San Francisco Real Estate Market Update for the week ending July 19, 2009
YOU’VE GOT TO GO THROUGH “LESS BAD” TO GET TO GOOD
It seemed everywhere you looked this week, the media was reporting on some sort of positive indicator relating to the real estate market. For starters, Good Morning America ran a story on Tuesday about the state of the housing market. You can see the interview here:
http://abcnews.go.com/video/playerIndex?id=8190034 Liz Ann Sanders, the Chief Investment Strategist for Charles Schwab, and Mike Santoli, Assoc Editor of Barron’s were interviewed. Essentially they both indicated there are enough cumulative signs from indicators to say that things are not only “less bad”, but we are starting to see some pockets of improvement in the housing market. Among the vital signs they said to watch for in calling a recovery are; Index of Leading Economic Indicators, currently up three months in a row; drop in new unemployment claims (the four week average is down 93,000 from the peak, and never before has there been this large of a drop while still being in a recession); and the spread between short term (set by Fed) and long term (driven by the market) interest rates, which is widening. Additionally an opinion was shared that if the Dow stays above 8,000 – this would be a good indicator that we’re on the road to recovery. This week we danced over the 9,000 mark, closing today at 9,171; making it the best July for the Dow in over 20 years.
Our industry was the first to be hit by the economic downturn and if all continues on this path, we will be the first out. We probably won’t see housing numbers start to appreciate across the board anytime soon. What we are seeing right now are signs we typically see at the bottoming-out of a down market. Speculators and investors are competing with first time home buyers. Those individuals are going to continue to gobble up the inventory—both REOs and non-bank sellers at the entry price level. In many metros across the country, there are very low levels of inventory at the low end. I was on the phone this afternoon with the Coldwell Banker president for Arizona. They were hit hard, and early, with foreclosures. He told me that today the Phoenix Metro area has under 2 months supply at their entry level, <$250k – yet a 7 years supply of inventory at their estate home level of $2M+.
Also this week the Standard & Poor’s/Case-Schiller 20-city index was released and in it, home prices in May posted their first monthly increase since the summer of 2006. Prices rose from April in 13 of the metro areas tracked, notably Cleveland, Dallas, Boston and the Bay Area. The news followed reports showing sales of newly built and existing homes rising in June for the third consecutive month. New home construction, though still weak, is the best it’s been since the fall.
Read the entire article
here.
Fast Facts from CAR and Freddie Mac – June 2009
New statistics for California real estate activity for May are now online at our website. Read the report here.
- Janis StoneDRE 00517072
TRI Coldwell Banker San Francisco real estate statistics – last week in review
Our office is kicking butt and taking names. During the summer we are normally on a slow down in sales, but this last week was phenomenal. SFResidence alone closed 4 deals this month and put a couple more into escrow. Things seem to be picking up for the San Francisco market as buyers see opportunity and sellers are becoming more realistic!
See the report on our
website.
- Janis Stone DRE 00517072
Mortgage Weekly Update – Last Week in Review
Foster Weeks publishes a
weekly mortgage report which is updated every Monday morning. How is this affecting the
San Francisco real estate market? Read our
weekly and
monthly market reports. Here’s what Mr. Weeks says about last week’s activity:
IT’S THE THOUGHT THAT COUNTS…OR IS IT? As we look back at last week, think about this for starters – the housing industry received some welcome good news, as Existing Home Sales came in better than anticipated, and marking the third straight month that Existing Home Sales have increased. And perhaps even better, the supply of unsold homes on the market dropped from the prior reading of 9.8 months down to 9.4 months – which is the best level seen in over a year. With home loan rates still at low levels and homes priced to sell – this is a great time for potential homebuyers to stop thinking, and go ahead and take some action.
Despite that bright spot of news, last week’s Consumer Sentiment report – which measures consumers’ attitudes and expectations concerning both present and future economic conditions – showed that consumers still think the economy has a ways to go, as the report did come in a bit weaker than anticipated. According to the report last week, Consumer Sentiment came in at 66 for the month of July, down from June’s reading of 70.8. Take a look at the chart below for an interesting historical perspective on this report.
And one of the major reasons for the decline in Consumer Sentiment was ongoing concern over unemployment – and last week, Initial Jobless Claims reportedly rose by 554,000. While this number was high, it was essentially in-line with expectations of 557,000.
The big news that many headlines featured was the number of Continuing Claims, which fell from 6.31 million the prior week to 6.22 million. And although this drop was reported as positive news, we need to remember that a large number of people are still unable to find jobs, but are no longer being counted in Continuing Claims because their unemployment benefits have expired. The bottom line is that it will be hard for the economy to really turn higher with momentum until the labor market starts to turn around.
Stocks had a good week, with the Dow closing above 9,000 on Thursday for the first time since January 6th, as well as finishing the week with its strongest two-week span for blue chips since 2000. Since Stocks moving higher can drain money away from Bonds, the rally in Stocks – combined with the announcement of next week’s Treasury’s auction of $115 Billion in Notes – put selling pressure on Bonds toward the end of the week. Despite some volatile mid-week action, home loan rates closed out the week near the level where they had begun the week.
Read the entire article
here.
TRI Coldwell Banker San Francisco real estate statistics – last week in review
As summer chugs along, so does the market. We are seeing a lot of steady activity which is a pretty good sign, though prices are not at the level they were several years ago.
See the report on our
website.
- Janis Stone DRE 00517072
San Francisco Real Estate Market Update for the week ending July 12, 2009
Data Quick Releases Its June Figures With Promising ResultsDataQuick Information Systems released its June monthly report on the Bay Area Thursday (
http://www.dqnews.com/Articles/2009/News/California/Bay-Area/RRBay090716.aspx) to some interesting month-end figures, including increases in sales and median home prices. In fact, the company reported; “Home sales in the Bay Area jumped to their highest level in almost three years, the result of improved mortgage availability and a perception among potential buyers that prices have bottomed out. The median price paid for a home increased month-to-month for the third month in a row.”
Among the highlights of the story:
- A total of 8,644 new and resale houses and condos sold across the nine-county Bay Area in June.
- That was up 16.1 percent from 7,447 in May and up 20.4 percent from 7,178 in June 2008.
- Home sales have increased on a year-over-year basis the last ten months.
- The median price paid for all new and resale houses and condos sold in the nine-county Bay Area was up 3.1 percent from May, although down 27.4 percent from June 2008. It was the highest since last October.
- The current median is 47.1 percent below the $665,000 peak reached in June 2007. It hit a low of $290,000 in March this year. About half the downturn appears to be price declines, the other half is the absence of high-end home sales in the statistics, which pulls the median down.
Read the rest of the report here.
Mortgage Weekly Update - Last Week in Review
Foster Weeks publishes a
weekly mortgage report which is updated every Monday morning. How is this affecting the
San Francisco real estate market? Read our
weekly and
monthly market reports. Here’s what Mr. Weeks says about last week’s activity:
INFLATION, ALL WE NEVER WANTED…! Or so the Go-Go’s song “Vacation – All I Ever Wanted” could have been re-written this week, as whispers and glimmers of future inflation as well as some positive economic news roiled the Bond market. Overall, home loan rates worsened by about .25% across the board.
Inflation at both the wholesale and consumer level came in hotter than expected via the Producer Price Index (PPI) and Consumer Price Index (CPI) reports, the latter shown in the chart below. The Consumer Price Index (CPI) rose by more than expected, and was the biggest increase in a year, mostly due to higher gasoline prices.
However, a look back over the past year shows a drop in overall CPI of 1.4%…why is this? It was a year ago that a barrel of oil was $147, and today that barrel stands at $60, up from the $30 range seen earlier this year. But even when stripping out food and energy, the most recent Core CPI rose 0.2%, higher than the 0.1% anticipated – and year-over-year, Core CPI prices were up 1.7% after rising 1.8% in the 12 months ended in May. On the wholesale side, even excluding volatile food and fuel prices, Core PPI rose quite a bit more than anticipated as well. And remember, inflation is bad for Bonds and home loan rates. If this trend continues, it could have a big impact on rates later this year.
Read the entire article here.
TRI Coldwell Banker San Francisco real estate statistics - last week in review
It gets old repeating the same thing over and over every week. The good news is, the news is good! We all know the real estate market is having its challenges and San Francisco is no different. Unlike the market several years ago where multiple offers meant over asking price sales, now they mean just the opposite. Most often multiple offers are close to each other and almost always under the listing price. The challenge is for the listing agent to get the best price he or she can for their client. That's the importance of having a successful agent with experience. See the report on our
website.
- Janis Stone DRE 00517072
San Francisco Real Estate Market Update for the week ending July 5, 2009
Realtor.com Survey Tells A Lot About Today’s Housing MarketEarlier this week Realtor.com released a survey discussing some of the key factors which are motivating buyers in today’s market. It was an interesting read and I thought I’d share the highlights:
- “Price declines and low interest rates are motivating millions of home buyers to shop for bargains in the most affordable housing market in 28 years, yet at the same time only one in ten of today’s home owners say they have delayed selling their home due to those same market conditions.”
- “Affordability is clearly driving more than two thirds (65.2%) of potential buyers back into today’s housing market. Nearly one of five prospective buyers (19.6%) say foreclosure bargains in their communities would motivate them to purchase a home, the most important reason they’re interested in buying in the near future.”
- “An additional 15.5 percent said they’re motivated to buy soon because they think prices are as low as they will go and another 15.5 percent said they were motivated to buy before interest rates rise. For 14.6 percent of first time home buyers, the Federal $8,000 tax credit is the impetus to purchase a new home in the future.”
- “In the past year, the Housing Affordability Index maintained by the National Association of Realtors has increased 29 percent overall and 19 percent for first-time homebuyers, and is higher now than at any time in the 28 year history of the index.”
- “Value is clearly motivating potential home buyers, and today’s new level of affordability is still an under-appreciated reality that needs to be explored,” said REALTOR.com President, Errol Samuelson. “The variety and quality of homes currently within reach of the average American family is much greater than most people realize. Making credit available to responsible borrowers and building consumer confidence in the economy are now key factors in restoring vitality to the nation’s housing market.”
Now, let’s take a look at this week in real estate: The key takeaways—inventory is low with multiple offers in the lower price ranges, and improved activity in the higher priced markets.
Read the rest of the report here.
Mortgage Weekly Update - Last Week in Review
Foster Weeks publishes a
weekly mortgage report which is updated every Monday morning. How is this affecting the
San Francisco real estate market? Read our
weekly and
monthly market reports. Here’s what Mr. Weeks says about last week’s activity:
"EVERY DARK CLOUD HAS A SILVER LINING...BUT LIGHTNING KILLS HUNDREDS OF PEOPLE EACH YEAR WHO ARE TRYING TO FIND IT." Larry Kersten. Now that's pessimism! Interestingly enough, in recent weeks - Traders have been searching to find a silver lining or at least a glimmer of light in the dark economic reports - trying to find something to be optimistic about. Last week - the economic report calendar was lean but volatile, as Traders sought for morsels of good news amidst the gloom. All in all - home loan rates improved slightly in the early part of the week, but then worsened towards the end of the week.
Remember first that when Stocks move lower, some of that money can move over into the Bond market, helping Bond prices move higher and home loan rates move lower. Last week, Bonds benefitted early on from Stocks trading sluggishly, partially due to other world equity markets being pressured lower under concerns for the overall global economic recovery - but the economic news calendar was thin. However, things really heated up mid-week, as earnings season kicked into gear, big Treasury auctions hit the stage, and an interesting look at the job market arrived via the Initial Jobless Claims numbers.
According to that report, the number of initial unemployment claims last week dropped off by 52,000 to come in at 565,000 new claims, better than expected and the lowest level since January. Initially, Stocks reacted with some euphoria - but then reversed lower. Why? Think about it for a minute. Is the fact that 565,000 people applying for unemployment benefits for the first time, over the course of a holiday shortened week, really such terrific news? It's like when someone is starving, and manages to find a crust of bread in the trashcan it seems great at first, until the overall reality sets back in. And so seems to go the Trader mindset lately. Starving for any morsel of good news and looking hard for a silver lining amongst the clouds, sometimes news that is really pretty bad - like 565,000 people applying for first time unemployment benefits - is initially overblown with euphoria...that then quickly wears off.
The real story is that continuing unemployment claims - which measures the number of people who still receive jobless aid after their initial week - rose by 12,000. When you add it all up, the number of Americans receiving unemployment benefits total 6.88 million, which is a new record high and more than double what it was this same time last year. The underlying problem is that companies still aren't hiring, which means the jobless rate will continue to rise. In turn, unemployment will continue to curb consumer spending and, in the big picture, will slow economic recovery.
Read the entire article on our
blog.
HOA President is Paid Manager
From time to time we post educational information regarding HOA rules and regulations. This is because we represent a lot of condo buyers and sellers and want them to be informed. Read the most recent post on our
website.
- Janis Stone
DRE 00517072
Reality Check – From Rick Turley
Presented by Janis Stone and
SFResidence - San Francisco Real Estate:
This is a new column we will be featuring every week in a message from our President of Coldwell Banker, San Francisco Bay Area, Rick Turley.
The Rise and Fall of Interest Rates
As I’ve been in the offices over the past few weeks, I have received many positive comments on Reality Check and how impactful it has been with your clients. It is my goal to provide you with timely and pertinent information on key factors which affect our local real estate market. Hopefully these topics bring some clarity to Buyers and Sellers, especially when today’s consumers need it most.
One of the key elements that makes buying in today’s market so attractive is the relatively low interest rates available in our marketplace. But recently, as you know, interest rates have begun to fluctuate leaving many would-be buyers confused and wondering if they should wait.
That leads me to this month’s topic—interest rates. We met with Princeton Capital to get their view on the changing financial market. In collaboration with Brendon Riordan of Princeton Capital, we have created a Mortgage Q & A to share with your clients. This FAQ addresses today’s attractive interest rates and what the recent fluctuations may mean for a buyer...
Read the entire column
here.
Fast Facts from CAR and Freddie Mac - May 2009
New statistics for California real estate activity for May are now online at our website. Read the report
here.
- Janis Stone
DRE 00517072
TRI Coldwell Banker San Francisco real estate statistics - last week in review
This week showed continued improvement in the housing market for San Francisco. Surprisingly even though listings were down, our office ratified 16 deals meaning if we weren’t selling it, then we were representing the buyers. That’s good news since this is officially a buyers’ market and deals can be made.See the report on our
website.
- Janis Stone
DRE 00517072
The Goldman Report for July 7, 2009
He's back! After a long absence, Avram Goldman is back online with a new blog! While Avram Goldman is no longer with Coldwell Banker, he is a friend and associate at Pacific Union with an excellent handle on San Francisco Real Estate:
Can You See the Bottom Yet?I am consistently being asked, “
have we reached bottom yet?” Whether it is buyers, sellers, the press or agents, everyone wants to know is the worst behind us.
The current Bay Area data reflects that the watermark in the under $500K market has been set. Median price has either been flat or rising in all counties in that price range over the last 90 days and depending on the county, we are beginning to see price stabilization in properties up to $700K. Last week you might have thought is was 2005, our SF Sunset 2 bedr. 1ba. listings priced at $545K received 53 offers. A new record for this market. Now some may say the property was a bit under priced, maybe, however it went well above the asking price. This listing demonstrates that there is certainly strong demand for that neighborhood and that buyer’s confidence is rising.
These price ranges are steadying because of diminishing inventories and sellers, which includes both banks and individuals, now coming to a more realistic view of pricing. Buyers have done their homework and know values. There is no “greater fool theory” operating. More and more buyers are evaluating based on dollar per sq. foot...
Read the entire article on our
blog.
- Janis Stone - DRE 00517072
San Francisco Real Estate Market Update for the week ending June 28, 2009
There is no market report for this week because of the Fourth of July weekend. Rick will be back next week. Read our other market reports on the SFResidence.com
website.
- Janis Stone
Mortgage Weekly Update - Last Week in Review
Foster Weeks publishes a
weekly mortgage report which is updated every Monday morning. How is this affecting the
San Francisco real estate market? Read our
weekly and
monthly market reports. Here’s what Mr. Weeks says about last week’s activity:
I hope you and your family enjoyed the Independence Day holiday weekend. And, I sincerely hope you have been enjoying your complimentary subscription to the MORTGAGE MARKET GUIDE WEEKLY.
Due to the July 4th holiday, the next full issue will arrive on Monday, July 13. In the meantime, check out the article below on one of our nation’s most powerful symbols this time of year: the Stars and Stripes.
The MORTGAGE MARKET GUIDE WEEKLY is the industry’s leading publication of this type, and I am pleased to provide this valuable resource to you. If you feel any of your clients, friends, family members, or associates would benefit from keeping up-to-date on market and economic trends in this easy-to-read format, please let me know and I will be more than happy to add them free of charge.
Best wishes to you, and please do not hesitate to contact me if you need assistance at this time!
- Foster Weeks
July Newsletter Now Online!
Our
July newsletter is now online. If you would like to subscribe to the e-mail newsletter go
here.
- Janis Stone
San Francisco Real Estate Market Update for the week ending June 21, 2009
Existing Home Sales Rise For Second Straight Month
The National Association of Realtors released its existing home sales report which noted that existing home sales rose for the second straight month in May, signaling low prices and incentives are attracting buyers.
NAR says existing home sales, including single family homes, condos and coops rose 2.4 percent in May. It was the first back-to-back monthly gain in existing home sales since September 2005.
NAR chief economist Lawrence Yun had this to say, “Historically low mortgage rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates. First time buyers are also being drawn off the sidelines by the $8,000 tax credit which is helping to absorb inventory.” The numbers could be even better if it weren’t for appraisal issues. While pending sales of existing homes—those with signed contracts but not yet closed—indicate stronger activity, some contracts are falling through from faulty valuations that keep buyers from getting a loan, said Yun.
We’re starting to experience more challenges with low appraisals here in the Bay Area, most often from out-of-area appraisers who have no experience and limited knowledge of local markets. The pendulum could be swinging a little too aggressively in some cases as regulatory controls meet market demand. You’ll find quite a few references to appraisal issues as you look through our activity for the last two weeks from our branches:
Read the rest of the report
here.
TRI Coldwell Banker San Francisco real estate statistics - last week in review
This week showed continued improvement in the housing market for San Francisco. Surprisingly even though listings were down, our office ratified 16 deals meaning if we weren’t selling it, then we were representing the buyers. That’s good news since this is officially a buyers’ market and deals can be made.
See the report on our
website.
- Janis StoneDRE 00517072
