“What’s going on in Princeville?”, I get asked frequently. “Are homes selling there?” Well…..the short answer is yes, sort of. The long answer….
The key to understanding Princeville residential sales right now is to divide the market up into price points. Let’s go “under 700K”, “between 700K & 1 Mm”, and “over 1 Mm”.
In our first category, under 700K, 2009 shows 11 sales, 2 currently in escrow, and 15 active listings. Of those 11 sales, 6 of them were under 600K, 4 were bank-owned REO’s, and 2 were short sales.
Next category – 700K to 1 Mm. In 2009, 3 sales, 4 or 5 currently in escrow (as sales price is not made public until closing, we don’t know whether some of these will close over or under 700K), and 19 active listings.
Over 1 Mm – no sales, 1 currently in escrow (see disclaimer about final sales price in above paragraph), 34 active listings.
What do we gather from this information? A couple of things stand out to me. One: until now, we have only seen REO and short sale activity in the under 700K domain, but that is sure to start changing. Owners of higher-end homes may often be less susceptible to the vagaries of this financial downturn, but they are not necessarily immune.
And two: while the majority of Buyers are looking under 700K, the majority of Sellers are looking over 700K. With most knowledgable observers agreeing that the market is trending downward for the foreseeable future, Buyers tend to feel that they only need to remain patient, and prices will eventually come down to meet them. And the evidence is backing them up.
A perceptive Seller should see this writing on the wall and take the lead in setting an aggressive price reduction strategy NOW, before REO’s and short sales start lowering the price benchmark for them.
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