SAN JOSE, Calif. (KGO) -- Here's the best news you've heard in years about Bay Area real estate. A new report offers not just a glimmer of hope in California's housing market, but predicts a roaring comeback over the next six years. We could be poised for a dramatic comeback.
ABC7 spoke with the California director of the Economic Forecast and he's predicating a rise in home prices is going to be the convergence of a number of factors. He is suggesting that more jobs, fewer distressed properties, and those historic low interest rates will all play a role in this turnaround.
The same panel of economists who warned the California housing bubble was going to burst is now predicting homes prices are ready to rebound.
"I am absolute thrilled that we are finally coming out with something positive," said Cherie Colon from Windermere Real Estate.
UCLA economists are predicting a steady climb in the median price of existing California homes. The UCLA Anderson Forecast anticipates an 11.5 percent price jump next year. The forecast calls for another 10 percent increase in 2013 and a median price of nearly $440,000 by 2017 -- that would represent a 52 and a half percent increase over today's prices.
Mike Sibilia is president of the Santa Clara County Association of Realtors. He said, "52 percent by 2017 for median price, that is aggressive, but we've seen it before, and what I like is the steady growth is what I like to see."
The National Bureau of Economic Recovery says the recession ended in June 2009, but the foreclosure crisis and high unemployment have weighed heavily on any recovery.
Now, Jean Haneke is seeing signs of life. She's looking to sell her home in Morgan Hill.
"There are houses that are closing in our area, there are good sales, we've seen statistics on it, and we're looking for that sort of thing as a seller," said Haneke.
Foreclosures still count for about one third of all home sales in California and bay Area prices are especially zip code driven, but the UCLA Anderson Forecast suggests as a whole, home prices have hit bottom.
"I think locally we have already seen the start of it in some markets, but also don't expect it all to come because there are still the statistics that show that we're probably not going to be at 2006 levels again for 10 years or more," said Colon.
While the UCLA economist predict double-digit increases in terms of home prices, they say that home sales will remain relatively flat, bouncing in the 3 to 5 percent range, with the most sales activity taking place between 2013 and 2015.
(Copyright ©2011 KGO-TV/DT. All Rights Reserved.)
Wednesday, November 23, 2011
Friday, November 18, 2011
13,780 Homes Sold Yesterday
To all those who have declared the real estate market dead, we want you to know that over 13,780 houses sold yesterday, 13,780 will sell today and 13,780 will sell tomorrow.
That is the average number of homes that sell each and every day in this country according to the National Association of Realtors’ (NAR) latest Existing Home Sales Report. NAR reported that sales had increased 7.7% over the month before and 18.6% over the year before. According to the report, annualized sales now stand at 5.03 million. Divide that number by 365 (days in a year) and we can see that, on average, well over 13,000 homes sell every day.
We realize that these numbers are below the record for homes sold in 2006. We also know that we may never see those numbers again (and that is probably a good thing). But to say that the current real estate market is dead or that houses are not selling is totally inaccurate.
That is the average number of homes that sell each and every day in this country according to the National Association of Realtors’ (NAR) latest Existing Home Sales Report. NAR reported that sales had increased 7.7% over the month before and 18.6% over the year before. According to the report, annualized sales now stand at 5.03 million. Divide that number by 365 (days in a year) and we can see that, on average, well over 13,000 homes sell every day.
We realize that these numbers are below the record for homes sold in 2006. We also know that we may never see those numbers again (and that is probably a good thing). But to say that the current real estate market is dead or that houses are not selling is totally inaccurate.
Tuesday, November 15, 2011
It's the time to buy now!
Ok, I know many of us have been saying this for some time now, but when the news media starts saying it – well, I guess that makes people stand up and take notice. A number of recent articles in the national press are now saying that it might be the right time for consumers, who have largely been on the sidelines, to jump back into the housing market.
I understand why potential buyers, whether first-timers or move-up buyers, remain cautious given all the economic headwinds and bad news out there. Economic growth has been slow, the jobless rate too high, and don’t even get me started about the politics in Washington, the euro-zone debt problems and the challenges facing Greece.
But I often urge buyers to examine what I like to call your “personal economy.” That is, if you have a steady job, reasonable credit, and enough savings for a solid down payment, you might want to take a deep breath and think about taking the leap into the housing market while prices and interest rates are so low.
Read what two of the nation’s top business publications, Fortune magazine and The Wall Street Journal, are telling their readers:
“Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.”
- “Real estate: It’s time to buy again,” Fortune Magazine article by Shawn Tully.
“Two key measures now suggest it's an excellent time to buy a house, either to live in for the long term or for investment income.”
- “It’s Time to Buy that House,” The Wall Street Journal article by Jack Hough.
Tully in the Fortune piece interviewed Mike Castleman, founder and CEO of Metrostudy, who has spent more than 30 years tracking data on the inventory of new homes in the United States. Each quarter, inspectors go through 45,000 subdivisions from California to Maryland. According to Fortune, inspectors examine 5 million lots and record whether they contain a house under construction or completed.
What has Castleman observed? The glut of new homes that the U.S. had a few years ago at the peak of the market has rapidly disappeared. Instead, he told Tully that he has seen a rapidly declining inventory that could force prices higher. In the 41 cities Metrostudy looked at, there are just 78,000 houses vacant and for sale, or under construction – less than a quarter 343,000 units at the height of the market in 2006 and less than the total a decade ago.
"The talking heads who are down on real estate will hate to hear this, but America needs to build a lot more houses,” Fortune quoted Castleman as saying. “And in most markets the price of new homes is fixin' to rise, not fall."
Metrostudy collects figures on the number of homes that are vacant and for sale in each city, and the number of months it takes to sell all them to determine whether individual markets have a surplus or a shortage of homes. "If we had anything like normal levels of buying, those houses would sell in 2½ months," Castleman told Fortune. "We'd see an incredible shortage. And that's where we're heading."
Fortune says that consumers may be confused by conflicting news reports on the housing market, and that could be impacting their confidence in buying a home. On one hand, housing affordability has never been better. But on the other hand, they continue to see housing starts falling and home prices still heading down in some markets.
Tully said economists Robert Shiller and Karl Case, authors of the S&P/Case-Shiller Home Price indices, have different views about where we ware in the cycle. While Shiller remains pessimistic, Case is more optimistic that things are starting to turn around, telling Fortune that "the lack of new home building is a huge help that a lot of people are ignoring.”
In its analysis of the housing market, Fortune noted that it’s important to look at the economic fundamentals of home ownership to see where the market is headed. As home prices rose sharply over the past decade, Tully said the magazine warned that a bubble was forming due to the level of new construction and the cost of owning a home compared to renting one.
“Eventually reality set in, and prices plummeted,” Tully said. “Our current view focuses on those same fundamentals — only now they're pointing in the opposite direction,” Fortune noted. “So let's state it simply and forcibly: Housing is back.”
The Fortune article said what will drive the recovery of the housing market is a sharp drop in new home construction, as noted in the Metrostudy research, as well as a big drop in home prices. Home prices have fallen about 30% nationwide since 2006, Fortune said, and more than 50 percent in hardest hit markets. With unusually high affordability levels, the article noted, Americans will start returning to the market.
While no one can predict with certainty the future of home prices and sales volume, it is safe to say that a turnaround will eventually happen. Timing the market is very difficult because you will never know the absolute bottom until prices have started going back up again. My advice is to look closely at your own “personal economy” and talk with a professional Realtor to see if now might be a good time for you to take advantage of low prices and rates, and join others in taking the plunge into buying a home.
CALL ME TODAY AND LET'S TALK REAL ESTATE 408 676 9657
I understand why potential buyers, whether first-timers or move-up buyers, remain cautious given all the economic headwinds and bad news out there. Economic growth has been slow, the jobless rate too high, and don’t even get me started about the politics in Washington, the euro-zone debt problems and the challenges facing Greece.
But I often urge buyers to examine what I like to call your “personal economy.” That is, if you have a steady job, reasonable credit, and enough savings for a solid down payment, you might want to take a deep breath and think about taking the leap into the housing market while prices and interest rates are so low.
Read what two of the nation’s top business publications, Fortune magazine and The Wall Street Journal, are telling their readers:
“Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.”
- “Real estate: It’s time to buy again,” Fortune Magazine article by Shawn Tully.
“Two key measures now suggest it's an excellent time to buy a house, either to live in for the long term or for investment income.”
- “It’s Time to Buy that House,” The Wall Street Journal article by Jack Hough.
Tully in the Fortune piece interviewed Mike Castleman, founder and CEO of Metrostudy, who has spent more than 30 years tracking data on the inventory of new homes in the United States. Each quarter, inspectors go through 45,000 subdivisions from California to Maryland. According to Fortune, inspectors examine 5 million lots and record whether they contain a house under construction or completed.
What has Castleman observed? The glut of new homes that the U.S. had a few years ago at the peak of the market has rapidly disappeared. Instead, he told Tully that he has seen a rapidly declining inventory that could force prices higher. In the 41 cities Metrostudy looked at, there are just 78,000 houses vacant and for sale, or under construction – less than a quarter 343,000 units at the height of the market in 2006 and less than the total a decade ago.
"The talking heads who are down on real estate will hate to hear this, but America needs to build a lot more houses,” Fortune quoted Castleman as saying. “And in most markets the price of new homes is fixin' to rise, not fall."
Metrostudy collects figures on the number of homes that are vacant and for sale in each city, and the number of months it takes to sell all them to determine whether individual markets have a surplus or a shortage of homes. "If we had anything like normal levels of buying, those houses would sell in 2½ months," Castleman told Fortune. "We'd see an incredible shortage. And that's where we're heading."
Fortune says that consumers may be confused by conflicting news reports on the housing market, and that could be impacting their confidence in buying a home. On one hand, housing affordability has never been better. But on the other hand, they continue to see housing starts falling and home prices still heading down in some markets.
Tully said economists Robert Shiller and Karl Case, authors of the S&P/Case-Shiller Home Price indices, have different views about where we ware in the cycle. While Shiller remains pessimistic, Case is more optimistic that things are starting to turn around, telling Fortune that "the lack of new home building is a huge help that a lot of people are ignoring.”
In its analysis of the housing market, Fortune noted that it’s important to look at the economic fundamentals of home ownership to see where the market is headed. As home prices rose sharply over the past decade, Tully said the magazine warned that a bubble was forming due to the level of new construction and the cost of owning a home compared to renting one.
“Eventually reality set in, and prices plummeted,” Tully said. “Our current view focuses on those same fundamentals — only now they're pointing in the opposite direction,” Fortune noted. “So let's state it simply and forcibly: Housing is back.”
The Fortune article said what will drive the recovery of the housing market is a sharp drop in new home construction, as noted in the Metrostudy research, as well as a big drop in home prices. Home prices have fallen about 30% nationwide since 2006, Fortune said, and more than 50 percent in hardest hit markets. With unusually high affordability levels, the article noted, Americans will start returning to the market.
While no one can predict with certainty the future of home prices and sales volume, it is safe to say that a turnaround will eventually happen. Timing the market is very difficult because you will never know the absolute bottom until prices have started going back up again. My advice is to look closely at your own “personal economy” and talk with a professional Realtor to see if now might be a good time for you to take advantage of low prices and rates, and join others in taking the plunge into buying a home.
CALL ME TODAY AND LET'S TALK REAL ESTATE 408 676 9657
Tuesday, November 1, 2011
60 Days till 2012!!
Hope you all had a safe and fun Halloween yesterday!
Happy 1-11-11
This means that you have 60 days to become a new homeowner or to become a 1st time homeowner before 2012.
Call me today and let's talk about how I can help you with your most important asset.
408 67 My MLS (69657)
Happy 1-11-11
This means that you have 60 days to become a new homeowner or to become a 1st time homeowner before 2012.
Call me today and let's talk about how I can help you with your most important asset.
408 67 My MLS (69657)
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