100,000 Reasons to Buy Now, Even in What Looks Like a Seller’s Market in Marin

If you’re considering purchasing a home in the Bay Area, you’re probably hearing plenty about limited inventory, multiple offers, price increases, and other economic news that sounds good for sellers but not so great for buyers.

But we can give you one huge reason to buy now anyway: $100,000 in extra purchasing power.

Our partners at Mortgage Services Professionals point out that today’s historically low interest rates allow you to take a mulligan on any increase in prices — and purchase a home at a higher price while keeping your monthly outlay very similar.

Here’s how that works. Let’s assume you are ready to buy a home and these are your criteria:

• You’re getting a 30-year, fixed-rate mortgage
• You’re planning to put 20 percent down
• You’d like to end up with a monthly mortgage payment of about $3,600

Assuming an interest rate of 4.5 percent, you could purchase a $900,000 home.

But if you wait until rates creep up even 1 percent, the best you’ll be able to do is purchase an $800,000 property.

Take a look at the math:

Interest Rate	Home Price	Down Payment (20%)	Monthly Payment
4.50%	$900,000	$180,000	$3,648.13
5.50%	$800,000	$160,000	$3,633.85

In other words, taking advantage of today’s interest rates will allow you to have an extra $100,000 in purchasing power.

You don’t need to look back at the opportunities of 2011 and feel like you’ve missed the boat. To the contrary, the buyer who acts now can become the captain of their real-estate destiny!

(story courtesy of Pacific Union and image courtesy of woodleywonderworks via Flickr)

Marin County (and Bay Area) Home Sellers Making The Most Of Constricted Inventory Environment in Q1 2012

For months, constrained inventory in Marin County has resulted in quick and painless sales for realistic home sellers. Indeed, competitively priced homes are selling at a pace we have not seen since the slowdown in real estate, which began in 2005 and was painfully evident by the end of 2007 and early 2008 (depending on neighborhood). All cash buyers are eager to buy. Buyers who need to obtain financing are getting nervous about rates and prices rising. This is a topic that we have been discussing at Pacific Union since Q3 2011 — really, as soon as the silliness related to the United States’ debt ceiling resolved and buyers regained their confidence in the market, sales have been fast and furious in Marin and throughout the Bay Area (assuming sellers are realistic in their pricing and purchase price expectations). See excerpt below from Mark McLaghlin, CEO of Pacific Union International (PUI), from earlier today:

Market dynamics are setting the stage for an amazing post-Super Bowl selling season, absent one critical ingredient. Sellers need to join the party!

In all six counties served by PUI, listing inventory is well off the levels late August 2011 (08-29-11 to be exact). By contrast properties under contract are growing at accelerating and exciting rates.

County	All Listings – 02-12-12	Under Contract Increase Since 01-02-2012
Alameda	-26.5%	+57.8%
Contra Costa	-27.1%	+60.2%
Marin	-34.1%	+82.1%
Napa	-21.6%	+37.5%
San Francisco	-33.7%	+97.5%
Sonoma	-28.7%	+65.1%

As a seller, this may not be the “perfect storm”, which would include accelerating appreciation, but we have not seen market dynamics like this since pre-2005.

Many of our listings are receiving multiple offers (2-5), tight terms, ultra-competitive closing timelines, pre-approved mortgage commitments with rates at 4.0% – 4.5%, and an ample supply of “all cash”.

Buyers are more confident than we have seen in the past 20 months and the Bay Area economic forecast and job markets seem stable if not encouraging.

Although I rarely do this, I have attached market reports for all six counties and a copy of my recent e-mail about the Wall Street vs. Apple, Google and Facebook impact on our markets [Let me know if you would like a copy of these].

In Marin County, properties sold (there were 21 trades) between $1 and $2 million in Marin County in January ’12 with 60 DOM or less, achieved closing prices of 98.7% – 101.2% of list price.

Most sellers should welcome these market dynamics!

I would be happy to create a digital comparative market analysis for you that is property specific — this way, you can track what is happening around you. If you want to sell now, I would be happy to talk with you about how I can help you reach your goals. Create your own opportunity! If you are thinking of a lifestyle change, now may be the perfect time. Keep in mind that prices are not likely to increase to pre-meltdown highs for 10 years.

Job Security in Bay Area (Especially Marin) Gives Rise to Strong Real Estate Market — Pacific Union International

[The below article by Mark McLaughlin, CEO, Pacific Union International]

Things are looking up for the country’s job situation and are even rosier in the Bay Area.

And that’s great news for the real estate markets – because a healthy Bay Area job outlook drives consumer confidence, purchasing, borrowing, and home buying.

The highlights from last week’s U.S. Labor Department employment report:

• The nation’s jobless rate dropped to a near-three-year low
• Unemployment fell to 8.3 percent in January from 8.5 percent in December
• The drop marks the fifth consecutive monthly decrease
• Job gains of 243,000 (net new) blew away economists’ expectations of a gain of only 150,000

As good as that sounds, things in the Bay Area are even better.

There are three factors swinging our way that are pushing us onward and upward.

1. We’re Not California
At the risk of sounding flippant, Northern California – and specifically, the Bay Area – isn’t “California.” There’s an important distinction between our state as a whole and our little slice of home. Although California’s overall unemployment rate of 11.1 percent is still higher than the U.S. average, that doesn’t hold true for the Bay Area.

According to the December county data from the California Employment Development Department, which were released last week, the six Bay Area counties we serve outperformed the California unemployment rate – and Marin and San Francisco rates were even lower than the national average.

Location	December 2011 Unemployment Rate
Marin County	6.5%
San Francisco County	7.6%
United States	8.3%
Sonoma County	8.9%
Alameda County	9.3%
Contra Costa County	9.3%
Napa County	9.0%
California	11.1%

In all cases except in Napa County, the rates had dropped from the previous month — and without exception all represented decreases from December of last year.

2. The Rolling Tech Tide
We have an added stimulus in our thriving technology industry, which is continuing to power healthy movement across various economic sectors. If this keeps up, we might even be willing to use the word “recovery” in tones louder than a whisper.

Bloomberg reported last week that hiring in the technology sector is gaining momentum. Among U.S. technology companies with a market value of more than $100 million, almost 50 increased employment by more than half in the most recently reported two-year period. And 74 expanded their workforces by more than 10 percent – more than any other industry group measured by Bloomberg.

The continuing trend of job creation in the tech industry should serve to support the declining unemployment rates and instill increasing confidence in Bay Area real estate markets.

3. The Facebook Factor
Finally, you can add the coming Facebook IPO into the mix. It’s an event expected to turn about 900 Facebook employees into instant millionaires (and a few billionaires) and will surely cause a ripple effect in spending on real estate, travel, and consumer and luxury goods.

In addition, the IPO will likely spur additional job creation, both within Facebook and in new start-ups as well as in companies already working with or leveraging the platform. The Facebook IPO effect could boost other sectors and even the U.S. economy as a whole, a position articulated by the DailyFX, a publication by the foreign exchange market (Forex), last week:

“With a history of acquiring companies that it believes could be complementary to its core business, investing in new developments and vast overseas expansion, many investors believe that the additional cash raised by Facebook could flow into other sectors such as advertising and marketing. The potential for job creation could help boost the U.S. economy, and accordingly the U.S. dollar.”

What’s Ahead for Us?
This is likely the first time since 2007 that we have enjoyed consistent and positive trends in economic indicators. Most of our markets currently have more qualified buyers than we do realistically priced homes, and we are seeing the return of multiple serious offers on well-priced homes.

We see this optimistic economic news as a stabilizer to our local real estate markets, although it’s not yet a catalyst for price appreciation.

However, the increasingly positive employment outlook coupled with our somewhat supply-constrained real estate environment will likely encourage home owners to list their properties and make the trade-up, relocation, or lifestyle changes that they have previously deferred until now.

Mark A. McLaughlin is Chief Executive Officer of Pacific Union International, Inc.

(San Francisco skyline image courtesy of Michael Larson via Flickr)

Marin Luxury Properties Report Pacific Union – Christie’s International Real Estate | Marin County, CA Luxury Home Sales (January 2012)

Pacific Union Int’l – Christie’s Great Estates | Marin County, CA Luxury Home Sales (January 2012) — Luxury home sales have maintained a solid pace over the past quarter (in December 2011, Marin County saw 9 sales over $2 million). It remains very clear that buyers will act quickly, even in the luxury home realm when they feel a particular home reflects clear value and/or possesses unique and desirable characteristics. Extraordinary opportunities are literally around every corner for buyers who can stomach uncertainty — although, it appears, the level of uncertainty has diminished fairly significantly over the past 6 months. Indeed, pricing in the marketplace (especially for homes that started off overpriced) remains on the soft side and “value” is evident in virtually every locale and every price segment of the luxury home market in Marin.

In line with normal seasonal adjustments (we are approaching the end of the slow season), the inventory of luxury homes remains constricted with just 81 properties actively listed over $2 million in Marin. This inventory level is lower than years past as prices have declined substantially in many markets (e.g., such that homes that priced at $2.25 million in 2006 are now priced below $2 million). Moreover, to the extent sellers do not have a compelling reason to sell now, most are waiting for prices to recover rather than trade in today’s market.

[Click HERE for the rest of the article, courtesy of www.ImagineMarin.com]

By: Kyle Frazier, J.D. & Broker, Certified Luxury Home Marketing Marketing Specialist (CLHMS), Certified Residential Specialist (CRS), Realtor with Pacific Union | Christie’s International Real Estate. Call Kyle Frazier at 415/350-9440 for more luxury home market information in Marin County, California (the San Francisco Bay Area’s “North Bay”).

Tiburon / Belvedere Home Sales & Real Estate | January 2012 | Pacific Union International

As with most segments of the Marin real estate market over the past few months, Tiburon and Belvedere home sales continue to improve — in December 2011, we experienced 10 trades. Tiburon and Belvedere properties that sold in December 2011, exhibited the following characteristics:

Number of Sales: 10
Average Days on Market: 143
Price: $2.355 million
Square Feet: 3,087
Price per Square Foot: $797

If you have any questions or would like a custom market analysis of your home’s current likely sales price (I specialize in selling homes that have been listed before unsuccessfully — expired listings), please call me at (415) 350-9440 . And if you are a buyer, I am also a member of the Top Agent Network (Top 10% in Marin County) and the Marin Platinum Group (Top 100 agents in Marin County). These are elite agent networks with access to dozens of homes being marketed informally and not on the MLS. It is always my pleasure to be of service.

Kyle Frazier, J.D., Broker, Certified Residential Specialist (CRS), and Certified Luxury Home Marketing Specialist (CLHMS) with Christie’s International Real Estate | Pacific Union International Realtors.