Geek's Number Talk: ADUs raise property values

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According to a new analysis by Porch.com, ADUs are becoming a trendy response to the housing affordability crisis in California and the Bay Area. As of 2019, there were 1.4 million homes with an ADU nationwide, and that number is growing by 100,000 per year.

One reason for the rise is the impact that ADUs have on property values. Across America’s largest cities, homes with ADUs averaged 35% higher prices than those without. But with the average cost of an ADU in the range of $180,000 — and as much as $400,000 in the Bay Area — it may not make dollars and sense for you.

Learn more from the National Association of Realtors and contact us for a consultation.

Chic vs. Geek: Thinking of adding an ADU?

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Accessory dwelling units, aka ADUs, come in a variety of shapes and sizes, but adding one to your property may not be the right fit. It’s important to know the ins and outs and plan ahead. We’re here to help!

CHIC (PEARL)

ADUs can provide housing for aging family members, an affordable option for teachers and others in the “missing middle,” and a reliable source of additional income for you and your household. As we experience a boon in the ADU market thanks to loosened regulations, there’s a variety of vendors out there. It can be hard to know where to start. I recommend you figure out what kind of ADU you need first. Function should come before form in this case, given the investment of time and resources you’re about to make.

GEEK (KEVIN)

The key to adding an ADU on your property is making sure the project pencils out. That means keeping costs down without sacrificing a quality product that will stand the test of time. You can find a lot of savings on the front end of the process when choosing an architect, designer, and/or builder. Doing a little research to find vendors with strong track records will pay dividends later when you get the project done right the first time. The best contractors also know their way around local government permits!

SummerFest returns to Downtown San José!

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One of the most exciting, diverse, and popular music festivals in the country kicks off today in Downtown San José. If you’re craving a heavy dose of live music in a variety of styles, delicious food from around the world, and a fun time outdoors, San José Jazz SummerFest is the place for you to be this weekend!

Learn more and get tickets here.

Geek's Number Talk: The Impacts of Rising Mortgage Rates.

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It should come as no surprise that rising mortgage interest rates have a direct impact on home buyers and sellers. These two charts help make those impacts crystal clear, especially when it comes to purchasing power, inventory, and selling price. As you can see, an interest rate increase of just 0.5% triggers a 4.4% increase in home price but also a 4% decrease in active listings.

Meanwhile, the median house price is down 4.7% month-over-month but still up 4.5% over last year. This means home affordability is tracking down, so the time to act is now, or you risk waiting out the current economic fluctuations.