Alameda Inventory Update

I wanted to apologize to the regular readers of the 94501 Real Estate, I got slammed last week with the job and was unable to post most of the week. This week is no better but I will try to get five posts out even if I have to type into the wee hours of the evening.

So on to the Alameda Real Estate. . .

Alameda inventory data for the week is at the bottom of the post and you can look at the individual numbers, but the downward trend for inventory continues. With fewer homes on the market I believe the Alameda market will continue to stagnate.

This week’s low of 146 units ties a low back on February 1. This is also the fewest number of homes for sale in the 41 weeks that I have tracked Alameda home inventory.

What was also concerning to me was the increase in distressed properties for sale on the MLS. The increase was minimal, three additional properties, but none-the-less it was an increase. It shows that prices may have more room to drop.

The foreclosure and short sale properties have a median list price of $509,250. Of the 26 properties four are condominiums and 22 are single family. There are four homes under $400,000. It tells me that even at these price bargain hunters’ interest has not been peaked.

When you take a look at all other listed property the median list price is $683,500. Property at this price point becomes more difficult to find qualified buyers and acquire financing.

There is some good news, sales are up month-over-month and we will take a closer look at how August faired tomorrow.

Alameda Inventory Data

. . 8/30/2009 . Total 146 . 94501 118 . 94502 28 . SFR 98 . Condo 25 . Multi-Family 21 . Short Sale 14 . Foreclosure 12 . Price Reductions $62 . High List $1,987,000 . Low List $204,900 .

Alameda Bucks National Trends

Most of us know that Alameda is a different place to live and in the Real Estate world it does not follow state or national trends.

On Friday, the National Association of Realtors (NAR), reported home sales moved up in July, both the Bay Area and the nation, even though locally Alameda saw sales decline both month-over-month and year-over-year for the month.

The NAR is reporting sales are up for the fourth consecutive month. The Association show that sales were up 5 percent in July from a year ago to a seasonally adjusted 5.24 million units. Nationwide, it said, there is a 9.4-month supply of inventory for sale. A healthy market has about seven months of supply, so buyers still have a lot of inventory to select from in the market.

Based on yesterday’s Alameda Inventory numbers the Island has four months of inventory. The Island has been in the real estate doldrums as inventory has been depleted and sales have been slow the entire year.

DataQuick also released a report on Friday, they reviewed the nine-county Bay Area, that showed the median price for a home the Bay Area climbed month-over-month June's $360,000 median rose to a median price of $408,250 in July a 13.4 percent increase. The bad news is the median is still down 15.8 percent from a year ago when the median was $485,000.

Alameda saw a dip in the median from $599,000 in June to $582,000 in July, a three percent decrease. The year-over-year median price decrease was nine percent.

Inventory for foreclosures and low priced homes has dropped creating bidding situations. The result is intense competition for homes under $300,000 throughout the Nation driving prices up.

Alameda continues to buck the National trend in many ways, except for declining prices.

Alameda Inventory Data

. . 8/23/2009 . Total 153 . 94501 122 . 94502 31 . SFR 101 . Condo 28 . Multi-Family 22 . Short Sale 13 . Foreclosure 10 . Price Reductions $64 . High List $1,987,000 . Low List $224900 .

Alameda Snapshot: Webster Street Ad

Today's snapshot is from jayadewa of Fickr. The is a fantastic painted ad that is just off Webster street. It was restored a few years ago and is a true artistic piece on the street. I never have had a Golden Bridge Beverage, but the ad makes it look fun.

Have a great weekend.

P8096858
Originally uploaded by jayadewa

Alameda Tranfer Tax Revenue Update

I want to give an update to Alameda's Transfer Tax for 2009.

I wrote about the Transfer Tax back in March and in one of my first posts was about Measure P, so I just thought I should continue to update how much money the "Tax" is generating throughout the year. First the disclosure: all of the numbers reflect residential housing sales recorded on the MLS. Commercial building and private sales are not included so the numbers are higher than reported. The intent is to get a reflection of what is happening.


Link to Larger Graph

Given all the factors putting pressure on the housing market foreclosure, a soft job market, tight lending and scared buyers/sellers the impact is has been harsh in the number of sales and the revenue generated. In 2008, MLS sales accounted for $446 Million in sales with $167 Million coming in the first seven months of the year. Compare Alameda sales in 2009 and you see that the first seven months have generated $127 Million: a 24 percent decline in taxable sales. Under the old tax rate 2009 would have been over $215,000 decline.

From January 1 to July 30, 2009, there were 229 sales that represent over $127 million dollars in transactions. Under the newly enacted $12 per $1,000 the transfer tax generated $1,526,876 in revenue. If the Council had not made the change ($5.40 per $1,000) the revenue would have been $687,094; a difference of $839,781.

In the last blog post I said that In the short-term the tax may be one more factor for people not to buy, but given the stress on the City’s General Fund the tax may have been a necessary step.I think that this continues to be true.

I will continue to follow this topic at the end of each quarter to see how it is pacing.

Foreclosures Continue to Linger in The Market

Website RealtyTrac reported today that the foreclosure crisis has continued to deepen and has begun to touch areas that have previously been able to avoid much of the housing downturn.

Alameda current status according to RealtyTrac is:

Preforeclosure 94
Trustee Sale 64
Banked Owned 83

These numbers show a rise from June to July.

The rise in foreclosures is a trend nationally and there are new signs that the foreclosure crisis could be spreading to parts of the country that had previously been relatively unscathed. RealtyTrac reported spikes in foreclosures in states like Idaho, Oregon, Utah, and Illinois, where the prolonged recession is cited as the culprit.

Over the past two years the bulk of foreclosures were driven by a combination of risky lending practices and declining home values. The surge in foreclosures has been heavily concentrated in just four states — California, Florida, Nevada and Arizona. These four states accounted for well over half of all foreclosures last month, according to data from RealtyTrac.

The foreclosures appear to be driven by local unemployment. In Alameda County unemployment has gone over 11 percent and the job market continues to be very tight. Much of the flux in the home market will remain until unemployment settles down regionally.

Listed distressed properties in Alameda has seen small decrease this week, but over the past six weeks the number listed on the MLS has been about 13.

The government has slowed the pace of foreclosure with the institution of moratoriums and loan modification programs, but that also means that there is a hidden backlog or shadow inventory of home loans in default that could end up in foreclosure.

There have been several experts predicting a rise in foreclosures in the second half of this year. So it is something we will continue to monitor.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Alameda Inventory Continues to Fall

The interesting trend of falling inventory continues in Alameda as the number of units for sale fell to a 28-week low. Inventory for the Island was 150 units as of yesterday and much of the drop can be attributed to expired listings/withdrawn and condominium sales.

Part of the drop is the number of is not from sales with just 18 recorded so far for the month. The week, August 9-16, saw 14 properties listed on the MLS, so the drop of inventory is from the few sales and properties being pulled off the market.

Link to Larger Chart

August has seen a big run in the condominium market accounting for 50 percent of the sale. Nine of the 18 sales this month are condos a significant increase. The high for the year has been 10 condo sales in a month. For 2009 condos accounted for just 26 percent of the sales so it appears that a price bottom has been found for value shoppers.

The low inventory in a normal market creates demand. Basic economics: fewer homes in a desirable are drive up prices. But in this market I think it is stagnation, the homes that are sitting are sitting because there are no buyers. Fear of jobs, a tough Jumbo Loan market and lack of inventory has not brought buyers to the market.

It appears that sales continue to remain flat, an average of 30 per month, and will continue to remain in the same status until something significant changes.

Inventory Data

. 8/16/2009 . Total 150 . 94501 120 . 94502 30 . SFR 98 . Condo 29 . Multi-Family 21 . Short Sale 15 . Foreclosure 9 . Price Reductions 60 . High List $1,987,000 . Low List $199,000 .

Alameda Snapshot: Rhythmix Cultural Works

Rhythmix Cultral Works , Alameda , CA
Originally uploaded by Sharlenescom

Today's snapshot is from Flickr's Sharlenescom: Rhythmix Cultral Works on Blanding. The great sign for the artist collective and the shadows on the wall are interesting. Have a great weekend.

Alameda Sales Rise Quarter Over Quarter

The the National Association of Realtors announced in their latest survey that existing-home sales in the second quarter showed healthy gains from the first quarter in the vast majority of states, and price declines have increased affordability in most metro areas.

Locally in Alameda, the Island followed the national trend and recorded a 33 percent increase in sales from the quarter-to-quarter. The Island had 102 sales from April to June, a very nice uptick. The second quarter year-over-year is down 30 percent so sales still have a lot of room to grow to recover from even last year.

Nationally the total state existing-home sales, including single-family and condo, rose 3.8 percent to a seasonally adjusted annual rate1 of 4.76 million units in the second quarter from 4.58 million units in the first quarter, but remain 2.9 percent below the 4.90 million-unit pace in the second quarter of 2008. Thirty-nine states experienced sales increases from the first quarter, and nine states were higher than a year ago; the District of Columbia showed both quarterly and annual rises.

During the second quarter, 129 out of 155 metropolitan statistical areas reported lower median existing single-family home prices in comparison with the second quarter of 2008, while 26 areas had price gains.

http://farm3.static.flickr.com/2547/3815737646_5a28eb46e6_o.jpg

Alameda has been different in the area of median home price. The Island has seen the median price fluctuate between $502,000 to $586,000 during the first two quarters of the year. This has been fairly flat since the beginning of the year. The median is down from 2008 when the range was between $591,000 to $667,000.

Year over year, California showed double-digit gains from the second quarter of 2008 but are off from the first quarter of this year. The sharpest price declines continue to be concentrated in metros with high levels of foreclosures, including areas in California, Florida, Arizona and Nevada, where distressed homes comprise many of the transactions.

Nationally, Distressed sales – foreclosures and short sales – accounted for 36 percent of transactions in the second quarter, which continued to weigh down median home prices because they typically are sold at a 15 to 20 percent discount; first-time buyers accounted for one-third of transactions.

In Alameda foreclosures were 20 percent of all sales from January to June. For the first quarter it was 26 percent of sales and in the second quarter it fell to 14 percent of sales.

The second most expensive area in the second quarter was the San Jose-Sunnyvale-Santa Clara area of California, at $500,000, followed by San Francisco-Oakland-Fremont at $472,900.

Existing-home sales in the West declined 2.3 percent in the second quarter to an annual rate of 1.13 million but are 11.8 percent above a year ago. The median existing single-family home price in the West was $212,600 in the second quarter, which is 26.6 percent below the second quarter of 2008.

Video Link

http://link.brightcove.com/services/player/bcpid33388352001?bctid=33487138001

Alameda Housing Nearly Twice Equilibrium

Mike McMahon sent me an interesting article on a new method of measuring home affordability. The Sacramento Bee article is based on a study that tries to find an assumed "equilibrium level" of 15-to-1. This is the ratio of a home's cost and over the rental income the property could produce. The report was released by the Washington-based Center for Economic and Policy Research and the National Low Income Housing Coalition.

The example the Bee uses is, “a $150,000 that could rent for $10,000 a year is said to be in equilibrium. Any ratio above 15-to-1 is deemed inflated. In cities with those higher ratios, the report contends, renters are less likely to take the plunge into ownership”

The best way to look at this in Alameda terms is to reverse the equation and look at rental rates then look at home prices.

Below is a chart of the 15-1 ratio.

. Rent Annual Income 15-1 Ratio . $2000 $24000 $360000 . $2100 $25200 $378000 . $2200 $26400 $396000 . $2300 $27600 $414000 . $2400 $28800 $432000 . $2500 $30000 $450000 . $2600 $31200 $468000 . $2700 $32400 $486000 . $2800 $33600 $504000 . $2900 $34800 $522000 . $3000 $36000 $540000 . $3500 $42000 $630000 . $4000 $48000 $720000 . $4500 $54000 $810000 . $5000 $60000 $900000 .

Based on a quick check of Craigslist, three and four bedroom homes rent on average $2,090, from July 27 to August 10. The low side is in the $1,500 range and the high side as just over $3,000 per month.

Base on the rental rates there are three homes that fit into the 15-1 ratio.

The current active inventory of 159 home has an average list price of $686,000. Based on that number rental price would have to be at over $3,500 per month. The ratio for Alameda is 27.35 to 1 nearly double equilibrium.

As expected, cities close to the coast had higher ratios than those inland. According to the Bee article San Jose is the least attractive market for renters with a ratio of 29.4-to-1, even though declining home prices have dropped it from 35-to-1 in the past year. The study also lists the San Francisco-Oakland area (23.7-to-1) and Los Angeles-Long Beach (21.5-to-1) among the metropolitan areas with particularly high ratios, as well as San Diego (19.3-to-1), and Ventura (20-to-1).

Inland regions, where home prices have dropped more dramatically, have edged into the area of relative affordability including Riverside-San Bernardino (13.7-to-1), Bakersfield (14.7-to-1), Modesto (15-to-1) and Stockton (14.2-to-1). Fresno almost made the cut at 15.8-to-1.

The take away for me is you just do not buy in Alameda because it is affordable; it is the lifestyle choice that you pay a premium for in selecting a place to live.

Today’s Inventory Data: Just a quick note on inventory. Inventory has declined for three consecutive weeks and dipped below 160 units.

. 8/9/2009 . Total 159 . 94501 122 . 94502 37 . SFR 99 . Condo 36 . Multi-Family 22 . Short Sale 17 . Foreclosure 13 . Price Reductions 59 . High List $1,987,000 . Low List $224,900 .

Alameda Snapshot: Jim's Coffee Shop

Today's Alameda Snapshot is from my favorite breakfast place Jim's Coffee Shop. Corn Beef Hash and three eggs over. What's your favorite place?

Loan Mods Slow and Unproductive

Just a quick post today, I am off to Real Estate Connect in San Francisco a tech based real estate conference at the Palace Hotel. I will update any interesting items from the conference over at Twitter. To follow go to: http://twitter.com/johnoldham .

So on to the post . . .

So how is the Government’s loan modification program going?

In a nutshell slow and not very productive. The banks have been servicing very few of the eligible clients that could benefit from a change and according to government data released Wednesday, only 9 percent of an eligible 2.7 million borrowers had seen their mortgages modified under the new program as of the end of July.

The pace of loan modifications varies widely among lenders and servicers. The best results among large loan servicers came from Saxon Mortgage Servicers Inc. One in four of Saxon's 84,000 eligible borrowers has received a trial loan modification with a lower monthly payment. Aurora Loan Services, GMAC Mortgage and JPMorgan Chase all had one in five qualified borrowers in a trial loan.

Bank of America Corp and Wells Fargo & Co. — which have received billions in federal bailout money — were below average. BofA has modified just 4 percent of eligible loans under the program. Wells Fargo has modified 6 percent of eligible loans. Wachovia Corp., which was taken over by Wells Fargo last December, has modified just 2 percent. American Home Mortgage Servicing, with 153,000 eligible borrowers, was among the servicers that has not yet reported a single loan modification.

This could have a big impact on the Alameda Shadow inventory, those that are being threatened with foreclosure may not have the time need to modify their loans to save their homes. It seems that banks just do not know what to do, and in some case would rather have the property go into foreclosure than modify.

MSNBC had a great report on the lack of loan modifications.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Have We Seen The Bottom

On Tuesday, the National Association of Realtors released Pending Home Sales are up for the fifth consecutive month, the first time in six years for such a streak. In addition an assortment of economic reports and news articles have suggested that the U.S. housing market has bottomed out, but before you believe the experts I would like to take a wait and see attitude.

Given that there are so many unknown factors like shadow inventory, alt-A loans, loan modification, Jumbo Loan Market and job security -- the state of the housing market has very little stability and makes these claims that are very hard to believe.

Our little Island of Alameda, has been able hold off the cataclysmic events that have hit California and the Nation, but we have not been immune to falling home prices and loss of home value.

According to Zillow’s Home Value Index, Alameda peaked at $697,200 in late 2005 and has dropped $155,800 to $541,400 by early this year. The price per square foot for sold homes reached $449 and has fallen over $120 to $326. This has rebounded the last couple months, but the numbers have not been consistent.

This trend continues in other part of the San Francisco Bay where residential real estate has fallen dramatically in areas like Antioch, where the Zillow Price Index went from $516,800 to $203,100 a 61 percent decline. The Antioch prices per square foot dropped from $240 in late 2007 to around $100 today. The ratios are similar for Vallejo and Richmond.

It appears high valued areas still have plenty of room to fall. Affluent communities like Piedmont, Marin, and Palo Alto that also saw a doubling or tripling of home prices during the boom, even though their residents' salaries have not followed suit.

For many part of the Bay Area residential rents are not aligned to reflect the home prices. This is a sign that home prices may have further to decline. Alameda has a situation where rent on a home is roughly $2,500 and the mortgage of a $550,000 home with 10 percent down payment is over $2,900 not including homeowners insurance or taxes. My guess it will cost you about 30-percent more to own than rent an equivalent home. This type of ratio makes it difficult for people to make the move.

So before people start declaring that we have hit bottom continue to watch employment, inventory and interest rates. These factors will let you know when we hit bottom and have begun to recover.

More on July Sales: The Band Says

I wanted to dive more into the July sales for Alameda and look to see how sales fell into pricing bands.

The sweet spot for home sales in Alameda is in the half million dollar range. Of the 35 sales, in the intial sales data, showed that 15 fell between $500,000 and $599,000. This accounted for 43 percent of the sales.

The next largest band was the $600,000 range that represented 20 percent of the sales. Once you climbed into this band and above all the home sales were single family residences.

It appears that the inventory of homes under $400,000 is falling off and so are the sales. The Island saw just three sales below the 400K level. Alameda currently has 25 listings in the lower end of the bands.

So what does all this mean. If you are a home seller, with a property above $700,000 you have very few shoppers looking in that range right now. If you are a buyer looking below $400,000 there are properties but the inventory is shrinking.

. Total Number of Sales . $1-$299,999 1 . $300,000-$399,999 2 . $400,000-$499,999 3 . $500,000-$599,999 15 . $600,000-$699,999 7 . $700,000-$799,999 5 . $800,000-$899,999 1 . $900,000-$999,999 1 . . SFR . $300,000-$399,999 1 . $400,000-$499,999 1 . $500,000-$599,999 10 . $600,000-$699,999 6 . $700,000-$799,999 5 . $800,000-$899,999 1 . $900,000-$999,999 1 . . Condo . $1-$299,999 1 . $300,000-$399,999 1 . $400,000-$499,999 2 . $500,000-$599,999 3 .

July is Uninspiring, Sluggish, and Downright Tepid

The preliminary Alameda sale data for July is in and the numbers show another uninspired month for home sales on the Island. First the disclaimer, MLS data is slow so these numbers may go up and I will check them again next week. The early numbers reveal 35 sales for the month.

In a year-over-year comparison sales are down 38 percent. In what is suppose to be the traditional sale season for real estate, the City of Alameda continues to be sluggish as other part of California have begun to heat up.

On reason is the median and average price of Alameda homes. For July the median was $582,000 and the average sale price was $590,652. In a Wall Street Journal report today, homes at the upper end continue to see sales remain in a deep slump and price declines are expected to accelerate in these areas.

The article points out those homes over $750,000 continue to grow in terms of inventory and days on market. Since Alameda has a significant amount of inventory over $500,000 it is not a surprise that sales have been sluggish at best. In addition, the Jumbo loan market has not made it any for buyers looking into Alameda property.

The most interesting item that came out of these months sales was a trend up on the number of properties that sold for over list price. More than half of the properties got offer for at least the list price. Seventeen properties sold at or above list price. I think this is very noteworthy, because if this continues we can see the return of multiple offers.

Here is breakdown of the sales. The 94501 account 26 of the 35 sales (74%), the 94502 had nine sales. Twenty six of the sales were single family residences, 7 condos and 2 multi family.

The highest priced sale was at Bayport, where a five bedroom, four bathrooms home sold for $923,000. The lowest priced property was a one bedroom, one bathroom condo that sold for $135,000.

Alameda Inventory as of August 2, 2009

. 8/2/2009 . Total 168 . 94501 131 . 94502 37 . SFR 108 . Condo 36 . Multi-Family 22 . Short Sale 15 . Foreclosure 13 . Price Reductions 66 . High List $1,899,000 . Low List $224,900 .