Coastal Real Estate and Lifestyles

I have an ocean view when I drive to the grocery store in Half Moon Bay. You may think - “so what?” Well, I agree… I certainly didn’t think it was important to me either. We all know the phenomenon of not appreciating what is right under our noses until it is no longer there. That’s my point - how do you put a price tag or a value on something like glancing at the waves or the mountains on a boring milk run? It’s a lifestyle that once you experience is hard to go back.

It wasn’t until I moved away from here and into real suburbia that I realized how unusual that was. At first the kids loved the idea of a movie theater five minutes away and a myriad of fast food stops within a one minute drive. Fortunately, we moved back and we were limited from being constantly drawn in by the ever-present consumerism.

If I want to stop at the beach on my way to an appointment, I can do that. If I find the time to catch up with a friend, we will sometimes take a short walk on the beach or a nearby trail. It’s amazing how refreshing this can be.

When the kids want to go to the beach it’s five minutes away. And we have taken short outings to the beach for years because it doesn’t have to be an all day affair when you live here. Grab a hat, blanket, book (or iPod these days) and you’re good to go.

What about going to an elementary school where one side of the playground is direct ocean views, another side is beautiful mountains, and the third view (across the street) is alpacas, yes alpacas? No wonder many local kids grow up happy, healthy and ready to take on the world - mine are right there along with the rest of their friends finding their way outside of the Half Moon Bay nest.

On the especially warm days when it would be 100+ degrees over the hill and 72-75 here, the well known beaches can sometimes be packed. It is always fun to know the back-road shortcuts thus avoiding Highway 1 heading into town. Especially when you need milk.

I don’t always have to go into Half Moon Bay to get milk. There are a couple of small markets close by within a mile for those emergency trips. The views for that short trip are spectacular as well.

When your brother shows up in red boots, you know it’s the Holidays…  We kicked off our family get-together at a festive Marin restaurant (no dry chicken for this party!) and then headed back to the “Family House” for more cheer and the annual Round Robin.  Doesn’t it seem that some people know how to shop for RR gifts and some clearly don’t… uhmmm, you know who you are. 

So you can guess the first topic to come up this time —”What is going to happen to the City of Half Moon Bay?” When a Half Moon Bay story makes the I.J. (Marin’s Independent Journal) news, it’s a big story.  And boy I sure wish I had an answer for them and everyone else who’s asking, but I don’t - yet.  (Another post on this issue to come after I hear back from the Mayor, hopefully.)  The voice of reason spoke from first hand experience…my mom.

Fast rewind to the mid 60’s:  Dad (rest his soul) was a prominent local politician, on the Fairfax City Council for years and on various committees and boards.  Our house was frequently grand central for mailer stuffing parties, phone campaigns (I hated the phone campaigns because I couldn’t talk to my friends for hours), strategy meetings, and of course, victory parties (I also hated having to get dressed up for those).  Those were the years when Barbara Boxer was also a politician in Marin and they were friends.  I remember she came over to our house and we went to hers.  The year Dad became Mayor, I was in the eighth grade, and I was painfully aware of the attention.  The town was so divided on growth issues that kids even took sides. 

As we’re sipping our Holiday mimosas, Mom shared stories of dad’s relationships with large landowners in town and how they worked together to meet the needs of both landowner and the town’s growth initiatives.  He sounded like a creative communicator who brought people together.  Then one year he supported a “measured growth” proposal from a property owner for use of his land and that was it, he was voted off the council in the next election.  He never returned to local government but moved his community commitments to the Native Sons.  Mom also recalled a lawsuit filed against the City by a property owner, and she remembers both parties settling on a solution and moving on.  Thankfully, we also moved on to lighter topics…and back to the house for some gift stealing.

The RR gifts that got stolen the most and “locked” in - electric scissors (cuts leather, cardboard, paper, etc. with a smooth motion - just slide the scissors through the items being cut - very cool); the movie “Hairspray” (you know, the one based on the musical); and the super duper Home & Hobby Labeler - for indoor and outdoor use.  The losers - glitter notecards, set of frames, stuffed Santa Claus heads (sorry MPS!).  I think we all know who can shop.  Until next year…

Remember any cool Round Robin/Secret Santa gifts you’ve received?

Frequently I am annoyed with myself for having waited so long to jump into real estate investing.  But, as many of you know, I like to research things before I make my move.  It is so much easier for me to know YOUR next step than MINE.  So I thought I’d share my journey and maybe some of you are in the same boat or can help get me get off the dime.

Tackling this topic in a post is like trying to fit Chris’ basketball in my purse…it just ain’t gonna happen.  (yes, I’m living & breathing basketball right now!)  So, I am going to share snippets of my experiences in these posts.  Once I’ve completed a bit more homework, I’ll create a Page on my site of Investing Resources for you.  For now, here’s a few consistent themes I’m hearing:

Invest for the Long Term.  This may sound obvious, but still people may think long term but act on short term.  Guess what happens…  I realize that the experienced flippers among us may feel differently but obviously I can’t speak for them.  The ROI figures are probably not going to “pencil” unless you go out of the area - and then there’s the management.  This has always been the message but some investors out there took a diversion from common sense in recent past.  Speculation is too risky for my blood!

Create your Team.  Lawyer - Accountant - Financial Planner - Realtor(r) - Lender.  The more this group can communicate with each other on your behalf the better.  I know several professionals in this arena but you each need to create your own team.  Locally, I know John Parsons for accounting/tax/financial planning.  If he handles his clients anything close to how he handles his team of young basketball athletes, they/we will be winners.

Develop a network of investment resources around the country.  I’ve got some good contacts for you - these guys are are doing it now…I’m planning on learning their strategies and formulas for success.  Can you afford the time or money to fly out of state every time you want to check out an area or property?  I certainly can’t.  My Investing Resources information will not be a random ”link” fest.  The links I provide here will be from sources whom I believe will add value for my readers.

Jeff Brown helps investors and also writes a blog called Bawld Guy Talking.  Thanks to my friends and mentors at Domus Consulting, I am going to meet Jeff and hear about his philosophy on February 2, 2008.  According to Domus’ Kevin, he’s helpful to most stages of investor.  “He seems to particularly like to take seasoned investors who’ve made questionable decisions and help them turn around.”  His main theme is “Purposeful Planning” for retirement income.  He’s flying into town and invited guests can hear him speak in Palo Alto.  Contact me if you have questions about this. (note:  I have Jeff’s “Know where you are” List, will post to a page soon.)

Sam Benson is a local Contra Costa County Realtor(r) and writes RealEstate 680.  I’ve gotten to know Sam through our Homescopes network.  Sam says there are opportunities in Contra Costa and West Solano counties.  Also, be careful with investor software… “They can be a little over the top and may make promises that the market does not deliver.”

Trevor Mauch seems like the kind of guy I’d like my daughter to meet.  (She’s too busy to read my blog so I think I’m safe here…)  Trevor doesn’t know me but we’ve become email penpals and he has given me some good tips.  His site, The REI Brain, is full of information and tells you where to start.  If he ever gets down to SF, I will let you know.

I’m just switching automatic email listing alert vendors to ad more search features and incorporate Google Maps.  Sitting here next to a warm fire in the fireplace, my Christmas tree lights twinkling, both adding more light to the room already aglow from my large computer screen, I’m testing, testing…and oops, an inaccuracy from a Google Map!

My husband chimes in, “I really like this house…”.  I check it out…I am familiar with it and share what I know.  I’ve met this very nice Agent, Genella, as we networked with each other while I worked on another listing in the same area last year.  As I’m talking about it and commenting on its location, he says, “No, it’s on the west side.”  Looking back to the screen to the Google Map and, sure enough, the pointer says it’s west of Highway 1.  The listing is actually on the east side of Highway 1.  This is not good.  I expect accuracy from the tools upon which my clients and visitors rely.

Picture this scenario:  You’re searching online - over 90% of us in the Bay Area do - and you think this house is worth a trip to Half Moon Bay, or to a nearby neighborhood, to visit.  If you’ve already decided that you want to be on the east side, you may quickly move to the next house on your screen because of location.  Because….Google Maps are always correct, aren’t they?

As data becomes more and more available, it’s natural to assume accuracy.  It isn’t always so.  You still need to do your homework - beyond the internet - and have a resource on the ground who does the same.  The inaccuracy may be from Google, but it also may be from any one of the technology providers involved that come together to make this product available to us for its intended purpose:  search real estate listings online.  Our role as real estate professionals does not allow us to assume as accurate everything that our tools deliver to us.

Knowledge is the new Data - or to follow up on the heels of “Thar’s Gold in them thar data” - “Platinum” is the new gold!

Here’s my Bling breakdown…

(1) Realtor.com now shows “Sold” data.  This from their site when I searched an address in my neighborhood… 

“Public records data or calculated estimates indicate that houses in your area are valued between $670,000 and $785,000 during the last 18 months.

To find the specific value of your home and a strategy to make it worth more you should contact and work with a real estate professional in your area.  Click Go to locate a Realtor (r) near you.”

(2) Mortgage Mania…

one from today on Foreclosure Fraud from CNN:  “Freddie Mac Warns Borrowers with Video…”

(3) The Brokers…The blogs are the place to get the most up-to-date info at this level…

Trulia seems to be a bigger player now and one to watch.  Of course, Coldwell Banker’s listings are featured on Trulia. (a posting from The Future of Real Estate Marketing)

(4) This source for all things Broker (and industry) related is one of the top in my Reader! (note: I have over 50 blogs that I peruse in my Reader and am adding/deleting regularly.)

(5) Local data used to provide local knowledge…

Local Market Trends for Q1-3 comparing 2006 to 2007

How mortgage changes affect us locally

Reil, now MLS Listings Pro, has recently allowed Sold Listings to show on an Agent’s site.  While there are many opinions on both sides of the table about Multiple Listing Service (MLS) management, this is a good thing for agents, clients, and online searchers using the data, either from the agent’s website or from MLSlistings.com.  As we continue to move forward into the “mega-information” age, holding back information isn’t going to benefit anyone.  We gave a proper burial to the MLS Book “ages” ago.  The real estate world is online and MLS systems need to get on board…or someone else will do it instead (hmmm, like Zillow?!).  We are quickly moving from 2.0 and now into 3.0 (don’t ask me to explain that one yet!). 

Even though a one-on-one meeting with a client will include Sold Listings, why shouldn’t consumers doing their own research - all 90+% percent of us - be privey to the same information without having to register or log-in.

A sold listing is not a commodity - yet it has been treated as such.  The board to which agents pay a fee for membership includes MLS privileges.  Displaying MLS data on an agent website for the benefit of their online visitors, including Sold listings, is part of the package.

1. Gas gift card
2. Bluetooth
3. An iPhone
4. A new MLS system that works with the iPhone
5. More open house signs
6. A traveling masseur (who also carries signs)
7. A self-cleaning car (well, they do it for stoves)
8. …with temperature controlled seats
9. A digital camera with video
10. A GPS - a Garmin?

OK, after my last research intensive post, I thought I would do something quick here - but nooooo, it was not so quick.  How hard can it be to come up with 10 wish list items??  I guess we don’t need much, right?  Number 6 is my favorite.  What’s on your list??

Is anybody buying…or selling?  Want to compare last year to this year with a sprinkling of “big picture” perspective?  Here you go…  This graph compares specific data, by quarter, between January 2006 and September 30, 2007 for Half Moon Bay, El Granada, Moss Beach, and Montara combined.  You will notice Q4-’06 absent.  The data includes:

• Number of new listings each quarter
• Number of closed sales each quarter
• Average Days on Market for each quarter
• Percentage of Sales Price to List Price for the closed sales in each quarter  (This does not show list prices changes.  Let me know if you would like to see another graph showing list price trends for one of my areas on my Market Stats page).

New Listingshave followed a familiar pattern, increasing in number during the spring months.  However, in comparing ‘06 & ‘07 pattern was a bit off in ‘07 - 7% drop in Q1 and 23% drop in Q2.  Will this continue through the correction on the Coastside?

Closed Sales over the last year had a little spike in Spring ‘06 and then began trending down slowly as we continue the correction.  You can see the impact on local sales the credit crisis, followed by negative consumer perception, brought to our housing market; however in Q3 2007 alone, there were still 41 closed transactions in these communities.  This recent article in USA Today points out the phenomenon of the effect of media reporting on consumer perception:

“…There’s a difference between the Wall Street perception of the economy and the Main Street perception,” Donnelly says. “Unemployment is reasonably good; consumer spending is reasonably good. There’s a difference between concern and reality….”

 Days on Market and New Listings almost mirror each other.  The overall increase from ‘06 to ‘07 is 49%.  The decrease in DOM since the beginning of 07 reflects an overall understanding by sellers that we are, in fact, in a buyer’s market and list prices began to reflect that understanding.  Inventory is larger now than the norm not because of an influx of sellers but due to the decrease in sales.  See also my article dated September 12, 2007 on what is a “normal” market.  To update, months of available inventory for September 2007 - 10.25; for October 2007 - 7.6; for November 2007 - (I will post when available).

% of List Price Receivedshows that when the price gets in line with the current market conditions, the property will sell.  If, for whatever reason, the seller is not able to bring the Listing Price to within the current market range, (taking into account other factors such as location, condition, presentation), those properties will become expired, withdrawn or cancelled.  As mentioned above, this does not show the listing prices, i.e. where the seller started and how many price reductions occurred to get to the sale price.

Bottom line:  Not everyone benefits in every market.  Work with the market, not against it.  There are winners in this market.
Need to sell:  Interview 2-3 local experts to gain perspective before hiring.  You will be spending a lot more time with your Listing Agent these days.  Trusting that your real estate professional is on top of trends and how to market your property in this changing environment, while getting the deal done ethically and professionally, is important.
Preparing to purchase real estate:  Work with a local expert who can drill down the specifics for your neighborhood of choice to get you the best deal on your new home.  Understanding your goals and timing is more important than ever.
No plans to buy or sell:  Enjoy my take on this, kick back and relax. 

Sources and further reading:

“…The housing market will turn around on a change in consumer perception…”by Pat Kitano, Transparent Real Estate

“…housing is in correction mode…but no need for panic.” by Dick Green, Briefing.com