Currently in Dublin, CA there are only 21 active detached homes available and 116 homes that are pending sale. Inventory is very low, with under a month’s supply. The price breakdown of active homes available are:
$350,000 to $500,000: 6 homes
$501,000 to $750,000: 11 homes
$751,000 to $1 million: 3 homes
Over $1 million: 1 home.
Average days on market for detached homes among all price ranges is 25 days. In short, the market is still red hot. On my listings in Dublin, I have commonly received 10 or more offers in the past few months. Why is inventory so low? Partly because many homeowners are still under water and cannot sell (unless they do a short sale), so they are keeping their homes off the market. In addition, banks still have not released a lot of their “shadow inventory” Other potential sellers are still waiting it out to see if the market continues to go up in hopes of maximizing their sale price. However, now is a great time to sell in Dublin, CA, and a great time to buy if you can secure a property.
The median price for a detached home in Livermore, CA as of Dec. 31st was $425,000. There were 134 active homes on the market, which represents about a 1.5 month supply. There was a 2.8 month supply a year ago in Dec. 2010. Average DOM in December 2011 was 45, down from 80 days in December 2010. Overall prices held relatively steady at $253/sq. ft in December 2011 compared to $258/sq. ft. in December 2010. The sale price/list price ratio was 97.45% in December 2011. Most listings are in the “sweet spot” of $300k to $500k. Overall the market in Livermore appears to be relatively healthy, with low average DOM, low inventory and high sale price/list price ratio. Just a personal anecdote, my listing at 881 Havasu Ct, Livermore, CA received 7 offers in less than a week. Another located at 6141 Forget Me Not, Livermore received 3 offers in a week.
However, there is a downside. Of the 905 detached homes sold in 2011, 217 were short sales and 186 were bank-owned. Together, this represents 45% of the market. Almost half of the sales of detached homes in 2011 were a distressed sale in Livermore, CA.
See below for stats, click to enlarge.
2011 finished fairly strongly with 29 single family homes sold in Dublin, CA in December 2011. As of December 2011 there was only 1.1 months of supply on the market compared to 2.1 months in December 2010. The average selling price was $565,000 or $264 per sq. ft. Homes sold at an average of 98% sale price/list price ratio. All of these signs point to a relatively healthy real estate market in Dublin. Combined with record low interest rates, homes are not staying long on the market, averaging 34 DOM. Many buyers are attracted by the relative affordability of Dublin vs Pleasanton and San Ramon, while still having access to newer homes, great schools, and great location close to freeways and shopping. See graphic below for detailed stats.
I list a lot of short sales, and it always puzzles me when an agent or buyer submits a lowball offer on a short sale, especially in desirable areas. I explain to them the short sale process, that the bank will perform a BPO (broker price opinion) or appraisal to determine the market value of the property. I also explain to them the banks want close to if not full market value for the property so ultimately it is a waste of time to offer something you know that will be rejected. From a listing standpoint, entertaining a lowball offer through the short sale process is dangerous because if that offer does not work out, you will have limited time to find another buyer before the foreclosure sale date. This is especially true now since banks are acting much more quickly to foreclose.
I understand buyers and their agents want to negotiate (I certainly do) but they also have to understand their offers have to be reasonable and the banks will not accept lowball offers. I will only submit an offer to the bank if it is reasonable since it is such a waste of time. The buyer may also get frustrated, thinking they will get a super low price, only to be rejected or countered by the bank. On the flipside, I also see banks countering reasonable offers to ridiculously high amounts. In one case, I was listing a house for $375,000 and the bank countered to $450,000! and this was after it was on the market for 6 months without any other offers! Overall both buyers and the banks need to get realistic about the prices in this market.
Freddie Mac has put out a great series of videos on You Tube that addresses the various myths surrounding foreclosure. These videos talk about things ranging from scams to watch out for to when you can buy a new home after a foreclosure or short sale. Freddie Mac is a major authority in the home financing market, so it’s great they have addressed some of the myths and false information out there. This information is relevent to any market whether you live in Dublin, Pleasanton, San Ramon, or Danville. Here is the video:
Almaden Valley in San Jose, CA is a great place to live and raise a family. Approximately 37,000 people live here, in the Southwestern part of San Jose. The reasons why people choose to make this area home are many. Among them are excellent schools, close proximity to world-class technology companies, and a family-friendly environment. Although this area is not immune from the housing downturn, it has weathered the storm better than many places. There are also many outdoor and recreation opportunities available. Check out the below video to learn more.
- Image via Wikipedia
I just received short sale approval on a home located in Los Altos, CA. This was one of the most challenging ones I’ve worked on because both the 1st lender (ING) and the 2nd lender (Citi) were demanding very high payoffs. ING was demanding $1.1 million for the property when clearly no one was willing to pay that much for it. To make it tougher, Citi was demanding a very high payoff of $60,000 on a $125,000 balance. This was originally being negotiated by an attorney before I received this listing. This attorney finally gave up on it.
Because of these high demands, multiple buyers walked on the deal. However, as the months rolled on and the 1st finally filed the Notice of Trustee Sale (NOT), both ING and Citi became much more cooperative. ING ultimately approved a purchase price of $990k and Citi approved a payoff of $26,500, about 20% of the balance. It makes you wonder, why weren’t they more cooperative in the first place? They could have closed several months earlier and received a higher payoff! Not to mention the revenue lost from almost a year of no mortgage payments.
I do have to give the banks credit for ultimately realizing a short sale is much better than taking the property back as an REO, but they still have a long way to go to if we are to truly put a dent in the foreclosure problem. After all of the government programs, if it still takes the banks almost a year to approve a short sale, how long will it take to get through this mess? Banks are stubbornly, even blindly holding firm to price demands that are unrealistic. This is especially true in high priced areas such as Los Altos, CA with jumbo loans and large equity lines. Let’s hope banks start becoming more cooperative, particularly with the higher balance jumbo loans.
The news seems to be getting worse on this whole mortgage mess. Who really owns the loans that are being foreclosed on? What does this mean for all foreclosures going on now? Check out the video: