Tuesday, December 30, 2008

Thank You!

As we wind down 2008, I just wanted to offer a sincere thanks to those I've had the priviledge to serve this year. You have referred me to your friends, family memebers, and business associates and for that I am very grateful. Repeat and referred clients make up 95-100% of my business and I thank you for putting your trust in me. By you doing that, I am able to focus on providing outstanding service and I don't have to cold call like all the other Realtors. That way, I can do an even better job serving you and those you refer to me. Your business and trust is something that I will never take for granted. Wishing you and your families a FINE 2009! And, oh by the way, I'm never too busy for your referrals.

Friday, December 26, 2008

How to Get a Good Interest Rate

As we've seen the pastr couple of weeks, interest dropped to as low as 4.5% for a conforming, 30 year fixed rate loan which is outstanding. But after a few days, the rates went up. What happened? This is a fairly common phenominon where the banks get flooded with requests for refinancing and can't keep up with demand. So they raise rates in the short term to choke off the demand for new loans. What do the smart people do? They meet with their mortgage lender and get all the paperwork set up now (applications, verifications of employment, etc.). Most people wait until rates come back down again. But when rates drop again, the demand shoots through the roof and the cycle repeats itself. Be smart, set your paperwork up now and have your trusted loan professional give you a call when rates hit your target mark. Need a trusted loan professional? I know a couple of great ones. Contact me and I'll be happy to refer you to one. I make no money on it, but I believe that good deeds do come back to you.

Monday, December 22, 2008

Choosing Your Lender on a Bank Owned Home

Yesterday I was showing a very nice bank owned property to clients who decided to have me write an offer for them. But before the bank would review their offer, they required that the buyers get preapproved by them first. Even though the buyers were already preapproved by another lender, it still was a requirement. A bank cannot require that you use a specific lender to actually purchase the home, but they can (and often do) require that you get preapproved with them first. They do that to ensure they 1) are dealing with a credible buyer and 2) are given an opportunity to get your loan business. So who should you have do the loan? Having been involved in a several of these in the past, I would suggest that you keep an outside lender as your primary source. That way you still have an independent source looking out for your best interest. Remember, when you have the Bank Owned lender do your loan, you are really working with the seller.

Monday, December 15, 2008

Is it a Seller's or Buyer's Market? (Don't be Fooled)

First, let's define each. An equalibrium market in real estate is when there is 6 months worth of homes on the market. That means if no additional homes were put on the market, it would take 6 months to sell the existing inventory. When there is more than 6 months worth of inventory it is considered a Buyer's market because there is more to choose from. When there's less than 6 months of inventory it's considered a seller's market because with fewer choices, sellers can command premium prices. So where are we today in Santa Clara County? It varies by area, but as a whole we only have 6.5 months of inventory on the market (present inventory is 5,267 homes with an average of 878 homes per month selling). In Santa Clara County, we're not used to anything but a seller's market so it may not feel like an equilibrium, but this is what it looks like.

Thursday, December 11, 2008

Insider's Market Update

Here's an update from deep inside the real estate community. I just returned from an event in Arizona where many of the top agents from around the country meet to share information about their local markets. According to agents in San Diego, they are experiencing multiple offers on lower priced homes and home buyers are having difficulty getting their offers accepted. In many parts of Texas, the market is holding strong. Florida still has its challenges. Prices in Arizona have come down by about 35%, but rents are very strong there so investors have some opportunities for good cash flow. The forecast is that we will be out of the recession by mid 2009, but it won't be reported until the end of 2009. According to mutiple sources, there is $11 Trillion (that's right, TRILLION) sitting on the sidelines after being pulled out of the stock market. It's earning next to nothing for its owners. That money will go somewhere. Today, real estate is still on sale with some of the lowest rates in history. The smart money is getting in before the next run up.

Wednesday, November 26, 2008


Interest rates had a significant drop today. I'm hearing from my loan advisors that you can obtain a 30 year conforming fixed rate for 5.375%! That's a huge drop, about .5%. Happy house hunting (or refinancing).

Monday, November 24, 2008

Gilroy SFR Snatched Up This Week-End

I've been sharing with my clients (and on my website) that we had a very clean home for sale on a quiet street in Gilroy. It was a 3 bed/2 bath home on a 7,000 sq. ft. lot listed at $299,900. An excellent deal that was available with a Free Appraisal, 100% financing and Free PMI (Mortgage Insurance). This week-end, some lucky buyer snatched it up!

Wednesday, November 19, 2008

Good Time to Trade Up?

If you're thinking of trading up to a better home in a nicer area, it's better to do it in a down market. Why? Take this example. Your home last year was worth $600,000 and you wanted to buy a $900,000 home. That's a $300,000 increase in mortgage (or cash down). If your home dropped 10%, your home is now worth $540,000, but the home you wanted to buy is worth $810,000. That's a difference of $270,000. It's actually $30,000 cheaper to make that move now than it was a year ago. And the "hidden" benefit is that your property taxes will be cheaper on your new home if you were to buy it now. And that's savings you'll keep year after year!

Monday, November 17, 2008

100% Financing Here Again, Really!

Because of our relationship with Fannie Mae, our office is presently offering several Fannie Mae owned properties for sale. There's only only a handful of them in Santa Clara County, but most have "Express Path" financing. That means that if you want to buy a home and live in it, you can get in with no down payment. In addition, your APPRAISAL is FREE. Today when you buy a home and put less than 20% down, there is an additional closing cost and monthly fee for Private Mortgage Insurance (PMI). But with these properties, the PMI is FREE. I've tried to advertise this on Craigslist, but they keep flagging me and deleting my ads. I assume it's because no one believes it's possible to get 100% financing in this market. But it's true! Please contact me for a FREE list of these homes at (408) 247-4029.

Thursday, November 13, 2008

High End Real Estate Slowing?

Today, I was looking at a small cluster of custom homes in Los Gatos. Each had a minimum 2.5 acre lot. It's my understanding that these homes have been on the market for over 2 years and are priced in the $3-4 million range. They're certainly gorgeous with superior construction and amenities. But they don't seem to be selling. Why? It comes down to one of three things. One: they were overpriced to begin with. Two: the agents representing the sellers haven't been effectively marketing the property. Three: the values have declined and the sellers are not motivated to sell them at the "real" market value. What I do know based on factual evidence is that the median price of homes in Los Gatos dropped 15% from $1,550,000 to $1,315,000 in the last 12 months and the number of days it took to sell a home increased by 43% (from 51 to 73 days). While Los Gatos has dropped in value, areas like Palo Alto and Saratoga have seen little change in pricing... yet. Both areas are showing a drop in the number of homes sold by 13% from a year ago. -Gary

Monday, November 10, 2008

Loan Limits Changing.

My trusted loan advisors have been giving me the inside scoop on upcoming changes to basic loan programs. Today, there are 3 basic loan groupings: Conforming (loans under $419k), Jumbo-Conforming ($419K-$729K) and Jumbo (over $729K). All things being equal, Conforming loans have the least expensive rates and Jumbo's are the priciest. At the end of this year however, there will only be 2 loan programs, Conforming (under $625k) and Jumbo (over $625K). If you have a loan you need to refinance that falls in the $625-$729k range, my lenders are saying you should do that now before you get stuck with Jumbo rates. For more information, please go to the "Referral Directory" link on my website and look under "Lenders" to talk to some great people whom I trust to help you. But do it quickly, lenders will be shutting down their pipeline for this loan type in December!

Friday, November 7, 2008

Bank Owned Homes are Hot This Week!

In our office this our week, 7 of our Bank Owned homes have sold! Some of these have been on the market for quite a while. It may be a signal that the pendulum is beginning to swing in the other direction. :^) To see for yourself, go the "Investors' Corner" tab on my website http://www.garynobile.com/

San Jose, Santa Clara County real estate.

Thursday, November 6, 2008

Real Estate Short Sale vs. Foreclosure

In Santa Clara county (San Jose area) 69% of the homes being sold today are either Short Sales or Foreclosure properties. Huge numbers, but what's a Short Sale?
Here’s an example. Two years ago, a couple bought a home for $600,000. They put down $60,000 and had a $540,000 mortgage. Today they are barely able to keep up the payments and have to sell the home. Frankly, most people in this category weren't qualified to buy the home to begin with but were able to get a loan anyway. Today, that home is worth $400,000. They don’t have the money to make up the difference. Therefore, the bank must approve the sale and take a loss. In other words, they are “short” when they sell the home. The next phase is when the homeowners stop making the payments and are eventually foreclosed upon. Then it becomes a Foreclosure property. There are three ways to describe a Foreclosure property but don't be confused, they all mean the same thing. ("REO", Bank Owned, and Foreclosures). "REO" stands for the way a bank categorizes it's Foreclosures and refers to "Real Estate Owned". There's some outstanding opportunities for investors and first time home buyers in this market. More on that tomorrow...

Wednesday, November 5, 2008

New Hope

Weather you're a republican or democrat, I hope you're encouraged by our new president's approach to solving the many problems our country is facing today. After an historical election, I'm feeling hopeful again about our country. I must admit, I was even inspired by his speach. It's my hope and prayer that Americans as a group unite to work together, instead of apart. That we become more self reliant, and less looking for bailouts. That we show compassion, as well as toughness. That the mortgage world on Wall Street has learned its lesson, and doesn't repeat it's mistakes. Yes, I'm hopeful, and I hope you are too. We need to work together to right this ship.