Economic Forecast - Finally, you can believe what you read in the newspaper

January 21, 2008

I have long been a proponent of Bay Area real estate, and especially that rare piece of level ground on the Peninsula where the laws of Supply and Demand exert the greatest influence.

Amid tales of worldwide stock market tumbles (US markets were closed today in observance of Dr. King’s birthday), this little tidbit of sanity was embedded in an article in today’s online San Jose Mercury News:

Stock slides: Stocks sank around the world today, as U.S. markets remained closed for the Martin Luther King Jr. holiday.

The most dramatic decline was in India. The bellwether Bombay Sensitive Index plunged 1408.35 points, or 7.4 percent - its largest ever single-day drop in points. The pan-European Dow Jones Stoxx 600 index continued its six week slide, falling 5.7 percent to 308.77 percent.

Yet among the spreading gloom, Silicon Valley is shining.

“Silicon Valley is in better shape than the overall U.S. economy,” said John B. Sloven, director of the Stanford Institute for Economic Policy Research. “My overall assessment is the Silicon Valley economy is going to come through this pretty well unscathed.”

Some facts to consider: Prices in Silicon Valley’s wealthiest areas are holding up. Meanwhile, prices are dropping on low-end homes, increasing affordability. The region added jobs in December for the third consecutive month. Finally, the San Jose region is supposed to lead the state in personal income growth over the next few years.

(Read the full article here)

The interesting point is that the falling prices for lower end housing makes things more affordable for first-time homes buyers. My personal experience is currently supporting this, as I have a couple of clients shopping for their first homes in the $600,000 - $650,000 range, and are seeing personal benefit as homes that were recently listed tantilizingly close to their range, but just out of reach, at $700,000, are now being reduced to under $650,000.

The amazing thing about this area is that the economy continues to reinvent itself, the economic engine continues to churn through economic expansion and recession, and housing remains a scarce commodity because we have very little land to build new housing on.

Not to sound self-serving, but it is a great time to buy real estate here in Silicon Valley, especially if you can scrounge together a 20% down payment and have a history of actually paying your bills. Prices in some areas are down, flat in others, and interest rates continue to be near historic lows.

Donald Trump recently announced that he is seeking investors for a fund that will invest $100 million in California real estate in the next couple of years.

If California real estate is good enough for The Donald, isn’t it good enough for the rest of us?

Thanks for reading.

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Written by Chris Iverson, Realtor · Filed Under Business of real estate, Buyer and seller tips, Buyers, Consumer, Financing Process, For buyers, Investing, Loan Application, Mortgages, Real estate, Why we love it here | 2 Comments 

Why we love it here — #3, 4, and 5 — Menlo Park Fire Dept, The Dish, and Frys

September 17, 2006

I had a “threefer” Peninsula weekend, getting to enjoy three great things about this area.

I was at a kid’s birthday party yesterday, and who showed up but the Menlo Park Fire Department! No, the candles (there were only two of them) hadn’t set off a fire alarm. They came by prior arrangement to entertain the kids, who were entertained indeed. We adults were entertained just watching the kids!
This afternoon I went for a walk at the Stanford Dish. I love the great views of Menlo Park and Palo Alto on one side, and of the Woodside and Portola Valley hills on the other. I also love the whimsical Makin’ Hay sculptures looking over the entrance to the Dish. I forgot to bring my camera, so I’ll borrow these pictures from Stanford’s web site to give you an idea what the sculptures look like:

Finally, I found an excuse to spend some time at the Palo Alto Frys, our local electronics emporium. It was, as usual, packed with customers. While I love the wide selection available there, it’s often frustrating to get help, but fortunately I’m tech savvy enough to usually be able to find what I’m looking for. What I don’t get — but do find humorous — is the incongruous “Wild West” theme the store has. On the warehouse-sized floor they have statue-ish cowboys on horses right next to, say, the iPods.b

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Written by Kevin · Filed Under For buyers, Why we love it here | Leave a Comment 

Why we love it here — #2 — Little India Restaurant

September 9, 2006

Redwood City’s ongoing downtown facelift is transforming a dowdy area into a bustling, hip place. Near the center of action is a perennial Redwood City favorite, the Little India Restaurant. Combining delicious buffet-style fare with very reasonable prices, it’s a great place for both a quick lunchtime getaway and a slower-paced evening dining experience.Next time you have a hankering for Indian food, head over to Redwood City and visit the Little India Restaurant, at 917 Main Street.

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Written by Kevin · Filed Under For buyers, Redwood City, Why we love it here | Leave a Comment 

Why we love it here — #1 — Rodin sculpture garden

September 5, 2006

A friend of ours visited yesterday who had just come back from a holiday in France and Italy, and he was raving (and rightly so) about the architecture, the museums, the statues, and so forth.Well, the mid-Peninsula may not be France or Italy, but we do have some interesting architecture, museums and statues of our own. You have to go no further than Stanford University to see what I mean. We took our friend to their Rodin sculpture garden and he was suitably impressed. Check it out next time you’re in the area.


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Written by Kevin · Filed Under For buyers, Real estate, Why we love it here | Leave a Comment