Our low inventory has buyers starved for houses to purchase. When they see a good one, they react immediately – an attractively-priced house will have people driving by within the first hour or two on the market!
Sellers should be aware, and expect to sell their house right away.
Those who don’t shine up their house before listing, or those who get exuberant about price – thinking they have plenty of time – will miss a golden opportunity. The most desperate buyers are motivated to pay top dollar in the first few days on the market!
Here are the number of NSDCC houses sold up to $1,400,000 in the first quarter, ranked by days-on-market:
Avg DOM
2013 #/SP:LP
2014 #/SP:LP
2015 #/SP:LP
2016 #/SP:LP
0
19/97.0%
8/98.2%
6/91.9%
9/97.4%
1-14
205/99.5%
169/99.4%
160/98.6%
125/99.3%
15-30
80/97.2%
58/97.7%
65/96.7%
64/97.7%
31-60
68/96.5%
78/96.5%
83/96.7%
72/97.0%
61+
157/95.5%
96//94.8%
104/96.1%
89/95.9%
Sellers – you want to get your price, right?
The houses that sell closest to list price are those that go pending in the first two weeks. These SP:LP ratios are based on the list price on the pending date – the price which typically needs to be lowered first to get a buyer to offer, because they know it isn’t working after the first few weeks.
Hire a listing agent who can handle the immediate urgency – Get Good Help!
We will examine it in a few ways – first let’s just check the sales count and MSP.
The sales that record today, plus the late-reporters, will increase the 2016 count, but we’re probably not going to get close to the 2015 number of sales, nor the median sales price. This should be a common dilemma with 2016 stats – 2015 was so good, it will be hard to match it this year.
NSDCC 1st Quarter Stats
Year
Number of 1Q Sales
Median Sales Price
2011
553
$835,000
2012
577
$793,000
2013
672
$850,000
2014
581
$1,000,000
2015
629
$1,162,500
2016
532
$1,126,500
We will sell a similar number of houses this quarter as we did in 1Q12, when the median sales price was 42% lower.
The resilience is strong – people want a coastal house!
Yesterday another one of the more famous ivory-tower guys made an interesting statement:
“The low inventory of homes for sale — currently about a five-month supply — means that would-be sellers seeking to trade up are having a hard time finding a new, larger home,” said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.
As is the case with most of these random quotes, there is no reference cited for the comment. He’s just making stuff up.
Sellers who are ‘seeking to trade up’ are having the easier time of it, and the inventory gets more bloated the higher you go.
It is the potential sellers who are thinking of moving DOWN that are reluctant to enter the market. Why?
It is brutal trying to move down comfortably, especially if you want to use the proceeds from the sale of your more-expensive home!
The lower you go, the hotter it gets!
Here are today’s 2016 stats for NSDCC houses (La Jolla to Carlsbad):
Category
Under-$1,400,000
Over-$1,400,000
Active Listings
238
697
Pending Listings
259
163
Sold in 2016
348
172
Solds Avg Days on Market
45
57
SP:LP
97.6%
93.9%
The $1,400,000 mark is what we’ve seen to be the max sweet spot for the hottest markets. Below that price today, there are more pendings that actives!
Can we put to rest the old adage that it takes longer to sell the more-expensive homes in this hyper-era? On average, we’re talking 12 more days, yet how many high-enders do you see languishing on the market for months or years just thinking that it takes more time?
Blitzy and other ivory-tower types should plug in – has there ever been a better time to move up? Jumbo rates are below conforming rates, there are more houses for sale and the pace is slower. It’s a great time to buy up!
We’ve all heard the rule about listing your home for sale in the spring.
But when are buyers actually buying?
Are there any times when the demand could wane, and sellers should avoid?
There are three events that could cause a lull in the demand:
Easter/Spring Break
Tax Day/Season
Graduation Season
If all we had to worry about was Easter Day, then we might lose a few hours – there were plenty of open houses on Saturday. But families with school-age kids get 9-10 days off, which is tempting for them to spend on vacation.
Should sellers wait?
Then you have the tax-day slowdown, which is usually the 1-2 days that people waste having to arm-wrestle with their income taxes.
Keep waiting?
Graduation season is more than it used to be, with every kid from pre-school through college getting the pomp and circumstance fit for a king.
Good grief – it will be mid-summer by the time every distraction clears!
Let’s examine the most important fact – when are buyers buying?
These intervals below were based on the hunch that the combined spring-break/tax-day season (3/16-4/15) might show some weakness:
NSDCC Detached-Home Closed Sales – Dates They Were Marked Pending:
Year
2/16-3/15
3/16-4/15
4/16-5/15
5/16-6/15
7/16-8/15
2012
264
297
309
307
231
2013
293
362
340
326
248
2014
231
271
303
261
264
2015
264
318
308
311
289
Avg
263
312
315
301
258
How about that!
The spring-break/tax-day season was the hottest of the year in 2015, and on average about as good of a time to sell as any!
The couple is looking for a home under $2 million, but they’ve found little suitable near a good public school. They’ve put in only two offers in the roughly six months they’ve been looking — and were unsuccessful both times.
This month, Lee, 32, went to a packed open house for a four-bedroom house in north Redondo Beach. It was so busy that the real estate agent ran out of fliers. She put in an offer for more than the $1-million asking price but lost. Instead, the home went into escrow to another buyer, less than a week after it was listed for sale.
In such a hot market, would-be sellers are conflicted about whether to cash in now or wait for prices to rise further. Some have begun to question how long the hot market can last.
“They think we are due for a correction,” said Nikki Hochstein, an agent who specializes in the Westside and is helping the Lees find a home.
On a recent Sunday, about 150 people flocked to a three-bedroom condo in West L.A. for an open house, agent Tregg Rustad said.
Among the interested buyers were Sameena Shaikh, a medical researcher, and her husband, Muddassar, who works as a software engineer in Santa Monica.
The couple have been searching for a home for about a year but haven’t pulled the trigger. In that time, they’ve seen prices rise and now fear mortgage rates will jump. As they surveyed the packed open house they vowed to be less picky.
“We don’t want to make the same mistake,” Sameena said.
Muddassar explained their new tactic: “Let’s just buy something.”
The NAR pending index for February was released today, and it was modestly positive. In the West, it was the best non-seasonally-adjusted number since October. But who cares – April starts on Friday!
“Any further moderation in prices would be a welcome development this spring,” adds Yun. “Particularly in the West, where it appears a segment of would-be buyers are becoming wary of high asking prices and stiff competition.”
New NSDCC pendings were down 15% this week, but the market can wane a bit around spring break. Or does it? More on that later today!
Click on the ‘Read More’ link below for the NSDCC active-inventory data:
