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Category Archives: Market Information

Rents heading up. Affordability for home owner ship at 15 year best. Time to buy a home?

Written on December 6, 2011 by CJ Brasiel in Market Information

The Wall Street Journal reports stronger lure for prospective home buyers with the monthly cost of owning a home more affordable now than at any point in the past 15 years, homeownership is becoming less expensive than renting in a growing number of cities. The Wall Street Journal’s third-quarter survey of housing-market conditions in 28 of the nation’s largest metropolitan areas found that home values declined in all but five markets compared with the second quarter, according to data from Zillow Inc. Meanwhile, rent levels have risen briskly across the country and mortgage rates, hovering around 4 percent, are the lowest in six decades. As a result, monthly mortgage payments on the median priced home – including taxes and insurance – are lower than the average rent levels in 12 metro areas, according to data compiled by Marcus & Millichap. Homeownership also is looking more affordable because after several years of declines, apartment rents will rise approximately 4 percent this year, and rents are poised to pick up even more momentum across the country next year, according to Marcus & Millichap. Affordability could continue to improve as prices slide even lower in coming months. Price declines are likely because the share of “distressed” sales, including bank-owned foreclosures, tend to rise in the winter, when traditional sales activity cools. Tags: Market Information

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Housing Market in Review for San Jose

Written on November 21, 2011 by CJ Brasiel in Market Information

Good news! FHA loan limits have been extended at higher cost living area FHA loan amounts of $729,750 instead of $625,500! This will help FHA buyers opportunities to more homes in the Bay Area. HIGHLIGHTS: For the general housing market of Silicon Valley and Central Coast: The median price of existing single-family homes decreased to $510,000 down -1.0% vs Sep-11. Existing single-family home sales decreased -13.9% from Sep-11 for a Oct-11 total of 1,722 sold units. Condos decreased in price to $310,000 down -2.5% vs Sep-11. Existing condo sales decreased -8.6% in Oct-11 over Sep-11 for a total of 489 sold units. When you look at San Jose specifically: San Jose Median Price = $485,000 which is up 2% when comparing October ’11 to Sept ’11 but down 2% when you compare October 2011 to October 2010. Total volume of sales up 4% for October when compared to Oct 2010. But San Jose Neighborhoods are the real deal: Here is a pie graph showing neighborhoods by Sales Volume. Fairly proportion to neighborhood size except Willow Glen. Evergreen sales are up mainly due to Silver Creek average price. Total Dollar in Sales since July 2011: Another graph - More desired the neighborhood, the higher price and the lower the avg days on market (since July 2011): Guess where the deals might be? Finally- in preparation for holiday shopping – increasing inventory. But remember, this time 2008, we had nearly 4700 home for sale. (nearly 2x what we have now.) Amazing how consistent total closed sales run. I hope these numbers give…

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How will Shadow Inventory impact the San Jose housing market?

Written on November 17, 2011 by CJ Brasiel in Market Information

A potentially complicated, controversial topic amongst those following the housing market is how Shadow Inventory will impact the housing “recovery”. On the web you will find almost an equal amount of articles explaining why the shadow inventory will challenge the housing recovery until 2015. Look at another URL and you will find positive remarks on how the banks are releasing foreclosures now and how “robo signing” issues are resolving in the courts. First and foremost we must realize there is no typical free market economics in play here and no one knows the exact impact of to-date government intervention, state and federal fall out of massive files involved in the foreclosure process, the impact or non-impact of the “jobless recovery”, or how the EURO economic fallout will impact the real estate market for any foreseeable future. You have probably heard the saying, “all real estate is local”. Believe it or not, this is not simply a National Association of REALTOR® tag line. I know, you don’t believe me. But really, real estate is so very local you must understand the market neighborhood by neighborhood and more importantly, street by street. Neighborhood boundaries don’t exactly follow zip code lines. School boundaries do not follow neighborhood lines. All of those don’t follow generic San Jose reports. To understand current conditions and/or even attempt to predict where a particular group of housing prices will go in the future, is extremely hyper local and can not be wrapped up into averages. Speaking of averages, medians, and the like, the one statistical component that the real estate market predictions rarely include is standard deviation. In my very humble opinion, this is where the rubber hits the road in regards to how a true real estate professional can help buyers and sellers understand the local market. …

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San Jose Home Price Trends: Could 2012 be the beginning of a housing recovery?

Written on November 10, 2011 by CJ Brasiel in Market Information

What drives the real estate more than any other factor? Jobs. What drives buyers from renting to buying? Increase in rents to the point where home ownership is attractive. What drives buyers who plan to buy a home to buy now? Interest rates. So now, some data to back all these ideas up. From the LA Times report, “home prices are projected to turn around in 2012 — jumping 11.5% to $321,138 next year, then rising 10% more in 2013 to $353,411. The recovery is expected to run through 2017.” Here are graphs they showed on their post regarding California Home Price Recovery. From the California Association of Realtors Economist Leslie Appleton Young’s prediction for 2012, “The California median home price will increase 1.7 percent in 2012 to $296,000 in 2012, according to the forecast. Following a double-digit increase in the median price in 2010, the median home price will decrease a projected 4 percent in 2011 to $291,000.” According to The Economist Magazine’s writer Kari Smith, “My concern is over Owner’s Equivalent Rent. The data suggest to me that there is a shortage of housing in the United States. We should expect rents to begin rising in the near term. This will push up Owner’s Equivalent Rent which accounts for somewhere around 35% of core CPI.” Interest rates are expected to begin creeping up between 0-.25% per month in 2012 according to the the November 2011 Federal Reserve Update. If you have questions about a specific housing market around San Jose, contact me. If you have questions about real estate, ask me now via my online chat link to the right of this post. Tags: Market Information

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What are closing costs when buying a home?

Written on November 4, 2011 by CJ Brasiel in Buyers' Tips, Market Information, Sellers' Tips

Closing costs are any fees related to the purchase of a home that are outside the price of the home. Different states, counties, and cities calculate closing cost differently so it is best to speak with a real estate professional who is familiar with the area you intend to purchase your home. Closing cost are the combined fees charged by different entities to close the deal. Costs can include title fees, escrow fees, prorated fees such as taxes, insurance, and interest. Closing fees can also include the down payment, points on the loan, lender fees, and any inspections or repairs negotiated within the purchase offer. There is a ball park average for closing fees at about 1-2% of sales price. How much are Santa Clara County transfer fees? There are fees related to the transfer the property and in Santa Clara County these are paid by the seller. However San Jose, Mountain View, and Palo Alto also have a city transfer tax and this is typically split 50/50 by buyer and seller. Other counties such as Santa Cruz, Contra Costa and Napa do not have city transfer fees. Normally the transfer tax is calculated by multiplying the rate by sales price per $1000. An example of Transfer Tax: A home with a $500,000 sales price in San Jose would have the seller paying $1.10 per $1000 or $550 for the county transfer tax. The city transfer tax for this example would be split 50/50 by the buyer and seller and would be at a rate of $3.30 per $1,000 which would equal $825 each. There are also document recording fees, courier fees, electronic copy fees and miscellaneous fees such as notary and FedEx normally adding up to less than $500. Lender fees include the cost of completing the loan and…

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Do I qualify for the modified HARP program?

Written on October 26, 2011 by CJ Brasiel in Market Information, Sellers' Tips, Short Sale

On October 25th, President Obama visited Nevada, one of the hardest hit foreclosure areas in the United States, and announced changes in the HARP program to help more homeowners who are underwater on their mortgage. Based on calculations from The Federal Housing Finance Administration an “estimated an additional 1 million people would qualify. Moody’s Analytics say the figure could be as high as 1.6 million.” and potentially could help 1 in 5 Californians that are underwater on their mortgage. The HARP program has been around for awhile but one of the biggest limiting factors regarding its application is the loan to home value ratio could not be greater than 125%. In other words as long as your home only lost 25% of its value in the last 4 years you could qualify. Obviously, many home owners have lost more than 25% and some took out second mortgages that decreased their value up to 50%. With the revised guidelines, there is no loan-to-value ratio limit. To qualify for the program you must meet three basic requirements: You must be current on your mortgage and have not been over 30 days late in the last year. Your loan must have been initiated prior to May 31st, 2009 Your loan must be backed by Fannie Mae or Freddie Mac The biggest challenge to the program for Bay Area homeowners is few of the mortgages made prior to 2009 were backed by Fannie Mae and Freddie Mac. You can determine whether or not your loan(s) is owned by Fannie Mae or owned by Freddie Mac by entering your loan account number on these web sites. Also recognize this must be your primary residence and the program only replies to senior liens not home equity lines or second mortgages. Also, recently maximum loan limits for…

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Remodeled Home in Los Gatos For Sale!

Written on October 7, 2011 by CJ Brasiel in Market Information

Great Schools, Remodeled Homes, Large Lot! Overview Maps Photos Description Neighborhood Open House Market Stats IDX Search $948,000 Single Family Home Main Features 4 Bedrooms2 Bathrooms1 Partial BathroomInterior: 2193 sqftLot: 12,420 sqft Location 14540 Blossom Hill Rd.Los Gatos, CA 95032USA To get updates on open home dates and other property events, please click the “Like” button below: CJ Brasiel Broker Associate, SRES, GREEN Fireside Reatly(408) 406-6035CJ@CJBRealEstate.comhttp://www.CJBRealEstate.com Listed by: CJ Brasiel, Fireside Realty Our recent listings Great Schools, Remodeled Homes, Large Lot!Gourmet Kitchen Ready For You! Subscribe to our listing feed Nearby properties for sale Tags: Market Information

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Confused about the San Jose real estate market? I’m here to help!

Written on September 21, 2011 by CJ Brasiel in Buyers' Tips, Market Information, Sellers' Tips

No wonder the consumer is confused about where our real estate market is heading. One headline reads “More Foreclosure Activity”, another reads “Home sales up 19% year to year”, and don’t even bother listening to the news because everything is negative, negative, negative! That is why you need local market information! Thank goodness, you know me! So here is the local scoop. Out of 27 zip codes within San Jose: SIX had an increase in price per square foot in July and August over 2010. NINE had an increase in median sales price on average 15%! Highest increase by zip? 95112 – downtown with a nearly 23% increase over last year! (#2 Willow Glen, #3 Santa Teresa) ELEVEN had an increase in volume of sales with 95130 increasing nearly 50% over last year. Some of you have heard me say it but here it is again; Investors are buying homes. Willing to buy without leverage, all cash because they believe the potential upside is there. With nearly 30% of them paying all cash, it is hard to believe this is the whim of speculators. Consider the fact that your leveraged dollar is now at or below 4% because of interest rates, and that affordability is at a 30 year high for San Jose. There are opportunities for those who truly want a home. You will either be a home owner building equity or you are a renter building equity for these investors. “Last month absentee buyers – mostly investors – purchased 21.3 percent of all Bay Area homes sold, up from 20.5 percent in July and 17.8 percent a year ago. The peak was 23.4 percent in February this year, while the monthly average since 2000 is 13.8 percent. Absentee buyers paid a median $242,818 in August, up from…

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How will the new loan limit impact the housing market?

Written on September 7, 2011 by CJ Brasiel in Market Information

Only 4 years ago, the FHA loan was not available to potential home buyers in San Jose because the conforming loan limit was $417,000. This was one of the reasons that “exotic” loan products became available and fueled a market for negative amortization and interest only loans. When the housing crash occurred the government set out to help local housing markets by increasing the conforming/FHA loan limit for high cost areas to $729,750. The FHA loan provided many first time home buyers an opportunity to purchase a home with 3.5% down. This also allowed many of my clients to afford a home that they would not have been able to afford 4 short years ago. Historically, government backed loans like FHA have a significantly lower incidence of default due to the stricter lending guidelines required of the borrower. “More than 30,000 California families will face higher down payments, higher mortgage rates, and stricter loan qualification requirements if conforming loan limits on mortgages backed by the Federal Housing Administration (FHA), Fannie Mae, and Freddie Mac are reduced beginning October 1, 2011. Regionally, Marin County would be impacted the most, with more than 12 percent of home sales rendered ineligible under the lower GSE loan limit, followed by Contra Costa (11.5%), San Mateo (10.7%), San Francisco (9.9%), Monterey (8.8%), San Diego (8.2%), Sonoma (7.9%), and Santa Clara (7.8%) counties. Under the lower FHA loan limit, San Francisco County would be impacted the most, with more than 14 percent of home sales rendered ineligible, followed by Santa Cruz (13.9%), Orange County (13.3%), Marin (13.2%), San Mateo and Ventura (both at 12.7%), Santa Clara (12.2%), San Diego (11.9%), Alameda (11.8%), Riverside (11.5%), and Contra Costa (11%) counties. (According to analysis by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). )” If you agree that FHA loan…

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My Bank of America short sale offer was accepted. How long until the short sale is approved?

Written on August 19, 2011 by CJ Brasiel in Buyers' Tips, Market Information, Short Sale

Q -So I just made an offer on a short sale where the seller received a NOD almost 60 days ago. The seller agreed to the terms, so my question is how long do I have to typically wait to see if the seller’s lender disapproves or approves the offer. Their lender is BofA and that is my lender as well does that help the process any. Answer: There is no way of predicting short sale timing. 1.) Is it HAFA pre-approved? With an agreed upon list price? Or was this the list price the agent/seller chose? 2.) Is it one lender or more? Are there other liens? (HOA, garbage, mechanics?) 3.) Is the loan(s) being short sold portfolio loans (owned by initiating bank) or by investors? Was it previously a CountryWide loan? 4.) Is there mortgage insurance attached to the loan? 5.) How does the offer price compare to other neighborhood sales? Will the bank believe the offer price is a fair price based on recent sales or will they counter at a higher price? 6.) How on top-of-it is the agent? Do they call weekly (sometimes more)? Is the file complete? Does the agent provide a weekly update to buyer’s agent? 7.) Did the seller provide all the appropriate paperwork? Are they working well with bank and agent to answer any request in a timely manner? I have had Bank of America short sales with two loans approved in less than 45 days – non HAFA. With HAFA 60-90 days. (Strange as HAFA was suppose to shorten timelines.). I would suggest you try to get some word on whether or not the NOD (Notice of Default) has been issued, whether or not the short sale negotiator has actually been assigned, and whether or not the foreclosure process is…

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Where are the real estate deals in San Jose?

Written on August 19, 2011 by CJ Brasiel in Market Information

Recent housing reporting has been all over the place. The price range between $300,000 – $600,000 is still very competitive with some listings going for 101% to 103% to list price. But there are strong indicators that the above $700,000 market is going to start feeling price pressure. Why? When the housing bust started, the government increased the high income area loan limit to $729,750. That meant that if you qualified you could place as little as 3.5% down on a home as long as your loan limit did not exceed $729,750. “The number of $500,000-plus homes sold dropped 25.4 percent month-to-month and 19.2 percent year-over-year, while sales below $500,000 fell 17.1 percent month-to-month and increased 3.5 percent from a year ago.” Data Quick But now, that has been reduced to $625,500. This means the buying pool for FHA loans will be reduced. In February 2010 nearly 20% of all loans were FHA in the San Jose/Silicon Valley area. Prior to 2009, the number of FHA loans were 0% because the conforming loan limit was $417,000. So, some are predicting a 3-5% reduction in buyers being able to afford over $700,000 for the remaining of 2011. There are movements in Congress to extend the higher limits but lenders have already stopped accepting applications. Active listings consist of Short sales, about 30% of the market while REO/bank owned homes are about 10%. Highest demand areas are currently good school areas which is driven by parents trying to find homes before the school year starts. As always, the best homes, in pristine move-in condition, in the best neighborhoods, i.e. schools, are selling first for the most money with multiple offers. But where are the deals? Talking with investors, even the court house steps are not providing many deals. An investor I spoke…

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Forcing Teachers into Foreclosure: Thank you Governor Brown

Written on July 28, 2011 by CJ Brasiel in Market Information

The challenge with being involved in your government is having the time and energy to dig through the information to find the facts. Most of the time, the average citizen (like myself) only reacts to a public policy change when it lands on our doorstep. I have been following the debate regarding Governor Brown’s shutting down of the state’s Redevelopment Agencies. I have attended many functions over the last year where developers swore that this would have a huge impact on their ability to develop homes for “in-fill” areas. Simply put, without government subsidies it would not be cost effective to create new town homes in a transitional neighborhood of San Jose because affordability would be out of reach for the average resident. If you listened to the debates, why should property taxes go to big developers? Pet projects like parking garages in Los Angeles and high rises in San Jose, were considered foolish in a time of economic recession. Makes sense to stop providing subsidies to wealthy builders. Or so it seemed at first glance. But redevelopment money is not just for big developers. Redevelopment money was intended to rebuild neighborhoods by providing encouragement to builders to take a risk. Redevelopment money was meant to fuel jobs in areas of the county where there were very few jobs to be had. Redevelopment money was meant to provide an opportunity for lower income families to own a home. Redevelopment money was meant to support public servants like teachers and firefighters the ability to afford a home in Silicon Valley when their salaries alone where not enough. The Governor was successful at making sure developers did not get subsidies. But what he also did is gave teachers and other public servants no choice but to accept foreclosure. Why? If a teacher…

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