Silicon Valley home sales dip in August; fewer bargains on the market – San Jose Mercury News
The other day a Burbed commenter wrote this:
Valley’s uptick eclipses state: As California faces long, slow recovery, local economy poised for quick rebound with tech help – San Jose Mercury News | SF Bay Area Home Price and Mortgage Insanity Blog – Burbed.com
mike Says:
September 16th, 2009 at 4:04 pmI hate the Merc.
It’s always rah rah bull; almost worse than realtards.
Ouch!
Well how about this then!
Silicon Valley home sales dip in August; fewer bargains on the market – San Jose Mercury News
For the first time since January, both the number of homes sold in Santa Clara County and their median price fell from the previous month, a surprising reversal in a housing market that had been steadily climbing out of the burst real estate bubble.Home sales plunged 21 percent in August from July, a sharper drop than in any other Bay Area county, and the median price dropped to $515,000, a 5 percent decline from July and down 13 percent from August last year, according to a report Thursday from MDA DataQuick.
The numbers appear to reflect just how fragile the market is, with real estate professionals and analysts offering a number of varying reasons for the month-to-month changes, from fewer foreclosed properties listed for sale, to new rules that have resulted in longer escrows, to higher mortgage rates.
“Part of the midsummer pause in the market could have been caused by home shoppers becoming frustrated by market conditions they didn’t anticipate,” John Walsh, MDA DataQuick president, said in a statement released with the report, citing fewer cheap foreclosures and the high number of all-cash deals and multiple bids. “It might have driven some back to the sidelines,” he said.
The nine-county Bay Area saw the median price of previously owned single-family houses fall 8 percent from July, to $375,000.
…
“It’s not unusual to get 10 offers” on “reasonably” priced foreclosure properties, said Judi Seip, an agent with Coldwell Banker in Cupertino.
Some are intentionally underpriced, other agents said, which sometimes means 20 or 30 bidders make offers.
One of Seip’s clients recently offered about $16,000 more than the asking price on a home priced about $440,000, and had a 50 percent down payment, but still lost the house to another bidder. Seip said she’s working with several buyers who hope to find homes and close escrow by Nov. 30, which is the deadline to purchase a home and receive a credit of as much as $8,000 on federal taxes, an element of the economic stimulus plan. “What happens in December is anybody’s guess,” she said.
See? It’s not always rah rah news. But there’s no need to despair… it’s clear that the reason for this is that interest in houses have simply taken a nap. There’s so much hot startup activity right now (and look! facebook is break even!) that people don’t have time to shop around for houses.
Come this spring… back to July 2007 prices! You heard it here first!
September 21st, 2009 at 8:48 am
Very timely article. Pralay was in complete disbelief when I told him a fews back that the market is willing to pay more than what the banks are asking:
“It’s not unusual to get 10 offers” on “reasonably” priced foreclosure properties, said Judi Seip, an agent with Coldwell Banker in Cupertino.
Some are intentionally underpriced, other agents said, which sometimes means 20 or 30 bidders make offers.
One of Seip’s clients recently offered about $16,000 more than the asking price on a home priced about $440,000, and had a 50 percent down payment, but still lost the house to another bidder.
September 21st, 2009 at 9:31 am
I better believe an agent from Coldwell Banker.
September 21st, 2009 at 9:32 am
RE,
I think you are missing the point of the article. The point is that yes- there was an uptick in sales, but only because there was a flood of foreclosures on the market. In the meantime much of the non-foreclosed homes have been ignored because the reality is that the price of the foreclosures is the max that most people can actually pay given new rules and financing options.
Thus if its any indicator of whats to come it is that current “prime” pieces of real estate are still overpriced and will likely start trending down to price levels that are inline with current foreclosures.
I have no doubt that real estate can sell. But this is a story of the very telling of the dollar amount people are willing to spend on a house.
September 21st, 2009 at 9:41 am
Back to 2007 price is not acceptable as RBA home prices should go up by at least 10% per annum. By spring home prices should be 2007 peak + 30% to make up for disgusting 3 year gap. And this should make Santa Clara county as probably the first county with median home price >$1mn. Does any such county exist in USA with median >$1mn?
September 21st, 2009 at 9:46 am
Knife catchers will do the damndest things!
September 21st, 2009 at 10:51 am
And what effect will our unemployment rate have on all of this? California just hit 12.2%!!
http://money.cnn.com/2009/09/18/news/economy/state_unemployment/index.htm?postversion=2009091815
Can anyone say “double dip”?
September 21st, 2009 at 11:17 am
Look out below: SFGate: $30 billion home loan time bomb set for 2010
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2009/09/20/MNOR19N2B1.DTL#ixzz0RlXSfhxU
September 21st, 2009 at 1:49 pm
Here’s some fresh fodder for our perennial bull:
James Grant argues the latest gloomy forecasts ignore an important lesson of history: The deeper the slump, the zippier the recovery.
http://online.wsj.com/article/SB10001424052970204518504574420811475582956.html
And a look back on the 10th anniversary of the book called DOW 36,000:
http://online.wsj.com/article/SB125339416443425433.html
September 21st, 2009 at 1:49 pm
My landlord’s next door neighbor is trying to do a short sale. They bought in 2008 and they’re asking $290K less than they paid.
September 21st, 2009 at 1:56 pm
any idea what kind of loan they had? It’s remarkable that they would already be in default unless the owner lost his job.
September 21st, 2009 at 2:56 pm
No idea. The Property Shark history doesn’t show a loan, but it doesn’t a show a loan on the house I’m renting either, and I know they have a loan.
April 16th, 2010 at 8:22 pm
no need to despair… it’s clear that the reason for this is that interest in houses have simply taken a nap.