The numbers for April are finally out from CAR and Freddie Mac. As you can see, the median home prices are starting to come up again… as are the interest rates! Mortgage rates continue to creep up, probably because lenders anticipate that the Fed will raise rates on fears of inflation.

Calif. median home price – April 07: $597,640 (Source: C.A.R.) (note: compared to $580,090 last month)

Calif. highest median home price by C.A.R. region April 07:Santa Barbara So. Coast $1,475,000 (Source: C.A.R.) (note: compared to $1,200,000 last month)

Calif. lowest median home price by C.A.R. region April 07:High Desert $317,420 (Source: C.A.R.) (note: compared to $320,830 last month)

Calif. First-time Buyer Affordability Index – First Quarter 07: 25 percent (Source: C.A.R.) (note: compared to 25 percent last month)

Mortgage rates – week ending 5/24:

• 30-yr. fixed: 6.37%; Fees/points: 0.4% (note: compared to 6.16% and 0.5% points last report)
• 15-yr. fixed: 6.06%; Fees/points: 0.4% (note: compared to 5.87% and 0.5% points last report)
• 1-yr. adjustable: 5.64%; Fees/points: 0.6% (note: compared to 5.43% and 0.7% points last report)

- California Association of Realtors & Freddie Mac

While the city of San Francisco lowers the boom on condo conversions, capitalism and the free market still find a way to beat the system.

Condominium conversions are a way to turn multi-unit buildings into separate residences to be bought and sold at will, however, San Francisco keeps passing laws to make it harder and harder to do this. The solution? Tenancy in common.

In the past, this form of ownership was terribly complicated. However new financing options are making TICs more attractive. So much so that financial institutions and title companies are beginning to give seminars on them.

Goldstein, Gellman, Melbostad, Gibson and Harris, LLP are sponsoring a FREE workshop on Thursday, June 7, 2007 from 6:30 – 8:30 PM at the Fort Mason Center, Building A in the Golden Gate Conference Room. Topics include:

• TIC agreements
• Mortgage assumptions
• Seller carry-back loans
• Refinancing upon partial resale (one of the biggest issues when one of the owners wants out)
• NEW fractional TIC mortgages
• Approving prospective TIC parties
• New and future legislation updates
• Condominium conversion issues
• Landlord-tenant issues
• Title and escrow issues in TIC resales
• Unlimited Q&A

Reservations are required, so contact Jeannie Q Gant of Financial Title Company at 1388 Sutter St., #1220. She can be reached by e-mail at jgant@financialtitle.com or by phone at 415-215-7146. Tell her Janis Stone or Christine Serventi invited you.

- Janis Stone

SFResidence is part of the TRI Coldwell Banker office at 1699 Van Ness in San Francisco which 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.

We can’t say it enough… inventory! It’s just not there. Properties are selling faster than we can get them on the market. In our meeting today, many agents have buyers needs with nothing to show them. As a result, the past several months have created an increasingly frenzied market which could spiral out of control if more homes don’t come on the market this summer. Well just have to wait and see.

Here are the numbers for this week:

5/23/07

• 5 new listings (average price $1,774,600 – low $929,000, high $4,495,000)
• 18 ratified sales (pending) (average price $1,586,555.56 – low $285,000, high $6,300,000)
• 6 closed sales (sold) (average price $1,360,833.33 – low $470,000, high $3,500,000)
• 1 reduced ($729,900)

- Janis Stone

This is a dramatic video (30-seconds, very short) about how to deal with a common kitchen fire … oil in a frying pan. The water, being heavier than the oil, sinks to the bottom where it instantly becomes superheated. The explosive force of the steam blows the burning oil up and out. Inside the confines of a kitchen, the fire ball hits the ceiling and fills the entire room.

- Mick Orton

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

Almost 700 homes were held open in celebration of our Great American Open Home Event, and most all areas reported excellent attendance. The event provided us the opportunity to showcase a wide variety of listings throughout our communities, and the potential buyers were out in full force. One Half Moon Bay property saw a surprising 80 visitors, and a Millbrae home drew over 130 potential buyers. In the City, it was the typical “double-park Sunday-scramble” as Buyers attempted to get in as many Opens as time permitted.

The upper-tier properties are still seeing strong activity in most areas, but in areas where inventory is higher, buyers are better referred to as “window shoppers.” More prevalent in our outer East and North Bay offices, these Buyers are looking at everything available, but are difficult to pin down when it comes time to write an offer. In areas where inventory is tighter, pre-emptive and multiple offer situations are happening in more than half of the reported sales. There were 5 offers on a San Mateo property that went for substantially more than the $2.5 million list price. Menlo Park reports a pre-emptive property that went for 20% over asking. The Lombard office in the City reported every sale this week either in multiple or pre-emptive offers. Market Street and SF Lakeside reported 16 out of 26 were in multiple offers. SF Noriega offices states a fixer in Inner Richmond district had 17 offers and went more than $100,000 over asking. From Burlingame to San Mateo, the past week’s more than 50 closings in MLS were showing roughly 85% sold at list price or greater.

The past two week’s office reports have included more comments regarding transactions being re-negotiated prior to the closing, and some occurrences of deals falling through. Back-up offers can be key for Sellers in many of these situations. In some cases, a Buyer is simply looking for a small consideration prior to close, in others it may be a full-blown case of Buyer’s remorse. Strong listing and selling Agents are helping their customers stay focused on the main objectives in Buying or Selling.

Of the offices reporting, listing inventory remained steady for 12, increased for eight and decreased for six. Sales activity remained comfortably steady for a whopping 16 offices. It increased for eight offices, and decreased in only two.

- 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.

Recently Princeton Capital announced that they were now offering expanded fractional TIC financing, thus enabling individuals buy and sell at their leisure. Not so in the past, since previously it was required that all owners participate in the new mortgage when others wanted to buy in our get out of the property.

Another feature is that up to 90% financing is available with no mortgage insurance with loan sizes up to $2 million. There are other features that make this program attractive to TIC owners or potential TIC buyers. You should call Eric Wood of Princeton Capital to get more information.

Stacey C. Fleece, CFA
Senior Loan Consultant
Princeton Capital
415.229.1228 (office)
415.596.6069 (mobile)
staceyfleece@princetoncap.com

Dennis Kowalski
(415) 229-1241 (office)

Stay tuned for more information on Tenancies in Common (TIC). Tomorrow we post TIC Frequently Asked Questions.

- Mick Orton

The number 49 seems to be a recurring theme with San Francisco. The football team is the 49ers, named for the prospectors who invaded the area during the Gold Rush. And in San Francisco, there is the 49-mile Scenic Drive. Yahoo Travel says this about it:

This self-guided automobile tour is a great way to see San Francisco at your own pace. You follow the distinctive signs displaying seagulls pointing the way along The Bay City’s streets as you visit the diverse neighborhoods that make San Francisco a unique treasure. From Chinatown to Fisherman’s Wharf to Golden Gate Park to Fort Point, there’s no better way to take in the sights than this looping route. Plan at least an afternoon for the drive, more if you want to stop and explore what you find along the way.

San Francisco, CA 94115
Open Hours: 24 hrs

Neighborhood: It all begins at the intersection of Hayes Street and Van Ness Avenue, near City Hall

- 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, Part 16 – Musee Mecanique, Part 17 – Palace of the Legion of Honor, Part 18 – The Octagon House, Part 19 – Holy Virgin Cathedral, Part 20 – San Francisco Ghost Hunt Walking Tour, Part 21 – Yerba Buena Ice Skating & Bowling Center

SFResidence is part of the TRI Coldwell Banker office at 1699 Van Ness in San Francisco which 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.

As you can see by the numbers, properties continue to sell very well. For months we have been reporting ratified sales outpacing new listings and this week is no exception. In our office, ratified deals were over 3 times the number of new listings. Needless to say, our normal summer market has still not arrived. This is good news for sellers bringing properties on the market since demand is high. Reports of multiple offer situations continue to be very common, thus driving selling prices over the asking price. This is true even for multi-million dollar homes! Though the media continues to say the economy is not doing well, our real estate market says otherwise!

Here are the numbers for last week:

5/23/07

• 5 new listings (average price $1,646,600 – low $849,000, high $2,795,000)
• 17 ratified sales (pending) (average price $1,339,882.35 – low $639,000, high $3,585,000)
• 15 closed sales (sold) (average price $1,478,366.67 – low $585,000, high $3,598,500)
• 1 back on market ($2,150,000)

- Janis Stone

A reader asks: As a first time buyer, how much information and what type of questions will a real estate agent ask me in regards to my finances?

Our reply: A good agent can help you structure the best transaction for you if they understand how much down payment you have to work with and what payments you can afford. They will work with a loan broker to get you the best loan for your needs. For this reason, they need to know how much money you have for a down payment, if you are borrowing money from a relative or getting a gift from a relative and what your monthly income is and what payment you have to meet each month. It is also helpful to know if you expect a large bonus or raise in your job.

If you are getting a gift from a relative there is paperwork the lender must have from the relative that they gift is not to be repaid. It is very important to get this information before making an offer.

I once had a situation where a buyer told me his parents were going to give him the down payment. We went out looking for property and found a condo he loved. We made an offer with a loan contingency, but when he went to his parents they refused to give him the money. We cancelled the transaction but the sellers refused to refund his deposit (even though he had a loan contingency), and he had to hire an attorney to get his deposit refunded. In the end it cost him seveal thousand dollars because he did not have his financing in order before making the offer.

- Janis Stone

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 fact that the stock market keeps shooting into record territory is not helping home loan rates which worsened last week.

…home loan rates worsened by about .125% across the board. What happened?

Here’s the story – money invested out in the financial markets generally flows back and forth between Stocks and Bonds. This means that when Stocks are doing well, money is flowing out of Bonds as investors move their “safe” holdings into what they hope are winning positions in the Stock market. On the other hand, when the Stock market takes a turn for the worse, money flows right back out of Stocks and right back over into “safe haven” Bonds. This happens over and over, and is true on a large and small scale; from individual investors on up to massive institutional investors…the mindset is exactly the same.

As the Stock market has rocketed higher in recent days, investors want to get in on the action, and that money has to come from somewhere…and that’s right, it’s coming from Bonds. And when money is pulled out of Bonds, it means that Bond prices worsen, and home loan rates move higher like they did last week.What should have helped Bonds was a friendly Consumer Price Index report, showing that inflation appears to be moderating. Inflation is the arch-enemy of Bonds, which deliver an investor a fixed return – the value of which is eroded by inflation. But just like the 97-pound weaklings wimpy friend at the beach, the good news on inflation wasn’t strong enough to help Bonds or home loan rates regain their legs… Read more.

- Foster Weeks