http://www.trulia.com/voices/Market_Conditions/Current_Market_conditions_for_entry_level_housing_-105448I've been looking at the activity in various parts of Menlo Park, in particular Flood Park and the Willows over the last two years. One thing that stood out to me was that FP had a jump in properties listed in the 2nd half of 2008 with slight pricing discounts and now it has dried up to a trickle. Whereas the Willows experience was slightly different, few properties in 2008 clinging on to the pricing peak, but now since the end of the year we have seen more properties and some with substantial discounts to peak pricing. Anyone else seeing the same thing? What do you think this means when comparing these two particular neighborhoods? Is the Willows ahead of the curve or is Flood Park? Fair Oaks also seemed to follow Flood Park activity.en-ushttp://www.trulia.com/voices/profile/Real_Estate_Pro-Menlo_Park_CA-62370/http://www.trulia.com/voices/profile/Real_Estate_Pro-Menlo_Park_CA-62370/Jason good to see you are following the market. yes the pricing on lorelei is very attractive. i have sold 2 houses in epa and east menlo this year - both in the low $200,000 range. sales activity is high but i would say prices are still dropping. also many lenders have had a moratorium on foreclosures recently and i expect once this moratorium is lifted, more foreclosures will come to market. so i see downward pressure on prices in these areas for some time. i know everyone wants to time the market but honestly i do not believe it is possible. if there are no other factors other than financial, then i do not see any reason to buy right now - i mean if it is strictly a financial decision then i would say the cards still point to flat to slightly declining prices. of course interest rates are very attractive right now and i do not think this situation will last for more than another year or so. i suspect that once the economy turns, inflation will hit driving up both interest rates and property values. if are are interested in buying because you want to own, this i think is a good time. prices may still drop a little but with rates so low, buying now may make sense. say you are looking at a $600,000 house and for the sake of argument say $500,000 loan. every percent increase in interest rate costs the buyer $5000 more per year for a long term purchase that $5000 a year savings is going to keep adding up so that even if prices drop further you might be better off long-term buying now and getting a 4.75% 30 yr fixed loan. and again, no one can time the market. i was out with a client yesterday and the client said the market is like a compressed spring ready to unleash all that stored energy - everyone is waiting for the starting gun to go off. i believe it is an apt description - there is a lot of pent up demand - lots of people want to move - sell and buy or just buy. i think it will prove prudent to get out in front of that pent-up demand rather than waiting for the gun to go off. ArnWed, 01 Apr 2009 07:29:46 -0700http://www.trulia.com/voices/profile/Real_Estate_Pro-San_Mateo_CA-284492/http://www.trulia.com/voices/profile/Real_Estate_Pro-San_Mateo_CA-284492/Hey Jason, for your friends who are looking to buy, the best advice you can give them is that a recession is a terrible thing to waste. No funny business, and I'm sorry for the ones who have lost their job, and are not doing well. But, there has never been a better time to buy for the one who can afford it. Home values are down and rates are at record levels. That is the best combo you could ever hope for. Best, Dave Tap Tapper Realtor Cashin Company www.DavidTapper.com 650-403-6252Tue, 31 Mar 2009 23:00:04 -0700http://www.trulia.com/voices/profile/Other-Menlo_Park_CA-707195/http://www.trulia.com/voices/profile/Other-Menlo_Park_CA-707195/Thanks for answering Arn, if Flood Park/Fair Oaks is a leading indicator of what could happen then perhaps things won't be bad for entry-level Menlo Park properties in other neighborhoods. I would expect to see a drying up of the entry level properties. Although there is one really cheap fixer upper out there at 535K on Loreilei. In the Willows there were a few properties with "roll-back" pricing - the one on Walnut and the one on Oak these are liveable properties that appear to be in decent shape. Then there was the 261 on Marmona, but it showed up as being taken off MLS -- I suspect this is just to hide the transaction price. I currently live in Menlo Park, but have several friends that are looking to buy. Just trying to look ahead to see if we will be experiencing more pain. If there was a leading indicator out there... I'd love to know what it was. I guess the subprime areas could be used in some fashion as an indicator. They (East MP/EPA) have dropped percipitously, but what is the market action now in those neighborhoods? Are prices still dropping?Tue, 31 Mar 2009 15:43:45 -0700http://www.trulia.com/voices/profile/Real_Estate_Pro-Menlo_Park_CA-62370/http://www.trulia.com/voices/profile/Real_Estate_Pro-Menlo_Park_CA-62370/Jason Good analysis. I would say some buyers prefer the Willows as it is "closer" to "downtown and civic center" than Flood Park. All of the Flood Park properties are nearer than freeway than many in the Willows so that makes a difference. ArnTue, 31 Mar 2009 14:01:21 -0700