Real Estate Pricing Conundrum…
April 25th, 2011 categories: General RE Info, Market Update, Tips For Buyers, Tips for Sellers
How Much is a Property Really Worth?
Is it the most buyers are willing to pay?
Is It the least sellers are willing to get for the property?
Is what and appraiser thinks it is worth?
Fortunately we have this dilemma since the market has been moving very fast. In the Single Family Homes Market in Weston for all price ranges we have been very close to 6 months of inventory which is the threshold between a Sellers Market and a Balanced Market*; if we look at the same market of properties priced under $ 400,000.00 the trend for the last year has leaned over being a sellers market with an average of 4.68 months in the last 15 months.
Now what is the problem then???
The sellers have high expectations based on the fact that they get many showings and in most cases competing offers.
The buyers can be divided in two groups: the ones that look in detail at closed sales and their offers are not competitive and those very aggressive willing to offer way above comparable sales expecting the appraisal to take care of the “real” value of the property.
Now we have the appraiser who if we are lucky know the area and pick reasonable comps and those who value regular sales taking more than 50% of comparable properties to be short sales (deducting 10% off the listing price if they are pending) an foreclosures when the market’s trend is a price to sell ratio of 95% and distressed sales only represent 30% of the closed sales. The appraisals tend to be below the negotiated purchase price and in most cases the sellers are willing to reduce the price to reflect the appraised value and in fewer cases the buyers are willing to bring extra cash and pay above appraised value.
The spread of prices is unbelievable in both active listings and closed sales. It’s hard to determine an exact price and we look at best and worst case scenarios to determine how to price either when we have a listing (making sure it is competitive based on whatever else is in the market) or when we suggest a price to use when presenting offers. Sellers and Buyers have the last word!
We don’t want the market to look like the earlier 2000’s where people overpaid just to be able to grab a property, but in a market where supply is short and demand is high the gaps will always exist and the most aggressive buyers end.
Have you experienced problems being able to secure a property to purchase?
What would be your advice to someone who has presented several offers and has always been outbid by other buyers?
*Months of Inventory based in Closed Sales
Less than 6 months=Sellers Market
Between 6 and 9 months=Balanced Market
More than 9 months=Buyer’s Market
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If you are interested in buying or selling, please call me at (954) 588-7260 or contact me.
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Weston Real Estate Single Family Homes Sold September 2009
September 30th, 2009 categories: Market Update, Tips For Buyers, Tips for Sellers
33.3% of Single Family Homes Closed Cash
As of Sept. 30th 2009 these are the number of closed sales and active listings reported in the MLS. Some additional sales might be updated in the next few days.
As we can see even though only 3% of the active listings are Foreclosures the market look eagerly for them, they last in average less than 1 month in the market. Sometimes only days receiving multiple offers.
The number of cash transactions is amazing! A total of 17 transactions closed CASH. A few properties closed above listed price.
Based on Closed Sales we have 7.23 Months of Inventory (Balanced Market)
Single Family Homes
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How Weston Real Estate Market Compares? 2nd Quarter 2009
July 21st, 2009 categories: General RE Info, Market Update, Tips For Buyers, Tips for Sellers
Months of Inventory June 09-Weston Florida
There are no set rules to determine how a real estate market will perform in the future, the industry uses Months of Inventory based on Closed Sales (total inventory divided by the number of houses sold per month) as a guideline. Months of Inventory based on Closes sales is a much powerful indicator that the traditional “Days on the Market” used to measure the length of time a property may remain on the market.
Seller’s Market or Buyer’s Market?
Months of Inventory also let’s us track if the market is balanced, leaning toward sellers or buyers, in a concrete way. If the market keeps on that trend of activity it calculates the number of months it would take for the market to deplete the currently active inventory. It is generally agreed that areas with 6 to 9 months of inventory are considered to have a normal or balanced market. Areas with more than 9 months of Inventory are referred to as buyer’s markets, while areas with less than 6 months of inventory are considered to be a seller’s market.
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