Sweetly Dig Into Redfin’s Local Stats

Case-Shiller: Spring Arrives in the Bay Area as Home Prices Bump Up

It’s time for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). The Case-Shiller data is generally considered to be the most reliable measure of overall home price changes for a region, since they only consider repeat sales of homes when calculating their index, instead of looking at all the homes that sold in a given month.

For the full source data behind this post, hit the S&P/Case-Shiller website. For a more detailed explanation of how the Case-Shiller Home Price Index is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – April data is released in June).

Here are the basic Case-Shiller stats for the Bay Area* as of April:

Only seven of the twenty metro areas tracked by Case-Shiller saw a decrease in their HPI between March and April (down from eighteen the previous month). The biggest increase was in Washington DC again with a solid 3.0% gain. Other markets that saw increases above 1% were San Francisco (+1.7%), Atlanta (+1.6%), Seattle (+1.6%), Denver (+1.5%), and Cleveland (+1.2%).

Here’s a look at the latest local tiered data, back through 2000:

And here’s a closer look at the recent changes, with the vertical and horizontal axes zoomed in to show just the last year:

Although the Bay Area’s middle and high tiers both had a decent bump in April, the low tier actually dropped a bit. Month to month, the low tier was down 0.3%, the middle tier rose 1.1%, and the high tier increased 1.5%.

Read the rest of this entry »

Details, Details

Hey all,

So, my original plan was to write a big long post going over every last nook ‘n cranny of our reader poll results in painstaking detail. But then I remembered that I basically have the attention span of a fruit fly.

So instead, I’m just going to post Pretty Bar Graphs of the results, and also give you a link so you can download the full excel version of the responses.

Without Further Ado… Pretty Bar Graph #1

As you can see, Updates on the Local Market was our big big winner, with around 425 votes. Trailing the pack was Profiles of Agents, with four votes.

And Now… Pretty Bar Graph #2

(…in which our hero discovers which feature types are most popular among readers.)

This one was a bit of a shockeroni for me, because I really thought video was going to dominate here. I mean, you kids love the YouTube and the Hulu and whatnot, right?

But I was wrong, as is often the case. Graphics and Illustrations came in first, and Nope, Just Articles was second, because you people love your precious words. So my next blog post will be a six-thousand-word essay on the impact of the Battle of Hastings on the 2000-2007 Real Estate Bubble. It should be riveting.

Point/Counterpoint was also pretty popular (with one truly awesome person actually suggesting that I team up with Jane Curtin), as was Instant Polls/Surveys.

Not Video, though. Or Contests. Which means I got my legs waxed for nothing.

Holy Cow! Guess What? It’s Pretty Bar Graph #3!

(…in which our hero runs out of clever subtitles and considers going to the supply closet for a Twix bar.*)

Okay, so this is where I asked about the name of Sweet Digs, because I’ll be honest with you, around the office it’s kind of a running joke. And not the funny kind of running joke, like when Steve Carrell would say “That’s what she said!” on The Office. No, more like the painfully tragic kind of running joke, where you’re laughing from a nauseating mix of nervousness and contempt, like anytime anyone said anything on the entire eight-season run of Full House.

But another surprise, people still like the name Sweet Digs, and the chart above proves it.

So there are all the pretty bar graphs, like I promised. If you’d like to read the full excel details, which includes all the free-form responses (minus identifying, info, of course), just click here to download it.

Whew! Thanks everyone.

*It was delicious.

Fannie Mae Covers Closing Costs on HomePath Properties

As part of their neighborhood stabilization program, Fannie Mae is offering buyers’ assistance through a couple of different programs, HomePath and First Look.

HomePath

HomePath helps buyers buy covering their closing costs, up to 3.5% of the home’s purchase price.

To qualify, buyers must be purchasing a HomePath property; this is a home that is owned by Fannie Mae, usually as the result of a foreclosure or owner forfeiture.  Buyers need to make the initial offer on the home on or after June 14, 2011, and the purchase must close by October 31, 2011; initial offers made prior to June 14 are not eligible.

• View full details on qualifying for this program.
• Search for HomePath properties.
• Read an FAQ on the HomePath program.

First Look

In addition to HomePath program, Fannie Mae also offers an edge to buyers hoping to purchase a primary residence (as opposed to investors, or buyers looking for a second home). Under the First Look program, only offers from primary-residence buyers will be considered during the first 15 days that a Fannie-owned REO property is on the market.

Redfin agents and partner agents are always available to help you make a purchase on a Fannie Mae-owned property.

How San Francisco Got Her Real Estate Groove Back (May 2011 Insider)

Redfin’s monthly Bay Area real estate insider report draws from our proprietary database of information on homes for sale and that just sold, along with insight from our agents to get a sense of what’s going on in the market right now. If you’d like to receive the report via email, just sign up.

Howdy Bay Area Redfin Fans!

The stalemate between Bay Area buyers and sellers may finally be ending. For months, regular sellers have been wary of entering the fray and competing against banks on price. Buyers haven’t wanted to get into a bidding war they’d regret. The result: few homes to buy, fewer sales.

But now we’re seeing some Bay Area buyers blink: with the summer season upon us, we’ve noticed buyers beginning to raise their opening bids, and prices in five of the six counties increased in May. This won’t actually increase prices too much, as we’re also seeing banks beginning to sneak more homes onto the market.

But deal sizes have definitely increased, in part because the government is paring back support for high-end loans this October. The big factor driving the high-end market is the local economy, which still exists in a world of its own: LinkedIn and Pandora have had monster IPOs, with Zynga, Facebook and many others still to come. For whatever reason, many Bay Area Redfin customers are suddenly touring very nice homes.

Meanwhile at Redfin, we’re now asking everyone to update her profile with a Facebook photo, which we now use to personalize the site and in customer reviews of agents. And we’ve started leaving notes on most homes we tour — about the slope of the backyard or the traffic on the street — which we’re only allowed to publish to folks who register on our site. In some neighborhoods, we’ve left notes on a third of the homes for sale so it’s worth checking out for sure.

Prices Increase in Five of Six Counties

While prices are down from last year’s tax-credit boom, we already see evidence that the drop has stopped, less than halfway through the year. May prices were higher than April’s in five of six counties:

Change in Median Price of Houses That Sold in May 2011

Silent Spring: Inventory Drops in Four of Six Counties

The problem is that there isn’t much to buy. As we’ve observed on national television and in print, the supply of homes for sale is falling faster than demand, limiting price drops. This is especially true in the Bay Area where the number of listings declined in four counties last month, and remained flat in the other two.

Change in # of Houses for Sale on May 31st 2011

Competition Most Intense on the Peninsula, in San Francisco

Our own agents report that competition for a handful of turn-key listings in every neighborhood is most intense on the Peninsula and in San Francisco. But even in the rest of the Bay Area bidding wars are still common on almost any bank-owned listing.

Buyers Stepping Up Their Offers

Mark Biggins, Redfin’s Oakland agent, reports that “in the past month, three out of every four offers I make have faced competitive situations, where the home ultimately sells for $50,000 to $200,000 over the asking price.”

Amber Zahn, Redfin’s agent for Walnut Creek and San Ramon, reports that both bank-owned listings and traditional sales in San Ramon are still attracting multiple offers. “As buyers become more conscious of the competition, they’re coming in at more aggressive prices. The stalemate between Bay Area sellers and buyers is starting to end, and in sellers favor.”

Banks Stepping in to Reduce Their Backlog of Foreclosed Listings

But this is far from a universal trend. In San Jose Redfin agent Martin Garcia reports that inventory is “still plentiful,” and many buyers have grown “wary of getting lured into a bidding war” by the banks’ deliberately under-priced listings.

And we’ve noticed that bank-owned listings may be on the rise again, as banks release some of their backlog for the summer selling season. “In the past few weeks, I’ve seen a jump in offers on bank-owned homes, perhaps because banks are releasing more listings onto the market,” said John Chen, Redfin agent for San Mateo.

“The banks probably see the low inventory as an opportunity to make some sales while traditional home-owners wait out the double-dip,” John said. “Almost all the homes I’ve worked on in the past month have sold quickly, for the list price or above, usually in a bidding war.”

Sales Volume Mixed

Sales increased from April to May, but not by much once you adjust for May’s extra weekdays, and certainly not as much as you would expect when May is usually the beginning of the summer real estate bonanza:

Change in # of Houses That Sold in May 2011

Demand in our own Bay Area business has been light, but the buyers we do have seem more frustrated than scared-off, waiting for properties to buy not prices to bottom.

When we do put together deals, we’ve noticed that sellers have become very risk-averse, particularly about the appraisals required by a lender. If the house appraises for less than you’ve promised to pay, the lender will balk at loaning the money until the price is reduced or the buyers come up with more cash.

Many sellers’ agents are insisting that buyers use a local lender, just because no one outside the Bay Area is willing to believe that home prices here are still so high.

Redfin’s leader of the Peninsula team, Brad Le, noted that some sellers are asking buyers to sign disclosure packets in advance of tendering an offer. Here at Redfin, we are now also insisting that our customers write personal letters to accompany their offers, in case the seller needs an emotional tie-breaker.

So that’s it for this month! Consumers nationwide are spooked, but here in the Bay Area the problem is more that there isn’t much to buy, which lowers sales volume but keeps pricing from falling, regardless of whether they should. For numbers on every city and neighborhood, download our big spreadsheet. If you have any comments about this report, just post ‘em below.

Best, Glenn
Glenn Kelman | CEO, Redfin
Twitter | Blog

Waving as I Run By

Hey everyone!

I wanted to say a big fat wet sloppy thank you to everyone who participated in last week’s reader poll. There were nearly 800 of you, and almost everyone had something useful, informative, or enlightening to contribute.

(There was, of course, a small but vocal minority who did nothing but make dirty jokes and request that we start posting illicit photos, but that’s life on the intertubes.)

We got so many responses with so many good suggestions, in fact, that I’m basically drowning over here. I promise I’ll give y’all a nice, thorough run-down of the results, but as for today, I’m going to give you the Xtreme Reader’s Digest version.

Big Winners:

Updates on the local market, market statistics, and profiles of local neighborhoods were the top three requests, in that order. Message received. You want more hard data, more often, and more tightly focused on the neighborhood level.

Interesting Thing I Noticed:

We had a lot of requests for things that are already on Redfin, which tells me that we’re not doing a great job making that stuff easy to find. That’s pretty much my fault.

For instance, tips about home buying was a very popular request, and we have an entire free online guide for home buyers right here. It has a ton of information on the entire home-buying process, much of it tailored to each individual Redfin market.

Other Interesting Thing I Noticed:

Readers seem to fall into two camps: people who want more “fluff” (like cool homes, tips on design, stories from agents, etc.) and people who want no fluff at all and think fluff is stupid and would punch me in the face right now if I would just stop saying “fluff.”

I don’t think there’s a way to make every post appeal to everybody, but it does seem like more variety will keep everyone intermittently not-unhappy. And what more could you ask, really?

By Popular Request:

Finally, a lot of people asked in the free-form comments why we don’t just go back to the old days, when we had lots of different bloggers writing content for every city’s version of Sweet Digs. This was all before my time, but basically it was just too big an operation for us to handle at that point, and we needed to focus more on the core business (which is, of course, panda-cloning.)

We also had the loose-cannon issue crop up a couple times; bloggers saying things in the Redfin name that were completely ridiculous, like that we were cloning pandas.

But moving forward, we do want to distribute the writing work on our blogs out a bit more, both among our agents and (possibly, don’t quote me on this) among non-employees.

How will we approach that? No idea. I’m making this up as I go.

More soon on the survey results, including a downloadable spreadsheet of the results (stripped of any identifying reader info, naturally).

Until then, thanks again, and keep the good ideas coming.

What Do You People WANT?

I’m just going to level with y’all.

It’s one of my performance goals to write one of these blog posts every week, and every week, I approach the goal with a healthy heapin’ spoonful of a little something I like to call dread, or as they call it in German, dredenscheiningruvenshtocken.*

Now at first I thought that this dread was just some sort of performance anxiety, but I had an epiphany yesterday. Okay, maybe epiphany is a little strong. Maybe “duh-moment” would be more accurate.

I have no idea what you guys and gals want to read about. None at all.

But I’m not supposed to admit that, right? I’m supposed to just keep trying different articles and then track your pageviews like I’m some sort of criminal mastermind, then slowly and gradually hit on a winning formula of pure crowd-pleasingness; drawing you in, addicting you to content without you ever even knowing it. Mwa ha ha.

Frankly, that sounds like a lot of work, and really, I’m not the mastermind type. So I thought I’d just ask. Nicely.

So, could I please ask you to take a minute to fill out a little survey I came up with? Please? Pleeeeeease? (It helps if you picture me staring up at you with big puppy-dog eyes. It works especially well if you picture me as an actual puppy.**)

Take the Sweet Digs survey!

I can’t really promise you any toys or treats or anything, but I can promise that I’ll do my best to give you something worthwhile to read. And then everybody wins.

Thanks all!

*Not real German. Sorry Germany!
**Seriously, can you imagine that? Some cute puppy sitting at a keyboard, typing away with his little paws? That would be adorable!

One Seriously Jacked-Up Roof

Imagine you’d bought a home, and one day you went into the attic while chasing after a raccoon and–

What? No. I don’t know why you’re chasing a raccoon. Maybe it stole your sandwich.*

Anyway, you climb into the attic, wrestle the raccoon into submission, reclaim your sandwich, and then look over and see a tire jack holding your roof up. Wouldn’t you be a little upset? Even more so than you were about the sandwich?

This is why we have home inspectors. To inspect homes. For things like tire jacks and raccoon colonies.

You might think that you don’t need an inspector. You might say to yourself: “Self, I know how to tell if there’s something wrong with a house.”

But you’re probably wrong, because:

A: A good home inspector has the training and experience needed to identify hundreds of problems with a home’s structure, foundation, wiring, plumbing, ventilation, roofing, and other key components. Many of these problems are not obvious to the casual (or even business-casual) eye.

-and-

B: Home inspectors go into places like crawlspaces and attics, and spiders live in those places. Spiders.

We talked to over a dozen home inspectors, collected more than 200 images of common home inspection issues, and put that info into a neat little interactive home. It won’t make you a home inspection expert, but it will give you an idea of what to look for when touring a home. And hopefully it’ll help you realize how important a good inspection can be before you buy that home.

Don’t wait for a sandwich-stealing raccoon to show you the value of a home inspector. Check out our Interactive Home Inspection right now.

*It’s a roast beef sandwich. Unless you’re a vegan. Then it’s kelp or hay or something.

(Photo courtesy Gary Cornia & Cornia Consulting, LLC.)

Case-Shiller: Bay Area Low & Middle Tier Home Prices Keep Falling

It’s time for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). The Case-Shiller data is generally considered to be the most reliable measure of overall home price changes for a region, since they only consider repeat sales of homes when calculating their index, instead of looking at all the homes that sold in a given month.

For the full source data behind this post, hit the S&P/Case-Shiller website. For a more detailed explanation of how the Case-Shiller Home Price Index is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – March data is released in May).

Here are the basic Case-Shiller stats for the Bay Area* as of March:

Eighteen of the twenty metro areas tracked by Case-Shiller saw a decrease in their HPI between February and March (one less than the previous month). Washington DC saw a 0.9% increase while Seattle eeked out a 0.1% bump.

Here’s a look at the latest local tiered data, back through 2000:

And here’s a closer look at the recent changes, with the vertical and horizontal axes zoomed in to show just the last year:

The Bay Area’s low and middle tiers both fell fairly substantially from February, but the high tier gained some ground. Month to month, the low tier was down 0.9%, the middle tier fell 1.5%, and the high tier increased 0.7%.

Read the rest of this entry »

Help Us Write a Home Selling Guide, Get a T-Shirt

Today, we’re officially launching the remaining sections of our Home Buying Guide. This is something we’ve been working on for a long, long time, and it feels good to get it out the door.

That’s not to say we won’t continue trying to make the guide an even better resource for home buyers; we’ll be tweaking, polishing, adding to, and editing this thing until the next ice age. If you have suggestions, comments, or questions about any of our HBG content, please leave a comment here, or on any page of the guide itself.

But we are starting to gear up for our next big guide project — the Redfin Home Seller’s Guide. We’ll be packing it full of useful information, with a heavier emphasis on interactive features, quizzes, graphics, illustrations, and other goodies.

Here’s where you come in: if you’re selling a home, what’s the stuff that keeps you up at night? What can’t you find good information about? What’s confusing? What’s frustrating? What do you wish you’d known three months ago?

Finally, if you’d like to be involved in providing customer feedback on preview versions of the guide as it’s developed, just drop a comment here and let us know. We’d love your input, and if we choose you to be in our customer feedback group, we’ll send you a free Redfin T-shirt.