News from the West Coast

I just returned from my biennial meeting of The Leadership Council.  This meeting was in San Francisco, and, although the weather is actually better here, I found it well worth attending, as always.  Around the country, brokers are feeling that the market is improving.  Since prices are still declining in some markets (including Connecticut), that doesn't mean that real estate brokers are in clover, but more units are selling, and faster.  Buyers seem less concerned that prices will drop a lot further, and they are moving on with their lives and finding homes.  Mortgages continue to be a challenge for many, and the effects of the Dodd Frank bill will continue to hurt that industry for years to come.

Some markets are a great deal better, and San Francisco is one of them.  There prices are rising, and units are flying off the shelf, despite a median price of over 1 million in the city itself.  Many homes are selling for more than the asking price, and often before the marketing has really gotten underway.  I was surprised that, for a place known as a high-tech mecca, the agents don't seem to use a lot more technology than we do. It still comes down to signs, open houses, broker to broker marketing, and word of mouth.  The one real change is that the internet has largely replaced print advertising, although there is still some of that.

Two interesting side notes:  I was the only person there without an iPad, which tells you something about why Apple alone is raising the NASDAQ results; and, two, this group, of owners from around the country, plan to vote for Romney over Obama by two to one.  The real news there is that they went for Bush over Gore by 18 to 4, so you can see that the election will be close!

Rates Are Creeping Up

Here's a shout out to all those buyers out there who are waiting to be sure that real estate prices have hit bottom:  You may succeed in buying when prices have passed the bottom, but you may lose on rates.  Although the Fed has signaled that it won't be raising its rates any time soon, the mortgage rates are more creatures of supply and demand, as well as bank appetites for new loans.  Rates also tend to follow a seasonal pattern--lowest at election time (what a surprise!), and higher in the busiest spring buying season).

 I get rates sent to me on a weekly basis, and it's clear that they are headed up.  If you have waited this long to buy, don't make the mistake of continuing to wait.  They may go back down in the fall, but, by then, prices will have risen.  Buyers have increasingly begun to think of the cost of housing as the cost of the monthly payment, since that matters far more to them than the actual price of the home at any given time.  Not only are mortgage rates heading higher, but insurance and taxes have risen in most places as well.  Buy now, or regret it later!