It can be very sad when you see buyers getting priced out of properties and neighborhoods. I got a call recently from another agent looking for a nice home up to $1 million in Terra Linda. The inventory in that price category has been scarce. When something under $1 million does comes on the market like my listing at 382 Holly Drive, it attracts multiple offers and quickly becomes out of reach. I closed Holly Drive for $1,140,000.
Holly Drive was not a fluke. In December I listed 564 Montecillo Rd for $999,000 and we received 15 offers and closed at $1,165,000! Even my most recent listing at 457 Hickory Lane listed at $1,049,000 received multiple offers and got bid up. Besides sellers holding all the cards and reviewing great offers right now, what else does this mean?
First it means a lot of buyers are missing out on homes they’d like to purchase, even though they are willing to offer more than what the sellers are asking. It means a lot of broken hearts and dreams that become more distant as time passes and the prices continue to rise. Buyers are starting to feel the squeeze now from lenders too, as interest rates have risen recently and they are looking at higher monthly payments for the same house.
That reminds me of a comic I saw on a Realtor social media page the other day. It was a drawing of a Realtor showing a house to a couple. The caption read, “Or if you want to see something more expensive, I can show you this again tomorrow.” It’s kind of true and funny, and at the same time not funny at all for the buyers who are doing everything within their power and still coming up short.
What typically happens in this situation is buyers need to adjust their strategies. They need to come in higher and better when they are one of several or more offers competing against each other. Otherwise they need to look at more modest homes in the same area or start looking in different neighborhoods. Last year I was working with a lovely couple and we sold their townhouse in San Rafael. They wanted to buy up in San Rafael into a single family home because they were having a baby but the market was too crazy. So, they purchased a very nice home in Novato for just over $1 million. The same home in Terra Linda would have been about $200,000 more. Everything worked out even better because the husband works just a few minute walk away.
Everything happens for a reason. Sometimes that reason can be good. Other times it’s just sad.