HOA Dues
Turnover
Pet Friendly?
Outdoor Space
Comparables
Am I Overpaying?
Impacted Views and Amount of Light
Agent Commission Rates
Using $/Square Foot
PulseFactors estimates that every incremental $100/month in HOA dues is equal to $40,000 in equity. For example, if you have two (essentially similar) units on the market, and one has HOA dues of $400/month while the other has dues of $300/month, the first unit should sell for $40,000 less than the second. Log In to Add to MyPulse Page
In a large building (between 100 to 400 units), the annual turnover, i.e. annual unit sales, will be about 6-10%. This means that for a 300-unit building, in a given year you will have 18 to 30 units come onto market, or 1.5 to 2.5 units per month. When you go to sell, you may be competing with multiple units on the market at the same time. Log In to Add to MyPulse Page
One of the advantages of recently built condominium buildings is that their CC&Rs typically allow pets. There is generally a restriction as to number and size, as well as a prohibition against breeding. Log In to Add to MyPulse Page
The value you place on a deeded balcony or terrace should be minimal, according to PulseFactors.com´s analysis of thousands of resales. Log In to Add to MyPulse Page
When you are buying or selling, use the price of comparable units in a building as a benchmark and not a hard fact. Though Unit A may have sold for $750,000 three months ago, and may be directly comparable to Unit B, this comparison is not all that important. What is more important is the list price of comparable units in all properties currently on the market. These units are your real competition. Log In to Add to MyPulse Page
Let's assume that in order to buy the condominium you really want, you have to face down competitors. You plan to pay $800,000, although the unit you want is on the market for $750,000. Are you overpaying? Create a spreadsheet going out 10 years. Under year one, put $750,000, the theoretical value (list price) of the property. Now create three lines: a compound growth rate of 2.5%, 5.0% and 7.5% — or any other range you want. You will then see how many years it will take to break "even," i.e. reach the $800,000 level you agreed to pay. By the way, the average annual appreciation of San Francisco condominiums over the last 20 years has been 7.3%. Log In to Add to MyPulse Page
Before you buy in SOMA, have your agent thoroughly investigate whether the present view and/or the amount of light you expect to enjoy will be impacted in the future by a new building. Though there are no guarantees, good research may turn up some unknowns. Log In to Add to MyPulse Page
Sellers pay the whole commission and the buyer enjoys the ride. When you go to sell, assuming that you pick a good agent, don't haggle over his or her commission. The range is probably 4- 6%. Venture Capitalists have a saying: "you pay peanuts, you get monkeys." Wouldn't you rather pay 6% and have your property sell for $1 million (netting you $940,000) than pay 4% and have your property sell for only $950,000 (netting you $912,000)? The better agents usually have higher commissions, but they also get the higher prices. Log In to Add to MyPulse Page
It is probably a waste of time to use this metric. The view, floor level and finishes combine to depreciate this metric when analyzing a purchase. While this figure is useful for developers, it is probably worthless for buyers, who rarely if ever decide on a purchase based on this measurement. Log In to Add to MyPulse Page
