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.

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”

Click here for full article.

I would say Don’t bet against Buffet.

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.

There is lot of data about the local real estate market out there.

Much of it is conflicting and one really needs to pay attention to what the data SPECIFICALLY measures.

So I am going to write about what I see and am experiencing on a first hand basis in my own business and in my office.

The past few weeks, my office has averaged about 15 sales per week.

During the first three months of the year, I would say my office weekly sales were more like 5 to 7 per week.

In the past few weeks, my office has sold some property at very high prices – $6M, $4M, and $3M.

That being said, the upper end of the market is still much weaker than the lower end.

In the past week, I wrote 4 offers for my buyer clients and 1 was accepted - the other 3 lost out in multiple offer situations. This offers were in the entry level price range.

This increased market activity is due to several factors in my humble opinion:

1. Buyers are feeling a little more confident about their jobs and the economy.

While the economy is still weak, the attitude is much more positive NOW than it was in October and November 2008. When the stock market was dropping like a rock and our wonderful leaders in Washington DC (Not!) were preaching doom and gloom, many of us were worried about whether our economic/financial system would survive as we know it. I believe at the present time, most of us believe we will survive – that some tough times are still ahead but that our economic and financial systems will not collapse.

2. Sellers are getting more realistic about prices. Buyers are getting to believe prices are attractive.

Sellers are always about 6 to 9 months behind the buyers – ie the buyers know the market has changed while the sellers refuse to accept reality and hope for the market when there wer 10 offers for every listing.

3. Interest rates are about as low as they can go.

For months, buyers have been wiating for rates to drop and they have. But I think it is now apparent that rates will not go much lower if at all.

We are not out of the woods yet. But things look better than they were 6 months ago.

There are some good buys out there!

Teresa Boardman of St Paul Real Estate – ps she is a great photographer – recently wrote a post about “move-up” buyers in her market want to buy but since they existing home is underwater they can not sell their existing home. Hence they are unable to buy.
Many of her comments about the entry level being the strongest portion of the market with the “move-up” market being very slow or non-existent applies to the market on the San Francisco Peninsula.
Many first-time buyers are getting into the market – taking advantage of lower prices, very low rates and tax credits. Most sales are at the low end of the price spectrum with foreclosure REOs being a large percentage of all current sales. Hence median and average prices continue to go down.
The “move-up” buyer is sitting on the fence. Unlike your area, it is NOT because these potential “move-up” buyers are “under water” but rather they do not have confidence in the economy or the market to make a move-up in a market where moving up means selling for $1.5M and buying for $2M. These folks are just not interested in taking on $500K in additional debt when things look very uncertain. In addition since the price of their home has dropped, they may no longer have enough equity in their current home to put the 20% to 25% down needed to buy and finance their new home with a jumbo mortgage. So they are not “underwater” but lack the down payment to buy the larger house. I believe the “fear” factor is the bigger issue but lack of equity to make the downpayment on their purchase also contributes to the lack of activity in the move-up market.
Arn

That is the $64Million question on many folks’ minds.

Here is my “take”:
In my San Francisco Peninsula market, I would say:
Are there good values to be found? Yes.
Are we at botttom? Probably not. I expect contiuned downward pressure on prices. (In most San Francisco Peninsula cites, values are down maybe 10% to 20% from the peak in 06/07)
Is it a good time to buy? Yes: 1)  if you find a house you  really like  in the community where you want to put down roots 2) you have a long-term perspective – say 10 years and 3) your job situtation is pretty stable and 4) you buy comfortably within your financial means – this is not the time to stretch.

Jay Thompson The Phoenix Real Estate Guy provides a similar perspective on the Phoenix market which has been hit much much harder than our own market.

What say you?

What do my Homescopes blog buddies around Northen California have to say?

Until today, Fannie Mae had a rule that they would not buy mortgages from borrowers who had five or more real estate loans – or perhaps more accurately stated – mortgages from borrows that had loans on five or more properties.

Fannie Mae changed this rule today:

Per Fannie Mae announcement 09-02:

Multiple Mortgages to the Same Borrower
To support prudent lending for housing investment, Fannie Mae is changing our current limit of four financed properties per borrower. We will allow five to ten financed properties per borrower, with certain eligibility and underwriting requirements, including a 720 minimum credit score and 70-75% maximum LTV/CLTV/HCLTV (depending on the transaction and property type). The requirements apply to any loan being delivered to Fannie Mae, regardless of whether Fannie Mae is the investor on the borrower’s other mortgages.

I have recently written several posts stating my belief this is a great market for first-time buyers or for first-time investors.

This Fannie Mae rule change will make it easier for investors to make additional real estate investments.

Due to price decreases and interest rate decreases, invesotrs can now buy property in certain areas of the San Francisco Peninsula with 20% down and have a break-even cash flow. This was impossible two years ago.

In more expensive areas, the numbers are also better than they were two years ago but will require 30% to 35% down.

I have contacts with real estate brokers throughout the country – Dallas, Raleigh, Austin, Phoenix, Indianapolis, Sacramento, San Diego, and the Bid Island. If you are looking for wloer downpayments with greater cash flow, these areas are worth a look.

And do not forget, you can use 401(K) and IRA funds to purchase real estate so if you are tired of stock market gyrations, this is an option to consider.

I have just listed 125 Tynan Way, Portola Valley.

List price is $1,700,000.

 This 3 bedroom 2 bath home is located on 2 acres at the top of Woodsaide Highlands.

 Virtual tour