So sales of homes in San Francisco are well, moving like hotcakes.  Multiple offers seem to be the new norm for any property that’s cute and priced right.

This week, Zephyr real estate reported 29 sales in the company (these are sales that just went into contract, but haven’t closed yet) and 13 of those had multiple offers and 14 went over the asking price.  There’s still old inventory being eaten up (I just got an accepted offer on a place that’s been on the market 100+ days) but the new, cute, well-priced listings are MOVING!

Out of the last 5 offers I’ve written for clients, 4 properties received multiple offers.

But what’s MORE interesting, at least in my opinion, is that we seem to be seeing a major resurgence of the all cash offer!

Yup.  In the last few weeks, the words “all cash offer” are a phrase I’m hearing on a daily basis.  Lenders are talking about it.  Escrow officers are talking about it.  And without a doubt, real estate agents are talking about it.  I recently put in an offer on a property with clients that had a cash offer.  We came in 12th out of 13 offers, and our offer was accepted.  And then just yesterday, I helped clients (they did have a loan) get another offer acepted.  12 offers were received by the listing agent and THREE of them were all cash.  In January, I had clients beat out on an 8 offer situation where the highest bidder was an all cash offer.

But what does this all MEAN?

Someone asked me the other day, “Why the hell would enyone ever tie up so much money in San Francisco real estate?”  Well, I’m going to go out on a limb here, but it might mean that the folks that are smart enough (or lucky enough) to amass a giant pile of cold hard cash seem to think that dumping all of their dough into real estate RIGHT NOW is a smart investment decision.

Prices don’t seem to be going any lower and with sales spiking upwards and prices creeping upwards, it might be safe to deduce that the bottom of the SF housing market has come and gone.

And here’s the thing, the theory that interest rates are low and THAT’S why it’s a good time to buy don’t apply to the cash buyer.  Interest rates don’t affect them.

I’d love to hear from some of you cash buyers, or even agents with cash buyers whether my theories are sorta correct or completely far fetched.  You can drop a note in the comments, or if you want to keep yourself anonymous, email me.

Today’s news from the mortgage world sucks, especially for San Francisco Real Estate.

From the SF Realtor’s Association:

Higher Fees, Lower Loan Limits = More Expensive Mortgages

Fannie Mae and Freddie Mac are raising the risk-based fees they charge on mortgages.

Beginning today, lenders will be required to pay the new fees on loans they sell to Freddie Mac, and starting on April 1 they will be required to pay the new fees on loans they sell to Fannie Mae.

Currently, the fees range from 0.25 to 3 percent of the loan amount. It is expected that the new fee will be one-quarter or one-half a percentage point higher.

In addition, the maximum loan that can be insured by Fannie Mae, Freddie Mac or FHA in high-cost areas will drop on October 1 from $729,750 to $625,500.

According to the California Association of REALTORS®, the likelihood of the maximum loan limit staying the same, given the composition of the House, is virtually nonexistent.

So, in coming months, expect more expensive mortgages.

So what does this mean to you if you’re looking to buy a home in San Francisco soon?  To put it nicely, get off of your butt and do it.

Now, if you’re not in the market for a piece of SF real estate, you can stop reading now.  This isn’t a sales pitch to convince you to buy when the time isn’t right for you.  If you’re not in the financial position to buy, or if you’re in an unstable situation where you might be moving out of the City in less than 5 years, or if you’re living in a rent controlled 5 bedroom apartment paying $500 a month rent, then stay put, do not pass go, do not get a mortgage.

But, if you’re looking for a home in SF – there’s a good chance that even if prices stay the same, loans will cost you a bit more in April, and quite a bit more if you wait until October since the rates for jumbo loans are higher and with many SF homes falling WELL above the point where a $625,500 loan limit will suffice unless you got a giant chunk of cash to put down, you’ll be paying way more for the same price.  (Unless you are looking for a home that allows you to get in under the $625,500 loan limit, then you won’t be affected nearly as much, though buying before April might not be a bad idea.)

So….. long story short, if you’re on the fence about buying an SF home, you need to decide which side of that fence you want to land on, and you need to decide FAST!

And sellers?  Yeah, you might want to list that home pretty quickly too while buyers can still afford to buy it.

And of course, if you need a San Francisco Realtor to help you climb that fence to see which side will be greener for you, or to help you list your property for sale, give me a shout – giving overly blunt advise in the most tactful way possible is my specialty.

If you’ve been working with a good and honest mortgage broker, you’re already getting the lowest rates possible.  A good mortgage broker knows that providing folks with lowest rates and best terms is the right way to do business, regardless of the amount of his paycheck.

A good broker knows that they are only as good as their reputations, and unless they’re honest and upfront with every client, they won’t get repeat business.  (Which is THE way to do business – ANY kind of business, whether you’re in real estate or you’re a dentist,

But not every mortgage broker works that way, especially when you consider that if a loan has higher interest rates and higher points – the mortgage broker makes more money!  Yikes!

The new rule will change things though – the way brokers will soon get paid will be a fixed commission that is no longer tied to loan terms.  Yay!

The new rule comes from the Federal Reserve and is called “Loan Originator Compensation amendment to Regulation Z” and the rule kicks in April 1st of this year (2011).

So if you’ve been dealing with a broker that’s been putting their paycheck in front of your needs, your loans, be it for a purchase or a refinance, will get cheaper.

Though if you haven’t been dealing with some honest, (shameless plug for my favorite mortgage broker alert!) like Tim Higbee from Guarantee Mortgage, then, well, you probably won’t notice much of a difference.  Honest brokers like Tim have been putting their clients’ needs first for years. 

Man, what a week!  I feel like I’m running on empty and am looking forward to getting a few hours to refuel this weekend!

I’ve been a little light on the San Francisco real estate postings, but between writing offers for clients and working on getting an FHA Short Sale listing pre-approved by the lender in the fabulous Diamond Heights Village (which, by the way, this large 1BR unit has some AMAZING views of San Francisco!  and a pool at the complex to boot!), prepping a magnificent single family home listing in the Inner Sunset (3BR’s, Edwardian details and a yard that forces you into a state of deep relaxation), fighting various wars against technology (the machines are winning…. grrrrrr!) AND overcoming the spring fever caused by last week’s February heat wave here in SF, I’ve just been too swamped/unfocused on blogging to put out a worthy real estate related post.

And today, well, today it not much different, except I do get to catch up with some clients and finally see their little boy!  AND celebrate another client’s birthday too, so at least I’ll get to play a little in between working a lot! 

But I DID want to quickly share with you a reminder that when I’m not writing about SF real estateand all the other awesomeness this City has to offer here on this blog, I’m reading about it and sharing the scoop on my Facebook Page (which also feeds to my Twitter Account if that’s more your style.)

A few examples of recent tidbits that I shared?

• Spend Your Valentine’s Weekend Falling in Love (with SF!)  at the Old San Francisco Mint
• Mortgage Rates Creep to 10 Month High, But Still Historically Low
• San Francisco Raccoons Get It On (Yes, you read that right, guess even they appreciate Valentine’s Day!)
• Leland Yee Opposes Increased Measures to Prevent Shark Torture
• How to Keep the Love Alive While House Hunting!

So don’t forget to “like” my Facebook Page or Follow me on Twitter to stay up to date on the various articles that relate to SF real estate, mortgage tidbits and general awesomeness (or in some cases, like Leland Yee’s tolerance for torturing sharks, crappiness) that goes on in San Francisco and beyond!

But that being said, you know I love me some SF real estate, so Monday you’ll be able to check back here and get a scoop on the latest market conditions.

In the meantime, TGIF and wishing you an AMAZING weekend! 

Per the folks over at Daily Real Estate News mortgage rates are heading upwards.  And while rates are STILL historically low, the increase in rates CAN affect your purchase power significantly.

How significantly, you ask?

Well, using some really round numbers, a couple with NO debt that makes $200,000 a year can afford a mortgage of about $780,000 at 4.5% interest.  At 5% interest, the loan about is $745,000.  And at 5.5%, the loan amount is $705,000.  ALL of these amounts will cost you $4,000 per month.

So, remember, rates ARE at historical lows, and if they do go up, they are still expected to stay historically low (let’s not forget, the 1980′s saw double digit interest rates!!!)

But if you pass up a property because you are looking for a bargain, you may find that you can’t afford that bargain if interest rates creep up, even by 1/2 a percentage point.

Good luck and happy hunting!  And if you need a great mortgage broker to provide you with advice on what you CAN afford, give Tim Higbee of Guarantee Mortgage a shout!  He’s professional, honest, available and even does FHA loans.

You read that right!  First time home buyers that get into contract before May 1st and close between May 1st and June 30th get a big fat tax credit! 

I could rehash the details, or I could give you the skippy straight from the horse’s mouth (and by horse, I mean the San Francisco Association of Realtors.)  You’re getting the latter:

$18,000 in Combined Home Buyer Tax Credits for a Limited Time

Californians have a brief window of opportunity to receive up to $18,000 in combined federal and State home buyer tax credits. To take advantage of both tax credits, a first-time home buyer must enter into a purchase contract for a principal residence before May 1, 2010, and close escrow between May 1, 2010 and June 30, 2010, inclusive. Buyers who are not first-time home buyers may use the same timeframes to receive up to $16,500 in combined tax credits if they are long-time residents of their existing homes as permitted under federal law, and they purchase properties that have never been previously occupied as provided under California law.

Under the federal law slated to soon expire, a first-time home buyer may receive up to $8,000 in tax credits, and a long-time resident may receive up to $6,500, for certain purchase contracts entered into by April 30, 2010 that close escrow by June 30, 2010. Additionally, under a newly enacted California law, a home buyer may receive up to $10,000 in tax credits as a first-time home buyer or buyer of a property that has never been occupied. The new California law applies to certain purchases that close escrow on or after May 1, 2010 (See Cal. Rev. & Tax Code section 17059.1(a)(4)). California law generally allows buyers of never-occupied properties to reserve their credits before closing escrow, but buyers seeking to combine the federal and state tax credits will not be able to satisfy the timing requirements for such reservations (see Cal. Rev. & Tax Code section 17059.1(c)(1)(A)). Other terms and restrictions apply to both tax credits.

For more information, CAR has prepared a Home Buyer Tax Credit Chart with a side-by-side summary of the federal and California laws. The State Association also has prepared a legal article entitled Home Buyer Tax Credit Update which might be of interest 

So, while I wouldn’t suggest running out and buying a home if you weren’t planning on doing it already, if you are already on the fence, $18,000 in dollar bills in one hand might be enough to tip you to the homebuying side. 

Tim Higbee, from Guarantee Mortgage gives us the latest mortgage rates for the week ending Friday, January 22, 2010.

Please note that rates vary greatly based on credit scores and loan to value.

To get YOUR rate quote, give Tim a holler, his contact info is below:

Tim Higbee
Sr. Mortgage Consultant
CA DRE LIC #01346292

415-648-1202 (direct)

Photo Credit: Robert Campbell Photography / Chamois Moon

San Francisco’s infamous Zephyr Real Estate (which happens to be the awesome company where I hang my Realtor hat) released it’s latest SF real estate newsletter.  And so, I’m sharing it with you!  (I’m pretty generous that way!)

Stay tuned for more articles from the best San Francisco brokerage’s newsletter over the next few days

For now, here the winter update for SF real estate:

As usual, the San Francisco real estate market is doing significantly better than the state numbers, or even the Bay Area region numbers would suggest. Sales have been noticeably improving since March and there is no reason to believe that a slow down over the holiday season is anything more than normal and expected.

The negative factors that do impact us include unemployment issues that are being experienced in the hi-tech industries that are located within commuting range of San Francisco. Consumer confidence numbers also appear to be weak.

There is some very good news to report, however. The number of San Francisco properties under contract is up 48% over what we were seeing at this time last year, and the number of closed properties is up 26% over this time last year!

Between buyer incentive programs, exceptional interest rates and great median home prices, there hasn’t been a better opportunity for buyers in recent memory. Since an improvement in consumer confidence only requires us to be optimistic, let’s expect a great Spring for 2010!

I predict that Fannie Mae, Freddie Mac and FHA loans will remain at $729,500 through 2010.

Ok, ok, so it’s not REALLY a prediction.  It’s an update from the California Association of Realtors.

Still good news.  The bad news – well, my psychic powers really don’t work.  Here’s the scoop from the association:

Good news to report: President Obama is expected to sign a resolution passed late yesterday by Congress extending the current limits for Fannie Mae, Freddie Mac, and FHA loans through 2010. The limits were set to expire at the end of this year. This is especially critical for California, where more than 80 percent of all loans are financed by Fannie Mae, Freddie Mac, or FHA, and will help maintain the positive signs we are now seeing in California’s mortgage market. President Obama is expected to sign the resolution today or tomorrow as part of a broader piece of budgetary legislation that will prevent a government shutdown.

While home prices in California have declined, the demand for housing has not. The market has been dominated by first-time home buyers who have faced a shortage of financing opportunities. The loan limits are set at 125 percent of local median home sales prices, up to a maximum of $729,750 in high-cost areas, including many regions in California. Sales in move-up and high-end markets have been constrained this year; the loan limits extension will help qualified home buyers in these markets to move forward with their purchases.

Although loan limits are safe through 2010, there is still work to be done. Congress has yet to act to extend the First Time Home Buyer Tax Credit past its current Nov. 30 expiration date. Yet the impact of the home buyer tax credit is clear: A C.A.R. survey of first-time home buyers shows that 40 percent would not have purchased a home without the tax credit.

In tandem with our efforts to extend the current loan limits, C.A.R. and NAR are vigorously working to have the soon-to-expire federal First Time Home Buyer Tax Credit extended, and we need your help.

I am asking every one of you to contact your congressional representative today. In the Senate, an amendment offered by Senators Dodd, Lieberman, and Isakson will both extend the program into 2010 and expand the eligibility requirements. The amendment has been attached to a bill that will extend unemployment insurance benefits. We expect the bill will pass the Senate and then be voted on by the House of Representatives.

Please call your Congressional Representative to urge them to support the Unemployment Extension bill that contains the home buyer tax credit. Please call (800) 961-3302 and enter your PIN number 166016229 when you are prompted to be connected to your legislator’s office.

Thank you for your help with this effort. Together, we can make a difference in Washington, D.C.

Sincerely,

James Liptak
2009 President
CALIFORNIA ASSOCIATION OF REALTORS®

***CORRECTION***

Loan limits will remain at $729,750!  NOT $729,500 as I previously mentioned.  Sorry for the typo!!!

See, my crystal ball IS wrong! Anyone know a good repairman???