Are Buyers Losing Advantage?

Dear Sue,

My uncle suggested that I put my property search on hold. He said that there are too many things happening in the market right now to know which way it is headed. He said if it is going up, I can simply jump in, but if it is going down, I can wait.

Based on Auburn market conditions what are your thoughts? Should I put my search on hold?

Wondering Walt

Dear Walt,

In order to have the most objective response to your question possible, I asked a trusted colleague. Jared Michael, a local appraiser at First Appraisal, makes it his business to study and analyze market conditions.

He had a very interesting viewpoint regarding the Auburn market.

“The Auburn market is starting to see prices flatten out. Prices are not declining at the rate we were experiencing over all of 2007 and the first part of 2008. I have even seen a slight increase in the $450,000 and up range,” Jared explained.

He continued, “If you look at the new listings compared to sales, you are seeing a narrowing of the gap.”

Over 2007 we saw four new listings for each sale. We are now seeing two and a half to three new listings to every sale.

From May to July of 07 we saw ninety new listings per month. We are now seeing an average of fifty five new listings per month. These numbers indicate that the buyer’s advantage is shrinking. We are trending towards a better balance between a buyer’s and seller’s market.

I have seen this, Jared explained, a couple of times during the last two years.

I call it a market pause.

While the market appears to be trying to get back to a healthy balance, the various outside governmental and banking influences are creating a lot of uncertainty.

Jared believes that there are huge forces in the market at work that don’t include buyers and sellers coming to an agreement and completing a transaction. The many influences do not have balanced markets as their primary agenda. If it was a clear playing field of normal commerce taking place, I would say the stage is set for market improvement.

Jared echoes Leslie Appleton-Young, the chief economist for the California Association of Realtors. She said that the Sacramento region was one of the first real estate markets to falter and one of the first markets to recover.

Jared said that the best buys can be had at the lower end of the market. They make great investment properties. He also said that it is the best time to buy if your goal is to own and not flip.

Buying now can be a matter of good home dollars and sense.