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 YEAR                                                CHANGE 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..

All the best,

Chris Segovia
Keller Williams Realty
Carmel, CA 93950
http://SegoviaRealEstate.com
831.682.2138

Also, don't forget to visit Julia's site when seeking mortgage information at: http://JuliaSegovia.com.