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Silicon Valley Real Estate News - April, 2013
VALLEY REAL ESTATE SNAPSHOT:
March 2013 sales of multiple-listed residential real estate in Santa Clara County totaled $1,003,065,219 vs. $673,346,300 for February 2013 and $974,186,282 for March 2012. The average price of single-family homes closed in March was $943,614, up 4.2 percent from $905,416 in December 2012. The median price of $730,000 was up 7.2 percent from $681,000 in December 2012. The average price of condo/townhomes closed in March was $500,149, up 11.2 percent from $449,910 in December 2012. The median price of $440,000 in March was up 11.4 percent from $395,000 in December 2012. The average sale in March was 105.2 percent of list price. Listed inventory totals 3,480 units vs. 2,900 last month.
2012 SAW BIG JOB GAINS FOR BAY AREA:
The 9-county Bay Area added 91,400 jobs in year 2012 according to the California Employment Development Department. That represents the largest annual gain since year 200 during the dot com boom when 129,000 jobs were created. The San Francisco-San Mateo-Marin region ranked first in job creation with the South Bay in second place and the East Bay coming third. The total number of Bay Area jobs on record at year end stood at 3,239,300. Bay Area jobless rates decreased slightly to 6.5 percent in the San Francisco region, 7.9 percent in the South Bay and 8.6 percent in the East Bay. California as a whole added a net 225,900 jobs in 2012 resulting in a reduced 9.8 percent unemployment rate. Bay Area job gains represented 40 percent of California's total.
GOVERNMENT EXTENDS HOME BUYER TAX CREDIT DEADLINE:
President Obama recently signed into law a bill extending the closing date for transactions eligible for the homebuyer federal tax credit from June 30, 2010 to September 30, 2010. Buyers must have already entered into a contract to purchase their home by May 1, 2010 to qualify for this extension. Without this extension it is estimated that approximately 180,000 homebuyers across the U. S. and 17,700 hombuyers in California would have missed out on the tax credit.
HOME AFFORDABLE FORECLOSURE ALTERNATIVES PROGRAM:
The U.S. Treasury has released guidelines and forms for its new Home Affordable Foreclosure Alternatives Program (HAFA), which provides incentives for short sales or deed-in-lieu of foreclosures on loans eligible for modification under the Home Affordable Modification Program (HAMP). HAFA compliments HAMP by providing a viable alternative for mortgage holders who are HAMP eligible but are still not able to keep their homes. Among the various provisions of HAMP are that it: 1) allows borrowers to receive pre-approval of short sale terms before listing the property on the market, 2) uses borrower financial and hardship information already gathered for a loan modification, 3) prohibits a reduction in agreed upon real estate commissions, 4) requires full release of borrowers from future financial liability and 5) provides cash financial incentives for borrowers and servicers to smooth the transaction.
IMPROVING CONSUMER CREDIT SCORES:
Fair Isaac Corporation has developed the “FICO” credit scoring system used by many mortgage lenders to rate a borrower’s ability to make their loan payments on time. A borrower’s score is made up from: 1) payment history (35 percent), 2) revolving debt ratio (30 percent), 3) length of credit history (15 percent), 4) new credit and credit inquiries (10 percent) and 5) type of credit used (10 percent). The following guidelines are given for improving one’s credit score: 1) Most importantly, pay bills on time. 2) Lower the total debt load. Avoid maxing out credit cards. 3) Keep old accounts open and in good standing. Keep balances well down from credit limits. 4) Open new accounts sparingly. Don’t open accounts that aren’t intended to be used.
EFFECT OF MORTGAGE PROBLEMS ON CREDIT SCORES:
The way that homeowners react to mortgage problems can greatly affect the impact of those problems on their credit scores. Loan modifications that fold late payments and penalties into the principal amount actually can improve a borrower’s scores slightly. Short sales have the opposite effect with credit score declines of 120-130 points often being the result of a short sale. Stopping payments entirely and walking away from the home can result in a loss of 150 points and a negative impact on the person’s credit file for 7 years. Filing for bankruptcy covering all debts may result in a loss of over 350 points off a credit score and can remain on the credit file for 10 years.
RECENT AREA SALES:
CURRENTLY FOR SALE:
BEAUTIFUL RANCHER - CUPERTINO AREA:
Spacious 3 BR, 2 BA with remodeled kitchen and baths complete with new floors, new kitchen cabinets and countertops, dual-pane windows and new paint. Lovely, quiet neighborhood. Desirable Cupertino schools.- $799,000.
GORGEOUS REMODEL - CAMPBELL:
Beautiful 3 BR, 2 BA ranch style home with extensive remodeling. Features include dual-pane windows, wood-burning fireplace, central A/C and 2-car attached garage. Large lot with attractive landscaping. Price reduced to sell now. - $729,000.
TERRIFIC DUPLEX VALUE - SUNNYVALE:
Attractive 2-unit building located in desirable Sunnyvale area. Both living units are 2 BR, 1 BA with spacious rooms, private patios and separate garages. Building is well-maintained and rents easily. Property is a super investment value at current price. - $599,900.
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