Thank you for returning to the Monday Market Update here on the Bobbi Decker Real Estate Blog! If you know me well, then you know I am committed to sharing education and information based in fact, which may not necessarily be the same as what everyone wants or hopes to hear. I would not be doing my job as a real estate agent if I set the same expectations in today’s market that I did 12, 18, 24 or 36 months ago. While there are still many opportunities to buy and sell Silicon Valley real estate (and many micro market trends that create outliers of the median sales prices and days on market today), we are in a much different market today than we were at many points over the last 1-3 years.
We are no doubt amidst a period of more recent market normalization that is actually a very good thing! Can you imagine what would have happened if home price appreciation had continued at its previous pace? With price acceleration slowing across the majority of greater metro areas, there are some misconceptions about what that means here in Silicon Valley. The main way I am seeing that play out in the current market is overpricing. It typically happens in one of two ways, either agent-driven (to get the sale via a method that is an over-promise but under-deliver), or client-driven (“but my neighbor’s home sold for XYZ last spring”!).
To help everyone get on the same page about where the market is today, I propose that each homeowner works through a ‘Real Estate Reality Check’ via these 6 questions:
#1: If I sell my home today, my #1 goal would be: _________________.
#2: What is the median home price in the area in which I am selling and the area in which I am buying? How much have these figures changed over the last 12-24 months?
#3: When trying to estimate the value of my home, am I utilizing resources which take into account my home’s current condition, relevant upgrades, location and number of like homes on the market? (Note: virtually all online search sites provide ‘guestimates’ based on public sales records – which may or may not be like homes/comps and definitely lack knowledge of any improvements!).
#4: Have I received a thorough explanation on how different pricing strategies may impact the number of offers I receive and the traction I get? (The days of underpricing to drive multiple offers are gone, while overpricing deters potential buyers all-together.)
#5: Am I prepared to accept a great ROI regardless of how many offers I get? (Not every home will get multiple offers and sell over-asking… but if your home is priced right – that won’t impact your bottom line!)
#6: Have I completed a cost of waiting exercise to determine what waiting to sell means for: the next home I buy, how much interest rates may change, and what my lifestyle needs are today and tomorrow?
As you consider your personal real estate goals, I encourage you to evaluate them in the context of today and not what could have been 2 years ago or what may be in 18 months. Ultimately, if you can get where you want and need to be, the rest is just noise!
All my best,
Bobbi Decker & Associates fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. For more information, please visit: http://portal.hud.gov/