"The housing market is still in holiday siesta mode. Listing inventory
increased as sellers begin to put their homes on the market for the
fall. The buyers are out there as evidenced by their attendance at open
homes. First time open houses attract the majority of buyers looking
for the “right home” (meaning priced well and in perfect shape).
A new Berkeley listing under $700.000 was visited by 42 groups of buyers.
"The media still continues to hammer the housing market---trying
to look for every negative shred of evidence that the housing market
has tanked. In spite of their efforts—many smart buyers know this
is an excellent time to buy---more choice, a break in interest rates
as they continue to come done and a environment conducive to negotiations.
Still 30 % of our offices received multiple offers—20% at the 30%
plus level. Down a bit from previous weeks, but still indicating good
homes go quickly. With that said, there are still a majority of sellers
who have not adjusted to the new reality---homes are not going up with
double digit appreciation. Homes in today’s market are either flat
from last year or slightly lower (10% or less). Sellers need to remember
that prices went up 50% plus from 2003-2005. A small reduction from
the highs of last year still leaves outstanding returns, as real estate
is a leveraged investment. The gains are substantial and well beyond
any other asset class.
"We are seeing an increase among buyers wanting to renegotiate
offers during the escrow period, especially after inspections. This
is why it is important for sellers to have pre-sale reports so that
buyers can make offers based on the condition of the home. This can
prevent unnecessary fall out. Sellers should also take care of any deferred
maintenance which also helps prevent reasons for renegotiation.
"Believe it or not aggressively priced properties are attracting
buyers in droves. A Parkside listing in San Francisco received 42 offers---sounds
like 2005. What it means is that buyers are ready to leap when they
see an outstanding value. Some buyers have a challenging time of it
understanding that properties can receive multiple offers---they believe
everything they read in the media about the bubble bursting. This is
not the case in markets that have smaller inventories----like the buyer
who lost in a multiple offer presentation in Burlingame found out the
hard way.. He couldn’t understand why his offer was outbid. The
reason is that the SF/Bay Area is a highly attractive place to live
and certain areas, no matter what is happening in the general market,
their desirability increases value of properties in spite of the transitional
market.
"Here are the numbers for the week: 12 offices saw increasing
inventories, 13 steady and 6 decreasing----4 offices reported increasing
sales activity, 19 steady and 8 decreasing."
Avram Goldman
President and COO
Coldwell Banker SF/Bay Area
