By: Andrew Kirk of The Record Staff

Courtesy of: Peter Linsey of Park City Real Estate

Park City Board of Realtors president Lincoln Calder refused to say that the market has hit bottom, but on Monday he did acknowledge that his Third Quarter Report reveals signs of improvement.

During the first nine months of 2009, more than $575 million changed hands in real estate deals. That's down 33.7 percent from the same time period in 2008, and down 50 percent from the market's all-time high in 2007.

Still, anyone following the board's quarterly reports recognizes those numbers as improvement. At one point, Realtors in Summit and Wasatch counties were reporting numbers down 75 percent from the all-time high.

Since February, pending sales have only increased.

"We've made up some ground," Calder said. "We're not out of the woods yet, but prices are down enough that buyers are seeing value in the market."

In the past, local real estate experts predicted that sellers would need to begin lowering prices to experience a "thaw" in the market. Lower sales prices are disappointing and painful, but would lead to long-term recovery.

Most of the board's third-quarter numbers suggest that is now occurring.

Median sales prices are down 30 percent from highs in 2008, he said. Park City condominiums are selling for about 23 percent less than last year. Kamas homes are selling for an average of 18 percent less. Sale prices for single-family homes in Park City proper, especially in Old Town, had been holding steady. This report shows the average sale price down 13 percent.

As bad as that sounds, it's finally attracting buyers.

"A lot of those buyers are a drawn in by value. That's the No. 1 motivation," he said. "Those are the deals that are happening right now."

The trend is especially true for single-family homes. Calder said many houses, in contrast to condos, have been bought and sold because families are moving in or out of town. Loans for primary residences are easier to get, and necessity makes negotiation easier.

Condominiums have shrunk to only a third of the overall market because they're usually purchased for speculation or as second or third homes. There's less demand for "spec" homes and vacation properties. Loans for them are also harder to get.

Even though sale prices are down, increased sale volume is decreasing supply, which will eventually bring prices back up, Calder said.

He said Realtors are still struggling, but the activity is heartening.

Also Summit and Wasatch counties are mostly free of the troubles making national headlines. Less than 1 percent of all properties are in some state of foreclosure.

"Our market has never been driven by rampant speculation," he said.

The most talked about real estate in town is too new to be affecting the numbers. There have been a few closings at Dakota Mountain Lodge, St. Regis isn't allowing deals to close yet, and The Montage is not far along enough to begin accepting deposits, he said.

Vacant land sales have been, and continue to be, the weakest sector in the market.

According to the third-quarter report, volume is down from 183 transactions during the first nine months of 2008 to only 86 so far this year. Sale prices are down nearly 11 percent.

Better news is that projections for the state appear positive. According to Metrostudy, which tracks the new-home construction industry, new-home inventory is in rapid reduction in the Greater Salt Lake Area, which includes Summit County.

Inventory has decreased 56 percent in the last year, and 25 percent since the end of the second quarter. Metrostudy estimates it would take 2.6 months to clear that inventory, and two months is considered an ideal balance of supply.

Courtesy of: Cathy Harrington of Prudential California/Nevada Realty

Pleasanton, CA – October 22, 2009 -- The San Francisco Bay Area real estate market continued to show signs of a slow recovery during the third quarter of 2009 behind a dwindling supply of foreclosed properties on the market and increased competition between cash-rich investors looking for deals and traditional first-time homebuyers trying to leverage low interest rates and a soon-to-expire federal income tax credit to completed a home purchase before home prices can edge higher. The report was compiled by the research division of Prudential California Realty, and is an analysis of MLS data.

In the nine-county Bay Area, 14,662 existing single-family detached homes changed hands during the third quarter, up slightly from 14,551 homes sold in the second quarter and 6 percent higher than the 13,895 homes sold during the third quarter of 2008. The median price of a Bay Area home remained essentially unchanged from the second quarter, falling by less than 1 percentage point to $495,327. A year ago, the Bay Area median home sales price was 22 percent higher at $633,786. The decline is attributed to a dramatic slowdown in sales of homes in the highest price ranges over the past year and a steady supply of distressed properties on the market.

For the second consecutive quarter, Contra Costa County led the pace of sales with 3,325 closed transactions, followed by Santa Clara County (3,288 closed sales) and Alameda County (3,001 closed sales). Only Sonoma and Solano Counties reported a quarter-to quarter decline in sales. Sales were down on an annualized basis in Sonoma and Contra Costa counties.

The impact of stronger sales also could be seen n the region’s time on the market statistics. The average number of days a home was on the market before sale in the third quarter essentially was unchanged at 66 days, down from 67 days in the second quarter but up slightly from 63 days a year ago.

The median sales price of a home sold during the third quarter increased compared with the second quarter in Alameda, Contra Costa, Marin, San Mateo, Santa Clara, Solano and Sonoma counties. These increases reflected a significant increase in the number of multiple offers on short sale, foreclosed and other entry-level and investment-grade properties and a modest improvement in prices in moderate- and higher-priced pockets of most counties. .

“Looking ahead, buyers expecting rock-bottom prices on bank foreclosures may find those in shorter supply in the months to come unless lenders unleash a flood of new properties. Increasingly, lenders are agreeing to short sale transactions, but buyers making offers on these homes will find stiff competition unless they have sizeable down payments or all-cash,” said David Gardner, Managing Director, Prudential California Realty. “First-time buyers will continue to seek homeownership opportunities, and their presence as a market force will be boosted if the federal government decides to extend the $8,000 federal income tax credit for first-timers beyond its scheduled December 1, 2009, expiration date.”

Third Quarter 2009 Housing Market Survey – Bay Area Counties

Single-Family Detached Homes

	Homes Sold Q3/09	Homes Sold Q3/08	% Change	Avg. DOM* Q3/09	Avg. DOM Q3/08	Change 09/08 (Days)	Median Price** Q3/09	Median Price Q3/08	% Change
Bay Area	14,662	13,895	6	66	63	3	$495,327	$633,786	-22

Third Quarter 2009 Housing Market Survey – Bay Area Counties

Single-Family Detached Homes

City	Homes Sold Q3/09	Homes Sold Q3/08	% Change	Avg. DOM* Q3/09	Avg. DOM Q3/08	Change 09/08 (Days)	Median Price** Q3/09	Median Price Q3/08	% Change
Alameda	3,001	2,671	12	46	47	-1	$389,268	$469,248	-17
Contra Costa	3,325	3,578	-7	53	61	-8	$344,434	$390,180	-12

Marin	459	459	0	75	63	12	$842,335	$994,941	-15
Napa	195	178	10	106	83	23	$360,000	$449,008	-20
San Francisco	626	619	1	49	50	-1	$860,863	$1,003,603	-14

San Mateo	1,086	1,067	2	68	52	16	$862,432	$932,379	-8
Santa Clara	3,288	2,764	19	55	48	7	$647,908	$753,644	-14

Solano	1,470	1,310	12	57	76	-20	$203,060	$265,593	-24
Sonoma	1,212	1,257	-4	88	91	3	$363,811	$393,210	-7
Bay Area Total	14,666	13,895	6	66	63	3	$495,327	$633,786	-22

* Days on market is the number of days a property was listed on the market until it went under

contract at its final listing price. This may not reflect previous listings.

**The median home price for the entire county is the weighted mean of median home prices of

cities within the San Francisco Bay Area.

Data are sourced from multiple listing services and are deemed reliable but not guaranteed.

All percentages rounded to nearest whole number. Bay Area refers to sales within Alameda County, Contra Costa County, Marin County, Napa County, San Francisco County, San Mateo County, Santa Clara County, Solano County and Sonoma County.

Produced by the Prudential California Realty Research Division.

About Prudential California Realty:

Founded in 1887 as Mason-McDuffie Real Estate and transitioning to the Prudential name in 1997, Prudential California is a leading innovator of real estate technology solutions to its agents and clients. Prudential California Realty provides comprehensive real estate solutions when buying, selling and owning a home with more than 6,500 transactions and $3 billion in annual sales for 2008. The company offers consumers full MLS access to home listings through its website www.PruRealty.com. Owned by David Cobo and Ed Krafchow, the organization cumulatively has more than 1,800 agents and 40 offices. Prudential CA/NV is an independently owned and operated member of the Prudential Real Estate Affiliates.

Courtesy of: Jim Walberg of Caribbean Islands Realty

Jim Walberg states that all real estate is local, remember? The Bay Area home sales for September were up 8.4%. It doesn’t matter what the National averages are, it only matters what the stats are in our local market. And within our local markets are niche markets. Do you really care about what the statistics are in Kansas City? No. What you care about is what is happening with home sales in the East Bay real estate markets. But, here is the info from September’s home sales anyway. Last month was the largest monthly increase in home sales in the U.S. in the last 26 years! That is great news for our economy. I believe that the reason why September was so robust in home sales was because of the panic that the Home Buyers Tax Credit was ending on November 30^th. ( We now know that Senator Harry Reid is authoring a bill to extend it to April 30, 2010.) The September jump in homes sales revised the projected home sales for 2009 to 5.57 million! “There’s a mini-boom going on in the housing market,” said Thomas Popik, who conducts a monthly survey of real estate agents for Campbell Communications, a research firm.

Nationally, home sales are up almost 24% from the bottom last January. However, they are still down 23% from 2005. What is still dragging down prices are Foreclosures and Short Sales. Now, this is where we go back to, “all real estate is local”. The median price of homes last month, Nationally, was $174,900, with a bit less than eight months of inventory given the current pace of sales. California’s median home price last month was $251,000 which was down 11% from $283,000 a year ago in September. Back to local…if you look at the East County months of inventory is around ONE MONTH! San Ramon is three months. Dublin is under two months. This confirms that ALL real estate is local.

	Sales Volume			Median Price
All homes	Sep-08	Sep-09	%Chng	Sep-08	Sep-09	%Chng
Alameda	1,410	1,681	19.2%	$389,500	$358,000	-8.1%
Contra Costa	1,780	1,607	-9.7%	$300,000	$262,000	-12.7%
Bay Area	7,271	7,879	8.4%	$400,000	$365,000	-8.8%

Who are snatching up homes right now are first time home buyers and investors. They are taking advantage of low interest rates on mortgages, plus the tax credits that have been available the past year. This tax credit has been so important to them that many are adding in a clause to their purchase contracts that states the are able to back out of their purchase if the sale doesn’t close before November 30^th. ( This may be a mute point if the current proposed Senate bill passes in the next week or so.)

Joseph LaVorgna who is the chief U.S. economist from Deutsche Bank stated, “We think the housing market has touched bottom and it is now only a matter of time until home prices stabilize — something that we anticipate to occur in late 2010.” I still believe that the unemployment issue will continue to cause more foreclosures, no matter what part of the country we live in. Zillow.com’s chief economist, Stan Humphries said, “There’s more supply that’s going to come into the marketplace. That additional supply will outpace demand.” So, is the solution the extension of the home buyers tax credit? Some of the analysts are saying the tax credit may not be as critical to the housing market as the real estate industry is suggesting. The chief economist of Nomura Securities stated, “The group has an incentive to talk up the effects of the credit as it is urging Congress to extend it, and it therefore may be exaggerating the credit’s effects.” In fact, the Treasury Department is questioning whether over 100,000 tax credit claims are illegal. There is even a taxpayer application that has been discovered from a four year old. This revelation will not help Congress with their rationale in passing an extension of the tax credit.

However, last month, John Walsh, the president of DataQuick said, “This market may be closer to normal than it was a a half year ago, but it’s still out of kilter, fueled in large part by incentives and the processing of distressed properties. The sales mix is still lopsided, tilting toward the low end, and lending institutions are only making really safe mortgage loans. For those who can buy, there are some very attractive opportunities. But it still looks like a lot of normal supply-and-demand activity has been put on hold until the economy comes back.” What are your thoughts about our local real estate markets?

Courtesy of: Jim Walberg of Caribbean Islands Realty

Tax Credit Update From Jim Walberg: Last week I sent out the alarm for home buyers to take action or lose out on the Federal tax credit that is ending November 30^th. Today Senate Majority Leader Harry Reid said that the Senators have actually agreed to extend the First Time Homebuyers Tax Credit past November 30^th. The proposal on the table has the $8,000 credit extended until April 30, 2010. PLUS, a $6,500 tax credit would be given to homeowners who have lived in their house for the past five consecutive that purchase their next primary residence. The credit would be available to individuals who make less than $125,000 a year, or couples who make less than $225,000. This is $50,000 to $100,000 more than the last income ceiling in order to qualify. A strategy that is being proposed in order to have it accelerate through Congress is by attaching the bill to the one extending unemployment benefits – a smart move by Senator Reid.

 

The green light was given to Senator Reid and Congress from President Obama when the administration asked Congress to give future homeowners more time to receive the tax credit. Treasury Secretary Tim Geithner and HUD Secretary Shaun Donovan stated today in a joint statement, “We welcome efforts taken by Congress to extend the first-time home buyers tax credit for a limited period. This credit has brought new families into the housing market and contributed to three consecutive months of rising home prices nationwide.”

Moodys Economy.com’s chief economist, Mark Zandi, believes that the original tax credit that is to end by November 30^th will have created up to 400,000 home purchases when all the smoke clears. The National Association of Realtors, and the Home Builders Association

have both been stating that failing to extend the tax credit would seriously impact the recent signs of stability in the housing market. Just yesterday, the Home Builders Association blamed weaker new home sales because of the expected end to the first time homeowner’s tax credit at the end of this month.

Not only is the deadline proposed to be extended to April 30, 2010, but the rules of what a “deadline of April 30, 2010” means has been changed. The current tax credit rules states that the home must close escrow by November 30, 2009. That is why there has been such a rush the past four weeks to complete the loan process for any purchases that qualify for the credit so they can close escrow by the end of the month. It has been a mad house at all of the mortgage lenders offices. The proposed extension states, “A buyer must have a sales contract on a home by April 30^th to be eligible, but gives them an additional 60 days to close the escrow on the home.” This actually means that the deadline to receive this credit is June 30, 2010 for any purchases that qualify!

The BIG NEWS regarding this proposed extension is the expansion of it to current homeowners who are move-up buyers. This is THE key group of home buyers that are critical to the recovery of the housing crisis. Also, with expanding the amount of income a person can earn in order to qualify, it will encourage a host of buyers into the game. So, both first time buyers and move-up buyers can use this tax credit as long as the home is no more than $800,000. They can also take the tax credit on their 2009 tax return even if it is purchased in 2010. Remember, that the tax credit does not have to be repaid if the buyer lives in the home for three years or more.

There is a BIG downside to extend the tax credit. Mark Zandi has estimated that the current tax credit has already cost the Feds over $10 billion in lost income taxes. He believes the current proposal will cost more than $10 billion in additional income tax loses. There are critics of the tax credit that say the Feds have paid $43,000 for every additional home sale the past two years! Zandi does concede that the proposed bill to extend the tax credit would create a significant amount of home sales. But, is the trade-off worth it. All aspects of the economic recovery are fragile today. If this credit is not extended it may set us back a year or two with any further recovery possible. CLICK HERE for more information on how this tax credit could benefit you. Until next time…your East Bay lifestyle detective remains on duty.

Courtesy of: Katrina Campins of The Campins Company

Katrina Campins, entrepreneur and star of Season 1 of  NBC's The Apprentice and Bravo's Miami Social, annonces that her Website has been revamped with a new and improved design. The Campins Company out of Miami, Florida launches its brand new website today! The Campins Company specializes in luxury real estate in the Miami real estate market. Featured on the website are virtual tours of several properties as well as a convenient search tool to find your perfect home in Miami! Visit the site now, and see how The Campins Company can assist you!