First, the numbers. This spreadsheet compares the number of active and sold properties in each zip code, compared to the same time last year, and the average list or sales price. For a PDF version, click here.
This is very confusing, right? Stay with me here — we are looking at real estate trends and in the light of all that’s gone wrong this year—Coronavirus, civil unrest, job losses, restaurants and bars closing (so you can see where my head’s at), life as we knew it—real estate should be devastated, right?
Well, it’’s not. Sure, there are fewer sales this year than last—after all, we have experienced an incredible loss of jobs and money. Lenders are nervous, people in general are nervous, but true buyers in a certain price range (and it’s generally not the highest range with exceptions) see their chance and are going for it!
We are representing buyers who are up against 10, 39, 40 offers! Some of our buyers have all cash! And they can lose to someone who has more. Once in awhile, we pull off unlikely deals —like we were actually quite a bit lower than the highest offer on one house but we got it because the buyers wrote a great letter and we represented them instead of the out of area unknown agent. The sellers cared about such things. Some do, some don’t. You never know.
If you compare the average sale price of 2020 and 2019, you see that they are higher this year over last year, in every zip code except South Pasadena. This is not the sign of a recession.
What conclusions can we make from all this? You might be thinking that to get the most for your money, you should save on the commission. Not true. You get what you pay for, just like a lawyer or a doctor.
1. Choose the best agent you can who is experienced and trustworthy (not the same thing as the cheapest or your cousin who just got into real estate) and do what they say!
2. If you’re a seller, price your house right, and prepare it correctly in line with your price.
3. If you’re a buyer, the choice of your buyer’s agent can make a difference as well—your cousin from Santa Clarita doesn’t really know this area or how things are done here, and the seller’s agent is more comfortable with someone she knows will get the job done. The possible savings on your cousin’s kicking back some of his commission is not worth what they don’t know and the fact they could be the reason you don’t get the deal. All this is nothing new, but because there are fewer sales than before, you really need to bring your best to the table.
Another conclusion we can come to is that this isn’t bargain-hunting time. And this is the time when sellers who are pricing their homes to sell are succeeding. Sellers who are wishing for a high price are sitting on the market getting stale. And buyers who actually want to buy a house, not “play the market,” can do so.