Under the Real Estate Dome

DomeIt was real estate stat time in the Sentinel this week.  Stats not tats.
Yes, there was also a big article about a Santa Cruz tattoo artist on Reality TV – but that’s another story.

I’m talking about the real estate sales data for the month of May that was published on Wednesday, June 26th – google it.  Average and median sales figures, unsold inventory index, year-over-year and month-to-month price comparisons etc.

Helpful in some ways.   Info that’s behind the curve in other ways.  But all in all, a great starting place for further discussion.

Since information presented in these monthly articles references transactions that closed a month earlier and were originally entered into by willing buyers and willing sellers at least another 30 – 60 days prior to that (in some cases longer)  we should all be cautious about making any hard and fast judgments or real time decisions based on loose interpretations of trailing indicators.

Like all news – old or new – aggregate data is fair game and great fodder for spin. It can be doctored up in all kinds of ways.  Used to provoke wildly different perspectives or prove all four sides of the exact same coin.

To create context and lend some interesting narrative to the calculus… the Sentinel reporter wove the numbers into a touching story about a young couple who have made 15 offers and received 15 rejections on 15 different properties.  The subheading read:  First time homebuyers feel rejected.

You think? To hear their story was excruciating.  Won’t someone please start a social media campaign? Issue a mayday distress call and general plea on their behalf? We should find them a house!

Isn’t there some nice seller out there, with lots of equity, willing to forgo squeezing every last dollar out of a sale?  Couldn’t they offer this deserving couple first dibs? No competitive offers? No overbids? No multiple-offer mania?

I was trying to imagine how many people I’ve worked with could have made it through 15 different offers without imploding.  Folding up the tent and going…going, well I guess not home. Not unless their future home was in Boise.

How much time and effort has this couple expended?  How many trips up and down the emotional rollercoaster can anyone take?  Usually after 2 or 3 rejected offers – the average person feels crushed and has to take an extended if not permanent vacation from the process.

I was wondering how their agent must feel.  Run through the ringer? Dispirited? Or heroically strengthened in their resolve?  Determined to see it through to the bitter end?  Perhaps there’s some crucial piece missing in their approach to the multiple offer puzzle? Or perhaps it’s just a cautionary tale for our times.

The story of a dedicated young couple trying not to lower their standards too much while suffering the slings and arrows and outrageous fortunes that an uncaring marketplace is commanding.  A market that is bigger than all of us.  That refuses to bend to any one individual’s will.

It amazes me that the couple could even find 15 properties suitable enough to make offers on. For most people looking at single family homes between $500k and $600k there’s not a lot out there that looks palatable or habitable let alone even close to a sliver of a termite ridden doug fir deck like that vision of their much-anticipated dream home.

The numbers from the story that stuck in my head?  Median Price of $625k.  A jump of more than 20% in a year.  Less lower-priced distress properties available. Fewer listings overall 633 – with 229 of those already pending.  Only 41 properties on the market in the entire County between $500 – $600k.  More than 150 active listings over a million bucks and way out of reach.

Here’s the thing … if you are trying to purchase anywhere in the $500 – $750k range  today – you might has well jump into the way-back machine because it’s 2005 all over again.   That’s the range almost all of you want to purchase in.

Looking at homes priced higher than$800k?  Now that’s a whole different story.

A fascinating glass-ceiling has settled over our local marketplace.  Like the mysterious one that just landed on the small town in that new TV show called Under the Dome.   Next week we’ll explore what the market looks like from the other side. Up there in the higher altitudes where the air is a lot thinner.


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