Tag Archive for: realestatetrends

The Housing Market is on the Move…

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Back in March of this year, we provided a report that shows where housing inventory was on the Peninsula, South Bay and Santa Cruz area. This month we have updated this report for your review.

As you may know housing inventory locally or abroad considers several factors that include:

  • Interest rates…(See below for current rates)*
  • Lending Guidelines (Ability to Qualify for Financing)
  • The Economy (Locally and Nationally)
  • Cost of Living (Up in the last 3 to 4 years)
  • Infrastructure of the Area**
  • The Stock Market with Dow pushing over 40k
  • Job Growth
  • Inflation down to 2.97

*Interest Rates are finally dropping.  If you were to purchase a property to occupy and put 25% down and had a 740 mid fico or higher, you may qualify for the following:

  • 30 yar fixed at 6.875% at 0 Points
  • 10 year ARM at 6.625% at 0 Points
Note: APR on 30 year is 7.03 and 6.72 on 10 year Arm. Rates subject to change.
**Infrastructure for these purposes is defined as the abundance of land and buildable space, population in the area, number of large, mid and small cap sized companies local to one area and support services (schools, hospitals)

Housing Inventory is as Follows…

Santa Clara County as of July 12, 2024:

Active Listings – 1028 Houses – priced from $32,800,000 (same property as in March) to $444,000.   614 Condo/Townhome – priced from $2,849,000 to $290,000 (Listings are up by 429)

Contingent Properties – 84 Houses – priced from $16,000,000 (same as in March–these Buyers are waiting for entitlements for the land) to $799,950
65 Condo/Townhome – priced from $1,988,888 to $399,000

Pending Properties – 644 Houses – priced from $11,555,000 to $520,000 and 253 Condo/Townhome – priced from $3,388,000 to $429,000

DAYS ON MARKET – AVERAGES House – 29 and Condo/Townhomes – 38

Summary: Inventory up by 429 properties

In March of 2024, Santa Clara County was at 1213 listings (801 homes, 282 condos and 130 townhomes) and pending sales of 900 (603 in homes and 297 in condos and townhomes.

Provided by:
Dawn Thomas – Broker Associate and Founder
The Dawn Thomas Team
650-215-5990 c   Dawn@siliconvalleyandbeyond.com
DRE# 01460529

San Mateo County as of July 12, 2024:

Houses –

518 Active, 35 Contingent, 255 Pending, 12 transactions fell through, 110 price reductions, 88 Average Days on Market (ADOM)

Condos –

215 Active, 20 Contingent, 34 Pending, 8 TFT, 69 price reductions, 99 ADOM

Townhouses –

61 Active, 6 Contingent, 25 Pending, 1 TFT, 12 price reductions, 36 ADOM

Summary: Inventory up by 429 properties

In March of 2024, San Mateo County, there were 579 listings (91 of which are off market and only available to Realtors) and pending sales of 332 (51 contingent, 287 pending.

Provided by:

KIERSTEN LIGETI
Broker-Associate
THEAGENCY
#01298631
c: 650-766-8319
KPLuxuryHomes.com

Santa Cruz County as of July 12, 2024:

For Single Family Homes…

The median sales price for Single family homes in June 2024 throughout the County of Santa Cruz is up slightly from $1,362,500 in May to $1,413,000 in June.

The average days on market is up from 27 days on market in May to 28 days on the market in June. The number of active listings in June is up to 345 in June up from 344 in May. The number of new listings for June came in at 202, down from 232 in May.  And the number of closed sales came in at 112 in June which was a one property increase in sales volume from the 111 homes that sold in May. The sales price to list price ratio for single family homes came in at 99.0% in June. which is down just barely from 99.3% sales price to list price ratio in May. As for months of inventory, this number is tracking at 3.1 months of inventory, meaning if no other properties came on the market, our Santa Cruz housing inventory based on buyer demand would be sold out in 3.1 months. A neutral market, meaning equality between buyers and sellers is 6 months of inventory and we are not there yet.

For Condos and Townhomes…

The median sales price for June 2024 came in at $830,000 which is up almost $100,000 from the median sales price in May 2024 which came in at $735,000. The average days on market came in at 20 days on market, down from 27 days on the market in May.  The number of active listings in June 2024 for condos and townhomes was 89 in June up from 78, the month prior. And the number of sold condos/townhomes was down from 39 in May 2024 to 27 in June 2024. The number of new listings for condos and townhomes right here in Santa Cruz was up from 47 in May, to 60 in June. The sales price to list price ratio came in at 98.4%, in June, which is down from 99.2% sales price to list price ratio in May. And… our months of inventory for June 2024 came in at 3.3 months, up slightly from 2.2 months of inventory in May.

Summary: Inventory up by 151 properties

In March of 2024 in Santa Cruz County – There were 283 listings.

Provided by:

Shemeika Fox
Fox Realty Group, Inc.
(831) 588-2334
Sfox@YourSantaCruzRealEstate.com
YourSantaCruzRealEstate.com
DRE: 01479629

Important Note: Housing Inventory does fluctuate but historically over the last 10 years, supply has not kept up pace with demand causing overbidding on many homes sold with the exception was 2023 where residential real estate came to a standstill due to rising interest rates from January of 2023 at 3% to 7%+ (+or- .5%.)

Conclusion…

It appears housing inventory is increasing in some areas but still not to a place, where supply equals demand.  Currently its still a sellers markets where sellers have the power but that could be changing if inventory continues to rise and if demand from buyers also increases, prices will continue there way up.  More inventory also means, buyers have more to choose from and if inflation stabilizes and the federal reserve starts easing rates, buyers will pay less in rates and payments and buyer confidence will increase fueling the housing market.

In the lending industry, we all feel we won’t see rates in the 2% and 3% range but should see them in the mid 5’s.  This would be most welcomed  by sellers (that need to buy after) and buyers and lenders and any business that has been negatively affected by high interest rates in the last 12 to 18 months.

Expect to start seeing rates drop in q3 and q4 of this year (per my crystal ball) especially if the Dow and Nasdaq have recurring corrections.  Currently the 10 year treasury is at 4.22 a decent drop since July 1st when the yield was at 4.48% and even lower when compared to 4.63 back on 5/28/24 which means rates should be dropping which they have a tad, but nothing to write home about.

In Closing…if you’re…

Selling...and would like to understand your options, please reach out to us here, by completing the following inquiry.

Trading Up or Down…please go here.  In addition, I have a great presentation (Age in Place or Right Size) on the topic which I would be more than happy to share with you.

Buying for the First Time…please go here to learn about your options and purchase power.

 

Any Questions, please contact me at 650-465-8957 or at Rob@101loan.com.

Best Regards,

101 Loan
Senior Mortgage Advisor
www.101Loan.com
650-465-8957 c  hello@101loan.com
CA DRE #01205444  NMLS #326829
101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 60 banks with over 300 “Five Star” Reviews on Yelp, Google and Linkedin.
  5. Over 30 years of lending experience with over $2b in closed loan volume.

Note: Interest rates and loan programs quoted are subject to change without notice or until locked and approved by lender.

 

Ready to Buy a Home?  Follow These Steps!

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Step 1 – Research and Preparation

  • Understand the Process: Learn about the real estate market in your desired area.  Educate yourself on the home buying process and the need for representation by a realtor and lender that work together so mistakes are not made ensuring your success with home ownership.
  • Determine Your Purchase Power to include Home Affordability and Get Pre-qualified to understand your purchase power and what that buys you in terms of a property based on the price and its location.
  • Market Research: Learn about local home prices, inventory levels, and market demand in your specific search areas and what’s needed to ratify an offer on the purchase of a home.

Step 2 – Set Goals and Budget

  • Get Preapproved for Financing: Lender underwrites your income, debt, assets and credit report to determine your max purchase power in writing subject to the appraisal, ratified purchase contract and prelim.
  • Determine Your Wants and Needs: Bedrooms, Bathrooms, Locations, Schools
  • Understand Market conditions: Align your budget with local prices and what your preapproved for to ensure you can obtain what you want when buying based on inventory.
  • Plan your timeline: Stick to a schedule for home hunting and closing.
  • Advocate for yourself: Ask questions on what you don’t know and rely on your Realtor and Lender to guide you through the process of buying.

Step 3 – Start Your Home Search

  • Explore neighborhoods: Visit areas and test distance for dollars.  How far from work do you have to travel to find properties or the neighbor you like where you’d eventually like to buy.
  • Scout listings: Use real-time alerts and compare properties provided by your realtor based on your wants and needs.
  • Realtor leveraged networks: Some properties never hit the MLS.  Realtors have access to properties you will never have access to.
  • “Virtually” preview homes: Shortlist the properties meeting your needs so you can then schedule a real estate tour of those properties with your Realtor.  Make this a priority as properties sell fast in the current market (5-16-24)
  • Determine the Pro’s and Con’s of each property so you can narrow down on the ones you’d like to make an offer on.

Step 4 – Making Your Offer

  • Discuss Price to Offer with Realtor: Decide on your offer amount based on inventory, market conditions and how many other offers are being made on the same property.
  • Discuss Offer with Realtor and Lender: They can help you differentiate your offer over others by offering a quick closing or long closing based on the needs of the seller.  Closing date, contingencies, rent backs, credits, who pays for what.
  • Make sure preapproval is current and updated specific to the price you want to offer.
  • Make sure the Realtor has spoken to the listing agent about your offer and to ensure your offer is aligned with the seller as much as possible.
  • Make Sure the Lender calls the listing agent on behalf of the offer to communicate the strength of the offer and answer any questions.

Step 5 – Possible Counters and Acceptance

  • Understand multiple-offer scenarios: Have strategies ready with your realtor and lender.
  • Negotiate effectively: Secure the best terms and finalize the contract.

Step 6 – Facilitate Closing

  • Coordinate with all parties: Ensure clear communication with agents, escrow, title, lender, inspector, appraiser, escrow officer, insurance company and bank.
  • Order inspections and appraisals: Confirm property condition and value based on what’s drafted in the ratified purchase contract.
  • Track deadlines: Create timeline all parties follow and update immediately if there are delays from any party to ensure everyone is to up to date.
  • Review closing documents from realtor but also lender: Ensure accuracy and completeness.
  • Prepare for closing meeting: Coordinate with escrow and bring necessary items to sign and eventually close.
  • Finalize the transaction: Sign documents. Coordinate with lender and escrow to record the purchase.  Once the purchase is recorded, the keys to the buyer unless a rent back amount the seller and buyer was previously negotiated.

This summary highlights the key steps in the home-buying process, focusing on research, budgeting, searching for homes, preparing financing, making offers, negotiating, and finalizing the purchase.

Any questions, please contact me.

Best Regards,

101 Loan
Senior Mortgage Advisor
www.101Loan.com
650-465-8957 c  hello@101loan.com
CA DRE #01205444  NMLS #326829
101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

Products/Services/Accolades:
  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 60 banks with over 300 “Five Star” Reviews on Yelp, Google and Linkedin.
  5. Over 30 years of lending experience with over $2b in closed loan volume.

 

Interesting Times in Residential Real Estate: Recent Changes – NAR Development (Part 3)

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As we continue to navigate the dynamic landscape of the real estate market in the second quarter of 2024, recent developments involving the National Association of REALTORS® have stirred the industry, signaling significant changes on the horizon on seller/buyer representation and the historical fees paid by the seller to pay for real estate commissions.

Here’s what’s Unfolding and How it could Affect your Real Estate decisions…

NAR Settlement and Market Implications…

In a landmark move, the NAR has settled for $418 million in a series of antitrust lawsuits, a decision that’s expected to radically alter the structure of real estate commissions.

Here’s how this might affect the market…

  • New Rules Changing the Game: NAR’s new policies, including the prohibition of listing agents’ compensation in MLS listings, are set to transform how properties are marketed and sold and who pays what and how much.
  • Potential for Lower Commissions: Analysts predict a 25% to 50% drop, in realtor commission rates, possibly leading to more affordable real estate transactions and a shift towards alternative brokerage models.  In turn while paid commissions may go lower, so may the level of expertise, provided by Realtors.  An exception to this, is with those Realtors, who pride themselves in taking the utmost care of clients.

How This Affects You…

Whether you’re buying or selling, these changes could impact your strategy:

  • Sellers: Might find a more level playing field with potentially lower costs of selling and increased flexibility in choosing brokerage services.
  • Buyers: Could benefit from a broader range of options and possibly more competitive pricing on properties but responsible for their Realtors payment of services provided.
  • Real Estate Agents: With these changes, buyer’s agents, like listing agents, will require their clients to sign a buyer broker agreement* that will clearly detail what the buyers agent (realtor) will provide them in terms of services and what it will cost them (the buyer) as the seller will no longer be responsible for payment of services to the buyers agent (unless overturned by the NAR in appeals).

*Buyer broker agreements have been around for a long time, but this is the first-time buyers will be required to sign one and work exclusively with one agent.

Local Market Snapshot…

To give you a sense of how these changes mesh with current market conditions, let’s look at the local scene:

  • Inventory Levels: While inventory remains low in the bay area, nationally speaking, real estate inventory is providing a good balance of seller/listing supply and buyer demand. It will be interesting how the NAR changes affect inventory locally and nationally.
  • Pricing Dynamics: With the NAR settlement, we might see a shift in pricing strategies and property valuations across the board.

What’s Next…

The real estate market is at a pivotal juncture. As we anticipate the ripple effects of NAR’s recent settlement, staying informed and agile will be key to navigating the market effectively.  For more info on the above, be sure to reach out to us or your trusted real estate agent who is well versed on what’s occurring and how to tread through these tumultuous waters.

Need Personalized Advice?

Every situation is unique. If you’re contemplating your next move in real estate, let’s connect to discuss how these changes could influence your decisions.

Best Regards,

101 Loan

Senior Mortgage Advisor

www.101Loan.com

650-465-8957 c  408-377-4123 o

CA DRE #01205444  NMLS #326829

101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 60 banks with over 300 “Five Star” Reviews on Yelp, Google and Linkedin.
  5. Over 30 years of lending experience with over $2b in closed loan volume.

Sources:

https://www.nar.realtor/newsroom/nar-reaches-agreement-to-resolve-nationwide-claims-brought-by-home-sellers  March 15, 2024

https://www.cnn.com/2024/03/15/economy/nar-realtor-commissions-settlement/index.html  March 15, 2024

https://www.washingtonpost.com/business/2024/04/05/dc-circuit-nar-ruling-commissions/  April 5, 2024

Interesting Times in Real Estate…Part 2 (Interest Rates)

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As mentioned in part 1, Housing Inventory is influenced by many factors and one factor that has a large influence on real estate (whether it’s a good market or a bad one) is Interest Rates (the price you pay to borrow money over time).

When Interest rates are high, this usually slows down anything that’s is reliant on lending whether commercial, residential or consumer related.  When interest rates drop, businesses and consumers start spending again as their ability to leverage improves and their costs drops.

Interest Rates in the last 20 months – Once Very Low, Then Very High and Hopefully Going Lower…

In June/July of 2022, interest rates started climbing from all-time lows and continued their way up from 2.75% in rate in the residential markets to a whopping 8% as the Federal Reserve was trying to control inflation.

In August/Sept of 2023, the Federal Reserve started using language that they might slow down or stop increasing rates, as inflation showed signs that it was getting inflation under control and that they might ease rates in Q1 of 2024, great news for us loan originators, as we just had the worst year ever in 30 years of lending and why over 200,000 loan officers and support staff exited the industry similar to what was seen in 2008/2009 with the recession of the stock market and housing collapse.

At that time (still in Sept of 2023), the Federal Reserve shared their intention and plan on how they were going to lower rates in 2024, 2025 and 2026 getting us back to rates in the mid 4’s to mid 5’s.  In q1 of 2024 after seeing Decembers numbers for inflation, those plans were squashed as inflation started to rear its ugly head again even though the stock market was on fire which would normally fuel the real estate market but rates went from the mid 6’s to the low 7’s in less than 1 month and stayed that way until March when rates finally started to drop as the Federal Reserve stated in an FOMC Meeting that “the Committee decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 percent” which is in line with the same update in September of 2023 which was great news.

We hope the Fed’s continue to lower rates to fuel the economy and help the real estate market which should bring more buyers and sellers to the market.

What Do Interest Rates Really Do?

Interest rates directly affect the cost of borrowing for consumers and businesses alike. In the context of real estate, mortgage interest rates significantly influence the affordability of homes. Lower interest rates make mortgages more accessible and reduce monthly payments, stimulating housing demand. Conversely, higher interest rates increase borrowing costs, potentially dampening demand and slowing down the pace of home purchases. In the Bay Area’s high-priced real estate market, even slight changes in interest rates can have a substantial impact on affordability, housing activity and can increase or impede consumer confidence.

Interest Rates Affect Consumer Confidence?

Consumer confidence, a crucial driver of economic activity, is closely tied to interest rates. When rates are low, consumers are more likely to feel confident about making major purchases, such as homes and durable goods. This increased spending contributes to economic growth. Conversely, rising interest rates may cause consumers to postpone discretionary spending and investments, leading to a decline in consumer confidence and overall economic activity.

The Federal Reserve plays a central role in influencing interest rates through monetary policy decisions. By adjusting the federal funds rate, the Fed aims to achieve its dual mandate of price stability and maximum employment. Changes in the federal funds rate ripple through the financial system, impacting borrowing costs and, consequently, economic activity and real estate markets.

Summary…

In summary, interest rates in the Bay Area have far-reaching implications, affecting housing affordability, economic growth, and consumer sentiment. Monitoring interest rate trends is essential for stakeholders in the real estate industry, policymakers, and consumers alike, as they navigate the complexities of the market and plan for the future.

Any questions, please contact me.

Best Regards,

101 Loan
Senior Mortgage Advisor
www.101Loan.com
650-465-8957 c  408-377-4123 o
CA DRE #01205444  NMLS #326829
101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 60 banks with over 300 “Five Star” Reviews on Yelp, Google and Linkedin.
  5. Over 30 years of lending experience with over $2b in closed loan volume.

Note: Interest rates and loan programs quoted are subject to change without notice or until locked and approved by lender.

Interesting Times in Real Estate…Part 1 (Housing Inventory)

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2024 has been “interesting” to say the least in the world of real estate due to the following:

  • Housing Inventory
  • Interest Rates
  • Recent Changes in Residential Real Estate – NAR Developments, Market Impact and Trends
  • Changes in Commercial and Construction Financing

Over the next 4 weeks I’ll send an article on each topic (above) as it relates to Real Estate in the Residential and Commercial Space.  Please see below.

Housing Inventory and How its Affecting Buyers and Sellers

Before we get started, housing inventory, specifically residential housing, is defined as the total number of active listings plus pending sales in any given month and usually includes homes, town homes and condominiums.  To see this article in html, click here.

Factors that Influence Housing Inventory:

  • Cost of Money (Interest Rates)
  • Accessibility to Money (Lending)
  • The Economy (Locally and Nationally)
  • Consumer Confidence
  • Infrastructure of the Area*
  • The Stock Market
  • Job Growth
  • Inflation

*Infrastructure for these purposes is defined as the abundance or lack of land and buildable space, population in the area, number of large, mid and small cap sized companies local to one area, support services that include the number of schools (k-12), junior colleges, colleges and universities, hospitals, medical support, multiple sport teams, safety in an area, etc.  Example: Strong Areas typically include the Bay Area, LA, San Diego, Phoenix, Denver, Dallas, Miami, Boston, New York to name of few.

What’s a Perfect Real Estate Model?

One of the most perfect real estate models is considered the Bay Area.  This is due to its high infrastructure (see above for definition) compared to most areas in the country, but also has some of the most expensive real estate.  Where infrastructure is high and the above factors are positive, residential housing inventory is this area tends to be low just as its been since 2014 after the recovery from the 2008/2009 real estate crash that affected the country.

From 2014 and forward, inventory hasn’t gone back to “normal” levels, where there’s a balance of housing supply and consumer demand.  For the last decade (with the exception of 2023 when interest rates soared), residential housing inventory locally has been low and demand has been great exceeding supply.

Currently, inventory is as follows…

  • Santa Clara County – There are 1213 listings (801 homes, 282 condos and 130 townhomes) and pending sales of 900 (603 in homes and 297 in condos and townhomes as provided by Jen Beehler with Elevate Group  650-714-8216
  • San Mateo County – There are 579 listings (91 of which are off market and only available to Realtors) and pending sales of 332 (51 contingent, 287 pending) as provided by Kiersten Ligeti with the Agency  650-766-8319
  • Santa Cruz County – There are 283 listings and 52 pending sales and 77 contingent as provided by Dawn Thomas & Chuck Holcomb at the The Dawn Thomas Team at  650-7010-7822

Important Note: Housing Inventory does fluctuate but historically over the last 10 years, supply has not kept up pace with demand causing overbidding on many homes sold with the exception was 2023 where residential real estate came to a stand still due to rising interest rates from January of 2023 at 3% to 7% (+or- .5%.)


The Bidding War…Recent Stories

As inventory remains low in the Bay Area, if a property comes on the market where 1 or more buyers like it, when they offer, a bidding war occurs especially when the listing agent accepts offers on a certain day and time.  Result, this is pushing values higher.  See some recent stories that I personally experienced…

Story 1…Last month we had a client that bid on a property where there were 11 offers on a property listed for $1.595m.  Our bid was the winner at 1.8m due to a short closing and no contingencies.  We were worried that the appraised value would come in low but low and behold the appraised value came in and we closed with no issue.  This then becomes the new comp/closing for the area pushing values higher.

Story 2…Dawn Thomas (that provided info for Santa Cruz County) has a client that presented an offer at $2.1m bringing in a significant down payment and the home sold at $2.8m with the client knowing full well they may need to make of the difference if the appraised value comes in short (while we are waiting for the appraisal).  What’s crazy, with all this over bidding, when the property closes, that property becomes the new comp for their neighborhood pushing prices up further.  Just look at the recent Housing Price Index for San Jose, Sunnyvale and Santa Clara as it correlates to supply and demand of the local real estate market and the increase of home prices over time.

Summary

Low Housing Inventory with High Demand equals Overbidding and Higher Values in the Near Future.  If you’re a seller trading up or trading down or selling for profit, you can still sell for top dollar.  If you’re a buyer, if you buy now, your locking in the price as its expected to go higher due to housing inventory and lower rates as expected by the Fed Reserve in q3 and q4 of this year.  Next week, I will cover Interest rates and how they correlate with Real Estate and the over all economy and of course consumer confidence which also drives real estate prices up.

If you have any questions and would like to get preapproved or determine your purchase power or financing options, please contact me.  Thanks.


Best Regards,

101 Loan
Senior Mortgage Advisor
www.101Loan.com
650-465-8957 c 408-377-4123 o
CA DRE #01205444 NMLS #326829
101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 60 banks with over 300 “Five Star” Reviews on Yelp, Google and Linkedin.
  5. Over 30 years of lending experience with over$2b in closed loan volume.

Note: Interest rates and loan programs quoted are subject to change without notice or until locked and approved by lender.

 

 

 

Low Housing Inventory and High Interest Rates – If Your a Buyer, What Does this all Mean?

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Housing inventory remains very low in the Bay Area.  Even though interest rates remain high due to inflationary fears from the Fed’s, the higher cost of financing isn’t slowing the market down. 

In Santa Clara County, there are approximately 930 properties for sale (consisting of homes, town house and condos (as of July 2023)) with a median days on the market of 10 days.

In Santa Cruz County, there are approximately 305 properties for sale with a median days on the market of 22 days per Charles Holcomb with Compass Real Estate with the Dawn Thomas Team.  Its still very much a seller’s market with sellers demanding and getting prices well over list prices.

Last year I sold my home in Saratoga to downsize, thinking prices would go lower due to higher rates allowing to scoop up a great deal…Was I wrong!  In searching for property, I have seen multiple offers and listings going well above the list price.  In fact, I have seen accepted offers well above what comps support.  It feels a little like 2018 again.  Jen Beehler with the Elevate Group states as inventory remains lows, expect more of this.  She then went on to explain that when making an offer where financing is involved, its very important to be fully preapproved with the ability to close quickly.

At 101 Loan, we take pride in that, our preapprovals are fully underwritten (with DU run) allowing our buyers the ability to make offers without a loan contingency and close in a timely manner, sometimes in 3 weeks or less.  This helps our buyers make the strongest offer possible often times resulting in accepted offer.

For more on what we do for our buyers, please see below:

  • We get the buyer completely pre-approved before they make an offer, so they won’t need a loan contingency (unless we recommend having one), something seller’s require.
  • We strategize with the buyer and Realtor, to close in the quickest amount of time with the least amount of contingencies while keeping the buyers risk as low as possible.
  • At the time of an offer, we call the listing agent on behalf of the buyer and their Realtor to differentiate the offer over someone else’s. (This makes a huge difference in the eyes of the listing agent and seller and conveys strength in the preapproval)
  • We can close purchases in 21 to 25 days (as needed) depending on the loan program the buyer chooses. Faster is better in the eyes of the seller!
  • We provide a timeline to the buyer, the listing agent and the buyers agent, once the loan is locked; detailing each step of the transaction to ensure a smooth closing.  We ensure the buyer knows exactly what the loan will cost once locked and then update them immediately if there are any changes to the loan structure, as a result due to a change of circumstance.  We then re-summarize the costs before the buyer signs the loan docs.
  • We coordinate the buyer’s signoff with escrow and their Realtor, to ensure the purchase closes on time, as scheduled.

We basically “micro-manage” the purchase from start to finish to ensure everything goes as smoothly as possible, something crucial in this market, to ensure all parties have a smooth and stress-free closing.

If you’d like to get preapproved or determine your purchase power, please contact us.

Best Regards,

101 Loan

Senior Mortgage Advisor

www.101Loan.com

650-465-8957 c  408-377-4123 o  408-608-1921 f

CA DRE – License # 01205444  NMLS #326829

6090 Hellyer Ave #100, San Jose, CA 95138

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 50 banks with over 300 “Five Star” Reviews on Yelp, Google, Facebook and Linkedin.

Note: Interest rates and loan programs quoted are subject to change without notice or until locked and approved by lender.

 

What’s New in Real Estate?

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It’s been an interesting last few weeks with Real Estate, the Stock Market and Interest Rates!

First…

With the debt ceiling deal in place (thank god), what’s in store for us a country?  See what AP News wrote.  Glad this got put into place as interest rates in just 2 weeks rose .5% and since last month Monday have dropped .25%.  Hope this continues, as interest rates; since December 2021, have climbed 3% and have crippled the real estate and mortgage industry as whole.

Next…

Check out the Case Schiller Report.  It shows that in the last 2 months, the home value index rose.  Selma Hepp, the chief economist at CoreLogic, stated that the CoreLogic Case-Shiller Home Price Index reveals unexpected resilience through notable growth in home prices. The spring home buying season has witnessed a stronger influx of buyers compared to sellers, leading to a highly competitive market scenario. The scarcity of available existing homes is compelling buyers to pay more than the listed price, resulting in substantial price increases during the early spring period, surpassing the customary patterns observed during this time.

Lastly…

We’re teaching 3 Seminars at the Capitola Library in June (please invite your clients):

The Path to Successful Home Ownership – (On June 3rd at 1pm First Time Buyers looking to buy locally will learn valuable information about the process of buying in today’s real estate market.  Learn from a top Realtor and us, as they provide important info on how to buy, where to buy and why to buy in today’s fast-moving market.  For more info, go to https://santacruzpl.libcal.com/event/10719528)

Age in Place or Right Size – (On June 17th at 1pm, Seniors, Empty Nesters and Son’s and Daughter of Retired Parents are invited to learn about their options in “Right Sizing and or Aging in Place”. Learn about your options in Staying in Your Current Home or Selling and Moving locally or elsewhere. Also, learn about the pro’s and con’s of reverse mortgages and how they can help or how they can hinder home owners. A top realtor and top mortgage broker with over 30 years of experience with over 200 “5 Star” reviews, will be presenting.  For more info, go to https://santacruzpl.libcal.com/event/10719529)

How to Help Your Kids Buy in Today’s Market – (On June 24th at 1pm Learn How to Help Your Kids buy in Today’s Local Market through several real estate and loan options allowing your kids and yourself to create financial stability. There are several financing options available and 101 Loan at 101 Loan will teach you them with the help of one of his Top Local Realtors. Help Your Kids Make Home Ownership not just a Dream, but a Reality.  For more info, go to https://santacruzpl.libcal.com/event/10719532)

Any questions, please contact us.  Thanks.

 

Best Regards,

101 Loan

Senior Mortgage Advisor

www.101Loan.com

650-465-8957 c  408-377-4123 o  408-608-1921 f

101 Loan – 14435 C Big Basin Way, Saratoga, CA 95070

101 Loan LLC – CA DRE #01205444  NMLS #326829

101 Loan is an Associate of General Mortgage Capital Corporation

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1-4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 50 banks with over 300 “Five Star” Reviews on Yelp, Google, Facebook and Linkedin.

Note: Interest rates and loan programs quoted are subject to change without notice or until locked and approved by lender.

 

Why Are So Many People Leaving the Bay Area and California?

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Moving???

Recently I heard a stat from a Realtor that 10% of the Bay Area’s population in the last 12 to 18 months, have left the Bay Area for other areas throughout CA and abroad.  They have left for the following reasons:

  • Less or no state taxes
  • Lower home prices
  • Lower cost of living
  • Crime and homeless population plaguing our streets.
  • Traffic and congestion
  • For less politics

In addition, because of Shelter in Place (SIP) and Work From Home (WFH) companies have allowed employees to “zoom” in and work from home and not necessarily locally.  Even, my staff an I have not been in the office since March of last year and were realizing, why even have an office any longer.  In addition, so many companies like Tesla and Oracle are moving allowing employees to live and work elsewhere.  We once saw Apple move to Texas but they quickly came back.  Let’s see if that happens again with Tesla and all the other companies considering fleeing the state or Bay Area.

Lastly, I published a video on this subject with my good friend Cherie Schaller.  Cherie is a top producing agent for Sotheby’s in the Rocklin, CA area that is seeing this trend more often:

https://www.youtube.com/watch?v=lXPx33Cio2U&feature=youtu.be

If you are considering moving to to Rocklin, Roseville or surrounding areas where real estate is a fraction of the cost here. please contact Cherie at:

https://www.cherieschaller.com/

For more info on relocating out of the Bay Area or determining your purchase power, please go to https://101loan.com/purchasing-start/ or contact me at:

Best Regards,

101 Loan

Senior Mortgage Advisor

www.101Loan.com    hello@101loan.com

408-377-4123 o  650-465-8957 c

101 Loan LLC – 1601 S De Anza Blvd, Suite 260, Cupertino, CA 95014

CA DRE #01205444  NMLS #326829

Products/Services/Accolades:

  1. Residential Financing for Purchases and Refinances on 1 to 4 unit properties.
  2. Reverse Mortgage Financing to include Conforming, Jumbo, HELOC Jumbo’s.
  3. Commercial & SBA Financing to include Multifamily, Office, Retail and Light Industrial.
  4. Access to over 50 banks with over 200 “Five Star” Reviews on Yelp, Google, Facebook and Linkedin.