The Following Article is from the Spring 2006 Newsletter
The start of 2006 has been interesting and different compared to years past. There is general confusion about what the market is doing; it feels hot and cold at the same time. Some price ranges are very hot and some are not. The new listing inventory coming on the market in the first quarter of 2006 has lagged behind 2005. The number of new listings and homes sold year over year, 2004 and 2005, was down approximately 27% in our market place. The number of homes sold in the first quarter of 2006 was down five percent however the inventory of new listings, this spring, is down 25% over last spring.
The pace of the market on the Westside feels more like a fall to winter pace than the typical robust spring pace we have grown accustom to. Some of the unique and highly desirable properties that have been listed this spring would normally sell immediately in a frenzy of multiple bidders. This year it has happened a few times but without the usual frenzy or as many bidders. Sometimes these properties will actually sit on the market for a few weeks before selling with more than one offer or at least sell for a respectable price to a single offeror.
The activity in the market quickened considerably in early March with more inventory. Since then the number of homes going into escrow has dramatically picked up. Most of the transactions have been more difficult. There is more strenuous negotiation in the sale process but especially during the escrow over issues of mold, drainage, water intrusion and general condition of the property. Buyers are fussier and Sellers are still hoping for the next level of appreciation.
The homes that come on the market at fair market value are selling more quickly and for higher prices because Buyers are being more selective and more deliberate. It is somewhat anomalous having low inventory and not having the frenzy of multiple offers that we have seen over the last few springs. The operative word is “caution” for Sellers listing their homes for sale in this market. They need to be reasonable when selecting a sales price, prepare their home for sale and hire the most experienced agent in their marketplace for maximum representation.