Q1 2012 Real Estate Update

A Big Thank You to My Clients!

First off I wanted to thank all my clients for your kind referrals and trust in my real estate services. In April I will be on my 9th year in the business, which has been fully based on your trust and referrals. I cannot thank you all enough as my clients for continuing to turn to me for all your real estate needs.

9 Year Anniversary Reflection

As I reflect on the last 8+ plus years in the business, what really drives me is being able to help people who are buying or selling the biggest assets of their lives. Most people don't buy and sell often enough, it is a daunting undertaking alone. I often get clients that work with agents that they don't necessarily trust or are having a tough time getting them to be responsive and to move quickly on their transactions. It was my own experience with an under performing agent that spurred me into this business. I wanted to build a business based on a high level of trust and integrity, guaranteed delivery on my promises, fast execution, as well as the highest levels of service as you deserve in the biggest transaction of your lives. This continues to be the case even as my business has grown, that are my foundational values that I operate on.

Keller Williams Awards

It is also with your support that I have been able to win 2 Top Agent Awards in my office; Top Agent Written Volume and Top Agent Closed Volume. It is an extreme honor as my office has over 200+ agents to be able to earn this amongst such strong performing co-workers.

Market Analysis

As I have mentioned in multiple blogs throughout the last 2 years, there is no recession in the Bay Area and Buyers are out fighting for properties. This demonstrated itself as 91% of my clients in 2011 were Buyers. 2011 showed competition in the good school districts which has always been the case, but overall reasonable opportunities with limited competition in other areas. Q1 2012 this has NOT been the case! Due to low inventory levels and a flood of Buyers in the market, there is competition at every corner. Just last week I had 4 Buyers contact me that they were interested in looking for homes.

Competitive Examples

• One of my clients offered on a 44 year old Townhome in Mountain View that had 13 offers and the winning bid was aggressive in all categories
  
• Another client offered on a Mountain View 4-Plex Bank Owned Property which had a total of 5 offers
• Another client offered on a Sunnyvale Townhome that had 3 offers

Silicon Valley the Land of Gold

Clients ask me why things are so different in the Bay Area than the rest of the country. The answer is Technology and the recent emergence of Social Media. Linkedin, Zynga and Groupon are recent IPO's that have brought equity to the valley, and most look to put these funds to purchase their first homes. With the upcoming Facebook IPO, there will be a flood of cash into the valley and Real Estate prices will sore. If you are a Buyer, I suggest moving quickly before the Facebook lockout period ends (usually 6 months after IPO). These Buyers will be paying cash and closing in 7 days and they will be tough to compete with.

Although the Bay Area is doing well, real estate continues to suffer in the rest of the country. Interest rates continue to be at their lowest rates which is also an opportunity for us in the Valley.

Recent Transactions

• 555 Crawford Drive, Sunnyvale was an off market home that sold to my Buyers
• New Townhome Development sold, let me know if you are interested, this was competitive as well
• 3 written offers lost due to overbidding by competitors

New Home Developments

There have been a few new home developments last year, however most of them are sold out. In the Spring, Summer and Fall I am tracking a few more new home developments that are in progress. Ask me about them and I can keep you in the loop once they are released.

Summary

2012 will be another low home inventory and high buying demand kind of year; where there won't be enough homes to keep up with the Buyers which means competition. I am mainly speaking of Santa Clara County close to Technology companies, but there still are pockets of opportunities. If you are a Buyer be ready to compete with other Buyers. My suggestion is find your home, follow my strategies and it will put you in the best position to win these homes. The longer you take to adjust and question the situation, the more competition you will face later on and may even end up buying a home when things are at their peak.

If you are a Seller talk to me about a Selling strategy to maximize your home value, it's a great time to sell if you have solid equity in your home.

I am looking forward to a busy buying spree in 2012 for many of my Buyers. You can trust that the strategies I have will win you the home, thank you for your trust over the years and I look forward to serving your real estate needs.

April Real Estate Update

Market Summary

It has been a turbulent time in the real estate market for every single one of us across the nation, but there could be small signs of relief. It has been a tough market for the last year and especially in the month of October. Many folks are nervous about the economy, job security and the overall situation at hand. On the real estate front I am seeing some better news to report.

In the last few weeks and there has been an uptick in buying activity; agents in my office are writing offers as well as many of my clients. A client of mine put an offer on a house that was relisted and to our surprise the home sold at list price in a very short period of time. Another investment property for a separate client had 5 offers, all of which were countered. Investors and a contingent of Buyers seem to be cautiously seeking out deals in the market place. Homes under $500,000 have been seeing competition even multiple offers and I am seeing some activity in ranges higher than $500,000 as well. These are faint indications and hardly any sign of a grand recovery. The next few months can help us gauge if this is a trend or just an outlier. If you have been on the sidelines, now maybe the time to start thinking about taking advantage of good properties in the marketplace.

An interesting article on rising home sales in February in the New York Times:
http://www.nytimes.com/2009/04/02/business/economy/02econ.html?hpw

By chance I was at my local bank and walked over to ask what the mortgage rates were for the day. In my career I have never seen my bank have rates even comparable to what my loan agents find in the marketplace. To my surprise the rate that was being offered was extremely low. Mortgage rates are at their lowest ever recorded by Freddie Mac and Fannie Mae and it shows! Call your loan agent, call a few banks and go with whichever group has the best rate for a refinance or purchase.

An interesting article in the Mercury News that these are the lowest rates every recorded:
http://www.mercurynews.com/realestatenews/ci_12005655?source=email

New Loan Breakdowns

It used to be that anything above $417,000 was considered a jumbo (and below is a conforming loan). Today there is an intermediate loan product called a jumbo conforming which handles loans between $417,000 to $729,750 which still has decent rates. Any loan amount above $729,750 is considered a jumbo loan and rates are much higher than either conforming or jumbo conforming products. Second loans are pretty much no longer in existence, the model of private mortgage insurance has returned. For those of you who have a 1st loan you do not plan to refinance, some good advice given to me was to take out an equity line of credit (while in a good job situation) which has low rates currently for emergency situations.
Check with your loan agent, accountant and financial advisor to ensure this strategy makes sense for your circumstance.

Reminder Property Tax is Due April 10th

Just a reminder that property tax in Santa Clara County is due on April 10th! There will be a penalty if you pay past this date. Go to http://www.scctax.org/ or call the County of Santa Clara at (408)808-7900.

Beware of Mortgage Foreclosure Consultants

There are legitimate Mortgage Foreclosure Consultants out there, but there have also been many fraudulent companies in these tough times. Mortgage consultants are not allowed to collect any upfront fees until services are fully rendered; this is the first and most common indication that this is a questionable company.

Long Term Investments

It is critically important to step away from the short run and focus on the long run. Any investment should be a long term investment. We have seen time and time again that the economy is cyclical but trends tend to be overall upward in the long run. Position your real estate property for the long run and ride through this turbulent time. If you have an opportunity to do so, it maybe time to buy a property at this low point, so that you can take advantage of the upside once it returns.

If you or someone you know needs Real Estate help, I will do all that I can in my power to assist them.

Latest Santa Clara County Trends

Here are the latest Santa Clara County Active and Pending trends. There is a slight leveling in active listings and a slight increase in pending listings. This is showing some activity on the buying side and a steady influx of inventory.


For a full view please click here: http://spreadsheets.google.com/pub?key=p1vgWgrdqvl3IipOutFlhcA

Interesting Statistics on Single Family Homes in Escrow

Here are the numbers for the week ending 5/10/08.

The following is considered the rule of thumb:

Buyers market if: Less than 25% of the houses in inventory are in Escrow
Sellers market if: 25% or more of the houses in inventory are in Escrow

Class 1= Single Family Homes Only as of 5/10/08:

Zone % of listings in escrow Active # of Listings
1 South County 14.1% 828
2 Santa Teresa 24.9% 139
3 Evergreen 20.5% 438
4 East Valley 16.2% 868
5 North Valley 25.1% 293
6 Milpitas 21.1% 168
8 Santa Clara 23.9% 220
9 Downtown 15.9% 360
10 Willow Glen 19.1% 233
11 South San Jose 16.9% 461
12 Blossom 24.6% 297
13 Almaden 28.6% 100
14 Cambrian 21.6% 207
15 Campbell 24.6% 153
16 Los Gatos 24.8% 155
17 Saratoga 20.9% 106
18 Cupertino 40.8% 100
19 Sunnyvale 32.0% 168

Overall % in escrow (SFR Only) is 20.4%. This percentage is up 3 tenths of a percent from last month.

Total class 1 listings as of 5/10/08 (5363) – 5/12/07 (3348) / Pending 5/10/08 (1375) - 5/12/07 (1106).

Courtesty of Fidelity Title