Tina To's Real Estate Blog

San Francisco is a multi-cultural city full of immigrants from all over the world.  Like many other Chinatown all over the world, the Chinatown at San Francisco is within a few minutes walk from downtown San Francisco where major headquarters and offices located.  This town is a major first stop from Chinese new immigrants to land.  Here they can speak Chinese, buy foods imported from all provinces of China and find a reasonable price logging.  It also has good public transport linked to different parts of City for their work.  No wonder the house price in San Francisco is comparatively speaking stable. Every year the 15th of August in Lunar Calendar is Mid-Autumn Festival.  This year it falls on today, September 12, 2011 that is one day after the 9/11.  In spite of the potential danger of going out on 9/11, lots and lots of people still enjoyed walking.

I feel very grateful that my son, unlike other teenagers, did not share the not so good American culture of “independence” and still willing to walk the fair together with me.  He enjoyed watching all different Chinese cultural stuff and volunteered helping to carry the “goodies” I bought.  I remember when I was at his age, 14, I did not have the concept of going out with parents is shameful or sign of independence.  The big issue in the American education is lack of moral training.  I can understand this might be difficult of USA is the mixing pot and people from different cultures barely mixed like salad.  However, there are some special moral concept about relationship between parents and children from China that categorize that children should pay special respect to parents and elderly.  I have followed this concept and I never talked back to my parents even though I did not agree to their points of view sometimes.

Putting on my hat of “realtor”, it is truly amazing how the real estate price had been supported by streams of new immigrants.  I have many clients who literally shipped their money from China to buy real estate properties in San Francisco and nearby cities.  No wonder, the house price at the Sunset district of San Francisco seems have not dropped much, maximum 20% which is nothing in comparison with other places.

Thank you for checking in with my blog and feel free to contact me if you have any real estate needs or opinions about this blog.

Mr Sing Dao Contest 2011

Recently I encouraged my son Gene to enter the Mr Sing Tao Contest 2011.  At first, he had no idea of what it was and after he googled it, his comment was this was really si-si.  Anyway, he noticed my response and how happy I was picturing him enter into the competition and agreed to try.

I remembered one famous Hong Kong actor once said at the Prize Award Ceremony,” if I were the winner, the competition was very fair, if not, it was not.”  I 100% agreed to this point of view.  Who won as the Mr Sing Dao was very subjective to the judges but who won the Mr Physical, however, was very objective.  Gene has been working out everyday for the past few years in preparation for his “fighter dream” and this led him to get his first award of Mr Physical.  He had completed the 3 different physical trial and had been the champion on the first two, lifting the most up within 30 seconds the heavy ball and jumped the most times on the heavy rope in 30 seconds (I had counted for him, of course).  I was so happy that he enjoyed it and I enjoyed it.

It had taken up a lot of time for rehearsal etc. but I would say this was also a very positive experience.  He told me that he did not have stage fright or maybe he had conquered that.  He is also the final 3 competitors in the talent competition.  He performed playing drum but did not perform well enough.  Maybe the set up time was too short (1 minute allowed for setting up the whole drum set) and Gene had to move his stool in the middle of the performance.  Anyway, according to his knowledge, all competitors would only win one prize and since he already won the Mr Physical, he could not be Mr Talent.

Mr Sing Dao, 2011 Nathan Ng

The Mr. Sing Tao came out to be the guy who posted the not so good looking picture in the newspaper (not photogenic, maybe).  However, I knew that he had prepared well and had been very thoughtful.  He gave one dozen roses to the audience during the cat walk and had answered the question tactfully and humorously (has the ability to entertain the audience which is the essence of this kind of competition).  I also have to praise Mr Talent, Grant Lim.  He had joined the Mr Sing Dao Contest 2010 but still came back to try the second time.  He must have a lot of confidence in himself.  I like this “not giving up” attitude.

Mr Talent, Grant Lim

On the whole, I would say this is a fair competition as I totally have no relationship with Sing Tao Newspaper or Sing Tao Radio Chanel.

Many consumers may already aware that on top of the “old” homebuyer tax credit, there is the new “$10,000″ award for California homebuyers.  However, I always encountered my clients ask the following questions that  I think you may like to know as well.

1.  MY FRIEND HAS JUST PURCHASED A HOUSE IN CALIFORNIA BUT S/HE CAN ONLY GET $7,000 CREDIT AND NOT $8,000 CREDIT, WHAT COULD BE THE REASON?

Answer:  Your friend must have fulfilled all criterior for the first time homebuyer’s credit such as purchasing his/her first home as principal resident.  However, I bet the house price has not exceed $700,000 because the amount of tax credit is 10% of purchase price not to exceed $8,000 for First-Time Homebuyers or $6,500 for Long-Term Residents.

2.  MY FRIEND IS A FIRST TIME HOMEBUYER BUT IS REJECTED TO RECEIVE ANY FIRST TIME HOMEBUYER TAX CREDIT, WHY?

Answer:  If your friend earns over $145,000 per year as single or $245,000 as joint tax filers, s/he is not entitled to such credits.

3.  I WANTED TO BUY A HOUSE NOW BUT WOULD IT BE BETTER IF I WAIT UNTIL MAY SO THAT I CAN GET THE NEW CALIFORNIA TAX CREDIT?

Answer:  That will be your choice.  If you enter a written binding contract by April 30,2010 and close it before June 30, 2010, you will be able to get 10% of purchase price not to exceed $8,000 as a First Time Homebuyer or $6,500 for Long-Term Residents.  However, if you wait until May 1, 2010 to enter into a written binding contract, you will be eligible to 5% of purchase price, not to exceed $10,000.  You may consider this depend on the purchase price of your property.  Of course, you will have to fullfill all other criteria. 

4.  CAN YOU TELL ME MORE ABOUT THE ‘NEW’ HOMEBUYER TAX CREDIT?

Answer:  The new California law offers up to $10,000 for firsttime homebuyers or buyers of properties that have never been occupied.  Here is the summary:

Amount of Tax Credit:   5% of purchase price, not to exceed $10,000

Date of purchase:  From May 1, 2010 to July 31, 2011, but an enforceale contract must be executed by December 31, 2010.

Principal Residence:  Yes

Type f Property:  Single-family residence

Eligibility:  First-Time Homebuyer.  Up to $10,000 if the buyer (or buyer’s spouse if any) has not owned a principal residence during the three-year period before date of purchase. Or Never-Occupied Property: Up to $10,000 for a principal residence if the property has never been previously occupied as certified by the seller.

Income Restriction:  No

Maximum Purchase Price:  Not applicable

Repayment:  No repayment required if the buyer owns and occupies the property for at least 2 years immediately following the purchase.

Multiple Buyers (not married to each other):  Tax credit must be allocated between eligible taxpayers based on their percentage of ownership.

Maximum Credit for all taxpayers:  $100 million for first-time homebuyers and $100 million for never-occupied properties, both on a first-come first-served basis.  (It means it will fade out if a lot of new homebuyers applied and awarded).

When to Claim:  1/3 of total tax credit may be claimed each year for 3 successive years.

How to File:  Submit application to the FTB to obtain Certificate of Allocation.  The FTB may prescribe additonal rules and procedures to carry out this law.

Other Restrictions:  Cannot be an acquisition from related persons as defined; buyer or spouse must be 18 years old; buyer cannot be another taxpayer’s dependent; credit is allowed for only one qualified principal residence, and credit allowed cannot be a business credit under Cal. Tax & Rev. Code 17039.2

More Information:  FTB web site at http://www.ftb.ca.gov/individuals/New Home Credits.html.

5. WHO MAY BENEFIT THE MOST FROM THIS NEW HOMEBUYER TAX CREDIT?

Answer:  In my opinion, if you are the California taxpayers who earns more than $145,000 per year and is interested to buy a never-occupied single family house in CALIFORNIA, this might be your only chance to earn this NEW credit.

6. I LIKE NEWER HOME BUT WITH THE CURRENT AVAILABLE MARKET PRICE IN THE AREA I LIKE, I CAN ONLY AFFORD TO BUY CONDOMINIUM OR TOWNHOUSE, WHAT IS YOUR ADVICE?

Answer: Well, in that case, you should hurry because under the OLD tax credit regulations, not only Single Family Houses, but condominium, townhouse, manufactured home, apartment cooperative, houseboat, housetrailer, or other type of property located in the U.S. are all included.

7.  I SOLD MY PRINCIPAL RESIDENTS LAST YEAR, CAN I STILL BE ELGIBLE TO GET THE TAX CREDIT IF I BUY NOW?

Answer:  Again, you have to hurry too.  If you have lived in your previous house for 5 years out of the last 8 years, you are classified as Long-Time Resident and can get up to a maximum of $6,500 credit under the OLD homebuyer credit application.

8.  WILL I GET CASH FROM THE TAX CREDIT I APPLIED?

Answer:  YES under the OLD CREDIT.  Any amount of the tax credit not used to reduce the tax owed may be added to the taxpayer’s tax refund check. 

No under the NEW CALIFORNIA CREDIT

Sources:  http://www.car.org/legal/legal-questions-answers/2010

Thank you for your visit and please let me know if you want to receive a summary of the comparison of the old and new homebuyer’s credit.

Dear Reader:

This is a real story.  About 20 years ago, the housing market was also the buyer’s market.  Houses moved very slowly with little transactions and longer negotiation time.  At that time, it looked normal to many traditional buyers, i.e. buyers could ask for discount and not bidding up the offering prices.

I remember I met a couple who had just won a big lotto and looking for the best home in a good area of San Mateo County.  I showed them the best and they liked it.  At that time, the asking price for their ideal house was $650,000 and the sold comparables came out to be only $600,000.  Normally, this house had sat in the market for over 5 months.  The husband was willing to offer $630,000 but not the wife.  In view of the sold comparables, I found that maybe $610,000 was a good offering price.  Unfortunately, we have a competitor at that time and the seller did not even counter us. 

End of the story, this couple failed to get this house and the sold price happened to be $630,000.

Moral of this story, although we worked diligently and tried to help our clients get their dream house at the best price but if your clients really fall in love with a certain property, it is ok to pay over the market price than to lose it.

Do you agree?

Remember 10 years ago, I joined the part time Census interviewer in San Francisco.  I had been working very hard to approach many homeless people and encountered a lot of obstacles.  For example, I learned that many of them although physically are capable of working but mentally not ready or reluctant to get the identity varification such as social security card that they need for work.  I had also visited many homeless temporary shelter but even we brought in many statistics with our efforts (my team memebers and myself), the government at last decided not to include this group.

http://www.examiner.com/a-2495262~San_Francisco_working_to_prevent_Census_undercount.html

As indicated from the linked message, San Francisco had been undercount a lot and so a lot of justified funding is not allocated to San Francisco.  San Francisco has long been paradise for immigrant – legal and illegal.  Many illegal residents though work hard and pay their taxes will hesitate to report their existence because of fear of the strict new immigration investigation team.  A lot of them have limited education, speak very little English and are hard to persuade they do need to report.

I, myself, also try to google the answers to many questions relating to census but cannot find it.  I believe the govenment should advertise not only to report the head counts but also set up a multi-language hotline for people’s queries and questions.  Or if you know, there is one, please do not hesitate to let me know.

When San Francisco was compared to California 10 years ago (statistics based on 2000 census), I find that San Francisco has less white people about 49%, more Asians and less homeowners  and more people stay 5 year or longer (move less than other Californian).  Indeed the house price in San Francisco is considered quite stable, has not dropped to the extent as the other part of California.  I think this might be due to the preference of new immigrants, the influx of hot money from Asia especially China.

Your opinions are highly valued. 

After working hard for a few weeks with my investor client, she finally decided to make an offer on a Bank Owned property at Pleasanton, California.  As my routine practice, I provided her with the home profile, the recent sold comparables and she made a full price offer.  Since I always urge my clients to put an inspection contingencies (this is almost a must for my clients) and upon acceptance of the offer, the listing agent called me and emailed me the inspection reports on file.  The house happened to have been shifted previously (may be at 1989’s earthquake) according to the home report.  The foundation is intact and the termite is very minimum, only a few hundred dollars, and the price seemed to be the lowest in the area in respect to the conditions of the house.  In order to help my clients to make a reasonable decision, I asked the listing agent to provide an environmental report and he agreed and ordered it right away.  From the report, we found out the house was located within one mile of the fault zone and there was a nearby dam and during any rainy storm and in case the dam broke, this house may be washed away.   The worst part is the house was grounded to aweak sediments (soil deposited by the surrounding running river).   

The listing agent told me that this house used to receive $2500 per month as rental and it seemed to be very attractive to my client.  After I do the research on the rent price, my find out also supports this rental price.  My client wants to buy a house at a good location but the usual problem  is the rental income often times not in a good proportion of the house price.  What I mean is it could still be negative income for an investor even with a down payment of 35%.  For this property, my client will put 70% down payment and she can have a good positive income.

Here comes my dilemma:  If I tell my client to proceed with the purchase, she will listen and I will earn my commission income.  However, if I myself were the investor, I would back out from this transaction.  Of course, I would love to close this transaction but in view of three very important factors: fault, dam, river sediments, my client seriously considered my point of view and backed out from the offer.  Now, I need to work from square 1 again but my conscience feels at ease.

I think every real estate agent should hold up this ethnical standard.  What do you think?

Your opinions are very important to me.

Please feel free to put a comment or email me at justynato@sbcglobal.net.