East Bay Housing Data – Glen’s Numbers through December 2011
January 9, 2012 by Glen Bell · View Comments
Well, 2012 is officially here & I just finished compiling the lastest batch of Glen’s East Bay Housing Numbers… here they are.
The December numbers
- 2011 comes to a close on the verge of what appears to be a market in transition. Inventory of homes for sale have dropped for the 8th consecutive month bringing us to the lowest levels since December of 2009.
- The month’s supply for the combined 38 city area that I track is now 1.9 months, far below normal, and again reaching lows we haven’t seen since December of 2009.
- Our Pending/Active Ratio has increased again to 1.54, normally considered in a seller’s market range. Keep in mind that this number is overstated due to the large number of short sales that remain in pending status for longer periods than normal.
- Distressed properties, (REOs and Short Sales), are still a large part of our local markets. 54% of the active listings, 78% of our pending sales (primarily due to the large number of short sales – 61%), and 52% of the sales over the last 4 months are distressed properties.
Some Comments on “What’s this All Mean?”
I asked this question a couple of months ago; “With lower home prices and record low interest rates, why aren’t more people buying now?”
Well, in a sense they are. It really comes to where and in what price range. We’re seeing an increase in activity at the lower priced home market levels in many areas where the focus is with first time home buyers and investors. Increased demand coupled with lower inventory is beginning to place an upward pressure on prices. We’re beginning to see an increase in multiple offers. For both counties combined (Alameda & Contra Costa), 51.2% of sales over the past 4 months fall into this lower end price range (below $300,000).
The mid price levels ($300,000 to $750,000) continue to be sluggish primarily due to a lack “move-up” buyers who have experienced a loss of equity in their own homes, plus the uncertainty of the economy, including job concerns and the difficulty in obtaining a loan.
The pending and active graphs, attached, seem to be following a similar pattern that we saw happen during 2009 and at the beginning half of 2010. Inventory levels reached their low point in December 2009 before rebounding the beginning of 2010. If early indications hold up, we may see inventory pick up again at the start of the year, followed by an increase in pendings, and in the months supply. The beginning of 2010 experienced a slight seller’s market. Will history repeats itself?
Other Recent News
Bay Area Home Prices Low, Sales Creep Up December 14, 2011 – DQNews
Bay Area home sales were ahead of 2010 for the fifth month in a row in November, despite limited mortgage availability and sluggish high-end sales. The median sale price fell again on a year-over-year basis, partly because of the slowdown in sales above the mid point for prices, a real estate information service reported.
“These days, buyers and sellers have to contend with two sets of problems, which sometimes play into each other and sometimes conflict with each other. The first is the lousy economy and the opportunities it presents, for better or worse. The second is the dysfunctional mortgage finance system. Interest rates may be at record lows, but the types of mortgages that are available have been drastically reduced and qualifying is a true grind,” said John Walsh, DataQuick president.
“This creates uncertainty. Many potential buyers and sellers appear to be in a frame of mind that says, ‘when in doubt, don’t,’” he said.
Bay Area home prices expected to stabilize in 2012
After years of decline, housing prices are expected to stabilize or even increase in some parts of the Bay Area this year, according to a new forecast.
Stabilizing prices are a sign of a healthier market, even though homebuyers still face challenges — tight credit, not many homes for sale and competition from investors paying cash.
In a report to be released Monday, Clear Capital, a real estate valuations company in Truckee, predicts that prices will remain almost flat this year — compared with a 4.7 percent drop in 2011 — in the San Francisco-Oakland-Fremont metropolitan area, including Contra Costa County.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glens Numbers through December 2011 here .
East Bay Housing Data – Glen’s Numbers through October 2011
November 14, 2011 by Glen Bell · View Comments
The Pending/active ratio; this once reliable market indicator is now signaling that we are in a sellers’ market.
But, it doesn’t feel like we’re in a Sellers’ market
Inventory has gradually decreased since April, (down 19.2% compared to a 37% increase over the same period of time last year). Month’s supply is now only 2.7 months. We haven’t seen inventory this low since April of 2010. Lower inventory usually means more competition favoring sellers.
However, we’re seeing homes stay on the market longer, sell for under asking, more transactions falling out, many price reductions or homes that are simply being withdrawn from the market.
With lower home prices and record low interest rates, why aren’t more people buying now?
1) The loss of equity for many home owners have kept many from “moving up” into the mid level priced homes.
2) The continued turbulent economic news has scared many buyers back onto the fence, with concerns that things will only get worse or that their own jobs may be in jeopardy. They are waiting for the “uncertainty” in the markets to go away before committing to making one of the most important decisions of their life, buying a new home.
3) Over 60% of the market now consists of first time home buyers and/or investors looking for bargains primarily focused on the lower end of the market, (homes that are selling for $300,000 and below).
4) 57% of pending sales in the area are now short sales. This has skewed the numbers because they have longer escrows and many transactions never close. Taking this into consideration, the pending active ratio is misleading and should actually be adjusted down.
5) There’s a larger fall out of transactions due to the difficulty of first time home buyers getting their loans.
6) Of the few remaining buyers left, many are feeling that they will stay in their next home longer, passing on the smaller homes for something larger and in a more “move in” condition.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through October 2011 here.
KRON4 News Interviews Glen for Bay Area Housing Segment
October 20, 2011 by Andy Kaufman · View Comments
MEBA team member (and resident housing analyst) Glen Bell was recently featured in a piece that KRON4 news did on the Bay Area housing market. Its always an adventure to see what makes it into the finished piece, but I think it came out pretty well.
To recap Glen’s points:
- Sellers aren’t getting the prices that they were getting several years ago & everybody is reluctant to take less.
- We’re looking at another 3-5 years where local housing markets are going to be relatively flat.
- Still, with prices coming down as far as they have, combined with historically low interest rates, it makes for one of the best buying opportunities that we’ve seen in a long time.
East Bay Housing Data – Glen’s Numbers through September 2011
October 13, 2011 by Glen Bell · View Comments
The latest East Bay housing numbers are in & for the fifth month in a row we’ve seen another slight decrease in inventory, a 12.5% drop since the end of April. This isn’t typical because we’re usually just starting to back off about this time of year. We saw nearly a 38.4% increase last year during the same period.
The months supply for the combined 38 city area that I track is now 2.9 months, slightly below normal.
Our Pending/Active Ratio has increased again slightly to 1.08, again slowly returning towards a “normal” market range. Keep in mind that this number is overstated due to the large number of short sales that remain in pending status for longer periods than normal.
Distressed properties, (REOs and Short Sales), are still a large part of our local markets. Although this is slowly becoming less of a factor with listings. 47% of the active listings, 74% of our pending sales (primarily due to the large number of short sales – 57%), and 49% of the sales over the last 4 months are distressed properties.
Other Recent News
Here are a few points that stood out to me from C.A.R.’s California Housing Market Forecast for 2012
Good fundamentals, but still dependent on the consumer & jobs.
“Despite the run of unforeseen global events in the first half of this year that slowed the overall economy, 2011 home sales are projected to essentially remain unchanged from last year,” said C.A.R. President Beth L. Peerce. “Looking ahead, the fundamentals of the housing market – such as low mortgage rates, high housing affordability, and favorable home prices – are expected to continue, but at this point, a strong housing recovery will depend on consumer confidence, job creation, and the availability and cost of home loans.”
Improved mix.
“Discretionary sellers will play a larger role in next year’s housing market,” said Peerce. “Those who held off selling in 2011 may list their homes in 2012, thereby improving the mix of homes for sale compared with the last few years. Additionally, distressed sales will remain an important segment of the overall market as lenders continue to work through the foreclosure process.”
Another transition year.
“2012 will be another transition year for the California housing market, as the continued uncertainty about the U.S. financial system, job growth, and the stability of the overall economy remain in the forefront for all market participants,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “An improvement in job growth, consumer spending, and corresponding gains in housing are essential to a broader recovery in the economy, but would-be buyers will remain cautious as they weigh these myriad uncertainties against the clear opportunities presented by today’s very affordable housing market.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through September 2011 here.
East Bay Housing Data – Glen’s Numbers through August 2011
September 14, 2011 by Glen Bell · View Comments
The August numbers are in and for the fourth month in a row we’ve seen another slight decrease in inventory, a 9% drop since the end of April. This isn’t typical because we’re usually just starting to back off about this time of year.
We saw nearly a 32% increase last year during the same period. The months supply for the combined 38 city area that I track is now 3 months, slightly below normal.
Our Pending/Active Ratio has increased slightly to 1.06, again slowly returning towards a “normal” market range. Keep in mind that this number is overstated due to the large number of short sales that remain in pending status for longer periods than normal.
Distressed properties, (REOs and Short Sales), are still a large part of our local markets. Although this is slowly becoming less of a factor with listings. 47% of the active listings, 73% of our pending sales (primarily due to the large number of short sales – 56%), and 49% of the sales over the last 4 months are distressed properties.
From Around the Web…
Last month’s sales fell harder in the higher price ranges: The number of $500,000-plus homes sold dropped 25.4 percent month-to-month and 19.2 percent year-over-year.
“There’s certainly a lot more discretionary buying in the higher price ranges,” said John Walsh, DataQuick president. “A lot of those buyers have the option to just take it or leave it and, lately, it looks like more have been leaving it. There was a lot of uncertainty out there over the economy, home prices and the nation’s future. And that was before the stock market turbulence hit in early August.”
– DQNews: Bay Area Housing Market Takes a Breather
“Home buying will be conservative in the months ahead until we get a sense of which direction this economy is heading,” said Robert Dye, chief economist at Comerica Inc. in Dallas, who forecast a decline for July. “No one wants to buy into a soft housing market. We’ve seen prices remain soft in many areas.”
– Existing home sales unexpectedly dropped in July – Alex Kowalski, Bloomberg News
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through August 2011 here.
East Bay Housing Data – Glen’s Numbers through June 2011
July 8, 2011 by Glen Bell · View Comments
The latest East Bay Housing numbers are in and for the second month in a row we’ve seen a slight decrease in inventory, 4.6% since the end of April. This isn’t typical because we’re usually picking up steam this time of year. We saw nearly a 14% increase last year. The months supply for the combined 38 city area that I track is now 3.3 months.
Our Pending/Active Ratio has increased slightly to .99, slowly returning towards a “normal” market range. Again, keep in mind that this number is overstated due to the large number of short sales that remain in pending status for longer periods than normal.
Distressed properties, (REOs and Short Sales), are still a large part of our local markets. Although this is slowly becoming less of a factor with listings. 45% of the active listings, 68% of our pending sales and 52% of the sales over the last 4 months are distressed properties.
Other Recent Housing News
A MacroMarkets survey of over 100 economists, investment strategists, and housing market analysts regarding their 5-year expectations for future home prices in the United States showed that…
“A significant majority of our panelists believe that the bottom for home prices arrived in the first quarter or will arrive sometime before year-end (2011). Despite persistent macroeconomic uncertainty and unprecedented housing market dysfunction, almost two-thirds of the panelists see the U.S. residential real estate market as at an historic turning point,” Robert Shiller said in a statement.
Price Expectations Survey, compiled from 108 responses of a diverse group of economists, real estate. “69 panelists who are currently forecasting a 2011 turning point predict less than two percent average annual growth in nominal home prices over the five-year period ending December 2015.”
If we really are close to a true bottom in home prices, that this combined with the continued low interest rates makes for a favorable buying environment.
From Reality Check: It’s a homebuyer’s market
“You’re seeing more and more markets across the country right now where the cost to acquire and own property financially simply makes more sense than renting,” says Budge Huskey, president and chief operating officer of Coldwell Banker Real Estate.
Huskey says buyers need to focus on their local market conditions instead of reacting to what they read about nationally.
We know there is a pent up demand from buyers simply looking for the right time, he says: “They’re trying to time what they consider to be the bottom of the market, which we know is almost impossible to do.”
If you’re looking to buy do your homework, consult a banker, and look only at homes you can comfortably afford. If it’s your first, remember it doesn’t need to be your dream home. Buying a starter, building equity, and trading up remains a good strategy.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through June 2011 here.
East Bay Housing Data – Glen’s Numbers through May 2011
June 6, 2011 by Glen Bell · View Comments
The latest East Bay Housing Numbers are in, and surprisingly we saw a slight drop (1.7%) in overall inventory. This is the first reduction in the number of homes listed for sale since November of 2010 and slightly surprising considering that we’re entering peak summer home buying season.
Distressed properties, (REOs and Short Sales), are still a large part of our local markets. Although this is slowly becoming less of a factor with listings. 47% of the active listings, 70% of our pending sales and 56% of the sales over the last 4 months are distressed properties.
The Pending/Active Ratio, which we use to gauge general market strength, has increased slightly to .97. Trending to towards a balanced market (1.00). Keep in mind that there are a large number of short sales that remain in pending status for longer periods than normal, this keeps the pending count higher, and in turn skews the ratio to the upside. With that in mind, we would consider East Bay Housing to be in a slight buyer’s market.
Recent News
For all of those following the recent stories circulating about the latest Case-Shiller findings on the housing market, showing a nationwide double dip in housing prices, but I believe the news from Altos research may be closer to the truth.
Many experts have been predicting a U-Shaped recovery. Last year we saw a false bottom. Now, we hear that we might be in a Catfish Recovery.
A Catfish Recovery?
“[Altos Research VP Scott] Sambucci laid it out by describing the catfish as a bottom dweller that moves slowly, feeding off the lake or river floor for a while, then heads up to the surface and back down, bobbing up and down without a distinct pattern or clear direction.”
“Altos says markets should plan for prices over the long term to hit a bottom, rise a bit, sink back down, rise again.”
- via Double Dip: Altos Says Prices Have Been Steadily Rising Since Then
Yes, we’ve been saying for several months now that we were seeing further reductions in values for the SF Bay Area. However, we have been seeing different scenarios depending on what area you focused on and at what price level, once again proving that the real story is being told at the micro-market level.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through May 2011 here.
If you’re looking for more news throughout the month, check out the MyEastBayAgent Twitter feed for the latest links.
Looking Closer into the East Bay REO & Short Sale Market
May 23, 2011 by Glen Bell · View Comments
When I was compiling my latest set of East Bay Housing Numbers, I decided to take a closer look at the distressed property market and chart the sales since the beginning of 2007.
The graphs consist of all sales on a month by month basis for both Contra Costa and Alameda Counties. It also shows what portion of sales were distressed property (both REO and Short Sales) since the beginning of 2007 to current April 2011 numbers.
The influence of distressed properties reached their peak during the first quarter of 2009, consisting of 72% to 76% of all sales in Alameda County, and 81% to 83% of all sales in Contra Costa County.
While the number of REO sales has since declined to its current levels, (48% in Contra Costa County and 55% in Alameda County), the number of short sales have gradually increased, now almost as much of a factor on sales as REOs.
East Bay Housing Data – Glen’s Numbers through April 2011
May 8, 2011 by Glen Bell · View Comments
The latest East Bay Housing Numbers are in, and again we’re seeing a slight increase in both inventory levels and in pendings compared to March. Inventory is up 11.4% and pendings are up 20.7% since the beginning of the year.
The months supply is now 3.5 months, above the 3.1 months at the beginning of the year and well above the 2.6 month supply we saw last year at this time.
Our Pending/Active Ratio has increased slightly to .92, slowly returning towards a “normal” market.
Distressed properties, (REOs and Short Sales), are still a large part of our local markets making up 60% of the active listings, 77% of our pending sales and 49% of the sales over the last 4 months.
As always, I’m available if you want to talk about the market, or explore your options for buying, selling or investing in East Bay real estate. You can reach me directly at 510.333.4460.
You can download an entire copy of Glen’s East Bay Housing Numbers Through April 2011 here.
Other News from Around the Web
“Housing Values: The Perfect Storm,” 4/26/2011 – DSNews
“With all the news of still-declining home prices, most buyers are keeping their feet firmly planted on the sidelines unless they’re sure they’re getting a bargain.” – Carrie Bay
Sales up, Prices Down for Bay Area Housing Market, April 14, 2011 – DQNews
“Bay Area home sales last month logged the best March in four years, barely, as prices slipped back a notch. A variety of indicators – including investor and cash purchase levels and adjustable-rate loan use – pointed toward a more normal market, though suggested that it’s still a ways off, a real estate information service reported. “
“The housing market has certainly moved well back from the abyss of two years ago, but there is quite a ways to go before it’s even remotely normal. The Bay Area has much less of a foreclosure problem than the rest of the state, but by its own standards it’s still a sizeable problem that acts as a drag on prices. The big issue continues to be mortgage financing, which is still problematic for many potential borrowers,” said John Walsh, DataQuick president.
“California Mortgage Defaults Drop Again; Foreclosures up,” April 19, 2011 – DQNews
California’s priciest zip codes collectively saw mortgage defaults buck the market-wide trend again and rise slightly quarter-to-quarter, while their defaults fell less on a year-over-year basis than in the overall market. The state’s 80 zip codes with median sale prices of $800,000 or more last quarter posted a 5.8 percent quarter-to-quarter increase in default notices and a 4.7 percent year-over-year decline.
At the other end of the price spectrum, zips with medians below $200,000 saw first-quarter defaults drop 5.5 percent from the prior quarter and drop 17.7 percent from a year ago.
If you’re looking for more news throughout the month, check out the MyEastBayAgent Twitter feed for the latest links.
Taking a Closer Look Into the East Bay Condo Market Slowdown
April 13, 2011 by Glen Bell · View Comments
We are seeing a slowdown in the condo market and I decided to run some numbers to verify what I’ve been hearing.
Below is a chart showing the median price of condo/townhouses in selected cities on a quarterly basis over the past two years, (ending March 31, 2011).
Some are more obvious than others, but values have come down in the last two or three quarters. I expect that trend to continue. Keep in mind there are seasonal influences and there have been some ups and downs over the past couple of years in terms of inventory, demand and values.
The biggest influences with condos in this market are the difficulty in getting a loan based on the condo certifications, declining values, and high HOA dues. Many are being purchased now all cash. However, some investors have stayed away because prices have still not come down enough to cash flow, and many times that is because of the HOA dues.
Carolyn Said highlighted this in her recent article in the San Francisco Chronicle
“In a vicious cycle, lending restrictions bar potential buyers from getting a mortgage in complexes where too many units are behind in homeowner association dues, are not owner occupied or are concentrated in one party’s hands. Units is such complexes must sell for all cash, which drives down their price.”
Eve Mitchell highlights another problem for the condo market in her recent Contra Costa Times article
“In a housing market in which prices continue to be battered by foreclosures and short sales, many would-be buyers of condominiums in the Bay Area instead have found bargain-priced single-family houses as the price gap between the two housing choices closes.”
In summary, the deteriorating HOA financial situations along with the tightening loan requirements & the sudden viability of single family alternatives, have resulted in a East Bay condo market that is struggling to find it’s footing right now.
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