How much does a backyard pay you?

As I am reviewing some sold homes that earned multiple offers, selling over the asking price; I saw a common thread – really cool outdoor space!  Indoor-outdoor flow is a vital part of California living and a special backyard can make a small house feel bigger.  For the property below that I listed last year in Rockridge, I spent some time browsing on Houzz and Pintrest to see what I liked. I then shared my likes with my clients and we came up with this.

 

This is the backyard at 406 61st Street in Rockridge before we placed it on the market.  My clients had always wanted to renovate the space, but after an extensive interior renovation, they  put the outdoor space on hold.

This is the backyard at 406 61st Street in Rockridge before we placed it on the market. My clients had always wanted to renovate the space, but after an extensive interior renovation, they put the outdoor space on hold.

Here it is after flagstone, raised veggie beds and eco-lawn was installed with an irrigation system.

Here is the outdoor “room” after  the addition of flagstone, raised veggie beds, drought tolerant perennials and eco-lawn, and an irrigation system. 

A view from the

A view from the opposite direction. Within one month the raised beds were completely packed with cabbages, fresh herbs and lettuces.

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buying smart in this market

I am currently trying to find several buyers homes. The challenge is that new listing inventory is down by 12%, so there is heavy competition. Buyers are frustrated: few homes are available, and determining the appropriate offer price is particularly challenging.

When trying to determine the right offer price with few sales, looking at comparable data often won’t cut it as our inventory is unique and sold data captures history, not the future, of value. This means that you have to analyze the market condition, the property condition, how much you love a home and the level of interest among other parties.

I strongly discourage buyers to write offers when they have a very low chance of being the winning bid. The first thing to understand as a buyer is listing price often has no correlation to real value. A seller can price a home at $1 to create an auction-like frenzy. In fact, the more offers a seller receives, the higher their price may go.

How does that affect you? When the next homeowner prices their property, the comps and competitive market dynamics will lead to a higher price.  You have just contributed to a market increase.

Last year I had several clients who did not want to adjust their search parameters to better meet their budget. They felt there was a chance (although slim) they could find that rare property that fit all of their requirements . That rare property didn’t show up, prices continued to increase, and they were priced out of the market.

The bottom line is the Oakland and Berkeley marketplace is very unique, no two homes are alike. Don’t  buy something that you do not want, but be sure to balance market realities with your expectations. See the chart below regarding the current inventory.

This chart illustrates what many buyers feel

This chart illustrates what many buyers feel

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How Important Are Trees and Landscaping?

I was reflecting on some of my past listings that had that magic factor, the homes that had more than a half dozen offers and here is one common thread, the outdoor space was often thoughtfully maintained and improved – a place that many buyers would want to seek refuge in .  Mature trees have many benefits, they provide cleaner air, shade, a picturesque outlook, privacy from neighbors, and sound when the wind sweeps through the leaves.  San Francisco magazine did an Oakland issue last year, as so many SF residents are migrating to the Oakland marketplace.  One of the main reasons – we have backyards!

Guido_TREE

My client Cassidy is the Vice President for Tree Sculpture, http://www.treesculpture.com/contact-us.  If you have valuable and/or large trees you may want hire an arborist to maintain and keep them healthy.

Cassidy sent this information over to me as he understands how valuable trees and landscaping is for homeowners:

Due to the prolonged drought, trees throughout our region are under extraordinary stress. As a result, many tree species are much more susceptible to breakage and failure… especially with the winds and rains associated with winter.  Knowing what signs to look for and performing proper preventive care will reduce potential hazards and help to preserve the health and beauty of your highly valued trees.

To learn how to identify 6 potential hazards and 5 actions to take to preserve your trees, please visit: http://www.treesculpture.com/blog

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Walkable Neighborhoods

Many of today’s buyers are willing to pay a premium to live in a walkable community.  Here are the median prices of some sought-after neighborhoods in Oakland and Berkeley. Keep in mind, with charts like this, one outlier property that sold very high or very low can skew the median prices.  To truly understand what a home’s value is, one must analyze property condition, disclosures,  inventory levels and property interest. Additionally, I was aiming for neighborhoods where the median price was about 1 million bucks and this is why these neighborhoods were chosen.  What are your thoughts about prices these days?

 

This data was collected in mid-December

This data was collected in mid-December 2014

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