Micro Markets

I just had an interesting conversation with a home buyer on trulia.com voices. 

Trulia Roger:
What’s the oulook for the housing market in the Bay Area for the next 2 years?
I’m thinking of buying a property near (but not in) San Francisco soonish (some time in the next 3 years). I’m seeing prices drop, foreclosures rise, inventory stagnate, buyers stall, and sellers despair. What do you folks think the outlook is for the next year or so?
Me: 
I think you have to get very specific about the area you’re referring to. “Bay Area” is too broad. I work on the Peninsula – not in SF. 

On the Coast, in general, it is taking longer than it has in the recent past for homes to sell. However, that’s not true on the Peninsula of San Mateo County. There are multiple offers; homes are selling over the asking price.

Like I said, I don’t work the SF market; however, I’m hearing from my peers that that market is extremely competative. Multiple offers are far over the asking price, as in 50k to 150k+.

I’m seeing short sales; but many of those are receiving multiple offers. Prices are not rising as fast as they were, but still are climbing. Homes are taking longer to sell, but not to the point of stagnating.

To answer your question specifically, I expect that those trends will continue.

Land is at a premium; the weather is superior; new construction is very limited; major companies continue to hire. The population still grows faster than the housing available.

Basically, I’m not seeing what you describe.

Would you post the city where you’re seeing these things? I’d be really interested in running statistics.

Trulia Roger:
Hi Vicki, 

Thanks for the answer. Alameda is the market I watch very closely.

In the past year, I don’t believe I have seen a single property sell for over asking, and multiple price drops are common. One gorgeous property listed at $629K in early 2006 sold for $542K after languishing on the market for 4 months with no offers.

Another extraordinary Victorian started over $800K, fell out of escrow, was relisted at $799K, fell out of escrow again, and sold for $715K 4 months after being relisted.

Condos take months to sell after multiple price drops, when just 2 years ago they were being snapped up for significantly more than the list price, with bidding wars all over the island.

I’m watching this market obsessively and have most of the listings memorized… I’m just not seeing any of the crazy prices and bidding wars we used to see just 2 years

ago.
One more thing–I overheard a very experienced local agent discussing the market with a colleague and he said (this is a quote) “Things are going south here fast.” …
Me:
Got it. I’m aware that that is the situation in some places around the country, didn’t know it was happening in Alameda. Wow. We have microclimates and micro real estate markets.
Vicki Moore About Vicki Moore

Office:
RE/MAX Star Properties
282 Redwood Shores Parkway
Redwood Shores, CA 94065

By Phone:
650.888.9268

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