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Belmont Market Report–October 2009
Changes to the Belmont home market seemed to have slowed recently.
(click the graph for a full sized image) Data retreived from the MLS.
MEDIAN PRICE
In 2008 the median home price stood at $960,000 in the month of October. This year, it has dropped to $865,000.
Once again the numbers are a bit misleading. The size home which sold last year in October was 150 square feet larger. The adjusted median home price for Belmont this year should be $938,000 which would put the median drop at a paltry 2.2% year over year.
DOM
The sellers in Belmont are still receiving around 99% of their asking price, just that they have to ask a little less this year.
SALES
Sales dropped from September but were almost double what they were last year at this time–reflecting more confidence in the market. Of course this number may be influenced by a mad dash of buyers availing themselves of the $8,000 tax credit.
So far 1.2 million buyers have qualified for the $8,000 tax credit. 40% of those said they would not have considered buying a home without it. 70% said it weighed heavily on their decision to purchase e home. Really? All it takes is an $8,000 credit and people are willing to buy a home?
The graph below shows the sales in Belmont for the month of October 2009. Since homes are sometimes relisted, the total days on market and original list price totals can be skewed. We searched the records and reported the actual data—noted by the green dots in the columns. This helps portray a more accurate picture of the time it takes to sell a home and the price a seller receives. Of the 14 sales in October one sold for asking in ten days. Seven sold for less than asking and were on the market an average of 113 days when they received, on average, ~$14,000 less than their LOWERED asking price. The sellers that appropriately priced their home fared much better, receiving on average $2,000 more than their asking price (we defined pricing a home right when it sells within the first month) and sold on average in only 33.5 says. More money, faster sale, one wold think every seller would try to price their home right.
Belmont Home Sales–September 2009
Belmont closed out the month of September with less than a stellar performance. There were 18 sales which is respectable–a couple more than last month–but still shy of even a normal market.
Is this still a Buyer’s market? We think so.
(Click on thechart to see an enlarged version).
Look at the percent a seller receives of their asking price. Few homes are selling over the asking price and if they are it's usually because the home is deeply discounted in the first place.
Another sign is the time a home languishes on the market, as expressed in Realtor speak as D.O.M. or Days on Market. Currently it stands at 45 days with six of the sales being listed for 3/4 of a year or more. One sale had to of broken the all time record when it finally closed after being on the market 700 days!
The median price took another beating in Belmont as the raw numbers show another 5% decrease over July values. Adjusted for smaller or larger homes selling, that percent is halved, but still, a 2.5% decrease is a downward trend that we hope will soon slow.
Belmont Home Sales — August 2009
August turned out to be a respectable month for Belmont sales with at 16 it was just one sale shy of last year.
DOM
You might notice a few oddities in the Days on Market stat. First, our MLS did away with Original Days on market vs. Days on Market as they felt it was simply too confusing. Original Days on market counted from when the home was first listed for sale and the old DOM stat simply kept tract of the most recent listing. Now, the DOM stat is for as long as the home was listed for sale—even with various brokers—with the caveat that if a home was de-listed for more than 30 days it resets to zero.
Percent of Asking
True to form homes that languish on the market received less than their faster selling counterparts. Note that of the ten homes that sold in their first 25 days of being listed did not have to lower their price with six selling on average for $23,000 over their asking and the remaining four for $22,000 under.
Of the six homes that were listed for more than 25 days ALL sold for under their ORIGINAL asking price—on average the seller received $86,000 less or 97% of asking as compared to well priced homes which received 104% of asking (Read was originally listed at $1,125,000 and Arroyo at $769,000 before being re-listed at a lower number that skews the results).
Median Price
The median price of homes selling in August was $837,500 and the median size home sold was 1655 square feet. Last month the median price was $917,000 but the home sold were larger at a median point of 1,860 square feet.
Last year in August the Median price was $947,000 but the size home was also much larger at 2,030.
If you work out the numbers the values really haven't changed much at all over last August, though for the entire year they are down closer to 12%.
The fall selling season is just getting started with another full quarter soon to review. If you are thinking of selling this year now’s the time to take action—the best time is between now and Thanksgiving.
Belmont – June 2009 stats
It’s easy to see the numbers for June are much better for sellers than they were in May. Almost all indicators are up signaling a stronger market for sellers in June as compared to last month (click on the chart to see a full size version).
Looking at the same period over last year a similar pattern arises. Almost every indictor is in the seller’s favor.
More homes sold this June and at a faster rate. The percentage the seller received was a healthy 98% of their asking price. The month’s inventory—the time it would take to sell all of the homes currently listed at the current pace of sales—has dropped to a healthy 3.1 months—far below the national average of over 10 months.
Of course there’s one nagging indicator which isn’t easily seen, and certainly not reported by real estate groups or even the media. Although the median price is up in June 4.5% over May, the size home sold in June was a whopping 17% larger. Over the same period last year, the difference is even more staggering. So even though the median price is essentially the same as it was in June of 2008, the size home you get for you money has increased 25%.
What this all means is buyers are getting better deal this year than last.
Why then is the percent the seller received of their asking price higher than it was last year? Probably because sellers are pricing their homes more realistically; and although they are getting closer to their asking price as a percent, in real dollars they are receiving far less.
Looking at San Mateo County as a whole we see the same positive statistics. More sales, higher median price, fewer days on the market and less inventory. What is not available for the entire county is the median size home sold so we really have no idea if the median values are rising, or simply larger homes are selling. We tend to believe it’s the latter.
| May-09 | Jun-09 | Δ from May | Jun-08 | Δ from '08 | |
| Median | $840,000 | $878,000 | $38,000 | $877,000 | $1,000 |
| DOM | 46 | 25 | 21 | 43 | 18 |
| Month's Inventory | 4 | 3 | 1 | 3 | 0 |
| Sales | 14 | 21 | 7 | 20 | 1 |
| Inventory | 62 | 62 | 0 | 61 | 1 |
| % Received | 98% | 98% | 0.0% | 91% | 7.00% |
| Median Size Home | 1,710 | 2000 | 290 | 1600 | 400 |
| Price per Sq. Ft. | $502.00 | $493.00 | $9.00 | $548.00 | $55.00 |
Belmont Homes Sales – May 2009
What’s happening in our local market is the number one question we receive so here’s the good the bad and the ugly for May 2009 in Belmont.
The Good
The number of homes sold in creased in May to 15 from April’s paltry 12. Still, compared to 2004 when 32 homes sold there’s not a lot of activity.
The number of days it took to sell a home in Belmont went from 48 in April down to only 37 in May.
Of the 15 sales in May, 5 sold over the asking price, none sold at asking, and 10 sold under the seller’s asking price.
The Bad
Homes which were originally overpriced took a beating.
|
Overprice Homes |
10 |
Homes Priced Well |
5 |
|
DOM |
76.8 |
DOM |
18.8 |
|
Percent Received of Original List Price |
89% |
Percent Received of Original List Price |
101.4% |
|
Real Dollar change |
$67,000 less |
Real Dollar Change |
$5,000 more |
The number of overpriced homes reaching a factor of 2-1 over well priced homes is indicative of the disconnect between what sellers feel their home is worth as compared to what a buyer will actually pay. It’s clear by looking at the numbers though that the number one mistake a seller can make continues to be overpricing their home.
The Ugly.
The median price in Belmont continued its correction in May.
|
|
May 2009 |
April 2009 |
May 2008 |
May 2007 |
|
Median Price |
$820000 |
$775,000 |
$1,098,750 |
$1,036,733 |
|
* Corrected for size of home |
$820,000 |
$855,000 |
$952,300 |
$1,106,533 |
|
May Δ in percent |
|
-4.09% |
-13.94% |
– 25.89% |
*We endeavor to report the true median price as accurately as possible. In doing so, we must take into consideration if larger or smaller homes are selling in a given period.
*Date retrieved form the Multiple Listing Service of San Mateo County.
Market Report–Belmont Home Sales April 2009
The homes sale report for April shows a continuing slide in both sales and median price for the Peninsula cities, though we appear to have a lull in the action.
Take the median price of single family homes in San Mateo County for example. In April of 2008 it stood at $925,000. This April that number came in at $610,000–a whopping 34% decrease. Sales have dropped 15% over last year at the same time and 40% off the peak of the market in 2005. Yet every month so far this year the median price has been creeping back up, ever so slightly. Exciting news? Not really. The median price almost without fail creeps up this time of year.
(Click on the image to see a full sized graphic)
For Belmont, April home sales came in at a disappointing 13 for the entire month, a 38% decrease over last year’s more typical 21 sales for the month.
The median price came in at $775,000, considerably off of the $930,000 reported just last April. The size homes which sold last April were only slightly larger–3.7%. Which means that the calculated median home price loss of 16.6% might be closer to only 13%, if that makes anyone feel any better.
And don’t expect to get close to what you are asking. On average in Belmont sellers are receiving only 94.84% of their asking price and it is taking about 33% longer for them to get less for their home. Don’t think that isn’t hurting agents too. Agents who are listing homes for sale are finding it takes longer to sell a home. Longer listing periods can mean thousands more in advertising costs and with values dropping, thousands less in commissions.
Click here to see April sales report for surrounding cities.
Belmont Housing Report–March 2009
The home sales are in for Belmont for the month of March 2009 and they exhibit all the indications of a continuing declining market. We wrote a short post on what the numbers mean when compared to the same period just a few years back.
This is the same period just twoyears ago…
Belmont and the Bay Area Peninsula Housing Downturn
If you’re wondering where the housing downturn is headed in Belmont you can get a good indication by these two snap shots taken for the month of March 2007 and 2009.
We use 2007 as a benchmark since it was the last year where the impact of the housing crises had not yet been realized in our market.
Here are some startling yet revealing statistics:
The far right column of this chart says it all. Every indicator in red illustrates a deterioration of the seller’s market which has prevailed for so long.
You may notice that even though larger homes sold in 2009 the median price still dropped $161,500 in 2009. Adjusting for this, the real median price drop is actually $252,850 or 26%.
Today, on average it will take almost three times as long to sell a home in Belmont; when you do sell you are likely to receive under you asking price. In fact statistically you no longer have any chance of getting over your asking price and the odds of getting less than your asking price has increased by 50%. Sellers now receive on average only 96% of what they ask for their home compared to over 103% in 2007. In real dollars that translates into a swing of $52,000.
In the end, this much anticipated market correction will produce a more stable real estate market. Affordability is increasing and eventually sales will increase as buyers feel more optimistic about the future, including job security and housing stability.
Considering the drop in value we are experiencing, for sellers who are debating a moving out of the area, sooner rather than later will probably produce a better result. In all likelihood it will be many years before inflation drives price points back to levels seen in 2007.
A down market is typically an attractive time for sellers who are thinking of a move up. The logic behind this is a more expensive home is less in real dollars–and also saves you thousands of dollars in property taxes over the life of your ownership. Our current market also includes attractive Interest rates that are at historic lows, though Jumbo loans are not enjoying the full benefit of the government’s intervention.
Buyers who have stable jobs and are planning to live in their first home for five years or more are benefitting the most from the current conditions. Prices are at a low not seen in years, interest rates are at historic lows, the government is paying them $8,000 to buy a home this year, multiple offers are for the most part non-existent and the high inventory levels means there are a lot of homes to choose from.
In every market, there are opportunities. If you would like advice on how to make the most of our current economic climate give us a call at (650) 508-1441.
*Data retreived from the MLS
The information contained in this post is educational and intended for informational purposes only. It does not constitute legal or tax advice, nor does it substitute for legal or tax advice.
HOUSING REFORM-2009 Panacea or Panic?
The news is full of housing reform stores but the shelf life for reform legislation seems shorter than that of freshly baked bread—what made the news just yesterday is often obsolete by today.
We expect 2009 to be a turbulent time in real estate. Knowing how to weather the storm is paramount to the survival of homeownership.
Key Elements
President Obama signed a $787 billion stimulus bill which includes many features to protect homeownership.
These are a few of the incentives targeted to help 4-5 million responsible homeowners stay in their homes:
\\· Provide access to low cost refinancing where borrowers who have less than the required 80% loan-to-value could refinance to lower their monthly payment.
· Seventy-five billion will be spent on homeowner stability initiatives to help struggling homeowners who, because of the recession, are hard pressed to make their mortgage payments and cannot afford to sell or refinance their home due to a drop in value.
· No aide to speculators. The initiative has no provision for assisting investors or speculators.
· Provide support for homeowners who are at imminent risk of default before they miss a payment.
· Provide loan modifications to bring monthly payments to sustainable levels.
· â€Pay For Successâ€â€”Initiative for loan servicers to receive $1,000 per month each month a borrow stays current on their loan.
· “Help Borrowers Stay Currentâ€â€”Provides a $1,000 per month reduction in a home owners’ principle loan balance for five years if the borrower keeps their payments current.
· “Reaching Borrowers Earlyâ€â€”An incentive of $500 to loan servicers and $1,500 to mortgage holders if they modify at-risk loans before the borrow falls behind.
· “Home Price Decline Reserve Paymentsâ€â€”Holders of mortgages modified under the program would be eligible for an additional insurance payment (from a newly formed entity under the Treasury Department) on each modified loan to offset declines in the home price index.
There are quite a few more initiatives to help homeowners. Though many do not apply to the majority of the loans on the Peninsula since they are not held by Fannie Mae or Freddie Mac.
Lenders Are Worried.
Recently, many lenders have been modifying loans without incentives just to keep their head above water. However in contrast to the President's incentive plans, many banks require the homeowner to be months behind in payments before any relief is possible.
►If your mortgage is scheduled for an interest rate increase which you feel you may not be able to afford, we encourage you to contact your mortgage holder immediately and see if they will modify your existing loan. It’s in everybody's best interest if homeowners can continue to make their monthly payments, even if it takes a loan modification to make it happen.