Most San Jose neighborhood values will continue to perform well in 2011 and into 2012 even with the recent negative news about Bank of America unleashing a slew of new foreclosures into California in the coming months.
Foreclosure levels will remain the same in 2012
That’s a pretty bold statement on my behalf but having just retuned from a national foreclosure convention I stand in pretty good company including the likes of Freddy Mac economists and various other national asset diposition companies who are all waiting for the foreclosure activity to increase.
The challenge over the last year has been the slow and methodical process of making sure banks are staying within the legal boundaries of the foreclosure process all brought on by the ROBO signing lawsuits. As a result the anticipated levels of foreclosiure activites are expected to stay at current levels through 2012.
What does this mean for San Jose Neighborhoods?
Neighborhoods like Willow Glen, Rose Garden, Almaden Valley, and Santana Row to name a few should continue to maintained their values while Downtown, Central San Jose, South San Jose, and the east valley will feel the affects of foreclosure activity.
Should I wait for the market to turn?
Experts at the foreclosure convention are now saying that we will continue to see the current real estate market through 2016. You have plenty of time to buy before the market sees a significant change and until then buyers will continue to find opportunities in those neighborhoods affected by foreclosures.
May Foreclosure data didn’t show much of a difference other than the continued climb to a one year average from the time of a default to sale date. This trent continues to show evidence that foreclosure modification efforts and short sales are allowing homeowners more time to help them stay in their homes.
Foreclosure inventories stayed steady with little change to the amount of people who defaulted on their loans(green) and even less sale activity(blue). This is the first month that showed 0% activity in REO inventory levels(red).
Notice of sales increased(blue) while people who received a notice of default fell slightly(green).
Cancellations fell last month reducing the amount of foreclosure postponements for people currently in default(grey). Postponements(cancellations) are a good indicator of modification and short sale activity. The number of properties going back to the banks as a result of a sale increased slightly(red).
The average time a homeowner had before losing their home to foreclosure has continued its steady climb and is close to one year(green). Bank are taking an average of 200 days to sell properties(red).
Foreclosure Filings* have dropped over since February as shown by the Notice of Sale indicator down 32% from the previous year.
Foreclosure Outcomes* show cancellations are way up over the previous year possibly fueled by successful short sales. My own experience tells me that modifications made up a very small percentage of these cancellations. REO indicator also shows that properties are not going back to bank compared to the previous year again fueling my thought that properties are having success in short sale and modification attempts.
2011 Foreclosure Inventories* have stayed steady with a steady drop in scheduled sale dates possibly fueled by modifications or short sales.
Foreclosure Timeframes*
The interesting fact about this chart is how many months it’s taking for a bank to foreclose compared to the previous year there are clear signs that banks are moving though the foreclosure process much faster 5.97% compared to 21.66% from the previous year.
*Foreclosureradar.com
The California Association of REALTORS® have released the affordability numbers for the state of California and among them is the very expensive bay area and Santa Clara County is among them. Here is what they found.
- In Santa Clara County only 37% of the population can afford to buy a home at the $545,000 median range.
- The required take home to purchase is $117,630.
- Your monthly payment will be around $2,940.
The Chart below shows the cost of home ownership in California.
Check out my video update for the Santana Row area neighborhoods. Find out how long it takes to sell a home in these neighborhoods and what the market is telling us about the recent sales.
Sold Data*
(See Video update)
Available Properties Data*
Total Avilable Properties: 104
Total Available Days on Market: 93
Average List Price: $647,847
Accepted Offers (Pending Properties)*
Total Accepted Offers(in contract): 87
Average Days on Market: 67
Average List price for accepted offers: $499,633
Median List price for Available and Accepted offers: $574,800*
* Source: mlslistings.com
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