@Elt1, what’s the rationale behind 5 months of DOM? I don’t think I have seen more than 2 months in the Bay Area. That too just during 2009-2010.
I agree on this one. The number of visitors in open houses in desirable locations are much more.
Investors should not be in this market. Plus they have a great stock market for investment.
Bidding war frenzy is going down big time (compared to earlier) in MV and SB. Personally talked to two realtors who confirmed this. So chances of landing a house are more now.
No bidding war only if listing price is already high. Going through one right now.
Plenty of cash investors, esp realtor-builder-flippers, are there in good locations. Since they are realtors, they have better idea about the location rates, have enough cash to build and they also know how much margin, after flip,…etc. Since I was looking at 8k+ lot homes, most of my competitors were realtor/builder/investor category. Above all, they waive off buyer commissions as they represent by themselves and they provide best market rate which is tough to compete. I have faced the competition in four of six different homes I participated. They are the toughest to beat in our market as they can compromise 50k-100k from their would be sale profit !
5 months is a national standard where in most markets 6month DOM is a normal balanced market. It takes 5 months to build a house in most places. Inventory below 6 months means it is time to build.
Of course in the BA the normal standard doesn’t apply.
Because even during the deepest recession there was still too little supply. Just not enough qualified buyers.
Like I told everyone on the old Redfin forum that was the greatest time to buy in BA history. Even then there was still only about 1% of inventory turnover every year. Nationwide it is usally 2-3%
Thanks for the explanation, @Elt1. You are right in that bay area had low inventory even during the recession. Not sure if you remember but I spoke with you over the phone regarding a prospective home in 2012. You gave me great advice on slab foundation vs crawl space foundation.
what was the advice?
I will let him answer but in a nutshell he advised me to stay away from slab foundation homes.
why? it is mainly because of accessibility to pipes and electricals?
Yes, and the difficulty of adding heating.
Yes, my Architect also suggested not to go for slab foundation as it is not flexible to change or add on …etc
A couple of benefits to slabs: cheaper, faster to build, less prone to termites and lower height of foundation (so your house can be higher)
Correct, my architect was telling that Slab Foundation is preferred by big builders (like Toll brothers…etc) and they normally go for it, not by small builders.
Slabs are cheap. You get what you pay for. And cold on your feet. Unless you use radiant floor heat
But all commercial buildings are on slabs.
On expansion soil they use 8” thick slabs with extra reinforcement and post tension cables.
Really? Why homes get into contract quickly throughout any remote community in SFBA then? That includes part of north San Benito County as well.
This is San Mateo County all residential types
This is Santa Clara County inclusive of all residential property types
This would be a good indication of a turn towards buyer’s market to me.
That said, I am not seeing this in Redwood City. Marginal neighborhoods going for $1K/sq ft and going quickly. But if San Jose’ is cooling, maybe that will move towards peninsula. The realtors do sound like they’re seeing fewer offers, but from what I hear, those offers are still 10-20% over ask. I think people are just getting smart on their tactics. If they can’t bid over ask, they don’t bother.
You are right that only serious buyers are bidding. A Fremont house we were interested in went pending last evening after being in the market for just 5 days. There were only 5 offers but all of them 10% over asking. Asking price was already high (850K for a 3 bed, 1bath). This is the second time we lost in our bid this week.
I will view current situation same as 2016, and see what happen around Jul/Aug.
year over year inventory is still down, though weekly/ monthly sequential is up.