Real Estate in the Bay Area 2009

Hello all & Happy Friday,

In continued display that the President-elect will hit the ground running when he takes office in just four days, Obama met with Congress on Tuesday to ensure he’ll have more than a trillion dollars at his disposal within weeks of his inauguration to begin rebuilding our ailing economy. Just two days later (on Thursday), the President-elect secured access to the second half of the $700 billion financial rescue package after the Senate voted 52-42 against a measure that would have blocked the funds’ release—many members of the Senate felt the Bush administration wasted the first half and were concerned that the Obama administration may do the same.
The President-elect says he hopes to have the ability to tap into a portion of that money within days of becoming President. His plans with the money as well as a stimulus package he hopes to see lawmakers approve, shortly, include:
Creating more than three million jobs, many of them in construction and manufacturing
A focus on helping homeowners avoid foreclosures
Stimulate housing investment and help current homeowners
Provide needed liquidity to commercial mortgage markets to ensure that financing is available
Work more to help people get student loans and car loans
Make sure that the taxpayers’ money didn’t go to high salaries or bonuses for Wall Street executives
Requirement of continues reports on earning, repayments and lending practices from institutions that receive bailout funds
Obama’s economic aids assure that the incoming administration will be responsible with its spending of the Troubled Asset Relief Program (TARP) funds and pledged to commit some $50 billion to $100 billion to address foreclosures.
As we well know, one of the biggest challenges currently affecting our market is the difficulty of even the most qualified buyer to secure financing. The goal of TARP is to open the housing and financial system so buyers—especially those with good credit—are able to once again secure financing.
Several weeks ago in my Real Estate message I made reference to the fact that real estate was in probably one of the best positions—industry wise—for a correction. This is thanks to the fact that lawmakers realize that because housing makes up 20% of the GDP, our economy cannot be fixed without fixing the housing sector. With Obama’s recent outreach to Congress and the TARP funds now available, we’re starting to see the first in what I believe to be several outreach efforts to fix the hard hit housing industry.
Now don’t be fooled. This won’t happen overnight. We’ve got a long road ahead and depending on what forecast you are reading, some say we’ll start seeing a turnaround in mid-2009 and others say we may not see it until 2010, but the good news is that we are on track and our country is finally moving in the right direction.
Now, on that positive note, let’s take a look at this week in real estate:
San Francisco—Our Lakeside and Noriega offices agree that activity hasn’t picked up substantially since the holidays. Is it possible some San Franciscans are waiting until after Obama takes office to begin actively searching? On the flip side, our Market Street office reports that Agents are still remarking about the great traffic at their open houses over the weekend. They believe real buyers are showing up but they are just holding off on pulling the trigger. Our Van Ness office notes that we are seeing better activity in the last 10 days in all price ranges.
Santa Cruz County—January seems to be starting out slow in general. There were a few new sales for the month although we are closing quite a few from November to December. Open houses have been well attended the last two weeks. Our Agents in Santa Cruz are fairly optimistic about 2009.
Silicon Valley—According to our Cupertino Stevens Creek office, the first week of 2009 showed an increase in listings and sale pending transactions. It’s hard to know if this is the start of a trend or just coming off the cooler holiday months. This of course will be a market we’ll continue to watch over the days and weeks ahead. Our San Jose Almaden office notes that buyers are beginning to pick up and activity at open houses is improving. This market continues to be driven by REOs and short sales. Our San Jose Willow Glen office concurs noting that floor call volume has picked up as have our open house traffic.
South County—Our Hollister office is reporting that REO inventory is decreasing and short sale listings are on the rise. Our Morgan Hill office notes that open houses are well attended. There seems to be a lot of interest and potential buyers are realizing that there has never been a better time to buy.
Overall, we are seeing a variance in the market—depending on the region. There is still the public perception that the market is not good, but buyers and sellers alike that they should focus less on what the media is saying and more on their desire to purchase or sell their home. One important note to consider, especially, is that most media outlets are reporting on national and/or regional data and as we well know, real estate, like politics, is very local. Every community and neighborhood is different and relying on regional and/or national data—often which is outdated by at least six weeks—may be a big mistake especially as we grow closer to a real estate turnaround. Remember, now is a great time to buy—but that won’t last forever!
Let me know how I can be of help to you or your friends, family and co-workers regarding their real estate needs. I am always here for you!

Have a great weekend!
Monica

Monica Manocha Re, CMRS * http://www.monicamanocha.com/ * 408 399 1495
221 Los Gatos Saratoga Rd * Los Gatos * CA * 95030

Monica Manocha Re, CMRS
The Malcolm & Manocha Group
Direct: (408) 399-1495Fax: (408) 354-5991Email: monica.manocha@cbnorcal.comWebsite: http://www.mmgproperties.com