San Francisco Real Estate - Residential

San Francisco Real Estate Market Update for the week ending May 17, 2009

NAR Announces Housing Affordability Highest in 18 Years – And Many Offices Report Increased Activity in High End Sales

For months I’ve been sharing that this is one of the best times to purchase a home in decades. This week the National Association of Realtors underscored that fact –stating that nationwide housing affordability jumped 10 percentage points during the first quarter of 2009 to its highest level since the series began 18 years ago, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI). The HOI showed that 72.5% of all new and existing US homes sold in the first quarter of 2009 were affordable to families earning the national median income of $64,000, up from 62.4% during the previous quarter and up from 53.8% during the first quarter of 2008.

Locally, the story is much more dramatic. In the San Francisco-Peninsula area, 32% of all new and existing homes sold in the first quarter of 2009 were considered affordable to families earning the area’s median income of $96,800. That’s up 60% from the previous quarter and up an incredible 146% from a year ago, when the index was a paltry 13%, one of the lowest affordability ratios in the United States.

Follow the link below to get the historical charts and details on North Bay, East Bay, Silicon Valley, and Santa Cruz, as well as many other Metros in the US.

http://www.nahb.org/page.aspx/category/sectionID=135

Below you’ll find a few more news stories of interest from the week:

• http://rismedia.com/2009-05-20/buyer-interest-in-foreclosures-spikes-says-survey/
• http://www.nytimes.com/aponline/2009/05/19/us/politics/AP-US-Economy.html?_r=2&scp=17&sq=housing&st=nyt
• http://rismedia.com/2009-05-18/distressed-properties-and-first-time-home-buyers-the-recipe-for-real-estate-recovery/

Many of you have asked me questions about the potential changes in the $8,000 first time buyer tax credit (http://www.realtor.org/RMODaily.nsf/pages/News2009051202?OpenDocument). Essentially the U.S. Department of Housing and Urban development announced on May 12th that the Federal Housing Administration would permit its lenders to allow home buyers to use the $8,000 first-time homebuyer tax credit as a down payment. FHA’s approved lenders would be permitted to “monetize” the tax credit through short-term bridge loans. This would allow eligible buyers to access the funds immediately at the closing table. Here is a CNN Money article which explains some of the details:

http://money.cnn.com/2009/05/18/real_estate/tax_credit_as_downpayment/index.htm?postversion=2009051912

I must caution that the execution of this is quite complicated and it may take some time before it becomes a reality. By late this week, there were already comments coming out of Washington that this may have been released a bit prematurely, and there is no guarantee that it will be successfully implemented. HUD would need to authorize lenders, non-profits and certain agencies to provide a bridge loan which would then be reimbursed at the time of tax refund. These players are not yet identified. Again, an encouraging and useful tool, but the execution and timing of it have yet to be fully outlined. Watch for more to come.

Read the rest of the article here.

posted by SFResidence.com @ 6:26 PM