I have three things on my mind today. I’d love to share a helpful analogy for today’s housing market, let’s talk about unrealistic seller expectations, and then unpack some fresh stats.
Real Estate Week: Next week I’ll be taking part in a free video interview with The Sacramento Bee to talk about the insanity of today’s market. I’ll be talking shop on the first day on August 23 at 12pm. Sign up here.
1) Speeding and slowing car analogy: The housing market is like a car speeding on the freeway that recently let up on the gas. It’s moving really fast, but it’s also slowing. Both things are true at the same time. I find some people fixate only on slowing or only on moving fast. My advice? Pay attention to both.
I like this word picture because it recognizes the speed of the market and recent seasonal cooling. In my mind fixating on only one of these things is a mistake that can cause misinterpretation of trends. Of course a narrow focus for some might also be due to an agenda.
2) Unrealistic seller expectations: Sellers are by far still in the driver’s seat in today’s market, but it’s a good time to weigh expectations as the temperature of the market has been changing. I’ve been hearing a few disappointed sellers say stuff like this: “We only got two offers and only went $12,000 over asking.” I get it because the expectation was to have thirteen offers and go 15% over the list price. But that’s just not always going to happen. My advice? Price reasonably according to similar listings that are getting into contract and adjust your expectations as the market temperature changes.
3) Fresh neighborhood stats: This image shows how much buyers paid above the list price in various areas for sales between July and mid-August. In short, as I keep saying, the market is slowing, but that does NOT mean it’s slow. Those are two different things. Keep in mind these are averages, so they don’t perfectly represent each individual escrow. In other words, some properties sold for way more and some for way less.
NOTE: One thing to remember is these stats are based on sales, which tell us more about the past when these properties got into contract in June most likely. The current market is best seen in the listings and pendings.
Thanks for being here.
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Questions: What do you think of the analogy? What are you hearing from sellers and buyers? I’d love to hear your take.