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Local Home Prices among Highest in Bay Area

Sat, 20 Jul 2013 15:27:52 +0000

San Mateo County saw a $135,000 jump in median home price in just one year, according to numbers released Thursday by DataQuick.

Article source: http://southsanfrancisco.patch.com/groups/real-estate/p/local-home-prices-among-highest-in-bay-area

Bay Area Housing Prices Take Big Jump

Tue, 18 Jun 2013 07:43:22 +0000

U.S. home prices jumped 10.9 percent in March compared with a year ago, the most since April 2006.

A growing number of buyers are bidding on a tight supply of homes, driving prices higher and helping the housing market recover. The Standard Poor’s/Case-Shiller home price index released Tuesday also showed that all 20 cities measured by the report posted year-over-year gains for the third straight month. And prices rose in 15 cities in March from February. That’s up from only 11 in the previous month.

The monthly figures aren’t seasonally adjusted and may reflect the beginning of the spring buying season.

Prices rose in Phoenix by 22.5 percent over the past 12 months, the biggest gain among cities. It was followed by San Francisco (22.2 percent) and Las Vegas (20.6 percent). New York City had the smallest year-over-year increase at 2.6 percent, followed by Cleveland at 4.8 percent.

“Rising home prices may begin to alleviate a lack of housing inventory … by encouraging more homeowners to put their properties on the market,” said Maninder Sibia, an economist with Economic Advisory Service, in a note to clients.

“The housing market is clearly improving.” The index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The March figures are the latest available.

The U.S. housing market is steadily recovering, buoyed by solid job gains and near-record low mortgage rates.

Sales of new homes rose in April to nearly a five-year high. And sales of previously occupied homes ticked up in April to the highest level in three and a half years. Despite the gains, a limited number of homeowners are putting their houses on the market. That’s helped lift home prices. And it’s made builders more willing to ramp up construction. Applications for building permits rose in April to the highest level in nearly five years.

The supply of available homes jumped in April, but was still 14 percent below its level a year earlier. Stan Humphries, chief economist at Zillow, a real estate data provider, said that the increase in the Case-Shiller index has been skewed higher by cities such as Phoenix and San Francisco.

Fewer homes are available in those areas because many homeowners still owe more on their mortgages than their homes are worth.

That makes it difficult to sell. Still, even excluding those markets, home prices are rising steadily nationwide, Humphries said. The increases are “certainly confirmation that the housing market is experiencing a brisk recovery,” he added.

The housing recovery is creating more construction jobs and bolstering the economy in other ways. Higher home prices make homeowners feel wealthier and encourages them to spend more.

Rising prices also encourage more would-be buyers to purchase homes, before prices rise further.

They also enable more homeowners to sell homes, by reducing the number of people who owe more on their mortgages than the homes are worth. Prices have been increasing steadily since last summer.

Still, they are about 29 percent below the peak reached in July 2006. Banks have raised their credit standards since the housing bubble burst and are demanding larger down payments. That’s made it particularly hard for potential first-time buyers to get a mortgage.

Copyright Associated Press

Article source: http://www.nbcbayarea.com/news/local/Bay-Area-Housing-Prices-Take-Big-Jump-209268641.html

Builders Can’t Keep Pace With Demand As Bay Area Housing Booms Again

Tue, 11 Jun 2013 13:10:21 +0000

SUNNYVALE (KCBS)— New townhome projects continue at a rapid pace in Sunnyvale, where home construction can barely keep up with demand. The 14 currently under construction probably won’t be empty for long. Home values increased nearly 11-percent nationwide over the last year, but homes in the Bay Area are getting even greater gains.

The Standard Poor’s/Case-Shiller home price index released Tuesday showed that all 20 cities measured by the report posted year-over-year gains for the third straight month.

And prices rose in 15 cities in March from February. That’s up from only 11 in the previous month. The monthly figures aren’t seasonally adjusted and may reflect the beginning of the spring buying season.

Prices rose in Phoenix by 22.5 percent over the past 12 months, the biggest gain among cities. It was followed by the Bay Area (22.2 percent) and Las Vegas (20.6 percent).

Niccole Beckerman said her family has been priced out of the Silicon Valley.

“It’s really expensive. My parents were trying to buy a house and it’s really expensive just because the schools are really good,” Beckerman said.

The story is the same throughout much of the Bay Area. According to the San Francisco Association Of Realtors, the median Bay Area price for a single-family home has crossed above the $1 million mark for the first time since 2007.

The Inventory of available homes remains extremely low according to San Jose realtor David Martz. He said there are only about 1,000 homes for sale in a population of nearly two-million people in the greater San Jose area.

“Combined with the fact that we currently have interest rates at an all-time low, it’s possible to get an interest rate close to three percent, which is driving demand, so the buyers are out there in force,” said Martz.

Martz said four out of every five homes that come on the market here receive multiple offers, with prices, in some cases, going up hundreds of thousands of dollars over asking.

Despite the gains, a limited number of homeowners are putting their houses on the market. That’s helped lift home prices. And it’s made builders more willing to ramp up construction. Applications for building permits rose in April to the highest level in nearly five years.

The supply of available homes jumped in April, but was still 14 percent below its level a year earlier.

Stan Humphries, chief economist at Zillow, a real estate data provider, said that the increase in the Case-Shiller index has been skewed higher by cities such as Phoenix and San Francisco. Fewer homes are available in those areas because many homeowners still owe more on their mortgages than their homes are worth. That makes it difficult to sell.

Still, even excluding those markets, home prices are rising steadily nationwide, Humphries said. The increases are “certainly confirmation that the housing market is experiencing a brisk recovery,” he added.

The housing recovery is creating more construction jobs and bolstering the economy in other ways. Higher home prices make homeowners feel wealthier and encourages them to spend more.

Rising prices also encourage more would-be buyers to purchase homes, before prices rise further. They also enable more homeowners to sell homes, by reducing the number of people who owe more on their mortgages than the homes are worth.

Prices have been increasing steadily since last summer. Still, they are about 29 percent below the peak reached in July 2006.

Banks have raised their credit standards since the housing bubble burst and are demanding larger down payments. That’s made it particularly hard for potential first-time buyers to get a mortgage.

Article source: http://sanfrancisco.cbslocal.com/2013/05/28/builders-cant-keep-pace-with-demand-as-bay-area-housing-booms-again/

Home prices in Bay Area up 17.5% in January

Wed, 27 Mar 2013 06:59:10 +0000

Home prices in the five-county San Francisco metro area surged 17.5 percent in January versus a year ago – one of the biggest gains nationwide – according to a key gauge released on Tuesday.

Overall, U.S. home prices registered their biggest annual climb since summer 2006, rising 8.1 percent compared with last year, according to the SP/Case-Shiller composite index. Every one of the 20 major metropolitan areas Case-Shiller tracks posted year-over-year gains. The annual gains accelerated in 19 of the markets, with Detroit the only exception.

“The number that jumps off the page is San Francisco’s 17.5 percent increase in the past 12 months,” David Blitzer, chairman of the index committee for SP Dow Jones Indices, said. “That’s pretty big. Only one city, Phoenix (with a 23.2 percent increase), did better. Compared to the low points, you’re way up there, about 25 percent over the low. It’s a strong comeback.”

Resale homes

Case-Shiller defines the San Francisco metro area as Alameda, Contra Costa, Marin, San Francisco and San Mateo counties. The index tracks sales of the same single-family houses over time, comparing changes with a base value of 100, which represents values as of January 2000.

The San Francisco index is now 147.45, meaning that prices are 47.45 percent above their January 2000 level. The region’s index peaked at 218.37 in May 2006 and hit a low of 117.74 in March 2009 – so prices are still 32.5 percent below their peak, according to the index.

Several forces propel the upward trend, notably an improving economy, low interest rates, tight inventory and fewer foreclosures.

The San Francisco area “is the second-leading place in the country in job creation (after Houston), and doesn’t build a lot of houses, so supply is very tight,” said Ken Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at UC Berkeley. “We added 210,000 jobs to the Bay Area in the past 2 1/2 years – that’s a lot of people.”

Similar forces are driving the rental market, which is also experiencing big price run-ups. Exacerbating that situation, the tight for-sale inventory “is forcing a lot of people who want to be buyers to remain as renters,” Rosen said.

Rosen and others said Case-Shiller actually understates the turnaround – prices have risen even more than the index can capture. In part, that’s because it has a long lag time, measuring prices in January. Real estate service DataQuick, for instance, reported that February median sales prices in the nine-county Bay Area were up 24.6 percent compared with the same time in 2012.

“I would say Case-Shiller under-represents,” said Charmaine Frank, Redfin real estate’s area manager for San Francisco, San Mateo, Santa Clara and Marin counties. “The market has taken a pretty dramatic turn since January.”

Cash is the fuel

Like agents throughout the Bay Area, she said there are “enormous bidding wars going on. We see upwards of 40 to 60 offers on some properties; typically the top five to eight will be all-cash buyers.”

The numerous cash sales help fuel price appreciation, she said, because buyers skip getting an appraisal since they don’t have a mortgage. Appraisals, which rely on recent comparable sales, would moderate the rapid run-up.

“There’s a huge shortage of homes on the market right now,” said Cindi Hagley, a broker with the Hagley Group at Prudential California Realty in San Ramon. “For example, there are only 12 single-family homes for sale in Dublin right now. Ordinarily there should be 100 to 150 homes for sale there.”

Patrick Newport, U.S. economist with market analyst Global Insight, said that the rising home prices should help boost the economy further. “They stimulate new construction, and they also help consumer spending because they raise the value of people’s homes,” he said.

With multiple bids and properties selling well above asking price, could another real estate bubble be forming?

“Not yet,” said Rosen. “If they keep (interest) rates this low for two more years, the answer is yes.”

“This time, rapidly rising prices are a good thing,” Newport said. “A lot of homeowners are underwater; this helps them come out of that.”

Carolyn Said is a San Francisco Chronicle staff writer. E-mail: csaid@sfchronicle.com Twitter: @csaid

Article source: http://www.sfgate.com/business/article/Home-prices-in-Bay-Area-up-17-5-in-January-4386974.php

Foreign buyers shopping for Bay Area real estate

Mon, 10 Sep 2012 22:30:02 +0000

The fall in the U.S. housing market in recent years is attracting a new wave of foreign buyers, who are making a dent in the Bay Area and national real estate markets, the San Francisco Chronicle reports.

Foreign buyers spent $82.5 billion on homes in the U.S. during the 12 months ending in March, an increase of $66.4 billion a year earlier, according to the National Association of Realtors.

As for the Bay Area, about 6 percent of all property searches by prospective buyers are from abroad, according to the real estate site Trulia.com, with San Francisco being the most-popular search location.

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Article source: http://www.bizjournals.com/sanfrancisco/morning_call/2012/09/foreign-buyers-shopping-for-bay-area.html

Peninsula rents going the way of SF and Manhattan

Mon, 20 Aug 2012 02:05:27 +0000

San Francisco and Manhattan are famously unaffordable cities to rent in– not that such information discourages people from renting in either location. High demand, of course, is part of the sky high prices.
But according to a new study by Apartment List.com, Peninsula rents are quickly rising to rival those of San Francisco proper. Over both 12-month and 18-month periods in the area as a whole, rents have risen an average of 10% and 18%, respectively. Here’s a run down of their data, showing rent changes for different sized units. (UPDATE: This chart is a corrected version of the previous one that contained incorrect percentage numbers.)

Rents going up…and up! Data via ApartmentList.com

In terms of where to find the highest demand, Apartment List doesn’t have data on every city on the Peninsula, but reports that Mountain View jumped 45%, San Mateo jumped 54% and Sunnyvale jumped 40%.Over the last 12 months, the cities rank in this order (aggregate rise = 10%)

Clearly, the recent tech boom has a lot to do with this rent spike. The high salaries of this industry creates a competitive rental market, whereby landlords can ask higher rents. Tenants may end up offering even more than that rent, in order to stand out from the dozens of other people applying for an apartment.

John Kobs, CEO of Apartment List points out that another big factor is inventory of homes for sale. “For the past two years the available inventory of for sale homes in the Bay Area has been at an all-time low.” As a result, many people who want to buy are forced to become renters instead, unable to find a home for sale. And logically, “these people who are able to buy have higher income on average than renters, and are therefore able (and willing to) pay more rent. The supply side of for sale housing is a key driver in the increase in rents.”

Local Experiences

Many of us have friends looking for apartments now reporting back with horror stories– or maybe we have those horror stories ourselves: incredibly high rents, hundreds of people looking at available units, desperate applicants offering everything from home baked cookies to cold, hard cash to sweeten their chances. But can it all continue? Readers, is there any end in sight for rising rents in the Bay Area?

Anna Marie Erwert writes from both the renter and new buyer perspective, having (finally) achieved both statuses. She focuses on national real estate trends, specializing in the San Francisco Bay Area and Pacific Northwest. Follow Anna on Twitter: @AnnaMarieErwert.

Article source: http://blog.sfgate.com/ontheblock/2012/08/16/peninsula-rents-going-the-way-of-sf-and-manhattan/

In a Twist, Both Home Prices and Rents Rise

Wed, 08 Aug 2012 00:32:55 +0000

Home prices across the nation continued their upswing in June, according to a new report from CoreLogic. Including sales of foreclosures and short sales (selling for less than the value of the mortgage), prices rose 2.5 percent from a year ago. That is not quite as high as the annual increases seen in April and May. With the first half of the year now on the books, analysts are asking if prices can sustain.

“At the halfway point, 2012 is increasingly looking like the year that the residential housing market may have turned the corner,” said Anand Nallathambi, president and CEO of CoreLogic. “While first-half gains have given way to second-half declines over the past three years, we see encouraging signs that modest price gains are supportable across the country in the second-half of 2012.”

Home price gains will continue to be as much a factor of supply as they are of overall consumer confidence. While confidence in the overall economy has slipped slightly, optimism in the housing market remained strong in July, according to a just-released Fannie Mae survey:

“Survey respondents expect home prices to increase 1.7 percent in the next 12 months, down slightly from the survey high of 2.0 percent recorded in June. Eleven percent of respondents – the lowest level recorded since the survey began in June 2010 – believe home prices will drop in the next year. Also, in the highest level seen since the survey’s inception, 16 percent of consumers say it is a good time to sell.”

Still one quarter of respondents, an increase from June, are concerned about losing their jobs, and jobs have been the leading factor in the housing recovery. It is that unemployment uncertainty that has led so many younger Americans in the past few years to rent. That continued demand is pushing rents ever higher.

Asking rents rose in 24 of the 25 largest rental markets from a year ago, according to a new report from online real estate company Trulia. Rents are pushing double digit gains in San Francisco, Miami, Oakland, Denver, Seattle and Boston, and rents are rising faster than asking prices in 21 of the 25 largest rental markets year-over-year.

“For the first time, [home] prices are up year over year in a majority of metros, and asking home prices have increased for six straight months,” writes Trulia’s chief economist Jed Kolko in a release. “Rents, however, are rising even faster than prices in most markets. These price and rent increases, along with declining vacancies, should encourage new construction, which means housing will finally start contributing to the economic recovery.”

The question remains, where is the tipping point? As it becomes more expensive to rent than buy in more markets, more Americans should turn to buying, but so far they are not. Issues with negative equity, credit and confidence continue to plague home buying.

And are rents approaching bubble status? Investors continue to flock to the distressed housing market, trying to take advantage of rising rents, specifically in single family. Many of those investors say they are not concerned about a bubble, believing there has been a sea change in attitudes toward home ownership that could last through the decade. Whether it is attitudes or lack of available credit keeping the rental market on a tear, at some point, as happened during the housing bubble, prices will prevail.

Questions? Comments? And follow me on Twitter @Diana_Olick

Article source: http://www.cnbc.com/id/48547923?__source=RSS*blog*&par=RSS

Bay Area housing trends continue: Sales are up, prices are down

Thu, 19 Jan 2012 05:47:03 +0000

December real estate activity in the Bay Area mirrored the rest of the year’s activity — sales slowly gained while prices dropped.

Home sales increased 4.4 percent from December of 2010, market researcher DataQuick reported Wednesday, marking the sixth consecutive month Bay Area home sales rose on a year-over-year basis. In the same period, the median price declined 6.3 percent, falling to $351,500.

The loss of value in Bay Area homes has been a developing trend since the mortgage crisis struck in 2007. From the beginning of that year to the end of 2011, the loss in home value in five Bay Area counties was $387 billion, a 33 percent decline. That figure — calculated by DataQuick for the Bay Area News Group based on the average price per square foot paid for housing — is necessarily an estimate, because it’s based on the value of houses sold, and the types of homes sold in both periods.

Contra Costa County was hit the hardest, followed by Alameda, Santa Clara, San Mateo and San Francisco, in that order. There was a wide variation within counties, with some areas hit harder than others.

DataQuick president John Walsh said the pattern reflects the drive to find bargains in the distressed Bay Area housing market, for which DataQuick examines 10 counties in the region.

“Many of the deals that did make their way through the system were in the distressed arena — foreclosures and short sales. Much of it was deeply discounted cash

purchases, disproportionately at the lower end of the price scale,” Walsh said in the San Diego-based company’s news release.
Sales of homes that had been foreclosed upon within the previous 12 months accounted for 28.6 percent of homes resold in the Bay Area in December, DataQuick reported, though that metric decreased from 30.1 percent in December 2010. Short sales — which is when a house sells for less than the remainder of what was owed on the property — were about 21 percent of Bay Area homes resold in December, up from 18.1 percent a year earlier.

The biggest Bay Area decrease in median price for new and resale homes and condos for the month of December was in San Mateo County, where the median price dived from $560,000 in December 2010 to $500,000 in the same month last year, a decline of 10.7 percent. Sales declined on the Peninsula as well, dropping 2.3 percent from the same month in the previous year.

Santa Clara County also experienced a drop in sales from the year before, falling 2.1 percent from 1,646 homes sold in December 2010 to 1,616 sold last month. Alameda and Contra Costa counties were more in line with the overall Bay Area trend: Alameda County experienced a 4.5 percent increase in sales, hitting 1,584 homes sold, and a 5.5 percent decrease in median price, to $328,000; Contra Costa County’s home sales rose 3.1 percent year-over-year, to 1,534, with the median price dropping 2.3 percent to $259,000.

Extreme examples of the trend occurred in the North Bay, with Sonoma and Marin counties experiencing double-digit growth in year-over-year home sales and large dips in median price at the same time. Sonoma County’s home sales increased 17 percent to 538, while the median price fell 9.8 percent to $279,500; 280 homes were sold in Marin County in December, a 23.9 percent increase from the same month in 2010, while the median price declined 13.6 percent in the same period to $517,818.

While the volatility of prices has caused stress among realtors, experts say it is the perfect time to buy a home — if you can qualify for a loan in the tough credit market.

“We’re going to see prices stabilize,” Ken Rosen, chairman at the Fisher Center for Real Estate and Urban Economics at UC Berkeley, said late last year. “It’s already happening in pockets like Silicon Valley and San Francisco. If you want to buy a house, it’s probably the best time in California in 30 years.”

Staff writer Pete Carey contributed to this report. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/mercbizbreak.

Article source: http://www.mercurynews.com/top-stories/ci_19766802

Investors help prop up Bay Area housing market

Sun, 30 Oct 2011 15:54:10 +0000

Real estate investors have become a potent force in a moribund housing market, accounting for more than a fifth of transactions in the Bay Area over the past 12 months, according to real estate data.

Despite record low interest rates, many consumers simply don’t have enough confidence in their economic outlook to buy houses. Investors keep some properties – especially ones that need extensive work – from languishing unsold for months and have kept prices from nose-diving further, real estate experts say.

“The market would be quite a bit sicker were it not for investors snapping up a lot of the properties,” said Andrew LePage, analyst at DataQuick real estate service. “They account for a meaningful portion of the demand. To the extent to which there’s at least a temporary floor under this market, they’ve helped to build it.”

In addition to homes sold through the multiple listing service, an increasingly large share of properties at courthouse-steps auctions – the final stage of foreclosure – are being bought by investors. Some 5,243 properties were purchased by nonbank entities in the 12 months ended in September, according to ForeclosureRadar.com.

Almost half of the Bay Area homes purchased on the open market are distressed – either bank-owned foreclosures or short sales being sold for less than the mortgage. Often these properties suffer from deferred maintenance, making them challenging for an owner-occupant.

Investors play a valuable role in buying and rehabbing such properties and then re-selling or renting them out, said Jeff Weissman, a Realtor with Highland Partners/BHG in Oakland. “They clear out inventory and then bring it back on the market in move-in condition, thus improving neighborhoods and giving opportunities to first-time home buyers,” he said.

Not everyone is enthusiastic about investors. Other home buyers complain that they get muscled out by deep-pocketed investors who can pay all cash, LePage said. Sellers prefer cash offers because they’re quick, clean and guaranteed to close. Community groups worry about investors turning into slum landlords as they manage fleets of rentals.

Some of investors’ bad rap stemmed from boom-time flippers, who capitalized on a rapidly rising market.

“There is a huge difference between speculation and investing,” said John Robin, a Realtor with BHG/Mason-McDuffie in Berkeley. “Until 2009, most (non-homeowners) buying real estate here in the Bay Area were speculating on appreciation. What an investor does is look at what a property will cost now to purchase and operate, and look at the return every month. If one day they can sell it and make a profit, that’s even better.”

He sees more investors becoming landlords although there are still plenty of flippers.

With prices continuing to soften, more “ordinary people” are getting involved in real estate investing, since the barriers to entry are lower, Robin said.

“The biggest growth area is first-time, small investors,” he said. “These are people who may have cashed out (other investments) that they want to put into real estate. Some people use self-directed IRA money to buy real estate. Sometimes it’s families who pool their money together or individuals who have jobs and do this to supplement their income.”

The Obama Administration implicitly recognized investors’ value in the marketplace this summer when it called for proposals from investors and others on how to buy, rehab and rent out the legions of foreclosed properties owned by Freddie Mac and Fannie Mae.

But investors are not a single monolithic entity. They come in all types, from the mom and pop who buy a couple of rentals to fund their retirement, to the professionals who deal in dozens of homes a year as a full-time occupation. Here are profiles of three types of real estate investors currently looking in the Bay Area.

Professional

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/10/29/BU411LMJIV.DTL&type=business

And the REIT Winner Is — Storage?

Thu, 09 Jun 2011 09:46:58 +0000

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Hundreds of investors in real estate investment trusts are hunkered down at the Waldorf Astoria, touting tremendous returns and talking tactics for the next great play. It’s “REIT Week,” in New York, or for those of you less excited about it, it’s the annual conference of the National Association of Real Estate Investment Trusts (NAREIT).

REITs overall are on a tear, with the FTSE NAREIT All Equity REITs Index up 14.13 percent on a total return basis in the first five months of the year.

But when I read down the fact sheet to the winners and losers, imagine my surprise to see the least sexy of the bunch at the top of the list: Self storage.

Forget the run on multi-family in the new rental age, forget the trophy office properties in the big metro markets, it’s those giant, brightly colored, enormous metal container communities just out beyond the mall that are reaping REITs rewards.

It’s simple, and it’s about housing. As fewer people choose to buy, and more people lose their homes, that’s where all their stuff goes. It’s also a product of overall downsizing. I realize that’s not a very highbrow explanation, but it just so happens to be the case, and it’s behind an 18.4% sector gain in the first five months of the year. In the last 12 months, self storage REITs returned 29 percent.

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Article source: http://www.cnbc.com/id/43329496?__source=RSS*blog*&par=RSS