Sold statistics of single-family detached homes for Alamo California for all years beginning with 2000 to and including August 2009 is as follows:

			Median	Average	Median	Median
	2009	#	Sales Price	Sales Price	Sq. Ft	Pr/SqFt
	Jan	10	$1,357,500	$1,737,700	3,603	432
	Feb	6	$1,240,000	$1,177,000	3,728	365
	Mar	5	$1,125,000	$1,581,250	3,708	367
	Apr	7	$1,015,000	$1,174,571	2,484	424
	May	6	$902,000	$979,833	2,350	381
	Jun	14	$1,255,000	$1,345,892	3,285	442
	Jul	9	$1,225,000	$1,402,777	3,111	378
	Aug	16	$1,008,837	$1,161,404	2,938	374
	To Date	73	$1,200,000	$1,320,253	3,302	378
	2008	118	$1,354,725	$1,551,877	3,209	472
	2007	171	$1,442,500	$1,687,335	3,066	506
	2006	158	$1,570,000	$1,710,182	3,112	500
	2005	221	$1,480,000	$1,621,208	3,130	486
	2004	299	$1,255,500	$1,399,972	3,100	408
	2003	249	$1,190,000	$1,285,378	3,400	368
	2002	268	$1,000,000	$1,110,638	2,927	361
	2001	170	$950,000	$1,102,431	3,161	321
	2000	200	$925,000	$1,086,167	3,052	314

Oh, please! Not Another Death To Car Leasing Article! 

             It always amazes me how some people think that leasing a car is only for financial fools - that the only real way to acquire a car is to buy it and finance it. Michelle Singletary's recent writing on Tuesday, August 12 is just another one of those diatribes on leasing where the writer obviously has no real understanding of the subject matter. Michelle writes that she has been trying for years to get people to see the financial folly in leasing a vehicle. If I had Michelle here with me now, I would tell her that she is absolutely wrong when she says that the residual value in a lease "is the amount you need to buy the car at the end of the lease". No Michelle. You don't have to buy the car at the end of the lease. You would only buy it if the value of the vehicle is equal to or higher than that residual amount. If it's not, the lessee - the person who acquired the car - does NOT have to buy it. You see that's the point. When you lease a car, you are placing the residual risk on the lender. And, if the lenders are now taking losses (which you correctly state), that's better than the car buyer taking the loss. Who's the fool? Besides, who better to subsidize the low resale values and low demand for those vehicles than the original manufacturer?

            There are several things you need to look at when you're considering leasing vs. purchase financing. With the lease, there's something called a "money factor".  That is essentially the rate that the lender is charging. Unfortunately, the lender doesn't tell you how to interpret that rate. But, I'm about to tell you. When a lender charges you a money factor of .003, for example, they are actually charging a rate of 7.2%. You would simply take the money factor and multiply by 24. In leasing, the lender doesn't have to tell you the rate. They have to tell you the money factor. Most people don't have a clue what it means. Now you do.

            Look, leasing and purchase financing is all the same. They are both forms of financing. What you have to determine is how to compare them and whether one suits you more than the other based on the rates, residual and other terms available for each form of financing. If you don't compare, you may be losing out.  There are times when purchase financing is clearly the better option and there are times where leasing is better. There are other matters to consider when comparing including the maximum miles allowed per year, as well as acquisition fees and/or security deposits associated with the lease. One positive about the lease is the fact that you don't pay sales tax on the entire cost of the vehicle upfront. You pay sales tax on the portion of capital cost reduction you pay upfront, on the rent you pay every month and on the full residual only if you buy it. If you don't buy out the residual, you don't pay that sales tax. You just give the car back subject to mileage and condition issues. That actually can be a big savings for someone who likes to buy cars and sell them in 3 years or so.

            In recent years, the lending affiliates of auto manufacturers have been providing sub-vented money factors and high residuals on cars such as BMWs. Those money factors are often considerably lower than the .003 mentioned above and sometimes as low as .001 to .002. I've seen even lower factors on occasion. Now, if the lenders are going to give me a financing rate that is lower than the rate I can get in the market and they are going to take a risk on an inordinately high residual on the vehicle that you and I as car buyers don't want to take, what's wrong with taking that money? Let me say this differently, Michelle. If I were selling you my home and I said to you that I would give you a low rate - lower than you can get from a typical mortgage lender - and I also told you that I would give you a guaranteed buyback of the home should the value fall below a certain level in a few years when you want to move or otherwise get out of it, why in the world wouldn't you think that could be a good deal and worth further analysis?  Would you be living above your means, as you suggest? No. In the case of cars, you would be taking advantage of the lenders gracious hospitality and its need to move cars off their lots. If I am able to drive a BMW for the same price as a driving a Buick, I am not living beyond my means. I am getting the best value for the buck. And, if that makes me look richer because I get to drive a nicer vehicle, so be it.

            I have a basic philosophy that I would like to share with you. That is, as a general rule, you should buy things that go up or at least maintains it value over the course of its use period and you should lease things that depreciate in value. Cars are not investments. They are an expense. Any dealer who tells you that a car is an investment is saying that with tongue in cheek and is trying to see if you flinch. Building equity in something that goes down in value - and rather rapidly I must admit - is simply the worst thing one can do financially. There is one simple truth about leasing. Generally speaking, it costs less to get in it and it costs less every month. Now if you are one of those who like the idea of paying more upfront and throughout the use period - sort of like a savings account - so that you can say you own your vehicle and thereby build up equity in a depreciating asset, then perhaps, buying is a better alternative for you. But for me, unless and until the lenders make leasing of vehicles more expensive by placing low residual values on the vehicles and/or make the money factors too high in comparison to purchase financing, then leasing has a place in my heart and in my pocketbook.

            Michelle, with all due respect, you are simply all wet and you should stick to writing about a subject you are familiar with. Simply, car buyers have different objectives and the leasing vs. purchase financing situation can be enormously different depending on the vehicle and the moment in time. In my opinion, each situation deserves to consider the benefits of leasing vs. purchase financing on a case by case basis. There have been many writers like Michelle who have been singing the praises of the coming of the death of car leasing, but I think there are too many smart people around to have these writings deter them from making the best financial move for their particular situation.

 By Gary C

   Sales of homes in the San Francisco East Bay Area (including condos and townhomes) during the first six months of 2008 compared to the same period during 2007 vary by town/city.  A chart of such activity is as follows:

			2007				2008				Up/Down
		# Units	Avg	Median		# Units	Avg	Median		# Units	Avg	Median
	Alamo	92	$1,667,784	$1,435,000		55	$1,435,008	$1,385,000		-40.22%	-13.96%	-3.48%
	Danville	354	$1,015,326	$932,500		208	$946,723	$879,500		-41.24%	-6.76%	-5.68%
	San Ramon	531	$809,551	$760,000		337	$748,526	$710,000		-36.53%	-7.54%	-6.58%
	Dublin	298	$687,277	$608,750		199	$557,273	$512,225		-33.22%	-18.92%	-15.86%
	Pleasanton	458	$915,227	$769,000		254	$932,421	$750,000		-44.54%	1.88%	-2.47%
	Walnut Creek	457	$754,088	$722,500		282	$707,510	$660,000		-38.29%	-6.18%	-8.65%
	Pleasant Hill	179	$644,702	$625,000		122	$519,688	$513,500		-31.84%	-19.39%	-17.84%
	Lafayette	173	$1,245,120	$1,050,000		107	$1,259,192	$1,140,000		-38.15%	1.13%	8.57%
	Orinda	101	$1,272,173	$1,200,000		74	$1,321,166	$1,212,500		-26.73%	3.85%	1.04%
	Moraga	78	$919,290	$928,750		71	$854,872	$886,750		-8.97%	-7.01%	-4.52%

As you can see from the above chart, the Lamorinda towns of Lafayette, Orinda and Moraga as well as the Pleasanton area experienced low price drop or slight increases over the same six months compared to the previous year. Keep in mind that this only compares the sales over the same 6-month period of 2008 and 2007 and does not consider what has taken place since the highs of 2005.

With all the real estate short sales occurring in recent months, there was a big hole in the tax law that penalized homeowners who wish to work with their lenders to sell the homes that contain some loan forgiveness by making them take the amount of forgiveness as debt discharge income. Now, President Bush has signed into law a bill which states that a taxpayer no longer has to pay income tax related to forgiveness of loans secured by a principal residence. This new tax law, called the Mortgage Foregiveness Debt Relief Act of 2007, applies to debts discharged between January 1, 2007 and December 31, 2009 and applies to debt incurred in acquiring, constructing, or substantially improving the primary residence up to $2 million of refinances. Instead, a taxpayer must now subtract the amount of the discharged debt from the basis of the property for purposes of calculating the capital gains of such principal residence.

For a copy of this new law, click here.

   Have you ever attended a foreclosure auction at your county courthouse steps? Well, you have to do it at least once. I've actually done it many times. Companies are hired by lenders to conduct trust sales on homes being foreclosed and those companies conduct those auction sales on courthouse steps, rain or shine.  You would just look up the log of homes up for sale on any given day and then you just go. Anyone can attend but to participate in the bidding, you would have to have cash (or better yet, bank checks) to immediately pay for the property being auctioned. As a matter of fact, you can't even participate in the bidding unless you first show the auctioneer the amount you have so he notes how high in the bidding you can go. Actually what you do is go to your bank and have them issue several bank checks in different denominations so that if you "win" a bid, you don't have to overpay by much. The auction company sends you back the amount of overage after a week or more. Please note that all sales are final. You make payment on the spot and you become the proud owner of the property. It's an amazing process. 

   I should caution those of you who think that you will get a buy all of the time. First, you must assume that the home is in foreclosure because the trustor/owner has not had the money to make payments on the loan over some elongated period of time. Secondly, the home has probably been on the market for some time and has not sold. You can also assume that the house may not have been maintained to what you are accustomed to seeing.  Lastly, I must mention that someone - not necessarily the owner - has been living in the home and may not be that easy to evict. All of these point to the fact that it may take some doing to get actual possession of the property and when you do get possession, you will have to put money into the home to get it marketable. Also, make sure that when you bid, you will obtain free and clear title. In California, they tell you nothing at the auction. You will need to know what the sale is for by doing your own investigation. You can go to the county for records before going to the auction. I have one interesting story to tell about this. There we were on the courthouse steps and bidding is light on a particular property being auctioned. One individual decides to go for it and makes a bid and wonders why no one is out bidding him. Lo and behold he comes to learn that he has just bought out the second loan - not the first and finds out that the second is under water compared to the value of the home. Ouch!

   Look! These auctions are attended by people who represent syndicates or teams of people consisting of a real estate broker, contractor, subcontractors, the investors, lawyers, lien investigators and, of course, the bidding member. You have to assume that these people know something about this property if they are going to bid because their job is to make money. If they aren't bidding, there's probably a reason. And, if you don't know what you are buying, don't bid.

   If you wish to know anything about how to go about attending and bidding in these auctions, you can contact me.

   I recently saw a little promo ditty - from Princess Cruises of all places - that of all the couples currently married, 81% have been married for at least 5 years, 53% for at least 15 years, 33% for at least 25 years, and 6% have celebrated their 50th wedding anniversary.

   Did you know that Mt. Diablo was volcanic rock beneath the surface of the Pacific Ocean some 165 million years ago? It wasn't until some 2 million years ago that the peaks became exposed as low lying hills.

   A reprint of the Fall 2000 edition of Mount Diablo Review is available as interesting reading on the history of Mt. Diablo including early human and more recent Indian habitation. Check it out - click here to see that reprint.

   There is a very good alternative to installing granite in your newly updated kitchen - and that's engineered quartz. Click here to see an interesting article on this topic.

   As of the end of 2006, there are over 521,000 real estate licensees (of which approximately 141,800 are brokers) in the State of California and that number is going up at a pace of 4,000 per month.  So, that means that of the over 37,172,000 people in California, one out of every 71 people in California has a real estate license - over 1.4% of the population. To see these stats, just click here.

   Just think of it. You go to see a baseball game at AT&T Park in San Francisco where 43,000 people attend and you will be with over 600 real estate licensees. Good thought, huh?

   My friends at The Harper Team recently noted that the people at My Tech Opinion.com provide the steps you would take in mapping multiple locations on Google Maps.  To read that article from My Tech Opinions, click here.  This could be a great tool to see homes on broker tours and mapping several homes when showing to your buyer clients.