As 2009 draws to a close – you’ll soon be reading lots of top 10 lists for the movers, shakers, and trends of the year and the decade! In the spirit of being just a little ahead of the crowd, here’s our list of the top Silicon Valley Real Estate trends of 2009:
1. Low Interest Rates – with More Strings – Interest rates have been low this year, with periodic dips into historic record ”low” territory. These great rates, though, come with seemingly ever-changing requirements and conditions. Selecting a great financing source who can get you great rates AND help you navigate through the process has never been more important.
2. We’ve Got to Keep It Together For Longer – With the changing lending guidelines, it’s been taking longer for properties to close escrow and having a signed purchase contract did not automatically mean a closed escrow in 2009. Having a black belt negotiator on your real estate team has been critical this year.
3. “Turn Key” is Hotter than Ever – A few years ago – buyers could purchase a property & count on some quick appreciation to pay for a remodel in just a little time. Now – buyers can’t count on home appreciation to finance a remodel in the near term & are looking for great condition, move-in ready homes to buy (as if location and condition ever go out of style in the world of real estate!). On the other hand – for buyers seeking to purchase a property in a high-demand area like Palo Alto or Cupertino – it may pay to look for properties needing some work. If you can see the potential in a fixer – you may have fewer competing bids from other potential buyers.
4. Buying a Silicon Valley Foreclosure is not as Easy As It Sounds - Some of the busiest agents in any real estate office are the ones listing “Real Estate Owned” or REO properties for the banks. Buying one of these properties means navigating a maze of bank-specific requirements for making the offer, competing against multiple offers (some properties are getting 20, 30 or even 50 offers), and positioning your offer against “all cash” investors. Finding a deal & making sure it stays a “good deal” through the process is not for the faint-of-heart!
5. No Shortage of Short Sales – over the course of 2009 – we continued to see properties listed for less than what is owed to the lender(s) – resulting in a short sale requiring lender(s) approval to go through. We’re starting to see short sale listings where the lender has approved a short listing price – allowing the whole process to go smoother and quicker.
6. The Year of the First-Time Buyer – with more affordable home prices, the First Time Home Buyer Tax Credit, and sweet interest rates – many of the homes sold in 2009 went to first time home buyers. In the final months of the year – we are starting to see more and more “move up” buyers rousing the mid and higher-end price points. Welcome! Please bring friends! This is a trend we want to see continue & grow in 2010!
7. Deal Hunting in Palo Alto – Where’s the deal on a single family home in Palo Alto for less than $300,000? The media in 2009 did a fantastic job of painting the picture of real estate in free fall, and we went through a period in the spring where every day brought Internet inquiries looking for the extraordinary deal in Palo Alto. According to the MLS – the least expensive Palo Alto single family home sold so far in 2009 went for $703,000 for a 67 year old, 703 square foot cottage with foundation issues.
8. Your Home May Have a Bigger Electronic Footprint than You Do - Social media sites like Facebook and Twitter are 2009 Trendsetters above and beyond the world of buying and selling dirt. In real estate, though, the savvy home seller now ensures that their Real Estate agent is marketing their property through multiple Internet channels. Wouldn’t you want 30 million visitors at your open house – especially the ones who can’t leave foot prints on your new carpet?
9. Welcome to California! – We are working with an increasing number of clients who are relocating to Silicon Valley for a new job. It looks like both our job market and our real estate market are picking up! Welcome!
10. Less to Pick From, More Competition – And finally, in many areas of Silicon Valley – we are seeing fewer homes on the market. In fact, for Silicon Valley overall – more homes are “pending sale” than are actively for sale. For buyers – this means that there are fewer homes to consider and more competition to get your offer accepted. For sellers – it means that there are fewer competing properties. This sets the stage for an even brighter 2010!
We wish you the best holiday season & look forward to serving you and your referrals in 2010!