SAN FRANCISCO – (Sept. 1, 2008) – The best news today was that New Orleans was spared and Gustav is now rated a tropical storm. Although there is damage, it is minimal compared to Katrina. We can all be grateful for Mother Nature’s reprieve.
With summer rapidly giving way to Fall and the Presidential election around the corner the housing market has gone into a holding pattern. The under million dollar priced houses still dominate the number of sales leading to both a drop in average and median sales price. The perfect example of this trend is in Marin where 33% of the active inventory is in contract in the 0-$750K category while $750-1 million is at 20%, $1-2 million is at 15%, $2-4 million at 18% and above $4 million at 5%.Buyers continue to frequent open homes like fishermen throwing their lines into different parts of the stream looking for that big one – in this case the super value property. Open home activity picked up during this report period. Many of the opens had double digit attendance and one in Greenbrae had close to 100 buyers.We are seeing fewer multiple offers Bay Area wide, although some areas like SF and the Berkeley/Piedmont/North Oakland continue to see a good number of them. However most multiples are under $800,000 range. During this reporting period 70% of the multiples were in this category.Financing is readily available for conforming loans – those under $729,750. Jumbo loans, those over that amount, are obtainable, but at higher rates and stricter underwriting requirements.Negotiation skills and patience are basic requirements for transactions to come and stay together. Accurate pricing and pre-listing preparation are a prerequisite for sellers if they want to sell in a reasonable amount of time and for the highest equity returns.On the positive side, homes are still selling. Most of the saleable inventory (properties priced for today’s market) has moved during the summer keeping months supply of inventory declining. Our open sales this August compared to last were up 16% however the volume of sales was down due to the declining median price.Another bright note is that the Fall inventory is about to hit the market. The reports are that a new wave of well priced and well staged homes will be coming on the market over the next month. A number of these listings are in the over million dollar price range.Next week will be the August recap for the Bay Area. It should give us a glimpse into what Fall will portend.Hope you had a better summer than this guy.Editor’s Note:Avram Goldman is the President and CEO of Pacific Union GMAC Real Estate in the San Francisco Bay Area.