Marin February, 2006 Results - Part I

Well, it looks like Marin buyers are maybe, just maybe starting to wise up. Yes folks, you buyers have the power to dictate this market if you choose. You have had this power all the time. Now it's time to flex your muscles. YOU have the money so YOU have the control. It's about time things were in your favor. Now is the time to screw all of those greedy sellers who for the last few years have been screwing you. Go re-read the previous post on this blog. Get angry, get worked up, and demand that 15% price reduction and stick it to the sellers. Do you really want to pay for the lifestyles that they (the sellers) couldn't afford in the first place? It's pay-back time.

Here is what West Bay RE has to say about February, 2006 results in Marin. But basically, in summary, the only things selling are the extremely nice houses or the houses that are so marked down in price that buyers cannot resist; pretty much everything else is not selling. The double-digit price appreciations are history. We are now in a long, long overdue buyer's market. And the best part is that it is only going to get better (for buyers, that is).

West Bay RE seems to have just changed their data format, now making it impossible to do year-over-year comparisons (unless that data is now hidden somewhere else on their site). Fortunately for us I still have their data and I will post the graphs later as they will put things into proper perspective. But for now, here is what West Bay RE has to say about February, 2006:

Do you remember your first junior high school dance? The girls stood on one side of the gym, the boys on the other. The teachers cajoled the boys into asking a girl to dance. A few boys made the move, and soon there were a few boys and girls dancing in the middle of the basketball court. That's what the real estate market is like in Marin County right now. The only difference is you have to pay for this dance.

Sellers are on one side with their houses all prettied up waiting for buyers to come make an offer. Buyers are on the other side looking, looking, looking. Buyers are now bringing magnifying glasses with them so they see every detail of the home. No longer are buyers rushing in to dance. They are sizing up the playing field and then choosing. If they don’t get the first dance they just wait for another.

This behavior is perfectly normal when the market turns from sellers to buyers: sellers can't believe the double-digit gains of yesteryear are over, while buyers can afford to stand pat. In fact, the only property selling right now falls into three categories:

1. very high-end property; Over $2,000,000
2. excellent properties that are priced right at, or even a tad below, the market; and,
3. the homes of people who have to sell now.

The market is in transition The transition is causing confusion. That's perfectly understandable. . Even most of the real estate agents who do this for a living are not sure where the market will be going. They are waiting to see what the buyers are going to do. Sellers' have been enjoying themselves for the past few years and, as we transition to a more balanced market, they will have to adjust their expectations. Buyers', on the hand, are sitting on the sidelines waiting to see if this transition is the beginning of the big "bubble", we don't think so [of course you don't think so; it's not in your commission-based self-interest -- Marinite].

Prices have come down about 8-9% from their peaks reached last summer. During 2005 Marin County saw an average price increase in ingle family homes of 16%. But, as we've mentioned repeatedly, like every month at the end of this report, the real estate market is very hard to generalize. It is a market made up of many micro markets, both geographically and in price range. Just because the median price for homes has fallen doesn't mean that well-priced, fabulous home on the corner will go for 8-9% less than the selling price. That house will still go for close to asking price with, possibly, multiple offers [yes, as long as that asking price is reasonable -- Marinite].

The median price for single-family homes in Marin County rose 6.4% to $926,000 in February from the month before, a year-over-year gain of 2.3%. Home sales fell 19.1% from the month before, and were off 14.7% year-over-year.

This is neither a "buyer's market" nor a "seller's market". At this stage in the game it is a fool's market. Now we find out who the biggest fools are.