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While it may seem as if it is hard to determine what is happening in the downtown San Jose condo real estate market, there are some majors metrics that are quantifiable that can help you see where the market is going. These markers include:


  1.      Sales to list price ratio
  2.      Days on Market
  3.      Months of inventory
  4.      Number of active listings vs number of pending listings.


We can learn something from each of these metrics.


  1.      Sales to list price ratio: When the San Jose condo market is appreciating, the sales price will be higher than the list price. In Jan of 2017 the sales price of Downtown San Jose condos is 101% of the list price. This is obviously very healthy, but in Feb 2015 the sales price on average was 105% of the list price which was a much hotter market.
  2. San Jose Condo market
  3.      Days on market is a very good way to look at how the market is doing. The stronger the market the shorter the days on market. In Feb 2016 the average days on market was 15 and it increased to 28 in Jan 2017. Things are obviously slowing, but the San Jose condo market has not tanked.
  4. San Jose condo market
  5.      Months of inventory: Months of inventory tells you how long it would take to sell all the homes currently on the market at the current pace of sales. When months of inventory goes up it means the market is slowing, most of time.  The months of inventory in downtown San Jose has been less than 2 all through 2016 and into Jan 2017. It has gone up to 7 months in Feb., but there have only been 2 days so we can not count that yet.
  6. San Jose condo market
  7.      Number of active listings vs number of pending listings: this one is my favorite. You look at the number of active sales and compare to pending sales. When inventory is low and sales are brisk there will be more pending sales than active sales. When there are 4 or more times as many pending sales as listings it is a really hot market. When there are more active listings than pending sales it is a buyer’s market, or trending that way. There are currently 21 active listings and 32 pending  sales of downtown San Jose condos.


So how is the market of downtown San Jose condos?


Looking at all the metrics I would say it is good, but slower than in the first part of 2017.


If you have any questions about buying or selling a condo in downtown San Jose please feel free to call me.

Marcy Moyer

Keller Williams Realty

Specializing in Probate and Trust Sales


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Buying A San Jose Condo That is in Litigation

Brickyard San Jose

Developers don’t build condos with the intention of sloppy work that they hope no one will notice. But never the less, they almost always get sued in about year 8-9.


In California, new construction comes with a 10 year warranty on latent defects on the structure. In plain terms home owners and homeowner associations have 10 years to sue a developer if they find problems with the structural components of a building such as the roof, walls, plumbing or electrical systems, garages, decks, etc.


So, around year 8, if no problems have emerged, many HOA communities will hire a company to look at the building and see if there are potential problems that can happen due to faulty construction. If there are known problems they hire someone to try to figure out the fixes to the issues.


The communities will approach the builder to fix the discovered issues, and if the builder does not feel there is a problem, or the problem is not their responsibility then a law suit may be filed.


Once the suit is filed most lenders will not make loans on the property. The few who do will charge interest rates 1 to 2 pts higher than a traditional lender.


This can put the brakes on sales in the development, and will temporarily depress the price.


If you are a cash buyer, buying a San Jose Condo in litigation for a rental property can be a good idea if you follow these steps:


  1.      Look at the report that explains what the problems are that need to be addressed. If the issues are ones that do not need immediate attention that is better. If the plumbing system has failed, or there is major water intrusion into the building the homeowners may be hit with a special assessment during the multi year lawsuit. Even if the HOA of the San Jose condo in litigation wins the individual homeowners may not be reimbursed.
  2.      Find out what the estimated cost to repair the issues are for the San Jose condo in litigation. Take that number and divide by the number of units, or if available the percentage of ownership the condo in question has. So if the estimate is 10 million dollars, and there are 500 units with equal shares then each unit would be responsible for about 20 thousand in repairs if all units pay condo fees equally.
  3.      Find the market value of the condo you are interested in by looking at the most recent sale of that model before the San Jose condo litigation.
  4.      Subtract the amount of potential assessment.
  5.      If the market is slowing down overall subtract more.
  6.      Explain that you are taking the risk that the HOA of the San Jose Condo in litigation will not prevail in court, and even if they do the homeowners may be assessed before then. You are taking that risk, and buying when most others are not able. You are betting that you will not be assessed.
  7.      Even in a very hot market, this is a good way to get a better price on a San Jose condo in litigation than you would otherwise be able to.
  8.      It is safest to do it when the builder is a very large and stable company, rather than a less well capitalized entity that is more likely to go bankrupt.


There is obviously risk involved, but since such a large percentage of builders get sued, it can be a good long term investment. For example, The Brickyard in San Jose was in litigation in 2011-2012. During 2011 one bedroom condos sold for $140,000-$180,000. The litigation was setteled and in 2016 one bedrooms condos sold for $365,000-$395,000. If you bought a condo for at The Brickyard with cash in 2011 for  you would have at least doubled your money in 5 years plus get an additional $800 to $1500 a month profit in rent over the last 5 years. And this was a building with serious problems that have now been fixed with proceeds from the successful law suit.

Most suits are settled, the deficiencies are fixed, and the San Jose condos in litigation go on to appreciate.


If you have any questions about buying a San Jose condo in litigation as a rental property please feel free to contact me.

Marcy Moyer

Keller Williams Realty

Specializing in Probate and Trust Sales


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Why San Jose Condos Make Good Rental Properties


I am frequently asked by San Jose real estate investors, both veteran and new, what is best for San Jose rental investments, multi- family homes, single family homes, or condos.


My first answer has been the same for decades: “Are you most concerned with appreciation or cash flow?”


The answer to this question depends on a variety of individual goals. What has changed over the years is what is best for cash flow.


Historically San Jose rental property appreciation has been best in this order:


  1.      Single family home
  2.      Condo
  3.      Multi family home


Historically San Jose rental property cash flow has been best in this order


  1.      Multi family home
  2.      Condo
  3.      Single family home


This long held wisdom that a multi- family home is the best San Jose rental for cash flow is being disrupted by the latest market forces. Right now, CAP rates are better on newer condos than older multi- family homes, and are much easier to take care of.


The CAP rate on a San Jose rental property is a measure of cash flow. To figure it out you take the income minus expenses (assuming no loan) and see what percentage of the price of the property the expenses are. 4% is on the high end of what you can expect in this market, and many investments are in the 2% range for single family homes and 3% for multi family homes.


Let’s take a sale of a duplex in Japan town as an example of a San Jose multi- family sale in 2016.


Sales price was $1,000,000


Expenses including property tax, utilities, garbage, repairs, insurance total $15,200


Income is $43,200


Cash flow:  $43,200-15,200 is $28,000


Cap rate is the what percentage of $1,000,000 is 28000 or 2.8%


At this time duplexes are not covered by rent control, but that may happen in the future,


This duplex, like many of the homes in downtown San Jose, is very old. This one was built in 1930. While charming, they need a lot of repair and in many years repairs will be over $2000 a year which was this years estimate.


Now take that same $1,000,000 and apply it to two studio condos in a beautiful downtown San Jose building called Axis. I have a client who does own 2 studio condos at Axis that are rentals so these are real numbers.


Market value: $500,000 each $1,000,000 for both


Expenses including HOA, HO6 insurance, property tax and repairs is $24,000 for both


Income: $


Cash Flow: 57200- $24,000 = $33,200


Cap rate: 3.3%


In this case this new building needed very few repairs, there will never be rent control per California state law, and the HOA covers most of the insurance, water and garbage, and the repairs of the common area.

Here is another example of a clients cash flow at The Brickyard, a less expensive building than Axis San Jose, but a great downtown San Jose rental with the best HOA management company I have ever experieinced.


2 condos worth $370,000 each or $740,000

Expenses including property tax, HOA, HO6 insurance, repairs $19,400

Income: $48000

Cash flow: 3.9 % 

Things to watch out for as the building ages is making sure there is enough in the building reserve fund to cover expenses as the building ages.


When the reserves are healthy the future looks brighter for the condos because:


  1.      There is no fear of rent control
  2.      There will be no needed foundation repairs, earthquake upgrades, termite issues etc for the individual San Jose rental investor to deal with in the future as the building is new and the HOA covers these issues.


Of course every case of San Jose rental properties is different, but if you are thinking about buying a San Jose rental property a condo can be a great investment for cash flow, not just appreciation.

If you have any questions about buying a rental property in San Jose please feel free to contact me.

Marcy Moyer

Keller Williams Realty

Specializing in Probate and Trust Sales


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While prices are rising in the Silicon Valley there are still homes that are underwater and you may need to short sale your South San Jose home. If this is the case, don't wait!

Bank of America has instituted some new policies which can have a major influence on your South San Jose short sale.

Co-operative Short Sales: Bank of America has a program where they will let you know ahead of time how much they are willing to accept for you South San Jose home in a short sale. Once you agreed to do the short sale they would put a hold on foreclosure activity and give you some money at close of escrow.

The new policy is that there will be no holds on foreclosure until the offer is fully accepted by Bank of America. What this means is that if you can not make your payments  on your South San Jose home and want to short sell you can not wait. You will not be allowed to stay in your home for months trying to modify your loan and trying to get a new job. Once the notice of default has been recorded you will have 3 months to get your South San Jose home sold as a short sale before the notice of trustee sale is recorded. At that point you have another 3 weeks before foreclosure on your South San Jose home.

As any real estate agent familar with south San Jose short sales knows, they take time for approval. Even a Bank of America co-operative short sale can take time. 4 months is not unheard of to obtain approval on a South San Jose Short Sale, so if you can not make your payments, do something or you could lose your home to foreclosure.

If you have any questions about Short Sales in Santa Clara or San Mateo County please feel free to contact me.

Marcy Moyer

Keller Williams Realty

D.R.E. 01191194


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I am so excited about this news! I know, it doesn't take much for me to get excited, but this is really big news in my opinion.

Up until now if you were involved in a Silicon Valley Bank of America Short Sale they did not take electronic signatures. This would have been ok if the bank could sit with you in your conference room and look at the offers. We all know this does not happen and the paperwork will often be faxed several times before B of A gets to see a document. Since they cannot accept illegible documents it made things harder for the participants.

Also, despite the sometime lengthy process of a short sale, Bank of America will often say they need a document now, and not being able to get electronic signatures is sometimes tough.

Now, for any new short sales, you can send all documents with electronic signatures. This makes me very happy. As a Silicon Valley Short Sale Specialist anything that can make a short sale more efficient is ok with me.


So if you have any questions about short sales in San Mateo or Santa Clara Counties please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E. 01191194

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Just got approval on another short sale in San Jose with Chase. They are getting to be one of my favorites!

This was not straight forward. Client lost his job and was not able to make payments. He tried a loan mod but did not qualify due to having too much in retirement account. Client is close to retiring.

Put condo on market and got 13 offers. The San Jose inventory for small affordable condos is quite low. Accepted an offer 30% over asking price, cash, with no appraisal contingency. Asking price was market value at the time of the listing. Last 2 sales in the complex were within 5K of listing price.

6 weeks later get approval from Chase but buyer, who was an investor, dropped out.

I start to worry because none of the other 12 offers were over 10% over list price and I am afraid Chase (or actually Freddie) will want more since first offer was so high.

Submit a back up offer for 10% over list price, cash with no contingencies. 4 weeks later get approval.

Everyone is happy!!!

So fortunately the first offer which was so high did not taint the the process, and since there was no foreclosure date set there was not a danger of losing the condo to a foreclosure. But this is a risk in short sales in the Silicon Valley. The inventory is low. There are many investors and first time buyers in the market competing with each other. Sometimes people make ridiculous offers which they later regret.

How do you know what is the best offer? Is it the highest, is it the owner who wants this home more than anything, is it the person who puts the most money in escrow, has the least contingencies?

This is a complicated question that deserves its own blog. But my best advice to sellers of short sales is start by picking an experienced agent who knows how to analyze offers from a short sale perspective. This is not the same as a traditonal sale perspective. And understand that sometimes things go south, so be prepared for some bumps in the road to finally get to the magic words:

Congratulations: You are off the hook!

If you have any questions about short sales in San Mateo or Santa Clara County please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E. 01191194

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San Jose Short Sale Got Wells Fargo Approval

I just got approval on a Wells Fargo Short sale in San Jose. It was both a long and short road.

The long road first:

Town home put on the market in October of 2011 at $575,000. After one week we received an offer for which the seller accepted and it was sent to the bank.

Sellers were not behind on payments but are getting divorced and neither one can afford the home alone or afford to buy out the spouse.

Bank orders BPO which comes in a little under accepted price. I do not under price my short sales because I want them to get accepted by the bank. Also I knew this would be a popular property.

Negotiator immediately rejects the short sale saying the investor will not approve short sales where the seller is not behind in payments. Keep in mind this is not a Wells Fargo policy, it is the investor who bought the loan's policy.

Seller stops making payments and we plan on going back on the market in Jan of 2012.

Before we go back on the market a buyer makes an offer which is accepted by the sellers on Jan 16th.

Offer goes to Wells Fargo and this time is accepted on Feb 29th, 6 weeks after submission. 

On March 2, 2 days later the approval from the second which is a Wells Fargo HELOC arrives.

We are all happy with the results!

If you have any questions about short sales in Santa Clara or San Mateo County please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E. 01191194

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Cambrian Distressed Property Watch 2011

It's the beginning of the year so time for the round-up of last year's distressed property sales in the Cambrian Neighborhood of San Jose. So here's what happened:


Single family and condo townhomes :

Total sales:  656

Short Sales: 130

REO:            89

Distressed sales as a percentage of total sales: 33.45

Compare to 2010

Total sales:   750

Short Sales:   114

REO:            104

Distressed sales as a percentage of total sales:  29%


My conclusion:

The percentage of distressed properties in Cambrian is higher in 2011 over 2010. Also a 34% distressed property sale percentage is absolutely probably not enough to affect values. What is interesting is the the number of short sales in 2011 went up as the number of REOs went down from 2010 as banks have been more wiiling to approve short sales. This is being seen all over the bay area.

If you have any questions about short sales or bank owned homes please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E.  01191194

Marcy Moyer Keller Williams Realty Palo Alto, Ca. Specialist in Short Sales and Trust and Probate Sales

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There are several different types of short sales that will approve your price and the seller's eligibility before you get an offer. If you do not qualify for one of those programs (like HAFA or Bank of America co-operative short sales) then you can try to do a traditional short sale.

In most traditional short sales after the seller signs an offer, his/her short sale real estate agent will send the offer and all of the seller's financial documents to the lender. This can be a time consuming process, and if the lender is still using faxes to gather information rather than online platforms, several weeks can be lost while the lender checks to make sure all the needed documents have been collected.

Chase has a policy which makes this portion of the short sale truly shorter. Once the seller signs the listing agreement the short sale realtor can send all of the documentation to Chase. Once an offer is received and signed, you will be weeks ahead of the game.

So, if you are short selling your home with Chase be sure and ask your short sale realtor to send in your documents right away and save time when you get that offer!

If you have any questions about buying or selling short sales in Santa Clara or San Mateo County please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E. 01191194

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San Jose Distressed Properties Market Report

San Jose Single Family homes

Active Short Sale Listings:  371

Active Bank Owned Homes: 77

Pending Short Sale Homes: over 578 (mls stops counting at 500 and there are more than 500 San Jose Short Sales waiting for bank approval, 41 bank approved waiting for buyer to remove contingencies, and 338 just waiting to close)

Pending Bank Owned Homes: 127

Sold Short Sale Homes, Last 6 months 378

Sold Bank Owned Condos/Townhomes: 378

That is an amazing coincidence!


San Jose Condo Townhomes

Active Short Sale Listings: 166

Active Bank Owned Condos:  78

Pending Short Sale Condos/Townhomes: 578

Pending Bank Owned Condos/Townhomes: 104

Sold Short Sale Condos/Townhomes:  210

Sold Bank Owned Condos/Townhomes 314


So, if you add up all the short sale activity there are/were 2281+ for short sales and 1078 bank owned transactions.

My conclusion: even there has been a lot of press recently about how foreclosure filings are up in California right now short sales are dominating the distressed property market in the city of San Jose.

If you have any questions about short sales or foreclosures anywhere in Santa Clara or San Mateo Counties please feel free to contact me.

Marcy Moyer

Keller Williams Realty


D.R.E.  01191194


Marcy Moyer Keller Williams Realty Palo Alto, Ca. Specialist in Short Sales and Trust and Probate Sales

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When making an offer on a San Jose Short Sale it is common for the buyer's agent to ask the listing agent about his or her experience with short sales. They want to know if the seller's agent knows what he or she is doing because that is essential for a successful short sale completion. So when I am asked those questions I can honestly say that I am certified (CDPE), experienced, and successful.

But enough about me, what about you buyer's agent.  How many buyers have you ushered through the sometimes long and tedious process of a short sale? How many of your buyers have dropped out because they got tired of waiting or found something better? How many of your buyers really understand what "As-Is" means? How much do you understand about the process.

When I represent the buyer on a short sale I make sure they understand what is going to happen, how long it could take, and what will be expected of them.  I also make sure the buyer really wants that particular house, and is not just making lots of offers and willing to take the first one that gets approved.  

So if you are selling a San Jose Short Sale, ask your agent to talk to the buyer about their short sale experience and expectations before you sign that offer.

If you have any questions about buying or selling a short sale in San Mateo or Santa Clara Counties please feel free to contact me.

Marcy Moyer CDPE

Keller Williams Realty


D.R.E.  01191194

Marcy Moyer Keller Williams Realty Palo Alto, Ca. Specialist in Short Sales and Trust and Probate Sales

Read more…