Next Economic Stimulus Program: $50-$200 Rebates for Purchasing a High-Efficiency Appliance

By Alicia Lanier, REALTOR

Needing a little financial help to finally replace that old refrigerator that seems to always be running noisily – and, more importantly, running up your electricity bill? Coming in late fall is the home appliance sequel to the auto industry’s “cash for clunkers” program.

Part of the broader economic stimulus program passed by Congress earlier in the year, this new program authorizes rebates of $50 to $200 for purchases of high-efficiency household appliances.

“These rebates will help families make the transition to more efficient appliances, making purchases that will directly stimulate the economy,” Energy Secretary Steven Chu said in a statement announcing the plan. Only appliances covered by the Energy Star seal will qualify. In 2008, about 55% of newly produced major household appliances met those standards, which are set by the Energy Dept. and Environmental Protection Agency.

Program details will vary by state, and the Energy Dept. has set a deadline of Oct. 15 for states to file formal applications. The Energy Dept. expects the bulk of the $300 million to be awarded by the end of November. Unlike the clunkers auto program, consumers won’t have to trade in their old appliances.

TIP: Another economic stimulus program – the maximum $8,000 tax credit for first time homebuyers - will expire the end of November, 2009.  If you are a first-time homebuyer or haven’t owned a home in three years, call me for details about how this program can benefit you: 408-491-1634. 

Marketwatch: SF Bay Housing “Micro Markets”

By Alicia Lanier, REALTOR

Following is an excerpt from the weekly Marketwatch by Rick Turley, president of the San Francisco Bay Area region of Coldwell Banker Residential. He provides a handy recap of all the activity in various local markets that we serve, including our Silicon Valley. Note that REOs (bank-owned foreclosures) are still hot in many communities!

” … let’s take a look at our local week in real estate:

“East Bay—Berkeley reports, “We are busy, busy, busy.” Lots of buyers making lots of offers and multiple offers abound. We received anywhere from 4-17 offers on various listings and competed against 2-15 offers on others from Berkeley to Richmond to El Sobrante to San Pablo. Danville reports we saw a real jump in new pending sales this past week. More importantly, Blackhawk, which has been so quiet for so long, had nine new pending sales. And in our office, four new sales this past week were over $1 million dollars! Oakland reports a sudden sense of urgency among buyers. We are doing a lot of approvals and submitting applications. The buyers are out there looking. Properties in foreclosures are coming into better neighborhoods, same for short sales. Still it is August and sales have been a little slow the first week. Seeing some nice listings come on the market.

“Monterey County—August started out where July left off, with lots of Agent activity going on! Pebble Beach and Carmel are bustling with people as the annual Concours d’Elegance comes to town , bringing it with it lots of people–some deciding they’d like a vacation home here! Inventory is decreasing, partly due to sales going up and partly due to properties off market, being rented, etc. Carmel is down to only about 14 months supply (was about 28 months), Pebble Beach is about the same, and Seaside, which has been the REO hot spot, has only 1.3 months’ supply!

“North Bay—Greenbrae reports despite the late summertime, open houses were still well attended and buyers are out looking for bargains. Many sellers are saying they want to wait until after Labor day to put their home on the market. Buyers want more choices. San Rafael reports REO inventory is increasing. We continue to see multiple offers in the entry level. One home listed in Novato had 16 offers in the first week. It went into contract $50,000 over asking. All cash offers seem to be the winners of most of the bidding wars. Petaluma reports multiple offers continue to be the norm in the under $300,000 range. We’re starting to see activity in the $500k-700k range with multiple offers on three properties in that price range. Cash continues to be king in the under $300,000 range. One property had 22 offers, the accepted offer was cash and was less than three of the highest offers.

“Peninsula—Burlingame reports the wonderful weekend brought people out of the fog and into the peninsula. We are seeing more multiple offers as inventory is shrinking. The condo market is extremely slow. Menlo Park Santa Cruz Avenue reported one offer was written and accepted from an open house guest! They do work! Activity in a wide range of prices. Buyers that seem motivated to buy. San Mateo reported these market wide stats: Change 2009 VS 2008 same period – active – Belmont N.C., Burlingame +23%, Foster City -15%, Hillsborough +41%, Redwood Shores +15%, San Mateo + 12%, PENDING – Belmont +23%, Burlingame +16%, Foster City +24%, Hillsborough +33%, Redwood Shores -125%, San Mateo +29%. This reflects single family residential only. Higher ends are still a struggle as reflected in Burlingame and Hillsborough.

“San Francisco—Lombard reports a good week for ratified offers in that it wasn’t entry – price level dominant. We had sales in the $1.2 & $3m ranges. Multiple counters, addendums and loan delays are the order of the day. The Market Street office reported it has slowed a bit as many buyers are taking a couple of weeks off before the end of summer. Listings are being readied for the after Labor Day increase of inventory that we are anticipating. Open house attendance was great in some instances and disappointing in others.

“Santa Cruz County—No major changes. Inventory is status quo – low end continues to dominate sales. There is a lot of activity below $800K and many times multiple offers. With the low inventory we are seeing prices rising again, slowly. There is definitely a more positive outlook for both buyers and sellers.

“Silicon Valley—Cupertino notes that the low-end is as competitive as ever. San Jose Almaden reports that we’re seeing multiple offers on almost everything under $500K. Inventory remains low. San Jose Main reports an excellent week for sales, mostly lower end and excellent open house activity. Listings continue to be hard to get. Many multiple offers on lower end properties. Saratoga reports we experienced a slight increase in Previews activity with a few sales in the $2.5 mil to 3 mil range last week.

“South Santa Clara County—Gilroy reports our local market continues to struggle with a lack of inventory in the lower end. REO listings are down and multiple offers are the norm. Hollister reports lower priced homes selling rapidly with multiple offers on many. Morgan Hill reports the real estate industry seems to be getting positive signals, almost on a daily basis, that the housing market is out of “intensive care” and has entered the “recovery room.” Demand remains high, but more importantly, our Agents are reporting that the buying public deems to be much more optimistic about the economy in general and housing in particular.

“In terms of marketing activity, in general, and with exception of the entry level, most homes are on the market longer with discerning buyers waiting for the optimal home at the optimal price. A well-priced, well-presented home can still fetch multiple offers, but it’s got to look appealing to the savvy buyers who are doing their homework. There is no sense in overpricing a listing – a buyer won’t even give a home the time of day if they sense the seller is being unrealistic.

“At the same time, there seems to be no better time to snatch up bargains in the Bay Area at all price points. In the higher end, we’ve seen cases of five to 10 percent list price reductions in properties that haven’t moved, and a final and acceptable offer coming in a little below that. That’s not to say buyers should throw out ridiculous numbers. Certain parts of the Bay Area, after all, have still held their value better than most of the entire country. Sellers who don’t have to sell can hold firm, but there are others who cannot. So, while it may take longer to get the buyer and seller to agree to terms, transactions are happening, and with open minds on both sides, we are beginning to see more positive movement for all. “

TIP: Are you planning to buy or sell in any of the above local markets? Email me at Alicia.Lanier@cbnorcal.com and I would be delighted to help you – or put you in touch with one of my great, highly professional Coldwell Banker colleagues who is an expert in one of these ”micro markets”.

Marketwatch from Coldwell Banker’s President in Northern California

By Alicia Lanier, REALTOR

Our president of the Coldwell Banker Northern California region, Rick Turley, issues a weekly Market Watch to CB agents and this week was full of positive (read: “less bad”) news about the real estate industry. Here are excerpts from his July 31, 2009, report:

“It seemed everywhere you looked this week, the media was reporting on some sort of positive indicator relating to the real estate market. For starters, Good Morning America ran a story on Tuesday about the state of the housing market. Liz Ann Sanders, the Chief Investment Strategist for Charles Schwab, and Mike Santoli, Assoc Editor of Barron’s were interviewed. Essentially they both indicated there are enough cumulative signs from indicators to say that things are not only “less bad”, but we are starting to see some pockets of improvement in the housing market. Among the vital signs they said to watch for in calling a recovery are; Index of Leading Economic Indicators, currently up three months in a row; drop in new unemployment claims (the four week average is down 93,000 from the peak, and never before has there been this large of a drop while still being in a recession); and the spread between short term (set by Fed) and long term (driven by the market) interest rates, which is widening. Additionally an opinion was shared that if the Dow stays above 8,000 – this would be a good indicator that we’re on the road to recovery. This week we danced over the 9,000 mark, closing today at 9,171; making it the best July for the Dow in over 20 years.

“Our industry was the first to be hit by the economic downturn and if all continues on this path, we will be the first out. We probably won’t see housing numbers start to appreciate across the board anytime soon. What we are seeing right now are signs we typically see at the bottoming-out of a down market. Speculators and investors are competing with first time home buyers. Those individuals are going to continue to gobble up the inventory—both REOs and non-bank sellers at the entry price level. In many metros across the country, there are very low levels of inventory at the low end. I was on the phone this afternoon with the Coldwell Banker president for Arizona. They were hit hard, and early, with foreclosures. He told me that today the Phoenix Metro area has under 2 months supply at their entry level, <$250k – yet a 7 years supply of inventory at their estate home level of $2M+.

“Also this week the Standard & Poor’s/Case-Schiller 20-city index was released and in it, home prices in May posted their first monthly increase since the summer of 2006. Prices rose from April in 13 of the metro areas tracked, notably Cleveland, Dallas, Boston and the Bay Area. The news followed reports showing sales of newly built and existing homes rising in June for the third consecutive month. New home construction, though still weak, is the best it’s been since the fall.”

As Rick signals, apparently many real estate experts are now trumpeting the end of “the worst housing recession anyone but survivors of the Great Depression can remember.” An Associated Press article today, entitled Welcome to the bottom: Housing begins slow rebound, proclaims that “the worst is over.”  Before we start singing Hallelujah! let’s get past the last half of 2009.

Whether you are considering buying or selling a home or investment property, call me at 408-491-1634 or e-mail me at alicia.lanier@cbnorcal.com with any real estate questions, to obtain photos and details about homes for sale, or to learn the potential selling value for your home