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http://www.sfgate.com/news/article/Vallejo-s-real-estate-market-in-middle-of-12285933.php

By Jordan Guinn

Published 5:15 pm, Tuesday, October 17, 2017

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As real estate prices continue to rise in the Bay Area, Vallejo is now in the middle of a renaissance as home buyers flock to the waterfront city in Solano County.

Nearly a decade removed from municipal bankruptcy, Vallejo boasts a thriving housing market, tech-savvy infrastructure and an improving school system.

As the property values surge in Oakland and San Francisco, potential buyers have expanded their search area when shopping for a home. This proves to be a boon for Vallejo, which has seen a multi-year rally in its real estate market as their prices remain a fraction of those in the rest of the Bay Area.

“There are substantial savings across the bridge,” said Linda Daraskavich, president of the Solano Association of Realtors and a broker for Coldwell Banker. “What you’re seeing here is consistent with other parts of the Bay Area, where you have multiple offers and homes selling for over the asking price.”

Location remains the most important factor in real estate, and Vallejo’s proximity to Oakland and San Francisco accounts for part of its appeal. However, new housing developments and the city’s new high-speed broadband network aims to make the city both a destination for buyers and a hub for the tech community.

“Fiber communications are critical to public services and commerce in the 21st century,” Vallejo Mayor Bob Sampayan said. “With downtown and Mare Island right on the waterfront and affordable commercial real estate, we are perfectly situated in the San Francisco Bay Area to become a destination for the new economy.”

The gigabit fiber is a public-private partnership that leases city-owned fiber to Inyo Networks, Inc. The network firm markets and provides retail services to a variety of agencies, including government, medical and educational institutions.

Vallejo has ranked No. 1 for nine consecutive months this year in Realtor.com’s “hotness” index. Realtor.com’s hotness index measures where houses sell the fastest and what markets have the most views on the website. Vallejo has sat toward the top of the list every month this year and outpaces other major players like San Jose-Sunnyvale-Santa Clara and San Francisco-Oakland-Hayward.

The median price of a single-family home in Solano County is $378,000, roughly half of the Bay Area’s median price, and the city boasts a stock of classical homes and recent construction. Victorians, bungalows, and tract houses are peppered throughout the city, while newer construction by Lennar, Shea and KB Homes feature Mediterranean and contemporary designs.

Famed architect Julia Morgan even built in Vallejo. In 2015, one of her designs hit the market and listed for less than a million dollars. The brown-shingle five-bedroom would command a price north of $4 million had it existed in San Francisco, listing agent Jason Born said.

Typically, a house spends one month on the market in Vallejo before selling. That’s slightly less time than the surging markets of San Francisco and San Jose.

Schools will always be a concern for families looking to buy a home, and Vallejo’s educational opportunities are on the upswing.

The city now features a mixture of private, public and charter schools. For the third straight year, U.S. News and World Report named Mare Island Technology Academy “One of America’s Best High Schools.” The publication’s award is based on academic achievement, graduation rate and percentage of students going to college.

Other coveted schools include Annie Pennycook Elementary, St. Patrick-St. Vincent High School and Vallejo Charter School.

Realtor Valerie Bechelli and her team recently sold 3024 Overlook Drive in Vallejo’s Hiddenbrooke Golf Course Community. The four-bedroom, three-bathroom sits on a quarter of an acre 10 minutes from the Vallejo Ferry. Built in 2002, the home offers hillside views, new windows, a modern kitchen with stainless steel appliances and hardwood flooring throughout.

The Hiddenbrooke Golf Course, designed by Arnold Palmer, winds behind the home that features gabled rooftops and a turret near the front door.

While the community is an enclave with one access road, residents of the Hiddenbrooke community represent a microcosm of Vallejo itself, Bechelli said. Young professionals, tech workers and retirees all call the community home.

“The demographics are kind of across the board,” she said. “We’ve had several people move from San Francisco to this area.”

Any time a city transforms in such a dramatic way there are concerns about lost identity. Vallejo celebrates its diversity and offers plenty of room for growth, so citizens aren’t in immediate risk of being forced out by rising home prices, said Joanna Altman, assistant to the city manager.

With so many local affordable housing options available, Vallejo is not seeing the type of exodus that comparable Bay Area cities are experiencing, she said.

“Bay Area wide housing and rent prices are on the rise, but Vallejo remains the affordable option,” she said. “Choose Vallejo.”

Article source: http://www.sfgate.com/news/article/Vallejo-s-real-estate-market-in-middle-of-12285933.php

The deadly wildfires that roared through Sonoma and Napa counties this week, destroying thousands of homes, might also scorch the Bay Area’s already brutal housing market for months or years to come, experts warned Friday.

An estimated 2,800 homes have been destroyed in the wind-whipped infernos in Santa Rosa alone, and a total of about 5,700 homes have been lost in Northern California — a catastrophe that potentially leaves several thousand people to determine whether to eventually resume living on their devastated properties or to move elsewhere.

As a result, an already strained housing market — whose grim signature is skyrocketing home prices — could soon become even tighter as displaced residents begin scouting for places to live until their homes can be rebuilt, or they decide to relocate.

“It’s already a tight housing market, one where home prices have risen a lot over the last few years,” said Frank Nothaft, chief economist with CoreLogic, which tracks the residential market. “And apartments are tough. Rents are up. Prices are up. Rental vacancies are well below the national rates.”

This adds up to a challenging hunt for a place to live, even temporarily, for those forced from their homes.

“We are losing about 4 percent to 5 percent of the housing stock in the (Santa Rosa) area,” said Oscar Wei, a senior economist with the California Association of Realtors. “This will cut into the supply, short term.”

Compared to the entire Bay Area, Santa Rosa’s roughly 2,800 lost homes is a small portion — 0.1 percent — of the housing in the entire nine-county region. According to the U.S. Census Bureau’s American FactFinder, the Bay Area had 2.8 million residential units in 2015, the most recent year available.

But it’s much more of an impact in Santa Rosa. The destruction of the roughly 2,800 homes represents 4 percent of the Sonoma County city’s 67,000 residential units.

“If you destroy 2,000, 3,000 homes, that just constrains the market even further,” Nothaft said. “Housing is already scarce.”

The combined loss for those residential structures is likely to be staggering. Realty experts say the median price of homes in Santa Rosa during August was $585,500. That could mean the combined value of the destroyed residences is roughly $1.63 billion.

Finding a place to live will be just one of the challenges for displaced homeowners, especially if they decide to return to their original residences.

“It could be six to 12 months, or even longer, to rebuild the house, depending how the insurance claims go,” Nothaft said. “Then, after that, they have to find the contractors and the construction workers. There’s a shortage of skilled construction labor right now.”

Experts say there’s no definitive answer as to whether home prices will fall, rise, or neither.

“Pricing can go down, possibly, because the area is burned out and not an attractive place to live, but what can push prices up is people are displaced and they need somewhere to live, so the demand goes up,” said Randall Bell, director of Landmark Research, which tracks economics issues.

In a foreshadowing of the fires’ vast impact, State Farm officials said that, as of Friday afternoon, they have received more than 2,100 homeowners insurance claims and more than 800 auto insurance claims related to the North Bay firestorms.

“It’s a mix, a wide range now,” said Chris Pilci, a State Farm spokesman. “It could be somebody who had damage from being on the fringes of the fire, or it could be a total loss. We anticipate the claim volume will continue to rise.”

Insurance agents have fanned out into the devastated region.

“The first few days, communication was very difficult in that area,” said Sevag Sarkissian, a State Farm spokesman. “It’s all hands on deck.”

The impact of the displaced residents could also ripple beyond the market for buying and selling houses.

“Apartment rents are definitely headed higher,” Nothaft said.

 

 

Article source: http://www.mercurynews.com/2017/10/13/infernos-could-worsen-bay-areas-already-brutal-housing-market/

Ethan de Seife and Laura Holtan moved to California’s Sonoma County from Vermont last year with their newborn son, two cats and a dog in tow, immediately running up against a harsh reality: the state’s housing market is expensive, and inventory-starved.

It took the couple a month of scouring online listings and vetting properties before they secured a four-bedroom house to rent for $2,800 a month in the Hidden Valley neighborhood of Santa Rosa.

Now, they have to start again — while picking up the pieces of a life reduced to rubble. De Seife and Holtan awoke in the middle of the night on Oct. 9 to the smell of smoke and were soon evacuated as fire roared toward the area, ultimately burning down their house. The family is bunking with friends south of San Francisco and weighing offers of assistance while trying to determine a more permanent living plan, which may ultimately mean leaving the state.

“There’s nothing off the table,” said De Seife, 44. “If we can’t get any of these things going, we might just go.”

The fires ravaging Northern California’s wine country have left thousands in a similar plight, and from a real estate perspective, the disaster is happening in one of the worst-possible places. The area has already been squeezed by a severe housing crunch and escalating values — with rents in Santa Rosa rising the most of any big U.S. metropolitan area in the past five years — leaving few options for people to live while homes are being rebuilt.

California faces a different set of housing challenges from other U.S. areas that are reeling from recent natural disasters. In Houston, where more than 100,000 homes were flooded by Hurricane Harvey, there was a glut of new rental apartments to house people. Texas and Florida, battered by Hurricane Irma, have active markets for new construction.

“Even though the number of households affected by wildfires is substantially less than households affected by Harvey, Irma, and Maria, those who are displaced are likely to have a much more difficult time relocating,” said Ralph McLaughlin, chief economist at real estate website Trulia.

Soaring Prices

Santa Rosa, the Sonoma County seat, has seen property values soar amid strict building regulations and demand from people seeking refuge from million-dollar home prices in San Francisco, about an hour’s drive to the south. Rents have jumped 50 percent in the past five years, the fastest growth of the top 233 U.S. metropolitan areas, according to Zillow. The median home price was $599,000 as of August, a 77 percent increase from the same month in 2012, Zillow data show.

There’s little available to lease, with the apartment occupancy rate in the Santa Rosa-Petaluma market at 96.5 percent in the third quarter, according to RealPage, which considers a 95 percent occupancy rate essentially full.

With the fires still blazing, it’s difficult to quantify the number of homes that may be affected. And for now, people are still grappling with loss and looking out for the safety of friends and neighbors. So far, more than 221,000 acres of land and 3,500 homes and other structures have been destroyed, according to the California Department of Forestry and Fire Protection. At least 31 people have died.

Related: Wildfires Trample California’s $58 Billion Wine Industry

It’s been years since the Bay Area housing market began its dramatic, post-recession appreciation in prices, and delinquency rates for home loans keep falling across the region.

The foreclosure nightmares of the Great Recession are now a vague memory. In the San Jose metropolitan area — defined as including all of Santa Clara and San Benito counties — only 1.4 percent of mortgages were delinquent by at least 30 days in July, compared with 1.7 percent a year earlier. The share of “seriously delinquent” mortgages — at least 90 days past due — fell from 0.7 percent in July 2016 to 0.5 percent in July 2017.

In the San Francisco metropolitan area, 1.8 percent of home loans were in the early stages of delinquency — at least 30 days overdue — in July, down from 2.1 percent one year earlier. More seriously delinquent loans, of 90 days or more, were down from 0.9 percent in July 2016 to 0.6 percent in July 2017. (The San Francisco metro area includes Oakland, as well as all of Alameda, Contra Costa, San Mateo and Marin counties.)

This is according to a new report by the CoreLogic real estate information service, which periodically gauges the mortgage market’s health by measuring early-stage delinquency rates.

Compare those latest numbers — dramatically low — to the rather shocking state of the market back in December 2008, when the region was in the middle of the recession: Half the homes sold throughout the Bay Area in that month were foreclosures. In Santa Clara County, foreclosures accounted for 41.2 percent of all homes sold in December 2008 — on the heels of the Sept. 29 stock market crash — compared with 8 percent in December 2007.

“The whole Bay Area is now well below the national figure for foreclosures,” said Frank Nothaft, CoreLogic’s chief economist, “and that is because the local economy is very good, unemployment is very low and incomes are rising — which means most families have the income coming in to enable them to stay current on their mortgage.”

Also, because prices are up in the region — the median sales price of a single-family home is above $1 million in several counties — homeowners “generally have a lot of equity wealth,” Martell said. And studies show that homeowners with lots of equity to lose tend not to lose it.

Nationally, according to the new CoreLogic report, the share of delinquencies overdue by 30-59 days fell from 2.3 percent in July 2016 to 2 percent in July 2017. The “seriously delinquent” rate fell from 2.5 percent to 1.9 percent during that same one-year period — and remains near the 10-year low of 1.7 percent.

Still, Frank Martell, president and CEO of CoreLogic, pointed to some “worrying trends” in other parts of the nation.

“For example,” he said, “markets affected by the decline in oil production or anemic job creation have seen an increase in defaults. We see this in markets such as Anchorage, Baton Rouge and Lafayette, Louisiana, where the serious delinquency rate rose over the last year.”

Article source: http://www.mercurynews.com/2017/10/10/bay-area-real-estate-home-loan-delinquencies-go-down-down-down/

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We all know the San Francisco rental market is tough.

In recent years, it has presented challengers for renters, but now it seems to be getting tougher for landlords. If the number of “move in specials” is anything to go by, filling vacant units this fall isn’t as easy as it usually is.

Though hardly scientific research, a filter of “special” on apartments for rent in San Francisco via Craigslist turned up over 450 possibilities. And it’s not only the neighborhoods filled with luxury towers offering these specials. Yes, SoMa has many of them, but as the gallery above proves, there are deals in the Sunset, the Haight, Pacific Heights–really, most any corner of the city, and in both new buildings and old.

Is the market softening?

For example, if the unit in question is rent controlled, “investors want to keep the rental rate as high as possible,” Way explained. To illustrate, say a $3,000 unit drops its price to $2,500. “Then it would take seven to 10 years to get back to the $3,000 if the rent control increase was on average 2 percent a year.” On the other hand, if the price stays at $3,000 with an incentive of a free month, the lost income is easily recouped.

So, S.F. tenants and prospective tenants, peruse the gallery above of apartments that seem to want you more than you want them. We hesitate to use the word “deal” with these rents, but “move in special” has its own kind of appeal.

Anna Marie Erwert writes from both the renter and new buyer perspective, having (finally) achieved both statuses. She focuses on national real estate trends, specializing in the San Francisco Bay Area and Pacific Northwest. Follow Anna on Twitter: @AnnaMarieErwert

Article source: http://blog.sfgate.com/ontheblock/2017/10/12/increasing-number-of-s-f-apartments-offering-move-in-specials/