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First Quarter Multi-Family Sales Results

The State of San Francisco

Jay Greenberg reports on Q1 results for 5-9 unit and 10+ unit sector in a good article for the SFAA magazine. All in all it was encouraging in that multi-family sectors are certainly showing bullish signs after the housing bust. Sales are up, rental demand is strong and better pricing makes a compelling case for value.

5-9 Sector
This sector is now at the lowest price per sq. foot in five years. The price in 2007 was $296 and peaked in 2008 at $325. Q1 2011 is at $296 per sq ft. In 2007 the gross rent multiplier (GRM) was slightly better than 17. Q1 2011, we are looking at an average GRM of 12.09.

10+ sector
Price per sq ft in 20007 was $290. For Q1 2011 we are at $227. GRM in 2007 stood at 14.77. Today the average GRM is 11.22. Continue reading this post


Posted by: Howard Sobel on July 25th, 2011 under Guest Bloggers, HomeGain, Regional

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Home Buyers: The Next Ones Up

We are looking at the wave of 6 million new home buyers. Known as the Millennials, these are recent college grads. They are a new generation, more wired and more diverse than any before. Whats more, they don’t carry the negativity that recent home buyers/owners have acquired during this historic bust. We all know the bad news. The housing-market recession is ongoing, and still no indication of a sustained recovery. In fact we’re are a hair away from double dipping, only 1.1% above the April 2009 trough.

Despite all loss and fear of more loss keeping buyers in the wings, home ownership is still a destination. Seventy percent surveyed by a Wells Fargo study of more than 3,000 still want to own a home, positively responding to new rigorous rules of higher down payments and credit requirements. This is a group that is willing to buy.

The Millennials are the next ones up and seemingly a bit of a blank slate. They’re still positive about lenders and institutions and looking to own. They are a great opportunity for new beginnings. It will be our job to rebuild and create new impressions for the next ones up, so that they will be enthusiastic about home ownership. The expectation that a home is something to flip, rather than live in is gone. It’s a home, not a growth stock and they seem to know it.

Continue reading this post


Posted by: Howard Sobel on April 12th, 2011 under Realtor

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Thoughts From Around the Web Regarding the Case Shiller Report

As most of us know by know we are in for another bad year, even the optimists are pessimistic. It pretty clear that the latest index report shows a double dip. The Standard & Poor’s/Case-Shiller index fell in December from November in all 20 cities, except Washington, D.C . Nationally, home prices fell 4.1% during the last three months of 2010, compared top last year, according to the latest S&P/Case-Shiller home price index, down 1.9% compared with the past three months.

The big question is whether we are bouncing along a bottom or whether we have more to go. The following are some thoughts from around the web that highlight some of the current sentiments, both optimistic and pessimistic. I’ve also included one silver lining I have to share.

Robert Shiller
New York Times
Yale Economist and half of the Case Shiller Team

He is the author of “Irrational Exuberance and helped develop the S&P Case Shiller Home Price Index. Mr. Shiller said in a conference call that he saw a substantial risk of the market falling another 15, 20 or even 25 percent.

National Association Of Homebuilders

This is the worst year for new-home sales in 50 years. February remained unchanged for the fourth straight month at 16. Any reading below 50 indicates negative sentiment. The index hasn’t seen 50 or better since April 2006.

Continue reading this post


Posted by: Howard Sobel on March 10th, 2011 under Market Trends

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Apartment Sector: First One Out

This is the one real estate area that seems to be looking up. There is no question that apartments really scream when it comes to actual performance and renewed investment confidence, says Hessam Nadji, managing director of research and advisory services at Marcus & Millichap. The apartments sector is leading the recovery. Nationally, apartment vacancies declined 20 basis points during the first half to reach 7.8%, setting the stage for rent growth.

Demographics: The rental sector is the one area that that is looking like its in a recovery. Residential housing was t was over built and overbought, while rental properties barely kept up with the demographics. Harvard studies indicate that if you couple the under 30 age group to new immigrants and retirees looking to move back to the city for convenience, as a whole they are a potential renter pool larger than the the boomer generation. That is huge!

Supply: Over 4.3 million loans are 90 days or more delinquent or in foreclosure. Moreover, the shadow inventory of REO properties, as well as distressed mortgages facing foreclosure, will take nearly three years to clear at the current sales rate, according to an S&P report. S&P analysts concluded that \many servicers will likely shift from mortgage modification to loan liquidation. Hopefully, the banks will distribute supply onto the market with an eye to price stability or at least an orderly decline. With that in mind expect supply to continue to increase and prices to continue to decline.

Continue reading this post


Posted by: Howard Sobel on December 6th, 2010 under HomeGain Market Data

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Banks to Allow Local Groups to Buy Foreclosures

Following on the success of the First Look Program many larger banks are going to take a page from First Look. Banks will now allow local governments and non-profits the ability to buy foreclosed homes before they are sold to private investors.

The largest mortgage lenders in the country, including Bank of America Corp. and Wells Fargo have agreed to let the groups purchase the properties ahead of private investors. Neighborhood organizations will have up to 48 hours to evaluate bank owned property before professional investors get to view and bid for purchase.

The idea is to level the playing field and allow those who would be stakeholders in the community helping stabilize real estate markets. HUD thinks they can move 100,000 properties through this program.

The National Community Stabilization Trust will collect information on foreclosed properties and help local groups to identify which ones to purchase.

From The Website

The National Community Stabilization Trust facilitates the transfer of foreclosed and abandoned properties from financial institutions nationwide to local housing organizations to promote productive property reuse and neighborhood stability. In collaboration with state and local governments, the Stabilization Trust builds local capacity to effectively acquire, manage, rehab and sell foreclosed property to ensure homeownership and rental housing are available to low- and moderate-income families.


Posted by: Howard Sobel on October 3rd, 2010 under Short Sales and Foreclosures

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First Look Gives Home Buyers An Edge

First Look Program

Fannie levels the field

New Incentives
Fannie Mae markets its REO through its Properties. Under the new incentive program, owner occupants and public entities that buy a HomePath Property between now and December 31, can receive up to 3.5% of the purchase price in closing cost assistance. The sale must close within 60 days of acceptance of the offer and no later than December 31, 2010.  The incentive must be requested in the initial offer.

What Is It
Individuals and public entities are given a period of time, generally 15 days after a property is listed at (a Fannie Mae site). is the listing site for about 190,000 properties held by the GSEs. Individuals and public entities (read non-profits) have a lead time over investors to inspect  and submit an offer to purchase. After 15 days, the listing is open to all potential buyers.

The idea is to offer first to those who would live in the home and become stakeholders, adding stability to the community and to avoid  too quickly putting property back into a supply laden market. By offering a sneak preview to owners first, Fannie hopes to encourage home ownership without the edge professionals may have and avoid the pressures of bidding against professional investors.

Why Should I Care
Levels the playing field and it’s working.

Fannie has moved more than 29,000 homes out of its owned real estate portfolio of properties acquired by the  through foreclosure to owner occupants. Some 800 non-profits have also bought an additional 5,000 properties through First Look.


Posted by: Howard Sobel on September 29th, 2010 under Buying or Selling a Home

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