Market updates - the best local resource I've found

Case-Shiller... bah humbug. Dataquest... better than a sharp stick in the eye, but not by much. Talking heads on CNBC... please stop talking. So WHO can you listen to when trying to figure out what is going on in the LOCAL San Francisco real estate market? Well, the two best things to do are go to open houses and scrutinize the market for months, and you'll get to know it better than anyone. The 2nd is to turn to someone who does that for a living... a hard working Realtor. But if you just want data... a quick place to check in on the market once per month... Trulia's "heat map" with (and this is critically important) it's ZIP CODE box checked.

Zip codes aren't even as "local" as I'd prefer, but the map will show you the border outlines for each zip code, and then you can see the "year over year" or "y-o-y" difference in "Average Selling Price" and "Median Selling Price". Median is probably best - half sold for more, half sold for less, than the median. "Average" can be skewed by just one or two really high priced (or low) sales.

You can then sort by zip code, or by highest appreciation, or highest depreciation. A quick guide are the color codes - which change as you sort in different ways. And to see the what area is what zip code, just hover your mouse over the map.

The most unfortunate thing about Trulia's heat map is that I'm writing this at the end of December, and they only have July through September data. It shows zip codes 94118 (Laurel Village, Lake and Inner Richmond) as being up 9.9% year over year (surprised????) but as a San Francisco Realtor with "feet on the street" I know the market lost that entire 10% after the financial crisis became mainstream news.

But Case-SCHMiller is old data too and does not have San Francisco City only data... so I find it to be totally worthless, and Dataquest does do San Francisco only, but does not get any more local than that. And as the old adage says, real estate is local, especially San Francisco real estate.


Looking beyond the mortgage mess - a cement foundation

Buyers have bought homes this year (2008) for 17.8% lower than they did in 2007. More importantly, only 9.3% of them got a 2nd mortgage compared to 43.4% in 2006. ARM's and hybrid loans are down to 7.5% of all loan from 20.2% in 2007.

Finally, 35.9% of all buyers in 2008 were first time home buyers.

So what does all of the above mean? The cement is being poured into the foundation of the future housing market. A strong base is being built, and so unlike the house of cards from the 2004 to 2007 markets, the future housing market is likely to be quite strong and stable.
Interesting report from the California Association of Realtors (found here).

The naysayers, the doom and gloomers, all point to continuing mortgage problems like Option ARM recasts starting in 2009 through 2011. But the government has clearly demonstrated their commitment to supporting the housing market and saving as many homeowners as possible. Meanwhile sales are up 12% over last year... builders have stopped building new homes... and the U.S. still has population growth... so we'll have a housing shortage sooner rather than later.

Meanwhile, lending is still incredibly tight where the majority of buyers have to have 20% down, and often 30%.... and that can only ease over time... it won't get tighter. That will invite more and more first time home buyers, using record low interest rates, who will buy homes that are 30%, 40% and even 50% below their highs.

In the end, we will have a strong foundation upon which the new housing market is now being built... and those who purchase in 2009, 2010 and 2011 will look like real estate geniuses 5 years later.

Finally - since this is a City of San Francisco real estate blog... as the suffering California market stabilizes for all of the above reasons, and the stock market shows that it too has firm legs, the well off San Francisco buyers who are absolutely refusing to buy anything, at any price, will be back. And the drop of 10% in places like Noe Valley and Cow Hollow will be a 2008 blip. Anyone who believes San Francisco is in for a 30% or 40% drop simply because California or nearby Bay Area towns have had drops of that size, will soon find out that San Francisco is different.