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| Overall the number of active listings in San Francisco has stayed relatively steady, reaching its maximum during the summer and slowly falling during fall. The jump in mid-September coincides with about 300 new homes being put on the market after Labor Day.These charts came from our October 2010 Newsletter. Click for more complete information. |
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Posts Tagged ‘market charts’
Market Chart Series: October 2010 Update – For Sale Properties
October 6th, 2010 by Katy Dinner
How mortgage market has tightened
September 16th, 2010 by Katy Dinner
Arthur Brito has given up on the idea of buying a house because the qualifying process is so difficult for self-employed people like him. Credit: Kirsten Aguilar / The Chronicle
September 12, 2010|By Robert Selna and Carolyn Said, Chronicle Staff Writers
In 2006, Arthur Brito, a self-employed Bay Area landscape designer, and his wife were prequalified for a $625,000 home loan. After being priced out of the housing market by inflated values, they started looking again last year, but quickly learned that the mortgage crisis had changed their fortunes: They now qualified for a loan of only $280,000.
Brito’s experience illustrates how residential lending practices have shifted dramatically, from a market where high-risk buyers got loans far exceeding their ability to pay to one in which borrowers who are employed and have good credit and a healthy down payment may be out of luck.
“Financially, we are the same people as we were in 2006, so it’s pretty frustrating,” said Brito, 33. “Our incomes haven’t changed, but the rules have changed, so we don’t really talk about buying houses anymore. We’ve shelved it.”
Like Brito, many borrowers are suffering a housing loan hangover precipitated by historically lax lending standards.
In 2006, chicanery driven by avarice infected the mortgage industry food chain: Some mortgage brokers pushed risky loans, borrowers lied about their income, appraisers inflated home values, lenders originated shaky mortgages, Wall Street firms bundled them as securities and sold them, and ratings firms characterized them as safe investments.
At the center of this distorted world was the subprime loan, issued at a high interest rate to borrowers with tarnished credit, checkered employment history and little or no money in the bank. Wall Street firms such as Lehman Bros. traded in the lucrative high-interest loans, which yielded quick profits for brokers who sold them and lenders that originated them.
By 2005, the subprime market was $630 billion a year and growing – triple the $210 billion market in 2002.
Mortgage-backed securities create the liquidity that allow banks to originate mortgages, so they are not going away, but in many respects real estate lending has returned to its more traditional and conservative standards.
Higher standards
Borrowers generally need good credit, relatively large down payments, stable employment and a high percentage of income to debt to get a home loan. Dubious mortgages – with no money down, no documentation of income, adjustable rates that skyrocket after an introductory period – have largely gone by the wayside.
“The bottom line is that we have had a complete reboot of the mortgage lending system in this country,” said Keith Gumbinger, vice president at HSH Associates, a leading publisher of mortgage and consumer loan information…Read More.
Still catering to buyers in Marin
September 13th, 2010 by Katy Dinner
It’s pretty much a buyer’s market at the moment no matter where you go. Some areas of the Bay Area are less distressed than others; while they have seen price declines, they have not experienced a complete free fall in prices. Over the Golden Gate Bridge, Marin County is lucky to be one of those regions where the real estate market has and still continues to be corrected, but prices never got completely pummeled.
The county’s local paper, the Marin Independent Journal, writes that Marin is still a buyer’s market, though like every county, the market is very specific, depending on the city and community. Belvedere, one of the priciest communities in the Bay Area, if not the country, is having a tough time getting homes to change hands, where only 4% of the 48 homes that are listed are in contract. Like many high end towns with multi-million dollar houses, these palatial estates are sitting on the market longer and longer…Read more.
Federal foreclosure prevention program is struggling
September 11th, 2010 by Katy Dinner
Kevork Djansezian, Getty Images
August 21, 2010|By Jim Puzzanghera, Los Angeles Times
Reporting from Washington — Just as the housing market recovery has stalled, so has the Obama administration’s main program to ease home foreclosures.
Only 36,695 homeowners received permanently lowered mortgage payments in July through the much-criticized Home Affordable Modification Program, the smallest increase since December, administration officials said Friday.
And the number of people dropping out of the program continued to soar. Overall, nearly half the homeowners who entered the program since it launched in March of last year have dropped out.
Many had hoped the $75-billion program would be a silver bullet to the foreclosure problem, but it’s turned out to be a dud, said independent banking analyst Bert Ely. That’s not surprising, he said, given the depth of the housing market crash and recession, combined with a slow recovery.
“Even with a substantial reduction in mortgage payment and even some reduction in principal, you still have people who are over their head financially because of their reduced financial circumstances,” Ely said. “Isn’t it time to just rethink this whole business of modification … and let the market clear through foreclosures and short sales?”
The Los Angeles-Orange County area continued to have the most active trial and permanent modifications under the program, with 44,617 total modifications in July, or 6.6% of the national total. But that was down from 48,846 total modifications in June…Read more.
Essay writing skills a new mortgage requirement?
September 10th, 2010 by Katy Dinner
Earlier this week, a New York Times blog on personal finance wrote about the interesting (and somewhat odd) mortgage application process experienced by Linda Falcao and her husband. Seeking a mortgage through our Bay Area based Wells Fargo, the couple was asked to provide additional color and details about themselves and the home they wanted to purchase, through penning a “motivational letter.” In the real estate heyday, when sellers got multiple offers, it was not unusual for a bidder to craft a letter chronicling how much they loved the property, how excited they would be to see their kids grow up in the house, how well they would care for the place, etc. in hopes that they would be the winning buyer.
However, what was odd about the request was the information Wells Fargo was looking for.
Besides asking for information about their family plans, which was paired with questions about plans to change the “property size,” Wells Fargo also requested that the letter include information that supported the fact that the property, in Glen Mills, Pa., would be their primary residence. The bank also asked them to include their commuting distances to work, as well as other properties that they may own in the area. The request for the so-called motivational letter was included in the bank’s mortgage commitment letter, which offered to approve their loan if they answered the bank’s questions and provided other documentation.
As the blog notes and as one can tell, some of the questions are reasonable but some are crossing the legal line.
[B]asing a loan decision on a borrower’s family status or future plans is…against the law. It violates the Fair Housing Act,… which prohibits discrimination in lending based on disability, sex or family status – including pregnancy or having children in the family.
This blog brought up memories about my own recent mortgage approval process just a couple of months ago. Last spring, when I was laid off after my maternity leave, I enjoyed the subsidized time off with my newborn before taking on another full-time role. In our application process, our mortgage broker asked me to write a statement explaining my brief absence from the grind. I first wrote a straightforward two sentence statement saying I was laid off but went back to work in the beginning of the year. He came back and suggested that the statement be longer, provide more color and personal details…Read more.
Market Charts: Median Sales Price for Houses in SF
August 31st, 2010 by Katy Dinner
Median Sales Price for SF Houses: for the week ending August 15th, the median sales price was almost exactly the average median over the past 6 months.
Market Charts: Percent of Listings Accepting Offers
August 30th, 2010 by Katy Dinner
This is a weekly chart, so there will be more fluctuations. Nonetheless, homes Accepting Offers has been relatively stable over the last 6 months.
Market Charts: Past 3 weeks, more listings expiring or being withdrawn than closing escrow
August 28th, 2010 by Katy Dinner
Sold Listings vs. Expired/Withdrawn Listings:
5 Reasons Why You Should Buy a Home Today
August 26th, 2010 by Katy Dinner
by STEVE HARNEY
Homeownership almost seems like a dirty word in today’s society. People are blogging, tweeting and facebooking their belief that buying a home is just plain stupid. I respect their opinion on the issue though I totally disagree. Why?
This might be the best time to buy a home in American real estate history.
Some might think I’m crazy. Cynics might think that I am saying this because I still hold a real estate license (though I have not listed nor sold a home in ten years). My reason for saying it is actually quite simple. Owning a home makes more sense than not owning a home for the vast majority of families in this country. Let me give you five reasons why.
1. Real Estate is a Great Long Term Investment
Don’t take my word on this. This is what Mike Mandel, former chief economist atBusinessWeek and current Senior Fellow at Wharton’s Mack Center for Technological Innovation, had to say:
We’ve just had the biggest boom and bust in real estate in recent history. Nevertheless, real estate has still greatly outperformed the stock market over the past ten years.
Below is his chart actually showing the difference between real estate and the stock market.
2. A Home Is a Better Place to Raise a Family
Don’t take my word on this. When Fannie Mae asked current renters for the major reason to buy a house in their National Housing Survey 2010, these were the answers renters gave (they could pick multiple answers):
- 78% said it was a good place to raise children
- 75% said because they would feel safe
- 70% said because you have control of your own space
3. A Home Creates a Sense of Community
Don’t take my word on this. The Federal Reserve Bank of New York just published a paper The Homeownership Gap. The paper explained:
Because owners have a financial interest in their property, they have incentives to take measures that will maintain or increase the value of that property. Some of these measures—such as fixing a leaky roof—are closely related to the house itself. Others, such as investing resources in the betterment of the neighborhood and the community, have broader beneficial effects on the local area, creating what economists call “positive externalities.”
Market Charts: New Listings Coming on Market Slow
August 26th, 2010 by Katy Dinner
As is typical. Usually the next big rush of new listings occurs after Labor Day.
