This is the second large scale development under way in Foster City that will bring about even more change to this town in the coming years. The project will allow mixed commercial, industrial and residential uses on almost 21 acres. The proposal includes replacing approximately 289,000 square feet of commercial space in existing 1 and 2 story buildings with up to 296,000 square feet of commercial, industrial and office space in mid-rise buildings, an approximately one acre park and up to 730 units of housing. The business park environment is becoming obsolete in that area and this bold plan will breathe new life into it. I’m game for more restaurants!The project is in the master plan phase and an Environmental Impact Report is due soon. There has been some opposition to this project from some residents who worry that the height and density of the development will overwhelm the surrounding residential area. I’ll keep saying it (only because it’s true!). Foster City is really poised to become a destination spot. In 10 years it will be as strong a location as any in Northern California. Here’s a link to more about this project:PilgrimTriton

Since it was finished in 2002 the Parkside Towers project has been known, to me at least, as the Inktomi Mausoleum. This great big building sat looking awfully empty and sad since Inktomi disappeared, and for awhile I was afraid it’s only tenant was going to be Baja Fresh! (Just kidding!). Well, the building management and their agents have worked really hard and have filled the place. IBM should be moving in as of March and the lions share of the property is being filled by online personal assistant creator Rearden Commerce. This means that 400,000 sqft of office space is going to be filled up and this is yet another reason to feel positive about the Foster City economy and it’s effect on home values. For more info on this topic check out this link:

ParksideTowersLeased

It’s always seemed to me that the local media has had an overwhelming rain of negativity onto almost every Real Estate story it’s done for several years now. They were breathlessly awaiting the “bubble” bursting…in 1998! Here’s a few gems of collective media wisdom :

Houses cost too much for the mass market. Today’s average price is out of reach for 2/3’s of all buyers…Science Digest 1948

The goal of owning a home seems to be out of reach for more and more Americans…Business Week 1969

The era of easy profits in Real Estate have drawn to a close…Money Magazine 1981

If you’re looking to buy be careful, rising home values are not a sure thing anymore…Miami Herald 1985

Most economists agree…a home will become little more than a roof and a deduction, certainly not the lucrative investment it was…Money Mag 1986

A Home is where the bad investment is…San Francisco Examiner 1996. I LOVE this one most. Home prices have more than doubled since 1996 and the SF Examiner is a once a week freebie.

The map here actually tells a great story about the overall strength of our area in the middle of this current downturn. There are areas all around the Bay that are truly devastated. I’m sure glad we don’t live in Antioch or Oakley! Yet even closer to home there is a striking difference between Foster City and other communities in San Mateo county. For example, in Foster City there are currently 18 single famliy homes actively for sale and 10 pending sales. The small amount of inventory certainly contributes to higher property values. Of the active homes 2 of them are short sales. (A short sale happens when a homeowner owes more than the market will bear and they hope to get an offer and negotiate with the seller’s lender to accept less and close the deal.) In Daly City right now there are 211 active listings and 90 short sales or foreclosures! That’s 43% of the active listings! You’ll note that Foster City is in an area on this map that shows values have risen. It really is remarkable the disparity between areas like San Jose, Daly City and others compared to Palo Alto, Los Altos, Cupertino, and Mid-Peninsula cities like Foster City.

This map is a great antidote those old Real Estate Blues!

On Sunday afternoon I was driving to visit a friend of mine in Burlingame and I made the incredibly poor decision to stop by Peet’s Coffee in downtown San Mateo for a latte. Do you suppose I could find a parking place? I drove around and around for 20 minutes or more and after deciding that the latte wasn’t worth a cross town walk I made bad decision number two and headed for the downtown Burlingame Peet’s. Yes, I am stupid! Downtown Burlingame was worse than San Mateo. Why is it like this? Because they both have thriving, lively downtown areas filled with shops and restaurants and people want to go there. Both of them are destinations!

For as long as I can remember Foster City has lacked that kind of a downtown destination. As hard as we’ve tried it hasn’t been Edgewater Place or any of the other local shopping centers. For awhile it actually seemed to be that little strip center across from Costco that managed to hit all at once with Jamba Juice, Noah’s Bagels and Starbucks. It was hard to find parking there! As hard to believe as it is that was Foster City’s downtown for awhile.

As of last fall that’s all going to change. The city chose a developer, the Sares Regis Group, who’ll be creating a very exciting downtown area for Foster City on a large parcel of vacant land located between Foster City Blvd and Shell Blvd, and between the new Jewish Community Center and Hillsdale Blvd. The project is actually located on an 11 acre portion of the 15 acre City owned property in that area. The plans call for the following:

* A Continuing Care Retirement Community that would include Independent, Assisted and Memory care units as well as Skilled Nursing.

* A large outdoor area designed to host a variety of public and private events including outdoor seating for restaurants, a farmers market, art displays and entertainments areas.

* 31,300 square feet of retail/restaurant space in the first phase of the project and an additional 19,000 square feet of retail/restaurant in a future development phase.

The project should begin in 2009 and many of the design details are still not finalized but if this is worked out correctly, in my humble opinion, this project should effect property values in Foster City as positively as the Lagoons have. The inclusion of a downtown atmosphere, a destination spot, is just going to be a fabulous things for everybody in town. I don’t think it’s a coincidence that the property values in Burlingame, San Mateo and San Carlos have remained strong a a result of their downtown’s attracting people there. Foster City’s waterfront location is an esthetically beautiful aspect to life here and adding the fun of a downtown destination will only make Foster City stronger than ever. Maybe one day there will even be a Peet’s there! Here’s a link to more info:

VillageSquareDesigns

Way back in 2001 FEMA (Federal Emergency Management Agency) rewrote their flood zone maps and included the Shoreview and Sunnybrae neighborhoods in San Mateo…and as a result the residents there were forced to purchase flood insurance. FEMA conducted studies that concluded some risk for flooding could come from Bay tidal flows or from four or more streams carrying rain runoff through San Mateo and down to the Bay. As you can imagine, there was plenty of grousing. I sold a 89 year old lady’s home on 16th Avenue in Sunnybrae at that time and her house actually backed up onto San Mateo Creek. She was the original owner and had been in the home for over 50 years. She had no report of any pesky water intruding onto her yard at any time during her occupancy.

FEMA is again rewriting the maps and the word is that it will include Foster City by 2009. At issue appears to be the strength of the levee system that’s technically in San Mateo itself. The City of Foster City is attempting to work this out with both FEMA and San Mateo but it’s very possible that flood insurance could be mandatory in the future. Here’s what will happen: after FEMA etches this in stone your lender will be quick to react. You’ll receive a written notice that you’ll be required to carry, in addition to your current homeowners policy, a flood insurance policy. FEMA will offer a policy to you but it’s a great idea to contact your current homeowner carrier to see what they have to offer.

There’s an initial period of time when you’ll be able to purchase this insurace at a big discount. In San Mateo in 2001 it ranged from around $300.00 a year if you got in early to over $1000.00 if you didn’t. It’s my understanding that if you buy it early you’ll keep the lower rate going forward. Obviously it’ll be a good idea to stay in touch with your insurance professional to act early and to stay current on this situation as it effects so many Foster City residents. I promise to follow it closely too and blog about any changes. Here’s a link to a recent story about this fun topic:

Floodinsurancelink

As you’ve undoubtedly been made aware, Congress has passed an economic stimulus package that, among other things gives checks for $600.00 to many individuals and $1200.00 to many couples. This story got lots of press last week and was signed by the President earlier today. What seemed to have gotten lost a bit in this package, at least as far as I was concerned, was the much larger issue of the Fed raising the conforming loan limits.

Starting in 1970 Fannie Mae was authorized by the United States government to purchase residential mortgages. Fannie Mae worked with Freddie Mac to develop uniform mortgage documents and national standards for what would become known as conforming loans. Because these loans are insured by these agencies and are repackaged into the secondary mortgage market it makes the demand for them to be greater than non-conforming loans. The limit for these loans has been $417,000 and because of our very pricey area a huge number of loans given here are Jumbo loans…meaning anything over $417,000. Since the “Mortgage Meltdown” last summer it’s been very difficult for lenders to package and sell Jumbo loans and thus Jumbo loans have been more expensive to get.

Inside the stimulus package is a provision to raise the $417,000 limit to a level of $729,000 in Foster City and other Bay Area communities. This will allow many people to refinance and/or purchase homes with a significantly better interest rate and should really stimulate our market. The increase will only be available for 1 year.

Several steps must occur before these loans will be available to us including:

1. Fannie Mae & Freddie Mac must assess their internal impact to determine the delivery approach the will require of mortgage lenders and investors.

2. They must then communicate these requirements to mortgage lenders and investors.

Bottom line…it’s going to take awhile for this bureaucracy to swing into action. Here’s some other things to consider:

These increases are temporary.

The $729,000 loan limit is not nationwide, it’s going to be available here but if you have investment property outside of the Bay Area the limit will probably be lower there.

The lending environment that will surround these new conforming loans will still not resemble the market of a few years ago in that the lenders requirements are going to be stricter. We still won’t be seeing zero down, stated income subprime loans…and that’s a good thing! It’s a good idea to talk to your lender and get more details on how this program will affect you. I think it’s going to be a big benefit for everyone in Foster City.

In the past 5 to 7 years the phenomenon of staging has become a big part of selling a house in this area and as the market softens the question of it’s value will inevitably come up. My answer to this question is, yes…if you want top dollar for your home.

The concept of staging came from developers who wisely created environments in new model homes that really showed off the possibilities of their product…and sold a bunch of them as a result. As a response to that success several entrepreneurs began to offer the same services to Realtors and sellers to enhance the look of their homes prior to marketing them. It’s really an art and often includes things as small as towels, dishes and even a random negligee strewn suggestively over the corner of a bed. The idea being to create an emotional appeal to a property that, hopefully, would subtly make someone want to buy it. The cost for a full staging will typically run from between $3000-$5000 and, naturally, a really big property would be more expensive than that. That doesn’t include expenses for things like fresh paint, or upgrades that may be useful like new light fixtures or kitchen counter tops.

I’ve read in other blog posts the suggestion that buyers are smart enough to be able to see through staging and that it is an unnecessary expense and I used to believe that myself for quite awhile. Here’s two stories that changed my thinking.

I was competing for a listing in San Mateo once and when asked about staging I said I thought it was not that important and if we just cleaned the place up a bit we would do just fine. I told them I thought they could get $900,000 if they did what I said. My competition recommended staging…he won and got the listing. They both painted the house, inside and out, and fully staged it. It got 15 offers and went well over $1,000,000…the first house in that area to do so! I was amazed…and I also began a relationship with a stager that week. The stager I use, Claudia Connor with Casa Bella Lifestyles, is really outstanding with both design and color implementation. She really understands what creates a mood and how that mood inspires action.It’s an impressive talent!

My second story was a short time later. I had a listing on a busy street in South San Francisco and my clients were going to paint the interior, as well as do some other upgrades and eventually we were going to stage it prior to listing it. Myself, Mr. Seller and our painter all thought we should use off white with white trim…Mrs. Seller wanted more color. I had Claudia come over and she immediately recommended “Monroe Bisque” for the base and “Shaker Beige” for the trim. (She has this thing about color memory, go figure!). All the guys shut up and listened to her. At the first open house three people said to me “What color is this? I love it!” There were four houses on the market in that neighborhood at that time and we had the worst location on that busy street…yet we were the only listing that got multiple offers. The house went $31,000 over asking.

I think there’s a very real question about the expense of staging right now since it is possible that a home could take more than a month to sell but I’m a firm believer in creating a plan to sell a listing…and staging is part of that plan. Even in the slower market of 2007 I had several listings sell quickly that were staged. My listing on Lurline in Foster City was a good example. The sellers painted everything inside and out, including the kitchen cabinets and put a new granite counter top on and of course we staged. The end result was 11 offers and $129,000 over asking. Here’s a link, the living room, dining room and master suite are Monroe Bisque and Shaker Beige (my good luck colors!):

LurlineVirtualTour  

When the most famous restaurant in your town is Chevy’s, then maybe your town could use some new restaurants. I actually really like that Chevy’s too, and we go there alot. The waterfront location can’t be beat, but can you imagine thinking of a Chevy’s when you think of restaurants in San Mateo or San Carlos? Even Redwood City has a number of new, good restaurants! Turtle Bay, in my opinion is really excellent. I’m crazy about the “Lazy” Dungeness Crab and their Cioppino! I’ve had some great meals at Kobe in Edgewater Place and ABC Seafood too…I just wish there were more like them. How about you? Wouldn’t it be great to see something like San Carlos’ ”Town” or San Mateo’s Kingfish or Ristorante Capellini in Foster City? 

Having alot of experience at any given thing usually means that we’ve survived the consequences of whatever mistakes we’ve made. After almost 20 years of being in Real Estate I can honestly say that I’ve survived my share and I’ve also learned from the education I’ve received from many clients and friends who have shared their mistakes with me. I’ve also seen clients of mine make mistakes that have cost them too, and were in many cases unnecessary and ran contrary to my advice. Here’s some of the more memorable ones:

1. Not Buying at all This may sound silly but I’ve seen this happen over and over again. It’s completely understandable to be frightened of buying in this crazy area but it’s really a fear that has to be challenged. I remember clients in 1991 who couldn’t get off of the fence because prices seemed so high and overwhelming to them. They never did buy. They’ve been providing for their landlord’s retirement for 20 years now. Wide waterfront single family homes in Foster City were selling for $500,000 then. Buying property on the Peninsula might be one of the safest investments anywhere and then add to that the uniqueness of Foster City’s water theme and it’s an almost sure bet.

2. Not using an experienced Real Estate agent As a listing agent who has on many occasions reviewed offers for sellers, and on most of those occasions they were part of a multiple offer scenario, I can tell you there is a very dramatic difference between an offer presented by an experienced agent versus one presented by an inexperienced agent. The simple fact is that the inexperienced agent rarely prevails and ratifies the offer. The experienced agent’s preparation, history in the area and negotiating skill is invaluable. On top of that is the very large issue of familiarity. In Foster City here’s how that helps you, an experienced agent is familiar with:

Landfill, foundation issues, flight pattern areas, schools, higher return on investment neighborhoods, parks, local events, restaurants, litigation issues in various developments, upcoming assessments in certain developments, traffic issues, local inspectors, insurance related issues…to name a few. In the past several years it’s been common to hear agents complain about the quality of agents that often come from out of the area that are representing buyers on purchases here. Forms are not filled out right, offers are faxed over without lender approvals, disclosures have not been signed off…there’s a large number of ways an inexperienced agent can defeat the plans of a buyer to purchase a home, and for what? Buyer’s are not paying a commission. There are actually plenty of really good local agents here, use one.

3.Relying on too much technology I have had quite a few clients in the last few years that are actually overly attached to their computer when it comes to home buying. Please don’t get me wrong, I love this technology! It helps me a ton and has served me very well over the years but the simple fact is there is no substitute for doing the legwork. I have clients that look at a virtual tour or still photos that I send them from my website and make a decision about the property by that exclusively. Often they delete a great property and ask to see a bad one based on what they see in pictures. The internet typically can’t tell you if a house is in a bad location or not either. We have a photographer in my office that can make an old broken down barn look like Buckingham Palace and I’ve seen other photos shot in bad light that is unflattering to a fantastic house. The same principle goes for Zillow and sites like that as well. Go see the place before you make a judgement.

4. Giving too much weight to aesthetics I’ve had other clients who only want to see homes with remodeled kitchens and bathrooms, preferably ones with granite and stainless steel appliances. I have to laugh when I see that of the 8 houses they have picked to see on my website, 6 of them are in bad locations or are grossly overpriced or have some other major flaw. The old rule, that’s been almost run into the ground, about location being the most important thing is absolutely true! It get’s more true as well in a flat market. It’s better to buy a place with a little aesthetic challenge, that you can do later, than to pay too much for a home that has a $10,000 granite slab kitchen from Home Depot. Remember the 3 biggest rules for buying property…location, location, location.

5. Not having the finances in order up front Always get a pre approval from a lender before jumping into the water. Many buyers get so excited about the process of buying they neglect the basics. If you’re not ready right now, that’s OK. I’ve had buyer’s this year that are very well qualified that still struggled to get their loan in this current lending environment. Create a gameplan with a lender you can trust and set a goal for when you can get there…even if it’s a year or more. Don’t even think about zero down any more. You’ll be really glad you did.

6. Forgeting you have a Home Warranty On every sale with every buyer I’ve ever worked with is a Home Warranty policy. That’s an insurance policy designed to last a year that covers most everything in a home. If there’s a plumbing leak, electrical malfunction, appliance malfunction, furnace problem, etc it’s covered. You pay a small service charge and they fix the problem. Unfortunately it’s easy to forget you have one of these gems. It used to be common for me to bump into a client and ask him/her how the new place is and they tell me a story about some issue, ruptured hot water heater, broken furnace, garage door opener that broke and the hassle they had finding a good trades person for it and then I ask them if they used the Home Warranty. Usually there was a moment of dead silence and that ”deer in the headlights look”. It’s easy to forget about this thing when the problem occurs 6 or 7 months after closing. I always have this conversation now repeatedly before and after the sale. 

I think there isn’t a subject that comes up about Foster City as commonly as the subject of Landfill does. The town was essentially created in the early 1960’s from the marshland that was Brewer’s Island and 14 million cubic yards of material were deposited there to create the basis of what now is Foster City. On all of the standard disclosures a buyer will see, no matter where they buy, are mandatory geological reports that designate, among other things, an area’s “liquefaction potential”. Historic evidence has suggested that landfill on Bay mud is a danger of liquefying and every few years the U.S. Geological survey releases regional earthquake hazard maps that highlight areas they see as worry-some. The last one in 2006 labeled Foster City as “high risk”. Consequently folks tend to get concerned and Foster City has always had some kind of stigma as a result. What’s always confused me is that I tend to not hear so much concern about the large areas of San Mateo that are fill as well as Redwood Shores, which is just like Foster City. The fact is that in 1906, 1989 and 20 other earthquakes throughout the region which covers 9 counties and 180 cities, the chance of liquefaction-the result of a shake so hard that water and sand mix together and become sandy liquid-is one instance per every 1.5 miles. That puts Foster City at a chance for 2 or 3 instances. There were 3 documented instances in Foster City in 1989 and they were small. I’ve heard it said that there were less insurance claims made in Foster City in 1989 than in most other outlying, non landfill areas. It’s also been commonly reported that the engineered landfill that was done in the 60’s when Foster City was created made a huge difference in it’s durability and stability during an earthquake. The USGS maps do not take into account any difference between the type of fill in San Francisco’s Marina District, for example, and Foster City’s engineered fill. Here’s a link to the City’s website and their perspective on landfill in this area:

LandfillLink