The incredible soaring Bay Area home prices

Thu, 28 Mar 2013 01:02:22 +0000

Tuesday’s SP/Case-Shiller report underscored the rapid run-up in Bay Area home prices, showing that the San Francisco metro area — Alameda, Contra Costa, Marin, San Francisco and San Mateo counties — saw home prices surge 17.5% in January compared to a year ago. That outpaced the national run-up of 8.1 % and was second only to Phoenix.

For a detailed analysis of the numbers and what they mean for the Bay Area, click here.

Bidding wars and multiple offers are the new norm here.

Here’s a look at a San Jose house listed for $1,075,000 that sold for $1,120,000. Redfin agent Ashley Rabello said she had four offers within the first day of listing. The winning offer had no contingencies, a large percentage down, and was significantly higher than the asking price.

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Heavy action at all price points is new — and another harbinger of recovery.

“During the boom and bust, the lower-priced houses had the biggest percentage price increases and then the biggest percentage collapse,” said David Blitzer, chair of the index committee for SP/Dow Jones. That’s because the most-outrageous lending practices — subprime loans, liar loans, no money down — were more concentrated in the low end.

Case-Shiller tracks homes at three price tiers — low (under $383,942), middle ($383,9422 to $681,776) and high (over $681,776). “Until the boom, the three moved together; during the downturn, they spread apart,” Blitzer said. “Now they’re moving in sync again; it’s a sign the market is coming back to normal, behaving a lot less bizarrely than it did before.”

Carolyn Said is a San Francisco Chronicle staff writer. For insights and news on the real estate market, follow her on Twitter: @csaid

Article source: http://blog.sfgate.com/ontheblock/2013/03/27/the-incredible-soaring-bay-area-home-prices/

Low-End Housing Sees Higher Losses

Tue, 28 Jun 2011 14:19:20 +0000

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As I sit here, less than 24 hours from the next release of the much-followed monthly SP/Case Shiller Home Price Index, I’m confronted with all kinds of varying data and hypotheses on the future track of home prices.

Particularly interesting to me is a new breakdown, by Capital Economics (which watches our market from Toronto, Canada), on how prices are falling faster at the low end than the high end.

At face value I thought this was a no-brainer. Of course the low end is falling faster because that’s where the bulk of the foreclosures are, thanks to the subprime mortgage debacle, which of course targeted first-time and low-income buyers on the low end. I had no idea how large the discrepancy is:

“Since their 2007 peak, prices in the low tier have so far fallen by 45 percent compared with declines of 35 percent and 25 percent in the middle and high tiers respectively,” notes the report.

Even though most of the subprime distress has worked itself through the market, the pressure on the low-end continues because it is the low-end borrowers now who have the toughest entry to the oh-so-tight mortgage market. As the report reminds, proposed risk retention rules will likely mean a 20 percent down payment, which will price many borrowers out of the low end of the market.

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Article source: http://www.cnbc.com/id/43553459?__source=RSS*blog*&par=RSS

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The incredible soaring Bay Area home prices

Low-End Housing Sees Higher Losses