We read many articles about the real estate market, and sometimes our eyes glaze over. This stuff is important if you are thinking of buying or selling, but often it’s not easy to make sense, what with numbers, charts, graphs all pointing in different ways and saying something that may be forgotten by the end of the article.
We try to give you capsule comments about the Nation, California and our local real estate market, and we try to do it in a way that keeps yawns to a minimum. The bottom line for most of 2014 is relatively easy to capsulize:
• There will be more homes for sale
• Homes will be more expensive
• Buying will remain cheaper than renting
• There will be fewer frenzied buyers
• Repeat home buyers will be a primary force, rather than first time or investor buyers
• Loans will be easier to get
• Interest rates will be higher
Here are some details, mostly about our Pasadena market.
• The number of homes for sale in Pasadena’s real estate market dropped by 20% from November. That’s the holiday season so if we look at last December instead, the number for sale increased this year, by a bit over 2%. The number of months of inventory dropped too in December, from over two months’ of inventory since June to 1.8 months in December. Last December there was less than two months’ supply too.
• The number of properties sold in Pasadena was about the same number as November, so fewer homes for sale but more sold will usually translate to increasing sale prices, and it did.
• We measured the median price (half sold for more and half less) and saw that Pasadena’s median increased from November to December, by 8.6%! To confirm the rise, we looked at the average price per square foot of sold properties. Up six percent from November! Part of this may be that more expensive homes were sold in December, but nonetheless, prices seem firm and rising.
• Many ask us if they should list higher than the expected sale price to leave room for negotiations. But, If one lists too high, buyers will compare that home to homes in the higher bracket and the property may look weak in that comparison. We think it’s better to price at or very near the expected sale price, and the numbers show that’s good advice. The sold price vs list price for all of 2013 in Pasadena was never lower than 98%, and in seven of 12 months the sold price vs the listed price was 100% or higher.
• Pending sales in the Pasadena real estate market represents properties in escrow but not yet sold. It is supposed to show what is ahead in a month or two. That category steadily dropped from July to November, as did closed sales. The December pending sales were at the same level as November. It’s hard to determine what that means for the next couple of months, but a steady downturn suddenly turned flat is not a bad indicator.
We hope this is helpful, but feel free to email or call us for further insights. And thank you for visiting AroundTownPasadena.com