Wednesday, May 13, 2009

As The Nation Goes Alameda Goes

The National Association of Realtors reported that home prices fell in nearly nine out of every 10 U.S. cities in the first quarter of 2009 as first-time buyers looking for bargains dominated the market and banks continue to manage foreclosed properties. Alameda was amongst those cities that saw prices continue to fall. In yesterday’s report the median sales prices of existing homes declined in 134 out of 152 metropolitan areas compared to the First Quarter of 2008 verses 2009. Nationwide, sales of distressed (foreclosed and short sales) properties made up about half of the sales in the market.

Alameda was not immune to the drop in average sale price. Prices year-over-year dropped 13% or over $80,000. From the Fourth Quarter 2008 to the First Quarter 2009 saw prices drop 8% more that $45,000.

Alameda First Quarter 2008 Sales Average: $631,627
Alameda Fourth Quarter 2008 Sales Average: $596,557
Alameda First Quarter 2009 Sales Average: $550,881

Six states California, Nevada, Arizona, Florida, Virginia and Minnesota saw an increase in sales where buyers have been able to snap up foreclosures at a deep discount. The volume of inventory has seen a sharp decline.

In a
Wall Street Journal article, that also ran yesterday, the number of homes listed for sale in many U.S. cities continued to fall in April. A few analysts see the decline in inventory a sign that the market may be nearing a bottom, but these same people can not predict how many foreclose properties are still looming and will hit the market in the next few months. At the end of April, the inventory supply of homes for sale in 29 major metropolitan markets was down 3.6% from a month earlier.

The news is very difficult to interpret for our micro-market of Alameda. The Island’s inventory has continue remain stagnant and price have continued to drop. April showed nine properties sell over list price and the median list-to-sale ratio was 98%. The only cure for the market is time. Just need to sit and continue to watch.

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