Following a statewide trend, experts say it’s a buyer’s market in San Mateo County, a trend they expect will last through 2008.
Homes stayed on the market significantly longer in September, compared with last year’s figures. In Sept. 2006, the San Mateo County Association of Realtors, relying on Multiple Listing Service data, showed 413 homes sold. In Sept. 2007, there were only 262 sold.
Instead of a home selling in 31 days, the average is up to 51 days, according to Multiple Listing Service data. Geoffrey Craigshead, president of SAMCAR, recalls “the good old days” when a home could be sold in approximately 20 days.
Within the past ten years, borrowers with bad credit who did not qualify for mainstream loans went to so-called subprime lenders, who seldom identified themselves as such, Craigshead said.
Because of a healthy mortgage market, directly related to the proliferation of subprime lending, properties appreciated by 20 percent annually for a while, Craigshead said. Buyers, even those with substandard credit, were able to purchase homes and quickly turn around and sell the property to one of several willing buyers, making a quick profit, he said.
“There was easy money out there and people were able to get loans very easily,” Craigshead said.
A year ago, subprime lending started to lose its cachet, removing the safety net many used to purchase property. The effects of that phenomenon meant fewer people were buying and, though home prices dropped, there wasn’t as large of a willing pool of buyers as one might expect, Craigshead said.
MLS figures back up evidence of a decidedly long list of real estate agents who have seen a significant drop in their workloads.
“I can’t expect it will get better in 2008,” Craigshead said. “My advice is to buy everything you can get your hands on now.”
Potential homebuyer Jen Chiang, who is currently staying with family in Millbrae, said that given the market, she has been considering buying a home in the near future. Though the market is good right now, she doesn’t have much of a credit history — due to a lack of credit cards — to support her need for a mortgage loan, she said.
“I’m in one of those rock-and-a-hard-place places,” Chiang said.