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Real Estate Roundup by Sharon Alva: List It

Submitted by on 1, January 22, 2010 – 5:50 am2 Comments

-14Common wisdom (which sometimes is neither) says that this is not a good time to sell your home. Prices are down, CW says. And while it’s true that in some areas prices are down, and even in Alameda prices are down for town homes and condos, there are tons of buyers. And they have nothing to look at.

“Tons” is obviously not the most scientific measurement of the supply of buyers for a particular property, but touring homes with clients, I can tell you we are rarely there alone. Someone else has just come in or just gone out. In 2008 it did not feel that way. And even in 2009 the trend changed. But now the traffic is high, and anything priced reasonably gets a fair amount of attention. More than ever, over-pricing is the death knell of any property. But price a home within reason and the buyers will come.

As of Wednesday we have 65 properties for sale in Alameda; very low inventory. The breakdown is as follows:

1 Duet
5 Townhouses
11 Condos
48 houses

Once the buyer throws in their personal requirements for size, location and condition, there may be no houses for them to see at all. In fact, the West End (the most underrated, awesome part of Alameda) has only two properties for sale. One is a tiny one-bedroom cottage and the other is well-priced and located, but does not have the traditional layout some folks might want. So if your heart’s desire is the West End, you are forced to wait.

The other consideration for waiting is usually the spring season. There is a sense amongst sellers, and often their agents, that it would be better to wait for March when the hot spring season begins. But creating pressure to buy before that time is the federal tax credit for first time buyers, which will apply only to transactions in escrow by April 30 and closed by June 30. Interest rates which have been remarkably low will also start creeping up by midyear, so buyers feel the pressure to lock in a loan early.

Last but not least are the particulars of this recession. Many folks took a wait-and-see attitude in 2008, staying out of the buyer’s market. But by mid-2009 they were fired up about making good use of advantageous loans and jumped back in. So there are buyers now in January looking for the right property. Sellers have every reason to jump in now, rather than waiting to be part of a larger group placing their houses on the market in March.

The caveat to all this may be obvious but should be noted. Prices are still down from their peak, so if you bought in 2005, 2006 or 2007 and you can hold on, that might be a better course. While we saw a small rise in value from 2008 to 2009, it will take some time to recoup the losses we saw in 2007 and 2008. Each situation is different and talking to your Realtor, tax professional and lender will help you make a prudent choice. But for those who are ready to pull the trigger but are biding their time until the spring … list it.

2 Comments »

  • Barbara M says:

    I am really enjoying these words of wisdom from you. I have no plans on selling my house but I have to say when you think about it 65 properties for sale isn’t anything. I think we have been pretty lucky here that prices haven’t fallen the way they have in some places. I think people still value a sense of security with nice neighbors and wonderful place to raise kids.

  • G. Pet says:

    Let me second the point to list now, if for a different reason. Alameda has not even begun its serious price declines. It lagged the rest of the Bay Area on the way up, and it is lagging on the way down. The lag on the way up means that there are an enormous number of Neg-AM, ALT-A loans on the island that accounted for the runup from 2005-2007. Many of these will default, and the number of foreclosures will increase – substantially.

    This will be fed by California’s recession, California’s state-government collapse, and California’s unemployment rate which is already enormous. Remember, at 600k houses, the vast majority of households require two moderate-high income earners. It only takes a change in employment for one of them to force a sale. Think about how many UC and State Government workers are going to be out of jobs or already area. Ditto for tech companies, media companies, and muni-workers – all consolidating and downsizing.

    It’s going to get worse from here, not better.

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