With 2012 well underway, there are very encouraging signs that the nation’s economy and job market are finally starting to gain momentum. If this trend continues in the months ahead, it bodes well for the recovery in housing – both here in Northern California and around the country.

The U.S. economy grew at a 2.8 percent annual rate in the final quarter of last year, according to figures released by the federal government this month. This level was a sharp increase from the third quarter’s 1.8 percent rate. And there are indications that the latest GDP figure could actually be revised higher due to wholesale inventories rising in December.

Even more encouraging for real estate is the fact that the labor market is steadily improving. Most analysts agree that in order to have a self-sustaining recovery in the housing market we must first have a significant turnaround in the job market. There are indications that could be happening at long last.

Initial weekly unemployment claims fell 15,000 to 358,000 in a new report by the Labor Department. An even better trend gauge — the four-week average — fell to its lowest level since April 2008, the period before the financial crisis. And the unemployment rate has fallen to a three-year low of 8.3 percent.

One other bullish indicator for the housing market is solid gains in the stock market, especially in the housing sector. The S&P index is up more than 7 percent so far this year (as of February 10) and up more than 16 percent since late November.

No one can predict, of course, where stocks go from here and it’s not unreasonable to assume they could continue to bounce around given the sovereign debt crisis in Europe. But the stock market gains certainly are helping all of our 401k portfolios and perhaps bolstering the confidence of potential homebuyers.

The housing industry has fared better than many stocks on Wall Street. While housing starts are expected to climb 15-20 percent this year, the stock prices for homebuilders themselves have spiked from 20 percent to as much as 134 percent since August, according to a recent story in USA Today.

“Talk is turning from when housing will hit bottom to whether it’s time to buy housing stocks and count on the sector to propel the economy again,” the USA Today said in its February 9 article Home builders and investors both see signs of a turn.

To be sure, the nation’s housing market is still facing a number of challenges from tight credit to glut of bank owned properties in many markets. And the recent $25 billion settlement by the nation’s biggest mortgage banks could spur more foreclosures in the near term.

In a speech before the National Association of Home Builders, Federal Reserve Chairman Ben Bernanke cautioned that, “We need to continue to develop and implement policies that will help the housing sector get back on its feet.”

Bernanke argued that overly tight credit in mortgage markets could be holding back a strong rebound in the real estate sector. He called on lenders and regulators to look at rules and practices that may hold back the origination of sound mortgages. He also has championed a plan to convert foreclosed homes into rentals.

But despite the challenges, there is good reason to believe the housing market is gradually turning the corner in many areas.

For most of the country, the inventory of homes for sale actually is falling while sales volumes have been picking up since last year. And affordability levels for homeownership have never been better, thanks to historically low interest rates and attractive home pricing.

We’ve seen the improvement right here in Northern California. According to a new report by the California Association of Realtors, January home sales rose 4.4 percent in the Bay Area when compared with the figures from last year. There was a 10.6 percent increase in Santa Cruz County, a 4 percent increase in Sacramento County and a 3.5 percent increase in Placer County. Prices did ease 8.2 percent in Monterey County.

We continue to see growing demand by very serious buyers looking to purchase homes. And while some are scouring the landscape for bargain basement distressed properties, many are seeking good homes at fair prices. And there continues to be a very strong demand for properties in the middle and upper ends of the market, too.

The real problem we’re facing here in the Northern California isn’t a lack of buyers; it’s not enough sellers.

Many homeowners who would like to sell their homes have been sitting on the sidelines, still wrongly believing that the market is in the depths of a recession. They still fear that they will have to take drastic price cuts in order to sell. I’m afraid that the news hasn’t gotten out to them that things have changed for the better over the past year or two.

Sellers no longer must sell their properties at fire-sale prices to get buyers’ attention. In fact, fairly priced homes that are staged well and located in desirable neighborhoods are not only being sold relatively quickly these days, but in some cases with multiple offers.

So if you’ve been thinking about buying or selling a home, there may not be a better time than right now. For buyers, mortgage interest rates are still below 4 percent for many 30-year fixed-rate loans and pricing is attractive in many neighborhoods. For sellers, there are scores of well-qualified buyers ready to purchase your home at reasonable prices.

No one knows what the future holds, but as the economy and the job market continue to gain momentum, there’s every reason to believe that the housing market will follow suit as well. Please contact me if you are thinking of buying or selling real estate.

Source: Coldwell Banker’s Reality Check

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What’s going on with the market these days?

A February 16 article from DataQuick, the San Diego, CA-based real estate information service states: “The median price for a (Bay Area) home fell year-over-year for the 16th consecutive month, as “distressed” sales rose to the highest level since early last year—”.   Statistics in the article show that Marin County bucked this trend, with a 4.6% increase in prices over last January’s results, and sales unit volume up 9.8%.

However, Marin’s own MLS year-to-date (YTD) statistics show these figures may be a bit deceiving. YTD single family residence (SFR) average sold prices are up  from last year’s YTD $848,172, to $960,535 as of February 14, while unit sales increased about 27%, from 132 to 168. Condominium sales, on the other hand, are down from 2011′s YTD figure of 63 units, to only 52 as of 2/14, off about 17%. This number actually represents a slight improvement  from our last report , when condo unit sales were off 20%. Condo year-over-year prices also down, with average sold price at $320,237 vs. 2011′s average YTD sales price of $349,992.

Regarding the current statistics, article quotes DataQuick President, John Walsh as saying “This is also the time of year we caution people not to try to read too much into the statistics. The winter numbers are based on a smaller pool of buyers and they haven’t proved very predictive.” That may be, but the reality is that right now, Marin County SFR prices and sales are up, and condo sales and prices are down— an important distinction and essential information for buyers and sellers. Current Marin County housing inventory continues to be extremely low. Percentage in contract on under-$1million SFR’s and condo’s is nearing 50%. Good, turn-key new listings are frequently going into contract quickly, often in their 1st week on the market and, not infrequently, for over asking price. Lots of all-cash deals are making it tougher for buyers who need loans, especially FHA or VA buyers, to land the properties they want.

Days on Market (DOM) for SFR’s down from last February’s 142 days to 133, while condo’s about the same as last year at this time at 153 days vs. last year’s 154. Sellers take note: Stale, overpriced properties that sit on the market while fresh, new, well-price listings zoom out the door skew these numbers to the high side.

Activity in local real estate offices is brisk and agents more optimistic than in quite some time, many thinking that 2012 will be the year the market starts to emerge from its slump. Time will tell!

Advice of an experienced local REALTOR who knows your neighborhood is invaluable in this market. Please call me if you are thinking of buying or selling!

Source: Fred Anlyn, The Anyln Report, Coldwell Banker, 2/17/2012

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When we celebrated the first Earth Day more than four decades ago, environmentally friendly “green” homes were considered the kind of thing that people who would buy hybrid or electric cars one day might own. But we’ve come a long way since then. Like hybrid cars, recycling and energy efficient appliances, eco-friendly homes are rapidly gaining in popularity.

More and more people are building green homes from the ground up. And those with existing homes are retrofitting them to make the property more environmentally friendly and energy efficient. Homeowners understand that making a home greener not only saves limited natural resources, but also saves them money in the long run and has proven to be healthier as well.

There are so many new products on the market that it has become very simple to increase the energy efficiency of your home – everything from compact fluorescent bulbs to low flow shower heads and a programmable thermostat. Most of these products can be installed in less than an hour, but their benefits can last for years. To get you started, here are a handful of tips to easily and affordably make your home greener and save you a lot of “green” in the process:

• Start by assessing your energy usage. Getting a handle on your home’s energy use is an important first step to improving efficiency. You can do a simple assessment using the online tools at ENERGY STAR, the organization run by the EPA and the U.S. Department of Energy. Go to www.energystar.gov. It will take just five minutes and you will need your last 12 months of utility bills. The site will provide guidance on home improvement projects to enhance energy efficiency, and even provide information on rebates and government tax credits
• Seal and insulate. Sealing and insulating the “envelope” or “shell” of your home — its outer walls, ceiling, windows, doors, and floors — is often the most cost effective way to improve energy efficiency and comfort. ENERGY STAR estimates that a knowledgeable homeowner or skilled contractor can save up to 20 percent on heating and cooling costs (or up to 10% on their total annual energy bill) by sealing and insulating
• Make your HVAC system more energy efficient. As much as half of the energy used in your home goes to heating and cooling. So making smart decisions about your home’s heating, ventilating, and air conditioning (HVAC) system can have a big effect on your utility bills. Change your air filter regularly. Tune up your HVAC equipment yearly. Install a programmable thermostat. Seal your heating and cooling ducts. Consider installing ENERGY STAR qualified heating and cooling equipment
• Install low-flow showerheads and toilets. Older toilets waste large amounts of water. More than 30 percent of indoor residential water comes from toilets. New, low-flow models now use less than a gallon of water per flush vs. five gallons on older models. You can also save water and money, and still have ample water pressure, with a low-flow showerhead, which can slash bathing-water consumption 50 to 70 percent.
• Use energy efficient lighting. Compact Fluorescent Light bulbs (CFLs) use 66% less energy than a standard incandescent bulb and last up to 10 times longer. Replacing a 100-watt incandescent bulb with a 32-watt CFL can save $30 in energy costs over the life of the bulb.
• Consider solar water heaters. A solar water-heating system can reduce the fossil fuel you’ll need for showering and washing clothes, and lower your utility bills in the process. But before installing one, determine whether you have a sunny enough location to recoup the up-front costs, which CNN Money says can range from $3,000 to $8,000.
• Choose healthier paints. Having a greener home is more than just saving energy. It’s also about the health of the home and protecting the environment. Conventional paints contain solvents, toxic metals and volatile organic compounds that can cause smog, ozone pollution and indoor air quality problems. These unhealthy ingredients are released into the air while you’re painting and even after the paints are completely dry. Opt instead for zero- or low-VOC paint, made by most major paint companies.
• Reuse and remodel. As CNN Money said in a recent article, “the house that you fix up will probably be much greener than anything you build in its place, no matter how cutting edge the new design or how much recycled material you use.” With a total tear down, everything that went into building the old house goes to waste. Construction material is one of the largest contributors to landfills. So reusing and remodeling is a good way to limit your impact on the environment.

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