Friday, January 25, 2008

1031 Exchange Identification Rules 101

3 property rule - identify 3 properties and then close escrow on one, two or three of them. This is the most commonly used rule.
200% rule - identify up to an aggregate of 200% of the value of the relinquished property. You then must close escrow on one or more of them. No limit to the number of properties identified as long as they total in value no more than 200% of the relinquished value. Common when going in to a lower priced area or coming from a high priced single property.
95% rule - unlimited number to be identified and you must close escrow on 95% of the properties that are identified. Common when buying a block of condos with separate parcel numbers which are run as an apartment building.
If you want any guidance on how to use these rules or how to navigate the dates of the 1031 exchange process, give me a call or drop me a line. I think I've seen it all!

Santa Clara County (REO) Bank Properties Available

This is our updated list of bank owned REO homes available in Santa Clara County:

Address, City, bedrooms/baths, square feet & asking price:

QUICKERT RD, SARATOGA 6/5.5;4707 $2,175,000
ALDRICH WAY, SAN JOSE 3/2;1220 $513,900
BERRYWOOD DR, SAN JOSE 3/1;900 $439,900
CHAPEL HILL WAY, SAN JOSE 5/2;1593 $477,500
CHULA VISTA DR, SAN JOSE 2/1;1168 $574,900
CURTNER AVE, SAN JOSE 3/1.5;1635 $564,900
EASTON PL #42, SAN JOSE 2/2;975 $269,900
FLEDERMAUS, SAN JOSE 3/1;1176 $319,900
FLORENCE AVE, SAN JOSE 2/1;896 $419,900
FOOTHILL CT, SAN JOSE 4/2.5;2124 $649,900
JUDITH ST, UNIT #3, SAN JOSE 2/1;903 $249,900
LANIER LN, SAN JOSE 3/2;4791 $499,900
LANTERN WAY, SAN JOSE 3/2;1152 $459,900
N 14TH ST, SAN JOSE 2/1;1064 $399,000
ORLEANS DR, SAN JOSE 4/2.2;1352 $539,900
PEBBLE CT, SAN JOSE 2/2;1045 $369,900
S. 12TH ST #109, SAN JOSE 2/2;1130 $384,500
S. 20TH ST, SAN JOSE 3/2;1247 $500,900
SPIRO DR, SAN JOSE 2/1;938 $400,000
SUTTER ST, SAN JOSE 2/1;928 $369,900
TERILYN AVE, SAN JOSE 3/1;960 $374,900
TERILYN AVE, SAN JOSE 3/2;1178 $399,900
WARRING DRIVE #3, SAN JOSE 2/1;903 $284,000

Give us a call to see any of these great opportunities.

Tuesday, January 22, 2008

Zillow and Intero Real Estate

Only certain companies are posting all their listings on mega sites such as Zillow and Trulia. Intero has a bulk feed into both these sites. Alain Pinel and Coldwell Banker do not. How can you pass up approximately 7 million unique real estate visitors every month combined???
Mario Pinedo, CCIM
Intero Real Estate
415-269-6249 cell
408-342-3155 office
Sent via my BlackBerry

Jumbo loans under 5%

There is a very aggressive lender offering jumbo rate home loans with 1 point under 5%! The jumbo rates which had a spread of over 200 basis points over conforming rates in the last 6 months are now falling in line with their smaller amount brethren loans. This is attributed to the secondary market coming back to life. This is a very good sign.
Mario Pinedo, CCIM
Intero Real Estate
415-269-6249 cell
408-342-3155 office
Sent via my BlackBerry

Monday, January 21, 2008

Palo Alto Homes No Foreclosures Here

Silicon Valley companies are doing very well as is evident in premier communities like Palo Alto. Here's an interesting scenario for both the home buyer and the investor. A coworker just bought a home in midtown for $1,425,000 - not huge at all - 3 bedrooms, 1 bath and maybe 1,300 square feet on a normal lot. One day's rental listing on generated 4 applicants all willing to pay her $4,800 asking rent! Does this make "investment sense"? Not if you consider cash flow as the only aspect of return on investment. Investment return also involves appreciation, debt reduction, tax benefits, depreciation deductions and holding period. Will my coworker make money on this deal - in my opinion - absolutely yes - does it take guts and risk - yes also - but markets like Palo Alto will forever be in demand - so the risk is quite mitigated.

The or just THE 88

Kudos to the marketing team behind The 88 condo building in San Jose. The ad in the San Jose Business Journal is brilliant.
"A 22 story Declaration of Independence. I want my city without the white picket fence. Without three-car garages, trips to the hardware store, to big-box chains, and every trip to anywhere that looks exactly like where I just came from. You can take your rakes, mowers, blowers and your leaf-packed gutters and keep them far away from me. And while you're at it, keep the minivan, the outskirts, and your keeping up with the Joneses, and keep it all to yourself. Just leave me to my own devices, leave me the skyline, spontaneity, and a lust for life, and all its experiences. Leave me a home above, the city below. And leave me THE 88."
Very cool way to market a building.

Friday, January 18, 2008

"Bank Owned REO's in Santa Clara County"

Property Listing Price
2590 KNIGHTSBRIDGE LN, SANTA CLARA 3/2;1369 $515,900
15545 QUICKERT RD, SARATOGA 6/5.5;4707 $2,175,000
1555 ALDRICH WAY, SAN JOSE 3/2;1220 $513,900
11300 CHULA VISTA DR, SAN JOSE 2/1;1168 $574,900
1076 CURTNER AVE, SAN JOSE 3/1.5;1635 $564,900
2503 EASTON PL #42, SAN JOSE 2/2;975 $269,900
1532 FLEDERMAUS, SAN JOSE 3/1;1176 $319,900
2989 FLORENCE AVE, SAN JOSE 2/1;896 $419,900
856 FOOTHILL CT, SAN JOSE 4/2.5;2124 $649,900
4970 GAZANIA DR, SAN JOSE 3/2;1384 $469,900
5598 JUDITH ST, UNIT #3, SAN JOSE 2/1;903 $249,900
2640 LANIER LN, SAN JOSE 3/2;4791 $499,900
3266 LANTERN WAY, SAN JOSE 3/2;1152 $459,900
53 MILLAR AVE, SAN JOSE 2/1;1000 $489,900
699 N 14TH ST, SAN JOSE 2/1;1064 $399,000
1627 ORLEANS DR, SAN JOSE 4/2.2;1352 $539,900
1312 PEBBLE CT, SAN JOSE 2/2;1045 $369,900
951 S.12TH ST #109, SAN JOSE 2/2;1130 $384,500
20 S.20TH ST, SAN JOSE 3/2;1247 $519,900
1159 SPIRO DR, SAN JOSE 2/1;938 $400,000
127 SUTTER ST, SAN JOSE 2/1;928 $369,900
1528 TERILYN AVE, SAN JOSE 3/1;960 $374,900
1451 TERILYN AVE, SAN JOSE 3/2;1178 $399,900
792 WARRING DRIVE #3, SAN JOSE 2/1;903 $289,900

Thursday, January 17, 2008

6-Unit Investment Apartment Complex

Gross Rents $62,580
Other Income $1,200
Gross Sched. Income $63,780
(Vacancy) $1,877
Net Gross Income $61,903
(Expenses) $16,647
Net Operating Income $45,256

Investment Analysis
Purchase Price $895,000
Down Payment $358,000
Loan Amount $537,000
Interest Rate 6.50%
DCR 1.15
Cash on Cash 1.55%

Expense Details
Property Taxes $11,367
Insurance $2,394
Management $4,067
Gas & Electric $1,864
Water & Sewer $1,472
Maintenance $4,466
Garbage $698
Miscellaneous $1,686

GRM 14.0
Cap Rate 5.1%
Price per Unit $149,166
Price per Square Foot $248
Square Feet 3,604
Lot Size 5,662
Age 48
Zoning R3

Newer HVAC systems
Fully Occupied Units
Professionally Managed
Very well maintained
Excellent 1031 Property

Rents Increasing
Vacancy Rates Down
Silicon Valley Job Growth
Attractive Finance Rates
Solid San Jose Asset

If you need any additional information call or email me...

Wednesday, January 16, 2008

Duplexes, Fourplexes in Cupertino Schools

Buying in Cupertino is not cheap by any means. One solution to entry into the market is buying a duplex, triplex or fourplex and living in one unit. Many of these properties where built with "owner-occupant" quality units. An example is some of the Pollock & Gambord style fourplexes that have a very distinct owner's unit in the front. These units typically had upgrades over the other units such as forced air heating, fireplaces, garages, dishwashers and more.
There are two duplexes and two triplexes that we like in the Cupertino schools area.
$799,000 for a duplex at 2884 Malabar, Santa Clara, CA with Cupertino schools.
90 Kiely Blvd, a triplex for $869,888
Lapa Drive, duplex, for $829,000
Craft Drive, $1,298,000, a triplex across the street from Cupertino High School.
If you want us to run the numbers for you on how to make this work, just drop us a line. These are very nice properties and great way to buy Cupertino schools.

Tuesday, January 15, 2008

Very low price point for a NNN investment in the Greater Bay Area

This offering consists of an office building, two service bays and a parking area for the La Mesa RV Center, a regional chain of RV dealerships. Founded in 1972, La Mesa RV Center, Inc. has grown from it's original La Mesa, CA site to nine locations in California, Nevada, Arizona, Florida and Georgia. La mesa RV is a full service dealership,offering sales, financing, service and repairs.

This is a strong tenant in a booming market. Well worth a look.

Cap Rate: 6.25%
Lease space included: 1,309 sf office, Service Bays, 110 Parking Spaces
Land included: 1.15 acres
$81,000 of net operating income to the new buyer.
Offered at $1,296,000

Call to tour this great investment.

100% leased high growth center in booming Roseville

New NNN Retail Shopping Center in High-Growth Market of Roseville, CA
Excellent Location Near Housing and Businesses
Average In-Place Rents Below Market Asking Rates
Annual Rental Increases and 100% CAM Reimbursements in All Leases
To Be Delivered Free and Clear of Debt

This offering includes a 100% leased four-tenant retail building within Arbor View Village, located at the southeast corner of Pleasant Grove Blvd and Foothills Blvd in the upscale market of Roseville. The average rents at the offering are just over $2.65/sf, putting it at or below market for West Roseville creating stability and income. Arbor View Village is located in a market with growing rents,a growing population and a steady demand for retail space.

This is a true 6.5 Cap Rate deal with the ability for new financing. Excellent 1031 exchange property. Offered at $3,150,000. Call us for a marketing package.

Monday, January 14, 2008

Multi-Family (Apartment) Investment Seminar February 12th in Mountain View

Yulin Lee of Residential Pacific Mortgage and myself - Mario Pinedo, CCIM of Intero Real Estate are speaking at Michael's in Shoreline Park, Mountain View, CA on Tuesday February 12th from 6:30-8:30pm. The topic of the seminar will be on apartment investments in the Bay Area. Yulin is an expert in lending on apartment investments. She will bring a great amount of knowledge to this forum. I will be speaking on market conditions, rates of return, investment strategies and more.
We will be providing appetizers and drinks to keep you focused! If you are interested in attending, please RSVP with me via email. The class will be limited due to room size to 40 people.

Mobile Home Financing from Bank of the West

Mobile Home financing is slightly different than financing the typical home. Rates and terms are different. Qualification standards are differ also. One of the largest lenders in the San Jose market is Bank of the West. My favorite officer at Bank of the West is Leo Ortiz (408-998-6800)who specializes in mobile home loans.

The typical loan scenario is something like this:
80% loan amount - 20% down payment
minimum 620 FICO score with lower rates at 720
1977 construction or newer
no prepayment penalties
20 year amortization
double wide homes or larger
Rates at approximately 8% with 1 point in fees
escrow and other closing costs may be financed too
46% overall debt to income ratio
1-2% points for the loan fees

For my current listing on Monterey Road, the payment would be $1,070 per month plus $850 approximate space rent with 20% down payment on a $159,900 purchase price.

Let me know if you want to see this wonderful home.

Thursday, January 10, 2008

San Jose Apartment New Laws & Regulations Seminar

New Laws and Regulations for San Jose Apartment Owners and Managers

The City of San Jose Housing Department is hosting a free seminar well worth attending.

Legislative issues that impact how you manage your rental units
The City of San Jose's rent control ordinance
Renters insurance
Code enforcement
Fair housing
Reasonable accommodation and modification
and much more...

Thursday, January 31st, 6:00-8:45pm
San Jose City Hall, Wing, Room W-120
200 E Santa Clara Street, San Jose, CA 95113

RSVP Robert Lopez 408-975-4402 or

Tuesday, January 8, 2008

Short Sale or Foreclosure - What is Best?

Why consider a short sale of a property in lieu of giving the property back to the bank via a foreclosure? The biggest advantage is to avoid a foreclosure mark on your credit report. Also, this is a more cooperative approach with your lender. The lender may be more forgiving by giving you more time to market your home. This means you can stay in your home longer. There also may be equity in your home which can be saved if you sell your house (this then would not be a short sale). If there is equity and you are just not able to keep up with the payments, then your net may be more than if the property sells at a trustee sale auction. The trustee sale auction will almost always yield a far lower sales price than what the normal market would bear. If you are facing the strain of higher payments, please do the first thing, talk to your bank and be honest about the situation. If you need help in the sale of your home, I'd be glad to review some scenarios for you.

Monday, January 7, 2008

Stunning Bank REO in Saratoga

4,700 square feet of gorgeous 5 year old home in the hills of Saratoga on 5+ private acres. Saratoga schools. Views of the entire South Bay up to San Francisco. This is a fantastic opportunity. This home was for sale in 2002 for $5,500,000. Call for a private tour at 415-269-6249.

Sunday, January 6, 2008

Lake Tahoe Area Shopping Center for Sale

There is a very well located shopping center for sale on the way to Lake Tahoe. Offered at $2,950,000 with a very attractive assumable loan. 6.5 cap rate. Fully occupied. Shadow anchored by Safeway and Long's. Call us for this great opportunity.

Downtown Los Gatos Homes Caliente

Los Gatos - the cats in Spanish - hot - caliente... never mind. I'll come up with a better tag line next post.
The significant message here is this: homes are selling briskly in the Los Gatos market. We are tracking a couple homes that just sold quickly after coming on the market. One of which got a "preemptive offer". These are homes with everything you need and then some. Over 2,000 square feet, 3 and 4 bedrooms, good parking, great locations, nice lots, etc in the $1,800,000 and higher price ranges. This spike in activity is evident in the last week. As is the spike in real estate activity all across the west valley. The lower price ranges, in Los Gatos and in other parts is not springing back as quickly, but it will.
I see the confidence and the acknowledgement of the true scarcity of good homes in the higher income/asset buyers. They know the valley is solid and they want to get in before the window of opportunity slams shut.
It is already too late for that in Palo Alto, parts of Menlo Park and Atherton. Put on your track shoes, the spring is near and we will all be running.
By the way, any takers to run with me at the Bay to Breakers or the Rock and Roll Marathon in San Diego in June?

Thursday, January 3, 2008

Palo Alto Homes - High Tide - When Will it Ebb?

A mere 10 homes on the market in all of Palo Alto under $1,500,000!!!
AND of these:

two are under 900 square feet and on 2,000 square foot lots
one is under big power lines
one needs to be finished or torn down to rebuild new!
two just came on the market - so they will sell this weekend
one is on a very busy street
one is really a triplex
one is essentially on HWY 101
only one Eichler is truly on the market for a few weeks and available

Compare this to Campbell, West San Jose, Santa Clara and other neighborhoods east. A tale of two cities perhaps?

Santana Row Loft - Very Good Deal - $541,500

1 bedroom unit with a den below, 1.5 bath, 1151 square feet, overlooking the east valley foothills - a very good deal at $541,500. It does need some TLC - but nothing that cannot be overcome. The Margo building is a very nice location to live in. Underground parking is a short elevator ride down. This is a price lower than when the units started selling 2 years ago. When the sub-prime mortgage seizure stabilizes - these units will appreciate quickly to where they were last year - in the $600s. This is a great opportunity.

Wednesday, January 2, 2008

Seller Financed Silver Creek Valley Country Club Home

Great deal for 2100 square feet within the gates of Silver Creek Valley Country Club. Offered at $1,038,000. This home sits on the 13th fairway and is in great condition. Seller is motivated. I think this is the best deal in the country club at this very low price point. Call me for a tour.