Also, thousands of ARMS which were underwritten in 2006 are coming due to reset this spring/summer. A flood of new homes may come in the market in about a year, if the new payments cannot be made by the ownwer and the forclousre process kicks in. FYI 60% of purchases in the bay area in 2006 used a fancy, no down, ARM, subprime type loan.
Personally, if you can buy a house amidst the current market, you've probably got a pretty substantial down payment and could ride out a further 5-7% dip in the market.
According to report http://www.contracostatimes.com/realestatenews/ci_8570861?nc US foreclosure rate last month is 1 in every 557 homes; CA is much worse, 1 in every 242 homes.
Even only 10% of those not current with mortgage fall into foreclosure is still way above CA level, not to say US average.
AJ, what is the source of your data?
Honestly I do see more inventory coming on the market for various reasons.
1. Sellers are waiting for the buyers to come out for the warm weather but more importantly to find schools for their children and San Ramon has the schools.
2. Our market was flooded at the end of the year, Sept-Oct-Nov and people began pulling unsold property off of the market for the holidays and waiting for the end of Spring to early summer.
3. The foreclosure REO market is causing many people who were sitting on the fence about selling to jump into the mix and sell now.
All that being said I do think that now is a good time to start looking, there are huge deals to be had and as a buyer you get the pick of the litter and on your terms. A recent statistic came out amongst all of the foreclosure short sale fears, in our area of Contra Costa it is said that although foreclosures are out there, in our pocket 92.7% of homeowners are current with their mortgages. Now if we lived out in Discovery Bay, Pittsburg, Brentwood or areas of the such it would be a different story but San Ramon, Danville, Alamo, Diablo is a wonderful pocket with great schools, community and strong infrastructure. I just finished negotiating a deal on a house in Windemere loaded with over $110K in options and we got our price per sq ft down to $259 with the options thrown in! It is a good place to be because the new sales in Windemere and Gale Ranch are fighting to undercut the resales that are trying to keep up with the new. Some of the best deals that I am seeing now are. New builds, Resales in areas such as Twin Creek and Greenbrook and the REO sales that are popping up in multiple locations. The only time to accurately predit the bottom of a market is after things start to turn around, and once it does we are no longer at the bottom. You can see the action going on right now by just running around on the weekend especially to the builders, right now inventory is flying off the shelves, I have been out for 3 weeks in a row and it is the busiest it has been in a long time. I would be happy to help you begin your search, even if it is with a cautious approach, just contact me directly at firstname.lastname@example.org or 925.819.2747.
Have a good evening,