OCTOBER/NOVEMBER 2011

Inside This Issue

Gwen Wang
Keller Williams Realty 505 Hamilton Ave., Ste. 100 Palo Alto, CA 94301 (650) 454-8568 (415) 225-4936 [email protected] http://homes-for-sale-PaloAlto-today.com
http://www.MenloRealEstate.com
DRE #01393647

> LOCAL MARKET TRENDS ..................... 1 > MORTGAGE RATE OUTLOOK ............... 2 > HOME STATISTICS .............................. 2 > FORECLOSURE STATS ........................ 3 > CONDO STATISTICS ............................ 3 > ANNUAL TABLES ................................. 4

Steve Jobs R.I.P. Thank you.

The Real Estate Report local market trends

SANTA CLARA COUNTY

Mortgage Rates Reach Record Lows

Thirty year fixed mortgage rates are down in the low, very low, 4% area. Which is great for those who have the down payment, minimum 3.5% for FHA-backed loans and 5% for bank loans, and can qualify. Those few, those lucky few. (With all credit to Shakespeare's St. Crispin's day speech.) Then there are the people who would love to refinance, but are underwater. So sorry! Then again, this is Silicon Valley!!! Where many of the rules that apply to normal people don't exist. Dot.com and IPO millionaires are pushing prices up in select cities, where multiple offers rule. Of course, these buyers are usually taking out jumbo loans which are about one percent higher. Record low interest rates are having NO affect on the market. In other news, foreclosure starts surged in August, with Bank of America leading the way by nearly doubling their initial notices of foreclosure, according to http://foreclosureradar.com. In Santa Clara County, According to http://foreclosureradar.com, the number of bankowned properties, called REOs, in Santa Clara County have averaged about 2,200 for the past thirteen months. In the MLS, there are 255 properties listed for sale as REO. We are only counting active listings, not pending-continue to show, which the MLS counts as active. There are 302 REO properties pending. That totals 557 REO properties either for sale or in escrow. Thats only 25% of all bank-owned properties in play.

Trends at a Glance
(Single-family Homes) Sep 11 Aug 11 Sep 10 Median Price: $ 570,000 $ 600,000 $ 628,000 Av erage Price: $ 718,707 $ 766,252 $ 762,435 Home Sales: 840 992 837 Pending Sales: 1,829 1,934 1,987 Inv entory : 2,154 2,222 2,931 Sale/List Price Ratio: 99.0% 99.3% 99.2% Day s on Market: 52 51 49

median price for homes has been lower than the year before. The median price for condos was up 0.5% compared to last September, breaking a string of twelve months in a row where the median price had been lower than the year before. Inventory of both homes and condos continues to be weak. Home inventory was down 26.5% compared to last September: 2,154 homes actively listed. Please note, only active listings are included in this figure. Numbers from the local associations include properties that are also in a pending status, meaning they have an accepted offer, but havent been taken off the market. Condo inventory was down 41.7% year-over-year. Please remember, while statistics are nice, they will not determine the price you pay or get for a property. That will come down to you and the buyer or seller.

MARKET STATISTICS
Sale of single-family, re-sale homes fell 15.3% in September from August, but were up 0.4% yearover-year. Year-to-date, home sales are up 0.3%. Condo sales followed a similar, down 19.4% from August and up 8.3% year-over-year. Year-to-date, condo sales are up 10.9%. There have been more condos sold this year than any year since 2007. The median price for homes was down 9.2% yearover-year. This is the eleventh month in a row the

Santa Clara County Homes: Sales Momentum

60.0% 40.0% 20.0%

0 FMAMJ JASOND0 FMAMJ JASOND0 FMAMJ JASOND0 FMAMJ JASOND1 FMAMJ JASOND1 FMAMJ JAS 7 8 9 0 1 -20.0% 6 -40.0% -60.0% Sales Pendings Median 2011 rereport.com

0.0%

Gwen Wang | [email protected] | (650) 454-8568

The Real Estate Report

Mortgage Rate Outlook

30-Year Fixed Mortgage Rates
07-11 04-11 01-11 10-10 07-10 04-10 01-10 10-09 07-09 04-09 01-09 10-08 07-08 04-08 01-08 10-07 07-07 04-07 01-07 10-06 07-06 04-06 01-06 10-05 07-05 04-05 01-05 3.0%

Sep. 30, 2011 -- HSH.com's broad-market mortgage

tracker -- our weekly Fixed-Rate Mortgage Indicator (FRMI) -- found that the overall average rate for 30year fixed-rate mortgages increased by two basis points (0.02%) from last week, moving just off new record lows to end the week at an average of 4.36%. FHA-backed 30-year fixed-rate mortgages, especially important to first-time homebuyers and low-equity refinancers held steady at an average interest rate of 3.99%.

pants. The 162,000 units available is a record low and a continuation of a slow dwindle in the stockpile. At some point, builders will need to begin to replenish inventories, but that seems to be well off in the future at the moment.

4.0%

5.0%

6.0%

7.0%

8.0%

The sooner we get some hiring, the faster that day will come. While the nation's September employment report isn't due until next Friday, perhaps the best news on the labor front in a while came out Thursday, when initial filings for new unemployment beneAlthough it's hard to recommend ARMs at a time of fits soundly broke below the 400,000 mark for the first time since July. The 391,000 new applications such low interest rates, a case can still be made for them for some borrowers. Hybrid 5/1 ARMs, the most for benefits was the lowest figure since the Spring, popular kind among adjustable rate products, saw and a welcome sign, but the large downshift from last week (a decline of 37,000) seems a little suspect and their five-year fixed-rate periods post a three-basislikely to be revised. Still, any move downward is welpoint rise to finish HSH's survey at a still-incredible come, and perhaps the employment report next week 3.09%. may beat market forecasts which expect a only very Even with record low mortgage rates, sales of new slight increase in hiring. homes remain weak. The annualized 295,000 homes sold by builders in August was a step down of 7,000 Hiring would bring more wages; more wages would from July but not all that far from the range of the last bring more spending, and more spending would bring six months, all which hung around the 300,000 mark. stronger economic growth. At this sales pace, there is a 6.6 month supply of homes ready for sale, which translates into about 162,000 actual units completed and ready for occu-

$1,100 $900 $700 $500 $300 $100 0FM AMJJAS OND0FM AMJJAS OND0FM AMJJAS OND0FM AMJJAS OND1FM AMJJAS OND1FM AMJJAS 6 7 8 9 0 1

1,100 900 700 500 300 100

Santa Clara County - September 2011

Single-Family Homes
Cities County Campbell Cupertino Gilroy Los Altos Los Altos Hills Los Gatos Milpitas Monte Sereno Morgan Hill Mountain View Palo Alto San Jose Santa Clara Saratoga Sunny v ale Prices Median Average Sales Pend Inven $ 570,000 $ 718,707 840 1,829 2,154 $ 644,000 $ 685,014 20 42 53 $ 1,065,500 $ 1,088,940 20 37 67 $ 387,000 $ 458,182 46 133 134 $ 1,502,480 $ 1,755,560 27 24 59 $ 2,060,000 $ 2,115,140 5 6 48 $ 1,262,500 $ 1,234,730 22 43 107 $ 440,000 $ 507,949 22 47 63 $ 1,600,000 $ 1,694,330 3 3 9 $ 487,500 $ 550,470 34 84 134 $ 970,000 $ 980,486 22 23 32 $ 1,362,500 $ 1,600,030 32 29 54 $ 481,500 $ 544,756 468 1,150 1,044 $ 547,000 $ 605,555 48 87 77 $ 1,547,500 $ 1,581,640 20 29 120 $ 898,500 $ 800,997 42 70 78 DOI 74 77 97 84 63 278 141 83 87 114 42 49 65 47 174 54 SP/LP 99.0% 97.2% 100.6% 99.9% 98.8% 96.1% 97.3% 96.1% 89.9% 97.2% 102.2% 103.4% 98.8% 98.4% 99.2% 101.6%

% Change from Year Before

Prices Med Ave -9.2% -5.7% 3.4% 1.9% -3.1% -1.6% -6.7% 6.3% 1.8% 4.3% -18.9% -20.8% 11.4% -5.3% -15.4% -11.0% 3.2% 9.3% -33.3% -25.8% 10.7% 2.8% -1.5% 11.6% -5.6% -5.1% -4.9% 2.3% -7.3% -7.2% 11.6% 4.6% Sales 0.4% 33.3% -39.4% 70.4% 42.1% -28.6% -31.3% -12.0% 200.0% -5.6% -4.3% -5.9% 3.8% 4.3% -13.0% -20.8% Pend2 -8.0% 16.7% -17.8% -0.7% -33.3% -50.0% -12.2% -32.9% -66.7% -3.4% -28.1% -38.3% -5.3% 11.5% -12.1% -5.4% Inven -26.5% -20.9% -18.3% 6.3% -11.9% -20.0% -26.7% -1.6% -59.1% -8.8% -46.7% -46.0% -30.5% -35.8% -11.1% -40.9%

Page 2

Single-family Hom e Sales

Median & Average Prices

The chart above shows the National monthly average for 30-year fixed rate mortgages as compiled by HSH.com. The average includes mortgages of all sizes, including conforming, "expanded conforming," and jumbo.

Santa Clara County Homes - Prices & Sales

(3-month moving averageprices in $000's) $1,300 1,300

Santa Clara County Homes: Year-Over-Year Median Price Change

40.0% 30.0% 20.0% 10.0% 0.0% -10.0% -20.0% -30.0% -40.0% -50.0% 0 FMAMJ JASOND0 FMAMJ JASOND0 FMAMJ JASOND0 FMAMJ JASOND1 FMAMJ JASOND1 FMAMJ JAS 6 7 8 9 0 1

FORECLOSURE STATISTICS
Notices of default, the first step in the foreclosure process, in Santa Clara County surged 55.6% in August from July, and they were 11.3% from last August. Notices of sale, which set the date and time of an auction, and serve as the homeowner's final notice before sale, rose 5.5% from July, but were down 18.2% yearover-year. After the filing of a Notice of Trustee Sale, there are only three possible outcomes. First, the sale can be cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements. Alternatively, if the property is taken to sale, the bank will place the opening bid. If a third party, typically an investor, bids more than the bank's opening bid, the property will be sold to the third party; if not, it will go back to the bank and become part of that bank's REO inventory. In August, cancellations were down 25.9% year-overyear, and down 8.3% from July. Properties going back to the bank declined in August by 27.5% compared to last August. They were down 3.6% from July. The total number of homes that have had a notice of default filed increased by 4.8% year-over-year. The total number of homes scheduled for sale declined by 5.4% year-over-year. The total number of homes owned by the bank was down 3.9% year-over-year.

Santa Clara County Condos- Prices & Sales

(3-month moving averageprices in $000's) $600 $550 $500 $450 $400 $350 $300 $250 $200 $150 $100 550 500 450 400 350 300 250 200 150 100
Median & Average Prices

Condo Sales

Table Definitions _______________ Median Price

The price at which 50% of prices were higher and 50%were lower.

Average Price
Add all prices and divide by the number of sales.

0FM AMJJAS OND0FM AMJJAS OND0FM AMJJAS OND0FM AMJJAS OND1FM AMJJAS OND1FM AMJJAS 6 7 8 9 0 1

SP/LP
Santa Clara County - September 2011
Condos/Townhomes
Cities County Campbell Cupertino Gilroy Los Altos Los Gatos Milpitas Morgan Hill Mountain View Palo Alto San Jose Santa Clara Saratoga Sunny v ale $ $ $ $ $ $ $ $ $ $ $ $ $ $ Prices Median Average Sales Pend Inven 321,500 $ 363,375 312 810 669 349,000 $ 360,950 10 22 29 612,000 $ 683,857 7 9 16 125,950 $ 125,950 2 3 3 575,000 $ 575,000 1 4 6 535,000 $ 539,875 8 19 38 358,000 $ 324,818 11 40 19 219,000 $ 209,167 3 18 12 515,000 $ 549,670 19 38 37 799,000 $ 829,622 11 13 18 265,000 $ 293,923 183 536 406 288,500 $ 345,941 30 59 29 $ 0 0 0 448,888 $ 440,531 27 44 48

% Change from Year Before

Prices DOI SP/LP Med Ave Sales Pend2 Inven 62 99.0% 0.5% -1.2% 8.3% 4.7% -41.7% 84 99.1% -14.9% -8.5% -33.3% 4.8% -17.1% 66 100.3% 7.4% 18.4% -50.0% 28.6% -46.7% 44 97.6% -31.9% -32.2% -33.3% -62.5% -40.0% 174 95.8% -47.7% -47.7% 0.0% -20.0% -71.4% 138 99.8% -22.9% -19.7% 0.0% 90.0% -15.6% 50 97.7% 34.8% 11.2% 10.0% -7.0% -53.7% 116 97.6% -30.5% -32.7% -78.6% -18.2% 0.0% 56 98.5% -15.6% -6.2% 0.0% -17.4% -63.7% 47 97.7% 4.9% 12.5% 83.3% -35.0% -53.8% 64 99.4% -1.9% -0.5% 6.4% 5.3% -36.8% 28 98.9% -3.8% 0.6% 100.0% 22.9% -59.7% 0 0.0% n/a n/a n/a n/a n/a 52 97.6% -19.1% -10.9% 200.0% 51.7% -45.5%

Sales price to list price ratio or the price paid for the property divided by the asking price.

DOI
Days of Inventory, or how many days it would take to sell all the property for sale at the current rate of sales.

Pend
Property under contract to sell that hasnt closed escrow.

Inven
Number of properties actively for sale as of the last day of the month.

Page 3

THE REAL ESTATE REPORT

Santa Clara County Gwen Wang
Keller Williams Realty 505 Hamilton Ave., Ste. 100 Palo Alto, CA 94301 (650) 454-8568 (415) 225-4936 [email protected] http://homes-for-sale-PaloAlto-today.com http://www.MenloRealEstate.com

Santa Clara County

Sales Year-to-Date
20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

2003 2004 2005 2006 Condos 4,147 5,374 5,099 3,976 Homes 10,238 12,931 12,057 9,129

2007 3,168 7,511

2008 2,185 6,838

2009 2,606 8,318

2010 2,734 7,910

2011 3,032 7,937

The Real Estate Market Trends Report is published and copyrighted by http://rereport.com.