will result in many more eyeballs on broker and agent brands and more exposure for them and the services they offer. SFARMLS’ public MLS site really does not do anything to serve brokers and agents other than to provide free access to the listing information that brokers and agents have worked so hard to procure.Second, the MLS (and the display of listing information) was not designed for the public. The purpose of the MLS is clearly stated in the MLS rules: “…a facility for the orderly correlation and dissemination of listing information among the participants so that they may better serve their clients, customers, and the public.” The connection with the public should come from broker and agent websites, which are designed to display the information in a consumer-friendly format. Remember, this is the same information that is currently available at sfarmls.com. There are no fewer listings on a broker’s site than there are currently on the public SFARMLS site.

Q: But the public site gave my listings additional exposure, no?
A: The public will continue to seek listing information on the internet, and the
consumer will still find a broker and agent’s listings no matter what broker or agent site they look at, provided they have marked “yes” in the IDX field when uploading the listing to SFARMLS.

Q: What do I tell my clients? Where can they search the MLS?
A: Just send them to your broker or agent website. And, if your broker site does not currently contain IDX listing information, contact (or have your broker contact, if you are an agent) one of the vendors already approved by the Association. Having IDX information on your site is not only a chance to connect with your clients, but a chance to build your brand by reminding your clients of the services you provide.

Q: When will the public MLS site be taken down?
A: By motion of the SFAR Board of Directors, the public site will come down on January 1, 2007.

Q: What will happen when a visitor clicks on www.sfarmls.com after January 1, 2007?
A: The user will see the following message:
“Technologies surrounding the management of listing information have made public access to the information through the Association obsolete. The information is now available on many of the websites operated by broker participants of SFARMLS.
“To find a site that suits your needs, go to www.sfrealtors.com and use the ‘Find a REALTOR®’ tool.”Please accept our apologies for any inconvenience that you may encounter in transitioning to these websites.”

- San Francisco Association of Realtors

Though it never got that bad here, Alan Greenspan reported yesterday in MoneyNews that housing woes are probably behind us. In the same issue was a report that home prices have plunged almost 10%, the most it 35 years! Fortunately, San Francisco seemed to be insulated from this drop. Though we have admittedly noticed a slowdown, prices seem to have held relatively well. Here are the articles:

- Mick Orton
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Home Prices Plunge by Most in 35 Years

The median price of a new home plunged 9.7 percent in September from a year ago, the largest drop in more than 35 years, reports the Commerce Department.

The median home price dropped to $217,000 in September from $239,300 in August. That was the lowest median price since September 2004. The 9.7 percent plunge was the sharpest year-over-year decline since December 1970.

The plunge in new home prices follows a record plunge in existing home prices. As MoneyNews told readers yesterday, the 2.5 percent year-over-year decline in existing home prices was the biggest in the National Association of Realtor’s nearly 40-year record.

Clearly home prices across the board are in the midst of a serious correction, one which our sister publication, Financial Intelligence Report, told readers about months ago. Both Sir John Templeton and Yale Professor and real estate expert Robert Shiller told FIR readers that they expected the housing market correction to result in prices plunging up to 40 percent. And, unfortunately, it looks like their predictions will be spot on. Read more.

- NewsMax
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Greenspan Says Housing Woes ‘Probably Behind Us’

Former Federal Reserve Chairman Alan Greenspan, the chief architect of the housing bubble, said Thursday that the housing market isn’t in dire straits.

“Most of the negatives in housing are probably behind us,” Greenspan told a conference sponsored by the Commercial Finance Association. “The fourth quarter should be reasonably good, certainly better than the third quarter.”

Greenspan retired as Fed Chairman in February of this year. Greenspan slashed interest rates from 6 percent in January 2001 to 1 percent in June 2003 to avoid a recession following the bursting tech bubble. In that low interest rate environment, the housing sector surged.
“There are early signs of stabilization (in housing),” Greenspan tells his audience. But hedged his prediction by saying of the housing slump, “It’s not over.” Read more.

- NewsMax

Diamond Heights as described on the SFResidence neighborhood guide:

The Diamond Heights area offers sunshine and total panoramic views from the north and southeast of downtown, the East Bay and west the Pacific Ocean . It is an affordable area of San Francisco for young families, students, artists and professionals with its modest single-family homes, apartments and condos. The nearby Noe Valley and Diamond Heights Shopping Center provides the residents an array of shops and restaurants to patronize.

For more information on other neighborhoods and street maps visit our website.

- Mick Orton

 Previous Neighborhoods

A reader asks:

How do I know how much to offer on a house that I want to buy?

Our reply:

Your real estate agent should be the key to that question. They are not suppose to tell you exactly what to offer but to give you information on what properties have sold for in the neighborhood and what makes the home you like worth more or less than the “comparable sales”. Another factor in knowing what to offer is the motivation of the seller and the experience of the seller’s agent.

Your agent can often obtain information from the listing agent as to why the seller is selling, how long the property has been on the market and if they have had any offers. The answers to these and other questions can be extremely valuable information for an experienced agent to use in advising you as to how to structure your offer to make your offer desirable to the seller. Sometimes the terms that you offer a seller can be more important than the price.

For instance I have had a buyer offer to let a seller occupy the property after the close of escrow at no cost to the seller, and even though they did not offer the highest price the seller accepted their offer over the others. It gave the seller peace of mind that they had time to find a new place to live, yet knew that their house had really sold so they had the money in their hands before they packed up and moved.

- Janis Stone

Foster Weeks does a weekly mortgage update.
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“…the Dow cracked another historic high, closing above 12,000 last week…and believe it or not, did so on the anniversary of “Black Monday” in 1987, when the Dow plunged by 508 points and suffered it’s second largest loss in history. The strong stock gains sure seem to indicate that investors continue to feel good about the US economy…which perhaps has achieved that rare feat of a “soft landing”, slowing down without actually stalling out.

“The economic reports of last week were mixed, but underscored a continuous message – that the US economy is still cooking along with some strength, and certainly exceeding most analysts’ expectations. And most all the recent reports cover the bases in bearing this out – housing numbers remain better than expected, employment is still reasonably strong, the stock market is roaring away…and as a result, inflation continues to be hotter than anticipated…”"… read on.

- Foster Weeks

A reader asks:

I am looking into buying a TIC unit in San Francisco. The unit is tenant occupied and the tenants are month to month. I would like the unit to be vacant if I purchase the property. What are my options? Can I write an offer requesting the unit to be delivered vacant?

Answer:

Your options in San Francisco are very limited since we have rent control. First of all if you are in contract to buy a property in San Francisco that is tenant occupied you should contact an attorney who specializes in the rent control law in San Francisco. The rent control law changes often and new rulings make old assumptions false!! And it is a very complicated law. That is the only advice you should rely upon.

But generally speaking you cannot ask an owner to deliver the unit vacant if the tenant in the unit is in good standing– pays rent on time, etc.

There are very few ways to evict a tenant. So if you want a unit to be vacant when you purchase it you should find a unit that is already vacant to buy. But if you want to buy a unit that is tenant occupied and the tenant does not have “protected” status then you have the right to give 30 day notice to vacate if you intend upon occupying the unit as your primary residence and there is no other unit in the building that has had an OMI (owner move in) eviction. But you should use an attorney for this process so that it is done properly.

Please check our blog for past articles on tenancy in common and rent control.

- Janis Stone