|Homes in the Golden Hills are in High Demand|
Recently I've been writing about the bone chilling lack of inventory in North Redondo Beach and how that factor, combined with record low interest rates and high rents, has driven up prices. And with only 29 homes on the market as of this writing there are certainly far more buyers looking in 90278 than there are available listings to meet demand. But that's not how things are playing out elsewhere in the Beach Cities where buyers are just saying no to escalating list prices.
I just tweeted this article from my @ellisposner account. If you are not following me on Twitter you really should be, lol. The article, which appeared on Yahoo Finance and of course quotes Robert Shiller of Case-Shiller fame, talks about how this low inventory and high price double whammy has really affected buyers and differs from the pre-crash bubble. It pretty much echoes what I just wrote: instead of chasing the market up, many buyers are not rushing in.
There's some other great data points such as the latest sales figures indicate a 7.1% slide to the lowest pace since February but also cites that buyers do not anticipate the kinds of crazy gains we saw during the previous run up in the mid 2000's even though in some markets we are already seeing 8%+ increases.
There's another factor at play which may work to turn off prospective buyers that the article doesn't mention. That is the absolutely brutal terms that some sellers are trying to force buyers to agree to. This, more than price in many instances, has turned buyers off more than anything.
I'm talking about very short contingency periods or waiving inspections, appraisals etc plus taking properties in as-is condition and even allowing multiple month lease backs at $1. And then some.
What does this all have to do with North Redondo Beach? Glad you asked.
So far during March there have been 27 escrows that have closed already far exceeding our February total of 18 with another 10 days left. On top of that there are 65 homes still in escrow and undoubtedly a fair number will close before the end of March. Sellers, that may not equate to your home being worth $50K more than your neighbors which just sold. (Unless I'm your agent of course.)
With 29 current active listings how do we refill the funnel? I'm not expecting to see a lot come on the market this week as we head into Easter Sunday. After that? Well technically we should be well into the peak of the selling season. Or so says Zillow.
I am predicting that we are going to see reported sales numbers literally all over the place in 2016. One month will long very strong and the next may look quite weak. Prices will look flat and then all of a sudden seem to be barreling out of control again. Or heaven forbid there may even be some dips.
As a buyer, your best strategy is patience, keep saving and stay the course. Because if there's one thing that is for sure in Real Estate is that things change and often quite rapidly.