Last year was a good year. Many of you had the best year since 2006.
So how is this year turning out? For many, it is a disappointment. Not as good as expected. We expected to sell more homes because we finally had an inventory of homes to sell. But that equation did not work. We have more inventory in part because more people are listing their homes, and we have more homes in part because we are not selling as many listings as we did last year.
The forecast expected the number of sales to increase 3% and prices to increase 6%. Let’s see how we are doing.
Conejo Valley is down 13% in number of sales, Simi/Moorpark is down 20%.
Conejo Valley median prices are up 11%, Simi/Moorpark is up 7%.
But the year is not yet over. Prices increase percentages will moderate, as prices have not increased steadily throughout last year. Sales appear to be doing better, but still need a shot of adrenalin to come close to last year.
We can say that for both areas, prices have been flat for the past 12 months. The big jump took place in the first three months of 2013. Comparing the first four months of 2013 to 2014 has been like a step rather than a ramp, they jumped up. (However, after that, they have been stable.)
Your sellers might read recent news on price increases and think their home should sell for 11% higher than the recent sale. If the comp sale was in the first four months of 2013, that would be a correct assumption. But prices have been consistent from April of last year, and if the recent comps are from the past 6-9 months, the listing and sales price should be about the same as those sales.
What has the inventory been doing? Growing steadily.
Both valleys now have inventories that are now higher than 2012, and much higher than 2013. 66% higher in the Conejo valley, and a whopping 152% in Simi/Moorpark. That is not bad news, the inventory is not outlandishly high, and represents about three months worth of sales. That, for our area, is a balanced market, favoring neither buyer nor seller.
But remember, all real estate is local. Chris McClintock had over 100 people at her open house on Sunday, and the home immediately went into escrow. The sweet spot seems to be the average price, between $600,000 and $750,000. That is where the most action, and lowest inventory, seems to be. These graphs show what things used to be. They do not show what the future will be. It appears the future is heating up.
Closed escrows in Conejo are strong and consistent week to week. Closed escrows in Simi/Moorpark average out well, but still are inconsistent week to week. The graph above displays these inconsistencies as white spaces between the bars. Interesting, but not significant.
What is significant is how your business is doing. What should you do to get your share, and increase your share.
We all would like a year that is better than last year. But the reality is, this year is different, different from last year, different from what we expected. And it is not over. I think it will continue to get better. Everything points in that direction. But we did not get the start that we were expecting. If we continue to compare it to last year, it may not turn out to be a good comparison. But last year was great. I think this year will be good.