Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports. Here’s what Mr. Weeks says about last week’s activity:

…if Bonds and home loan rates thought they were out of the days of volatility…they got pulled right back in, as last week brought daily price swings of almost historic proportions. For the week overall, fixed home loan rates improved by about .25%.

What led to the dramatic action this week? The bipolar emotional state of the markets began deeply depressed on Monday, but then were filled with joy Tuesday, when the Fed made an interesting move by announcing the creation of the new Term Securities Lending Facility (TSLF). The TSLF will provide borrowing banks with $200 Billion to draw on to help inject liquidity into the credit markets, and further, will accept some mortgage-backed securities as collateral, which effectively may help to “upgrade” the value and perception of battered Mortgage Bonds.

But in the meantime…struggles are still being played out related to the downgrade and losses experienced by companies holding massive amounts of mortgage-backed securities. Headlines hit on Thursday about The Carlyle Group, which manages a portfolio of mortgage-backed securities, not being able to meet a margin call and being forced to sell off large amounts of mortgage paper into the markets at great financial losses. Then on Friday, the news broke that financial brokerage and investment banking giant, Bear Stearns had suffered enormous losses, and their lack of liquidity endangered them from going out of business…or “sleeping with the fishes”. The new aforementioned TSLF is designed to help this type of liquidity problem, but it will not go into effect for a few weeks, and Bear Stearns would not last that long. Coming to the rescue with loans were both the NY Fed and JP Morgan Chase. These sure are exciting times.Read the entire report here.

One bright spot for the financial markets was a low consumer inflation reading. The Overall and Core Consumer Price Index (CPI) figures were reported unchanged, far cooler than the expected increases of 0.3% and 0.2% respectively. These tame inflation numbers give the Fed a green light to cut the Fed Funds Rate by another .75% at Tuesday’s meeting…but read on to understand exactly how this cut may impact YOU.

- Foster Weeks

Finally the Chronicle published a good real estate story about San Francisco on Sunday declaring it a “superstar city”, defying the economic downturn.

Carol Lloyd, normally a gloom and doomer (though she does “scratch her head” as to why Bay Area cities have bucked the trend… wishing there was gloom and doom???), does admit that San Francisco is not following the national downward trend of real estate.

We knew this all along, though sales volumes are off, prices are not.

-Mick Orton
Marketing Director

SFResidence is part of the TRI Coldwell Banker office at 1699 Van Ness in San Francisco which is one of the premier offices in the City and has the market share numbers to prove it. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.

This week is slightly off from the last few weeks. As the nice weather gets dialed in, I believe you will begin to see more and more activity, regardless of what the news media says about the mortgage crisis. This Friday watch for my analysis of a story from the San Francisco Chronicle from Sunday by Carol Lloyd, an unusually positive story!

Here are the numbers posted this week: 3/12/08:

• 5 new listings (average price $1,000,400 – low $639,000, high $1,350,000)
• 7 ratified sales (pending) (average price $2,033,286 – low $849,000, high $3,995,000)
• 6 closed sales (sold) (average price $927,333 – low $395,000, high $2,195,000)
• 1 back on the market (price $699,000)

- Mick Orton
Marketing Manger

Read what Rick Turley, President of Coldwell Banker, San Francisco/Peninsula says in his latest weekly report:

It’s official. The Department of Housing and Urban Development has released the amounts of increases in the conforming loan limit for FHA, Fannie Mae and Freddie Mac secured loans. This is great news for Bay Area homeowners, home buyers and home sellers alike. For homeowners, the increase may allow them to refinance their existing “jumbo” loans at a lower rate of interest.

For buyers, it may make getting a loan much easier and cheaper. For sellers, it ought to spur fence-sitting buyers to take more immediate action and start writing offers on all those open houses they’ve been flocking to for the past weeks. Though there is a possibility that the increases will be permanent pending new legislation, for now the conforming loan limit increases are only confirmed through the end of 2008. Buyers have a distinct time-frame through which to take advantage of this opportunity. Move-up buyers and first time buyers both have a terrific break right now to find the home of their dreams.The new increased limits (up to 125% of an area’s median home price) impact practically all of our Bay Area Counties. Alameda, Contra Costa, Marin, San Francisco and San Mateo all qualify for FHA, Fannie and Freddie increases up to the cap of $729,750. Sonoma County’s FHA conforming loan limit increases up to $662,500, and for Solano, the increase is up to $557,500.We aren’t certain when new loan products will actually hit the market and become available, but it shouldn’t take long. Lenders have to be pre-approved to offer FHA loans, so it’s more important than ever for buyers to be working with skilled real estate professionals who have the connections and resources necessary to make recommendations and guide their clients toward reputable, pre-approved lenders. Our Princeton loan officers are doing a great job keeping us abreast of new opportunities.

Read the rest of the March 2, 2008 report here.

- Rick Turley

* For an e-mail alert when this report is updated, send an e-mail to info@SFResidence.com with “weekly market report” in the subject line.

Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports. Here’s what Mr. Weeks says about last week’s activity:

…Bonds and home loan rates just experienced one of the most volatile, crazy weeks ever seen, with fixed home loan rates rising by about .375% by the time the smoke cleared.
Imagine a home that received a loan for 50% of the value…but a provision in the loan stated that under no circumstances could the equity fall below 50%. And the home would need to be appraised every day to evaluate this. If the home lost significant value, the lender would be entitled to an immediate payment to retain the 50% equity position. So if the home did indeed decline in value, the lender would make a call for capital to make sure their 50% margin of loan-to-value remains intact…hence the name margin call. If the homeowner had the cash to meet this call – all is well. But if the homeowner did not have the cash, the only way to satisfy the lender would be a sale of the home. And that is basically what Carlyle Capital Group and Thornburg Mortgage had to do last Thursday…they didn’t have enough cash on hand to meet their margin call, so they were forced to sell home loans that they were holding. This flood of mortgage paper on the market pushed Mortgage Bond prices lower…much lower.The week was shaping up to be one of the worst in history for Bonds and home loan rates – but then, remembering that weak financial news is good for Bonds and home loan rates, Friday’s utterly dismal monthly Jobs Report came to the rescue. On the report that there were a net loss of 63,000 jobs in the US last month – as well as negative revisions to previous months reports – Bonds rocketed back higher, at least enough to erase the previous day’s losses, but still ended significantly worse off for the week overall…

Read the entire report here.

During the first four days of last week, Bonds underwent a crazy 313 basis point sell-off – more than they sometimes move over the course of six months. Why the insane action? Uninspiring commentary from Federal Reserve officials, renewed fears of inflation…and another very interesting story playing out last Thursday. Losses from The Carlyle Capital Group and Thornburg Mortgage decreased their capital to the point where their financial backers had asked for cash back in the way of a “margin call”. What does this mean?

- Foster Weeks

If you’re up for a day trip and enjoy skiing, there is still a lot of snow and great spring skiing at Sugar Bowl. Only about an hour and a half out of Sacramento on I-80, take the Norden, Soda Springs exit and turn right at the stop sign. About 3 miles up the road is the entrance to Sugar Bowl.

A friend and I went yesterday and the runs were well groomed, though a little icy early morning and late afternoon. For a day trip this resort is perfect because it’s much closer than Alpine or Squaw and has longer runs than Boreal or Soda Springs (so I’m told). We like to go mid-week to avoid the crowds. And if we get more rain next week as predicted, there’s a chance some of it will end up as snow at the higher elevations!

Visit their website at http://www.sugarbowl.com/home.

- Mick Orton

Find other things to do here.

SFResidence is part of the TRI Coldwell Banker office at 1699 Van Ness in San Francisco which is one of the premier offices in the City and has the market share numbers to prove it. We have some of the top agents selling real estate in the San Francisco Bay Area. As a result, our office posts some impressive numbers.

Each week seems to get a little better than the last. As you can see from the numbers below that things are definitely starting to pick up.

Here are the numbers posted this week: 3/5/08:

• 11 new listings (average price $1,253,091- low $650,000, high $1,850,000)
• 7 ratified sales (pending) (average price $1,731,143- low $625,000, high $4,700,000)
• 12 closed sales (sold) (average price $1,135,667 – low $395,000, high $5,500,000)
• 2 reduced price (average price $1,107,000)

- Mick Orton
Marketing Manger

Read what Rick Turley, President of Coldwell Banker, San Francisco/Peninsula says in his latest weekly report:

While listening to the radio the other day, I heard a news report stating that consumer confidence has plummeted in February to a 17-year low. The reporter went on to discuss how fears about the housing market and its impact on the economy are major factors in the increasing pessimism of the American consumer. Later, however, I found the actual consumer confidence index report online and, upon reading it, discovered this little nugget: Those with plans to buy a home rose in February from 2.5% to 2.7%. It was actually one of the few areas of the report that had improved month over month. I’m still trying to figure out how that news reporter wound up blaming the country’s real estate market for a decline in consumer confidence when the index clearly states that confidence in home buying is improving. The index also notes that consumers with plans to buy major appliances increased from 30.6% to 30.9% – maybe those new appliances will be installed in their new homes?

During a rainy holiday weekend, it became apparent that there are an increasing number of buyers who are getting serious about hopping off the fence. Though many seem to be waiting for the conforming loan limit increase in the economic stimulus package to take effect, there are also many who are taking advantage of the affordability existing in many of our markets right now. Buyers that are waiting to see a bottom would be best served by jumping in now. Typically, by the time we can see a bottom in the charts we are well past it and on the way back up. In areas with higher levels of inventory, price, condition and location continue to be crucial factors in home sales at virtually every price point. When those elements are balanced, we are seeing multiple offers. We are also starting to see inventory levels stabilizing in many areas – Danville being a case in point where inventory remain unchanged week over week, but new pending sales increased by 67%!

Read the rest of the February 24, 2008 report here.

- Rick Turley

* For an e-mail alert when this report is updated, send an e-mail to info@SFResidence.com with “weekly market report” in the subject line.

Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports. Here’s what Mr. Weeks says about last week’s activity:

..[we] would certainly consider Bonds to be a success last week, as they moved lower to hit a technical “bottom” at the 200-day Moving Average, but then bounced significantly higher throughout the course of the week, helping fixed home loan rates improve by about .25 to .375%.
What caused all the activity? Remember that weak economic news tends to be bad for Stocks, but good for Bonds and home loan rates, as money flows out of Stocks and into Bonds. And last week had its share of weak economic news, combined with testimony before Congress by Fed Chairman Ben Bernanke.

The news included higher wholesale inflation with the Producer Price Index (PPI) jumping to its highest level since October 2004 on surging energy and food prices. But price inflation on the producer or wholesale side can’t always get passed directly on to the consumer on the retail side. Friday’s Personal Consumption Expenditure (PCE) reading showed consumer inflation to be higher, but just slightly, as expected. The PCE is the Federal Reserve’s most highly watched measure of inflation, and the current overall rate of year-over-year inflation at 2.2% does remain just above the Federal Reserve’s comfort zone for consumer inflation.

And speaking of the Fed, Chairman Ben Bernanke testified before Congress last week, making comments that prompted Stock investors to sell off and move money over into Bonds. The Bond market also enjoyed “dovish” comments made by Gentle Ben about inflation and the recent aggressive cuts made by the Fed, and his testimony was largely responsible for the improvement in Bonds and home loan rates. But read on, and learn how the next official Fed Meeting and Rate Decision on March 18th could impact home loan rates…it might surprise you.

Read the entire report here.

- Foster Weeks