Piedmont Perspective, Vol 32 – The Year in Review!
What’s New?
Happy New Year! I’m back from vacation, having enjoyed a quick ski trip up in Canada(eh?) with my family and close friends and am ready to move into the New Year with renewed excitement and energy (and better powder technique!).
Would it help you make some decisions about buying or selling a home in the 2008 if I recap the real estate activity in Piedmont for the calendar year of 2007? (I thought so.)
However, a brief disclaimer first . . . I am culling these numbers directly from the Multiple Listing Service (MLS). As a result, private sales will not be calculated. In other words, these statistics aren’t perfect, nor do they show ALL of the sales activity in Piedmont, but they do represent a fairly accurate depiction of our local market last year, as published and reported by the MLS. Let’s proceed . . .
What Sold?
Per the MLS, Piedmont saw approximately 106 houses change hands between 2007 and 2008with an average sales price of $1,619,946. The highest home sale for the year was recorded at $7,600,000 – on Sea View Avenue (a grand estate on almost two acres) while the lowest home sale reported was $725,000 – on Greenbank Avenue.
One-hundred, plus transactions sound like a nice high number until you consider that it represents a very small percentage of home sales in our unique and wonderful community. With fewer than 4000 residences in Piedmont, this number amounts to less than 2.65 percent of properties that changed ownership in 2007! So count your blessings if you were one of the fortunate few who realized your goal of owning property in Piedmont and lucky you, if you had the good fortune of selling last year – you probably saw more than one offer. Congratulations!
How Did the Numbers Break Down?
Good question. Real estate, like many industries, has seasonal cycles. Our cycles are largely based on school dynamics, summer vacations, and holidays. Generally, you can expect the market to be the most active in spring when a summer close offers an easier transition, and the least active in winter when Thanksgiving and Christmas holidays dominate the landscape. It is important to note that most private schools require a commitment by February which often creates demand earlier than one might expect. As a consequence, Piedmont often attracts strong buyers in the very first quarter continuing straight through to summer.
Piedmont did spike, as expected last spring with 45 closings, but it also enjoyed a flurry of late activity in the final quarter with 23 transactions. The months of January, February, March were actually the least active with only 18 Piedmont sales posted to the MLS; however (and this is significant) the Median Price (half sold above, half sold below) during this same time period, was almost $300,000 higher, on average, than the Median Price in the 2nd quarter, suggesting that demand fuels value.
Why Was this Year Unique?
We all know the mortgage industry took a beating with sub prime lending practices that caught up to hard money lenders in late July. This fairly brief – but highly publicized – upset reverberated throughout the marketplace. Although everyone wasn’t a sub prime borrower, suddenly the lending institutions painted all borrowers with the same wide brush, making available mortgage products scarce in August and September. As these institutions regrouped and reset a higher bar, most well-qualified buyers waited out the aftershocks. Availability of reemerging loans and/or new product late in the fall season, resulted in strong 4th quarter activity. The GRUBB Co, in particular, enjoyed a very busy 2007. Here at GRUBB Co, we are fortunate to represent communities in Piedmont, Oakland and Berkeley that continue to enjoy strong desireability and demand!
What’s Happening Now?
That’s really up to you. Currently the MLS records only three Piedmont listings so now might be an ideal time to bring your home to market before competition increases later in the spring.
Ultimately, the decision to buy or sell in the first quarter is largely based upon your specific needs and goals. Have you already purchased a replacement home? Are you under a time line? What is your current risk tolerance for buying or selling at this time? (We know where rates are today, but won’t know where they will be three months down the road.) Has there been a change in the family dynamic? A new job? A new sibling? A retired adult? An aging parent? A change of scenery? A new adventure?
What’s Coming?
Whatever life holds, remember that I am here to advise and guide you. I am here to provide answers and options, and I look forward to working with you to meet your goals now and in the future. Here’s to an exciting 2008!