Wednesday, September 26, 2007

Weekly Sales Report

Welcome to another Wednesday sales report. There was not quite as much activity this week than there was in weeks prior. New inventory is back down to regular numbers; sales were down a bit as well. There were 12 escrows opened this week as opposed to 18 the week before. There were 14 closed escrows. Of those, exactly half sold over asking. That statistic has remained fairly steady over the past weeks. Six sold under asking and the remaining one sold at asking.

With the surge of new listings that we saw at the beginning of the month and lower sales numbers this week, what does that tell us? There is a large number of listings still sitting on the market. The average days on the market, although it varies from neighborhood to neighborhood, is much longer than the two weeks we were seeing for so long. In general, the average is closer to 30 days. Don't be turned off by a property because it has been on the market for a month. Instead by happy you weren't forced to rush in and overbid.

Another trend I have been noticing lately is that sellers are deciding not to sell if they don't get the price they need. They are opting to hold onto the property; either live there themselves or rent it out. Homeowners who bought in the past year or two have not yet built up enough equity to make a profit on the sale of their home. In the past, San Francisco properties appreciated so rapidly that you could make money in a sale a year or even less after purchase. That has not been the case in the past two years; many homeowners are forced to hold onto their property longer than they intended. A property like this may sit on the market for a month or two while the seller tries to get their price. The buyers will see it sitting on the market and assume they can negotiate a lower price, but the seller will not negotiate. My point is, time on the market doesn't necessarily mean you can get the seller to lower the price.

People are always asking if it is a good time to buy. Nobody can tell you what lies ahead. Nobody knows whether interest rates will rise or fall, or whether home values will rise or fall. What I can tell you is that the longer you hold on to your property, the safer your investment.

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