Realtors Encouraged by Signs that Economic Recovery

With the holidays behind us and a brand new year underway, Realtors, home sellers and buyers are all wondering what 2011 will bring to the Bay Area housing market. After a choppy 2010 that saw strong activity early in the year and a softening in the second half, Realtors are encouraged that recent improvement in the economy could bode well for the housing market.

The real estate market is so closely aligned with the fate of the overall economy, the stock market and consumer confidence. In general, all three of those economic indicators have been recovering in recent weeks. And this week in particular gave housing market professionals reason for encouragement.

In his first appearance before the new Congress, Fed Chairman Ben Bernanke gave a more upbeat assessment of the economy than he has in the past. "We have seen increased evidence that a self-sustaining recovery in consumer and business spending may be taking hold," the central bank chief told lawmakers.

Bernanke and another senior Fed official, New York Fed President William Dudley, said today that leading indicators for the labor market are pointing to a likely pickup in the pace of employment gains over the course of the year.

At the same time, the financial markets have rallied in recent months. The S&P 500 and the NASDAQ have risen 10% and 12%, respectively, over the past three months. Many Silicon Valley companies continue to report strong sales and profits over the past year. All of this undoubtedly is having a positive impact on consumer confidence.

Finally, this past year’s holiday season provided some welcome news for retailers. U.S. retailers posted the strongest revenue growth since 2006. A Thomson-Reuters index of 28 leading retailers showed sales rose 3.1% at stores open less than a year.

But in all likelihood, the road to recovery will continue to be slow and occasionally bumpy. Don’t be surprised to see extremely upbeat economic numbers one month and a small setback the next.

For example, the Labor Department reported that the nation's economy added 103,000 jobs in December and the unemployment rate dropped to 9.4% last month, its lowest level in 19 months. But the job growth fell short of expectations based on a strengthening economy. And the drop in unemployment was partially due to people dropping out of the labor force.

Nonetheless, despite two steps forward and one back, the overall economy appears to be trending upward. I’m cautiously optimistic the same will be true for our housing market in 2011.

http://www.cloneyrealestate.com

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Real Estate Market in Marin County!

The real estate market in Marin County is always a favorite topic of discussion at work, the park, or a party. People will often ask. "Are prices going up or down?" "How long will rates hold before they go back up? "Is the rising unemployment rate going to make for another price drop on Real Estate in Marin County?"

All great questions, and everyone has their own answers.

But 2010 has brought forth another question, one that many home buyers and sellers are asking. One that has got even the realtors scratching their heads. "When is the new spring time inventory going to hit the market?" The normal timing is often right after the Super Bowl.

Many potential sellers are not putting their homes on the market, because they are not convinced they will be able to find a replacement property. This of course compounds the problem even further.

Limited supply in the Real Estate Market in Marin County is one of the age old causes of price holding firm, or appreciating. This has started to work in some instances, but has not been totally successful for many areas. The available listing inventory at the end of February was lower than it has been in more than 3 years.

Although the Real Estate Market in Marin County had 31 sales in the past week, many homeowners do not have the same happy news report. 730 homes come off the market in the past 6 months, because they didn't sell. Another 215 have been on the market for more than 100 days.

Another market challenge is the major change in financing. Most loans are sold off by whomever does the origination, within several months of closing. Many of the institution, and even foreign counties that have purchased our mortgage debt by the billions over the past 5 years, have drastically cut, or stopped buying it altogether.

The amount of demand on Real Estate Market in Marin County usually has a more significant impact in the prices than supply. No past graphs or trends can predict the future for 2010. We are in uncharted waters. But if you have dependable employment, or money to invest, now is a good time to buy. Home prices and interest rates, are not often low at the same time. Upward pressure in mortgage rates is coming. If rates move up, before unemployment goes down, that will not help the recovery process for homeowner equity. Bottom line... rising interest rates are usually not conducive to real estate appreciation.

Buying a home in Petaluma!

http://www.cloneyrealestate.com Just sold a beautiful home in desirable Petaluma! This was a short sale which took a good three months to close, but in the end, the buyer's got a great home and a great deal. This East side home is located next to schools, shopping, and transportation. Homes in Petaluma are selling quickly when priced correctly due to the $8,000 tax credit for first time home buyers. Also, interest rates are under 5% at the moment and home prices are at an all time low. 85% of the homes for sale in this area are either short sales or foreclosures, which make for hot prices on homes.

If you are looking to buy a home in Petaluma, or would like to know what is happening in the Real Estate world, please give me a call and we can discuss some options that will fit your needs!

The Market has changed!

Today, I am sitting in my office scratching my head wondering how the market went from homes not selling to not being able to find a home for my buyers. Well the market has been controlled by the short sale and REO/Foreclosure market for the past three years. Now, the president has encouraged the banks to help homeowners keep their homes. So we have not seen very many homes coming into the market over the past 3 months. It appears that things are heading in the right direction towards a recovery. I am also hearing that mid summer, we are going to see many more foreclosures hit the market. This would be a great opportunity for many first time home buyers. The bottom line is that if you are on the fence thinking about buying and don't react soon, you will be scratching your head too while saying "I just missed a great opportunity to own a home."