patrick.net

read and comment

the following is from a realtor

==========

It has been very interesting since the start of the year only (end of last year was very slow) . Markets in the northwest area (starting from 94087 Sunnyvale to Menlo Park) are on fire, and the rest is also much stronger than last year.

I have noticed a 5-10% price jump in Cupertino, west SJ, and Saratoga and some 1-5% in Milpitas, Fremont, and San Jose. Menlo Park is quite unique area with increases as much as 50% , due to the upcoming Facebook IPO.

I have made many offers in Jan-Feb (in the following cities: Saratoga, Cupertino, Fremont, Milpitas, San Jose, Santa Clara, Sunnyvale) and ended up losing most of them to multiple offers that far exceeded most recent comps. The number of offers ranges from 5 (even in Milpitas, San Jose where there are still many distressed properties) to 21 and (just today) 30 in Cupertino.

Contact me if you need data (number of offers, contract price vs past comps) specific to your target area of interest

The bottom line is the trend is clearly UP., likely due to:
1.Robust tech hiring with significant pay increases.
2.Record low interest rates making homes more affordable.
3.Pent up demand held back during last few years
4.Strong stock performance of local tech companies

The media usually lags behind by a couple of months .By the time they report , it is usually too late, as usual. SJ Mercury News today has ”prices in Bay Area fall” as headline !!! Most sales in JAN/FEB have not closed. Besides, more sales at the lower end drag median number down and vice versa. Real estate markets are also unique and localized to each zip code and areas within one zip code.

That is why I have stopped reporting general median prices in my reports , starting JAN 2012.

We will have problems with appraisals in this uptrend as appraisers only look at past comps and are not out there bidding to understand market prices and neighborhoods very well.

Useful Info (from CA realtor organization)
Mortgage
I've heard people say they didn't want to buy a home because they were depressed by the thought of a debt that would last 30 years. I've heard others regret that they couldn't afford the payment on a 15-year mortgage and instead were stuck with a 30-year loan.

The fact is, you control when you pay your mortgage off, and it doesn't take a lottery or inheritance windfall to pay yours off sooner than later.

Some people pay half their mortgage payment every two weeks, which results in a full extra payment every year and can pay your mortgage off as much as five years early. Others just pay an extra $100 or so as often as they can, and ask their loan servicer to apply the overage to principal.

Some do much more, applying paycheck raises over the years or amounts they once paid to extinguish credit card debt toward their mortgage balances in an effort to pay them off early.

The theme is that, as a borrower, you may have much more power than you thought, from exploring little-known options for getting your upside-down mortgage's payment lowered to being aggressive about paying your home off sooner rather than later. So get clear on your personal goals for your mortgage, get educated about your options and get assertive about making them happen -- now..

Buyer:
.

From Dataquick:
The median's low point of the current real estate cycle was $290,000 in March 2009. The peak was $665,000 in June/July 2007. Around half of the median's peak-to-trough drop was the result of a decline in home values, while the other half reflected a shift in the sales mix.

“While it's clear prices have edged lower in some areas recently, last month's Bay Area median of just $326,000 is a reflection of how skewed the market has become toward distressed, lower-cost properties. The higher-end sales have slowed in recent months as many struggle to qualify for loans and others just sit tight. This is also the time of year that we caution people not to try to read too much into the statistics. The winter numbers are based on a smaller pool of buyers and they haven't proved very predictive,” said John Walsh, DataQuick president

Buyers who appear to have paid all cash – meaning no corresponding purchase loan was found in the public record – accounted for 30.0 percent of January sales, up from 27.2 percent in December, and up from 28.7 percent a year earlier

=================================================================

SJ Mercury News
This the headline from our local newspaper : Bay Area home sales mostly up, although prices fall
We have multiple offers on almost every sale in the lower part of the market," said Barbara Lymberis, president of the Santa Clara County Association of Realtors. "If people are thinking we haven't hit bottom, they're wrong."

#housing