Intero Prestigio International Magazine | A Luxury Real Estate Collection – Issue 23

A luxury collection from Intero Real Estate Services of the finest and most exclusive homes. Here at Intero, we’re always working to stay ahead of the curve and offer the best service possible to today’s homeowners. The Prestigio International system provides an elevated level of service through its elite selection of marketing tools set up to expose your home to relevant markets locally, nationally and globally. From the sign that goes in front of the house, to the online advertising of your home, you can be assured, Intero Prestigio International will showcase the best attributes your home has to offer to get it sold quickly and efficiently.

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Intero Prestigio International Magazine | A Luxury Real Estate Collection – Issue 20a

A luxury collection from Intero Real Estate Services of the finest and most exclusive homes. Here at Intero, we’re always working to stay ahead of the curve and offer the best service possible to today’s homeowners. The Prestigio International system provides an elevated level of service through its elite selection of marketing tools set up to expose your home to relevant markets locally, nationally and globally. From the sign that goes in front of the house, to the online advertising of your home, you can be assured, Intero Prestigio International will showcase the best attributes your home has to offer to get it sold quickly and efficiently.

Sellers, Make My Day…And Yours!

by Alain Pinel
General Manager of Intero Prestigio international

Luxury homes stay longer on the market than less pricey homes. Surprised, Anyone? Of course not, it takes money to buy real estate and a heck of a lot of it to buy million-dollar properties. More than half of the buyers can afford an average-priced home most anywhere in the US, but way less than 10% can buy their million dollar dream home.

The problem is not whether or not the sticker-price is relevant, as it can usually be justified based on comparable sales or active listings. The problem is simply that qualified buyers are not legion at the top end of the market. Today, in some of the most exclusive zip codes from one coast to the next, you may have 10,000 homes for sale over $3M with “only” 9,000 possible buyers looking in that price range. Over $10M, you may have 1,000 properties fighting over 800 buyers.

With the prospect of better tomorrows, million dollars homes have been mushrooming all over the land a lot faster than the number of millionaires. At that price level, the demand can only buy a fraction of the supply. Lowering the price is not necessarily the recipe to capture a buyer since, as stated earlier, the price, most of the time, is right on target. We are in a catch 22 dilemma. Only time and effective targeted marketing to connect with the right buyers can help.

Talking about targeted marketing, it is pretty obvious that the pool of luxury buyers is very different today from what it was only 10 years ago. The qualified and interested domestic demand is substantially down as a fraction of the entire demand. The segment which is up and continues climbing is the demand from foreigners originating from Asia, Europe and the Middle East, etc. Thanks to this game changer, the luxury market is remaining active if not steamy, and promises to keep on growing.

As I wrote here a couple of times, the huge appetite that Chinese buyers alone have for US real estate, especially the crown jewels, is the best insurance policy that guarantees a high level of transactions, a robust volume of sales and a growing average price. Last year, the Chinese bought something like $30B worth of real estate here. The US is their N.1 destination, well ahead of Australia, the U.K. and the rest of the world.

The buying frenzy is not likely to slow anytime soon. More and more wealthy Chinese come over as tourists to check the territory with the idea of emigrating someday. Last year alone, about 100 million of them travelled abroad and, here again, the US was top of list.

The supply of high-end properties, as stated earlier, is abundant today, most everywhere in the country. However, not all listings respond to the needs & wants of today’s buyers. They want it all: location, quality, style, size, etc. They know what they are looking for and, given time and a good Realtor, they will find it.

In the Silicon Valley, the land where the word ‘impossible’ does not exist, the supply inventory of relevant homes for sale is barely more than a month. That’s what you call a hot market. But, believe it or not, in spite of it, a massive number of would-be sellers are still waiting for better times to sell. Puzzling. What do they know that I don’t?

I suppose many sellers are waiting for the traditional Silicon Valley IPO bonanza. Well, it’s here, but not quite as juicy as sellers & buyers are hoping for it seems like. Startups are being created in waves but not developing in the valley as much as in the past, during the heydays of the late 90’s. Having said that, I am not the least worried about the future growth of the luxury market in Silicon Valley or elsewhere. The big Mo is here to stay at the top end.

Stunning Luxury Real Estate

What do you get when you combine the innovative, tech savvy power of Intero with our high-end real estate division, Intero Prestigio International? Nothing other than a virtual magazine featuring its multi-million dollar properties.

I present to you today our latest edition of the Intero Prestigio Virtual Magazine.  Please click on the image below and browse through over 70 pages of content, with oversized photos and detailed information describing some of Intero’s most extraordinary luxury properties.

The Prestigio International system provides an elevated level of unique service for luxury listings through its elite selection of marketing tools set up to expose your home to relevant markets locally, nationally and globally and is an exclusive program for Intero Real Estate clientele.

Enjoy!  And if you feel inclined, please share with your friends and family too.

Homeownership & Wealth: The Dynamic Duo

by Alain Pinel

General Manager of Intero Prestigio international

Is homeownership getting out of fashion? Scary thought! Ridiculous actually! Why such a daring and provocative question then? Well, if you believe in stats, you have to be concerned that the rate of homeownership has been dipping of late.

In 2004, the rate reached its peak at 70%. Today, it stands at 64.3%; it’s as low as it has been for the last 20 years. The reason? I bet you already figured out what it is, at least part of it….. Smack in the middle of the 2004 to 2015 stretch, we have been shaken up by the many tremors of a 4 year long financial crisis, the Great Recession to call it by its name.

The New York Times, in its SundayReview, wrote an editorial on the subject matter, partially using the findings of a research by the Joint Center for Housing Studies at Harvard University.  One sentence gives the full flavor of the article: “Since the housing bust, renting has been in and owning a home has been out.”

The declining ownership rate, mentioned above, proves the point. During the period of time when the rate shrunk to the extent of 8%, the number of homes occupied by tenants increased by about 25%.

Some observers may wonder whether this situation can be explained by the economic slowdown, with what it means in terms of jobs & incomes compression, or if it represents more of a trend, a lifestyle change of sort. Is homeownership losing its appeal?

The article is reassuring. Homeownership is as American as apple pie. It has been and still is, as much as ever, central to our ability to amass wealth. Between buying and renting, there is no competition. Even with the substantial decline in wealth due to the housing bust, says the NYT, the net worth of homeowners over time has significantly outpaced that of renters, a group which tends to accumulate little if any wealth.

When analyzing the reasons for the above, the Joint Center for Housing Studies makes the key point that homeownership requires buyers to save money for the down payment, and requires them to keep on saving to pay down the loan balance together with interest.

The alternative, renting a home, not only does not build equity, but does not require the tenants to save any money at all. They can if they are able & willing, but, at the end of the day, most don’t, because they don’t have to.

Of course we cannot downplay the risks involved in purchasing real estate. Prices can go up (as they have in a big way during the last three years or so), but they can also go down, shrinking equity or wiping it off altogether. Does not happen often and does not last long, but it sure hurts when it happens, as it did during the housing bust.

Frankly, I don’t know many people who wish they had rented a home rather than buy one. When in doubt, think about what you paid for the house you live in and what you could sell it for today. You can do the same exercise with all previous homes you bought and sold over the years. Great education to make believers out of the skeptics among us.

Bottom line: unless you are looking to stay in any given place a very short time (between two homes so to speak), there is no good reason to rent rather than buy, create wealth in so doing, and live the American dream.

La Vid Sonoma

A luxury collection from Intero Real Estate Services of the finest and most exclusive homes. Here at Intero, we’re always working to stay ahead of the curve and offer the best service possible to today’s homeowners. The Prestigio International system provides an elevated level of service through its elite selection of marketing tools set up to expose your home to relevant markets locally, nationally and globally. From the sign that goes in front of the house, to the online advertising of your home, you can be assured, Intero Prestigio International will showcase the best attributes your home has to offer to get it sold quickly and efficiently.

Issue #16 of Prestigio International magazine is OUT!  With more than 70 pages of luxury homes to enjoy, this is our biggest issue yet!

Ask Bay Area real estate agent Kristen Jurevich how you can own one of Intero’s properties or how Kristen can help sell your home.

What Bubble?

By Alain Pinel
General Manager of Intero Prestigio international
Intero Real Estate Services, Inc.


Are we spoiled, or are we bored, or are we blind? Is the Silicon Valley the eternal land of plenty or just a Fools’ Paradise?

I don’t know about you but I feel like I caught a virus that makes me a bit gloomy these days. No matter what business paper I read, I feel like being brainwashed about new impending dotcom slide. The word “bubble” is coming back in fashion. Every decent brain has a theory on the matter and they are ruining my days preaching tougher times in the tech industry and whatever business (like real estate) that benefits from it.

What are we talking about? The hi-tech euphoria which caused some IPO’s to reach stratospheric levels over the last two years, is dissipating. Valuations are being challenged, especially in the social media arena and biotech. Balance sheets do not support stocks performance. By the time employees of most new tech IPO’s can sell their shares, the median value shrinks substantially. The tech-heavy Nasdaq is down so far this year. Warning signs?

Anything can happen. I have not forgotten the tech boom of the 90’s in the Silicon Valley and the brutal wake-up call that followed in late 2000 & 2001. But what I see from my window, today, is that too many people believe way too much in Murphy’s Law. It is a good conversation topic around a dining table to predict a slowdown, just like we predict the next big quake can happen anytime, but the fact is that today’s “bubble” has no similarity to that of 2001.

Back in those days, the giants of the industry were still young and financially unsecure. Their market was, for the most part, limited to the country boundaries. IPO’s were mushrooming right & left, fueled by plenty of VC money looking for a quick return.

Today, the giants of the tech sector are loaded with cash. They are doing as well if not better overseas. They are grabbing new innovative tech companies at record prices without feeling any pain. Investors are in for the long term. VC people are hot about growth revenues prospects and are investing billions in the Valley, particularly in San Francisco, which appears to be the new destination. The returns sure beat other investment opportunities in this anemic economy.

Of course those same people complaining about overvalued tech stocks about to fizzle, are announcing the same prospect for the local real estate activity which depends so much on the tech sector in the Silicon Valley. The market, however, is behaving just fine. The only negative is that the so-called Spring market has not, so far, brought the thousands of new listings that we expected and we so badly need to satisfy a steady demand.

Most of the uncertainty regarding the regional residential market is not related to a tech slowdown; it is just a new normal here and everywhere else in the US given a sluggish economic recovery. NAR, the National Association of Realtors, was remarking a couple of weeks ago on the fact that the current sales activity in underperforming by historical standards. “In contrast, price growth is rising faster than historical norms because on inventory shortages.”

Last year, the Silicon Valley has fared quite well compared to most other areas. In the “money-towns” of the Mid-Peninsula, such as Atherton, Woodside, Portola Valley, Menlo Park, Los Altos, Los Altos Hills & Palo Alto, the dollar volume of sales exploded year over year, up to 28% in Woodside and 22% in Palo Alto. Unit sales also jumped to new highs, except in Menlo Park, Los Altos & Palo Alto where the inventory of active listings was particularly low.

When you compute the price appreciation over a 5 year period, homeowners did pretty well: Atherton jumped 28%, Woodside 29%, Portola Valley 38%, same for Menlo Park and Los Altos, Los Altos Hills 15%, and Palo Alto…57%! Is that enough to talk about a bubble? Not in my book since it is mostly a function of the dichotomy between supply & demand. Yes, 2014, so far, has been a bit weak, but you give me a lot more listings and I’ll give you a lot more sales without inflationary prices. The Silicon Valley is OK. Keep the faith. Thank you.