As I write this, we are in the thick of summer which, historically, is a slow selling season with folks out on vacation and taking a break from house hunting. Unlike the spring market that is enhanced by morning dew, birds chirping, and fresh air igniting a feeling of exuberance, summer can be hot and uninspiring to search for one's new home. Generally, spring is the best season to sell in East Bay real estate with fall being the second best time to sell. Then the pandemic changed things up quite a bit! For the last two years our regular seasonality was not very pronounced because many people were timid about traveling due to COVID. This year is different. I am seeing many people I know are out of town via social media, traffic is noticeably thinner, and it seems people might be back to taking traditional summer vacations. There is a decline in open house and private-showing traffic, but how much of that is due to historical seasonality and how much is a result of the shifting economy with its rise in interest rates and change in consumer confidence? Whatever the case may be, I do know that there are still buyers who want to find a place to call a home of their own.
Although buyer activity has been falling, new listings continue to hit the market, creating an imbalance between supply and demand. As a result, key metrics in the East Bay are faltering, driving down median price as well as the amount buyers are willing to pay over the list price, while driving up days on market. For example, looking at active listings by the length of time they have been on the market, 42% of properties have been active for 5 weeks or more; at this time a year ago, only 27% reached this threshold.
However, not all properties are being affected in the same way. Higher-priced properties are generally performing better than lower-priced properties. Those that are "most attractive" – desirable neighborhood, appealing design and "move-in ready" – are often still generating a high level of interest from buyers. Indeed, when looking at properties that sold in Q2 2022, the higher the sale price, the further over asking the property tended to sell.
Buyers, if you are considering a purchase, now may be a good opportunity to buy. Right now there are 309 homes in Oakland that have been on the market for 30 days or longer, and in Berkeley there are 32 properties that have been active for 30+ days. With many people out of town and taking a break from the market, now may be an opportunity to get into a property that you love.
I am looking towards the fall market and I know that buyers will still be buying and sellers will still be selling. But nothing happens unless you can bring the two parties together! Please know as the seasons change, I will be carefully watching and tracking the market so you have market updates in real time.
As always I welcome your questions!
