Fucillo Family Weblog

In a recent Forbes magazine article (www.forbes.com) the City of San Jose California was rated best city for home sellers. According to the article:

…tough regulatory measures make it difficult to overbuild. New home construction dropped 63% last year, while jobs grew by 1.2%. Home vacancies, which were already low at 1.6%, fell to a national bottom at 0.8%, helping make San Jose one of the country’s tightest markets.

 This reaffirms the feeling that some real estate professionals, including myself, have been feeling for a while. That San Jose and the greater Silicon Valley Real Estate is still a wise investment for most people. Although we are seeing some specific neighborhoods effected by large amounts of foreclosures and short sales, we see others that are holding strong with sales increases and multiple offer situations. All real estate is very local, and each neighborhood or area has it’s plus and minuses, but it’s nice to know that overall San Jose is faring quite well.

I ran the numbers for downtown San Jose (including the Rose Garden & Naglee Park neighborhoods) for February and found some interesting info.

Let’s start with inventory numbers. Inventory is up 82% in Downtown San Jose. Quite a big jump really. Sales were down 56% over this time last year. What does all this mean? Well, seasonally we see an increase of inventory build up starting in spring and peak during the summer months. But the sales numbers are interesting, they’ve been pretty flat the last three months (16 in Feb., 19 in Jan, & 15 in Dec.) we’ll have to watch the numbers next month to see if trends start to appear. From a buyer’s perspective there are a lot of houses to choose from, and seller’s are willing to negotiate. We’ve finally seen some decent homes priced in the $400,000 for the first time in a couple of years.

Interestingly sales prices keep ticking up. Traditionally we see a pretty clear bell curve for sales price, with the peak hitting during the summer months. But with this much inventory we’ll have to wait and see how that effects home prices. Especially since we only had 16 sales in February and numbers may have been effected by the big sale of $2,486,000 on Hanchett Ave. Also of note, we had 6 houses sell below $500,000.

Days on Market went up significantly this month over last year as well. It’s showing the upward trend that we’ve been watching the last few years. Though the numbers could have been effected by the 3 houses that sold in February with over 200 days on market.

questions? comments?  want the full report? contact me at jamesf@remax.net

Last Monday and Tuesday I spent two days in Seattle attending the Buffini & Company Turning Point Retreat. The head of the company Brian Buffini is an amazing speaker and I walked away from the event not only pumped up about real estate but inspired in many aspects of my life.
Brian discussed how right now is one of the most exciting times to be a real estate professional. With the longer listing times, increased inventory on the market, and negative press, most people think Realtors are out holding signs that say “I’ll sell your house for food”. However, now more than ever, we provide a service that can amount to a huge win for our clients. The agents role in the process is more important than ever. Being more than an agent…a resource, a friend, and a “hub” of information will set a professional full time agent far above the rest.

One of the biggest “ah-ha” moments for me was on the discussion of finances. Maybe because we are going through our financial plan now, or because I was just ready to hear it but the idea of saving, planning for the future and investing for future sources of income really hit home with me. It got me started on a path to dig a little deeper and I’ve already started the reading. (more on that later)

The most enjoyable part of the weekend though was the mixer on the first evening were I got to meet some really great people from all around the Pacific Northwest. I really had a great time and can’t wait for the Master Mind event in San Diego in August.

 Just when you thought some relief may be on the horizon for that new home you’re thinking about purchasing, due to the adjusted conforming loan limits  of to close to $750,00, you read this.

 This was e-mailed to me from a friend:

Stimulus plan may lead to higher mortgage rates

NEW YORK (Reuters) - A key element of the stimulus package aimed at jump-starting the ailing U.S. housing market may have the unintended consequence of raising mortgage rates, said analysts studying the plan.

A federal proposal to increase the size limit on loans eligible for purchase by mortgage finance giants Fannie Mae and Freddie Mac has unsettled traders in the $4.5 trillion market for bonds backed by the “conforming” mortgages.

Increasing the eligible loans to $729,750 from $417,000 would change the characteristics of mortgage-backed securities, leading traders to exact a premium for increased interest-rate risk.

Borrowers with large, jumbo loans are more likely to refinance since their savings are greater for each incremental drop in rates than for a smaller loan. The loans will taint the bonds since traders don’t initially know the make-up of the securities known as “agency” MBS.

Higher mortgage rates would make it even harder to unload already high housing inventories and existing homes on the market, delaying any housing recovery and potentially extending the U.S. economic slowdown….

*email me for the entire article.

Interesting. We’ll have to see if this holds true. If it does, I’m interested to see how it will effect the different markets in our area (1st time home buyers at about $550,000 vs move up buyers at $750,000-$1,000,000.)

Quite a few people have asked me recently about the Economic Stimulus Package bouncing around Capitol Hill. The most important aspect of the package being “how will it effect the housing market, and more importantly, my ability to buy a home”. 

The answer is a little gray right now, but it could be very important. Both the House and the Senate agree that we need to raise the limits on the maximum size mortgages our government will insure (FannieMae & FredieMac).

Why is this a big deal? Because in California and more specifically the Silicon Valley the average price of a home is well over $500,000 (closer to $750,000 in some areas).  Quite a bit more than the $417,000 than our government will currently buy.

Under the  proposed stimulus plan, the maximum mortgages for  the government programs will jump to 125 percent of a local area’s median house price-with a top limit just under $730,000.

That’s huge. How will this play out? Will it help the current housing market? We’ll just have to wait and see.

We finally have pictures of the Client party on Tuesday November 11th.

On November 13th, we had our first client appreciation party. It was held at Good Tastes in Campbell, CA. (http://www.goodtastes-wineshop.com/) and went very well. Everyone had a great time and are looking forward to doing it again soon. Pictures to follow shortly.

I think we’ve been pondering the idea of replacing our front door since the day we moved into this place. If you live in an old house you know there is no such thing as Low Maintenance. Because our front door faces the west, it gets beat with late afternoon sun, which has caused cracking and a constant need for painting.

Last weekend we went to Viking door in san jose (www.vikingdoor.com) because they were having a parking lot sale. We found some great finds, but of course got upsold on a NEW door.  But here’s the issue…apparently, according to my friends, I’ve become quite a “house snob” and am quite opinionated about details of homes. My gut tells me that a proper wood door is the RIGHT door for our home. Not that we have the perfect example of a california bungalow but it just feels right. But there is something to be said about a fiberglass door that never needs paint or upkeep and has a lifetime warranty. I know what your thinking “fiberglass?” You’re envisioning some awful white front door with rediculous floral leaded glass ala Home Depot. But when you see it you might change your mind…I know I did. I’m still having an internal struggle for sure but I may be leaning toward the fiberglass door. Am I crazy. What do you think?

Imagine it without the stained glass. I think it’s a pretty nice door. And of course my real estate mind is kicking in with “…upgrading your front door is the single most effective thing you can do to improve curb appeal…” Maybe I watch too much HGTV.

The Fucillo Family recently purchased a Condo in San Luis Obispo as a rental investment. I think it’s a great place. Something I would have been really happy to live in while I was at CalPoly. Only three blocks from downtown and a quick bike ride to school. It made me a little nostalgic for my school days there. I love San Luis….now I just need to figure out how to make money there.