By Eric Castongia, Zephyr Real Estate
In my year-end article last January, I wondered if, in 2010, we would bounce back to our expected number of sales-we did. We did not, however, see an increase of property values. In the end we had overall stability in terms of values and the number of expected sales, despite all the drama of the market occurring behind the scenes. Here’s what happened:
- The total number of sales for 2010 was 51, up from 2009’s 38, and in line with 2008’s 54 sales. Total annual sales since I started recording in 2004, have ranged between 52 and 60 each year, except for 2007 and 2009-so, for this year, we seem to be back in expected territory in terms of the number of sales.
- As for ‘failed to sell listings’, in 2010, we had a total of 11 (18% of sold and failed to sell listings) and in 2009 we had 13 (25%).
- Looking at sales in the 4th quarter of 2010, only one of 12 sales (.8%) sold over the asking price, with nine selling under (75%). In the 3rd quarter, seven of the 13 sales (54%) sold for more than list with five selling under (38%). In the 4th quarter of 2009, there were nine sales, three of them sold over list (33%) and five sold under (56%). These numbers indicate a slow down in activity in the fourth quarter. Inventory and activity were higher in the third quarter, yet both were down in the fourth quarter-prices remained stable. It seems to me we had our Fall burst of energy a little earlier this year.
- More properties sold and sellers were willing to negotiate.
- Interest rates have remained historically low, but have seen an uptick over the past two months. I expect this to push some buyers off the fence in the new year, as purchasing power goes down with each rise in interest rates.
- Lending is still tight and easier for those with verifiable income and good credit scores.
- Historically, we see a healthy supply of listings coming onto the market in January-April. The challenge we have run into over the past few years, is that the inventory coming on doesn’t necessarily match the buyers in the marketplace-creating a supply and demand issue. This may explain why some listings are getting multiple offers over asking and others are lingering on the market and selling below their asking price.
- Most of the loss of value we experienced occurred in 2008 and the beginning of 2009. I think the real estate values flirted with the bottom of the market mid-2009. Since that time, our neighborhood seems to be stable overall. In my interpolation, I think we have stayed even in terms of values over the course of 2010.
- While, I feel rumblings that more buyers are starting to poke around in preparation to buy in 2011, I do not expect the extra buyers to push prices up too much in the short term. Sellers still need to consider this a buyers’ market.
Eric Castongia, Residential Sales Specialist at Zephyr Real Estate provided the information in this article. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service and Eric’s observations in the marketplace. Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.