Archive for the 'East Palo Alto real estate' Category
Over the past several years, a significant percentage of my business has been working with investors who buy, fix, and flip REO properties primarily in East Palo Alto and Menlo Park.
Over this time, this market has become much more competitive – “good deals” are much harder to find. Profit margins have sunk. Attractive investment opportunities can still be found but it takes a little longer.
Bigger Pockets reports on the increasing competition for REO investments on a national level.
Please contact me if you want to learn more about REO opportunities on the SF Peninsula.
If you believe your home’s value is below the assessment provided by San Mateo County, you may petition the County to reduce your assessment and thereby reduce your property taxes.
If you have purchased a home within the past 3 or 4 years, its value may very well be below your purchase price.
If this is the case, please go to: http://smcare.org/assessor/homeownerresources/form_declineapp.asp
I need to be clear – just because your home’s value has dropped, you are not automatically entitled to a property tax reduction. So if you bought your home 10 years ago for $800,000 and at the peak it was worth $1,100,000 and now is worth $950,000, you WILL NOT be entitled to a reduction.
One is only entitled to a property tax reduction if the San Mateo County assessment is above what you believe the current market value is.
The request can be made over the web and if you need any comparable sales to bolster your case, just let me know.
Transfer taxes on the sale of real property are collected by San Mateo, Santa Clara, and San Francisco Counties.
These transfer taxes are paid in escrow and are part of buyer and seller closing costs.
Typically, the County transfer tax is $1.10 per $1,000 of value and are generally paid by the seller.
So upon sale of a $500,000 house, the seller will pay a transfer tax of $1.10 x 500 or $550 to the County.
Some cities also have City transfer taxes.
On the San Francisco Peninsula; San Francisco, San Mateo, Palo Alto, Mt. View and San Jose have City transfer taxes.
Generally, city transfer taxes are spilt 50/50 between buyer and seller.
The City transfer tax in Palo Alto, Mt. View, and San Jose is $3.30 per $1000 of value.
So on a $500,000 sale in these cities, the City transfer tax is $3.30 x 500 = $1650.
Buyer pay $825. Seller pays $825.
The City transfer tax in San Mateo is $5.00 per $1,000 of value.
So on a $500,000 sale in San Mateo, the City transfer tax is $5 x 500 = $2500.
Buyer pays $1250. Seller pays $1250.
So if you are buying or selling in those cities, be sure to take into account these City transfer taxes.
The past 18 months I have been quite active with investors who typically pay cash for a foreclosure REO in either East Palo Alto or east Menlo Park.These investors typically fix the property up and place back on the market for sale. These transactions are known as flip due to the short turn-around time from original purchase as an REO and then re-sale to the “end user” – either an owner occupant or long-term investor who wishes to rent the property out.
Last year, FHA had a rule that stated they would NOT fund any purchase of the property that was originally purchased within the past 90 days. In fact, they would not fund a loan on a property when the contract for sale was entered into less than 90 days after to the last purchase date. Read the rest of this entry »
Last summer, I was chosen by Habitat for Humanity to be their exclusive buyer agent for Habitat’s Neighborhood Revitalization Program. Coldwell Banker and I donate the majority of any commissions earned on these purchases back to Habitat.
This Habitat program has been funded in part by contributions from the City of Menlo Park.
The City has considered buying properties in Belle Haven and doing the rehab work. Instead the City has made a wise decision IMHO in helping Habitat with their program. The bottom line is Habitat can do a better job doing what they always have done than the City that has no experience in these types of programs.
This will allow Habitat to continue their mission of restoring abandoned dilapidated homes to provide low cost affordable housing to deserving families.
For those unfamiliar with Habitat’s program, let me provide a little information.
so says Warren Buffet…………
The Real Estate Bloggers report that Warren says:
“within a year or so, residential housing problems should largely be behind us”
“prices will remain below “bubble levels”"
“many families that couldn’t afford to buy an appropriate home a few years ago now find it well with their means”
I would say Don’t bet against Buffet.
I previewed the following East Palo Alto for a client of mine today.
2384 Oakwood Drive 3 bedrooms 2 baths $209,000.
This is a REO property.
One of the most active and strongest markets on the San Francisco Peninsula can be found in the Belle Haven area of Menlo Park and in East Palo Alto.
Most of the listings in these areas are either short sales or foreclosures.
Run-down fixer uppers can be found sometimes below $200,000 and generally between $200,00 and $250,000.
These homes when repaired can rent for $1800 per month or perhaps sold for $300,00 or more.
Buyers need a fair amount of cash to compete in this market but good properties can be found.
I have helped numerous buyers this year in East Palo Alto and Belle Haven area of east Menlo Park purchase REO foreclosure homes and attractive prices.
One client used funds from his IRA to pay cash for a rehabbed home that generates about a 6% cash return on purchase price.
Others clients have purchased REO fixers, rehabbed them, and sold at a profit.
One of my clients, a former tenant, was able to buy their first home in East Palo Alto with FHA financing – amybe $10,000 total cash investment – will receive $8000 first-time buyer credit – and have total fixed ownership monthly payments of like $1700. They are quite happy.
Whether buy, fix and flip or buy and then rent or buy to live in, all present good options in today’s real estate market.
Please contact me at 650 566-5329 or [email protected] to learn more.
I am happy to discuss your options with you – no cost – no obligation.
In my previous few posts, I documented that the number of homes sold in San Carlos Menlo Park and Palo Alto during the second quarter of 2009 was TWICE the number of homes sold in the first quarter of this year.
The numbers tell the story – but stories also illiminate the numbers.
I recently wrote an offer for a buyer client of mine on a property listed listed at $619,000.
My clients offered $670,000 “as is” - had a solid pre-approval and a 35% cash down payment.
This offer had only an appraisal contingency and would close in 30 days.
The buyers had read and approved all reports, inspections, and disclosures.
So basically the offer was as clean an offer as any seller could want.
Offers were due earlier this week in the early afternoon of the offer day.
In the morning, I checked with seller agent and was told there were 8 offers.
By the end of the day, there were 25 offers on this property!
I am not sure what property sold for but it was over $700,00 and I suspect closer to $750,000 by the time the dust settled.
I have heard of other properties priced in the $400,00 to $500,00 range in Redwood City selling for $100,000 over list.
So if you are waiting for the bottom, I think we may have already hit bottom and have started back up.
This is certainly true under $1,000,000 price range.
Habitat for Humanity just entered into contract to purchase a home in the Belle Haven area of Menlo Park.
With the price of bank foreclosure REOs being so low, Habitat has started a program to buy existing homes, rehab them with volunteer labor and turn them over to new owner occupants.
If you have any lender contacts that handle REOs, please let me know as it might be to everyone’s benefit to have some of these REO purchased by Habitat for sale to owner occupants as opposed to selling to investors. (At the present time, most REOs are purchased by investors.)
As the exclusive buyer agent for Habitat in San Mateo County, give me a call and let’s talk.