In another sign that the US economy is turning the corner, the San Francisco housing market has almost instantly become hot.
Bay Area CBS News 5 reports "there are now signs of a serious real estate rebound in San Francisco." Their news story headline? "Mini-Boom."
"This is not some kind of spin from the real estate brokers. We absolutely have hard numbers to back this up," claims reporter Hank Plante of News 5. "In the last 2 weeks in San Francisco there have been more homes sold than in the previous 6 months."
One 40-year veteran agent claims he has never seen activity like he saw last week. On one home alone he received 42 offers. That house sold for $100,000 over the listing price.
Another house in the same neighborhood had 10 offers on it. It was listed for $525,000 and just sold for $608,000. And Plante reports several more examples of almost instant sales in this resurgent market with none of the examples being foreclosures.
Real estate expert Brendon DeSimone claims that evidently, "buyers have been waiting, they've been saving their money and waiting. The foreclosures have come and driven the prices down. With affordable monthly payments now, buyers are coming back in."
With those low prices, "pent up demand has now been unleashed, even at the high-end," continued Plante. For instance, waterfront real estate developer Alan Mark describes their "amazing run since the beginning of the year. We've had 50 [high-end waterfront condo] sales in 2009 and 30 in the last 30 days."
We'll add this incredible observation to our growing list of strong recovery signs.
(Thanks to an Anonymous reader for pointing us to this good news story)
Tuesday, March 17, 2009
San Francisco Housing Market Instantly Hot
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http://www.newmogul.com/item?id=7196
ReplyDeleteAlt-A and Option ARM Resets have yet to hit us. Recovery is not here yet.
Anonymous,
ReplyDeleteYour post and the video report you link to misses at least 5 very important factors.
1) Many Option ARM resets have already occurred.
2) As a condition for their bailouts, big banks are agreeing to work on terms that homeowners can afford rather than foreclosing under the exact terms of the contracted reset.
3) Many Option ARM resets will be just fine (and in fact better). Indexes used to adjust these mortgages are at historic lows. Many folks are now reporting that they will adjust to a lower payment, not higher.
4) Many Option ARMs were combined with HELOCs to provide 100% financing. These HELOC rates are now also at historic lows, freeing more monthly income to pay on the first note.
5) The "produce the note" movement. Many big banks are no longer able to produce the note associated with the mortgage. This movement is shackling banks from foreclosing and forcing them to negotiate with homeowners for a lower payment rather than foreclose.
But currently given the low indexes most ARM Resets are a positive event for homeowners.
No post here as claimed (yet) that we have returned to growth. But we now have more evidence than ever that the July 4th mark (called way bank in Nov by one of our quoted level headed senior economists) is still a great bet.
(See Dire Commentary Overblown and More Strong Recovery Signs in the archive to the left)
GNE
GNE:
ReplyDeleteCan you comment on some of the dire predictions about the commercial real estate market and the belief by some bankers that the US Govt. will have to spend trillions of new TARP money to deal with all the foreclosures, etc that will impact the big banks? Any sign that the commercial real estate market is stablizing?
Anonymous #2,
ReplyDeleteI would simply make many of the same points that I raised above. More specifically most savvy businesses that are holding notes for commercial real estate are looking at refinancing at much lower rates. The action by the fed just today will make that even more attractive to commercial entities to pursue such action.
Look for mortgage rates starting tomorrow to be significantly lower...
Bottom line: dire predictions about the demise of the comm real estate market are significantly overblown.
GNE
I had a great time reading around your posts as I read it extensively.
ReplyDelete