Santa Clara Valley Living » santa clara county real estate

Santa Clara County Home Inventory

vbrasil — Fri, 29 May 2009 17:45:12 +0000

What a week for home sales across the Santa Clara County west valley area. You can see the numbers below in Santa Clara, Sunnyvale, Cupertino and even the highend markets has started to bounce back. It is very evident that sales have picked up and inventory has started to drop across the board. The conditions of low interest rates, lower property values, not sure the $8,000 tax credit is influencing much in this area, but perhaps the largest is the change in consumer confidence.

Santa Clara homes continue to sell in higer numbers and inventory now is down to below 140 homes. Cupertino, Sunnyvale, and even Mountain View inventory has dropped these past weeks.

Even the high end market has seen a bit of improvement on inventory. Sales haven’t been increasing like the lower end just fewer properties comming on the market.

In the typical Santa Clara County real estate cycle sales will start to taper off in the summer months through winter, it will be interesting to see if this year follows that pattern or if the bargin hunters will continue on to the rest of the year.Similar Posts:

Santa Clara County New Listings and Sold Listings

vbrasil — Sun, 03 May 2009 21:12:23 +0000

These graphs show the weekly absorption of home sales and new listings that have come on the market. This is a very interesting statistic to follow. I have been following this statistic closely because I feel it tells you the whole story behind inventory. Are listings selling or not selling and are they keeping up with the rate of new listings. Well we are going to answer those questions for the Western Santa Clara Valley cities of Palo Alto, Mountain View, Sunnyvale, Santa Clara, Saratoga, and Sunnyvale.

There have been 9 to 10 new listings a week coming on to the Cupertino market and between 5 and 6 homes selling in the last few weeks. I appears that buyers have stepped up efforts in the last three weeks. Also the rate of new Cupertino home listings has recently slowed. Although inventory should still be climbing the increase is staring to slow.

There have been between 10 and 11 new listings a week recently on to the Los Altos home market and between 5 and 6 homes selling in the last few weeks. Thats alto better than most high end home market it still makes for a slow market. If you have been following the Los Altos home market you probably have noticed price reductions and lower priced listings.

Similar to Los Altos, Mountain View has also experienced an increase of buyer activity in the spring. Although not keeping up with new listings, Mountain View has about 5 to 6 homes selling a week and 8 to 9 new home listings.

Probably one of the biggest shifts in the market is the Palo Alto home market. Right around this time last year there were about 14 to 15 homes selling a week in Palo Alto compared to 8 and 9. These last few weeks have made up some lost time in Palo Alto.

Saratoga much like the other high end markets have seen a recent increase in sales, but definitely down from the previous years numbers.

Santa Clara is actually performing quite well with its sales numbers. Prices have come down in the area and have already stabilized and buyers are entering the market. New Santa Clara home listings are around last years numbers or a bit down, and sales are higher this year.

New Sunnyvale listings are down from last years number and sales are more down from last years.

Certainly we are experiencing better buyer activity in recent weeks and the rate of new listings has started to peak. I’ll be reviewing these figures on a weekly basis to evaluate the progress of the local Santa Clara Valley Market.Similar Posts:

Santa Clara County REO’s good deal or not?

vbrasil — Fri, 23 Jan 2009 15:17:31 +0000

You hear on the tv and the paper that you can get a great deal on an REO. You expect 50% savings off your dream home, after all isn’t this the worst real estate market in history? Sounds great and it might just happen, but first you should take a look at some facts and get prepared.

REO vs. Foreclosure

An REO (Real Estate Owned) is a property that goes back to the mortgage company after an unsuccessful foreclosure auction. You see, most foreclosure auctions do not even result in bids. After all, if there was enough equity in the property to satisfy the loan, the owner would have probably sold the property and paid off the bank. That is why the property ends up at a foreclosure or trustee sale.

Foreclosure sales begin with a minimum bid that includes the loan balance, any accrued interest, plus attorney’s fees and any costs association with the foreclosure process. In order to bid at a foreclosure auction, you must have a cashier’s check in your hand for the full amount of your bid. If you are the successful bidder, you receive the property in "as is" condition, which may include someone still living in the property. There may also be other liens against the property. So you better know what you are buying, and don’t expect your real estate agent to help you out, since foreclosures do not pay commissions.

These days, and the Santa Clara County is no exception, what is owed to the bank is almost always more than what the property is worth, and as a result very few foreclosure auctions result in a successful sale. Then the property "reverts" to the bank. It becomes an REO, or "real estate owned" property.

REO Properties For Sale

The bank now owns the property and the mortgage loan no longer exists. The bank will handle the eviction, if necessary, and may do some repairs. They will negotiate with the IRS for removal of tax liens and pay off any homeowner’s association dues. As a purchaser of an REO property, the buyer will receive a title insurance policy and the opportunity to investigate the property. Much better than buying a foreclosures.

A bank owned property might not be a great bargain. Do your homework before making an offer. Make sure that the price you pay (if you’re successful) is comparable to other homes in the neighborhood. Consider the costs of renovation, including time to complete them. Don’t get caught up in a ‘bidding war’ and pay over market value. Not all REO’s are great deals.

How Banks Sell REO’s

Each bank/lender works a little differently, but they all have similar goals. They want to get the best price possible and have no interest in "dumping" real estate cheaply. Generally, banks have an entire department set up to manage their REO inventory.

Once you make an offer to purchase, banks generally present a "counter-offer." It may be at a higher price than you expect, but they have to demonstrate to investors, shareholders and auditors that they attempted to get the highest price possible. You should plan to counter the counter-offer.

Your offer or counter-offer will probably have to be reviewed and approved by several individuals and companies. Even once an offer is accepted, the bank may insert wording like “..subject to corporate approval with 5 days."
Property Condition

Banks always want to sell a property in "as is" condition. Most will provide a Section 1 pest certification, but not unless you include it in your offer and negotiate the point. They will allow you to get all the inspections you want (at your expense), but they may not agree to do any repairs.

Your offer should include an inspection contingency period that allows you to terminate the sale if the inspections reveal unanticipated damages that the bank will not correct.

Even though you agreed to “as is," always give the bank another opportunity to make repairs or give you a credit after you’ve completed your inspections. Sometimes they’ll re-negotiate to save the transaction instead of putting the property back on the market, but don’t take it for granted.

Banks do not want to see a lot of proprietary disclosures; they are exempt from the California Seller’s Transfer Disclosure Statement (TDS-14). If there are real estate agents involved, either representing you or the bank, those agents are required to provide you their disclosure statements.

Some REO’s are in such poor condition it may be difficult to get a lender to lend on the property. Even the bank who owns the property may not even provide the loan. Some banks will provide financing on their REOs. So you definitely want to have a financing and appraisal contingency.

Making an Offer

Offers are usually FAXED to the bank. The listing agent needs your originals. There is no formal presentation. Keep in mind: nothing happens evenings and weekends since the banks are closed.

In Santa Clara County which by national standards is an active real estate market there are thousands of REO properties. Some localities have more REO’s than others. Where there are fewer REOs, areas like Sunnyvale, Mountain View, Santa Clara, Saratoga, and Cupertino don’t expect to get that great of a deal on an REO property. In areas like South San Jose, East Valley, Milpitas, Morgan Hill, Blossom Valley, and Gilroy, where REO’s and Short Sales make up a large percentage of the total inventory, you will see that prices have dropped significantly. This will include standard homes that are competeing with REO’s.

If you still want to buy an REO, make sure you find a Realtor who knows the market in the area you are looking, and can decipher if its a good deal or not.

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Should I Buy a Short Sale in the Santa Clara Valley?

vbrasil — Thu, 22 Jan 2009 17:28:10 +0000

Short sales happen when home values fall and sellers do not receive enough cash from a buyer to pay off their existing mortgages, providing lenders agree to take less than the amount owed to them.

On the surface, it may appear that a short-sale buyer is getting a good deal. Although a slim margin of short sales may be profitable for a buyer — because there are always exceptions — much of the time, a buyer would be better off buying a home that is not in default.

In Santa Clara County, where I work, for example, many agents ignore short sales like the plague.

Here are 9 Reasons Why Buyers Should Not Want to Buy a Short Sale:

1) Sellers Paid Too Much.

If a home sold for $500,000 a few years ago and is now for sale at $400,000, that doesn’t mean the buyer is picking up $100,000 of equity for free. It means the seller paid too much in a rising market and now the market has fallen. It means the seller has no equity.

2) Stringent Qualifications.

Inexperienced or unethical real estate agents might push a seller into considering a short sale when the seller does not qualify for a short sale. Sellers must prove a hardship and submit evidence of the hardship to the lender for approval. Some agents list homes as short sales without ever talking to the lenders or pre-qualifying the sellers. Thus this results in a waste of time for the buyers who are attempting to buy the short sale home.

3) Homes Sell at Market Value.

Lenders aren’t naive or unaware of the value of a home. Lenders will insist on a comparative market analysis, known as a CMA, or broker price opinion, known as a BPO. If a lender believes a better price can be obtained by taking the property back in foreclosure over a short-sale offer, the lender may hold out for a higher price. That price will be close to market value. In the Santa Clara Valley where some areas still have held on to their home values, like Cupertino, Sunnyvale and Saratoga lenders are less likely to take low offers.

Lenders will accept short sales when the home is worth the short-sale price, which means market value. Many buyers feel that they can get a deal on a short sale and in some cases they do, but that is more to do with the properties condition and frustrating process then the fact that the lender is relinquishing the property for a better price.

4) Homes Sell "As Is".

If a mortgage company agrees to a short sale, it is most likely also paying the closing costs in the transaction. Lenders ask buyers to purchase the home in its present condition. Lenders typically will refuse to pay for:

    * Suggested repairs disclosed on a home inspection.
    * Pest inspections or work necessary to issue a clear pest report.
    * Roof certifications or roof repairs.
    * Home protection plans for the buyer.
    * Deferred maintenance.

In a regular sale, sellers may be motivated to sell and offer up incentives and improvements to get their properties sold.

5) Length of Time to Close.

Depending on when the Notice of Default was filed, the lender’s back-log of foreclosures and how much paperwork the seller has already submitted, it could take anywhere from two weeks to two months to get a response on a purchase offer from a lender. In addition, if two lenders are involved because there are two loans secured to the property, it could take longer to satisfy the demands of the second lender.

6) Lenders Can Change Conditions.

Some lenders reserve the right to renegotiate the terms of the short sale at the last minute. If the market changes, new laws pass or new information crosses the lender’s desk, the lender can attempt to change the terms of the contract. Lenders generally have lawyers at their disposal, and ordinary buyers do not.

7) Higher Buyer Closing Costs.

Because lenders rarely will pay for any extras, like a seller would be willing to do, if you want any of those extras, you will pay for them yourself. Sometimes lenders will refuse to pay for standard seller closing costs such as transfer taxes, too. If you want specific inspections, you will probably pay for them out-of-pocket. Expect to pay higher transcation costs for short sales. You will have to pay for inspections to have the property inspected, and it has been my experience in areas like Santa Clara, Sunnyvale, and San Jose rarely will the lender agree to make any repairs or offer up any credits.

8) Lose Control of Transaction.

If you need to close escrow by a specific date, lots of luck with that. A short sale home closing process takes an indefinite amount of time. The seller’s lender calls the shots, not the buyer nor the buyer’s lender. If you are trying to close escrow concurrently with the sale of your home, it might not happen.

9) Little Seller Motivation.

When the seller discovers that the short sale effect on credit is identical to that of a foreclosure, there is little incentive for a seller to cooperate with a short sale. There is no benefit to a seller to consider a short sale and move out before the foreclosure is concluded, except for peace of mind that the nightmare is over.

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Prop. 60 & 90 Santa Clara County

vbrasil — Fri, 16 Jan 2009 04:17:38 +0000

Are you over 55 and thinking about selling your home and moving into something smaller, but worried about the tax implications when you relocate? If so, you aren’t alone. As the baby boomers find themselves approaching retirement age and becoming empty nesters, their housing needs are changing along with their lifestyles – but inflation and taxes just seem to keep going up, up, up. Fortunately some relief, in the form of Prop 60, is available.

What is Prop 60?

Proposition 60 is a constitutional amendment, approved by California voters, that provides property tax relief under certain circumstances. Essentially, what Prop 60 does is allow qualifying property owners to replace their primary residence with a new home of equal or lesser value and maintain their same tax base. Why, you might wonder, would anyone want to do that? Wouldn’t my property taxes be less on a home of lesser value? Not necessarily. With Prop 60, what is transferred is the Proposition 13 or “base year value” of the old home, which can be substantially less than the current market value of either home.

How can I qualify for Prop 60?

Both the original home and the new home must be located in the same county.

Both the original and replacement properties must be your primary residence.

Both properties must be eligible for the Homeowners’ Exemption or Disabled Veterans’ Exemption.

The seller or spouse residing in the home must be at least 55 years old when the original property is sold.

The replacement home must be of equal or lesser value than the current market value of the original home. There is a little wiggle room within this rule, depending on when the new property is purchased. For the purchase of a home (or completion of new construction) that occurs 1 to 2 years after the sale of the original home, the “equal or lesser” rule can change slightly. If the replacement home is purchased or moved into within one year you can purchase up to 105% of the value of the original home. If within two years you can go up to 110% of the value.

Purchase or completion of construction of the replacement property must be completed within two years of the sale of the original property, or you lose out.

Application for tax relief must be filed within 3 years of the purchase (or completion of construction) of the new home.

This is a once in a lifetime benefit. Neither spouse can file again.

How do I file for Proposition 60 tax relief?

Contact your county assessor’s office. The assessor will determine if the transaction qualifies and provide you with claim forms. Or have the title company handling your sale do it for you, my title company Chicago Title will take care of everything.

I’ve heard something about Proposition 90. What is that?

Proposition 90 is an amendment that permits the property owner to carry the benefits of Prop 60 throughout California. Each county in California has the option to accept tax base transfers from other counties, allowing qualifying homeowners more flexibility when planning a move. Counties are not required to participate, and currently there are only 7 counties in California that accept Prop 90. These counties include Los Angeles, Orange, Ventura, San Diego, Alameda, San Mateo and Santa Clara. This number is subject to change, as counties have the option to repeal their participation.

Prop 60 and Prop 90 are great extensions of Proposition 13, which was the initial break offered to the taxpaying public. If you think either might be something that will work for you, please consult your tax advisor or your county assessor for details.Similar Posts: