A new home owner called Len Tillem on his Radio talk show today. He bought a house close to San Thomas Expressway for about $800k. The seller wrote in his disclosure that there was no traffic noise so he assumed that it was quiet. He claimed that he only saw the place during the weekend and it was quiet. Now that he moved in he hears the traffic all the time and he is angry at the sellers and the real estate agents. He thinks that he should have paid less for his property or not buy it.

He is rightfully just to be angry at them. It should have been disclosed to him. The agents should have warned him that being close to a freeway there will be noise.

An advice to any buyer who purchases a new property. Always visit the property at all hours of the day. You are going to live there and spend many hours at your new home. Listen to the noises in the area. Some people are sensitive to noises and smells and will be miserable if they hear water, or traffic, or airplanes, or trains, or even dogs barking. You are investing so much money. For many of you this is your largest expense, invest a little time, it doesn’t even cost money. Go there, get out of your car and stand there or walk around the place. Talk to the neighbors. There is always a nice neighbor who would love to tell you everything about the neighborhood. Drive to your work place from that house and drive back as though it was your home. This way you’ll avoid aggravation and live happier in your new home.

To determine where home prices are expected to rise most in the next couple of years,  Forbes.com   looked at projections for housing starts from the National Association of Home Builders and job-growth projections from Moody’s Economy.com.

Forbes identified cities that are likely to be vibrant markets because jobs are increasing and the housing market wasn’t overbuilt during the boom.”The logic is pretty straightforward,” says Mark Zandi, chief economist at Moody’s Economy.com. “People will spend as much on housing as their income will allow them. House prices are very closely tied to household income over the long run when you look at business cycles.

According to Forbes, these are the 10 cities where home prices are most likely to rise:  Albuquerque, Charlotte, N.C.  San Antonio, Texas, Portland, Austin, Texas, Salt Lake City, Utah,  Colorado Springs, Colorado. Minneapolis, Atlanta, Oklahoma City

Source: Forbes.com, Matt Woolsey (08/25/2008)

This sounds great if you were to move there and buy your own home. However, if you are planing to invest in Real Estate in one of these attractive cities with hope for appreciation and good return on investment , by renting your property,  you should check who will live at your property. Can they afford to pay the rent? will they look after your property or trash it? If you have to vacate them and remodel the place every time you have a bad tenant you’ll end up loosing money.

Find a good property manager and be a part of decision making. If the applicants have judgments against them don’t rent your place to them, they will likely live in your place for free, and it will cost you a lot of aggravation and loss on income. It takes at least 2 months to evict the tenants, fix the place and rent it again. During that time you have to keep paying the mortgage, the insurance and taxes. Sometimes you have to hire a lawyer for about $200/hour.  As with every investment, it has it’s risks.

In California the Real Estate Broker is responsible for pre qualifying the buyers, finding a suitable house/property that will fit the needs and budget of the buyer, negotiate the best price and terms, write the contract which is the purchase agreement, coordinate with the lender to get the best loan, inspect and check the property with professional inspectors, follow up and make sure all needed work be completed as per the contract, pay attention to every detail and educate the buyers through the process, walk through the check the property before releasing the down payment funds, check the closing statement and follow up with the home warranty and advice for many years to come. For Sellers, the Broker has to help decide on a marketable price, help prepare the house like a bride for her wedding day, do all property inspections, help the seller fill up all the disclosures, market the house and advertise in all possible ways, hold open house every weekend until the house sells, show it whenever needed, help maintain the house clean and tidy, choose the best suitable buyer, negotiate the best price and terms, check the lender and follow-up with every step of the sale process, and the contract and help deliver the house clean and ready to the next owners.

There are many other roles a broker has that are not written, like staging, moving furniture around, decorate with fresh flower arrangements, and be a real friend.

With the new situation of the mortgage companies and banks that are going under, like Indibank this week and who knows who is next on the list, there is a feeling of uncertainty. Buyers are afraid to remove loan contingency because their lender might change terms at the last moment or even go under, leaving the buyers with no loan, risking their deposit check of 3% of the sale price, which is a considerable amount of money in our area. Until about 1985 the contract enabled the buyer to have loan contingency up to the final approval of the loan or the funding day. It is still the case in other states like Texas and Louisiana but not in the bay area. Here, the seller gets mad and asks the buyer what rights he has to expect the seller to hold his property off the market while he waits for his loan to get approved without jeopardizing his deposit check. Maybe it’s time to change this condition and give the anxious buyer some peace of mind.

The Real estate market is more balanced these days. There are more negotiations and less bidding wars. Some extraordinary homes still sell with multiple bids but most homes are being sold after a few weeks on the market and tight negotiations. Sellers still insist on their prices and buyers are more cautious. Many buyers wait to see what will happen with the banking industry, but others still buy homes especially in the preferred areas with the good schools.

It feels somewhat against intuition. Is it real?!?

Hi, yes this was an article in the Mercury News. Many homes in the Stockton area, the Sacramento area, and San Jose area are being sold as Foreclosures and REO (Real Estate Owned by the bank that was not sold to the public in foreclosure). They are priced low; therefore many investors and opportunists are jumping on these properties with anticipation for appreciation. There is still abundance of wealth in California. My friend represented a buyer in San Jose last week for an REO sale and there were 20 bids on that property. The banks do not want to get stuck with so many homes, they are listing them cheap and selling them to the highest bidder. The article was talking about a rise in the volume of sales; however the prices are lower, if you compare them to last year. It’s good that there is activity. BTW REO is not easy to buy; you need an experienced agent for that. There are strict rules and regulations and penalties if the buyer does not close on time. The Banks are getting softer again; you can see loan products that you have not seen for the last 2 years with 3% & 5% down payment and even ‘stated income’ (meaning you state that your income is a certain amount and you do not have to prove it). Still for the best loan and terms you need to supply paystubs, bank statements, good credit history, and verification of employment, proof of insurance on the property and proof of sufficient funds to pay your mortgage.

If you read my personal reports you would see that the prices in the desired areas, namely, Los Altos, Palo Alto, Mountain View, Sunnyvale and Cupertino with the good schools didn’t go down. Some homes are priced too high and have to adjust their expectations but if they are priced right they’ll still get sold with a few offers and great terms.

I listed on Wednesday a small house in Sunnyvale, Cupertino school district, with Stocklmeir elementary. We already had 50 agents and many interested buyers check the house. We are planning to hold it open this weekend on Saturday and Sunday and take offers on Tuesday.

You are invited to see it. It’s very clean and upgraded 3 bedrooms 2.5 bathrooms, situated closed to Sunnyvale Community center on 1225 Manet Drive.

Finally, a glimmer of good news for Silicon Valley home sellers: Home sales were up 30 percent last month compared with March.

Good news for Silicon Valley home sellers: Home sales were up 30 percent last month compared with March.

That was the steepest March-to-April increase in almost two decades for the county.

A total of 1,440 homes changed hands in Santa Clara County in April, up from 1,105 in March.

Investors appear to be returning to the market, as non-owner occupied buying is increasing.

to see the whole article, Please click here: Sue McAllister at smcallister@mercurynews.com

Sunnyvale CA is one of the largest Cities in the Silicon Valley, next to San Jose, Cupertino, Santa Clara, Mountain View and Los Altos. About 140,000 people enjoy the stability, the clean air, clean environment, abundance of parks and recreation facilities, beautiful community center and senior citizen center, great schools and fantastic Police & Fire department who shows up in less than 5 minutes when called.

The elementary schools in Sunnyvale attend 3 school districts according to geographic boundaries. Sunnyvale has 4 elementary schools that belong to the Cupertino School District

You can click on the link and view the location. Montclaire, West valley, Stocklmeir and Nimitz

Cupertino Union School District elementary Attendance Boundaries

The kids from the Northern neighborhoods, North of Fremont Ave attend Sunnyvale School District

Some of the schools are as good almost as prestigious as Cupertino schools. Cherry Chase Elementary

and Cumberland Elementary

are very desirable. Columbia middle school is known for the high math achievers. A high percentage of kids who attend Columbia middle finish Algebra before they get to high school. The school received grant from Juniper, a high tech company nearby.

The kids on the East side neighborhoods of Sunnyvale, East of Wolfe Road attend Santa Clara School District in Sunnyvale. Laurelwood Elementary is one of the best elementary schools in that area. The day care before and after school hours enables working parents to leave their kids at school after hours or early in the morning , knowing that they are in good hands.

In a meeting with Larry Stone the Santa Clara County assessor he explained that home prices are determined by the designated school for that property. There could be a considerable price difference between homes in the same street or adjacent street, just because they belong to a different school. The Real estate market is affected directly by the schools. While most of the country is affected by the mortgage market and prices are going down, Sunnyvale is holding tight. The prices are solid. Until now you can still see multiple offers and high home prices.