Monday, January 21, 2008

Silicon Valley Buyers Could Strike Gold

A convergence of high inventories, low interest rates and sellers motivated to move their homes is giving Silicon Valley buyers opportunities they haven't seen in years.

by Broderick Perkins
© 2008 DeadlineNews.Com

Deadline Newsroom - There's a growing pot of gold in Silicon Valley's housing market, a region that could very well become one of the nation's first major metropolitan areas to take some of the rust out of the housing bust.

Ground zero for high-tech innovation and even higher incomes, Silicon Valley has a growing abundance of homes for sale, sellers in the area are more motivated to sell and mortgage interest rates are cooperating, according to local real estate leaders.

On average, homes in the Silicon Valley area are selling for 98 percent of the asking price.

During boom times, the average selling price was more than 100 percent of the asking price, according to the Bay Area Real Estate Market Newsletter, produced by Richard Calhoun, broker of Creekside Realty in San Jose, CA.

Silicon Valley's ground zero, California's Santa Clara County, revealed that December 2007 home sales were more than 40 percent below the number of sales a year earlier, allowing inventories to remain near the record high levels set in October 2007, according to Calhoun.

It's the volume of homes for sale that is creating price breaks in a growing number of communities, generally represented by the yellow and green areas of softening prices on's "Heat Map".

December's median price for Silicon Valley's single-family homes, $799,000 was well off the record $880,000 median set in May 2007. Condo prices have likewise seen a down turn, from a record of nearly $550,000 in November to $520,000 in December this year, according to Calhoun's Bay Area Real Estate Market Newsletter.

Giving buyers more leverage, mortgage interest rates are the lowest they've been since September, 2005, according to Freddie Mac.

Silicon Valley buyers with high credit scores, unblemished credit reports, steady employment, low debt-to-income ratios, and ample savings can do even better than average rates, according to David Walsh, president of the Santa Clara County Association of Realtors.

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© 2008 DeadlineNews.Com

Broderick Perkins, an award-winning consumer journalist of 30 years, is publisher and executive editor of San Jose, CA-based DeadlineNews.Com, a real estate news and consulting service, and the new Deadline Newsroom, DeadlineNews.Com's new backshop. In both cases, it's where all the news really hits home.

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