California home prices jump 20.9% in May

California home prices jump 20.9% in May
Tax incentives spur sales. The median home price rises to $278,000, reflecting less a rise in housing values than a shift in sales toward more expensive coastal markets.

By Alejandro Lazo, Los Angeles Times
June 18, 2010

Fueled by tax incentives, California home sales rose in May, helping lift the Golden State's median home price by 20.9% from its year-earlier mark.

The median was $278,000 last month, MDA DataQuick of San Diego said, a 9% increase from April. But that reflects less a rise in the actual valuation of homes than a continued shift in sales away from cheaper, inland areas of the state toward more coastal markets.

That shift is being driven partly by an increasing willingness of owners in pricier neighborhoods to sell at a lower price, DataQuick has said. And much of the jump in sales has been driven by a surge of buyers rushing to close deals to take advantage of state and federal tax incentives.

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"In the second half of the year, there's obviously going to be less wind in the market's sails, given the fading tax credits," MDA DataQuick President John Walsh said. "A healthier job market and low mortgage rates will be key to driving demand."

A total of 40,965 new and previously owned houses, condominiums and town homes sold last month, a 9.3% increase from April and a 4.9% jump from May 2009. Experts fear that once the effects of the credits wane, sales and prices could slump again.

"Of course, you are going to see a slowdown; these programs basically steal sales from the future," said Christopher Thornberg, principal of Beacon Economics. "Now that may be a good policy option, but understand when you get to the future you are going to feel the effects of that. It's just the nature of the beast."

The federal credits of up to $8,000 for first-time buyers and $6,500 for some current homeowners required that deals be reached by April 30 and close by June 30, though Senate Democrats have moved to extend the closing deadline to Sept. 30.

The California credits, which kicked in May 1, are for first-time buyers and purchasers of new homes, with $100 million set aside for each credit. The state credit for first-time buyers is quickly running out. The state's Franchise Tax Board said Thursday that it had received applications claiming an estimated 80% of the first-time credit. It expects to run out of money for the first-time credit much faster than the one for new homes as those sales often lag because of the time it takes to construct a home and because the resale market is much bigger. The state did not say Thursday how many applications had been received for the new-home credit.

In the San Francisco Bay Area, sales took off in some of the region's costlier neighborhoods last month, DataQuick reported, helping push the median home price above $400,000 for the first time since the U.S. was gripped by the financial crisis 21 months ago. The decline in bank-owned inventory there helped the median sale price for all property types reach $410,000, up 10.8% from April and 20.1% from May 2009. Sales jumped 18% in May over April and 11% over May 2009.

The Southland's median price rose 22.5% from its year-earlier level to $305,000, DataQuick said Tuesday, and sales jumped 7.2% from May 2009.

What kind of agent do you want?

What is the first picture that comes to mind when you think of a REALTOR (or real estate agent?) Someone like a used-car salesman, trolling along, looking for the next "victim"? Do you think of someone slick, boisterous, dimple cheeked and twinkle eyed? Or do you think of a slender, sly Eddie Haskell like person, waiting to manipulate the next situation? All of these perceptions are negative - and too often, they are true.

But, I am here to say, we are NOT all like any of those people. I prefer the honest, discerning approach to sales. I sometimes feel like a counselor, navigating through the process with an emotional couple, or people in all sorts of transition. A huge part of my job is establishing trust with my clients. If you have an agent that you have worked well with, you know what I mean. If you have an agent that made you question things more than understand them, I think you also know what I mean!

So, what are some good criteria when looking for a truly honest, hardworking agent?

1. Make sure that the facts they use to represent themselves are true -- and not inflated! I know of an agent who has claimed to be an expert in a certain area of sales - yet I know he did far less sales then he claims. It is aggravating to me and other agents -- and it is scary to think of the clients that believe him!
2. Make sure their Real Estate license is current, assigned to a broker in the area you are looking to move, and that they do not have any violations against them! (Look on CAR.org and enter license look-up)
3. Make sure their advertisements are where they say they are! Ask for copies, or look on your own. Do you see the ads they said they are paying for? You should!
4. Ask for references. A good reference can help clarify if the agent is the right choice for you!
5. Remember experience counts, but so does integrity! Look for honesty, validate what you are told and make sure they are not "too busy" to personally meet you at properties or inspections! A good agent will always schedule their time and be present.


Of course the above criteria are totally based on what I would want in a REALTOR. I made this list myself after buying our first home with a "Top Producing" agent. I realized I would do the job very differently -- and became a REALTOR. As a wife and mom, I know purchasing a home is one of the most important decisions a person can make....MAKE SURE you are with a TRUSTED AGENT!!!!

Happy House hunting!!!!