Why So Many Chinese Buyers in Palo Alto and Along the Peninsula?

Everybody reads about the large supply of Chinese buyers who are buying homes here along the Peninsula.  There are many agents, one prominent one who we all know and now has a plane to fly his Chinese buyers around, who target the Chinese buyers very heavily.  Buy, why are there so many Chinese buyers and why are they buying here?

We all marvel at the prices being paid and the recent appreciation of 30% per year for the past couple years.  For those of us who live along the Peninsula, you may be surprised to know that real estate in Palo Alto, Atherton and Menlo Park may be a bargain when compared with other international locales. Heck, we aren’t even as expensive as New York.  Who would have thought 10 years ago that an investor from Shanghai might find a Manhattan penthouse affordable? Of the 10 most expensive cities in the world, New York is the only one from the U.S., said a recent report from England-based real estate consultancy Knight Frank and researcher WealthInsight. Monaco, Hong Kong, London, Singapore and Geneva all outranked New York. Sydney, Paris, Moscow and Shanghai rounded out the list. San Francisco, Palo Alto and Atherton, not even on the list.

In Hong Kong, which saw double-digit real estate price increases from 2009 to 2012, the average luxury home was valued at around $11,000 per square foot, the global real estate firm Savills said in a 2012 report. Yes, $11,000 per square foot! London, with its own booming real estate market, averaged $5,300 per square foot, while New York checked in at $4,100. Atherton and Palo Alto generally sells for $1,500  to $2,000 per square foot, quite a deal compared to the big guys.

For the 12 months ended in February, 788 homes worth more than $10 million each were sold in the U.S., according to real estate website Zillow. Slightly more than half were in the Los Angeles and New York areas. San Francisco, south Florida and Colorado ski resorts Aspen and Vail also saw some of the most-expensive transactions. Chinese Buyers, in particular, Chinese homebuyers increasingly are buying up high-end property in the U.S., Realtors said. China’s strong economic growth has generated dozens of billionaires and thousands of millionaires in recent years. They are attracted to America’s stronger property rights and a relatively stable political and economic climate, according to the National Association of Realtors.

So, why are so many Chinese buyers scooping up luxury properties? Because they are rich and prices here are a deal and they have property rights that might be hard to come by in their own country.  Hard to blame them.

With the worldwide economy getting better, I can’t see much of a slowdown to the pace of buying from our overseas friends.  Gary Kurtz of Alain Pinel in Menlo Park has Chinese buyers that he has never met but converse with on a regular basis and are looking for investment homes here in the Atherton area.  I find lots of Atherton and Palo Alto off market homes and I know they will make a relatively quick decision and buy without seeing as they trust my word and insight into the market.  It seems to be a win-win situation for sellers, Chinese buyers, agents and all in the luxury real estate industry.

Alain Pinel Realtors Now Number 5 in Nation

Not to toot our own horn, but Real Trends named Alain Pinel Realtors the number 5 largest broker in the nation with sales of over $10 billion dollars for 2013.  Not bad considering we are a regional company that is still privately held.  We have 29 offices and I would say a large percentage of the deals are coming from Menlo Park, Palo Alto and Los Gatos areas.  Our office is typically the number one or two office for the company as we have about 70 agents in our office and typically total over a billion dollars in sales annually.

Since I’m in the Menlo Park office, I have an affinity to Menlo Park, Palo Alto, Atherton, Woodside areas as my home territory but do expand to surrounding areas such as Los Altos, Los Altos Hills, Saratoga, Portola Valley, Mountain View and wherever is appropriate for my buyers and sellers.

Luxury real estate is my passion as is the company and our agents.

Off Market Home in Menlo Park for Sale

Off market homes are as big as ever these days and it’s important that you as a buyer are aware of them from your agent.  I focus on a lot of off market opportunities for my clients so please let me know what you are looking for and I can find it.

A recent property for sale off market is a beautiful newly constructed in 2013 4 bedroom, 2 1/2 bath home in the heart of Menlo Park.  The home has 1,925 square feet and has an open floor plan with hardwood floors, high ceilings, a beautiful chefs kitchen with marble counters, custom cabinets and large island.

Luxury real estate at an affordable price could be the tagline for this home as there are top quality materials and elements throughout the home. There are three bedrooms up, including the master, and one bedroom downstairs for guests and grandparents who don’t enjoy climbing stairs.  A fantastic great room and open kitchen highlight the downstairs floorplan.

Nice sized yard with cobblestone patio and fully landscaped perimeter.  2 car garage with lots of storage as well.

Asking price is $2,195,000 and will be sure to go fast like everything else in Menlo Park.  If you are not represented by a buyers agent and would like to see the home or get more information, call me at 650.543.1202 or shoot an email to me at gkurtz@apr.com.

Is Paperless The Way To Go? A Funny Example.

I love technology and use it in any way to help me in real estate. Whether it be to better communicate with my clients or make the offer process easier or just to track homes and what is on the market. Most people around the office know me as the tech guy as I try to help the technically challenged agents as it can be a daunting experience for agents who just haven’t used technology in their business.

One of the agents who is sometimes technically challenged sent me this funny little video about our ongoing technology vs paper debate. I think you will get a kick out of it, it’s very short so take a look.

The funny video.

Selling Your Home: Quick Tips Before You Sell

Buying A Home: The Key Elements

Open House Tips for Buyers

An open house can be an opportunity for you to get information about homes and the housing market. Open houses are a common real estate practice because they give an agent the opportunity to market the home and to meet prospective buyers.

Here are some questions you may want to ask:

• Are you the listing agent for this house? Busy agents sometimes arrange for a colleague or assistant to conduct the open house. Don’t assume the person showing the home is knowledgeable about the house or has met the sellers.
• How long has the home been on the market? Well-priced homes in good condition generally sell in a short period of time. Unless the local market is weak, you will want to know why a particular home is not selling. Are there hidden defects? Is it overpriced? Are the sellers requiring something that may seem unreasonable as a condition of the sale?
• Have the sellers received any offers? If the sellers rejected offers that were too low or had contingencies or conditions, you should find out before you experience the same.
• Is any furniture or fixturing being sold with the house? If you’re thinking of buying the home, there is no better time to ask whether the seller would be interested in including the patio furniture or the dining room chandelier.
• Are there any special costs attached to the property? Is there a homeowner’s association that has dues or fees? Are there particular tax assessments? Are there any natural hazard issues to be aware of? Are there any hidden costs of owning the home?
• How does this house compare to others on this street? The local agent may be able to speak about recent sales in the neighborhood as well as some interior ideas seen in other homes.

Purchasing A Home: 4 Tips to Make The Process Easier

Buying a home can be an emotional, time-consuming, and complex process. There are a few things that you can do to help make the process go as smooth as possible:

1. Check your credit.

Before you apply for a home loan, regardless of your credit, it’s a smart idea to obtain a copy of your credit report from the three major credit bureaus and review the information. If there are errors or things that need to be addressed, it’s easier to address them before you have found a house, than after you have found a house and are trying to close your loan.

If you know that there are a few blemishes on your credit, let your lender know what they are, why they are there, and why you are a still good credit risk. Lenders look at your credit to determine how likely you will pay back the loan. If you had extenuating circumstances – like a loss of a job or medical bills – let them know so that they understand that it is not likely to happen again in the future.

2. Get approved before you buy.

An approval means that a lender has reviewed your credit history, verified your assets and employment, and has approved your loan before you have found a home to purchase. As long as the home appraises for at least the purchase price, the loan should close.

Getting approved also gives you an advantage over other buyers. Your firm approval makes it easier for you to negotiate on the price of a home, than a person who is not approved or is pre-qualified.

While getting pre-qualified may sound official, it is really just getting an idea of what you can afford. Its having a person plug in a few numbers that you give them – your monthly income and your monthly debt – and getting an approximate payment calculated. From the payment, the calculator can approximate the house price range that you can afford. No information is verified. Because your assets, income or credit is not verified, a pre-qualification has little value when purchasing a home.

3. Find a great buyer’s agent.

Traditionally real estate agents represent the sellers in a transaction. When you are not working with a buyer’s agent, they are less likely to negotiate the best price or contingencies for you.

A buyer’s agent’s job and fiduciary responsibility (meaning legal duty) is to you, the buyer. Before working with an agent, establish if they are a buyer’s agent or a seller’s agent. After spending a lot of time with a Realtor, it’s natural to feel like you’re a team. But if they are not negotiating for you, then they are not on your team.

4. Learn about the neighborhood.

Often times the house you find may be in a neighborhood that you’re not familiar with, which is ok. It just means that you’ll have to do a little more research. If you find a house that you like, ask for a list of the neighborhood properties that sold in the last year. How does your home rank? Is it at the top of the price range? If so, it might be hard to resell. Is it average or on the low end? If so, great – as the other home prices go up in value, they will pull your home’s value up as well.

Check out the schools – are they sought after? A good school district means your neighborhood will always be valued by families which is a great reassurance to purchase, not to mention the value-add if you have school-age children.

Next, contact the police station and obtain crime statistics? Are they acceptable to you? Sometimes, if they won’t give them to you, it could be a cause for alarm.

Talk to the neighbors. The more people you talk to, the better sense you will get of who makes up the neighborhood and how they will effect your time spent in it.

Check out the location of the shopping, police and fire stations, schools, and air traffic overhead. These are all things that might affect your property value or quality of your life.

Homes For Sale Listing Not Accurate on Popular Online Websites

Home buyers and sellers often quote Trulia, Zillow or Redfin as their main source of real estate information. If they are out looking for a home, they check these popular online sites daily to see what’s on the market. All real estate agents know that the information definitely isn’t up to date for homes along the peninsula as there is so much off market activity and it’s kept between agents who work the areas a lot, so the online sites don’t have a clue to what’s really for sale here.

A new report by Redfin proves what we agents have known for a long time – the information on these sites isn’t accurate at all. I personally have received calls about listings that have sold months ago and have grown to find it fairly normal, but I never understood how bad the statistics really are. The study found that approximately 36 percent of the listings on the websites were no longer active.

Wow, 36%!

That’s a big margin of error. Do they do it so they can keep potential buyers and sellers on their sites longer and sell more page views and advertisements? Do they do it because there is a shortage of inventory in many areas and they don’t want to look like there isn’t enough information to keep home searchers happy? I’m not sure what the reason, but read the full article here.

This gets back to a plug for using a local real estate agent who has the latest information plus the off market listings.  I would estimate 20-30% of the business in this area if done off market, so if you really want to find a house, call a reputable agent.  I can help you with your real estate needs in areas such as Menlo Park, Palo Alto, Atherton and surrounding areas.  There are also plenty of other good agents as well who are professionals and take their jobs very seriously.  Working with clients to buy and sell luxury real estate is a demanding job as there are high stakes and very successful buyers and sellers who only accept the best agents to handle their transactions.  Relying on these websites seems like a step in the wrong direction and in an area of intelligent, successful people, this isn’t always the smartest choice.

Save Money, Refinance Now

Mortgage rates are at an all time low and home buyers are getting a great deal right now as some banks are even buying down the rate on purchase deals. I know you are busy, but even though you don’t plan on buying anytime soon, it’s still a great time to refinance. Banks are tight on getting the average person qualified for a loan, but if you can get thru the paperwork, it’s a great time to save money. How much money can you save?
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