A Summers View of the Forest from the Trees

Well, the traditional selling months have come and gone for Alameda real estate, and it's left most of us scratching our heads. There were properties we believed would sell in a heartbeat that stuck around all summer long while others were flying off the market receiving multiple offers for reasons we just couldn't figure out. I would often joke that the best tool in my REALTOR tool box this summer seemed to be my Crazy-8 ball!!


In order to try to make rhyme or reason out of the market, I decided to compare Summer 09 and 10 using several key indicators - number of homes sold, number of homes available, average price per square foot and average months of inventory on the market -broken down by type of property - Single Family Residence, Townhouse and Condo -and by location - All Alameda, Main Island (94501) and Bay Farm/Harbor Bay (94502). Once compiled, the data was averaged and compared. I found the results turned out quite interesting. Hold onto your hats, there's lots of statistics to wade though!

The 30,000 foot view….. It came as no surprise to find we had a slow moving market this summer. The number of properties sold dropped by 28% while the properties available for sale increased by 29%. The result; the number of months of inventory on the market almost doubled. Although movement lagged, the average price per square foot actually increased slightly - 1% compared to last year. So the question arises, if prices have stabilized why have sales slowed? Especially when you consider interest rates are the lowest we've seen in decades.

There are several reasons heavily discussed in the media supporting why the market was slow this summer. Buyers are still wondering if we've hit the bottom, the overall fear of a double-dip recession and the assumption that banks are not lending. However, we have an additional concern in Alameda; “What will become of our schools next year?” Believe me, a week does not go by without hearing buyers state "We're waiting until the spring when we know about the schools." A survey taken by the National Association of Realtors found 27% of home buyers listed school quality and 21% listed proximity to schools as deciding factors in their home purchase. Interesting enough given we saw a 28% decline in sales volume over last year! Of course there is something we can do to remove this concern, pass a parcel tax this spring. Please visit and bookmark Alameda SOS Save Our Schools to stay informed ... but I digress...

Down to the forest level….. The decrease in sales volume was about the same for the 94501 area as compared to 94502, however the remaining indicators reflect the main island seemed to adjust to this new market faster. Though higher in 2010, the increase in available properties and months of inventory on the market on the main island were markedly less, about 1/3 the increase as seen on Bay Farm. In addition, 94501 saw a 4% increase in price per square foot whereas Bay Farm experienced a slight decline - 3%. So why would homes take longer to sell in Bay Farm and a sell at a lower price? I believe the real culprit is short sales These sales typically take longer to sell and sell below market. Currently 24% of properties on the market in Bay Farm/Harbor Bay are short sales, compared to 10% on the main island. This is definitely high enough to skew the summers results.

Now for a few of the trees…… Condo's (predominantly in 94501) represent about 15% of our market and continue to be the toughest market in Alameda. It experienced a 52% decline in sales volume, and a 241% increase in months of inventory on the market, still there was an increase in price per square foot of 3%. Townhouses make up another 15% (predominantly in 94502) of the market and fared a bit better in sales volume, declining 24% overall, but lost 7% in the price per square foot indicator.

Of course single family residences represent the majority of the transactions occurring in Alameda with the greatest number falling on the main island. Of all the property types, these seemed to fare best this summer. We experienced a 22% decrease in sales volume of single family homes, about the same throughout the island, with properties available only increasing by 9%. In addition, price per square foot increased 4% (6% increase in 94501; 4% decrease in 94502).

What is interesting to me is though the market felt like it was all over the board, the numbers reflect buyers were still apprehensive to pull the trigger, but when they did, values remained stable and Alameda continued to be a desirable market.

So there's my call for the forest and the trees of Alameda! If you're interested in getting an even closer look at the market, please contact me and I'll be happy to provide detailed information for your neighborhood of interest!

Information obtained from Trendgraphix Fact and Trends; deemed reliable but not verified.

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Alameda has many challenges ahead; protecting quality education in difficult economic times, balancing the development of Alameda Point with the effect of growth on our city and maintaining a strong fire and police department to keep our streets safe. In a few weeks we'll be electing a new Mayor, 2-3 City Council Members and 2 School Board members. Please be sure and vote November 2nd, your vote WILL make a difference!!