Housing market optimists picked up another bullish datapoint this morning, as the National Association of Homebuilders (NAHB)/Wells Fargo builder confidence index rose to 16 from 14 last month. According to Bloomberg, that’s the highest reading since last September.

So what happened the last time builders felt this good about their prospects? Lehman Brothers went belly up, Washington Mutual and Wachovia collapsed into the arms of JP Morgan Chase and Wells Fargo, respectively, and the financial system nearly imploded. Sure, history is unlikely to repeat itself, but using this measure to try and predict the future is like trying to predict the weather 6 months in advance: An experiment in futility.

According to NAHB Chairman Joe Robson, “Builders are responding to what they perceive to be some of the best home buying conditions of a lifetime.” Here, Robson is echoing his sentiments from March and April, even as property values continue to fall.

Cirios Verdict: DEAL

San Francisco isn’t for everyone, but with the rental market still expensive relative to just about everywhere but New York, buying a condo or TIC (Tenant in Common) is a pretty viable option. It didn’t used to be, but low-end condo and TIC prices are falling, as overbuilding, lower rents and the general economic malaise is hitting developers where it hurts. No, not there. Their pockets.

As a result, some of the smaller units in older, renovated buildings are being offered at reasonable prices. To be sure, its likely they’ll keep getting cheaper, but some are starting to get interesting.

In particular, S1 listed on the CLEAR below is a lower unit in the same building, which sold for $440,000 after being listed at $410,000. And while we believe TIC and condo prices will keep sliding in the near term, prices will be supported as they come more in line with rents in the area.

Address: 3322 16th Street #6, San Francisco, CA 94114
Status: ACTIVE
List Date: 3/31/09
List Price: $469,000
Cirios Value: $485,000
List Price vs. Cirios Value: 3.4% under-listed.
For a complete Cirios Valuation, click here for our CLEAR report, or on the image to the right.

Have a home you’d like Cirios to use for our next House of the Week?
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A couple weeks ago, we highlighted 1660 Duvall Dr, San Jose, CA in our House of the Week. Our exact words: “This week’s house of the week redfines the term ‘over-listed.’ ”

Indeed. Listed at $665,000 we valued the property at $525,000 on 3/26/09 .

Then today, 4/14/09, the list price was dropped by more than 10% to $595,000. That’s a $70,000 drop for those keeping score at home.

Did they drop it far enough? We may soon find out …

Cirios Verdict: NO DEAL

This property is a well-maintained home in Mountain View, CA. Mountain View is home to Google, Yahoo and numerous other Internet and tech companies. Schools are good, crime is low and affordability, is, well, never mind. Prices, after holding up well relative to other parts of the Bay Area, are coming down. We are seeing buying activity in certain neighborhoods, as buyers look to pick up homes that were formerly out of their price range.

750 Telford Ave is in very good condition, although quite small for a 3 bedroom, 2 bathroom home. It is staged, very clean with well-manicured landscaping, which indicates that the agent is putting in a fair amount of effort to sell the home. Unfortunately it’s over-listed.

The subject’s immediate area is seeing very slow sales activity, while homes in other parts of town are seeing strong demand. This indicates that homes in the subject’s area are priced too high, and buyers are content to wait for prices to come down. Even though this property is one of the lowest priced homes in Mountain View, at its current list price, it is certainly not a deal.

Address: 750 Telford Ave, Mountain View, CA 94043
Status: LISTED
List Date: 2/25/2009
List Price: $668,000
Cirios Value: $600,000
List Price vs. Cirios Value: 10.2% over-listed

For a complete Cirios Valuation, click here for our CLEAR report, or on the image to the right.

Have a home you’d like Cirios to use for our next House of the Week?

Make a comment below!

We’re changing up the Cirios House of the Week a bit — we want to know whether you think this is a DEAL or NO-DEAL? In other words, would you buy this house at this price?

In our results post, we’ll tell you what we think.

This week’s house comes to you straight out of rough suburban streets of Mountain View, CA. Mountain View is centrally located in Silicon Valley, with a short commute to the likes of Google, Yahoo and other tech firms. Property values are falling, foreclosures are creeping upwards but the tree-lined streets of Mountain View remain desirable for many young professionals and families. (click on images to enlarge)

DEAL or NO DEAL?
Comment below and tell us what you think!

Address: 750 Telford Ave, Mountain View, CA 94043
Status: ACTIVE
Bedrooms: 3; Bathrooms: 2
Living Space: 1,104 square feet
Lot Size: 5,757
List Date: 2/25/2009
Original List Price: $668,000
Current List Price: $668,000
Average School API: 766
Zip Code Sales Last 3 Months (year-over-year): -43.0%
% Homes in Foreclosure in Zip: 0.43% (Low)
% Housing Inventory For Sale in Zip: 0.72% (Low)
MLS number: 80909740

Real Estate Agent Comment: Charming home w/lg living room featuring a wood-burning FP w/brick surround, hdwd flrs & open dining area. Open kit boasts ample counter/cab space and sep dining area. Wood-beam ceilings in bedrooms. Enclosed sunroom off kitchen leads to covered patio & large sunny backyard w/mature fruit trees. 2-car garage w/built-in storage.

This property is one of the many, many, many small condos for sale in Orange County. Santa Ana is centrally located next to what used to be the center of mortgage lending in this country, which has quickly turned into the center of a whole bunch of unoccupied commercial space.

All kidding aside, condos like this one are starting to make a lot of sense to buyers considering whether they should make the jump from renting to owning. This unit is nothing to write home about in terms of amenities, is not near the beach and the nearest Starbucks is more than a mile. That’s an eternity for Southern California.

But — at around $1000 per month after mortgage payments, insurance, taxes and HOA dues, it’s not a bad deal. The trouble, of course, is whether your $130,000 investment could quickly become a $100,000 investment, or worse. Sure, you may be paying less to own rather than rent — a market characteristic many cite as bottom-inducing — but if you’re losing $10,000 per year in equity, who cares?

This property is a short sale, and thus more complicated to buy than a foreclosure, and there’s a ton of similar supply nearby. That being said, activity is picking up as buyers are dipping their toes back into the market at new, lower prices.

Address: 2511 West Sunflower Ave, T15, Santa Ana, CA 92704
Status: ACTIVE
List Date: 3/14/2009
List Price: $139,000
Cirios Value: $130,000
List Price vs. Cirios Value: +6.9%

For a complete Cirios Valuation, click here for our CLEAR report, or on the image to the right.

Have a home you’d like Cirios to use for our next House of the Week?

Make a comment below!

This week’s House of the Week takes us down to the South Land, to Santa Ana and the land of endless strip malls and condo complexes. For under $1000 per month in mortgage, tax and insurance payments (assuming 20% down), you can be the proud owner of a 2 bedroom, 2 bathroom condo. The price: Just $139,000. (click images to enlarge)

Condos are cheap - but are they cheap enough? Sure, you can save a couple hundred bucks a month in rent, but is that worth it to risk owning a condo in a lousy real estate market?

WHAT WOULD YOU PAY FOR THIS HOME?
Post a comment below to guess!

Address: 2511 West Sunflower Ave. T15, Santa Ana, CA 92704
Status: ACTIVE
Bedrooms: 2; Bathrooms: 2
Living Space: 875 square feet
Lot Size: N/A
List Date: 3/14/2009
Original List Price: $139,000
Current List Price: $139,000
Average School API: 737
Zip Code Sales Last 3 Months (year-over-year): +166.0%
% Homes in Foreclosure in Zip: 4.6% (High)
% Housing Inventory For Sale in Zip: 1.1% (Moderate)

This week’s House of the Week redefines the term “over-listed.”

While the house does have a number of things going for it — large living area, good curb appeal and a nice open layout, it’s just priced too high. But, like many sellers in the area, this one is yet to come to terms with the reality that home prices have dropped, even in middle class areas with good schools. The home is bank owned, and the bank is getting lousy market information from the listing agent.

Schools are very good in this area, but the subject’s street — close to the local middle school — is a bit run down and has several other properties listed on the same block. While the other houses are inferior, the a buyer would still need to put a solid $15-20k into this house just to make it livable, not to mention the kitchen needs serious attention. This fact is not mentioned anywhere by the listing agent, who, based on the comment we mentioned in the original post, doesn’t even appear to have been to the property.

This is a story we see all too often: Banks listing properties too high, with barely attentive listing agents. Unless the seller drops the list price significantly, this house will sit on the market for a long, long time.
Address: 1660 Duvall Dr, San Jose, CA 95130
Status: ACTIVE
List Date: 2/9/2009
List Price: $665,000
Cirios Value: $525,000
List Price vs. Cirios Value: 21.1% over-listed

For a complete Cirios Valuation, click here for our CLEAR report, or on the image to the right.

Have a home you’d like Cirios to use for our next House of the Week?

Make a comment below!

This week, Cirios takes you on a quick jaunt down the Peninsula to San Jose.  The home is located in a middle-class suburban neighborhood with good schools. Pay special attention to the note from the listing agent — who has clearly gone all out to inspect the property prior to putting it on the market. (click in images to enlarge)

Home prices in this area are well down from the peak, but activity is picking up, as homes become affordable again. That being said, there’s still a large number of homes on the market, rising foreclosures and property values continue to fall.

Address: 1660 Duvall Dr, San Jose, CA 95130
Status: ACTIVE
Bedrooms: 4; Bathrooms: 3
Living Area: 1,716 square feet
Lot Size: 6,324 square feet
List Date: 2/9/2009
Original List Price: $665,000
Current List Price: $634,900
Elementary School API: 861
Zip Code Sales Last 3 Months: +8%
% Homes in Foreclosure in Zip: 0.47% (Low)
% Housing Inventory For Sale in Zip: 0.61% (Moderate)

Real Estate Agent Comment: Updated home with recessed lighting, tile floors, newer counter tops, Lazy Susan in the kitchen and a dual sinks in the master suite. Not a short sale! The information is provided by others and has not been verified by the seller or listing agent.

Ocean Beach, or OB, is located just north of the Point Loma Naval Base in San Diego. OB is about as far from Laguna Beach as a Southern California beach town could be. It’s grungy, dirty — it’s awesome. Apart from the main beach, where crowded, competitive SoCal surf is personified both off the pier and out at the Jetty, cliffs and quiet streets wind their way south, as the largest kelp forest in the world (yes, the world) hangs around just off shore.

Northern OB is home to small houses and apartment complexes, about as cheap as you can find a few blocks from the beach. Head south or up the hill and the homes get progressively larger, more expensive and the median age of the inhabitants rises in kind.

Our subject is a new home, built in 2008, with a small lot as a result of a lot split. MLS denotes the home a condo, but it is much more of a cottage than a true condo. There aren’t a ton of true single families around the subject, as the area is spattered with apartments and condos. This makes the subject desirable, if small. However, the market for small homes and condos is very slow right now in OB — lots on the market, not much selling. Prices are falling. REOs are inching upwards, further hurting property values.

The list price of $625,000 is aggressive, but based on the price the builder likely paid for the land, the cost of the tear-down and the lot split, plus the new construction, he or she probably doesn’t have a lot of room to lower the price and still make money. It will be very telling to watch if, and when, the owner bites the bullet.

Address: 4844 Coronado Ave, San Diego, CA 92107
Status: ACTIVE
List Date: 11/10/2008
List Price: $625,000
Cirios Value: $550,000
List Price vs. Cirios Value: 12.0% over-listed

For a complete Cirios Valuation, click here for our CLEAR report, or on the image to the right.

Comments? Have a home you’d like Cirios to use for our next House of the Week?