We are at the beginning of shift. "Shift" doesn't necessarily translate to "sky is falling". Even those who are not realtors, will testify that they see more homes on the market now that say, a year ago. Another indication we see in the field is "price reduction" by those sellers who didn't listen to their agents when it was time to price their house right the first time. I recently sold a house for $360,000. We started at $389,000 because "All the neighbors are asking about $380-$390-ish for comparable properties" sellers said. Two things to consider:
1) This happened in the heat of summer when all the buyers were on vacation. (Demand was lower than say, March-April.)
2) All the neighbors were asking this much. None had actually sold one recently. They all "wanted it". No one actually "got it".
Then one by one, all those neighbors reduced their prices and homes started to move. This "sellers asking for more than buyers were willing to pay" phenomenon was all over Sacramento area. Sellers had seen year over year of price increases and buyers who paid those prices. Until (IMHO) now.
Ryan Lindquest, Sacramento's most famous appraiser who is often quoted in the real estate section of Sacramento Bee and owner of http://sacramentoappraisalblog.com talks about this shift in detail (scroll down to the article titled "The problem of not listing in a slower market".
In my opinion we are just at the beginning of a shift and what the numbers will look like in the next few months will confirm or negate this assumption.
Remember one thing: Price of a commodity will go up UNTIL buyers stop paying that much for it. At that point we will see sellers starting to lower their prices to get their properties sold. It's all about supply and demand.
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