It seems like every week I see some new sign of how distinctly different this market is from all others I’ve seen. Multiple offers are the rule now, but multiple offers on homes in terrible condition or in bad locations are happening as well. It’s simply amazing! Well, this week we have a true acid test. This property pictured above is an 1190 sq ft, 2 bedroom townhouse at 3317 Kimberly in San Mateo. It’s just across the water from the houses on Port Royal in FC. It’s a pretty cute unit really and it’s priced pretty well at $498,000. A waterfront 2 bedroom at Isle Cove at 827 Phoenix was listed at $599,000 and closed at $710,000 but it’s in Foster City and boasts FC schools. Still, $498,000 is pretty low for a waterfront anywhere.

The problem is, this place has a fairly unusual disclosure that in every single market place I’ve been a part of would harm it’s chances of selling. The disclosure here says the following:

“Previous owner (brother) died of natural causes in the property. The date of death was October 4 2012. The body was not discovered for 2-3 weeks. Remediation and restoration was done on the property beginning in October”

The listing agent also states this:

“As the owner mentions, the prior owner passed away in the home and was not discovered for 2-3 weeks. Per death certificate. Some neighbors thought it might have been longer”

Seriously, this kind of disclosure would have turned plenty of folks away from this house in markets past. I honestly thought this place would get multiples but I thought they wouldn’t be large in number. Turns out this place got 20 offers yesterday! TWENTY! So much for damaging disclosures! This market is truly amazing!! There’s no such thing as a problem that can’t be overcome I guess!

Well, the question really is how high will it go? There’s a house right now, listed by Karim Sarraf of Keller Williams, at 389 Tampa that’s on the market for $1,725,000. It’s a large 4 bedroom, 4 bath house on a large 7326 sq ft lot and the house itself is 3288 sq ft. There’s only been 4 other houses in Foster City history sell for that much or more and only one of those was not on the water. The 6 bedroom, 4 bath 3800 sq ft house on a 1/4 acre lot at 893 Sea Island hit the top spot at $1,975,000 in 2005. This house is sure intriguing and it’s going to be fun to see how it does and what the market thinks of it. If not now at this price then when? Good luck folks!

So I get a nice email from blog reader Patrick Chang who asks:

Seems like the insanity has cool off a bit as homes that came out last week are
scheduled to open again this weekend. Your take?

It would appear that the higher level of inventory creates the appearance that things have slowed down a tad. Let’s take a look at the current inventory to see if that’s true? Right now there’s 8 single family homes on the market. 2 of them, 1123 Farragut and 602 Bridgeport have been on for 42 and 391 days respectively. The Bridgeport house? Go figure! Farragut is simply overpriced even for this market (maybe?) After that we have 4 listings that have been on for 6 days or less. One actually just came up today. All 4 have offer dates set for next week. they’ve all given out disclosures to multiple parties (except the one that just came up). The other 2 have been on for 13 and 14 days. 619 Waterbury is a probate that won’t look at offers until April 9 and 543 Trinidad looked at offers on Tuesday but asked for 48 hours to process them. I’m assuming we’ll see a pending soon. For what it’s worth, the fixer at 998 Marlin got 10 offers on Tuesday.

Sort of the same story with condos and townhouses. Also 8 active listings. 4 at the Admiralty ($625 dues) and 1 at Promontory Point ($800 dues), after that 100 Bonita’s deal fell through and is back on market…offers next week, 57 E Court is a short sale and they have an offer date next week and finally 126 Beach Park just sold today with multiple offers.

I guess the answer to Patrick’s question is that it still seems pretty hot to me out there. With Spring Break this week I’ll bet we’re going to see some new listings next week. Should be interesting.

Here’s the good news…there’s more inventory out there. Actually a whopping 8 single family houses listed as of today. I spoke to the photographer in my office yesterday and he told me he’s been super busy shooting virtual tours. That means we’ll see more after Easter. Yay! What’s the bad news you ask? How about the prices on those new listings?

Let’s look at 239 Puffin. It’s a 3 bedroom, 2 bath house. 1890 sq ft. It’s listed for $985,000. The most money EVER spent for this floorplan…$1,015,000. Do you think Puffin will surpass that place, which by the way was at 245 Puffin? Last year 2 of this floorplan sold listed originally for $888,000 and $899,000 and closed at $951,000. 239 Puffin is the lowest priced house in Foster City today.

How about 340 Staysail. It’s a 1780 sq ft 4 bedroom, 2 bath house. It’s listed for $999,000. Looks pretty original in the pics. The most money EVER spent for this floorplan…$1,038,000. Think this one will top $1,038,000? I do. Last year 3 of this floorplan sold, the most for $930,000. It was completely remodeled. 2 others sold for $850,000 and $890,000.

Or how about 921 Swan. It’s a big 5 bedroom, 3 bath house, 2540 sq ft listed for $1,268,000. Last year it sold as a short sale for $985,000. It closed at the end of October. The most money ever spent for this floorplan? $1,270,000 in 2007. I’m thinking Swan will go beyond it.

I think this is an important thing to consider if you’re a buyer right now. There’s a common line of thinking that if you just wait the inventory will appear and everthing will even out again. The panic will end and go back to where it was last year…or earlier. I think the new inventory will indeed help…but prices are going up and by August at this rate there won’t be a single family house sell in Foster City under a million dollars. You may have less competition, but you’ll pay more then. It’s not even April 1 and prices have undoubtedly gone up at least 10% overrall. It’s amazing.

Now I wonder what I could get for this little house? So what if it’s a dog house…it would probably sell for $500,000 around here! So, I saw a friend of mine post on Facebook today that there were only 8 houses on the market in San Carlos today and it gave me pause. We all whine about how little inventory there is out there right now but I really wondered what it looks like from the ground. I think of these price ranges as being fairly typical of what buyers look for. If you’re qualified up to $625,000 you’re really not looking at houses listed for $925,000. Each range to me represents a certain subgroup in which buyers tend to be in…in my experience. Also, I topped it out at 1 million dollars just for fun. So I checked and here’s what I discovered.

In San Mateo, Belmont, Foster City, Redwood Shores and San Carlos there’s exactly 3 single family homes on the market for under $625,000. All of them in San Mateo actually.

In the range from $625,000 to $750,000 there’s 11 houses. 10 of them in San Mateo and 1 in Belmont.

In the range from $750,000 to $900,000 there’s 7 houses for sale. 5 in San Mateo and 2 in Belmont.

Finally, in the range between $900,000 and 1 million there are 8 houses for sale. 5 in San Mateo, one each in Belmont, Foster City and Redwood Shores.

So what do we have here. We have a big problem. Since 39 offers were made on that house on Hiller a few weeks ago we know there’s at least 38 buyers interested in houses under $625,000. Of course there’s WAY more than that but 39 parties had the courage to jump at Hiller. At least 38 parties are now looking at the 3 houses for sale in 5 different communities. It’s surreal isn’t it? Realistically there’s probably 100 parties looking at those 3 houses. Likewise, there were 27 offers on a house on Wooster in Belmont last week that was priced at $728,000. 26 of them are looking at the remaining houses and those are mostly the over $750,000 group…where there’s 7 listings in these 5 towns. It’s also worth mentioning that there isn’t anything on the market at all in San Carlos under $1,000,000.

Can you see the picture here? This is like the beanie baby or first I phone release. It’s phenomenal how many buyers are out there and how little inventory there is.

I swear, for almost all of 2012 I went on and on about how wacky and hot the market was. What the heck did I know! If you bought a home last year and went over the asking price to get it…you probably stole the place! So far the 2013 market makes last years look like 2009. If you’ve been playing in this ballpark you know exactly what I mean. If you haven’t…hold on to your hat. I showed a house on Williams in Belmont that debuted  at 1:00 PM on Saturday and looked at offers at 2:30 on Monday. In just a bit over 2 days they got 8 offers and the house went $150,000 over asking. I talked to an agent today who wrote an offer on a house on Chestnut in San Carlos who came in $100,000 over asking and finished 11th out of 13 offers! I spoke to another agent who wrote an offer $200,000 over asking on a house in Los Altos and missed it by $300,000! That’s right, the house went $500,000 over asking.

There’s no standard right now. No rules for this game. I have an 820 sq ft cinderblock house in San Carlos listed for $559,000 that I put on the market on Friday. So far I’ve handed out 11 disclosure packets on it. Offers are on the 19th. I’ve never seen anything like this…and I think I said that last year at this time! One of the scariest things is the number of ALL CASH offers right now. Seems like all the winning bids are cash. It’s amazing. I had an agent tell me she received an offer with 50% down and the buyers agent apologized because they had a loan. Like it’s a shameful thing to not have a cash offer. This is on a house listed for $1,500,000.

I wish I had an answer for this. Actually I wish I had more listings! Come to think of it…if you’ve been thinking about selling, now’s the time. My phone number and e-mail are at the top of the page. Seriously. It’s impossible to overstate how much inventory we need right now. We could triple the current level and it wouldn’t mean a thing. There’s that many buyers out there.

Honestly, when it comes to analyzing statistics on condos and townhouses it’s really a pain in the butt…and it’s value is sort of dubious in many areas. The only real way to access true analysis in this area is to look only at the individual project and see how it did over a period of time. In Foster City you have projects that have done very well and others that have completely tanked and judging the whole category becomes problematic in that light. The problem is that I don’t have time to break each project down and post on them…so I’m still going to give you the total market numbers for whatever that’s worth. If you want to know trends for individual projects just let me know and I’d be happy to get you that info.

Two areas that are illustrative are average days on the market and total number of units sold. First the DOM:

2006…240

2007…165

2008…112

2009…140

2010…143

2011…144

2012…156

Pretty amazing that 2006 had 240 sales vs 2008 with 112. Last year was definitely on the upswing and surely could have had more if more folks had decided to sell. The inventory was abismal…exemplified by the average days on the market. In 2006 it was 41, 2007 was 40, 2008 was 55, 2009 was 70, 2010 was 50, 2011 was 72 and 2012 was back to 41. It certainly would have been far less without the short sales at the Islands and the Admiralty. Now how about the gross average sales prices:

2006…$661,993

2007…$694,026

2008…$635,839

2009…$577,267

2010…$577,150

2011…$512,192

2012…$551,001

Like in single family, 2012 was the only year (including 2006) that the average sale price was above the average list price. Much of the overall price erosion here since 2006 can be attributed to values tanking at Promontory Point and the Islands. Unless we get a ton more inventory 2013 is going to be another growth year for prices in Foster City.

Well, it sure seemed to me to be a very hot year here in FC and the most of the rest of the Peninsula as well. So how do the numbers looks? I have to say that the MLS has upgraded it’s ability to provide comparable analysis and it became clear to me that some of the numbers I used in previous years doing this have been wrong….so I’m going back all the way to 2006 in each category here to show the full picture of how Foster City’s real estate business has been. Let’s start with total number of transactions. These are just single family homes:

2006…144

2007…117

2008…99

2009…110

2010…122

2011…124

2012…128

Clearly there’s been an uphill trajectory when it comes to number of homes sold here since the downturn. Now how about average days on the market?

In 2006 it was 37 days, 2007 was 31 days, 2008 was 48 days, 2009 was 65 days, 2010 was 43 days, 2011 was 55 days and finally last year came back to 34 days. Obviously the market was a bunch warmer here last year. Now how about the actual numbers…the average sales prices:

2006…$1,078,000

2007…$1,113,000

2008…$1,118,000

2009…$1,010,000

2010…$1,004,000

2011…$976,000

2012…$1,021,000

Another interesting fact about the 2012 market was that the average sale price was actually higher than the average list price…and that was the first time since 2007 that we saw that happen. The truth is, outside of the presence of the short sales in this town bringing the average down somewhat, we could easily had the highest average sales price ever last year. Who knows what 2013 will bring. If inventory doesn’t improve these prices are sure to go higher.