Janie and John's May Newsletter

Real Estate Insights

May 2024
A quick 5 minute read

On Market Predictability

If predicting the short-term movement of the housing market was easy, we'd all be rich (long term...home prices increase at a healthy clip).

Just a few of months ago The Fed was expected to lower interest rates multiple times this year. Not surprisingly, this led to a certain optimism in the market after a rather "meh" 2023. To a large extent it felt like buyers had woken up and our typically crazy market was, well, crazy again.

Fast forward to today and it is looking increasingly unlikely that The Fed will lower rates at all in 2024. If logic prevailed, you'd expect that this might lead us back into a slower market - but you would be wrong! Maybe it is the "spring market" factor, the recent strength of the stock market, or the realization that higher interest rates are just our new reality, but the current market continues to be vigorous. The vast majority of sales in our office continue to receive multiple offers and serious buyers are still out in force.

So, if a change in The Fed's expected actions didn't cause a housing market slowdown, what might? Possibly the upcoming presidential election. Maybe. Or some other significant event that nobody foresees. What we can tell you is that home buyer attitudes can change quickly both positively and negatively, so if you ever want to know the very latest, just give us a call. We keep our fingers on the pulse of our local market.

Lessons Learned During Construction

As you may know, we are in the process of adding 720sf to our home. While most things have gone very smoothly thus far, there have been a few surprises along the way (and remember, our profession is houses).

*NOTE - if you are contemplating remodeling, adding on or rebuilding, we strongly urge you to consult with us early on. Over the years we have absorbed many lessons that will help maximize your ROI, speed the project along, and keep your expectations real! And we have contractor referrals.

What surprises have come up thus far? So glad you asked!
Permits take time - From the date we first submitted our plans to the date we received our stamped permit took about a year. And even when the county indicated everything was approved, they still wouldn't issue the permit until we proved that tree protection and drainage control measures were in place. We knew permits would take some time, but c'mon, Stanford Football Stadium was built in less than a year.
Construction is expensive - When we started this project in 2022, we estimated construction costs to be in the $500-$550/sf range (e.g. pre-Covid construction cost range). Now that we are underway it looks like current construction costs are more like $700-$750/sf. Inflation is everywhere!
That's a lot of rebar - We have a new appreciation for the construction process. Not only are there a lot of details to consider, but also a lot of precision. The sheer quantity of rebar in our new foundation, each piece individually cut and bent to fit, is impressive in itself.
On site drainage is required - We expected to have to put in a drywell to help keep drainage on site to replenish groundwater, but little did we know the dimensions would need to be 12'x12' by 4' deep. Think modest swimming pool. The pile of dirt in our backyard from this is taller than John!
Keep your checkbook handy - In addition to the builder, architect, engineers, etc., there are numerous additional expenses and fees we didn't fully anticipate. Fire protection district fee. Yep. Elementary and high school district fees. Check. And don't forget that finishes (e.g. shower tiles, flooring, bath fixtures, doors, etc.) are all separate expenses, too.

Despite the many "surprise" lessons we have learned, we are excited to see our new addition taking shape. As of today, our foundation is poured and a massive delivery of wood is starting to transform into framing. We love our architect and general contractor as well as the guys doing the work. And pretty much everyone we have talked to who has lived through such a project has said it is totally worth it! We can't wait. Now, where did we put our checkbook?

* Regarding the picture, rest assured that nobody is crazy enough to let John drive the excavator with the motor running!

Local Market Trends

We have access to a tremendous amount of real estate data, most of which is way more current than you read in the press. If you want to take a deeper dive into the latest numbers, start here:

San Mateo County Real Estate Report
Santa Clara County Real Estate Report

Links not working? Email jbarman@compass.com and I will send you a PDF of the same info.

Want to see the data for a specific city? Let us know and we will gladly forward that along!

Featured Listings and Sales

Coming soon ~ Serene Setting with sublime views

Foxwood Road, Portola Valley

3 beds, 2 baths plus office in 1,600 sq. ft.
Call for List Price

Sold ~ Classic Charm in old palo alto

2314 Ramona Street, Palo Alto

4 beds, 2.5 baths in 2,405 sq. ft.
Listed for $3,998,000

Luxury Property Collection

Looking for a luxury property or even a brief escape from reality? Flip through our online magazine, Compass Luxury, for some of the most exclusive listings in the United States.

Please feel free to forward this newsletter to friends and family - and remember, we are never too busy for your referrals!

Janie and John Barman

DRE #01270223 & #01281597
Realtors®
M: 650.759.1182
jbarman@compass.com

Compass is a real estate broker licensed by the State of California operating under multiple entities. License Numbers 01991628, 1527235, 1527365, 1356742, 1443761, 1997075, 1935359, 1961027, 1842987, 1869607, 1866771, 1527205, 1079009, 1272467. All material is intended for informational purposes only and is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No statement is made as to the accuracy of any description or measurements (including square footage). This is not intended to solicit property already listed. No financial or legal advice provided. Equal Housing Opportunity. Photos may be virtually staged or digitally enhanced and may not reflect actual property conditions.