San Mateo County amongst the most content congressional districts in the nation
Apparently some residents of San Mateo County belong to the most content congressional district in the nation according to Gallup. District 14 represented by Anna Eshoo ranked #1 in the nation for “well-being”. The San Mateo cities represented by Eshoo include parts of Redwood City, Belmont, Half Moon Bay, East Palo Alto, Atherton, and Menlo Park. The entire district actually stretches all the way down to Santa Cruz. District 12 represented by Jackie Speier also ranked very well. This is the district that includes Foster City, Burlingame, San Carlos, San Mateo, Moss Beach, Daly City, and South San Francisco.
Personally I am not too surprised by the finding because District 14 pretty much contains the richest towns in the entire nation. Generally higher income is correlated with better health and education. San Mateo County also has the best weather out of the entire Bay Area by far so that puts people in a good mood. Crime is also fairly low here so it is definitely a great place to live.
Perhaps realtors should use this news as a marketing tool?
Obama’s mortgage plan details released – How will it affect San Mateo?
Today the Obama administration officially released the details of their mortgage rescue plan. This is a plan that really focuses on loan modification. I do not think this would affect troubled San Mateo homeowners very much and this is why.
First of all, lets do some simple math. The median household income in San Mateo County is $80,000 to $90,000. Granted, this is pretty high compared to the rest of the country, but the median housing price was around $800,000 during the peak. From what I have seen, a lot of these troubled homes were financed with 80/20 first and second mortgages and the mortgages are conservatively $4000 a month. Additionally, the property taxes on a home valued at 600k to 800k would be $600 to $800 a month. When you throw in insurance and maintenance the final cost is even higher. For a family earning $90,000 a year, 31% of their monthly gross income would be $2325, which means to keep their home their mortgage has to be reduced to $1500 a month. I think that is just laughable.
Now that the median price in San Mateo County has slid under $500,000, it would be plain stupid to pay property taxes on the basis of $800,000 and keep an unaffordable mortgage. So I really do not think Obama’s plan will affect the sliding prices here in San Mateo very much. Prices were just way out of reach for normal folks, and they need to fall. Most people I know that live here in the county have not had huge pay raises in the last couple years, and the current housing prices are still out of reach for many. I have said this many times before and I will say it again. The housing market wil only recover when prices come in line with income, and all of these government efforts to keep people in unaffordable housing situations are just a waste of time and money.
For the troubled homeowners out there, I suggest that you squat in your home as long as you can because banks are really slow to foreclosed these days. You can work on a short sale or tell the bank to produce the original mortgage note. This will give you a few months of free housing. Forget about keeping your overpriced shack because it is not worthwhile in the long run. Your credit can recover in seven years, and there is no point in paying a $800,000 mortgage at $4,000 to $5,000 a month when you can rent the same house for half that price.
$10,000 tax credit for Californians who buy brand new homes
This is a new rule that was passed with the new budget. If you want to read some details I wrote a post about it here.
Anyway, I don’t see this spurring much sales activity in San Mateo county because there are very few new developments. Most of the new developments are also very overpriced. I can see the homebuilders just jacking up their prices due to this law, and it will not benefit consumers very much.
Dataquick report for Jan 2009 – San Mateo median drops to 489.5K
In this Dataquick report for the nine county Bay Area, pretty much every county’s sales went up except for San Mateo and San Francisco. Here are the important tidbits about San Mateo:
- 34.1 percent of sales in January were foreclosed within 12 months
- 273 home were sold in the entire month, which is 7.5% below last year
- Median price is now $489,500 compared to $650,000 last year.
Another interesting factoid is this:
- Typical monthly mortgage Bay Area residents committed to pay was $1297 last month, compared to $2571 a year ago.
It seems like it may be becoming cheaper to buy in some parts of the Bay Area. This is the fifth consecutive month of sales growth for the Bay Area overall, but San Mateo County is still declining every month. Basically, this county has yet to reach the bottom.
Three San Mateo County cities amongst Bay Area’s most discounted
Redfin just posted a good data crunching post here about the Bay Area cities with the most discounts. Guess which ones are in the top ten? Burlingame, Redwood City, and Foster City all made the list. This is not surprising because these areas are very overpriced for what they are, and the people that live in these cities tend to think their homes are worth a lot.
Interestingly enough, East Palo Alto and Daly City actually made the list for least discounted. That is probably because most of the listings in these cities are bank owned and so the starting price tend to be very low. The report mentioned that East Palo Alto actually had homes sell for above asking, and I’m not really surprised because there are decent single family ranchers selling for under $200,000 now in East Palo Alto. I’ve been to that city many many times, and some areas are not that scary looking.
So the lesson to sellers here is that they should not overprice their homes. If they don’t hold on to unrealistic expectations of what their home is worth then they might sell their homes quicker.
An even bigger bailout is coming
Today the new Treasury Secretary announced a new $2 trillion plan which I wrote about here.
The details are few, and it is still very sketchy, but I doubt it will curb the falling prices here in California. Don’t they get that what we need is more jobs?
What is more scary is that this is in addition to the $838 billion stimulus bill making its rounds through the congress right now. In the past I would have told people to call their congress people, but it seems like congress has stopped listening long ago. Now that the entire congress is controlled by Spendemocrats there is no check and balance for the executive branch anymore. Where will this nation fall?
Anyway, I will continue to post San Mateo Home Sellers in Trouble for your entertainment.
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