Davis CA Real Estate 2010 Predictions...

Friends, I hope that this new year and this new decade is one of hope, peace, personal contentment, and a time when you are surprised and happy with what you make happen in your life! 

The question of the season is, so what is going to happen this year? First, let’s visit 2009 for a moment.  It was the year of the first time home buyer.  I helped buy/sell 46 properties and 31 of them were for people who had never owned a home before.  My favorite was a family who has been renting in Davis for 30 years, and decided that NOW is the time to own.  There was lots of nervousness around these sales, but ultimately the rates were excellent, the government incentives were a help and these new homeowners are excitedly begining to nest in their new homes.

What we did not see in 2009 were enough mid-range homes of good aesthetic quality.  And even fewer high end homes.  I believe that sellers in the mid-upper ranges have chosen to stay put and remodel rather than move up.    For buyers in this range, the prospects were generally dismal.

So, 2010?  If we were “returning to normal” before, we have definitely arrived now!  People are buying homes not simply as an investment, but as a place to live, to have a sense of neighborhood, to raise their children and to LIVE comfortably.  Sales take longer, buyers are more detail-oriented, processes are undertaken more deliberately.

Inventory will improve.  At present we have 81 properties on the market.  For a town with a population of about 65,000 this represents VERY few choices!  Many people who were waiting will make their move to sell this year.  We have a large population of people who own large homes (think Northstar) whose children have long since left home – I predict that this population will be ready to start right sizing, looking for something new that better suits their lifestyle. We will see these homes begin to come on the market.

There will be no “average” Days On Market. Homes that are attractive, well kept and accurately priced will sell within a week on the market, so buyers, be prepared to take action.  Homes in ill repair, unstaged and unready for market, and not priced correctly will linger for hundreds of days.  Buyers are no longer tolerant of paying top dollar for what they disparagingly refer to as ”dumps”.

Interest rates will go up.  The U.S. government will stop purchasing mortgage-backed securities from Fannie-Mae and Freddie-Mac by the end of March 2010 based on the lack of funds that have currently been allocated for the ongoing purchase of these mortgages. If true, this means that banks will once again need to step in and underwrite these loans (as opposed to the American public) and it’s fairly safe to assume that banks won’t be writing loans at 5% fixed interest for 30 years.

Foreclosures, in Davis? There will continue to be a handful of foreclosures in Davis, and there will be mid and high end homes in the mix.  There will be short sales and new rules for short sale processes mean that the sales time will be shorter and less mysterious.

People want to build their own homes.  This Instinct that is unscientifically based on anecdotal evidence from the many people I speak with.   They want something new, something with a modern aesthetic, something that fits their life, something that they aren’t finding in our most recent inventory. There are very few lots in Davis, this is the year that homes will go up on these lots….

Davis Homes: Six Months at a Glance...

This is a dynamic chart that updates in real time….like it?  Save it to your favorites and it will be up-to-date every time you look at it.

SOLD...

Here are a few homes that sold in the past month:

Listed $999k / Sold $961k

Listed $559k / Sold $560k

Listed $559k / Sold $535k

Listed $689k / Sold $681k

I think this means is it time to buy…...

This weekend at an open house a homebuyer from the Bay Area whom I haven’t seen in 18 months admonished me for no new entries in the Davis Real Estate Blog!  I stand before you sheepish and apologetic – no excuse, just too busy selling homes.

The spring market is up and running.  Here is  a snapshot of the market today:

We have 64 new listings, but 99 new pendings and solds – very short supply of homes, particularly for this time of the year.  Here is a breakdown of the year so far:

So, why a good time to buy?  Those sellers who have listed their homes have done so because they REALLY need to sell (the others are still waiting)!  AND the interest rates have almost never been lower.  Two weeks ago I had two clients secure loans (with 50% down and amazing over-800 credit scores) of 4.3% with a couple of points.

From listening to buyers, sellers, friends, disinterested parties, interested parties, – from all of them I gather that there is a lot of pent up desire – some want to sell their homes and downsize, some are looking for larger homes. They have stopped their search in the past 18 months due to market conditions.  My guess is that we are going to see people coming out of the woodwork in droves ready to buy, ready to sell.

Davis Real Estate : 2009 First Two Month...

When asked, I am not sure just which price will produce the sale, or when. I used to predict these things with remarkable accuracy. This year, not so much… This is what we do know about the first two months of this year:

Number of sales is only 55% of the past 3 year average.  Average home price is down 5% from 2007.  Price per sq ft is down 7%.  But also down is DAYS on the MARKET – homes are selling faster.  (The selling price/ list price ratio is holding at 96.5%, but be aware that this is a misleading number – the MLS only measures the difference between the LAST listed price and the sales price. I have corrected this glitch in chart of sold homes below.) The good news? We have 23 sales pending.  Average price is $493k, $280 sq ft and 105 days on the market.

With only 105 properties on the market no Davis homes should be languishing, yet some are. It seems to me that sellers are understandably having a hard time coming to grips with lower prices.  Many of our homes are priced as if it were 2006.  Being only 15 miles from the countries foreclosure capital, buyers from the bay area are looking for bargains.  Sorry, only 16 of these homes are short sales… If you are curious to know, here is what has sold so far in 2009:

More buyers are visiting my listings in the past two weeks and I *think* that we are about to start our spring market in earnest. -Jamie Madison

The Island of Davis...

Greetings friends – checking in to report to you what our market looks like so far in 2009.  We have a phone system at Coldwell Banker that agents phone in to when they have a new listing, offer or sale to report.  That phone systems has been mighty quiet lately. Slow to get started this year, the spring listings are beginning to trickle in (we currently have a 2.8 month supply of homes).  But the announcements of sales have not yet started. I took a look at January 2008 vs. 2009 to see what it looks like on paper. The truth is, January is just plain slow, no matter what the year!

2008                     2009
Davis Home Sales 10                           14         +40%
Days on Market                                 88                           81
Median Price                                   $525k                    $435k    -17%
Average Price                                  $549k                   $455k     -17%

Yolo County Home Sales                46                           58          +26%
Days on Market                               107                          68
Median Price                                   $322k                    $299k     -26%
Averagae Price                                $391k                    $273k     -30%

I am sure that it is obvious to you, but the increase in sales/decrease in time is a reflection of investor interest in short sales and foreclosures in Woodland, not Davis.

-Jamie Madison

Selling or Keeping: Your Home at Its Bes...

Every January the realtor trade rag from Realtor.Com publishes a great issue of home trends for the year. Since this seems to be a ubiquitous conversation among my buyers, sellers and friends, I thought you might like to hear the summary of what they have to say.

REHAB – Kitchens and Baths Matter Most!  4 Rehab “must-do’s”

1. Universal bath design – roll-in showers with grab bars that match other fixtures (can you say aging demographic?)

2. Kitchen island – not a boring square, but one that is furniture-like and filled with storage

3. Sealed shower – with multiple shower heads and an outside vent for moisture reduction

4. Stainless steel appliances – the only choice for ALL kitchens

The kitchen has become a living space, not just a work space.  Open it up to the extent that you can, and create a kitchen island.  Preferences:

Materials – light colors, white walls, shaker style cabinets, white soapstone or marble counters (or quartz  silestone in my book), or soft cream white stones with recycled copper accents.  Add glass panel doors to some cupboards.  Update hardware.  Paint the upper kitchen cabinets….(yes, that is what their designers suggest).  Stainless steel is still a must for appliances.

Accents – use small areas of strong, saturated colors and warm grays.  A little bit of shimmer – glass or metalic small tiles on the backsplash - will pop the colors.  Bright colors are popular for the laundry room.

Lighting -be excessive with natural and manmade lighting.  Add skylights, have light come from multiple walls AND from above.  Use LED lighting under countertops and around glass doors and cabinet shelving for inexpensive ambiance. Place inexpensive fixtures on top of cabinets that don’t reach the ceiling.  Put dimmer switches everywhere.

Storage – you can never have enough. If possible, add a pantry.  Turn kitchen islands into storage with built-in wine racks and appliance storage.  Add roll-out shelves. Garage and ample laundry room storage is a huge hit with buyers.

Earth-friendly – the move towards sustainable products is big now.  Try using eucalyptus wood that can be harvested in just 10 years.  Use recycled copper. Find water-saving features that allow you to preset water volume and temperature. (while in Davis visit Case Verde Designs for a really great introduction to green materials.)Custom is king – even if you are trying to spruce up your house on the cheap, add just a couple of luxury features – a kitchen island with the feel of fine furniture, a custom hutch in the bathroom, a panel to blend your refrigerator or dishwasher with the cupboards, for example. Or splurge on a wonderful light fixture over the island.

Five features that buyers want most:1. 36% want a separate enclosed shower in the master bath
2. 31% want an eat-in kitchen
3. 24% want high-end appliances
4. 23% want granite counter tops
5. 21% want a kitchen island.

Davis CA Number One Buyers Agent...

If this snapshot were better lit and closer up you would see how remarkably silver my hair is now!  Small price to pay for the honor of being the Number One Buyers Agent in Davis for all of 2008 (based on dollars sold.)  Awards were handed out today. This one is worth a frame.  It was a challenging year to find good homes in Davis.  Fortunately, I had the most amazing and wonderful clients – across the board!  Thank you very much for making me a stand out.

-Jamie Madison

Davis Home Sales – A Glance Back...

We all want to know what is going to happen in real estate this year. I don’t know either.  I am here to help buyers and sellers come to terms on their perception of value….and hopefully the banks will agree. ( Homes are starting to come back on the market and sellers are pricing them like it is 2006…. for example a 2300 sq ft Steng, pure vanilla and appears to be in good condition priced at $685,000. )

Consider the percentage of change in average price for single family homes in Davis: up 18% in 2005, up another 2 % in 2006, down 8% in 2007, and down 6.6% in 2008.  Overall home prices are still up 5.4% from 2004….

However total revenues from homes sold are considerably down however – almost 50% from 2004 – as the number of sales has dropped from 805 in 2004  to just 423 in 2008:

Looking back over quarterly average price fluctuations for the past three years we see the same shallow descent, but look at the fourth quarter of December.  Davis home prices were up at a time when the world was in an economic tailspin, and there was considerable uncertainty.  Always bucking the trends in Davis…

Let me know if I can help you think about this in the context of your needs.

-Jamie Madison

Davis Homes: Jamie’s Pick of the Week...

Easy, gracious living at 5612 Tufts Street.  When my clients/friends bought the home across the street, Betsy noticed that people treated her more nicely when she gave them her Tufts Street address.  Tufts is a micro-neighborhood with children playing in the street, nice well-tended homes, a little diversity and more of a sense of place than you would expect to find in a neighborhood of 6 year old homes.  I know several people who live on Tufts and can personally attest!

At 2836 sq ft (on an 11,300 sq ft lot), this single story floorplan is spacious and well laid out – several large areas for casual and formal entertaining and generous private space too.  Wonderful back yard features a lap pool with automatic cover, and the kitchen has great counter space and good features (granite, 6 burner gas cooktop, etc.).  If you are passionate about cooking, you can cook while your friends stand right next to you drinking their wine, and there is still plenty of space to get the job done.

Exactly one year ago a similar home in the same block was sold in multiple offers for  $40,000 over the asking price.  This home is well priced at $819,000, or $288 sq ft.

-Jamie Madison, 530.574.0596