Foreclosures and Neighborhoods influence the San Francisco Bay Area real estate market
The competition for bargains have a high influence on the Bay Area housing market, specially in Oakland and nearby San Francisco. In this case bargains mean foreclosed homes. These areas have a high number of distressed properties: nearly three of every 1,000 homeowners lost their homes to foreclosure in May – a Zillow report shows. In addition foreclosure resales made up to 36 percent of the real estate sales in the same month, although that’s down from a peak of 66% in March 2009.
June brought 20% discount from the properties sale price, so professionals from San Francisco came across the bay and bought homes in Oakland. According to the report the buyers paid 0.1% less than asking price, that means only $1,080 less than the last listing price.
"We’re seeing multiple offers, we’re seeing above asking price" said David Kerr, a ZipRealty agent from Oakland. "People are buying foreclosure, fixing them up and selling them and getting offers", he added.
However the lenders don’t give out money so easily. They generally require appraisals before giving a mortgage and appraisers consider what foreclosed homes in the area sell for when determining how much home is worth. And if the home is sold at too a right prices, the sale falls apart.
Although San Francisco struggles to regain its footing, that doesn’t seem to have influence on the Noe Valley neighborhood. Here most homes are going to just above listing price – according to the Zillow.com. Homes sold for and average of 0.02 percent more than the selling price. Although that’s only around $200 but the phenomenon is what drags the attention.
"It’s crazy. I had some house with five offers and it went from $1,4 million to 1.7 million," said Brendon DeSimone a San Francisco realtor. "The valley just popped. It’s not uncommon for one open house to have 200 people come through" he added.
Posted by Istvan Fekete
on Aug 4 2010. Filed under Foreclosures.
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