Real Estate Trends: Short and Long Term Trends in Home Prices: Part 4 of 8 - How To Effectively Price Your Home For Sale

Graph 1 - Median Homes Prices in Contra Costa Counter over the last 10 years. (Quarterly)

"How Do Pricing Trends (Market Pricing Trends) Affect Home Prices?"

If you get nothing else from this post, get this: Market pricing is NEVER a function of only one variable.  While looking at trends, remember what happened with pricing and what might happen with pricing is not the only data to look at in order to establish a realistic price to list your property.

Market Pricing Trends:

What is a trend, and why do trends matter,...or do they?
A trend is "A general direction in which something is developing or changing." An analysis of trends gives buyers, sellers, and their respective agents an idea of where the market is heading. A Comparative Market Analysis is completed with the understanding that based on what happened in the past we an excellent indicator of what will happen in the future.

Graph 2 - Median Homes Prices in Contra Costa Counter over the last one year. (Monthly)

How long is a trend? A trend might be a two year period, or a two week period depending on the market.  Looking at graph 1, you can see that the last four bars; 1 year (the previous 4 quarters) is relatively stable as compared to the 9 previous years.  However, broken down into months graph 2, we see that there's been a 27% increase in median home prices: Hardly stable. Looking at one without the other could cost you!  Why the big increase in prices, then a big drop, then a rise again?  There are several reasons....OK TRILLIONS of reasons.  And the end of the day, however, simply be aware of trends and price your home accordingly.  

How to price your home if home prices are dropping?

Don't price your home at the top of the market.  This often results in what we call "Chasing the market" as the sellers is forced to drop their asking price over and over and over in order to find a buyer.  Simply pricing the home realistically would have prevented that.  I personally know of a homeowner who was offended by a particular offer...only to accept an offer 15% lower less than a year later.  That's money on the table in my book!  

How to price your home if home prices are increasing?

If trends are looking up, don't base your price on dated transactions or you'll again be leaving money on the table.  Determine your motivating factor for moving.  Do you have to sell now?  Could you list the property realistically at the top of the market and see if you get an eager buyer?  Sure!  But be realistic.  "Can't I just pull it off the market if it doesn't sell...then put it back on again later?"  Yep!  But I don't recommend it.  Multiple Listing Services show a property's listing history, and some might look back (as the market continues to change) and think, "Hmmm...why didn't this sell back then?  The price looked right."  leaving doubt in their mind.

Ultimately, be realistic.  Follow the ideas in this post and the expertise of your local area expert...and you'll do phenomenally well.

Part 3 of 8 to come!

As always, I'll leave you with this tip:

There are countless Real Estate websites online now with dozens more on the way.  These sites DO serve a purpose.  They are a wealth of data.  However, "Zestimates" and the like are solely based on just that...data, which can be close to accurate...or way, way off.  No...that house up the street didn't sell for 30% of market value!  It was probably public record of a 2nd lien that was defaulted on. These sites pull data from various sources and do a very good job at combining that data and provide a free service to it's users.  That said, their not vested.  Use your Realtor.  Use a Realtor you can trust.  If you have questions about how to find one...call me...  or just read this post.

Until next time, and thank you in advance for remembering me when the topic of real estate arises, and THANK YOU SO MUCH all the referrals.

Andy Blasquez ~ The last Realtor you'll ever need to look for.
DRE# 01826135

www.andyblasquez.com

Email me at andy.blasquez@gmail.com
Click here to reach Macky Hensel.

Please Follow me on Twitter and Re-Tweet these blogs.
Please Add me as a friend on Facebook 
Finally, please comment or ask questions.  Other readers may be wondering the same thing.  I love the feedback, critical or otherwise, and love the interaction: I love this job.

Thank you always for your support.

Continued Increase in Median Home Prices + Link to homes for sale in Brentwood, Oakley, Alamo, and Walnut Creek

Homes for Sale & Market Trends for Brentwood, Oakley, Alamo, & Walnut Creek.

Growing up in Alamo and Walnut Creek, then later moving to Oakley and Brentwood, I feel uniquely qualified to remark about the state of these local markets.

While reading this post, think about how this continuing trend is changing your possibilities:

• Do you have a home which may have been "in the red" just six months ago but is now in the black and you don't even know it? 
• Are you finally in a position to sell?
• With new programs and special circumstances are you in a position to refinance?
• With record low interest rates, are you in a position to buy in an area that was previously out of reach?
• Are you in a position to rent out your current home and buy a new primary residence?
• If you're NOT in a position to sell, do you have a hardship of some kind?  Have you been transferred?  Lost a job? Had a change in family circumstance or health?  Remember that the laws put in place to protect you in the event of a short sale are ending soon.

Here are links to homes for sale in these four markets.  These listings are pulled directly from MLS by me.  It's not some automated link, not a link to Zillow, Realtor.Com or another.

Click here to see a list of homes for sale in Brentwood, CA 94513 as of October 8th, 2012

Click here to see a list of homes for sale in Oakley, CA 94561 as of October 8th, 2012

Click here to see a list of homes for sale in Alamo, CA 94507 as of October 8th, 2012

Click here to see a list of homes for sale in Walnut Creek, CA 94595, 94596, 94597, 94598 as of October 8th, 2012

This blog post and the charts below illustrate recent trends in median home prices for the above listed markets.  Please keep in mind that the median home price is not the average home price, it is the middle!  It simply means that the same number of homes sold at a price lower than the median price as sold at a price higher than the median.

The first chart shows the change in median home prices in Brentwood, CA 94513 over the past 12 months.  You'll see that it shows a low of $279k in January, a high of $338k in July and it is now sitting at $335k.

The chart below for Oakley mind numbing!

Oakley showed a median home price of only $170k in November of last year.  The median price has increased by $100,000 in just 10 months!  That's...???  "Amazing" seems like an understatement.  It's not even increase in sales price that's so impressive, but the percentage increase.  This chart illustrates a near 60% increase in median home price over ten months!  That's an annual rate of 72%!  This can't be! It's is completely unrealistic and unsustainable, right?  ....but here's the data to prove that it's happening!

The next chart is for Alamo.  These higher end markets with fewer closed escrows per month are more susceptible to a misinterpretation of data.  With so few transactions, simply having a few closings outside the "norm" can really skew the data.

Since June, there have been seven properties that have closed in Alamo for above two million dollars: A few well above that price.  With fewer home sold, and home prices in the several million dollar rage, one transaction can skew the data by quite a bit.

Below, you can see that the median home price of homes sold in Alamo took a dip in December and January (typical of that time of year), then bounced right back.  There are other economic factors that tend to keep higher end markets more stable than less expensive areas.  I'll post about those factors another time.  Imagine seeing growth in Alamo that we see in Oakley!  Median home prices could reach the $2 million mark by the end of the year! That's just not going to happen.

Last but not least is one of my favorite markets; Walnut Creek.  Walnut Creek is a special market, with properties ranging from cute one bedroom condos just a short walk to Nordstrom and P.F. Chang's in the $100,000's, to exquisite and expansive estates at the base of Mount Diablo in the several million dollar range.  

Ultimately, it's evident that the majority of properties in Contra Costa County continue to increase in value; some more than others.  Does this mean that you might leverage an increase in one market in order to buy in another?  Hmmmm!  Food for thought.

I'll leave you with this little taste of wisdom:

" Opportunities? They are all around us. There is power lying latent everywhere waiting for the observant eye to discover it."

 ~ Orison Swett Marden 

Until next time, and thank you in advance for remembering me when the topic of real estate arises.

Andy Blasquez ~ The last Realtor you'll ever need to look for.
DRE# 01826135

www.andyblasquez.com

Email me at andy.blasquez@gmail.com
Click here to reach Macky Hensel.

Please Follow me on Twitter and Re-Tweet these blogs.
Please Add me as a friend on Facebook 
Finally, please comment or ask questions.  Other readers may be wondering the same thing.  I love the feedback, critical or otherwise, and love the interaction: I love this job.

Thank you always for your support.

Near or Far, ALWAYS use a local Realtor: How Micro-Markets add to the dynamic of home pricing

Using an out of area agent could cost you a fortune!

Not long ago, a veteran Realtor and fellow blogger remarked on one of my posts.  He politely reminded me that the trends that I was sharing applied to my local market, but in the micro-climates of his area trends applied to some but not to others.  

This is absolutely and always the case.  Our nation has trends as a whole, and trends within geographic locations.  Our state of California certainly has trends, and micro-markets. But even our local markets also have sub markets; some even within the very same development.  

Why does this matter to you?  Well whether you're buying in Brentwood, Alamo, or Timbuktu, you could lose a fortune if your agent doesn't have intimate knowledge of the market that you're buying or selling in.  

I strongly recommend doing your homework and finding a Realtor you trust with local area expertise. 

For some light hearted but serious information on finding an excellent agent

enjoy these posts:  part 1, part 2

 Home prices are a function of the following variables:

• Demand or number of buyers with the ability and willingness to buy.
• The supply of properties on the market, including homes that our builders are selling prior to completed construction
• Interest rates - If a buyer can afford $2,000/mo....@ 3.5% interest, he/she may be able to purchase a home for $375k, but if interest rates go up to 5.5% the purchase price would have to drop to $290k or so.
• Speculated future values of specific properties and real estate in general
• Consumer Confidence Level
• Other less impacting factors

Let's look at the table below and compare the 1st two properties:  

• They are both in Brentwood
• Both +/- 3,800 square feet
• Both 4 bedrooms
• Build in the mid 2000's.  
• Lot sizes are within 20% of each other. 
• Both WERE in highly sought after areas

...but, for several reasons, one area held held it's value better than the other when the market turned.  An outside agent looking at these two properties might think that the discrepancy is not valid. That misinformation can and will cost you...weather buyer  or selling.

Look at the bottom two properties listed above:
You'll see the same thing.  Similar homes, but the one with only two bedrooms is listed $90,000 higher than the 3 bedroom?  In this area, and in virtually all areas throughout the world, this is common.  These local market tendencies and trends will often differentiate home values for something as seemingly benign as being on opposite sides of the same street!  Using a local area expert  is your best bet, whether you're looking to buy or sell.

If you have questions about an area you are looking to sell in, or to buy it, please click here to e-mail me.

I'll leave you with this little taste of wisdom:

" Character is the ability to follow through on a resolution long after the emotion with which it was made has passed."

 ~ Various Speakers

Until next time, and thank you in advance for remembering me when the topic of real estate arises.

Andy Blasquez ~ The last Realtor you'll ever need to look for.
DRE# 01826135

www.andyblasquez.com

Email me at andy.blasquez@gmail.com
Click here to reach Macky Hensel.

Please Follow me on Twitter and Re-Tweet these blogs.
Please Add me as a friend on Facebook 
Finally, please comment or ask questions.  Other readers may be wondering the same thing.  I love the feedback, critical or otherwise, and love the interaction: I love this job.

Thank you always for your support.