Fog City Guide

What is community policing? It is the police force working WITH the community to solve the situations that arise in a community that the community can’t solve on their own. All of us involved in Neighborhood Watch Groups know how important community policing is when we seek ways to solve problems that arise in our neighborhoods. We have different problems and we want different solutions. Different solutions to different problems are the essence of community policing and an involved citizenry is essential to the solution.
The Board of Directors of SF SAFE has communicated our desire to the Mayor and the Police Commission for a committed community-policing Chief as the next Chief of Police in San Francisco.
In the May 24th Chronicle Matier & Ross wrote an article headlined “Fong Takes Parting Shots at Possible Successors” laying out actions taken against some very popular captains. What is going on?
I think we are seeing politics at its ugliest, leaks to the press of the names of the finalists from outside the SFPD causing them to withdraw their candidacy, actions against the in-house SFPD finalists in retaliation. I don’t think this is what the citizens of San Francisco need or want.
I believe we want a Chief that is committed to working with the community, modernizing the police force, instituting the best practices as described in the Police Executive Research Forum (PERF) – basically bring our police force into the 21st century and strive to make it one of the best police forces in the country. Inside – outside it doesn’t matter, what matters is that success be measured by the accomplishments of those goals.

Yesterday I took the opportunity to go listen to a talk about our market. Ms. Appelton-Young had some very interesting comments that I believe are worth sharing.

Talking about how the market got to the dire situation it’s in now; she said in reference to the zero down loans, “The banks were buying properties without the buyers having any stake in the home”. Think about that the next time you hear about homeowners needing to be stabilized. I think those buyers are really just tenants in bank owned properties and it’s the banks that need to be stabilized after buying so much real estate.

She also talked about the long held concept in real estate that downward pressure on pricing is typically slow. This is called the “sticky price” phenomenon. It speaks to the actuality that if there is downward pressure on values homeowners are reluctant to sell. If they have a choice they hold on and stay till prices stabilize. So in thinking why this downturn is different she realized that many of these sellers or defaulters had no equity in the property and with nothing to lose they chose to walk away. In this slide there were more folks that had no equity, because of the 100% loans and the other low-down, teaser rate product. Her conclusion in this thought process was that “you are not a homeowner when you have no equity”.

When she took out her crystal ball and made predictions for the state she feels that the low to mid price market will see sales grow and price rise because the sub-prime borrower’s loans have reset and the banks are disposing of them now. The mid to high end will see declines in the coming period because this credit crisis has gone global.

San Francisco’s market has held up well throughout 2008 and last month I reported an increase in median and sales volume. The remaining problem is the access to money. The spread between the 10 year T-bill and mortgage backed securities is a high, 3%, when it typically runs about 1.6%. Jumbo loans, which just about every buyer in SF needs, are therefore very expensive.

President Obama has released his latest housing plan and the conforming rate is back up to $729,500. Which if you have if you have 20 percent for your down payment ($182,375) you can buy a $911,000 home as long as your payment is only 35% of your monthly income, about, $12,500.

The numbers for the San Francisco market show a rebound in units sold and in median price from February to January before. Has the bottom occurred?
The median price for single family homes went from $606,500 to $707,500 which is an increase of 14%. The median condo price went from $660,000 to $792,500, a 12% gain.
The unit sales also show a 19% positive growth with the units in contract also grew by 9%.
The inventory has grown also for the past two months. On February 1 inventory was up 23% over January and it is up another 11% over February numbers putting our market into a definite “Buyers Market” with the SFH absorption rate sitting at 6.44 months and condos at 12.57 months.
With the tax incentives placed in the stimulus package along with interest rates being at historically low levels this is a very good time to buy. Action would seem to be needed now as the price mix is trending up.

Large jump in inventory. The volume of closed sales were down significantly in January and inventory is up significantly leading to a large jump in the absorbtion rate. Look for the absorbtion rate to fall due to the number of properties in escrow on the first of the month.

In 2008 the national real estate market experienced a sharp decline in pricing as credit markets woke up pto the fact that greed was allowed to play too big a role over the past few years.

Blame has been laid at the feet of borrowere who should not have taken out loans and lenders who should not have given out loans to the borrowers who shouldn’t have borrowed. So Ameican to blame the individual and not recognize the fact that from the top down everyone believed simply there was money to be made and since we are all supposed to take advantage of every opporunity to make money – Go For It!

The breakdown happened when finance products were made available by investors through securitized mortgage bonds. Looking back it looks to this simple observer that a Madoff – Ponzi scheme was pulled. Rates on sub-prime loans were very attractive to investors so more and more investors sought them out. Finally the well ran dry as all Ponzi schemes do and with no more money coming in, interest rates resetting on the sub-prime loans it became time to sell the asset that was no longer affordable.

Supply increased across the country which drove prices down and that meant that even the prime borrowers that used adjustable mortgages to purchase were forced to sell because the interest rates reset and the price of the property declined with the glut of inventory. Areas hardest hit were areas with large amounts of new construction.

San Francisco City & County has done pretty well when compared to the rest of the region, state and nation. My data is taken from the San Francisco Association of Realtors multiple listing service. I gather the data on the first of each month to get a snapshot of the inventory. My analysis shows that our market has held steady up till the last quarter when sales dropped off and inventory increased. At the end of the year single family homes had an absorbtion rate of 4.8 months, which indicates a balanced market verging towards a buyers market and condos at 10.6 months which is clearly a buyers market.

Pricing data in San Francisco is only of value as a trend tracking tool. Market value will vary by neighborhood and site inside each neighborhood. That said, median price in the City has decreased from Januray to December. The reflection of median price is skewed towards the larger quantity of homes sold in the lower than median price market.

I have published data and graphs on the Real Estate Page. Just click over to see what’s going on. I have other data and am happy to share it with interested parties. Feel free to contact me.

If you have 15 San Franciscans in a discussion you’ll get 16 opinions.  Somebody can be counted on to have 2 opinions.

It’s strange how we can find our passions.

In 2004, in a meeting at my Coldwell Banker office an agent brings up the 2004 Housing Element of the City’s General Plan. He spoke against the increase in density along transit corridors in the plan. I reminded the office that as Realtors we take an oath to support home ownership opportunities and if we don’t support higher density then we are not supporting housing opportunities.

Naive and simplistic, but it did provoke discussion. For the next few years I worked on the Housing Opportunities Committee of the Association of Realtors and basically dip the tip of my little toe into the issue.

After I joined the Board of Directors of my neighborhood and was asked to be the delegate to the Coalition of San Francisco Neighborhoods (CSFN), I learned that the depths of the housing issue is full of rocky shoals waiting to sink the ill informed. I tried to enter a discussion about the Market Octavia plan which had just been passed by the Board of Supervisors. I found that I really knew very little and not at all qualified to discuss the issue.

Here, I’m a native son and a Realtor and I can’t discuss the City’s Housing Element of the General Plan. This plan is required by law and outlines the direction the City is taking on the issue of housing. The General Plan contains other elements but I’d like to believe that local Realtors know the housing element and are active in the vision. Guess what, not so much.

Since then I’ve studied, discussed and returned to SF State to study Urban Plannning. Last week I was invited to a gathering of local housing and neighborhood activists for the annual party. We discussed housing, planning, politics and other quality of life issues in San Francisco. Opinions ranged from smart growth advocates to no growth advocates, the discussion was lively, ideas and experiences were exchanged and discussed. Local personalities were parsed and history was revisited. If anything was resoplved it could only have been the opening of eyes and ears to different opinions and allowing growth.

San Francisco is at a very significant junction. The City has grown in population for the fist time in decades. the housing shortage is getting worse within the City limits event though condos are being created at a fast rate. San Francisco is building more “permenantly affordable housing” and calling for much much more in the 2009 Housing Element. We are finishing the rezoning of large areas of the City to meet future visions while looking at a future of non-oil dependant transportation.

My neighbors west of Twin Peaks are banding together to keep the life style and density of thier neighborhoods. Among the people that are concerned about the issues that swirl around housing issues and future development passions run very strong. When I sit and listen to developers, non-profit and profit, talk about where can they create more housing the western neighborhoods are clearly lusted after.

I had a good write up in the Examiner on Sunday December 7, 2008. It’s a regular feature on what San Franciscans like to do in the city. Favorite places.

http://www.sfexaminer.com/entertainment/My_City_Fresh_ingredients_good_food_and_a_thrilling_view.html

It has been too long since I’ve written here. The last post was about my neighbors opposing the transit change. We opposed it very well it seems because the SFMTA backed off the change completely. The bus line will reamin on its historic route in Miraloma Park.

My writing time has been applied to papers for classes I’m taking at SF State. I decided to persue a degree in Urban Studies and am focusing on housing issues. The city is goiing through a major revamp of it’s zoning and planning guidelines and I will be working on the sidelines influencing the direction where ever possible.

More to come . . .