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.
Wednesday, April 1, 2009
Thursday, December 4, 2008
Mortgage Rates Drop and Another Short Sale Offer In
Mortgage rates continue to drop with actions from the Fed. This is exactly what the market needs in order to jump start the housing market. Here is the latest article on the drop in rates.
http://www.marketwatch.com/news/story/Mortgage-rates-plummet-after-Fed/story.aspx?guid=%7BABAE25EE-C9D9-4937-A8FB-E58DDD989153%7D
Offer in For a Short Sale By Santa Clara University
http://www.marketwatch.com/news/story/Mortgage-rates-plummet-after-Fed/story.aspx?guid=%7BABAE25EE-C9D9-4937-A8FB-E58DDD989153%7D
Offer in For a Short Sale By Santa Clara UniversityProof that Buyers are on the move, I just put another offer in for a short sale around the Santa Clara University area. The Townhome is way below market price even pre-1st release prices.
Mystery of Short Sales
In the initial stages of Short Sales, many banks and listing agents did not know the process on how to handle such transactions. Banks have now established short sale departments and the Real Estate industry adjusted to this new phenomenon. The trick? Lots of time and lots of patience. Submitting an offer can take as long as 2 months to get a response. Call or e-mail me today on the mystery of Short sales.
I hope everyone had a wonderful Thanksgiving!
Thursday, November 20, 2008
Sale Pending and November Market Update
Market Update
It is no secret that the economic situation continues to deteriorate. Job losses continue to be reported on a daily basis and consumers are cautiously watching their spending. Banks continue to hold onto cash and tightening on issuing of credit. Unfortunately, these activities are both needed in order to jump start the economy.
On a more micro economic level, in the Silicon Valley, there has been much more activity from real estate investors primarily on homes less than $500,000 in the conforming loan arena. Short sales and Bank Owned (REO's) are enticing investors to pick up these properties. These homes are actually competed after and bids over these low list prices are not uncommon.
The MLS now requires that when an offer has been submitted to the bank for a Short sale, the status must be change to Sale Pending even during the review period. Bank Owned (REO's) are more competitive. Banks will typically collect the offers and engage in a bidding process for the property. Of course the Bank Owned properties tend to have extremely low list prices.
My Buyer's are slowly coming out to pick up these good deals. Short Sales have been particularly attractive in the marketplace.
Sale Pending at Rivermark in Santa Clara!
Sold to the Buyers of Alan Wang, an amazing 3 bedroom, 2.5 bathrooms Townhome with 1,716 square feet of living space and a lot at 2,178 square feet in the highly desired Rivermark location. Offer in for $80,000 less than current market prices. Just a few steps to the park and the shopping center. Nicely situated, certainly a bargain.
Conclusions
Although things are grim in the marketplace, each person must make the right decisions for their families. If you are blessed enough to not be affected by the job situation and have been looking for a home, it is a great time to consider picking up a deal in the marketplace. If you are a homeowner, hold steady and if needed try to refinance any variable loans as required and plan to ride out this recession for the long run. Each person's situation will vary, please contact me if you would like a personal assessment of your real estate needs.
It is no secret that the economic situation continues to deteriorate. Job losses continue to be reported on a daily basis and consumers are cautiously watching their spending. Banks continue to hold onto cash and tightening on issuing of credit. Unfortunately, these activities are both needed in order to jump start the economy.
On a more micro economic level, in the Silicon Valley, there has been much more activity from real estate investors primarily on homes less than $500,000 in the conforming loan arena. Short sales and Bank Owned (REO's) are enticing investors to pick up these properties. These homes are actually competed after and bids over these low list prices are not uncommon.
The MLS now requires that when an offer has been submitted to the bank for a Short sale, the status must be change to Sale Pending even during the review period. Bank Owned (REO's) are more competitive. Banks will typically collect the offers and engage in a bidding process for the property. Of course the Bank Owned properties tend to have extremely low list prices.
My Buyer's are slowly coming out to pick up these good deals. Short Sales have been particularly attractive in the marketplace.
Sale Pending at Rivermark in Santa Clara!
Sold to the Buyers of Alan Wang, an amazing 3 bedroom, 2.5 bathrooms Townhome with 1,716 square feet of living space and a lot at 2,178 square feet in the highly desired Rivermark location. Offer in for $80,000 less than current market prices. Just a few steps to the park and the shopping center. Nicely situated, certainly a bargain.Conclusions
Although things are grim in the marketplace, each person must make the right decisions for their families. If you are blessed enough to not be affected by the job situation and have been looking for a home, it is a great time to consider picking up a deal in the marketplace. If you are a homeowner, hold steady and if needed try to refinance any variable loans as required and plan to ride out this recession for the long run. Each person's situation will vary, please contact me if you would like a personal assessment of your real estate needs.
Wednesday, October 29, 2008
Rate Cut of .5% to 1.25% Lending Rate
When asked for my predictions about future prospects, I often say that I don’t have a crystal ball. This has become clear when even our best and brightest such as Bernake and even Greenspan underestimated how intertwined our economies truly were, and no one in the world foresaw this crisis happening and at the magnitude that it has affected the global economy.
Why did this happen? When you sign those documents closing your home purchase, you sign a document that talks about what percentage of loans the bank you are signing with sells. The reason why Wells Fargo and Bank of America did not fall into the subprime mortgage mess is that they have followed the same high standards in qualifying their buyers and they tend to hold on to the loans that they make. It is in their best interest to qualify the right buyers for the long run. Many of the other lenders would sell a high percentage of their loans in the form of mortgage backed securities and it would no longer be their problem. This created less accountability and incentive to simply get volume. Subsequently mortgage backed securities were investments made by financial firms around the world. When it came time for these 1, 3, 5 year ARMS to be refinanced, already stretched homeowners found that home prices were not increasing, they could not refinance and even if they did, the monthlies were beyond their financial affordability.
This afternoon the fed reduced rates by half a point to 1.25% lending rate. They continue on trying to jump start consumer spending and the economy. It is yet to be seen if this will in turn lower interest rates on the loan side of the house. The concern is not the cost of money but banks that don’t want to issue loans in order to maintain liquidity.
That’s the 10,000 foot high level view, but bringing it straight down to the regular homebuyer what does this mean to us? I am seeing all types of price drops that fluctuate as much as 20% - 30% especially on bank owned properties (even higher in more questionable areas.) The main deals seem to be on condominiums and townhomes which have seen major hits. Most homeowners in the well situated neighborhoods are holding tight.
If they are selling the prices are inching down. Buyers are simply too nervous, can’t qualify and waiting for more of a drop before jumping in. If you are a home owner and have a secure job and finances, do not panic and ride out this downturn. As a homebuyer, it is time to really keep your eyes open for some great deals and if you can qualify for a loan take advantage of the low prices before other people figure this out. Recent articles have shown that home sales are rising in California, but primarily from people picking up these deals.
http://www.mercurynews.com/realestatenews/ci_10776102?nclick_check=1
Here are the most recent rates as of 10/28/2008:
Rates on 30 yr-fixed:
* Conforming - 6.375% (0 Pts)
* Conforming-Jumbo - 6.625% (0 pts)
* Jumbo - 8% with 1pt cost
If you have not already, be sure to ping me if you want me to keep an eye out for some good buys in the market for your home buying criteria. It is a great time to big up your primary home or even an investment property.
Why did this happen? When you sign those documents closing your home purchase, you sign a document that talks about what percentage of loans the bank you are signing with sells. The reason why Wells Fargo and Bank of America did not fall into the subprime mortgage mess is that they have followed the same high standards in qualifying their buyers and they tend to hold on to the loans that they make. It is in their best interest to qualify the right buyers for the long run. Many of the other lenders would sell a high percentage of their loans in the form of mortgage backed securities and it would no longer be their problem. This created less accountability and incentive to simply get volume. Subsequently mortgage backed securities were investments made by financial firms around the world. When it came time for these 1, 3, 5 year ARMS to be refinanced, already stretched homeowners found that home prices were not increasing, they could not refinance and even if they did, the monthlies were beyond their financial affordability.
This afternoon the fed reduced rates by half a point to 1.25% lending rate. They continue on trying to jump start consumer spending and the economy. It is yet to be seen if this will in turn lower interest rates on the loan side of the house. The concern is not the cost of money but banks that don’t want to issue loans in order to maintain liquidity.
That’s the 10,000 foot high level view, but bringing it straight down to the regular homebuyer what does this mean to us? I am seeing all types of price drops that fluctuate as much as 20% - 30% especially on bank owned properties (even higher in more questionable areas.) The main deals seem to be on condominiums and townhomes which have seen major hits. Most homeowners in the well situated neighborhoods are holding tight.
If they are selling the prices are inching down. Buyers are simply too nervous, can’t qualify and waiting for more of a drop before jumping in. If you are a home owner and have a secure job and finances, do not panic and ride out this downturn. As a homebuyer, it is time to really keep your eyes open for some great deals and if you can qualify for a loan take advantage of the low prices before other people figure this out. Recent articles have shown that home sales are rising in California, but primarily from people picking up these deals.
http://www.mercurynews.com/realestatenews/ci_10776102?nclick_check=1
Here are the most recent rates as of 10/28/2008:
Rates on 30 yr-fixed:
* Conforming - 6.375% (0 Pts)
* Conforming-Jumbo - 6.625% (0 pts)
* Jumbo - 8% with 1pt cost
If you have not already, be sure to ping me if you want me to keep an eye out for some good buys in the market for your home buying criteria. It is a great time to big up your primary home or even an investment property.
Tuesday, September 16, 2008
Mobile Real Estate Search
For those of you on Windows Mobile, here is the following Mobile Real Estate search sponsored by Realtor.com.
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