Getting your home in near model home condition can be a daunting task. It’s especially important this spring, however, as after a long and soggy winter, buyers are finally emerging from hibernation and finding themselves in a market inundated with listings. 

But spring cleaning needn’t be all bad. Setting your home apart by using green-friendly resources in your home beautification efforts can build appeal. Fortunately, in the Bay Area you can find loads of products that minimize damage to natural resources and create a healthy living environment. 

According to a recent survey conducted by the National Association of Home Builders, there has been a 20 percent increase since last year in builders dedicated to green building issues, and that number is expected to rise another 30 percent in 2007. 

The rise is attributed to a growing awareness about the financial and environmental benefits of using more efficient heating and cooling systems, energy efficient appliances and lighting, and low-flow faucets and toilets. 

Even if you’re just planning to tackle basic cleaning, painting and repair, investing in green resources can lead to a big payoff. In fact, the United States Green Building Council estimated in 2003 that “an upfront investment of 2 percent in green building design, on average, results in life cycle savings of 20 percent of the total construction costs - more than 10 times the initial investment.” 

The City offers an outstanding resource guide at www.sfenvironment.com, as well as a downloadable version of its “Home Remodeling Green Building Guidelines.” 

Remodeling Pays! A recent study by the Joint Center for Housing Studies of Harvard University found that San Francisco home owners recovered as much as 118 percent of their home improvement costs in 2002. They also discovered that paybacks depend on the type of improvements made. For instance, based on the national average, remodeling a bathroom could result in a return of 88 percent, while kitchen remodels only returned 67 percent of their cost. 

Is there a real estate bubble? That seems to be the question on everyone’s mind. If you read the SF Chronicle real estate section today, you’ll see they dedicated the front page to this question. In my humble opinion, there is no bubble. I’m more in the camp that the real estate market operates like a balloon. If air is being blown in, then the market climbs. If air is being let out then the balloon deflates. The market has had a lot of air being pumped in to it the past 10 years. What has been blowing the air in? I’ve seen high demand from buyers; money has become easier to obtain and cheaper than ever before historically; supply is currently low; and the economy is growing. All of these factors contribute to the real estate market. 

So why all this talk about a bubble? Historically, the first quarter of the year is fairly quiet in real estate. This year is no exception to that, though the last two years have been. What we’re seeing is less air being blown in to the balloon, so the real estate market is not growing at the same break-neck speed that it had been the last two years. I attribute this slight decrease to the fact that money is becoming slightly more expensive with the increase in interest rates, and the decrease in affordability. The affordability index in San Francisco was at 9% in December. This index measures the percentage of households that can afford to purchase a median-priced home. The index for the United States is 49%. If you can imagine a balloon that is really hard to blow up, the elasticity is tight, that’s how I imagine the affordability index. There just aren’t as many people who have lungs strong enough to blow up a balloon when the median home price is $712,940. However, there are still enough people who are strong enough to keep demand up. I’m still seeing multiple bids and over asking offers. So, while the balloon isn’t increasing in size as quickly as it was the past two years, it’s still getting bigger. 

One of the most interesting factors that I learned about at an economic summit I attended, courtesy of Union Bank of California, is that job growth in the Bay Area is trending up. We saw the first increase in employment growth in the Bay Area in 2005 than we’d seen in since 2001. What’s even more interesting to note is the growth in the real estate industry as a whole. The construction sector experienced the second greatest growth, and the financial activities sector, including realtors and lenders, experienced the seventh largest growth, out of 14 sectors overall. So, in a way, the real estate industry is contributing to the real estate market growth. New jobs means more people, which means more people looking to buy real estate, keeping demand strong, keeping the real estate market strong.