http://www.huffingtonpost.com/rj-eskow/getting-medieval-on-your_b_775482.html

According to DQNews.com California mortgage defaults rose in the third quarter. See article at

http://www.dqnews.com/Articles/2010/News/California/CA-Foreclosures/RRFor101026.aspx

Therefore this temporary slow-down will not stop foreclosures. The bottom line is that if borrowers do not pay back the loan they signed for, they will lose their property. Period. That will not change. So the question is “will this slow-down have a negative effect of real estate’s recovery”. My opinion is that it most definitely will exacerbate the already huge problem.

You must first understand what happens when a bank forecloses on a property. The banks are the most aggressive sellers in the market. By that I mean they will offer their properties at very reasonable prices, thereby setting lower comparable sales that appraisers will use to value your home. If you as a seller want to compete with the banks listings you’ll be very disappointed at the price at which you must list your home in order for it to sell.

Right now there are over 1,000 distressed properties in Marin (see chart below). Distressed properties fall into 3 categories: pre-foreclosure, auction and bank owner (REO).

Pre-foreclosure means that they owners have been given a Notice of Default by their lender. A lender generally sends out a Notice of Default after a borrower is late by 2 – 3 payments. The bank now has the right to foreclose after another 90 days if the loans is not brought current (paid up to date).

Auction means the lender has set a date to auction the property on the “steps of city hall”. If it doesn’t sell then, it becomes……

Bank owned. The property’s title has now been transferred to the lender and they own it out right.

Until the foreclosures stop because the loan crisis is over and until all of the foreclosed properties are put on the market and sold we will not have a stable market. After this crisis properties for sale will compete only with other sellers and not with bank properties. Then and only then will true market conditions regulate values, stabilization will occur and we will begin to make a move towards appreciation. That, by the look of our market at this moment, is still quite a ways off.

Town                                Pre-Foreclosures            Auction           Bank Owned (REO)

Belvedere                                4                                  2                                  2

Tiburon                                    10                                16                                18

Mill Valley                               28                                42                                39

Corte Madera                          12                                18                                7

Larkspur                                   4                                  13                                5

Greenbrae                                13                                7                                  5

Kentfield                                 1                                  3                                  6

Ross                                        1                                  3                                  0

San Rafael                               113                              132                              108

Novato                                    147                              179                              109

Fairfax                                     16                                9                                  11

San Anselmo                          16                                9                                  17

As an example, I often mention the “absorption rate” of our current inventory of Single Family houses. That rate is calculated by dividing our active listings by the last full month’s sales. Not the most accurate long-term information but great as a “snap-shot” of the market.

Currently there are 971 active single family homes available for sale and there were 217 single family houses sold in June 2010. The rate is 971/217 equalling 4 1/2 months. (I am NOT including condominiums and townhomes in my analysis as they constitute a different market than single family homes.)

An absorption ate of 4 1/2 months would be a huge improvement if it were county-wide. However, a quick look at two Marin towns will illustrate the disparity in our market. 

Novato has 167 active single family homes and sold 49 in June. The absorption rate is 3 1/2 months. As the number of months in the absorption rate decreases the closer that market is to stabilzating and potentially becoming a “sellers’ market”. 3 1/2 months is a solid indication that Novato’s real estate market is stabilizing.

Now let’s look at the opposite end of the spectrum in Belvedere. Belvedere has 37 homes for sale and had 4 sales in June. That translates to 9 1/4 months for absorption. Quite a different story than Novato’s and one that indicates continuing price reductions for Belvedere.

Here is the breakdown of units sold and average square foot prices for the ENTIRE county:

June 2009  186 sales with an average square foot price of $478.46

May 2010   190 sales   with average square foot price of $495.13

June 2010  217 sales with an average square foot price of $474.86

To buyers this a tough market but one with trremendous opportunities – soft prices, abundant inventory and historically low 30 year fixed mortgage interest rates.

For sellers this is a hellish market. Buyers are extremely tough in their negotiations and are prepared to walk away from the transaction without getting certain seller concessions regarding inspection findings, possible undervalued appraisal, etc.

As they say – no pain, no gain. There will be continued pain in the market but, hopefully, with the understanding that the pain is necesary for us to attain the market stabilization we so desperately need.

As usual I must qualify the following information by saying that each town and each neighborhood within that town has a very specific performance statistics. The following infomation in County-wide. Feel free to contact me for information specific to your property.

2009 Year End Square Foot Prices

vs.

January 1 thru March 31, 2010

Square Foot Prices

    * % Change from Last Year

Town	Current	# Sold in	# of Months
	Inventory	January ’10	of Inventory
Belvedere	21	1	21
Corte Madera	13	1	13
Fairfax	9	3	3
Greenbrae	10	2	5
Kentfield	16	4	4
Larkspur	14	2	7
Mill Valley	66	16	4
Novato	101	25	4
Ross	14	2	7
San Anselmo	24	7	3.5
San Rafael	96	22	44
Sausalito	28	1	28
Tiburon	41	2	20.5

]]> http://marinrealtygroup.com/insight-to-marin-real-estate/housing-inventory-vs-sales/feed/ 0 http://marinrealtygroup.com/insight-to-marin-real-estate/2009-marin-county-single-family-home-sales/ http://marinrealtygroup.com/insight-to-marin-real-estate/2009-marin-county-single-family-home-sales/#comments Mon, 11 Jan 2010 19:36:22 +0000 Lou http://www.marinrealtygroup.com/?p=654

# Single Family

Average List

Average Sold

Average Square

Homes Sold

Price

Price

Foot Price

All of Marin County

1,659

$1,049,202

$996,524

$489.45

Town by Town:

Belvedere

23

3,575,636

3,165,455

928.83

Corte Madera

69

1,033,738

996,160

538.17

Fairfax

64

708,478

687,566

403.26

Greenbrae

43

1,145,495

1,116,351

508.36

Kentfield

38

2,102,943

2,001,442

693.26

Larkspur

48

1,213,507

1,157,416

562.95

Mill Valley

229

1,250,706

1,181,971

549.5

Novato

424

655,858

637,278

296.68

Ross

35

2,359,516

2,245,380

748.71

San Anselmo

129

907,353

868,874

479.77

San Rafael

388

816,039

785,513

395.13

Sausalito

38

1,288,518

1,238,924

615.16

Stinson

11

1,607,857

1,433,464

821.94

Tiburon

67

2,458,018

2,229,467

719.88