Check out these stats below:

Marin County Active Inventory

April 2010                   1,606

April 2011                   1,396

April 2012                      624

Between 2012 vs. 2010 – 61% decrease

Between 2012 vs. 2011 – 53% decrease

(Average Sales Price is +3.2% vs. year ago, -7.4% vs. 2010)

If you are thinking of putting your house on the market, now is a great time! Please call me for a free home valuation.

From entry-level homes to the luxury estates, the Bay Area’s housing market gained more momentum in March, according to a number of recently released industry reports.

March home sales in the region were at their highest level for that month in five years, the result of lower prices, low interest rates and an improving economy, according to DataQuick, the La Jolla-based real estate research firm.

Some 7,694 new and existing houses and condos sold in the nine-county Bay Area in March, up 34.9 percent from February and 9.1 percent from March 2011, DataQuick reported. Last month’s sales total was the highest for the month of March since 8,317 homes were sold in 2007.

The strongest sales gains were in Solano, Sonoma, San Mateo and San Francisco counties with 13.2 percent, 12.1 percent, 11.4 percent and 11.3 percent increases, respectively, from March 2011.

“This is the time of year when buying patterns usually start to normalize,” said John Walsh, president of the research firm. “And while the changes we’re seeing are incremental, they’re incremental in a positive direction.”

Having said that, DataQuick cautioned that there continue to be potential bumps along the road to a normalized market. Walsh said he’s watching closely the number of distressed properties coming onto the market, as well as the ready availability of mortgage financing – or a lack thereof.

The median price paid for all new and resale houses and condos sold in the Bay Area last month was $358,000, according to DataQuick. That’s up 10.2 percent from February, and down fractionally from $360,000 in March 2011. The decline on a year over year basis was the smallest since October 2010.

The luxury end of the market also turned in a strong performance in March:

• In Marin County, both sales and the median sale price of million-dollar homes rose. A total of 48 high-end properties changed hands, up from 44 in February and 33 in January. The median sale price of a luxury home also soared 15.3 percent from the previous month to $1,525,000.
• In Silicon Valley, 110 homes sold for more than $1.5 million in March, nearly double the 58 transactions in February and up from 86 in March 2011.  Of the total sales, there were 50 multi-million-dollar transactions compared to 36 sales over $2 million during the same period a year ago.
• In the East Bay, luxury sales soared 23 percent from a year ago and more than doubled February’s totals. Some 111 million-dollar properties changed hands, up from 49 in February and 90 in March 2011.
• And in San Francisco, a total of 55 homes sold for more than $2 million during the first quarter of 2012 compared to 50 sales during the same period a year ago. At the same time, the median sale price rose 2.7 percent from last year to $2.8 million.

The market will continue to face some headwinds in terms of the economy, distressed properties and even mortgage financing.  And it’s likely that the economies of Europe and China will continue to factor in to our recovery.  But it’s clear that locally, we are headed in the right direction regarding housing. Our biggest challenge isn’t a lack of demand; it’s not enough homes to sell. So if you’ve been thinking about listing your home, there couldn’t be a better time than now.

Source: Coldwell Banker’s MarketWatch

In a recent news report on NPR, reporter Yuki Noguchi said the mild spring has brought buyers out earlier than usual, and real estate agents are busy around the country. Lawrence Yun, chief economist for the National Association of Realtors, told NPR that he is much more encouraged than he was one or two years ago. “The recovery seems much more broad-based,” he said. “Whether one goes East Coast — Boston, [or] to the West Coast — Seattle, sales activity is solidly higher.” And smaller markets like Peoria, Ill., Greenville, S.C., and Chattanooga, Tenn., are also doing better, Yun said.

But the single most telling number on the health of the market, according to Yun, is housing inventory. Home listings are down 26 percent from last year at this time, which the economist said is close to healthy market levels. While some market followers worry that we could see another wave of foreclosures, depressing home prices, Yun says that so-called shadow inventory of homes in serious delinquency or in the foreclosure process is also down. “So all three buckets of inventory … are falling, which is implying that this is a genuine reduction in inventory across the board,” he told NPR.

Here in the Bay Area we’re experiencing an even sharper decline in housing inventory. From Marin County, San Francisco and the Peninsula down to San Jose and out to parts of the East Bay, the number of homes for sale is down as much as 50 percent. This at a time when the number of well-qualified buyers eager to purchase appears to be higher than it has been in years.

While this rebalancing of supply and demand is good for the overall recovery of the housing market and firming up soft home prices, it is understandably frustrating buyers who are competing for the relatively few good, well-priced homes on the market today.  The strong demand is leading to multiple offers on many if not most homes in certain communities with prices going for much more than the asking price in many cases.

With our local economy continuing to bloom, especially in Silicon Valley, there is no end in sight to strong buyer demand. In fact, the latest UCLA Anderson economic forecast noted that growth in the San Francisco Bay Area region continues to outpace the nation, led by the technology sector.  Add to that the recent IPOs and upcoming Facebook offering and you can see where demand is heading.

I think word is gradually starting to get out to sellers that the financial crisis and corresponding housing downturn are finally over and it’s time to jump back into the market. We’re slowing seeing more listings starting to come into our local offices. My hope is that even more savvy homeowners will decide to sell as the spring housing market comes into full bloom. If so, it could turn out to be a beautiful season for the Bay Area market.

Source: MarketWatch, Coldwell Banker

Buffett said he believes purchasing a home with today’s historically low mortgage interest rates and holding it for the long-term has actually become a better investment than stocks right now. This is from someone who has always put stocks above all other investments! In his annual letter to shareowners, Buffett wrote, “Housing will come back, you can be sure of that.”

In explaining his investment picks and pans, Buffett said he would shy away from gold and treasuries, the latter of which he said will not keep up with inflation, particularly after taxes. Instead he said he prefers to put his money into investments that he considered to be “productive assets.” Within this category are stocks and real estate.

According to the Buffett, real estate and stocks not only boast the greatest upside potential, but also are safer investments in the long run than treasuries and gold.

In a recent interview with the International Business Times, Buffett forecasted an increase in household formations as the economy continues to recover. He believes that more people who moved in with their parents or in-laws during the recession will soon look to move out and get their own home soon.

According to the International Business Times, the annual pace of housing starts in the U.S. last year was just 609,000 – far less than the household formation of 1.14 million. Eventually, this imbalance will absorb the oversupply in the housing market, Buffett said, although how long this process takes could vary widely among various local U.S. housing markets. “Demographics and our market system will restore the needed balance – probably before long,” he said.  No one knows for sure what the future holds, but I agree wholeheartedly that if you’re looking to invest in a home for the long term you couldn’t find a better time.

On a related note, sales of existing single-family homes in the Bay Area increased by 10.7% in February compared with a year ago, according to a report released Friday by DataQuick, the La Jolla-based real estate information firm.

This marked the biggest increase for February in five years, according to DataQuick, and the eighth straight month of year-over-year sales increases for the Bay Area.

One last item of interest:  Remember just a year and a half ago when consumption and spending seemed to be at an all-time low?  There were articles appearing about a possible trend in renting versus buying.  Just two weeks ago, The San Francisco Business Times took a poll, asking readers if “renting is the new American Dream.” Despite the challenging housing market in recent years, homeownership still won by a wide margin. Some things never change!

Source: Rick Turley’s Market Watch, Coldwell Banker

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

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

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.

There are lots of reasons to own versus rent a house, but it depends on a variety of factors. To begin the thought process, I recommend that potential buyers consult with a mortgage broker to see how monthly rates offered by different loan programs compare to monthly rents. Currently, historically low mortgage rates and affordable housing prices make right now an opportune time to buy.

Buying a home largely depends on your lifestyle and current income. Qualifying for a loan and the down payment are oftentimes the two biggest hurdles that buyers face. The next question to ask is how long do you plan to live in the house? Given the difficult economic times, I recommend to buy and own a home for at least a 3-5 year period of time. The forecast is that the next few years will see slow growth. Transactional costs are expensive, real estate is not a liquid asset, and prices may appreciate or depreciate. Buying a home requires thoughtful contemplation.

Overall though home ownership’s benefits typically outweigh the option to rent:

• Tax Deductibility—You can deduct the cost of your mortgage loan interest from your state and federal income taxes. Since interest generally will account for most of your payment during the first half of your mortgage, the savings can be significant. Some of your costs at the time of closing (including prepaid mortgage interest) can be taken as deductions on that year’s income tax return, and points paid up front at the time of closing represent additional mortgage interest and may be taken as a deduction.
• Tax Deductibility of Property Taxes—You can deduct all of the property taxes you pay.
• Appreciation Potential—Real estate is considered a strong long-term investment because it usually appreciates in value. The effects of borrowing potential can increase as the value of the home appreciates.
• Capital Gains Exclusion—When it’s time to sell your home the amount of capital gains you have to pay is reduced. A homeowner can exclude up to $500,000 per couple if married and filing jointly, or $250,000 if single or filing separately for homes that have been the taxpayer’s principal residence for the previous two years.
• Capital Gain Treatment—Congress allows preferential tax treatment on gains from capital assets held for more than one year. This would be important for a homeowner who has gains in excess of the allowable exclusion.
• Principal Accumulation—Mortgages are designed to pay the interest for the time that the money has been used, as well as to retire the principal debt over a period of time. This payment plan means that part of the payment each month is for principal accumulation.
• Personal Enjoyment—Pride of ownership is a valid reason for wanting to own a home. You can personalize your home while enjoying the financial benefits. Usually a home provides a larger living indoor and outdoor space than renting with a limited use of space.

If you are thinking of buying a house this year, please contact me to discuss your options. I can also provide the name of a few mortgage brokers to you as well. Good luck and happy house hunting!

Economic growth is expected to be no greater than 2 percent through the end of 2012 – a growth rate that makes the economy very vulnerable to any external shock that could trigger a downturn, according to Fannie Mae’s Economics & Mortgage Market Analysis Group.

External factors, coupled with uncertainty surrounding the degree of domestic fiscal austerity, including the scheduled expiration of various tax cuts and unemployment benefits, and the impact of forthcoming regulations, will determine how fast the economy will grow.

“There’s been a little seasonal cyclical pickup in housing activity recently, as spring and summer sales are generally stronger than fall and winter, but leading indicators point to housing sales bouncing near the bottom at least through the end of 2012,” said Fannie Mae Chief Economist Doug Duncan.

“Home prices are a key factor for any positive movement in the housing market, and the large inventory of distressed homes working their way through the market is putting downward pressure on prices. Now that we are entering a traditionally weak seasonal sales period, we expect home prices to show renewed declines after firming for several months,” Duncan stated.

For more information, click here.

By price point, not much has changed since the beginning of this year. The low end of the market place remains in a seller’s or neutral market, and the high end of the market ($1.5 million and above) remains in a buyer’s market.

Below are two charts that provide an overview of the market conditions for the past three months. For example, the market is in the buyers’ favor if they are looking in the $1.5 – $2 million dollar range. However, if they’re looking in Greenbrae, they’re looking in a seller’s market since demand is very high there right now. It is also interesting to note that typically the more days on market, the lower the selling price. The towns that are in a seller’s market have a much closer listing price and selling price.

Opportunities abound in real estate right now (low prices, low interest rates) but a variety of factors come into play when you’re deciding where to buy or when to sell. I strongly recommend that a seller or a buyer carefully review the sales of homes by price point and town in order to negotiate the best price possible given the market conditions.