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:

There were several major developments, beginning with the announcement that Japan’s Mitsubishi Financial Bank will purchase 10% to 20% of Morgan Stanley, saving the company from the same bankruptcy fate as Lehman Brothers. On Wednesday, the financial markets received another vote of confidence with word that billionaire investor Warren Buffett’s Berkshire Hathaway is investing $5 Billion into Goldman Sachs. But then on Thursday, Washington Mutual was seized by the federal government, and its assets were sold to JP Morgan Chase for $1.9 Billion. The fall of Washington Mutual represents the biggest US bank failure in history.

But perhaps the biggest news of the week began on Tuesday, as Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson began their testimony in front of the Senate Banking Committee on the $700 Billion rescue plan proposed by President Bush.

The plan calls for taking illiquid mortgage backed securities off the hands of lending institutions, and through the week several elements of the plan were intensely debated, including the amount of the plan, the government’s role, the absence of oversight, and limits on pay for executives of bailed-out financial institutions. And while full details are still pending, it appears that an agreement has been reached, with the intent to revive our financial system and avoid negative far reaching effects to the rest of our economy.

Despite all the historic events of the week, home loan rates ended the week only around .125 percent worse than where they began. I will continue to monitor this situation closely in the days and weeks ahead, and keep you informed.

Read the entire report here.

- Foster Weeks

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:

“THE PATH TO SUCCESS IS TO TAKE MASSIVE, DETERMINED ACTION.” Anthony Robbins. And success in stabilizing the markets and the economy is exactly what the government is hoping will happen as a result of the massive, determined actions they took late last week in response to unprecedented happenings in the financial markets.

Treasury Secretary Hank Paulson announced that the US government will guarantee money market funds, after panic led to a “run on the bank” type of environment. A whopping $180 Billion was withdrawn from market funds on Thursday alone. And the fear was so great that a premium to put money into Treasury securities was paid, which actually exceeded the rate of return. So effectively, the return was negative! People were actually paying for a place to put their money that would be safe because they had fears of losing principal. The government guarantee helped to ease these fears and stabilize the markets.

The Fed announced plans to create a market place for illiquid mortgage debt. This should do a lot of long-term good to help the housing and lending environment. As if that weren’t enough, the Securities and Exchange Commission also placed a temporary ban on the short selling of 799 different financially related stocks.

What prompted these dramatic actions? Very dramatic happenings earlier in the week.

After 158 years in existence, Lehman Brothers filed for bankruptcy last Monday due to overexposure of high-risk loans in the mortgage arena. Then, the Fed gave insurance giant AIG an $85 Billion lifeline to keep it from going into bankruptcy, after initially stating it would not intervene. Then it was announced that Merrill Lynch is being acquired by Bank of America, which will save them from the same fate as Lehman Brothers, and now troubled bank Washington Mutual is looking for a buyer as well.

Also playing a role was the fact that the Fed left its benchmark Fed Funds Rate (the rate banks charge each other for overnight lending) unchanged on Tuesday, not wanting to counter the recent improvements the US economy has made in the way of inflation. While this benefited Bonds and home loan rates earlier in the week, Stocks felt heavy selling pressure on the news…which added to the reasons for the actions taken late last week.

The government’s announcements on Friday are great news for the overall health of our financial system, though they did cause Bonds and home loan rates to move away from their best levels of the week. All in all, Bonds and home loan ended the week slightly worse than where they began. Additionally, stocks had their most volatile week in history – but ended the week almost exactly where they started.

Read the entire report here.

- Foster Weeks

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.

We’ll say it again… what a difference a week makes! WOW is all we can say. The number of new listings this week is remarkable. Of course, this is the time when sales begin to pick up, so we were expecting more inventory, but apparently the banking scares have not affected those who are eager to sell.

Here are the numbers for this week, 9/17/08:

• 22 new listings (average price $1,570,333 – low $679,000, high $3,695,000, 1 confidential)
• 3 ratified sales (pending) (average price $585,667 – low $449,000, high $788,000)
• 2 closed sales (sold) (average price $2,742,500 – low $2,485,000, high $3,000,000)

- Janis Stone

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:

“THERE IS NOTHING WRONG WITH CHANGE, IF IT IS IN THE RIGHT DIRECTION.” Winston Churchill. And the housing and mortgage industries experienced a great change in the right direction last week, as the Federal government moved to support Fannie Mae and Freddie Mac, causing Bonds and home loan rates to improve significantly and end the week around .25 percent better than where they began.

So why did the Federal government take action? Fannie Mae and Freddie Mac both have issued many Bonds which over time mature, and Fannie and Freddie need to pay back the principal on the maturing Bonds. The way they raise capital to pay these maturing Bonds is to issue new Bonds, which happens every month. And as long as Fannie and Freddie can sell new Bonds this system works well.

But the problems in the mortgage industry have reduced investor appetite to purchase these Bonds. Without the ability to sell new Bonds, Fannie and Freddie are less able to meet the capital requirements to pay off the maturing Bonds. And if Fannie and Freddie were to default and become insolvent, the mortgage and housing industries…and homeowners across our nation… would face even more struggles than we are seeing now.

So the government’s decision to back Fannie Mae and Freddie Mac is great news for homeowners, because it ensures the continued liquidity of conforming loans nationwide and it ensures that buyers of this type of Bond have a safe investment going forward.

In other Bond-friendly news, we saw good news on the inflation front last week. Overall Import Prices declined for the first time since December, thanks in part to the recent plunge in oil and gas prices. And Wholesale Prices, which help measure inflation, fell in August for the first time this year.

Overall, the good inflation news and the Fed’s decision about Fannie and Freddie should lead to improving Bond prices and home loan rates in the long-term. With home loan rates at such low levels, it’s a great time to review your mortgage situation and make sure you have the rate and program that best suits your current financial needs.

Read the entire report here.

- Foster Weeks

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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.

What a difference a week makes. We know we’ve said it before, but that’s the nature of real estate. As summer comes to a close, real estate in San Francisco (and probably other areas) tends to pick up until Thanksgiving. People want to have that nice Christmas or Holiday tree in their new home! We’ve noticed an increase in activity and have even seen first hand some multiple offer situations. This is good news for the local economy.

Here are the numbers posted this week: 9/10/08:

• 9 new listings (average price $1,265,889 – low $449,000, high $2,500,000)
• 2 ratified sales (pending) (average price $2,096,500 – low $498,000, high $3,695,000)
• 8 closed sales (sold) (average price $1,236,361 – low $470,888, high $2,800,000)
• 4 reduced (average price $1,581,000 – low $775,000, high $2,250,000)

- Mick Orton

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:

“THE BEST WAY TO APPRECIATE YOUR JOB IS TO IMAGINE YOURSELF WITHOUT ONE.” Oscar Wilde. And for many Americans, job loss is not just something they are imagining – it’s reality – as the Labor Department’s August Jobs Report showed that the US economy has lost 605,000 jobs so far this year.

Last Friday’s Jobs Report revealed several important pieces of information. In terms of job losses, the report showed that 84,000 jobs were lost in August and that the numbers for June and July were heavily revised, so that an additional 58,000 jobs were erased. But the real buzz came when the report showed that the Unemployment Rate swelled to 6.1% from 5.7%, which marks the highest Unemployment Rate since September of 2003.

And since jobs losses are bad for the economy…and bad news typically causes money to flow from Stocks into Bonds…on Friday morning, Bonds and home loan rates initially built on the improvements they made earlier in the week. However, Stocks were able to rally later on Friday, and while Bonds and home loan rates gave back some of the improvements they made, they were still able to remain above an important floor of support at their 200-day Moving Average (a moving average is the average closing price of a financial instrument over a given period of time).

So despite the worsening trend for Bonds late day Friday, home loan rates still ended the week nearly .125 percent better than where they began.

Read the entire report here.

- Foster Weeks

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While it looked like we would have a stronger than normal end to our summer market, it was not the case. As you can see by the numbers, there were deals to be had. When the sales price versus the listing price drops under 100% like it did in all three categories we track, it means sellers were willing to negotiate. If buyers were ever looking for a time to buy and get the price they wanted, this was it. But as you can see the numbers of homes sold were down, indicating that buyers just weren’t stepping up. What does this mean for our fall market? Who can say? Anectdotally we can tell you that we have a large number of new listings coming up, and so do other agents in our office. Once the presidential race is decided we may see a bump in market enthusiasm, regardless of who wins. Our September report for August is now online 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.

Even though there was not meeting last week, the numbers did not inflate. Must be that everyone was on vacation. I know we were in the Big Apple. But Buyers and Sellers alike must have taken the 2 weeks off because our numbers are dismal. The feeling in the office this morning was that many listings will be coming on in a couple of weeks, but how long they will take to sell is another matter.

Here are the numbers posted this week: 9/3/08:

• 1 new listing $829,000
• 1 ratified sale - price not disclosed 
• 6 closed sales (sold) (average price $1,697,500 – low $555,000, high $4,000,000)
• 1 reduced to $775,000

- Mick Orton