homesmillbrae.com » Declines

Bay Area home price growth levels off

Fri, 09 Aug 2013 04:42:10 +0000

Buying ain’t easy. First prices soar, then they slow down, but rising interest rates make up the difference.

Blanca Torres
Reporter- San Francisco Business Times

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The rapid rise of home prices may be slowing, but too bad interest rates are now creeping up.

In the Bay Area, home prices are still growing, but not as fast, according to Trulia, the San Francisco-based online real estate marketplace.

The firm found that while home prices jumped 17.2 percent in the month of July compared with July 2012, price growth slowed down during the last six months. From January to March, prices rose by 6.5 percent and from April to June, they went up 3 percent.

“The biggest price slowdowns have come to some of the hottest local markets,” said Jed Kolko, Trulia’s chief economist. “California and Nevada remain the Wild West for asking home prices, with some of the sharpest drops during the bust, strongest rebounds over the past year, and now biggest slowdowns in the past quarter.”

Nationwide, asking home prices dropped slightly— 0.3 percent — in July compared with the previous month. It’s the first time since November 2012 that prices didn’t go up.

They are still up 11 percent for the month of July compared with the same month last year.

One major factor deflating home prices is rising interest rates during the past six months.

In the past couple of years, historically low interest rates boosted sales and skyrocketing price growth, but higher rates are now dampening the mood.

“Asking home prices are now starting to lose steam as mortgage rates rise, inventory expands and investor demand declines,” said Trulia in a recent market report.

A year ago, a buyer could afford to pay a higher asking price because interest rates were low. Now, buyers may end up paying the same per month, but more of their payment will go toward interest versus the principal value on the loan.

So even if prices level off or go down in the months to come, buying a home in the Bay Area will still be just as costly if not more.

Blanca Torres covers East Bay real estate for the San Francisco Business Times.

Article source: http://www.bizjournals.com/sanfrancisco/blog/real-estate/2013/08/bay-area-home-price-growth-leveling-off.html

Home prices keep on ratcheting up as Bay Area outpaces national growth

Thu, 30 May 2013 11:20:24 +0000

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Homes keep getting bid up over asking, which keeps pushing up prices. Another week, another real estate report showing that home prices are on a tear, with the Bay Area among the nation’s leaders. This time, it was the SP/Case-Shiller home-price index showing double-digit prices increases.

Here are photos from one of those now-commonplace scenarios: A perfectly nice, but not extraordinary house that went for way over asking. In this case it was a four-bedroom rancher in Walnut Creek’s Larkey Park area. Listed for $615,950, it went for $650,000 — $34,050 or 5.5 percent over asking.

On average, homes in the 9-county San Francisco Bay Area area are selling for 103.6 percent of asking; this time last year, they went for 100 percent of asking, said Lanny Baker, CEO of Emeryville’s ZipRealty.

Realtors around the Bay Area continue to report flocks of buying chasing super-tight inventory. ZipRealty shows that for-sale Bay Area inventory is down 43 percent from this time last year to only about 6,998 homes. In 22 out of 24 metro areas it tracks nationwide, ZipRealty “saw more new listings as of April 30 compared to April 30, 2012,” it said in a report. “San Francisco and Austin were the only two metros showing slight declines in new listings.”

“Five of the top seven cities in our national report on price appreciation are in California,” Baker said. “We see San Francisco (metro) as the No. 1 city in the country right now for price momentum,”

In the Case-Shiller report, prices for a 20-city composite index were up 10.9 percent in March versus a year earlier. For the SF metro, which Case-Shiller defines as the counties of San Francisco, Marin, San Mateo, Alameda and Contra Costa, the increase was a strong 22.2 percent, second only to Phoenix’s 22.5 percent gain. For an in-depth look at the report and its implications, click here.

Carolyn Said is a San Francisco Chronicle staff writer. Follow her on Twitter: @csaid

Article source: http://blog.sfgate.com/ontheblock/2013/05/29/homes-prices-keep-on-ratcheting-up-as-bay-area-outpaces-national-growth/

Home Builders Get Jitters for First Time in a Year

Sat, 23 Feb 2013 12:43:06 +0000

Of the three components making up the index, current sales conditions fell one point to 51, still the only component solidly in the positive. Sales expectations over the next six months rose one point to 50, but buyer traffic remained the weakest, falling four points to 32.

(Read More: Foreclosures Fall Due to New Laws)

Regionally the Northeast saw improvements in builder sentiment, as did the West, but the Midwest and South both slipped, down two points each. The Northeast is seeing gains in construction due to the rebuilding effort following Superstorm Sandy. That was apparent in another index released Monday gauging home remodeling. The Buildfax remodeling index showed seasonally adjusted annual rates of remodeling in the Northeast at 636,000 in December of 2012 — up 39 percent from November and up 37 percent from a year ago.

“The last time the Northeast broke 600,000 estimated residential remodels was five years ago,” wrote BuildFax’s Joe Emison in a release. “Unfortunately, the rest of the country saw both month-over-month and year-over-year declines in residential remodeling activity.”

Article source: http://www.cnbc.com/id/100469988

Fewer Borrowers Are Behind on Mortgages, but for How Long?

Tue, 12 Feb 2013 23:13:38 +0000

“The declines in the mortgage delinquency rate will likely be muted for the foreseeable futures as the foreclosure process in some states can take more than 1,000 days,” notes Tim Martin, of TransUnion’s financial services business unit. “It is not clear yet, but recently announced regulatory rules related to mortgage servicing may tend to slow down this process further.”

Delinquencies dropped 6 percent annually in 2011 and 7 percent in 2010. This after jumping over 50 percent in each of the previous two years. The trouble is not with new loans but with a long legacy of troubled loans from the housing boom. While these loans make up 60 percent of mortgages outstanding, they account for 90 percent of loans gone bad. Attempts at loan modifications as well as long delays in the foreclosure process have kept these loans stuck in a bloated pipeline.

There are borrowers today that have not made a mortgage payment in several years but have still not lost their homes. New laws in California and Nevada slowed the foreclosure process considerably, while New York and New Jersey are still facing huge backlogs of bad loans that will take years to make their way through the states’ court process.

(Read More: New Housing Fears: Home Prices Are Rising Too.)

Nationally, the mortgage delinquency rate now stands at 5.19 percent, down from 6.01 percent a year ago, but still far from the historical average of around one to two percent. While loans made in the past few years, using far stricter underwriting, are faring very well, there is a concern that thousands of mortgage modifications made during the same time will default again. Negative equity, while improving, continues to plague millions of borrowers and makes selling the home impossible. Should these borrowers need to move, they will likely have to default on their home loans.

(Read More: Why Home Builders Won’t Drop New Home Prices,)

Article source: http://www.cnbc.com/id/100453098

Is Housing Risen From Ashes? ‘Industry Has Come Back’

Tue, 25 Sep 2012 23:52:46 +0000

Economists are saying it, and now even some Americans are saying it.

After falling to depths not seen since the Great Depression, the U.S. housing market may finally be rising from the ashes.

It may not seem like a lot, but 27 percent of Americans believe the value of their homes will increase in the next year, according the CNBC All America Economic Survey.

That is the highest percentage since 2007 and the third straight quarter that such optimism has gained. (Read More: CNBC Poll: Economy’s Worse, but Obama Favored to Fix It.)

“Overall the housing industry has come back,” said Standard and Poors’ David Blitzer, commenting on Tuesday’s release of the latest SP/Case-Shiller home price indices. “We might finally get a little boost to the economy from the housing sector.”

Home prices in the nation’s top twenty markets rose 1.2 percent in July from a year ago, according to SP/Case-Shiller. (Read More: US Home Prices Rose for Sixth Month in a Row: Case-Shiller.)

All of those markets saw month-to-month price gains, while just four saw annual declines. Atlanta continues to see the largest drop, down just under 10 percent year-over-year, but even its declines are easing.

In Phoenix, where distressed properties have made up the bulk of home sales, prices are up 16.6 percent from a year ago, due to big supply shortages of low-end homes.

Home prices are still down 30 percent from their peak in 2006, but just the prospect of a real bottom has some buyers finally getting off the fence. In addition, rising prices helped 1.3 million home owners to rise out of a negative equity position on their mortgages in the first half of this year, according to CoreLogic.

Nearly 11 million, or 22 percent of all borrowers, are still stuck in place, owing more on their mortgages than their homes are worth, and an additional 2.3 million have less than 5 percent equity in their homes, making a move up unlikely. (Read More: More Homes Are Above Water, But Some Sellers Still Suffer.)

The latest numbers, from existing home sales to earnings from the big public home builders, are fueling much-needed confidence in housing, but it would be naïve to declare that this industry is completely out of the woods.

Positives, like record-low mortgage rates and much-improved affordability are offset by still high negative equity, tight credit conditions and continued uncertainty about the overall state of the economy.

Just 10 percent of those polled in the CNBC survey say the economy is good or excellent, with 91 percent saying it is only fair or poor. Fifty-three percent say it is poor, with 25 percent saying it will get worse. These sentiments are little changed from the survey results in June.

Housing still faces some huge unknowns, including tough regulation on mortgage lending, the looming “fiscal cliff,” and more than 5 million loans that are either delinquent or in the foreclosure process.

Supplies of distressed homes are low, but much of that is due to delays in the foreclosure process which are just now beginning to lift. New mortgage delinquencies are falling slightly, but they are still far higher than historical norms. (Read More: ‘Underwater Mortgage’ Refis Get Fresh Push in Congress.)

There is also a possible new headwind that few have mentioned. That is the potential loss of the Bush 2007 Mortgage Relief Act benefit.

This act negates any tax liabilities against borrowers who do so-called “short sales.” This is when the bank allows the home to be sold for less than the value of the mortgage. The debt that is forgiven (that is the amount of the mortgage not covered by the sale price) would usually be taxed, but this act put a temporary stop to that in order to give borrowers relief and stimulate the short sale market.

This act expires at the end of this year, and Congress has yet to extend it.

“Private investors, Realtors and banks have begun to drive short sales hard, as foreclosures take too long and are too politically sensitive,” said housing analyst Mark Hanson. “The loss of the Bush 2007 Mortgage Relief Act benefit, which has been driving incremental short sale volume all summer — and is responsible for a large part of the year-over-year increase in sales volume — will drive sales volume into a “triple dip” in the winter/spring…Prices will get hit as well.”

It is of course possible that Congress will extend the act at the last minute, but this is just one example of many “ifs” still present in the market.

Mortgage rates may be low now, but some say they could move up next year, influenced by factors outside the Federal Reserve’s recent attempt to lower them (QE3). (Read More: How Does the Fed Help My House My Mortgage?)

Home prices appear to be improving, but a new flow of distressed properties could lessen those gains this fall. And again, so much still depends on jobs. SP’s David Blitzer may believe housing is back, but his colleague Robert Shiller said last week that he wasn’t convinced. Suffice it to say, the housing market has come a long way, but it still has a long way to go.

—By CNBC’s Diana Olick

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Article source: http://www.cnbc.com/id/49163485?__source=RSS*blog*&par=RSS

SF property values rebounding

Sat, 25 Aug 2012 08:31:03 +0000

San Francisco property values, as seen through the prism of annual tax assessments, are showing strong signs of rebounding, according to Assessor Phil Ting.

Meanwhile, a separate report showed the number of underwater homes in the nine Bay Area counties slowly subsiding as values rise.

“It is starting to come back, there is no question,” Ting said. “San Francisco remains probably the strongest real estate market in the state.”

Throughout the housing downturn, San Francisco was a Teflon-coated county compared with the rest of California, with more moderate declines in real estate values than elsewhere. It was the only county in California that never saw its overall tax roll shrink during the downturn. For the 2012-13 tax year, the assessed values in San Francisco grew 4.17 percent, or $6 billion.

Commercial properties led the growth surge, particularly in emerging areas for biotech and technology firms: Mission Bay, the South of Market portion of the Financial District, and the Inner Mission.

“Even during this very challenging recession, we’re seeing (strength in) those markets driven by industries like life science, biotech and health care as well as tech companies,” Ting said.

Under Proposition 13, properties are reassessed by more than the annual 2 percent limit when they change hands, undergo significant renovation or are newly built. All three factors were at play in the surge in values in areas such as SoMa and Mission Bay.

Residential recovery

On the residential side, the recovery is more checkered, with weak areas particularly in the southeast and western parts of town.

Proposition 8, passed in 1978, lets assessments temporarily drop to match lower property values. Around the city, 15,811 properties got such reductions this year, averaging $175,980 in reduced value per home.

Ironically, Mission Bay, South Beach and South of Market – home to lots of new condos – were among the residential areas with the most Prop. 8 reductions, despite their boom on the commercial side.

“That whole cluster was heavily impacted and had the biggest overall declines in roll value,” Ting said. “They had a significant amount of new building, which created a bit of temporary oversupply.”

Lower-income areas, such as Bayview and Excelsior, continue to struggle.

“Those generally have been the softest real estate markets over the past couple of years,” Ting said. “They are entry points for the first-time home buyers. They were the first to show softness and the last to show strength.”

Meanwhile, perennially popular – and pricey – neighborhoods such as Pacific Heights, Noe Valley and Russian Hill saw assessed values rising.

“Areas that traditionally have been in high demand remain fairly strong,” Ting said.

Overall, Ting said, “I feel our recessionary recovery is U-shaped. We’ve definitely stabilized. It doesn’t feel like it’s jumping back in a sharp V shape the way it did in 2004 or 2005.”

Frothy market

Assessments look at property values as of Jan. 1, so this year’s exceptionally frothy real estate market is not yet factored in. But a report from real estate service Zillow showed that rising home values decreased the percentage of underwater properties between the first quarter and second quarter.

“It’s good news that negative equity is dropping, but we expect the overall recovery to be fairly slow,” said Stan Humphries, Zillow chief economist. “We are now mostly at bottom in most markets.”

Alameda and Contra Costa counties – two of the hardest-hit areas locally – saw significant changes in negative equity, which went from 33.8 percent of mortgaged homes in Alameda to 30.9, and from 42.8 percent in Contra Costa to 40.1.

“Besides a very healthy appreciation in home values, the high pace of foreclosure activity is also pushing negative equity down” in those counties, Humphries said.

That’s because once underwater homes are repossessed by banks and resold at lower prices, the new owners start out with equity through their down payments.

San Francisco stands out for having a relatively small pool of underwater homes.

“The big driver is that home values there are down just over 12 percent from their peak,” Humphries said. “That’s a very modest decline, which leads to a very low rate of negative equity.”

By comparison, Alameda values are down 37 percent from peak, Contra Costa almost 51 percent and Solano County almost 60 percent, he said.

Negative equity slowly subsides

The percentage of underwater homes, with mortgages larger than the value, decreased in every Bay Area county between the first and second quarters of this year.

Source: Zillow.com

Where home prices are rising

These neighborhoods saw the biggest increase in total assessments, which look at the values of all properties as of Jan. 1.

Source: San Francisco Assessor’s Office

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

Article source: http://www.sfgate.com/business/article/SF-property-values-rebounding-3814168.php

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 June Home Sales Fall in June

Tue, 31 Jul 2012 11:28:07 +0000

July 30, 2012 (Brian Michael)

Monthly sales of existing single-family homes and condominiums in the San Francisco Bay area fell from May to June but were still higher year-over-year for the 12th consecutive month according to real estate information provider DataQuick..

A total of 8,577 new and resale homes were sold in June in the nine county Bay Area, which includes Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Solano and Sonoma Counties. That was 2.6 percent lower than the 8,810 home sales in May but still 7.2 percent higher than the 7,998 sales posted in June of 2011. Year-over-year home sales have improved for 12 consecutive months.

Home sales typically increase from May to June in the Bay area with last month’s home sales 14.8 percent below their historical average.

Cash buyers accounted for 27.5 percent of the homes purchased for the month, down from 28.3 percent in May and they paid a median price of $277,000 for the homes they purchased, down from $280,000 the previous month.

Absentee buyers, usually investors and vacation home buyers, accounted for 23.4 percent of all sales, down from 24.4 percent in May, paying a median price of $270,000 for the homes they purchased, up from $262,000 the previous month..

The median sales price for new and resale homes and condos in June increased 4.3 percent to $417,000, up from $400,000 in May. The median price was 10.4 percent higher than in June of 2011, when the median price stood at $377,750. It was the third consecutive month that year-over-year home prices have improved in the area following 19 straight months of declines.

By comparison, the lowest median price posted during the current real estate cycle was $290,000 in June 2009, while the peak median price was $665,000 in June/July 2007.

John Walsh, president of DataQuick, stated, “Some of today’s stats are similar to what we saw in the thick of the housing downturn back in 2009, only in reverse: Instead of foreclosure resales soaring they’re waning, and instead of high-end sales slumping they’re posting some of the larger sales gains. This is one of the main reasons that various price measures are pointing higher – a so-called change in market mix. While last month’s jump in the median sale price might to some extent reflect prices edging a bit higher in certain markets, mostly it’s a reflection of the change in market mix. Fewer discounted distressed properties changing hands, more normal sales in the move-up range.”

Distressed home sales accounted for 36.1 percent of the Bay Area’s re-sale market last month, down from a revised 39.0 percent in May. Foreclosure re-sales accounted for 18.1 percent of all existing home sales in June, down from 21.4 percent in May, while short sales also made up about 18.0 percent of the Bay Area’s existing home sales last month, up from a revised 17.6 percent in May.

Tags: Bay Area, DataQuick, home sales, home prices, spring selling season, median sales price, new homes, re-sale homes

Source:
Dataquick

Article source: http://loanrateupdate.com/mortgages/bay-area-june-home-sales-fall-in-june

New Crop of Foreclosures Is Coming

Thu, 26 Jul 2012 05:00:43 +0000

While fewer Americans are falling behind on their mortgage payments, the huge backlog of already delinquent mortgages is finally making its way through the banking system to foreclosure.

Total foreclosure activity rose in the first half of this year from the previous six months, according to online foreclosure sale site RealtyTrac, driven by a jump in new foreclosure actions by lenders.

“Those foreclosure starts are welcome news for prospective buyers and real estate brokers in many local markets where a shortage of aggressively priced inventory has been holding up sales activity. Markets with increasing foreclosure starts will likely see more distressed inventory for sale in the form of short sales and bank-owned properties in the second half of the year,” said Brandon Moore, CEO of RealtyTrac.

More than half of the 212 metropolitan areas RealtyTrac surveys saw increases in foreclosure starts, and of the top ten foreclosure rates in the nation, five of them were in California. Stockton still holds the dubious distinction of the nation’s highest metro foreclosure rate, at more than three times the national average. Despite their high ranking, however, all of the California metros in the top ten actually saw decreasing foreclosure activity overall. In fact, Atlanta was the only metro area with a top ten foreclosure rate to see increasing foreclosure activity in the first half of this year.

While many of the previously hard-hit markets are seeing declines in foreclosures, other cities are seeing big gains. Foreclosure activity increased more than 20 percent from second half of 2011 in Tampa (47 percent), Philadelphia (30 percent), Chicago (28 percent), New York (26 percent), and Baltimore (21 percent).

Foreclosure activity dropped the most in Seattle, WA. Other cities where activity dropped more than 10 percent from the second half of 2011 were San Francisco, Detroit, Los Angeles and Boston.

New foreclosures, known as “starts,” rose in more than 60 percent of metro markets. RealtyTrac ranked the best markets for investing, by looking at where sales prices are increasing but foreclosure discounts are still at 15 percent or higher. Durham, NC, Boston, MA, Cleveland, OH and Phoenix, AZ all made the top ten.

Questions? Comments? And follow me on Twitter @Diana_Olick

Article source: http://www.cnbc.com/id/48324812?__source=RSS*blog*&par=RSS

San Francisco Bay Area Homes Continue to Slip Underwater

Fri, 11 Nov 2011 17:43:18 +0000

Homes around the Bay Area are continuing to slide underwater – the term for a home worth less than what is owed on the mortgage – according to a report from real estate research firm Zillow.
Nearly a quarter (24.6 percent) of homes in the nine-county area were underwater in the three months ended in September, Zillow said. That compares with 22.8 percent in the preceding quarter.

Several reasons underlie the declines: the end of the spring/summer peak home-buying season, continued malaise after last year’s expiration of home buyer tax credits, lack of consumer confidence.

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