Market Conditions in 95123>Question Details

Jo, Both Buyer and Seller in

HOw low would the California Bay area prices fall? I am talking about the Santa Clara, Alameda, Contra Costa

Asked by Jo, Wed Apr 16, 2008

areas....would they continue to fall or have they bottomed out?

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Jo, It's really hard to say. Some areas of Santa Clara are still booming and there are still multiple offers, whereas other areas have decreased as much as $100k or more in value. Contra Costa has really taken a hit. Prices have dropped to what they were about 4 years ago. Good luck.
1 vote Thank Flag Link Thu Apr 17, 2008
Take a look at the economic demographics in the area you are focusing on. If the demographics show an upper middle class income average, and a high percentage of people with college educations, and an older population, you will see minimal softening compared to other areas. There will be fewer short sales and even fewer bank owned properties. The up side of buying in those neighborhoods is the security of prices holding. You will find value prices in those areas, but just not deeply discounted properties. You can use this method as a guide. All the best. Liz
1 vote Thank Flag Link Thu Apr 17, 2008
Jo,

A very good question and there are many many answers to this questions. You need to look at specific neighborhoods in the above counties to get answers and they will be different for each neighborhood. You can approximate at the country level, but you definitely cannot put this counties together. There are some neighborhoods where the prices went up during the 2007 and the beginning of 2008.

Generalizing (what I promised not to do, but cannot resist the temptation!), we all see more buyers activity now and should improve through summer, but I don't think it is sustainable throughout the end of the year. Again - you need to look neighborhood by neighborhood.
Web Reference: http://www.cimpler.com
1 vote Thank Flag Link Wed Apr 16, 2008
ARTUR URBANS…, Real Estate Pro in Burlingame, CA
MVP'08
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Hello Jo, there are still a lot of short sales on the market that could end up in foreclosure. However, buying activity has increased in recent months so a lot of those homes priced favorable right now are receiving multiple offers. As long as the demand for housing stays high in our area (speaking only for Silicon Valley communities) prices should stabilize. I know that we certainly don't need any more inventory though, so I think a potential seller who doesn't really have a purpose or need to sell, they might want to wait. It's a great time to buy as long as you don't have to sell something in order to buy. However, for move-up buyers, if you sell for less than your neighbor did 2 years ago (but still have enough equity to make a profit) you may sell for a little less but have a great opportunity to make it up on the buying side. For instance, selling a condo or townhome in order to buy a single family home. There is a good article on that subject released today through the National Association of Realtors, here's the link: http://www.realtor.org/RMODaily.nsf/pages/News2008041601?Ope…
I don't know what your personal goals are as far as buying and selling but I hope this info helps.
Kind regards.
1 vote Thank Flag Link Wed Apr 16, 2008
Thats a very broad question, and it would take great speculation to answer it correctly. I will say that i have seen an increase in buyers and buyers able to qualify under new FHA Loan limits. This is helping to stabilize prices in some areas.

Maybe you can reply and get more specific on a certain area. So we can help you better.
0 votes Thank Flag Link Thu Apr 17, 2008
Jo,
The neighborhoods that are most vulnerable are the ones that had more 100% purchases, and are generally in the less affluent areas. In addition, the further out the homes are, the higher the chance of price decline, exacerbated by the rising gas prices. With that said, homes in the best neighborhoods such as Almaden, Los Gatos, Saratoga, Cupertino, have continued to hold their value very well.
I believe the falling prices will simply bring more differentiation between the different areas. Just look at the correlation between prices and school scores and general affluence of the area.
And we cannot accurately tell if things have bottomed out until they already have and things are moving up. The same thing happened in 2003, when the market stopped after we went to war with Iraq. The first half of the year was a great buying opportunity, and by September we started having multiple offers and that lasted 3 years! People will always have real estate needs, and many folks have simply pushed it off with the rash of bad economic news. But it will come back.
0 votes Thank Flag Link Thu Apr 17, 2008
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