Bidding wars are back, I repeat bidding wars are back. The Silicon Valley has been 2 years ahead of the rest of the country as far as a real estate recovery and now the beginning of an upward trending curve is upon us. I've been predicting from the end of 2009 that the market was picking up, watched increased buying activity in 2010, even more buying activity in 2011 and now the bidding wars are in full swing in 2012. Literally in the last month, I watched week by week as areas that have been slow in the last few years, suddenly have a slew of Sale Pending homes. Areas that I've been calling opportunities disappeared in just a few weeks. Inventory is extremely low and there are 5 to 20 buyers bidding per home in the Bay Area! Homes are spending less than a week on the market before they are sold against multiple offers.
There are four factors driving this demand: low and downward trending interest rates, stalled home purchase plans during the recession (both factors have been constant throughout the downturn), the latest are increasing rents hitting renters right at their pockets and some IPO money giving Buyers the down payments they didn't have before. Another intangible is just unavoidable human behavior; when everyone else is buying individuals decide to join the crowds.
Real Time Competitive Examples
- Just last week my clients competed with 6 offers on a Mountain View Townhome, other offers went at least $70,000 over list price, no contingencies to beat us out
- 4-plex in San Jose had 19 offers, $70,000 over list price was not enough to win this property, there was no appraisal contingency
- Sunnyvale Ponderosa Park Single Family Home, 11 offers we went over list price by $91,000 to win, no contingencies
- Sunnyvale Ponderosa Park Single Family Home, 15 offers, someone offered $100,000 over list price to win it, no contingencies
- Mountain View Eichler had 15 offers, winning offer was $111,000 over list, no contingencies
- Palo Alto homes I have heard $300,000 over list price, no contingencies as well as all cash offers are abundant
- San Ramon - Lost against 5 offers, even San Ramon is showing signs of life!
- Fremont - Lost against 7 other offers and people were going over the comparables price!
- Some new home builders are doing lotteries, but most are taking advantage of the market and moving to the bidding system as well
If you are a Buyer, talk to me to really understand what it takes to get a property in this market. It will take a major adjustment in your mindset, expectations and strategy.
The rest of the country is also showing life in multiple markets as existing home sales are on the rise, prices are increasing and distressed sales reducing. The National Association of Realtors at last is able to declare that "a recovery is underway." An excellent detailed news article and video on this subject http://www.realtor.org/news-releases/2012/05/april-existing-home-sales-up-prices-rise-again.
If you are a Seller and have been thinking about selling your home, contact me for a Competitive Market Analysis. Depending on the location of your home, when you bought it and for what price, I will advise you if it is a good time to sell your property. At a high level it's a Seller's market, I would suggest that you take advantage of it depending on your next move.
Buyer's if you haven't met with me lately, be sure to grab time to discuss how to win in this market. This market requires aggressive behavior and deep pockets to cover the appraisal differences if needed. This may or not be the right market for you, we should definitely define the strategies that give you the best chance of attaining your next home.
Still Available Tri-Plex in Palo Alto
103 Tennyson in Palo Alto is still available. We've had 5 offers on the property but haven't quite worked out the right combination of price and terms. Let me know if you or someone you know have any interest in the profitable investment property.
Details online here at: http://alanwangrealty.com/PropertyDetails?fl_hook=1588819476&show_description=yes&show_address=yes&presented_by=&show_virtual_tour=yes
Exclusive New Home Developments
I have information on 3 upcoming new home developments, 2 coming soon in June and another in September. Remember, always go in with me on the first visit for new home constructions or they won't let me represent you or work with you thereafter. I also have great relationships with most of these builders which will make getting you the best deal easier and smoother.
Recent Home Sales Activity
- 1021 Iris Avenue in Sunnyvale - Beat out 10 other offers to win this property
- 572 Minor Avenue in San Jose - 4-Plex in San Jose, 19 offers, first offer backed out and we were in the backup position! Good spot to be in, no buyer's remorse =)
- New Home Development, South Bay - Clients purchased Model Home with over $100,000 in upgrades
- 103 Tennyson in Palo Alto - Tri-plex in Old Palo Alto with over 5 offers, unable to agree on terms or price
- Won 3 bids lost 8 bids thus far this year, madness!
Details Located at: http://alanwangrealty.com/MyListings
Again I thank you all for your trust and referrals throughout the years. I hope you and your family had a wonderful Memorial Day and here's to a wild 2012 in the Real Estate market!