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"I've been told that there are opportunities this time of year but I can't seem to find a home in the area that we like." We're hearing this more and more from buyers these days.

On the surface, this seems to be inconsistent with the fact that a whopping 64% of the homes for sale in the San Francisco East Bay are sitting for more than 30 days. However, if we ask the question why, maybe we can better understand what's going on.

Traditionally our markets are seasonal. Buyers and sellers tend to step away at this time of the year. Many sellers remove their listings temporarily or delay putting them on the market until after the new year. Usually that means late February or early March, whenever the sun comes out, and long past the holidays or even after the Super Bowl. So in realty, it isn't that more homes are actually sitting, it's just that new ones aren't coming onto the market.

Buyers tend to focus elsewhere as they prepare for family gatherings, travel, holiday events, and children on winter break from schools, etc. With so very little "fresh" home listings available, the few buyers that are looking during the holidays are still seeing competition.

However, for the most part, many buyers have not been willing to take a 2nd look at those homes that are "stale," ones that they may have already dismissed, but ones that did not get the initial offers expected. That's where the real opportunity lies. We've been conditioned to think based on the "hot" market we experienced earlier in the year that the list price was only a starting price and that with multiple offers they would eventually sell for well over asking. If you dismissed a home because you felt it would be out of your price range, then maybe now is the time to take another look.

There's always that stigma that goes along with those houses that don't go into contract right away. "If nobody wants it, why would I want it." Sellers who were expecting a sale over their asking price may have to come to the realization that maybe they were just priced too high and/or the house wasn't made ready to market properly.

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Here are some highlights for the 38 East Bay Cities that I track:

• Inventory dropped impressively during the month with a 25% reduction in homes available for sale. Typically many sellers wait to list their homes until after the holiday season while others temporarily withdraw their listings to do the same.

   

• With the number of pendings, (homes that are in contract), remaining relatively the same as last month's numbers, this drop in inventory helped to raise the pending active ratio to 1.4. This supply and demand ratio typically signals whether we're in a sellers or buyers market. Typically, a number well above 1, (more inventory with less pending) favors sellers. A number below 1 favors buyers.

   

• The actual number of homes "sitting" hasn't changed much. However, with less new homes coming onto the market the per centage of homes sitting becomes more of a factor.  64% of homes listed now remain active for 30 days or longer, while 36% stay on the market for 60 days or longer. We're also seeing an increase in the number of price reductions.

   

• The "distressed" market, (foreclosures and short sales) are no longer much of a factor representing only 4% of sales over the past 4 months.

   

• Median Price recovery on a city by city basis is stronger. 7 out of the 38 East Bay cities tracked are now at or above their median price "peak" levels with another 16 cities within 10%.