Kathleen Pender’s article in the June 7 Sunday Chronicle was a real wake-up call. About 50% of retirees will not have enough money to retire. What are we going to do? To keep working is one solution; another is to figure out ways to generate income other than working and to greatly reduce our expenses. Most people who have lived and worked in the Bay Area for awhile want to stay here. Housing is a major expense. If we can reduce our housing expenses, it will be much easier to retire here in the Bay Area.
A first thing to consider is how to reduce your mortgage expense. You might want to refinance if your interest rate is higher than the current low rates or you might want to consider a reverse mortgage.
You could rent out rooms in your house to generate extra income. Another option would be to downsize to a smaller condominium or house or build an accessory dwelling unit in your back yard (or a friend or family member’s back yard) for you to live in while renting out the larger house. Buying or renting a house with friends would be another way to reduce expenses. Dividing the cost of a mortgage and other housing costs would be a great savings here in the Bay Area.
Affordable senior housing is also available, but you need to plan ahead to be sure you will be able to move when you need to. Most facilities have waiting lists or have closed their waiting lists. For the HUD subsidized senior buildings, maximum income limits are $31,250 for 1 person and $35,700 for 2 people. The Alameda County Senior Housing Guide lists all of the facilities in the county and you can call 2-1-1 for information on current vacancies.
The good news is that we are very fortunate to live here in the Bay Area and the bad news is that it is a very expensive place to live. There are options available and it would behoove us to consider all of our options.
The articles about real estate that we read in the newspaper, magazines and on-line generally are not relevant to our East Bay communities. We did not experience the large numbers of foreclosures and property devaluations that occurred in the rest of the country. Many of our neighborhoods have maintained their values well although very few properties have been coming on the market in the last 2-3 years. Each spring I take a closer look at MLS statistics to get a better idea about what is actually going on here in our East Bay real estate market .
Click on the Real Estate tab at the top of this page to see the actual data I compiled of sales of single family homes and condominiums in several East Bay communities and neighborhoods in the first quarters of 2013 and 2014. If you are receiving this post as an email, click here for the data tables.
Generally, supply in the East Bay is still down and the demand continue to rise. Except for Piedmont and the Oakland zip codes of 94610 and 94602, inventory decreased from the first quarter of 2013 to the first quarter of 2014 in all neighborhoods. Berkeley showed the lowest decline (8.2%) and Rockridge the greatest decline (44.0%). Except for Oakland 94609 and Rockridge which had price declines, all neighborhoods showed significant price increases between the first quarters of 2013 and 2014. Berkeley showed the greatest price increase (19.0%), followed by Oakland 94610 at 15%. Condominiums in all areas are doing well; the average prices in all areas increased during the time periods.
Many sellers receive multiple offers for their properties and buyers are writing many offers before they purchase a home. In 2013, 98% of the sellers in California received multiple offers and the average buyer wrote 5.9 offers before getting one accepted. Of the sellers receiving multiple offers, 77% chose the highest offer, 47% chose the best qualified buyer, 39% took the offer without contingencies and 14% took the offer with the shortest close.
The current marketing strategy is to list properties about 25% below what the property is expected to bring and this has proven to be a very successful strategy for sellers. Buyers are having a very difficult time. Many are being over-bid time after time. We also have many buyers coming across the bay from San Francisco because they have been priced out of the market there. These buyers think our East Bay listings are bargains compared to what they can get in the city so they are also competing with East Bay buyers. Many of the properties on the market are going to them.
In the last few weeks, the Piedmont market has mushroomed. It is our most expensive neighborhood and sellers there have been holding on to their properties for many years. From the first quarter of 2013 to the first quarter of 2014, the number of properties on the market is up 13% and the average sales price is also up 13.3%. In Piedmont there are currently 17 active listings and 14 have recently sold. Last weekend six new properties came on the market.
I think that sellers in other parts of the East Bay are also realizing that they have waited long enough. This is what our market needs. We should see a significant increase in the number of properties coming on the market in the next few months. Combined with the historically low interest rates, there should be lots of new homeowners in the East Bay.
The Transition Network (TTN) is a national organization for women over the age of 50 who are dealing with transitions in their lives—career, life, health, housing and others. Because of the high cost of housing and the lack of affordable housing options in the Bay Area, the local chapter has implemented a new program: TTN-HOME—A Community for Senior Women Exploring Housing Options. This new program was developed from survey feedback provided by participants who attended meetings in 2013.
In association with the Brain Exchange, TTN-HOME focuses on older women who are interested in new housing options and who are eager to maximize their independence as they get older.
The TTN-HOME hub provides:
1) a central meeting ground for women to discover new ways of thinking about housing issues;
2) networking opportunities to connect with others who have similar housing concern
3) a venue for exploring specific housing options and resources;
4) and most importantly, support to one another in this new and uncharted territory critical to our age group.
During the next six months, women will be encouraged to bring housing related concerns for the group to process, using the brainstorming techniques developed by the Brain Exchange. At each meeting the group will process 4-6 questions. Questions have included:
1) How do I find housing right away in my specific geographic area?
2) How do I find a landlord who will be sympathetic to my desire to create an urban farm in the back yard?
3) How do I find a group of compatible women to share a large home?
After the group discussion women self-select the housing option they are most interested in—shared housing, co-housing, renting or buying property together or general options. Color coded name tags are provided so women with similar interests can easily identify and network with each other.
Plans are also being developed for quarterly half-day workshops that will explore different aspects of housing in more depth to help women become better informed about their options. This combination of brainstorming, networking and workshops will help women find they support they are looking for, begin serious exploration with others of like mind, get clarity on their next steps and share success stories.
Meetings are held at Finnish Hall in Berkeley on the fourth Thursday of each month.. For more information contact Arlene Reiff (email@example.com) or visit the TTN website (www.thetransitionnetwork.org)
The Bay Area’s first senior co-housing project, Phoenix Commons, is now under construction along the Oakland-Alameda Estuary in the Jingletown neighborhood of Oakland. Ground was broken for the $21,000,000 project on January 9 and it will be completed in early 2015. There will be 41 units, about half one bedroom and half two bedroom units. Prices will range from $450,000-$630,000 with a monthly fee of $450. All individual residents and at least one member of a couple must be 58 years old.
Phoenix Commons is more than a building; it is also a senior community. Residents will own their condos and have access to more than 7000 square feet of additional common space. The building is designed to encourage interaction between the residents. They will have weekly meals together, go to movies and give each other rides to the doctor. The residents will also decide how to use the common space based on their own interests.
Co-housing was brought to the United States from Denmark in the 1980’s by Charles Durrett and Kathryn McCamant. There are 39 cohousing communities in California and 210 in the United States.
Phoenix Commons is being developed by the Zimmerman family from Alameda. Led by Chris Zimmerman, the family has been in the eldercare business for many years and own several facilities in Alameda. Although Phoenix Commons will be an independent living facility, it will be close to assisted living and skilled nursing facilities, if residents require that level of care.
I usually do my laundry in the morning. I put a load in the washer and move it to the dryer when it is ready. Frequently I turn the dryer on and leave for work, shopping or errands and come home to nice dry clothes. My washer and dryer are relatively new.
A few weeks ago our daughter was home for the holidays. I had just put a load of clothes into the dryer. She came in and smelled smoke. We all tried to figure out its source–it was coming from the dryer and it smelled terrible! We turned the dryer off, but the clothes still smelled like smoke.
The repairperson came last week. When he opened up the dryer, there was a lot of burned lint in the bottom. It had been on fire! There was also lint in every little nook and cranny. I am really good about cleaning out the lint filter in the machine before I add a new load, but we had not cleaned out the vent pipes for over 14 years. He also showed me the exit point for the pipe on the outside of the house—you could not feel any air coming through the pipe. It was completely clogged with lint.
We were so lucky that we had been home when the fire occurred. If it had happened when we were all away, our house could have burned down. There are over 15,000 dryer fires in the U.S. each year. I have read that dryer fires are the most prevalent cause of household fire.
Last weekend, my husband and I went to the hardware store and bought a kit for cleaning out the existing vent pipe plus new replacement piping for the interior. Our old system was long and twisted through the wall. There were lots of places for lint to collect. We replaced that with a very straight pipe that goes directly to the outside. The lint cleaning kit includes a stiff brush about the diameter of the pipe, plus long extensions so you can get the brush way up into the pipe. Some of the kits hook up to a drill. We replaced the old pipe and cleaned out the existing pipe in a couple of hours.
Our plan is to clean out our vent pipes yearly. Also, I am not going to leave clothes drying in the dryer when I leave the house anymore. I hope that all of you will consider what you should do to reduce the chance of a dryer fire in your home.
Last spring I wrote about the revised Accessory Dwelling Unit ordinance which was presented to the City Council in April. Click here to see the orginal article. I have had several phone calls and emails over the past few months from people interested in building these units in their back yards.
It is time to move on to the next step. On December 18, a group of supporters of the ordinance are speaking to the City of Berkeley Planning Commission. There are several homeowners who will either speak at the meeting or write to the Planning Commission. Please contact me if you would like to do so.
I am very excited! We are on the way to making Berkelely a national model for senior housing options.
Mark Rhoades from Rhoades Planning Group spoke yesterday at the Berkeley Association of Realtors about upcoming housing developments in downtown Berkeley. Between 1970 and 1995, 400 new housing units were added in Berkeley; between 1997 and 2013, 2,000 new units were added. In the next few years, another 1,000 will be added. About one-third of the units will be specifically for the student population on the southside of campus.
The largest of the planned projects is Berkeley Plaza, an 18 story building with retail spaces on the ground floor and 300 apartments above, six movie theatres, and below ground parking. There will also be an open central plaza. This development is planned for Harold Way, above the Shattuck Hotel and the former Hink’s Department Store.
I am very excited about the increase in housing downtown. There will be more people on the street, an increase in businesses and cultural activities. The city ‘s central core will be more vibrant and exciting.
Several of the realtors at the meeting asked “What about senior housing?” We all have clients who live in other parts of Berkeley, but would love to sell their homes and move to a downtown apartment. No more home or yard maintenance. Get rid of the car, walk to the senior center, shops and cultural events.
My vision for downtown senior housing is based on the Burbank Senior Artists Colony model which I wrote about a few months ago. Berkeley is perfect for a program like this. Downtown Berkeley would become a destination for retirees. We have the resources; we just need to make it happen.
I went to a conference on Tuesday in Cupertino—Housing, Community and Longevity: Here Comes the Age-Wave. This was the fifth annual conference organized by Chris Kennedy of the Institute for Age-Friendly Housing and the first held in Cupertino. About 100-125 seniors and those who work with them were in attendance. The mayor and entire city council of Cupertino were there. I went with three members of the Transition Network/Bay Area Senior Women’s Housing Options Group.
I came away completely energized by the conference. The two main questions were: how are cities going to provide for their growing senior populations and how can we use technology to address the needs of the rapidly growing senior population? There were several speakers from Silicon Valley where many of the innovations are being developed including the City of Los Altos which is working on its designation as an Age Friendly City by the World Health Organization.
The first speaker of the day, Richard Adler, a Distinguished Fellow of the Institute for the Future in Palo Alto got the day off to a good start with his talk about “Game Changers. “ The world has never experienced a demographic revolution like the one we are in now. In 1950, 5% of the population was over 65 and 15% under 5; in 2050, 15% of the population will be over 65 and 5% will be under 5. Those over 100 are the fastest growing part of the population.
He maintains that Silicon Valley is uniquely positioned to solve many of the problems of the elderly. The old paradigms of addressing the problems of the elderly are not going to work. What is needed is a new wave of entrepreneurial innovation in both public and private sectors. The best way to predict the future is to invent it—we need to build the world we want to grow old in.
Some of the creative new programs that are addressing the growing needs of the senior population include:
Center on Longevity at Stanford which has recently announced a design challenge to develop creative solutions to aging;
Senior Planet, a high tech showcase in New York City for seniors for “aging with attitude”
Institute for the Ages in Sarasota County, Florida, the oldest county in America which views its senior residents as assets
Annabel Pelham of the Department of Gerontology at San Francisco State University told us about her work with Los Altos in its work to be designated an age friendly city. The process takes about five years of planning and data gathering. Seniors must be leaders in the process and the political system must be supportive.
The World Health Organization identifies eight components of a city which affect the health and well-being of its senior residents:
3) Social Participation
4) Respect and Social Inclusion
5) Civic Participation and Inclusion
6) Communication and Information
7) Community Support and Health Access
8) Outdoor Space and Recreation
As many of you know, I think the East Bay is the best place to grow old in the nation, The groundwork was laid by those who worked to make Berkeley accessible to the disabled in the 1970’2 and 1980’s. New programs like Ashby Village, North Oakland Village and the many senior service programs in our communities are important contributors, but we still have a lot to do. All cities in our country need to be age-friendly.
A few weeks ago I met with Audrey Young, a fiduciary who is founder and president of Family Concierge in Montclair. She helps seniors and their families with the financial and personal needs that arise at the end of life. I learned so much that day and asked Ms. Young to prepare an article for the readers of East Bay Smart Senior. Her article is directed to ward senior service professionals, but is equally useful for seniors, their friends and families (especially when they live far away).
A Trusted Resource for Your Senior Clients
For those of you who specialize in senior real estate sales, you know that on occasion your sellers do not have close family members nearby to help with decision making or the physical work of preparing for a move. Or if they do, these family members may not have the ability or willingness to take on their parents’ personal affairs. A private professional fiduciary can help in a move situation by identifying estate liquidators, auction houses, and non-profits to sell, appraise, or donate property. These licensed professionals can also act as project managers to oversee the clean-out crews, making the staging and ultimate sale of the home much easier for the real estate team.
Why choose a fiduciary?
A private professional fiduciary is a person given the power to act on behalf of another in situations that require great trust, honesty, and loyalty. We are licensed by the state of California, held to the guidelines of the California Probate Code, and are bound by strict confidentiality agreements.
Simply put, a fiduciary acts as a family’s right-hand person to manage and/or carry out the tasks needed in handling the personal affairs of a client. By hiring a professional fiduciary, the client gains the knowledge and expertise that a friend or family member may not be able to provide.
Private professional fiduciaries also play a key role once a family member has passed. When named as an executor or trustee, a fiduciary will help a family by identifying, gathering, and securing assets, filing an Inventory and Appraisal with the court, filing estate tax returns, and distributing assets to beneficiaries.
How to make the connection
If you are working with a senior client or their family and notice that they seem overwhelmed by the idea of taking care of the move logistics (including home clean-out), or if the senior seems to be in need of more assistance with daily financial management, please refer them to a licensed fiduciary. I offer free consultations and can provide helpful resources for seniors and their families in the San Francisco Bay Area.
Many Americans are unable to make decisions for themselves in their later years. It’s estimated that 40% of Americans will have some form of dementia in their lifetime and be unable to make medical and financial decisions. The little-known but often essential role of a licensed fiduciary will likely grow in importance and public awareness as the population continues to age and seeks the services of professionals who can serve as their trusted allies.
For more information about the fiduciary profession, please visit the Professional Fiduciary Association of California website at www.pfac-pro.org. There is even a searchable database of licensed fiduciaries organized by specialty across California.
Audrey Young is the president and founder of Family Concierge, a fiduciary practice in the Montclair neighborhood of Oakland, CA. She started her business to help local and long-distance clients manage the personal and financial needs of their elderly parents and relatives who live in the Bay Area. For more information, visit famconcierge.com.
This article is intended to provide general information and should not be considered legal, tax, or financial advice. It’s always a good idea to consult a legal, tax, or financial advisor to discuss your client’s specific situation.
Many of my real estate clients are moving here from out of state and many have issues related to their trusts. My friend Sara Diamond is an elder law attorney and has just posted a new blog which can help people avoid hassles related to property held in trust in other states.
Her website has information about lots of other issues which seniors are concerned about. Check that out as well.