Eric Wood is a Senior Loan Consultant for Princeton Capital at 1699 Van Ness Avenue, San Francisco, CA 94109.

Ah…the glory days of home buying! Remember back in 2003 when you bought that $800,000 condo, put 5% down and got a 5-year interest only ARM at 4.875% with no points? Sure…the rate on your equity line 2nd lien has gone up a lot over the past four years but your 1st lien is locked for five years…what a steal!

Fast forward to 2007…less than one year left on that ARM and when you hit your adjustable period, the rate would change to LIBOR plus a margin of 2.5%. Based on today’s market, that equates to a whopping 8.75%! But don’t panic – now is the time to consider refinancing out of that ARM into a new ARM or even a 30-year fixed before rates start moving higher. There is still time to get a low rate and the impact to your monthly payment will be significantly less than if you continue to hold your mortgage in the adjustable period.

Let’s look at a real world example on that $800,000 condo you bought in 2003…

Let’s assume your current mortgages breakdown as follows:
That is a 59.5% increase over the current mortgage payments. Yikes! What can we do about this now to prevent such a large jump in payment? Plenty…
Now let’s evaluate current payments versus payment on a new lien. Yes, the rate on the 1st lien will increase. Get with reality…5-year ARM’s are just no longer in the 4.875% range. However, since we are able to roll the liens together into one, the rate on the $120,000 2nd will be much lower on a refinance. If you were to refinance the above loan scenario today, here’s how it could look:

1st lien – $760,000, 5-year ARM interest only @ 5.875% – payment $3,720.83
NO SECOND LIEN
TOTAL MONTHLY MORTGAGE $3,720.83

The monthly increase is only $245 higher than your current financing…and it is over $1,800 LOWER than what your future holds in monthly payments based on your pending adjustable loan…you could even refinance to a 30-year fixed, still save loads off your adjustable payment and lock in the rate for the life of the loan!

Do yourself a favor and start looking into refinancing that mortgage now while rates are still low. There are no guarantees on where rates might be 10 months down the road and you know what they say…a bird in the hand…!

Read what Rick Turley, President of Coldwell Banker, San Francisco/Peninsula says in his latest weekly report:

The Easter and Passover holidays in combination with spring break brought an anticipated cooling of activity in many areas. However, there were a lot of surprises in our markets as well, with hot spots in the communities with the least inventory of new properties.

With the Easter holiday being a notoriously slow one for open houses, the recent influx of groups touring properties was not expected to materialize. But of our more than 240 homes held open, a number of areas saw surprising attendance levels. A $1.9 million listing in Berkeley had a “mob” of people go through. Agents “flocked” to open houses on tour in the Greenbrae area. Redwood City reported an “amazing amount of attendees,” and open houses remain a “hot commodity” in San Francisco. Turnout was also impressive in Burlingame, Palo Alto and Woodside/Portola Valley.

Multiple offers remain highly competitive in a number of areas. An El Cerrito Hills property received nine offers. Larkspur saw a $1.6 million fixer receive four offers and sell well over asking. Palo Alto reports that the majority of their sales are from multiple offer situations. In San Francisco, a Noe Valley home received 26 offers during the week, and the only listing that received only one offer received that pre-emptively. Orinda too is very busy with multiple offer situations.

Listing inventory is still seeing incremental increases in most areas, though not fast enough for the City and much of the Peninsula. Danville actually saw four listings get sold from “coming soon” signs. The Marin market remains “on fire,” with the $2 million range being particularly strong – as one Greenbrae Sales Associate put it, “$2 million is the new $1 million.” I toured new listings in Palo Alto this Friday and felt the very same thing -most of the listings I saw were asking $1.8M to $2.4M. The agents I toured with commented it was the greatest increase for number of new properties on tour in quite some time.

Eight offices saw an increase in listings during the week, while only 5 reported a decrease and 17 indicated steady listing inventory. And while these holidays and the Spring break generally see a slowing in sales, 15 offices maintained steady sales activity, 6 saw an increase and only 9 reported decreased activity.

Buyers would undoubtedly be confused by misleading newspaper articles such as those that appeared in the Chronicle this week. But the reality of Bay Area real estate is that buyers are researching, recognizing and grabbing a good deal when they see one – and are willing to negotiate and fight for properties that are well-priced and in good condition. They continue to recognize the positive value of Bay Area real estate as a long term investment.

- Rick Turley

* 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.

Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports.

The good news is that the economy is doing well. The bad news is that the economy is doing well. Although the Fed left rates alone, fears of inflation sent bonds south and thus rates worsened slightly.

…The market had a busy week on its own…and the Fed took center stage, with the “Minutes” from the last Fed meeting being released, as well as several members out and about on the speaking circuit.

While the Fed speakers didn’t give any market-rattling comments, the Fed Meeting Minutes were a different story. Remember that the Minutes are the “Fed Unplugged”, giving all the commentary between voting and non-voting members, before the carefully crafted formal Policy Statement is released to the public. The Fed intentionally delays the release of the Minutes, so the market has time to interpret and adapt to the Policy Statement itself, before they throw the “off the record” discussion into the mix for review and analysis.

The Minutes revealed that although the decision at the meeting was to leave the Fed Funds Rate unchanged, Fed members remain concerned about inflation, as recent indicators show that inflation is stubbornly remaining at a level above the Fed’s comfort zone of 1 – 2%. Bonds didn’t like the inflationary concerns, and lost some ground…with home loan rates worsening just slightly. The Fed is leaving an open door for more hikes ahead – as well as the possibility of cuts – completely dependent on what the incoming economic data tells them in the coming months. And a highly watched measure of inflation is due out next week – read on to know what to be looking for. Read more.

- Foster Weeks

This was reported recently in a financial newsletter. Be cautious when using your credit cards to purchase.

Thanks for shopping at TJ Maxx…but your credit card info is now fair game.

That’s right, if you shopped at TJ Maxx over the past few years, your credit card may be one of the 45 million – yes 45 million – that was accessed and copied in the biggest data leak ever. The card info was used to make duplicate dummy cards…and those cards were used to buy gift cards at WalMart and Sam’s Club for $400 each, which is under the $500 threshold for showing identification. This is not the first time this has happened. You may recall the DSW Shoe security breach about a year earlier; and like Déjà vu, it’s Déjà DSW all over again. And unfortunately, it’s a good bet that something like this will happen yet again.
You might be saying it’s a good thing you have that security code on the actual card to show that you have it in your possession…but the latest scam is designed especially to gain that information.

Scammers lure you into giving them the security code by impersonating themselves as employees of the credit card company, calling the cardholder, and acting as though fraud has already taken place in hopes that you will give up that precious three digit code. Here is how the call plays out.

The caller identifies himself by name, badge number, and states that the call is from the Security and Fraud Department of Visa or MasterCard. They use the news about TJ Maxx and asked if you have shopped there in the past 4 years…a decent chance you have and have also heard about the data leak.

The caller explains that your card has been flagged for an unusual purchase pattern, he is calling to verify a charge that was made to your account (reads the account number to you), and asks if you made a purchase in the amount of $497.99 to a Marketing company in Arizona for an Anti-Telemarketing Device? When you respond “no” the caller states that a credit will be issued but to issue the credit the caller needs the security code (the three digit code from the back of the card) to process the credit. You innocently pull out the card; give the caller the security code, and minutes later are hit with a charge not a credit in the amount of $497.99. Even though the scammers have your account number, name, and some personal information, this information is not always enough to make purchases and the scammers need the security code.

Should you receive a call that is similar to the description above, take the following steps to protect your identity and your credit:

• Do not give the caller the security code.
• Ask for the caller’s name and terminate the call.
• Call the credit card company immediately, but do not call the number the caller provides.

Additionally, here are a few extra steps you can take to protect your sixteen digit credit card number and personal information:

• Be aware of your surroundings when purchasing merchandise. If the individual behind you in line is crowding your space, cover your credit card information.
• Watch your card when individuals around you in public places have cell phones. Thieves can easily use a cell phone to take a snapshot of your credit card.
• Shred all credit card receipts. Many merchants issue a charge receipt with the full account number and your name. (Editor: CompUSA is one that still takes an imprint of all sales!)
• Don’t leave credit card statements lying around the house or office, file or shred statements once paid as they contain all of the information for a thief to perform this scam.

Musee Mecanique constantly gets high ratings from tourists as a “quirky” home for mechanical games from a time long ago!

Yahoo Travel says this:

A penny for your thoughts? In addition to a melange of penny structures, this quirky, offbeat museum which had originally resided beneath the Cliff House at Pt. Lobos, has a variety of interesting gadgets and knick-knacks. A must-see is the toothpick amusement park, built by San Quentin inmates. Bring a handful of quarters so you can play some of the games, including the miniature antique pinball machines. Visiting the museum is free of charge. Cash only.

Taylor Street and Jefferson StreetSan Francisco, CA 94133
+1 415 346-2000
Open HoursM-F 11a-7p; Sa-Su 10a-8p

Neighborhood: Richmond District

- Mick Orton

Part 1 – Golden Gate Bridge, Part 2 – Alcatraz, Part 3 – Japanese Tea Garden, Part 4 – Cable Cars, Part 5 – Fisherman’s Warf, Part 6 – Exploratorium, Part 7 – Mission Dolores, Part 8 – San Francisco Museum of Modern Art, Part 9 – Lombard Street, Part 10 – Giants Stadium, Part 11 – Mission Cliffs Rock Climbing Center, Part 12 – Beach Blanket Babylon, Part 13 – Palace of Fine Arts, Part 14 – Asian Art Museum, Part 15 – Coit Tower

SFResidence is part of the TRI Coldwell Banker office at 1699 Van Ness in San Francisco is one of the premier offices in the City and has the market share numbers to prove it. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.

Can you say inventory? Once again, the low number of listings is driving the real estate prices higher. For example, this week our office ratified 22 while only listing 9 new properties, and 2 of those were confidential! Is it any wonder that many homes are getting multiple and preemptive offers over the asking price?

While the rest of the country is experiencing a downturn in the real estate market, San Francisco is going just the opposite direction… up, up, up! Our President’s weekly market report confirms what we have been saying… for weeks!

Inventory is unusually low for this time of year. These sales figures reflect a heavier than usual buyer representation for our office.

Here are the numbers for last week:

4/11/07

• 9 new listings (average price $2,086,285.71, 2 confidential – low $525,000, high $4,000,000)
• 22 ratified sales (pending) (average ratified price $1,180,978.64 – low $413,000, high $2,795,000)
• 6 closed sales (sold) (average closed price $1,572,000 – low $875,000, high $2,675,000)

- Janis Stone

Cole Valley as described on the SFResidence neighborhood guide:

…while partly in the Haight-Ashbury and part in the Parnassus neighborhoods, Cole Valley has a character all its own.

SFGate says:

…bordered on the west by Stanyan Street and the Sutro Forest, on the south by Tank Hill and on the east by Clayton Street. Residents are largely families and young professionals, though there is no trace of the snootiness that has affected other parts of the city. Most of the businesses in Cole Valley are of the mom-and-pop variety, in lieu of chain stores or franchises, and shop owners are outwardly supportive of each other. Read more here.

Other features include:

• Sights and Culture
• Food and Drink
• Shopping
• Nightlife

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

- Janis Stone

Previous Neighborhoods

Read what Rick Turley, President of Coldwell Banker, San Francisco/Peninsula says in his latest weekly report:

No April fooling around in the Bay Area real estate market for the week. Serious buyers are making serious offers. Inventory continues to trickle in to San Francisco and the Peninsula, but not fast enough for eager buyers. Most areas of the East and North Bay markets, however, remain steady, but without the traditionally expected deluge of spring listings.

Of the more than 550 homes held open, most were well attended – especially in the City and on the Peninsula – and multiple offers among the well-priced offerings and desirable homes continue to be the norm in all areas. In San Francisco, a home in Noe Valley listed at $925,000 received 14 offers. Another in Inner Sunset district had 20 offers and sold for substantially over the asking price.

The mid-high end market saw another week of increased activity in all areas with Novato, Oakland, San Francisco, Menlo Park and Palo Alto all noting that pre-emptive and multiple offers are the rule of thumb on virtually all listings in the $1.5- 3 million range.

Listing inventory increased for 10 offices, remained steady for 14 offices and declined in 5. Sales activity saw a little up-tick from the previous weeks with an increase reported by 10 offices, steady reported by 14 offices and a decline in 5 offices. Over 240 offers were ratified, and nearly 100 multiple offers were reported.

A note of interest comes from Redwood City, and also discussed recently in Menlo Park, where it seems that open house attendees are relying more on Internet sources than on print media to locate homes to tour. Hopefully, it’s an infectious trend as our Coldwell Banker Internet sites and relationships with innovative technology companies continue to provide information that is more accurate and up-to-date than anything found in the newspapers.

Historically we are experiencing our strongest listing month of the year in April. The amount of new property listings taken in April and May will shape the sales activity we can expect for the summer of 2007. Sellers need to seize this incredible opportunity in today’s market with pent-up Buyer demand and very low interest rates.

- Rick Turley

* 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.

Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports.

Indications are that historically low interest rates for home loans may be finally coming to an end… Read more.

…last Friday, the Department of Labor reported that another 180,000 Americans left the coffee shops and found jobs during the month of March, with another 32,000 jobs added to prior month’s reports. The Unemployment Rate dropped to 4.4%, matching the lowest rate in six years – and Average Hourly Earnings were up as well, rising to $17.22 per hour. So it was all good news for the US job market…but bad news for home loan rates, since a strong labor market can lead to inflation, the arch-enemy of Bonds and home loan rates. On the release, Bond prices slipped lower, causing home loan rates to rise slightly across the board.

And the Fed was watching too…remember that the pop in new job formations and stronger wages creates that risk of further inflation ahead, and this news comes on the heels of a higher read on inflation from the Fed’s most closely watched indicator – The Personal Consumption Expenditure Index. So, despite the media and many “so called” experts saying the Fed has to cut rates soon – don’t expect a cut in the near future, as the Fed’s main priority is controlling inflation… Read more.

- Foster Weeks

Today’s article in the Daily Pundit says what we have been saying for a long time… the San Francisco city government has so many rules and regulations that it makes it hard for people to build new homes. Combine that with rent control, and you can see why things have gotten out of hand. To quote:

Short of removing rent control or drastic free-market surgery on zoning regs in NIMBY neighborhoods, there is little or nothing the City can do to lower housing prices or increase the housing stock…

…Unless and until SF becomes capable of a free-market response to that fact, rather than the usual Big City-Big Government-Big Control methods, housing will continue to be ridiculously high compared to most other places in the U.S.

- Bill Quick, The Daily Pundit