Watch Out for This When It Comes to Flips

Home flipping is growing at a rate comparable to 2006, and some real estate pros are warning buyers to be cautious and do their homework before purchasing a property they plan to flip. Read more: Beware of the Flip “Some flippers are turning historic homes into modern, hybrid treasures, but others are slapping cosmetic fixes on truly troubled properties, ignoring mechanical and structural issues,” CNBC reports. “For more unsuspecting buyers, that move-in-ready dream home can quickly flip into a nightmare.” That was the case for one buyer, Cameron McGuire, who had purchased a three-bedroom, three-bathroom condo in Washington, D.C., that had been renovated by a local developer-flipper. Six months after moving in, McGuire received a call from a Washington, D.C., housing inspector who had been investigating claims against the developer by other buyers. The inspector “gave us list after list after list of things that were either not permitted or violations or weren't zoned correctly here in the property," McGuire told CNBC. "Receptacles are not permitted the way that they're installed here. The canned lighting up in the ceiling is not permitted the way that it is supposed to be in here. … It was an unending list of things.” Permits for a back addition, which included two bedrooms and two bathrooms, also had never been filed, which means that McGuire now must tear it down. "It's literally putting lipstick on a pig," Stephen Carpenter-Israel, president of Buyer's Edge, told CNBC about many home flips lately. "They're just doing cosmetic stuff and actually covering up problems, and that's scary because it's very difficult to figure it out.” CNBC provided some of the following tips for buyers purchasing a flip: Make sure the house flipper is a licensed contractor. Request a list of all the work done and ask of receipts and warranty information. Check for permits on the property. Ensure all upgrades made pass full inspection.

Tallying new apartment construction in Silicon Valley: Hope amid the housing crunch?

We’ve got jobs, jobs, jobs in the valley, but no place to put the workers when they clock out at night. Maybe there’s a ray of hope. A new report from the RENTCafé apartment-search website says that intense renter demand is driving a wave of new construction in booming urban markets, including the San Jose metropolitan area. RENTCafé compiled a list of the top 20 U.S. metros with the most apartments to be completed in 2016 — and San Jose cracked the list, barely. It sits in the No. 20 spot, but let’s call it progress: 5,866 new units are scheduled for completion this year in the metropolitan area, which includes Santa Clara and San Benito counties. Compiling data from new large-scale projects (buildings with 50+ units), the report breaks down Silicon Valley construction like this: 4,077 units in San Jose; 445 in Santa Clara; 378 in Milpitas; 378 in Mountain View; 378 in Sunnyvale; 128 in Morgan Hill; and a measly 82 in Palo Alto. For many, Palo Alto still signifies “Silicon Valley,” but the city can’t seem to get off its duff when it comes to making decisions about housing. Among the top 20 metros, Texas leads the pack with a combined 69,000 units projected for completion in Houston, Dallas-Fort Worth, Austin and San Antonio. Houston sits in the No. 1 position on the Top 20 list; it has 25,935 units slated to come online in 2016. The rest of the Top 5, in order, is Dallas (23,159), New York (21,177), Los Angeles (20,205) and Washington, D.C. (18,027). Here’s the full report. As you can see, San Francisco is No. 12 with 9,362 new units — more than doubling the 4,144 units completed in 2015. Whether all this construction will be enough to ease further Bay Area rent hikes remains to be seen. The region now has 746,100 technology jobs, according to an analysis by this newspaper published earlier this week. That tops the record set during the dot-com era by 21,000 jobs. Where will all these people live, and how will they do it affordably? Good question. A second-quarter report from Novato-based RealFacts showed rents continuing to climb across the region’s nine counties, though at a slower rate than the year before. The average Bay Area apartment rented for $2,526 in the second quarter, up 4.3 percent year over year. The average San Jose rent was $2,503, up 4.0 percent. In Oakland, the average was $2,959 up 5.4 percent, and even far-flung Concord saw a sharp increase of the average rent to $1,760, up 8.3 percent. Those numbers don’t capture the mom-and-pop landlord rentals that tend to be less costly. But they still are a good indicator of the region’s entrenched housing predicament — which drives thousands to commute long distances from more affordable communities to their jobs in the valley. And incidentally, if you’re thinking of finding some relief by moving to Sacramento, think again. Among the top 5 markets for projected rent growth this year, according to RENTCafé, “Sacramento will have the smallest number of new apartments added to its inventory in 2016, an unimpressive 730 units in large-scale developments. This actually represents a 30% decrease compared to 2015 when 1,000 units hit the market.”

Menlo Park: Mayor says denser downtown housing worth considering

MENLO PARK — As the urgency grows for Menlo Park to build more housing with an influx of thousands of new workers looming, Mayor Rich Cline says he is open to the idea of increasing downtown zoning density. “I could support an increase if there were tradeoffs that would mitigate against increased traffic volumes,” Cline told The Daily News on Tuesday. Downtown zoning rules established in 2012 allow up to 680 more housing units, with 18 of those approved and 462 proposed, accounting for 71 percent of the total. Meanwhile, Belle Haven activists are calling on the city to build affordable housing citywide, not just in their neighborhood. The city General Plan currently being updated would allow an additional 4,500 housing units in their neighborhood, including 15 percent below market rate. Adina Levin, who serves on the Transportation Commission and lives near downtown, said she supports the idea of increasing downtown density even if it means three-story buildings on Santa Cruz Avenue. “We’ve had people who say, we want to keep the buildings the same to preserve the character … but if we keep all of the buildings the same, we lose the character of the people,” Levin said Aug. 18 during a housing crisis forum at Kepler’s Books. Cline said he’s also open to the idea of rent control, but noted the General Plan update might not be the best place to address it. “In general, we need to review the entire catalog of options when it comes to helping our residents stay in their homes and thrive,” Cline said. “Options range from adding affordable housing to rehabilitating older structures to increase and improve housing … to rent control to … policies against evictions. Lots of options, but nothing will solve it alone.”‘ Levin agreed that the General Plan update shouldn’t be held up by talk of adding rent controls, but said it would be a good policy discussion for the City Council to have in the near future. Kepler’s held the housing forum — moderated by council candidates Ray Mueller, Cecilia Taylor and Catherine Carlton, as well as East Palo Alto activist Kyra Brown — to raise awareness about a growing problem that affects many of its employees. According to an analysis by the Housing Leadership Council of San Mateo County, the county added 70,800 jobs and 2,501 housing units between 2011 and 2014. Between 50 and 60 people attended the event, with roughly a dozen speakers blaming government officials for the problem. Kate Downing, who cited displacement in her recent decision to resign from the Palo Alto Planning and Transportation Commission, put the blame squarely on city councils. “The root of the problem … begins and ends with your local city councils,” Downing said. “I hear a lot of blame about Facebook and I hear a lot of blame about Google … but they don’t make these decisions alone. … Be wary of the politicians who say that affordable housing is the only solution. … We need to get rents down, not just for affordable units, not just for the subsidized units, but for all units.” At the event, Mueller said he hopes Menlo Park and East Palo Alto can “share revenue” to deal with the jobs/housing imbalance. Both cities are undergoing General Plan updates. Email Kevin Kelly at kkelly@bayareanewsgroup.com or call him at 650-391-1049.

Menlo Park: Boarding house proposed along Willow Road

MENLO PARK — A property owner hopes to build a boarding house along Willow Road in Menlo Park, according to city documents. While a city planner acknowledged that the project, if approved, would be a “single-room occupancy type of building,” he said it would not operate like a hotel, as all tenants would at least have monthly leases, and it would be geared toward high-income workers. “It’s our understanding that it would likely be longer-term leases,” Senior Planner Kyle Perata said, adding that he wasn’t aware of the city receiving any boarding house applications in the past. “It would be market-rate units, it would not be part of the (city’s) below-market-rate program.” ADVERTISING The project is planned for 555-557 Willow, where Menlo BBQ currently operates. The restaurant would continue at the site whether or not the project is approved. Property owner Reza Valiyee seeks to tear down a long-vacant office building and construct a three-story building with 16 bedrooms. Each bedroom would contain an individual bathroom, but all residents would share a common kitchen and living room. The project would trim the current 20 parking spaces at the site to 14, with four of them covered spaces. Perata didn’t have additional details, as the project is still undergoing an initial review. The proposal would need to go before the Planning Commission for approval, but has not yet been put on the city’s calendar. Perata encouraged people with questions or comments about the plan to call him at 650-330-6721 or email him at ktperata@menlopark.org. Maureen Holding, a nearby resident, wrote a letter to the city saying the project would be out of character with the surrounding neighborhoods. “Placing either a hotel or college-type dormitory in the midst of a family-oriented neighborhood is certainly not appropriate,” Holding wrote. In September 2014, Valiyee proposed to convert the existing office building into two residential units containing five bedrooms each, but it stalled after the Planning Commission raised concerns about adding another floor. Email Kevin Kelly at kkelly@bayareanewsgroup.com or call him at 650-391-1049.

Bay Area fireplace rebate applications to start Friday

SAN FRANCISCO — Starting Friday, Bay Area homeowners can apply to receive $750 to $12,000 in rebates to replace wood-burning fireplaces or stoves with cleaner gas or electric heating devices such as fireplace inserts. Preparing to give away big public subsidies to reduce smoke, the Bay Area Air Quality Management District set 10 a.m. Friday to begin taking applications for a total of $3 million in rebates. Pollution officials urge homeowners to sign up promptly because the rebates are available on a first-come, first served basis. The money is expected to cover rebates for only about 1,500 homeowners, and 40 percent of the funds will be set aside for low-income homeowners or residents of ZIP codes heavily impacted by winter smoke, or neighborhoods without access to natural gas pipelines to heat homes. “We expect the rebates to go fast,” said Tom Flannagan, an air district spokesman. “We’re doing the rebates now so that these installations will be done over the next few months and people in winter can enjoy the benefits of switching from their dirty old wood-burning devices to cleaner alternatives.” Rebates start at $750 to decommission and seal up a fireplace and $1,000 to replace a fireplace with a natural gas fireplace insert, which relies on gas logs to produce flames. Low-income homeowners are eligible for larger grants. The maximum rebate is $12,000. Flannagan said that to fill out the application, homeowners need to figure out generally what type of device they intend to install — such as a gas fireplace insert. Before the installation can begin, homeowners selected for grants must receive an air district notice that their project plan has been approved. The air district last year set aside the $3 million for the rebates in an effort to protect public health from wood smoke particles, which can lodge deep in the lungs and cause or aggravate asthma, strokes and other problems. Burning wood fires is generally banned in the Bay Area on Spare the Air days in winter unless a homeowner lives in an area where the only option for home heat is a wood-burning device. However, under a new district rule effective Nov. 1, homeowners wanting an exemption from the no-burn rule must register their stove or pellet stove with the district to verify it’s a low-emission model certified by the federal Environmental Protection Agency. Contact Denis Cuff at 925-943-8267. Follow him at Twitter.com/deniscuff or facebook.com/denis.cuff. HOW TO GET A REBATE Homeowners can submit applications for rebates to replace fireplaces with cleaner devices either online at www.baaqmd.gov/WoodSmokeGrant or by calling 415-749-5195. Visit the same website for information about rebates Rebates vary by device installed, and can be as much as or less than the cost of the new device installed. The base rebate is $750 to seal and close off an existing fireplace. The rebate is $1,000 for a new gas fireplace insert, and $3500 for an electric heat pump. To seek the rebates, homeowners must live within the air district, which covers seven Bay Area counties and southern portions of Napa and Solano counties.

Money’s Available to Buy But Many Renters Don’t Know It

Posted in Financing & Credit, Working with Clients, by Robert Freedman on March 16, 2017 Millions of households are mortgage-ready but don’t try to buy because they can’t come up with a downpayment. And yet, hundreds of downpayment assistance programs around the country are available and go largely untapped. To be sure, many households won’t qualify for downpayment assistance. They simply earn too much money. But more people than you might realize would qualify if they would only apply. Because in many markets, the allowable income level is pretty high, and we’re not just talking about high-cost markets like San Francisco, where the median home price is about $1 million. There are more than a thousand downpayment assistance programs around the country. Each one is unique, with its own eligibility requirements, home-price limits, and resale restrictions. But these programs also share many features. The disconnect between the millions of households who could buy if they only had downpayment money and the availability of so many programs to help them creates an opportunity for you as a real estate professional. No one is in a better position to connect households with assistance programs than you are. It’s because of this opportunity to expand your market that REALTOR® Magazine hosted a live webcast on April 20. The goal was to let you know how you can find out instantly what programs are available for households in your area. Program experts were Rob Chrane, CEO of Down Payment Resource in Atlanta, and Brenda Small, GRI, associate broker with Keller Williams Capital Properties in Washington, D.C. They walked real estate professionals through the programs available, what they have in common with one another, and how you and your customers can tap into resources in your market instantly. They debunked myths about the programs, too. And they answered questions in real time.

10 Tips for Spring Home Buyers BY ALYCIA LUCIO ON 4 MAY 2017 Follow these 10 tips to make the home-buying process a happy one. The arrival of spring means it’s time to start fresh. Along with pulling out your warm-weather wardrobe and tackling spring cleaning, you may have a bigger project on your to-do list: buying a new home. Before you start on your home-shopping journey, check out these 10 home buying tips to save you both time and money. Find the right agent Real estate expert Joe Manausa says the key to happy spring home buying is finding the most qualified agent to guide you through the process. With reviews available at your fingertips, finding a real estate agent you trust can be easy — provided you take the time to do some research. Check for agents with the best reviews, and give them a call. They’ll relieve some of the pressures of home buying, and walk you through all the necessary steps. Think location Sure, the three things that matter most in real estate are “location, location, and location.” Nonetheless, some buyers end up purchasing a home in a location that’s not right for them, simply because they make their choice for all the wrong reasons. “They’re looking at a house in the wrong area or the wrong school district, but they buy it because they like the kitchen,” Manausa says. Use the new open house The internet has completely changed the home-buying process, making it easier to choose which homes to go see in person. With 3-D tours available on the web, buyers can tour a home from their mobile device or a computer. Eighty-seven percent of home buyers use online resources during their home search, according to the Zillow Group Report on Consumer Housing Trends. Buy a home, not a project Buyers who purchase a fixer-upper can end up spending the same (if not more) than they would on a new home. “When buying a home, pay close attention to the ‘bones’ … and avoid getting caught up in the cosmetic features,” advises Dan Schaeffer, owner of Five Star Painting of Austin. If the kitchen cabinets are in good shape, but you want the space to be brighter, adding a fresh coat of paint is easier and less expensive than replacing all the cabinets. Ka-ching! Be a cash buyer Sellers are more likely to choose the buyer who already has money in hand over an offer that’s contingent on a mortgage loan. But if you can’t pay cash, getting pre-qualified for a loan can help the seller feel more confident that you’ll be able to secure financing. Avoid disaster — get a warranty The last thing you want after buying a home is for something to go wrong. You protect your car, so why not your home? Manausa recommends purchasing a home warranty: “[They’re] very affordable, and cover all the things that go wrong.” Your wallet will thank you. Make inspection time count Small problems eventually turn into big problems. The wood could rot, drains could leak, or the electrical panel may not be up to code. “Hire experts, and always get your home inspected,” adds Nathanael Toms, owner of Mr. Electric of Southwest Missouri. If the inspection reveals issues, be sure to deal with them effectively. For example, “it’s very important that a licensed electrician makes sure all circuits work properly,” say Dana Philpot, owner of Mr. Electric of Central Kentucky. Put safety first No matter the neighborhood or the home, your family’s safety should always be the number one priority after purchasing a home. “Even if the previous owner promised to return the copy of every key, it’s always a good idea to change the locks throughout the exterior of the home,” says J.B. Sassano, president of Mr. Handyman. “If the house has an alarm system, remember to change the code — and don’t forget the garage door.” Fix common repairs Repairs may come in the form of patching up small nail holes or weatherproofing electrical outlets. Whatever the need, Schaeffer recommends fixing the repairs before moving in your belongings. “An empty house is easier to maneuver and clean,” he says. For bigger jobs, find a professional to complete the repairs. Sites such as Neighborly can help you find home services providers. Add the finishing touches The best part about buying a new house is making it a home. Change the color of the walls, update the lighting, or add a more personal touch with a photo gallery wall. “It’s important to find the right gallery layout by measuring the wall space, which determines the size of photos you can use,” Sassano says. “Lightweight frames are the safest option, especially when hanging on drywall.”

Super Dads

2017 DOWNTOWN SAN CARLOS SUMMER WINE STROLL

2017 DOWNTOWN SAN CARLOS SUMMER WINE STROLL Sunday, June 11, 1-5 pm Enjoy a festive afternoon exploring boutique wines. 20 Merchants will open their shops as Pouring Stations, and they will also serve light bites to nibble. Start at the Event Check-in area on Cherry Street at Laurel, between Diddam's and Rangoon Ruby Restaurant. You will receive a glass, wristband, and program. All tastings are sample servings. Must be 21+ with Valid ID to participate. $35 per person through May 31 $40 per person June 1 to June 9 No reservations accepted on June 10 $45 per person day of event, June 11 RAIN OR SHINE - NO REFUNDS https://sancarloschamber.org/winestroll/