Coldwell Banker 10 Day Sales Event is On!

Coldwell Banker Real Estate LLC is promoting a sales event during which participating sellers who have listed their homes for sale through a company agent will drop their asking price by up to 10 percent.

Borrowing a page from the marketing plans of home builders and auto dealers, the "10-Day Sales Event" will run from Oct. 10 through Oct. 19.

"Our research and discussions with our brokers and sales associates shows that in many markets sellers remain reluctant to list their homes at the proper prices necessary to attract buyers," said Jim Gillespie, Coldwell Banker president and CEO, in a statement.

"It's our hope that the Coldwell Banker 10-Day Sales Event will move buyers off the sidelines and into the market. We are embarking on this initiative -- which has never been done before on a national basis -- because we believe it is critical for Coldwell Banker, as an industry leader, to help serve the needs of those individuals listing homes with a Coldwell Banker broker and to help move the U.S. real estate market in the right direction."

The announcement referenced a company survey of 3,379 Coldwell Banker real estate professionals -- 56 percent of respondents said that the listing prices in their market areas "remain above where they need to be to attract qualified buyers."

article from www.inman.com

Government Bailout of Fannie Mae and Freddie Mac

Here is a link to a report from the Wall St. Journal about how the US Gov't has come to the rescue of Fannie and Freddie. 

http://blogs.wsj.com/developments/2008/09/08/government-bails-out-fannie-mae-and-freddie-mac/

This is good news for home buyers and sellers. Upon this announcement mortgage rates dropped approximately one-half of a percentage point. The effect of this drop in rates will most likely be increased activity and sales resulting in a reduction of housing inventory. 

Important Buyer Information

Here are two short articles from http://www.realtrends.com/ email newsletter that I thought buyers would find useful:

Top economists say housing doom is overblown

(WASHINGTON) – The Washington Post reports that a team of housing economists
believe "predictions of further large housing price declines are greatly
overblown." The Post gathered some of the nation's top
economists to study the housing crisis. They concluded that in reality only four
states – Arizona, California, Florida and Nevada – have had home price declines
of more than 4 percent in the past year. The economists
said the home price index compiled by the Office of Federal Housing Enterprise
Oversight was the most comprehensive of the various
indexes. The Post said, "Our analysis reveals,
unsurprisingly, that foreclosures and home prices have negative effects on each
other over time, but this does not imply a vicious cycle of collapsing prices.
Our models predict that as foreclosures continue to climb in many states, house
prices will remain flat or decline in those states — but will not
collapse.

When to get the biggest discount in a home sale (SEATTLE) -
The online brokerage Redfin has released a study showing when buyers have the
highest opportunity to buy a home at the lowest price. According to Redfin,
heavily discounted homes are: -- 83 percent more likely to have been on the
market for 90-plus days. -- 73 percent more likely to be marketed as
fixer-uppers. -- 20 percent less likely to feature a substantial remodel. -- 28
percent more likely to have already been price-reduced. -- 52 percent more
likely to have been seller-owned for 20 years or more. -- 9 percent more likely
to be a short sale or bank-owned.

What's Going On with the Central Coast Real Estate Market?

Along with the graphs that show the sales trends over the last few years, here is a brief synopsis of what's happening here on the Central Coast and in San Luis Obispo:

For Cayucos

There are currently 61 listings including single family, condos and PUD's. Least expensive is a 648 sq. ft. house for $359,000 and the most expensive is a 697 acre ranch for $6.6 million. The median price is $875,000. There are currently 4 homes in escrow and 22 have sold over the past 6 months with a median selling price of $860,000. The average days on the market is 104.

For Morro Bay

There are currently 131 listings starting at $299,000 for a small condo and going up to $3.7 million for a home on 116 acres. The median price is $649,000. 12 homes are in escrow at this time and 60 have sold in the past 6 months with a median selling price of $522,500. The average days on the market is 119.

For Los Osos

There are currently 73 homes on the market starting at $185,000 for a small condo and going up to $2.7 million for a view home over 5500 sq. ft. Median price is $579,000. 16 homes are in escrow and 55 have sold in the past 6 months with a median selling price of $470,000. The average days on the market is 121.

For San Luis Obispo

There are 230 active listings starting at $282,400 for a small condo and going up to $12 million for a ranch house and 7 rentals on 530 acres of land. Median list price is $624,500. 37 homes are in escrow and 172 have sold in the past 6 months with a median selling price of $571,950. The average days on the market is 86.

More Attractive Rates May Help Buyers

Here is an interesting article from the Wall Street Journal regarding lower interest rates for “jumbo conforming” loans.


http://blogs.wsj.com/developments/2008/06/19/more-attractive-interest-rates-may-help-first-time-buyers/


It seems that these rate changes would really provide a boost to the real estate industry if the deadline to apply for these rates is extended past December 31, 2008.

Current Market Statistics

Here is some statiscal information on the current real estate market for Cayucos and Morro Bay as of today 5/20/08:

Cayucos

• 59 - active listings
• 7 - pending sale
• 18 - sold in the past 6 months
• Average list price - $1,319,207
• Average selling price - $1,276,611
• Average days on the market - 164

Morro Bay

• 119 active listings
• 15 - pending sale
• 47 - sold in the past 6 months
• Average list price -$765,605
• Average selling price - $571,726
• Avereage days on the market - 132

As always, please feel free to call me at 805-471-5568 with any questions.

Seven Simple Reasons to Buy Now

Here are seven simple reasons why this is the best time to buy a home in years.....

Fact #1: Some six million Americans are expected to buy a home this year. Six million people in the game make up a pretty big game. That's a level of sales equal to the one we experienced in 1998 by all accounts, a pretty good year.

Fact #2: There is still over $23 trillion of value in U.S. housing stock. Home ownership continues to be the basis of our wealth in this country.

Fact #3: The housing market cannot help but grow. Our country's tremendous wealth, liquidity, and entrepreneurship will continue to drive our economy. 70-100 million people will be added to our market in the next 40 years.

Fact #4: Real estate is cyclical. The biggest fear in good times is that the fair weather won't last forever because it doesn't. But the reality of a cyclical real estate market also provides its brightest hope in bad times..foul weather won't last forever either. What's happening today is a market correction, severe in some places, but it's not the end of the world. As shown by Fact #1, people are still buying and selling homes. The markets will stabilize.

Fact #5: 2008 is the best year to buy a home in 35 years. 1973 was the last time mortgage rates were this low in a buyer's market. We had rates this low in 2001 and 2002, but those were strong seller's markets with little inventory. The last two big buyer's markets, in the early '80s and early '90s had much higher rates. Low rates and good inventory make 2008 the best year to buy in decades!

Fact #6: First-time buyers have a real advantage in today's market. First-time buyers can buy at a reduced price without having to sell at one too. Higher limits on lower cost conforming loans also help first-time buyers purchase more home for their money. Today's starter‚ homes can be pretty impressive.

Fact #7: First-time buyers lose money while they wait on the sidelines. First, renters typically pay more state and federal income taxes than homeowners with a mortgage deduction. Renters are also losing the wealth they could be accumulating as they pay down their mortgage and as their home increases in value over time (as it surely will). Lastly, renters who wait to buy will lose money if interest rates increase by the time they finally act. Higher payments from higher interest rates represent money buyers could have kept if they had bought earlier. Conversely, if they were willing to spend that amount of money earlier, they could have bought more homes.

The above information was brought to you by Centex Homes.

Scenic Coast Home Sales

Here's another update on the real estate market for Cambria, Cayucos, Morro Bay and Los Osos. I hope it's helpful to see a timeline of sales and what's happening so far this year compared to the last four. If you'd like to know how sales have been going in a specific area of the county or would like to be updated on new listings, please feel free to call me at 805-471-5568.

Zillow Appreciation Values

I found an interesting article from www.realtrends.com with some home value statistics that were compiled by Zillow. As you will see, our market here on the Central Coast would be mostly the upper middle to top categories of price. In looking at the 5 year index, appreciation isn't as bad as it seems. That's the benefit of looking at the "Big Picture" and not just what's happened recently.

According to Zillow, a home's value may affect net gain or loss

While declining values and compressed equity have plagued many U.S. homeowners in recent years, the value of a home relative to others locally may very well
influence how much equity a home lost or gained last year, according to new
analysis by real estate Web site Zillow.com of its Q4 Home Value Report. Zillow
has broken down the U.S. housing market and 125 Metropolitan Statistical Areas
(MSAs) into five value bands - Bottom, Lower Middle, Middle, Upper Middle and
Top - each representing 20 percent of the market, to illustrate how homes of
varying value performed in 2007 and over the last five years.

Value Band Definitions and Change in Value

National / Zindex=$224,890 /1 year change = -3.0%/5-year annualized = 6.9%
Bottom /< $140,999 / 1 year change = -0.7% / 5 year annualized = 10.1% Lower Middle /$141,000 - $211,999 / 1 year change = -5.4% / 5 year annualized = 8.4% Middle / $212,000 - $300,499 / 1 year change = -6.2% / 5 year annualized = 7.3% Upper Middle /$300,500 - $460,499/ 1 year change = -6.5% / 5 year annualized = 6.6% Top / > $460,500 / 1 year change = -7.5% / 5 year annualized = 5.4%

Our Market's About to Change

More buyers are out and about in our area! Our companywide Open House Extravaganza this past weekend was a great success. There are lots of deals to be had, and I believe potential buyers are realizing it. The new conforming loan limits should increase the amount of buyers in this market and have an impact on lowering the inventory, especially because these new limits will only be offered until the end of the year. I understand that these loans should be available starting in April as lenders are trying to figure out the specific requirements for approval. Buyers should be aware that because of all the recent foreclosures, the new loan conditions will be tougher than those in the past. This is a good thing, for both banks and borrowers, however. If the rules were tighter in the past we may not be in this mortgage mess now. I believe that all things happen for a reason, and hopefully we as a society will learn from our mistakes. Even so, the real estate market is a cycle and if you plan to invest, everything is pointing to doing it now. The real question is... will this new plan along with lower interest rates be enough to increase activity in the real estate market and help spur the economy? I am very optimistic about it.

New Loan Limits Released

Here's another update to the increase of loan limits...

According to one local contact, Erica Spellacy with Pacific Capital Mortgage, ericaspellacy@hotmail.com,...

No lenders have acknowledged these increases. FHA may allow it but the lenders have to have the recourses to approve, fund and sell these larger loans before they can move forward.

But here's the good news...

FHA requires only 3% down, allows for more lenient underwriting standards and NO longer requires a termite clearance.

Please read on:

From Inman News
HUD releases new California loan limits
By Matt Carter, Wednesday, March 5, 2008.
HUD released the new FHA loan limits for California today -- the rest of the country will get theirs tomorrow -- and median home price data that allows you to calculate the new conforming loan limit for Freddie Mac and Fannie Mae (it's 125 percent of the median home price, or $417,000, whichever is more, up to a maximum of $729,750).

All told, 14 California counties saw their loan limits for FHA, Fannie and Freddie bumped all the way up to the $729,750 cap. Most were in the San Francisco Bay Area or northern California (Alameda, Contra Costa, Marin, Monterey, Napa, San Francisco, San Mateo, Santa Cruz, Santa Clara) with five more in the L.A. area (Los Angeles, Orange, San Benito, Santa Barbara, and Ventura).

New California loan limits
County /Median price /FHA limit /Conforming loan limit
Alameda County $995,000 $729,750 $729,750
Alpine County $438,000 $547,500 $547,500
Amador County $355,000 $443,750 $443,750
Butte County $320,000 $400,000 $417,000
Calaveras County $370,000 $462,500 $462,500
Colusa County $318,000 $397,500 $417,000
Contra Costa County $995,000 $729,750 $729,750
Del Norte County $249,000 $311,250 $417,000
El Dorado County $464,000 $580,000 $580,000
Fresno County $305,000 $381,250 $417,000
Glenn County $230,000 $287,500 $417,000
Humboldt County $315,000 $393,750 $417,000
Imperial County $260,000 $325,000 $417,000
Inyo County $350,000 $437,500 $437,500
Kern County $295,000 $368,750 $417,000
Kings County $260,000 $325,000 $417,000
Lake County $321,000 $401,250 $417,000
Lassen County $200,000 $271,050 $417,000
Los Angeles County $710,000 $729,750 $729,750
Madera County $340,000 $425,000 $425,000
Marin County $995,000 $729,750 $729,750
Mariposa County $330,000 $412,500 $417,000
Mendocino County $410,000 $512,500 $512,500
Merced County $378,000 $472,500 $472,500
Modoc County $125,000 $271,050 $417,000
Mono County $370,000 $462,500 $462,500
Monterey County $599,000 $729,750 $729,750
Napa County $615,000 $729,750 $729,750
Nevada County $450,000 $562,500 $562,500
Orange County $710,000 $729,750 $729,750
Placer County $464,000 $580,000 $580,000
Plumas County $328,000 $410,000 $417,000
Riverside County $400,000 $500,000 $500,000
Sacramento County $464,000 $580,000 $580,000
San Benito County $790,000 $729,750 $729,750
San Bernardino County$400,000 $500,000 $500,000
San Diego County $558,000 $697,500 $697,500
San Francisco County $995,000 $729,750 $729,750
San Joaquin County $391,000 $488,750 $488,750
San Luis Obispo County$550,000$687,500 $687,500
San Mateo County $995,000 $729,750 $729,750
Santa Barbara County $615,000 $729,750 $729,750
Santa Clara County $790,000 $729,750 $729,750
Santa Cruz County $719,000 $729,750 $729,750
Shasta County $339,000 $423,750 $423,750
Sierra County $228,000 $285,000 $417,000
Siskiyou County $235,000 $293,750 $417,000
Solano County $446,000 $557,500 $557,500
Sonoma County $530,000 $662,500 $662,500
Stanislaus County$339,000 $423,750 $423,750
Sutter County $340,000 $425,000 $425,000
Tehama County $250,000 $312,500 $417,000
Trinity County $200,000 $271,050 $417,000
Tulare County $260,000 $325,000 $417,000
Tuolumne County $350,000 $437,500 $437,500
Ventura County $599,000 $729,750 $729,750
Yolo County $464,000 $580,000 $580,000
Yuba County $340,000 $425,000 $425,000

Source: Department of Housing and Urban Development

A Second Economic Stimulus Package????

This is a really interesting article from RealTrends.com regarding the possibility of a home buyer tax credit to reduce sales inventory and help spur the economy.

Homebuyer tax credit a possible way to reduce inventory

The idea of a second economic stimulus package is getting attention in Washington these days, and this one could have a provision to help more homebuyers. One proposal is to include a tax credit for buyers - a move that could help reduce the large amount of housing inventory currently on the market. A similar plan was put in place to clear out inventory in the 1970s, according to the National Association of Home Builders.

Help for first-time buyers is particularly important, said Lawrence Yun, chief economist for the National Association of REALTORS. More first-time buyers create a chain reaction in the market, allowing more current homeowners to trade up into their next home, he said. A tax credit for first-time buyers could give them a boost in confidence, counteracting their worries of home-price drops to come, he said.

"People will realize that the worst in housing is coming to an end if they see bold measures," Yun said in a telephone interview.

Can legislation actually work to reduce inventory? It has before, according to the NAHB. The group said that in 1975 - another time when inventories were high - a $6,000 home-buyer credit brought in a substantial flock of buyers, enough for builders to get back to business. (MarketWatch)

This is Soooo True......

Ever wonder what's really going on with our economy? Here's a humorous take on what the economists and analysts have to say....

A short concise view of where the economy is headed

After listening to economists and experts conjecture about the direction of the economy, a humorous summary is as follows:

What we have here is a continuing, but slowing, upward drive on the downside - which is better than a downward thrust on the upside, or even a sideways move on a U-shaped trough.

But, as the downside bottoms out, the resulting flat side of the up curve will strengthen any sideways movement still apparent in the recovery.

However, if the overshoot of incline produces a rising, but negative, slowdown in acceleration of the leading indicators, the resulting outflow could mean additional pressure from all sides of a circular demand curve.

taken from Realtrends.com

Update #2 on the Economic Stimulus Plan

Here's an article from the California Association of Realtors (C.A.R.), Newsline, Febuary 13, 2008 regarding the Economic Stimulus Package:

PRESIDENT SIGNS $168 BILLION ECONOMIC STIMULUS BILL
President Bush today signed off on the $168 billion stimulus package approved by Congress last week, which, in addition to tax rebates for millions of working Americans and business owners, includes a vital, but temporary increase in the conforming loan limit. The economic stimulus package will allow the Federal Housing Administration, as well as Fannie Mae and Freddie Mac to offer mortgages above the current conforming loan limit of $417,000 to as much as $729,750 in high-cost areas for loans originated between July 1, 2007 and Dec. 31, 2008.

"The actions of Congress and our president represent a significant victory for homeowners across the state and nationwide," said C.A.R. President William E. Brown. "C.A.R. has long fought for increases to the conforming loan limit in order to close the gap for would-be home buyers in high-cost areas, such as California, and, with the spotlight now fully shining on this important issue, will continue those efforts and push for permanent changes beyond Dec. 31."

To read the president's remarks regarding the signing of this bill, go directly to http://www.whitehouse.gov/news/releases/2008/02/20080213-3.html.

Update on the Economic Stimulus Plan

Here's a quick update on the Economic Stimulus Plan as it pertains to our housing market. Although the senate is still squabbling over the details, congressional insiders are expecting approval. The pending legislation will affect those areas with median home prices above $334,000 and the new limit for jumbo loans will be 25% higher than the median price up to $729,750. The chart shows median home prices for several metro areas including San Luis Obispo County and is taken from the Wall Street Journal, Thursday Feb. 7, 2008, Redefining Jumbo Loans.

Economic Stimulus Plan....Buyers get Ready

Here's an article from the California Association of Realtors, published a couple of weeks ago, that may bring you up to speed on the economic stimulus package that is currently being reviewed by the senate. It has passed in congress and if it's approved by the senate, it will be another great reason for buyers to make their move and decide to purchase. I'll keep you updated on if/when it passes.

Increasing conforming loan limits part of stimulus package

The U.S. House of Representatives unanimously approved a measure Tuesday that includes an increase in the conforming loan limits as part of a larger economic stimulus package. The measure would allow the Federal Housing Administration and Fannie Mae and Freddie Mac to issue mortgages above the current $417,000 level. Raising the conforming loan limits to more accurately reflect the cost of housing in California and other high-costs areas of the nation has long been an objective of C.A.R.

“While this measure is expected to face an uphill battle in the Senate, Tuesday’s action by the House represents a huge win for Californians and for C.A.R., which has fought aggressively for the increases for several years,” said C.A.R. President William E. Brown.

“For years, Chairman Barney Frank and I have worked to create affordable housing opportunities for families across the country by increasing the FHA and GSE conforming loan limits,” said Congressman Gary G. Miller, who has worked closely with C.A.R. to push for the reforms. “With the average home price in high-cost areas like California exceeding the current loan limit, homeowners and homebuyers in these areas have been unable to utilize these important federal housing programs. The loan limit increases included in the economic stimulus package will make safe, conforming mortgage loans available for homebuyers in all areas of the country.”

Currently, Californians are forced into more expensive non-conforming jumbo loans, decreasing homeownership opportunities for many and forcing others into more costly – and often riskier – loan products. Under terms of the proposed stimulus package, the conforming loan limit will be raised from $417,000 to as high as $729,750 in high-cost areas. The increases would only be valid through the end of the year.

While the House is hoping to send the measure to President Bush for signature by Feb. 15, the Senate is reported to be crafting a stimulus package of its own, including add-ons, which may result in delays. In addition, the Office of Federal Housing Enterprise Oversight (OFHEO) continues to oppose conforming loan limits reforms.

The House’s economic stimulus package also includes $500 million to support foreclosure mitigation counseling agencies across the country, many of which are currently short-staffed and overwhelmed by the rise in defaults.

Taken from www.car.org

It's About Time!

Well, I figured since I haven't written in over a month, it's about time I update this blog. I apologize to any of my readers for the delay. Regarding my last post, I thought you may want to know that we sold our house. What a big relief for us, especially in this slower market. I can only imagine, (and feel empathy for) what many sellers across the country are going through right now, not to mention those who are losing their homes. Fortunately for us, the market in our area has not taken as bad a beating as the rest of the country. And, we found some wonderful buyers who were well qualified, love the house, and will be great neighbors. (The house we moved to is just around the corner.) Anyway, needless to say, with moving, the holidays and a short vacation, I've neglected this blog. I will try and keep posting more regularly, however. In the meantime, here is another great picture of how the real estate market progressed in 2007, and how many homes were sold this year, compared to the previous three years. The first graph is for the Scenic Coast: Cayucos, Morro Bay, and Los Osos, and the second graph represents all of San Luis Obispo County. As always, please feel free to contact me anytime with questions. I'd love to hear your comments as well. By the way, if you are thinking about buying, the feds just lowered interest rates again yesterday. It's about time those of you who are sitting on the fence, take advantage of these low rates and low prices!