Blog Posts By Date: July 2017


​Biggest Mistakes Investors and Property Owners Make

There are two words that can cause huge headaches in the world of property ownership: deferred maintenance. Essentially, investors and property owners often do not spend a sufficient amount to make crucial repairs and renovations – which in the long run can become more troublesome than simply keeping up with maintenance over time. However, maintenance issues are far from the only misstep seen in this circumstance. Making a good living off real estate in any economic environment requires avoiding the classic mistakes that all too often see the light of day. Here they are, and though there won’t be a test at the end, you still get credit for taking notes. Lack of due diligence. Would you buy a car without test-driving several? How about a computer without researching specs? If the answer to these questions is a resounding no – as well it should be – then research is doubtless part of your purchase process. Right? Your specific type of research depends on whether you are a prospective homeowner, future landlord, land developer, or home flipper. However, what is universal is the need to ask plenty of questions about not only the home but the area in which it is set. Remember location, location, location. Going it alone. No property purchaser is an island. Even if you’ve closed a number of deals in the past, you may not be adequately prepared for the current market – something you need the help of experts to achieve. These include a sharp real estate agent, a competent handyman, a savvy attorney, an eagle-eyed home inspector, and a detail-oriented insurance rep. Getting the financing shaft. Exotic mortgages may largely have exited stage left with the blowup of the North American real estate bubble ten years ago, but we’re still seeing financing options designed to squeeze unqualified buyers into more home than they can legitimately afford. Keep in mind that opting for adjustable/variable loans or interest-only products may mean you’re going to hurt when interest rates inevitably rise. The goal? Knowing you have the financial resources to make payments should rates spike, or a Plan B to convert to a more conventional product if need be. Failing to adequately estimate expenses. The mortgage is just the beginning of what you should plan to pay when preparing to own a home. Keep in mind that you’ll be on the hook for property taxes and insurance, furnishing the home, installing elements such as new roofs and foundations, and keeping up with ongoing maintenance costs. Forget these items at your own peril – instead, make a list of monthly expenses and be sure they fit your budget before going house hunting. Paying too high a price. See again the idea of doing your due diligence before getting in too deep. It’s perfectly natural, particularly in a competitive market, to jump if it appears a seller may accept your bid, but that doesn’t excuse paying too much for too little. Don’t let your anxiety translate to an overly ambitious bid or you’ll be looking at years of debt as a result. Here’s the bottom line: research is key before investing in property. Give it short shrift and you’ll feel the pain down the line.   more...


Tax Deductions and Write-Offs you didn't know about.

One major upside to property ownership is the power of tax deductions and write-offs. Did you know, though, that there are deductions and write-offs that extend far beyond the traditional ones such as mortgages? Let’s explore. Renewable Energy Efficiency Property Credit Your bottom line may benefit from installing home equipment that harnesses renewable energy sources such as wind and sun. Provided you installed said equipment by the end of December 2016, you are eligible for this tax credit to the tune of as much as 30 percent of its cost, including installation. The Solar Energy Industries Association finds that about 700,000 American homeowners have installed solar equipment since 2010, making this credit ever more popular as time goes on. Residential Energy Credit Likewise, if you have worked to make your home more energy-efficient through installing new windows, asphalt or metal roofs, insulation, storm doors, heating systems, or air conditioning, you may be eligible for a tax credit up to $500. The credit has been extended through year-end 2016, and not taking advantage of it is tantamount to leaving money on the table. 1031 Exchange If you have exchanged property held for use in trade or business, or held for investment for a like-kind property also to be used for such purposes, you may qualify for tax deferment under Section 1031. Such an exchange may constitute something as simple as a property swap, delayed exchange, or simultaneous exchange – but beware as it can get more complicated from there. Property Tax Deduction You’re entitled to deduct real estate property taxes on Schedule A. You’ll find this amount on your annual escrow statement if you have a mortgage with an escrow account. In addition, if you bought a home this year, consult your HUD-1 settlement statement to confirm if you paid any property taxes when you closed on the home – these are deductible too. Charitable Contribution Deduction If you itemize, you will be able to deduct charitable contributions or money or property made to qualified organizations. You’ll typically be able to deduct as much as 50 percent of your adjusted gross income, but some cases limit that amount to 20 or 30 percent.   more...


10 Bulletproof Ways to Increase Your Home Value

What homeowner doesn’t want his or her property value to go up? Question is: what are the smartest ways to make this happen? In answer, we present 10 wide-ranging, comprehensive ways to bolster that value in the most efficient way possible. • Come hither, curb appeal. How does your home look to a prospective buyer? To get a fresh set of eyes on the situation, look critically from all angles. Keep the following in mind: accentuate the positive, eliminate the negative. Those aren’t just song lyrics. They’re good advice. • Emphasize energy efficiency. Get an energy professional to do an audit on your home, then follow his or her recommendations. They may include plugging leaks, shoring up insulation, sealing ducts, or installing a programmable thermostat to make climate control more efficient. • Pull out the paintbrush. You’d be amazed what a fresh coat of paint can do for the appeal of your home. You might also try refreshing your cabinets with a faux-wood finish – simple and effective. • Prioritize property care and maintenance. It’s simple logic: a house that is properly maintained will not only show better, but sell more quickly and with fewer hitches. The idea of properly caring for your property touches every aspect of the home, from the insulation in the attic to the grass in the front yard. A simple rule of thumb: if you think it needs to be fixed, it does. • Maintain rent at market levels. This is as key to maintenance as unplugging toilets or replacing kitchen fixtures. Your property value is largely determined by the amount of rent that is collected. Don’t cheat yourself. • Cleanliness counts. Your place may look good to you, but look again with a set of fresh eyes. Do you need to scrub the tub? Declutter the living room? If you need to bring a friend in for an objective perspective, do it. • Remodel in a reasonable manner. Make upgrades based on intent, not impulse. Ballpark costs should be around 20 to 25 cents on the dollar, with the rest going directly toward increased home value. • Smart small. Little steps can you take far if you persist. Try making two lists: upgrades you want to make for yourself and those that will add to your home’s value. Try doing a little bit of both through a methodical approach and you’ll be surprised at the results. • Go room by room. Take that methodical approach a step further and work one room at a time. This not only keeps your improvement projects manageable, but it will likely spare your sanity. • Kill ‘em with kitchen kindness. The kitchen is the number-one place where you’ll see return on your investment, so make it a priority. Some design suggestions: a mobile center island, stainless-steel appliances, and install a pot rack and wine-bottle holder. This presents a mix of the practical and the pretty – and the combination works. Don’t be daunted. Take it one step at a time and you’ll succeed!   more...


Wash Down Utility Cost with These Five Water-Saving Tips

With the East Bay Municipal Utility District board’s recent decision to raise water rates by 19 percent over the coming two years, there’s never been a better time to concentrate on minimizing your water consumption. Let’s look at a few methods to help you turn down the tap while at the same time continuing to maintain your property in top shape. Yes, it can be done. Water-pipe insulation. You likely have uninsulated pipes right now, which causes water to go through unheated areas and use more energy to heat up, but that’s an easy fix. By taking advantage of pre-slit foam pipe insulation, you’ll enjoy faster access to hot water while slashing waste during the heating-up process. Materials are available at most hardware stores, and it’s easy to snap the insulation over the pipe and then tape the ends closed over the split. Leak elimination. Did you know that a tiny drip from a worn-out faucet washer can result in wasting 20 gallons of water daily? Expand that out and you’ll find that larger leaks can waste hundreds of gallons each day. A simple yet thorough check of faucets and pipes for leaks can minimize or eliminate this amount of waste. Also, checking your water meter for hidden leaks can be very revealing. Planting drought-resistant yards. Whether you’re creating a lawn from scratch or overhauling an existing one, drought-resistant grasses such as Zoysia or common Bermuda grass are the way to go. If you replace herbaceous perennial borders with native flora, you’ll not only use even less water, but enjoy better protection against local plant diseases. Slopes will benefit from water-retaining plants that help slash runoff, while grouping plants according to watering needs simplifies matters. What’s more, you’ll add curb appeal to your property, which in turn increases value. Installing water-sensitive shower heads and faucets. Choose cost-effective low-flow shower heads or restrictors to reduce water consumption and limit your showers to the time it takes to scrub up and rinse off. Moreover, fit all household faucets with aerators, which are not only a major tool in the conservation arsenal but are also very affordable. Harnessing the trusty toilet. Here is the place where you can save an impressive amount of water if you follow a few simple guidelines. First, don’t dispose of waste by flushing it down – this wastes gallons upon gallons. Additionally, you can cut down on water waste by weighing down a pair of plastic bottles – an inch or two of sand or pebbles should do the job – and then filling the bottles with water, screwing on the lids, and placing them in your toilet tank away from any operating mechanisms. Simple, affordable, and effective. Remember: conservation isn’t simply about saving money. It’s about saving precious resources. We can and should all do our part.   more...


Are you Staged for Success?

When staging a home, how much of it really matters? According to a study from National Association of Realtors, 62% of sellers agents say that staging a home decreases a number of time homes spend on the market. Not only does staging decrease time on market, it can actually increase your property's value by as much as 10%. Staging a property allows potential buyers to get a feel for the home. Every visualization and opinion of a home begin with how the home is staged, and appealing to the largest number of potential buyers is crucial. The living room is the most important room in a stage. After all, this is usually the most commonly used room, followed by the kitchen and master bedroom. The yard and outdoor space are close behind while the guest bedroom is considered the least important room. Beyond staging, there are some common home improvement projects that benefit any property going on the market. For example, decluttering and cleaning the entire home is highly recommended. Other small projects include depersonalizing the home, removing pets, and making minor repairs.     more...


This Suburban Bay Area City has been heating up

If San Leandro, CA hasn't been on your radar lately, it's time to add it. Economic and Area Data - Retail and Commercial Vacancy rate has decreased from 3.8% in 2010 to 2.2% in 2015 - Rental rate has increased from $5 per square foot in 2010 to $8 in 2015. Since 2010, there has been a noticeable shift of more businesses moving to the area, resulting in less vacancies and higher rent all over. It's a good sign of growing value in San Leandro. Points of Interest - New San Leandro Tech Campus brings small tech boom in San Leandro - New Kaiser Permanente in San Leandro beings more employment in healthcare. - San Leandro Beer Craze with Drakes, Cleophus, and new 21st Amendment Brewery Since 2014, new businesses have been opening in San Leandro, creating more jobs and buzz about the city. Opportunities in Healthcare, Tech, and culinary scene are driving more interest into the city. This is adding on to many other points of interest, such as BART, Marina shopping outlets, and Costco among many others. Moreover, San Leandro offers some of the highest fiber internet to businesses, ramping it up to 100 Gigabytes per second. It's also known for its food operations for companies like Ghirardelli and Coca-Cola. What are your thoughts about San Leandro? 1600 MacArthur Blvd. Oakland, CA 94602 Tel - +510.250.7918 Fax - +800.507.6593
150 Post Street, Suite 600 San Francisco, CA Tel - +415.347.5658 Fax - +800.507.6593   more...


Are you a culprit of these food crimes?

Did you know America throws away an average of 40% of food? We’re throwing away too much. Most of us are throwing too much good stuff – recyclable and compostable items - into our garbage containers. Compostable items such as food and food-soiled paper are an especially big problem. Residential households and units can also save money if they pay variable rates for trash. By making small shifts in how you shop, prepare, and store food, you can toss less, eat well and save money. Here are five easy ways to help stop food waste. ​ Store apples up to seven days on the counter, then refrigerate. Keep apples away from bananas and avocados because they speed ripening. Keep tomatoes by storing them on the counter, vine side down. Transfer them to the refrigerator when fully ripe. To keep bread from drying out, store all types of bread in a breadbox, not the refrigerator. Old or hard bread can be saved for later by turning them into croutons. Shop smarter by buying only what you need until the next shopping trip. Buying fresh ingredients in smaller quantities also helps. Got leftover pasta? Give it a new life by turning it into a pasta frittata. Find more helpful tips and tricks at 1600 MacArthur Blvd. Oakland, CA 94602 Tel - +510.250.7918 Fax - +800.507.6593
150 Post Street, Suite 600 San Francisco, CA Tel - +415.347.5658 Fax - +800.507.6593   more...


Recent changes you should know about Fannie Mae

Michael Pang Recently, Fannie Mae made changes that could affect fixed-rate mortgages and student loan refinancing. As of June 29, the 30-year fixed-rate mortgage is down to 3.88% from 3.90% two weeks ago. A year ago at this time, the 30-year fixed-rate mortgage averaged 3.48%. Additionally, the 15-year fixed-rate mortgage averaged 3.17% and has maintained this rate the past two weeks. At this time last year, the 15-year fixed-rate mortgage was 2.78%. We can see the effects of the interest rate hikes from March, after the Federal Reserves raised its benchmarks. The higher rates are a signal of a stronger economy, which is also associated with a stronger real estate market. As the economy continues to grow, we can expect two more rate hikes by the end of 2017. And for the borrower with student loans, refinancing just got easier. Fannie Mae announced new policies that address challenges of homeownership due to significant increases in student debt over the past decade. The new solutions give homeowners the opportunity to pay down student debt with a mortgage refinance. The new policy also widens the borrower’s eligibility to qualify for a home loan by excluding debt-to-income ratio on non-mortgage debt. These include credit cards, auto loans, and student loans, paid by someone else. 1600 MacArthur Blvd. Oakland, CA 94602 Tel - +510.250.7918 Fax - +800.507.6593
150 Post Street, Suite 600 San Francisco, CA Tel - +415.347.5658 Fax - +800.507.6593   more...

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