Pricey listings flock together in cities like San Francisco and San Jose; the low square footage factor.
In some parts of the country, $1 million buys a starter home.
Nationwide, 4.6% of homes are priced at $1 million and above, according to an analysis of home listings by real-estate website Trulia.
In San Francisco, a whopping 43.5% of listings are priced at $1 million and above. Fairfield County, Conn., ranks second, with 29.7% of homes listed over $1 million, followed by San Jose, Calif., with 25.7% of listings topping the million-dollar mark.
“In terms of million-dollar listings, there has been a huge, huge influx,” says Paul Ybarbo, an agent with Sotheby’s International Realty in San Francisco. “If you’re in a nice neighborhood and live in a nice building, it most likely will command a million-dollar price point.”
According to Trulia, San Francisco homes listed for roughly $1 million have a median size of 1,774 square feet, but can be much smaller. Mr. Ybarbo has a $1.15 million listing, currently under contract, for a one-bedroom apartment in Nob Hill that measures just over 1,000 square feet.
Do the million-dollar listings translate to million-dollar sales? Typically, homes that sold for more than $1 million made up 1% of total U.S. home sales for the past decade. Since mid-2013, that number has risen to 2% of all sales, says Sam Khater, deputy chief economist at CoreLogic, CLGX -1.27% which specializes in mortgage and real-estate information. He expects the percentage of million-dollar sales to continue increasing so long as the stock market continues to improve and interest rates remain low.
Mr. Khater points out that two of the top three locations for high-price listings—San Francisco and San Jose—have thriving tech industries. “That says a lot about the changing nature of the economy,” he says.
The spread between markets in the share of million-dollar listings is much larger than the spread in other home-price measures, like price per square foot, says Jed Kolko, chief economist and head of analytics at Trulia. “The prevalence of million-dollar listings shows how different the markets are at the extreme high end,” he says. “Million-dollar listings are 50 times more common on Long Island [New York] than in Rochester, even though the median price per square foot is only 2.5 times higher.”
Stocks drifted lower Wednesday as investors tried to make sense of better-than expected economic reports and gauge the mindset of the Federal Reserve. The Dow Jones Industrial Average, S&P 500, and the Nasdaq were all down slightly in afternoon trading, erasing previous gains. In its Beige Book report on regional economic activity, the Fed said the economy expanded at a “modest to moderate pace” from early October to mid-November.
It noted gains in the auto and high-tech industries and reported that retailers are “hopeful, but cautious” about the holiday shopping season. Investors remain fixated on clues as to when the Fed might pull back, or taper, it’s $85 billion per month bond buying program.
The three indexes were in the green earlier Wednesday after the Census Bureau said sales of new single family residential homes rose 25% in October compared to September, topping economists’ expectations.
That report came after payroll processor ADP (ADP, Fortune 500) reported that 215,000 private-sector jobs were added in November — well above the 160,000 gain that was expected.
Bond investors stayed focused on when the Fed might taper. The yield on the 10-year Treasury note spiked to 2.85% Wednesday, near the year’s high of almost 3% back in September. At that time, investors feared the Fed would taper at its meeting in September. It didn’t. But some experts believe that the Fed could now announce it is pulling back on stimulus at the conclusion of its next meeting on December 18.
In corporate news, J.C. Penney (JCP, Fortune 500) said Tuesday that same-store sales in November grew 10% from the same period last year. The stock, which has been the worst performer on the S&P 500 this year, is in the midst of a turnaround and has caught the attention of some major hedge funds.
But investors seemed unimpressed with the decent November sales. Shares of J.C. Penney were down about 4%. Despite that, one trader on StockTwits was bullish that it would bounce back by the end of the day.
$JCP green by close,” said Jason100. Others were optimistic, but acknowledged it’s a difficult trade.
“$JCP only patient ppl or idiots can win this stock LOL”, said Smellyegg.
Shares of Deere (DE, Fortune 500) jumped over 3% after the agricultural machinery giant announced it boosted its share repurchase program.
“Stopped out of $DE ystdy after holding for 2 weeks & today they announce buyback” said Sspencer_smb, a StockTwits trader who worried he missed out on the stock’s recent move. Another mover was Hewlett-Packard (HPQ, Fortune 500), which rose more than 3% after reports that the PC and printer maker plans to shed 1,100 jobs in its U.K. unit.
StockTwits trader Shaggyeleven was not buying the stock for now, but is keeping a close eye on it. “$HPQ not in, watching, if keeps moving like this, thinking, I’m missing something.” Also trending on StockTwits: Apple (AAPL, Fortune 500). Shares of the iPad maker have surged back to life in recent months, gaining almost 50% from its 52-week low earlier this year. Activist investor Carl Icahn reiterated in an interview with Time Wednesday that he wants the company to buy back more of its stock.
“$AAPL slow and steady rise the rest of the day” said trader ChazMac09.
European markets slid in afternoon trading, shrugging off the final purchasing managers’ data for November that came in a little better than expected. The European Union levied a record antitrust fine of €1.7 billion ($2.3 billion) on six European and U.S. banks and brokers for rigging benchmark interest rates. The largest fine, of €725 million ($986 million) went to Deutsche Bank (DB).
A beautiful 50-acre estate in the heart of the Berkshires has one unique feature: a luxurious, heated, self-cleaning pool that was converted from an old limestone rock quarry.
40,000 archeological artifacts were found along the way, but Turkey and Japan finally finished building its massive Marmaray tunnel that connects two parts of Istanbul.
Being thankful can save money and achieve goals, so why wait until Thanksgiving Day to adopt a proactive attitude?
At Thanksgiving, we stop whining about what we don’t have and stop obsessing about what others have to consciously acknowledge things we’re thankful for. The shift to appreciation from envy turns this popular holiday into a feel-good celebration of what has been accomplished.
Those who honestly assess their genuine lifestyle needs and what they have actually accomplished, specifically regarding real estate, usually discover they are better off than they thought. Often they discover that the push to spend more money and acquire more stuff is driven, not by real need, but by the marketing deluge that hits us almost 24-7 on every screen and device we give our attention to. For instance, how did you discover you had to have granite counters, stainless-steel appliances, and +12-foot ceilings? Was it through experience or because of marketing? Have you stopped to consider the expensive down-side of these and other “must haves”? As well as paying more for these features, you’re taking on high-maintenance trimmings that may eventually become as dated as avocado appliances and popcorn ceilings.
Just as we often do when considering ourselves, we obsess on apparent flaws and shortcomings in our property. “The grass is always greener” thinking has us comparing what may or may not make sense financially for our home to what’s standard in over-the-top celebrity homes and price-is-no-object, made-for-TV renovations.
Start being thankful now, especially if you are in the process of buying or selling real estate, and you may discover how to save money and achieve financial goals that are yours, not those marketing campaigns have convinced you to adopt.
- Media emphasis on “underwater mortgages”- where the outstanding mortgage balance is at or above the property value – can make owners personally devalue the real estate that would otherwise give them pleasure and comfort. Mortgages represent the cost of borrowing money not the cost of real estate since those who don’t need financing escape this cost. In hindsight, you might not want to buy what you did or at least the way that you did, but don’t let how you bought your home taint your appreciation of this roof over your head and place of belonging for you and your family. Make attacking that mortgage a separate issue.
- You’ll save money on a few levels at once by buying real estate within a realistic budget, which includes making do with some less-than-perfect aspects of the property, instead of diving into “go for broke” renovations. For instance, many of the “must-change” reactions buyers have to their new home disappear once they live in the space a while. This live-with-it-for-now experience reveals to these new homeowners how to achieve more with less.
- Black Friday is just the beginning of the “make shoppers shop” season. Listen to the siren call of shopping malls and online click-here sales and you’ve got some expensive weeks ahead. Take stock of how much debt you built up last year between Thanksgiving and early January and you’ll begin to see how much money you could apply to mortgage debt or put toward the down payment on a new home if you just rein in spending. Be thankful for debt you have avoided and you’ll get creative about how to enjoy the holidays and achieve real estate goals in the process. You may also discover more space and storage in your home if you decide to stop buying new things until you de-clutter. Maybe your condo or house is not too small, you just need a lesson in letting go and spending wisely.
- Learn to separate what you genuinely need from what you think you want. When confronted with a buying decision stop and consider, “Do I really need it?”Take charge by being thankful for what you have. This makes it easy to take a close look at what you think you still need to spend on. If you don’t take an active role in how effectively your money is spent and on what, you’re letting marketers decide what you buy and how much you pay for everything, including real estate.