Which came first, the chicken or the egg?
That’s a tough question to answer, and I’ve often applied the same logic to the housing news. The newspapers say “it’s going to get worse, foreclosures are growing, prices will drop!” and people shake their heads and close their minds to purchasing a home.
But I have always wondered, what if the newspapers would just run a story “real estate prices are going up tomorrow!” Wouldn’t people run out and buy property today? And wouldn’t that solve the real estate crisis: increasing demand, decreasing supply, Econ 101, you remember.
In other words, I haven’t been convinced that the media isn’t part of the problem for the past few years. But I’m sure I’m over-simplifying things.
Happily, the news has been positive lately. Case in point, this article from the Contra Costa Times: http://www.contracostatimes.com/news/ci_20439049/strong-bay-area-housing-sales-stir-hopes-spring .
The article talks about strong March sales throughout the Bay Area. In fact, I just posted Alamo sales statistics—more sales in March this year than the entire first quarter last year.
Last month in Danville (March), there were 75 sales. The high sales price was $1,780,000 and the low was $256,000, with a median of $675,000. Last year (March 2011), the numbers were: 59 sales, high of $2,400,000 and low of $128,000, with a median of $750,000.
In Blackhawk, there were only six sales last year in March; this year we had 13.
In Alamo, there were only seven sales last year in March; this year more than triple that number: 22.
If you are following along with your adding machine, you’ll notice we had 110 sales in total across Danville, Alamo, and Blackhawk. Of those, 12 were bank-owned, and 18 were short sales. In other words, 73% were regular sales.
Last year there were a total of 72 sales across Danville, Blackhawk, and Alamo. 12 were bank-owned, 15 were short sales, and only 45 were regular sales (62%).
Things are looking up: more homes are selling, fewer distressed sales—what about price? Are prices going up? Not based on the median sales: down from $799,000 last March to $738,000 this year.