Our housing market — and the greater economy — remain in a period of adjustment, making buyers and sellers more cautious as they wait to see how the dust will settle. One key indicator of this adjustment is the percentage of homes selling below their list price, which you can track in the chart below.
Lately, we’ve seen a lot of buyers' fatigue and clients who wanted to give up. We’ve also been in multiple bid situations that went more than 40% above the listing price. Here’s how to stay competitive:
Position your financing like a cash offer – Offers with non-contingent financing are proving just as strong as all-cash, and down payments over 30% are very competitive.
Bring your best offer, not your best price – Stand out with a flexible or quick closing date, depending on the seller's preference.
Find a good communicator – Your agent's relationship with the listing agent could make all the difference in negotiating a mutually beneficial offer.
That’s all good, but what is it’s still not enough to get the job done?
Consider waving and/or minimizing contingencies – This can be a gamble, but it's growing more prevalent. That’s why it’s important to have an agent to guide you.
Put more skin in the game – Pay the initial 3% deposit within one day of your offer being accepted, buy a one-year home warranty, and more.
Know when to walk away – In the end, you may get out-bid, no matter how strong your offer or how well positioed. Sometimes the smartest move is moving on.
Want to learn more?
We hear a lot about “median sales price”, but what does that really mean? Well, the median is the middle number of a data set when you arrange it from high to low. That means the median sales price represents the price at which half the properties in an area sell higher and the other half lower.
Okay, so how is that different from the “average sales price”? The average sales price is calculated by adding up all the prices for home sales in a specific area within a specified time frame and dividing that total by the number of properties sold.
Median and average sales can be valuable sets of data for both buyers and sellers in helping them set their budgets. However, it’s important to remember that the average sale price may be skewed due to outliers in the data – i.e.properties sold at prices far higher or lower than typical for the area.
Some of the most expensive communities in the country are clustered on the border of Santa Clara and San Mateo Counties, in the heart of the Peninsula – though both counties contain other, very expensive markets. The charts below offer a look at the combined markets.
As you can see here, the combined median house sales price in Q3 2019 was down 5% from Q3 2018, but still 3% higher than Q3 2017.
A decline in competition for new listings is illustrated in the second chart, as the market turned from a high average overbidding percentage, to an average sales price below list price.
What does this mean for you? Send us an email. We’d be happy to walk you through it.
