Low Inventory - An Even Bigger Opportunity for Sellers at This Time of Year
I’ve just had an opportunity to study the latest area real estate statistics (for September) for both San Mateo and Santa Clara counties.
They once again reinforce that we are still in a strong seller’s market at the moment, but one particular statistic stood out for both areas.
I immediately noticed that both counties were seeing higher numbers of listings in September than in the previous month – up by 3.7% in Santa Clara and by a very notable 25.9% in San Mateo.
These are very interesting in that they suggest confidence among more sellers that we’re going to have another excellent fall market.
They are also another sign that there has been a bit of a shift from the traditionally busiest months of the year to a more even spread.
However, in terms of inventory of available homes for sale, that’s where the good news ended in these stats.
Taking a wider year-on-year perspective, we can see that inventory continues to fall overall, down by 23.1% from September 2016 in San Mateo and by even more in Santa Clara – 46.3%!
So while the more recent month-on-month trending provides some cause for optimism, it’s clear that buyers are faced with the issue of simply having less choice across most sectors in these two markets.
It’s no surprise, therefore that September saw year-on-year rises in the average sold price vs. original list price – up by 4% to 103% in San Mateo and even better in Santa Clara with a rise of 5.1% to 104%.
The implications of the sold price vs. listed price really are massive. They mean that, on average, sellers in both counties are realizing more than their asking price! It rarely, if ever, gets to be better than that.
Of course, if we look at how inventory is underperforming then we at least partially answer the question as to why this is happening.
Buyers are nonetheless still incredibly enthusiastic about purchasing a home, being well aware that current low mortgage rates cannot continue indefinitely and therefore not focusing on less choice in a very negative way.
That said, what we cannot accurately quantify is how many more sales we’d be seeing if buyers could tick all their boxes more easily. However this doesn’t change the reality that sellers have a fantastic opportunity right now.
And the even better news is that fall sellers are very likely to benefit from even less inventory as the holidays approach.
As recently as last week’s blog, I wrote about why this time of year is so great for listing your home. Unfortunately, while every real estate professional tries to instill this mindset among clients, the reality is always that some sellers will temporarily withdraw from the market, especially when the holidays are more clearly in sight.
This therefore makes a great situation even better. Buyers at this time of year almost invariably have an immediate need to purchase, so less choice is arguably not so off putting and, therefore, your asking price will be more robust while there’s even less competition around in the coming weeks. The chances of receiving multiple offers are therefore also enhanced.
There are some really strong signs that we’re going to have another tremendous run-in to the end of the year, so please contact us today to informally discuss how we can help you to take full advantage of the situation.