Home Buying in Pleasanton>Question Details

NervousB, Home Buyer in San Francisco, CA

Low inventory in Pleasanton or bay area in general... why and when do properties typically pop up on the market?

Asked by NervousB, San Francisco, CA Mon Dec 3, 2012

I'm sure sellers wouldn't want to be hassled with negotiations and moving during the holidays, but are there other reasons why there aren't homes under 1M this winter? Would August/september be a decent time for buyers?

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NervousB,

No need to repeat what has been so succinctly posted regarding your primary questions. Instead, here's a “from-the-numbers” snapshot of what has occurred over the last 24 months.

Specifically for Pleasanton (resale single family detached homes up to $1M Nov 2010 - Nov 2012) reveals:

1) Months of Supply of Inventory has significantly dropped from 3.6 months to 0.8 months (a 77+% decrease).

2) Average Days on Market over the same period has dropped from a high of 73 days (Oct 2011) to around 23 days (a 68% drop in time).
1 vote Thank Flag Link Tue Dec 4, 2012
I love your nickname.....it is a nervous time to be on the market as a buyer....no matter what you put your hands on, there will be other people interested in it too.....although you are right about the seasonal slowdown, I do not anticipate the inventory level to proportionally improve anytime soon and waiting be a good strategy. With the economy recovering and mortgage interest rates staying at all-time historical low, expect the condition to stay the same or get worse.

Team up with a competent local Realtor, one that has the in-depth knowledge of the market and lean on him/her to get you through the complication of the market. There are people buying homes every day and there is no reason you cannot be one of them. Best of luck to you on your home search.
1 vote Thank Flag Link Mon Dec 3, 2012
More homes typically come on the market in April or May, but then there is more competition for them. Homes are on the market now, but throughout the bay area, inventory (number of homes on the market) is down anywhere from 50% to 75% from last year.

Why? People who would downsize or upsize don't have equity, or still could not sell their homes for what they owe, and they need some money for their next down payment. Banks are not releasing many of their owned properties, and more people are able to renegotiate their mortgages with the banks so they are able to maintain their payments and are not forced to sell.

So practically the only people selling now are those that have to. There are a few that have equity and want to move up or out, but basically, it is those that must sell - health, transfers, job loss, etc. And I don't really see much change in it - demand is way stronger than supply and seems like it will remain so for awhile.
0 votes Thank Flag Link Tue Dec 4, 2012
NervousB:

You have a few questions:

Q: “Low inventory in Pleasanton or bay area in general... why and when do properties typically pop up on the market?”
A: Properties pop up whenever a seller decides to put it on the market. WHY? The reasons vary like snowflakes – job relocation, death, marriage, kids, foreclosure, short sales, moving up, need more space … etc. WHEN? Whenever a seller decides “it’s time.” Could be anytime – even during the Holidays.

Q: “I'm sure sellers wouldn't want to be hassled with negotiations and moving during the holidays, “
A: If they need to sell, they’ll go on the market anytime – even during the holidays. We sell lots of homes every December. It totally depends on their motivation for selling.

Q: But are there other reasons why there aren't homes under 1M this winter?
A: Inventory is VERY low for a number of reasons. We’ve been low since March, 2012 because there are so many buyers out there right now trying to get a home – especially First-Timers. It’s a perfect storm: a pent up pool of buyers who realize the bottom has come and gone, unbelievably low mortgage rates, sellers waiting for the market to increase to get a better return when they sell … there are a number of reasons every home that hits the market is snatched up immediately. Lower priced homes are evaporating, while higher priced houses sit a wee bit longer.

Prices have been pushed up by the lack of inventory (not by the economy) and, until we see more sellers willing to sell, we’ll continue as we are with short inventory and increasing prices.

Q: Would August/september be a decent time for buyers?
A: The normal buying cycle begins in early spring as sellers start putting their homes up for sale. Sales typically increase as we head into the summer and normally peak in July/August. They taper off as kids go back to school and slow even more as the holidays approach. However, there is nothing “normal” about the current market, so all bets are off as to when the best time to buy really is. In fact, if you wait until next August, there is a very real chance prices will be substantially higher. We’ve already seen massive hikes in prices since march, and it doesn’t appear to be slowing down even a tiny bit.
0 votes Thank Flag Link Tue Dec 4, 2012
Dear Nervous B,

Buying a home today is challenging and as my friend Steve M states you need to select an EXPERIENCED REALTOR(R) to help you navigate your way in this low inventory market...it's more than just the highest price there are other ways to package your offer to make it attractive to the seller and their agent so yours is the offer they select.
If you know a neighborhood that is of interest to you and you find an experienced REALTOR like myself or Steve M. we have ways to help find properties that may not even be for sale yet and in some cases you may be the only one who finds out about it but in most cases you will have others bidding on the home you are interested in...again it's about how your present your entire offer package not just the highest price.
Should you wish to discuss your options I would be happy to go into greater detail in person
Happy Holidays,
Michael
0 votes Thank Flag Link Mon Dec 3, 2012
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