A few weeks ago I wrote about how the market seemed to be taking an aggressive jump as the Spring Real Estate took off. We seemed to be getting into a market of multiple offers, and properties once again going into contract well above the list price. It was a surprising change, and early in the season, I was unwilling to say whether it was just the normal Spring up tick, or an actual shift in the market, though my gut told me it was just a seasonal shift.
We are now a little further into the year, and I am willing to take more of a stand. When you look at home values this year compared to last year, they are basically flat with a slight increase of just .9%. That is from Dataquick.
But what is making it seem like such a lively market, so many offers, so many going over list price?
Part of part of the reason is that there are even fewer homes on the market in the relatively hot areas like Albany and Berkeley. We've never had a large inventory of available homes anyway, and now there are even less. You have the same number of cats, buyers, chasing even fewer mice, available homes, so from the outside it looks like a lot of activity. You also have the situation where sellers have really caught on to what is happening in the market. They could hardly miss it with the nightly news filled with stories about the bubble bursting. Home sellers had to figure it out sooner or later, and for the most part, they have. The result is that they are pricing their properties even lower to match the market. That just makes the cats scramble even more.
That is why in a market that is basically flat when compared to this time last year value wise, even though it can often feel like there is a lot going on.
Sellers should still be happy. A flat market is a lot better than what is going on elsewhere in the nation. Buyers should still be happy too. Instead of seeing home values rise out of reach, they are still where they were last year, and so are interest rates.
