It has been a difficult year for Marin real estate. Total unit sales are off 35% for homes, and 38% for condominiums. Condominium average sale price is down 10%. Some realtors are learning new phrases, like “Did you say one or two shots of espresso in that latte?”

We see stability creeping in, however.

First, the percent of homes in contract has consistently stayed at the 23% level for two months now. That’s almost a normal market, and that number is staying consistent even though inventory is higher than it has been in years.

Second, Novato and San Rafael are two of the strongest markets in Marin County right now, with 27% and 24% of homes in contract. That’s important because these were the first two markets to really start to have problems when the market started to decline. It’s also important because combined, these two towns represent half the inventory in Marin County.

Why the strength here? According to agents who specialize in the area, Novato sellers are adjusting expectations, and pricing accordingly. In other words, they’re further along the learning curve, and adapting to the changing market.

Finally, we’re feeling an upsurge in buyer activity. We’re suddenly getting lots of calls asking about our listings, after a very quiet May. Maybe it’s just that school is out, maybe it’s a blip, but it’s fun anyway!

As always, call if you would like to receive our weekly updated market statistics.

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Someone forgot tell home buyers in Corte Madera. Real estate sales have picked up quite a bit here. For example, 247 Sausalito, asking $799,000:

Four offers, after 10 days, according to the Selling agent. Now in contract.

And 438 Oakdale, also Corte Madera, $850,000:

Four offers, five days, now in contract.

And 4 Wildflower Court? Asking $1,089,000.

Four days, two offers, now in in contract.

And then 215 Chapman just closed at $875,000 - there were five offers on that, asking was $799,000!

What’s going on?

First, they were all well-priced. Second, three were in Chapman Park, one in Madera del Presidio, both highly desirable neighborhoods in town. Finally smart buyers know that this is a good time to buy - we haven’t had a market this good for buyers in a very long time.

Combine that with some realism on the part of Sellers - and you get action. More about some great deals coming soon….

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The news is not good. But it’s not nearly as bad as the headlines.

First, some perspective. There were 40 foreclosures in Marin in the fourth quarter, according to the IJ. There were also 486 sales, according to MLS. In Contra Costa, for the same time frame, there were 1,558 foreclosures, and 1,559 homes sold, according to the Chronicle article. In other words, there were as many foreclosures as there were homes sold.

So for openers, Marin County is much better than other parts of the state. Of course, if the patient is near death, that may not be saying much.

But in absolute terms, the number is small. Will it increase? Probably. Mortgages are going to continue to re-set through this year, and that is going to create more foreclosures.

I don’t want to make light of this. In my last post I talked about low offers, and said in one case I would have counseled the Seller to counter back way over asking price. (That’s one way to find out people are reading your blog by the way, lots of feedback on that). Foreclosures create massive pain, emotional and financial, for everyone.

But it’s not a panic situation in the least. In fact, homes are selling, on average, at slightly over 96% of list price. Is pricing lower? In many markets, yes.  But are Sellers jumping on offers at 80% of list price? Not from what we’ve seen among our listings and buyers, and not according to the MLS data.

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Buyers have a right to offer whatever they want. Sellers have a right to sell for whatever they want. And bottom line, property is only worth what someone is willing to pay for it.

But the reality is that very, very few of these offers, to my knowledge, really come to fruition. As the person making the offer usually says, you never know - and they may be right. Perhaps the Seller will take an offer 20% off the list price. And as a listing agent, I always encourage the offer - because you never know, if the buyer gets the counter offer, they may well sign it, and getting a dialogue going is the first step to a sale.

I just checked the ratio of sale price to list price for a number of Marin markets, and the story is almost exactly the same. This ratio measures how much of a discount property actually sells for - so if it is 90%, that means on average, property sells for 90% of the asking price.

In Mill Valley, for the last six months, the numbers are all in the 96% range. In Greenbrae, homes have been selling for 96% to 98% of list price. In Corte Madera and Larkspur, homes are selling for 96% to 97% of list. And in Novato - the toughest market in Marin all year - average sale price is 96% to 97% of list price.

So the vast majority of the low offers don’t go through. The reason, as noted in an earlier post,  is that when properties are overpriced (and plenty of them are!),  the typical pattern is that there is a series of price reductions. When the home hits the magic number, boom - off it goes, sometimes with multiple offers.

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At Pacific Trail Townhomes , we are very careful to explain these are not condos. However, living in this development is very similar to living in a condo.

For openers, it looks like a condo - two buildings, multi-units, nicely landscaped and cared for, unlike most apartment buildings. Every unit gets it’s own parking space and storage unit, just like a condo. There’s common areas that everyone can use, like a condo.

And probably most similar to a condo, there is a TIC agreement that creates a Homowner’s Association, just like in a condo. This one is very heavily regulated by the state, and is therefore pretty conservative - something we haven’t always seen in Marin County Homeowner’s Associations. The funding for reserves is very strong, and now that it is up and running, the reserve fund will probably build quickly.

Each unit is individually financed, and you are free to buy, remodel, and sell when you want to - just like in  a Condo.

There are more similarities than differences, so the overall experience is, we believe, like living in a condo.

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These are 1bd/1ba, with large private patios, and most are townhouse-style two-story units.  Read more about them in the Marin Independent Journal here.

The price is terrific: units began at $250,000, and the most expensive one right now is $315,000. That gets you 545
square feet, newly remodeled with hardwood floors, granite slab counters, stainless steel appliances, recessed lighting, and lots of other details you wouldn’t expect in a unit that cost twice this much.

Located just off Shoreline Highway in MIll Valley, the complex is quiet, with lots of trees, yet is still 10 minutes from the Golden Gate Bridge.

The closest Mill Valley comp I can find right now is a 1bd/1ba condo in Shelter Ridge, for $425,000.

The first sale closed last week. Three more will be on MLS within the next couple days. Call for more information - this is the best deal in Southern Marin, and a great chance for first time buyers to stop paying rent.

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Fear of Loss.

This house in Larkspur, on the lagoon, has been going through the normal sales cycle in Marin right now.

It’s been on a little over 100 days, and had a couple of price reductions. It went into contract recently with two offers.

This has been happening quite a bit lately. It also happened on a fourplex on Mission in San Rafael this week.

What happens is that buyers wait and watch, wondering if the price will fall, but they still really want the property. Suddenly, someone else decides they want it. They have to have it also - either they really do want it, or the fact that now someone else does also makes it more desirable.

Boom. Multiple offers, even after 100 days on market.

Remember, if you’re watching a property, you may not be alone…….

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Currently, percent in contract is 15%. That’s up slightly from last week when it was at 14%.

We are getting the sense that it bottomed out. Besides the rise in the stats, we also had vastly increased traffic at our open houses last weekend. In our sales office, activity has picked up a lot in the last seven days. (We work in the largest office in the county, so while not a perfect statistical sample, it is often on target).

And there are other stories. We strongly considered a house in San Anselmo for a client, 124 Woodland. It went into contract with eight offers!

It’s a great lot, great location, and that story holds true throughout the Southern and Central parts of Marin.

As of 9/14, when we pulled stats by town, Corte Madera and Mill Valley continue to be the strongest markets in Marin County. Both were at 23% in contract, so they are technically buyer’s market’s also.

Novato is a tough place to sell a house right now, as 10% are in contract.

This is a great opportunity to be looking. Deals are out there, everywhere, at all price levels, as the numbers are about the same for all price ranges.

As always, for more detailed information, please feel free to contact me.

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Simple - Seller Financing.

This is a great house, incredibly charming, great yard, and an easy walk to the Ross School.

The seller is willing to finance, for five years, at the same rate as the conforming loan. It works like this.

Sale Price: $1,199,000

20% Down: $239,800

Conforming Loan: $417,000

Seller Financed Second: $542,200

The Seller will offer the rate at the same rate as the conforming loan, for five years. Right now that’s around 6 3/8%. With jumbo mortgages at 7.5%, that’s a huge savings on your monthly payment!

The kitchen has been beautifully remodeled.

This is a great home for a small family that really wants the Ross School, considered by many one of the best in the State of California.

For more pictures, go to our website, Or feel free to call for an appointment!

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I really, really, REALLY wish I could say that mortgage rates will come down immediately, but I doubt it.

Mortgages are usually  a function of the 10-year treasury note.  What has happened recently, however, is that the spread - the difference between the 10 year note and mortgage rates - has increased dramatically, as buyers of mortgages are now asking for a higher risk premium. The Fed cut won’t necessarily affect the 10 year rate, at least in the short term.

So what can we expect?

Hopefully, an increase in consumer confidence, for one thing. People like to hear about interest rates going down, not up, and that makes them more confident about buying things, like homes.

Realistically, it will also put a little more money in people’s pockets. The rate affects credit  card interest, and home equity loan interest, and those will become cheaper for many people, so monthly payments will get a little easier.

Finally, it will also put a little more liquidity, i.e. money - into the financial system, which will eventually affect the amount of money available for loans.

None of these changes will happen overnight, but this is hopefully the start of a trend that will continue to put money into the system, and make credit a little easier for homeowners.

Today’s Buyers Market will eventually shift back to neutral, the question is just when?

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