You’ve likely seen headlines and heard chatter about a housing market shift. It is confusing. You may wonder, is now a good time to buy, or should I wait to see how much prices might come down? Will my stock portfolio regain its value faster than rates will rise? Should I just rent? All valid questions. While there is no crystal ball, Davidson Group has access to detailed market data and lots of first hand experience with buyer/seller behavior at the ready to help you understand the landscape so that you can make informed decisions. 

Buyers: Fewer in Number, More Focused, More Choosy

Fewer buyers in the market means fewer offers. Until the shift, a hot home could see 10-12 offers. Today, that same home might see 2-4 offers. Bidding wars aren’t as frequent and some great homes are sitting on the market! An increasing inventory of homes and a smaller buyer pool makes it easier to get the home you desire than it has been for several years. While there are still many well qualified buyers out there with large cash down contributions, more typical buyers with 20% down or even less are getting into contract on homes that just several months ago would have been more challenging to compete for. Buyers are starting to get choosier about what they offer on. Many are feeling less rushed and more concentrated on finding the perfect home, despite increasing interest rates. Bottom line: Now’s the time to get in the game to be a bigger fish than was possible 6 months ago!

SF/Oakland Condos: Let’s Make a Deal

Despite a positive bump in the condo market as we emerged from Covid, condos in both markets are now starting to stay on the market longer than anticipated, resulting in some price drops to re-stimulate buyer activity. Depending on location, unit and building amenities, and relatively attractive HOA fees, certain condos are still enjoying competitive offer days and resulting high sale prices. Other condos may not have the same billing, and thus less competition, and they’re ready for action! We’re directing our buyers to units that have been sitting on the market for longer than a few weeks. With motivated sellers and a smaller buyer pool, many are eager to collaborate with our buyers. We’re also helping our clients identify Compass Private Exclusive listings that haven’t gone to market yet in hopes of finding a seller who’s willing to sell off market. Many condos in the Bay Area—especially Victorian and Edwardian flats in SF—live like single family homes, and they’re great alternatives to their single-family counterparts. Bottom line: Now’s the time to add condos to your investment home portfolio and your single family home search. 

Single Family Homes: Is Transparency Trending?

For the last few years, the favorite pricing strategy for desirable single-family homes in the SF/Oakland market has been to price under market value to capture the attention of buyers on their phone apps, generate multiple offers, and stoke price competition on offer day. It’s been a winning formula, especially for homes that offer what many homebuyers have sought in the Covid era: 3+ bedrooms, space to work from home, usable and comfortable outdoor space, good parking, and ample storage. The common 20-30% delta between list and sale price—which we’ve seen balloon to 100% in some extraordinary sales around the Bay Area—has cooled a bit. In single family homes we’re seeing about a 5% dip in that difference. We’re seeing buyers engage more with the value of the actual property at hand rather than with the raw competition; they’re looking to spend their dollars on the actual house and not just the chance to obtain one. Imagine that! As a result, listing agents are starting to coach their sellers to price accordingly, which is why you’re seeing some new listings come on the market at prices that are just a wee bit closer to where the seller wants to end up. Listing agents are telling us that their sellers have “realistic expectations”, that our clients “should just write an offer”, and that their clients are “really ready to sell.” Bottom line: Now’s the time to enter the single family housing market if you have a solid cash purse, can weather the higher interest rates, and want to spend your money more on the actual house than the process to win it!

Why Choose Davidson Group at COMPASS?

Our team has a knack for making sure our clients are armed with market data, prepared to write smart offers, well-advocated for, and ready to get to their closing date with us guiding them every step of the way. Let our clients tell you about their experience working with us; check out our testimonials.