cbmarketwatch-sacramento

We've Moved!

2009-12-17T16:48:00.001-08:00

Check out our new blog located at http://cbsactahoemarketwatch.wordpress.com/.

Tax Credit and a Seasonal Market Adjustment as We Prepare for 2010

2009-12-04T08:50:00.000-08:00

It is nice to know that our long wait is over and we now know the results of the tax credit. The very fortunate news is that the government addressed two key markets as part of its extension and expansion efforts:

1. A $6,500 tax credit for existing homeowners who are in the market for a new home.
2. An extension of the $8,000 tax credit for first-time home buyers.

The extended deadline requires that consumers go into contract by April 30, 2010 and close by June 30, 2010.

Under the new requirements, an estimated 2 million Americans are expected to claim the tax benefit. The IRS estimates 1.4 million people have already claimed earlier versions of the first-time home buyer credit.

What I can tell you about the tax credit is that it was the single most important factor in improving our market. And we didn’t really fully realize the benefits it was making on our market until we saw a sudden surge in units closed and increased showings in September, October and November as consumers grew closer to the deadline. Once the deadline was extended, we saw an immediate adjustment, which shows just what an impact it has had on our market.

Also in recent news, NAR released its monthly pending home sales report which showed that sales have risen for nine months in a row, a first for the series of the index since its inception in 2001. A forward looking indicator based on contracts signed in October, the report showed a 3.7 percent to 114.1 from 110.0 in September and is 31.8 percent above October 2008 when it was 86.6. The rise from a year ago is the biggest annual increase ever recorded for the index, which is at the highest level since March 2006 when it was 115.2.

Of course it is important to point that the housing market has been underperforming for most of the past year so I would caution not to get too excited about these numbers. But the positive news is that it does show that the tax credit is working.

Now that we’re in the thrust of the holidays, I fully anticipate a seasonal market adjustment. But we also recognize that the New Year is just a few weeks ago and, if history is an indicator, we will see a large number of listings coming on the market during that time. Many of our Agents are working hard now to prepare their listings for the market in the New Year so the coming month should bring some positive new inventory to the marketplace.

Now, let’s take a look at this week in real estate:

AUBURN:
Listing inventory in the Auburn area remains low as does the sales inventory. Projections for the remainder of the year are limited, especially since we are used to seeing many bank owned properties- the lenders are unlikely to release many until after the first of the year.
Activity was higher for Ratified offers, and we saw only four multiple offers. Open home activity was also low, mostly due to the holiday period. The good news is that buyers are not only serious, but qualified as well.

The floor calls seem to be a good source for some of our most recent sales. It is quiet in the foothills and the agents that are working with buyers are still writing multiple offers and not getting an accepted contract. We have had a few more short sales approved and closed

DIXON:
Here’s some great news: both listing and sales inventory here is increasing- even though they are short sale transactions, we are happy that there is inventory to sell! Additionally, all listings are getting multiple offers! We didn’t have any open homes this past period due to the holiday weekend. A lot of buyer activity but low inventory in Dixon slows us down- looking forward to seeing more inventory after the 1st of the year.

FAIR OAKS:
The inventory is still down for the past two weeks. On the positive side, bank owned homes are selling as soon as they come in and we are seeing more traditional sales. Sales inventory is also slower the past two weeks. The agents are thinking it is because of the non-release of REOs, and nearly all of the offers are in multiple offer situations.

Numbers for ratified offers are up this month. The agents working with the buyers are finally getting accepted. A few of my listing agents have short sales going on and a few REO listings are selling immediately. The key is the pricing for our listing teams…

Open Houses have been a little slower this past two weeks. The weather was slightly warmer and not as many buyers were out there this week we are scheduled for approximately 8 to 13 scheduled Open Houses.

The Short Sales have really taken off and this is where the market is headed for. Also real sellers are considering selling. You must remember people sell and buy in any type of market. Transfer moving up buyers with larger families down sizing etc.

Buyers are still out there looking but with low inventory and multiple offers, it is highly completive. That doesn’t even calculate appraisal issues!

FOLSOM:
Inventory is on the up-tick- steady with 12 new listings and slightly increasing sales inventory. We had 21 ratified offers- with half being traditional sales!

We have to echo the rest of the offices with Open Home activity being slow due to the holiday period and good weather.

Although we don’t have any activity on our listings over $750,000 several agents are working with buyers in this price range.

The agents that are still working thru the holidays are being rewarded and the business is spread out to many agents. We had 21 new sales turned in by 15 different agents, 12 new listings turned in by 12 different agents and 20 recordings with 13 different agents. So …32 of the Folsom agents had at least one piece of business this past 2 week period. Not bad!

ROSEVILLE- GRANITE BAY:
While listing inventory is steady, the sales are decreasing. We are seeing multiple offers on a regular basis with several on short sales. Active short sales are dominating market at this time—hopefully we will see much more inventory after the first of the year!

ROCKLIN- LINCOLN:
Listing inventory is slow! As for sales, the homes that are priced under $250,000 are sold quickly with multiple offers- one property receiving 23 offers! We had 14 open homes but with light traffic.

We have several short sales approved and closed. We have just ended an escrow with a “buyer” that appeared to have given us some incorrect information that just seems to solidify the fact that we have some creative buyers and others that may be trying to structure a transaction that might be fraudulent. As such, we are being very careful to ask better questions and make sure the disclosures are handled properly and communications verified. There seems to be more activity in the direction of Beal Air Force Base.

A couple of our agents invited an airman stationed at Beal to join them for Thanksgiving. The airman, from Georgia, was new to the area and had no family or friends close by and they wanted to make sure he had a special Thanksgiving. They planned some activities for that day, however, since he did not have a TV he was more than happy to watch football all day!!!

TAHOE- TRUCKEE AREA:
Active Listings: The active listing inventory for the Tahoe-Truckee dropped 5% from last week. Currently there are 1,784 active listings - 1,195 residential properties and 589 lots and land listed for sale.

Active Listings - REO’s and Short Sales: Of the active listings, there are 171 properties listed as short sales, (9.6%) and 69 properties listed as REO sales, (3.9%). While less than 13% of the active listings are short sales and REO’s, roughly 24% of the properties selling are short sales and REO’s.

Months of Inventory: Based on the current inventory and sales for the previous 30-day period, the market has roughly 13-months of inventory available. The inventory of homes and land at today’s prices bodes extremely well for buyers interested in entering or moving up in the Tahoe-Truckee market.

Sales Summary:

Total Sales Year-to-Date 2009 Vs 2008:
On a year to date (YTD) basis there have been 978 properties sold in the market as compared to 955 for the same period in 2008. The last half of the year has seen a dramatic turnaround in sales from the first half of the year.

For properties sold YTD 2009, 151 were REO’s, (15.4%), and 80 were Short Sales, (8.2%) which results in almost 24.0% of the properties sold being a short sales or REO.

For 2009, there have been 564 properties sold priced below $500,000, 310 properties sold between $500,000 and $1,000,000 and 104 properties sold over $1,000,000.

Median and Average Sales Prices 2009 Vs 2008: The median sales price for properties sold YTD in 2009 is $450,000 while the average sale price is $590,028. For the same period in 2008, the median sales price was $501,500 and the average sales price was $720,146 which is an (10.3%) and (18.1%) reduction in price respectively for one year.

Last Week’s Sales: For the week of November 23rd to November 29th sales decreased substantially from the previous week to 18 sales mostly we suspect because of the Thanksgiving holiday. Of the properties sold last week, six (6) of those sold at a price above $750,000. In fact, one property sold was a Lakefront at $3,150,000 and the other large sale was $2,165,000. While homes under $600,000 are selling more rapidly than most, the large sales that occurred last week still point to the fact that homes priced right are being purchased by savvy buyers.

Pending Sales: Pending sales remained constant at 169 properties.

Market Activity Summary:

With December and the winter months approaching we remain encouraged that buyer interest in our market will remain good as our inventory is plentiful and sales prices are at 2003-2004 levels. Homes priced below $600,000 are where the most sales activity is occurring with multiple offers are commonplace. The upper end of the market is moving a bit slower but homes priced well are definitely in demand. Coldwell Banker currently has over 40 homes in escrow scheduled to close in the next 30-60 days.

Tahoe-Truckee Homes Prices are at 2003-04 Levels…

This week I’ll leave you with a few good articles of note:

• Whither Real Estate's Comeback; Forbes
• Mortgage Applications Increase In Latest MBA Weekly Survey; Mortgage Bankers Association
• Home Sales Contracts Soar In October; CNN Money
• Credit Helps To Lift U.S. Home Sales; NY Times

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento

Exciting New Opportunities for Existing Homeowners and First Time Home Buyers!

2009-11-05T16:39:00.000-08:00

I have some good news to share with you. The U.S. House of Representatives voted by an overwhelming 403-12 margin to approve the Unemployment Compensation Extension Act (H.R. 3548) that included, as an amendment, the extension and expansion of the Homebuyer Tax Credit. The bill already passed in the U.S. Senate yesterday by a vote of 98-0, so now it will advance from Congress to the White House for President Obama’s signature. It is one step away from being signed into law, and the Administration already has signaled its support of the Homebuyer Tax Credit amendment as well as the President’s intention to sign the bill.

This is an historic moment for our industry as well as the culmination of more than a year’s worth of hard work and meetings with elected officials and policy makers on the part of Realogy management. I am both proud and appreciative of how so many of our employees, franchisees and sales associates participated in various grass roots outreach efforts with Congress. Our Company’s efforts on Capitol Hill truly helped make a difference on this issue.

Again, this bill is now one step away from becoming law. Our voices were heard in Washington, D.C., and we should be proud that our government is taking strong action to help our industry and the economy. Having an extended and expanded Homebuyer Tax Credit available to qualified homebuyers through the first half of 2010 undoubtedly will benefit our business and the U.S. economy.

The new bill calls for an incentive for buyers who have owned their current homes at least five years, making them eligible for tax credits of up to $6,500. First time homebuyers – or anyone who hasn’t owned a home in the last three years – would still get up to $8,000. To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010 and close by June 30.

The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

The credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.

As an industry, we are certainly pleased that the tax credit may be extended and expanded. The key to returning stability to the economy lies within the housing market, and we have crafted a meaningful credit that will create a strong foundation for future growth and make a measurable difference over the next seven months in our economy.

Furthermore, tax credits like this only work by creating the sense of urgency to take advantage of them. This is said to be the last extension of the home buyer tax credit and I urge people – whether they’re first time home buyers who’ve always dreamed of having a home of their own or someone who has been gridlocked in the challenges of our move-up market to take advantage of this opportunity.

In other real estate news, NAR released its pending home sales report this week which showed that pending home sales rose again, making eight consecutive monthly gains—the longest streak since measurement began in 2001.

The report showed pending home sales rose 6.1 percent to 110.1 from a reading of 103.8 in August and is 21.2 percent higher than September 2008 when it stood at 90.9. The gain from a year ago is the largest annual increase on record, and the index is at the highest level since December 2006 when it was 112.8.

I agree with NAR’s assessment that the momentum is based on a rush of first-time home buyers trying to beat the expiration of the tax credit at the end of November. We’re feeling that rush in many of our offices.

As to keep things in perspective I would like to point out NAR’s Chief Economist Lawrence Yun’s comments that “We’re clearly not out of the woods because an excess of homes remain on the market despite recent improvements,” he said. “Although current inventory is getting closer to price equilibrium, foreclosures will continue to enter the pipeline. An extended and expanded tax credit would help absorb this income inventory.” That truly is why we are so pleased with the potential of the bill’s passing.

Now, let’s take a look at this week in real estate:

El Dorado Hills— Inventory is still low and short sales are rising. We have very few REOs but don’t expect to see a flood of activity in that market anytime soon. Buyers are still looking for great deals.
Elk Grove—We are seeing more and more regular sellers. Agents are feeling hopeful that this is a sign of some normalization. Time will tell. Agents that are knocking doors, calling database…good sound fundamental activities are working….
Placerville— October was busy and buyers are out looking for well priced properties. The high end is still slow with a lot of competition from buyers. Inventory is still low with very few REOs which helps our market prices stabilize.
Roseville/Granite Bay— Need fresh inventory. Many short sale offers out!
Sacramento Fair Oaks— The overall market is stabilizing in prices because of the low numbers in our inventory. The real sellers are getting more involved in our market conditions. They are actually getting off the fence and are making decisions on selling and or buying.
Tahoe/Truckee—Active Inventory Summary: Active Listings: The listing inventory for the Tahoe-Truckee market continues to go down as homes sell and homeowners take their homes off the market for winter. Currently there are 1,915 active listings - 1,303 residential properties and 612 lots and land listed for sale. Active Listings - REO’s and Short Sales: Of the active listings, there are 169 properties listed as short sales, (8.8%) and 70 properties listed as REO sales, (3.7%). While less than 13% of the active listings are short sales and REOs, roughly 23% of the properties selling are short sales and REOs. Sales Summary: Last Week’s Sales: For the week of October 26th to November 1st it was the third best sales week of the year with 36 properties sold. Of the properties sold last week, six (6) of those sold at a price above $750,000. Coldwell Banker was involved in 11 of the properties sold. Pending Sales: Pending sales decreased once again to 162 properties from the previous week. Market Activity Summary: With the three strongest consecutive sales weeks of the year it is clearly an indication of buyer’s continued interest in well priced properties and the tremendous values which exist in the market. While visitor activity has fallen off with the fall season, buyers who have been watching the market are seizing this unique time to buy Tahoe-Truckee real estate in a down market. Coldwell Banker currently has over 45 homes in escrow scheduled to close in the next 30-60 days.

I wanted to let you know that we are officially making Weekly Market Watch a once every other week publication. With the market changing very little from week to week we just felt it was an obvious choice. If news or the market warrants, we will return to once per week or we will simply provide you with special editions.

We will return with our next edition of Weekly Market Watch on November 19.

Until then,
Make it a great November,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

It’s On The Table!

2009-10-30T10:15:00.000-07:00

There’s no question. The government’s first-time homebuyer tax credit has spurred a significant amount of sales this year and its positive impact on the hard-hit housing market warrants an extension. Latest estimates show that some 400,000 additional sales occurred this year due to the first time home buyer tax credit, which is about 8% of all sales this year.

The latest news in the saga, The Senate has reached a compromise on extending and expanding the $8,000 tax credit for first-time home buyers. While its passage remains uncertain, the agreement would extend the existing credit for first-time homebuyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners. The reduced credit would be available to all homeowners who have been in their current residence for a consecutive five-year period in the past eight years. Lawmakers in Washington also raised the qualifying income limits to $125,000 for single taxpayers and $250,000 for joint taxpayers, from the current $75,000 and $150,000. Under the Senate compromise, buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement, said the sources. The measure still faces votes in the full Senate and the House.

The U.S. Senate won’t vote until next week at the earliest. As soon as they do we intend to create a piece that will allow you to communicate the news to your clients.

Reports show that Senate action has been delayed by a Republican demand that a vote be allowed on an amendment to end the Treasury Department’s Troubled Asset Relief Program at the end of this year. But lawmakers say they want to prevent home sales from slipping as the economy struggles to recover. And as I mentioned in a previous edition of Weekly Market Watch, that is just what may happen if lawmakers choose to let the tax credit expire.

On the flip side, the Democrats, along with the Obama administration are backing it. “The success of the American economy is closely tied to the success of the housing market; by helping to stabilize the housing market, the homebuyer tax credit has helped to shore up the economy as it begins to recover,” said Baucus, a Montana Democrat. “This would enable an even greater number of potential homebuyers to take the credit.”

Thus far it seems to be doing its job. This week, Business Week reported “The broad improvement in the housing indicators in recent months leaves no doubt that the long-awaited housing recovery is finally under way.” The article went on to report: “Policy alone cannot explain the 24% gain in existing home sales since January, nor the 22% increase in new-home purchases, the 40% rise in single-family housing starts, and the recent upturn in home prices. The primary driver is historically high affordability. Fixed 30-year mortgage rates are at 5%, a multi-decade low, and prices have plunged a total of 30% since May 2006, based on the Standard & Poor's Case-Shiller Home Price Index. By that price gauge, homes are well undervalued relative to both rents and aftertax income.”

Next week I hope to report some positive news on the home buyer tax credit front. Until then, let’s take a look at this week in real estate:

Auburn— Through October 28th there are 24 pendings and 22 closed escrows with an average price of $400,600 for the southwest area and $294,557 for homes within city limits.
El Dorado Hills— October has been a bit busier for new sales but many of them are short sales with buyers and Agents experiencing a lot of frustration. Inventory remains low.
Elk Grove— While short sales and REOs continue to dominate, we are seeing some signs of normalization in the market as traditional sellers are beginning to list and sell. At this point, the affect of this seems to be more psychological than anything else, but it a very positive sign. Buyers are still plentiful and inventory quite low. A comment from one of my Agents sums up the market today nicely: “Real sellers seem to be anxious to take advantage of the low inventory of "real listings". I am experiencing getting more listings that are not short sales or reo properties. I am listing properties for the flip investors. I am still getting multiple (many) offers on the bank owned properties and the poor FHA buyers are really not being able to compete, especially if they need any type of seller contribution for closing costs. There is a very fine line between ‘upping the ante’ and making appraisal.”
Folsom— Listings are still slow but once again, if a property is priced right it will sell and quick! If the new sales this week 40% were sales of our listings by other brokers and 60% we represented the buyer on another brokers listing.
Placerville— Sales have been brisk this month and inventory is still shrinking. A few of our buyers will be very happy to hear that the tax credit has been extended.
Rocklin/Lincoln—Thanks to our new Move-Up Marketer program, we are seeing many good leads and agents have some wonderful stories. One agent now knows the history of a neighborhood and has made a couple of solid contacts in the area. Another came across a possible listing within the first few doors and yet another has a possible new listing and a buyer. Just as importantly, the agents are smiling and are seeing some great responses.
Sacramento Metro—REOs seem to be picking up…just a little. Lots of short sales.
Tahoe/Truckee— Active Inventory Summary: Active Listings: The listing inventory for the Tahoe-Truckee market went down slightly again to its lowest level since May of this year to 2,069 active listings - 1,412 residential properties and 657 lots and land listed for sale. Active Listings - REOs and Short Sales: Of the active listings, there are 169 properties listed as short sales, (8.2%) and 74 properties listed as REO sales, (3.6%). While less than 12% of the active listings are short sales and REO’s, roughly 23% of the properties selling are short sales and REOs. Sales Summary: Last Week’s Sales: For the week of October 19th to October 25th it was yet another record breaking week for the year with 37 properties that sold which was identical to last week and the largest single two weeks of the year. Of the properties sold last week, six (6) of those sold at a price above $750,000. Coldwell Banker was involved in 13 of the properties sold. Pending Sales: Pending sales decreased once again to 182 properties from the previous week. Market Activity Summary: With the two strongest sales weeks of the year back to back, it is clearly an indication of buyer’s continued interest in well priced properties and the tremendous values which exist in the market. While visitor activity has fallen off with the fall season, buyers who have been watching the market are seizing this unique time to buy Tahoe-Truckee real estate in a down market. Coldwell Banker currently has over 43 homes in escrow scheduled to close in the next 30-60 days.
Vacaville-Fairfield— What a great time to be in real estate! Opportunity is knocking in all price ranges! With affordability at an all time high, buyers and investors are out in droves. Most of our markets are back to 2001 prices. So anyone who wanted to buy then, but missed the opportunity is realizing the dream now.
· For our first time home buyers the city of Fairfield and Dixon are both offering First Time Home Buyer Credits in addition to the (just extended) federal $8,000 home buyer credit.
· Because our inventory is so low, our prices are actually creeping up. This has been fantastic for our sellers
· First time and long time investors are snatching up properties that will actually cash flow, allowing them an opportunity for wealth building.
· Dare I say short sales are actually being negotiated by the lenders and more importantly, closing escrow!

Next week I will release the November edition of Reality Check. In it, we focus on the state of the market and include an interview with me. I think you’ll find it helpful and informative in educating your clients and prospects on the current state of the housing market.

Until then,
Make it a great week,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

“U.S. Economic Recovery on Track”

2009-10-22T21:51:00.000-07:00

While we await the results of the possible expiration, extension or expansion of the $8,000 first time home buyer tax credit, one thing is for sure, the economy is moving forward in full force—which is driving consumer confidence. Earlier this week, Reuters.com ran a very interesting story on the U.S. economic recovery and the result was very encouraging. Among the story’s highlights:

“The U.S. economy is firmly poised for a recovery from its deep recession but growth may be moderate and the job market will not revive immediately, senior White House aide Lawrence Summers predicted on Wednesday.”
“On the economy, Summers said the $787 billion stimulus package and inventory rebuilding by businesses were among the “dominant drivers” lifting the economy.”
“It will be some time before unemployment starts to decline. Once it declines it will take a long time to return to normal levels, given how elevated it is…The jobless rate is now at a 26-year high of 9.8 percent.”
“Most private economists think the recession, which began in December 2007, ended in the third quarter. But there is much disagreement about the path to recovery.”
“Some see above-average growth continuing through next year, arguing that deep recessions are typically followed by powerful recoveries, helped along by pent-up demand as consumers and companies resume spending.”

Obviously this is welcome news for the economy which ultimately benefits the local housing market. What I can tell you is that I am encouraged by the progress we are making in the real estate market. We’re beginning to see more days of progress than days of back stepping. We’re watching sales activity and consumer sentiment and we are expecting over the coming months a moderate to a more sustainable pace and we will probably see a modest rise in housing prices in the coming year. Will it be the double digit appreciation we saw in the earlier part of the decade? Probably not. But this new normal (as we’re calling it) is much more sustainable and a much healthier path to build upon. It makes me excited about the future and gives us all hope for a relatively modest and productive 2010.

Now, let’s take a look at this week in real estate:

Auburn--Most short sales are showing as contingent and we need some new listings. The buyers are still waiting for the next surge of REOs and we are using the information provided by the economic report from CAR to show them they should act now. We have gotten a few very good leads from floor. We are also in our 2nd week of the 100 days from Buffini.
Dixon-Davis--Since we have not had any changes in the last few months I ask for quotes from my Agents to see how they are dealing with our market here is one of them: In doing the research for Coldwell Banker’s "Move up Marketing Program,” I am finding that a great number of homeowners do have equity that they can use to purchase another property that better suits their needs or buy property as an investment. In this time of short sales and REOs it is great to see that there can be some "regular" sellers. All we need to do is go to work and let them know of the great opportunity that exists now. It is Real Estate 101. Door knocking and putting your face and name out there. Marianne MacDonald
El Dorado Hills-- Inventory continues to drop with only 329 active listings. Our high last year was over 450. Over 1/3 of the actives are short sales and 2/3 of those have offers waiting for bank approval but the REO’s make up only 5% of our market.
Elk Grove--For September 2009 in the 95624 Zip Code, there were a total of 77 closed sales approximately 43% REO, 27% Short Sales and 30%(28% August) conventional sales. Average sales price was $250k ($230k August) for conventional sales vs. $232 for REO/Short. For 95758 there were 77 sales with approximately 47% REO, 24% Short and 29%( 25% August) conventional sales. While conventional sales average price was $240k, REO’s were $218k and Short Sales were $194k. For 95757, there were 69 sales with 55% being REO, 20% Short Sale and 25% (no change from August) conventional sales. Again, average sales price for conventional sales was considerably higher than REO and Short Sales with averages of $280k, $267k and $247k. The 3 zips combined: 240 closed sales with approximately 47% REO, 24% Short Sales and 29% conventional sales (26% August). From all this, it appears that we are starting to see more conventional sales with average sales prices higher on these sales in 95624 and lower in 95757 and 95758 month over month. No clear trend in sight.
Folsom--We are looking for more listings! Every week we sell our good listings but we are not replacing our inventory! Closings are strong so we are paying the bills, new escrows are being opened so the pipeline is good, and agent attitude is for the most part good. So, I think the last quarter of 2009 will be the start of a better year in 2010!
Placerville--We continue to get walk ins nearly every day from all areas. Inventory is “skinny” and good deals go quickly. Inner office networking is paying off and we’re double ending many of our listings.
Rocklin/Lincoln--Loans are the challenge. It took a week to fund a loan on what should have been a “slam dunk.” We were to fund on Monday but a review of the credit report showed two social security numbers. It turned out the one number was from her ex husband and they had been divorced for 15 years. On top of that there was nothing derogatory but the lender demanded a copy of the divorce decree and then when that was submitted, the lender said they needed proof of the notary being an employee of Old Republic Title and that person had to supply 2 current pay check stubs.
Sacramento Metro--Inventory in our core areas continue to be slow.
Sacramento Sierra Oaks--The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe/Truckee--Active Inventory Summary: Active Listings: The listing inventory for the Tahoe-Truckee market went down slightly again to its lowest level since May of this year to 2,083 active listings - 1,423 residential properties and 660 lots and land listed for sale. Active Listings - REO’s and Short Sales: Of the active listings, there are 167 properties listed as short sales, (8.0%) and 68 properties listed as REO sales, (3.3%). While less than 12% of the active listings are short sales and REO’s, roughly 25% of the properties selling are short sales and REOs. Sales Summary: Last Week’s Sales: For the week of October 12th to October 18th there were 37 properties that sold which was the largest single week of sales in 2009. Of the properties sold last week, nine (9) of those sold at a price above $750,000. Coldwell Banker was involved in 12 of the properties sold. Pending Sales: Pending sales decreased once again to 191 properties from the previous week.
Vacaville-Fairfield--For Solano County we have 1450 active single family homes. 1004 Pending Sale and 245 single family homes have closed escrow in the last 22 days. The lowest selling price as $60K and the highest was $1,556,500. Homes that were on the market 0-30 days sold at 102.68% of their list price and the average days on market to close of escrow is 63 days. As you can deduct from our numbers we are in a robust market with no signs of slowing down.

This week I’ll conclude with a few articles of interest:

What Housing Bust?; CNN Money

Housing Tax Credit Working, So Keep Momentum Going, NAR Urges Congress; Realtor.org
Shape Of The Housing Recovery; CNBC
Real Estate Outlook: Mixed Signals; Realty Times

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Recent Housing Upturn Sparked By Buyer Leverage

2009-10-16T09:59:00.000-07:00

The latest S&P/Case-Shiller home price index reveals home price for 10 major cities rose 3.6 percent between April and July. So does this recent uptick in the housing market mean we are on the cusp of a housing boom?

I hate to burst your bubble but probably not. In all likelihood, the recent upturn in the housing market has been sparked by several competing factors:

· The impending expiration of the $8,000 first-time home buyer tax credit
· The recent uptick in the stock market
· Increased consumer confidence
· Continued low interest rates

Essentially, buyers are playing a leverage game. They’re watching the economic indicators and trying to determine the best time (for them) to buy. It seems many are now pulling the trigger which is causing sales figures and prices to go up.

Will it last? It’s tough to say. Right now we’re in a slightly unique position because some of the stimulus packages that the government instituted are working which may be causing a false front for the overall economy. The stock market is up. Consumer confidence is on the rise. The housing market is up. All of those are pointing to some current benefits in the market.
But, the fundamentals themselves haven’t changed. Foreclosures remain a major issue for our economy. And unemployment remains a major challenge. Until those two areas of the economy fully recovery, we may see continued economic volatility.

What I can say is I think the worst of the housing market’s problems are probably behind us. But the road ahead isn’t completely clear. One major factor that stands in our way is the impending expiration of the first time home buyer tax credit. This credit has helped to drive much of our recovery. But right now the debate on Capitol Hill continues and everyone is waiting to learn whether the credit will be extended, expanded or will it simply expire. Many on the opposing side believe it is too costly to finance. But NAR had this to say: “Each home sale pumps an additional $63,000 into the economy through related goods and services, so the benefits of extending and expanding the tax credit far outweigh the costs.”

If the opposing side gets their way and the credit simply expires, NAR had this to say: “All we can say for certain is sales will decline when the tax credit expires because we are not yet on a self-sustaining recovery path. It also raises a risk of a double-dip recession. Extending and expanding the tax credit is the best tool in our arsenal to encourage financially qualified buyers to stimulate the economy and help reduce the budget deficit.”

So there you have it. We’re in a state of flux as we await the results of the credit. As that debate continues, buyers seem to be leveraging today’s market advantages which is creating a welcome relief for our local market. Let’s just hope the leveraging opportunities continue.

Now, let’s take a look at this week in real estate:

Auburn—Most short sales are showing as contingen
Elk Grove— For September 2009 in the 95624 Zip Code, there were a total of 77 closed sales approximately 43% REO, 27% Short Sales and 30%(28% August) conventional sales. Average sales price was $250k ($230k August) for conventional sales vs. $232 for REO/Short. For 95758 there were 77 sales with approximately 47% REO, 24% Short and 29%( 25% August) conventional sales. While conventional sales average price was $240k, REO’s were $218k and Short Sales were $194k. For 95757, there were 69 sales with 55% being REO, 20% Short Sale and 25% (no change from August) conventional sales. Again, average sales price for conventional sales was considerably higher than REO and Short Sales with averages of $280k, $267k and $247k. The 3 zips combined: 240 closed sales with approximately 47% REO, 24% Short Sales and 29% conventional sales (26% August). From all this, it appears that we are starting to see more conventional sales with average sales prices higher on these sales in 95624 and lower in 95757 and 95758 month over month. No clear trend in sight.
Rocklin Lincoln—Most short sales are showing as contingent but asset managers are calling to see if they can help for a change. We have four more that appear to be closing this month.
Sacramento Fair Oaks— REO Activity: The REO activity is still slow in the office. Our REO agents are getting a few new assignments and listings. They are still waiting for the wave to come in. Short Sales: They are steady but still very hard to close. Representing buyers is the most difficult to close do to lack of control of the transaction. Listing Agents are doing fairly well in their closing rate though. Activity over $750,000 slow but it is coming around and we are seeing more sellers requesting market analysis of their properties. This is a good sign for the up and coming year. Additional comments: Agents are still thinking very positive about the market. It is about prospecting and getting out there in the public and asking for the order. If you do not ask them there will be another agent that will.
Sacramento Sierra Oaks— The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe Truckee— Active Listings: The listing inventory for the Tahoe-Truckee market went down slightly again to its lowest level since May of this year to 2,097 active listings - 1,443 residential properties and 654 lots and land listed for sale. The reduction in listings is part due to sales and in part to expired listings and homeowners taking their homes off the market for the winter. Active Listings - REOs and Short Sales: Of the active listings, there are 166 properties listed as short sales, (7.9%) and 61 properties listed as REO sales, (2.9%). While less than 11% of the active listings are short sales and REO’s, roughly 25% of the properties selling are short sales and REO’s. Last Week’s Sales: For the week of October 5th to October 11th there were 22 properties that sold which was a large drop off from the week prior 33 sales. Of the properties sold last week, three (3) of those sold at a price above $750,000. Pending Sales: Pending sales decreased once again to 210 properties from the previous week. Market Activity Summary: Fall has definitely hit the Tahoe-Truckee area with cooler weather and a much quieter town with respect to visitor activity. While visitor activity is slow, Buyer activity remains encouraging for competitively priced properties. Coldwell Banker currently has over 50 homes in escrow scheduled to close in the next 30-60 days.

This week I’ll conclude with a few story highlights:

USAA Praises Biggert Bill To Extend First-Time Homebuyers Tax Credit; Reuters
Hopes Run High For Tax-Credit Expansion; MarketWatch
Washington Report: $8,000 Home Buyer Tax Credit; Realty Times

Also, CAR released its 2010 forecast this week. Please read it here: http://www.car.org/newsstand/newsreleases/2010forecast/.

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Tax Credit: Expand? Extend? Expire?

2009-10-08T17:15:00.000-07:00

The question everyone is asking is, will the government expand, extend or simply let the $8,000 first time home buyer tax credit expire. With just over 50 days left until it is expires, the debate is on and everyone is waiting on pins and needles to hear the result.

Whichever side you take on the debate, what you can’t deny is the fact that nothing has done more in the past year to jumpstart our housing market more than the $8,000 first time home buyer credit. Will all of that come tumbling down if it isn’t extended or expanded on? It’s hard to say but I believe that if it isn’t expanded we will see a definite drop in first time home buyers in 2010 and probably a much larger emergence of investors in the entry level arena. While on the surface that may not seem troubling, it actually is. The fact is that investors purchase homes solely for net profit while first time home buyers purchase homes for lifestyle. When we have a balance between the two it keeps home prices relatively stable. If one of the two disappears, we’ll likely start to see drops in home prices which isn’t good for a market that has already taken its fair share of hits.

While Congress continues to debate the issue what we as Realtors are calling for is support of an expansion of the tax credit from first-time buyers to all homebuyers, increasing the maximum amount of the tax credit from $8,000 to $15,000, eliminating the existing income caps for eligibility purposes and extending this homebuyer tax credit for one year from the date of enactment.

We believe that stimulating demand for housing—particularly in the repeat buyer market—is the most effective way for Congress to help lead the U.S. economy into a recovery and back on the path to growth. Timing is critical and we hope that Congress will hear our voices.
While the clock ticks and we await the results of the debate on Capitol Hill, let’s take a look at this week in real estate:

· El Dorado Hills— The inventory is falling and is down close to 10% over the last few weeks. Over 1/3 of the listings are short sales and over half of those have offers and are waiting for bank approval so the true actives are very low. Closings are slower with lots of last minute loan hurdles to jump over.
· Elk Grove— How do you come up with different ways to say the same thing each week…REOs and short sales continue to dominate. We did have a “real” listing that didn’t appear to be priced overly aggressively, receive multiple offers. The only explanation is that there is little inventory and a tax credit that is expiring in November. Agents that are looking for good listing leads are finding them.
· Folsom— Good market but no easy escrows! The Folsom agents were busy with buyers this week with 75% of our total sales on the buying side and only 25% of the time representing the seller. We need more good inventory to sell just like every other office in town!
· Placerville— Inventory is the Placerville area has dropped over the past few weeks and well priced homes are receiving multiple offers. About 25% of the listings are short sales and very few REO’s. We’re seeing incredible bargains in all of El Dorado County so buyers who have been waiting for that great deal better hurry up!
· Roseville Granite Bay— Banks slow on Short Sale approvals
· Sacramento Fair Oaks-We are seeing an increase in sales and activities recently. Agents are working extremely hard on getting listings with the real sellers and the short sale Agents in the office are doing very well. Short sales are closing but taking longer than expected. We are seeing light at the end of the tunner. We just keep pushing forward. Yes, it is a great opportunity to be in real estate, especially with Coldwell Banker.
· Sacramento Metro— Market has really slowed down in our core areas of Sacramento.
Sacramento Sierra Oaks—The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
· Tahoe/Truckee— Active Inventory Summary: Active Listings: The listing inventory for the Tahoe-Truckee market went down to its lowest level since May of this year to 2,121 active listings - 1,456 residential properties and 665 lots and land listed for sale. The reduction in listings is part due to sales and in part to expired listings and homeowners taking their homes off the market for the winter. Active Listings - REOs and Short Sales: Of the active listings, there are 158 properties listed as short sales, (7.4%) and 60 properties listed as REO sales, (2.8%). While less than 10% of the active listings are short sales and REO’s, roughly 25% of the properties selling are short sales and REO’s. Sales Summary: Last Week’s Sales: For the week of September 28th to October 5th, there were 33 properties that sold which was the highest singles week for closed properties in all of 2009. Of the properties sold last week, four (4) of those sold at a price above $750,000. Coldwell Banker was involved in 11 of the 33 closed properties either on the listing or selling side of the transaction. Pending Sales: Pending sales decreased once again to 217 properties from the previous week. Market Activity Summary: Fall has definitely hit the Tahoe-Truckee area with cool weather this past week. The town was quiet and while open house activity was slow, sales for the week were at a yearly high…go figure. Buyers for competitively priced properties continue to be strong. Coldwell Banker currently has over 50 homes in escrow scheduled to close in the next 30-60 days.
· Vacaville— With rates low and affordability back we have a tremendous amount of buyers who recognize the opportunity in this market. But, we continue to have an inventory shortage, our median sold price continues to improve indicating that we are no longer in a declining market. In September we only had 1868 homes to sell compared to September of last year when we had over 4400. Our median sales price is hovering right around 200K and right now the bulk of our inventory is short sales.

Here are a few informative links regarding the $8,000 tax credit that you may find helpful:

Update: Industry Makes Case For Home Buyer Tax-Credit Extension; Wall Street Journal
Builders Urge Congress To Act On Home Buyer Tax Credit, Appraisal And Lending Issues; National Association of Home Builders
Homebuyer Tax Credit Best Tool For Sustaining Housing Recovery, Says NAR; NAR
Make The Home Buyer Tax Credit More Easily Available At Closing; RISMedia
1.4 Million Families Have Taken Advantage Of First-Time Home Buyer Tax Credit, More Claims Expected; RISMedia

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

S&P Reports On The State of the Housing Market

2009-10-01T13:30:00.000-07:00

One of the founders of what has really become the industry’s (and media’s) bible for real estate statistics and forecasts, S&P Case Shiller, recently participated in a Q&A about the state of the housing market. Robert Shiller, a Yale University economist, discussed the housing market and the implications of lower interest rates. I found it quite conservative yet insightful and in my opinion, on target with what is going on in today’s market.

That is why for this edition of Weekly Market Watch, I am going to provide you with an excerpt from his interview:

Is the slump in U.S. home prices bottoming out?

Shiller: The situation has definitely changed. With our numbers — the S&P/Case Shiller home price index — going up sharply. It looks like a major turnaround. We’ve been watching that for three months now, and we have some concern that it could be an aberration and temporary. But, at this point, it seems to be evident in just about every city in the U.S. That suggests it’s real. But it probably isn’t the beginning of a major boom, just because the economy is in such bad shape. There’s also a chance that it will reverse. It’s still only three months old, so it’s very hard to be sure at this point. The most likely scenario is that it won’t continue at this high rate of increase, but that it will neither go down a lot, nor up a lot.

So the index will move sideways for a while?

Shiller: Yes, for a while, meaning five years.

What are the main factors driving U.S. house prices? What could push them up, or cause another slump?

Shiller: The main factor is the world economic crisis and the efforts of governments around the world to stimulate the economy. Parts of those efforts have been directed at the housing market. In the U.S., there is an 8,000 dollar first-time home buyer’s tax credit which expires at the end of November. That’s a reason for concern, as it comes to an end. Also, the Federal Reserve has a plan to buy $1.25 trillion worth of mortgage-backed securities to support the housing market. They are most of the way through the program and anticipate phasing it out at some time in 2010 - that’s another thing that will go away. We’ve yet to see how the housing market will continue. Part of the problem is that people are buying now rather than later. When later comes, there could be a downturn in the market.

Is there an oversupply of houses in the U.S.?

Shiller: That’s been a problem. The inventory of unsold houses has been high, but has come down a bit. On top of that, there will be more foreclosures, more homes are going to be dumped on the market as people default. Now, that may show down as home prices will start going up again. But I suspect that this isn’t going to happen. Also, banks have more REO, or real estate owned, that they’re holding on to for the time being. But eventually those REOs are going to be dumped on the market. So that’s why it doesn’t look particularly encouraging from a supply consideration.

Turning to interest rates, which are at exceptionally low levels: Is there a risk that this eventually will cause irrational exuberance?

Shiller: There is always a risk of that. Those things are hard to predict. However it seems like the present time is least conducive to bubbles of any time. We’re in what some people call “pretend-and-extend” economy, which means that banks that have commercial loans are often extending those loans and pretending that the property is worth something. That’s because they don’t face reality. This kind of economy isn’t really suited to a beginning of a real bubble. Now, everything could change… It’s surprising how strong the residential, single-family home market looks right now. It makes me think that it’s hard to predict animal spirits.

How long can central banks afford to keep expansive policies in place?

Shiller: In principle we can keep this in place for a long time. That’s what Japan did… But confidence is definitely coming back. The depression scare is over at the moment. So it would be plausible that central banks could be raising interest rates — both in the U.S. and Europe — [as early as next year]. But I just have a worry that this isn’t going to happen and that it’s not going to be so easy to extricate [themselves from the low-rate environment].

Will the sharp increase in global debt levels drive up inflation over the medium to long-term?

Shiller: My best guess is that we won’t have inflation, that central banks will pull it back as inflation starts to begin. But I think that there’s a chance of it; people have to be defensive in their investments. It always amazes me that people are so trusting and that they want nominal debt as much as they do… So a good long-term strategy is to invest a good part of one’s portfolio in inflation-indexed bonds, even though it doesn’t particularly look like the time to worry about inflation right now.

I tend to agree with Shiller on many of his statements, specifically that we are probably in the midst of a turnaround. Having said that, it is important to point out that this isn’t going to be a sharp “V” recovery with a sudden jump in prices or units. In all probability what we will see is a long “L” shaped broad recovery in which prices are relatively stagnant for some time before eventually inching up.

Now, let’s take a look at this week in real estate:

· Auburn—Agents are trying to stay upbeat but they are pretty beat up by the buyers regarding the lack of inventory. We did get one short sale approved this week even after the mortgage insurance company said no. We will have another short sale approved by the end of this week. It is great seeing some of the short sales come to closing.
· El Dorado Hills—The market remains the same. The pending listings are about the same as the new listings coming on the market so the inventory is still at about 361 active listings. Short sale listings continue to rise but the REO listings are still under 10% of the inventory. More NODs are being filed so Agents need to be aware when working with investors.
· Placerville—The entire El Dorado County market is pretty much the same. We’re seeing a few more REO’s come on the market but they are almost always priced competitively and sell with multiple offers. We’re seeing a lot of FHA first time homebuyers. The short sale listings make up almost 40% of the Placerville area inventory.
· Rocklin-Lincoln—We had a great speaker that stressed getting back to the basics and then CoreFact showed us some of the tools that they have that might help the Agents become successful. We have several Agents participating in the Move up buyer program.
· Roseville/Granite Bay—Look for opportunities. The push is on for saleable listings with REO lull in current mode.
· Sacramento Metro—Good priced properties in East Sacramento, Land Park and South Land Park continue to sell very quickly.
· Sacramento-Sierra Oaks—The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
· Tahoe/Truckee—Active Inventory Summary: Active Listings: The listing inventory for the Tahoe-Truckee market went down slightly for the week to 2,223 active listings - 1,536 residential properties and 687 Lots and land listed for sale. The reduction in listings is part due to sales and in part to expired listings and homeowners taking their homes off the market for the winter. Active Listings - REOs and Short Sales: Of the active listings, there are 160 properties listed as short sales, (7.2%) and 57 properties listed as REO sales, (2.6%). While less than 10% of the active listings are short sales and REO’s, roughly 24% of the properties selling are short sales and REOs. Months of Inventory: Based on the current inventory and sales for the previous 30-day period, the market has roughly 15-months of inventory available. There is definitely a large inventory of homes for buyers to choose from at great prices. Sales Summary: Last Week’s Sales: For the week of September 21st through 27th there were 30 properties which closed in the market which is a slight increase from the previous week. Of the properties sold last week, five (5) of those sold at a price above $750,000. Pending Sales: Pending sales decreased to 226 properties from the previous week. Market Activity Summary: With the end of the summer season and beginning of fall, visitor traffic has slowed and open house activity is fair. However, sales this past week were consistent with weekly sales averages since early August. Buyers for competitively priced properties continue to be strong. Coldwell Banker currently has over 54 homes in escrow scheduled to close in the next 30-60 days.

Without a doubt, locally what continues to push our market in the right direction is the $8,000 first time home buyer tax credit. Currently in Washington D.C., real estate industry representatives and government officials are lobbying for either a $15,000 all home buyer tax credit or at minimum, an extension of the $8,000 first time home buyer tax credit but the result of that debate is still in the air. If the tax credit does disappear we are likely going to see an emergence of investors in the first time home buyer arena which may cause problems with housing prices and a continued erosion of the first time home buyer market. Please contact your local representative to call upon his/her support of this important initiative.

Next week I will release the October edition of Reality Check. This month’s edition will feature a Q&A from me on the local housing market and what we may expect for 2010.

Until then,
Make it a great week,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

“The patient is out of intensive care, but still has a very long road ahead to a clean bill of health.”

2009-09-17T16:28:00.000-07:00

Those were the words last week from Fannie Mae Chief Executive Officer Michael Williams. The CEO went on to say, “Anyone looking objectively at the economy and the housing market sees hope.”

Another good solid indicator of what I’ve been saying in my weekly updates. The U.S. housing market still has a long road ahead but we are making some definite moves towards a housing recovery. So what’s the challenge? Well for starters, rising unemployment numbers aren’t helping. The United States Department of Labor reported in its September 4 Economic Situation Summary that the number of unemployed persons increased by 466,000 to 14.9 million and the unemployment rate rose by 0.3 percentage point to 9.7%. Just to give you an idea, since the recession began in December 2007, the number of unemployed persons has risen by 7.4 million, and the unemployment rate has grown by 4.8 percentage points.

We also need to couple that with the challenges in the mortgage industry. Bloomberg reported, “The mortgage market is still dependent on government-affiliated programs, with private banks providing just 10 percent of loan liquidity, down from about 60 percent in 2006. Fannie Mae and Freddie Mac are responsible for about 70 percent of all new mortgages, while the Federal Housing Administration accounts for about 20 percent.”

Before we can be truly reformed, we need to get into a position where there is more of a balance between private bank loans and Fannie Mae and Freddie Mac loans. In all actuality, we probably won’t see that for some time.

Having said that, U.S. mortgage applications surged last week with demanding rising to its highest level since late-May as consumers sought to take advantage of the lowest interest rates in months, according to Reuters.

The Reuters article reported, “While home refinancing loans dominated demand, the appetite for applications to buy a home, a tentative early indicator of sales, hit its highest level since early January. The overall trend bodes well for the hard-hit U.S. housing market, which has been showing signs of stabilization.”

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications which includes both purchase and refinance loans, for the week ended September 4 increased 17.0 percent to 648.3, the highest level since the week ended May 29.

These are all very positive indicators that showcase that we are on the right track…it’ll probably be a slow track…but we’re on the right one.

Now let’s take a look at this week in real estate:

Auburn—The energy of the Agents is amazingly positive even with the challenges of this market. A couple of the Agents attended the Buffini workshop and said that Brian Buffini used the analogy of the Rocky movie with the scene where Rocky’s face is bloody and swollen and said that is where we are in the market today and having come through this we just need to hang in there and we will survive.
Elk Grove—For the month of August there were a total of 254 closed sales. Of these, 50.4% were REO, 23.2% were short sales and the remaining 26.4% were traditional sales. It goes without saying that with 75% of the business in the hands of lenders either releasing inventory or approving a short sale, Agents need to work extremely hard for every deal.
Folsom—The market is crazy but very frustrating to both the buyers and the Agents!! Agents are getting a lot of practice writing offers, but difficult to get into escrow! Floor time is good and open houses are still a good place to meet buyers. Sellers in the higher priced properties are getting some lookers, but still quite slow.
Rocklin-Lincoln—Still not enough inventory but we have two new Agents that have been in the business for a month or less and each have a pending sale. We have qualified buyers but not enough in the under $300,000 inventory.
Roseville-Granite Bay--We're seeing many short sale offers though overall, sales activity is decreasing. Activity on listings above $750,000 is very slow.
Sacramento Sierra Oaks—The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe-Truckee— Inventory Summary: nnActive Listings: The listing inventory for the Tahoe-Truckee market went down 2% for the week to 2,269 active listings - 1,587 residential properties and 682 lots and land listed for sale. REOs and Short Sales Active Listings: Of the active listings, there are 159 properties listed as short sales, (7.0%) and 63 properties listed as REO sales, (2.8%). Overall, the Tahoe-Truckee market has less than 10% of its active inventory listed as a short sale or REO. Months of Inventory: Based on the current inventory and sales for the previous 30-day period, the market has roughly 17-months of inventory available. Lots to choose from if you are a buyer! Sales Summary: Last Week’s Sales: For the week of September 7th through 13th there were 22 properties which closed in the market which is half of what closed the previous week. Of the properties sold last week, two (2) of those sold at a price above $750,000. Of last week’s sales, Coldwell Banker was involved in 13 of the transactions, (6 listings sold and 7 buyer sales). Pending Sales: Pending sales increased to 225 properties from the previous week. This is yet another indication of buyer interest in Tahoe-Truckee real estate and the increased affordability of our homes. Market Activity Summary: Open house activity has slowed along with the visitor activity in the area. However, the level of buyer interest and offers on homes has remained brisk given the motivation of buyers to secure great deals in the market and motivated sellers who want to sell before the winter. Coldwell Banker currently has over 59 homes in escrow scheduled to close in the next 30-60 days
Vacaville-Fairfield— Our current active inventory for Vacaville is 370 active listings. Of those 171 are “Contingent Show” (a sub category of our MLS system) and 199 are available for an offer. Since 9/1/09 219 are Pending and 42 are Sold. All of our listings that are priced correctly up to the $375K range are receiving multiple offers. Our Agents are out pounding the pavement looking for inventory. They are busy educating the public that now is a great time to sell and buy.

I did want to let you all know that I will be taking next week off of Weekly Market Watch but I will return the following week with another robust edition.

Until then,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

“Yes, the housing market has rarely looked better.”

2009-09-10T17:01:00.000-07:00

That was the headline in a September 2 Wall Street Journal article. Click here to access it: http://online.wsj.com/article/SB10001424052970204047504574386802310702622.html. This was a really interesting piece which looked at numbers from Standard & Poor’s and NAR. Following is an excerpt from the article:

“Last week, Standard & Poor's reported that its S&P/Case-Shiller U.S. National Home Price index of real-estate values increased this past quarter over the first quarter of 2009, the first quarter-on-quarter increase in three years. Its index of 20 major cities also rose for the three months ended June 30 over the three months ended May 31, with only hard-hit Detroit and Las Vegas experiencing declines. The week before that, the National Association of Realtors reported that sales volume of existing homes was up 7.2% in July from June.

In short, the data suggest that real-estate prices hit a bottom some time during the second quarter, and have now begun to rise. There's no way to be certain that this marks the end of the long, painful correction that followed the real-estate bubble, but clearly prices are no longer in free-fall. That means if you've been sitting on the fence, it's time to act.

Ordinarily I'd never try to time the real-estate market, but I can understand why buyers have been cautious. Few want to buy in down markets, just as stock buyers avoid bear markets. And for most people, of course, buying a house is a much bigger decision than buying a stock. But with real-estate prices nationally now down about 30% from their 2006 peak and showing signs of turning up, the prices aren't likely to go much lower. Every real-estate market is local, and so there may be a few exceptions. Overall, though, I can't imagine a better time to buy than now.”
This of course is what I’ve been saying for some time and it is nice to see it in black and white in a reputable publication like The Wall Street Journal. The fact is, while we may have a long road ahead, we probably have hit bottom and if you were considering buying you probably should consider acting now before it is too late.

And with that said, let’s take a look at this week in real estate:

Auburn—The Auburn area was impacted greatly over the past week with the 49er fire. We have spent many hours receiving and delivering donations to the various drop off locations. The Agents are educating their clients on the importance of making sure the contractors they hire are properly licensed and have done a background check for any issues they might have had in the past or complaints from past clients.
Dixon/Davis— Not much change from prior weeks. Need inventory, we have lots of buyers and no houses to sell. We have 20 active homes in Dixon! New listings sell in one day, multiple offers.
El Dorado Hills— Very stable inventory at about 355 active listing. One third of these are short sales and only 20 are REOs. Our sales the last week range from $114,000 to $1,200,000 and closings range from $40,00 to $1,000,000. All over the place.
Elk Grove—Prices have bottomed…it appears. Inventory continues to be extremely low.
Folsom— The Folsom market is really heating up again! If a property is priced right, expect multiple offers. Attitude in the office is very good and for the Agents that are working this is a great time to be in real estate!
Placerville— We’re having a busy month so far with many walk ins and floor calls. Our inventory is still stable, 177 active listings with 38 short sales and 17 REOs. Business has been brisk.
Rocklin/Lincoln—Agents held open houses on Sat., Sun., and Monday and had a good turnout at most. The most open house had 12 people on one day but the Agents are now working with several leads from these and one person was looking to list their home and the Agent will meet them tonight. The general consensus is that there are qualified buyers, many with cash, but not enough inventory.
Roseville/Granite Bay—Lots of short sale inventory.
Sacramento Sierra Oaks—The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe/Truckee— Active Listings: The listing inventory for the Tahoe-Truckee market went up slightly for the week to 2,315 active listings - 1,625 residential properties and 690 lots and land listed for sale. REOs and Short Sales Active Listings: Of the active listings, there are 152 properties listed as short sales, (6.6%) and 63 properties listed as REO sales, (2.7%). Overall, the Tahoe-Truckee market has less than 10% of its active inventory listed as a short sale or REO. Months of Inventory: Based on the current inventory and sales for the previous 30-day period, the market has roughly 18-months of inventory available. Lot’s to choose from if you are a buyer! Last Week’s Sales: For the week of August 31st to September 6th there were 40 properties which closed in the market which is double the closes in any one week this year. Of the properties sold last week, eleven (11) of those sold at a price above $750,000. It was a great week for sales. Pending Sales: Pending sales remained constant at 215 properties from the previous week. This is yet another indication of buyer interest in Tahoe-Truckee real estate and the increased affordability of our homes. Market Activity Summary: Labor Day weekend was a busy weekend in town with visitors to the area enjoying the last long weekend of the summer in Tahoe. Coldwell Banker conducted 18 open houses with decent activity at the homes. The one constant remark we are hearing from our Sales Associates is that buyer activity is as brisk as it has been in the last 18-24 months and that many are thinking this is the time to buy. Coldwell Banker currently has over 55 homes in escrow scheduled to close in the next 30-60 days.

This week I’ll leave you all with the reminder that the $8,000 federal tax credit for first-time homebuyers is scheduled to expire on December 1. However, in order to qualify, the transaction must be closed on or before November 30, essentially leaving first-time buyers with less than three months to complete the process.

While the urgency of trying to find and close on a home before the deadline may seem stressful, it doesn't have to be. Just contact your Realtor today and they can walk you through the process or visit us online at CaliforniaMoves.com.

Until next week,
Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Good News On Wall Street Doesn’t (Necessarily) Mean Higher Housing Prices on Main Street

2009-08-20T21:41:00.000-07:00

I had an interesting chat with one of our Agents recently. She mentioned that many of our sellers in the upper-tier price point are seeing the current strength of the Dow as a sign that their home will probably fetch more in the early part of next year. Academically speaking, there is a belief that there is a direct correlation between the housing market and the stock market.

But from an analytical standpoint, although the stock market and the housing market correlate well, there is a variable time lag. The time lag between housing underperformance and stock market performance can vary widely. The average is 18 months.

What we’re seeing, in some instances, is that some of the upper-tier clients are saying no to potential deals as they think if they wait another four to six months (thanks to the stock market’s recent gains) they may get more for their home. And while I understand the reasoning, I would caution sellers on this strategy. First, what we know is that in a “normal” market (of which this market is anything but), the average lag time between the two is 18 months (not four to six months). It’s also important to point out that we probably aren’t out of the woods as it relates to the volatility in the stock market. Many analysts are suggesting that our recovery will be “W” shaped rather than “V” so we may be looking at more changes ahead.

So while I understand the logic, I would caution sellers on this strategy and would ask them to focus less on the stock market and more on the level of supply and demand in their market and in their neighborhoods. In most markets, the upper-tier price point remains relatively soft so sellers should consider most deals that are presented to them. That’s not to say buyers should be throwing out unrealistic offers. The real story here is that across the board we’re starting to see increases in interest and buyer activity so sellers may want to consider taking advantage of that interest…before it’s too late.

For those who are focused on the stock market, my best advice to you is to look at it more as an indicator for the economy as a whole. With the DOW closing Thursday at just over 9,300, it may not be making housing prices go up, but it may mean that the recession is subsiding which is good news for us all.

Now let’s take a look at this week in real estate:

Auburn— Quiet this week but Agents are all busy writing offers but it is just hard to get accepted. Buyers are still not believing that the offer on an REO needs to be 10% or more over list price in most cases.
Dixon/Davis—Not much change from prior weeks. We need inventory. We have lots of buyers and no houses to sell. We have 20 active homes in Dixon! New listings sell in one day with multiple offers.
Folsom—Buyers are still writing offers on multiple properties.
North Lake Tahoe/Truckee— Active Listings: The listing inventory for the Tahoe-Truckee market went down slightly last week to 2,367 active listings in the market - 1,677 residential properties and 690 lots and land listed for sale. Active REOs and Short Sales: Of the active listings, there are 147 properties listed as short sales, (6.2%) and 64 properties listed as REO sales, (2.7%). Overall, the Tahoe-Truckee market has less than 9% of its active inventory listed as a short sale or REO. Active Inventory: Based on the current inventory and sales for the previous 30-day period, the market has roughly 23-months of inventory available. Sales Summary: Last Week’s Sales: For the week of August 10th to August 16th there were 22 properties which closed in the market with four of those sold at a price above $750,000. This past week’s closings were up slightly from the previous week. Pending Sales: Pending sales in the market increased to 209 properties which is slightly higher from the previous week. Market Activity Summary: Open house activity continues to be fair to good depending on the location of the open house. We are definitely seeing more tourists in town given the season which certainly creates more real estate interest and activity. Sales Associates are continuing to see more buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 51 homes in escrow scheduled to close in the next 30-60 days. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Now is the time to buy!
Rocklin/Lincoln— Quiet this week but Agents are all busy writing offers, just hard to get accepted. Buyers are still not believing that the offer on an REO needs to be 10% or more over list price in most cases. We are starting to see some land sales. The prices have fallen and as an example a lot in Morgan Creek that originally sold for about $300K sold for under $100K and included paid fees and plans.
Roseville/Granite Bay— Agents are aggressively working on short sale listings!
Sacramento Metro— Market seems to have slowed down during the summer months and we continue to see no activity in the move up buyer.
Sacramento Sierra Oaks—The inventory is very low. A LOT of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Vacaville/Fairfield—First time home buyers, move up buyers and investors are in the marketplace. For those who are fortunate enough to secure a property, the buyers are typically offering more than the asking price. Cash continues to be king, followed by FHA and then VA. With the offers higher than the asking price, appraisals are an issue.

This week I’ll leave you with a few good articles of note:

Mortgage Applications Increase In Latest MBA Weekly Survey; Mortgage Bankers Association
Optimism Grips Homeowners: 81% Think Home’s Value Will Increase Or Stay Same In Next 6 Months; RISMedia
Are New Home Prices, Starts And Sales Rates Nearing Bottom?; RISMedia

Until next week,
Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

They’re Saying The Worst is Behind Us…But Is It Too Soon to Celebrate?

2009-08-13T20:12:00.000-07:00

I was driving home from an office meeting this week and was listening to NPR. During the drive, an interesting update came on which mentioned that the Federal Reserve was reporting that the recession is ending and that it would take a step back toward normal policy.

When I got home I decided to Google the news and I found this article on the NYTimes.com website: http://www.nytimes.com/2009/08/13/business/economy/13fed.html?_r=2&partner=rss&emc=rss&src=igw. The article reports, “Almost exactly two years after it embarked on what was the biggest financial rescue in American history, the Federal Reserve said on Wednesday that the recession is ending and that it would take a step back toward normal policy.”

The article goes on to note “Though the central bank stopped well short of declaring victory, policy makers issue their most upbeat assessment in more than a year by saying that the downturn appears to have hit bottom and that consumer spending, financial markets and inventory building by corporations all continued to stabilize.”

Well never one to solely rely on just one institution’s opinion, nor that of just one article, I decided to put my feelers out. I reached out to mortgage broker colleague to get his take and to learn more about what our mortgage colleagues are seeing in relation to the current state of the economy. He had some comments that I tend to agree with noting that “Many are concerned we’re going to have a ‘W’ shaped recovery versus a ‘V’ shaped recovery. We don’t want to proclaim the recession is over, only to see the economy struggle for another year. It’s going to be a long, slow recovery. One month we may have positive economic news and the next, poor economic news.”

Having said that, here is what we tend to be seeing about the market:

It does appear that the worst of the recession may be behind us.
In all likelihood, the Fed is going to keep rates relatively low well into next year by continuing to purchase mortgage backed securities and keep the Federal Funds Rate close to zero. It is currently at .25%.
In terms of conforming loan limits, as of right now, the higher conforming loan limits will end at the end of this year. There is some legislation that is pending to renew the higher loan amount through until November 2010 but as of right now, that is pending. The same holds true for the first-time home buyer tax credit.

Knowing this, what lies ahead? Well I would say it’s positive to know that the worst may be behind us, but in all likelihood there are still challenges ahead. There is still much recovery that needs to take place, so neither sellers nor buyers should be getting too excited with the news. Sellers still need to get a bit more realistic about price and buyers need to recognize a bargain when they see it.

And with that news in tow, let’s take a look at this week in real estate:

Auburn—Quiet this week but Agents are all busy writing offers, just hard to get accepted.
Dixon/Davis—No information reported.
El Dorado Hills—The buyers are waiting in the wings. We have 20 pendings in EDH so far this month for the entire city. Prices are attractive. We had 72 solds last month and lots of activity, just very few new sales. Homes must be priced very aggressive to be considered. Inventory remains at the same level.
Elk Grove—For the first time in over a quarter the average sales price increased in our zip codes. Typical low inventory challenges prevail, buyers are fighting over property and it doesn’t appear to be getting better anytime soon.
Folsom—Open house activity good. Closings were down last week. End of summer, always slower.
Placerville—Inventory has dropped some and activity has slightly slowed. Prices seem to be stabilizing.
Rocklin/Lincoln—Seems to be a little more quiet than usual with many finishing up vacations and others getting ready to go back to school.
Roseville/Granite Bay—No information reported.
Sacramento Fair Oaks—Yes overall the market has been slower. The buyers are still out there looking but the inventory is extremely low. We are seeing more multiple offers and homes going over asking price. We are of course seeing issues with homes appraising. In my office the agents are confident that the market is going to get better. They also keep a positive outlook and share that with their clients and prospects.
Sacramento Metro—Market seems to have slowed down during the summer months and we continue to see no activity in the move up buyer.
Sacramento Sierra Oaks—The inventory is very low. A lot of “frustration” from the agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe/Truckee—No information reported.
Vacaville/Fairfield—No information reported.

In terms of marketing activity, in general, depending on the price range, most homes are on the market longer with discerning buyers waiting for the optimal home at the optimal price. A well-priced, well-presented home can still fetch multiple offers (especially if it is in the entry-level market), but it’s got to look appealing to the savvy buyers who are doing their homework. There is no sense in overpricing a listing – a buyer won’t even give a home the time of day if they sense the seller is being unrealistic.

Yet at the same time, there seems to be no better time to snatch up bargains in Northern California at all price points. We’re seeing five to 10 percent reductions in properties that are sitting on the market and in many cases the final offers are coming in below those reductions. That’s not to say buyers should throw out ridiculous numbers. Some sellers who don’t have to sell are holding firm, but time is running out for others. So, while it may take longer to get the buyer and seller to agree to terms, deals are happening and with open minds on both sides, we might start to see more positive movement for all.

Until next week,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

One Good Week of News Leads to Another

2009-08-06T17:51:00.000-07:00

Following last week’s breaking housing news which revealed that based on the Standard & Poor’s/Case-Schiller 20-city index, home prices in May posted their first monthly increase since the summer of 2006.

The news followed reports showing sales of newly built and existing homes rose in June for the third consecutive month. New home construction, though still weak, is the best it has been since the fall.

Well this week the good news continued. The Mortgage Bankers Association (MBA) released its Weekly Mortgage Applications Survey for the week ending July 31, 2009 showcasing an increase in mortgage loan application volume of 4.4 percent from the week earlier. On an adjusted basis, the Index increased 4.1 percent compared with the previous week and 18 percent compared with the same week one year earlier.

The Refinance Index increased 7.2 percent from the previous week. The Index has climbed about 35 percent above its recent low at the end of June. The seasonally adjusted Purchase Index increased 0.9 percent from one week earlier.

Also interesting to note is this week’s release of the National Association of Realtors’ Pending Home Sales Index in which it revealed an increase of 3.6% during the month. That was 6.7% higher than June 2008. It was the fifth straight month of increases, the first time that has happened since July 2003. The jump was much higher than expected with a consensus of industry experts put together by Briefing.com forecasting an increase of just 0.7%.

NAR’s Chief Economist Lawrence Yun had this to say, “Historically low mortgage interest rates, affordable home prices and large selection are encouraging buyers who’ve been on the sidelines.” It seems all of these incentives, much like the Cash for Clunkers program in the auto industry, is finally pushing people off of the fence.

Now, let’s take a look at this week in real estate:

Auburn— Lender requirements are very strict and several contracts have fallen out with some of the new regulations.
Dixon/Davis—No information reported.
El Dorado Hills— Inventory is stable but buyer activity is slow. School starts in a week or so. Hopefully it will pick up then.
Elk Grove/Laguna— Very low inventory is persistent. Buyers are everywhere, but it is difficult for first timers and buyers with lower down payments. Cash reigns as king.
Folsom— Open Houses seem to be slower. Floor has been steady and the quality of the calls has been very good. Activity in the higher priced listings is starting to wake up with one sale this week at $750,000 and another one at $965,000. Quite a few Agents are working with buyers and the attitude seems to be good!
Placerville—Inventory now has about 25% short sales but very few REOs. We’ve had several walk-ins the last week but it’s still difficult to get them to make a move.
Rocklin/Lincoln—Agents were pleased to hear that the “noise” we are making in regards to HVCC is being heard and one of the changes so far, is that they will be using appraisers local to that area. This also was highlighted in another real estate publication this week to illustrate the need for us to be more vocal if we want change.
Roseville Granite Bay—Both listing and sales inventory is steady in our area. We saw six multiple offers this week and double that in ratified offers. An average number of opens: five with moderate traffic. Bank of America REOs are coming in two weeks!
Sacramento Fair Oaks—Yes overall the market has been slower. The buyers are still out there looking but the inventory is extremely low. We are seeing more multiple offers and homes going over asking price. We are of course seeing issues with homes appraising. In my office the Agents are confident that the market is going to get better. They also keep a positive outlook and share that with their clients and prospects.
Sacramento Metro—Market seems to have slowed down during the summer months and we continue to see almost no activity in the move up buyer.
Sacramento Sierra Oaks—The inventory is very low. A LOT of “frustration” from the agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe/Truckee— Active Listings: The listing inventory for the Tahoe-Truckee market went down last week for the first time in four months to 2,364 active listings in the market - 1,680 residential properties and 684 lots/land listed for sale. Active REOs and Short Sales: Of the active listings, there are 143 properties listed as short sales, (6.0%) and 63 properties listed as REO sales, (2.7%). Overall, the Tahoe-Truckee market has less than 9% of its active inventory listed as a short sale or REO. Active Inventory: Based on the current inventory and sales year to date the market has roughly 23-months of inventory available. Sales Summary: Total Sales 2009 vs 2008: On a year to date (YTD) basis there have been 469 properties sold in the market as compared to 572 for the same period in 2008 which is (18.0%) reduction in sales. For properties sold YTD 2009, 58 were REO’s, (12.4%), and 50 were Short Sales, (10.7%). For 2009, there have been 263 properties sold < $500,000, 156 properties sold between $500,000 and $1,000,000 and 50 properties sold > $1,000,000. Median and Average Sales Prices 2009 Vs 2008: The median sales price for the properties sold YTD in 2009 increased slightly to $453,000 while the average sale price is dropped to $569,834. For the same period in 2008, the median sales price was $515,000 and the average sales price was $718,986 which is an (12.0%) and (20.7%) reduction in price respectively. Last Week’s Sales: For the week of July 27th to August 2nd, there were 22 properties which closed in the market with two (2) of those sold at a price above $750,000. This past week’s closings were up slightly from the previous week. Pending Sales: Pending sales in the market increased to 182 which is slightly higher from the previous week. Market Activity Summary: Open house activity continues to be fair to good depending on the location of the open house. We are definitely seeing more tourists in town given the season which certainly creates more real estate interest and activity. Sales Associates are continuing to see more buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 45 homes in escrow scheduled to close in the next 30-60 days. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Now is the time to buy!
Vacaville/Fairfield—Solano County Coldwell Banker Agents are extremely resourceful. They are taking advantage of this lull in REO inventory and creating business the old fashioned way – by reaching out to their client base and community to help clients buy and sell homes. The agents are on FIRE and excited about this market and the opportunity it presents!

My overall synopsis of the market this week is much like it has been over the last several. Low-end sales have been the strongest segment of the market, an indication that the first-time homebuyers tax credit is contributing to the rise. The clock, however, is ticking on this credit and it may have buyers stepping up their shopping to get their purchases in under the wire. Because it may take as long as two months to close on a home after signing a contract, first time home buyers must act fairly soon to take advantage of the credit. To qualify, they must close on the sale by November 30.

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

It Was a Positive Week of News

2009-07-31T10:01:00.000-07:00

I have to say, it was a positive week for our industry. It seemed everywhere you looked, the media was reporting on some sort of positive indicator relating to the real estate market rebound. Last week I posed the question, is it a blip on the screen or are we finally out of the woods. It seems this week, the answer to the question is much clearer.

For starters, Good Morning America ran a very good interview on Tuesday about the state of the housing market. Liz Ann Sanders, the Chief Investment Strategist for Charles Schwab was interviewed. Essentially what she said was that we are in the process of bottoming out and “you have to go through less bad on your way to good.” As I’ve said in my weekly updates, we’re seeing pockets of significant strength and the housing market is really showing signs of recovery.
Our industry was the first to be hit by the market downturn and if all continues on this path, we will be the first out.

Now if I’ve said it once, I’ve said it a million times. The turnaround won’t be happening overnight. We probably won’t see housing numbers start to appreciate anytime soon. But what we can relish in is Sanders’ conservative viewpoint that “we have to see less bad for a while before we start to see some real positive gains.” What we have right now is the bottoming out of our market. Speculators and investors are competing with first time home buyers. Those individuals are going to continue to gobble up the inventory—both REOs and regular, now much more affordable starter homes. As we see this inventory deteriorate (again, over time), we will continue to see that trickle into our mid-level and upper-end price ranges.

Also interesting to note this week was the Standard & Poor’s/Case-Schiller 20-city index was released and in it, home prices in May posted their first monthly increase since the summer of 2006. Prices rose from April in 13 of the metro areas tracked, notably Cleveland, Dallas, Boston and the Bay Area.

The news followed reports showing sales of newly built and existing homes rose in June for the third consecutive month. New home construction, though still weak, is the best it’s been since the fall.

Although the index is rising nationally and locally, I would caution that this doesn’t necessarily apply to homes across the board. For the most part, the local gains are reflected more in the low-end side of the market, though we are showing signs of improvement in the mid and upper end.

The 20-city home price index rose 0.5 percent from April to a reading of 139.8, but it was still 17.1 percent below the reading of 168.6 in May a year ago. It was the fourth consecutive month that the index indicated prices have turned the corner and are heading back toward positive territory.

And with that news in tow, let’s take a look at this week in real estate:

Auburn—Still having appraisal issues and need more listings.
El Dorado Hills—The inventory level has remained very stable all year with around 355 active listings. The short sales have increased with 127 current short sales but only 19 REO properties. Properties are selling at around the 2002-2003 price point. Homes priced well are getting multiple offers and two Agents wrote offers this week on properties that had been on the market for 250+ days and now there are multiple offers.
Elk Grove—Agents working with buyers are writing offers at a feverish pace. This week we had several go into contract. One Agent wrote 11 offers over the weekend!!! We are seeing more and quicker short sale approvals. Fall out rate has jumped a little with buyers using lenders that promise, but don’t deliver
Placerville—Inventory in Placerville, like most of El Dorado County, is at a stable level with active listings under 200. Our short sale inventory has increased but we still have only 40 short sales and 17 REOs. The El Dorado County Board of Supervisors voted last night to approve proposition 90 for El Dorado County so homeowner’s will be able to transfer their property tax base from their existing county to a new home in El Dorado County. It should be great for our market when this takes effect.
Roseville Granite Bay—Decreasing listing inventory, and steady sales inventory. No multiple offers this week, but we did have eight ratified offers. Ten open homes but fairly light traffic possibly due to the heat? Short sales and sales of new homes are up, up! We are waiting…. still…for the REO flood!
Rocklin-Lincoln—Agents were pleased to hear that the “noise” we are making in regards to HVCC is being heard and one of the changes so far, is that they will be using appraisers local to that area.
Sacramento Sierra Oaks—The inventory is very low. A lot of “frustration” from the Agents in getting appraisals and loans. The whole process is getting bogged down and taking a lot longer.
Tahoe-Truckee—Active Listings: The listing inventory for the Tahoe-Truckee market remained flat from last week at 2,379 active listings in the market - 1,687 residential properties and 692 lots/land listed for sale. REOs and Short Sales: Of the active listings, there are 142 properties listed as short sales, (6.0%) and 60 properties listed as REO sales, (2.5%). Overall, the Tahoe-Truckee market has less than 9% of its active inventory listed as a short sale or REO. Inventory: Based on the current inventory and sales year to date the market has roughly 24-months of inventory available. Sales Summary: Total Sales 2009 Vs 2008: On a year to date (YTD) basis there have been 446 properties sold in the market as compared to 544 for the same period in 2008 which is (18.0%) reduction in sales. For properties sold YTD 2009, 56 were REO’s, (12.6%), and 47 were Short Sales, (10.5%). For 2009, there have been 250 properties sold < $500,000, 147 properties sold between $500,000 and $1,000,000 and 49 properties sold > $1,000,000. Median and Average Sales Prices 2009 Vs 2008: The median sales price for the properties sold YTD in 2009 dropped to 451,500 while the average sale price is dropped to $571,622. For the same period in 2008, the median sales price was $515,000 and the average sales price was $723,707 which is an (12.3%) and (21.0%) reduction in price respectively. Last Week’s Sales: For the week of July 20th to July 26th, there were 18 properties which closed in the market with four (4) of those sold at a price above $750,000. This past week’s closings were down from the previous week. Pending Sales: Pending sales in the market increased to 174 which is slightly higher from the previous week. Market Activity Summary: Open house activity was fairly light last week. Coldwell Banker open houses yielded average to low traffic depending on the location. Sales Associates are continuing to see more buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 54 homes in escrow which is 31% of the pending escrows. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Now is the time to buy!

This week I’ll leave you with a few interesting articles from the week:

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Existing Home Sales Up For Third Straight Month...The Question of the Day: Have We Bottomed Out?

2009-07-23T20:09:00.000-07:00

Some are calling it the sign that we have hit bottom and are on our way back up. Others are calling it a blip on the screen. Whatever your take, NAR released Thursday its existing home sales report which showed three key, positive indicators regarding the housing sector:

For the third consecutive month, existing home sales rose
Inventory is easing
Home prices declined less sharply in June

The report noted, “Existing home sales…increased 3.6 percent to a seasonally adjusted annual rate of 4.89 million units in June from a downwardly revised pace of 4.72 million in May, but are 0.2 percent lower than the 4.9 million-unit level in June 2008.

The report also revealed, “Total housing inventory at the end of June fell 0.7 percent to 3.82 million existing homes available for sale, which represents a 9.4 month supply at the current sales pace, down from a 9.8 month supply in May. Raw inventory totals are 14.9 percent below a year ago.”

The Wall Street Journal reported Thursday a look at 28 major real estate markets and where they are headed. The results (http://online.wsj.com/public/resources/documents/retro-HAGERTY.html) were interesting for Sacramento:

A 43.3% decline in housing inventory (from a year ago)
We are currently at a 2.7 month supply
We’ve seen a 42% drop in price since the peak

What all of this leads us to believe is despite some of the challenges we continue to face nationally and globally, the domestic housing market continues to demonstrate signs of recovery. The temporary first-time home buyer tax credit is clearly helping people make a decision and is contributing to the overall stimulus impact.

Are we out of the woods yet? It’s tough to say but the signs are encouraging and three months of continued increases in home sales are a positive sign that we may be on the road to recovery.

And with that news in tow, let’s take a look at this week in real estate:

Auburn—We’re still having appraisal issues. REOs and short sales are on the decline and listing inventory is decreasing.
Dixon Davis—No Inventory!!! Lots of buyers and no houses. Short sales and REOs want cash or conventional, so the 90% of the buyers with VA or FHA miss out. More inventory would help these buyers out. But I'm sure this is everywhere.
El Dorado Hills—Sales are ranging from $93,000 to around $550,00 the last few weeks with several under $300,000. Prices continue to decline in the million dollar plus range. Lots of multiple offers and appraisals are a challenge. One agent says if he just keeps his head down, keeps working, doesn’t look at the sales board and continues to work out the diverse escrow challenges, transactions are closing.
Elk Grove Laguna—Until we see an uptick in listings, every buyer will be fighting for property. With that in mind, average sales price has not yet increased.
Sacramento Fair Oaks—No information reported.
Folsom—Good solid week but not crazy like the first week or so of the month! Decent week for closings, listings and sales but still fighting some “agent attitudes” that need improving!
Sacramento Metro—Lots of buyers out there just waiting for bank approval on short sales.
Sacramento Sierra Oaks—No information reported.
Placerville—Inventory remains stable and we have a slight increase in sales activity. Very few REOs. However, the sun is shining and Placerville continues to be a gorgeous area with a lot of wonderful opportunities for the buyer looking for a lifestyle change. Very important to work with a local agent. The history and stories of this area are terrific.
Rocklin Lincoln—Still having appraisal issues and a very hard time with Ocwin. They do not return phone calls and they do not have utilities turned on in many cases. We had Rian from CAR political action at our meeting this week and it is very important that we respond to many of the bills that are being presented.
Roseville Granite Bay—Short sales are moving although still long timeframes. Still need REO inventory as buyers wait patiently. Appraisal issues continue with new HVCC codes.
Tahoe/Truckee—Active Listings: The listing inventory for the Tahoe-Truckee market increased slightly last week to 2,378 active listings in the market - 1,695 residential properties and 683 lots/land listed for sale. REOs and Short Sales: Of the active listings, there are 149 properties listed as short sales, (6.3%) and 56 properties listed as REO sales, (2.4%). Overall, the Tahoe-Truckee market has less than 9% of its active inventory listed as a short sale or REO which is dramatically less than many markets outside of the area. Inventory: Based on the current inventory and sales year to date the market has roughly 22.6-months of inventory available. Sales Summary: Year-To-Date (YTD) Sold 2009 Vs 2008: On a YTD basis there have been 427 properties sold in the market as compared to 528 for the same period in 2008 which is (19.1%) reduction in sales. For properties sold YTD, 52 were REO’s, (12.2%), and 45 were Short Sales, (10.5%). For 2009, there have been 238 properties sold < $500,000, 143 properties sold between $500,000 and $1,000,000 and 46 properties sold > $1,000,000. Year-To-Date (YTD) Sales Prices 2009 Vs 2008: The median sales price for the properties sold YTD in 2009 is $460,000 while the average sale price is $572,036. For the same period in 2008, the median sales price was $515,000 and the average sales price was $722,601 which is an (10.7%) and (20.8%) reduction in price respectively. Last Week’s Closed Sales: For the week of July 13th to July 19th, there were 25 properties which closed in the market with seven (7) of those sold at a price above $750,000. This past week’s closing was up dramatically from the previous week. Pending Sales: Pending sales in the market decreased slightly to 160 which is slightly higher from the previous week. Of the pending sales, 29% are either a short sale or an REO property. Market Activity Summary: Open house activity was fairly light last week. Coldwell Banker held a moderate eight open houses with average to low traffic depending on the location. Sales Associates are continuing to see more buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 48 homes in escrow which is 31% of the pending escrows. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Now is the time to buy!
Vacaville Fairfield—At the risk of sounding like a broken record, our market activity is same stuff, different week. First time home buyers, move up buyers and investors are in the marketplace. For those who are fortunate enough to secure a property, the buyers are typically offering more than the asking price. Cash continues to be king, followed by FHA and then VA. With the offers higher than the asking price, appraisals coming in at value continue to be an issue. Numbers: Currently in Solano County there are: 749 active properties ~ 962 pending ~ 83 sold (7/16/09- 7/23/09) our absorption rate in Solano County for all price ranges is currently 1.4 months.

This week I’ll end with a few words of wisdom to our clients:

Pricing and presentation is vital in today’s market. Buyers are paying attention to new inventory and current price reductions so if you want your home to remain competitive in today’s market, you need to consider this fact. I urge you not to test the waters when you place your home on the market. You will prevail if you price your home competitively from the beginning and present it in its best light possible. Listen to your Agent! Once you do this, great opportunities abound.

Until next week,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

A Rebounding Market

2009-07-17T08:57:00.000-07:00

This week a Realty Times article provided some insight into a rebounding market. Here are the highlights:

Pending home sales rose sharply, by nearly 7 percent, in the last month measured by the National Association of Realtors.
Pending sales were up in all four major regions of the country—and that caught the attention of some key industry economists.
Orawin Velz, economic forecaster for the Mortgage Bankers Association, said in a commentary that "the steady improvements in pending home sales are encouraging," and confirm the view that existing home sales hit their cyclical bottom in January and are likely to continue to rise in the coming months.
Since the January low point, she noted, the Realtors' pending sale index is up by 13 percent.
Mortgage rates continue to be favorable, an average of 5.3 percent last week for 30 year fixed rate loans, 4. 8 percent for 15 year fixed, and those rates are pulling in growing numbers of home purchase loan applications.
According to the Mortgage Bankers Association's weekly survey, new applications to buy houses increased by nearly 7 percent in the week ending July 3rd.

My overall assessment of the market is that while we are still seeing challenges out there, the market continues to show some encouraging signs. The fact is, we’ve seen the low-end of the market doing well for a while, but its starting to cascade to other segments of the market. We’re starting to see more activity and interest in the move-up market and luxury market.

There appears to be growing consumer confidence from buyers, perhaps as the stock market has stabilized and real estate is showing improvement. Also, buyers in our offices are telling us that they believe that the market overall is starting to recover and they don’t want to miss out on the buyer’s market.

Now let’s take a look at this week in real estate:

Auburn—No information reported.
Dixon/Davis—No information reported.
El Dorado Hills—Inventory remaining steady. Most sales are in the $200k to $600k range, very little activity in the million dollar plus. Several appraisals have come in quite low and we've lost a few transactions.
Elk Grove Laguna—No information reported.
Folsom— Crazy market. Average price is inching up but the majority of sales still being in the under $300,000 range. Floor seems to be good; Open Houses traffic is still strong and for Agents that are willing to work, the business is there!
Placerville— Average activity on all sales prices. Inventory is stable, very few REO or Short Sale opportunities. Two appraisals came in very high, that's a change, and one seller asked to increase the sales price. Agents that are working very hard are staying very busy.
Rocklin/Lincoln—No information reported.
Roseville/Granite Bay—No information reported.
Sacramento Fair Oaks—The buyers are still out there looking and writing offers but the inventory is very low. Actually the median price has risen this past month because of the low inventory. It is still a great time for the buyers to pursue buying and a great time for real sellers if thinking of upgrading to a larger home is a great opportunity.
Sacramento Metro—Market seems to have slowed a bit. Listing inventory is decreasing and sales inventory is steady.
Sacramento Sierra Oaks— We are experiencing a LOT of activity but with STRONG competition. Indications hold true that our inventory is light and really picked over. There a lot of Buyers (knowledgeable) and surprisingly a lot that do not have a working relationship with a Realtor. Opportunity abounds, but business is not coming easily.
Tahoe/Truckee— Inventory Summary: The listing inventory for the Tahoe-Truckee market increased slightly last week to 2,334 active listings in the market - 1,668 residential properties and 666 lots/land listed for sale. As we approach the busy months of summer more Sellers are placing their homes on the market for sale. Of the active listings, there are 140 properties listed as short sales, (6.1%) and 57 properties listed as REO sales, (2.4%). Overall, the Tahoe-Truckee market has less than 9% of its active inventory listed as a short sale or REO which is dramatically less than many markets outside of the area. Based on the current inventory and sales year to date the market has roughly 28-months of inventory available. Sold Summary: On a year to date basis there have been 386 properties sold in the market as compared to 493 for the same period in 2008 which is (21.7%) reduction in sales. For properties sold year to date, 47 were REOs, (12.2%), and 40 were Short Sales, (10.4%). The median sales price for the properties sold YTD in 2009 is $456,475 while the average sale price is $565,662. For the same period in 2008, the median sales price was $517,500 and the average sales price was $733,067 which is an (11.8%) and (22.8%) reduction in price respectively. For the week of June 29th to July 5th, there were 25 properties which closed in the market with seven (7) above $750,000. This week’s closing was a 47% over the previous week and the single highest week of closings in the past four months. Activity is definitely picking up. Pending sales in the market decreased slightly to 150 which is a 6% reduction from the previous week. Activity Summary: Open house activity is definitely picking up as more and more visitors are coming to the Tahoe-Truckee market. Over the 4th of July weekend we held 25 open houses with average to good traffic depending on the location. Sales Associates are seeing increased buyer activity and more and more are writing offers than in the previous six months. Coldwell Banker currently has over 40 homes in escrow which is 27% of the pending escrows. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Now is the time to buy!
Vacaville/Fairfield— Solano County is still experiencing a robust market in most price ranges. According to N.S.C.A.R. Solano County statistics; our median home price has dropped 37% in the last 12 months to $184,950. Our sales volume has increased 40% to 652 units in June 2009. Currently our average days on market is 50 days and declining. Going forward, currently 993 REO properties on the market, 2,403 Bank Owned “NOT” on the market and 3,082 NOD Notices filed.

Regardless of the market or the reason behind the recent upswing, things are starting to pick up throughout Northern California. It seems buyers are finally starting to get the message that we may have hit bottom and, as buyers take action, we’re slowly but surely working our way into a transitioning market.

It’s been a challenging ride but what we have to look forward to is exciting. Prepare. The coming months and into 2010 are going to be an exciting ride.

Make it a great week,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Reinvigorating the Housing Market

2009-06-11T18:46:00.000-07:00

This week there were some exciting change of events going on with the government. Realogy (Coldwell Banker Residential Brokerage’s parent company) President Richard Smith met with legislators regarding a positive development for the real estate industry. Specifically, the Business Roundtable (an association of chief executive officers of leading U.S. corporations)— of which Richard is the chair—issued a set of recommendations for the White House and Congress that are aimed at jump starting the housing market in order to stimulate a broader economic recovery.

The Business Roundtable’s recommendations are as follows:

· Keep mortgage interest rates at historically low levels (below 5 percent) for at least one year;
· Expand the current First-Time Homebuyer Tax Credit incentive from the lesser of 10 percent of the purchase price of the home or $8,000 to a higher limit of either 10 percent or $15,000 for all homebuyers, remove the income restrictions and include all primary residence purchases for one full year;
· Conduct a thorough review of current foreclosure mitigation and loan-modification programs in light of rising loan-modification re-default rates;
· Make permanent the current temporary conforming loan limits; and
· Continue to review and strengthen government efforts already underway to review and refine mortgage lending practices.

We believe targeted, demand-side solutions—such as the ones Business Roundtable is recommending—will provide a critical next step for a housing recovery that will help create jobs and boost the economy as a whole. To obtain a copy of the Business Roundtable press release and its Housing Working Group’s detailed recommendations, click here. To read an article that appeared in today’s online edition of The Wall Street Journal containing an interview about the Business Roundtable’s recommendations and why they are crucial to jumpstarting the housing market, click here.

Please understand that the legislative process is often a long and winding road that is hard to predict, but at some point in the future, we expect to call on you to make your voices heard in support of any new legislation in Congress that would advance these recommendations. We will communicate with you as these legislative opportunities occur—but for now, just know that we appreciate your support and are proud to be part of this initiative.

In other news this week, RealtyTrac released its foreclosure findings with positive news that foreclosure filings dipped 6% in May compared with April. But the news wasn’t all positive as the number is still 18% above this time last year. Essentially one in ever 398 homes received a foreclosure filing last month.

Here in California, the picture continues to be a bit more bleak. We are ranked No. 2 out of 50 states in foreclosure filings with 92,249 total filings or one in ever 144 households. Our numbers, however, are on the decline with a decline from April 2009 to May 2009 earning a 4.5% drop but from May 2008 to May 2009 earning a 22.8% increase. For a complete look at the USA Today story that ran on the figures, click here: http://www.usatoday.com/money/economy/housing/2009-06-10-may-home-foreclosures_N.htm#chart.

Now let’s take a look at this week in real estate:

Auburn—Activity has been slow for the last couple of weeks possibly due to school getting out and graduations. Also, the uncertainty of the interest rates seems to be keeping people from jumping in. Many are still waiting for the next wave of REOs.
Dixon/Davis—No information reported.
El Dorado Hills— We had 10 sales this week ranging from $68,000 to $652,000. 1/3 of our inventory is short sales and we have less than 20 REOs.
Elk Grove Laguna—Waiting for the wave. A lot of buyers cannot get property because of the tight inventory. There is by far more demand than supply.
Folsom— Same story different day…under $350,000 is really moving, anything else is selling if it is priced at wholesale levels! Phones are ringing and open houses are well attended. Agents are writing offers but each transaction is a lot of work to get it closed!
Placerville—Business is picking up with many walk-ins and finally some short sales are closing. Inventory is stable with very few short sales and REOs.
Rocklin/Lincoln—Listing inventory is decreasing while REOs and short sales are also on the decline. We continue to have issues with appraisals.
Roseville/Granite Bay—No information reported.
Sacramento Fair Oaks—The local market of Fair Oaks and Carmichael , Orangevale and Citrus Heights has been increasing in sales and new listings. My Agents are really energized and are working extremely hard. The Agents that do not work short sales or REOs are doing very well working off of past clients sellers and buyers.
Sacramento Metro—Local marketplace is good but not seeing much activity in the move up buyer.
Sacramento Sierra Oaks—The inventory is very low.
Tahoe/Truckee—Inventory Summary: The listing inventory for the Tahoe-Truckee market increased slightly last week to 2,177 active listings in the market - 1,552 residential properties and 625 lots/land listed for sale. Of the active listings, there are 132 properties listed as short sales which increased slightly, (6.1%) and 60 properties listed as REO sales, (2.8%). Based on the current inventory and sales year to date the market has roughly 7-months of inventory available. Sold Summary: On a year to date basis there have been 298 properties sold in the market as compared to 405 for the same period in 2008 which is (26.4%) reduction in sales. The median sales price for the properties sold YTD in 2009 is $450,000 while the average sale price is $575,163. For the same period in 2008, the median sales price was $515,000 and the average sales price was $721,017 which is a (12.6%) and (20.2%) reduction in price respectively. For the week of June 1st to 7th, there were only 10 properties which closed in the market with three above $750,000. Pending sales in the market remained constant at 140. Activity Summary: Open house activity for the past week was slow given the unseasonable rainy weather. Additionally, with graduation weekends occurring, visitor travel slowed. Sales Associates are seeing increased buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 40 homes in escrow and are seeing many offers on our listings. Lake Tahoe and Truckee properties are priced at levels we have not seen in five years and coupled with today’s low mortgage rates present great opportunities for interested buyers. Summer is right around the corner and we are anticipating more and more buyer activity.
Vacaville/Fairfield— Same story as last week. We have buyers, now all we need is inventory. Agents are even door-knocking to find homes for buyers!

I did want to let you all know that I will take a brief hiatus from Weekly Market Watch next week but will return the following week with another robust edition.

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Showing Activity In the Entry Level and Mid-Level Markets Continues to Rise

2009-06-04T16:24:00.000-07:00

Now that school is almost out, we’re finding many families are starting to look at homes in anticipation of getting settled prior to next school year. Showing activity, in many markets, has increased considerably.

Sellers are now getting their homes on the market and, in general, seem to be quite knowledgeable regarding staging and pricing. The homes in the entry-level market, for th most part, are moving well if they are in good condition and fairly and competitively priced. Several Agents whose clients’ listings are in the entry level market are reporting that they have had buyers lose out on homes in bidding wars. Could they be back? The competition for well priced homes in good condition is heating up and we are seeing multiple offer situations in most of our first time home buyer markets.

Though we have seen sporadic increases in the upper end market, it is still relatively slow on showings and closings but we do anticipate that that sector will loosen somewhat if the economic news continues to show some stabilization and an upswing.

Before I get into the week’s top news, what I would like to share is that LORE Magazine and The Wall Street Journal this week released their Top 400 list. You may view it online at http://online.wsj.com/ad/top400-articlecontinued.html. Many of our own Coldwell Banker Residential Brokerage colleagues we’re recognized within this coveted ranking and for that—along with all of their hard work and dedication—I salute them.

The most notable news this week was The Mortgage Bankers Association’s (MBA) release of is Weekly Mortgage Applications Survey for the week ending May 29, 2009. The Market Composite Index, a measure of mortgage loan application volume, was 658.7, a decrease of 16.2 percent on a seasonally adjusted basis from 786.0 one week earlier but was 14.4% higher than the same week a year ago. This increase is due, largely in part to the first time home buyer market which, as we know, has been vastly stimulated by a triple threat combination of low interest rates, the $8,000 first time home buyer tax credit and increased affordability. Together these incentives are finally getting buyers in the first time home buyer market off the fence and into the market which—once we get through the large number of REOs on the market—we should finally start to see some price stabilization.

But for those of you who are waiting for your homes to come back to their pre-recession values, be prepared to wait. A recent study that I read notes that real estate is now as affordable as its has been in the past 38 years (this of course relates to median homes when compared to median mortgage rates and incomes).

The fact is, the peak of unaffordability was in 2006, when an average family in the United States needed to spend 44% of their income to purchase an average single family home. Today, housing affordability in the United States is up to 73%. This means 73% of all new and existing homes sold in the first quarter of 2009 were affordable to families earning the national median income of $64,000.

A couple of other interesting articles of note this week:

- RISMedia’s First Time Home Buyers Grabbing Houses and Tax Credit (http://rismedia.com/2009-06-03/first-time-home-buyers-grabbing-houses-and-tax-credit/)
- Realty Times Multifamily Builder Confidence Up From Record Lows; Interest From Prospective Renters and Buyers Rises (http://realtytimes.com/rtpages/20090603_confidenceup.htm)
- Realtor.org Pending Home Sales Up For Three Months in a Row (http://www.realtor.org/press_room/news_releases/2009/06/phs_up)

Now, let’s take a look at this week in real estate:

Auburn—No information reported.
Dixon/Davis—Very very low inventory. Agents are working hard on short sales and waiting for more REO listings to come on the market.
El Dorado Hills—Inventory is stable with closings ranging from around $120,500 to $850,000. Most new sales are ranging in the $200,000 to $500,000 range. Lots of multiple offers in that range. We have buyers coming in from out of the area. Some first timers and some who have been waiting out the market the last year or two.
Elk Grove/Laguna—While the number of opens is a bit on the low side, the traffic counts remain high. Double digit traffic in all cases. Still the market driver on REO and short sales. The numbers of pendings have slowed due to lack of inventory and increased interest rates. Everyone, Agents and buyers, are waiting to see how the Tsunami of foreclosures will affect our market.
Folsom—We’re finely getting quite a few listings this week, most were in the $400,000 - $500,000 range. 11 closings for the week was very strong for us. It’s a great market!
Placerville—Appraisals are still an issue and we’ve seen a few sellers get “seller’s remorse” because they can’t find a new home to move to after their home is in escrow. Lots of really good land deals in desirable areas. Very few REOs or short sales.
Rocklin/Lincoln—No information reported.
Roseville/Granite Bay—We are looking for opportunities everywhere. Listing inventory and sales inventory is steady while short sales activity continues to bring in multiple offers.
Sacramento Fair Oaks—The local market of Fair Oaks and Carmichael, Orangevale and Citrus Heights has been increasing in sales and new listings. My Agents are really energized and are working extremely hard. The Agents that do not work short sales or REOs are doing very well working off of past clients, both sellers and buyers.
Sacramento Metro—No information reported.
Sacramento Sierra Oaks—The inventory is very low. Most of our business is REO and short sale.
Tahoe/Truckee—Inventory Summary: The listing inventory for the Tahoe-Truckee market currently stands at 2,152 active listings in the market - 1,532 residential properties and 620 lots/land listed for sale. Of the active listings, there are 128 properties listed as short sales which increased slightly, (5.9%) and 61 properties listed as REO sales, (2.8%). Based on the current inventory and sales year to date the market has roughly 8-months of inventory available. Sold Summary: On a year to date basis there have been 287 properties sold in the market as compared to 390 for the same period in 2008 which is (26.4%) reduction in sales. The median sales price for the properties sold YTD in 2009 is $450,000 while the average sale price is $575,558. For the same period in 2008, the median sales price was $511,150 and the average sales price was $720,726 which is a (12.0%) and (20.1%) reduction in price respectively. For the week of May 25th to 31st, there were 21 properties sold in the market with five above $750,000. Pending sales in the market remained constant at 140. Activity Summary: Open house activity for the past week was slow given the unseasonable rainy weather and the post Memorial Day weekend. Additionally, with graduation weekends occurring, visitor travel slowed. Sales Associates are seeing increased buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker currently has over 35 homes in escrow and are seeing many offers on our listings.
Vacaville/Fairfield—Same story…we have buyers, now all we need is inventory. This week we have had three failed sales due to appraisal issues. Each were “regular” sellers and we just could not get the value on the properties so therefore buyer/seller killed the deal.

I’d like to leave you with this. It is an excerpt of an article I found online that I think really should get us all thinking. As I visit our offices, what I hear from most is that things are changing and I think many of us agree—at least as far as the housing market is concerned—it seems we are on the path to recovery. Having said that, there are some buyers and sellers out there who continue to wait. For those of you (and you know who you are), please read on:

“…If you're a buyer, buy because you love what you're buying. Buy because the lifestyle you're looking to live can more easily be accomplished with the purchase than without. If you're selling, sell because you want to sell. Sell because you need to sell. Sell because your neighbor is driving you crazy. Sell because the house you've always had your eye on just hit the market. Sell to move up in the market. Sell to downsize. Sell to liquidate, but if you really want to sell, just sell already. If you're waiting to sell until markets rebound, please realize that doesn't mean to list in October. That means you'll be listing several years down the road, and the reason you were planning on selling in the first place might not exist at that magical time in the future. None of us are promised today, let alone tomorrow. Let alone 6 years from now when you can possibly sell your home for 15% more money.

If you're in no hurry to sell, do your neighbors a favor and take your home off the open market. If you're wanting to sell, be realistic in your asking price and aggressive in your hunt for a buyer. If you're a buyer, John Burns seems to be telling you that it's a pretty good time to buy. I'm telling you it's a good time to buy, and my reasons are not the same as Mr. Burns'. Buy because you want to. Buy because you can. Buy because you know the purchase will make you look like a real estate savant 15 years from now. Welcome to 2009 and the new rules of real estate. Sell low, hopefully buy lower.”

And with that, I’ll bid you adieux.

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Memorial Day is Over…Soon-to-be-Summer Selling Season Off to a Good Start

2009-05-28T22:41:00.000-07:00

With Memorial Day behind us and the busy summer selling season about to begin, some interesting trends are landing in our laps.

First, NAR this week announced that existing home sales rose in April with strong buyer activity, in, as expected, the lower price ranges. Nationally, existing home sales increased 2.9% to a seasonally adjusted annual rate of 4.68 million units in April from a downwardly revised pace of 4.55 million units in March, but were 3.5 percent below that 4.85 million-unit level in April 2008.

Most of the sales are taking place in lower price ranges but in a positive trend, we are seeing increased activity in the mid-price ranges. This is all a domino effect. A turnaround begins with the lower price range homes and once that sector of the market is stabilized, we begin to see changes in the mid and upper price ranges. The upper end, though we have seen increased activity, still is slow but we fully anticipate that this will change over time, too.

Many of you are asking me questions about the moratorium on foreclosures. In many markets we’ve had a foreclosure moratorium set forth by Fannie Mae and Freddie Mac as they wanted servicers to reduce interest rates, delay back payments and penalties, stretch the length of the loan or defer payments on part of the principal. The moratorium is likely going to be lifted soon and foreclosed properties are going to be released into the market starting (in many markets) in June and moving through the remainder of the year. In order for a recovery to be sustainable, we really need to clear through those distressed homes so we can begin to sustain a price recovery.

Here in California, this moratorium has really hindered sales. The demand for housing is outrageous—especially here in the Sacramento Tahoe region as buyers anxiously await the inventory to increase so they snatch up the listings. In some cases they are seeing 15, 20 offers on properties as they hit the market. The June release of the moratorium is expected to alleviate some of that demand.

A few local articles of interest this week that I wanted to be sure you saw:

http://www.sacbee.com/business/story/1889277.html
http://www.sacbee.com/business/story/1883546.html
http://www.dqnews.com/Charts/Monthly-Charts/Sac-Bee-Charts/ZIPSACB.aspx
http://sacramento.bizjournals.com/sacramento/stories/2009/05/25/daily28.html
http://sacramento.bizjournals.com/sacramento/stories/2009/05/25/daily30.html

Definitely worth the read and a great reminder of why we call this special place home.

Now, let’s take a look at this week in real estate:

Auburn—Agents are working with many qualified buyers but the buyers under $250,000 are losing out to investors with cash and quick closes. The sales we had this week were in the $300,000-$425,000 price range, so this is a good week. We had 2 appraisals come in over sales price, one was $7,000 more and the other $15,000 more and one came in $5,000 under sales price.
El Dorado Hills—I wish I had something amazing to report but our market remains pretty much the same. Inventory is up slightly (360) with only 17 REO properties and 105 Short Sale listings. Buyers are wary and appraisals are tough. We’ve had some successful price reductions during escrow based on low appraisals. Persistent negotiations throughout the transaction are paying off for buyers and sellers.
Elk Grove Laguna—The current level of extremely low inventory may be changing soon as some of the REOs being held back should be changing soon. In the meantime, it is still a battle for Agents and their buyers. Too many buyers and not enough properties. That is and continues to be the story.
Folsom—Crazy market, lots of buyers but hard to get then into a home under $300,000. Lots of competition for every listing. Out of 21 sales this week only five sales over $350,000 which is unusual for the Folsom Office. Listings could be better for this time of year.
Placerville—The number of homes on the market is stable and some of the homes coming on the market are reflecting price reductions from the prior six to twelve months. Very few REOs and all have multiple offers on them. We’re doing a lot of BPOs for potential short sales so should see some of those coming on shortly. Good walk in and phone traffic.
Rocklin-Lincoln—We have several new “regular” listings and a couple of the sales are on regular listings. Agents are working hours and writing many contracts that are not being accepted due to many cash buyers and multiple offers on the properties often listed below market. Many of the short sale listings coming on the market are listed at prices way below what the lender will require, but these brokerages are placing them in MLS so that they can get the calls and then they are letting the agent know that the lender will not probably go this low on the price.
Roseville-Granite Bay—Listing inventory is decreasing, as is sales inventory. One multiple offer; 9 ratified offers; 11 homes held open with a range of traffic, but on the lower end compared to weeks’ previous. Previews property activity on two listings. June inventory? We’re waiting for you! The buyers are eager, but mortgage rates are starting to rise.
Sacramento Fair Oaks—Listing inventory is has very low; therefore sales are too. Opens were hit and miss due to the holiday weekend. REO/Short Sale activity is very high the REO agents are selling what they have left in inventory back the activity is very high. The buyers are out there on a daily basis it is keeping my agent very busy showing property but losing out because of multiple offers and getting out bid.
Sacramento Metro—The office is extremely busy with good inventory in core areas.
Sacramento Sierra Oaks—The inventory is very low. It seems that in the price range of under $100,000 there are a ton of multiple offers.
Tahoe-Truckee—Inventory Summary: The listing inventory for the Tahoe-Truckee market currently stands at 2,167 active listings in the market - 1,523 residential properties and 644 lots/land listed for sale. Of the active listings, there are 131 properties listed as short sales which increased slightly, (6.0%) and 59 properties listed as REO sales, (2.7%). Based on the current inventory and sales year to date the market has roughly 8-months of inventory available. Sold Summary: On a year to date basis there have been 273 properties sold in the market as compared to 372 for the same period in 2008 which is (26.6%) reduction in sales. The median sales price for the properties sold YTD in 2009 is $450,000 while the average sale price is $577,829. For the same period in 2008, the median sales price was $515,000 and the average sales price was $721,927 which is a (12.6%) and (20.0%) reduction in price respectively. For the week of May 18th to 24th, there were 17 properties sold in the market with four above $750,000. Pending sales in the market remained constant at 139. Activity Summary: Memorial Day weekend was very active for open house activity as many second homeowners and vacationers were visiting the Tahoe-Truckee area. Coldwell Banker held over 25 open houses over the weekend with better than average visitor activity. Sales Associates are seeing increased buyer activity and more and more are writing offers than in the previous six-months. Coldwell Banker had nine (9) properties go into escrow last week with three above $750,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approached, we are anticipating more and more buyer activity.
Vacaville-Fairfield—Buyers are excited about the low interest rates, federal and state tax credits, and they are in the mood to buy! Investors who see an opportunity to cash flow are clamoring to acquire property and in many cases offering cash. Our issue with our ready will and able buyers is inventory. Of the “active” listings on the MLS in Fairfield and Vacaville, only 21% are listed as REO, of these listings, all are receiving multiple offers. Active Short Sales represent 38% of our inventory and appear to be the perfect solution for our buyers. But, these are not without issue; we find that lenders are reluctant to negotiate and the second lien holder (if different from the first) is willing to “kill” the deal rather than except what is being offered by the first. On the short sales, we find our biggest challenge appears to be lack of lack of communication and cooperation from the asset managers represents the lenders. The good news in Vacaville and Fairfield is with our pent up demand, prices in Solano County are moving up creating a great window for “regular” sellers to sell.

Historically speaking the week of Memorial Day quiets things down in the housing sector but this year it was a bit different. Thanks to the $8,000 first time home buyer credit, low interest rates and increased affordability, buyers in the first time home buyer market are out in droves and really are snatching up properties. Now that Memorial Day is behind us, we’ll probably see a week or two of quiet yet brisk activity until school is out and then…let the floodgates open. The summer selling season will be in full force.

Until next week,
Make it a great one,

Bob Bronswick
Coldwell Banker Residential Brokerage Sacramento/Tahoe

NAR Announces Housing Affordability Highest in 18 Years

2009-05-21T15:55:00.000-07:00

For months I’ve been sharing that this is one of the best times to purchase a home in decades. Well this week the National Association of Realtors underscored that fact with the release that nationwide housing affordability jumped 10 percentage points during the first quarter of 2009 to its highest level since the series began 18 years ago, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI). The HOI showed that 72.5% of all new and existing homes sold in the first quarter of 2009 were affordable to families earning the national median income of $64,000, up from 62.4% during the previous quarter and up from 53.8% during the first quarter of 2008.

Locally, the story is similar. In the Sacramento area, 76% of all new and existing homes sold in the first quarter of 2009 were affordable to families earning the area’s median income of $72,800. That’s up 1% from the previous quarter and up about the same from the same period a year ago.

For complete details on the report, click here: http://www.nahb.org/page.aspx/category/sectionID=135

I’d also like to share a couple of other stories of interest from the week:

Finally, many of you have asked me questions about the potential changes in the $8,000 tax credit (http://www.realtor.org/RMODaily.nsf/pages/News2009051202?OpenDocument). Essentially the U.S. Department of Housing and Urban development announced that the Federal Housing Administration is going to permit its lenders to allow home buyers to use the $8,000 first-time homebuyer tax credit as a down payment. FHA's approved lenders will be permitted to "monetize" the tax credit through short-term bridge loans. This will allow eligible buyers to access the funds immediately at the closing table. Here is a CNN Money article which explains some of the details: http://money.cnn.com/2009/05/18/real_estate/tax_credit_as_downpayment/index.htm?postversion=2009051912

While it is an exciting turn of events I would caution you that the execution of this is quite complicated and it may take some time before it becomes a reality. HUD will authorize lenders, non-profits and certain agencies to provide a bridge loan which will then be reimbursed at the time of tax refund. These players are not yet identified. Again, an exciting turn of events but the execution and timing of it have yet to be fully outlined. Watch for more to come.

You’ll note that this week’s edition of Weekly Market Watch does not include the office data and anecdotes. We’ll return next week with a robust edition.

As we head into this long, three day weekend I’d like to wish everyone a very happy Memorial Day weekend. Enjoy your time with BBQs, sunshine, maybe a little swimming and (hopefully) a home sale or two.

Until next week,
Make it a great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Recent Housing Stats Are Showing Encouraging Signs for Market

2009-05-14T17:11:00.000-07:00

This week I thought I’d share some positive stories that continue to permeate not only our local news but on a national level as well.

The National Association of Realtors® said its Pending Home Sales Index, based on contracts signed in March, rose 3.2% as first-time buyers waded into the market to take advantage of favorable prices and mortgage rates.

A report from the U.S. Commerce Department showed construction spending rose 0.3% in March, the first increase in six months.

The pending home sales report added evidence that sales have reached a bottom. “That's critical because once sales bottom, it's only a matter of time before you work off excess inventories. That's the key to stabilization in the financial system and the economy at large. We're closer to that than people thought just a few months ago.”

-- Michael Darda, chief economist at MKM Partners in Greenwich, Conn., “Sales and Construction Data Lift Hopes for Housing,” by Lucia Mutikani, Reuters, May 4, 2009.

On a national basis, the forces driving real estate right now are increasingly turning positive and encouraging.

Home sales in major markets around the country have shown dramatic gains in the past month.
In Florida, statewide sales jumped by 30% in March over year-earlier levels, and were up 33% over the previous month. Even condo sales were up by 25%.
In California, statewide sales rose 64% in March compared with March 2008. Unsold inventory is now just five months -- that's down from 12 months the previous March.
Median house prices may be bottoming out. The California Association of Realtors® reports the median price of homes sold was up by 2.2% for the past month.”

-- “Real Estate Outlook: Sales Rising in Some Areas,” by Kenneth R. Harney, Realty Times, May 5, 2009.

Also interesting to note:
The current price level of homes seems to be drawing more buyers into the market, according to Jim Gillespie, president and CEO of Coldwell Banker Real Estate. “We are seeing a lot of activity across the nation. Of course we're in the spring market, but we've seen more buyers in the market now than at this same time last year.”
“Home prices are where they should be. Sellers are accepting the current reality and are pricing more realistically," said Robert Abbott, co-owner and VP of a northern New Jersey brokerage. “More people are not only 'kicking the tires' but actually buying right now. We are showing significant activity when it comes to sales. The number of days for a house on the market is going down.”

-- “More Homes Get Multiple Offers; Downturn May be Nearing End,” by Julie Schmit, USA Today, May 6, 2009.

Multiple bids have picked up in recent months in California and other states hit hard by foreclosures and steep price drops, real estate executives say. “If a house is in a good neighborhood, is maintained and is a good value, it'll get multiple offers. One in 10 homes now draw multiple offers, up from one in 30 last fall.”

-- Julie Holt, owner of a title services company in Florida, “Is Now the Time for Some Home Buyers to Make a Deal?,” by Mark Koba, CNBC, April 28, 2009.

So what does all of this mean for our local market?

Well for starters, there is no question, we’ve definitely seen a sudden surge in sales. What a difference a year makes. Having said that, the biggest challenge affecting our market right now is the foreclosure moratorium that has greatly impacted the inventory levels and therefore sales, in the market. Take a look at this article from the Sacramento Bee this week: http://www.sacbee.com/business/story/1856386.html

We anticipate that this moratorium will end sometime in June which will increase our inventory levels and get our sales path back on track. Right now homes that do go on the market, in most areas, are scooped up immediately as buyers are chomping at the bit to get homes. Once the foreclosure moratorium ends, we should see a huge jump in sales.

And with that news in tow, let’s take a look at this week in real estate:

Auburn—We are seeing more mobile homes on the market than we have in the past few months. Cash is still the king when you are in a purchase with multiple offers. We have had a few very good floor leads that have turned into sales or listings. Appraisals have come in under the purchase price on a few contracts
Dixon/Davis—Not much change from prior weeks. Need inventory, we have lots of buyers and no houses to sell. We have 30 active homes in all of Dixon! New listings sell in one day often with multiple offers.
El Dorado Hills—Inventory seems about the same (344) but over 100 of these are short sales so our normal active listings are less than 250 so inventory is tight. Agents are making multiple offers and really looking for good homes that can be sold and closed. Open house activity is steady.
Elk Grove Laguna—No information reported.
Folsom—No information reported.
Placerville—We’ve had multiple offers on homes in Placerville and good listings are selling. Some homes that have been on the market for 100+ days have sold. We don’t have many REOs. Inventory is stable.
Rocklin/Lincoln—Agents are busy. Inventory that sat for a while now have pending sales and we have a slight shortage in the homes under $300,000. We will be having a “Summer Surge” beginning June 15th with activities to increase production and have fun.
Roseville/Granite Bay—Listing inventory is steady, while sales inventory is increasing. If only the REOs would do the same! The office saw two multiple offers and 16(!) ratified offers. There were only six open homes with very light traffic. Only one Previews-type listing. Same as before- we are playing the waiting game for more inventory.
Sacramento Fair Oaks—REO/Short Sale activity is very high. The REO Agents are selling what they have left in inventory. Activity at the high-end is slow. The buyers are out there on a daily basis. It is keeping our Agents very busy showing property but losing out because of multiple offers and getting out bid.
Sacramento Metro—The local marketplace is very good with inventory very low. The last four office tours have been great.
Sacramento Sierra Oaks—Inventory is very low which is causing decreases in sales activity. There continue to be a ton of multiple offers on the $100,000 and below price range.
Tahoe-Truckee—Inventory Summary: The listing inventory for the Tahoe-Truckee market increased slightly for the week. Currently, there are 2,045 active listings in the market - 1,423 residential properties and 622 lots/land listed for sale. Of the active listings, there are 124 properties listed as short sales which increased slightly, (6.1%) and 56 properties listed as REO sales, (2.7%). Based on the current inventory and sales year to date the market has roughly 9-months of inventory available. Sold Summary: On a year to date basis there have been 228 properties sold in the market as compared to 328 for the same period in 2008 which is (30.5%) reduction in sales. The median sales price for the properties sold YTD in 2009 was $428,850 while the average sale price was $573,071. For the same period in 2008, the median sales price was $509,000 and the average sales price was $731,217 which is a (15.7%) and (21.6%) reduction in price respectively. For the week of May 4th to 10th, there were 12 properties sold in the market with three above $750,000. Coldwell Banker was involved in five (5) of the sales. Pending sales for the week increased from 133 to 137. Activity Summary: Open house activity continues to be slow during this time of year in the Tahoe-Truckee area. Sales Associates are seeing increased buyer activity at all price points and especially on properties classified as short sales and REO’s. Coldwell Banker had four (4) properties go into escrow last week with one over $850,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approaches, we are anticipating more and more buyer activity.
Vacaville/Fairfield—Have Buyers! Need Homes! We are experiencing a true seller’s market in Solano County for homes priced under $350,000. Our inventory is down and has a result, listings are receiving multiple offers within hours of hitting the market. Buyers and Agents are very frustrated because they are having a difficult time securing a home. One of the things that we are doing to improve is doing a better job at communicating with each other regarding new inventory. We have implemented a white board within the office where Agents can post “coming soon” properties. We are also focusing on aggressively going after short sales to create additional inventory for our buyers.

In short, it seems buyers are finally starting to get the sense that now is a good time to buy and that if they wait, they may loose out on one of the best times in California history to purchase real estate. Now, if we could just get more listings. What a difference a year makes…I’m still scratching my head. It’s an exciting time so make use of it!

Until next week,
Make it great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Stress Test Reveals There’s More Work to Be Done By the Banks But The Local Real Estate Market Continues to Thrive!

2009-05-07T18:17:00.000-07:00

This week the results of the long-awaited Stress Test on the banks were released. What the government hoped to accomplish through this Stress Test was to determine how much more capital the banking sector would need to withstand the recession—much of which was caused by residential mortgages and other consumer loans such as credit cards. The result was that 10 of the nation’s 19 largest banks will need to raise a total of $74.6 billion in capital. The Stress Test revealed that banks like Goldman Sachs and J.P. Morgan seemed to be better positioned than Citigroup and Bank of America.

At this point, according to Kiplinger, “The stronger banks will actively do what they can to return any money borrowed from the government to get out from under restrictions on dividends and executive compensation. Their ability to sell common stock to the public is far better than their weaker counterparts, who may have to privately sell stock to investors or raise capital with so-called mandatory convertible preferred shares.”

According to industry analysts, it seems that until the banks get back on their feet, credit will continue to be tight. That leaves the Federal Reserve responsible for filling in the gaps with its own lending programs aimed at jump-starting lending.

On a brighter note, however, the real estate sector of our economy continues to show some positive signs—a good symbol that the programs that the government has put in place are helping. USA Today reported earlier this week that “More homes for sale are attracting multiple offers as buyers pursue lower-price homes and banks low-ball asking prices to attract competing bids on foreclosures.” It’s exactly what we’ve seen locally. Just as I revealed in an earlier blog posting, the first time, entry level home buyer market is fueling this recovery. It’s something we certainly forecasted and it’s finally coming to fruition. Now, we’re seeing, in many markets, multiple offers on starter homes and even some frustrated buyers who are scratching their heads and wondering what happened to the buyer’s market. We warned that the change could come before we knew it and in some price ranges, it might’ve already come and went.

Here are some links to some interesting, positive news stories from the week:

USA Today: More homes get multiple offers; downturn may be nearing end (http://www.usatoday.com/money/economy/housing/2009-05-05-foreclosure-home-sales_N.htm?loc=interstitialskip)
Business Week: Want to Sell Your Home? Lower Your Price (http://www.businessweek.com/lifestyle/content/may2009/bw2009055_075566.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis)
RISMedia: Relocation.com Survey Shows Consumers Moving Further Due to Economy (http://rismedia.com/2009-05-05/relocationcom-survey-shows-consumers-moving-further-due-to-economy/) – This is a good reminder to consumers on why they should choose an Agent who is affiliated with a large, global real estate company that has the breadth and influence to reach the largest pool of buyers.
NYTimes: Where Home Prices Crashed Early, Signs of a Recovery (http://www.nytimes.com/2009/05/05/business/economy/05turnaround.html?_r=2&hp)
Realty Times: Real Estate Outlook: Sales Rising in Some Areas (http://realtytimes.com/rtpages/20090505_realestateoutlook.htm)

Now, let’s take a look at this week in real estate:

Auburn—We are getting ready for the Auburn Home Show where we have great Agent participation.
Dixon/Davis—We haven’t seen much change from prior weeks. We need inventory! We have lots of buyers and no houses to sell. We have 30 active homes in Dixon! New listings sell in one day, typically with multiple offers.
El Dorado Hills—The market is picking up. Inventory remains at the same level but the pending sales have nearly doubled for the last 30 days. We haven’t had multiple offers on our listings but have been in many multiple offer situations with our buyers with as many as 10 offers on properties under $250,000. The upper end, over a million, remains stagnant but the 500 to 850 has picked up. Some of our high end sellers have temporarily removed their homes from the market but plan to go back on in around 30 days. Several short sales we’ve been waiting on for over three months have been approved. Appraisals continue to be a challenge.
Elk Grove Laguna—Traffic counts for open houses remain high. Buyers are scooping up the deals. It is highly competitive with multiple offers being the rule. Inventory is painfully low. Waiting for the next waive of REOs to hit. Floor call volume and LeadRouter calls continue to gain momentum. We are very busy.
Folsom—The market is crazy for the under $300,000 buyer. Most of our Agents write 5+ offers for a buyer before they get one into escrow! Listings are still hard for us to get, slow but steady. Our well priced homes are selling quickly and the over priced ones have no activity and no offers. Open houses are still good, but not the traffic we were getting a couple of weeks ago. We did sell a home that was held open this weekend to a buyer that came to the open house and fell in love with the property and had to have it! It’s a great time to be in real estate!
Placerville—Sales in the Placerville office are ranging from as low as $50,000 to $850,000. Inventory has dropped some. The walk in traffic continues to be active. Our REO inventory is very low and we’re not seeing multiple offers on our listings.
Rocklin/Lincoln—Sales are way up and listings are stable. We are getting about five new REOs a day in this area. Competition is fierce in the homes in the low $200,000. We had another short sale wit ha second accepted in just a couple of weeks. We had just a few open houses this week due to the bad, rainy weather but the few we did have received a few good leads.
Roseville/Granite Bay—Listings are steady; as is sales inventory. No multiple offers this period, but we did have seven ratified offers. Open homes were five with light traffic (rain, perhaps?). Roseville is still light on the REO/Short Sale inventory. Agents are ready for a strong summer as fresh inventory comes onboard. It’s time to line up the qualified buyers.
Sacramento Fair Oaks—Multiple offers are over abundant; it seems every accepted offer we have is a multiple. We had approximately eight homes held open and the Agents seem to have many interested buyers coming through. Overall the Agents are working extremely hard in my office are very positive. We have been working with them to prepare their buyers for the type of market we are in and the waiting periods that are involved.
Sacramento Metro—Business continues to be busy in our core areas. We are seeing many short sales but our REO business is slow.
Sacramento Sierra Oaks—The inventory is very low—thus activity is low. More inventory would be good for buyers!
Tahoe/Truckee Region—Inventory Summary: The listing inventory for the Tahoe-Truckee market decreased slightly for the week for the second week in a row. Currently, there are 2,013 active listings in the market - 1,391 residential properties and 622 lots/land listed for sale. Of the active listings, there are 119 properties listed as short sales which increased slightly, (5.6%) and 59 properties listed as REO sales, (2.9%). Based on the current inventory and sales year to date the market has roughly 9-months of inventory available. Sold Summary: On a year to date basis there have been 216 properties sold in the market as compared to 318 for the same period in 2008 which is (32.1%) reduction in sales. The median sales price for the properties sold YTD in 2009 was $425,850 while the average sale price was $569,379. For the same period in 2008, the median sales price was $508,000 and the average sales price was $736,302 which is a (16.2%) and (22.7%) reduction in price respectively. For the week of April 27th to May 3rd, there were 13 properties sold with two above $750,000. Pending sales for the week increased from 126 to 133 for a 5.5% increase. Activity Summary: Open house activity continues to be slow during this in between winter and summer season in the Tahoe-Truckee area. Once the summer season hits we should see increased open house activity. Sales Associates are seeing increased buyer activity at all price points and especially on properties classified as short sales and REOs. Coldwell Banker had three (3) properties go into escrow last week with one over $1,000,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approaches, we are anticipating more and more buyer activity.
Vacaville/Fairfield—It was a light open house weekend. Our area is ready to burst with REO inventory…when the banks release it! Activity is brisk in the offices. Agents are staying positive and are having honest conversations with their clients about the state of the market. Offers: Must write tens offers for clients to get a property into escrow. We are seeing appraisal problems coming up nowadays.

In a nutshell, this week there was a lot of rain which brought out the serious buyers and kept the lookieloos at bay. If the banks would release the inventory we’d be in great shape. We are having many appraisal problems in a lot of areas. It is supposed to be a great weekend which means that there will likely be lots of activity!

What do we do with this information? Spread the word! It’s one thing for me to talk about a recovering market but it’s another when even the most pessimistic analysts are doing the same. The stories above share the real story. All of our offices are reporting similar stories and as I visit our offices and talk with our Agents, I’m hearing the same scenario: the market is changing.

The window of opportunity has been open and it has been inviting buyers in for months. Now, the buyers are acting and if you were sitting, cooling your jets, it may be time to start your engine! Don’t wait until you’re kicking yourself and saying, “I should’ve bought a lot more real estate.”

Until next week,
Make it a great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

“The End is Near”

2009-04-30T16:24:00.000-07:00

Well last week I told you the week would bring some interesting twists to the market. And I was right. New mortgage applications for home purchases and refinancings were up 77 percent from the same week in April 2008.

Mortgage rates continue to average well below 5 percent – 4.7 percent last week on average for 30-year fixed rate loans and 4.5 percent for 15 year loans. Rates like these are a major factor pushing applications.

Nearly 600,000 home buyers have already claimed either the $7,500 tax credit from last year or the $8,000 credit for this year, according to IRS data cited by the National Association of Home Builders.

Also of interest, new home sales have been showing signs of improvement. Last week the Commerce Department reported that March sales were off just 0.6 percent, exceeding analysts’ expectations, after climbing in February.

In other positive trends, interestingly enough, The Wall Street Journal reported this week, “Analysts say: The end (of declines) is near. While new home sales show signs of stabilizing as builders cut back on building and boom-bloated inventories are slowly absorbed, prices of both new and existing homes are still being dragged down by a flood of foreclosures. Still, the experts were optimistic that the federal government's efforts to stem foreclosures eventually will have an effect by the end of this year or early next year; Mark Zandi, chief economist of Moody's Economy.com, even ventured (jokingly) a date when home prices would stop falling—December 15, 2009.”

Also be sure to check out this The Wall Street Journal story that ran earlier this week entitled More Homes in California Are Selling: http://online.wsj.com/article/SB124087905185761701.html

It’s hard to know whether or not the sum of these indicators is equivalent to a recovery but my sense is that the end is near—if we haven’t already passed it here in California (some experts are even saying that we’ve already hit bottom and we’re in slow recovery mode). When the bottom has hit exactly is hard to predict but based on what I am seeing in our offices, based on the statistics that I am seeing on pendings and buyer interest/activity and based on the overall national recovery effort, it seems the prediction by many experts (in late 2008) that we would hit bottom by the middle of 2009 is probably not far off.

Now I do feel it is important to point out, as I referenced in last week’s Weekly Market Watch, much of the recent turnaround is affecting the first time buyer/entry level market. We haven’t yet felt it in the mid-level and luxury end market. For specific news, check out this week’s LA Times article: http://www.latimes.com/classified/realestate/news/la-fi-stonebrook25-2009apr25,0,5952483.story. I point this out mainly because it is important for sellers in today’s market to remember that pricing is key and buyers are looking for a deal. So while changes are starting to take shape, we as sellers still need to be very competitive when pricing our homes so we can attract the largest pool of potential buyers.

Now for those of you who are “timing” the market, I have to caution you on this. The only way you know that the market has hit bottom is when it is on its way up. While certainly housing is one of the biggest and most important investments we will make in our lifetime, it is also important to remember that our home is so much more than an investment. It is where we raise our family, where we create memories and where we plant our roots. So as you try to “time” the market, remember these key facts and make sure that beyond the investment, you are choosing a home that will bring you the happiness you deserve. Because in the end, that is what matters most. Choose the home that is right for you and your family right now and for years to come. Historically speaking, California real estate brings long-term investment gains for almost all homeowners so if you choose the home that is right for you, you almost can’t loose.

Now, let’s take a look at this week in real estate:

Auburn— There are buyers out there but we are having a hard time getting the short sales closed and buyers are still wanting more with the request for repairs than most sellers want to do. We have had a couple of walk-ins that have led to a listing and a buyer. Energy level seems good. The floor person received several calls with regards to the article in the Sacramento Bee of the homes under $50,000.
Dixon/Davis—Not much change from prior weeks. We need inventory! New listings have been selling in one day with multiple offers. Lots of buyer calls.
El Dorado Hills—No information reported.
Elk Grove/Laguna—We are in a very steady pattern with ample active. Floor calls, open house traffic and short sale approvals are continuing at high levels. REO inventory is very low. We are seeing an increase in regular listings in the last few weeks. All in all the buyers are aware that the deals are there for the taking.
Folsom— Listing activity for Folsom is very good, but still mostly the lower end. Average list price this week was $482,000. Sales this week were great but again mostly the lower end properties, with an average sale price was only $388,000. Agent attitude is very positive and the business is getting done by a number of the Agents—not just one or two. Twenty five different Agents got a piece of business this week which shows that everybody is busy and the market is going!
Placerville—No information reported.
Rocklin/Lincoln—The Agents are busy but frustrated with the amount of offers they are writing for the same buyers and still not getting the home. One of the buyers elected to pay a little more and purchase a home that wasn’t a short sale or REO as he was tired of the games. The comments in the MLS are very creative with Agents requiring the buyer use a certain lender in order to get more closing costs paid by the seller.
Roseville/Granite Bay—Positive changes coming with more REOs in June and low interest rates. REOs and short sales are selling over price but we have low inventory right now.
Sacramento Fair Oaks—The Agents in the office are very positive they all are seeing activity in the market place. We are also seeing the “real seller” thinking about putting their home on the market. Actually we have more listings that are real sellers than ever before.
Sacramento Metro—No information reported.
Sacramento Sierra Oaks—Inventory remains very low. It seems that in the price range of under $100,000 there are a ton of multiple offers
Tahoe/Truckee—Inventory Summary: The listing inventory for the Tahoe-Truckee market decreased slightly for the week for the first time in three months. Currently, there are 2,023 active listings in the market with 1,410 residential properties and 613 lots/land listed for sale. Of the active listings, there are 113 properties listed as short sales, (5.6%) and 59 properties listed as REO sales, (2.9%). Based on the current inventory and sales year to date the market has roughly 10-months of inventory available. Sold Summary: On a year to date basis there have been 202 properties sold in the market as compared to 289 for the same period in 2008 which is 30.1% reduction in sales. The median sales price for the properties sold YTD in 2009 was $428,850 while the average sale price was $574,961. For the same period in 2008, the median sales price was $495,000 and the average sales price was $731,591 which is a 13.4% and 21.4% reduction in price, respectively. For the week of April 20th to 26th, there were 13 properties sold with only one above $750,000. Pending sales for the week increased from 112 to 126 for a 12.5% increase and is very encouraging. Activity Summary: Open house activity continues to be slow during this in between winter and summer season in Tahoe-Truckee. Once the summer season hits we should see increased open house activity. Sales Associates are seeing increased buyer activity at all price points and especially on properties classified as short sales and REOs. Coldwell Banker had six properties go into escrow last week with two over $1,000,000 and two between $750,000 and $1,000,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approaches, we are anticipating more and more buyer activity.
Vacaville/Fairfield—Inventory is still down and therefore our buyers are finding themselves in multiple offer situations for every home priced under $275,000. Another issue we have come up against this week is an extremely slow response time from the Asset Managers.

No matter how cynical you are about today’s economy—and trust me, with as much as we’ve all been through over the last few years, I certainly understand—it’s important to point out the positive signs that we are seeing in the local marketplace. All signs are definitely pointing towards a recovery.

Next week I will release my May Reality Check message and I will focus it on why today’s market brings such prime opportunities for savvy investors. I hope you will check it out.

Until then,
Make it a great week,

Bob Bronswick

First Time Home Buyers Are Finally Fueling the Comeback!

2009-04-24T14:00:00.001-07:00

It’s finally happening! In my August 2008 Reality Check message I discussed our market’s need for the revival of the first-time home buyer. Because, as we know, first time home buyers are a critical force that will help jump start our market rebound, creating that important domino effect that will ultimately benefit all price points.

Confused? Just think about it. If first time home buyers purchase entry level homes, that allows the entry-level homeowners to sell and move-up to a mid-level, move-up market. By purchasing those homes, the move-up market is able to sell and ultimately purchase homes in the luxury arena. It’s a much-needed domino effect that could catapult our market’s rebound.

Well I talked about it eight months ago but at least you can’t accuse me of being a day late and a dollar short. I guess in this case I was a day (or eight months) early and, as my wife would say, still a dollar short. But it’s finally happening and numbers released over the last two weeks are certainly proving that.

First, let’s look at NAR’s release this week of its March existing home sales. Now of course some media did use the nationwide decrease in sales as an opportunity to take a negative spin but there were a lot of positives in this news. First, nationally, prices rose from February to March by 4.2 percent which is much higher than the typical 1.8 percent seasonal increase between those two months.

Second, housing inventory at the end of March fell 1.6 percent to 3.74 million existing homes available for sale which represents a 9.8 month supply at the current sales pace.

In the West, existing home sales declined 4.2 percent to an annual rate of 1.13 million in March but, and this is a big but people, are 18.9 percent higher than last year at this time.

Now what do all of these numbers mean? Well the fact is, the share of lower priced home sales have trended up, indicating a return of many first-time buyers. Sales in the upper price ranges remain stalled but there are two reasons for this. First, jumbo loans still are difficult to obtain right now—though that may change in the second and third quarters thanks to the government’s work to restore this—and second, now that first time home buyers are once again entering the market, it will take some time for the domino effect to take shape onto other price ranges.

Another interesting note, the Mortgage Bankers Association this week released its Weekly Mortgage Applications Survey for the week ending April 17. The index showed an increase of 5.3 percent from the previous week and that was a 76.9 percent increase compared with the same week a year ago. Yes, 76.9, that’s not a typo.

Whatever you think about what our government is doing to revive our economy, it seems some of the early work like the first time home buyer tax credit is working. Earlier this week Inman News reported that the preliminary numbers from the IRS suggest 1.4 million taxpayers will claim the federal first-time home buyer tax credit on their 2008 tax returns, meaning the program is likely to meet or exceed the 2 million target set by lawmakers before it ends November 30, 2009.

Finally and I think this is probably most notable, the Wall Street Journal reported this week that prices have fallen back into line with what the typical household can afford to pay in most of the U.S. The report showed that home prices are dubbed “fairly” valued in 202 of the 330 markets studied. That means the average price level is within a band 14% above or below the historical norm. Twenty-one markets are “overvalued” or between 14% and 34% above the norm. And 106 markets are considered “undervalued” or more than 14% below the norm. Take a look at this graph which showcases where we were in the early part of the decade as compared to today:

Now I know some of you are scratching your heads and saying, how is the drop in property value a positive thing. But the fact is that though the ride was nice in the big real estate boom of the early 2000s, we couldn’t sustain those types of record appreciation levels without eliminating certain consumer niches, including first time home buyers. Now that levels are back within range, the first time home buyers are once again able to reenter the market which is why we are seeing such a strong surge in sales in that level.

It’s just a matter of time before we weed through the remaining banked owned inventory and we should begin to see prices stabilize. Once we see that, the remaining areas of the market should begin to see an upswing, too.

With that said, let’s take a look at this week in real estate:

Auburn—The energy level has picked up and we are seeing many offers being written but the cash ones seem to be winning even if they are considerably lower than those with a loan. Our REO Agents are being given many BPOs to process but have not been given the go ahead to put them on the market. We are having a little challenge with the verbiage in the listings that state there must be a pre-approval from a direct lender even on FHA/VA loans and yet FHA/VA loan letters must be called “prequel” per HUD.
Dixon/Davis—We had three new banks call with listings, no referral, and using CAR forms! Inventory low, multiple offers on everything. Short sales are still frustrating and slow. Buyer calls are high. We’re all waiting for the REO listings to be released! Agents are working hard and taking on the challenge of this market with good attitudes and team efforts.
El Dorado Hills— The inventory is about the same but the pendings in the last 30 days have doubled from previous months. Open house activity is strong and buyers seem more serious. We're not seeing many multiple offers. We had three short sales we've been working on for several months get approved but overall the short sale process is dragging on for months. We've been waiting nine months on one transaction.
Elk Grove Laguna—We have had seven new listings and 15 sales. We held at least three open houses one of which had 15 people through and another had six. We have continued to see multiple offers on properties. As for short sales we had one approved in two weeks—with Kathy's package Wells Fargo has committed on another to approve or reject in 37 days. Activity continues to remain strong with high demand for homes in the south county.
Placerville—Inventory has shrunk some, partially due to withdrawn and cancelled listings. These seem to be sellers removing their homes from the market because they don't need to sell. No multiple offers. Our walk ins have tripled and are serious buyers.
Rocklin/Lincoln—The energy level has picked up and we are seeing many offers being written but the cash ones seem to be winning even if they are considerably lower than those with a loan. The Agents are finding that the well priced homes are gone within a day or so of the listing.
Roseville/Granite Bay—The listing inventory is growing and the sales inventory remains steady. We are not seeing many multiple offers at this time. Of the nine homes held open, traffic ranged between 2-27 groups. Many short sale offers out without approval. We saw activity on two of our Previews listings. We are waiting patiently for the REO tsunami to hit.
Sacramento Fair Oaks—The listing inventory in the office has been down this past month. Also overall in all areas of Sacramento. In terms of multiple offers, there are a lot. Every Agent in the office meeting raised their hand about multiple offers—around 40. Open house traffic is pretty steady but depends on the location. I had a few Agents, one in Arden Park who stopped counting after 40 potential buyers came through. Others had around five or six. REO sales are good if you have any inventory left. They have sold very quickly. Yes a lot of our inventory is short sales and the same thing with them.
Sacramento Metro—We’re seeing good inventory in our primary marketplace. Properties are selling within 30 days. We have had 21 new listings in the last two weeks and 50 sales in the last two weeks. We have had a total of 50 ratified offers in the last two weeks. It’s busy!
Sacramento Sierra Oaks—Listing inventory is increasing while sales inventory is steady. It seems that in the price range of under $100,000 and up to $300,000 there are many multiple offers. We are starting to notice more activity in our higher end listings. For the rest of the market, inventory remains low.
Tahoe/Truckee Region—Inventory Summary: The listing inventory for the Tahoe-Truckee market increased slightly for the week bringing the total active listings to 2,035. Currently, there are 1,418 residential properties and 617 lots/land listed for sale. Of the active listings, there are 113 properties listed as short sales, (5.6%) and 57 properties listed as REO, (2.8%). Based on the current inventory and sales year to date the market has roughly 11-months of inventory available. Sold Summary: On a year to date basis there have been 189 properties sold in the market as compared to 276 for the same period in 2008 which is 31.5% reduction in sales. For the week of April 13th to 19th, there were 11 properties sold all priced below $750,000. Activity Summary: Open house activity continues to be hit and miss as this is a very slow time of year for visitors to the area. Once the summer season hits we should see increased activity. The Sales Associates are seeing increased buyer activity with multiple showings at all price points. Activity on short sales and REO’s remains brisk with multiple offers occurring. We had two properties go into escrow last week. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approaches, we are anticipating more and more buyer activity.

Next week will bring some more interesting news. Check out this article that ran Monday in The Wall Street Journal: http://www.washingtonpost.com/wp-dyn/content/article/2009/04/19/AR2009041901875.html. Once we see the results of new home sales (existing home sales were already reported), we should have a better indicator of where we are. I’ll leave you with this excerpt from the The Wall Street Journal’s story:

“Whatever the March numbers say, there are good reasons to think that home sales will improve as the spring selling season gets underway. Anecdotal reports suggest that low mortgage rates and an $8,000 first-time home-buyer tax credit are coaxing buyers back into the market. And while foreclosures are set to rise as banks begin to move on delinquent homeowners, that actually could boost home sales as banks auction homes for whatever the market will bear.”

The market is without a doubt changing and we may finally be seeing the end of the great housing challenge of the 2000s. I for one am very happy to see it.

Until next week,
Have a great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

Are Happy Days Here Again?

2009-04-09T21:33:00.000-07:00

We awoke Thursday morning to some very positive economic news—Wells Fargo reported a better-than-expected first quarter profit of $3 billion surging the company’s stock by 32% and boosting shares of many other big banks as investors bet that Wells Fargo’s peers may also post results that exceed Wall Street’s estimates. The hope by all involved is that the banking sector is stabilizing. Much of Wells Fargo’s recent success is in part related to the recent increases in mortgage loan applications which could be a strong sign that consumer confidence is on the rise.

Also revealed this week is the fact that new jobless claims fell more than expected. The Labor Department said Thursday that the tally of initial jobless claims fell to a seasonally adjusted 654,000 from a revised 674,000 the previous week. Analysts expected claims to drop to 660,000

This week there were so many positive headlines that, rather than provide you with my ongoing synopsis, I thought I’d give it to you straight from the horse’s mouth. Yes, even the media is now on board with the positive headlines which tells me that the market is definitely changing.

New jobless claims, trade gap fall; retailers see signs of hope; http://www.usatoday.com/money/economy/2009-04-09-jobless-trade_N.htm
Big rally on Wall Street; http://money.cnn.com/2009/04/09/markets/markets_newyork/index.htm?postversion=2009040918
The case for buying a home right now; http://online.wsj.com/article/SB123913901841798375.html
With affordability up, home buyers are returning to the market; http://www.nahb.org/news_details.aspx?sectionID=0&newsID=9000
Outlook on economy is brightening; http://www.nytimes.com/2009/04/07/us/politics/07poll.html?_r=1&scp=23&sq=economy&st=nyt
Real Estate Outlook: Promising Numbers; http://realtytimes.com/rtpages/20090407_realestateoutlook.htm

And with that very exciting and uplifting news in tow, let’s take a look at this week in real estate:

Auburn—Listing inventory is about the same this week while sales inventory is changing. REOs declined and short sales increased. We had one short sale accepted and another waiting approval from the second. We have had several floor calls from prospects here for Easter. Two of our listings came from floor calls. We are still writing several offers for each buyer before they are in contract.
Dixon/Davis—We had six REO listings this week. We have a lot of contracts out right now waiting on acceptances or counters. Short sales and REOs are our market! Half of Dixon’s active inventory is contingent because of short sales.
El Dorado County—The El Dorado County market is moving steady. Floor in both offices has been busy with walk-ins in both offices and two listings taken in El Dorado Hills from floor calls. Good follow up by the floor Agent. Open house activity is steady. The inventory is down a little this week but the percentage of short sale listings is up and the number of REO listings is down. Most of the accepted offers are below $500,000. Placerville has only 10% of the listings are short sale listings. Pending price range is also lower than last year.
Elk Grove/Laguna—The phones are ringing off the hook. One Agent had 11 calls in a two hour shift. Inventory is extremely low and REOs aren’t coming on as fast as they were. Anything priced reasonably well is receiving a lot of activity. Multiple offers are very common place.
Folsom— Wow! What a terrific market! Ten sales in the first two days of the week is very good for the Folsom office. Every Agent is working with multiple buyers and the buyers seem to be qualified and ready to buy! Floor time is strong and opens are well attended. I think it’s a great time to buy real estate!
Rocklin/Lincoln—We have had several floor calls from prospects here for Easter. The Agents have been contacting past clients and have received several referrals. The Agent with the open house of over 150 people a couple of weeks ago has already received several referrals. The Agents are busy with buyers as the inventory is down.
Roseville-Granite Bay—We had the best traffic for 2009 last weekend. Looking forward to those REOs coming out. It seems that banks and the government are holding onto their REOs right now. California banks have repossessed over 80,000 homes and have not put them back on the market yet!
Sacramento Sierra Oaks—Sales inventory is the rise. We had 24 ratified offers this week! Open house traffic remains very busy. Inventory is very low.
Tahoe-Truckee Region—Inventory Summary: The listing inventory for the Tahoe-Truckee market increased by 48 new listings for the week bringing the total active listings to 2,019. Currently, there are 1,414 residential properties and 605 lots/land listed for sale. Of the active listings, there are 110 properties listed as short sales, (5.4%) and 52 properties listed as REO, (2.6%). There were nine new short sale properties listed last week. Based on the current inventory and sales year to date the market has roughly 12-months of inventory available. Sold Summary: On a year to date basis there have been 163 properties sold in the market as compared to 247 for the same period in 2008 which is 34.0% reduction in sales. For the week of March 30th to April 5th, there were 15 properties sold with ten (10) priced below $750,000 and five (5) priced above $750,000. Activity Summary: We held nine (9) open houses over the past weekend with minimal activity. One lakefront property listed at $3,500,000 had 15 groups visit the property which was clearly the most active. The Sales Associates are seeing increased buyer activity with multiple showings at all price points. There were twelve (12) showings on properties priced at $750,000 or higher and nine (9) showings on properties priced below $750,000. We had two properties go into escrow last week with the largest being $1,325,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Lake Tahoe and Truckee properties are priced well and present great opportunities for interested buyers. As the summer season approached, we are anticipating more and more buyer activity.
Vacaville/Fairfield— The market in Solano County is robust! Our inventory is down due to the lack of REO properties being released by the banks and our buyer activity is up! Most of the properties listed under $300,000 are receiving multiple offers and our Agents are coaching their buyers to be aggressive in their offers.

Now what should we do with these positive stories? Don’t look a gift horse in the mouth! Spread the word. One of the biggest challenges hindering our sector right now is low consumer confidence. We’ve just finished three years of a very gloomy and challenging time in United States real estate. And while this optimism can’t yet be explained by official statistics, which lag behind the current market by 30-60 days, pendings are up in many markets and units sold are certainly on the rise. It’s time to target our family, friends and clients alike and educate them on the opportunities and possibilities in today’s market. The time is right now. The market is poised for a rebound. With the $8,000 first time home buyer tax credit, the historically low interest rates, the high rate of affordability—we couldn’t be in a better position for a rebound. Read my lips: spread the word! Tell your friends. Tell your family. If you’re considering buying a home, now may just be the perfect time.

Next week I will be taking a brief hiatus from Weekly Market Watch. I’ll return the following week with another exciting, robust edition.

Have a great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

I’m Invigorated!

2009-04-02T18:53:00.000-07:00

Okay, I know that headline seems a little exaggerated and maybe even a little far-fetched, but honestly I am. I don’t know if it is a combination of the sun, the clean Spring air and the excitement that seems to be brewing in our offices, but I can feel that change is abuzz in the real estate market and for the first time in a long time, I’m truly invigorated!

This week was yet another week of milestones. Several weeks ago I questioned, are all of these positive indicators the start of a trend or are they just that, positive indicators that will have a short shelf life. Well, after at least four weeks of some strong, positive gains, I truly am invigorated.

This week, NAR released its Pending Home Sales Index, a forward-looking indicator based on contracts signed in February, reporting that pending home sales rose 2.1 percent to 82.1 from a reading of 80.4 in January. Pending home sales have a way to go for there to be a meaningful increase, but recent increases in shopping activity are hopeful indicators that we’ll see additional sales gains.

NAR’s Housing Affordability Index also rose 0.9 percentage points to a record high of 173.5 in February from an upwardly revised index of 172.6 in January, and is 36.3 percentage points higher than a year ago. This broad measure of housing affordability using consistent values and assumptions over time, shows that the relationship between home prices, mortgage interest rates and family income is the most favorable since tracking began in 1970. 1970!!!!

Also interesting, Inman News released a survey this week noting that of the 225 readers who responded to an online survey from March 23 to April 1, 48.9 percent said housing markets in their area were improving, 27.1 percent said they were stabilizing and just 12.9 percent characterized them as worsening.

That, along with the indicators I’ve referenced over the last several weeks including last week’s jump in mortgage applications, the historic drop in interest rates and the surge in new housing starts, we truly are seeing some very positive and indicative signs of recovery. I truly believe that buyers are seeing inventory move and that gets them moving.

It seems some of Obama’s various recovery efforts are starting to have some effect on the market. The billions to slow foreclosures and goose bank lending, plus the tax credit, are getting buyers to move which is a positive sign.

Now, of course, we’ll have to keep our eye on it and watch as the market continues to progress through our traditionally busy Spring selling season, but thus far the signs are positive and my magic eight balls says “Outlook is Good.”

With that good news in tow, let’s take a look at this week in real estate:

Auburn—We’re seeing a lot of good open house activity. This week we saw a lot of multiple offers on our REO and short sale properties with some properties receiving up to 20 offers. The REOs were all sold to cash buyers even though they received other offers using FHA for several thousands more. REOs are few and far between though short sales dominate the homes on the market. We have had a couple of normal sales as well. We are getting a lot more calls regarding financing and first time home buyers.
El Dorado Hills—Our listing inventory is steady with about 10% REO listings and a slight increase in our short sale listings to nearly 30%. Open house activity is sporadic and some buyers are seeing good opportunities but many are hoping prices will continue to come down. We did have at least one buyer who is relocating from Oregon tell us he was thinking of buying in June but feels the market has reached bottom and he wants to get going before the “rush.”
Elk Grove Laguna—We had fewer open houses this week but traffic counts remain high. The trend is consistent. We have lot of buyers—both first timers and investors. The phones are ringing and Agents who are working a plan are flourishing.
Folsom—Activity is up and Agents seem to be smiling more! Not a lot of listings this week but the average list price for the Folsom office was only $1,753,000! OK so having only four listings and one at $4,700,000 helped pop the numbers up a little bit! Ratified sales were good but an average price of $330,000 is still quite low. We had 12 closings for the week which was good but once again price per unit is low!
Placerville—The Placerville office had a really good month for new sales. The inventory is also steady but the buyer traffic is very optimistic. Buyer’s are commenting that they believe the market is at or near the bottom of the market and want to make a move now. The media seems to be helping at this time. We don’t see a lot of open houses because of the geographic location of many listings.
Rocklin-Lincoln—Open house activity seems to be good. REOs are not coming on the market as frequently as in the past. It was not unusual to see 12+ any one day in the Rocklin/Lincoln area and now the most seen in one day has been four.
Roseville-Granite Bay—Both inventories are increasing; no multiple offers, 8 ratified offers. We had seven opens with 0-10 attendees at each. Seems a little bit more upbeat. Agents have buyers and are looking to find the correct sales situation. Obviously buyers can dictate the prices except for the REOs. Agents are correctly focused and reading for a good Spring market.
Sacramento Fair Oaks—Sales inventory is steady, Listing inventory is declining. We had 14 multiple offers, seven ratified offers and six opens with 78 groups through. REO/ Short sale activity is pretty good. The market is good- there are real sellers getting off of the fence. The market’s little inventory means more multiple offers come into play and has been raising the strike price a bit. Great opportunity to get buyer’s into the market. Sellers should take advantage of the REO moratorium and if it is priced right, it will sell.
Sacramento Metro—Open house activity is good in core areas. Activity has increased within the last 10 days with a great month of 100 sales and 78 closings. The REO/short sale market remain slow.
Sacramento Sierra Oaks—The price range of under $100,000 is seeing a ton of multiple offers. Overall our local market is seeing very low inventory which should, over time, help to drive up prices.
Tahoe-Truckee Region—The listing inventory for the Tahoe-Truckee market remained relatively stable from the previous week. Currently, there are 1,369 residential properties and 602 lots/land listed for sale. Of the active listings, there are 101 properties listed as short sales, (5.1%) and 52 properties listed as REO, (2.6%). The median price for the active short sale properties is $410,000 and for the REO properties is $399,000. Based on the current inventory and sales year to date the market has roughly 14-months of inventory available. On a year to date basis there have been 146 properties sold in the market as compared to 230 for the same period in 2008 which is 36.5% reduction in sales. For the week of March 23rd through 29th, there were 17 properties sold which is double from the week prior. We held seven open houses over the past weekend with very little activity. The Sales Associates are seeing increased buyer activity with multiple showings at all price points. The short sale and REO properties are receiving the majority of the initial interest from buyers. However, buyers are realizing there are great values as well in the non short sale and REO inventory. We had three properties go into escrow last week with the largest being $809,000. It is apparent that buyer interest and activity is picking up as there are continued great values in the market.

As you can see, the market is heating up. Consumer confidence is finally on the rise and buyers are edging off the fence. For those who are still cautious, please consider all of the positive signs that are knocking at your front door. From the first time home buyer credit to the historically low interest rates to the increases in conforming loan limits to the generous amount of inventory to the motivated sellers to the…honestly, the list goes on. Opportunity is knocking and it is time for buyers to recognize this and jump in.

Until next week,
Have a great one,

Bob Bronswick
President
Coldwell Banker Residential Brokerage Sacramento/Tahoe

From A Slow Crawl…To a Brisk Walk

2009-03-26T16:57:00.000-07:00

I heard someone earlier this week say that the housing market has gone from a slow crawl to a brisk walk. I think that is the perfect metaphor to explain the recent changes in the real estate market. The market is coming back. It’s not roaring, but it’s coming back.

This week, according to Reuters.com, U.S. mortgage applications jumped as record low interest rates spurred a surge in demand for home refinancing loans. The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, increased 32.2 percent to 1,159.4 for the week ended March 20. Refinancing accounted for 78.5 percent of all applications.

Furthermore, interest rates on mortgages fell after the Federal Reserve last week said it would buy Treasury securities for the first time in more than four decades as well as more than double its planned purchases of mortgage-related securities. Reuters.com reported that “Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 4.63 percent, down 0.26 percentage point from the previous week, reaching a record low….Interest rates were well below year-ago levels of 5.74 percent.”

Meanwhile, according to Realty Times, housing starts took a surprise jump of 22 percent in February over January's depressed levels. Most of the increase was attributable to apartments and condominiums, but single family starts were up by one percentage point, and new home permits were up by 11 percent, after months of sharp declines.

Existing home sales are also seeing some good trends. NAR reported this week that sales activity for single family, townhomes, condominiums and co-ops rose 5.1 percent to a seasonally adjusted annual rate of 4.72 million units in February from a pace of 4.49 million units in January.

The West is leading much of the nation’s recovery, with California leading the charge. Our median listing price is beginning to rise for the first time in three years. Existing home sales in the West increased 2.6 percent to an annual rate of 1.2 million in February and remain 30.4 percent higher than a year ago.

Last week I recommended that you watch Coldwell Banker president and CEO, Jim Gillespie on CNBC’s “Roadmap to Rebound” which focused on the state of the housing market. If you missed it, Gillespie stated that “the government could do a lot more than they are already doing in order to get the real estate market moving again.” Congressmen and economists continually say that in order to get the economy going, we need to first get real estate going. Gillespie believes that two key changes are needed in order to get the economy moving, and the first item that needs to be addressed is to set a fixed-rate mortgage. “Lowering the interest rate to 4% to 4.5% for 12 months is one way to get the inventory moving.” Along with setting a fixed-rate mortgage, increasing the tax credit to $15,000 and including all buyers of primary residences will help move buyers along and get the market to shift.

Gillespie also stated that the demand side needs to be looked at closely, because once we start to burn off the inventory that we currently have, prices will begin to stabilize and go up again, which will help those in distressed situations. “Fifty-five percent of loan modifications have failed after six months because jobs are not being created and homeowners are losing the jobs they have,” says Gillespie. “In order to create jobs, we need to create demand, both of which will get the housing market and economy moving.”

I for one appreciate seeing our leadership team speaking out on our behalf, serving as the visionaries for our industry. It’s enlightening and certainly makes me proud.

Now, let’s take a look at this week in local real estate:

Dixon-Davis—The market continues to be the same. Listing inventory is down. Our Agents are going to do some listing marketing in our area. Buyer activity continues to be busy and time consuming.
Elk Grove-Laguna—Open home traffic has a good trend right now. The traffic counts continue to be consistently in the double digit range. We had one Agent who had 43 people through one open house. The bulk of our business is in REOs/short sales and what a difference a year makes. Approvals—within a couple of weeks in many cases. We continue to see a dramatic increase in buyer activity. Inventory levels are the lowest they have been in the last three years. Our closes average sales price increased for the first time in two plus years.
Folsom—We’re seeing great closings and strong open escrows! Our listings are still slow coming in but lots of Agents are working buyers and not just the low end. We had five ratified offers this week and 11 closings. We had some good luxury activity this week. One listing of $1,500,000, one sale of $1,300,000 and one recording of $650,000. It was a good week!
Roseville/Granite Bay—We have steady inventory on both ends including two multiple offers and nine ratified offers as well as seven opens with various traffic levels. The buyers are still reluctant and sellers are getting squeezed on equity and repairs. The Agents are being very positive and are staying with our motto “look for opportunities.”
Sacramento—Our Sacramento Metro office reports that sales have increased in our core areas this month. We have very few REOs but short sale activity is up in the office. Activity level in our luxury market is also up. We had one $900,000 sale and one listing for $1.8 million. Our Sacramento Sierra Oaks office reported 23 ratified offers this week. It seems that in the price range of under $100,000 there are a ton of multiple offers. Open house traffic has been very busy. The inventory in this market is very low.
Tahoe/Truckee Region—The listing inventory for the Tahoe-Truckee market had an increase of 17 new land/lot listings while the residential listings increased by three properties. To date, there are 1,385 residential properties and 605 lots/land listed for sale. Of the active listings, there are 104 properties listed as short sales, (5.2%) and 51 properties listed as REO, (2.6%). The median price for the active short sale properties is $384,950 and for the REO properties it is $394,900. Based on the current inventory and sales year to date the market has roughly 16-months of inventory available. On a year to date basis there have been 131 properties sold in the market as compared to 199 for the same period in 2008 which is 34.2% reduction in sales. For the week of March 16th through 22nd, there were nine properties sold which is a slight decrease from the week prior. All but three of the properties sold last week were in the Tahoe Donner area where most of the sales activity is occurring. The North Lake Tahoe areas remain slow. We held nine open houses over the past weekend with a fair amount of activity but nothing significant. There was a snow storm over the weekend which may have further hampered activity. A fair number of Agents reported favorable buyer showings for higher priced properties $900,000 and higher. We had six offers accepted this past week. It is apparent that buyer interest and activity is picking up as there are continued great values in the market. Market comments: Great closings and strong open escrows! Our listings are still slow coming in but lots of agents are working with buyers and not just the low end!

After a week of positive indicators, my best advice is for buyers to get out there. There are some fantastic deals out there right now and as more people begin to realize it, competition will come back and begin to drive activity. You know what they say about the early bird!

Until next time,
Make it a great one,

Bob Bronswick

It Was a Week of Surprises…And Best of All, Spring Has Sprung!

2009-03-19T19:05:00.000-07:00

First, CNNMoney.com reported a sudden, unexpected surge in U.S. housing starts. According to the Commerce Department, housing starts rose to a seasonally adjusted annual rate of 583,000 last month, up 22% from a revised 477,000 in January. The big surprise: Economists were expecting starts to decline to 450,000, according to consensus estimates by Briefing.com.

Furthermore, applications for building permits, considered a reliable sign of future construction activity, rose 3% to a seasonally adjusted annual rate of 547,000 last month. The other big surprise: Economists were expecting permits to fall to 500,000.

Also interesting this week, retail sales figures fell much less than expected in February, and surprisingly strong January sales were revised even higher. According to CNNMoney.com, “U.S. store sales showed a smaller-than-expected decline in February after an unexpected surge in January that was bigger than originally reported…The Commerce Department said total retail sales fell 0.1% last month, compared with January’s revised increase of 1.8%. Economists surveyed by Briefing.com had been expecting a decrease of 0.5% for February.”

So, is it safe to call this a trend? Are we out of the woods yet? It’s tough to say. In all honesty, you don’t know whether or not you’ve hit bottom until you’re on your way back up but it seems some of the critical signs are starting to show signs of life which is welcome relief for our wounded economy.

Also in the news this week, the Federal Reserve announced plans to purchase up to $750 billion in mortgage-backed securities and up to $300 billion in longer term Treasury securities. Our representatives at the National Association of Realtors applauded the plans noting “This is great news for American home buyers and homeowners because mortgage interest rates will continue at historic lows.”

What this means for Americans is that a greater number of home buyers will be able to purchase a home and homeowners facing challenges will be able to refinance into better terms. As NAR noted, “We already are experiencing a great improvement in housing affordability due to historically low interest rates and the Fed’s move will push affordability conditions to the best levels in 40 years. In addition, continued low rates will lessen foreclosure pressure and help stabilize home prices sooner, as more Americans buy homes and draw down inventory.”

Along the lines of mortgage relief, the Treasury Department this week launched a new website for consumers seeking information about the Obama Administration’s Making Home Affordable loan modification and refinancing program. The site, www.MakingHomeAffordable.gov, offers features including interactive self-assessment tools that will empower borrowers to determine if they are eligible to participate and calculate the monthly mortgage payment reductions they could stand to realize under the Making Home Affordable program.

This is a helpful site that we should all be sharing with our friends, families and clients alike.

Finally, on Friday, Jim Gillespie, president and CEO of Coldwell Banker Real Estate LLC, will participate in a discussion about the state of the housing market, live from the New York Stock Exchange on CNBC. This will occur on Friday at approximately 4:30 p.m. (Eastern).

Jim will participate on the “Roadmap to Rebound” segment hosted by Maria Bartiromo. Yale economist Dr. Robert Schiller and Sanjiy Das, CEO of CitiMortgage, will also participate.

In another powerful symbol of what our Coldwell Banker and Realogy leaders are doing on behalf of consumers and the real estate sector in general to enact change that will stimulate housing and ultimately the economy, Jim plans to call upon government leaders to enact a $15,000 non-refundable tax credit to ALL buyers and also a mortgage buy down that would bring rates to the 4-4.5% range. This, NAR reports, could generate an additional 840,000 home sales over 12 months. This home buying activity would have major implications in stimulating the overall US economy since NAR also reports that each home sold generates more than $60,000 in economic activity. The proposal would also have a greater impact on foreclosures than the current stimulus package. I hope you will all watch.

Now, with all of that exciting news for the week in tow, let’s take a look at our local real estate news:

Auburn—Listing inventory and sales inventory is steady out of our Auburn office. We had a few REOs in the area and we are in multiple situations on a couple of the short sales. Listings are sparse and land listings are sitting. Many of the Agents believe that we are going to finish strong in 2009 and that the confidence level is beginning to be a bit more positive.
Dixon-Davis—Our Dixon-Davis office is reporting very slow inventory and very active sales, though prices remain low. If you looked at our inventory in our area you might actually think the market was taking a turn. We’re seeing less inventory and more multiple offers over the list price. Hopefully when the REO listings are released they will come out slow but steady to keep the market from being shocked again.
El Dorado Hills/Placerville—Our inventory in El Dorado Hills and Placerville has stayed about the same this year. El Dorado Hills has 345 listings and we had over 450 the middle of last year. About 10% of our market is REO and 20-25% is short sales. Traffic at open houses has been spotty depending on the weather. We’re seeing occasional multiple offers on homes priced at or below market. We seem to be getting more traffic on floor but overall the market has remained the same all year which is certainly better than the declining market we experienced last year.
Elk Grove/Laguna—What a difference a year makes. Many buyers are still frustrated because most listings are receiving so many offers they are having to write a lot of offers to get one to stick. For the second week in a row, traffic counts remain high. Short sale approvals are occurring at an increasing pace. REO listings have slowed, but there are a lot waiting in the wings. Multiple offers are still common place on properties below $300,000.
Folsom—Open house traffic has been super! One listing, with help of a home builder promotion, drew 40 groups! Our REO inventory is decreasing. Three of our 11 sales for the week were short sales. Overall it was a good, solid week. Everything was working, including floor time, open homes, new home sales, etc. The weekend was very busy with all of the conference rooms tied up most of Saturday.
Rocklin/Lincoln—Inventory is down but, according to some reports, banks reportedly have 700,000 REOs waiting to unload on the market, many in California. High end homes have not seen much movement or activity in the area.
Roseville/Granite Bay—Looking forward to new stimulus and when the next foreclosures will be hitting the market. Spring starts on the 20th and everyone needs to hear our motto: “LOOK FOR OPPORTUNITIES.”
Sacramento Fair Oaks—The local market overall is slower. The inventory is out about three to four months—a lot slower than what we are accustomed to. REOs have been very slow. Our open home traffic has been fairly good. Now with the weather warming up, we expect more.
Sacramento Metro—Our biggest challenge right now is that the banks are holding the REOs which are the majority of our business so once that increases, the inventory will be the same. Experienced, veteran Agents are seeing less activity on traditional listings; we’re seeing some offers fall apart for various reasons. Agents are doing what they can to stay in the game. Activity in the office is more steady than the crazy pace we were previously feeling.
Sacramento Sierra Oaks—Sierra Oaks is our “Steady Eddy” office. Several REO Agents are working steadily, not as crazily as like before. We’re awaiting the bank flooding to open up again (likely April). Multiple offers are the norm; we had 11 Short Sales approved by the banks last Friday. All major players (Bank of America, Wells Fargo, CitiBank, etc.) that want to get the assets off of their books. Open homes that were listed at a good price point had a fair amount of traffic.
Tahoe/Truckee Region—The listing inventory for the Tahoe-Truckee market had a slight increase last week with 1,382 residential properties and 588 lots/land listed for sale. Short sales represent 5% and REOs were 2.6% of the active listings in the market respectively. The majority of the short sales and REOs listed, (86%) are priced below $750,000 which is where the sales activity is most brisk. Based on the current inventory and sales year to date, the market has roughly 17-months of inventory available. There continues to be meaningful price reductions within all price points yielding great buying opportunities for discerning buyers. On a year to date basis there have been 122 properties sold in the market as compared to 177 for the same period in 2008 which is a 31% reduction in sales. For the week of March 9th through 15th, there were 13 properties sold which is a slight increase from the week prior with three being over $750,000. We held eight open houses over the past weekend with a fair amount of activity but nothing significant. One of our open houses on the west shore had eight groups through which was encouraging. A fair number of Agents reported their listings are receiving showings at all price points. Over the weekend we had six walk-ins in the Tahoe City offices and a number of sign calls. The time to buy Lake Tahoe-Truckee real estate couldn’t be better.
Vacaville-Fairfield—This week our market continues to be robust. We are experiencing multiple offers on the majority of our listings. Buyers are in our market place and taking advantage of the low interest rates and the availability of the $8,000 credit. Our Agents are actively seeking out their investor clients, as they see positive signs in the marketplace.

With spring break on the horizon and the warmer, spring weather in the air, look for the first of the garage sales as well as lots of great homes holding open houses! For a schedule of open houses, go to www.OpenHouse.com or www.CaliforniaMoves.com. Spring has sprung!

Until next week,
Make it a great one,

Bob Bronswick

What Will Real Estate’s Big Selling Season Bring?

2009-03-15T21:22:00.000-07:00

With real estate’s traditionally busy Spring selling season right around the corner, what do we expect March-June to do for our market this year? Well as much as I’d love to say that we anticipate a sudden, overwhelming surge in sales and that all of our challenges are behind us, I won’t. What I can say is that we are seeing some bright spots thanks to heightened consumer confidence, following the recent legislation passed by the Obama administration. January and much of February had many buyers sitting on the fence as they awaited the results of the Economic Stimulus Package. The lowering of interest rates, induction and improvement of the home buyer tax credit, reduction in preventable foreclosures and reinstatement of the higher loan limits now have some buyers getting off the fence.

We’re definitely feeling the beginning effects of this, in many markets, with an increase in calls to our branch offices and Agents as well as increased traffic at our open houses.

But will this “interest” translate into closed transactions is the million dollar question.

Though none of us holds a crystal ball, I would say that we’re anticipating a moderate Spring. In markets hardest hit by foreclosures, we still have quite a few distressed properties to weed through before we can begin to work our way up. Our hope is that the recent passing of the foreclosure prevention plan will significantly reduce the number of foreclosures hitting the market over the next several months, and once this takes effect, we should be able to weed through the current inventory and start making our way through to the other side. In all honesty, this could take several months before we really feel its full impact.

For those markets impacted less by foreclosures and more so by Wall Street and the general state of the national and global economy, we’re really facing two main challenges: a lack of quality inventory and buyers who are struggling with whether or not to get off the fence.

Many buyers right now have misgivings about whether or not now is the best time to buy. Many are trying to time the market. My response to this is, it is very difficult to time a market. Just as you can’t time the stock market, you can’t time the real estate market. Real estate needs to be seen as a long term investment. If you plan to stay in your home for two, three or even five years, buying now probably makes good business sense. And that is solely if you are looking at purchasing a home from a business or investment purpose. But as we all know, purchasing a home isn’t just an investment. Home is where we live. Where we raise our families. Where we create memories. Rather than simply trying to time the market, we should be reminded of this fact and instead, focus on choosing the best home in which we can make that “life” happen. Of course, prosperity in real estate is how the majority of Americans have built their wealth in this country and I for one won’t overlook that fact but I do think it is important for all of us to reflect on the fact that beyond being a solid investment, our home is much more than that.

For buyers who are out there and are considering buying right now, if you plan to stay in your home for a long period of time, you probably can’t go wrong purchasing today. Though we anticipate moderate home sales in the near term, buyers are ultimately expected to respond to much improved affordability conditions as well as the $8,000 first-time home buyer tax credit and the market will pick up. It’s just a matter of time. And when it does, that pick up will translate into more competition, less inventory and possibly higher home prices, resulting in less purchasing power for you. Consider my advice: waiting may cost you.

And with that news in tow, let’s take a look at this week in real estate:

Auburn—We are seeing some REO activity but more short sale activity. One short sale contract has already been in the process for six weeks. The agents that showed homes this week stated that it was difficult to find a home in the lower price that wasn’t a short sale as the REOs were going so quickly.
Dixon-Davis—All six of our deals this week are REOs or short sales. Our Agents are busy with multiple buyers who are all prequalified.
Elk Grove-Laguna—Open house traffic and floor call volume took a big jump this past week. We had 14 floor calls on Saturday alone. On the open house side, most experienced near or above open house traffic.
Fair Oaks—Last weekend open houses were very good. We had about seven Agents that did them. Two of our Agents had over 30 people in each of their opens. Sales have been decent considering the REOs have not been released. Multiple offers are still going on. The inventory is low causing more activity. The agents in the office are very positive.
Folsom—Open house activity is very good with our opens averaging about 10 groups. Short sales are dominating right now with four of the seven ratified offers being short sales. We had no REO deals this week. If a property is priced right (especially in the Folsom area) it will sell fairly quickly.
Rocklin-Lincoln—On the REOs that are priced right, they are receiving multiple offers and many Agents have written over a dozen offers for the same client. With some of the REOs we are also being given a document for the buyer to sign that states they are not in counter offers with other properties. The feeling among many of the Agents is that we are going to turn the corner and have a good year.
Roseville-Granite Bay—We continue to see struggles. Buyers are reluctant. The positive is affordability and the tax credit. The unfortunate new is the jobless rate.
Sacramento—Our Sierra Oaks office reports a lot of open house traffic and most sales remain REOs and/or short sales. The inventory for our area is very low right now which is dramatically hindering the number of potential sales.
Vacaville-Fairfield—Our market appears to be strong and is definitely a sellers market under $250,000. We are noticing an unusual amount of cash buyers. In our opinion this is a great sign. We feel that they represent the most conservative bunch and they obviously see opportunity in the market. Our biggest challenge this week has been with the appraisers, they are taking longer than usual and the conventional appraisers are putting more conditions on the appraisal than even FHA or VA.
Tahoe-Truckee—The listing inventory for the Tahoe-Truckee market is holding steady with slightly over 2,000 active listings in the area. Of the active inventory there are 53 REO and 93 short sale properties listed which is less than 8% of the total listings in the market. The majority of the REO and short sale listings, (90%) are priced at less than $750,000. Based on the current inventory and sales year to date the market has roughly 19-months of inventory available. On a year to date basis there have been 105 properties sold in the market as compared to 232 for the same period in 2008 which is 54% reduction in sales. For the week of March 2nd through 9th, there were 11 properties sold with 4 being over $750,000. Buyers are being very selective on the properties they are purchasing and many are in a wait and see mode relative to the current economic landscape. Currently there are 111 properties pending sale in the market of which 19 are either an REO or short sale. To demonstrate the selectivity of the buyers, there are currently 28 properties that are active contingent sales and 26 of those properties are classified as short sales. Open house activity has been hit and miss with very little activity on those properties being held open. Part of this is due to the time of year relative to visitors to the area and part of it is due to the slower real estate activity we are seeing. In summary, there are excellent deals available and many great properties to choose from for interested buyers looking to invest in the Tahoe-Truckee market. We certainly expect that as summer approaches and the economic environment improves that sales activity will become more brisk.

As you can see, we really have a mixed bag. Some markets remain slow while others are seeing huge leaps in sales and contracts.

What I’ll leave you with this week is a reminder that, for buyers, opportunity is knocking this Spring. Buyers need to be aware of today’s advantages—attractive interest rates, increased affordability, sizeable inventory, increased loan limits, $8,000 first time home buyer tax credit and motivated sellers. The stars couldn’t be more perfectly aligned.

For sellers, pricing is key. Homes that are priced well (really well) and show well, are selling. Home that aren’t, sit. Consider this as you prepare your home for market and please, take my and your Agent’s advice, and don’t test the market. Price your home well from the beginning to generate the largest pool of potential buyers.

Until next week,
Make it a great one,

Bob Bronswick

Foreclosure Prevention Plan Guidelines Revealed

2009-03-06T12:01:00.000-08:00

Earlier this week, the Obama administration released the guidelines which enable lenders to begin modifications of eligible mortgages under the administration’s Homeowner Affordability and Stability Plan. Here is a summary of the guidelines, direct from the Department of Treasury: http://www.treas.gov/press/releases/reports/guidelines_summary.pdf.

This “foreclosure prevention plan” (dubbed by the media as such) is estimated to help some seven to nine million homeowners make their mortgages more affordable and help to prevent the continuation of the devastation that foreclosures have caused in this country.

According to the U.S. Department of Treasury, “The Home Affordable Refinance program will be available to 4 to 5 million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac. Normally, these borrowers would be unable to refinance because their homes have lost value, pushing their current loan-to-value ratios above 80%. Under the Home Affordable Refinance program, many of them will now be eligible to refinance their loan to take advantage of today’s lower mortgage rates or to refinance an adjustable-rate mortgage into a more stable mortgage, such as a 30-year fixed rate loan.

“GSE lenders and servicers already have much of the borrower’s information on file, so documentation requirements are not likely to be burdensome. In addition, in some cases an appraisal will not be necessary. This flexibility will make the refinance quicker and less costly for both borrowers and lenders. The Home Affordable Refinance program ends in June 2010.

”The Home Affordable Modification program will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.
With the information now available, servicers can begin immediately to modify eligible mortgages under the Modification program so that at-risk borrowers can better afford their payments.”

Industry online magazine, RISMedia, weighed in on the plan this week and offered this insight that I thought would be helpful: http://rismedia.com/2009-03-04/how-to-help-homeowners-understand-obamas-foreclosure-plan/

I know that many clients have a lot of questions right now and we are working to gather some communication tools to help. One good option in the meantime is a consumer-friendly Q&A recently put together by the Treasury Department, the U.S. Department of Housing and Urban Development (HUD) located at http://www.financialstability.gov/makinghomeaffordable/.

Now, let’s take a look at this week in real estate:

Dixon-Davis—Agents are busy with buyers and short sale listings. “Regular listings” increased over the last few weeks. One of our REO Agents continues to stay busy while others’ inventory is still low. Short sales and REOs continue to get multiple offers. All of our short sales continue to get back up offers while they are waiting on acceptance from the banks.
Elk Grove—We had 12 multiple offers out of our Elk Grove office this week. Much of this is in large part due to REO properties, considering the fact that 85% of our business is short sales or foreclosures. REO and short sale business has dominated for the month. Floor call volume and open house traffic has increased.
Fair Oaks—Our Fair Oaks office shares that listing inventory has increased because of the number of relocation regarding USSA. Sales inventory has decreased and multiple offers have increased. Our local market in Fair Oaks and surrounding areas are fairly active with buyers. It seems like the real sellers are coming out of the woodwork.
Folsom—Our Folsom office reports increased sales activity and steady inventory. Our office doesn’t have any REO listings right now, though we are participating on the sale side with other brokers. We are still slow on the new listings. The average sale price of $350,000 for this week was good. We had one sale over $700,000, one sale over $600,000 and one over $500,000.
Rocklin-Lincoln—Our Rocklin/Lincoln office reports open house activity was slower than usual due to the rain. The largest number of attendees was one open house with 18 visitors. There were five good leads from our open houses this weekend, however, which tells me that the serious buyers are out there, weathering the storms. We had two REO listings and one short sale listing. We also received approval from Wells Fargo for a short sale submitted about 30 days ago that included the first, second and a line of credit. REOs were slow this week but we expect this to change, especially in Lincoln Crossing. We are also getting calls daily with regards to listing short sales.
Roseville-Granite Bay—We saw decreases in inventory this week and overall, activity was slow.
Sacramento—Our Sacramento Metro office reports that we had 10 multiple offers this week—all of which were on REOs. We are seeing good open house activity in the core areas. We are seeing signs that REO activity is slowing and with this new, lack of inventory in our core areas, things are slowing in the Sacrament Metro area. Our Sacramento Sierra Oaks office concurs noting that inventory is very low. Though the wet weekend might’ve kept some buyers away, we are still seeing a lot of action—often multiple offers—on REO properties.
Tahoe-Truckee—We are seeing steady listing inventory and sales activity in our Tahoe-Truckee region. It appears that buyers are in a wait and see mode. There are many buyers who are looking at properties, particularly the short sales and bank owned. However, they are not necessarily writing offers. We’re hoping that the spring will bring closed transactions for those currently looking. We are receiving phone inquiries on short sales of late.

The news of the week is a breath of fresh air for millions of homeowners and for the real estate sector, it is just what the doctor ordered. It is imperative that we continue to move with speed to make housing more affordable and to help stop the spiral in our housing markets. I believe that this plan will encourage additional loan modifications and will ultimately reduce the foreclosure rate. In the end, this is one—and possibly the most important—way to stabilize prices and once again get us moving in the right direction. Helping families keep their homes is critical, both for the health of our economy and in neighborhoods across the country.

What I am most inspired by is the fact that I really do believe that we are headed in the right direction. On a local level, we’re already starting to feel the initial flow of these benefits. Though I can’t say it is across the board, in general, we are seeing increased floor activity, increased open house activity and buyers are finally getting off the fence and inquiring about the first time home buyer credit, increases in conforming loan limits and seeking counsel on whether or not now is the best time to buy.

While I don’t want to sound too much like a Pollyana, I truly believe that we are well-positioned and poised for a recovery. No, it won’t happen overnight but Obama and his team have made it very clear that they can’t fix this economic crisis without fixing the housing woes and with the recent release of the second half of the TARP funds coupled with the Emergency Economic Stabilization Act and now the Homeowner Affordability and Stability Plan, the housing sector truly is in one of the best positions for a recovery.

Until next week,
Make it a great one,

Bob Bronswick