Wild party or hospital visiting hours?
I keep my finger on the pulse of the market in any number of ways, but mostly by just showing up, a strategy I've found not only gives me insight but puts food on the table. Lately I've been a habitué of open houses, as an agent holding open my own listing, as an agent showing buyers the sights, and as an agent "previewing" (scouting) large numbers of likely homes for clients I've just met.
What strikes me these days is how much open house activity varies from market to market. The atmosphere varies as well, from festive to funereal. But what's equally striking is that open house activity doesn't necessarily translate to market activity. Today, seemingly more than ever, tire-kickers are out doing what they do.
You wouldn't think they'd bother, given the gloom—umpteenth month of price declines!—and uncertainty surrounding real estate on the national or even regional level. But at the local level, I think lots of people are feeling their personal confidence index edge up, and they're dipping their toes in the real estate water. And you know where that leads. "I'll try just a little" becomes "gosh I'd like a little more of that" and pretty soon they're rolling in the gutter clutching a 30-year fixed.
But home-buying isn't quite a mass movement yet. I won't talk about my own listing, a top-end townhouse in Menlo Park, since it's still a pending sale, except to say that I was gratified by the turn-out for the two week-ends of open houses we did, averaging about fifty people per day, particularly good for a type of housing lacking broad appeal, and that the result of all that activity was a sales price that met the seller's expectations. On the other hand, I think the buyers did well too, since the seller didn't expect a 2005 price. One of those win-win situations real estate is known for.
Then there's Palo Alto, particularly the "affordable" end of the single-family range, a buyer magnet through thick and thin. A few Sundays ago I was at an open for a small old rancher that backs to the railroad tracks—can you say "high-speed rail?"—and had gaping holes where the oven and dishwasher used to be. But the house was priced to make you overlook small details, and buyers were all over it. Palo Alto might be the only market where buyers are willing to ignore the huge question mark that's high-speed rail: will it run through a discrete culvert or atop a government agency's tribute to the Berlin Wall? Offers were due the next day and, sure enough, it went promptly into contract. Which will surprise people who measure quality of life by the square inches of granite in their kitchen.
That same Sunday I was down in Cambrian San Jose, a sprawling neighborhood of generic, humble ranchers with lots of strip malls and great schools. I don't think high API scores come any cheaper this side of the Bay. Apparently bang for the buck wasn't enough to get Ma and Pa into the minivan and out looking at homes, at least not this particular Sunday. Open house attendance was spotty, agents bored and listless or worse, and the gloom hung heavily over a market that's been feeling poorly since the first-time buyer tax credit expired last spring—and yet, prices are still about where they were at this time last year.
Somewhere in the middle, but tending more toward liveliness, was the San Carlos open house I was summoned to the previous Sunday. The home was attractively priced, at least if you hadn't read the reports, or wondered whether the second bath was legal, or peered over the back fence and seen the school play yard, or hung around the front long enough to realize the street was busier than it looked, and attendance was upbeat and brisk. The listing agent was a pro who had the home, a mundane example of the species San Carlos rancher, looking its Sunday best. Sensing a frenzied last-minute thrash to get the house presentable, I asked her if she'd had much to do. Gosh, no, she said, and later I saw all the contractor invoices in the disclosure package. Listings are hard work when done right. Well, with such a great turn-out, and with a whopping eleven disclosure packages out, you'd expect a torrent of offers, right? Just—"just"—three offers, still enough to boost the sales price above list. San Carlos has lots to offer, even to someone living in a less-than-ideal home in a less-than-ideal location.
The pulse of our market varies, by neighborhood, housing type and price range, and the patient has his good days and his bad, but his vital signs remain stable. And sometimes he has lots of visitors.