Romantic hideaway in Russian Hill, Some Thoughts on Legislative Effect Versus Intent and New Listings

April 17, 2008

Hello my favorite people!

Home of the Week – Secret Hideaway in Russian Hill
Last week on Tuesday tour, I was lucky enought to have time to stop by Gloria Rogan’s listing at 39 Havens.  Havens is a walking only street parallel to Union off of Levenworth.  This home was something right out of Tales of the City — a charming Edwardian 2bed 1.5 bath with a panoramic view roof deck that can only be reached by several flights of steps.  It has major East Bay views from Master Bedroom and from dining room. The price is $1,675,000.  They are considering offers on May 2.  To see more pictures, click here:
Recent Legislative Changes Have Unexpected Consequences on the Mortgage Market
It is sometimes tragic how legislation can have unintended consequences.  In April 7ths New Yorker, James Surowiecki explains how changes to the Bankruptcy Code in 1995 may be greatly contributing to the current foreclosure crisis nationally, which has in turn led to the current difficulties in the real estate and lending markets.  It seems that it is now harder (and had longer term consequences) to walk away from credit card debts than it is to walk away from a home.  The same banks that lobbied hard for these changes are now paying the price. . . for the entire article, click here:  I
As I was checking interest rates this week, I found that after Congress’s raising the conforming loan limit, rates above $417k appear to be actually worse than they were before April 1.  I was puzzled, so I called Colette Moorhead of All California Mortgage and asked her for her perspective.  Here’s what she had to say:  
“One of the most anticipated proposed palliatives for the housing crisis was the increase in the conforming loan limit in high-cost housing areas like San Francisco. When the program was announced the assumption was that these new limits would be similar to the higher limits in Hawaii and Alaska. In those states, although the conforming loan limits are higher – $625,000 versus $417,000 – the interest rates and underwriting guidelines are identical.

Conforming loans are securitized and sold by Fannie Mae and Freddie Mac. These so-called ‘government sponsored entities’ provide an implicit guarantee to investors that the loans will be repaid; investor confidence in the securities translates to low rates for the borrowers. That is why conforming loan rates are lower than the rates for jumbo mortgages. The conforming loans originated in Alaska and Hawaii are packaged into the same security pools as all other conforming loans, even though the loan limits are higher. This is why the interest rates are the same for those larger loans.

However, the new program is being instituted in a completely different fashion. Fannie Mae and Freddie Mac are concerned that investors will shy away from their securities if they included the new higher limit conforming loans in the same pools with the lower limit loans.  If this happened, rates would go up for all conforming loans.  So, they created separate pools for the new higher limit loans.

Because the loan limits are higher the investors perceive that these ‘jumbo-conforming’ loans are riskier, and they want a higher return to invest in the securities, as well as tighter lending guidelines. The implicit guarantee that the government will stand behind Fannie and Freddie has always translated into higher prices for their securities, and lower rates for their borrowers. Now, however, investors are very shy of any risk, and the fact that these new jumbo-conforming securities are being sold separately from the other conforming loans has caused investors to pull back, keeping the rates high, and the guidelines tight. In other words, a jumbo-conforming loan is just a jumbo loan, and nothing has changed – at least not yet.”

Colette Moorehead specializes in residential refinance and purchase loans.  To find out more about her, visit or email her at


Recent Market Activity and Upcoming Listings
Sales activity and closing prices for the last two weeks shows that we continue to buck the national trend of prices spiraling lower and lower.  For single family homes, 41 sold over asking price, 23 sold at asking price and 13 sold at asking price.  The picture for condos and tics is much more mixed, with 32 selling above asking price, 32 selling below and 18 selling at asking price.  In 2 to 4 units, there were very few sales, with just 2 selling above asking price, 4 selling below and 2 closing at asking.  In the city, as we have micro-climates, we also have micro-markets.  The homes sold under ask are concentrated in certain areas.  The secret for success this year is really studying the exact situation a property you are thinking of buying or selling.  A few blocks can dictate a complete strategy change – and I find my buyers and sellers need my expert guidance on this now more than ever.

And now for Paragon’s Upcoming Listings.  You might notice, there seems to be a bit more at the high end than usual.  I think that is because the high end really is not as affected and is continuing to trade at normal prices and volume levels despite what is happening in more affordable price ranges.  As always, if you see anything that piques your interest or that of a friend, I’d be happy to get you in early for a private showing:

$3,000,000 / Pacific HGTS/ BR/BA:3/2.5   / PKG:2 – Single family home on double lot set in the middle of an English Garden. Designed by Henry Gutterson in 1825, Additionally there is a guest cottage with an additional bath.

$3,000,000/  Noe Valley/ BR/BA: 3/3  PKG: 1 SFR  thoughfully renovated 30’s home. 3000 sq ft. Detached 3 sides. So facing garden + terrace. Bay views. Open LR/DR, Den, Media Rm, Office. Rare home for SF.

$1,499,000/ UKIAH/ BR/BA: 3/3 PKG: 640 Acres Wine Country Estate 2 hours from the Golden Gate, private, magnificent views, stunning indoor/outdoor remodel. Redwood forests, meadows, hiking and biking trails.   

$1,250,000/ Telegraph Hill/ (right under Coit Tower) BR/BA:    2/2  PKG:   1  Quintessential San Francisco condo w/stunning views of the Bay and Bay Bridge.  This spacious, top-floor condo features nicely updated baths and kitchen, bamboo floors and a private deck that seems to sit atop the Bay.  This is a great condo for your clients who want to be near everything.

$1,249,000/ BR/BA: 2/1 + 2 home offices     PKG: 1 garage    Restored Victorian cottage in the heart of the Castro!  SFR up plus 2 large home offices or other flexible space down with separate entrance.  Orig. mahogany wainscot, granite kitchen, spa bath, all systems upgraded, hot tub, outdoor shower.  A charming retreat!

$1,050,000/ South Beach BR/BA:  2/2   1 car deeded parking 180 degree views of Bay Bridge to Twin Peaks.  Built in Murphy bed and office, upgrades throughout.

$859,000/ GUERNEVILLE/ BR/BA: 2/2      PKG: 6:  A unique Russian River home occupies a sunny clearing inside 10.5 acres of pristine, private redwood forest. A bright, airy floor plan is ideal for entertaining, with cathedral ceilings, hardwood floors, and elegant urban style. High-speed Internet, Restoration Hardware and Kohler throughout; a cozy office is plug-and-play. Five minutes to Guerneville, 15 minutes to coast and wineries/

$749,000 /  Midtown Terrace/ BR/BA:  2/1 with unwarranted   BR/BA: 1/1 down – flows very nice so it feels like a split level not a room off the garage.  PKG: 1 Car – Garage + ample Street parking/  Main level consists of 2 bedrooms and 1 remodeled bath, remodeled kitchen with ss appliance, living/dining room combo – new windows, new roof, refinished hardwood floors; downstairs has an additional bedroom/bath (legality not warranted by seller), recently painted inside and out, very private, landscaped rear yard with sprinkler system, updated systems – move-in ready and priced to sell!  

$699,000  / Excelsior/ BR/BA: 2/1     PKG: 1       Brief description:  nicely remodeled Marina style house with 2BR, 1 bathroom, French doors leading from the kitchen to the back yard. FDR, wood-burning fireplace, 1-car garage. LARGE semi-finished room down with hig ceilings. Hot Tub & outdoor shower in back yard.

$519,000 / North Waterfront/ BR/BA: 1/1    PKG: 1 / currently rented for $2,500mo; Tenant moves out 4/22. Great corporate rental, 2nd home (furn. incl.)

$499,000 /Emeryville/BR/BA: 1/1   PKG: 1—Exquisite and very large NY Style, conversion loft, Emeryville Warehouse, large bedroom which is semi private (with a door), bathroom is split and accessed via bedroom and foyer, open kitchen, dining, living, hi-ceilings, plenty of storage space, in-unit laundry, one indoor parking space, Views to the north, slightly west and east to the Oakland/Berkeley Hills with great natural light.

Pocket Listing:

$2,995,000, /Buena Vista Park/ BR/BA: 4/5    PKG: 1  Exquisitely renovated Queen Anne across from Buena Vista Park, sweeping City views from LR, DR, kitchen & Master en-suite, designer finishes throughout including Walker Zanger & Ann Sacks tile, Viking, Wolf & Thermador appliances, Dornbracht faucets, custom paint colors, also features a media room, laundry room and wine room.  

$1,895,000 / Monterey Heights /  BR/BA: 4/3.5     PKG: 2       Great opportunity to get you clients into contract before publicly marketed. Remodeled 4/3.5 with FDR, 3/2 upstairs, 1br down plus family room. Small back yard.     

$995,000 / Noe Valley / BR/BA: 3/2  PKG: 2    2 level stand alone condo that feels like a SFH; No shared walls; Deeded patio/deck; Diligently maintained ($0 pest); Meticulously refurbished (owner is a property inspector);

$799,000 / Cole Valley/Haight Ashbury /BR/BA:   2/2   PKG:  1 car + storage.  Top Floor newer styled condo in small 3 unit building.  Currently Tenant Occupied until July 1st.  Hard to show but I do have great photographs to start.  Fantastic light and storage, with large private patio off Master Bedroom with dead on views overlooking St. Ignatious Church.  Seller willing to entertain offers off market    

Price Reduction:

New Price: $819,000  Old Price: $859,000 / Twin Peaks/Upper Market/ BR/BA 2/2 PKG: 1 Another fabulous property by the architect/owner, Joel Karr,of Group 41. Dramatic open floor plan, stunning architectural renovationsm splendid top flooir condominium. Handsom kitchen features granite slab countertops,abundant beautiful maple cabinetry, new appliances.

And last but not least – SF expands Recycling program in honor of Earthday, April 22

Reader Kelly O’Dea asked me to pass along the most recent info on acceptable recyclables for the blue cart…After next week, SF Recycling companies will accept plastic cups, tubs, containers, and toys in Blue Carts.  Still no styrofoam, plastic film or bags.  For complete details, see


I trust you found this newsletter informative and that I continue to be your resource of choice for all your real estate needs.  I sincerely appreciate your reliance on me and your referrals of your friends, loved ones and associates my way whenever they have real estate business to attend to. If you are interested in knowing more about how the market is progressing, or know anyone else who wants the inside scoop, just let me know and I’ll jump right on it.
See you soon!