National & Regional Snap-shot: The election has come and gone and the national focus has returned to the economy, the credit crisis and the slumping housing market. The roller coaster ride continued with 30yr fixed mortgage rates rising from 6.07%* at the beginning of October to 6.47%* at month's end. No sooner than Paulson and Bernanke talked voters and Congress into the "mortgage bailout," it evolved (was switched) to a different plan of injecting money directly into banks and other financial institutions as opposed to buying mortgages through reverse auctions. Officially, $125 billion was given to the nations 9 largest banks with another $125 billion slated to be injected into smaller banks across the country. From a regional standpoint last month, 2,084 homes sold in Sacramento County, 1354 were bank owned (70%), 205 were short sales (10%) and the median home price rose 1% from $192k in September to $194k in October.
Folsom: Home sales rose from 49 in September to 64 in October. Compared to last month, sales increased by 31%, and when compared to October 2007, sales also increased by 31%. There were 21 bank owned home sales (33%) and 8 short sales (12.50%). The biggest change in Folsom was the number of short sales, which doubled from last month, suggesting the banks are making a bigger effort to sell homes prior to foreclosing. The average home price dropped from $439k last month to $422k in October. The total supply of homes rose from 259 on 10/1/08 to 284 on 11/1/08.
Aaron's take on the markets: The real estate markets continue to be influenced by the credit crisis and foreclosures. Unemployment filings are on the rise, which will also pressure home prices. The expectation is, home prices will continue to soften in the coming months with the key to stabilizing the markets being stopping bank foreclosure liquidations. Banks such as Bank of America, JP Morgan, and Citibank have all recently announced they will seek out borrowers who are in trouble and offer to rework their loans. Problem is, unless you are behind on your payments and your loan amount is 90%+ of your homes value, there may not be any help available to you. If you are thinking of buying or selling, let's chat.
Personal note: On November 4th, voters across the country helped make history by electing the first African American to be our president. Without any political bias being offered, I think we as Americans have come a long way and we have officially entered the 21st Century. Congratulations to those who supported and voted for Barack Obama.
Have a great Novermber and Thanksgiving! Aaron Cullen, Brokers Inc. Residential Real Estate
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