Second look at Redondo Beach October 2007 sales
I went ahead and tried updating my SUPPLY and SALE records with more October 2007 sales data that has come online for Redondo Beach. Unfortunately, the data is still questionable, but since there is now more of it I can at least assume my data comes a little bit closer to the truth. I have thrown out 2 extreme outliers.
STAT APR 2007 MAY 2007 JUN 2007 JUL 2007 AUG 2007 SEP 2007 OCT 2007 records 114 91 62 78 51 68 44 MEDIAN $799,000 $777,000 $764,500 $860,000 $850,000 $857,000 $755,000 AVERAGE $884,271 $855,228 $830,711 $880,279 $867,925 $935,506 $770,416 MIN $470,000 $453,000 $485,000 $359,000 $365,000 $369,900 $369,900 MAX $1,750,000 $1,640,000 $1,565,000 $2,299,000 $1,510,000 $2,400,000 $2,560,000
Prices still show a large dip in October. So the well-heeled check-writing high-end buyers could be holding back, waiting for better opportunities, or the wannabe high-end buyers are thwarted because they cannot get financing, or perhaps the high-end buyers are packing their bags and leaving in a huff looking to buy elsewhere. I just don't know.
I confess I was a bit stunned by that "max" sale. That property was built in 2001 and sold new in 2001 for $1,485,000. It has 4,698 square feet, 5 bedrooms, 5 baths. Has it really appreciated up to $2,560,000, or is there some kind of weird "cash back" deal going on?!?
DOM appears to be edging up. Some properties truly have been on the market for outrageously long periods of time. One brand new property on Anita Street that sold in October was actually on the market for over 500 days, although I seriously doubt a realtor would state that. Anyway, median time on market is roughly 3.5 months, and average time has moved up to 6 months! Some listings are sitting there and rotting. Remember, I start counting days from when a property is FIRST listed, I don't count days from the first day of the last listing before it is sold.
How much did October sellers reduce their asking prices to make their sale?
This chart is a bit awkward to read. Anything that is less than 0% means the sale price was GREATER than the original asking price. Also, in reading the labels at the bottom of the chart, the number on the right of the label is INCLUDED in the range. For example, -5-0% shows that there were 3 properties in which there was a price difference greater than -5% up to and including 0%.
So for this data, there are 4 properties (out of 35) that sold with no reduction in price or a price increase from the original asking price. For the remaining 31 properties in this dataset, there was some price reduction. The median reduction was 5.2% and the average was 6.7%. These numbers have edged up, at least for October.
Remember, for outstanding inventory, the median percent reduction is ZERO, and the average reduction was about 2.7%. A realtor was recently quoted as saying that buyers will know who the serious sellers are by those who seriously cut their asking prices. That difference between ZERO and 5.2% could mean the difference between a rotting listing and a successful sale.
Earlier this year I was assuming that the PCTRED numbers would shrink, as sellers "got wise" and started pricing their properties more realistically. At this point, I don't think most sellers have "gotten wise" yet. If the bottom were to fall out, sellers could end up chasing the bottom down. The mechanisms just aren't in place to show price reductions in "real time." Remember all the stories you read about the 1929 stock market crash, and how the ticker tape was delayed for hours? That's very much like the situation we could be about to face now.
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