First I must apologize profusely for my lack of updating this blog in the last couple of months. If you stop by regularly, you know that I try to update our blog on a regular basis, but with all of the changes that have been occurring in the mortgage and real estate markets it has been quite hectic.
So, I think a good way to kick off a new blog update, and my first one for 2008 is to let you know where we are today. At this point, unless you have been living under a rock, you are aware that we are in a challenging real estate market. For months now we have been getting the barrage of news every night telling us how bad the real estate market is, how there is a glut of inventory, and foreclosure rates are soaring. In reality, the market is challenging, if you are a seller, it is going to take a while for your home to sell and you MUST price appropriately. With that said, I would say that it is no where near as bad as what we see on the news. Watching TV you are liable to think that owning property is a mistake, but most people know that in the long run real estate is a great investment. The current state of the market is a correction from the soaring increases we had in the last 3 to 5 years. At this point I think we are starting to swing a bit too much in the direction of correcting to the down side... In my opinion 2008 will be a good year to get back into the market. I think we should probably be seeing the bottom sometime in the middle of this year, with a flattening out after that for a year or two.
In regards to some statistics, the below price averages are from a Data Quick article dated January 17, 2008. These stat’s show that as expected we have seen price declines everywhere on average over the last year. This is in addition to the declines we saw in 2006. To read the entire article, go to http://www.dqnews.com/RRBay0108.shtm
All Homes
Number SoldDec-06
Number SoldDec-07
PercentChange
MedianDecember 2006
MedianDecember 2007
Alameda
1,589
983
-38.1%
$589,000
$540,000
-8.3%
Contra Costa
1,788
971
-45.7%
$569,500
$505,000
-11.3%
Marin
268
193
-28.0%
$804,750
$760,500
-5.5%
Napa
127
72
-43.3%
$590,000
0.0%
Santa Clara
2,106
1,265
-39.9%
$656,000
$655,000
-0.2%
San Francisco
589
445
-24.4%
$745,000
$731,000
-1.9%
San Mateo
685
468
-31.7%
$735,000
$733,500
Solano
622
360
-42.1%
$439,500
$370,000
-15.8%
Sonoma
598
308
-48.5%
$525,000
$410,000
-21.9%
Bay Area
8,372
5,065
-39.5%
$618,000
$587,500
-4.9%
Although everywhere is showing an average price decrease, you must drill down further into individual cities, not counties to see how we are doing. Some cities like Oakland, Antioch, and Hayward are dropping quite a bit more than average in Alameda County, while other cities in the same county such as Pleasanton and Castro Valley are holding up better than average. It really depends on your neighborhood, but a good rule of thumb is the more sub-prime loans that were issued in your neighborhood, the further your price has dropped.
I hope you found some of this information useful. You will be getting more regular updates in the future from me, and again I apologize for the delay in posting this. Remember, if you need any assistance in regards to real estate, do not hesitate to contact us, until next time…
Thanks for stopping by the East Bay Real Estate Blog. So the recent home sales numbers just came out for the East Bay, and as I expected, they show some areas holding up a lot better than others. Below you will see home sale totals for August. Some areas like Union City seem to be keeping up pretty well. I suspect this is due to their proximity to Silicon Valley where jobs are plentiful. In the outlaying areas pain is becoming very severe. Take Antioch for example, which is showing a staggering 25%+ price drop in average home sale price from August of last year. These outlaying communities which grew tremendously in the last decade and see lots of commuters normally always get hit harder during real estate downturns.
As I mentioned in previous posts, many cities where the average price was lowest also had a larger percentage of sub-prime loans. During the boom those cities had huge price increases; they are also falling on hard times now. Another example being Stockton, CA which now as the dubious honor of the foreclosure capital of the United States. One article on www.cnbc.com says that 1 out of every 34 homes there is now in foreclosure. It will take some time for these areas to recover. The more expensive and more desirable areas however, are just returning to normal.
County/City
# Sold
August 2007
August 2006
% Change
Alameda County
992
$625,000
$600,000
4.17%
ALAMEDA
67
$690,000
5.34%
ALBANY
15
$672,500
-10.78%
BERKELEY
56
$750,000
$706,500
6.16%
CASTRO VALLEY
37
$580,000
$645,000
-10.08%
DUBLIN
40
$629,500
$677,500
-7.08%
EMERYVILLE
26
$428,000
$425,000
0.71%
FREMONT
165
$646,500
$640,000
1.02%
HAYWARD
62
$498,500
$565,000
-11.77%
LIVERMORE
71
$646,000
$610,000
5.90%
NEWARK
23
$605,000
-4.13%
OAKLAND
238
$577,500
$535,000
7.94%
PLEASANTON
78
$792,500
$770,000
2.92%
SAN LEANDRO
50
$480,000
$550,000
-12.73%
SAN LORENZO
12
$506,250
-12.72%
UNION CITY
52
19.09%
Contra Costa County
1,100
$575,000
$579,000
-0.69%
ALAMO
20
$1,587,500
$1,524,500
4.13%
ANTIOCH
85
$385,000
$517,500
-25.60%
BRENTWOOD
$515,000
-19.53%
BYRON
34
$535,750
$599,000
-10.56%
CLAYTON
16
$635,000
$775,000
-18.06%
CONCORD
91
$500,000
$545,000
-8.26%
DANVILLE
112
$942,000
$1,000,000
-5.80%
EL CERRITO
22
3.20%
EL SOBRANTE
11
-12.17%
HERCULES
$581,250
-1.06%
LAFAYETTE
38
$1,212,500
$1,147,500
5.66%
MARTINEZ
48
$504,750
-3.86%
MORAGA
$1,008,000
$882,500
14.22%
OAKLEY
51
$468,000
$542,000
-13.65%
ORINDA
$950,000
$1,328,250
-28.48%
PINOLE
$512,500
-1.46%
PITTSBURG
44
$406,000
$460,000
-11.74%
PLEASANT HILL
36
$585,250
-12.97%
RICHMOND
70
$437,000
$430,000
1.63%
RODEO
2
$380,500
-27.52%
SAN PABLO
25
$490,000
-10.82%
SAN RAMON
145
$813,000
$800,000
WALNUT CREEK
104
$620,500
-8.41%
We hope you find this information helpful and useful. Please remember we are here to assist you with all of your real estate needs, until next time…
We received some good news today from the Federal Reserve, which cut the Federal Funds rate by 0.5 point. Although the federal funds rate does not directly affect all mortgage rates, it does have an indirect affect, and this most recent move by the fed is bound to move mortgage rates lower. The markets had already priced in a 0.25 point move by the fed, but the more aggressive half point cut was a bit of a surprise and the stock markets rallied on the news.
This is good news for housing. The real estate market has been hit hard lately with all of the bad news about subprime, it is nice to see some good news starting to come out. The below article from CNN has a good perspective on how this move by the Fed may help housing.
http://money.cnn.com/2007/09/18/real_estate/low_impact_rate_drop/index.htm?postversion=2007091815
So what does this mean for our blog readers? Well for one, if you are on the fence about buying real estate, this should be the push you needed to get off the fence. Lower rates will undoubtly mean an increased demand for housing. This however will take 6 to 8 months to work itself into the economy. We won’t see prices stabilize immediately, but lower rates will increase demand. If you want to take advantage of the strong buyer’s market we are in now, and be able to aggressively negotiate, you need to start looking now.