By Andrew Hong
Today I am going to introduce my annual Fremont California Yearly Market Analysisâ€¦starting this year.Â So congratulations on being some of the first readers of my long tradition!Â Almost every time I meet a new client, they will ask me this question, â€œso howâ€™s the market going?â€Â And there will never be a right or wrong answer to that because it varies greatly by location.Â Â Sure, the market is doing great here in the Bay Area, but what about Sacramento?Â Ehhhâ€¦not so great.Â I can give you a broad and vague answer that encompasses the entire nation but what good is that to you?Â So, now how does one answer this question correctly?Â One can by simply using facts and analysis.
Iâ€™ve gone ahead and crunched a few numbers comparing the sales between this year and the year of 2011 in Fremont, CA:
|Average Sale Price||$612,381|
|Average Sale $/sqft||343.555891|
|Average SP - LP||($12,345)|
|Average Sale Price||$659,833|
|Average Sale $/sqft||362.77|
|Average SP - LP||($593)|
Now letâ€™s see how the trend is going between the two years. In terms of number of listings sold between the two years.Â There was a small increase in aboutÂ 10%Â of listings sold.Â This shows that people are beginning to sell again, though 10% isnâ€™t enough to draw any conclusions.Â
In terms of sales prices, in 2011 the average sales prices for single family homes in Fremont, CA wereÂ $612,381Â while in 2012 it wasÂ $659,833.Â Thatâ€™s a difference ofÂ $47,452Â or in other words aÂ 7.75%Â increase from 2011.Â Thatâ€™s a pretty significant increase in my opinion.Â Therefore, one would say that overall the sales prices in Fremont, CA have gone up about 8% compared to the previous year.Â Â However, the high for the year 2012 is also higher at $3,465,000 which could have possibly affected the average sales prices.Â You may also infer that more luxury homes were sold in the year 2012 than the year 2011.Â This statement is also supported by the median during year 2012 was higher than the median for 2011 atÂ $579,700Â andÂ $532,000Â respectively.Â My point being is that in order to evaluate the trends we cannot solely base it on sales prices.Â Therefore, letâ€™s move on.
The average days on market in 2011 wereÂ 40.43Â days while in 2012 it wasÂ 29.11.Â This is a decrease byÂ 11.32Â days orÂ -28%.Â Â I believe this is very significant.Â This means that people arenâ€™t waiting on listings anymore.Â Buyers are no longer waiting for listings to grow old and lower their listing prices before writing their offers.Â This signifies a shift from aÂ buyerâ€™s market to a sellerâ€™s market, which could mean much more to come.Â I imagine if I were to do this analysis again in 6 months, the numbers would be more drastic.
The average $/sqft for 2011 wasÂ $343.55Â as opposed to in 2012 it wasÂ $362.77, an increase byÂ 5.6%.Â This is very significant and let me tell you why.Â We already stated earlier that the average increase in sales prices wasÂ 7.75%.Â Â Now that we know the avg. $/sqft has also risen a significant amount we can eliminate the chance of outliers skewing our sample.Â We can also mitigate some, not all, of the impact from inflated sales prices of luxury homes.Â With this, we can say that the market has definitely gone up between the two years in Fremont, CA.Â One can even confidently say that the market in Fremont, CA has gone up about an average of aboutÂ 5%.
Last but not least letâ€™s talk about the difference in sales price from list price. Â Notice how both years are in the negative, meaning that there are more listings selling for less than asking price. Â In 2011 the average difference wasÂ -$12,345Â and in 2012 it wasÂ -$593.Â WOW.Â Look at the difference in these numbers.Â I was actually surprised that the number was still in the negatives for 2012.Â This goes hand in hand with the decrease in the days on market.Â Typically as a seller, you want your home to sell within the first 3 â€“ 5 weeks if you want to get the most money for your home.Â 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.Â This yet again, shows evidence of the market shifting from a buyerâ€™s market to a sellerâ€™s market.Â 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 â€œhow the market is goingâ€.Â The market is going just fine and I believe itâ€™s going to grow at a gradual rate in the upcoming year.Â Â I donâ€™t see anything that will drastically hold it back or hinder its upward movement.Â 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.Â Just send me an e-mail or give me a call and I can give you some data to work with.Â Have a great day everybody and happy holidays.