December Marin Real Estate News

Bay Area Real Estate Sales.com Newsletter

December 2006

IN THIS ISSUE:

Marin Home Sales Statistics

Map Based Home Search Announced On Bay Area Real Estate Sales.Com

Bay Area Home Prices Decline, Sales At Five-Year Low

What Did Your Neighbors’ House Sell For?

Fed Holds Federal Funds Rate At 5.25 Percent

California Voters Concerned About State's Future

Best Mortgages In Today's Market

Most U.S. Housing Markets To Experience Sluggish Expansion In 2007

What Do Liz’s Clients Say?

Fast Facts

MARIN HOME SALES STATISTICS

These statistics show how many homes are available for sale in Marin, and of those how many are currently in contract (either pending or contingent. For the 3rd month in a row, the Marin overall real estate market is in a “Buyers Market.”

Although there are considerably less homes on the market this month as compared to last month, there are still more than the previous December (898 compared to 622 in December 2005), the percentage of homes in contract went up slightly (very slightly). My feeling is that many of the homes that did not sell have been pulled from the market, anticipating the slower months during the holiday season, or to possibly restart the Days on Market clock for that house trying to regenerate interest. As I predicted from last month, many homes have been pulled from the market during the typically slower Holiday months.

Homes priced from $500,000 to $999,999 are actually on the verge of being in a Balanced Market this month. The highest priced homes, (Over $4M are still in an Extreme Buyers Market, I interpret this to means that the “less expensive” homes (if there is such a thing in Marin) are finally selling at a faster clip, which is probably influenced by Feds stabilizing influence on the interest rates.

Like last month, Larkspur is still in a Strong Sellers Market, where 47% of all listed Larkspur homes are in contract. If you want to sell your Larkspur home, this is the time! Corte Madera and Greenbrae are in a Balanced Market; Belvedere, Fairfax, Kentfield, Mill Valley, Novato, san Anselmo, San Rafael and Tiburon are all in a “Buyers Market.” Ross and Sausalito are all in a “Strong Buyers” Market.

Days on Market (DOM): The Average DOM actually decreased this month– 78 days – A lot of this reflects that a lot of listed homes were pulled for the holidays. This means that it is taking an average of 2.5 months for houses to go into a PENDING status. A note of clarity: This does NOT mean when the house goes into contract (as it is still in a contingent state). The DOM clicker is stopped when all contingencies are removed, which is not entirely accurate at tracking how long it takes to get a house into contract. For example, a seller may have a house go into contract just 1 or 2 weeks after it is first listed, but with a long contingency period (say 45 days). This would mean that the DOM would show almost 2 months for that house to sell, whereas it was generally off the market after only a few weeks.

And for those of you who do read these stats, I’d love to know that you find the information useful! It actually takes me quite a lot of time to track, compile and post the data each month – and I’d love to know that it is being utilized! Send me an email to let me know you like getting it!

I’m always searching for ways to bring my clients and readers more local real estate statistics. I’m pleased to announce the launch of my new stats service: http://www.sfmarin.com/stats/lizmccarthy.php There are a lot of great stats here for your viewing pleasure. Once you click on the above link, be sure to mouse over the text near the top that says “Marin Statistics”. You can drill down the stats by year, month and by City. Enjoy. I’d love to hear your feed back if you like this new service!

If you know of anyone who would like to receive this monthly newsletter or is thinking of either buying or selling a home please let me know. I’d love your referrals!

MARIN HOME SALES STATISTICS - BY CITY AS OF 12/15/06
City	Total	Active	Number in Contract***	Percent in Contract*	Type of Market* (See Key)
Belvedere	22	17	5	23%	Buyers
Corte Madera	38	26	12	32%	Balanced
Fairfax	23	18	5	22%	Buyers
Greenbrae	24	16	8	33%	Balanced
Kentfield	20	14	6	30%	Buyers
Larkspur	17	9	8	47%	Strong Sellers
Mill Valley	89	65	24	27%	Buyers
Novato	238	179	59	25%	Buyers
Ross	15	12	3	20%	Strong Buyers
San Anselmo	48	36	12	25%	Buyers
San Rafael	208	152	56	27%	Buyers
Sausalito	47	41	6	13%	Strong Buyers
Tiburon	60	47	13	22%	Buyers
Others	49	37	12	24%	Buyers
Total Marin 12/15/06	898	669	229	25.5%	Buyers
Total Marin 11/16/06	1,197	902	295	24.64%	Buyers
Total Marin 10/15/06	1,401	1,095	306	21.84%	Buyers
Total Marin 9/15/06	1,395	1,127	268	19.21%	Strong Buyers
Total Marin 8/18/06	1,346	1,029	317	23.55%	Buyers
Total Marin 7/13/06	1392	1077	315	22.63%	Buyers
Total Marin 6/16/06	1323	959	364	27.51%	Buyers
Total Marin 5/18/06	1,177	817	360	31%	Balanced
Total Marin 4/10/06	977	629	348	36%	Sellers
Total Marin 3/15/06	894	597	297	33%	Balanced
Total Marin 2/20/06	782	520	262	34%	Balanced
Total Marin 1/8/06	611	449	162	19%	Strong Buyers
Total Marin 12/23/05	622	504	118	15%	Strong Buyers
Total Marin 11/27/05	961	655	306	32%	Balanced
Total Marin 10/14/05	1,086	730	356	33%	Balanced
Total Marin 9/11/105	1,012	651	361	36%	Sellers
Total Marin 7/15/05	1,030	616	414	40%	Sellers
Total Marin 5/25/05	940	503	437	46%	Strong Sellers

MARIN HOME SALES STATISTICS - BY PRICE RANGE AS OF 12/15/06
Price	Total	Active	Number in Contract***	Percent in Contract*	Type of Market* (See Key)
$100,000-$499,999	107	86	21	20%	Strong Buyers
$500,000-$749,999	231	162	69	30%	Buyers
$750,000-$999,999	195	136	59	30%	Buyers
$1,000,000-$1,499,999	148	111	37	25%	Buyers
$1,500,000-$1,999,999	74	60	14	19%	Strong Buyers
$2,000,000-$2,499,999	40	30	10	25%	Buyers
$2,500,000-$2,999,999	23	16	7	30%	Buyers
$3,000,000-$3,999,999	38	30	8	21%	Buyers
Over $4,000,000	42	38	4	10%	Extreme Buyers
Total Marin 12/15/06	898	669	229	26%	Buyers

DAYS ON MARKET (DOM)**
Date	Average	Median	Maximum
Nov	78	62	442

*Key to market type:
0% - 10% of Homes in Escrow: Extreme Buyers	36% - 45% of Homes in Escrow: Sellers
11% - 20% of Homes in Escrow: Strong Buyers	46% - 55% of Homes in Escrow: Strong Sellers
21% - 30% of Homes in Escrow: Buyers	56% - 100% of Homes in Escrow: Extreme Sellers
31% - 35% of Homes in Escrow: Balanced Market

**Based on information from Bay Area Real Estate Information Services, Inc. (BAREIS). Information has not been verified, is not guaranteed, and is subject to change and is based on one period of time.”

***Includes all: Sale Pending & Contingent properties

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

MAP BASED HOME SEARCH ANNOUNCED ON BAY AREA REAL ESTATE SALES.COM

We’ve added a new map based home search on BayAreaRealEstateSales.com This will allow you to search in any particular area via map, narrow down the specific homes that are available in that area. You can then view specific home sale details like pictures, square footage and price. I hope you like this new feature – be sure to give me any feedback!

http://www.realbird.com/MyRealBird.aspx?id=F3C3C1B5&p=ms&msc=BAREIS&scale=90&rb_f=0

BAY AREA HOME PRICES DECLINE, SALES AT FIVE-YEAR LOW

DQnews.com

La Jolla, CA.----Bay Area home prices dipped below year-ago levels in November for the second time in three months as sales held steady at a five-year low, a real estate information service reported.

The median price paid for a home in the nine-county Bay Area was $616,000 in November. That was 0.3 percent higher than $614,000 in October but down 1.4 percent from $625,000 in November last year, according to DataQuick Information Systems.

Last month's year-over-year decline was the steepest since prices fell 2.1 percent in February 2002. In September this year the median fell 0.8 percent from last year, marking the first annual decline since March 2002, when prices declined 1.3 percent. In October this year the median went positive slightly, up 0.5 percent from a year ago.

Last month's median was 4.3 percent below the $644,000 June peak. Much of the drop is seasonal: summer buyers pay around 3 percent more for their homes than those who purchase between November and February.

"Right now it looks like the Bay Area market is settling in on a price level that could last until spring. What happens after that depends on broader economic factors including interest rates, job growth and household incomes. As prices stabilize and sellers get real about asking prices, a lot of the fence-sitters will jump in. We could see a moderate increase in sales counts," said Marshall Prentice, DataQuick president.

A total of 7,204 new and resale houses and condos sold in the Bay Area last month. That was down 9.7 percent from 7,979 sales in October, and down 25.9 percent from 9,717 in November last year. A decline from October to November is normal for the season.

Last month's sales count was the lowest for any November since 2001, when 6,644 homes sold. Since 1988, November sales have ranged from 5,579 in 1994 to 10,897 in 2004. The average is 7,725.

DataQuick, a subsidiary of Vancouver-based MacDonald Dettwiler and Associates, monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.

The typical monthly mortgage payment that Bay Area buyers committed themselves to paying was $2,865 last month. That was down from $2,901 in October, and down from $2,921 for November a year ago. It peaked in June at $3,183. Adjusted for inflation, mortgage payments are 12.9 percent higher than they were at the peak of the prior cycle in early 1990.

Indicators of market distress are still at a moderate level. Financing with adjustable-rate mortgages is flat. Foreclosure activity is rising but is still within the normal range. Down payment sizes are stable, as are flipping rates and non-owner occupied buying activity, DataQuick reported.

All Homes	No Sold Nov-05	No Sold Nov-06	Pct. Chg	Median Nov-05	Median Nov-06	Pct. Chg
Alameda	2,009	1,441	-28.3%	$587K	$581K	-1.0%
Contra Costa	1,961	1,406	-28.3%	$589K	$562K	-4.6%
Marin	361	268	-25.8%	$809K	$841K	4.0%
Napa	183	125	-31.7%	$605K	$596K	-1.5%
San Francisco	594	441	-25.8%	$749K	$754K	0.7%
San Mateo	756	581	-23.1%	$733K	$726K	-1.0%
Santa Clara	2,394	1,846	-22.9%	$653K	$665K	1.8%
Solano	774	565	-27.0%	$490K	$446K	-9.0%
Sonoma	685	531	-22.5%	$574K	$530K	-7.7%
Bay Area	9,717	7,204	-25.9%	$625K	$616K	-1.4%

DataQuick Information Systems, www.DQNews.com

WHAT DID YOUR NEIGHBORS’ HOUSE SELL FOR?

The Neighborhood Homes Sold listing is a weekly reader feature of the Sunday San Francisco Chronicle and is provided by California REsource, a title abstracting company. The data posted here is typically months after the property officially sold. This is the public data available in the published tax records. The home addresses, sales price, number of bedrooms, square footage and the year the homes were built are based on information supplied from Bay Area counties' property transaction records which, in some cases, may not be complete.

Neither The Chronicle nor California REsource guarantees the completeness or accuracy of the information. Questions or requests for additional information should be directed to Cal Resource

Click on the following links to see what price homes sold for in your neighborhood:

November 26, 2006: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/11/26/REHS_marin.txt

December 3rd 2006: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/12/03/REHS_marin.txt

December 10th, 2006: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/12/10/REHS_marin.txt

Previous editions of Neighborhood Homes Sold

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

FED HOLDS FEDERAL FUNDS RATE AT 5.25 PERCENT

December 12, 2006 The Federal Reserve's Open Market Committee this week announced it would maintain the target for the federal funds rate at 5.25 percent. This is the fourth consecutive month the committee opted not to raise the target rate, which increased from 1 percent to 5.25 percent between June 2004 and July 2006. The federal funds target rate is the interest rate charged by banks when they borrow funds "overnight" from each other.

Citing the cooling housing market as a factor for the slower economic growth, the Fed also reported higher levels of inflation. "However, inflation pressures seem likely to moderate over time, reflecting reduced impetus from energy prices, contained inflation expectations, and the cumulative effects of monetary policy actions and other factors restraining aggregate demand," the Fed said in a prepared statement.

The Fed also indicated the possibility of future interest rate increases, acknowledging that "some inflation risks remain. The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information."

CALIFORNIA VOTERS CONCERNED ABOUT STATE'S FUTURE

Voters in the Golden State last month approved the largest bond package in state history because they are concerned about California's future, according to a recent post-election survey conducted by the Public Policy Institute of California. While 53 percent of those surveyed indicated they believe the state is headed in the right direction, up from 23 percent in 2005, voters are not completely satisfied. A majority of voters view the $37.3 billion infrastructure bonds package, which authorized spending for highway rehabilitation projects, state housing initiatives, flood protection, and levee repair, to be a "down payment rather than mission accomplished," according to PPIC Survey Director Mark Baldassare. Voters do not believe state funding for such projects is adequate, and 51 percent of voters believe California will be a worse place to live twenty years from now than it is today, according to the survey.

Despite Californians' concerns about the state's condition in coming years, voters also recognized the renewed relationship between Governor Schwarzenegger and the state legislature. Thirty percent of voters said November's election made them feel better about California politics, up from 21 percent in 2005. Additionally, 53 percent approve the way the governor and state legislature are working together.

Source: PPIC.org http://www.ppic.org/main/pressrelease.asp?i=659

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

MOST U.S. HOUSING MARKETS TO EXPERIENCE SLUGGISH EXPANSION IN 2007

A gradual increase in existing home sales is expected throughout 75 percent of the country in 2007, while the remaining areas will continue to see a slowdown during the first part of the year, according to NAR's year-end forecast. National existing home sales are anticipated to reach 6.40 million in 2007, down 1 percent from this year's expected 6.47 million. With rising construction costs and lower levels of builder activity, the Association projects a larger decline in new home sales, which are forecasted to fall 9.4 percent to 957,000 next year. Median home prices for both existing and new homes are expected to register slight increases in the coming year, forecasted at $224,700 and $241,700, respectively.

"Buyers, especially first-time buyers, with the combined benefits of seller flexibility and an unexpected drop in mortgage interest rates, have a window of opportunity," said NAR Chief Economist David Lereah. "These conditions will persist in many areas until early spring when inventory supplies are likely to become more balanced."

Source: Realtor.org

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

BEST MORTGAGES IN TODAY'S MARKET

By: Jack Guttentag

"Are some types of mortgages priced better for the borrower than others?"

If you qualify for prime lending terms, there isn't much reason to select an adjustable-rate mortgage (ARM) in the current market. For most such borrowers, the temporary rate benefit in the early years is too small to justify the risk of higher rates later on.

This is a consequence of what has been referred to as a "flattening of the (bond) yield curve." The yield curve is a graph that shows, at any given time, how the yield varies with the period to maturity. A flat yield curve means that yields on long-term bonds are not much higher than those on short-term notes.

Bond markets affect mortgage markets, and vice versa, because a large part of all new mortgages are converted into mortgage-backed securities (MBSs), which investors view as close substitutes for government securities and high-quality corporate bonds. Developments in the MBS market, in turn, are immediately reflected in the primary mortgage market where individual borrowers obtain their loans.

When the bond yield curve flattens, the mortgage yield curve facing borrowers flattens as well. This means a marked reduction in the rate differences between fixed-rate mortgages (FRMs) and ARMs. It also means smaller rate differences between FRMs with different terms.

I did my own online rate survey on Oct. 8. It covered what loan originators call a "cream-puff" loan -- one with no complications. It was a no-cash refinance for $320,000 on a single-family property used as permanent residence and valued at $400,000, to a borrower with good credit who can fully document an adequate income. I used the 30-year fixed-rate mortgage as the base, and measured rate differences with other mortgage types when points and other loan fees were the same.

The most interesting result was that the rate on the 30-year FRM was only .25 percent higher than that on a 3/1 ARM -- for example, 6 percent compared with 5.75 percent. The lower rate on this ARM holds for three years, after which it is adjusted on an annual schedule.

More likely than not, the rate on this ARM will increase at the first adjustment. The new rate will be the value of the rate index at that time plus a margin, which remains the same over the life of the loan. We don't know what the index will be in three years, but we know that right now it is about 5.25 percent, and a competitive margin is about 2.25 percent. This means that if the market doesn't change over the next three years, the new rate on the ARM will be about 7.5 percent. A .25 percent rate difference for three years hardly seems like adequate compensation for the additional risk.

Since the 3/1 ARM is not a good choice, the same conclusion holds for 5/1, 7/1 and 10/1 ARMs on which the initial rates hold for five, seven and 10 years, respectively. The rate advantage over the 30-year FRM, if any, is smaller than .25 percent.

Among FRMs with different terms, rate differences are much smaller than in years past. The 15-year and 10-year FRMs are priced only about .3 percent and .4 percent, respectively, below the rate on a 30-year. The shorter term FRMs remain the better deal, but the reward for borrowers who can afford the higher payments is smaller than it used to be.

The 40-year FRM, in contrast, is priced at about .4 percent above the 30 and is a poor deal. Borrowers who need a payment below the one on a standard 30-year would do better with the interest-only version of the 30. It is priced only about .1 percent above the standard 30 and carries a lower payment than the 40.

These observations don't apply to subprime borrowers, most of whom will continue to obtain ARMs because they will be offered nothing else. The most common subprime ARM is the 2/1 (the initial rate holds for two years), which will typically have margins of 5 percent or more and carry a penalty for early prepayment.

Another category of borrowers unaffected by recent market changes are those fixated on getting the lowest initial payments available in the market. They will continue to select option ARMs on which the payments don't cover the interest in the early years. Option ARMs carry margins 1 percent to 1.5 percent above those on other ARMs because lenders view the default risk as higher.

Of course, what to the lender is a high risk of default and loss, to the borrower is a high risk of losing the house. Most borrowers who take option ARMs make the minimum payment, which leads inevitably to payment increases down the road that may be too large for the borrower to handle.

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

WHAT DO LIZ’S CLIENTS SAY?

“In essence I had a thoroughly enjoyable, professional and gratifying experience with a person who eventually became a friend. You were clearly interested in my personal life as it applied to the type of home I would be happy in. Even after seeing the house I ultimately bought, you were patient enough to show me additional homes so that I would be comfortable with my decision.

However, it was after we selected the house that I truly benefited from your business skills. The negotiation process, the drafting of the contract, related correspondence and handling the all the details was accomplished with thorough competence and professionalism. The entire experience was thoroughly enjoyable. I truly appreciate how difficult buying a home can be. Yet you handled each obstacle thrown our way by the sellers’ agent, the sellers and the bank with calm assurance and you resolved each issue to my complete satisfaction.

I will be happy to recommend you to all my friends and colleagues who may be buying a house in the future. “

-F Konigsberg

If you would like to have Liz help you sell your Marin home or help you in finding a home, or you know of someone that could benefit from her services, just send her an email:

liz@BayAreaRealEstateSales.com

“High-Touch through High-Tech”: Did you know that Liz McCarthy is ePro Internet Certified by the National Association of Realtors and that 70 percent of home buyers today use the internet in their home search? Why are you still working with a Realtor who isn’t a technology expert?

What this means to you:

Home Buyers: Liz is an expert in helping save you time by using the internet, email and other technology resources to help save your valuable time and money. She knows how busy you are!

Home Sellers: Liz will hire a professional photographer and market your home extensively on the internet: a personal property website (see http://www.417greenfield.com/ or http://www.50milland.com/ for samples), she will post your home on over 50 websites.

FAST FACTS

Marin median price – Nov, 06: $841,000 (Oct, 06: $844,000) [Source: DQNews.com]

Calif. median home price – October 06 $548,680 (September 06: $553,550) [Source: C.A.R.]

Calif. highest median home price Oct 06: Santa Barbara So. Coast $1,115,000 (Aug: $1,025,000) [Source: C.A.R.]

Calif. lowest median home price by C.A.R. region Sep 06: High Desert $328,650 (Oct 06 $329,040) [Source: C.A.R.]

Calif. First-time Buyer Affordability Index - Third Quarter 06: 24 percent [Source: C.A.R.]

Mortgage rates - week ending 12/14/06: (Source: Freddie Mac)

• 30-yr. fixed: 6.12%; Fees/points: 0.4%
• 15-yr. fixed: 5.86%; Fees/points: 0.5%
• 1-yr. adjustable: 5.43%; Fees/points: 0.7%

FREE…..You can search for Marin listings directly on BayAreaRealEstateSales.com: Search for Homes

Be sure to check out all the other great content & features of my website:

http://www.bayarearealestatesales.com/

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The Bay Area Real Estate Newsletter is provided to you by:

Liz McCarthy

Real Estate Broker, e-PRO certified

Liz@BayAreaRealEstateSales.com

415-250-4929

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