We’ve been hearing about a “shift” in the marketplace, in hushed tones, for quite a while now. Buyers, Sellers and Agents have all been noticing subtle changes creeping into what has been a lopsided Sellers Market for years.
People reading the tea leaves have probably picked up on a few signs: One easy one is that there seem to be more actual real estate signs dotted around the landscape. It also seems like houses are staying on the market longer. And there are also more reports about price reductions. And a lot fewer stories about the ten offers the neighbor’s house just received.
Of course, the overall number of sales has been low for years but since the active inventory has also been at historic lows, it stands to reason there would be fewer sales. And while we’ve been hearing that the real estate market in Silicon Valley has slowed, to the uninitiated it still looks like prices are so high over there that it seems silly to think of any “softening”.
Some talk about a “shift” has been spurred by the general belief that markets can’t just keep going up forever. That they have to rest and come down every once in a while. And yet, there just hasn’t been a lot of “hard evidence” about an actual “shift” that anyone has been able to point to.
Until now of course… The trailing indicators have finally arrived to give credence to what people have been whispering about for months. Closed sales for Santa Cruz for September spell out the details and offer definitive handwriting on the wall for all of us to consider.
Median Price: DOWN from $930k in September of 2018 to $795k in September of 2019. For more than a year, the median price has hovered around $900k and this is more than a significant adjustment downward.
Days on Market: UP to 56 days in September of 2019 from 53 days in 2018.
% of List Price Received: DOWN to 98% in September of 2019 from 99% in 2018. This number is based on actual list price at the time of sale, not the original list price. The % of original list price number is much closer to $92% given the drop in median price.
Average Months to Sell: UP to 3.6 months in 2019 from 3.3 months in 2018. This is the longest it has taken to sell a home in quite a few years, signalling a slower, more balanced market.
Number of Sales: UP from 131 homes in September 2018 to 151 homes in September 2019. Translation: as prices were reduced, more homes sold.
More on the shifting market next week…