Rent vs Buy?

Trulia recently published an updated report comparing costs to rent vs. buy in a number of real estate markets.

(Click on the map to embiggen).

I've highlighted the San Francisco market.  Click here to see the full Trulia article where you can play with some of the assumptions included in their calculations.  They also offer a full calculator where you can plug in numbers specific to your situation.

One of the main points of their article is to be sure to include the cost of monthly home owners association (HOA) dues.  We've noticed a significant increase in dues over the past few years and they can make a significant impact on your rent vs. buy situation.

Price differential between condos and TICs - update

We recently updated our quarterly report that looks at the differential between condos and TIC pricing.  TICs continue to have lower selling prices than comparably categorized condos.

The differential in sales prices is higher this year than the same period two years ago for two of the three categories (1br/1ba and 2br/1ba).  In the third category (2br/2ba), there were only two units sold in the first quarter of 2013 averaging more than $1.1million so the differential between 2br/2ba condos is distorted.

In a difficult and competitive market, TICs remain an attractively priced alternative.

The full report can be found on our website.

Little change -- low inventory

I've been away from the blog for a while but, as far as inventory is concerned, you haven't missed much.  We continue to have lower than normal inventory and lots of demand.  And even in San Francisco that's a formula for lots of competition and, ultimately, sales prices exceeding asking prices by an average 7-20%.

From our latest report here's a graph showing new listings (single family homes and condos) during each two week period.

We've been doing this report for almost two years so you can see that compared to last year inventory has followed the same cycle (as it does most years) with the lowest inventory between Thanksgiving and Christmas and then a steady climb into the spring market.  The difference is the number of new listings during each two week period this year is noticeably lower than it was last year.

The full report can be found at this link.

Luxury Collection Specialist

Just received my certification from Berkshire Hathaway HomeServices:

Another perspective on the lease vs. buy debate

Many professional real estate associations in California publish or subscribe to standard forms documents/libraries.  Real estate agents routinely use standard forms from the California Association of Realtors.  In San Francisco our realtor association has its own purchase agreement forms and related documents.

These libraries of forms are created usually by committees of lawyers and practitioners with day to day experience in the field as well as expertise in local and state laws which affect real estate transactions, ownership and tenancy.

The San Francisco Apartment Association recently released its updated standard lease form.  As it points out in a recent article, they started publishing this form 25 years ago as a 4-page documents.  It has now grown to 17 pages!  And that doesn't include several addenda that it recommends depending on circumstances -- ranging from topics such as bedbugs to parking to pets to tobacco smoke disclosure.

By comparison, the standard purchase agreement from the San Francisco Association of Realtors is 7 pages long.  The California Association of Realtors purchase agreement form is 10 pages.

In the perennial debate over whether it's better to buy or rent (San Francisco throws many additional complex considerations into the mix), the difference between the length of a purchase agreement and a rental agreement provides a perspective you should consider, whether you're contemplating purchasing a single family home/condo, a multi-unit property, or if you're about to sign a lease.