San Jose Real Estate Housing Market Update

The past year has been challenging. We've had a shrinking inventory of available homes for sale and more and more buyers wanting to buy the low bargain priced homes. In Santa Clara County we saw most sales being gobbled up by investors and first time home buyers last year. According to Matrix, 70% of the actual sales for Condos/SFH in Santa Clara County within the price range of $200K and 400K were distressed property. That means that only 3 out of 10 homes sold in this price range were what we Realtors refer to as "Regular" or "Normal" sales. If you lived in a 200K to 400K neighborhood and had some equity in your home, would you have sold in 2011? Probably not.

San Jose Real Estate Sales in 2011

Of all the Distressed Properties Sold in 2011, almost 7 out of 10 Single Family Homes sold were under 600K price range.

The chart below shows us the number of distressed sales (Short Sales/REOs) in the year 2011 for SFH for all price ranges.

Half of all the distressed sales for SFH in 2011 in San Jose were between 200K and 400K.

According to RealTrac, inventory of bank owned property is expected to increase in 2012 in California. California has been and will continue to be a place where REO properties ate a hot commodity. Cash investors compete with first time buyers for a chance to buy low priced homes everywhere. There is foreign money pouring in from all over the place (especially from Canada and China). I have listed and sold REO properties to foreign investors wanting to snap up bargain deals.

Will Inventory Remain Low in 2012?

According to RealTrac, the number of notices of default and lender repossessed properties declined in November 2011. However, a leading indicator points to a higher level of potential foreclosures on the 2012 horizon. There was a 63% month over month increase in scheduled foreclosure auctions in California in November 2011 which is the highest rate increase in the US.

According to a report released January 25, 2012, NAR Economic Forecast of existing home sales are expected to grow from 4.26 Million homes sold in the US in 2011 to 4.45 Million homes sold in 2012. NAR Research also forecasts another growth in 2013 to 4.62 Million. The NAR report stated that 2011 Median Home Prices on existing homes was $166,100 and would grow in 2012 by 1% to $167,300 and then would grow another 3.2% in 2013 to $172,600. This means that we have hit bottom and we are on our way up.

The California Association of Realtors did a similar forecast in September of 2011 and predicted that Median Sales Price in California would grow 1% from $291,000 to $296,000 in 2012.

If you are a buyer waiting for the perfect time to buy a home, I am telling you that this is the best time to buy. Are you tired of renting? Don't get stuck paying off someone else's investment.

According to CAR's Housing Affordability Index, 60% of Santa Clara County's households can afford to purchase their first home. If your household income is at least 73K and can afford a monthy payment of $2,460 then you can buy a home in California.

I can help you buy a home with at least 3% down payment and low mortgage payments that feel like rent. Please call me today at (408) 460-8401.