Flipper/Rehabber · Los Angeles, CA · Member since 2017 · 66 posts · 35 votes
I talk to potential sellers every single day. I look at real estate listings every single day. I have now seen most closed listings (80-90%) closing below list price for months now. I believe we're in the middle of a correction in the LA market which most sellers don't even feel it yet. However, I predict this will change soon. The rate hike will help reduce the buyer pool so sellers won't get multiple offers unless priced right. Many overpriced listings sitting everywhere. Millennials don't want the same type of properties/things other generations wanted. I can't see those suburb tract homes being bought by younger buyers. They want to live closer to things, Uber/Lyft has changed how we get around and commuting for hours isn't as attractive anymore. Many more people now work from home and don't need all that extra space those homes built the 80's, 90's and 00's. Families are definitely not as large so those communities will see greater decreases in prices compared to more dense neighborhoods which will continue to be in demand for this new generation of home buyers. These are just a couple of my observations on the LA market but I for one, am looking forward to the opportunities that will arise once we're back in a buyers market out here. Thanks.
As an investor in SoCal, I can't say that I have noticed the same thing at least in OC, but suppose that one could fairly easily look at DOM and ask/sale price ratios from the MLS for significant increases. You wouldn't happen to have such supporting data in your back pocket, would you Alex? I sure hope you're right, though.
As an investor in SoCal, I can't say that I have noticed the same thing at least in OC, but suppose that one could fairly easily look at DOM and ask/sale price ratios from the MLS for significant increases. You wouldn't happen to have such supporting data in your back pocket, would you Alex? I sure hope you're right, though.
Just pulled a mls list or recently sold properties within 3 miles from center of Irvine of 3+2 sold listings and so far I've gone thru first 42 listings and 38 of them have sold under list price of 627 listings. I could be wrong but you're market is no different. Correction is coming. Check the data if you'd like because this is not my opinion just my observation.
I'm sure there is, I've seen it but not every property in SoCal is affected by outside international money. I'm involved in several LA pockets/markets and hardly ever see Chinese buyer offers or deals. Sure there are plenty of them buying in OC/LA and surrounding areas but not enough to say they make a huge difference in where our market is going.
@Diane G. do you have data to support your stance that Bay Area market is cooling? I've certainly heard about rents declining in SF and the crazy multiple offers not happening as much, but in most of the desirable areas I'm looking at in the East Bay things are still pretty hot. Would be very interested to see any info you got. Thanks.
I'm seeing multiple offers and properties going quickly on properties that are priced correctly. we recently offered 1MM all cash for a property listed at 900k. The house was not inhabitable and was a tear down. It sold for 1.1MM so 200k over listed price. 2 of my neighbors condos sold in 6 and 8 days multiple offers and over listed price. I think the houses that are sitting may be way overpriced and the appraisal doesn't come in.
If the property is priced well than you should expect multiple offers and for it to sell in any market. I'm not saying property in the SoCal market isn't selling or that it isn't selling fast. I see a lot that do sell fast, but still under list price. You present 3 examples of properties that went over list price, give me a zip code to check and I'll bet $100 dollars 80% of closed listings in that neighborhood also are closing at or under list price. What do you think? Are you feeling lucky? Lol
I have made the same observation with condos in 90025. Separate from price to list, I have actually seen list prices that are lower than 2016 and 2015.
I'm not seeing price declines here in Charleston SC. Here's statistics for our MLS to back that view up. For our entire MLS, sellers are getting 95%+ of their asking price... same as in 2015 and 2016.
I think there are some sellers that are putting things out there really high priced and those are only selling with a significant price drop or they sit on the market for a relatively long time. I'm actually seeing some price jumps it seems to me but I'm not sure if it's buyers wanting to get in ahead of interest rate rise or just the spring market heating up.
We have a lot of apts and housing in general being built and I'm expecting that to impact the rental market but what I've seen so far has been pretty high priced and I'm not having any trouble renting my properties out.
Around where i live in Sunnyvale, 1.5m price range, 44 listings, only 2 pending now.... That is unheard of.....If you look at SF marketing, above $1.1m, LOTS of listings NOT moving at all....
So I am saying in any "hot" markets, the entry level listings, which means diff $$ in diff markets , are still moving quick possibly with multiple offers.... Anything above that "entry level", not moving..... To me, that is the first step towards price decrease....
As far as Charleston goes, as I detailed above, I was referencing the best streets- the eastern side of SOB, French Quarter and Ansonborough mostly. For sales- there have been quite a few to sell at 10-15% below list this year in those areas. And I've noticed the shift in the market for rentals for this area and was notified of that by my management company as early as January of 2016.
Bringing in some charts that include the periphery of Upper King just below crosstown is comparing apples and oranges. Longitude Lane =/= America St.
@Account Closed Fair enough, you were talking about only the high end market. The original post wasn't though and while I might have seen a slight dip through the winter/holiday season, I'm seeing rising prices now. No telling where the future is going but except for the fact that we're generally back at the 2007 peak prices, I don't see a reason for a slowdown here in Charleston at least. (barring "black swan" type of events of course)
I'm not lucky enough to be handling any of the million+ $ homes right now but I do have a lead on a nice historic home in Ansonborough that I'm working on. Maybe I'll get to test out that market before long.
@John Semanchuk Best to you on the Ansonborough home! I have one in that neighborhood and have been very happy with it- high rents, easy tenants and great appreciation.
I would be perfectly happy to have my instincts on the market there proved wrong. Another couple years of strong appreciation would be great for the balance sheet. But at the same time, the rents for the top of the market properties are falling slightly and the Mueller model, which I use and trust, tells us that rental market softening is a leading indicator for a slowdown in the sales market.
There does appear to be an overall softening of the market for high end properties in status locations in the US. I see it in Charleston and Aspen. I have contacts whose opinions I trust report the same in the Hamptons. Is it just a blip and we'll be back to a strong growth market in a few months? Maybe. Maybe not.
Thanks @Account Closed! I would be listing that property, not buying it. It's an 1840's house with a lot of the original moldings and would make a great restoration project for someone who is into that and has the budget.
Congrats to you on having an Ansonborough house! That's a great neighborhood. Like you, I hope this is just a blip but price do have to come down or at least level off at some point.
I would think sales prices above list price indicates a frenzy or panic whereas below list means sellers price aggressively and concede a percent or two in negotiations. Everyone feels better that way (full price offers might indicate sellers leaving money on the table and buyers like to feel they got a bit of a markdown to compensate for a house not being exactly as they prefer). Of course in California 1-2% is quite a bit of money.
If the property is priced well than you should expect multiple offers and for it to sell in any market. I'm not saying property in the SoCal market isn't selling or that it isn't selling fast. I see a lot that do sell fast, but still under list price. You present 3 examples of properties that went over list price, give me a zip code to check and I'll bet $100 dollars 80% of closed listings in that neighborhood also are closing at or under list price. What do you think? Are you feeling lucky? Lol
Fair enough, I just pulled a random search of recently closing listings in those two zip codes. Of 346 listings, gone through the first 40 and 32 have sold at or under list price, most below list price. Not by a lot, but regardless my observation is still holding up. 80% or more properties actually selling in the SoCal market are not selling for more than list price. We're in a market correction and you'll be hearing and seeing more of that coming this year and next. Thanks.
I talk to potential sellers every single day. I look at real estate listings every single day. I have now seen most closed listings (80-90%) closing below list price for months now. I believe we're in the middle of a correction in the LA market which most sellers don't even feel it yet. However, I predict this will change soon. The rate hike will help reduce the buyer pool so sellers won't get multiple offers unless priced right. Many overpriced listings sitting everywhere. Millennials don't want the same type of properties/things other generations wanted. I can't see those suburb tract homes being bought by younger buyers. They want to live closer to things, Uber/Lyft has changed how we get around and commuting for hours isn't as attractive anymore. Many more people now work from home and don't need all that extra space those homes built the 80's, 90's and 00's. Families are definitely not as large so those communities will see greater decreases in prices compared to more dense neighborhoods which will continue to be in demand for this new generation of home buyers. These are just a couple of my observations on the LA market but I for one, am looking forward to the opportunities that will arise once we're back in a buyers market out here. Thanks.
Do you know any zips in LA where yoy value lost ground? From what I have checked everything was up 5% to 20% but I did not check 95% of LA.
Year over year value would be up. Someone who sold their house in 2016/2017 would have sold for higher than someone in 2015 however, closed sales data across many SoCal markets I've reviewed shows most current closed sales 80% are closing under or at list price, what do you interpret from that ?
I can not interpret much yet other than some might be listing above market. Do you know any zips yoy where foreclosures are rising or residential/commercial vacancy is rising? There are more peeps in LA County than in 42 states. Is there a zip code in the red yoy?
As someone said above just because property's are selling for below list price doesn't indicate a cooling off period. The sellers are probably just getting a better idea of what property will actually sell for and over stepping that amount. Its the value that real estate is selling for that is important for determining economic trends. List price, selling price, above or below is all just the psychology of the market and can change vary quickly.