According to the statistics, Monterey County is in a raging buyers' market. In reality, not quite! Although there is a lot of interest and pent-up demand and buyers making offers, sellers aren't budging much from their asking prices. Consequently, few deals are being struck, and, of those that are, a very high percentage are falling out of escrow. Title companies on the Peninsula are guesstimating that 30-50% are falling through.
With that in mind, please take these numbers with a grain of salt. These numbers reflect general trends and have little bearing on any particular home in any given neighborhood. For example; in markets like Salinas, there is quite a bit of negotiating and pricing movement. However, Salinas is a much different market from the peninsula cities such as; Carmel, Pacific Grove, Monterey and the others. The Monterey Peninsula's real estate market has been picking up steam again. When speaking for the county though, it truly depends on the area which as we know falls back once again on; location, location, location.
The median price for single-family, re-sale homes in Monterey County fell 1.1% from January. Year-over-year, the median price is down 6.1% from the record high set last February of $700,000.
Home sales were up 6.4% from January, off 20.8% year-over-year. Sales for the first two months of the year were the lowest since we've been keeping records: January 1997.
The inventory of single-family homes in Monterey County gained 4.1% from January, up 16.2% compared to last February.
On the bright side, unless you are a condo owner or a renter, the city of Monterey amended their general plan to encourage the conversion of existing apartments into condos. Currently, there are six or seven conversion projects in the planning process which will result in approximately 500-600 units coming to market within the next 24 months.
The sales price to list price ratio for homes bounced back from its anomalous number of last month: 95.2%.
The up-tick in sales pushed our Days of Inventory indicator down ten days to 467 days.
My advice? For buyers, well-priced homes in the best school districts are selling quickly with multiple offers. Sellers aren't budging much on their asking price. Keep making offers.
For sellers, encourage offers and work with them. Yes, you're going to get low-balled. But, if you do manage to get into escrow, don't blow it there or your buyers will walk.
Ok, now that I've got your attention let's take a look at this a little more closely.
The average home price rose 24.8% in January, 11.5% higher than the previous record set just one year ago. Playing a major role in setting this new record were individual home sales of $11 million, $8 million and a couple over $4 million on 125 total sales for January. All in all, that took the average just over a million to $1,119,986!
Let’s break this down to a more realistic assessment of our current state of the market for Monterey County:
The median price for homes in Monterey County fell 0.2%, down 3.1% year-over-year. Home sales fell 24.7% from the month before and were off 12% year-over-year. The inventory of single-family homes in Monterey County turned around, gaining 6.1% from December, up 16.5% compared to last January. The sales price to list price ratio for homes fell 3.8 points to 90.7%, the lowest it has ever been.
That is definitely an anomaly caused by the huge difference between the asking price and the selling price of the multi-million dollar home sales. Consistently for approximately the last year or so, we've seen them within approximately 3% of one another (more specifically on the Monterey Peninsula side - Pacific Grove, Carmel, Pebble Beach, Monterey, Carmel Valley and a few additional outlining cities) and when you drop in the multi-million dollar home sales, it's only normal to expect a greater deficiency in Sales Price to List Price ratios. The drop in sales and the rise in inventory pushed our Days of Inventory indicator up 139 days to 477 days.
HERE IS JANUARY'S FIGURES FOR PACIFIC GROVE ALONE:
PRICES MEDIAN VS. AVG. UNIT SALES NEWLY LISTED $874,800 $850,000 5 16
TOTAL LISTED DOM SALES VS. LIST PRICE 68 94 97.4%
CHANGE FROM LAST YEARCHANGE FROM LAST MONTH MEDIAN AVG. SALES LISTED MEDIAN AVG. SALES LISTED -22.7% -22.1% -28.1% 15.3% 9% -8% -44.4% 11.5%
There some strong signs of life occurring out there right now. What I mean is that we're seeing a buyer surge once again. They're showing up to the homes they're most interested in, qualified and ready to deal. For this past year, buyers were afraid because they thought that the peninsula was going to take a heavy hit in pricing. Naturally homes still sold but, it was a considerable drop in sales activity until recently, as buyers feel more comfortable about investing on the peninsula. As I mentioned, sales are down but actual median home price remains stable. The most recognizable difference you'll see out there is the starting list price of a home. It is now much more accurate and in tuned with the market we're currently experiencing. Prices ARE NOT based off last year’s activity! Occasionally, we'll run across seller's who believe they can get last years inflated pricing currently for their home. As a Realtor, one of our responsibilities is to provide enough evidence and proof to seller’s that the market is quite different and if they plan to sell, they must price their home accordingly. After reviewing the statistics and inventory with them, most quickly realize that they need to come back down to earth if they really want to see their home sell. It’s a partnership, a team approach and a good Realtor needs to drive that home early and often so the client can feel comfortable and assured that their Realtor of choice is truly looking after their best interests. To me, there’s absolutely no other way of approaching it. You want to instill trust and confidence from day one, and you should never go against that. It will lead to a positive experience overall and hopefully referrals from your clients friends, family and colleagues.
A good Realtor could mean several things to different people. Determine what's most important to you and share your thoughts and ideas. Have an open discussion and get a good feel for how they work and how they'll work for you! If they recommend selling your home at a price that's potentially a little too high than what the market will bear then don’t be afraid to ask them how they came to that conclusion. Does it automatically mean that you the seller will have to wait longer to sell the house? Most likely yes, but not always. Does it mean that you'll go through at least one significant price reduction? Possibly so, if you haven’t seen any activity within the first two weeks. This market is a tough one, pricing is crucial and you need to partner with a Realtor who will be in agreement with you and not be afraid to disagree with you and back it up with facts and figures. Also, when considering a Realtor to sell your home don't just take into account their years of experience. Often times, that doesn't mean a whole lot, especially with the way the Internet has changed things. Different Realtors have the ability to bring a variety of skill sets to the table (i.e. are they tech savvy?) Do they know how to get the greatest exposure for your home via the Internet and traditional marketing and networking? Remember, when you hire a Realtor, you are forming a team. Find someone you get along with, see eye to eye with and someone who will shoot it to you straight without beating around the bushes. Try to get an understanding of their passion for what they do. Do they love the marketing side of the business? If so, that's great because you'll have a savvy marketing person working on your behalf. Passion will lead to creative thinking to showcase your home and provide useful information about it to help the sale move along swiftly while attempting to find a perfect suitor for the home.
A quick bit about mortgage rates; they have been creeping up since the beginning of the year but still remain quite low overall. Serious buyers are taking advantage of this.
Sellers, you've got a lot of competition right now so again, make sure to price your home wisely! Inventory is very high and has been at record setting levels since the middle of last year. Ask yourself why someone would buy your home rather than another's? Break away from the idea of, because it's your's and you love it so you know it's special. That's not rational and yet so many people think that way. It's difficult at times not to, I understand, but you need to if you're serious about selling. Put yourself in the buyer's shoes and compare the numbers of your competition. Look at price per square foot costs and if you're higher than the average, can you justify it? Your Realtor will do this and you should share these thoughts with your him or her if they don't. Share the pros and cons of the home with each other, it builds trust and will also help your Realtor highlight the areas you enjoy most about the home when they're speaking to a potential buyer. A tip: When you show your home to your Realtor for the first time, walk them through it like you're showing it to a potential buyer. This is great from a Realtor's perspective and they can use some of that information when they show it to buyer's.
In summary, just try to use plain old common sense folks and you'll do fine. Until next time..
As a young boy, growing up in Pacific Grove was a wonderful experience. Dubbed by many as, "America's Last Hometown", Pacific Grove is a beautiful, quaint community nestled on the Pacific Ocean on the Monterey Peninsula. Pacific Grove sits between Monterey and Pebble Beach; Carmel by the Sea is just over the hill or a fairly straight shot through Pebble Beach. This map will give you a great visual: Pacific Grove, CA.
I was raised by my grandparents and for many years we lived right on the corner of Grove Acre and Sinex. One of the best parts about it was that the bus stopped right outside my house literally on the corner of Grove Acre and Sinex, so getting to and from school was never more difficult than walking about 30 steps across the front lawn to the corner. This is the same corner I would try out my entrepreneurial skills each weekend, setting up a stand of good ol' fresh squeezed, powdered lemonade! I believe it might have even been Kool-Aid, but back then I don't think I really knew the difference and fresh squeezed sounded much better!
I didn't get in trouble much as a kid because it's pretty hard to be up to much around here. I had many friends, from "the neighborhood" to the schoolyard. Often times you would find us playing basketball down at Caledonia Park, to riding our bikes through downtown for a pit stop at the ice-cream shop or hanging out at night, just because it felt like the cool thing to do! We were really anything but. J The main thing is that there was never a time when we didn't feel safe throughout any neighborhood in PG. We just never had to think about it. In many ways, Pacific Grove felt like a giant playground, because wherever you were, there was always something to do. The recreation department is a great way for kids to get involved in something they enjoy. Whether it's Cub Scouts or sports, you'll find something you like all year round. Visit the Pacific Grove Recreation Department for more info.
The hottest months of the year aren't what you would expect. Even though there are plenty of beautiful days from May through August, you'll find our best weather in September, October and parts of November, which we refer to as our Indian summer. Those are the months when you'll see tons of locals down at Asilomar and Lover's Point beaches, taking in the sun, playing volleyball and cruising along the recreation trail, which begins in Pacific Grove and runs out way past Marina, a city about 15 miles north of PG on highway 1. Our water is cold here, so swimming without a wetsuit is not something you'll see too many locals doing. Tourists though...well usually they're just happy to see the ocean you never know what to expect watching them. One word of caution about the ocean is that you really need to watch out for the high surf when climbing on the rocks. It's life-threatening at times and you absolutely need to pay attention and not get close to the edge. Better advice is to simply not climb on them during high tide.
For parents; even though I am not one yet (hopefully soon), Pacific Grove is a fantastic place to raise a family. I feel very fortunate that I was able to move back here after college and work in an industry that I thoroughly enjoy. I met my wife, Julia, while we were both working for First American Title. She was a Business Development Rep. out of Santa Cruz and I was the same, based out of our Monterey office. We were married on May 1, 2004 and were fortunate enough to have purchased our own home here in Pacific Grove, where we are looking forward to raising our own children.
To receive my monthly real estate newsletter for Monterey County, feel free to visit my website. It's a great resource that includes current pricing trends, unit sales and advice for buyers and sellers. Best of all, it's broken down by individual cities. Enjoy!
My name is Chris Segovia and I'm a fourth generation resident of the Monterey Peninsula and a Realtor with Keller Williams Realty in Carmel. I've been licensed since 2002.
I would like to begin by providing a brief segment about my family history. Following that, I've added a few paragraphs about our current real estate market; mainly pricing trend info, unit sales and my buyer and seller recommendations.
Let me begin with my great-grandmother, Rose, alive and well at the wonderful age of 98! She's an incredible lady and the glue that bonds our family together. She's been an inspiration to me and a true friend to so many generations of Monterey residents. She's still sharp as a tack and has never lost her feisty entrepreneurial spirit. If I could only learn half of what she's already probably forgotten I would feel incredibly fortunate. Problem is, she doesn't forget anything and can tell you what kind of car her daughter's boyfriend was driving in May of 1953! She's commonly referred to as Mama Rose not only by family but also by our local patrons and friends. Many locals that may come across this blog will know exactly what I'm talking about and the familiarity of the family name, Segovia.
Rose and my late great-grandfather Al, opened up a friendly, bustling tavern back in 1937, originally named, "Al's Place." In 1964, their son, my grandfather, Larry, who is really more like a father than a grandfather to me, moved the location of the tavern across the street and renamed it, "Segovia's." Similar to "Cheers", it's a place where everyone truly does know your name! I could go on about the history of my family; stories about Mama Rose working down in the sardine canneries (what is now known as Cannery Row) prior to opening the bar, or, speaking of "Cannery Row," John Steinbeck being a regular at the bar and much, much more. However, I can't use all my material on the first blog!
I've lived on the peninsula just about my entire life (except my college years) and love it here. It's also a good thing that I ended up back here in Pacific Grove (my hometown) because in doing so, I met my beautiful wife, Julia, of Aptos, CA, who's also in the industry as a Mortgage Loan Consultant with Stone Castle Land and Home Financial in Carmel. You can view her website here, http://JuliaSegovia.com.
My goal with this first blog is to touch on our local real estate economy and begin to build relationships with people along the way. Whether you're just curious about the peninsula or if you're planning to purchase or sell in Carmel, Pacific Grove, Monterey, Carmel Valley, Pebble Beach or other surrounding areas in the future, I hope to be a valuable source of real estate information for you. Each month, I send out a real estate report for Monterey County. You can sign up for it on my website http://SegoviaRealEstate.com, called The Real Estate Report. Below, is an exerpt from my December newsletter.
MONTEREY COUNTY:
PRICES UP - SALES DOWN:
The median price for homes in Monterey County gained 0.8% in November, down 3.6% year-over-year. The average price rose 6.4, down 3.6% compared to last year. Home sales fell 4% from the month before and were off 26.4% year-overyear. Condo prices rebounded sharply with the median price rising 31.6% to $525,000, just $5,000 short of the record set last July. The average price did set a new record, rising 48.9% to $718,771. Sales were down 6.7% compared to October, down 46.2% year-over-year. With less than 50 sales in most months, these numbers fluctuate wildly.
The inventory of single-family homes in Monterey County continued to fall, dropping 6.9% last month, up 26.2% compared to last November. The sales price to list price ratio for homes fell 0.8 of a point to 94.5%. The ratio for condos dropped 1.2 points to 96.5%. Our Days of Inventory indicator dropped 12 days to 383 days.
My advice? For buyers, the market looks to be tightening up. Inventory is now at its lowest level since March. Prices look pretty stable. I wouldn't expect any sharp falls in price. If you are looking to buy, this may not be a bad time to do it, especially with mortgage rates at their low for the year. For sellers, sales are at the second lowest level since 1998. There is activity, but the franticness of the past few years has been washed out of the system. If you really want to sell your home, you need to entice offers and then negotiate them. Remember, in a market like this, your first offer is very often going to be your best offer. Work it.
The real estate market is very hard to generalize. It is a market made up of many micro markets. For complete information on a particular neighborhood, call me or email me. If you have any questions, I encourage them and will do my very best to answer them as quickly as possible. I look forward to speaking with you!
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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