The recently concluded meeting of the Federal Reserve Board has confirmed the expected policy changes regarding Mortgage Backed Securities. The following video discusses what these policy changes are and what affect they will have on interest rates. We are seeing many buyers and sellers of Danville real estate, San Ramon real estate, Alamo real estate, and people transacting real estate deals throughout the entire Bay Area now benefiting from the current mortgage market and this video will give you our perspective on what the market will look like in the near future.
January 2010
What has changed over the last few weeks with the the market for single family detached homes in San Ramon? Not Much!
We had seen the inventory absorption rate for San Ramon real estate drop to .3 months at the first week of January and as of today we are at .38 months which is virtually unchanged. But what we are seeing is prices increase. The median home price for Contra Costa County has increased 3 months in a row and is now 13.9% higher than the same time last year. So the question is why. I believe that there are a few major reasons for the increase in prices. The first being low inventory numbers. We have seen the inventory of single family detached homes drop to a point where we are only at 35% of where we were just 1 year ago. The second reason for prices rising is that interest rates continue to be very low. This is acting has a great incentive for home buyers and we are seeing more buyers staying engaged with the market. The third reason for price increases is the First Time Home Buyer Tax Credit. While this is not the main reason people are buying, it does provide a way for some who would normally not be able to buy. So in summary we have low inventory and more buyers. The economic law of Supply Vs. Demand comes into play and prices go up.
Current San Ramon Real Estate Statistics:
There are 58 active single family detached homes on the market in San Ramon. The average list price for these homes is $1,031,014 with the highest priced listing at $4,990,000 and the lowest at $345,000. The average price per square foot is at $422 and the average days on market at 77. There are 152 pending sales for San Ramon real estate with an average list price of $773,154. The highest priced pending sale is listed at $1,773,695 and the lowest at $365. The average price per square foot is at $294 and the average days on market of 34 days.
The following Oakland Tribune article discusses the Bay Area residential real estate market and the fact the home prices, and in most counties sales as a whole, have increased 3 months in a row and the median price is over 15% higher than last year. For Danville real estate, San Ramon real estate, and Alamo real estate, we have seen the same trend with the only difference that sales actually dropped. The reason for lower sales is that inventory is extremely low and while sales are down it is more a factor of low inventory than a sign of low activity. Buyers and Sellers alike are actively engaged in this market and we are seeing this trend continue into the new year. I would love to see your comments regarding this article.
The real estate market in the East Bay Area of California and specifically Danville Real Estate, San Ramon Real Estate, and Alamo Real Estate we are seeing a market that is still very similar to the Q4/2009 market. With low inventory, low number of foreclosures and short sales, and low interest rates we are seeing a strong sellers market at the lower price points. The following video offers some very helpful information for both sellers and buyers in todays market. Please take a look and feel free to share this link with anyone you know who is interested in today’s market.
The Danville Real Estate market for single family detached homes is still strong and boasts an inventory absorption rate of 1.24 months.
The inventory absorption rate is almost identical to where it was at my last Danville Real Estate posting on January 5. We have seen the number of active listings creep up a bit but so have the number of Pending sales. While there are many short sales in the Pending category we have had 8 closing sales during the month of January. I put together a video of my projections for the year and I have not seen anything yet that would cause me to revise these projections.
Current Danville Real Estate Statistics:
There are currently 98 active single family detached homes on the market in Danville. The average list price for these homes is $1,261,754 with the highest priced listing at $3,994,000 and the lowest at $475,200. The average price per square foot is at $428 and the average days on market at 105 days. There are 79 Pending sales in Danville with an average list price of $897,357. The highest priced pending sales is listed at $2,395,000 and the lowest at $449,000. The average price per square foot for these sales is at $322 and the average days on market at 62 days. There have been 8 closed sales of single family detached homes in Danville during the month of January. The average sales price for these homes is $1,072,000 with the highest listed at $1,575,000 and the lowest at $635,000.
The attached Contra Costa Times article details the facts around an $11 million dollar fund to be used for buying foreclosed and abandoned homes, refurbishing and in some cases renting these Alameda county homes to low income families. Currently there is no program like this in Contra Costa County but I suspect there may be
soon. While I don’t believe that it will have much of an impact on the communities of and values for Danville real estate, San Ramon real estate, or Alamo real estate, I do believe that the person’s administering this program must take great care in selecting the homes to be part of the leasing program in order to not have a negative affect on home values in the area. I would love to hear your comments and thoughts.
County gets $11 million to help neighborhoods – ContraCostaTimes.com.
The recent respa changes now require a more comprehensive Good Faith Estimate be provided to the buyer prior to the close of escrow. This new Good Faith Estimate will require both your lender and Real Estate Agent to be accountable for errors on the estimate. It will require you to provide more information more frequently. The objective is to remove any hidden or undisclosed fees from the buyer. Buying Danville real estate, San Ramon Real Estate, Alamo Real Estate, or any East Bay property should be more transparent at the close of escrow. Feel free to share this important information with friends or anyone that it can benefit.
KB Homes Posts it’s First Quarterly Profit since 2007, What does This Meen for East Bay Real Estate?
The following Contra Costa Times article reports that KB homes reported a profit for Q3 2009. The article seems to give a mixed signal though. While profits were up actual new housing starts were down and it looks as if the profit is mainly as a result of an accounting rule. This is more indication that the market seems to be very tenuous and only time will tell how it plays out. For Danville real estate, San Ramon real estate, and Alamo real estate we have seen a definite turn around from last years market and unless we see a avalanche of foreclosures and short sales I predict that the 2010 market will be similar to our market in Q4/2009.
California builder KB Home posts first quarterly profit since 2007 – ContraCostaTimes.com.
The 2010 residential real estate market has the potential to be quite volitile, however, I expect that for the most part it will resemble Q4 2009. For Danville real estate, San Ramon real estate, and Alamo real estate we saw the market change dramatically over 2009 and end up with a sellers market for homes under $850,000, a buyers market for homes priced between $900,000 and $1,300,000; and a neutral market for the higher end homes. While I believe the projections in this video to be accurate, I also want to disclose that much can change if the policy makers decide to release large numbers of foreclosures to the market or if the Fed radically changes it’s policies and interest rates rise substantially. It is also uncertain how much the elimination First Time Home Buyer tax Credit in April will effect home sales.
The following Los Angeles Times article proposes a suggestion that it is in a homeowners “Best Interest” to walk away from a home that has negative equity, even if the homeowner can still afford the payments. Within the East Bay communities of Danville, Alamo, and San Ramon we are seeing many home owners who may be in distress just simply stop making mortgage payments. One thing is for certain Inventory levels for single family detached homes is very low. I personally feel that homeowners should really consider all option prior to just walking away. These option include performing a “Deed in Lieu” or a “Short Sale“. Just walking away and basically creating an eyesore for your neighbors seems irresponsible to me.
Will walking away from a mortgage go mainstream? | Money & Company | Los Angeles Times.
