The presidential election is less than 60 days away and even if one of the candidates is a clear winner at Tuesday’s debate, the fight will get nasty from here on out.
The distraction is likely to cause potential home buyers to want to wait-and-see. Thankfully, the hope of lower mortgage rates will keep more than just the bottom-feeders in the game – but the serious buyers will have to dig out a deal, because the sellers are being tough on price. Why? They have comps!
It was noted earlier how the market shifted in the middle of May.
In the last 90 days, there have been 531 closed sales between La Jolla and Carlsbad. Their stats:
Median LP: $2,399,000
Median SP: $2,370,000
Median Days on Market: 14
Any casual observer will quickly conclude that the market looks to be in fine shape.
Just the fact that there have been 531 sales sounds pretty good!
But it is easy to miss. What can we learn from the active (unsold) listings?
To derive some conclusions about the overall market conditions, let’s examine the 83 actives priced under $5,000,000 that have been on the market for more than 60 days. After they have been on the market for 2-3 weeks, the showings dwindle down to zero or close, so the market is talking if they’re listening and want to do something about it.
Of the 83, there are 26 who haven’t lowered their price, and three that have raised their price! That’s 35% whose motivation is so low that they’re going to wait until the right buyers come along.
For the most part, those who have lowered their price didn’t do much. We are now in the post-summer soft-and-getting-softer environment, so a meaningful price reduction needs to be 10% or more to get anyone’s attention. Here are samples of the current NSDCC active listings:
Those who have dumped more than 10% and are still unsold are asking themselves, ‘what’s it going to take?’. We just saw that 20% of last month’s sales were still closing OVER their list price – what gives?
The difference is the condition of the home.
The most amazing frenzy of all-time lasted for two years and spoiled everyone. Not only did homes not need to be fixed up much, but the pricing could be sloppy too and yet virtually every house was selling. There were times when 70% to 80% of the homes sold were closing over their list price!
We’ve had an astounding change of market conditions in a relatively short period of time to think that we went from that 70% to 80% to now 20% or less closing over list. It means those 20% are the really spectacular buys, and those seemingly premium listings now need to have aggressive pricing and/or be substantially improved recently to have a shot at getting their price.
Sellers need to be doing everything better. Do more improvements (especially on curb appeal), better staging, premium photography/video, more-attractive pricing, and hire the best agent you can find!
How do you know about the agent? They are talking about the shift, and what to do about it!
Get Good Help!
