Mark Your Calendars, the First MEBA MeetUp is Thursday March 4th

Hi there!

This Thursday (the 4th) a few of us are going to get together and dig a little deeper into a few different topics & then do some socializing. The format will be loosely based upon Open Space principles & we’re calling it the first official MEBA Meetup. If you’re reading this and want to participate, we’d love to have you.

When : Thursday March 4th from 6-8pm.
Where : 900 Colusa Ave #206 in Berkeley (Cross St. Solano)

Hope to see you on Thursday.

Residential Delinquency Rate Takes a Dip in Q4 2009

The latest release from the Mortgage Bankers Association, contained a bit of good news in that the delinquency rate for mortgage loans on 1-4 unit residential properties fell 17 basis points to a seasonally adjusted rate of 9.47 percent.

Some other notable bites from the release…

• The percentage of loans on which foreclosure actions were started during the fourth quarter was 1.20 percent, down 22 basis points from last quarter and up 12 basis points from one year ago.
• The percentages of loans 90 days or more past due and loans in foreclosure set new record highs. The percentage of loans 30 days past due is still below the record set in the second quarter of 1985.
• 30-day delinquencies actually fell by 16 basis points from 3.79 percent to 3.63 percent. Only three times before in the history of the MBA survey has the non-seasonally adjusted 30-day delinquency rate dropped between the third and fourth quarter and never by this magnitude. This drop is important because 30-day delinquencies have historically been a leading indicator of serious delinquencies and foreclosures.
• The pattern of mortgage delinquencies now very much follows the pattern of unemployment. Just as short-term delinquencies have fallen during the latter part of 2009, first-time claims for unemployment insurance have declined by about a third since their peak in March 2009.

My takeaway: We still have a record amount of loans in foreclosure, but the leading indicators are beginning to brighten up a bit.

Glen's Numbers Gets a Mention in the SF Chronicle

I send copies of Glen’s Numbers, the local real estate stats that I compile each month to key individuals within the San Francisco Bay Area Real Estate Industry, including Carolyn Said of the San Francisco Chronicle.

I was quoted in her latest article, “Market Stabilizes, but Volatility Lurks” published in the Business Section of last Sunday’s newspaper.

After a period where it seemed that steep discounts were the only way to sell a home, real estate agents say they’re seeing signs of a sellers’ market as low interest rates, a home buyers tax credit, and increased affordability bring buyers out of the woodwork.

“It’s simple,” said Glen Bell of Keller Williams Realty in the East Bay. “You’ve got less inventory and a lot more buyers. We’re getting multiple offers because there are lots of buyers competing for fewer properties.”

Bell tracks home statistics in 38 cities in Alameda and Contra Costa counties. At year end, those towns collectively had 1.7 months’ worth of inventory, compared with 5.9 months’ worth in late 2008. Oakland, for instance, had 1.8 months of inventory at year end compared with 7.8 months a year earlier. Richmond had 1.4 months compared to 8.7 months.

While a year ago, foreclosure sales dominated, banks now are selling far fewer repossessed homes. That causes both tighter inventory and higher median prices, because foreclosures tend to be at bargain prices.

“There is a big backlog of delinquencies,” Bell said. “For nine months, we’ve kept hearing that we’ll see more (foreclosures) on the market, but we’ve just seen a trickle.”

Of course, if you’re a regular reader, or on the MEBA list you’d probably already know that… but it’s always nice to see your name in print.

Good Housing News from NAR & RealtyTrac, but is a Slowdown on the Horizon

The NAR released their 4th Quarter Housing Statistics today and showed increased sales & year over year price gains in many metro areas.

Lawrence Yun , NAR chief economist, said the first-time home buyer tax credit was the dominant factor. “The surge in home sales was driven by buyers responding strongly to the tax credit combined with record low mortgage interest rates,” he said. “With inventory levels trending down over the past 18 months, we expect broadly balanced housing market conditions in much of the country by late spring with more areas showing higher prices.”

Existing-home sales in the West jumped 16.2 percent in the fourth quarter to an annual rate of 1.38 million and are 18.2 percent above a year ago. The median existing single-family home price in the West was $227,200 in the fourth quarter, which is 8.9 percent below the fourth quarter of 2008, but with many areas showing notable gains.

“Markets in the West such as San Francisco, San Jose and Denver are showing double-digit price increases, and other markets like San Diego and Anaheim have begun to firm up,” Yun said.

In other good news, RealtyTrac’s January 2010 Foreclosure report shows a 10% decline in foreclosure activity nationwide.

“January foreclosure numbers are exhibiting a pattern very similar to a  year ago: a double-digit percentage jump in December foreclosure activity  followed by a 10 percent drop in January,” said James J. Saccacio, chief  executive officer of RealtyTrac  “If history repeats itself we will see a surge in the numbers over the next few  months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works.”

While the news is good, I’m guessing it will be temporary as the home buyer tax credit expires, the Fed’s program to buy mortgage backed securities ends & the banks foreclosure activity picks up after a seasonal holiday slowdown.

It’s going to be an interesting spring for the housing market.

Glen’s East Bay Housing Numbers: January 2010

I’m including something new for this month; two graphs that cover pending sales, active listings and the pending/active ratio over a three year period, (2007 through 2009). Although we saw changes on a month by month basis, we didn’t realize how dramatic this was  until we plotted the numbers over the long run.

As you can see our inventory was at its peak in 2007 at over 13,000 active listings. The low point was last month in December at 3,690. This is at the lowest level since I began tracking 38 cities back in May of 2005.  Pendings have climbed due to the increase in buyers and the prolonged escrow periods. With increased competition for fewer properties, we’re beginning to see prices in some areas sell, on average, over asking and slowly creep up. Months supply dropped to 1.7 months over all.

January numbers brought an interesting surprise. We actually saw an increase in inventory, something we haven’t seen in quite some time. We expect a spike in January after the holidays, but this was an unexpected jump of 16 to 17%, unusually high. Although we expected this to be due to increased REOs coming onto the market, it wasn’t. The percentage of REO listings actually dropped from 23% to 19%, while short sales remained stable. The months supply increased from 1.7 months to 2 months. Although this could be signaling that we’re bottoming out in some areas, it’s still too early to determine that this is an actual trend. It’ll be interesting to see what the coming months bring.

You can download PDFs of my January 2010 numbers here.

–Glen