Joe Capote

July 27, 2009 • 7:43 pm 0

San Bruno Weekly Real Estate Stats Roundup 07/27/09

Here are the weekly real estate stats for San Bruno and San Mateo County

San Bruno:

  • New listings: 7
  • Condo/Townhome: 3
  • Mean Price: $603,325 (single family residence)
  • Mean Price: $162,796 (condo/townhome)
  • Median Price: $669,250 (single family residence)
  • Absorption Rate: 8.9
  • Total Listings: 51

New listings are down 3 from last week. The mean price for a single family residence is down, but the median price is up. The absortpion rate is down .06 from last week.

Overall numbers are flat from last week. The unemployment rate nationwide is at 10.5% with 30,000 new claims over the past week. Consumer confidence numbers trickled up slightly, but umemployment concerns continue to drive uncertainty.

Filed under: Market Data

July 21, 2009 • 9:58 pm 0

Venture Capitalist Funding Half of Last Year

This article appeared in the business and technology section of the San Jose Mercury News this morning. According to this article, venture capital investing rose modestly nationwide over the last quarter, but still at 3.7billion total is only half of what it was last year. This means that venture capital funding is on track to end the year at it’s lowest levels since the mid 1990’s, before the boom of technology resulting in the internet as we know it today.

Additonally, the bay area’s share of this pie has declined as well. Venture capitalists invested 1.8 billion in bay area companies this quarter, a downturn of 61% from the second quarter of 2008. According to John S. Taylor, VP of resarch at the National Venture Capital Association, the small numbers are a result of lack of available capital and the rise in reserves by VC’s to support their earlier investments. Furthermore, Mr. Taylor indicated that the stock market crash has drastically altered the portfolios of institutional investors, who are rebalancing by pulling back on additonal funding.

This information does not bode well for the economy of the Silicon Valley as well as the SF/Peninsula as a whole. Startups funded by venture capitalists provide a wealth of jobs in the technology sector, and the innovations they provide have a resonating effect in other areas. For example, Facebook was a venture capitalist funded startup, and it’s success fuels all sorts of venure capitalist funded technology companies that build applications and services for the Facebook service and  platform. In turn, in order to support all these services, companies require major infrastructure purchases (servers and software from companies like HP), technology and consulting services (IBM and Accenture) and back office software to support the workforce (Microsoft Office, accounting and budgeting software). . In addition, established companies, as a result of lost sales from this fall out, continue to cut costs in the form of layoffs and flattened spending.

As real estate indicators are trending upward and home sales in Santa Clara county hit a 3-year high (San Jose Mercury, July 17), today’s news continues to drive uncertainty into an already uncertain employment and consumer market. According to Mr. Taylor, “Unless there is a significant increase in IPO’s or acquisitions, or unless captial becomes plentiful, I don’t see this changing much of the paces for the next few quarters”. 

As real estate professionals, we need to continue to be persistent with our contacts and improve our knowledge and skillsets. As we live and work in or around the Silicon Valley, we should be sensitive to venture capitalist money and how it relates to our overall economic ecosystem. As these numbers improve, our overall opportunities for business should improve along with it.

Filed under: Realtor Trends, Technology, , , , , ,

July 20, 2009 • 9:11 pm 0

San Bruno Weekly Real Estate Stats Roundup

San Bruno Weekly Real Estate Stats Roundup

  • New Listings                10
  • REO                            3
  • Condo/Townhome        2
  • Mean (SFR)                 $622687
  • Median (SFR)            $612000

Calculating the Absorption Rate

The definition of the real estate absorption rate is the number shows the rate at which the inventory of homes for sale are being sold (www.wikianswers.com). A declining figure indicates people the inventory is decreasing as more homes are being sold than are coming onto the market. A increasing number indicates that the inventory is increasing as less homes are being sold that are coming onto the market. Pretty basic information, all REALTORs are aware of this. What I find interesting is that there are a couple of ways to calculate an absorption rate from what I’ve seen. Instead of a debate, I will quote the formula used by Realtor Magazine (http://www.realtor.org/RMODaily.nsf/pages/News2007111404)

  • First, determine the number of homes closed in your market over a specific period — say, 12 months. You can get this data from the MLS.
  • Next, divide the number of homes by the number of months in the period — in this case, 12. This calculation gives a per month absorption rate.
  • Last, divide the rate into the number of current listings. This yields the months’ supply of homes.

By this calculation, the current absorption rate for San Bruno (I use a 30 day rolling window) is 9. Since I’m using a weekly number and not a monthly number as described above, this is the week’s supply of homes. 

I’ve also seen this number calculated this way:

  • Number of listings sold in a month (30 day rolling window)
  • Multiply this number by 12 for a monthly total.
  • Divide the product by 52 for a weekly average
  • Divide this number into the number of active listings on the market.

By this calculation, the current absorption rate for San Bruno is 9.4

  •  Sold Properties             24 x 12 = 288 / 52 = 5.5 per week
  • Current Active Listings 54 / 5.5 = 9.4

Let’s follow this rate over the next few weeks to determine the trend in the San Bruno Marketplace.

Filed under: Buyer's Blog, Market Data, Seller's Blog

July 18, 2009 • 4:41 pm 0

The Green Building Products Poll

Would you use green building products in your new or existing home?

Thanks for your participation!

Filed under: Uncategorized

July 17, 2009 • 11:46 pm 0

Time for the Green Designation?

Like a lot of us hippie liberals (thats what dad would have called those who follow whole green movement), I am concerned about the environment and that state of what I’ll be leaving behind for my kids. Over the past couple of years, there has been a real movement in all things green and the environmentally sound goodness from green products and services. I was first exposed to the green movement in the IT world, as green computing began it’s ramp up (less power, more efficient comuting resources and fully recyclable computing products). Heck, even here at the office we buy all of our computing equipment from GreenCitizen (www.greencitizen.com). So, it came as no surpise to see this movement in the Real estate world. Eco-friendly green products are now on sale in most major purveyors of home improvement products,  encompassing everything from countertops, drywall to windows and flooring tile. Green products such as household cleaners and other eco-friendly goodies crop up all the time. Heck, even the NAR now recognizes the official Green designation, the sustainable housing effort sponsored by the Green REsource Council. (http://www.greenresourcecouncil.org/).  So I wondered aloud, how does the Green designation translate into a competitive advantage for the Realtor. After realizing I was talking to myself and that the folks around me were shaking their heads in disapproval, I decided to find out.

For a mere couple of dollars and a three day class, you too can achieve the Green designation, a “comprehensive training and access to cutting-edge resources and tools as well as promoting green excellence, leadership, and consumer awareness within and across multiple real estate disciplines.” (http://www.realtor.org/education/realtor_university/designation, par 13). Sounds great! After all, Kermit the frog was green, and loved being green though it wasn’t easy being green. In any event, sign me up. But wait, I have some questions. Before I drop down the money, time and effort for the green designation, how much business or competitive advantage can I expect from the designation? What marketing tools will I have access to once I achieve the master rank of all that is green? Will this comprehensive knowledge allow me to quickly compute the ROI for my clients investment in green products such as energy efficient windows and THX certified soundproof doors? Will I be admonished with respect after educating my sellers on the benefits  super-insulated drywall and the 380-800% increase in insulating value it provides? After all, these numbers do not translate directly to monetary savings, so I would assume that at some point someone is going to ask me what being green really means to them.

In the IT world, being green was a somewhat quantifiable means to an end. Green computing resources utilized lower power and required less heating and cooling than their non-eco friendly, non-green counterparts. IT managers could review the operational cost of the data center resources, calculate the operational cost savings to be achieved by implementing green computing resources, and ultimately understand how long it would take to achieve the return on investment. But in the world of Real Estate, this seems more complicated to achieve. What mathematical formula should I use to promote green awareness across multiple Real Estate Displicines? To find out, I went to the source, the green council website at http://www.greenresourcecouncil.org/. Under the course information, I found the following learning objectives:

  • Explain to your clients what makes a home, building or property green
  • List and market green properties
  • Implement green practices into your life
  • Determine the energy efficiency of a property
  • Help your clients take advantage of green grants and incentives
  • Assist your clients in their efforts to go green
  • Build coalitions with community planners and groups to further resource-efficient communities
  • Explain to your clients what makes a home, building or property green
  • List and market green properties
  • Implement green practices into your life
  • Determine the energy efficiency of a property
  • Help your clients take advantage of green grants and incentives
  • Assist your clients in their efforts to go green
  • Build coalitions with community planners and groups to further resource-efficient communities

    • Now this makes more sense. The ability to determine the energy efficiency of a property and ways that green products can reduce costs is a key component to convincing buyers, sellers and investors in the merits of green-ness. According to the Healthy House Institute, most folks polled appeared to be “more focused on doing what they can to save money rather than what they can do to reduce energy consumption. “I’m doing a lot to help myself and save money,” one focus group participant said. “I don’t go out of my way to be green.” (http://www.healthyhouseinstitute.com/a_983-Cost_Savings_Energy_Efficient_Appliances_Highlight_Consumer_Focus_on_Green, par 7). This makes sense, after all, most all homeowners and investors want to know whats in it for them. Ultimately, it is how much they will save that will sell them on green products, while the environmental friendliness is simply the green icing on the cake.

    So is the world ready for the benefits of the Green Designation for Realtors? Overall, I think that the full benefit of Green products will get realized when their price points align with their non-green brethren. This appears to be two to three years off, from the opinions of my resources. But the cost savings in green products promises to get better and better as technologies and production strategies evolve. And all of us can find benefit in cost savings. After all, even my crusty old dad thought the ‘hippie liberals’ were out of their minds, until they started saving him money.

    Filed under: Realtor Trends, Technology

    July 16, 2009 • 1:46 pm 0

    First Time Homebuyer Federal Tax Credit: Time is Running Out For Buyers

    The Chicago Tribune reported this note that time is running shorter than we realize with regards to the first time homebuyer tax credit.

    First-Time Buyers: Hurry for $8,000 Tax Credit
    It’s time to remind first-time home buyers that in order to qualify for the government’s $8,000 gift in the form of a tax credit, the deal must close by Dec. 1.

    Buyers should have a purchase contract signed by early October, so they have 45 to 60 days to arrange financing and safely close the deal.

    “There’s not as much sand in the hourglass as we may think,” said Jim Merrion, regional director at RE/MAX Northern Illinois.

    Source: Chicago Tribune, Mary Ellen Podmolik (07/11/2009)

    It’s time to get those buyers off the fence and into homes! Time to incorporate a countdown on your website today, if you have not alread done so.  Drip marketing campaigns should work to incorporate this information as well.

    Filed under: Buyer's Blog,

    July 15, 2009 • 7:29 pm 0

    Five Technology Tools for Real Estate Agents

    Real Estate and technology. There is a marriage made in, well, h-e-double hockey sticks. My mother, Marilyn, was a successful realtor for thirty years (her first office had an 8 track player, and a video tape recorder that was the first VCR I had ever seen). While she embraced email and the internet towards the end of her career, it would be hard to imagine my mom “tweeting'” or using any type of scheduling/calendaring software because it did not integrate with her old school hard cover daily planner. However with most industries, real estate professionals have found that embracing technology is far better than running from it. Additonally, most are realizing that technology means more than just ‘social networking’ or standard back office functions. There is a wide range of free products available, and James Kimmons from About.com does a good job of listing them up. I’ve borrowed from him as I use these myself, but I offer the additonal stimulating commentary free of charge.

    1. Gmail for Lots of Things Gmail does lots of things well. It’s great for small business, offers exception email search capabilities, it’s a SaaS platform (a cute way of saying it’s online all the time, and requires no installed software), categorizes emails well, keeps the email thread in a string for easy following of conversations and offers tons of storage. Plus, it doesn’t go all wonky, slow and stupid like the outlook client does. Ever had to restore your outlook file or crop it because it went over 2gb? It stinks, leave that to the IT guys, even they hate it. Gmail is robust and does not have such issues. It sends a strong message of technical credibility, unlike those who are still using AOL (Agent Out of Luck). The only downside is trying to find an email address that isn’t something like funkelburger05458@gmail.com, although there are ways around that.

    2. YouTube for Video Marketing – Youtube is an awesome tool for realtors. Place videos of your listings or property previews online for your sellers. Create marketing and training videos and link them to your website. It’s fast, easy and free. New camera technologies (like the FLIP video camcorder) make it really easy to film and upload your movies. Hurry up and use this now, before Google figures out that the cost of running the business on top of the 1.65 billion they spent is going from ‘incredible business opportunity’ to ‘loss leader’.

    3. Google Calendar for Time & Task Management – Google calendar is free, online (there is the SaaS thing again) and does not crash and burn like outlook. You can schedule events and invite others using their email, and allow them to get notifications prior to the meeting. It integrates with custom agent and broker solutions like e-agents. It doesn’t handle office resources (say like your meeting room schedules, but who doesn’t enjoy a good no-holds barred cage match over a meeting room scheduling conflict)? PROTIP – use the same username for all google services, that way you can switch from one service to the next (say like google analytics, calendar and Youtube) and enjoy all of the integration benefits.

    4. WordPress – The ONLY Blogging Solution – Forget MSN spaces or even blogger. These are OK for most folks, but WordPress is a free blogging platform that offers an online version (All SaaS-y and stuff) or a server version with more features, functionality and control. Create a blog, choose and modify a template color scheme, categorize posts, add helpful plugins and get full use of RSS functionality and imbed to your site (broker and agent solutions included).

    5.Google Analytics – If your are not using Google analytics to analyze the traffic on your website, your should do so now. While you may need some help from your IT or technical support folks if you are unfamiliar with HTML, the benefits you will reap will be worth the effort. There are a number of canned and custom reports available, and almost immediately you will see the data. Page views, bounce rates, referring sites, geographic locales are there, to name a few. Want to know what percentage of your visitors are referred from twitter and how much time they spend on your site? Google analytics is for you. Please don’t be intimidated by these tools. They are easier to implement and use than you think. Trust me when I say there is no need for the legions of operations engineers whose sole existence hinges on the practice of gathering and analyzing this information. Although if you’d like to spend hours understanding the incredibly fast paced, exciting and high profile world of incident management, don’t let me stop you.

    That wraps up the five tools I think are awesome for Real Estate. Marlilyn would be proud, but still would not relenquish the hard bound old school daily planner. Oh well. Thanks again to James Kimmons.

    Filed under: Technology

    July 13, 2009 • 5:32 pm 0

    The Facts on the First Time Homebuyers Tax Credit

    Introduction

    Did you know that right now is a great time for first time homebuyers to enter the Real Estate market? The competitive prices of existing homes coupled with the first time homebuyers tax credit, up to eighteen thousand dollars (state and federal) for those who qualify, makes it a really attractive for first time homebuyers to own their own home. But remember, the first time homebuyers tax credits will only be available to properties that close before December 1, 2009, so the time is now. To find out if you qualify for the first time homebuyers tax credit, or if you would like to discuss your options as a first time homebuyer in today’s real estate market, schedule a FREE no obligation consultation.

    The Basics

    First-time home buyers who purchase a home to be used as a primary residence before December 1, 2009 are eligible for a tax credit equal to 10 percent of the value of their home purchase up to $8,000. To qualify as a “first-time home buyer” the purchaser and his/her spouse (if applicable) may not have owned a residence during the three years prior to the purchase. The credit is subject to income limits. Single buyers with incomes up to $75,000 and married couples with incomes up to $150,000 may receive the maximum tax credit. The credit decreases for single buyers who earn between $75,000 and $95,000 and for married buyers filing jointly who earn between $150,000 and $170,000. Home buyers earning more than the maximum qualifying income—over $95,000 for singles and over $170,000 for couples are not eligible for the credit. Unlike the credit for homes purchased in 2008, the tax credit for purchases in 2009 does not need to be repaid unless it ceases to be the primary residence of the tax credit recipient within three years after the purchase. In that case, the credit recipient will owe the full amount of the credit at that time the income tax return for the year the home ceased to be your principal residence is due. (i.e. You sell your home on January 1, 2010 or December 31, 2010; the full amount of the credit is due when your tax return is due on April 15, 2011.)

    Available at Closing!

    You may have heard that some states make the funds for the tax credit available for the borrower at closing. This is particularly helpful for cash strapped borrowers who need to cover closing costs. However, this option is supported on the state level, and is NOT available in California at this time.

    More Information

    Of course sometimes it’s nice to go straight to the source. The IRS has some helpful web pages on the tax credit, too. Check out the overview page.

    Also be sure to visit the “Scenarios” section of the question and answer page for guidance on issues such as splitting a credit between non-married persons, having cosigners, how to handle the credit for married couples. For further clarification, consult with a tax attorney.

    The tax credit is a great opportunity for first-time buyers, but it is only available for a limited time. To see if you qualify or would like further information, please contact me for a consultation.

    Joseph Capote

    Filed under: Buyer's Blog

    July 9, 2009 • 8:58 pm 0

    Unemployment Data

    Greg Stratton, Research Economist for the NAR has posted this weeks unemployment numbers for our review.

  • Initial claims for the week of 7/04/2009 dropped below 600,000 for the first time in nearly five months.
  • This past week’s number of initial claims was 565,000, or 52,000 less than the previous week. This beat expectations as economists only expected a weekly decrease of 4,000.
  • Some of the decrease is attributable to an acceleration of auto layoffs into the spring that normally would have occurred in July.
  • Continuing claims increased from the previous week by 159,000 to 6.883M, and are 3.8M greater than the same week last year.

    •  This data indicates the labor market is still pretty slow. Companies are not hiring with any relative gusto. Unemployment claims for this week are up over 50% from what they were in the same week last year. A source close to me indicates that there is so much activity at the California EDD that they are unable to accept any calls at this time. However, as seen in previous markets, the real estate market will begin to pick up before the unemployment numbers begin to get better.

    Our friends at the National Association of Realtors predict that the GDP and home sales will begin to improve in the third quarter in comparison to the previous year. These are good indications. As is tradition that the real estate markets lead us into recessions, they are also first to improve on the way out.

    Now if we could just get a turniquet around government spending.

    Here are the official NAR numbers:

  • GDP Q2: – 1.0%
  • GDP Q3: +0.2%
  • GDP Q4: +1.0%
  • Unemployment rate by the end of 2009: 10.5%
  • Average 30-year fixed mortgage rate by the end of 2009: 5.4%

    • As I have been saying in previous posts, those with the desire, need and ability to buy should aggressively do so. The current attractive home prices coupled with the first time homebuyers tax credit make it a better time than ever before to become a player in the Northern California Real Estate Market. The Tax Credit only applies to purchase transactions that CLOSE before December 1, 2009, so time is running out.

    For more information as to whether or not you qualify for the First Time Homebuyers Tax credit, please look at my Buyer’s Center or contact me directly.

    Filed under: Market Data

    July 6, 2009 • 10:21 pm 0

    San Mateo County Real Estate Market Data – June 2009

    San Mateo County Real Estate Market

    The end of June in the San Mateo County real estate market saw another month of slow growth and strengthened indicators. While the current inventory numbers fell 6.5% overall,  the closed sales rose 23.5% for the month while the average days on the market dropped by nearly 9%. The median sales prices continue to rise, up 5% in June from $728,000 to $765,000. Average sales prices in San Mateo country rose  in June as well, up 2% from $933,698 to $945,717. Total sales volume in San Mateo county rose nearly 25%.

    San Bruno Real Estate Market

    Here in San Bruno, the indicators aligned with what San Mateo County is doing overall. While new listings for the month dropped slightly and average sales price remained flat, the average days on the market fell 16% while the number of sales rose by 23%.  Total sales volume rose sharply from 7.3 million to 9.5 million, a 23% increase.  The current absortpion rate for San Bruno is 0.62, meaning that there is roughly 2-3 weeks before currently available inventory will be purchased.

    Overall

    Though the amount of available inventory on the market continues to remain short, market indicators in San Bruno and San Mateo county continue to rise. Buyers are finding competition for available homes in the form of multiple offers and offers in backup position, while sellers are finding a better than expected demand for available homes. While the recent unemployment numbers continue to drive uncertainty in the market, buyers are finding that the market pricing has bottomed out and is rebounding up. Those with the means to buy should place a premium on buying this year, as the upward trends in the market coupled with governement incentives such as the first time homebuyers credits should continue to propel the markets.

    For further information or to discuss whether or not you qualify for the first time homebuyer tax credits, please contact me for a no obligation consultation at your convenience.

    Joseph Capote

    Filed under: Market Data

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