When it comes to real estate, what separates Dublin and Pleasanton CA is not Interstate 580, but maturity. Pleasanton is mostly built out with very little new construction. Dublin has been expanding with lots of new condos and single family home projects. A large part of Dublin’s housing inventory still consists of new building or homes that were built and sold at the top of the market and the beginning of the downturn.

As builders reduced home prices to move inventory and homeowners started getting out from under upside-down mortgages, the Dublin housing market took on a very different look and dynamic than it’s neighbor to the south - Pleasanton.

 Compare the MLS statistical graphs for Dublin & Pleasanton (Active Listings vs Pending Sales) from 8/16/08 to present. Notice how Pleasanton continues to reflect the normal up/down yearly pattern whereas Dublin absolutely reflects the impact of new construction price cuts and existing homeowners having to contend with that additional pricing competition in  the market dynamic.

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As you see, the average list price in Pleasanton is higher than Dublin as is the cost per square foot. Homeowners in Dublin are probably pricing their properties closer to market value than Pleasanton homeowners who haven’t felt the same pressures. The Market Action Index shows Dublin to be a more active market as buyers look for deals and steals.

The median price by quartile shows how the entire Dublin market continues to experience similar downward pressures in all price points, while Pleasanton with more high-end homes and real estate stability shows a definite difference between the top half of the market and the bottom.

 All in all, Dublin continues to be more of a market for first-time buyers as Pleasanton continues to be more of a move-up buyers market.

December figures show the verall number of homes for sale in the East Bay dropping.

Of the 27 communities listed the average inventory was down 7% to 4.27 compared to 4.59 in November.  There were 12 that increased and 15 that decreased.

Since June, the start of the foreclosures and short sales transaction boom that accounted for up to 40% of the overall sales the average numbers has been fairly steady, under 5.0 months inventory.  The highest in 2008 was January at 10.33 months.  The highest in 2007 was September at 14.40 months.

During normal times 4.27 months of inventory would be a seller’s market, but with this unusual market with many distressed properties selling in volume the normal bench marks no longer apply.  Once the market stabilizes with most of the foreclosures and short sales behind us the months of inventory figures will again have meaning to compare with past normal markets.

A balanced market in normal times is around 5.0 months.  The National Association of Realtors considers 6.0 months a balanced market.

Months of Inventory for Dec. 3rd is almost the same as thirty days ago Nov. 3rd, up just over 1% .  Of the 27 communities measured 14 were up and 13 were down.  Pending sales are up substantially because of all of the lower priced homes that are mostly short sales or foreclosed properties (REOs / bank owned properties).

Comparing Dec. to Nov. active listings are down 7% and pending listings back thirty days are down 8%.

Available inventory is stable and is historically on the low side because of the large number of pending sales, plus most sellers that aren’t  short sales or foreclosures are most likely not on the market unless they are highly motivated, especially during this time of year.  Average prices are down, but the lower prices are not all depreciation.  The larger percentage of lower priced homes selling and the shortage of financing for higher priced homes have played a big part in the lowering of average and median prices.  All residential properties that went through MLS, regardless of type, were counted.

This is an excellent time to buy for first time buyers, move-up buyers and investors.  This window of opportunity won’t last as we may be close to the bottom of the market cycle.

As you see in the graphs below, the number of foreclosures in the Bay Area dropped dramatically during September and October. Does this mean the worst is over? NO!

This drop refelcts the implementation of new California legislation that took effect September 1. As of 9/1/08, lenders had to give an additional 30 days notice to homeowners defaulting on mortgages before issuing a NOD (notice of default).

We can expect the numbers to jump in November and December.

Foreclosure Trend in Bay Area Counties

 Alameda

• 12 MONTH TOTAL: 21,472
• PER HOUSEHOLD: 3.86%
• MONTHLY CHANGE: -5.0%
• YEARLY CHANGE: 96.88%

 Contra Costa

• 12 MONTH TOTAL: 29,600
• PER HOUSEHOLD: 7.72%
• MONTHLY CHANGE: -5.07%
• YEARLY CHANGE: 77.93%

 San Francisco

• 12 MONTH TOTAL: 2,130
• PER HOUSEHOLD: 0.60%
• MONTHLY CHANGE: 20.18%
• YEARLY CHANGE: 73.06%

Santa Clara

• 12 MONTH TOTAL: 18,070
• PER HOUSEHOLD: 2.99%
• MONTHLY CHANGE: -22.04%
• YEARLY CHANGE: 101.91%

 Foreclosure Statistical Graphs for the Bay Area

Sitting at the intersection of Interstate 580 and Interstate 680, Dublin and Pleasanton California offer very different real estate markets. Pleasanton CA is a more mature real estate market with little land left to develop. Dublin CA has plenty of land for development, but new home builders are adding to the downward pressure on home values in Dublin with step discounts on new home inventory. Dublin also has a higher ratio of condos than Pleasanton.

October Short Sales

• 10 Short Sales in Dublin CA
  • 5 Detached homes ($418K to $850K) Average days on market = 70
  • 5 Condos/Townhomes ($360K to $423K) Average days on market = 34
• 7 Short Sales in Pleasanton
  • 5 Detached homes ($495K to $1.4 million) Average days on market = 130
  • 2 Condos/townhomes ($347K to $410K) Average days on market = 45

There are currently 43 short sales in pending sale in Dublin CA and 17 in Pleasanton.

Current Short Sale Inventory

58 in Dublin = 34 Detached / 24 Condo/Townhomes

32 in Pleasanton = 21 Detached / 11 Condo/Townhomes

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East Bay Short Sales / REOs / Foreclosures / Bank Owned Properties

The increase was from 3.74 months to 4.54 Months of Inventory.  Only two areas had a reduced number compared to twenty-five areas had an increased number. The highest number of pending sales were in Oakland with 323, 5.25 Months of Inventory, Antioch with 289, 3.05, and Hayward with 244, 3.79.

It appears that these three areas are areas having a large number of short sales/foreclosures in these areas at greatly discounted prices.

California home sales were up 6.1% in September 2008 over September 2007. Over 51% of resale homes in September were foreclosures.

Bay Area home sales were up 45% over September 2007 but the median home price dropped to $400K. Foreclosure sales in Contra Costa County contributed to a 10% increase in market share for home sales from counties with large inventories of foreclosures. Foreclosures accounted for 58.7% of homes sold in Contra Costa County while  foreclosures sales accounted for 37.9% of sales in Alameda County.

Moreover, nearly 42 percent of all existing homes sold across the Bay Area last month had been foreclosed on at some point in the prior 12 months, up from 36.1 percent in August and 6.9 percent a year ago. Foreclosures tend to sell at a discount and are concentrated in relatively affordable neighborhoods.

Properties are still selling.  During the last seven days there have been 49 pending sales in Danville, Alamo, Blackhawk, Diablo, San Ramon and Walnut Creek.  In just three areas Pleasanton, Dublin and Livermore there have been 48 pending sales.  Contra Costa Association of Realtors statistics in the fourteen areas covered,  from Orinda to San Ramon, for August (the latest available) shows pending sales up 56% for detached homes and up 17% for attached townhouse, condos and duets compared to last August. Foreclosures an short sales continue to be a substantial number of properties selling as many are at bargain prices.

In eastern Contra Costa County home prices continue to attract investors to the communities of Antioch, Brentwood and Pittsburg.

Bay Area Home Sales August 2008

Bay Area Home Sales Price August 2008

To see a trend you need to looks at the last three months figures as one month of pending sales doesn’t give you sufficient numbers to reach a meaningful conclusion. 

It appears that the same factors that have been affecting our market most of the year still remain.  It is still a buyer’s market although the Months of Inventory remains low.