A Year-End Snapshot of the Berkeley, CA Real Estate Market

by arlene on December 29, 2010

You’ve all seen the headlines:  Plunging Prices, Stagnant Sales, Foreclosures lurking. The Berkeley area market has remained stronger than most during this market correction. But during the past month most of the extended Berkeley area has seen very limited sales, increases in distressed properties, and significant decreases in prices.

I ended 2010 with my record intact: every home I’ve listed has had multiple offers and every listing has sold! With so many listings languishing on the market for months, or never selling, I am justly proud of my record. I was sure that my latest bungalow listing in the Fruitvale neighborhood of Oakland would break it, but it received three offers, and closed the last day of the year above list. Is it luck? Well, it seems the harder I work the luckier my clients become!

Current Active Listings in our Area:

This New Year’s Eve there were 106 properties on the market in Berkeley, of which 76 were single family homes (of which 34 are either short sales or foreclosures: 45%!) Average days on the market is more than  two months.  And a median price of just below $500K is 20% below last year’s at this time.

Albany has a mere six single family homes on the market (four having sold in the past week), one a foreclosure, one a short sale, and they’ve been on the market an average of three+ months.

In Rockridge right now there are only nine single family home listings active, one a short sale, one a foreclosure.  Seven of the nine are in Upper Rockridge. They’ve been on the market on average more than three months. 

Here’s my summary of what’s been happening lately on the buying side:

I am still writing two or more offers before getting into contract for most buyers, but this fall I was fortunate to get two sets of buyers into contract without competition on lovely homes in great neighborhoods–clearly a sign of a changed market. But at the same time a buyer had to compete against three other offers to purchase an especially nice condo on the Rockridge border. And new buyers had to learn the hard way that there are still pockets of strength in the desirable neighborhoods, where the best houses are getting multiple offers.

  • Even the gorgeous interest rates weren’t enough to motivate buyers unless there was some factor in their lives compelling them to buy now. Job uncertainties are trumping low interest rates
  • Historically, rising interest rates tend to trigger activity among buyers. That didn’t happen this time, perhaps partly because it hit in December
  • Buyers are counting on prices dropping further, and are waiting for that to happen, even in areas where we seem to have already hit bottom and are starting to see prices inch up
  • Most buyers assume it’s their market, and want homes to be priced as bargains
  • Cash is not always king in this area. In strong hold-out neighborhoods, like Thousand Oaks or Northbrae where multiple offers are still occurring, price may win over all-cash offers

Next week I’ll give you my very personal view of the listing side of things. But for now, I wish you all a Happy New Year celebration, and good things to come in 2011!

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