The following Contra Costa Times article chronicles one couple’s experience attempting to purchase a bank owned home. While their experience is on the extreme side, it is not entirely unheard of. In fact with inventory as low as it is in the East Bay Counties of Alameda and Contra Costa, and with many people out trying to purchase a home we are seeing bank owned homes to be more hassle than they are worth. When out looking at homes to buy it is very important that you educate yourself on the current market and what it will take to purchase a home these days. At least for now bank owned homes are not the bargain that people would expect. I would like to hear your opinions on this subject.
2010
The real estate market in Alamo has consistently lagged the markets in Danville and San Ramon but is similar in many ways.
What we are seeing with both Danville real estate sales and San Ramon real estate sales is a segmented market. While there are many homes selling with multiple offers and at prices “Over List”, there is a whole segment of active listings just sitting. The Alamo real estate market, exhibits this same condition. In fact we are seeing this in both Contra Costa and Alameda counties as a whole. Basically it boils down to price per square foot. In Alamo there are currently 75 active homes on the market and 26 pending. The main difference between Active and Pending is average price per square foot. For the active homes, the average price per square foot is at $432 while the pending is at $341. If you look at the average days on market between the two groups you see that the active on average have been on the market for 148 days while the pending are at 82 days. So the message is that in order to sell, even in these times of low inventory, you will need to be aggressive with price. I recommend pricing your home under comparable sales by 2-3%. this should generate some activity.
Current Alamo Real Estate Statistics:
There are 75 active single family detached homes currently on the market in Alamo. The average list price for these homes is $2,199,683 with the highest priced listing at $38,000,000 and the lowest at $625,000. the average price per square foot is at $432 and the average days on market at 148. There are 25 pending sales on the market with an average list price of $1,074,458. The highest priced pending sale is listed at $2,345,000 and the lowest at $625,000. The average price per square foot is at $341 and the average days on market is at 82 days.
The current statistics for single family detached homes in San Ramon show a very definite sellers market, so why are many homes not selling?
The current inventory absorption rate in San Ramon is at .3 months, which is about 1 week. This means that on average if no other homes were listed all of the available inventory would be sold in 1 week. What is interesting is that the average days on market for the 48 active homes is at 103 days, Why? You really need to look at the prices of the homes that are actually selling. The average price per square foot for the active listings is at $454 with an average list price of $963,191. When you compare these figures to those of the Pending sales the difference is staggering. The average price per square foot for the 156 pending sales of single family detached homes in San Ramon is at $292 with an average list price of $776,064. What this means is that buyers are jumping on the homes with perceived “Value” pricing. Interestingly enough many of the lower priced homes are seeing multiple offers and are actually selling well above the low asking price. I am not recommending that people put Lowball prices on their listings but I do recommend that people price their homes competitively and even price their homes to sell at 2-3 percent below comparable sales. This strategy should provide a much higher level of activity.
Current statistics for San Ramon real estate:
There are 48 active listings in San Ramon with an average list price of $963,191. The highest priced listing is at $4,990,000 and the lowest at $354,000. The avereage price per square foot is at $454 and the average days on market at 103 days. There are 156 pending sales in San Ramon with an average list price of $776,064. the highest priced pending sale is listed at $1,798,000 and the lowest at $315,000. The average price per square foot for these pending sales is at $292 and the average days on market of 37.
The inventory absorption rate in the Town of Danville for single family detached homes is continuing to drop and is now at 1.2 months. So why are some homes just sitting?
When looking at the most recent statistics for Danville homes we see that there are some very distinct differences between homes that are selling and those that are not. In general if you just look at the price per square foot for Pending homes compared to Active listing you will see that the active properties are listed at an average $125 per square foot higher. This is significant. What this means is that the Danville buyers are still looking for value. In fact we are seeing many of the listings that are new to the market actually being listed below recent comparable sales in order to generate more activity and more offers. This is reminiscent to the market of 2005 where homes were listed low and ended up with many offers and a final sales price actually higher than comparable sales. This does not mean that I am suggesting that people list there homes well below comparable sales but being 1-2 percent below the last sale will most certainly generate more activity than the strategy of listing over comparable sales.
Current Danville Real Estate statistics:
Currently there are 89 active listings for single family detached homes in Danville. The average list price is $1,282,098 with the highest priced listing at $3,498,000 and the lowest priced at $475,000. The average price per square foot for these homes is at $443 with the average days on market of 115 days. There are 74 pending sales in Danville with an average list price of $909,172. The highest priced pending is listed at $2,395,000 and and the lowest at $449,000. The average price per square foot for these pending sales is at $318 and the average days on market is 66 days.
The Danville Real Estate Market as well as San Ramon, Alamo, and the entire Bay Area is virtually unrecognizable from the market we experienced just one year ago. At the low to mid price points, as a result of low inventory, low interest rates, and Buyer Incentives, we find a very strong sellers market. In order to successfully purchase a home in this challenging market you really need to arm yourself with the most recent and relevant strategies for buying homes. This video will discuss what it takes to buy a home today.
In the following CNN Money.com article the author predicts, in spite of the increase in sales prices and sales for 2009, thatDanville, Alamo, andSan Ramon real estate prices will experience a decline during 2010 with an increase in 2011. The article points to the enormous number of potential foreclosures, the elimination of the feds policy on trading Mortgage Backed Securities, and the expiration of the First Time Home Buyer Tax Credit as reasons that there will be fewer buyers and more inventory in 2010.
Note: If you are someone considering selling your home, this article will be very important to you. if the author is correct, then you have a small window to get your home sold during the first quarter of 2010.
