My buyers are still experiencing multiple offer situations with all of the available listings here on the San Francisco peninsula, especially with homes that are priced under $500,000. They are getting frustrated and some have stopped searching all together. All I can say is to hang in there and something will come your way. This is still the best time to buy something while interest rates and home prices are still low. Multiple offers will continue if the inventory continues to be scarce. There might be some relief soon as banks start to release their huge shadow inventory. It is estimated that there is more then a million homes that are being held. Will this HELP? I hope so.
Home sales have declined in some areas and its due to high demand, low interest rates and a shortage of homes to buy. This creates a change in the market place. Not good for buyers but good for sellers.
Buyers around the bay area are going to be happy to see more homes on the market. Currently homes that are under $400,000 are experiencing a seller’s market. Most sellers are receiving multiple offers for their home. Every home that I have made offers for my clients have had more then 1 offer. One house in Hayward had 18 to 20 offers. Another house in San Bruno had 6 offers. My listing in So. San Francisco received 2 offers above the asking price, right after my open house, and 1 was all cash. My other listing in Pacifica received 8 offers, all over the asking price. It’s like that all over the Bay Area. It’s pretty discouraging for buyers today.
Maybe there is some relief coming soon. There is a shadow inventory due to be release around summer. I hope this will help the buyers that are trying to get into their home.
It seems like the market is improving. Sales have been increasing and here are 8 areas that are showing signs of a recovery.
I have been experiencing a market that resembles the last seller’s market not a buyer’s market. There is not a lot of inventory available for all of the buyers here in the Bay Area. I have a property for sale in Pacifica, Ca, listed at $338k and received 6 offers and all above the list price. I have been also representing buyers and making offers to purchase, but have been in bidding wars. In San Mateo county, it would take approx. 4.1 months to sell all of the homes that are on the market compared to 4.5 months same time last year. Where are all of the bank owned properties?
Bank owned inventory nationally grew to a record high of 2.2 million in March and foreclosures starts increased by 33% month over month. This may sound bad but foreclosure sales have increased and delinquencies are down by 11% which is the lowest since 2008.
Pending sales have increased which is a good sign that the demand is strong and the inventory will decrease hopefully faster then any increase. The U.S. is expected to add at least 750,000 new households in 2011 which is a healthy demand. A lot of these new homeowners are a result of lower home prices that are cheaper to buy then to rent, low interest rates, and more confidence in the recovery of the economy.
“The good news is that recent home buyers are staying well within budget, leading to exceptionally low loan default rates among home buyers over the past two years,” Yun added.
If you plan to purchase a home in the near future, you might want to speed up the process in order to have 3.5% of your closing cost paid by Fannie Mae. That’s right, Fannie Mae is trying to decrease their inventory of REOs. If you close on a HomePath property by June 30, 2011, you’ll be able to save 3.5% of the purchase price in closing cost. So act now!!!!
There are about 78,000 homes that are either vacant and for sale, or under construction. This is an improvement and with a normal level of buying, the homes would sell in 2 1/2 months. The study shows that there is a housing shortage brewing. If this happens, then it would change the market to a seller’s market and buyers will have a hard time purchasing again. The market today is still considered a buyer’s market and there are more bargain hunters out looking for deals. More investors are also very active making all cash purchases. There are 6 cities that are considered to be cheaper then renting the same house. All this may be history if unemployment rises, which it is decreasing today, interest rates continue to rise and become non deductible.
For the third month in a row, mortgage lates, 90 days or more, have declined. This could be another sign of recovery. With fewer defaults, the inventory level of REOs and short sales should go down as well. Could this be the bottom or is it a double dip situation. Only time will provide us with an answer. Either way, now is still a good time to purchase real estate.
In the coming months San Francisco will experience an increase in closed sales because the number of pending sales has increased by 8.9% which represents 2.6 months of the current supply of homes. If supplies continue to decrease and demand stays strong, maybe a seller’s market might be on the horizon.
The market will change if employment increases and interest rates stays affordable. However, if more distressed homes come on the market, we may not see a market shift for a long time or we may see a double dip in prices.
In January, pending home sales declined however, the data is based on contracts signed in January not closings. According to Lawrence Yun, NAR Chief Economist, “The housing market is healing with sales fluctuating at times, depending on the flow of distressed properties coming on the market,” he said. He expects the recovery will be a straight upward path because there is still an elevated level of shadow inventory of distressed homes and interest rates are still historically low.
According to the Wall Street Journal, there are plenty of signs that the housing market finally bottoming out. If investors and buyers continue to take advantage of the most affordable housing in decades, prices will probably bottom out in 2011.
During the 4th quarter of 2010, over half of the metropolitan areas have experienced price gains from a year ago, but the rest of the areas did not. NAR chief economist Lawrence Yun is encouraged by the trend and says the sales in the last quarter of 2010 has absorbed much of the inventory including distress properties. This could be a good sign that we may be recovering. With the continued improvement of the market and more jobs become available, the market will be back to normal.
Interest rates have been a big factor in sustaining the sales of homes. Last year we have seen interest rates at its all time low, but the rates have been inching up. This is a reaction to the housing recovery that we might be experiencing. We may never see rates lower then 5% in the future. In my 30 years of working in this industry, I thought I would never see interest rates lower than 6%, but it did happen. If you’re planning to finance a purchase or refinancing an existing property, you may want to do it now before the rates go sky high.
