Let’s review an exciting year of real estate in 2005.
Attached properties…
Condominium and town homes enjoyed an excellent year, despite the large amount of competition between them. Inventory levels of attached properties remained high with sellers remaining firm in their asking prices and achieving 5% appreciation over the same periods during 2004. The number of attached properties sold this year in Carlsbad decreased by almost 20%. However, when comparing the last half of the year of 2004 to the same time period this year, the average sales price have seen a rise of approximately 5% to 7%.
Single Family Homes…
Though single family homes remain in great demand, the number of resale properties sold this past year decreased by approximately 7% in comparison to 2004's numbers. An explanation for the drop is due to the introduction of the 30 new-home communities that have been built and are selling in Carlsbad. These additions have lured buyers to consider purchasing new construction. Although the number of sales lessened, the average sales price rose as much as 16%*. Overall, a general uncertainty of the direction of the market has created an environment where neither sellers nor buyers have the clear upper hand when it comes to negotiating a price.
*This data reflects comparisons of June 1 – December 12, 2004 to the same time in 2005.
Incentives…
During the first months of 2004, the average length of time the property would stay on the market could be counted on two hands. Consumers reacted by cutting the costs associated with paying representation to find a qualified buyer. New-home tracks also cut their incentives to buyers. In 2005, resale and new-construction homes were faced with a difficult market, more inventory and increased competition. In order to grab a larger share of sales this year, new construction projects began offering valuable incentives such as interior upgrades and landscape packages. Additional cash incentives were also offered to real estate professionals to encourage them to search for buyers interested in a new community. Another large change was the return of full commission to real estate professionals increasing the average buyer-agent commission from 2.5%, to nearly 3%.
Value range marketing…
Pricing a home with a low and a high price became the preferred method in 2004. Value range pricing in 2005 continued to be the preferred method of pricing a home in Carlsbad and encompassed 57% of all homes sold. Professionals have found that if a consumer is doing their own initial searching, a home with range pricing will come up more often during their search, exposing the property to more potential buyers.
Interest rates…
Interest rates continue to grab the attention of homebuyers and real estate professionals alike. The affordability factor in the last several years has helped Carlsbad real estate reach new levels of appreciation. 2005 saw interest rates rise steadily while sales prices remained stable. This was largely due to the fact that many Carlsbad sellers were not in a position where they were forced to sell and therefore unwilling to lower their price below their expectations. Many homes in Carlsbad continue to see appreciation due to limited availability, while some neighborhoods simply have more on the market. A new milestone was achieved in 2005 with the highest price of $5,750,000 paid for a single-family beachfront property home in Carlsbad.
Market time…
The market time is the length of time between when a property is initially offered and when it sells. 2005 saw the average market time increase over 2004 to an average of 60 days. True market time could be as high as 90 days due to agents refreshing their listings. Refreshing a listing is when a property will be cancelled in the Multiple Listing Service and re-entered as a new listing. The property then appears to be a fresh, new listing and the overall average market time in Carlsbad is affected. The importance of watching market time has become more popular as analysts attempt to predict a slow-down in the market-place, which will signal a decline in prices. 2005 also showed that 60 to 90 days of market time did not signal much more than a healthy competitive marketplace.
Attached properties…
Condominium and town homes enjoyed an excellent year, despite the large amount of competition between them. Inventory levels of attached properties remained high with sellers remaining firm in their asking prices and achieving 5% appreciation over the same periods during 2004. The number of attached properties sold this year in Carlsbad decreased by almost 20%. However, when comparing the last half of the year of 2004 to the same time period this year, the average sales price have seen a rise of approximately 5% to 7%.
Single Family Homes…
Though single family homes remain in great demand, the number of resale properties sold this past year decreased by approximately 7% in comparison to 2004's numbers. An explanation for the drop is due to the introduction of the 30 new-home communities that have been built and are selling in Carlsbad. These additions have lured buyers to consider purchasing new construction. Although the number of sales lessened, the average sales price rose as much as 16%*. Overall, a general uncertainty of the direction of the market has created an environment where neither sellers nor buyers have the clear upper hand when it comes to negotiating a price.
*This data reflects comparisons of June 1 – December 12, 2004 to the same time in 2005.
Incentives…
During the first months of 2004, the average length of time the property would stay on the market could be counted on two hands. Consumers reacted by cutting the costs associated with paying representation to find a qualified buyer. New-home tracks also cut their incentives to buyers. In 2005, resale and new-construction homes were faced with a difficult market, more inventory and increased competition. In order to grab a larger share of sales this year, new construction projects began offering valuable incentives such as interior upgrades and landscape packages. Additional cash incentives were also offered to real estate professionals to encourage them to search for buyers interested in a new community. Another large change was the return of full commission to real estate professionals increasing the average buyer-agent commission from 2.5%, to nearly 3%.
Value range marketing…
Pricing a home with a low and a high price became the preferred method in 2004. Value range pricing in 2005 continued to be the preferred method of pricing a home in Carlsbad and encompassed 57% of all homes sold. Professionals have found that if a consumer is doing their own initial searching, a home with range pricing will come up more often during their search, exposing the property to more potential buyers.
Interest rates…
Interest rates continue to grab the attention of homebuyers and real estate professionals alike. The affordability factor in the last several years has helped Carlsbad real estate reach new levels of appreciation. 2005 saw interest rates rise steadily while sales prices remained stable. This was largely due to the fact that many Carlsbad sellers were not in a position where they were forced to sell and therefore unwilling to lower their price below their expectations. Many homes in Carlsbad continue to see appreciation due to limited availability, while some neighborhoods simply have more on the market. A new milestone was achieved in 2005 with the highest price of $5,750,000 paid for a single-family beachfront property home in Carlsbad.
Market time…
The market time is the length of time between when a property is initially offered and when it sells. 2005 saw the average market time increase over 2004 to an average of 60 days. True market time could be as high as 90 days due to agents refreshing their listings. Refreshing a listing is when a property will be cancelled in the Multiple Listing Service and re-entered as a new listing. The property then appears to be a fresh, new listing and the overall average market time in Carlsbad is affected. The importance of watching market time has become more popular as analysts attempt to predict a slow-down in the market-place, which will signal a decline in prices. 2005 also showed that 60 to 90 days of market time did not signal much more than a healthy competitive marketplace.