Saturday, March 18, 2006

2/2006 Marin Real Estate Newsletter

Bay Area Real Estate Newsletter
February 2006

An Update on Liz’s Micro Preemie Daughter

Thank you all for your support and well-wishes after my news last month (difficult twin-pregnancy due to complication from amnio, 3 months complete bed-rest, delivery 3 months early, the death of my first-born daughter, Corinne, 3 hours after she was born; and my other daughter Kaitlyn’s long NICU stay. While Kaitlyn was in the NICU, she had heart surgery when she was 5 days old, eye surgery to correct blindness, 10 blood transfusions, and was on a ventilator for a month. Well, the good news is that Kaitlyn Elizabeth is finally home. After 127 days in the Neonatal Intensive Care Unit in San Francisco! (She was 1 pound 11 ounces at birth and is now 7 pounds 4 ounces). If you’d like to see pictures of Kaitlyn or read my story, please visit my personal website:

I am now back to work full-time and would be happy to help you with any of your Real-estate needs. If you are thinking of buying or selling a home this year, now is the time to get the process started.

Marin Home Sales Statistics

Amid news headlines that the National housing Market is in a bubble, According to the statistics below, the overall Marin real estate market heated up slightly from a “Strong Buyers” market to a “Balanced” market….HOWEVER this statistic is for the overall AVERAGE Marin real estate market. It is very important to look at the specific category of house that fits your home or home that you’d like to purchase. For example, homes priced under $1,000,000 are still considered to be a “Sellers Market”. Homes priced from $1M - $2M are in a “Balanced” market, whereas last month it was a “Buyers Market”; and it’s only the homes over $2M that are in the “Buyers” Market categories. So even though the overall average shows that Marin is in a “Balance” it is misleading due to the high-prices and shortage of “the perfect homes” in Marin.

Additionally, looking at different cities in Marin is also interesting: Mill Valley and San Anselmo are back in a “Strong Sellers Market”; Corte Madera, Fairfax, Larkspur and San Rafael are all still in a “Sellers Market”; Belvedere and Novato are in a “Balanced Market”; and Greenbrae and Belvedere are in a “Balanced Markets”, and lastly, Kentfield, Ross, Tiburon and the remainder of Marin are in a “Strong Buyers Market.”

Interest rates, although are now over 6% are still historically low. The holiday season is usually a very slow period for listing of homes. During this time last year (2/05) there were 460 homes on the market, as compared to 782 this February.

Marin Home Sales Statistics - by city as of 2/20/06
In order to view the monthly home stats, please click on this link:

There is No Bubble in the Real Estate Market
by: Corey S. Kupfer

That’s right – there is no bubble in the real estate market. Many recent articles and stories on whether there is a bubble in the real estate market show a lack of understanding of real estate, real estate investing and real estate markets. There is no one real estate market. Unlike the stock market, real estate is by definition geographically based and the markets are local. Also, there are various types of real estate that are differently affected by changes in the economy including interest rates. To make any blanket statement about the impact on the real estate market of interest rates or any other single economic factor is absurd. Finally, how any factor affects real estate investment decisions versus primary residence purchase decisions is very different.

The decision, for example, on whether to buy a primary residence in New Burn, North Carolina versus a pre-construction investment condominium in Miami or a multi-family residential building in Oklahoma City or a commercial office building in Manhattan or a strip mall in York, Pennsylvania is, always has been and always will be, affected by different market factors and right now by very different stages in the market cycle for those particular types of properties in those particular geographic locations. In my over 20 years of representing real estate investors, my clients have made money in markets that the media and so called experts have defined as overheated, in a bubble, depressed, stagnant and every other variation of good, bad or neutral.

Let us distinguish between purchasing a primary residence and an investment property. There are so many factors unrelated to value that should be more important to the decision to purchase a primary residence – such as do you and your family love the house, does it work for your lifestyle, is it conveniently located and are the schools good. Of course, value should also be a factor but high current values could be due to the market being overheated or due to fundamental factors supporting the increase in value. For example, in the mid ’90s there were some experts who were warning that the Las Vegas market was overheated, yet values continued to increase for another 10 years due to continued growth of the city and its surrounding areas. Also, if you are selling a house in the same market in which you are buying, the market value is less relevant as you either sell high and buy high or sell low and buy low. If you will be in the house for a long period of time, current market conditions are less important as well as it is hard to predict what conditions will be like in 10+ years.

Successfully investing in real estate over time is not easy. It takes work and discipline. We often have to review over 100 properties to find just a couple that meet our criteria. Many experts and the press will blame this on the real estate bubble bursting. In reality, however, it is just the market catching up to inexperienced or greedy real estate investors who did not apply the fundamentals while the experienced real estate investors moved on to investments in other segments of real estate or sat waiting to pick up the pieces of those appreciation gamblers on the cheap.

Mortgage Applications Drop

WASHINGTON, D.C. (February 8, 2006) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 3. The Market Composite Index — a measure of mortgage loan application volume was 619.3 – a decrease of 1.2 percent on a seasonally adjusted basis from 626.8 one week earlier. On an unadjusted basis, the Index increased 2.2 percent compared with the previous week, but was down 16.4 percent compared with the same week one year earlier.

FREE…..You can search for Marin listings directly on Search for Homes

Useful Remodeling Ideas – BEFORE You Get Started! by: Michael Johnson

Home remodeling can be done for function or just because the house needs a new look, or a combination of the two. The focus of home remodeling for most homeowners is usually the kitchen or the bathrooms because those are the rooms that add the most value to a home and can become outdated more quickly. Just as in fashion, home décor goes through fads, and typically if bathrooms and kitchens have not been remodeled for ten years or more, it’s obvious!

How many times have we heard the jokes about the ambitious do-it-yourself homeowner who starts project after project, only to stop in the middle and not finish any one of them? Usually the weekend warrior runs out of time, or perhaps money, or maybe he or she realizes that much more has been bitten off than can possibly be chewed. The results are evident – half-finished paintjobs that leave some walls in one color while others sport another; flooring has been exposed but never finished; kitchen cabinets are leaning against the wall yet will not be anchored in for weeks or perhaps months.

Sadly, many a homeowner neglected to receive some sound remodeling tips prior to embarking on their tasks. To this end, here are some tips and tricks that will you to get off to a good start, before you actually pick up your checkbook or your tools!

One of the first remodeling tips that are usually neglected is the fact that it should have a general appeal. Granted, this may be common sense, yet it is astounding how many homeowners add or take away from their homes in such a way that a future sale is compromised. While the homeowner may think that a purple bathroom with yellow handprints is just darling, the potential buyer who tours the house two years down the line will probably wrinkle his nose at this décor faux pas.

In the same way, if you decide to add on to your home, do it with an eye on the investment potential. In other words, do not do a half-fast job yourself, but instead pull the proper permits and hire licensed contractors to at least take a look before the building inspector stops by.

Experts have a tool box full of different small bathroom remodeling ideas, but most can be grouped into two categories: creating light and creating visual space. The illusions of space and light complement each other and expand a small space. Anyone who has tried to apply makeup in a small dark room knows how important light is, and it’s created in a variety of ways, both natural and artificial. Natural light comes from windows, skylights, and any other opening that allows sun into the space. Whenever possible, windows should be left uncovered or only lightly covered by a filmy white or light-colored window covering. Paint colors from the cool end of the color spectrum reflect and enhance natural light, as do mirrors and light-colored flooring. Even a light-colored, inexpensive rug used to cover a dark floor can brighten up a space. Artificial light, originating from ceiling lights, wall sconces or lamps, can also brighten a space when employed artfully. Recessed lighting, which creates the illusion of space as well as light, could also be a viable option for you. Just be sure to use artificial light that is bright without being oppressive. Look in your home and garden store for special bulbs that can be used to effectively diffuse the light.

Other remodeling tips include the popularity versus functionality of a desired item, as well as value for the items. For example, just because recessed lighting is the latest fad, it may not be the lighting of choice for the bathroom where it may create dark spots and shade in undesirable areas. In addition to the foregoing, the value of the items purchased should remain intact, thus adding value to the home rather than simply costing money.

Thereafter it is a smart idea to do a bit of research to see where home decorating trends are headed. Some old time favorites, such as ceiling tiles or even marble counter tops, are becoming a thing of the past, and if you are wondering about adding value to your home it is best to decorate with the market in mind. Naturally, not all homeowners will look to sell their properties within the next few years or until after the next remodel, yet this rule of thumb is certain to add value to the biggest investment you will ever make rather than just drain the bank account.

Hopefully these remodeling tips have added a little bit of common sense to the mix of weekend projects and large undertakings, and the next time you contemplate a project, please be sure to think it through from beginning to end before your jump into the car to head to the local big box store for supplies!

FREE…..You can search for Marin listings directly on Search for Homes

Walk in the Home Shopper’s Shoes!

Imagine walking into a ritzy department store to purchase expensive clothing or jewelry. Now imagine your surprise when you find the store lighted with a few dim 40-watt bulbs hanging from the ceiling. Unable to tell navy blue from black, or diamonds from zircon, wouldn’t you feel that the store was playing in the wrong league?

What if, across the street, another store offered merchandise that really dazzled your senses? Brilliant diamonds in crystal clear showcases, striking mannequins adorned with the latest fashions. Which store would get your business?

Now imagine you’re selling your home. Will buyers see a freshly painted exterior and neatly trimmed yard? Inside, will the aroma of fresh baked bread or cinnamon rolls bombard their senses? Will sparkling windows flood your home with sunshine?

Just as department stores merchandise their wares to appeal to your senses, you must do the same with your home to attract serious buyers who comparison-shop. To be chosen, a home must reflect pride-of-ownership and the greatest possible value for the price.

Capitalize on the condition of your home by asking your real estate agent to "walk-through," giving you ideas to improve its curb appeal. Now make all needed or cosmetic improvements before the home is shown. You’ll find that a house offered for sale in model home condition can actually create competition among buyers for its purchase!

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Home Sales in 2006 to be Slower but Sustainable

WASHINGTON (February 7, 2006) – Home sales this year are expected to stay below the peak levels in 2005 but will remain historically strong, according to the National Association of Realtors®.
David Lereah, NAR’s chief economist, said the sales slowdown has already occurred. “Right now, home sales are a little lower than projected, but they can be sustained around current levels,” Lereah said. “Sometimes people lose sight of the fact that real estate is cyclical. Even so, sales will continue at a historically high pace with modestly higher interest rates as the year progresses, and 2006 is forecast to be the third strongest year on record.”
Existing-home sales are likely to decline 4.7 percent to 6.74 million this year, down from a record 7.07 million units in 2005, while new-home sales are expected to fall 8.5 percent to 1.17 million from a record 1.28 million in 2005; both sectors would see their third best year after the totals for 2005 and 2004. Housing starts are seen at 1.87 million units in 2006, down 9.3 percent from 2.06 million last year.

The 30-year fixed-rate mortgage should rise to 6.9 percent by the end of the year.
NAR President Thomas M. Stevens from Vienna, Va., said home sellers are making some adjustments. “It’s easy to understand that sellers have taken it for granted that it would be fairly easy to sell without much compromise during the recent sales boom,” said Stevens, senior vice president of NRT Inc. “Now that buyers have more choices, it’s even more important for sellers to seek advice from real estate professionals. Pros can recommend the right mix of improvements to maximize return, as well as bridge the differences between buyers and sellers that often arise in the negotiation process. Consumers should keep in mind that not all real estate agents are Realtors®, who subscribe to a strict Code of Ethics.”
The national median existing-home price for all housing types is expected to increase 5.0 percent this year to $219,200. At the same time, the median new-home price is projected to rise 5.7 percent to $250,900.
Inflation as measured by the Consumer Price Index is forecast at 3.1 percent in 2006. Inflation-adjusted disposable personal income is likely to grow 3.9 percent this year.
Growth in the U.S. gross domestic product is seen at 3.4 percent in 2006. The unemployment rate should average 4.8 percent this year. ###
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.2 million members involved in all aspects of the residential and commercial real estate industries.

Fast Facts

Calif. median home price - Dec. 05: $548,430 (Source: C.A.R.)
Calif. affordability index - Dec. 05: 14 percent (Source: C.A.R.)
Calif. highest median home price by C.A.R. region Dec. 05:Santa Barbara So. Coast $1,300,000 (Source: C.A.R.)
Calif. lowest median home price by C.A.R. region Dec. 05:High Desert $320,490 (Source: C.A.R.)

Mortgage rates - week ending 2/9/06: (Source: Freddie Mac)
· 30-yr. fixed: 6.28%; Fees/points: 0.5%
· 15-yr. fixed: 5.91%; Fees/points: 0.5%
· 1-yr. adjustable: 5.34%; Fees/points: 0.5%
FREE…..You can search for Marin listings directly on Search for Homes

If you are thinking of selling your home, I would be more than happy to give you a free home evaluation report. I also create property specific websites for all of my listings: visit: for an example

Be sure to check out all the other great content & features of my website:

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The Bay Area Real Estate Newsletter is provided to you by:

Liz McCarthy
Real Estate Broker, e-PRO certified
415-380-2114 (office)
415-250-4929 (cell)
60 Belvedere Drive
Mill Valley, CA 94941