Of course, you would expect me to say this, right? OK, I admit I’m optimistic by nature and I know that Realtors can sometimes get excited. However, before you discount my outlook as sales hype, I think I’ve got good reasons to be looking forward to 2012 and telling you about it!
It’s no secret that as the economy goes, so does the real estate industry. On that note, 2012 was welcomed by some great economic news. The employment level is trending upward and the number of new jobs created in the last quarter is the highest in 3 years, Wow! Even more relevant news is that the employment picture is better in Silicon Valley right where we live and work!
This data is significant on a number of levels for real estate. First, the main influences in driving real estate decisions is the job market. People don’t buy until they’re employed and emotionally secure about their income. Likewise, banks more likely provide loans to borrowers with stable incomes.
Since I’m on the subject of loans, the Fed is working on lawmakers to loosen lending rules in 2012. While low interest rates have encouraged home purchases, qualification standards have been the main hurdle in getting buyers into new homes. If lending qualifications ease to more realistic and attainable levels, purchase activity can really take off.
So, as you can see there are plenty of reasons to be optimistic for 2012. While you’ll never hear me make guarantees about future events, I will say I’m excited about what’s ahead for real estate and our broader economy.

Deadbolt lock for extra security

Make your home look occupied and ensure it is secure throughout:

1. Leave lights on when you go out.
2. Install deadbolt locks on all outside doors (no push button locks).
3. Lock all outside doors and windows before you leave the house, even for a short time.  This includes the garage and side door to the garage. Sliding glass doors or side bathroom windows are vulnerable.  Be sure you have secondary locks or alarms on these areas.
4. Lock any side gates at all times.
5. Make sure your exterior doors are study, solid wood or steel.
6. Consider leaving a car in the driveway or some other obvious sign that you are home.
7. Use curtains on garage windows so it is not obvious if cars are gone or tempting with personal property viewable inside.
8. Get a dog or make it look like you have one at the very least.
9. Don’t temp a theft – store lawn mowers, bikes and BBQs out of sight.
10. Have adequate outside lighting.  A motion-sensitive light is recommended for backyards.
11. Trim trees and shrubs so they cannot be used as hiding places for intruders.
12. Consider installing a home alarm.  If you have one, USE it!  Many people don’t and burglars know this so they are not deterred by alarm company signs/stickers.

Going on Vacation?

Make sure you utilize the tips above plus consider these below.

1. Connect lamps to auto timers so lights are on during the evening/night.
2. Do not allow packages or mail to build up on your doorstep…request your mail be stopped and/or ask a neighborhood to clear these for you.
3. Arrange for your lawn to be mowed if you are to be away for an extended time.
4. Check before you leave that all windows and doors are locked.

Information from http://www.sjpd.org/BFO/Community/Crimeprev/PreventionTips/Prevent_Burglary.html 

A surge in wealth from technology stock sales and initial public offerings is spilling into the Silicon Valley real estate market as newly rich workers bid up home values in suburban cities south of San Francisco.
The median price of single-family houses sold in Palo Alto, home of Facebook Inc., climbed 20 percent in May from a year earlier to $1.63 million, the biggest jump since 2008, according to preliminary figures from research company DataQuick. In Mountain View, the base of LinkedIn Corp., prices rose 3.1 percent to $957,500, the ninth year-over-year gain in 12 months.
The advances are defying a U.S. housing slump that has sent national values to an eight-year low. Share sales such as the IPO of LinkedIn — which doubled on its first day of trading — and an expected offering from Facebook will fuel a boom in some Silicon Valley cities into 2013, said Kenneth Rosen, an economist at the University of California, Berkeley.
“It’s just the beginning of the story and I suspect we’ll see an explosion in the next couple years,” Rosen, chairman of the school’s Fisher Center for Real Estate and Urban Economics, said in a telephone interview. “You’ve got young people with real money, and it’s not surprising they want to have a house.”

IPO Filings

Almost 300 companies have filed for IPOs in 2011, the most for any year during the same period since 2000, and more than 10 percent of those are in California, according to data compiled by Bloomberg. Silicon Valley is the U.S. hub for early-stage companies, receiving almost 40 percent of the $23.3 billion in venture-firm investments last year, estimates from the National Venture Capital Association show.
Pandora Media Inc. climbed 8.9 percent today as shares began trading on the New York Stock Exchange. The online radio company, based about 35 miles (56 kilometers) north of Silicon Valley in Oakland, raised $234.9 million in its IPO. Shares were priced at $16, above the expected $10 to $12 range.
The real estate gains in Silicon Valley, located primarily in the San Jose metropolitan area, are mostly occurring in towns where million-dollar values are already the norm. The median price in Cupertino gained 12 percent last month from May 2010 to $1.08 million, and values in Saratoga rose 4.7 percent to $1.62 million, according to San Diego-based DataQuick.

U.S. Price Declines
Housing in much of the rest of the nation is struggling as foreclosures and unemployment of more than 9 percent weigh on consumer sentiment. Home prices in 20 U.S. cities dropped 3.6 percent in March from a year earlier to the lowest since 2003, according to the S&P/Case-Shiller index of property values. The measure has declined 33 percent from its 2006 peak.
In Palo Alto, traffic at home showings has tripled in the last three weeks, with the average age of potential buyers dropping from about 50 to the mid-30s, said Daniel Siciliano, an associate dean at Stanford Law School who attends the tours because he’s in the market for a bigger house.

“People at startups have a lot of pent-up demand and tend to spend a portion of their new liquidity pretty quickly,” Siciliano said of his newfound competition for residential real estate. “They want to manifest their wealth.”

Past Silicon Valley property booms started in Palo Alto, adjacent to the Stanford campus, and Cupertino, home of Apple Inc., because of those institutional links and their coveted public schools, said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto. Buyers from China have also been drawn by education resources in prestige valley locations and pushed up demand.

‘Happening Place’
“We’re a happening place because of the university and a lot of the folks that have been buying are relatively young,” said Levy, who has viewed downtown condominiums selling for double what he paid in 2005. “We have the best train service to San Francisco. I can be downtown in 35 minutes.”

Sean Scott, head of sales for Redwood City-based software firm Ingenuity Systems Inc., looked at a four-bedroom, two-bath home in Palo Alto last month priced at $1.8 million. The house has “soaring ceilings and generous living spaces,” two patios and a “lush backyard garden,” according to a marketing flyer.

A sale is pending for more than 20 percent above the asking price, or at least $2.2 million, after five bids were received, said Denise Simons, the listing agent at Alain Pinel Realtors.

“The market seems to be returning to the crazy days and the question is whether or not it is a false recovery or a sustained recovery,” Scott said in an e-mail after viewing two more homes at $1.25 million or more, and declining to make any offers. “I suspect that it is a sustained recovery, given the planned liquidity events with social-networking companies.”

Facebook IPO
Speculation that Facebook will go public in the next year is mounting even as the world’s largest social-media site remains silent about its plans. The company may have an IPO in the first quarter of 2012 with a valuation as high as $100 billion, cable channel CNBC reported June 13, citing people familiar with the matter.
Some investors have already cashed in equity in their companies through private share sales, boosting Silicon Valley housing demand and contributing to price gains, Rosen said. Stakes in closely held firms can be sold on secondary exchanges such as SharesPost Inc., which connects buyers and sellers. The exchange values Facebook at almost $53 billion.
Shares granted to employees of public companies can’t be sold until 180 days after the IPO, under U.S. securities rules.
New Millionaires
“You will probably see hundreds, if not thousands, of newly minted millionaires in the next two or three years,” said Steve Eskenazi, a tech investor in Hillsborough, north of Palo Alto, where the minimum lot size is a half acre (0.2 hectare). He sold his portion of an online advertising network to Sunnyvale-based Yahoo! Inc. in 2007.
“Most people in their 20s who find themselves millionaires feel it’s their inalienable right to buy real estate, and they’re typically not price sensitive,” Eskenazi said.
Facebook founder Mark Zuckerberg, 27, bought a house this year in Palo Alto, said Larry Yu, a company spokesman. He declined to disclose details. Zuckerberg paid $7 million for a 5,000-square-foot (465-square-meter), seven-bedroom home in a “leafy and affluent” neighborhood, the San Jose Mercury News reported May 5, without saying where it got the information.
The purchase was made before Facebook’s scheduled move to Menlo Park, just north of Palo Alto.

15 Miles
As more firms go public and workers cash in shares, real estate within 15 miles of the office will climb, said Rosen, who gave a presentation at Google Inc.’s Mountain View headquarters before the company’s 2004 IPO to educate employees on housing. Sales are usually concentrated in the “middle to upper end,” he said.
In Cupertino, about 12 miles from Palo Alto, a three- bedroom home listed for $908,000 got more than a dozen offers and sold for $950,000 on June 8, said Albert Kao, an agent at Giant Realty Inc. in the city. The prior owner, who bought the property in 2002, decided to sell after her children graduated from the public schools. She made a $290,000 profit before commissions, Kao said.
Lower-priced areas are still struggling with weak demand. In all of Santa Clara County, which encompasses some Silicon Valley cities, prices decreased 5.1 percent in May from a year earlier to $498,000 as distressed sales pulled values down in the broader market, DataQuick said in a report today. The drop was smaller than in the rest of the San Francisco Bay area, with the nine-county median in the region tumbling 9.3 percent.
Groupon, Zynga
Groupon Inc., an online coupon provider based in Chicago, filed for an initial share sale June 2 and is hiring engineers in California, according to its website. As early as March, Groupon was in talks with bankers about an IPO that would value the company at as much as $25 billion, two people familiar with the matter said at the time.
Zynga Inc. of San Francisco, the largest maker of games for Facebook and valued at $8.8 billion on SharesPost, may file for an IPO by the end of the month, a person with knowledge of the matter said June 3.
Those firms are among the companies that will help Silicon Valley grow by about 20,000 workers in 2011, said Levy, the California economist. Software publishers and Web portals accounted for 5,600 of the 13,400 jobs added in the year through April in the San Jose metropolitan area, according to the California Employment Development Department.
“We’re at the beginnings of an expansion of the job base,” said Levy. “There will be a lot of hiring.”
Simons, the agent for the four-bedroom Palo Alto home, said there were five “excellent” offers for the 2,257-square-foot residence. It was constructed in 1973 by California developer Joseph Eichler, who built thousands of “progressive” tract houses in middle-class neighborhoods, according to a website devoted to the properties.
“There are people who want to get in and they’re willing to pay,” Simons said outside the home, which was repainted, landscaped and staged with furniture before the public showings. “We’re just starting to see the market come back.”
To contact the reporter on this story: Dan Levy in San Francisco at dlevy13@bloomberg.net
To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net
Last Updated: June 15, 2011 18:52 EDT

Home for Sale on Meander Drive San Jose Ca Almaden Valley

Did you know that Almaden Valley real estate typically peaks in April or May?  So now is the time to sell in San Jose area since the buyers are out there and inventory is not yet too high.

Let’s review the Almaden Valley real estate market update below for specifics.

First let’s take one specific example.  This home to the left is at 5835 Meander Drive in Almaden Valley of San Jose CA.  I personally listed this home for $848,000 the week before Easter, April 19th.  We had a very busy open house Saturday April 23rd with 28 groups of people through the home!  That is fantastic traffic…buyers are out there!  We now have this home under contract for sale and it took just 10 days to negotiate and lock in the contract!  Hot market for sellers!!!

Almaden Valley Statistics- Days of Inventory by Month

Let’s look now at the Almaden Valley market statistics for a general view.

On May 1st there were 97 homes for sale.  In April, 36 homes in Almaden Valley sold.  Wow, that’s only 3 months of inventory right now…definitely leaning toward if not truly, a seller’s market.  As you can see on the right, the trend is that inventory is going down as buyers purchase more and more of the available homes.  This chart shows data through March.  April is not yet added, so it’ll be interesting to see how this past month looks compared to what is shown here now.

As the Days of Inventory decrease, the more we head into a desirable time for sellers to put their home on the market in Almaden Valley. Who wouldn’t want their home to sell faster?

The below chart of sold and active homes through March 2011 show we are heading into a seller’s market (indicated by the “sold” homes line being over 0.1).  See chart below where the lighter gray line is heading up indicating home sales are on the rise.So if you are thinking about selling your home in Almaden Valley, contact Theresa now for a personal plan to get your home ready and on the market.  Don’t wait as inventory always increases in the summer and then you’ll have more competition.

Charts provided by http://www.rereport.com

Solar panels installed on a home

Many home owners in San Jose CA and around Silicon Valley are adopting solar panels for alternative energy or buying Electric or hybrid cars.  Does that make you an Environmentalist or a pocketbook environmentalist?

Well, depends on your decision process and intentions I suppose.

If buying “green” is the same price as traditional products?  Which would you choose?  Or how about if the “green” option saved you money?

If you are like me, I support green products whenever possible, but I won’t spend tons of extra money just to be green.  So I think that makes me a Pocketbook Environmentalist.

Wish we saw more of these signs around

For example, I would love to have a hybrid or even electric car, BUT buying a used SUV saves me money in my upfront purchase.  The money I saved making a used purchase, then can be applied over time to the extra money spent in gas.  Definitely not a green or environmentalist decision.  But it was a financial one.

I have though purchased energy star rated appliances and do use the minimum water to upkeep my home’s landscaping.  Those both benefit my pocketbook and the environment…thus, I conclude I am a pocketbook environmentalist!

My husband and I are currently considering adding solar panels to our home.  The decision process I find us going through is definitely financial.  But hey I need to be a good steward of my money and take care of my own home and children as well as the environment whenever possible.

I do support saving trees and keeping San Jose CA and Almaden Valley green with parks as many places as possible which is why I am a member of the Martin Fontana Parks Association.

So will we make the change to go solar and make our home hybrid-powered like many residents of  Almaden Valley of San Jose CA have already?  Not sure yet.  Will have to keep you posted.

Check out this article on the Rise of the Pocketbook Environmentalist.

This past February, PG&E planned to remove 16 trees, but with the diligent work of MFPA, 9 of those trees were saved!  MFPA has been working hard to maintain the parks as they are.  Great work MFPA and friends for saving many, many trees so far and keeping the parks maintained and pretty for the community to enjoy!

Here is more info on the removal of the 7 trees that were taken from the park late February 2011.

Join MFPA and help keep TJ Martin and Jeffrey Fontana Parks preserved!

Spring is near and though the snow banks still comprise the landscape of much of the country, it’s only a matter of time before the big thaw. Spring traditionally is one of the busiest times in housing markets. While it’s too early to tell how this season will impact sales volume and prices, this spring may see heat in another closely watched market in real estate – that of home equity loans.

Home equity lending is back, according to a recent article in Smart Money magazine online. Home equity loans enable homeowners nationwide to tap their home’s equity in order to borrower cash. Ideally, that cash is used for home improvements that contribute to your home’s value. But during the years that led up to the recession, these loans notoriously were used for all but that.

Some interesting statistics from the Smart Money article:

-In the Midwest, Associated Bank issued nearly three times more home equity loans in the second half of 2010 compared to the same period in 2009.

-SunTrust Bank, operating mostly in the south and Mid-Atlantic, has issued 25% more home equity lines of credit in the past six months compared to the first half of 2010.

-At Citizens Bank, which has branches mostly in the northeast, HELOC originations were up 35%.

OK, seems like good news, but why? What does this really mean?

Well, for starters, this is great news for homeowners who maybe can’t sell or don’t want to sell because now they can at least work on adding potential value to their homes with renovations and remodels. (If they have adequate equity to begin with, that is.)

So we’re talking potentially good impact on home values over the long term. Although, again, let’s not forget all the other factors that go into home values like jobs, incomes, supply and demand.

A word of caution:

Home equity loans have been controversial since the housing boom days when some homeowners were basically using their homes as ATMs, cashing out to buy the latest SUV or take the family on a once-in-a-lifetime Australian Outback expedition. Lenders haven’t forgotten this – and neither have those homeowners who tapped out so much equity that they now find themselves underwater or foreclosed.

Home equity loans, or HELOCs, can give some homeowners a fantastic boost when used toward the types of home improvement or remodeling projects that actually add value to your bottom line home equity. But used irresponsibly or, one might imagine, as a source of temporary income to get through a prolonged layoff, and they suddenly become much much riskier for all involved.

An increase in home equity lending is a good sign for our economy, but homeowners need to proceed cautiously. Do your homework on how you plan to use the money, try not to overextend yourselves and have a plan for a worst-case scenario in the event that you need to sell much sooner than you anticipated.

For a referral to a lender who does HELOCs, please contact Theresa.

The word is now spreading that those banks with the most REOs like Bank of America and Chase are adjusting their internal workforce to get ready for a big REO push.  It only makes sense…for these banks to fully recover from the big financing crash, they have to get rid of their bad assets.

So buyers, be ready come April…REO inventory is expected to really increase as these banks begin to purge their foreclosed real estate inventory.  But the risk of waiting until April is interest rates.  What will they do?  If interest rates go up just 1%, buyers lose 10-12% in purchasing power.  Did you know that since last summer rates have already increased 1%?  Don’t wait any longer!

Sellers, even more important for you, its time to prepare and think of listing your home earlier this year!  We all know that REOs depress prices and you don’t want to be caught in that, do you?

Please contact me to see how I can help you optimize your home selling or buying plans with the timing of the market.

2011 – it’s the year of the regulators with housing and finance. A major collapse in the banking industry, along with periods of decline in housing have piqued Capitol Hill’s interest in making more laws in the mortgage banking and financial industries.

The first volley of the year is out. Looming mortgage lending rules have everyone sweating over an April deadline for issuing the regulations. The new rules would include requirements on the amount of cash that borrowers have to put up as a down payment for “less-risky” loans.  As you can imagine, there is a lot of disagreement over what these down payment requirements should be in order to provide the right amount of equity for the lending market’s comfort and still be within the average home buyer’s reach.

The regulations aim to prevent future housing market meltdowns. But if not well thought out, these rules could actually contribute to a prolonged sag in the market. No one really knows for sure how this will play out, but here are a few pros and cons of setting down payment requirements that are too high, considering what could happen:

Pros:
-Lenders reduce upfront risk – meaning their losses wouldn’t be quite as severe should the loans go bad quickly.
-Lower lending risk could lessen the number of defaults in the market.
-The mortgage securities investment market could benefit from less risk – fewer defaults would make these investments more attractive. That interest opens up more liquidity in the mortgage finance market.
-Borrowers start with more equity.

Cons:
-The borrower’s upfront costs go up.
-Added buying costs could contribute to a lessening of demand in the entry-level market.
-Home sellers could face lower prices to account for new affordability factors.
-The housing recovery could take even longer to play out.

One unintended consequence also could be that FHA loans become more prevalent – especially for first-time buyers who don’t have the added boost of previous equity. This is because FHA loans require a substantially lower down payment, sometimes as low as 3.5%.

We don’t really know how these changes will affect everyone in the market, but we can expect to see some healthy debate in the coming weeks. We should all pay attention and contribute to this discussion.

Oh how just one week can change the market!  The inventory drop was enough to mention for sure, 2.3%.  Typically late January and February are ramp up time and more and more inventory comes to market.  The positive news is that pending sales are up 2.7% county-wide even though inventory went down.

So what does this mean for you?

Buyers hang in there…sellers will wake up and get their homes on the market.

Sellers, move quickly to get your home up for sale so you can take advantage of the current shortage of inventory.

For more insight into the market, please post a question here or contact Theresa directly.