2nd Wave of Foreclosures!

2^nd Wave of Foreclosures???
We keep hearing that there is another large wave of bank-owned homes about to hit the market. These are all the homes that the banks have foreclosed on (or should have foreclosed on by now), but haven’t been put on the market yet. Why haven’t they been put on the market? There are a variety of reasons. First, there were all the government-imposed moratoriums mixed in with the banks imposing foreclosure moratoriums on themselves. This is similar to how there are some programs in the stock market that put a halt to trading if the market trades down by more than so many points in a day. Sort of a “cooling-off period” to prevent catastrophic panic selling. A second reason is that many of these banks are just overwhelmed and can’t keep up with the workflow to process all these foreclosures. It may sound silly, but a lot of them may be just sitting in a pile on someone’s desk, waiting for them to wade through the hundreds, if not thousands, of files they are responsible for.

The third reason is a bit more complex. It has to do with the bank’s reserve requirements from the Federal Reserve. They are supposed to keep so much cash on hand to offset their “bad” loans. Well, a lot of banks don’t have enough cash, so they are delaying foreclosing on these homes to keep their reserve account intact. If they were to take on too many foreclosures, the Federal Reserve could declare them insolvent, and take them over.

All these factors have combined to keep many bank-owned homes off the market this year, which has artificially depressed the number of homes for sale. The big question is when will they all finally get released onto the market? No one knows for sure. And now we are starting to wonder if the banks and the government are going to be able to keep finding ways to trickle the inventory out slowly, instead of in a big glut? If they have, then this IS the bottom of the market.

TAX CREDIT EXTENDED: April 30, 2010 is the new deadline for the $8,000 First Time Home Buyer (and now repeat homebuyer) Tax Credit. Click here for a video regarding how the credit works, and you can visit the website www.federalhousingtaxcredit.com to read the frequently asked questions about the credit.

Market Recap
The chart below shows that the cities east of highway 880 are losing homes at an alarming rate. Home prices have risen in these areas as much as 10% in 6 months. Demand has far outweighed supply.

For Comparison: The West side of Highway 880 is slowly picking up steam and following suit.

Current Prediction
The holiday season will not stop people from buying great deals in the area. The extension of the tax credit will continue to spur activity as well as low interest rates. Prices all across the bay area will continue to rise.

The table represents aggregated values based on MLS data for the specified date.

" Mistakes are the portals of discovery. "
* James Joyce (1882 - 1941)

* Mortgage rates were collected from publicly available sources (yahoo.com) on the date stated. The accuracy of the information and the availability of these rates are not guaranteed by the publisher. Rates are provided for informational purposes only and are subject to change without notice. Actual market interest rates may vary.

Tax Credit EXTENDED!

The Market is Fierce Out There!

Inventory Still Falling!
On Monday there were 2,790 properties on the market. This reduction in supply is challenging many of the buyers I'm working with today. One client is purchasing a single family home at $400,000 and I have written 10 offers in the past 2 months for them, and there was an average of 6 other offers on each property we wrote an offer on. Low prices, the $8,000 tax credit, and low interest rates are contributing to this surge in activity.

Short Sales Are Tough, But Getting Easier…
Since the majority of the foreclosures are being withheld from the market, the predominant type of property available to purchase is a short sale. I came across a rock solid article on short sales put together by a successful agent in Southern California titled Top 10 Home Buying Tips For Short Sales - Guide to Understanding Short Sale Foreclosure Real Estate. Anyone going through or considering a short sale should read this article.

TAX CREDIT EXTENDED: April 30, 2010 is the new deadline for the $8,000 First Time Home Buyer (and now repeat homebuyer) Tax Credit. Click here for a video regarding how the credit works, and you can visit the website http://www.federalhousingtaxcredit.com/ to read the frequently asked questions about the credit.

Market Recap
The chart below shows that the cities east of highway 880 only have 30 days of inventory where 6 months is considered a "balanced" market. Regardless of the forces, home prices will rise as it is a "supply vs. demand" economy.

For Comparison: The West side of Highway 880 is slowly picking up steam and following suit.

Current Prediction
The holiday season will not stop people from buying great deals in the area. The extension of the tax credit will continue to spur activity as well as low interest rates. Prices all across the bay area will continue to rise.

The table represents aggregated values based on MLS data for the specified date.

Enjoy the rest of your week and as always I welcome referrals from friends, co-workers or family members looking to buy a piece of property.  I am also happy to provide sound unbiased advice at any time. You can rely on my integrity and follow-through.

"Before God we are all equally wise – and equally foolish."
* Albert Einstein (1879 - 1955)

Silicon Valley, Unlike the Rest of the Nation

Silicon Valley, Unlike the Rest of the Nation:

Inventory Continues to Fall!
In May of 2008 Santa Clara County had 7,384 properties on the market, the highest in years! Today there are 3,060 properties on the market, less than half of May 2008.  The chart below shows the decline in inventory and its effect on price and days to sale.

In the past 30 days I have presented 12 offers on properties valued between $150,000 and $525,000.  When compared to the rest of the nation, Silicon Valley has a completely different climate.   This article from MSNBC  helps to explain why http://www.msnbc.msn.com/id/32970895/ns/business-forbescom/

FHA Loans Getting Tougher…

Low interest rates through government funded loans are a leading cause to this surge in activity. Shashank Shekhar, a premier lender of FHA loans, explains the challenges right around the corner for people looking to qualify for FHA loans. http://lendingexpertblog.com/blogs/?p=595

REMINDER: November 30th is the Deadline for the $8,000 First Time Home Buyer Tax Credit. Lobbyists are trying to extend that deadline but there is no guarantee. Click here to learn more.

Market ReCap
The chart below shows how cities east of highway 880 have been consistently losing inventory over the past year and a half. What this means is that home prices will rise as it is a “supply vs. demand” economy.

For Comparison: The West side of Highway 880 has not seen as dramatic of a change.

Current Prediction
Fewer properties will be coming on the market through the end of 2009. Buyers will continue to receive great deals due to the threat of rising interest rates and losing out on the $8,000 tax credit.  These factors will play a larger role than the threat of prices going down, thus continuing to drive prices up.

The table represents aggregated values based on MLS data for the specified date.

Enjoy the rest of your week and as always I welcome referrals from friends, co-workers or family members looking to buy a piece of property.  I am also happy to provide sound unbiased advice at any time. You can rely on my integrity and follow-through.

"Dreams come true. Without that possibility, nature would not incite us to have them."
* John Updike (1932 - 2009)

Santa Clara County Prices are on the Rise!

Prices are On the Rise!
After years of county-wide depreciation, home prices are finally rising.  The rise in price is an indirect correlation with days on market, signaling that prices are on the up and up.

The real estate market is soaring! We have had a surge of activity in homes priced below $500K.  Looks like we hit rock bottom about 6 months ago, further evidence that the market is on the way up.

Zillow Falls Short Again…

Many buyers and sellers have been raving about Zillow and their appraisal services.  I spoke to my real estate appraiser about Zillow to test the accuracy of their claims. Here are his research findings. He found out that Zillow is off by an average of 11.9%, or $82,348!  Always remember to use a trusted adviser when making financial decisions.

Inventory has dropped 500 homes/mo. for the past 5 months.

November 30^th is the Deadline for $8,000 First Time Home Buyer Tax Credit. Click here to learn more.

SOLD!
I sold the large 2 bedroom 2.5 bathroom townhouse priced at $419,000 near Santana Row. Check it out at http://www.485quailbush.com/.

Market ReCap
Average sales price for the Santa Clara County was at $692K for the month of August! Time on the market is shortening rapidly, this signals multiple offers. Below is the chart of sales in all cities East of Highway 880. If you look closely you will find 13 consecutive months (OVER A FULL YEAR) of demand exceeding supply. The market in the county is running strong, and the time to buy is now!

For Comparison: Again sales West of Highway 880 exceed new listings.

Current Prediction
Fewer properties will be coming on the market through the end of 2009. Buyers will continue to receive great deals due to the threat of rising interest rates and losing out on the $8,000 tax credit.  These factors will play a larger role than the threat of prices going down, continuing to drive prices up.

The table represents aggregated values based on MLS data for the specified date.

Enjoy the rest of your week and as always I welcome referrals from friends, co-workers or family members looking to buy a piece of property.  I am also happy to provide sound unbiased advice at any time. You can rely on my integrity and follow-through.

"Mistakes are the portals of discovery."
* James Joyce (1882 - 1941)

Property Tax Reduction Deadline!

Did Your Home Drop in Value? Do You Need Help With Getting it Re-Assessed?
I am currently helping people contact the Santa Clara County Assessor’s Office to get their property value re-assessed to reduce their property taxes for 2010. If you would like some help, please contact me ASAP. The deadline is in 4 DAYS - August 15, 2009.

For Sale!
Large 2 bedroom 2.5 bathroom townhouse for sale priced at $419,000 with an attached garage just minutes from Santana Row. Check it out at http://www.485quailbush.com/ and see all the disclosures, inspections, virtual tour and an abundance of photos. This place is amazing!

Santa Clara County Bidding Wars Are Back
Who turned up the heat?? According to Pete Carey of the Mercury News the Santa Clara County bidding wars are back. The recent Monday article explains exactly how tough it is out there for buyers. The full article can be found here http://www.mercurynews.com/ci_13028660?source=most_emailed. I normally do not agree with the facts that the media produces, but in this instance, they were on the mark. After pondering it for a while, I realized I agreed because they used local Realtors to give local reports. Buyers in Santa Clara County do not care what is affecting buyers in Wyoming, or any other “National” statistic. Real estate is bought and sold locally. It needs to be addressed and analyzed on the local level.

Attention First Time Home Buyers
Incentives for buyers are going on right now! Are you aware that first time buyers* who purchase in 2009 might qualify for an $8,000 tax refund from the government? Click here to learn more.

• County-wide inventory has dropped 500 homes/mo. for the past 4 months.
• Purchasing has become tougher because of all cash offers.
• Prices are rising! Areas that saw the largest declines are posting higher dollar values.
• Rates might rise 1% in Q1 of 2010.
• $8,000 buyer tax refund is not well-known by buyers.

Market ReCap
Median list price for homes below $1M has hit $600K! Time on the market is shortening again, which is a sign of multiple offers. Below is the updated chart of sales in all cities East of Highway 880. Now we have seen 12 consecutive months (1 FULL YEAR) of demand exceeding supply. If the graph below does not appear click here to view it.

For Comparison: Here is the exact same chart for cities West of Highway 880, and we see struggling home sales. If the graph below does not appear click here to view it.

Current Prediction
Fewer properties will be coming on the market through the end of 2009. Buyers will continue to receive great deals and the threat of rising interest rates and losing out on the $8,000 tax credit will be playing a larger role than the threat of prices going down.

The table represents aggregated values based on MLS data for the specified date.

Enjoy the rest of your week and if you know of a friend, co-worker or family member who really wants to buy a piece of property and needs some sound unbiased advice let me know. You can count on me to provide it.

"I respect faith, but doubt is what gets you an education."
* Wilson Mizner (1876 - 1933)

* Mortgage rates were collected from publicly available sources (yahoo.com) on the date stated. The accuracy of the information and the availability of these rates are not guaranteed by the publisher. Rates are provided for informational purposes only and are subject to change without notice. Actual market interest rates may vary.

Mid Year Market Update

I hope you had a safe and memorable July 4^th! In Santa Clara County there was not a cloud in the sky which made the conditions optimal for viewing fireworks. As a comparison, inventory in Santa Clara County is continuing to fall, which is making the conditions optimal for rising prices! - Is it seasonal? YES. Are there still multiple offers? YES. Is the market still recovering? YES. Is 2009 going to be a great time to buy? YES.

Were you aware that first time buyers* who purchase in 2009 might qualify for an $8,000 tax refund from the government? Click here to learn more.

I recently went to a very informative presentation where Carole Rodoni spoke about the current housing economy and where we are headed. She is a highly regarded speaker, author and advisor in the Bay Area Real Estate Industry. She is a former President of Fox & Carskadon Realtors, COO of Cornish and Carey Real Estate, President and COO of Alain Pinel Realtors, and now the President of her own consulting firm, Bamboo Consulting. She writes for The Wall Street Journal and shares her experience and knowledge with Realtors, Brokers and Managers all over the Bay Area and State. A few points I left with are:

· Recession till 2010 but getting better the whole time.
· All the new lending guidelines are to keep values stable.
· 90% of real estate value is in the land. Areas of limited land will rise the fastest.
· Rates are lowest in 38 years. Might be up .5% in Q1 of 2010.
· $8,000 buyer tax refund is not well known by buyers.

She will be speaking again on Thursday July 16^th from 9:15 AM -11:30 AM at the Santa Clara Convention Center, Meeting Room 206, 5001 Great America Parkway, Santa Clara, CA. I highly recommend you attend if you are considering purchasing property in the next 12 months. You need to RSVP so please contact me and I can put you on the list, or you can click here for the invitation.

Previous Prediction: Expect prices to begin to rise! Well priced properties will sell quickly, and with multiple offers. Interest rates will play a role in buying power and prices, although not as much as it has in the past.

Recap: Median list price for homes below $1M has hit $600K! Time on the market is shortening again, which is a sign of multiple offers. Below is the updated chart of sales in all cities East of Highway 880. Now we have seen 11 consecutive months of demand exceeding supply.
For Comparison: Here is the exact same chart for cities West of Highway 880, and for the 2^nd time in 30 months demand has exceeded supply!

Current Prediction: Fewer properties will be coming on the market through the end of 2009. Buyers are going to continue to receive great deals and the threat of rising interest rates will be playing a larger role than the threat of prices going down.
"Destiny is no matter of chance. It is a matter of choice. It is not a thing to be waited for, it is a thing to be achieved."
* William Jennings Bryan (1860 - 1925)
Enjoy the rest of your week and if you know of a friend, co-worker or family member who really wants to buy a piece of property and needs some sound unbiased advice let me know. You can count on me to provide it.

The table represents aggregated values based on MLS data for the specified date.

Market Update & I Sold it in 6 Days!

Another month has passed and the trends are continuing. At my most recent office meeting we discussed tactics we can use to help our clients get their offers accepted in multiple offer situations because, believe it or not, that is the kind of market we are in. The property I put on the market in mid May, www.6430bancroft.com SOLD WITH 22 OFFERS IN 6 DAYS OVER $150,000 ABOVE ASKING!! I want to talk to the person who thinks this real estate market is “dead” and ask them where exactly they think it’s dead and where they are getting their information.

In the month of May Santa Clara County saw 1,091 homes sell. In May of 2008 we had a similar number of properties sell, but the difference lied in the total inventory level. There were 7,384 homes to purchase in the county last year compared with only 4,719 available this May. Our supply of homes has dropped by about 37% over the past 12 months! Basic supply and demand principles will say that prices need to rise, and they have. Over the past 2 months the median home price has gone up 12%. As a word of caution, in the past 2 weeks mortgage interest rates have gone up over a full percent. This will reduce average buying power by about $30,000. Waiting to purchase a home might backfire if interest rates continue to rise as you will not be able to afford the home even if prices drop.

Previous Prediction: Inventory is going to continue to fall, as long as interest rates stay low enough. Well priced properties in any market will see activity.

Recap: This month the median price for homes below $1M in the county have risen by nearly 9%. Time on the market has stayed the same. Below is the updated chart of sales in all cities East of Highway 880. Now we have seen 10 consecutive months of demand exceeding supply.

For Comparison: Here is the exact same chart for cities West of Highway 880, and for the first time in 29 months demand has exceeded supply!
Current Prediction: Expect prices to begin to rise! Well priced properties will sell quickly, and with multiple offers. Interest rates will play a role in buying power and prices, although not as much as it has in the past.

What’s driving this market:
· Interest rates are still historically very low!!!
· Buyers are getting concerned that the competition is going to be too high now that signs of economic recovery are in the midst
· More banks are using “short sale negotiators” to help get those short sales sold
"Do not anticipate trouble, or worry about what may never happen. Keep in the sunlight."
* Benjamin Franklin (1706 - 1790)
Enjoy the rest of your week and if you know of a friend, co-worker or family member who really wants to buy a piece of property and needs some sound advice let me know. You can count on me to provide it.

The table represents aggregated values based on MLS data for the specified date.

Housing Market Update and Just Listed!

The real estate economy doesn’t care about Swine Flu! Last Saturday I planned to show a buyer 7 properties, and upon further investigation, one had 4 offers, another had 15 offers, and yet another had over 30 offers. The trends that I watch on a weekly basis support this. Santa Clara County had 580 homes come off the market and go sale pending last week. We haven’t seen a number that high since May of 2005, and we all remember what was happening at that time, multiple offers resulting in major amounts of appreciation. Below is my previous prediction from April. Also, please pay attention to the market stats I have posted!! 3 of the 4 data points I follow are on the rise - home prices are rising!

I just listed a 5 bed 4.5 bath home for sale this morning for $1,149,000 in Cupertino. Click on http://www.6430bancroft.com/ to see more about this great home. In 3 hours I received 3 emails and 4 phone calls requesting more information about the home. The activity is really high, even in the higher price ranges, when the home is priced well. If you want to see this home I will be holding it open this Sunday from 1:30 to 4:30. If you find yourself in the neighborhood stop in and say “Hi”.

Previous Prediction: The buying trend is going to continue, as long as interest rates stay as low as they do. Properties below 650K are going to see many many more offers and even the ugliest ones will start to get purchased.

Recap: The market has changed. This month the median price for homes below $1M in the county have risen by over 4%. Time on the market has continued to shorten. Below is the updated chart of sales in all cities East of Highway 880. Now we have seen 9 consecutive months of demand exceeding supply.

For Comparison: Here is the exact same chart for cities West of Highway 880.

Current Prediction: Inventory is going to continue to fall, as long as interest rates stay as low as they do. Well priced properties in the higher priced markets are now going to begin to see more activity.

What’s driving the markets:

· Interest rates are at 40 year lows!!!
· Buyers are getting concerned that the competition is going to be too high now that signs of economic recovery are in the midst
· Majority of short sales have now become “Bank Owned” which are much easier properties to purchase
· Dow Jones Industrial Average has risen about 2000 points to 8,500, which is bringing back people’s down payments

Scared to buy because you fear losing your job? Consider this:

1. You always have to have a place to live.
2. Even if you are laid off, you will still have to pay rent.
3. If you miss one rent payment, you may be evicted.
4. If you are evicted, you may not be able to easily rent again.
5. If you miss 1, 2, 3 or more mortgage payments, you still stay in the house.
6. If you are laid off and get another job, you can pay the missed mortgage payments.
7. If you use your saving to pay for rent, it’s lost money you’ll never get back.
8. If you use your saving to pay mortgage, you continue to build equity.
9. Most likely you will not qualify for a loan after layoff with no income.
10. It may be difficult to qualify for a mortgage when you get new job.
11. Mortgage interest and property taxes are usually deductable, so it may be same as rent.
12. Rent usually increases every year. Mortgage payments stay the same for 30 years if a fixed loan. Even if current mortgage payment is higher than rent, most likely the future rent increases will catch up to mortgage payments, and eventually may be higher.
13. You can borrow against equity built up.
14. Increases your net worth.
15. Future long term appreciation of home.
16. You are in control of where you live. Landlord cannot give you 30 day notice to move.
17. Quality of life will be at its highest point when you own. You may make any changes to your home with minimum restrictions.
18. Pet owners may have any legal pet without restrictions.

" You have to have confidence in your ability, and then be tough enough to follow through."
Rosalynn Carter (1927 -)
Enjoy the rest of your week and if you know of a friend, co-worker or family member who really wants to buy a piece of property and needs some sound advice let me know. You can count on me to provide it.

The table represents aggregated values based on MLS data for the specified date.

Urgent Housing Market News!

The first quarter of 2009 has come to a close and the low end of the real estate market is on fire! I took a survey of my agents who wrote offers in the past 14 days, and of the last 25 properties they wrote offers on 20 had multiple offers, and of those the average number of offers was 5!!! Below is my previous prediction which I stated back in January. Also, please pay attention to the market stats I have posted!! The median home and average home prices across the county have risen! Prices west of 880 are on the way up!

Previous Prediction: The lowest priced homes east of 880 are going to continue to see multiple offers, and the properties west of 880 will see prices continue to be stable or drop slightly (1-5%)

Recap: The shift has already begun. The median price for homes below $1M in the county has risen by over 2%, which means more people are buying than selling. Time on the market is shortening, not much, but it is shortening. Below is a chart of sales in all cities East of Highway 880. We have seen 8 consecutive months of demand exceeding supply.
For Comparison: Here is the exact same chart for cities West of Highway 880.
Current Prediction: The buying trend is going to continue, as long as interest rates stay as low as they do. Properties below 650K are going to see many many more offers and even the ugliest ones will start to get purchased.

What’s driving the markets:
· Interest rates are at 40 year lows!!!
· Fewer sellers are putting their homes on the market because they are “modifying” their home loan instead of selling
· Majority of short sales have now become “Bank Owned” which are much easier properties to purchase
· New president is showing hope that a recovery is in sight

The housing stats I’ve reviewed are showing that some parts of the market will not let prices go any lower. Every time we have multiple offers there are buyers left looking for something else to purchase. Regardless of what the news says, houses are selling, and we might continue to see more demand than supply. Buyers in this market not facing a multiple offer situation can negotiate great deals and if you are purchasing for the long term, now is a great time to purchase when prices are low and interest rates are desirable. For each rise in interest rate by 1% your affordability drops by 10%. Beware of waiting for prices to drop only to be priced out by the rising interest rates.

"True luck consists not in holding the best of the cards at the table; luckiest is he who knows just when to rise and go home."
John Hay (1838 - 1905)
Enjoy the rest of your week and if you know of a friend, co-worker or family member who really wants to buy a piece of property and needs some sound advice let me know. You can count on me to provide it.

The table represents aggregated values based on MLS data for the specified date.

Housing Market Update for 2009!

Happy 2009! Have you been able to maintain those resolutions? Are you thinking that 2009 is the year we get out from this hole we have found ourselves in? I sure am!

Previous Prediction: I’m expecting a huge rush of people buying in January and February because of the government dropping mortgage rates.

Recap: The lowest priced homes east of 880 are seeing multiple offers and selling. I bid on a property with 40 offers on it valued at 450K. Properties west of 880 are still taking some time to sell. Below is a chart of sales in the Blossom Valley area.
Current Prediction: The lowest priced homes east of 880 are going to continue to see multiple offers, and the properties west of 880 will see prices continue to be stable or drop slightly (1-5%)

What’s driving the markets:
· Interest rates are at 40 year lows!!!
· Fewer sellers are putting their homes on the market
· Majority of short sales have now become “Bank Owned” which are much easier properties to purchase
· New president is showing hope that a recovery is in sight

The housing stats I’ve reviewed are showing that some parts of the market will not let prices go any lower. When 40 bids come in on a single property, there are 39 buyers who didn’t buy. Thos buyers are still out there ready to buy. Regardless of what the biased media is telling us, houses are selling, and we might be seeing more demand than supply. Buyers in this market not facing a multiple offer situation can negotiate great deals and if you are purchasing for the long term, now is a great time to purchase when prices are low and interest rates are desirable. For each rise in interest rate by 1% your affordability drops by 10%. Beware of waiting for prices to drop only to be priced out by the rising interest rates.

"The key to realizing a dream is to focus not on success but significance - and then even the small steps and little victories along your path will take on greater meaning."
* Oprah Winfrey (1954 - )
Enjoy the rest of your week and if you know of a friend, co-worker, family member or even a stranger who really wants to buy a piece of property and needs some motivation, or accountability, let me know. I’ll be sure to help them get what they want.

The table represents aggregated values based on MLS data for the specified date.