Tuesday, June 3, 2008

What’s up with those cheap Russian River real estate listings?

Do you frequently browse the real estate section on Craig’s List or the San Francisco Chronicle & wonder about all those insanely affordable listings for the Russian River*? Perhaps you’ve even visited & salivated over all those “affordable charmers” beckoning tantalizingly from the local realtors’ window displays. If so, I certainly can’t blame you. Especially if you live in the Bay Area & STILL find yourself priced out of the housing market. $650K for a 2BR/1BA “fixer” starter home in a dicey neighborhood with substandard schools? Jeez Louise!

My husband & I finally succumbed to 10+ years of temptation, sold our house in Berkeley, & bought our home in Rio Nido in late 2004. Living out here has definitely required some adjustments, but over all, things have worked out quite well for us. With friends & acquaintances purchasing homes in equally far-flung places like Antioch & Patterson (which seemed far less appealing to us) & facing the possibility of our daughter getting assigned to an inferior school in Berkeley (which can happen even in the most desirable & expensive Bay Area neighborhoods), making the move no longer seemed quite so crazy as it once did.

We revel in the natural beauty around us; enjoy our friendly & caring community & neighbors; love our “adorable, cozy 3BR/2BA” (which, at 1,600 square feet is fairly modest, but spacious compared to our apartment in San Francisco & our teensy little starter-fixer-home in Berkeley); & feel totally thrilled with the Guerneville Elementary School (K-8), where our daughter is now finishing Kindergarten. We’re still only an hour & change from our former haunts in San Francisco & Berkeley … yet we’ve also discovered a surprising number of urban & cultural amenities right here at home.

Too good to be true? Maybe … or … Maybe not.

Are these relatively inexpensive properties too good to be true? As a former resident of San Francisco & Berkeley who is hence privy to real estate insanity, I have to say … maybe … then again, … maybe not. It all depends on how strongly you’re drawn to this place, & what’s truly important to you over the long haul. The Russian River isn’t just a place to hang your hat, it becomes a way of life.

As a person who since early childhood has only experienced life in heavily urban environments, small-town living often feels like entering a bizarre time-warp. It’s sort of like inhabiting Garrison Keillor’s idyllic Lake Wobegon, spiced up with a dash of Charles Bukowski & David Sedaris. For better & worse, everyone knows everyone else, & everyone’s business, which often turns out to be quite scandalous.

Homes are definitely more affordable here. You can still get a decent, 3br/2ba home for $350K or less. I’ve even seen listings for livable fixers for $300K & under. Or, you can have a larger home with all the amenities -- an acre or more of land; modern kitchen with granite counter-tops, newly installed hardwood floors; built-in cabinets, shelves & closets; deck with hot tub; fruit trees, etc. for around $500K.

And these are just the asking prices. In today’s depressed real estate market you might be able to successfully make an offer for considerably less – if you & your realtor handle things right. Even in boom-times, buyers can negotiate with sellers in this area over repairs & other issues, when they turn up in the inspection report. Apparently, our community is too small for even the most desirable properties to inspire the dreaded bidding wars endemic to the inner Bay Area.

On the other hand, you can’t be a total jerk & make an insultingly low-ball offer on homes around here. Yes, some homes are in – or on the verge of – foreclosure (as you can see on Yahoo’s real estate site). But others have extremely low (or entirely paid-off) mortgages, & sellers can afford to wait until the market turns around. I’m also surprised to see that the foreclosure listings are still rather pricey (the bidding for homes comparable to ours starts at a bit more than we paid).

The upsides to living in the Russian River area

Russian River offers incomparable natural beauty; a strong feeling of community; excellent schools & preschools (with free after school programs available for K-8 in Guerneville & Monte Rio); some truly lovely neighborhoods; reasonable commutes to good jobs in some fields; unreasonable – but do-able – commutes to more jobs in the inner Bay Area; & a surprising number of the “city” amenities you currently enjoy in the immediate area, plus more in nearby Sebastopol & Santa Rosa. And best of all ... we don't have any of those ugly subdivisions out here. The Russian River boasts an eclectic diversity of architecture, unique & beautiful properties, & there's something for everyone.

Amenities on the Russian River include:

  • Culture: The newly Russian River Music Conservatory in Guerneville & the Pegasus Theater in Monte Rio perform throughout the year. If you like to sing, you can join the Russian River Choir, which performs both classical & modern pieces. We have several popular small live music venues, including The Rio Nido Roadhouse, Main Street Café, & the Pink Elephant in Monte Rio, in addition to the huge Russian River Blues Festival held at Johnson’s Beach every year. We also have a variety of art galleries featuring works by talented local artists & a book club at the Guerneville Public Library. Writers do readings at the River Reader bookstore in Guerneville. For national & regional acts, the Wells Fargo Performance Center is a short distance straight up River Road.
  • Food: We have lots of good restaurants around here. Our favorites are Mosaic, Applewood, Stella’s Cafe, the Village Inn & the River’s End for fine dining; Nit’s Thai Creations & Sizzling Tandoor for great ethnic food with a view (the former is on the river in Rio Nido, the latter overlooks the ocean in Jenner); & the Rio Nido Roadhouse, River Inn Grill, & the Garden Grill for delicious & affordable casual/family dining. Lots of folks around here also love Taqueria Tapatia in downtown Guerneville. Also there’s our iconic local hangout, which is Pat’s Diner by day (good, greasy, comfort food) & Chef Patrick’s by night (with affordable classics like chicken marsala, plus an assortment of more innovative dishes).
  • Outdoor recreation: With the river, Armstrong Woods, & the coast nearby, there’s plenty of hiking, surfing, fishing, & bird watching around here. It’s fun to canoe & kayak around here & a few places to rent them if you don’t have your own, or take guided tours. And we also have the lovely Northwood Golf Club, where you can golf under the redwoods. Western Sonoma County is also a beautiful place for bike rides for both serious & amateur cyclists. If you’re serious about physical fitness & also need indoor recreation, there’s the wonderful, full-service Airport Club gym within easy driving distance in Santa Rosa – it has just about everything, including childcare. For folks with simpler needs, we also have a nice, inexpensive, place right here in town (the Gym for Everybody). The service is friendly, the equipment is very basic, & the owners will enthusiastically help you create a good custom work out if you need help. People also frequently go wine-tasting, apple & berry-picking, & mushroom picking.
  • Kids/Family fun: River To Coast Childcare Services offers Kindergym for the crawler through preschool set on Monday & Tuesday mornings (9:30am-12pm), with an assortment of fun art, music, literacy, & physical activities for the kids. Kindergym also offers opportunities to connect with other parents/caregivers, plus the RCCS folks all have extensive Child Development education & experience & can address any questions & concerns about ages & stages, etc. that you may have (they’re really nice & non-judgmental – many of them are also bilingual/Spanish). RCCS can also help you find childcare in the area & obtain subsidies if your annual income qualifies. The Guerneville Public Library has a fabulous story time/literacy hour on Wednesday mornings for the little ones & Saturday movies for all ages at 12noon year-round. They also feature events (including music, magic, & nature talks) during summer vacation, which appeal to kids of all ages (& grown-ups as well). For summer swimming & water play, there’s the Rio Nido Pool, Johnson’s Beach, & Monte Rio Beach. West County Services runs an excellent after school program during the school year at the Monte Rio & Guerneville elementary schools, & also a summer camp ($100 per week) at the Monte Rio Elementary School & swim lessons at Johnson’s Beach & Monte Rio Beach (you’ll need to call them – they don’t update their Web site terribly often). Mama Java’s Coffee Shop (on Route 116 next to the Northwood Golf Course) in Monte Rio also has an ongoing mother’s group, which meets on Monday mornings.
  • Our schools: The Guerneville & Monte Rio Elementary schools go from Kindergarten through 8th grade. On the GreatSchools.net Web site, we have good ratings in terms of test scores (7 out of 10, with “Distinguished Schools” awards from the state for meeting goals & increasing test scores even though we’re a rural & low-income area), & EXCELLENT 4-5 star ratings from happy parents. Our small campuses encourage an intimate, accepting atmosphere. Older kids mentor the younger ones as “reading buddies” & classroom helpers. Through our environmental education programs, children plant, tend, & harvest our school gardens & also learn to enjoy preparing & eating what they’ve grown. The kids take numerous field trips & participate in various enrichment programs, including art, music, computer lab, folk dancing, band, athletics, & more. We also have resource specialists for special & gifted education. Parent involvement is huge – my daughter’s classroom alone has at least seven parent volunteers. Class sizes are small & our children truly have the opportunity to grow up together & contribute their individual abilities towards this community.

That’s just a sampling what you’ll find in the immediate area. There’s much more in Sebastopol & Santa Rosa. And we’re still only an hour & 15 minutes (if you time it right) from San Francisco, Berkeley, & Oakland.

… And the downsides

Alas, the Russian River definitely has its downsides. Although we’re only about 60 miles from San Francisco & 20 miles from Santa Rosa, this area can still sometimes feel remote. There are basically only two ways out of here – River Road & Route 116 & -- depending on where you live – a few back roads. If there’s an accident or road construction (which you can look up on CalTrans’ Web site), you’ll need to find an alternative route &/or add 15-30 minutes to your trip.

And, yes, we do sometimes have floods, though it isn’t nearly as bad as outsiders think. Most homes are away from the flood-line (or have been raised above it, thanks to Russian River Redevelopment funds). We don’t have flash floods & hence have plenty of time to prepare (basically, we need 10 straight days of rain for a major flood to occur). But when a flood seems imminent, you will need to decide whether to stay in, or stay out. You should also keep a stash of emergency supplies around, just in case.

You really need to be laid-back & tolerant in order to live here, because you’ll have all sorts of neighbors, including: aging hippies, nouveau hippies, bikers, bible-thumpers, rednecks, Latinos, senior citizens, registered Republicans, & meth addicts, along with the cast of characters you already know from the city: young professionals, foodies, middle-class families, ultra-liberals registered with the Democrats or Green Party, Latinos, Sikhs, gays, lesbians, artists, musicians, writers, & … yes … a sizeable homeless population. And these are just the human neighbors. Prepare yourself for deer (who adore late-night snacks from your garden), brown recluse spiders, poison oak, wild pigs, raccoons, possums, & more.

And, yes, the Russian River does have the reputation as the methamphetamine capitol of Sonoma County, though much of this nefarious activity has moved up north, to Clear Lake & Mendocino counties. Alas, crystal meth has cursed rural areas in recent years, just as crack began wreaking havoc upon urban areas 20 years ago. Potential renters & homebuyers seriously need to take a look at who their neighbors will be, before making an offer on their home. On the other hand, we don’t have gangs out here & (as a parent), that’s a HUGE plus for me. When push comes to shove, I strongly prefer disorganized crime to organized crime.

You’ll also need to slow down. Way down. Rude city habits like tailgating; huffing impatiently when the person in front of you chats leisurely with the cashier while writing a check (yes, people actually do write paper checks around here); or making vehement political statements with the assumption that everyone shares your liberal views (many do, but some don’t), can quickly make you a social pariah. Folks around here are generally kind & tolerant towards one another as a matter of necessity, as well as personal inclination: You never know when you might run into someone again … or need their cooperation or help.

Career-wise, you’ll need to do some planning & research. We do have a reasonable job base with a handful of local employers & professional jobs only 30-40 minutes away in Sebastopol & Santa Rosa. Some folks hang on to their city jobs – it helps to have an employer who is flexible & allows telecommuting. If your job requires lots of travel, it may not matter so much where your home base is located. Many people successfully own restaurants, retail & other small businesses out here, but things can get tough during recessions & during our “off” season.

Also, you need to be aware that many properties around here are kind of “funky”, because many of them were built as summer vacation homes, not for year ‘round use. Keep an eye out for odd layouts, lack of insulation, & wood burning stoves as the only heating source (very charming & highly economical, but a pain in the neck for those who don’t enjoy chopping wood & sweeping ashes). Also, we don’t have natural gas out here, we have propane, which is more expensive – especially if your propane provider owns your tank & rents out its use to you.

For homes that aren’t hooked up to Guerneville’s sewer, septic systems can be a major issue. In general, septic is cheaper … until you have a problem or need to increase your capacity – which is often difficult or impossible to do in compliance with today’s more stringent codes.

Our abundant redwood trees are both a blessing & a curse. They provide beauty, privacy & shade, but they are also like giant weeds: they are highly aggressive, grow shockingly fast, & sprout out new saplings from their roots at a brisk rate as these giant Ents attempt to surround your home in a fairy ring. They have long & extensive networks of roots, so you’ll need to make sure they won’t potentially undermine your foundation. Redwoods growing within 5 feet of your house may prove hazardous to your home & eventually need to be removed (an expensive undertaking – renting the crane alone can cost $1500+). The redwoods drop huge amounts of leaves, branches & other debris on your roof & your car over the course of a year. Prepare to spend a few hundred per year on “limbing” & other maintenance to remove dead branches, keep the trees healthy, & ensure that your property receives a reasonable amount of sunlight. Fortunately, the Russian River abounds with good arborists.

Doing remodels & repairs may prove more expensive than you think. Although we have lots of good contractors who charge less than you would pay in the Bay Area, I’ve discovered that the Permits & Resources Management Department (PRMD) in Sonoma County is even harder to deal with than the one in our former city of BERKELEY (& that says a lot). Not only are they bureaucratic & uncooperative, they also have a reputation for giving people a hard time about previous & totally unrelated work that was done years before you bought your place. I do, however, appreciate the fact that SoCo’s PRMD has made their entire set of building codes available online. Also, there has been a new wave of young & eager hires, freshly graduated from the top planning programs at universities like Berkeley & Portland, OR, who are pushing for reforms & inclusion of new technologies & greener systems in the building codes.

If you think that your property taxes will be less onerous than what you’re paying in the city, think again. The percentage levied on the value of your home (what you pay for it) will be higher than what you would pay for a similarly priced home in the city (though there ARE no “similarly priced” homes in the city), because: (a) the cost of our services is distributed amongst fewer people; & (b) according to many long-time residents, Sonoma County’s government is evil, corrupt, & venal. On the other hand, you really do come to have an understanding of & intimate relationship with where your tax dollars are going, because many of the folks who provide these services are your friends & neighbors – who are all in the same boat & pay the same taxes as you do – & they care about this community & work awfully hard to make things right.

If you are still interested in buying a home here:

The Russian River isn’t for everyone, but if you’ve always felt drawn to this place, go for it. The natural beauty is incomparable. We did it three-and-a-half years ago & have few regrets, even though we bought close to the top of the market & have gained little – if any – equity (it helps that we have a 30-year fixed mortgage with a low interest rate & that we’re definitely here for the long haul).

  • First of all, you need a SAVVY REALTOR who really knows this area & all the different neighborhoods & types of homes & who can steer you away from the potential pitfalls. Ideally, your realtor should actually LIVE here on the Russian River, have strong connections with some local contractors, & have a good understanding of what it’ll REALLY cost to fix things that turn up in the inspection reports.
  • Make sure your potential home has decent INSULATION (many don’t). Otherwise your energy costs will go through the ROOF (literally as well as figuratively) during the winter. Our heavy winter rains also make our homes prone to rot & mold.
  • DON’T buy a place as a vacation home & assume that you can defray the costs by offering summer rentals unless you have deep pockets &/or really know what you’re doing. It’s hard to profit from rentals when carrying a mortgage. Plus, there’s maintenance, taxes, etc.
  • If you’re handy & willing to build “sweat equity,” you can get a good deal on a “fixer.” But you’ll need patience, because you’ll probably need to stay for several years (fix-&-flip people need not apply). You’ll also need some cash for the repairs, because home equity loans are hard to come by these days.
  • Unlike San Francisco, Berkeley, & the Peninsula, you can actually negotiate with sellers around here when making an offer. Invest in all the appropriate inspections. Make sure that all work done to your house was done with a permit. If it wasn’t, negotiate for a lower price.
  • Homebuyers are often floored when their first property tax statement arrives! To avoid this unpleasant surprise (& have sufficient funds set aside), review your future home’s property tax statement. Although the previous owner’s assessment will be considerably lower than yours, you can go through the list of items & percentages & do the math.
  • “Funny financing” schemes like ARMS, 100% financing, liar loans, etc., can get you in trouble on the Russian River. Even when the real estate market is sizzling, homes take at least 3 months to sell. Oh, well. The banks probably don’t offer these types of loans anymore. You need to do conventional financing (20% down, 30-year-fixed) & be able to afford the payments at least somewhat comfortably. Fortunately, this is entirely possible on the Russian River, if you plan things right.

Still interested? For more information about the Russian River & to get an idea of what it’s like out here, visit the following Web sites:

*When I mention “the Russian River,” I’m mostly referring to the three towns located within the Russian River Redevelopment Area: Rio Nido, Guerneville, & Monte Rio. This is where I live & what I know best. More “official” folks, like Craigs’ List, wine makers within the “Russian River” appellation, & local realtors also consider parts of Healdsburg, parts of Windsor, the unincorporated part of Santa Rosa, Forestville, Occidental, Camp Meeker, Duncan’s Mills, Cazadero, & Jenner to be the “Russian River.”


Anonymous said...

Hithere. Last month you posted about summer events, inclding Rio Nido clean up day, on July 12. Is that still on? I own a lot in Rio Nido and would like to pitch in. I hope I posted this in time for you to see it before the big day. I was there today but didn't see a notice on the bulletin board near the Post Office. Thanks!


Anonymous said...

What an awesome blog post. Thank you for being so detailed.

We love the Russian River and needed a perspective from someone who has moved from the SF Bay Area up there.

Kudos and thank you again!

Kirsten Flynn said...

I just found this slightly old blog post, are your still living there?
I love that area, and have been renting there every summer for the past 4 years. We also are in the Bay Area.
I also am a hostess through airbnb, and am seriously thinking of buying a property up there, and running it as a rental and also get away for us. My husband and I are both very handy, in different ways, and my last kid is one year away from college. We are down to earth, and love the more realistic vibe in the Russian river.
Do you have any suggestions of who I could talk to about realistic estimates of occupied vs. empty weeks in a rental? I just want to gather information. I also am curious about septic systems, as I have always lived with city sewer.
Any chance you could help me out? I will read through more blog posts to see if you have already answered these questions.