Kim Connor
SEPTEMBER/OCTOBER 2012
Intero Real Estate Services 12900 Saratoga Ave. Saratoga, CA 95070 (408) 807-1541 (408) 366-3001 kconnor@interorealestate.com http://www.KimConnorBetterLiving.com DRE #01735816
Inside This Issue
> LOCAL MARKET TRENDS ..................... 1 > MORTGAGE RATE OUTLOOK ............... 2 > HOME STATISTICS .............................. 2 > FORECLOSURE STATS ........................ 3 > CONDO STATISTICS ............................ 3 > HOME SALES & PENDING CHART ........ 4
The Real Estate Report local market trends Trends at a Glance
(Single-family Homes) Aug 12 Jul 12 Aug 11 Median Price: $ 675,000 $ 695,000 $ 590,000 Av erage Price: $ 860,478 $ 915,087 $ 758,205 Home Sales: 1,026 1,027 1,079 Pending Sales: 1,577 1,710 1,626 Inv entory : 1,194 1,273 1,819 Sale/List Price Ratio: 101.8% 102.1% 99.3% Day s on Market: 32 36 51 Day s of Inv entory : 35 37 51
SANTA CLARA COUNTY
This Market is Going Nowhere Although prices have been rising nicely since the beginning of the year, most of this is due to high end homes being bid up by the insta-aires from the recent IPOs.
As part of this deal, state attorneys general gave up the right to sue the mortgage servicers for foreclosure abuses arising out of the robosigning scandal. However, they reserve the right to sue -- or press charges for criminal behavior -The bottom end of the market is being squeezed by if they uncover improper acts when the loans were investors out-bidding home-buying families, and originated or when they were securitized. the middle of the market is going nowhere because When will the new rules and bank policies be they are still underwater. put into place? Most of them have already The market will continue in this vein for at least the become part of bank policies. next couple of years, unless we see some drastic When will homeowners find out if they're principal reductions. eligible for a principal reduction or refinancing? The recent court case against the big five lenders: The banks have said they expect to get started Bank of America, Wells Fargo, Chase, Citigroup very quickly. The first step will be to identify and Ally Financial, requiring them to provide borrowers who qualify for the deal. principal reductions, may quick start the market. What should I do if I think I may qualify for a principal reduction or refinanced mortgage? Contact your lender/servicer and ask them to review your case. If I take the money, what rights do I give up? Individual borrowers do not give up any right to sue.
AUGUST MARKET STATISTICS
sales price to list price ratio has been over 100% for the past six months. The average price for homes was up 13.5% yearover-year. The average price has been higher than the year before for the past ten months in a row. Pending home sales turned around for the first time since last November and were down 3% .
SALES MOMENTUM… for homes dropped 2.3 points to +2.
PRICING MOMENTUM…
has been on the up-swing the past seven months. Sales of single-family, re-sale homes took a dip last It gained 1.2 points to +2. month, dropping 4.9% year-over-year. Home inventory was off 34.4% from last August.
WE CALCULATE…
momentum by using a 12-month moving average The median price for homes rose 14.4% year-over- to eliminate seasonality. By comparing this year’s year. This pushed the sales price to list price ratio 12-month moving average to last year’s, we get a to 101.8%. The median price has been higher than percentage showing market momentum. the year before for the past seven months. The
CONDO STATISTICS…
The median price for condos jumped 41.7% year-over-year and is now at its highest price since July 2008.
Santa Clara County Homes: Sales Momentum 60.0 40.0
Condo inventory was down 79.6% from last July.
20.0 0.0
0 F MA M J J A SO N D 0 F MA M J J A SO N D 1 F MA M J J A SO N D 1 F MA M J J A SO N D 1 F MA M J J A 9 0 1 2 -20.0 8 -40.0
This is an extraordinarily tough market for buyers. It’s important to be calm and realistic. If you don’t know what to do or where to begin, give me a call and let’s discuss your situation and your options.
-60.0 Sales
Pendings
Median
© 2012 rereport.com
Kim Connor | kconnor@interorealestate.com | (408) 807-1541
The Real Estate Report
Mortgage Rate Outlook Sep 7, 2012 -- Although the collective tenor of the eco-
Mortgage rates retreated again this week, taking back another bit of the mild August rise. HSH.com's broad-market mortgage tracker -- our weekly Fixed-Rate Mortgage Indicator (FRMI) -found that the overall average rate for 30-year fixedrate mortgages declined by another three basis points (0.03%) to 3.86%. The FRMI's 15-year companion also decreased by three basis points, sliding to 3.14% and matching its record low. Important to homebuyers and low-equity-stake refinancers, FHAbacked 30-year mortgages eased back down to 3.46%, while the overall average rate for 5/1 Hybrid ARMs finished the weekly survey at 2.74%, down three hundredths of a percentage point from last week, establishing a new record low. 4.0%
5.0%
6.0%
7.0%
8.0%
The chart above shows the National monthly average for 30-year fixed rate mortgages as compiled by HSH.com. The average includes mortgages of all sizes, including conforming, "expanded conforming," and jumbo.
There was a little fall off in construction spending in July. After being driven upward solely by residential spending over the past few months, homebuilding
paused. The overall effect was to cause a 0.9% decline in outlays for construction projects, but residential (-1.6%), commercial (-0.9%) and public (-0.4%) all eased during the month. Although softer compared to June, all the components were measurably higher compared to a year ago, and the new home market has record-thin inventory levels, so some pickup after this pause seems likely. As noted here last week, low interest rates have no doubt helped the economy find some footing, but there is a question of how much additional benefit can be had by the Fed lowering record lows for rates. Low rates on their own are useful, but not a cure-all, and valuable only to those looking to borrow money. A business won't borrow to expand its operations and hire more people in a highly uncertain climate such as this; however, they will try to refinance existing debt and pocket the improvement in cash flow. We also have already had a lot of mortgage refinancing, with at least some unsated demand yet to go, but as with the above, there are limits. There are also plenty of consumer rates seemingly immune to the Fed's machinations, including credit cards and more, so the full benefit of lower interest rates becomes muted for many.
Santa Clara County Homes - Prices & Sales (3-month moving average—prices in $000's) Median & Average Prices
07-12 04-12 01-12 10-11 07-11 04-11 01-11 10-10 07-10 04-10 01-10 10-09 07-09 04-09 01-09 10-08 07-08 04-08 01-08 10-07 07-07 04-07 01-07 10-06 07-06 04-06 01-06 3.0%
nomic data released this week was fair, it was capped by a disappointing employment report for August. At a time of global economic troubles beyond its direct influence, and with the U.S. economy holding onto modest growth, how compelled is the Federal Reserve to make a substantial move?
$1,100 $1,000 $900 $800 $700 $600 $500 $400 $300 $200 $100
1,300 1,100 900 700 500 300 0 FMAMJ JASOND0 FMAMJ JASOND1 FMAMJ JASOND1 FMAMJ JASOND1 FMAMJ JA 8 9 0 1 2
100
Single-family Hom e Sales
30-Year Fixed Mortgage Rates
Santa Clara County - August 2012 Single-Family Homes
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Cities County Campbell Cupertino Gilroy Los Altos Los Altos Hills Los Gatos Milpitas Monte Sereno Morgan Hill Mountain View Palo Alto San Jose Santa Clara Saratoga Sunny v ale
Prices Median Average Sales Pend Inven $ 675,000 $ 860,478 1,026 1,577 1,194 $ 672,450 $ 695,749 38 32 20 $ 1,206,500 $ 1,158,780 36 26 34 $ 419,950 $ 457,812 48 105 54 $ 1,910,000 $ 2,084,660 35 21 42 $ 3,335,000 $ 3,286,090 10 10 51 $ 1,311,000 $ 1,514,980 30 42 90 $ 605,000 $ 715,424 21 62 30 $ 1,550,000 $ 1,902,500 3 3 11 $ 533,500 $ 586,448 40 98 83 $ 969,500 $ 1,104,040 24 25 20 $ 1,710,000 $ 1,928,360 41 28 38 $ 580,000 $ 636,686 541 933 487 $ 638,000 $ 667,231 53 70 45 $ 1,715,000 $ 1,598,560 28 29 95 $ 902,500 $ 877,099 62 69 31
% Change from Year Before DOI 35 16 28 34 36 153 90 43 110 62 25 28 27 25 102 15
SP/LP 101.8% 102.1% 104.0% 99.5% 106.0% 94.1% 96.7% 103.0% 98.9% 99.8% 104.4% 104.3% 101.8% 102.3% 99.4% 103.7%
Prices Med Ave 43.3% 13.5% 0.4% 1.9% -0.1% -10.4% 3.6% 2.6% 15.8% 20.7% 36.1% 24.9% -6.0% -0.3% 10.0% 25.1% -6.7% 14.6% 1.6% -3.7% -2.7% 6.3% 23.9% 24.7% 16.0% 13.9% 10.0% 8.2% 6.0% -3.3% 15.2% 11.2%
Sales -4.9% 72.7% 56.5% 4.3% 29.6% -9.1% -6.3% -36.4% 200.0% -21.6% 9.1% -8.9% 0.2% 6.0% -3.4% 29.2%
Pend2 -3.0% -17.9% -3.7% -27.1% -22.2% 100.0% -2.3% 8.8% -25.0% -2.0% -13.8% -15.2% -22.6% -29.3% 7.4% -5.5%
Inven -34.4% -68.3% -57.0% -59.1% -10.6% 27.5% -21.1% -49.2% -8.3% -37.6% -23.1% -17.4% -55.7% -48.9% -22.8% -64.0%
Santa Clara County Homes: Year-Over-Year Median Price Change 40.0% 30.0% 20.0% 10.0% 0.0% -10.0% -20.0%
0 F MA M J J A SO ND 0 F MA M J J A SO N D1 F MA M J J A SO ND1 F MA M J J A SO ND 1 F MA M J J A 8 9 0 1 2
-30.0% -40.0% -50.0%
© 2012 rereport.com
FORECLOSURE STATISTICS Notices of default, the first step in the foreclosure process, in Santa Clara County fell 5% in July from June, and they were down 10.1% from July 2011. Notices of sale, which set the date and time of an auction, and serve as the homeowner's final notice before sale, were up 12.5% compared to June, but were down 30% year-over-year. After the filing of a Notice of Trustee Sale, there are three possible outcomes. First, the sale can be cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements. Alternatively, if the property is taken to sale, the bank will place the opening bid. If a third party, typically an investor, bids more than the bank's opening bid, the
property will be sold to the third party; if not, it will go back to the bank. In July, cancellations were off 23.8% year-over-year, and flat compared to June. Properties going back to the bank jumped 29.4% in July from June. Year-over-year, they were down 73.2%. The total number of properties that have had a notice of default filed decreased by 26% year-over-year. The total number of properties scheduled for sale declined by 19.6% year-over-year. The total number of properties owned by banks was down 47.3% year-over-year to about 1,054.
Santa Clara County Condos- Prices & Sales $600 $550 $500 $450 $400 $350 $300 $250 $200 $150 $100
450
Table Definitions _______________
400 350 300 250 200
0 FMAMJ JA SOND0 FMAMJ JA SOND1 FMAMJ JA SOND1 FMAMJ JA SOND1 FMAMJ JA 8 9 0 1 2
Condo Sales
Median & Average Prices
(3-month moving average—prices in $000's)
Median Price The price at which 50% of prices were higher and 50%were lower.
150
Average Price
100
Add all prices and divide by the number of sales.
SP/LP
Santa Clara County - August 2012 Condos/Townhomes Cities County Campbell Cupertino Gilroy Los Altos Los Gatos Milpitas Morgan Hill Mountain View Palo Alto San Jose Santa Clara Saratoga Sunny v ale
$ $ $ $ $ $ $ $ $ $ $ $ $ $
Prices Median Average Sales Pend Inven 425,000 $ 473,904 364 660 222 399,500 $ 455,188 16 16 5 728,000 $ 752,500 13 11 3 210,250 $ 210,250 2 11 5 858,000 $ 858,000 2 2 4 612,500 $ 626,083 12 14 18 355,000 $ 363,885 13 43 4 362,475 $ 362,475 2 15 3 653,500 $ 629,805 26 36 7 909,444 $ 927,494 18 18 13 335,500 $ 371,246 182 404 132 425,000 $ 448,287 36 36 17 845,000 $ 895,500 6 8 2 511,000 $ 505,080 36 46 9
% Change from Year Before DOI 18 9 7 75 60 45 9 45 8 22 22 14 10 8
SP/LP 103.1% 102.2% 102.8% 97.9% 102.1% 100.1% 107.2% 97.8% 105.3% 102.8% 102.5% 105.1% 101.5% 103.4%
Prices Med Ave 41.7% 30.6% 28.9% 28.6% 24.4% 9.8% 31.4% 28.2% -4.1% -7.6% -6.8% 13.6% 57.8% 36.4% 62.5% 57.5% 12.7% 20.3% 32.3% 35.5% 31.6% 25.5% 44.1% 43.5% -9.1% -3.7% 4.3% 11.7%
Sales -12.1% 45.5% 85.7% -50.0% -66.7% 71.4% -48.0% -80.0% -16.1% 0.0% -11.7% -2.7% 200.0% 56.5%
Pend2 -21.1% -30.4% 10.0% 22.2% 100.0% -30.0% 38.7% -11.8% -26.5% 38.5% -30.1% -43.8% 300.0% -24.6%
Inven -79.6% -86.5% -84.2% 400.0% -63.6% -56.1% -78.9% -81.3% -84.4% -31.6% -70.1% -54.1% -75.0% -76.9%
Sales price to list price ratio or the price paid for the property divided by the asking price.
DOI Days of Inventory, or how many days it would take to sell all the property for sale at the current rate of sales.
Pend Property under contract to sell that hasn’t closed escrow.
Inven Number of properties actively for sale as of the last day of the month.
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THE REAL ESTATE REPORT Santa Clara County Kim Connor Intero Real Estate Services 12900 Saratoga Ave. Saratoga, CA 95070 (408) 807-1541 (408) 366-3001 kconnor@interorealestate.com http://www.KimConnorBetterLiving.com
Santa Clara County Homes: Pending & Existing Home Sales (3-month moving average) 3,000 2,500 2,000 1,500 1,000 500 0 0 FMAMJ JA SOND0 FMAMJ JA SOND0 FMAMJ JA SOND1 FMAMJ JA SOND1 FMAMJ JA SOND1 FMAMJ JA 7 8 9 0 1 2 Sales
Pending
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