The cost of living in a San Francisco Bay Area home

June 30, 12:50 PMReal Estate News ExaminerBroderick Perkins

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The median home price in the San Francisco Bay area was down to $350,000 in May, nearly half the peak median of $665,000 back in July of 2007, but the cost of living in your own home still isn't cheap.

There's more to buying a home than just the purchase price.

Everything in real estate is negotiable, but here's what you can expect to pay.

Down payment

Most mortgages available today require a 20 percent down payment — $70,000 based on the median price from the San Diego-based MDA DataQuick real estate information service. The median includes new and resale houses and condos.

FHA, VA, other federal, city and state government programs can get you in the door for less down — zero, 3.5, 10 percent — depending on the program.

"There are lots of incentives for new homes, but for resales, the incentives just aren't there," says Julia Truesdale Keady, president of Silicon Valley Association of Realtors, based in Cupertino.

Interest rates

In late June, interest rates averaged 5.4 percent, according to Freddie Mac. The rates include about one point. Each point is 1 percent of the purchase price — $3,500 on the median priced Bay Area home.

"When I quote rates, they will include fees [points] to get that rate," says Quincy Virgilio, president of the San Jose-based Santa Clara County Association of Realtors. He also says some rates are as low as 5 percent (plus a half to a full point) for loans no bigger than $417,000.

Property taxes, homowner insurance, HOA dues

Expect to advance pay some property taxes and homeowner insurance premiums. Otherwise, you'll have to document you've socked away enough to cover the cost for a few months. Throughout the Bay Area, annual property taxes are typically about 1 to 1.25 percent of the home's purchase price. Homeowner insurance will set you back an additional $50 to $100 a month. Higher deductibles and discounts net lower premiums.

Monthly HOA dues (paid by residents of common interest developments (CIDs) such as condos, townhomes, etc.) vary from property to property, but average about $400 a month for a $500,000 unit, says Keady, also a real estate agent with Alain Pinel in Palo Alto.

Upkeep, maintenance

Keady says because monthly dues help pay for the CID's upkeep and maintenance, that amount is a good target for single-family homeowners to consider saving for upkeep. But Richard Calhoun, broker-owner of Creekside Realty in San Jose, disagrees, because only half of HOA dues go to upkeep. The other half pays for management. That means single-family homeowners who mange their own home can get by for less.

The final figure is property-dependent and based on the home's age, condition, wear and tear and other factors. "Some people are harder on homes than others," says Virgilio, who is also a mortgage broker and owner of Realty World CA Property Network and Mortgage Network, both in Campbell.

Transfer fees

City property transfer fees vary widely from city to city and range from as little as $0.55 per every $1,000 of the sales price in many San Mateo County cities, to $3.30/$1,000 in Santa Clara County cities of San Jose and Palo Alto, to as much as $15/$1,000 in Berkeley and Oakland in Alameda County. Bay Area counties also charge a transfer fee, typically $1.10/$1,000 in each county. Who pays is determined by local customs, but buyers typically pick up some of the cost.

Additional fees

How much more the buyer pays in settlement fees varies based on local custom and the sales contract. Fees include title and escrow costs, additional loan and documentation fees, appraisal, home inspections and others. Calhoun estimates another 1 percent plus $2,500 or more for additional settlement fees.

For the full list of possible costs of buying a home, see the HUD-1 Settlement Statement.