Having just returned to sunny Southern California after a week of much needed R and R in the frozen tundra of the Northeast, New York to be specific, I find myself in need of a refresher course to get ready for the new year in real estate. I now know from firsthand experience, that the weather influences markets throughout many parts of the country. When the wind chill is below zero, I cannot imagine getting in the car and driving anywhere with my Realtor, in search of anything. In fact even though I was on vacation, I found myself thinking, “I’m not going outside today…” Thankfully for Southern Californians, this is not such a problem. It is for this reason that the real estate market here doesn’t pause for inclimate weather. Oh sure, if it’s pouring rain for a few days, we might postpone our house hunt until it stops, but given we’re in the throes of a never ending drought, even that is a distant memory. No, house buying and selling really doesn’t have much of a weather season here. There are still however seasonal trends and strategies for when to buy and when to sell.
It should come as little surprise that the spring is the peak buying/selling season pretty much everywhere. People want to move toward the end of school and so they start thinking about buying or selling right around February. In this way, Southern California is no different. I tell all my clients that Super Bowl, literally is the kickoff of the real estate season. In spring, selling prices are higher favoring sellers but selection is better, favoring buyers. It is for this reason that I encourage all my sellers to get on the market before Super Bowl if possible, to take advantage of low seasonal inventory, but to set their pricing as if it were mid-March. This is a strategy that has proven very successful for my sellers. Less competition means shorter marketing times to sale. It also means better offers and typically closer sales-to-list-price ratios. And since so few Realtors think this way, I also encourage my buyers to buy early in the year because they can take advantage of lesser informed sellers who price their homes with an end of year mentality, thus not anticipating the prices of the coming months. This equates to better buys for my buyers.
Strategies abound in real estate. There’s strategies for negotiating; approaches to pricing and methods for home preparation that give a seller an edge over their competition. Presently I have two sellers in prep-mode. They are actively decluttering, giving to Good Will and cleaning. I’ll bring in my decorator as I am doing for one client this afternoon, to put the final touches on our project so that we can hit the ground running and enter the market before Super Bowl. For another, that timeline just wasn’t realistic, but they are pushing hard to be on the market before the 3rd week of February. Between now and then, they will do all of the above along with painting and new carpet and even some tile floors in the bathrooms. Total cost? I estimate less than $10,000. Yes they’ll need to come up with that money somehow, but net return on investment? I told them I will at least double their money if not quadruple it and lessen the selling time by weeks if not longer. Like I say, strategies abound in my business, it’s just that so few actually implement them. And by the way, if this market holds to the latest trend, buyers want finished, move in ready properties. If a home is not truly ready to go, the final sales price is going to be substantially lower and it could take a long time and several price reductions before it sells.
As I prepare for 2014 and try to get my “sea legs” back after a week of vacation bliss, let’s take a quick peek at some numbers for my local market…
The Conejo Valley has yet to break 400 available homes on the market (393). That’s still anemic by historical measure. Good for sellers, not so good for buyers. Let’s also look at the first 25 days of 2014 (111 closed escrows) and compare that to 2013 (115 closed escrows). This means what? I conclude, it looks like it’s going to be another good year for real estate. Further, I anticipate that inventory will eventually break 400 total units for sale at some point in the not too distant future but I think I should have my newest listings on before that happens. Am I the only Realtor who thinks like this? Heck no, there are many in every community. However given the high number of people that carry a real estate license, I would suggest that as a percentage it’s not very high. So pick your Realtor wisely if you want to get the highest price, in the least amount of time and if you want to pay an under market price with the least amount of competing buyers. There is no shortage of licensees in my business but like any business, they’re not all created equal. The good news is that you choose who you want to work with. I encourage you to choose a top agent and take advantage of this market, it’s going to be a good year so make the most of it.