The conversation that occurs most frequently in my daily travels goes something like this:
“How’s the real estate market?”
“Really?” (Raised eyebrow)
Yes, really. People have become conditioned to expect my answer to be something entirely different, conditioned by the media, and conditioned by the neighbors. The real estate market in Scripps Ranch has in fact changed, as it has on a national level. Different, however, does not necessarily mean good or bad, it just means “not the same”.
Memories fade with time. Here are some numbers for detached home listings and sales in Scripps Ranch, courtesy of the Sandicor MLS:
April 29, 2004:
Active listings = 10, Average market time = 18 days
Sold homes (previous 30 days) = 15, Average market time = 23 days
May 10, 2004:
Active listings = 28, Average market time = 13 days
Sold homes (previous 30 days) = 27, Average market time = 15 days
Active listings = 95, Average market time = 50 days
Sold homes (previous 30 days) = 28, Average market time = 45 days
To a buyer in 2004, the market was anything but “great”, yet we tend to reflect back on these times with longing. I have spoken with too many people this year who admit that they, regrettably, employed the shotgun approach to purchasing their home. The house was anything but perfect, they say, and they paid too much, they say, but it was a house, and they “won”. These were the good ol’ days when the sign installer had to wear a Flak Jacket and protective head gear to avoid permanent injury when the inevitable stampede of hungry buyers arrived. I suspect some buyers resorted to following the sign truck around hoping to head him off at the door with their over-full price offer at the first sign of brake lights.
To a seller, these were the good ol’ days – Except, once the dust settled, the crowd cleared and the multiple-offer “high” wore off, most sellers became buyers, which wasn’t so much fun as it was pay back. Assuming that the majority of sellers are also buyers (a valid assumption), all things are relative, and I suggest that our current market is relatively more sane. Buy high/sell high or buy low/sell low, take longer to sell/have longer to contemplate and negotiate a purchase, half-full or half-empty; it’s really a matter of perspective.
Today, we have just short of 100 active listings in 92131, this out of approximately 8,000 real, permitted, inhabited single-family detached homes. Statistically speaking, few will argue that this represents a glut of housing inventory. Market times are holding steady at fewer than two months on average. Unless your history book only goes back five years, this can certainly not be construed as an inordinately long time.
I hear it almost daily, and I even have to check myself on occassion lest I lose perspective. “My home has been on the market for 12 days, and I have no offers. What’s wrong?”, or, “My listing was shown 8 times over the weekend, and we received no offers. What’s wrong?”
“What’s wrong” may be price, it may be condition or location, or it just may be that our expectations of instant gratification are unrealistic in a “normal” market. Our buyer pool has diminished, this much is certain. Over-leveraging, unaffordability and move-up needs having been satisfied during the crazy days are all contributing factors. Yet, I remember the wacky good ol’ days of the mid-nineties when I couldn’t give my own house away. In 1994, if you had two showings a week and sale within the initial six-month listing term, you were rocking the house. Sell it then for more than you paid in the late ’80’s, and you were assured bragging rights and the undying envy of all at the neighborhood block parties for the next decade.
Unfortunately, we see many people who are victims of timing. To those who purchased within the past two years and must move now, the real estate market doesn’t seem so swell. To those who purchased during our last down-market and have enjoyed the successes of timing, it could go either way. If the increased equity is now sitting in the driveway in the form of new luxury cars or has otherwise and for whatever reason been cashed out, the market seems pretty crummy. To others who let it ride, life is good, if at least on paper. For the most part, the wealth generated for many was an unexpected gift, yet one which too many have come to expect – over and over again.
So, yesterday is gone, and today is here. What is normal today? If your home attracts a half-dozen to a dozen showings a week, you are having a good week. If your home sells in one to two months, you are in good company on the bell curve. And, by the way, while we continue to be reminded minute by minute, by the media and by the neighbors, that our market has been undergoing a correction, prices are still at or near all-time highs in our region. Prices have retreated (by approximately 6 to 10%, depending on the statistics used), yet home values approximately doubled in Scripps Ranch over the four to five year period prior.
The Scripps Ranch real estate market is just great, thank you, and just different.