Learn why a knowledgeable agent pricing recommendations are your best bet.
Today’s buyers and sellers have come to rely on platforms like Zillow and Redfin to determine quantifiable, data-driven property value estimates. Whether you are a buyer or selling a property, assuming that these price estimates are accurate and objective assessments can be a costly error. (Learn more about how Zillow calculates estimates, “Zestimates,” and their limitations below).
The Bottom Line
Homeowners should use Zestimates as a benchmark to contrast with other sources for a general sense of a home’s value. A Zestimate should not be considered an appraisal. In fact, a comparable market analysis from a local real estate agent and a professional appraisal of the home are the best ways to learn its value.
For most major markets, the Zestimate for on-market homes is within 10% of the final sale price more than 95% of the time. The nationwide median error rate for the Zestimate for on-market homes is 1.9%, while the Zestimate for off-market homes has a median error rate of 6.9%. Within 10% error of the price in Marin County can translate to $600K on a $6M home – that’s no small variance!
In fact, Zillow’s online pricing estimates are so unreliable, even Zillow doesn’t trust its Zestimates! Since 2018, Zillow has been using on its own Zestimates for iBuying (i.e. instant buying) homes and flipping them to make a profit. Starting in November 2021, Zillow announced it would write-off $500+ million in losses and shut down its iBuying business. The reason? They admitted their Zestimates were unreliable.
Real Estate Pricing Is Complex
According to Columbia Business School Professor and National Bureau of Economic Research member Tomasz Piskorski, Zillow’s algorithm works best with cookie-cutter homes. Piskorsk explains, “There are a lot of things that affect the valuation of homes that even very sophisticated algorithms cannot catch.”
Think you should be getting more because of the Zillow estimate you see online?
In one case, a seller’s condo sat on the market with only a couple of low offers. He noticed that Zillow’s estimate was higher than his listing price. The owner felt like his beautifully decorated home with a spectacular view was being undervalued. Afterall, all of his friends who he frequently entertained agreed with him. Using algorithm data, he wanted to pull it off the market with a plan to put it back on at a higher listing price. Rationally, in that scenario, a more objective conclusion would be that his property was actually priced too high. Possibly the algorithm didn’t distinguish between his condo and single family homes in the area and overpriced it. At a deep level, the owner felt like his condo is worth more because it’s his. Psychologists call this the “endowment effect.” It is the phenomenon where you overvalue things you own, simply because those things are yours. You’ve lived in it. You’ve painted it. You’ve repaired it. You’ve made memories in it. At a deep level, that house is worth more because that house is yours.
The combination of unreliable Zillow estimates with the psychological “endowment effect,” can lead homeowners to make some costly, unwise decisions.
How Zillow Calculates Estimates and Limitations:
What is a Zestimate?
A Zestimate® (i.e. Zillow® estimate) is a key feature offered by Zillow, a popular online real estate marketplace. It’s also the name of its home valuation model that lets consumers obtain Zestimates. Zestimate includes information from the multiple listing service (MLS) database, user-submitted details, market trends, and specific facts on homes in its proprietary formula that produces its estimates (see notes below on how Zestimates are calculated).
How Is a Zestimate (Zillow Estimate) Calculated?
According to Zillow, it “uses a sophisticated neural network-based model that incorporates data from county and tax assessor records and direct feeds from hundreds of multiple listing services and brokerages.”
Zestimate factors in:
- Home square footage, location, the number of bathrooms, and other details.
- Active listing information like listing price, description, comparable homes in the area, days on the market
- Off-market data such as tax assessments and prior sales
- Market trends and figures for seasonal demand
Why Zillow and Redfin’s pricing estimates can be very off:
- Incomplete Property Data – Algorithms do not see each home in person; Zestimates may not reflect mistakes in property taxes paid, exceptions to tax assessments or improvements; they won’t take into account the kitchen remodeled by a savvy homeowner without a permit to avoid higher tax assessments
- Lags in Data Updates – Zillow is very slow in updating the final sales price of a home after it goes pending; Both Zillow and Redfin’s algorithms can’t update quickly enough in a rapidly declining or rising market or sense local trends
- Turnover Rate – Zestimate accounts for turnover rate so Zestimates in areas where people keep their homes for longer periods of time may not be as accurate
- Bias – Zillow and Redfin have entered into the business of buying and selling homes (iBuying aka instant buying) so they are now a competitor in purchasing homes and have an incentive towards providing lower estimates in markets they invest in order to make more marking up their investments when they flip remodeled homes
Wired – “Why Zillow Couldn’t Make Algorithmic House Pricing Work”
Financial Samurai – “Use Bad Pricing Estimates By Zillow And Redfin To Your Advantage”
Investopedia – “Zillow Estimates – They’re not as accurate as you may think”
“The Endowment Effect: Why ownership makes you overvalue your things”
Boulevard Real Estate was founded by fourth-generation Marin native Elizabeth “Bitsa” Freeman. Bitsa’s expertise in the local market, reputation for genuineness, honesty and deep community connections have made her a much sought after luxury Marin County agent. Bitsa is consistently a top-producer in Kentfield and Kent Woodlands. Boulevard is proud to be certified as a Green Business by the California Green Business Network, and awarded Marin IJ Readers Choice Best Realtor Honor for four years running- 2019, 2020, 2021, 2022.
In a frenetic market with houses going for well over list and multiple offers, some sellers may question the importance of investing in staging. As a real estate professional, I can’t promise my clients that their property will stand out and receive the highest offers unless buyers fall in love with the home. That’s where staging makes a big difference. I sat down with professional stager Margot Oven of MO Design, to get her advice and opinions on home staging.
Q: (Bitsa) At a minimum what do you recommend every buyer should do if funds are limited?
A: (Margot) I recommend investing in full staging in almost every situation. Partial staging (using an owner’s own furnishings) is not worth it. Since the biggest chunk of staging cost is the stager’s time, it is almost as expensive and there is not as big of a bang for your buck. It can take as long if not longer to partially stage. With lived-in furniture and clothes in the closet, it is not as easy to create a depersonalized space that the buyers can visualize as their own. The process of staging a vacant home from scratch can be difficult. It requires packing up, moving out, finding somewhere to go and storing furniture. However, this is really worth the effort and makes it easier to attract buyers (realtors prefer it too). Today’s buyers are the HGTV generation. They watch all the home shows that prepare, prep and flip properties. They are accustomed to the look they see on TV and respond well to homes that reflect this ideal. I identify a target buyer for each property while being inclusive and tell a story incorporating details. It is designed to be warm and inviting without buyers feeling like they are invading someone else’s space. The target depends upon the individual home. For example, a family house may be staged to appeal to young families. To attract the many young couples moving from the city to a first home, I would incorporate sophisticated furnishings and stage one bedroom as a baby nursery. If it’s a non kid-friendly condo, I wouldn’t stage a nursery. Instead I might stage his and her offices and/or a guest bedroom. I also match the style of the house. A buyer of a Victorian home would not want a modern glass aesthetic. In my opinion the most essential investments, in order of importance are:
- Full staging
- Painting the walls
- Updating flooring
- Updating light fixtures
- Curb appeal landscaping
Q: (Bitsa) What is the biggest return on investment (ROI) if funds are available?
A: (Margot) Full staging offers the highest ROI in almost every scenario. After that, incorporating property improvement into staging can offer a very large return on investment for higher price point homes. This is the biggest change that I have seen in this field over the past few years. Along with staging furnishings, projects traditionally included cosmetic updates (i.e. painting the interior and/or exterior, landscaping, re-carpeting and changing flooring and updates to light fixtures). Now, prior to staging, I am often managing kitchen and bathroom remodels and other major home renovation projects. Currently there is almost no cap to how high these showcase type homes can sell. While these costly upgrades are rewarded in high end neighborhoods like Kent Woodlands, they are not for every home. The ceiling for how high a house will sell for is dependent upon the unique features of the specific property. For example, I would not recommend costly renovations for a hillside house on a busy street in Mill Valley. For lower price points homes, it would be challenging to get a return on large home improvement investments.
Q: (Bitsa) Do you ever recommend NOT staging?
A: (Margot) No. It might possibly be ill-advised if the house is a tear-down. But it can be hard to decipher whether or not staging a tear-down would still be worth the investment. I can put lipstick on a house in almost any condition and have it pay off. The other scenario where it might not be worthwhile is for an off-market listing that is being sold for the property, not the structure. But it is very rare that staging is not a sure-bet investment for the home seller to maximize their profit.
Q: (Bitsa) Have you ever staged/remodeled and the home doesn’t sell?
A: (Margot) This would be rare. If it doesn’t sell, it’s been priced incorrectly too high. Pricing is determined by the realtor. As a stager, I don’t have any control over that. I have had several instances in which the owner doesn’t want to sell after they see their transformed home.
Q: (Bitsa) Does a seller always leave money on the table when they don’t stage?
A: (Margot) Yes. “Staging” is a broad title. Staging can be narrowly defined as showing how a house can be furnished. As an interior designer, the service I provide is creating an elevated design aesthetic that will create an emotional attachment. There has been a recent shift as people scroll sites like houzz, Instagram, and Pinterest for the latest trends in home design and furnishing. Younger millennial buyers want to walk into the turn-key dream home that resembles what they see online. So I really have to stay up to date by constantly turning over my furniture. With current, curated interior design and furnishings, I present millennial buyers with homes transformed into what they are looking for. I can even disguise non-descript tract houses, giving a mediocre home the illusion of personality. For beautiful houses, full staging highlights the unique home features with updated newer, brighter styling. Over the past 3-4 years, I almost never recommend partial staging (using an owner’s furnishings and artwork) for Marin home sellers. This would only be in the rare instance when a home in the over $7MM price category has recently been remodeled and/or decorated by a high end decorator.
Q: (Bitsa) How important do you think the outside of a property is to the success of a sale in Marin, equal to or less than the interiors?
A: (Margot) The outside is less important. Home buyers can see past the exterior if they love the interior.
Q: (Bitsa) What’s the average amount of time required for a home to be prepped using your services?
A: (Margot) Staging decor itself takes only 1 ½ to 2 days. As I mentioned, my business has grown to include project management for cosmetic updates and often more extensive home improvement projects. The process of prepping the house for sale ( i.e. flooring, painting, landscaping, lighting) takes a minimum of 2 weeks. When there is a full kitchen and/or bathroom remodel(s) and/or other construction, it takes 6-8 weeks. I have a full team (contractors, electricians, plumbers etc.) that work solely for me. They come in and quickly get it all done.
Q: (Bitsa) Do you have any figures on the ROI from unstaged/remodeled to post staged?
A: (Margot) Under my umbrella, the biggest ROI is full staging. However, it is hard to come up with reliable rules of thumb expected returns on dollars spent invested in staging. Based upon my own experience, returns will vary greatly by which area in Marin the home is located and other characteristics making a property more or less desirable. As I mentioned, there is almost no cap on returns for dollars spent staging in neighborhoods like Kentfield and Ross. However, there will be diminishing returns in lower price point areas where a seller will not get past a certain price point level. In those cases, I would advise the seller against over-improving.
Thank you for your insight Margot! You transform each space into an aspirational vision and are a joy to work with.
While it is difficult to make generalizations on the tangible value of staging, here are some published industry stats.
- A recent survey from the International Association of Home Staging Professionals shows that staging helps sell homes three to 30 times faster than the non-staged competition. Further, staging can help increase the sale price by up to 20% on average.
- According to RESA (Real Estate Staging Association), by investing 1.3% of a home’s value in staging, 73% of sellers saw a return of over 7%.
- Similarly, in a 2021 National Association of Realtors report, 23% of sellers’ agents indicated that staging helped increase offer amounts by up to 5%. Agents surveyed said that staging increases offers by 6-10% and 6% of them saw offer increases of 11-15%. Also, according to HomeAdvisor, staged homes spend 33-50% less time on the market.
- International Association of Home Staging Professionals
- National Association of Realtors
Boulevard Real Estate was founded by fourth-generation Marin native Elizabeth “Bitsa” Freeman. Bitsa’s expertise in the local market, reputation for genuineness, honesty and deep community connections have made her a much sought after luxury Marin County agent. Bitsa is consistently a top-producer in Kentfield and Kent Woodlands. Boulevard is proud to be certified as a Green Business by the California Green Business Network, and awarded Marin IJ Readers Choice Best Realtor Honor for four years running- 2019, 2020, 2021, 2022. We love to focus on local women owned business owners like Margot Ovens of MO Design whose mission aligns so closely with our own.
Real Estate in Marin continues to experience unprecedented price appreciation due to extremely low inventory and high demand.* Marin County, as a whole, saw prices up 13% and volume down 19% YTD (year-to-date) vs. the same January through May period last year. Average Marin home prices are at a record $2,382,023. In Kentfield and Ross, this dynamic is even more extreme. Prices are up a whopping 18% YTD while volume is down 25%. The average sales price for single family homes in Kentfield/Ross this year is at an all time high of $4,943,639. San Anselmo saw the greatest appreciation for this time period with a 25% increase in sales prices. Novato, with typically the greatest sales volume in Marin, saw volume off 30%.
What’s driving the escalation in home prices? Simple economics of low supply and high demand.
The majority of homes are going for well over the list price with multiple offers. For Kentfield and Ross, bidding wars have been feverish and the price points eye popping due to such limited inventory. Young millennials starting to marry and have families are currently the largest demographic buying homes. Their desire for idyllic suburban Marin living has fueled this unprecedented demand. These young millennials will pay a premium for move-in ready homes and they will compete fiercely for the few that come to market.
There have recently been homes in Kent Woodlands that have sold for more than $2M over the list price!
Headline Making Hot Sales
- A home in Kent Woodlands that sold in March for $5,800,000, sold two months later after only two days on MLS for $2M over asking after some upgrades and new finishes – May sale price $10M
- A pristine, move-in ready home listed in Kent Woodlands, listed at $2,995,000, sold for $4,205,000 with 7 offers*
- A home in Ross sold recently for $18M in just 6 days
- Highest sales-to-list price was for a tear down in Kentfield which sold at 47% over its list price – likely to developers who see gold by flipping the property
Primarily, it is the homes that are in excellent condition, with all the upgrades and finishes, that result in the highest offers. Dated homes in premiere locations are also in high demand where there’s value in fixing and flipping. Contingent offers are becoming a thing of the past as buyers realize they can not compete with contingencies for desirable homes.
In Marin, 29% of homes are sold for cash and those buyers who are financing their purchase are looking for ways to compete with cash offers. Visit our website blog at boulevardmarin.com to learn about the options of how best to Compete in a Market Where Cash is King including bridge loans, innovative fin-tech programs and getting fully underwritten by your lender to avoid the need for a loan contingency. The landscape of options is complex and every buyer’s situation varies.
In recent years, declining interest rates helped stimulate demand and subsidized the surge in home prices. Early in 2022, rising interest rates fueled frantic demand as buyers rushed to avoid further increases. Big rate increases coupled with peak prices, may ultimately put a damper on purchases and prices going forward. Even cash buyers may be impacted by volatility in the stock market, inflation and overall financial uncertainty. As of June 1, the average rate on 30 year mortgage rates is 5.4%, up over 70% in 2022.
“It’s hard to predict where the market is headed, especially with rising interest rates and a declining stock market. Home sales data lag a few months due to the long timeline for the home search and closing process, so future indicators won’t be available until likely late Q2 or Q3. Some agents are reporting less traffic at open houses and fewer bids on predicted hot properties. Overall, there’s still way more demand than inventory but price appreciation is predicted to slow.”
While these cooling trends are expected to have a more significant impact on the national housing market, it is unclear how much the local Ross/ Kentfield market with its predominance of buyers long with tech sector and stock market cash will be impacted.
Boulevard Real Estate was founded by fourth-generation Marin native Elizabeth “Bitsa” Freeman. Bitsa’s expertise in the local market, reputation for genuineness, honesty and deep community connections have made her a top-producing luxury agent throughout Marin County. Boulevard is proud to be certified as a Green Business by the California Green Business Network, and awarded Marin IJ Readers Choice Best Realtor Honor for four years running- 2019, 2020, 2021, 2022.
*Note: All data in this article based on MLS data for Single Family Homes sales Jan 1 to June 1, 2022
In Marin’s hyper-competitive home market, all-cash offers give prospective buyers a sizable leg up on the competition.
On average, cash offers are 4X more likely to get the deal.
“Cash buyers have the advantage of being able to close quickly and are often willing to forgo any contingencies in their offers. These two factors are very attractive to sellers!”Jim Freeman, Senior Loan Advisor at CrossCountry Mortgage
We explore some options to help buyers who do not have cash on hand compete:
- What options exist for those who don’t have cash on hand but already own a home?
- What solutions exist for those who don’t have available cash or existing home equity?
- Can you be a loan buyer and still win the deal?
Options to compete in cash if you already own a home:
- Cash-out refinance can be an option when you already own your home outright. You aren’t paying off an existing mortgage, so most or all of the loan will come to you as a lump sum of cash. You can typically borrow up to 80% of your home’s value.
- Bridge Loans are used to eliminate a cash crunch and “bridge the gap” while buying a new home prior to selling your current home. For someone who owns their home outright or with a very low loan amount and wants to buy a new home, these can be an interesting option. You can borrow 65-70% of the combined value of both homes and use it to purchase the new home for cash. After the sale of the departure residence, some of the margin loan is paid down and then the balance is paid off by putting a permanent mortgage in place on the new property. Cons – Bridge loans are costly, typically about 2% upfront and charge around 8% interest Pros – A bridge loan allows you to compete effectively on the purchase of your new home and allow times to maximize the value of your old home. The resulting savings may offset the costs. Some of the points and interests may be deductible or offset capital.
- Hard Money Loan is a type of loan that is not secured by real property. Hard money loans are considered loans of “last resort” or short-term bridge loans. The lender generally is an individual or companies and not banks. The cost of a hard money loan to the borrower is typically higher than financing available through banks or government lending programs, reflecting the higher risk that the lender is taking by offering the financing. According to Jim Freeman, they can cost a couple points and have rates in the 10%+ range but allow for quick access to capital for a relatively fast close. They are typically paid off by putting a permanent mortgage in place after closing.
- FinTech Platforms for Homeowners like Revive offer a buy before you sell solution. Revive makes an all-cash offer on a buyer’s behalf. The buyer can move into the new home immediately and rent it from Revive (based on fair market value) for up to 12 months. When the old home sells, the buyer exercises the purchase of their new home. The fees for services like these are typically in the 1 to 3 point (%) range.
Options if you don’t own a home:
- Delayed financing allows buyers to use cash and stocks, to buy a house and obtain a mortgage after the home is purchased. Essentially, they’re enjoying the advantages of being a cash buyer while still getting the benefits of using a mortgage for leverage.
- Margin Loan or Liquidity Line against an equity portfolio or brokerage accounts can be a great option for folks who have a large brokerage account but may not want to sell shares and pay capital gains taxes. The rates are typically low and the ability to access the cash is quite fast. The risk to a margin loan or liquidity line is if equity prices drop you can be at risk of the brokerage having to sell your stock to pay back the loan. After the purchase they put a permanent mortgage in place and pay off the margin loan.
- iBuyers & Fin-Tech Companies for First Time Buyers have stepped in to capitalize on the fact that many prospective buyers without collateral assets are struggling to compete with cash rich wealthy people and investors. iBuying companies like Better, HomeLight, Opendoor, or Ribbon, make all-cash offers on buyers’ behalf. Then the buyer pays back the company. Fees, rules, and market availability vary.
“…for a fee of 1-3% companies will provide you with cash for a purchase and allow you to make a non-contingent offer to purchase a property and then put a permanent mortgage in place. Our company just announced a partnership with Ribbon to provide this service to borrowers on purchases up to $1mm using conventional mortgages for the permanent financing.”Jim Freeman of CrossCountry Mortgage,
Based on the calculations from the National Association of Realtors, the cost of obtaining a cash-backed offer is not much higher than the 3.7% to 4.4% average percent above the list price that buyers have already been offering to sweeten their loan backed offers.
How to win the deal even if you are a loan buyer:
Non-Contingent Offer – A loan buyer can effectively compete with a cash buyer when they write a non-contingent offer and close relatively quickly (21 days or so).
“Our job as loan advisors is to put a potential borrower in as strong a position as possible to purchase with a loan. Ideally we pre-underwrite the borrower so in some cases they can make a non-contingent offer to compete effectively with cash buyers.”Jim Freeman of CrossCountry Mortgage
Parameters for non-contingent offer:
- Pre-underwritten by their lender (rather than just pre-approved). In essence the lender has “credit approved” the buyer for a new loan
- Excess cash and assets beyond the necessary down payment, closing costs and any required reserves that could make up the loan gap if the appraisal comes in below purchase contract price
- Property is a single family home as opposed to a condo or townhouse which require a project approval from a lender a loan contingency in those offers are recommended
Sweeten the Deal
Even with a non-contingent offer, buyers would still need to be aggressive offering a higher price than the cash buyer to ensure the seller prefers their offer. The offer should be well written and have terms favorable to the specific seller’s needs such as flexibility on timing and an option for up to 60 day free rent back period.
The landscape of options is complex and every buyer’s situation varies. Please reach out if you have questions about what approach and solutions might be best for you. Boulevard prides itself on providing the resources and insight you need when buying or selling luxury properties in Marin County.
Boulevard Real Estate was founded by fourth-generation Marin native Elizabeth “Bitsa” Freeman. Bitsa’s expertise in the local market, reputation for genuineness, honesty and deep community connections have made her a top-producing luxury agent throughout Marin County. Boulevard is proud to be certified as a Green Business by the California Green Business Network, and awarded Marin IJ Readers Choice Best Realtor Honor for four years running- 2019, 2020, 2021, 2022.
- How Delayed Financing Gives Homebuyers Cash Power| Bankrate
- Ways to Compete With An All Cash Offer | Brickunderground
- Services Help Buyers Make All-Cash Offers For Next Homesource | Forbes
- Cash Sales Rise to 23% with Growing Entry of iBuyers and Fin-tech Companies | National Association of Realtors
Increased incidents of wildfires and the resulting damages are a major concern for California homeowners (See Recent Statistics Below). As billions of dollars in insured losses mount for carriers, it is increasingly becoming a challenge for some homeowners to protect themselves and their property.
I interviewed several agents representing different segments of the local insurance market to get their varied opinions and advice on what homeowners can do to protect their homes, families and communities.
Expert Advice: To counter the tightening insurance market, Jen Bair offered some suggestions for home buyers to improve the chances of their home being insured.
Seven Tips from Jennifer Bair for Buyers:
- Entryways – Choose a home with multiple entry options.
- Hill Position – Choose lower on a hill vs. being at the top; Consider if the road is wide enough for a fire truck to access.
- Don’t Delay – Call your insurance broker right away so they have time to shop the market as the industry is bogged down due to non-renewals and time required to write new business.
- Admitted Coverage – Seek admitted coverage first (carriers licensed to write in California); If not available, there are many good non-admitted options (carriers not licensed in California) as carriers are adding Excess and Surplus (E&S) lines to their repertoire to meet demand.
- Building Materials – Stucco homes and concrete tile roofs are preferred over wood exteriors from a wildfire safety perspective.
- Open Space – Look for homes more than 1,000 feet from expanses of open space.
- Fire Hazards – Remove easily ignitable trees like Italian Cypress and wood chips that are within the carrier’s defensible space requirements.
Each agent offered their expert advice for homeowners on navigating the market and thoughts on industry outlook.
Q: (Bitsa) Which insurers are still writing policies in Wildland Urban Interface (WUI) areas in California?
A: (Nima) The best source to retrieve that information is the California Department of Insurance website which has consumer links to help you find all types of insurance including auto, life and homeowners. They even have a Consumer Hotline phone number to help you navigate the process and learn what reputable carriers might be writing policies.
A: (Susan) Most companies are still writing insurance subject to wildfire mapping. In high brush /wildfire areas, it is very difficult to secure terms through an admitted company (carriers licensed to write in California).
A: (Jennifer) Each carrier’s capacity is different and doesn’t necessarily coincide with a WUI (the zone of transition between unoccupied land and human development). A carrier’s willingness to underwrite a home is situation specific. To counter the tightening market, there are things prospective homeowners can do to improve the chances of their home being insured.
Q: (Bitsa) How many carriers have dropped out of the market?
A: (Jennifer) Currently High Net Worth carriers Nationwide Private Client (NPC) and AIG are no longer writing in California due to capacity constraints. As a result, AIG decided not to renew home collections and umbrella policies in their admitted markets in California. Most AIG clients will have the option of transitioning to an AIG E&S option. Some mid market carriers (eg. Travelers and Liberty Mutual/Safeco) still write in California. However, they may not write in certain zip codes due to capacity issues. This is why brokers today have to truly “shop” your insurance portfolio to find where capacity exists, if it exists.
A: (Nima) Using the resources of the California Department of Insurance as a guide to who is writing policies currently will also give homeowner clues as to who is leaving the territory. Some insurers, like State Farm, grandfather existing policy holders – but that is not the case for all carriers. During the pandemic, Insurance Commissioner, Ricardo Lara, has been working with Governor Newsom to ensure that insurance companies wait a minimum year grace period before they can take action to alter policies in catastrophe zones. During concurrent pandemic and weather events, State Farm has refrained from underwriting review – specifically with regard to billing issues.
A: (Susan) The main carrier exiting the market is AIG. Others stopped writing new policies in California a couple of years ago and the balance of companies have introduced much stricter underwriting.
Q: (Bitsa) What is the future for insurance rates in WUI or high fire danger areas?
A: (Jennifer) Insurance rates are probably at an all time high. The increase in premiums is due to a number of factors which includes a larger percentage of losses and the cost of rebuilding homes in California. If you have gone to bid recently for a remodel or reconstruction, you have noticed the higher cost per square foot being quoted. Compounding those costs are supply chain constraints and inflation. That being said, some of our carriers are not taking rate changes this year due to corrections taken over the past couple of years. The future is unclear due to disruption in the financial and economic markets.
A: (Nima) For the first time after many years, State Farm has made adjustments to raise rates in accordance with the Department of Insurance to ensure adequate reserves for losses. I have not seen huge waves of rate increases and they vary region to region. The incremental risk for areas with extreme wildfire danger is spread over that entire region. For example, if an area’s wildfire risk increases 50%, the premium might increase only 30%. The 50% will be offset by other smaller increases over other parts of that region.
A: (Susan) I believe the California Department of Insurance will need to allow insurance companies to offer either wildfire deductibles or a wildfire sublimit or exclusion in areas of high wildfire.
Q: (Bitsa) Does being a Firewise USA community help rates?
A: (Nima) Yes. Some households may see rates go up by 50% if they don’t have Firewise certification. State Farm recognizes when a coalition of homeowners make an effort to create defensible space. Safe structure and updated utilities are rewarded with anywhere from 20-40% annual savings. There are techniques that homeowners can implement to save. It is about awareness. Factors include pricing of the building materials, fire resistant home structures and proper ventilation. Cement infused materials are more fire resistant. If you are in a renovation, simple things help. Install smoke/burglar detector monitoring systems and sprinklers and have endorsements attached to your home policy. Make sure that your building ordinance code enforcement components are not neglected in policy quotes.
A: (Jennifer) Possibly. If a location is insurable, a Firewise designations may offer a premium discount. It is unlikely that it will change an underwriting decision to insure a property. Firewise communities sprung up after residents of these communities complained they were not able to find homeowners insurance. This trickles down to auto and collections insurance because if a home is considered in high brush, automobiles and collectibles are also likely to be lost in a fire. Clients that require coverage were being turned away for their entire insurance program. The California Fair Plan (CFP), typically a last resort for homeowners, does take into account this designation and in some instances may offer a discount. Most of our carriers are focused on the overall insurability of the location vs. a designation.
A: (Susan) Honestly, no. It has not made a difference in premium or acceptability.
Q: (Bitsa) Can a new insurance commissioner affect policies that Californians can obtain?
A: (Susan) Yes, the Department of Insurance can change the requirements and filings for insurance companies in the state of California.
A: (Jennifer) The Insurance Commissioner definitely affects policies. However, their reach and impact is not immediately realized. The Commissioner straddles a line between protecting insureds while also trying to entice desired carriers to write in the state of California – goals often at odds with one another. The DOI created the Fair Plan as a solution for homeowners without options. They also increased the Total Insured Value (TIV ) of a home from $1.5M to $3M. Nevertheless, they also have requirements to minimize the state’s financial risks, such as proof the home is being properly maintained. The DOI continues to take action against unscrupulous brokers and agents, which often involves jail time and making financial reparations. The last few years have been extremely painful for a majority of insureds. More options are necessary to help alleviate the difficulty and expense associated with California homeowner insurance, especially since this can impact the resale value and marketability of a home.
A: (Nima) Governor Newsom and Commissioner Lara are communicating on this issue and watchdog groups are continuing to monitor it. Policyholders who are not renewed and have trouble finding coverage on the standard market are putting pressure on leadership. For-profit prospective carriers are reluctant to provide coverage and risk being over exposed. Carriers that leave California are an indication that appropriate premiums are not collected.
Help on the Way For Consumers:
In response to complaints, Commissioner Lara recently announced new regulations to improve wildfire safety and drive down the cost of insurance. Proposed regulations incorporate the “Safer from Wildfires” framework to protect existing homes and communities. The regulations, which could be in effect by this summer, require insurance companies to factor consumers’ wildfire safety actions into their pricing of coverage. They also will provide consumers with transparency about their “wildfire risk score” that insurance companies assign to properties.
“With more Californians rolling up their sleeves and reaching into their own pockets to protect their homes and businesses, insurance pricing must reflect their efforts… My new regulations will help encourage a competitive insurance market for all by putting safety first and driving down costs for consumers.”Commissioner Ricardo Lara
Thanks Jennifer, Nima and Susan for the inside perspectives! Please reach out if you have any questions about fire insurance or buying or selling a home in Marin County. You can find all kinds of information on how to protect yourself, your family and your home at firesafemarin.org and Recent Statistics on California fires below.
Boulevard Real Estate is a Certified Green Company committed to sustainability and fire safety. Bitsa is Fire Committee Chair for the Kent Woodland Homeowners Association. She led the efforts for her community to become Firewise Certified. We love to focus on local experts who serve our community like Jennifer, Susan and Nema.
- Scientists continue to warn of the effects of climate change. The latest sobering statistics on California wildfires support the importance of homeowners carrying the right insurance for wildfires.
- After a record year of wildfires in 2018, 350,000 California home and business owners could not purchase adequate property and casualty insurance because of the increased risk facing providers. This created significant issues for homeowners trying to satisfy mortgage requirements.
- Wildfires continue to be on the rise. 2020 was a record year with a 17% increase from 2019 and a 223% increase since 1983. Based on data from The Insurance Information Institute, the top seven costliest wildland fires in United States history were all in California. Each caused several billions of dollars in insured losses. In 2020 alone, California suffered more than 9 thousand fires, 4 million acres burned and 10 thousand structures destroyed.
- With nearly triple the number of properties at-risk in 2020 as the second-highest state, California is by far the most at-risk state for wildfires in the U.S.
Each option has pros and cons and different choices fit better depending on the type of project you are looking to pursue.
- No Lawn – grassy meadows, landscaped areas and patios can replace traditional lawns
- Dymondia Margaretae – a lower water, no mow ground cover alternative
- Lower Water Sod Varieties – like Delta Bluegrass
- Artificial Lawns – low maintenance but plastic can cause a heat island
- Kurapia – a lower water, no mow ground cover alternative
Where will your water be coming from?
- Municipal Water – has been the old stand by and we need to move away from
- Greywater Systems – collected from wastewater from washbasins, showers, and baths within the home
- Recycled Water – brought in during times of extreme drought (MMWD gives away recycled water in the summer)
- Captured Rainwater – collected in tanks; we should all really be doing this and greywater!
Contact The Water Champions for water-smart greywater solutions to create green abundance and water security in your home and community!! See what options are available, especially if you are in the build/remodel process.
Erin’s Expert Tips:
“Consider Kurapia, as a highly versatile, drought tolerant groundcover to replace traditional lawns. It can be mowed into a low cushiony turf or you can let it bloom into a lush groundcover. It is not a great fit for every project as It can take time to establish and may require weeding maintenance but worth considering.”
“Have your heart set on lawns, roses and hydrangeas? If you capture, recycle and conserve water and select other drought resistant plants, go ahead and incorporate some in moderation into your overall landscape design…the key is balance”
Erin Werner is a landscape designer who works in Marin County, CA specializing in planting design and spacial layout.
Boulevard Real Estate is a Certified Green Company committed to sustainability and fire safety. We love to focus on local businesses like Erin Werner Design which work to improve community resiliency and whose mission aligns so closely with our own. Erin got interested in plants and landscape design following in her father’s career footsteps and is a rare woman out in the field on installation job sites.
Anyone else make a New Year’s resolution to clear out all the excess accumulations cluttering your home, your life and your mind?
What steps have you taken to start that journey..?
If you are serious about letting go of clutter, The Joy Filter may be just the tool you need to let go and live a cleaner, less cluttered and stress free life.
Jenna Carlsson, owner of The Joy Filter and a Certified KonMari Consultant discovered the benefits of KonMari as she sought help organizing her own busy career and life. Learning that the key to organizing was both a physical and emotional journey of letting go, Jenna found Marie Kondo’s KonMari Method® an amazingly therapeutic means to living a more joyful, less cluttered life.
As a result of the experience in 2019, she launched her business, The Joy Filter, to help others attain the joy of living and working.
Jenna inspires and supports folks to let go of clutter and create lives of more organization, joy and ease. Need help working through all that you have accumulated over the years? Are you in transition and need to clear your space before you move? Downsizing and needing to get rid of what doesn’t give you joy? Jenna and The Joy Filter work in partnership with you, guiding you through the process, while honoring that every decision is yours. KonMari requires an investment of effort as you declutter and downsize, but it comes back around tenfold in relief, organization and joy. You can think of the method and Jenna as a big of a “space therapist.”
The first step in the process is creating a vision of what you really want in your home and life. Then, the KonMari Method® helps you alight your space to that vision, by deciding if pieces in your home or office advance your vision. Jenna see’s decluttering way to align with our lives with what we love, connecting to our intuition to decide what we want to keep.
She teaches that KonMari is not only a method of decluttering, but also as a tool we can use in all aspects of our lives. This is a method that will always stay with you after you are decluttered and living a life of joy.
If you are interested in learning more about the KonMari Method® or Jenna’s services, get a coupon code to come to a free Clutter Clear-out Parties here. Or, set up a free consultation here to see if KonMari is a good fit for you. Jenna offers both virtual and in-person services and even makes the process fun.
Are you ready to declutter your space and create a life of more organization, joy and ease?
An Exclusive Community of Abundant Natural Beauty.
Approximately 25 homes sell every year in Kent Woodlands with last years average sale price at $4,300,000.
Kent Woodlands is a residential community located at the base of Mt. Tamalpais surrounded by open space lands. Woodland Road is the only access into the coveted “Woodlands” community and residents choose this neighborhood for its seclusion, privacy and convenience. Consisting of approximately 570 residential lots, 481 lots are members of the Kent Woodlands Property Owners Association (KWPOA). The KWPOA represents members’ interests in regards to traffic safety, fire preparedness, architectural design review, social activities, as well as on county-wide issues, and maintenance of community development standards.
Why I Love Living in Kent Woodlands…
Proximity to Mount Tamalpais.
Hopping on your bike or stepping out the door directly onto our network of fire roads and trails makes meeting a daily step goal or Strava challenge easy to achieve. If dogs are your favorite exercise partner, the 3 miles of flat fire road, where dogs can roam off leash, as well as numerous trail extensions along the route (dogs on leash) make trail runs and vigorous hikes the best with our furry friends.
Every year the neighborhood HOA (Kent Woodlands Property Association) hosts a number of community events. One of the neighborhood favorites is the Halloween Parade when lower Woodland Road is closed to traffic and Kentfield Fire trucks lead a procession of ghosts, goblins, witches and action hero’s to neighbor treat tables. The annual holiday party, usually held the first Sunday in December, is hosted in the exterior annex at Guesthouse. Recently the community began hosting food truck events held in our Acorn parking lot at the entrance to Kent Woodlands in May and September. In a hillside community with no sidewalks to meet and greet your neighbors, this has proven to be a popular event
Shopping & Dinning
Woodland’s Market and Cafe, located at the entrance to Kent Woodlands, is a neighborhood favorite and the unofficial community center of the neighborhood. Known for gourmet food to go, catered meals, custom and speciality sandwiches and a wide selection of organic and locally sourced foods it is also the after school crowd’s favorite post school hangout. A few blocks from the entrance to the neighborhood is Rustic Bakery known for their decadent scones, cinnamon rolls, croissants and fresh baked breads. The lunch hour usually means lines out the door but if you order to go you’ll miss the lines and the long wait. GuestHouse is a fairly new addition to the neighborhood and has become the go to dinner spot with innovative menu items and a very popular full bar with some of the friendliest bartenders in the area
Another great aspect of living in Kent Woodlands would be the excellent public schools; Bacich, Kent and Redwood High School are the reason so many families choose this location when fleeing urban living. The demographics of this community are a good mix of young families with school age children and older retirees and empty nest boomers. Many Kent Woodlands homewoners have been in their homes for over 25 years.
If you are interested in buying in Kent Woodlands check out our current listings.
Privacy, Seclusion & Move-in Ready!
4 Bed ~ 4 Bath ~ 2,850 Sq/f ~ 48,300 Sq/f Lot ~ HOA Fees ~ Pool
Kent Woodland’s latest luxury home sale: A private paradise in Marin County; rare, single level, and move-in ready. This home sits on a lush, 1(+)ac. forest filled, street to street lot. Surrounded by soaring Redwoods and an ephemeral creek this beautifully updated and meticulously maintained home is designed for indoor/outdoor living.
The dramatic, large scale rooms and open floor plan features warm-toned hardwood flooring, soaring, exposed beam ceilings and plenty of windows bathing the home in natural light. A spacious kitchen/great room combo includes an impressive granite topped island, breakfast bar w/seating, a wet bar, an indoor grill and two fireplaces, ideal for entertaining and large family gatherings.
The living room with warm wood paneling features a dramatic, floor to ceiling fireplace an impressive barn door which can close off an additional space, ideal as a playroom and two additional en suite bedrooms. The main bedroom is an oasis of tranquility and relaxation, featuring a luxurious spa like bath and generous walk in closet.
View the gallery below, along with property features and the houses floor plan. Interested in more details or scheduling a showing, see more at boulevardmarin.com
- Hardwood floors, vaulted, exposed beam ceilings, skylights
- One level /Open Floor plan
- Kitchen features large island, breakfast bar, granite counters, indoor grill and fireplace
- Bonus room off kitchen with wet bar, built in shelving & fireplace
- Warm wood paneling and floor to ceiling plaster of Paris finished fireplace accent the living room
- Updated baths with high end finishes and fixtures
- Air conditioning
- Main living areas open directly to pool/spa area
- Private trail through property to lower Kent Woodlands
- Gated, fenced and irrigated yard
- Separate 2 car garage
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