The real estate market has moved into the winter months and is experiencing slower sales and slightly lower prices. Single-family home sales dropped by 16 percent from April-June to July-September this year. The average price for single-family homes has remained relatively constant: $746,624, $269 per sq.ft., and market time ranging from 70 to 90 days. Home sales are expected to slow during November and December. Home buyers will continue to bully homeowners for lower prices than previous comparable sales. Today's buyers do not have the “I have to buy now” mentality. Their motivation is different than it was during the boom years. The record low mortgage rates are not causing buyers to start madly bidding on homes. And with the current seven-plus months of inventory, there is no shortage of available property. The 2010 winter real estate market will see slower sales, higher market-time and slightly lesser prices.
Chief economist of the National Association of Realtors Lawrence Yun argued in October's Realtor Magazine that jobs are needed to spur home sales. Not lower mortgage rates or tax credits. He cited areas such as Houston and Washington D.C., where jobs are growing, that “pending sales contract numbers remained healthy in August, despite the absence of the tax credit.” But even so, we may see lower mortgage rates. In October, averages mortgage rates jumped down as low as 3.875 percent, fueling ideas that mortgage rates could move into the lower 3 percent range. In a September meeting, the Federal Open Market Committee talked openly about a second round of 'quantitative easing'. This means the Fed will continue to purchase treasuries and put more money into the markets. The Fed's intervention into the markets has translated into ultra-low mortgage rates. The question raised in the Wall Street Journal's September 29 article: “No-Interest Mortgages? No Chance” was the idea that current record-low mortgage rates could theoretically go as low as zero percent with government intervention.
Attached home update
The most recent sales of Carlsbad condos and townhomes are showing fewer sales and lower final sales prices. 2nd quarter sales are were as follows: 153 closings, average sales price at $389,881, $277 a sq.ft and an average time-on-market of 76 days. From July to October the number of sales slowed by 28 percent to 110 total sales with an average of $356,553, $237 a sq.ft, 82 days on market. These numbers do not include new construction sales. As of October, Condo and townhome sales are expected to slow further and small price declines are expected over the next three months. This is predicated that the current inventory levels and sales pace remains constant. A drop in average mortgage rates to 3.5% could spur demand for attached property, as the investors could then more attractive returns.
Get ready for short sales
Bank Of America's Portfolio Retention Manager, J. Allen Sellenbinder, hosted a private gathering of top industry professionals involved in the foreclosure and short-sale market in San Diego. Sellenbinder's mission was to spread the good word that Bank Of America is hiring extra staff to better handle their non-performing assets (defaulted mortgages). The goal is a more streamlined short-sale process reducing the workload of the average negotiator with 600 files to around 100. Since Fannie Mae is adopting a 12-month deadline for short-sale approvals with only one extension, Servicers like Bank of America and Wells Fargo have a vested interest to speed up the process. Sellenbinder expects short-sales to become a larger part of the distressed home market, as it is less expensive for the lender and more advantageous for the defaulted homeowner. A short-sale is when a homeowner who owes more than their home is worth negotiates with the bank to accept less than is owed. For more information on short-sales or to see if you can qualify for a short-sale email [email protected]
Chief economist of the National Association of Realtors Lawrence Yun argued in October's Realtor Magazine that jobs are needed to spur home sales. Not lower mortgage rates or tax credits. He cited areas such as Houston and Washington D.C., where jobs are growing, that “pending sales contract numbers remained healthy in August, despite the absence of the tax credit.” But even so, we may see lower mortgage rates. In October, averages mortgage rates jumped down as low as 3.875 percent, fueling ideas that mortgage rates could move into the lower 3 percent range. In a September meeting, the Federal Open Market Committee talked openly about a second round of 'quantitative easing'. This means the Fed will continue to purchase treasuries and put more money into the markets. The Fed's intervention into the markets has translated into ultra-low mortgage rates. The question raised in the Wall Street Journal's September 29 article: “No-Interest Mortgages? No Chance” was the idea that current record-low mortgage rates could theoretically go as low as zero percent with government intervention.
Attached home update
The most recent sales of Carlsbad condos and townhomes are showing fewer sales and lower final sales prices. 2nd quarter sales are were as follows: 153 closings, average sales price at $389,881, $277 a sq.ft and an average time-on-market of 76 days. From July to October the number of sales slowed by 28 percent to 110 total sales with an average of $356,553, $237 a sq.ft, 82 days on market. These numbers do not include new construction sales. As of October, Condo and townhome sales are expected to slow further and small price declines are expected over the next three months. This is predicated that the current inventory levels and sales pace remains constant. A drop in average mortgage rates to 3.5% could spur demand for attached property, as the investors could then more attractive returns.
Get ready for short sales
Bank Of America's Portfolio Retention Manager, J. Allen Sellenbinder, hosted a private gathering of top industry professionals involved in the foreclosure and short-sale market in San Diego. Sellenbinder's mission was to spread the good word that Bank Of America is hiring extra staff to better handle their non-performing assets (defaulted mortgages). The goal is a more streamlined short-sale process reducing the workload of the average negotiator with 600 files to around 100. Since Fannie Mae is adopting a 12-month deadline for short-sale approvals with only one extension, Servicers like Bank of America and Wells Fargo have a vested interest to speed up the process. Sellenbinder expects short-sales to become a larger part of the distressed home market, as it is less expensive for the lender and more advantageous for the defaulted homeowner. A short-sale is when a homeowner who owes more than their home is worth negotiates with the bank to accept less than is owed. For more information on short-sales or to see if you can qualify for a short-sale email [email protected]