January 5, 2006

Mr. Toad’s Wild Real Estate Ride in 2005

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Mr. Toad’s Wild Real Estate Ride in 2005...and What You Can Expect in 2006
- by Jeff Hoffman

© Jeff Hoffman- All Rights reserved
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Having returned from a 3-day vacation to the “happiest place on earth” in November, I found myself thinking about the similarities between one of my daughter’s favorite rides, “Mr. Toad’s Wild Ride”, and this year’s real estate market.

The beginning of the year marked a continuation of our robust seller’s market. We had a constricted housing supply with only 210 homes listed for sale. The pending sale index was humming along at 37% (the pending sale index is a measure of the % of homes under contract versus the currently listed inventory). Time to sell a home was 14 days. It was a great time to be a seller.

Fast forward to December 2005 and we see what a difference a year makes. There were 473 homes listed for sale during the month, with a pending sale index of only 10%. There is a 300% increase in the time required to sell a home from 14 to 43 days. Week to week 8%-12% of area seller’s were dropping their list price in an attempt to find a buyer.

2006 is shaping up to be a market in transition. I believe we will see inventory levels that continue to mirror those of 1994-1997. The time it takes to sell a home will continue to move upward approaching 60-90 days. Standing inventory levels will approach a 4-6 month supply of homes.

For more perspective read what the California Association of Realtors Housing Market Forecast is predicting for the coming year.

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Jeff Hoffman is the President of Hoffman Realty Group, Inc. and has assisted in over 100 relocation transactions during his real estate career. He is the creator of a powerful home selling system designed for the home seller not the real estate agent. To learn more about his Smart Seller Home Selling System visit
www.SmartSellerListing.com

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