Some Markets Get a Summer Boost in Available Homes for Sale

By Gino Blefari, President & CEO, Intero Real Estate Services, Inc.

Remember that much-needed housing inventory we've been discussing here? It's raising its head above the fold.

The number of homes listed for sale nationwide climbed 4.3% in June to 1.9 million homes, according to data in the Wall Street Journal pulled this week from Realtor.com. It was the highest level we've seen in a year.

Does this mean we're over the hump? Potentially.

Even with the improvement in monthly gains, inventory levels continue to be below year-ago comparisons. The number of homes listed for sale nationwide in June was 7.3% below levels of last year. But note the improvement from February, when inventories were 18.6% below the year before.

Inventories were up in 20 cities in June compared to May, with a notable spike in Southern California where available home listings jumped 51.5% in Orange County, 45.7% in Los Angeles, and 18.1% in San Diego.

The data pointed out four markets of the nation's largest 30 where the number of listings was above last year's levels. They were: Sacramento (up 11%), Atlanta (up 10.9%), Phoenix (up 6.2%), and Miami (2.2%).

On the opposite end of the spectrum, five cities had inventory levels that were well below last year's levels, including Boston (down 35.1%), Denver (down 30.1%), Detroit (down 25.7%), Seattle (down 23.2%), and San Francisco (down 21.7%).

The falling numbers in these cities isn't a good sign for buyers. Markets will continue to be tight, at least in the short term, as demand remains high. We may see further price increases as a result.

On the other side, however, a tightened supply and healthy demand could help more homeowners in these markets jump off the fence and list their homes for sale if they've been waiting for more signs the market is back.

It's a tough balancing act. But all in all, inventories appear to have reversed their freefall in some markets, while continuing to be scarce in others. As with all things real estate, it's all about location. That's why it's always so difficult to answer the question everyone wants to ask, "How's the market?"

Stay tuned as we continue to watch these numbers closely.

July Newsletter Hot of the Presses

We have a monthly newsletter that we are no longer printing and snail mailing. It’s all electronic, all the time. Here’s our July issue that we hope you enjoy.

http://teampatereau.files.wordpress.com/2013/07/over-the-fence-july-2013.pdf

Shifting Gears in Today's Real Estate Market

Real estate transactions aren’t like they used to be 20 years ago. Or 10 years ago. Or even 3 years ago. Today’s sellers often list their property slightly under the current market value, which encourages interest and activity and brings in multiple offers, many times over list price, and many time over the current market value. It’s a strategy that can be used on certain properties.

Conversely, today’s buyers need to make offers at list price or over, depending on the property and their Realtor’s advice. Buyers aren’t at all comfortable doing that. Sometimes they fire the agent who suggest an over-list-price offer and head out to find an agent who will do it their way. We’ve had that happen. That couple still doesn’t own a home, and they’re thinking about firing the second agent.

This article, about conditions in Washington, D.C., reflects conditions right here in Gilroy, and the surrounding area. Read the article, and know that if you are selling or buying, you have to go by the current conditions, which your local Realtor will know. Trust them.

Market Conditions

In Gilroy there are pleanty of houses for sale - still. BUT, there are a lot of properties going into contract! The other but is that the escrows are taking an extraordinary long time because lenders are scrutinizing new loans and borrowers at an unprecedented degree.

There's an odd thing going on, too. Homes owned by banks and other financial institutions are going on the market at really reasonable prices. Once on the market they are receiving multiple offers, and are ultimately going into contract at over list price. We had one buyer offer competing with 22 other offers last week. The winner went in with an over-list-price offer, and raised it even more on counter.

News on the national level includes the National Association of Realtors reporting this week that there have been pending home sale gains in the South and Midwest. The other regions saw slight declines. Here's the complete article.

Back to Gilroy - take a look around. Is there something out there for you? Call Team Patereau to talk about your wants and needs.

Intensely Local Market Indicators

As I was scanning/reading another real estate blog I came across an article at CNNMoney.com that addressed a big worry for every homeowner right now, “Has the real estate market hit bottom?”

The article states, “Because housing markets are intensely local, it won't do much good to check national figures. Instead, stay alert to leading indicators of recovery in your local market…”
The Indicators are:

1. Inventory is declining – That would mean that there are less houses currently on the market than there were last month, the month before, last year, etc. In Gilroy there aren’t.


2. Houses are selling faster than they used to – That would mean that the average “Days on the Market” number is lower for a category of property than it was last month, the month before, last year, etc. In Gilroy, it’s not.


3. Sellers are acting less desperate – That would mean they lowered the list price, they held open their house both Saturday and Sunday for several months straight, they paid closing costs, they did all inspections, all repairs, and paid HOA for up to a year. In Gilroy, the signs of desperation are growing, not decreasing.
   

I don’t have to tell you what that means, but I will: In Gilroy our market is not through “normalizing.”