The rich just got less rich.
The jumbo loan limit at Fannie Mae and Freddie Mac was dropped to $625,500 from $729,750. (Where do the bureaucrats get these precise numbers?) This means that rich people who want to buy homes from other rick people have to come up with larger down payments. This pressures sellers to lower their prices.
The San Francisco Bay area has very high priced homes. Year to year, the prices have fallen.
There were double-digit declines in sales of homes over $800,000 in Santa Clara, San Mateo, Alameda and Contra Costa counties. Those sales may have been affected by a drop in the size of loans accepted by two large government-sponsored companies.
Sellers are resisting, so they are holding their homes off the market. One realtor said: “Some sellers have a number in mind, and if it doesn’t look like they are going be able to get it, they’re saying I’ll wait a year.” Why they think prices will rise next year is beyond me.
Buyers who can buy are buying. There are not many alternatives.
Prices are falling all over the region.
The median sales price of a single-family home also sagged from last year, except in Santa Clara County, which saw an increase of nearly 3 percent to $525,000 from November 2010.
The median price was $260,000 in Contra Costa County, unchanged from last year. Alameda County saw a small decline to $387,500, as did San Mateo County, where median prices dropped to $605,000.
This is not hitting the lower priced homes. (Lower there, not lower where most people live.)
Sales of homes priced at $500,000 to $800,000 rose 5.8 percent compared with a year earlier in Santa Clara County, according to DataQuick. Contra Costa County saw a slight gain in the sales of single-family homes priced at $300,000 to $500,000.
How about auctions? Up.
The number of homes scheduled for auction hit a nine-month high in November, said James Saccacio, co-founder of RealtyTrac. “Many of the new defaults that started the foreclosure process over the past few months are now being scheduled for public foreclosure auction.”
All four counties — Alameda, Contra Costa, San Mateo and Santa Clara — had big increases in scheduled auctions.
So, the news is generally glum. Yet this is a region where big money resides.