|
|
|
THE DAVIS CALIFORNIA REAL ESTATE
NEWSLETTER
Note from Joseph: "A big New Year's hello to my clients,
friends, and subscribers. In the past five months,
housing prices in Davis have begun to decline. The Fourth Quarter
data gives cause for some concern, as sales slowed considerably, both in
absolute terms and vs. last year's numbers. As of this Newsletter, there
have been 15 pending
sales in Davis in the last 30 days. The house/condo/halfplex inventory
stands at 114 units. There is now more than six months of inventory on the
market, although this figure is somewhat misleading given that sales are
bound to increase as Spring approaches. Still, the overall
market is clearly in technical "buyers' market" territory.
On the positive side, Davis still does not have the problems in the sub-prime area that
Sacramento has, and there
are still very few foreclosures. There is no significant new
construction on the near and intermediate-term horizons. The Spring
season will be very telling. I will say that it is difficult to
see how regional prices could get much lower, given that you can now get
a home in Sacramento or Woodland at or very close (or even below)
replacement value. But with banks unloading properties and
defaults continuing apace, who knows?
The good news is that buyers now have lots of bargaining power,
though the selection could be better (right now it is seasonally low).
I've been advising my clients since September 2007 (when it became
apparent that the market was slowing) to either find a very
good bargain, or wait (which makes for slow business, as my wife will
hasten to point out). Most sellers are still unrealistic
about the value of their properties, so deals can be difficult to put together. In this market, it
continues to be imperative that buyers be willing
to walk away if they can't get the deal they want.
Joseph Whitcombe is a REALTOR, real estate broker,
and attorney at law, and holds an economics degree from UCLA. Mr. Whitcombe
specializes in serving buyers and sellers of homes, condos, and
investment properties in Davis, California. Whitcombe & Co.
had the highest average transaction value of any real estate agency in
Davis in 2005 and 2006.
"I'm here to help,
and I need and appreciate your business. If you need a REALTOR,
please give me a call at (530) 219-1000..."
Email Joseph at: contact@davismls.com
|
|
|
|
|
|
|
|
In This Issue:
|
| |
* January 2008 Real Estate Market Report For Davis |
|
* Listings of note |
|
* Interest rates headed down? |
|
|
January 2008 Market Report For Davis:
Slow sales, time on market holding steady, overall inventory
moderate to low in normal seasonal trend, and prices appear to
fall off |
| |
The fall and winter months tend to be quite slow in terms of real
estate closings. The Fourth Quarter of 2007 was slower
than usual. In December, there were only 20 closings,
compared with 30 in the same month last year. November
2007 saw only 19 closes, vs. 30 in November 2007.
October 2007 was also far behind October 2006, with 19 sales
vs. 28, respectively.
In December 2007, the average time on market was 70 days, a rise from
the 45-60 range in the Third Quarter 2007. Overall
housing prices
using my favorite measure, median price per square foot,
plunged to $286.54 in December, after staying in the $300 to
$320 range for almost a year. Prices according to this
metric have not been so low since mid-2004. The average price per square foot
also dropped to $302.00 in December, down from the $310.00
to $330.00 range. On the other hand, the volatile median
sale price actually rose a bit to $524,000, from lows at
about $510,000 in May and July 2007.
Taken as a whole, the data show that prices have
fallen significantly, and appear to be in the midst of a
decline. Still, it is very difficult to draw any
concrete conclusions based solely on activity during the
winter months. It is worth noting that last year,
Spring and Summer 2007 prices bounced significantly upward
from the lows of December 2006 and January 2007.
The overall inventory of homes, condos, and halfplexes in
Davis is now 105 units, moderate to low, as expected for this time of year. We will see a flood of
new listings this Spring, many of which will be properties
that did not sell in 2007 and were pulled from the market in
hopes of finding better market conditions in the Spring of
2008 (this may have been a bad bet).
|
|
| Price Range |
Current
Market Conditions |
| Up to
$300,000 |
With 5 listings and
1 sale in the last month, this price range is currently in a technical "neutral market".
Price concessions have recently been quite large, in the
$10,000 range.
|
| $300,001-$400,000 |
This
price is in a technical "buyers' market".
There are 16 units on the market, and three sales in the
last 30 days. That's an inventory of ten months and a buyers' market. Price concessions have
been somewhat erratic, but generally, buyers should try for about
$20,000 off
the list price.
|
| $400,001-$500,000 |
With 26 units on the market, and
only one pending sale in the last
month, this price range is now in a "buyers'
market". This looks like a pretty major
glut of inventory in a normally very healthy price
range. You should drive a hard bargain, or better
yet, wait. Sellers may have to seriously adjust
their expectations.
|
| $500,001-$600,000 |
There are
18 units on the market, and two pending sales in the last
month. There also appears to be quite a few homes
that did not sell last year waiting to re-list this
Spring. This market
segment is now in "buyers' market"
territory.
|
| $600,001-$700,000 |
Inventory
in this price range is currently 15 units. There have
only been two in the last month, for an inventory of
over six months. Thus, this market segment
is now in a technical "buyers' market."
|
| $700,001-$800,000 |
Inventories
stand at eight listings in this price category. With
only one pending sales in last 30 days, this price range
continues in "buyer' market" territory.
You can probably negotiate at least $30,000-$50,000 off an average home
in this category.
|
| $800,001-$1,000,000 |
With 18 listings, and
four pending sales in the last 30
days, this price segment is now experiencing technical "neutral' market".
There continues to be relatively strong demand in this price
category, where you can still get a very nice house
for under $1 million. Price concessions may be
rising in this range, however,
|
| Over
$1,000,000 |
Inventory
in
this price range is now at 15 listings, and with three pending sale in the last 30 days, this segment
continues in "neutral market" territory.
There appears to be around 10 buyers shopping in this price
range.
|
| Income
Properties |
With 18 listings and
no pending sales in the last month, the income
property market has moved into technical "buyers' market"
territory. Sellers are asking too much for
their properties, given that you can earn up to 6% on
your money in a savings account.
|
| Estimates
reflect Whitcombe & Co.'s subjective assessment of
Davis real estate market conditions based on sales and listing
data from the MLS, general
market activity, and buyer and seller attitudes. A
sellers' real estate market is indicated when homes sell quickly at
or above their listing prices, and/or when inventories are
low. A
neutral real estate market is indicated when homes sell at or just
below their listing prices within a reasonable period of
time, and/or
inventories are moderate. A
buyers' real estate market is indicated when homes tend
to sell for
significantly less than their list prices, remain on
the market for longer periods of time, and/or inventories
are high.
|
|
|
JInterest Rates On the Decline? |
|
Interest rates on the 10 year U.S. Treasury Bill have fallen
dramatically, and are now under 4.00% (they were at 5.00%
not too long ago). Interestingly, mortgage rates have
not fully reflected these lower rates yet. Problems in
mortgage lending have apparently caused lenders to hesitate
to lower rates, as they are not sure about the value of the
security behind their loans (i.e. houses). Republican
Presidential candidate Ron Paul has been warning about
potential inflation and thus credit problems associated with
printing too much money in connection with the Fed's
practice of artificially pegging interest rates to
low. The markets may be proving him right (but I hope
not).
|
| Listings of
note: These are listings I believe are special because
of the quality of the property or the price. Prices
reflect a target price rather than the list price. |
|
Northstar 4/2.5 for $899,000: This is a truly cool
home, an architect's pet project. One of my favorite
homes in town. It's not on the market yet, but its
coming soon. If your interested, please give me a
call. I'm actually considering buying this one myself.
BANK OWNED IN MACE RANCH for $500,000: A 4/2
bank owned. Great floor plan. INCREDIBLE
DEAL. You could probably flip it and make
$50,000.
There are currently tons of listings that did not sell
last year waiting to come back on the market this
year. If you want to buy this year, their will be some
good deals on some exceptional homes.
|
|
|
You are receiving this
Newsletter because you registered for Whitcombe & Co.'s MLS
feature. To automatically unsubscribe
to this newsletter, reply to this email and write
"cancel" in the subject line.
|
| |
|
|
Contact
Info |
Technical Inquiries |
Privacy Policy
|
Terms of Use
|
Licenses
|
Fair Housing
|
|
|
The information in this
newsletter is thought to be accurate, but not guaranteed and should not
be relied upon for any reason. The opinions in this Newsletter are
provided in good faith, but are not guaranteed to be accurate and
should not be relied upon. If you want advice you can rely on in
making decisions about real estate matters, you
should directly consult a real estate broker. The information
regarding market conditions in this newsletter was derived on Feburuary
2, 2008, and is believed to be accurate as of that date.
|
|
Copyright
© 2008 Whitcombe & Co., ALL RIGHTS RESERVED
|
|
|
NEED
REAL ESTATE SERVICES? CALL
JOSEPH AT (530) 219-1000