My Friends,
It’s an election year, a time when most Americans are concerned about the direction of the country and prefer to put off major decisions until after the election, such as buying or selling a home. It is in our nature to protect our biggest asset during times like these, and judging by the rhetoric, you have to be concerned about our country’s future.
But that’s not what is happening. You won’t believe this. Let’s look at 1st quarter stats from 2015 and now 2016.
People are actually selling their homes. Would you believe there was an INCREASE in homes sold in Beverly Hills? Between the 1st quarter of 2015 and the same period in 2016, there was a whopping 18% increase, from 32 to 39 properties. It didn’t change the $/sq ft at $1,276/sq ft in 2016. But it did bring down their average price of a closed sale from $6,293,125 to $5,532,462, leaving 2016 only 88% of the average 1st quarter sale in 2015. Drilling down even further, it appears the Sellers held tough, even though there were more of them. In the 1st quarter of 2015 Buyers were only able to negotiate a 4.5% reduction off the listed price, but in 2016 it has dropped to 2%.
What does this mean? More Sellers putting more inventory on the market, holding tighter on the listed price during negotiations, maintaining a steady $/sq ft, but having their homes on the market for a longer period of time (82.23 days in 2015 versus 103.81 days 1st quarter in 2016).
Beverly Hills is the bellwether standard for the rest of the country, and certainly other parts of Los Angeles. So, did Westwood and Century City follow their lead? You would think so, but not quite.
There was a 35% increase in homes sold, from 26 in 2015 to 38 in 2016, and our average selling price remained within a 5% range, from $2,198,365 in 2015 increasing to $2,312,842 in 2016. There also was a corresponding 6.1% increase in $/sq ft, from $810.96 in 2015 to $863.48 in 2016. But where the numbers got interesting was in the Days on Market (DOM), dropping 41% from 67.8 to 40.84 in 2016. Wow!
Put all that together and it seems that a higher overall percentage of homeowners in Westwood and Century City were selling their properties in the 1st quarters, and they held tighter to their price, leaving only 1% on the table in 2015 and essentially NOTHING in 2016. They came on the market at a more accurate price point because their DOMs reflect a very quick marketing period of 41 days now. This could all mean that the buyers perceived better value in Westwood and Century City, or it could mean a more motivated set of sellers. Either way, it was a more robust and dynamic housing market in Jim Wooden’s town than their rich brother next door.
Americans are still facing the Democratic and Republican conventions, which I’m sure will have an impact on the decisions of buyers and sellers. Those stats remain to be seen. That being said, the inventory remains very low, the pool of buyers is increasing every day, and homeowners who become sellers choose to do so in one of the most amazing seller’s markets in history.
As a closing, join us on April 25th from 6:00 to 8:00pm. Several community organizations will be hosting me for an evening at the Westwood Library on Glendon to talk about my first book, “23 Hours”. Another great community event for Westwood.
Hope to see you there.
Mark
