Market Trends

The Sky Is Falling!!! - Or Is It?

In my trends report, I’m going to share with you how we're seeing the demand curve flatten out and inventory slightly increase. The headlines you are probably seeing can seem a bit like "The sky is falling!" I want to paint a real picture of what's going on in our market right now.  I’m going to do this by comparing two months ago to what is happening in today's market update.

TWO MONTHS AGO I WOULD HOLD AN OPEN HOUSE AT MY $1 MILLION PROPERTY LISTING. THIS WOULD HAVE:

• Received 30 to 40 showings over the weekend

• Generated 10 to 15 offers

• Half price negotiated over asking in favorable terms to the seller, and we would have been done.

FAST FORWARD TO THIS LAST WEEKEND; A COMPARABLE $1 MILLION PROPERTY LISTING WOULD HAVE:

• Received 15 showings over the weekend

• Generated 4 offers with 3 over asking

• Again a great deal would be negotiated in favor of the seller.

It can be confusing when you hear the news or read articles, thinking that demand is really pulling back and things are slowing down. While things are more slowing, I'm still seeing multiple offers on properties, and still going over asking price.

How is that possible?  Here are the facts that you need to know:

1.      The main driver on that is inventory. Yes, inventory is slightly increasing, but it's just nowhere near where we need to be in order to actually slow down the crazy market that has been happening over the past several months.

2.     Although rates have gone up 2.25%, half of our offers that are coming are cash, so rates are not affecting THOSE buyers. The other ones are thinking, "Well, maybe I'll go ahead and rent right now." That might be a great option, but rentals are even more scarce and pricing on rentals is through the roof. These buyers have a need to be living in this area and so they go ahead and buy anyways, which is still driving the market.

I expect this to be a strong market throughout the summer.  However, keep in mind that there are properties that are on the fringe that may have some issues or aren't the nicest property on the block.  These properties will no longer be able to receive the same previous multiple offer situations unless they're priced right. That's where we're going to see a slight change in the market. 

Properties in high demand are still going to be very busy.
As always, if I can offer any assistance or answer any questions, please give me a call or send me a text at 805-268-3551.

SAN LUIS OBISPO COUNTY HOUSING
MARKET TRENDS MAY through JULY 2022

The active listing inventory was:
SINGLE FAMILY HOMES

MAY 277 - 6.40%

JUNE 284 -11.74%

JULY 233 -22.41%

CONDOS

MAY 72 8.64%

JUNE 64 8.93%

JULY 80 5.66%

With supply inching higher, the Expected Market Time, the number of days to sell all San Luis Obispo County listings at the current buying pace, is expected to increase. Still an insanely Hot Seller’s Market (less than 60 days)! Why do you think Condos are coming on the market with such positive increase in sales? I would love your feedback! Email me here!

Let’s talk foreclosures.  I am of the opinion that you will not see a glutton of foreclosures come onto the market anytime soon.  “And why do you feel this way, Rebecca?”, you may be asking yourself.

I’M OF THE OPINION . . . that you won’t the market be flooded with foreclosures like what happened in 2008 because the lending institutions are taking precautions against it.
Banks know they are not getting a bail-out again, so they are opting to negotiate on accounts that are in arrears.  They are offering different programs to help people get out of forbearance; such as refinancing programs or adding the amount in arrears to the end of the existing loan and extending the loan period accordingly.  They don’t want to be left hold the bag because they aren’t in the business of homeownership.

"People don't care what you know until they know that you care".
~ Rebecca ~