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Carmen Miranda, Diamond Certified~DRE 01065975

Mortgage Rates to Rise, Sooner rather than Later

The Fed plans to stop buying mortgage-backed securities the end of March.

The general consensus among mortgage brokers is rates will have to rise to attract new buyers of MBS if the Fed does stop buying. After reaching a low last November, the rate for 30-year fixed mortgages has already risen .25%-.375% in anticipation.

The only MBS that are being sold right now are those that are backed by Fannie Mae and Freddie Mac because they are backed by the U. S. government, at least for loans up to $729,000 in our area.

The question becomes, who is going to buy MBS and at what price?

With money market and treasuries yielding between 1%-2%, MBS are looking much more attractive to Wall Street, private investors and foreign governments.

But, at some point, the Fed will have to start selling their MBS which will drive prices down and yields up.

Local mortgage brokers expect rates to rise one-half point fairly quickly after the Fed stops buying. Many think mortgage rates will hit 6% by the end of the year.

That said, the biggest problem facing the local market right now is lack of quality inventory: quality meaning priced right and in the best neighborhoods.

The Real Estate Report L O C A L M A R K E T T R E N D S FOR SAN MATEO COUNTY

The Real Estate Report L O C A L M A R K E T T R E N D S FOR SAN MATEO COUNTY

THIS ISSUE: Investors are back in the market, and they're paying all-cash, mostly for property under $500,000. The effect of this is to freeze out first-time home-buyers who have to get a loan. Banks are still scary about providing loans. About the only loans left for first-time buyers are FHA loans. So, while the first-time buyer is working through the loan process, the investors are swooping in and buying the best property, which, after slapping a coat or paint on and, maybe, replacing the carpeting, they are putting back on the market. Sometimes, they rent out the property hoping for more appreciation down the road.

Appraisals are also affecting buyers who need a loan. Appraisals lag the market because they use past data, typically six months worth, to calculate current market value. When a market has bottomed out and begins rising, appraisals often come in under the value agreed upon by the buyer and seller. Banks are requiring buyers to come up with extra cash to make up the difference. First time buyers are having a hard time doing this, so we're seeing many more sales fall out of escrow than normal. Another thing hanging over the market is the so-called Bshadow inventory of bank-owned property that has not been put on sale. If the banks release these homes in a measured manner, the market should be able to absorb them.

Home sales were down significantly in January, falling 39% from December. Nevertheless sales were up 30.5% year-over-year. This is the fifth month in a row home sales have been higher than the year before. The decline in sales is not a result of reduced demand, rather it was produced by a lack of inventory, or should I say, a lack of desirable inventory. We expect sales to regain their momentum through the Spring because of the extended tax credit and because this is historically the prime time for home sales. From talking with other San Mateo County real estate agents, properly priced homes in the most desired neighborhoods and school districts are being sold with multiple offers: many multiple offers. Pending sales, which is a solid indicator of future sales, was up 54.7% year-over-year in January for the seventh month in a row.

Remember, the real estate market is a matter of neighborhoods and houses. No two are the same. For complete information on a particular neighborhood or property, call me at my direct line at 650 598 2800 or visit me at www.carmenmiranda.com. Email is good too at: carmen@carmenmiranda.com

Enjoy your day!

Home Sales and Prices Rise in September '09 in San Mateo County

The median price for homes turned upward last month, gaining 3.5% from August. It was down, yearover- year, by 7.5%. The average price gained 12.8%, month-over-month. Year-over-year, the average price was up 2.1%. This is the first time the average price has been higher than the year before since May 2008. Home sales were up 2.7% from August, and up 24.7% compared to last September. Year-to-date, home sales are down 5.3%. Inventory of single-family, re-sale homes was down 41.7% year-overyear.

Pending sales were up 63.4% compared to September 2008. Our Days of Inventory indicator rose one day to 91 days. The sales price to list price ratio rose 0.2 of a point to 99.8%. Condo sales were down 14.9%from August, but were up 33.8% year-over-year. Year-to-date, condo sales are off 2.3%.

The median price for condos dropped 9.3% month-over-month, and was down 6.4% compared to last September . The average price for condos fell 4.7%, month-over-month, and was down 6.5% year-overyear. Condo inventory fell 4.4% month-over-month, and was down 36.6% yearover- year. Condo pending sales were up 131.9% year-over-year. The real estate market is very hard to generalize. It is a market made up of many micro markets. For complete information on a particular neighborhood.

Trends at a Glance (Single-family Homes)

Sep 09 Aug 09 Sep 08

Sale/List Price Ratio: 99.8% 99.6% 98.1%

Days of Inventory: 91 90 195

Days on Market: 54 55 54

Median Price: $698,500 $675,000 $755,000

Average Price: $950,475 $842,822 $931,245

Home Sales: 379 369 304

San Mateo County~Buyer Workshop~Oct 18th~"Prerequisite to Today's Home Buying"

LESS THAN 2 MONTHS LEFT!

  • First-Time means that the buyer has not had any ownership interest in a home in the past 3 years
  • Home purchase must have been between January 1 and November 30, 2009
  • Tax Credit can be up to $8,000
  • This is a credit, with no repayment required, if the buyer stays in the home for at least 3 years

"This workshop should be a prerequisite to home buying"

Buyer's WORKSHOP~Claim your 8K Tax Credit before it expires!

Successful Home Buying Secrets!

Sun. Oct. 18TH •

10:30 -12:30

A panel of experts including CPA, Loan Broker and top Peninsula Realtors will answer your questions.

Preseented by Carmen Miranda,Diamond Certified, Alain Pinel Realtors~www.carmenmiranda.com~650 598 2800~DRE No. 01065975 and Max Almalidis, Co-Presenter~650 740 0241~DRE No. 01506903

•Is Now a Good Time to Buy? Examine Where the market is today...and Where it is going?

•Are You Buying the Right House?

•Avoiding Real Estate Investing Pitfalls? 5 TIPS you need to know.

•BUYER SMARTS: Do I need a larger down-payment in today's lending market? How do new appraisal safeguards impact my purchase? What does an inspection cover?

•Making a Profit with a Fixer-Upper!

•and more... bring your questions!

INVITATION ONLY!

Seating limited.

Call for more information and future

workshop schedules and dates TODAY.

650.598.2800 or 650.740.0241

Surge of Multiple Offers in San Mateo~Did you know...$8000 Tax Credit and Higher Conforming Limit are Expiring?

I was conducting research for clients looking to invest in the City of San Mateo on a desirable neighborhood (west side of El Camino) and was informed that a 2bd/2ba home had received 7 offers. I believe the offer accepted was well over the asking price and there was a back up offer. I am seeing this on specific homes that are priced well, in a favorable neighborhood in good condition. This high level of interest is caused by historically low~long term fixed interest rates, FHA financing with low down, soon to expire higher conforming limit (729K) and the soon to expire~first time buyer $8000 tax credit that doesn't need to be pay back to the feds.

For further information on San Mateo County's housing market..where is our Real Estate Market today (by City/Neighborhood) and the near term, as well as to receive invaluable information and resources from Loans, Tax Incentives/Credits to how to profit from Fixer Uppers...

Buyer's WORKSHOP~Claim your 8K Tax Credit before it expires!

Successful Home Buying Secrets!

Sun. Aug. 23rd •

11:00 -12:30

A panel of experts including CPA, Loan Broker, Inspector & top Peninsula Realtor will answer your questions.

Presented by Carmen Miranda,Diamond Certified, Alain Pinel Realtors~www.carmenmiranda.com~650 598 2800~DRE No. 01065975 and Max Almalidis, Co-Presenter~650 740 0241~DRE No. 01506903

•Is Now a Good Time to Buy? Examine Where the market is today...and Where it is going?

•Are You Buying the Right House?

•Avoiding Real Estate Investing Pitfalls? 5 TIPS you need to know.

•BUYER SMARTS: Do I need a larger down-payment in today's lending market? How do new appraisal safeguards impact my purchase? What does an inspection cover?

•Making a Profit with a Fixer-Upper!

•and more... bring your questions!

INVITATION ONLY!

Seating limited.

Call for more information and future

workshop schedules and dates TODAY.

650.598.2800 or 650.740.0241