Saturday, July 08, 2006

Price Reductions in Marin County as of July 8, 2006

Currently, 37.4% of all houses* on the market in Marin County are advertising "price reduced" according to ZipRealty.com. Keep in mind that these houses have not yet sold.

I didn't think we would break out of the 35% range. How long do you think until we reach 40%? 50%?

Below is a graph showing the proportion of the price reductions by percent range (e.g., the proportion showing a 1-2% price reduction, the proportion showing a 3-5% price reduction, etc.) for the same group of houses represented in the previous graph:

In the above graph it can be seen that the majority of Marin SFR sellers have reduced their asking prices by about 5%. Clearly, Marin sellers are still in denial (or maybe pre-anger phase, refer to this) and are pricing based on last year's market.

You know, it took me a lot of time to do this analysis. I should not have had to do this at all. Given all the money that people pay to realtors in commissions for whatever it is they do for us, realtors should be providing less attitude and spin and more of this sort of information IMHO.

*By "all houses" I mean that I searched ZipRealty for all SFR houses of any size and any number of bathrooms and bedrooms, etc. within the asking price range of $100,000 to $10,000,000, inclusive.

5 Comments:

Blogger sf jack said...

marinite -

Once again, thanks for all your work on tables, charts and graphs. They really tell the story.

Should you repeat the second one again in the next year, it will be interesting to see if the number of higher percentage reductions increases, thereby "shifting" longer bars to the right.

Will new sellers become more realistic than existing ones when they list, or will they continue to begin their listings at unrealistically high prices, perhaps in order to give the illusion that a serious reduction has already occurred? Just a thought...

Also, after the recent 0.58 reading of the Marin Market HEAT Index(tm) (your post of 7/4/06), perhaps we should start calling it the "COLD Index".

Jul 8, 2006, 7:53:00 PM  
Blogger mountainwatcher said...

I wonder what the realtors are telling the sellers in this market.

What is the strategy for dealing with this elephant?
Price way too high and then reduce a bit so they think they are getting a good deal?

My experience in a recent conversation with a realtor was kind of sad.

He told me that there is no bubble, things are just leveling off and will zoom up again soon.
Now is the best time to buy!

I really distain the greed factor.

Jul 9, 2006, 12:56:00 AM  
Blogger 49erFans said...

Great Blog, wonderful charts.

Jul 9, 2006, 1:37:00 PM  
Blogger marin_explorer said...

"realtors should be providing less attitude and spin and more of this sort of information"

When the market was screaming upward, sellers could dismiss realtors' costs, because they were getting theirs too. But let’s say the market flattens* long term. Who wouldn't question the "value" of handing 6% to the realtor--especially if that's out-of-pocket?

Right--how about realtors providing some real value for those five-, even six-figure commissions? We’re sick of the spin too; there’s very few local realtors we actually trust. Realtors can’t act like glorified grifters (seriously) and justify that kind of money.

The fact this blog and others provide better info than any realtors suggests big changes are due (and coming). It's only a matter of time before someone seizes the opportunity and provides a more cost-effective realty transaction model.

*because Marin can't get worse than that, right?

Jul 9, 2006, 8:13:00 PM  
Blogger Marinite said...

marin_explorer, all -

How about if every buyer who ever looked at this blog pay me just 0.5% commission? That seems fair as you get more tangible info here than there.

Ok, maybe not. The data should be free.

The fact this blog and others provide better info than any realtors suggests big changes are due (and coming).

Realtors are the reason why this and similar blogs exist, at least to a large extent.

It's only a matter of time before someone seizes the opportunity and provides a more cost-effective realty transaction model.

I'm placing my bets on Goggle MLS. Hey Google...listen up! And since I just gave you the idea, you own me big time. All I ask is that you put 1% of your profit into a fund that pays out housing assistance for Californians.

Jul 9, 2006, 10:21:00 PM  

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