Best Way to Sell A Home

Agents can be their own worst enemy when what they should be doing is finding the best way to sell a home.Frequently Unasked Questions

The real estate business is hard enough without agents making it even more difficult. Many of our clients assume we work 24/7 and the business practices of many agents essentially ensures that we do.

There’s no standardized best practice when it comes to lunching a home for sale. Homes pop up every day of the week and offers are entertained anywhere from before a home even hits the market, to hours, a few days or weeks later.

Take for example our local market where with very little inventory, homes are flying off the shelf. Unless there is some sort of structure to the launch and contract review day, one could never get a day off as every time a home would hit the MLS agents would have to scurry over and get their clients in within minutes or the home might be sold.

Thankfully, many local agents set a date to entertain offers so that buyers and their agents aren’t scrambling to see all of the available homes at a moment’s notice.

Recently, a new standard of practice has started to develop as some agents have begun listing properties before the weekend—holding one weekend of open homes, a Tuesday Broker tour, and listening to offers the following Friday. That equates to 7 days on the market. And while it brings some semblance of order to our otherwise chaotic trade, it’s not the best course of action to get the seller the most for their home.

The first issue is the earnest money deposit. Listening to offers on Friday is fraught with anxiety as our contracts default to 3 business days to deposit the buyer’s consideration (deposit) into escrow. A Friday offer date means the buyer’s deposit money doesn’t even hit escrow until Wednesday of the following week—five days after contract ratification. Even if the buyer’s agent changed that in the contract to 1 business day, the deposit is still not due until Monday after a weekend of new open homes. It’s not unusual to see a buyer get cold feet or see a better home over the weekend and decide not to deliver the deposit. No agent wants to find themselves trying to resurrect a highest offer a week later yet they continue to put themselves and their sellers at risk.

Another issue is sufficient market awareness and, the mere practicality of seeing a home, analyzing the recent sales in the area, reviewing the reports and making an informed offer. Most buyers today spend more time choosing their washer and dryer than they do actually buying their home—it’s an unsustainable pace and will invariably lead to lawsuits.

Anecdotally, we’ve encountered many buyers during our first open house praying that we will be open one more weekend as their spouse was out of town for the week. If you market your home for less than one week you’re potentially missing out on interested buyers who may be unavailable during that small window. And imagine the frustration when buyers who take just one week off to get away during their year long home search are out of luck when the ideal home gets listed by one of these agents the week they are away.

Our research indicates we’ve received some of our highest and best offers often from a buyer who saw the home at the second open home. On a home we just listed and sold with four offers in 11 days, had we heard offers before the second open house we would have missed out on two of the suitors (bidders) who came through the second weekend.

But who is to say our strategy works the best? The numbers do. We consistently outperform other agents with the percentage over the asking price we net our sellers. And it’s not because we under price our listings. We do this by sticking to a formula with proven results. We’ve also never had a buyer voluntarily back out of one of our listings once in contract. We contribute part of this success to slowing down the process and not putting people in a foot race. We think that market saturation is good for sellers and buyers as the sellers get maximum market attention and buyers have more time to digest whether a home is right for them before they get into escrow.

The numbers below represent all of the homes sold in Belmont year to date. Notice that there’s a sweet spot where too many days on the market and a home gets far less, and too few not enough.

Sellers who marketed their home on average for ten days received more than agents who took offers too soon. It’s also interesting to note that of the 67 homes which have sold thus far this year, the highest over asking a seller received was 46%–marketed for 10 days. In fact eight of the 14 homes which sold 20% or more over asking were listed for greater than 10 days but less than 14.

Median
% over Asking Days on Market
>20%

10
15-20 %

9
10-15%

12
5-10%

8
0-5%

34
< 100%

33

mortgage-rates27-300x300

 

Many agents banter about claims that they will sell your home for more money in shorter period of time—but we have the numbers to back us up. We base our system for marketing homes on a proven strategy that nets our sellers consistently more than the other top agents in our territory. Our listings are all on the market for 11 days which accounts for two weekend of open houses, one broker tour and offer date after the second set of open houses. To find out what else we do, contact us directly to learn more about our progressive services.

Disclaimer:

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441 or emailed at info@morganhomes.com.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Belmont Home Sales Off To A Frenetic Start

 

It seems the Belmont housing market is off to another strong start in 2014.

In every category we track, homes sales in February of 2014 were stronger than in 2013.

Belmont February 2014

SALES

Sales were at a dead tie with last year. Considering there were fewer homes to sell, that’s a strong indicator of the urgency on the part of buyers to get a home before the prices (and/or interest rates) rise any further.

[click on the image for a larger picture]

NEW LISTINGS

This February Belmont had 20 new listings compared to 23 in 2013.

INVENTORY

The number of available homes for sale this February was only 14—down from 17 last year during the same time.

DAYS ON THE MARKET (DOM)

The average time it took a Belmont home seller to sell their home this February was only 11 days, down from 17 last year.

PERCENT RECEIVED

Sellers for Belmont homes received on average 109.32% of their asking price compared to last February when they received 107.37%—still far above the state average.

MONTHS OF INVENTORY

The total months it would take to sell of the current inventory dropped from 1.55 months last February to 1.27 months this year. The national average is 5 months of inventory.

All indications are for another strong year—as we predicted. Next report we’ll wrap up Q1 with March’s numbers.

If you are considering a move this year, the spring time is a great time to get top dollar with competitive offers.

WRAP-UP

SELLERS—

GOOD NEWS—you can sell your home quickly at the right price. Most homes are selling over asking if priced according to our current market conditions—that is to say most homes sell for +/ 10% over asking so pricing at what your homes is worth makes it overpriced to buyers.

Not all agents get you the same results—interview wisely.

BAD NEWS—this seller’s market won’t last forever. More homes are coming on the market because more sellers have equity to move. The days of paying too much for a home and windfall profits are nearing the end.

BUYERS—don’t think if you read the above that you can wait out the market. That’s a fool’s game as although the rate of appreciation will wane, it’s still in positive territory for the foreseeable future.

Disclaimer:

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441 or emailed at info@morganhomes.com.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Drew & Christine Morgan did not necessarily participate in these sales.

Belmont Home Values–Are They Sustainable in 2014?

Belmont Home Values for 2013–A Market Re-Cap

This year-end summary is where we bring you the re-cap for Belmont Home Sales. To say the least, Belmont sellers had a good year. After watching their home values drop for five years in a row (until 2011), they finally enjoyed some relief in 2012 and in 2013 as Belmont home prices reached a new high never seen before.

Here’s how it all stacked up.

This graph shows the median price in Belmont from 2012 through 2013. Many postulate about whether the market has returned to its previous high. To answer that, we looked at the median home trend in Belmont going back to 1998. Belmont’s median home price was over the million dollar mark for every month last year—save March. The closest we came to that was back in 2007 when we hit a period over the million dollar mark only twice. In many areas of the east bay and the country as a whole, they are still shy of the highs seen in 2006.

Belmont Median Price Trend 1012-2013

MEDIAN HOME PRICE

The median home price in Belmont last year, as reported by the Multiple Listing Service [MLS] in aggregate form, was up 19.5% from $949,230 in 2012 to $1,133,917 in 2013.  But not all areas fared the same.

 

 

 

 

 

 

This map show which areas of Belmont increased more year-over-year than others. If this seems odd to you, read the post we did on Which City is More Affordable—Belmont or San Carlos where we discuss some of the idiosyncrasies that have an effect on micro-regional values.

Belmont 2013 areas median Adjusted

 

If you’re like us and you are wondering why some areas of Belmont saw so much more appreciation than others, we took another step and looked into the size of homes selling in the respective areas during the two periods to see if that could account for the variance.

The red percent displayed on the map is the raw median price reported by the MLS and the blue percent is an adjusted percentage taking into consideration that either smaller or larger homes sold in the two periods.

These are our findings:

 

Areas

2012

2013

Variance

Raw Increase

Adjusted
Hallmark

2150

2280

6%

30%

24%
Skymont

2020

1830

-9%

20%

29%
Belmont CC

1840

1870

2%

15%

13%
Carlmont

1800

2029

13%

40%

27%
Sterling Downs

1190

1220

3%

27%

24%

 

This of course would indicate a raw median home price in Belmont of 26% and an adjusted one of 23.5%–much closer to the numbers reported in aggregate form from the MLS.

INVENTORY

The big brouhaha last year was over the lack of inventory. There were only seven fewer homes listed for sale in 2013 but 23 more sales than in 2012. Of course, this created fewer homes for buyers to choose from, which then led to bidding competition and prices going up at exponential rates.

DOM (Days on the Market)

The time it took to sell a home in Belmont last year almost dropped in half from 2012—from 37 to only 21 days.

PERCENT RECEIVED OF ASKING

The “Sizzle Factor”, or “How Hot Is the Market?” reached a new high with the average Belmont home seller receiving 108% of their asking price compared to 102% in 2012.

What can we expect in 2013? Probably more of the same. The median home price rate of appreciation should slow, as many homes which were under market value have regained much of their lost appreciation. We’d take a guess that appreciation will be closer to 14%-16% on average for Belmont—down about 5% from what we will imagine was the height of appreciation increases in 2013—we’ll see.

The factors to watch which could alter this trend will be the waning bond purchases by the FED which will serve to raise interest rates and may take away the ability for buyers to bid so much over the asking price in the latter part of 2014.

This begs the initial question of are these homes values sustainable and the answer is that depends. If the economy continues to improve and the rate of appreciation slows, than the short answer is yes—for now. But recent developments in China’s economy could have an impact on the rate of future appreciation and the U.S. economic rebound. Remember, what started the whole Bay Area recovery was jobs. If that changes, the game we know today could be over very soon.

 

Disclaimer:

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441 or emailed at info@morganhomes.com.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

 

Belmont Home Sales Smash Records! December 2013 Market Report

Welcome to our Belmont home sales year-end report. In Part I we close out December’s sales, and in Part II we recap the year and the look deep into our crystal ball for what may be in store for the housing market in 2014.

PART I

Let’s start with December sales:

December was a strong month for Belmont home sales, as winter home sales go. We contrast these sales to the same time last year to avoid any seasonal anomalies.

Belmont December 2013

SALES

Belmont had 18 home sales in December—one less than last year and five more than 2011.

MONTHS of INVENTORY

At the current rate of sales, compared to the existing inventory and new listings, the time it would take to sell all of the homes in Belmont dropped to an astonishing low of .28 months—that’s a little over a week of inventory. To help put that number in perspective, San Mateo County is running at 2.2 months and the country as a whole is at around five months.

Which part of the equation changed since last year? The number of new listings year-over-year was unchanged and sales were relatively unchanged but the inventory level was already at only five homes for sale going into December this year as compared to 12 last year so the appearance in the rate in which inventory was depleted was exacerbated.

MEDIAN HOME PRICE

The median home price rose to $1,086,000—a 16% increase over last December and essentially unchanged from the prior month. What did change is that in 2012, for $939,000 one could get a 2,150 square foot home while this year, at the new median home price of $1,086,000, one could purchase a home only 1,625 square feet in size. So for 15% more, buyers in 2013 bought homes that were 32% smaller than in 2012.

DOM (Days on the market)

In 2012 it took 54 days to sell the homes that closed in December while this year that number dropped to only 19.

Hot Pepper 25PERCENT OF ASKING

And now we get to the Sizzle Factor—what percent homes are selling of the asking price. It’s a great measurement of just how hot the Belmont housing market really is.

In December of 2012 Belmont homes were selling for 98.83% of the seller’s asking price. This December Sellers grossed 107.6% of their asking price. At a median home price of $1,086,000 that delta is huge! It represents sellers netting on average $95,000 more for their home in 2013.

PRICE REDUCTIONS

In 2012 42% of the listings that sold had price reductions of on average $158,000, while in 2013 only one lone seller had to lower their initial asking price by $30,000.

In 2012 58% of the homes sold for an average of $44,000 under the seller’s asking price and 37% sold for on average $37,000 more.

In 2013 83% of the sellers received on average $99,000 over their initial asking price while only two sellers settled for on average $12,500 less.

In Part II we’ll take a look at Peninsula home values on a more macro level and discuss what may be in store for 2014.

Disclaimer:

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years of experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Drew & Christine Morgan did not necessarily participate in these sales.

Are Belmont Home Values Near The TOP–August 2013

Are home values near the top? Thus far this year the media focus has been to highlight the hot local housing market. Now it seems they are looking for any signs of it faltering to present a new angle. And in deed you may have already heard the recent reports from Case-Shiller and others indicating that the market is showings signs of cooling off.

When will it begin to cool? Has it already?

Remember—real estate is local yet media reports often are not. What you might be hearing in the news may not apply to the neighborhood where you live.

With the biggest housing crash since the great depression* still front and center in our memories, it’s no wonder that potential purchasers might be wary of how fast the market has rebounded.

We recently released an article discussing those very points—“What’s in store in Q4”. In it, we delve into why we believe if recent changes in market forces continue, the once rapid rise in home values will begin to wane.

AUGUST 2013—For now, the numbers are in for Belmont for August 2013 (Septembers will be out soon), and there’s no sign of a let up in our fervent housing activity—at least according to the numbers for August.

Belmont Home Values Aug 2013

[click on the graphic for a larger picture]

MEDIAN HOME PRICE

Most notably is the pace of the median home price in Belmont. It stands at $1,105,000 which is a 20% increase over last year during the same time. We’re the first to look at the size of homes selling in the two periods to see if perhaps larger or smaller homes sold and skewed the median home price. But what we found was that in August of this year the homes that comprised the sales mix were 16% smaller and yet cost 20% more. Also interesting to note was that the median home price in Belmont has been over the million dollar mark for the last four consecutive months—in fact had the median home price not dipped just below that threshold in April of this year, it would have been over the million dollar mark every month so far this year. Contrast that to the historical median price trend in Belmont which has never had consecutive months over the million dollar mark.

Summary—Belmont homes values have hit a new high.

SALES

August of 2013 saw a 55% increase in home sales and paradoxically a 70% decrease in new listings.

MONTHS OF INVENTORY†

That brings us to the inventory which was down 131% from August of 2012 resulting in a record low “Months of Inventory” factor of .73, down from 2.6 months in 2012.

DOM [Days on Market]

The average time it took to sell a home which closed in August was 17 days, down from 31 in 2012.

PERCENT RECEIVED OF ASKING

This August 80% of the sellers received on average $130,000 or 9% over their asking price as compared to 44% of sellers receiving $60,000 or on average 2% more than asking in 2012.

In short, the inevitable slowdown in the RATE of appreciation is news but it hasn’t appeared in the statistics yet. If you talk with a Belmont REALTOR® you’ll no doubt hear they think the market has cooled off a bit. We’ll look at September’s sales to see if that’s true, because July sales, (which resulted in August statistics), didn’t bear that out and neither did our first-hand experience.

Sellers of homes in Belmont should know that the majority of the rebound in equity has already occurred. The rate of appreciation will slow as the market forces we discuss on our blog begin to kick in. If we’re right and they do, the housing market will become much more sustainable—we have our fingers crossed.

*http://en.wikipedia.org/wiki/United_States_housing_bubble

†Months of inventory is the time as measured in months that it would take to sell all of the homes currently listed for sale, assuming no more new homes were listed.

Disclaimer:

Drew & Christine Morgan are REALTORS with RE/MAX and a NOTARY PUBLIC in Belmont, CA. with more than 20 years of experience helping sellers and buyers in their community. They may be reached at (650) 508-1441.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Drew & Christine Morgan did not necessarily participate in these sales.

What Does Q4 Have in Store for Our Local Housing Market?

Is it a bubble?Now that the media is hyping our local market once again with horror stories of multiple offers, and media proclaimed “Bidding Wars”, our attention turns to watching for signs of a change in the tempo of sales and/or over asking offers. Everyone knows the Peninsula housing market is red hot, and has been for more than a year now. The question now becomes, “When will it change?”

Some Pundits are already predicting a crash in what they perceive as an overheated housing bubble. Of course if they continue droning on about a market crash their theory eventually may come to fruition, but for now their bubble is more akin to a hot air balloon with scant facts to back it up.

The Case-Shiller report by Standard & Poor’s is a good macro-barometer of our Bay Area housing market and the nation as a whole. The Case-Shiller report, most recently released on September 24th 2013, showed an increase in the 20 largest housing markets across the country. In our area or “MSA” (Metropolitan Statistical Area), which includes the Napa, San Francisco, San Mateo Alameda and Contra Costa Counties, the index had risen 25% from July 2012 through July 2013 [Case-Shiller reports are delayed by three months so the September reports was actually for July].

Economists, like the National Association of REALTOR’S Lawrence Yun, have warned that prices have been rising “too fast” and at these double-digit rates of appreciation are “unsustainable”. We couldn’t agree more. The current rate is unsustainable in the long run, but we believe that many factors already in play will mitigate the danger of a bubble. But let’s take a small step back. Part of the reason that home prices have increased so dramatically is that in many areas they were below reasonable market values for so long that just returning to normal would be a huge increase. Many areas saw homes values plummet below the cost of construction. Home prices have not reached the May 2006 peak where the SF MSA stood at a whopping 218—24% higher than today. At the current rate of price increase home values would reach the peak seen in May of 2006 in one year from now.

We don’t believe that will happen—not even in the crazy Bay Area real estate market. Why?

What’s already in play to slow the engine of appreciation and avoid another economic train wreck?

  • More homes are being built as companies try to meet the new housing demands—this takes pressure off of the tight inventory
  • Interest rates will begin rising making homes less affordable—this will put pressure on price increases and most certainly limit over asking offers
  • More equity sellers are being created every day—more inventory will mean less upward pressure on prices
  • Investors are taking a break—as interest rates rise and unbelievable deals once had from the recession are gone, investors look for other opportunities outside of housing. Less competition for homes will help keep a lid on housing inflation.

According to the Case-Shiller study, “Since April 2013, all 20 cities are up month to month; however, the monthly rates of price gains have declined. More cities are experiencing slow gains each month than the previous month, suggesting that the rate of increase may have peaked.

Morgan Brennan who writes for Forbes Magazine on U.S. Housing markets, summed it up best in her article back in June titled “3 Reasons The ‘Bubble-Like’ Surge in Home Prices Won’t Last“. And since we agree with her sentiments, rather than re-invent the wheel we rather encourage you to read more about her theory.

 

Disclaimer:

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441.

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Belmont Home Values Break New Records – Home Sales Report for May 2013

It’s time to do the numbers, and I can hear the jingle playing in my head “We’re in the Money”–a little ditty from NPR’s Market Report segment which they play when the stock market is up. As each month goes by it seems Belmont home values keep setting new high water marks–not that we’re insensitive to the woes of buyers. We represent Buyers too and we know how frustrating it can be to secure a home in today’s market. The inherent problem for buyers when timing the market is that when housing prices are down, typically so is the overall economy and nobody feels much like taking on an enormous mortgage when coworkers are being laid off and empty cubicles are selling for pennies on the dollar on Craig’s list. Finally, when the economy picks up and everyone feels happy again they all starts to buy at the same time and drive up prices with overbidding. Add to that the sense of interest rate lock urgency and you have a market running full speed ahead. It’s no longer how much a home will sell for, it’s how far over asking will it go.

Belmont Home Values
Can You Save Fast Enough?

This month just about every positive indicator for sellers was up. In fact they were all up except the days on the market [DOM] or the time it took a seller to sell their home—that statistic was down which really means it was up for sellers—another positive sign.

So let’s begin by dispensing with any question of where the market is today—it’s clearly rebounding and doing so at a pace like we’ve never seen—and we’ve seen a lot of ups and down in our 20+ years of selling homes.

What’s driving this rebound at a clearly unsustainable level? Ironically, the good news may be is it’s a temporary influx which may soon be abating. The days of government intervention in the market by keeping interest rates artificially low with bond purchases may be numbered—at least that’s what Wall Street thinks. When we wrote this the stock market was singing “Stormy Weather” as news of an impending slow down in bond purchases sent the stock market into a bit of a humble tumble.

Looking at Belmont home sales for May 2013, we see that there’s no more debate about how the market is doing. The only question is, how long will this corybantic pace continue?

Belmont Home Values
Click on the picture for a larger size.

SALES

Home sales, after being down past month, rebounded with a 23% increase over May of 2013 were 32 homes traded hands as compared to 26 last May. The last time Belmont had that many homes sell in one month was in August of 2005 when 35 homes sold—well before the market correction which began in April of 2006 [it took well into another year for the national housing dilemma to begin to affect Belmont’s more insulated economy].

MEDIAN PRICE

Belmont home values reflected the median price topping out at $1,100,000 this May which has only been eclipsed twice in the history of Belmont home values—once in 2007, and most recently in January this year. One cannot not escape noticing that the median home price in Belmont has been over a million dollars four out of the last five months—a pinnacle in Belmont’s housing values trends as never before have we seen a sustained median home price over the million dollar mark.

So did larger homes sell this year? Each month we’re sure to look and see if that’s the cause and each month the answer has been yes, but only nominally. Certainly not enough to account for the year over year gains.

The median size home which sold in May of 2012 was 1,790 square feet. This May that increased 6.4% to 1,905 while the median home price increased 33%–from $825,000 last May to $1,100,000 in 2013.

What does this all mean? It means that a home 6.4% larger cost you 33% more this year. It means that Belmont home values are rising faster than most buyers can save money.

DOM [Days on the Market]

Statistically speaking, if you are going to get more for your home than you are asking, in Belmont that means you’ll be on the market less than 14 days. Between 14 and 21 you are considered lucky to get your asking price and rarely does a seller get their asking price after 21 days on the market.

This month’s numbers bear that out in spades as all of the homes which received more than their asking price did so in only 13 days. No home sold right at the seller’s asking price but of the few homes which were overpriced, they languished on the market for on average 22 days and received 98% of their initial asking price as compared to everyone else who netted on average 110%. Can you imagine being one of the few sellers who received 12% less for their home than everyone else? Clearly not all agents are created equal.

Of course getting too much for a home is usually the result of the same root cause—an agent who has no idea how to price a home—just that in the latter case the seller is much happier and probably never the wiser.

We’ll leave you with this one watercooler statistic. Did you know that in May the average Belmont home sold for $100,000 more than the asking price!

Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA with more than 20 years of experience. They may be reached at (650) 508.1441 or info@morganhomes.com

Disclaimer:

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.

Drew & Christine Morgan did not necessarily participate in these sales.

Belmont Home Values Rise Again in April But Sales Cool Off – Housing Report for April 2013

We’ll do a quick re-cap of the Belmont housing market for April 2013, since by now unless you’ve been living under a rock you’ve heard that the Peninsula housing market is back in full swing; and some would argue the swing is becoming dangerous to ride.

We’re probably a few years away from that precipice and we seriously doubt that the current run up of home values will continue at the frenetic pace we’ve seen in the last year. If the rate of appreciation settles down to sub double digit increases year-over-year the market will be more sustainable.

If you are some place where you can hear our audio accompaniment, we’ve recorded a short piece which helps explain some of the perplexing numbers for Belmont home values in April of 2013.

That’s a long way of saying we’ll be brief in our analysis this month. We’ll start with the big news which is probably not what you’d expect to hear…

[click on the sales for a full size chart]

Belmont Home Sales April 2013

SALES

Sales year-over-year dropped 30% in the month of April. In April of 2012 24 homes traded hands while in 2013 only 17 homes closed escrow.

 

New Listings

New listings were up 40% in 2013 over 2012 for the month of April.

Current Inventory

The inventory of homes available for sale in April of 2013 dropped 27% over last year at the same time.

Months of Inventory

The time it would take to sell off the entire current inventory of homes at the current rate of sales was virtually unchanged from 1.78 months of inventory last April to 1.76 months this year.

Do some of these numbers seem paradoxical? More new listings and fewer sales—is the market cooling off? If you’d like a more detailed discussion you may visit our blog page for a short podcast where we explain the correlation these numbers have to each other.

MEDIAN PRICE

The median home price in Belmont increased around 12% to $955,000 over last April when the median price was $849,500.

Reading between the lines—we see that the size home that sold in 2012 though was also 2,070 square feet as opposed to the homes which sold this April which were only 1,520 square feet. Effectively this means in 2013 you get a home in Belmont that is 26% smaller but cost you 12% more. That’s a serious increase in prices in just one year which we discuss more in the audio portion.

PRICE REDUCTIONS

Another indication of the hot Belmont housing market is reflected in the number of price reductions—or lack thereof. There were no price reductions in April for any Belmont home which sold.

In April of 2012, out of the 24 sales 10 homes sold above the asking price, 4 sold at the asking price and 10 sold below. In 2013 all but one home sold over the asking price.

PERCENT RECEIVED

Sellers in Belmont received on average 111% of their asking price in April of 2013 as compared to 99.6% last April.

If you are a seller who has been waiting for the market to rebound, it just did.

Data from the Multiple Listing Service for San Mateo County – MLS Listings, Inc.

Disclaimer:

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario. Drew & Christine did not participate in all of these sales.

Case-Shiller Posts Higher Home Prices in the Bay Area

New York, April 30, 2013 – Data through February 2013, released today by S&P Dow Jones Indices for its
S&P/ Case-Shiller Home Price Indices, the leading measure of U.S. home prices, showed average home prices increased 8.6% and 9.3% for the 10- and 20-City Composites in the 12 months ending in February 2013. The 10 and 20 City Composites rose 0.4% and 0.3% from January to February.

“Home prices continue to show solid increases across all 20 cities,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The 10- and 20-City Composites recorded their highest annual growth rates since May 2006; seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row – the last time that happened was in early 2005.

“Phoenix, San Francisco, Las Vegas and Atlanta were the four cities with the highest year-over-year price
increases. Atlanta recovered from a wave of foreclosures in 2012 while the other three were among the hardest hit in the housing collapse. At the other end of the rankings, three older cities – New York, Boston and Chicago– saw the smallest year-over-year price improvements.

Housing Price Increases – Is There Any End in Sight?

Looking at the home sales in Belmont during the first quarter, one can see from this spreadsheet that every seller who listed their home received over their asking price. They were only a few exceptions. One was a home that was a short sale which we took out of the mix since those list prices are arbitrary, one was an off-market sale. We discounted any home that had been listed since last year to reflect the more robust 2013 season.

[click on the image for larger print]

Belmont Q1 2013 Home Sales

The percent that sellers are receiving over their asking price is mind boggling. It all has to do with the short supply of homes and the large numbers of buyers trying to take advantage of the historically low interest rates.

Of course that could change. Interest rates could rise making homes more expensive, or with rising prices, more “Equity Sellers” will develop as homes which were under water can now be sold for a profit. More inventory of homes means more competition for sellers as buyers will have more homes to choose from.

Disclaimer:

The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.