With a nod to Carlmont High’s class of 2009 starting their first full week after winter break , and real estate just coming out of winter hibernation, we thought we’d take some of our downtime to summarize a fewof our sales in 2008 and offer a big thanks to the many clients who hired us to help them get their perfect home this year.
Most Likely to Succeed
I guess you could say this Hillsborough home has already succeeded in many ways. At 10,000+ square feet it’s the largest home we’ve ever sold and at $10,990,000 it’s also the most expensive.
What a deal though, our buyer received an offer for over a million dollars more than what they paid for it a month later (they turned it down). LISTED for $10,990,000 SOLD for $10,900,000.
Check out the cool backyard with pool, tennis court and guest house!
Most Creative
Terrance and Patricia have grand plans for this modest home in Redwood Shores. We won this home for them in multiple offers. Plans include a two story addition which will give them views of the San Francisco bay! LISTED for $859,000 SOLD for $ 889,000 in four days. Good luck with your remodel!
Class Favorite
Everyone who has seen this home falls in love with it just like Chris and Tracey did when Chris found it online. We’d been looking for the perfect home for several years when lo and behold this estate came up in Los Gatos.
This has to be one of the neatest homes we’ve ever sold. Check out the outdoor entrainment possibilities with the coolest veranda we’ve seen.
Oh yeah, did we mention the weather down there makes outdoor dining a summer standard. Great housewarming party BTW. LISTED for $4,500,000 SOLD for $4,250,000
Best Dressed
Hands down for Best Dressed was this home in Redwood Shores. Chris and Tracey had an amazing home which we were happy to sell. Even our stager said she wouldn’t change a thing!
Check out the rear BBQ area that's the envy of the neighborhood. And thanks to Tracy’s interior design skills, she made this an easy sell and was rewarded with the highest sale ever in their neighborhood. LISTED for $1,428,898 SOLD for $1,400,000.
Most Talkative
Our listing in Hallmark gets the nod for most talkative since the neighborhood was abuzz when we listed it. We’d been prepping it for a month and being that it was on Hallmark Drive, it got quite the visibility. We were absolutely deluged at our open house and when we sold it in one week (in the midst of the financial melt-down) the calls were rolling in asking how we sold it so fast.
The answer is the seller did everything we asked of him and readied is home with professional staging and enhancements. There’s a neat video if you want to see the before and after pictures. Thanks Eiji—you were a pleasure to work with and we are still saddened that you lost your cat one day before you moved—we’re always on the lookout for him. LISTED for $1,298,890, SOLD for $1,285,000 in about a week.
Before we wrote this year’s forecast, we went back and re-read our assessment of where the market might be headed in 2008.
Of course very few people could have predicted that the dire real estate woes would drag the entire economy to the brink of collapse and we were no better than most.
“This is precisely why the Peninsula should fare better than other areas [in 2008]â€.
“However, it’s entirely possible we are on a precipice which could collapse at any time. What is [currently] impacting the Peninsula is the rising cost of energy—especially gasoline.â€
“What could have an incalculable impact would be aprolonged recession and loss of local jobs; either of these would undoubtedly bring a decrease in home values to the Peninsulaâ€.
In 2008, Investors eventually began to snap up undervalued properties in the central valley and a few of the nine bay area counties which were hard hit by foreclosures. This had the desired effect of liquidating the tidal wave of inventory but the undesirable effect of sinking the reported median price by skewing the sales mix to smaller homes (since smaller homes and distressed properties sell for less). The media meanwhile continued its relentless reporting of the falling median home price without appreciable application of responsible journalism. Bombarded by the media’s lack of analysis, invariably many buyers were frightened by the reports of falling home values and quite reasonably and expectedly took a “wait and see†attitude. That’s not to say the media’s information was wrong, but they do choose what to report and what to leave out and in many cases they reported numbers without the necessary perspective leading many to believe the housing situation to be far worse than it was in some areas, and far better than it was in others.
Although clearly there were several other factors which inhibited the ability of people to purchase homes—not the least of which was tighter lending standards and higher interest rates—our intrinsic evidence suggests that most credit worthy buyers on the Peninsula withheld from purchasing a home based on the fear of values spiraling down, not because they wanted to wait and “time the absolute market bottom†or couldn't get a loan.
We’ve got a lot to cover at the beginning of a new year as we go back and examine all of 2008 as well as the month of December.
This is our month-end report of home sales in Belmont for the month of December 2008. Note that while the median price dropped significantly from November, so did the size home which sold in December. The difference in size of homes in the two months was 190 square feet. At the price per square foot of $514 that could account for $97,660 of the difference in the median home price—meaning that home prices were actually higher in December if you factor in for the size of home which sold.
Sales were up too. There were eight sales in November and eleven in December. That’s an anomaly as typically sales in November are greater than December. We’ll chalk that one up to the dire economic news in October (October sales are November’s closings).
Those of you who have been following us for some time know that at the beginning of each year we re-cap the previous year and take a stab at where the market might be headed in the upcoming year.
Of course you expect to read the median price has dropped and in fact it has, just not as much as you may have been anticipating. While the Bay Area nine counties reported a median price drop of over 40%* from 2007, Belmont had only a 5.4% decline and that’s after we factored into our calculations slightly larger homes sold in 2008. The raw numbers, which tend to be the only ones reported, suggest a decline in median price of only 2.6% for the year.
SALES ARE KEY
Sales are key to the survival of Realtors®, but unless you are selling your home you could probably care less how many homes sell in a given year. However, it gives us a good indication of overall market activity—with the caveat that sometimes sales are down simply because there are fewer homes to sell.
Sales of single family homes (our benchmark for all comparisons) were down from last years’ 219 to a paltry 170 for the entire year in 2008—a decrease of over 22%! Contrasted to a year of more normal market activity, (as recent as 2003 when 343 homes sold), sales are down up to 50%. Clearly we are in a period of slower than normal home sales.
HOMES LISTED FOR SALE
But were there fewer homes to sell in 2008? It’s hard to believe but for the entire year, at 309, there were only two fewer listings than in 2007.
What’s in store for 2009?
With the perfunctory disclaimer that past performance does not predict future results, we fear in 2009 it may however be quite true. We wouldn’t be surprised at all to see a continuation of the stagnant real estate market which has had a choke-hold on home sales in 2008. Interestingly, the last major downturn in real estate which began in 1989 was caused by an overall weak economy and most importantly the loss of jobs. In contrast, the current housing downturn has in effect created the recession—a reversal of past cycles.
That’s a long way of saying that housing cannot recover until the economy does and the economy won’t recover until housing stabilizes. Sound like a Catch-22? Well it is. And while it appeared in the second quarter of 2008 that the real estate recovery might begin in 2009, we now believe that will be pushed out at least another year. That said, any sign of a recovery will manifest with a leveling off of inventory and declining home values. A period of stagnant home values will invariably last for another year or two following a price plateau as buyers still wary of a volatile market will only reluctantly reenter the market. Most will wait too long and catch prices on the way back up but there’s no telling when that will happen. We’re not telling you to run out and buy a home as part of a fear based campaign, “Hurry or you may miss the bottomâ€, but in every market there are opportunities which should be examined. We learned long ago to resist trying to explain to people why they should buy a home and rather help those who are already motivated. Like the old saying, “You can lead a horse to water…†but he has to be thirsty. This year’s wild cards? Interest rates, consumer confidence the recessions and jobs, jobs, jobs!.
We anticipated Belmont home sales closing at eight for the month of November in a previous post where we did an extensive review of the local market.
Click on the play tab to hear an overview
These first two graphs will be explained more in detail further in our post but as you can see the percentage of homes selling over the seller’s asking price has increased.
(Click on the chart below for a full size image).
As you can see from the sales report, sales are down considerably from the previous month and down from than that of a year ago as well. We’ve added a chart showing the differences (below) that will help put November’s numbers in perspective.
(Click on the chart below for a full size image).
To sum up the data we’ve also added arrows depicting whether each indicator (or data point) is an improvement this November over the two previous periods reviewed. An up arrow ↑indicates that this November’s data is an improvement over the previous periods while a down arrow↓ indicates the opposite is true.
MEDIAN PRICE
The Median price, the point at which half of the homes have sold more or less, remains virtually unchanged from October 2008. Counter intuitively November’s median at $912,000 is higher than in 2007 when it stood at $894,000. The size of homes selling greatly impacts the price per square foot as smaller homes sell for more per square foot and larger homes tend to sell for more period. Accounting for the difference where in 2007 the median home size was 1645 square feet and this year where the median home sold was 1,910 sq. ft., at $514 per square foot that would make the 265 sq. ft. difference in size worth around $136,210 meaning that home values actually dropped 7% over last year’s November, not up 2% as the raw data suggests.
SALES
At only eight sales as compared to last November’s 20, it’s amazing that inventory is not higher. At the time we wrote this the inventory of active homes for sale in Belmont stood at only 50. To some degree that helps balance the supply and demand and keep prices in relatively check.
This November three homes sold over their asking price—the same number as last year. The difference is this year homes that sold over their asking price represented 43% of all the November sales while last year it represented only 15%.
PRICE PER SQUARE FOOT:
Be careful not to read too much into this. Last year homes sold in November sold for $70.00 more per square foot than this November—but the homes that sold last year were much smaller; and as was discussed above, smaller homes tend to sell for more per square foot because land is a constant in the calculation and can account for half of a home’s value.
PERCENT RECEIVED:
This November sellers received on average 99.38% of their asking price—virtually unchanged over October’s performance and better than last November’s 97.9%. This needs to be weighed against the CDOM (Continuous Days on Market) and the number of price reductions statistics to be meaningful at all. Sure homes sold this November closer to their asking price, but did the seller receive more in real dollars? How many price reductions and how many days a typical home is on the market help put this number in perspective. Notice that homes which needed a price reduction in order to sell accounted for nearly 63% of all sales this November while last year they accounted for only 25%. But the time it took to sell a home, though higher than in October, dropped from 46 to only 29 days this November. What does this suggest? That more sellers are forced to lower their expectations and lower their asking prices sooner rather than later.
This information is for entertainment purposes only and includes no legal, accounting or real estate advice nor is this intended to be specific to your situation-always consult a specialist who is familiar with the details of your situation.
Information deemed reliable but not guaranteed. This is not intended to be a representation of homes listed or sold exclusively by Drew or Christine Morgan or Carlmont Associates.
As part of our Real Estate REVEALED series we answer another Frequently Unasked Question in our latest Podcast—how do you know when a home is priced right? In addition to this latest Podcast, we’ve added a web page that makes finding the entire series of archive issues in one place.
Podcasts
Drew & Christine Morgan
"Helping People Make Good Decisions"sm
(650) 508-1441
Click the mic for the web version of this page.
Thanks for visiting our Podcasts. Each week we offer a housing market update podcast on our blog at BeautifulMountainBlog.org as well as our series titled "Frequently Unasked Questions" where we tackle questions buyers and sellers should be asking but frequently aren't, and "Real Estate Revealed" where we discuss industry insider information. Enjoy and don't forget you can subscribe to our podcast stream to be automatically updated with any new releases by clicking on the orange RSS icon.
We’re very excited to bring you anew animated version of our graphsdepicting the various housing market trends in San Mateo County and the cities which lie within.
Each month we download data from our Multiple Listing Service and analyze the market indicators. We provide this in-depth analysis for several of the many cities we serve on the Peninsula.
We’ve also added short audio tags to describe what we are depicting and help put the information in perspective.
Another feature will be our “Weekly Graphâ€.We’re not saying it will change each week but when an interesting trend develops you’ll find it under that tab.
We hope you’ll take a moment to check out our new graphical interface on our“How’s the Market?†link and give us some feedback.
Belmont’s housing picture settled down a bit as homeowners who had stalled temporarily in the wake of October’s housing news began to list their homes for sale for a pre-winter push.
→NEW Click on the play button to hear a brief market overview.
There are 53 homes for sale in Belmont, down from 57 in the last several weeks.
Five new listings have recently hit the market, three have been re-listed and there were three that closed escrow as well.
ACTIVE HOMES
1943 Hillman—4 Bed 3.5 Bath 2,969 Sq. Ft. home on a steep up slope 8,500 Sq. Ft. lot. LISTED for $1,195,000. OK, the lot is steep and if you don’t mind stairs you’ll actually find a level rear yard area out back. Nicely appointed home with remodeled kitchen. Listed By Val Shevelyov, Quest Real EstateOPEN HOUSE INFO NOT AVAILABLE.
528 Davey Glen—4 Bed 2.5 Bath 2,190 Sq. Ft home on a 7,350 Sq. Ft. lot LISTED for $1,139,000. Davey Glen is a busy street with mixed use (i.e. Condos, homes, businesses).Note—this home last sold in 1997 for $479,500. And who says Peninsula Real Estate is a bad investment. Listed By Bryce Cook, RE/MAX TodayOPEN SUNDAY 11/23 1:00-4:00
1902 Miller Ave.—3 Bed 2.5 Bath 2,030 Sq. Ft. home on a 9,800 Sq. Ft. lot LISTED for $999,999. This home has a nice setting and is reminiscent of the Brady Bunch home of the 1970’s—though it has been updated. Listed By Wendy Grainger, Wendy P. Grainger, BrokerOPEN SUNDAY 11/23 1:00-4:00.
3402 Lower Lock—3 Bed 2 Bath home on a 5,500 Sq. Ft. lot LISTED for $899,888. This home shows impeccably and has a very nice secluded rear level yard. Listed By Debbie Wilhelm, Coldwell BankerOPEN SUNDAY 11/23 from 1:40-4:30.
1941 Alden Street—3 Bed 1 Bath 1,330 Sq. Ft. home on a 5,500 Sq. Ft. lot LISTED for $ 865,000. Nice updated ranch home and it shows rather well. Elevated in the rear—level; yard below. The street is moderately busy. Listed by Debbie Sharp, Alain Pinel RealtorsOPEN SUNDAY 11:23 1:00-4:00 and again on 11/30 (same times).
1021 Elmer Street (no photos)—3 Bed 2 Bath 1,250 Sq. Ft. home on a level 5,000 Sq. Ft. lot in Sterling Downs (AKA east side of El Camino). LISTED for $689,000. This is a pre-foreclosure sale bargain hunters start your engines… Listed by Cameron Thompson, Alain Pinel RealtorsOPEN SUNDAY 11/23 2:00-4:00 and again on 11/30.
RE-LISTED HOMES
2007 Monroe Ave. 2 Bed 1 Bath 930 SQ. Ft. home on a 4,000 Sq. Ft. lot. RE-LISTED for $655,000 with no price reduction. This home has potential. Don’t let the 930 Sq. Ft. scare you away—it has a bonus room below which adds another 250 Sq. Ft. probably. Listed By Peter Vece, Dumas & Company
1909 Lyon Ave. 3 Bed 2.5 Bath 1,629 Sq. Ft. home on a 5,150 Sq. Ft. lot LISTED for $865,000 down from $869,888. The real price reduction was from $912,000 back in August. This home is now a very good deal and someone should jump on it. Nicely appointed and very clean. It has a level rear yard on a ½ level down access. Listed By Celeste L. Pagan, Carlmont AssociatesNO OPEN HOUSES LISTED.
2422 Hastings Dr. 3 Bed 2.5 Bath 2,250 Sq. Ft. home and a 4.032 Sq. Ft. lot RE-LISTED for $1,108,000 (same as before).These homes are along Hasting Drive and they are usually attached, though some are technically detached. This one has a canyon view and it’s an end home on the block so it has a neighbor on only one side and great canyon views out the other two (the front has a street view). It started at $1,038,000 back in August 2008 and was lowered to $1,018,000. It didn’t sell and a new agent listed the home at the same price. Listed By Jun Kyu Chung, East West Realty
SOLD HOMES
↑1500 Escondido Way—4 Bed 2.5 Bath 2,080 Sq. Ft. home on a 17,120 Sq Ft. Lot LISTED for $1,250,000 SOLD for $1,375,000 in 12 Days. This home was unique in that it has a huge level lot and is located near downtown on one of Belmont’s premiere secluded cul-de-sac streets. The only negative to this home was it backed up to Ralston Ave. and Chula Vista so it does get some street noise. Other than that, it’s a one-of-a-kind home and worth every penny they paid over for the home.
↓1314 Paloma—3 Bed 3 Bath 2,390 Sq. Ft. home on a 4,320 Sq. Ft. lot. LISTED for $995,000 originally. It was lowered to $925,000 after three weeks and two weeks later it received a contract and SOLD for $900,000.
It’s interesting to note that the two homes above were both remodeled yet the smaller one received $425,000 more. One can never underestimate the allure of a park-like level rear yard. It’s also interesting to note that appraisers typically will allow only $5.50 per square foot credit for land. At that rate Escondido should have only received $970,000 rather than the $1,375,000 it did. Clearly appraisers are way off on estimating the value of usable land vs. just land (i.e. a sloping lot).
↓809 North Road—3 Bed 1.5 Bath home LISTED for $629,900 SOLD for $607,402 in Nine days. This was a great starter home on the west side of El Camino.
This information is for entertainment purposes only and includes no legal, accounting or real estate advice nor is this intended to be specific to your situation-always consult a specialist who is familiar with the details of your situation.
Information deemed reliable but not guaranteed. This is not intended to be a representation of homes listed or sold exclusively by Drew or Christine Morgan or Carlmont Associates.
Belmont's City Parks and Recreation department would like to remind you about some fun, free and low cost events coming up. The Holiday Craft Faire in Twin Pines Park, Belmont, is on Sat. and Sun., November 22nd and 23rd – FREE for visitors! Many vendors with all handmade items, all price and interest ranges.
We’re very excited to bring you a new animated version of our graphs depicting the various housing market trends in San Mateo County and the cities which lie within.
Each month we download data from our Multiple Listing Service and analyze the market indicators. We provide this in-depth analysis for several of the many cities we serve on the Peninsula.
We’ve also added short audio tags to describe what we are depicting and help put the information in perspective (Click on the play button to hear a brief introduction).
Another feature will be our “Weekly Graphâ€. We’re not saying it will change each week but when an interesting trend develops you’ll find it under that tab.
We hope you’ll take a moment to check out our new graphical interface on our “How’s the Market?†link and give us some feedback.
