9/8/08 It's Time to Buy If you missed the recent article by Contra Costa's Assessor Gus Kramer, you missed a very clear call to action. His quote says it all, "As the assessor of Contra Costa county since 1995 and a student of the real estate market of the East Bay since 1971, I've never felt more compelled and stronger about advising anyone and everyone who ever thought about getting into the real estate market to do it now." The assessor does say that prices will still go down a little lower until the end of 2008, notwithstanding he feels purchasing now is a must. He points out what we have always said…...you can't time the bottom. Investment property, specifically newer single family homes, in parts of Contra Costa and San Joaquin are selling at discounts of up to 50% to there original purchase prices. These are tract homes built within the last 10 years. Savvy real estate investors are seeing the return of cash flow investing. Rental rates have slowly advanced while property values, especially in outlying counties, have plummeted. This is the most attractive investor market we have ever experienced ! The Local Livermore Market On a year to year basis our local market has been performing impressively if you just look at the numbers. Active listings are down 21% while pending sale are up a stunning 83% over this time last year. Now, of course, when we break it down we see a the bulk of sales activity in the entry & mid tier price points with many of the those transactions bank owned and short sales.Our high end market continues to struggle. There are 66 listings priced at $1million or more in Livermore. There are only 5 pending sales in this price range. Clearly we have an investor and first time buyer driven market! The move up buyer is still holding back! Larry & Kathleen
April 08 This week in real estate? There is a light at the end of the tunnel. And that light is shining brighter and brighter.
Well after a week of some very interesting headlines, I am pleased to report, things are looking better for our profession. We are finally seeing signs of life from industry analysts, journalists and economists who after a long, pessimistic stint, are finally coming around to reveal the reality that real estate is and remains a good, solid, long-term investment and that buyers who enter the market right now, will probably be getting in on the best chance to own a slice of the Golden State in more than 15 years.
Just look at what some of these online stories had to say: http://activerain.com/blogsview/483329/Recent-Quotes-about-the http://realtytimes.com/rtpages/20080418_realtyviewpoint.htm
Buyers are in the perfect position right now. And those smart investors who know that you make money when you buy, are scanning the market for bargains. Sellers who prosper will ensure that their home is viewed as a value by potential bargain hunting buyers. This can be done with a skillful combination of home merchandising and competitive pricing. And once the two meet, the deals will flourish.
Based on what we're seeing in our local offices, April is shaping up to be one of our best months in at least a year. After a relatively slow first quarter, here is what we're seeing in the market today:
Increase in Multiple Offers: The trend of multiple offers is continuing to leave its impression on our Spring market. Some of the most prominent areas enjoying the benefits of multiple offers are: San Francisco, reporting 15 multiple offers last week; Menlo Park with six multiple offers, one of which received 10 offers; Palo Alto with four multiple offers; and several parts of our more affordable, outlying areas like Santa Rosa, with eight offers.
Yes, part of this trend is based on seasonality but part is also based on a new public perception that there is value and buyers are starting to take action.
One challenge several of our markets are facing right now is the increase in defaults, largely due to financing problems, buyer cold feet, or, in the case of REOs and bank-owned properties, difficulty in negotiating. While there can be value in REOs and bank-owned properties, buyers do need to be made aware of the pitfalls and challenges they will be facing when negotiating prior to making offers.
In closing, our message remains, it's a good time to buy. Yes, there are challenges in the economy. Yes, oil prices are high. But the combination of low interest rates, attractive inventory and motivated sellers, simply can't be beat.
Have a great week, Larry & Kathleen
Feb. 26, 2008
Economic news was sketchy again this week, with housing related headlines continuing to point out the scary negatives. Fortunately, we continue to see a surprising amount of interest from buyers who are finally deciding to take the plunge. Really, the deals that are out there are getting to be irresistible, and with mortgage rates starting to creep back up, buyers are recognizing that now really just may be the best time to buy. Sales are increasing in some areas, and it is perhaps the passing of the economic stimulus package that is spurring these buyers into bringing their checkbooks with them when they're looking at properties. If not the passing of the package itself, it is the added degree of consumer confidence that came as a result of it. Buyers are also being properly educated by the real estate industry and doing their research, not just being scared by skewed headlines. Now they're jumping in while the deals are out there. We are also starting to see homes that have been on the market for quite awhile starting to get some interest. It is all about being the best price and condition in your class of property. First time buyers are also finding affordable, desirable homes in lower price ranges and through REO sales and they're buying them.
In Sonoma county we continue to see improved sales activity especially in the lower price ranges and on REO properties. Marin county sales are continuing to improve from January levels as well. In San Francisco , as in other parts of the Bay Area, the high end market remains particularly strong with homes well over the $1 million mark in high demand. A Burlingame property had seven offers and sold for $125,000 over the listing price. Parts of the Peninsula keep seeing this phenomenon occurring, but other sub markets still languish. In Southern Alameda County we have a mixed bag with parts of Pleasanton and Fremont attracting motivated buyers while entry level interest in Livermore still anemic. Like never before, markets differ from one city to another and in some markets foreclosure pricing is driving the market. It's worth keeping in mind that many of these off-market sales aren't included in sales figures collected and reported by the media. Everything isn't as bleak as some would have us all believe. We are certainly seeing what I would call a split market with the high end doing well, and with the median priced homes slowing their price dive.
1/24/08
The New Year seems to be starting off with a bang! Yes - the headlines continue spouting the latest "factoids" about the implosion of the housing market from whatever company is cranking out the latest set of numbers. However, buyers may have reached the tipping point and seem to realize that the only way to find out if they can get the best deal on the home of their dreams is to TRY. And they're out in full force doing just that in most of our markets. Is it a sea change? It's too early too tell, but it is motivating to know that both buyers and sellers seem more willing to listen to their real estate professionals now, and are putting less faith in Ivory Tower economists who don't live in the Bay Area or understand the nuances and intricacies of our housing markets.
Over and over, our offices are reporting listings and open houses that are buzzing with activity. Two agents in our office report that they encountered multiple offer situations when trying to present $1M + offers just this past weekend. We have witnessed similar scenarios in our South Livermore-Pleasanton Market. In most local markets agents report that they are very surprised at the excellent turn out and open enthusiasm of open house attendees. Buyers appear serious for the first time in a long time.
It's pleasant to report that not only are buyers out there looking - they're also buying. It's been said many times before, but it bears reminding everyone that proper and smart pricing of a home is truly key to entering into a speedy sale.Inventory, priced right, is getting a lot of attention. If it's not, it's not.
The strength of the high-end and luxury market is especially noteworthy. The lack of fresh inventory on the Peninsula appears to be the only significant drag on that sub-market. We are off and running for the New Year and buyers seem to be ready willing and able to seize the moment....at least so far!
Larry & Kathleen . 1/8/08 The New Year is here and with it brings countless predictions by economists, industry analysts and more regarding the impending 2008 real estate market. While we don't profess to own a crystal ball, what we can say with definite certainty is that the current market won't last forever which is why we're here to tell you that 2008 may be your best opportunity to own a slice of the Golden State.
What You May Expect from Real Estate in 2008.... Some industry analysts predict that the market will turn around in 2008 believing that the overall economy and job growth will continue to move ahead at a decent pace, core inflation will remain under control, the credit crunch in mortgage markets is showing signs of easing, the supply-demand equation will be better balanced as builders begin to whittle down their excess inventories and that interest rates will continue to be attractive.
We tend to agree with the California Association of Realtors®' prediction that we will see a moderate decline (between three and four percent) statewide in California home prices next year.
In areas where there is little new housing, where it is hard to build and where there is a wealthy population,we believe there may be little decline. The main reason is that there is limited opportunity for new development in these areas and therefore properties are likely to retain their values.
For Buyers The current housing market offers a unique window of opportunity for confident buyers. The exciting news is that for the first time in quite a while, the stars are in alignment for consumers: mortgage rates remain attractive and there is a large selection of homes to choose from. Furthermore, if history is any indicator, home prices in California remain strong. Thanks to these important factors, now truly may be the best time to buy.
For Sellers Homes are selling! They may not be selling at the red hot, multiple offer heydays of 2003 and 2004, but they definitely are selling. For those that aren't, unfortunately those sellers may not be receiving the counsel they need to get their home sold in today's market.
Now, possibly more so than ever, you need a qualified, experienced Realtor® who can assist you in selling your home. It is usually not enough to simply post your home on the MLS and post a "For Sale" sign in the yard. You need someone who understands the intricacies, inventory and challenges of your local market and someone who knows how to properly position your home so it stands out among the sea of listings currently available.
If you are considering buying or selling your home in 2008,we have the resources, knowledge and experience to properly represent you in today's market. Contact us today for the expert representation you deserve.
Sincerely, Larry & Kathleen
12/18/07 From Castro Valley to San Francisco , Menlo Park to Livermore and Walnut Creek , we're hearing that buyer activity is surprisingly busy for this traditionally slower time of year. In some areas, this can be attributed partly to the great selection of value-priced homes on the market. It can also be attributed to the fact that there are fewer buyers and fewer sellers around during the holiday season - and the ones that are in the market are very serious about buying or selling a home as quickly as possible. Negotiations between buyers and sellers still remain fierce in many areas - one of our office reports that up to five and six counter offers are not uncommon before a deal can be closed. Attendance at open houses was as scattered as our micro-markets are. Sebastopol reports light attendance at opens, but lots of sales activity on properties near $1 million and over - a fact illustrated by a five acre property with a small farmhouse that was listed at $850,000, received seven offers and sold for almost $1 million. Buyers haven't slowed down in the Peninsula housing market either. Menlo Park reports that many agents are as busy now as they usually are during more traditionally busy months, and that open houses were "surprisingly well attended." One listing in Palo Alto had 10 offers and was ratified at approximately 20% over the asking price. "Above average" to brisk open house attendance is also being seen in Half Moon Bay and San Francisco . A large majority of Coldwell Banker offices reported steady or increasing sales activity, while listing inventory in our markets saw mostly steady or declining levels. While inventory remains high and sellers are willing to negotiate some great deals, now may be the best time to buy.
11/27/07 Amidst the ever present negative news about foreclosures, notices of default and write downs from Merrill Lynch & Citibank....guess what? Fixed mortgage interest rates are at their lowest level in two years. Yes, you heard it here first. The Federal Reserve is loosening the money flow. Lenders are working with defaulting borrowers to modify their mortgage terms. Congress is trying to pass a legislation raising the conforming loan limit to $622,000 (from $417,000) in California. The forces are in place to stimulate the real estate market. It's just a matter of when the impacts will be felt.
11/16/07
The markets continue to be mixed throughout the bay area region. Well priced properties in great condition are selling and we are seeing a few multiple offer situations in areas with low inventories. The question is, what is well priced? Remember, real estate prices are heavily influenced by supply and demand. Sellers need to understand this now more than ever. It is confusing to see some areas with little to no available inventory and just a few towns away there can be an oversupply. The Data Quick numbers that come out monthly can be confusing as well. We continue to see unit sales down yet the median prices are holding fairly even. This is due to the fact that a few high priced properties are skewing the numbers. With fewer total sales each month it doesn't take many high end deals to skew the median upward. Now more than ever. We are dealing with micro markets and the picture can change dramatically from town to town. Here in Southern Alameda County the picture is equally mixed…..Fremont has 4.2 homes available for every 1 home in escrow (1 to 4.2), Pleasanton has a ratio of 1 to 3.5, San Ramon is 1 to 5.3, Livermore is 1 to 9 and Dublin is 1 to 4.6.
A continually increasing buzz of activity is being reported from most areas, and house hunters are becoming more motivated to make informed buying decisions now while interest rates remain low and inventory levels create bargains. Our Reality Check initiative continues to have a positive educational influence and consumer impact, and also reaffirms Coldwell Banker Residential Brokerage's reputation for being the leading residential real estate firm in Northern California.
More than 540 homes were held open last week and attendance was reportedly busy in most areas. Sellers should continue to take note that the well-priced homes in good showing condition draw the greatest number of potential buyers and get offers. A well-priced Berkeley Street listing drew 58 visitors, and other listings in the area averaged around 20 visitors each. Burlingame notes agents writing offers in all price points. Half Moon Bay, Livermore, San Francisco and most of the Peninsula also report increased buyer activity.
Overall, listing and sales activity remains steady for most offices, but with a buzz of excitement and an increased sense of urgency. Sellers are beginning to think about the upcoming holiday season and many may be reconsidering their decision to sell. While the inventory remains on the market, there are bargains to be had.
10/22/07 Our company distributes an internal market summary each week. It's authored by Coldwell Banker's N. Ca. President and it often contains some surprising insights. I'll share it with you............
"Offices throughout the San Francisco Bay Area reported increased sales, increased activity and optimistic sales associates. Of our more than 560 homes held open, the majority of areas reported moderate to heavy attendance and many reported an influx of new buyers who aren't letting the barrage of mixed messages about the real estate market frighten them away from diving into the waters. We are also hearing of newly invigorated buyers who have finally realized that this really is the time to buy.
In remembering that real estate markets are local in nature, let's take a snapshot of some of the markets in the Bay Area this past week. From the North, reports indicate that new listings in Santa Rosa were seeing a good turnout of qualified buyers. Sales activity is increasing in Southern Marin and Greenbrae areas, and higher-end home sales continue to be strong. From the Peninsula, Burlingame reports that sales in upper-end communities continue to be very strong, and that many agents report meeting new savvy buyers at busy opens in a variety of price points. Menlo Park notes increased sales activity and very busy open homes. Palo Alto simply states, "Low, low inventory. High, high multiple offers." In the East, it is reported that the inventory of active listings in the Livermore/Tri-Valley area is declining. Homes under the $1 million price point in Lafayette and Orinda are selling with multiple offers. The hills of Oakland are swarming with buyers who are willing to go into multiple offer situations on the right properties. A home in Lafayette was listed for $910,000 last week and received 7 offers all over asking price. There is a decent market out there regardless of what the media is telling people.
We can't repeat the message often enough - now is the time to buy! Let's have a quick reality check: Inventory levels in most areas are starting to decline. The median price for homes in the San Francisco Bay Area rose almost 1% in September. Rents are soaring. There is still a wide, but declining, selection of homes for sale in many areas and there are bargains to be had. It's time to make that long term investment - now.
Understandably, there are still many buyers who are milling around trying to figure out who to trust!"
As a person who really loves to watch economic events, the stock market and real estate cycles I'll never understand why or how the major networks and cable channels focus on negative real estate news. As a real estate broker I find myself spending more and more time correcting the misinformation quoted on the news for my clients and would-be clients. I'll give you an example; who hasn't heard of the recent double digit decline in home sales from the same time last year. This should be of great concern to any home owner of buyer. However, when the pundit or newscaster fails to disclose that the drop was from an all time record high in sales, they are talking out of context and misinforming the public. The media's snapshots of market activity may grab the consumer's attention but they also distort the big picture. Currently we are knee deep in unsold inventory. Selection is like it hasn't been in years and interest rates are retuning to very attractive levels. Conforming interest rates are at their lowest levels since May. This is what we practitioners call A BUYING OPPORTUNITY. Instead of buying, many buyers who are in the market now will follow the media sound bites all the way to the next real estate market lift off before they get serious about buying. There won't be the selection, but there will be a return of irrational purchasing so why not beat the crowds, buy low, buy know and watch the real estate circus from the comfort of your front porch when it comes back to town. Larry
An Expert Opinion! 10/1/2007
Just heard a presentation by Gary Watts, Real Estate Economist....He's more optimistic than most! Finally. Gary is saying the media version of our current real estate downturn is overstated and out of context. Lot's of statistics were presented in contrast to the media prognostications. Here's an example. "Only 3.23% of all sub-prime loans have entered the foreclosure process while the experts forecasted 7+%." Does that mean our market is only half as bad as we thought? Maybe, maybe not but the big important trends that have fueled buyer demand through the first half of this decade appear to be still intact according to Gary. They include: Strong home buying by immigrants specifically Latinos and Asians, (the falling dollar doesn't hurt), A continued influx of baby boomers to our warmer climate, A continued expansion of our job market (buyers now sitting on the side lines continue to have their incomes grow) and a continuing supply/demand imbalance. He closed by saying while most our lamenting the ailing real estate market, the smart cookie is buying or getting ready to buy. Why? .....Because this downturn is a short detour in a market with continued strong economic underpinnings. Exploit the current situation. Buy and don't follow the crowd and wait for the market to advance. If you do you'll have less buying power, less selection and probably caught up in a multiple offer headache!!!! Larry 925 216-5869
Are We Seeing Any Light? - Livermore, Ca - 9/21/07
OK, foreclosures continue to rise, but the Fed's finally cut rates. Some jumbo lenders ($417,000 & above) have reentered the market this week but property sales are still relatively stagnant. Are we starting to see the light at the end of the tunnel? Or ..are we just being wiped side-ways in real estate market that continues to writhe in pain? The truth is we just don't know, but let me give you some perspective.
This slow down was inevitable with or without the Sub-Prime mess. The sub prime implosion accelerated the market drop and victimized those who could least afford it. Although the percentage of non-traditional loans in California is relatively small compared to total outstanding loans, they did comprise over 60% of the new mortgage loans in 2005/06. This is a first and one might say (follow me on this) that this is a non-traditional strain on the market and once it's over the market may surface as relatively healthy. It's true the market was getting to frothy and buyers were starting to through up their hands in disgust but there were plenty of buyers out there and most of those buyers are still out there waiting for a better time to buy. Yes, I know you can't time the market but when you stand little to loose in waiting, buyers will at the very least, search at a more leisurely pace. That's where we are at. Now, most adjustable rate resets like those in the sub prime loans will take place by late April 08 and that could be the beginning of the end to the negative media bias towards the real estate market. This would be a big event because the most negative part of the current market is market psychology. Unlike past downturns, the underpinnings of our local economy are strong and buyers sitting on the side lines biding there time. Keep in mind there still exists a huge shortfall between the amount of new housing being built and the formation of new households in California. Like the South, this market will rise again. For now though, don't miss this buying opportunity if you are a buyer. The market bottom is perceptible only after the fact and buy then you could be playing the multiple offer game. We've been there, and like all market activity….It's A Cycle! Larry Waelde, Assocaiter Broker 925 216-5869
A Market in Retreat! OK, the Real Estate market presently stinks if you're a seller! So why has the San FranciscoBay Area median sales price edged up to a new peak of $660,000 recently according to DataQuick Information Systems. Therein lies the problem with a "median price" focus. It's just not an accurate measurement of short term price movement in housing. The median price is easily skewed up or down when a disproportionate volume of high end or low end homes sell in a given month. Currently, most local submarkets are not selling well, in part because banks are tightening qualifying standards due to the sub-prime meltdown. No, the average home is not appreciating, contrary to the median price advance. Bay area homes are selling at their slowest pace in 12 years and sales are down by about 21% from this time last year. However, not all sub-markets are behaving the same. In Pleasanton the ratio of available listings to pending sales is 8.4 to 1. Here in Livermore the ratio is 10.6 to 1. San Ramon ratio is 5.4 to 1. Dublin ratio is 5.8 to 1 and in Fremont the ratio of listings to pendings is 4.97 to 1. "The current rout for California homes sales is worse than the downturn in the first half of the 1990s and recovery could take as long as 18 months" according to Robert Kleinhenz, an economist with the California Association of Realtors. Many buyers are waiting for the market to worsen before they strike. If you are a buyer you should be actively looking, defining your neighborhood of choice and picking a qualified buyer's agent. You'll only see the market bottom in your rear view mirror...don't miss this buying opportunity!
I continue to be impressed (and relieved) to see how consistent many real estate investors deal with the changing real estate landscape. Even though it is fairly obvious that we are in the "bumpy bottom" in the Bay Area market,, the "old timers" continue to prudently acquire real estate and invest in real estate funds. Yes the current short term market is a bit nerve racking. HOWEVER, it is my continued belief that Bay Area real estate is a very solid long term bet. I've been in real estate my entire working like starting as an appraiser in the 70s and my only regret is that I hesitated to buy in uncertain markets. Please don't hesitate to call anytime you have questions on the market, your property's value or where's the best place to invest. Larry 925 216-5869
While general real conditions in the East Bay range from a relative sellers market to a clear buyers market, don't loose site of the big picture.... the Bay Area market is and will continue to be a solid investment! For over 20 years I have been impressed by the resilience of Bay Area Real Estate. I have watched and weathered two major real estate storms in my tenure as a real estate professional. Media gloom and doom came with both, and we are currently in the "third occurrence". It's a Cycle
I want to share with you a couple of thoughts and perspectives that continue to be on my investment horizon. First of all, you must already know that the Bay Area is unique in its character and its desirability. It continues to maintain social and employment diversity, with recreation environment unparalleled in the World. We offer access to glorious beaches, mountains, forests and majestic national parks, all within a few hours of our homes…. And often in our own back yards. Secondly, when Real Estate dynamics change and most areas of the country respond with years of downturn, our investors and opportunistic first time home buyers jump in to take up the slack. Why…? Because it's absolutely the best place in the World to live and work….That's why!
Where else is the weather nice all year and where else can an entire industry collapse like the Dot-Com Bomb and workers still find employment in surrounding fortune 500 Industry? NO Where!
I remember when it first hit for me - in 1980. The prime rate hit 21.5% (currently at 8.25%) and the country was experiencing double digit inflation. Mortgages got as high as 17.5%. As you all know, Bay Area Real Estate bounced back with a vengeance. It happened again in 1989, and guess what - same outcome. Why .. Because it's absolutely the best place in the World to live and work…..That's Why!
So where are we today? Well, it's not over…. And I am still watching and waiting for final outcome, but if history serves us…. And the current data stream continues , we are in it every day, all day and we track sales in the Bay Area like there's no tomorrow. Here's a great turn of events that made my day this month. In the past 4 months, 8.3% of Bay Area cities being monitored by us had positive price increases. However .. 60.4% of the Cities had price increases in April!
That's right….almost 2/3rds of monitored Bay Area Cities are increasing in value!
Thinking about buying? Do it now. Ok Ok, it may not be the perfect bottom….but all indicators that we see are showing that we are there. Yes, there are still problem areas like Stockton but I can happily say if the trend continues, that we do believe that worst is behind us!! Larry
ZIP Codes: 94566, 94588 Approximate Location Boundaries: Pleasanton
About Kathleen and Larry Waelde:
Kathleen and Larry have been helping families on the move for over 20 years. Kathleen has specialized with relocating families, optimizing on her experience as a relocation consultant with a major relocation company in the early 1980's. Larry was first licensed in 1975 and has worked in real estate his entire career. As a team their goal is to give the highest level of service in the industry! And with a personal touch!
These reports reflect the views and opinions of their authors and are not necessarily the views and opinions of Realty Times.
