Hello Everyone,
(for access to spreadsheets, please see http://www.fredanlyan.com )
It is good to be back in Marin, where I have spent the week talking with agents and lenders about their opinions on the current state of the local real estate market. "Make sure you tell them about the multiple offers" excalimed one prominent agent referring to the three offers and quick close on a recent listing. A leading Marin County mortgage broker assured me that they have never failed to to obtain a loan for a well-qualified client. The lenders are just making them jump through a few more hoops now. Agents tell me the market is active, and the REO's are selling as lenders do what is necessary to get these non-performing "assets" off their books. But they also tell me many buyers are circling, waiting to get the perfect deal, or waiting for the market to go lower. From the point of view of an agent, it is surprising that every bit of inventory is not flying off the shelf. So rarely is it that prices in Marin go down, that this seems an opportunity not to be missed. But last week, the gap in YTD unit sales between 2007 and 2008 increased again for both condo's and SFR's (both down 37%). YTD average sold prices on condo's are down about 6.8% vs this time in 2007, and average ytd sold prices for SFR's down about 1.9%. My economics professor told me that the market is always right, and I can't argue with that. But there is such a thing as waiting too long. We will not recognize the bottom of the market until we have passed it. Smart buyers and investors try to find good deals rather than market bottoms, and there are certainly many good deals out there now. Many sellers of homes on the market over 30 days have not reduced their asking prices but would be willing to negotiate on reasonable offers from qualified buyers.
Inventory is up again for both SFR's and condo's, and percentage in contract continues to advance as well. SFR's in the $1million to $1.99 million range finally made it to "balanced" this week, at slightly over 25% in contract. SFR percentages in contract all increased, with the exception of the $2million to $2.99 million range, which dropped less than 1 point. Condominium percentage in contract also up, except in the $1million to $1.99 million range, and that reduction hinged on the sale of only one unit.
Tremendous opportunity in this market. Ask your real estate professional for the city by city average sold prices back to 1965, and see for yourself!
More next week.
Until then, good luck and best wishes,
Fred
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