Granny Flat Rent-Sharing

These guys are only operating in the Bay Area, but this is an idea that could spread, especially if they could buy the granny flats for less than $100,000.  They mention the company Node, who is charging $200,000 for a ready-built and installed 600sf ADU if you were to buy direct from them.

https://www.rentthebackyard.com/

If you are looking for a reasonably-priced granny flat, Amazon has dozens of kits for sale if you don’t mind assembling it yourself – the House-in-a-Box:

Link to Amazon Granny Flats

Inventory Watch

This is an interactive graph that compares the number of higher-end new listings per month.

We had a little uptick in July, but we settled back down in August. We only had five more listings last month than we did in August, 2018:

Here’s how it looks over ten years – we sure have more high-enders than we used to!


(more…)

NSDCC August Sales

You may remember that July’s numbers were all negative when I reported them on August 11th.

However, we had a slew of late-reporters, and July wasn’t as bad as I thought – the closings over $2,000,000 were only down 14% YoY (instead of -38%).

LINK HERE for corrected July report.

Last month was better – the number of sales over $2,000,000 were +13% year-over-year!

NSDCC Detached-Home Sales, August:

Year
# Closed Sales
Avg $$/sf
Median $$/sf
Median SP
# of $2M Sales
2017
279
$549/sf
$452/sf
$1,245,000
63
2018
276
$534/sf
$467/sf
$1,320,000
60
2019
261
$589/sf
$500/sf
$1,360,000
68
Latest YoY
-5%
+10%
+7%
+3%
+13%

Get Good Help!

Back to the Wall?

The way this is going, Realogy is going to get stripped down and sold for parts:

With his back against the mats, Realogy CEO Ryan Schneider considered selling the brokerage to its chief rival: Compass.

In a statement Friday, the SoftBank-backed brokerage said Schneider even proposed a plan where the arch enemies would form a joint venture — a proposal Compass said it declined.

The statement was made in conjunction with Compass’ motion to dismiss an explosive lawsuit filed by Realogy earlier this summer. In the suit, Realogy accused Compass of illegal business practices, including “predatory” poaching and attempts at collusion.

“The motion reveals the lawsuit for what it is: an act of desperation in response to Realogy’s rapidly eroding market share,” a Compass spokesperson said in a statement Friday.

In the statement, Compass said if Realogy’s suit is not dismissed, Compass intends to file counterclaims against the New Jersey-based conglomerate, the parent company of the Corcoran Group and Coldwell Banker.

Link to Full Article

ibuyer Example

The ibuyer’s quote will be a curiosity, but unless it is close to the homeowner’s expected value, then selling on the open market will seem like a better option for those who want max money.

Would a homeowner who has found another house to buy be an exception?  Rather than trying to convince a seller to take an offer that would be contingent upon them selling their current home, they could sell their house instead to an ibuyer in order to purchase the next home non-contingent.

I just had a case like this, so we tried it out.

The house that needed to be sold was in Los Angeles, and the homeowners were confident about its value being in the low-$900,000s – or at least $900,000.  Though it was an older home, it had been updated – and they felt that if it went on the open market that it would sell within two weeks.

The zestimate was $875,000, and when I ran the comps, most were under $900,000.

They pursued a reseller called Fast Offer, and I ran it through my source.

Their guy quoted $830,000, and because they would likely get beat up again once the reseller did a home inspection, they figured their net would be $820,000-ish…..which was insulting!

My automated source processed the address and asked three yes-or-no questions (with my answers):

  1. Have you seen the inside of the property? Yes
  2. Is it a fixer? No
  3. Would you consider a discounted, quick, no-hassle cash offer based on condition? Yes

Their response was immediate:

The home doesn’t qualify.

The ibuyers have to be looking for realistic homeowners with houses that can be flipped easily and for a decent profit.  They only have to ask the second question to gauge their chances – unless the homeowner admits that they own a fixer, it’s probable that they would hold out for a retail price…..or higher!

We did discuss that the $820,000 could have been close to the amount that an open-market sale would net. But in this case, the people gave up on buying the next house, rather than be ‘lowballed’ in their mind. Homeowners aren’t going to give it away!

The Compass Bridge Loan will be a better solution – and should be available this month!

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Wow – this has to be the lowest jumbo rates with no points ever!

First Day at the Office

I describe the strategy for sellers here, because buyers need to be on alert 12 months out of the year. Why? Because you only care about buying the right house at the right price – which isn’t affected by the general market conditions. You are looking for the one-off.

Carlsbad’s Low-Income Housing

The City of Carlsbad needs to build 2,094 very-low and low-income homes over the next ten years.  Hope they get busy on approving those granny flats!

CARLSBAD — Housing is arguably the most pressing issue in the state.

As such, every eight years the state determines the number of housing units, known as the Regional Housing Needs Assessment (RHNA), and distributes those totals to each county. From there, the county breaks down the total for each jurisdiction.

In San Diego County, the region was mandated to 171,685 new units for the 2021-29 cycle, according to the California Housing and Community Development Department (HCD). The San Diego Association of Governments presented the numbers during its July 26 board meeting.

For Carlsbad, it means 3,873 new units must be constructed by the deadline. The council also approved a letter to SANDAG in support of the new methodology during its Aug. 20 meeting.

“Those comments will be considered by the SANDAG board on Sept. 6,” said Debbie Fountain, Carlsbad director of community and economic development. “We did prepare the letter … and is recommending support for that methodology.”

The goal is to increase the housing supply, as California is suffering from a housing shortage. According to the state methodology, 65% of RHNA is distributed to each municipality’s relative to its share of transit stations and stops and 35% is based on the share of jobs.

Carlsbad has no major stops per the methodology, but is the region’s third largest employer at 4.76%. And since Carlsbad has a higher average income than most of the county, more affordable housing units are required.

However, the city’s RHNA allotment decreased by 1,126 units compared to the last cycle.

The proposed methodology requires the city to construct 1,310 very-low income housing, 784 low-income, 750 moderate and 1,029 above-moderate units.

The city’s very-low income housing increased by 398 units over the previous cycle, while moderate and above-moderate units decreased by 312 and 1,303, respectively. The county saw an increase of 9,695 units compared to the fifth cycle.

“We also wanted to get some acknowledgement of the great work Carlsbad has been doing for providing low-income housing,” Fountain added.

Councilwoman Cori Schumacher asked Fountain to provide clarification for the public between the fifth and sixth assessments. Fountain said if approved by SANDAG, the city would be responsible for more very low- and low-income units in the sixth cycle compared to the fifth.

Schumacher said the focus this time around is on jobs, while Fountain added the state set specific standards, such as housing being concentrated around job and transit centers.

“It’s a 65-35 split,” Fountain added. “They looked at the jobs-housing balance. They came down to this more data-driven formula.”

One change the city will face is addressing its density requirements under the Housing Element, Fountain said. As such, she said the city will struggle “a lot” with its Growth Management Plan due to the new housing requirements and methodology.

The city’s letter supports the methodology, but also states the city has made significant strides over the past 25 years due to its Inclusionary Housing Ordinance.

https://www.thecoastnews.com/carlsbads-rhna-allotment-decreases/

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