Sudden surge in inventory?


#21

Ok. NONE of their indictors seems to show a slow down in mid-peninsula.


#22

it does not have may numbers.


#23

True. But the experience about suddenly seeing more street signs is valid. In SM the jump between Mar and Apr is substantial. I missed this between last 2017 Feb and Mar though :slight_smile:

Let’s wait for the May data to catch up. Nothing Earth Shattering. Inventory is at historic lows.


#24

Why are you selling your apartments. Are you getting out while the gettings good?


#25

Like I said earlier, last year Fremont inventory went down in July and back up in August. When people decide to sell in summer which is the peak season, they will list in June, July, or August based on their convenience. You need to look at the sum total of the season instead of month over month to know if the inventory is going up or down.


#26

They are too much work for me, and I don’t hire property managers…I don’t trust them…They don’t maximize rents and gouge you on repairs…I have a great down leg 1031 planned…I am a flipper by nature…I added 80% in value on these apartments in 2 years and have another deal where I can do the same…I try to maximize IRR…there is no way I can add another 80% to my current deal. But a good possibility on the next one. I look for value add. Once the rents are stabilized my IRR goes from 50% down to 15%.


#28

Just read a piece in the San Diego Union Tribune. Inventory was up 1.9% in April over last year. This was nationwide.


#29

I have heard this anecdotally too, that just in the past couple weeks there has been a shift towards more inventory and fewer buyers. I think the 2018 FOMO Frenzy is over…for now.


#30

Apparently the winning offer for a 3 bed, 1 bath SFH in Newark that we were trying to buy is 100K over asking. The price is all time high for such a small home in Newark. Inventory is there but so are crazy prices and buyers. Homes in good condition are selling really fast. This one went pending in 5 days. There are homes that are not so desirable and they are sitting in the market adding to the inventory. Those guys are better off selling in Fall or winter I guess when people may be desperate due to very low inventory.


#31

Newark used to be under $400K when I first looked at it like 5-6 years ago…craziness


#32

I have heard from realtors in SBay that inventory has doubled and bidding wars have softned with buyers tending to wait it out.


#33

Inventory everywhere is still historically low. But rising interest rates could cut the number of buyers


#34

In the area(San Jose) i have looked recently, i saw/see increaded inventory with homes on not desirable location (close to busy street / high way, high voltage power line etc.
One house was sitting in the market for a month and then got removed from listing. Most of them were sold at listing price but after sitting in the market for quite long time.
On the other hand, houses on the good location were sold at 20% over asking price and i got outbid in multiple cases regardless of house condition.
What i notice is that buyers become picky yet are still willing to pay high premiun if they like it.
One of the house i got outbid received 7 offers 2 days after the first open house. My bid was 15% over asking price and the house was in original condition (no update at all).
I guess there are plenty of capable buyers but they are willing to wait as well.
I guess there are plenty of sellers of homes in not desirable location who want to sell before any correction comes. They probably drive up inventory and DOM.


#35

DOM???


#36

Btw, I thought this was the case even earlier.


#37

Days On the Market


#38

What i am seeing is larger gap between good and bad location.
For example, houses on busy road, their price didn’t go up compare to similar homes/location 3-6months ago. On the other hand, houses on good location went up 30%.
What does it mean?
I guess it means less investors and more primary home buyers.
This could be an indicator that we are near top (otherwise, we should see more investors).
However, given the strong demand of primary home buyers, i don’t expect real correction either.
Thus, it will stay flat for a while, i guess.


#39

There may not be traditional investors but companies seem to be putting their excess cash into Bay Area real estate. Facebook is putting $1B into Menlo Park. That will continue for a while to keep prices going.


#40

Watch the unemployment rate. BEST leading indicator.
Also watch DOM anything less than 5 months is bullish.
5 weeks extremely bullish. 5 days insane


#41

8-9 days in my neck of the woods.