For those of us active in the real estate market in Berkeley, CA, and the adjoining communities, 2009 was frustrating. I kept telling myself it was primarily because of low inventory. With not enough properties to show our clients we had buyers who were disappointed not to be able to find the home they wanted here. Others found their desired home, only to have it elude them as one of the several other offers received was the winning bid. In a surprising number of cases in Berkeley in 2009, the winning offers were all cash (see my post below from Dec. 2009).
Some took their disappointment to other East Bay cities where they were able to find distressed properties at attractive prices. But for those who want to live in this community because of the rich architectural heritage, the physical beauty, the active "life of the mind" and the tremendous variety of ethnic restaurants and ingredients -- few places will compare. University towns are special that way! Palo Alto has some similar attributes, but with a substantially higher median price. For many of my buyers, only Berkeley, or the adjoining communities of Albany and Kensington, or adjoining neighborhoods such as Rockridge in Oakland, will do.
You can scroll down to read an earlier blog post about what I think are the reasons for the lower inventory. Whatever the reasons, the fact is that our inventory was down in Berkeley anywhere from 13 to 21% from 2008, depending on the quarter, and that had been similarly down from 2007. Statistically that doesn't sound enormous, but the absolute numbers were quite small. Through 2008 the average number of single family properties on the market per month was 164; all property types averaged 199 per month. That same numbers for 2009 were 141 and 169, down 14.5% and 15% respectively. For sold properties the figures are 38 through 2008, and 36 through 2009, a remarkably small difference, on an equally small sample size. Total residential properties sold in 2008 was 461; in 2009 it was 434, a decrease of just under 6%. I must say that as one of the fewer than 600 members of the Berkeley Association of REALTORS(R) it is rather daunting to realize that at least in single family homes, there were a grand total of 868 sides of transactions for the year. Divided by the number of BAR members (584 at last count) that means on average each association member did 1.5 deals in 2009, and it only goes to 1.6 deals considering all residential sales! If you consider all property types, then each agent did an average of two deals for the year.
The chart below shows median list price and median sold price. You can see it varies by month, but median sold prices exceeded list prices from February 2008 through February 2009, and then again in October the sold prices again began to exceed list. It takes a great deal of overbids for the median sales price to exceed the median lists price! But while at the end of 2008 we were looking at median sales prices in the low to mid-$700K range, as the end of 2009 approached we saw median prices at $700K in November take a full $100K hit in the two subsequent months. For the month of December, the median sold price was $595K. More significantly, the year-to-date median was $658.6K, almost a $100K drop from the previous year's rolling median. Obviously we are all anxious to see what the new year will bring!