Weekly Market Watch

Coldwell Banker Weekly Market Watch
Week of January 27, 2008

Out of curiosity, I looked back in the archives and pulled up the Weekly Market Watch from the same week last year. A lot has certainly changed in the past year as we know. But it is interesting to note the number of things that didn’t change year over year. Potential buyers are out in droves at the open houses in practically every single market. Parts of the Peninsula and the City are still starving for fresh inventory. The high end homes continue to sell quickly and many with multiple offers at over list price. The media continues to drive buyer perception with alarmist headlines and a constant barrage of confusing reports from myriad sources.

What’s different this week? We seem to have less of a stalemate between buyers and sellers regarding price and condition. Sellers have finally figured out that they can’t get peak market prices anymore and are either conceding to reality, or bowing out until the market rebounds. We also now have that feeling of palpable, pent-up demand on the part of buyers that I’ve mentioned before. This time last year, the feeling was that buyers were actually more just “lookers.” Now, with an additional slash in the short term lending rates from the Feds this week, and an economic stimulus package that may include provisions for raising the conforming loan amount, buyers feel like they may actually be able to do what they were hesitant about doing last year - buy. They seem to be realizing that in the Bay Area, now may be the best time to buy in years –especially if the conforming loan amount is increased. (Reminder: The stimulus package passed the House, but could get stuck in the Senate, so contact your Senators and insist on their support!)

In Berkeley, a duplex and triplex continue to draw groups of 30, even in the rain. In Pleasanton, a property priced slightly below $2 million that has been on the market for a year just sold with multiple offers. Oakland is also seeing multiple offers for good properties. Petaluma notes “when it’s priced right – it will sell!!” Walnut Creek is noting that the majority of its sales are to first time buyers. We are even seeing REO properties in San Francisco and elsewhere starting to generate multiple offers.

Some buyers are already taking the plunge, and some in a particularly spectacular way. In Menlo Park, there were two homes priced over $5 million that sold this week, and a new $2.5 million listing had three offers and sold over asking. In Burlingame, there was a preemptive sale to a developer who bought a prime address without even seeing it. A $10.9 million listing in Hillsborough was listed on Monday, had 150 agents come through on tour Tuesday and received two offers on Tuesday night. A listing agent made a particularly poignant point that I’d like to share:

“There are buyers out there for just about every price point. Value is not only a subjective thing, but also a relative one. Buyers with the wherewithal to afford such properties (as this) are really no different in their thinking from those in lower price points. Every one wants a deal, or at least the perception of one. Certainly no one wants to be the chump who overpaid.”

Can’t say it much better than that.

Have a great week.
Rick

Rick Turley
President, San Francisco/Peninsula
Coldwell Banker Residential Brokerage