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California is Sellers' Market as Over-List Price Sales Soar

by devteam October 31st, 2013 | Share

Nearly half of the homes sold so farrnthis year in California went for more than their asking price.  Such sales usually result from so-called “biddingrnwars” when multiple sellers submit competing offers.   ThernCalifornia Association of Realtors® (C.A.R.) reports that the 49.5 percent ofrnhomes that sold over list in 2013 is almost double the number of such sales inrn2012 (25.9 percent) and triple the 16.6 percent share in 2011.   Thern20-year average for above-list price sales is an 18 percent share.  </p

C.A.R’s released this and other datarnfrom its 2013 Annual Housing Market Survey.  The Survey also found that the tightrninventories in the state led to multiple officers in more than 72 percent ofrnsales compared to 57 percent in 2012.  Thisrnwas the highest incidence of multiple officers in at least 15 years and forrneach home that sold at a higher amount there were an average of 5.7 offersrncompared to 4.2 offers last year and 3.5 in 2011.  </p

The survey also found that an increasingrnnumber of home sellers, nearly half of those responding, planned on purchasingrnanother home in the future.  This was thernthird consecutive year that statistic has increased. </p

 “Sellers are more upbeat about the housingrnmarket and are more comfortable with their financial situation.  As thernreal estate industry and the economy continue to recover, many sellers regainedrnconfidence in owning a home since the Great Recession,” said C.A.R. PresidentrnDon Faught. “The number of home sellers planning on repurchasing, in fact,rnincreased to the highest level since 2007, which suggests that repeat buyersrncould be the driving force in the housing market in 2014.”</p

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Distressed homes continued to make uprnthe most competitive part of the market. rnNinety-one percent of owned real estate (REO) properties attractedrnmultiple offers, up from 71 percent last year. rnThree-quarters of short sales received more than one offer compared torntwo-thirds last year.  Close to seven ofrn10 equity sales attracted more than one bid in 2013, a surge from 51 percent inrn2012.</p

The percentage of cash salesrndecreased for the first time in eight years. More than 25 percent of buyersrnpaid with cash, down from about 30 percent last year but triple the 8.8 percentrnrate in 2001    The Mortgage Bankers Association projected arndecline in cash sales yesterday as part of its 2014 projections.</p

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Investors remain an active componentrnof the California market, accounting for 19 percent of sales, up from 16rnpercent the previous year and more than double the investor market at thernbeginning of the last decade.  At thernsame time the share of first time buyers fell to 28 percent from 36 percent. Itrnwas the third decline in the last four years.  </p

The share of international buyers</bpurchasing in the state increased for the third straight year to 8 percent fromrn5.8 percent in 2012 and 5.7 percent in 2011 with more than half buying a homernas a primary residence. Buyers from China, Mexico, and Canada made up the vastrnmajority of international buyers at 34 percent, 15 percent, and 10 percent,rnrespectively.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.

About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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