Coastal Real Estate and Lifestyles

Local agents were brought up to speed on the California Land Title Association(CLTA) owner’s coverage and how beneficial it can be, particularly for Coastside homeowners.  Invited speaker, Old Republic’s Chief Title Officer, Steve Johnson, is a 30 year veteran of San Mateo County title issues.

With so many details to pay attention to at the closing, buyers may not notice that one of the items they are paying for at settlement is a one-time fee for Owner’s Title Insurance.  This coverage protects the owner’s title to the property.  You might think, why do I need it if I can see the public record?  Because not everything related to the title of a particular property may be recorded.

Back in 1998, apparently with very little fanfare, homeowner’s title insurance coverage was expanded to include previously excluded issues, including unrecorded encumbrances.  A few examples:

• Someone else has an easement on the land.

• Someone else claims to have rights affecting your title arising out of fraud, duress, incompetence or incapacity.

• You are forced to remove or remedy your existing structures - possibly not boundary walls or fences - because any portion was built without obtaining a building permit from the proper government office.

• You are forced to remove or remedy your existing structures or any part of them, because they violate an existing zoning law or zoning regulation.

• You cannot use the land because use as a single-family residence violates existing zoning law or zoning regulation.

• Your title is unmarketable…allowing someone to refuse to perform a contract to purchase, lease it, or make a mortgage loan on it.

• The map attached to the policy does not show the correct location of the land according to the public records.

The list goes on… These items are from a sheet provided by Old Republic Title called “29 Covered Risks for Homeowners”.

When you buy or sell property in our area, the Listing Agent typically opens a “pre-sale escrow” which includes ordering the Preliminary Title Report.  That Report is included in the Seller Disclosure Package.  The prospective buyer can then review what this Title Report shows, we call it the “Prelim”.  This report includes items that have been recorded with the County Recorder’s Office.  Your Realtor will review this report and order items in the report that may be prudent to review further, called “Exceptions”.

Fortunately the claim rate in San Mateo County is below the national claim rate average of approximately 4%.  While this type of coverage is good for all homeowners, Coastsiders who own property in areas such as Montara, south of Half Moon Bay, Sunshine Valley area, and other rural areas, will be glad for this blanket of coverage.  Country properties can have fuzzier histories than clean-cut subdivisions.

To find out who your carrier is and what is covered and excluded, review your Closing Documents or ask your Realtor get you the name and contact information of your Title Insurance carrier.  To check out different carriers and their prices, check out this cool online tool called CLTA TitleWizard.

By the way, Old Republic Half Moon Bay is moving to a smaller location at 785-H Main Street, Half Moon Bay, to be staffed part-time/as-needed.  Phone number 650-726-9095 will remain the same as will the contact information of your escrow officer.  Call them for further information on this change.  Thanks to Angela Burnett for arranging for Steve’s visit.

This can get touchy…but it is important when you’re marketing your home to get top dollar, so smart sellers ask and smart Realtors are straight forward.  We all know that our noses get accustomed to familiar smells to the point of not noticing them anymore.  However, buyers use ALL their senses when shopping for a home and while visual is the first sense used upon driving up to the house (aka curb appeal) smell is the first one that kicks into gear upon entering the front door.

I chuckled as I was watching the movie Juno last night when the starlet of the movie reminds her friend that he can’t take another girl to the prom because “he hates that her house smells like soup all the time”.  Soup may be offensive to some teens I guess, as are many things.  Here’s the short list of smells that you better NOT have if you’re trying to sell your house.  And these days the average days-on-market is about 100 days.

1. animal- just about anything related to this category, with waste products from our adorable pets being the biggie.  With my buyer one day, we get to a house and the owner opens the door with their dog announcing our arrival.  I could see the discomfort on my client’s face.  I asked them to hold their dog then spoke with my client.  She confirmed her fear of dogs.  I had to ask the residents to remove the dog, not just hold him, if they wanted their house to be shown.  I held her arm through the entire showing because she was still shaky.  Concentration and focus gone.

2. smoke - any kind

3. food - mainly last night’s fish, or cooking with heavy spices.  Fresh baked cookies could be an exception, especially if there are 1 or 2 left over for you know who…

4. bathroom - I think you know what I mean here

5. musty/mildewy/moldy - likely candidate would be from an unchecked leak, although built-up dust and clutter can leave a residue.

Some remedies:

• For homes with pets as family members, I believe every situation is different, but definitely get rid of the fur as a first step.  I use a pet fur sponge regularly, not sure if it’s this brand but same idea.  I can’t just say put your dog in a kennel or put him outside.  Some can and some can’t.  What I do is incorporate “pet care” into the marketing plan for that particular seller.

• De-clutter.  Ask a trusted friend and your Realtor for opinions because if you’ve been living with it for any length of time you are too emotionally attached.

• Think before you get out the frying pan and spices.  Don’t start the process if you are having a showing or open house the next day.  Some types of cooking smells take days to clear out.  If you MUST cook, “try placing a small bowl of vinegar in the kitchen.  I use strong red wine vinegar”, according to Nancy Gaifyllia.  Or, “simply place a small, uncovered bowl of soda bicarbonate in a corner on the kitchen counter. It will absorb all the smells and leave your kitchen (and therefore the rest of your house) free of cooking smells”, says Petrina Verma Sarkar.  Ad menu planning to your marketing schedule.

• Give your house a detailing by hiring a professional cleaning service.  This is a very worthwhile cost-of-sale item.

• Consider getting room fragrance (from local grocer) or air freshener.  My staging contacts say that vanilla scent is best.  Nothing heavy, masking, this is not a replacement for the cleaning!  I tried the Clean Linen scent in my own house last night…this morning the men folk pleadingly came to me to request its removal…so I would agree this one is a bit strong, for our household anyway.

Buying is an emotional process; overlooking the role smell plays into our emotions is leaving a piece of your marketing out of the equation.

A few links to resources that make “scents” to include in this post:

Turn Paint into an Air Freshener - Joseph Ferrara, Sellsius

Recipes for eco-friendly cleaning

How to rid carpets of pet odors

Get rid of sour house smell

As you may already know, Harbor Village consists of the Oceano Hotel, the extended stay villas, a shopping area, a restaurant, and conference/special event facilities.  I met with Christian Diggs yesterday to get an update on the shops’ opening and other juicy tidbits since the last time I checked in.

The Oceano Hotel is now open - although you already know that if you’ve been reading my blog.  They’re already up to 30% capacity of the 95 suites with only a few weekends open under their belt.  The head chef is Bruce Mullins (locals will know him as the owner of 2 Fools Cafe when it was on Main).  Bruce manages the entire kitchen, catering, continental breakfasts, conference menus.

The restaurant will be separate and we still don’t know who will run it; it may offer a casual menu and feel on the first level and perhaps a more genteel dining experience on the upper level.

The Spa is still being built and will serve Hotel guests and day visitors as well.   I took a walk through the construction zone, it’s a pretty large space - plenty of room for all kinds of pampering.  Christian tells me that the spa consultants currently at work will incorporate the nautical theme into the design. 

There are five meeting rooms, the Oceano Ballroom for up to 350 (see photo with chandeliers), the Montara for up to 110, the Mirada for up to 70, and the Princeton Boardroom for up to 14.  The ballroom dance floor just went in.  If they can get Pride & Joy for one of the kickoff events, I’m there!

Since my mind is always going…yes, a problem at times, I couldn’t help but think of the great opportunities for local business building here.  A few ideas… If their marketing plan included introducing locals to what is available right under our noses, I can see win-win opportunities here.  Don’t we have Google, Yahoo, Siemens, and many corporate heads living the counterbalance to a high stress and fast paced business life right here? 

• Invite your out-of-town networking group to an overnight or a “business” day on the Coast with business sharing ideas combined with some local fun.  Realtors, think referrals.  Offer a client appreciation event to include a spa package or a local outing such as kayaking or a charter boat for whale watching (or Mavericks watching).

• Invite your employer to host a Holiday gathering or team-building event on the Coast.
• Host a company think tank to hash out issues, or brainstorm new ideas away from your every day setting.
• Host a 4th of July party in one of the rooms for private front row seats to our local fireworks show.

The shopping area tenants will get their keys in early April.  A grand opening is planned for some time in mid to late May.  What I know as of today is there will Toque Blanche, Savvy Skirts, a jewelry store, an oyster & wine bar, an ice cream shop, a hair & nail shop (separate from the spa), a novelty shop, a wine tasting room provided by a Sonoma County wine label, a deli, a juice bar, and a food shop (so far either sushi or panini-style sandwich shop).  Christian tells me that several business proposals are currently being reviewed for the final 4 spaces that remain.  I asked him what he’d like to see that is not currently in the proposal stack - he mentioned a kite/toy store, and a children’s clothing store.

I have to admit I’m looking forward to having wine tasting within walking distance!

Of course I was looking forward to hearing former Senator Jackie Speier and meeting new people.  She was the guest speaker for the Women’s Council of Realtors‘ (WCR) first monthly breakfast meeting of 2008 today.  The San Mateo Chapter meeting was held at The Left Bank restaurant in San Mateo.  It was nice to see a good turnout for this business networking event.  I had never attended an event with this group, although I know a few colleagues who are members.  When I learned that WCR was going to develop a blog network I was intrigued enough to look into the organization further, because I believe well done blogging creates opportunities and that interests me.

Jackie Speier is currently running for Congress in the 12th District and she has just co-authored a book, now published, titled: This is Not the Life I Ordered.  She shared how the book came to be, experiences from when she was Senator, and personal passions.  I came away with some thoughts to reflect on…  One topic I remember is when she spoke about “kitchen table friends” - you know, the group of friends you have that are always there for you no matter what time of day or night..or what phase of life you’re in…  She also referred to her “kitchen table support” which included her real estate agent, her lawyer, accountant…(the team I’ve mentioned that everyone should have around them for major life decisions).

So I did join and I look forward to meeting and networking with some fabulous women…and men.  Men are also welcome members.  I added WCR to the blogroll.

The multi-billion-dollar Economic Stimulous package, Bill HR 5140, that we’ve been hearing about was signed yesterday.  Home loans previously offered through Fannie Mae and Freddie Mac (conforming loans) and Federal Housing Administration (FHA) loans will have an increased secure limit for a short period of time.  The limit will increase to up to 125% of the median home price in a given county or metropolitan statistical area.  I don’t know yet if the limit will be based on annual, quarterly or monthly data, but here are Half Moon Bay’s median prices.  (Annual 2007 - $957K; Q4 2007 - $915K; Month Jan. 2008 - $1,250K.  The temporary limits are set to expire on December 31, 2008.

If you are a San Mateo County Coastal area Buyer or Seller:

Buyers:

• Start getting your financial house in order** and talk with a mortgage professional.  It’s your turn, but don’t expect any bargains in the Half Moon Bay area.

• After you talk with a mortgage professional you can look at properties with a new “eye” toward what you can afford under the new guidelines and loan limits.

• There is more available inventory now than a year ago (up 28% currently) so there are choices; however, some properties buck the trend and sell very quickly; some still never make it to the MLS.  It’s very neighborhood/location specific.  Pacifica has lots of great inventory to choose from right now if you’re considering neighborhoods there.

Sellers:

• If already in a listing contract, discuss these changes with your Realtor(r) and how they will affect your situation.

• If thinking of selling, contact 2-3 agents to discuss your needs and get brought up to date.

• We’re still in a Buyer’s Market and with lots of changes in the works; get yourself positioned to achieve your goals by staying aware of market shifts and taking your Realtor’s(r) advice.  These market shifts happen before they become headline news.

More detail about how this announcement may affect buyers and sellers in the San Francisco Bay Area in my Hot Topic.

**
Do you know your credit score?  700 is the new 680 per my mortgage contacts.
If you’re thinking about purchasing a large item with a credit card, it may be prudent to wait.
Have you looked at your credit report in the last 12 months to see if there are errors?

A little greeting…

Roses are Red
Our Ocean is Blue
Happy Valentine’s Day
From Me to You

They came from the Frenchman’s Creek neighborhood, Fremont, San Francisco, Sonoma, even southern California…tired of waiting for the bottom to hit, or starting the spring house-hunting…and many checking out our coastside communities on one of our “10″ days on my subjective weather meter.  Twenty-one groups came through my Open House in Frenchman’s Creek yesterday - the most in a long time!  They were upbeat, full of good questions, and ready to find their next, or first, home.  That number may not sound like a lot to my Palo Alto Coldwell Banker colleague, Arn Cenedella, who tells us about his 40-45 groups, but, hey, we’re excited!  And to the north, similar activity is being reported by Sonoma County country property expert, Coldwell Banker colleague, Pam Buda.

Are buyers noticing inventory shrink compared to last Fall?  Will we see a traditional spring spike in homes for sale now that we’re post-SuperBowl — even though we’ve still got 28% more inventory that a year ago at this time?  Consequently, we are still in a Buyer’s Market with an 8 month inventory absorption rate for HMB and a 10 month absorbption rate for the entire Coastside (Half Moon Bay, El Granada, Moss Beach, and Montara).  If you’re not working with a Realtor yet, now may be the time, as there are many “pocket listings” out there now…and some Coastside properties do not follow trends. 

Here’s a look at available inventory over the last year in Half Moon Bay alone:

Check out Transparent Real Estate if you’re not already familiar with it.  Author Pat Kitano was actually my very first contact into blogging…  The most ironic thing is that I had been subscribing to his site, that I just happened to stumble upon back in early 2007, for about 6 months before I met him at a Coldwell Banker sponsored event.  The room was packed and for two hours Pat and Domus Consulting partner Kevin Boer, also of 3OceansRealEstate, filled our heads with cool cutting edge info & tactics that agents may want to think about embracing is our rapidly evolving industry.  In other words, keep up or be left behind.  Our real estate clients and customers deserve a more transparent real estate industry; it seems to be on the way.

The challenge with real estate transparency is that our industry has historically been closed and confusing to those outside the industry.  There are reasons for confidentiality certainly and that will not change.  All clients want their interests protected and should expect such.  However, there are many aspects that can be communicated much more clearly and Pat’s site offers an enormous range of content, including industry news, real estate technology, thought leadership, marketing strategy, and more.  Here are a couple posts from his site that may be of interest…enjoy…

To Much Focus on the Armageddon Economy - 2/4/08

A Rash of Property Search Engines - 1/31/08

This charming neighborhood is centrally located on the Coast even though it is in the city of Half Moon Bay.  There is a small neighborhood park, quite an enjoyable stop for the younger set.  The level lots are set around several streets with the French theme… Ruisseau Francais, Bordeaux, Le Mans, Touraine, and others.

I’ve seen a few different floor plans - with open floor plans, some with three car garages, wet bars that were popular in the 80’s - some with beautiful remodels and upgrades.  Across the highway is a path that takes you either to Sweetwood Group Camp, a part of the Francis Beach Campground where reservations can be made for reunions, birthday parties, campouts, and other gatherings.  You can also get to the Coastal Trail easily.

There are currently three homes for sale presently ranging from $969K-$1.1 million.  There are usually 2-3 homes for sale per quarter, occasionally there are none.  Prices are holding steady as seen in the graph below from the MLS closed sales trends report for Frenchman’s Creek by quarter between Q1 2002 - Q4 2007:

Francis State Beach, Half Moon Bay, CA

I’ll be hosting an Open Home on Ruisseau Francais on Sunday, Feb. 10th…

I learned about Orange Oil today.  No, not for aromatherapy, the bundt cake recipe, or anything along those lines.  It is for termites.  The hottest marketing craze to hit the “structural pest” world has phones ringing off the hook, according to Kevin Palmer of Premier Termite in Half Moon Bay.  Why?  Because it’s not a poisonous gas, which many of us don’t care to put into our homes if we don’t have to.  Homeowners seem to be enthusiastic about this local-use option.  Orange oil is a contact spray with the active ingredient being d-limonene.  It has to hit the bug to work.  It does not spread termite to termite.  It will work in some circumstances and not others - only your professional structural pest inspector will know for sure… 

Kevin brought us up to date on the most commonly used products around here and the Coastside’s favorite pests - termites and wood beetles.  And he had some stories that made a few of us squimish.  The most common termites around here are drywood termites, dampwood termites, and subterranean termites.  I was going to share pictures but I really didn’t want to spend that much time looking up bugs!

One of the fumigation products being used now is called Vicane.  Per Kevin, this gas leaves no residue with proper application.  You do need to remove all food, including food in the refrigerator and freezer, and plants.  Kevin tells us that factory sealed cans can stay, but boxed or bagged items need to go out of the house.  However, some of us do not want to add more of this type of chemical into our home, even if it’s temporary - 3 days is the recommended time to stay out of teh house.  Once you return, that’s the time to wipe down and reorganize the pantry, which you’ve been meaning to do for years anyway.

Powderpost beetles are pretty common in our area also.  A product used to treat this pest is Timbor.  It attacks the larvae, yet they can still come back because there is a 3 to 5 year life cycle.  We also learned that older wood is less susceptible to bugs than the newer engineered wood.  Whether you have a newer or older home, it’s still a good idea to have an inspection every few years.  One house we heard about hadn’t had an inspection for many (10+) years and the inspectors found that under the hardwood flooring, there was barely any subfloor left because the termites had eaten most of the foundation.  The house basically had to be rebuilt. 

So your options are deconstruction/construction, fumigate, local treatments/orange oil or do battle in combination.  Your pest inspector will know based on the type of bug you have and the type of construction on your home.

For sellers, it’s wise essential (in this market) to get this inspection before your home goes on the market.  Know what you’re dealing with ahead of time to have the advantage going into the sale process.  For buyers, don’t discount a house just because it has a large amount of pest work (which can either be dryrot or bugs).  Just know what you’re getting into and use as a negotiating tool if it’s the house you want.  Of course, if it’s too much work, you can walk away.  Note that in this changing market, some sellers are coming to market with a pest clearance - as in markets past.  Susan O’Driscoll shared with us also today that most lenders are not requiring pest clearance but that could change.

Just so we’re all on the same page, Days on Market (DOM) refers to the number of days from Listing Date to Sale/Contract Date - not Close of Escrow date.  San Mateo County’s MLS also uses Continuous Days on Market (CDOM), referring to the continuous number of days a listing has been on the market.  The  days on market number can be misleading even though it is prominently reported in comparative market analyses and MLS reports.  Here are a few examples showing how it can be confusing:

Example A:  A seller hires a Listing Agent; finds after 30 days that he needs to switch agents.  New agent takes over and relists the property right away.  Even though the new agent may have a different marketing plan and strategy for that property, the MLS will show the property as already on the market over 30 days just as the new listing agent is hitting the ground running… (true story, I was that new agent.)

Example B:  A seller lists his home for $1.5 million.  After 30 days of no showings, he reduces the price to $1.3 million.  The agent knew the original list price was overpriced, but took the listing anyway…(that topic is for another blog)…Back to DOM….Now the home has been on the market for 2 weeks at $1.3 million and the seller gets an offer in this price range that he accepts.  For accurate comparable purposes, how long was this home really on the market - 45 days…or..2 weeks?

Example C:  A seller has his home listed and keeps it at the same price for 90 days with minimal activity.  He decides to take it off the market (technically let’s call it Withdrawn - which means it’s still listed but not active in the MLS) for 30 days, stage it, repaint a couple of rooms, and spruce up the landscaping.  The listing agent puts it back in the MLS at the same price; but during that time another house in the area comes up for sale for the same price but in a less desirable location within the neighborhood, and another house in the area sold but is still pending.  In other words, the market changed…  Will the days on market reflect what’s really going on in this market?

So how do we reconcile this vague number that so many people give credence to?  You Represent Your Client!  Period!  Watch the market, watch the days, watch the competitors, watch it all!  MLS systems were developed for the benefit of Realtors, not the general public - which must be why some public sites show the days on market and some don’t.  However, property history will be researched if a buyer is working with a Buyer’s Agent worth his/her weight in gold commissions.  And Listing Agents, with the permission of their seller clients, will do what what it takes under their fiduciary duty to get the property sold.  As our industry becomes more transparent…which I think is a very good thing, by the way…days on market will continue to ride that line between interesting statistic vs. bogus number.  Coldwell Banker colleagues and fellow bloggers Julie Joyce, CB Oakland/Piedmont office, and Arn Cenedella, CB Menlo Park El Camino office share their views on this subject here.

I guess this is not new as a worthy topic for industry folk to rant about, as I learned upon stumbling over an older post dated March 2007 by Russell Shaw on BloodhoundRealty.

One final note:  The Front Steps blog reports that ABC News Nightline may read comments posted there about resetting the days on market (back to zero) to make the listing appear as though it’s new.  Per the post there, the segment may air Monday or Tuesday.