We're officially into our summer market, but just because inventory has diminished, it doesn't necessarily follow that interest has . . . or that prices will. . .
Still, July and August can be great months to step in and purchase a home while others are away on vacation or distracted with swim lessons, tennis camps, family outings or travel abroad. In truth, fewer Buyers at the table should equate into less pressure on the final sales price, so personally, I've always been a fan of the summer opportunities, even while appreciating the need to get away and relax.
By the way, it's not just some Buyers that have strayed, but many of their Agents as well, as they too, seek time away from the unyielding hustle and bustle the Spring Market invariably brings. (Not that I'm complaining, mind you - productivity equals private college tuition.)
But who can blame the public for tuning out and taking some much needed "down time" once summer beckons? (Not me.) As everyone quickly learns, buying or selling a home can quickly move into a full-time job AND a heavy Internet addiction, especially here in the Bay Area. For many who've faced rejection a time OR two, OR three, OR FOUR . . . August often provides a bit of a breather and a welcome respite. (You're not alone.) Go ahead and enjoy some time off - you've undoubtedly earned it.
As for me? I'll be heading to Tahoe this week for a little R&R and hoping there's still some water left in the lake. (Please tell me there is.) I'll still be writing offers and reading disclosures, but I'll be doing it in shorts and flip-flops and that's at least something.
Speaking of which, according to a good friend and fellow agent, prices in Tahoe have plummeted a whopping 53% on the heels of a four-year drought and an absence of snow! (Aren't you grateful you bought here?) Ouch! That can certainly sting if you're selling a lakeside home right now. If you're not, don't lose a moment's sleep. The value of any home is ONLY ever relevant come time to sell.
Unfortunately, for some in the Tahoe region, that time is now.
"We took a bath on our cabin in Northstar," Caroline shared (too bad, I liked that house a lot and I'm sorry to see it go.) "So Uncle Sam received NO capital gains from us . . . we sure showed him a thing or two," she laughed. (Caroline has a great sense of humor and a positive point of view.)
As she should. Not only is Caroline extremely gifted at her craft, she's spent the majority of her adult life selling real estate in and around San Francisco, and has experienced the variables first hand. As such, she's watched the market go up and down and has navigated both ends of the spectrum with a steady hand and uncompromising integrity. As good timing would have it, she's seen more UP markets, than down, so she's come out far ahead on the deal, and she'd be the first to tell you so.
But here's the basic premise that harkens back to economics 101: ("Beuller? Beuller? Beuller?") markets aren't static instruments - they have a propensity to move!!! When and how much, is how fortunes are won and lost, I suppose, but over TIME, home values have climbed and home ownership (aside from being a lovely place to hang one's hat) has generally been well rewarded. According to the California Association of Realtors CAR), one in four Americans (27%) believe that Real Estate is the single best investment, far outpacing the stock market (17%) for the first time in many years.
Even so, none of us wants to pay TOP DOLLAR for our homes.
"Has the market peaked?" (It's unclear.)
"So how much is this house going to sell for?" (That remains to be seen.)
"How much will I need to offer?" (How much do you really want the home?)
"Will we be overpaying for the house in this market? (That depends on how long you plan to hold the property.)
"I don't suppose you'll know what other parties are offering?" (No, I won't.)
"Will we know what the other offers were after the fact? ("No, you will not - nor would you want to.)
And so the questions continue . . .
(Gee, I wish I had more definitive answers for you.)
The truth is, that regardless of the number of years one has writing offers and putting homes into escrow, the process in a Sellers' Market is largely a blind auction. The list price merely sets the starting point in a multiple bidding situation and while not every house is procuring multiple offers, the vast majority of them are. Where exactly a home will ultimately trade, is largely an educated guess and a clear understanding (on your part) of how much you want the home OR how willing you are to walk away (or not!).
Oh, that's not much fun. (No, it isn't.) I understand your frustration and to add to the confusion, the market won't always stay this way.
But here's another truth - the price you pay in today's world is largely irrelevant in tomorrow's . . . (as long as you plan to hold the house for 10 years or more).
By way of example, yesterday I met a darling, elderly couple in front of their home, who had bought their house at a probate auction 40 years ago for $90,000; a bargain by today's standards - and then some . . .
"I was furious with her," the husband confided to me. "I wanted to back out of the deal; it was soooo much money for us at the time. Good thing she didn't listen to me," he said with a wink and a nod, pointing at his better half. His wife simply smiled.
That's the ending we're all hoping for. No, not the part where we don't listen to our husbands, but where we made a wise decision!
Now go hit the beach (there's plenty of it).
How can I help you?
Julie Gardner, has been writing The Perspective for 18 years and has published more than 670 essays on life and real estate.