A Buyer’s Market?

One thing about Real Estate…it sure is cyclical. One month (or week!) it’s up…and the next it’s down. Even in the hottest market’s there’s this cyclical factor. The lulls may be less but they exist. Who know’s what the cause is today? Maybe it’s just the long 4th of July holiday, maybe it’s bad stock market news, maybe it’s the overall negative press the economy has gotten lately…heck maybe it’s the Giants losing streak or the oil spill! The fact is that it’s slowed down in Foster City.

Interestingly, there’s only been 2 single family houses sell so far in July. One of them a deeply discounted short sale and the other a listing that entered the market as a pending sale…they already had their buyer and just entered the listing for statistical purposes. As for condos/townhouses, only 4 of them have sold in July and all of those reflect aggressively deep discounts on their asking prices.

From a buyer’s standpoint, in my opinion, this is the time to buy. Rates are low and competition is clearly less. I’d venture to guess that 90% of the sellers in Foster City right now would understand their need to negotiate downward on their price. I’ve never been exactly sure why this phenomenon occurs with buyers but it has long been my opinion that buyers frequently throw away their natural leverage when they get the opportunity to have some. Buyer’s tend to engage the market at the same time and retreat from it at the same time. It’s long seemed to me that buyers would much rather compete in a multiple offer scenario than write an offer without competition. They would rather write an offer $100,000 over asking than one $50,000 under asking. The fact 0f other interested parties on any given listing makes buyers feel more comfortable buying.

It’s all alot like the stock market, smart investors buy when other’s are not and take advantage of opportunites for discounts when they present themselves. Now is that time in Foster City. There’s 25 active single family homes on the market and 30 condo/townhouses. Some of them are ripe and ready to be picked too.

Comments

  1. Larrisa says:

    It’s the “people are sheep syndrome”- lining up nose to tail- nose to tail.

    I’m picking up deals that won’t be there later!!

  2. It’s definitely a great time to buy real estate, regardless of where you are. And unfortunately, I don’t think things are going to turn any time soon. With a huge ‘shadow’ inventory which will push prices downward when it hits the market and unemployment rates not improving, the possibility of a double dip is becoming more of a reality.

  3. Interesting indeed. Though the comment on the buyers mentality makes some sense, but how come all of the sudden that the buyers stopped bidding altogether? There must be something else. Maybe buyers, while sitting on the fence, start to feel that the air traffic is just too noisy and frequent to bear 🙂

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