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Andrew Hong's Blog

By Andrew Hong | Agent in Fremont, CA

Fremont California Real Estate Yearly Market Analysis

By Andrew Hong

 

Today I am going to introduce my annual Fremont California Yearly Market Analysis…starting this year.  So congratulations on being some of the first readers of my long tradition!  Almost every time I meet a new client, they will ask me this question, “so how’s the market going?”  And there will never be a right or wrong answer to that because it varies greatly by location.   Sure, the market is doing great here in the Bay Area, but what about Sacramento?  Ehhh…not so great.  I can give you a broad and vague answer that encompasses the entire nation but what good is that to you?  So, now how does one answer this question correctly?  One can by simply using facts and analysis.

I’ve gone ahead and crunched a few numbers comparing the sales between this year and the year of 2011 in Fremont, CA:

 

Year 2011

Sample Size1331
Average Sale Price$612,381
Low$118,000
High$2,488,000
Median$532,000
Average DOM"40.43
Average Sale $/sqft343.555891
Average SP - LP($12,345)


Year 2012
 

Sample Size1464
Average Sale Price$659,833
Low$180,000.00
High$3,465,000
Median$579,700
Average DOM"29.11
Average Sale $/sqft362.77
Average SP - LP($593)

Now let’s see how the trend is going between the two years. In terms of number of listings sold between the two years.  There was a small increase in about 10% of listings sold.  This shows that people are beginning to sell again, though 10% isn’t enough to draw any conclusions. 

In terms of sales prices, in 2011 the average sales prices for single family homes in Fremont, CA were $612,381 while in 2012 it was $659,833.  That’s a difference of $47,452 or in other words a 7.75% increase from 2011.  That’s a pretty significant increase in my opinion.  Therefore, one would say that overall the sales prices in Fremont, CA have gone up about 8% compared to the previous year.  However, the high for the year 2012 is also higher at $3,465,000 which could have possibly affected the average sales prices.  You may also infer that more luxury homes were sold in the year 2012 than the year 2011.  This statement is also supported by the median during year 2012 was higher than the median for 2011 at $579,700 and $532,000 respectively.  My point being is that in order to evaluate the trends we cannot solely base it on sales prices.  Therefore, let’s move on.

The average days on market in 2011 were 40.43 days while in 2012 it was 29.11.  This is a decrease by 11.32 days or -28%.  I believe this is very significant.  This means that people aren’t waiting on listings anymore.  Buyers are no longer waiting for listings to grow old and lower their listing prices before writing their offers.  This signifies a shift from a buyer’s market to a seller’s market, which could mean much more to come.  I imagine if I were to do this analysis again in 6 months, the numbers would be more drastic.

The average $/sqft for 2011 was $343.55 as opposed to in 2012 it was $362.77, an increase by 5.6%.  This is very significant and let me tell you why.  We already stated earlier that the average increase in sales prices was 7.75%.  Now that we know the avg. $/sqft has also risen a significant amount we can eliminate the chance of outliers skewing our sample.  We can also mitigate some, not all, of the impact from inflated sales prices of luxury homes.  With this, we can say that the market has definitely gone up between the two years in Fremont, CA.  One can even confidently say that the market in Fremont, CA has gone up about an average of about 5%.

Last but not least let’s talk about the difference in sales price from list price.  Notice how both years are in the negative, meaning that there are more listings selling for less than asking price.  In 2011 the average difference was -$12,345 and in 2012 it was -$593.  WOW.  Look at the difference in these numbers.  I was actually surprised that the number was still in the negatives for 2012.  This goes hand in hand with the decrease in the days on market.  Typically as a seller, you want your home to sell within the first 3 – 5 weeks if you want to get the most money for your home.  In 2011, homes were on average on the market for over 5 weeks before finding a buyer, while in 2012 it was taking just under 4 weeks.  This yet again, shows evidence of the market shifting from a buyer’s market to a seller’s market.  People are beginning to offer more than asking price, and the only time this happens is when there are multiple offers.

After going through this analysis, I hope this helps people understand “how the market is going”.  The market is going just fine and I believe it’s going to grow at a gradual rate in the upcoming year.   I don’t see anything that will drastically hold it back or hinder its upward movement.  However, nobody can tell the future, if I could, I would be playing the stock market. If this analysis interested you, then I can do something similar for any other areas you are interested in as well.  Just send me an e-mail or give me a call and I can give you some data to work with.  Have a great day everybody and happy holidays.

 
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