Estey Real Estate Sales & Property Management
Providing our expertise to meet YOUR needs!
February 2014

Eric Hoglund

Street Address
935 First Street,
Benicia, CA 94510
Phone: 707.745.0924


Best Practices

Check Your Insurance: Events can happen - flood, extreme heat, earthquakes, fire, and more! It is important to check your insurance to obtain the best coverage possible and ensure that it is current.Review now with your insurance agent before a disaster/emergency occurs.

If An Emergency Occurs: Please be patient and avoid tying up critical phone lines and our time. Our first priority during any emergency is to handle the situation, taking any necessary measures for the safety of your property and your tenants. Then, we will contact you as soon as we are able.

Our Associations
A Tradition of Excellence, Integrity, Knowledge, and Service for over 60 years!

Benicia Home Prices Heading Higher

Here are some highlights from an article Eric Hoglund recently contributed to Benicia Magazine:

By all accounts 2013 was an amazing year.

  • There were 264 single family homes sold in Benicia (at the time of writing).
  • The median home selling price was $455,000, on average a full 1% over asking price.
  • This resulted in a 20% increase in equity over the previous year, outpacing the 10.9% national increase.
  • Inventory was low for most of 2013 and limited choice increased competition.
  • Rapid home sales created a market of sellers in search of a temporary rental home, causing a decrease in avaliable rentals.
  • There was very little new rental inventory entering the market, meaning most buyers were occupying their new property - a sign of economic recovery.

Can we expect the same performance for 2014? Probably not, but the outlook is still very good:

  • Kiplinger's estimates that the national average will be 3% to 4%.
  • However, Benicia's micro economy lends itself to a few promising realities, as follows.
  • There is no new residential construction planned in the city limits, forcing buyers to select from existing homes.
  • Benicia is still one of the safest places to live in California.
  • Benicia is one of the last places in the Bay Area where one can still buy a waterfront home for under $1 million dollars.
  • Benicia should outpace the national average, but we should not expect a repeat of 2013. A 20% gain year over year is unrealistic.

Here is an insider, “not so secret”, tip.  Buy in the winter when the weather is bad and people don’t want to move. You will likely get a better price from the seller who, for whatever reason, is forced to sell at this time, and you can have the satisfaction of seeing a comparable home selling for thousands more just a few months later.

Why Use a Licensed Contractor
for Your Rental Property

A rental property is an important part of your financial portfolio. It generally takes careful planning and a large financial outlay, which is just the beginning. A successful investment takes expertise, which is why you think carefully about who will manage your property and we thank you for choosing our company.

In addition, proper maintenance will play a major role in the lifetime and the success of your investment. Obviously, maintenance costs will affect your return on investment. Therefore, the question most often asked by property owners is, "why use licensed contractors when you could use non-licensed parties at a lower cost?"

The answer to this query is similar to that of a medical problem. You may be able to solve a medical issue by consulting your pharmacist or a nurse practitioner but if it is not easily manageable, you want the advice and expertise of a licensed and experienced physician. Why would you not take this same approach when making the decision on whether to hire a contractor? You want the best solutions for your health and it is just as important to make the best choice for the wellbeing of your investment.

Just as you may seek more than one opinion for a major medical problem, a common sense approach to property maintenance is to obtain more than one bid for any extensive work required. It is normal to want to pay the lowest price possible so you can realize the best return on investment. However, it is important to compare qualifications, particularly if one bid is so much lower. This important decision could have costly results.

Non-licensed laborers or companies can generally offer much lower prices because they are not bonded or insured or pay into a contractor's recovery fund or worker's compensation. Most investment insurance policies do not carry worker's comp with coverage. A non-licensed worker may be able to sue the owner after getting hurt on the job. If this happens, it is possible the owner could be sued directly and not have coverage. Ask your agent about your coverage.

Many of these unlicensed companies do not meet state and federal requirements when it comes to their workers and/or employees. They often do not have the capital and experience for the job. Since they do not have a solid financial background, they do not have the resources to pay for damage or costs if the job goes awry.

Licensed individuals and/or companies know that it is important to have the proper licensing, insurance, knowledge, and be responsible if using other laborers. They understand that underbidding the work can lead to financial disaster and continuing problems. Why would you trust such an important asset to a non-qualified party?

Another consideration for hiring a licensed contractor is what the state (for the location of the investment property) or federal government dictates. Most states require licensed contractors for the majority of property repairs. Often state and federal legislation mandate the use of specialized contractors - an example of this is work on lead-based paint. It is crucial to your investment to follow state and federal laws and regulations. There have been many penalties issued to property owners for non-compliance.

The bottom line answer to the question on why you should use a licensed contractor is to avoid and reduce liability. Investors have incurred great financial losses by not using a licensed contractor. There have been many lawsuits against property owners because of improper workmanship. This is also why there is increased state and federal legislation concerning contractors. It is important that the individuals and/or companies working on your property have the qualifications, the insurance, and meet the state’s requirements for any work performed on your property.

As your management company, we cannot contract for work with a non-licensed party if a state or federal agency dictates that a licensed contractor is compulsory or the company is not "accountable." In short, we would not be performing our best management for you and your investment. If you have questions on this important subject, let us know and we will be happy to discuss them with you.

The material provided in this newsletter is for informational and educational purposes only. It is NOT legal advice.
Although we believe this material is accurate, we cannot guarantee that it is 100% without errors.

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