Silicon Valley and FHA loans..

Home prices are pretty high in the Silicon Valley.  Here, where sometimes wages are comfortable and disposable income or savings pretty low, it is good to remember that it is still possible to purchase a home with as little as 3.5% downpayment. 

How is it possible? with an FHA loan, which is an (almost) normal loan, guaranteed by the Federal Housing Administration.

How does it work? Well it is fairly easy in fact - there are few limitations: the buyer does not have to be a first-time home buyer, there is no limitation of income for the buyer, and the property purchased can be pretty much any price.  The loan amount is limited to about $730,000.

So I like to remind my clients of this option if they have little savings or family help for the downpayment, or if their salary is modest: they can still think in terms of homeownership while prices and interest rates are low.  It is quite a good loan, with an attractive interest rate (at or slightly lower rate than a normal conventional loan).  It is a little more expensive to get: there is a 1% upfront fee for the mortgage insurance and a fee of about 1% every year on the amount of the loan.  Note: If it is used to purchase a condominium, the complex has to be FHA approved.

If you know someone who wants to take advantage of such a loan program let me know: I will share names of lenders who know FHA loans well.  Time is also important: the loan limit will go down on October 1st to $625,500. 

Thanks for reading, and sharing!
Francis Rolland
- Since 1985

Silicon Valley real estate
Search for homes in Los Altos

A link of interest:  American Legion Santa Clara Post 419

Mountain View prices: condos vs houses

To piggy back on my last blog, it is definitely interesting to research and compare how different areas within Mountain View (or any City for that matter) may have fared in the past 4 years, whether in the condominium market or the house market.  But how did houses fare vs condominiums?

It turns out that they did about the same:  from the average price in 2006 to the average price in 2010, condominiums lost 4.4% in value, while houses lost 3.4%  - a close contest.  The only thing one can see is that the condominium market went down faster than the house market in 2008 - in average figures... not in median figures.

It mirrors fairly closely what the County of Santa Clara experienced.  Are you curious about your area?  Let me know I am curious too.

Francis

Silicon Valley real estate

A link worthy of interest:  Community Services Agency

How do you search for a home in Mountain View ?...

How do you search for a home in Mountain View ?...

There are plenty of search engines that will help you search for a home online, (i.e. see at the end of this post), but the first step is often to know where in town you would like to be ideally. Most areas in Mountain View are associated with a name, and there is an app for that – I mean a map for that, in the “Neighborhoods” publication of the Mountain View Voice. It looks like this:



Just click on it to see it in more details.

MLS areas, used by real estate agents, function somewhat in the same manner, so that for instance it is easy to look for properties, say, on the North of Central expressway, or downtown, or in “Cuesta Park”… you can mix that with other criteria like: schools, age, size, etc… there are more than 300 criteria to search by in the MLS. So, when the time comes to really look for your dream house, it makes sense to work with a professional who knows his (MLS) tools and areas.

I love it when asked questions like “which area appreciates most” or “lost most value”. It is absolutely possible to check this out, but it just takes time, and you need to know exactly what type of property you are researching. Curious about a specific neighborhood? Let me know.

Thanks for reading.

MLS search in Mountain View, CA
Home statistics – Silicon Valley

A link worthy of interest: http://www.ourbrothershome.org/

Median prices: a perspective - California vs local. Mountain View

Single family residences:
 
California median home price: February 2011: $271,320 (Source: C.A.R.)

California highest median home price by region/county February 2011: Marin $632,580 (Source: C.A.R.)

California lowest median home price by region/county February 2011: Merced $117,270 (Source: C.A.R.)

Santa Clara County median home price in March: $ 567,500,
Mountain View median home price in March:       $ 880,000
Los Altos median home price in March:                $ 1,595,500
Palo Alto median home price in March:                $ 1,564,000
(A lot) More Cities and details at:   Santa Clara County  and San Mateo County
 
Thanks for your interest!
Francis
 
Silicon Valley real estate.
Search the MLS from the comfort of your home.

Santa Clara County real estate pulse... + notable fundraising event

The average price for a house in the Silicon Valley (Santa Clara County to be more precise) went up a whopping 14% when compared with the month of February (to ~ $767K), and about 3.6% over what it was a year ago. (note: this is "average", not "median").

There is a graph, published every week in the San Jose Mercury News real estate section, that shows that about 34% of houses sell for more than list price in the County.  How can it be, one wonders?

Some of it is, for instance, in what happened to one of my clients recently when placing an offer of an REO (= real estate owned; or in other words, a foreclosure): there were 7 offers, and of course the sales price is going to be higher than the asking price.  We have a very enviable situation in our area, in that investors and homeowners alike see value in the Valley, and when prices are low enough, they buy.  Also, there is quite a bit of money in the Valley.  As a consequence, property values are quite sustained, and in the best areas the market is competitive - a sellers' market.


For single family homes - 3-month moving average.

Coming soon near you:  Craft Faire: an exciting fundraising event for our veterans programs. The event will have about 40 crafters indoors and outside at the American Legion Hall, 958 Homestead Road, Santa Clara. The hall is located just a few blocks from El Camino and is near the corner of Lafayette & Homestead. The event will be held on April 9th from 9 a.m. to 4 p.m.

Thank you for reading!
Francis

Silicon Valley real estate.

A few "fast facts" - on local real estate

The inventory of available homes in the area is a sure sign of where prices are going.  Lack of inventory = trends up in prices for the most part.
For the County of Santa Clara, available homes and condominiums combined are as follows, as of March 21, 2011:
2008 = 6899 homes. 2009 = 5979.   2010 = 3467.   2011= 3501.
For the area comprised of Menlo Park, Palo Alto, Mountain View, Los Altos and Los Altos Hills, the figures are as follow:
2008 = 392 homes.  2009 = 685.  2010 = 483.  2011 = 369
This latter figure explains why, currently, about half of the homes offered in Palo Alto receive multiple offers and prices are going up as a consequence.  What I experience is that the best products for sale right now are very much in demand, and based on the number of offers on some of these properties for sale, there are a lot of people in a position to buy "right now".  On the other hand, those properties that are not particularly attractive for some reason or another can linger a long time on the market. Now more than ever quality & desirability rule.

On an other front, according to C.A.R.’s February sales and price report, the median price of an existing single family residence declined about 2.5 percent year over year (California Association of Realtors).  Go figure...
Calif. median home price:
Calif. median home price: February 2011: $271,320 (Source: C.A.R.)
Calif. highest median home price by region/county February 2011: Marin $632,580 (Source: C.A.R.)
Calif. lowest median home price by region/county February 2011: Merced $117,270 (Source: C.A.R.)
- Mortgage rates:   Week ending 3/10/2011 30-yr. fixed: 4.88 Fees/points: 0.7% 15-yr. fixed: 4.15% Fees/points: 0.7% 1-yr. adjustable: 3.21% Fees/points: 0.5% (Source: Freddie Mac)


Thank you for reading.  Let me know if you need specific statistics on your neighborhood.
Francis Rolland
Dir: 650-947-2259
 
MLS search
Local trends and statistics
Silicon Valley real estate resource

Short sales in California: fewer than 3/5 close ...

I find it difficult to explain to potential buyers the difficulties that short sale situations pose.  A lot of the time, I give a copy of an article or two describing the problems involved.  - and there are many, many different types of problems.

The California Association of Realtors (C.A.R.) released the results of a statewide survey on short sales and the challenges we as REALTORS® face in working with lenders and servicers.

The most vexing problem is the unresponsiveness of the parties involved in the banks, and the length of time it takes to get anything done.  But let's not put all the blame in one place: it is true that the sheer quantity of files that one given person in a bank has to deal with is a challenge, whoever is there to do the work.  But the differences between banks, departments, locations, makes it really difficult to have a standard approach.  When a second or 3rd loan is involved, which is very often the case, then all bets are off...
“The lack of standardization, long approval process, and lack of lender approvals are hampering what should be a 45-day short sale process,” said C.A.R. President Beth L. Peerce. “Instead we’re hearing the typical response time for lenders is at least 60 days, and in many instances, their response time exceeds 6 months.”

Bottom line, these transactions are not for everyone.  You have to be very patient and go with the flow. You cannot put your heart in the property you want to buy.  You should not expect the succession of events to be logical, nor to make sense necessarily.  And you have to know that it may not go through, even if you, on your end, have done all you could and should do:  fewer than 3 in 5...
Francis
http://www.francisrolland.com/
Silicon Valley Realtor, - since 1985.

All cash buyers... a follow up...

To piggy back on my previous post, the number of homes purchased with cash in California jumped to a record 30.9% in January, per DataQuick.  According to the same source, 52% of the homes purchased with cash in Jaunary were being foreclosed on in the prior 18 months - which points to buyers-investors in large part.
Francis
Silicon Valley real estate.
Silicon Valley stats