Yesterday I posted on Facebook that 4 media giants were all saying that now is the time to buy a house. I also had an office meeting that reiterated this point.
1. Here in San Diego county prices are way down, making homes so much more affordable than in recent years. Locally the value has dropped by 5%-7% since earlier this year.
2. Inventory is up. There are many great properties to chose from. The odds of you finding a home that really suits your needs has never been better.
3. Interest rates are very low. Yesterday, FHA and VA rates were at 4.25%! It is unlikely that they will go lower. Fannie Mae and Freddie Mac are predicting interest rates to go up by 1% by year end.
You may be asking yourself why you should buy if prices are dropping and that is a good question. First you ned to understand that their is difference between "price" and "cost". The "price" is the purchase price, the amount the home sold for. The "cost" is how much you will pay for the loan, your monthly payment and how much you will pay over the long run.
When I work with buyers they are typically most interested in how much their monthly payement will be and if that payment is affordable. But at the same time they seem to get hung up on the price. This could hurt them in the end. They are concerned about "prices" declining and want to wait for the bottom to purchase. But the reality is no one knows where the bottom is until prices start to go back up and you have missed the bottom anyway. Not only that but the same property will now "cost" them more. Did you know that a property's value would need to decline by about 10% in order to come close to compensating for a 1% increase in interest rates!
Investors always seem to be ahead of the general public when it comes to buying at the right time. They do not wait until it is too late. What are investors doing now? They are buying! Last month 39% of the real estate transactions were bought by investors. More specifically, last week for one listing, 4 cash offers came in. These investors had proof of funds of over $10,000,000. These people know what they are doing! They have amassed a fortune by timing things correctly. They know the returns are coming in, properties are cash flow, the returns exceed the current stock market and most importantly that NOW is the time to buy.
Here are the links to the articles I referenced yesterday. Take a look and think about it. If you are planning on buying, don't put it off. Call me today!
Wall Street Journal
CBS Money Watch
Forbes Magazine
National Public Radio
Showing posts with label Prices Hit Bottom. Show all posts
Showing posts with label Prices Hit Bottom. Show all posts
Wednesday, June 15, 2011
Thursday, July 29, 2010
S.D. home prices up 12.4% in May
BY JENNIFER DAVIES UNION-TRIBUNE STAFF WRITER
ORIGINALLY PUBLISHED JULY 27, 2010 AT 6:49 A.M., UPDATED JULY 27, 2010 AT 2:58 P.M.
San Diego home prices increased 12.4 percent in May from a year ago and San Diego was the only metro area in the country with 13 months of consecutive increases in home prices, says the latest Standard & Poor’s Case-Shiller Home Price Index released Tuesday.
San Diego’s increase was the second highest of the 20 metro areas surveyed, with San Francisco taking the top spot with an 18.3 percent increase.
On a monthly basis, San Diego saw its home prices increase 1.1 percent. Since spring is one of the busiest times for home selling, Case-Shiller also provides seasonally adjusted numbers, which showed San Diego with a slightly lower increase at 0.6 percent.
On a nationwide level, prices in the 20 metro areas Case-Shiller tracks were up 4.6 percent from May 2009.
Despite the increases, there are plenty of reasons to be pessimistic about the housing market for the rest of the year.
While prices nationally have improved from the lows hit in April 2009 — San Diego hit its Case-Shiller low in May 2009 — they’ve essentially been flat for much of the past seven months. According to Case-Shiller’s index, home prices in San Diego are at about the same level they were in June 2003.
Maureen Maitland, vice president of Index Services at Standard & Poor’s, said the end of tax credits and the busiest home-buying season means there is little else to prop up home prices.
“Sure, April and May look good. But you have to look at the trends,” she said. “Going forward, all bets are off. You need true economic recovery for the housing market to be sustained.”
Kelly Cunningham, an economist with National University System Institute for Policy Research, said he doesn’t foresee the San Diego region going through another gut-wrenching drop in housing prices but he also doesn’t see any eye-popping gains, either.
“It’s going to be kind of stagnant is the best way to put it,” he said.
Still, stagnant might not be all that bad when compared to other parts of the country. San Diego and other California cities have been performing better than their counterparts in the Sunbelt because they didn’t go through frenzied building sprees during the bubble.
“In coastal California, we have constrained housing development,” Cunningham said. “It comes back down to supply and demand. We don’t have the problems that Las Vegas, Phoenix or even Riverside have.”
Jennifer Davies: (619) 293-1373; jennifer.davies@uniontrib.com
ORIGINALLY PUBLISHED JULY 27, 2010 AT 6:49 A.M., UPDATED JULY 27, 2010 AT 2:58 P.M.
San Diego home prices increased 12.4 percent in May from a year ago and San Diego was the only metro area in the country with 13 months of consecutive increases in home prices, says the latest Standard & Poor’s Case-Shiller Home Price Index released Tuesday.
San Diego’s increase was the second highest of the 20 metro areas surveyed, with San Francisco taking the top spot with an 18.3 percent increase.
On a monthly basis, San Diego saw its home prices increase 1.1 percent. Since spring is one of the busiest times for home selling, Case-Shiller also provides seasonally adjusted numbers, which showed San Diego with a slightly lower increase at 0.6 percent.
On a nationwide level, prices in the 20 metro areas Case-Shiller tracks were up 4.6 percent from May 2009.
Despite the increases, there are plenty of reasons to be pessimistic about the housing market for the rest of the year.
While prices nationally have improved from the lows hit in April 2009 — San Diego hit its Case-Shiller low in May 2009 — they’ve essentially been flat for much of the past seven months. According to Case-Shiller’s index, home prices in San Diego are at about the same level they were in June 2003.
Maureen Maitland, vice president of Index Services at Standard & Poor’s, said the end of tax credits and the busiest home-buying season means there is little else to prop up home prices.
“Sure, April and May look good. But you have to look at the trends,” she said. “Going forward, all bets are off. You need true economic recovery for the housing market to be sustained.”
Kelly Cunningham, an economist with National University System Institute for Policy Research, said he doesn’t foresee the San Diego region going through another gut-wrenching drop in housing prices but he also doesn’t see any eye-popping gains, either.
“It’s going to be kind of stagnant is the best way to put it,” he said.
Still, stagnant might not be all that bad when compared to other parts of the country. San Diego and other California cities have been performing better than their counterparts in the Sunbelt because they didn’t go through frenzied building sprees during the bubble.
“In coastal California, we have constrained housing development,” Cunningham said. “It comes back down to supply and demand. We don’t have the problems that Las Vegas, Phoenix or even Riverside have.”
Jennifer Davies: (619) 293-1373; jennifer.davies@uniontrib.com
Wednesday, June 16, 2010
More Sales, Higher Prices May Indicate Shift in California Housing Market
Wednesday, June 16th, 2010, 11:15 am
The housing market in California showed rising sales and prices in May, indicating a possible shift in local areas.
Home sales in Southern California rose in higher-priced areas, while sales are accelerating in San Francisco. The monthly rate of mortgage defaults and subsequent level of foreclosures also drew back last month.
As discounted bargains dried up in SoCal's lower-cost inland areas, sales migrated to higher-priced coastal neighborhoods over the past year, according to San Diego-based real estate information provider MDA DataQuick.
A total 22,270 new and resale houses and condos closed escrow in May in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. It marked a 9.7% increase from the month before and a 7.2% increase from the same time a year earlier.
Tax incentives and low mortgage rates fed sales in mid- to high-end areas, where sellers have become more motivated over the last year, MDA said. The median sales price in SoCal jumped $20,000, or 7%, from April to $305,000. The median sales price, which topped $300,000 for the first time in 20 months, is now 22.5% higher than the same time last year.
"Last month's jump in the regional median sale price is the flipside of what we saw a year ago, when low-cost inland foreclosures dominated and sales in the costlier coastal towns struggled for a pulse," said MDA DataQuick president John Walsh. "Today the bargains on foreclosures are fewer and farther between, and the high-end is approaching a normal sales rate."
Walsh added: "The important thing to remember, though, is that what we saw in May was partly driven by government stimulus. In the second half of the year the market will have to stand on its own again, barring new forms of government involvement. Prices will be tested if there's any sudden move by lenders to release a flood of distressed properties."
North along the Californian coast, the San Francisco housing market is seeing a bit of its own revival. Home sales activity is accelerating, working inventory down from historic highs, according to the San Francisco Association of Realtors.
"As closed sales activity has rebounded, sellers have regained some leverage in negotiations," says Association president John Lee, in a statement. "Prices at the low-end of the market are stable while pricing volatility in higher-priced segments remains."
The median single-family home price rose slightly on a yearly basis to $752,500 in May. Despite the relatively flat appreciation, pricing conditions appear stable, according to the Rosen Consulting Group, a California-based real estate and regional economics research consulting firm.
"Rising housing affordability, driven by attractive pricing and low mortgage rates combined with a more optimistic view of the economy assisted by government incentives have brought buyers back to the market," the Rosen Consulting Group said in a statement.
"Recognizing the shifting market conditions, sellers who have been waiting for more favorable market conditions to place their homes on the market should begin to do so in coming months."
Writen by Diana Golobay.
http://www.housingwire.com/2010/06/16/more-sales-higher-prices-may-indicate-shift-in-california-housing-market
The housing market in California showed rising sales and prices in May, indicating a possible shift in local areas.
Home sales in Southern California rose in higher-priced areas, while sales are accelerating in San Francisco. The monthly rate of mortgage defaults and subsequent level of foreclosures also drew back last month.
As discounted bargains dried up in SoCal's lower-cost inland areas, sales migrated to higher-priced coastal neighborhoods over the past year, according to San Diego-based real estate information provider MDA DataQuick.
A total 22,270 new and resale houses and condos closed escrow in May in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. It marked a 9.7% increase from the month before and a 7.2% increase from the same time a year earlier.
Tax incentives and low mortgage rates fed sales in mid- to high-end areas, where sellers have become more motivated over the last year, MDA said. The median sales price in SoCal jumped $20,000, or 7%, from April to $305,000. The median sales price, which topped $300,000 for the first time in 20 months, is now 22.5% higher than the same time last year.
"Last month's jump in the regional median sale price is the flipside of what we saw a year ago, when low-cost inland foreclosures dominated and sales in the costlier coastal towns struggled for a pulse," said MDA DataQuick president John Walsh. "Today the bargains on foreclosures are fewer and farther between, and the high-end is approaching a normal sales rate."
Walsh added: "The important thing to remember, though, is that what we saw in May was partly driven by government stimulus. In the second half of the year the market will have to stand on its own again, barring new forms of government involvement. Prices will be tested if there's any sudden move by lenders to release a flood of distressed properties."
North along the Californian coast, the San Francisco housing market is seeing a bit of its own revival. Home sales activity is accelerating, working inventory down from historic highs, according to the San Francisco Association of Realtors.
"As closed sales activity has rebounded, sellers have regained some leverage in negotiations," says Association president John Lee, in a statement. "Prices at the low-end of the market are stable while pricing volatility in higher-priced segments remains."
The median single-family home price rose slightly on a yearly basis to $752,500 in May. Despite the relatively flat appreciation, pricing conditions appear stable, according to the Rosen Consulting Group, a California-based real estate and regional economics research consulting firm.
"Rising housing affordability, driven by attractive pricing and low mortgage rates combined with a more optimistic view of the economy assisted by government incentives have brought buyers back to the market," the Rosen Consulting Group said in a statement.
"Recognizing the shifting market conditions, sellers who have been waiting for more favorable market conditions to place their homes on the market should begin to do so in coming months."
Writen by Diana Golobay.
http://www.housingwire.com/2010/06/16/more-sales-higher-prices-may-indicate-shift-in-california-housing-market
Tuesday, May 19, 2009
Home Prices Have Hit Bottom
As the following explains, many feel that home prices have hit bottom. I agree that if left up to buyers and sellers this would be the bottom. We are seeing multiple offers at or above the listed price which indicates the properties could sell for more except for one very important player. This player is the lenders. The lenders are continuing to devalue property by requiring an appraisal with at least one sometimes 2 comparables must have sold for more. This is creating a perpetual declining market. Also with the banks flooding the market with houses priced under market, looking for a quick cash deal they are further driving down the comps. The lenders are forcing the market lower by listing properties so low and making it tough for buyers to get a loan with the appraisal situation.
The second part of the article discusses the seller’s perspective of home prices. This is very true. Seller's often times feel that their property is exempt from the issues affecting the rest of the market. They feel their property is worth more than the one down the street. Some like overlook the any negatives about the property and see pink carpet and paneling as a reason their house is worth more than the neighbors. I try to explain that the reality is, their house’s value has declined and that even if a buyer comes along and is willing to pay over market value, they will not be able to get the loan. Many times the seller lists the home with the agent that tells them everything they want to hear as opposed to one who was upfront with them from the start. It can be difficult to watch as the property languishes on the market as prices continue to decline. So keep this in mind if you are considering selling your home, if the list price sounds too good to be true, it probably is.
Daily Real Estate News | May 19, 2009 | Share
Practitioners Say Homes Prices Have Hit Bottom
Real estate professionals are optimistic that home prices will hit bottom in the next six months, according to a survey from listing and home-pricing site HomeGain.com.
About half of practitioners surveyed expect home prices to stay the same in the next six months, 29 percent expect them to drop, and 22 percent believe they will increase.
More than 84 percent of practitioners believe their clients’ homes lost value in the last year, while 12 percent say values had stayed the same. Only 3 percent believe homes had gained value.
Meanwhile, sellers were skeptical of their real estate professional’s analysis, with 69 percent believing their homes were worth more than the practitioner recommended. About 35 percent of home sellers thought their home was worth 10 percent to 20 percent more, and 10 percent thought their home was worth at least 21 percent more than their real estate professional suggested.
Source: Inman News (05/18/2009)
The second part of the article discusses the seller’s perspective of home prices. This is very true. Seller's often times feel that their property is exempt from the issues affecting the rest of the market. They feel their property is worth more than the one down the street. Some like overlook the any negatives about the property and see pink carpet and paneling as a reason their house is worth more than the neighbors. I try to explain that the reality is, their house’s value has declined and that even if a buyer comes along and is willing to pay over market value, they will not be able to get the loan. Many times the seller lists the home with the agent that tells them everything they want to hear as opposed to one who was upfront with them from the start. It can be difficult to watch as the property languishes on the market as prices continue to decline. So keep this in mind if you are considering selling your home, if the list price sounds too good to be true, it probably is.
Daily Real Estate News | May 19, 2009 | Share
Practitioners Say Homes Prices Have Hit Bottom
Real estate professionals are optimistic that home prices will hit bottom in the next six months, according to a survey from listing and home-pricing site HomeGain.com.
About half of practitioners surveyed expect home prices to stay the same in the next six months, 29 percent expect them to drop, and 22 percent believe they will increase.
More than 84 percent of practitioners believe their clients’ homes lost value in the last year, while 12 percent say values had stayed the same. Only 3 percent believe homes had gained value.
Meanwhile, sellers were skeptical of their real estate professional’s analysis, with 69 percent believing their homes were worth more than the practitioner recommended. About 35 percent of home sellers thought their home was worth 10 percent to 20 percent more, and 10 percent thought their home was worth at least 21 percent more than their real estate professional suggested.
Source: Inman News (05/18/2009)
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