Carlsbad's supply of homes has increased and could signal change in the recovering and still-fragile real estate market. The current months of sellable homes — a number derived from the average number of homes for sale versus the number of sales — has increased by more than 50 percent from lows of 2.5 months in early 2010 to 4.8 months in July. And although still historically low, an increase in the number of homes gives buyers more options, encourages negotiation and can be a precursor to falling prices should the supply amount exceed eight months.
The low supply of housing helped turn around the declining real estate market. Inventory levels in Carlsbad dropped from an average of 12 months in 2008 to 2.5 months by summer of 2009. The drop in inventory was a result of lower mortgage rates, restricted foreclosure activity, few new construction projects, and homeowner reluctance to sell in a down market. The low 2.5 months of inventory caused falling home prices to stabilize, homeowners to secure more of their asking price (99 percent from 96 percent) and time-to-sell fell from 90 days to 30 days. The real estate market experienced a brief recovery.
With the lower market time and higher percentage of asking-price to sale-price, the average asking price in Carlsbad has moved up to $756,000 in July 2010 with a final sale price of $726,000. The average single-family home for sale in Carlsbad during the last half of 2009 had an asking price of $710,000 and a sales price of $707,000. With new construction projects reopening and more homeowners putting their homes on the market, Carlsbad is expected to have higher inventory levels through the rest of 2010.
The current supply of Carlsbad housing is notable, but not alarming. Historically, the number of homes for sale increases throughout the summer months in Carlsbad. The current increase in supply comes as a relief to many home buyers who have searched for months with scant housing choices. But both buyers and sellers can do well for themselves to watch the supply of housing over the coming months. Should the number of homes continue to increase into the winter months, homeowners can expect to face tougher negotiations and possible price reductions. Buyers can expect to negotiate better deals. And already the average market time has increased as a result of increased supply. The average time to sell in Carlsbad has increased from a low of 30 days to now 45 days before a home is sold.
For sellers wanting to be in escrow before the winter market, when sales often decline by as much as 30 percent, continually reassess your current number of showings and buyer interest level. Homes of similar size with comparable amenities can come on the market at a lower asking price and alter the perceived value of your home. Reassessing the market every day will help you decide if a price adjustment is needed. The current asking price should be no more than five percent more than the prices of comparable sold homes. If you have few showings and little interest from the brokerage community, find out why. A negative feature of your home could be the culprit — proximity to a noise nuisance, visual distraction (power lines) or substandard interior improvements. You have to find a way to adjust your expectations to meet the expectations of the current buyers.
Condos and townhouses in Carlsbad have 4.3 months of inventory, which is an even market number for the current sales pace. The average time on market is 51 days for an attached home. Condos and townhouses are also securing 97 percent of asking price. The average two-bedroom, two-bath, 1432-sq.ft condo sold for $390,000 in 51 days. And although the average sales price has moved up from $354,000 earlier in 2010, this is due mainly to higher priced attached property selling and inflating the averages.
For more information, contact Tyson Lund at (760) 438-0800.
The low supply of housing helped turn around the declining real estate market. Inventory levels in Carlsbad dropped from an average of 12 months in 2008 to 2.5 months by summer of 2009. The drop in inventory was a result of lower mortgage rates, restricted foreclosure activity, few new construction projects, and homeowner reluctance to sell in a down market. The low 2.5 months of inventory caused falling home prices to stabilize, homeowners to secure more of their asking price (99 percent from 96 percent) and time-to-sell fell from 90 days to 30 days. The real estate market experienced a brief recovery.
With the lower market time and higher percentage of asking-price to sale-price, the average asking price in Carlsbad has moved up to $756,000 in July 2010 with a final sale price of $726,000. The average single-family home for sale in Carlsbad during the last half of 2009 had an asking price of $710,000 and a sales price of $707,000. With new construction projects reopening and more homeowners putting their homes on the market, Carlsbad is expected to have higher inventory levels through the rest of 2010.
The current supply of Carlsbad housing is notable, but not alarming. Historically, the number of homes for sale increases throughout the summer months in Carlsbad. The current increase in supply comes as a relief to many home buyers who have searched for months with scant housing choices. But both buyers and sellers can do well for themselves to watch the supply of housing over the coming months. Should the number of homes continue to increase into the winter months, homeowners can expect to face tougher negotiations and possible price reductions. Buyers can expect to negotiate better deals. And already the average market time has increased as a result of increased supply. The average time to sell in Carlsbad has increased from a low of 30 days to now 45 days before a home is sold.
For sellers wanting to be in escrow before the winter market, when sales often decline by as much as 30 percent, continually reassess your current number of showings and buyer interest level. Homes of similar size with comparable amenities can come on the market at a lower asking price and alter the perceived value of your home. Reassessing the market every day will help you decide if a price adjustment is needed. The current asking price should be no more than five percent more than the prices of comparable sold homes. If you have few showings and little interest from the brokerage community, find out why. A negative feature of your home could be the culprit — proximity to a noise nuisance, visual distraction (power lines) or substandard interior improvements. You have to find a way to adjust your expectations to meet the expectations of the current buyers.
Condos and townhouses in Carlsbad have 4.3 months of inventory, which is an even market number for the current sales pace. The average time on market is 51 days for an attached home. Condos and townhouses are also securing 97 percent of asking price. The average two-bedroom, two-bath, 1432-sq.ft condo sold for $390,000 in 51 days. And although the average sales price has moved up from $354,000 earlier in 2010, this is due mainly to higher priced attached property selling and inflating the averages.
For more information, contact Tyson Lund at (760) 438-0800.