The Next 3 Sales..
With coronavirus sweeping the country and causing the mass lockdowns of major cities, shelter-in-place rules enacted and the economy screeching to a halt, the state of the real estate market is somewhat up in the air. The Condo Weekly team is working quickly and diligently to ensure the market remains stable.
While I can’t begin to predict the longevity and repercussions of the virus, what I do know is that real estate sales are a lagging indicator of group psychology. We won’t see the effects on real estate value as immediately as we do in the stock market.
The next 3 sales in every building are extremely important. The next sales will dictate the AC (after coronavirus) values within our communities. Before coronavirus & the impending recession we are facing, the condo market had been stable, and flat, since 2017/2018. San Francisco and San Jose’s markets had seen a steady value increase from 2012 through early 2018, where values had stalled at a relatively strong & predictable level. The next 3 sales within a building or community are the most important sales in recent history as they will dictate the comps for the next 12-24 months.
It is imperative that listing agents fight to retain pre-coronavirus values in all properties selling this month and next. All it takes is one listing to sell for 5-10% below BC value to set the trend of a devalued real estate market.
We urge all listing agents to reject opportunistic buyers in the market looking for a deal due to this pandemic in favor of retaining value for the entire community, rather than getting themselves a quick paycheck in the face of turbulent times in our industry. While I understand some sellers will be in need of selling their homes and moving on, it is in the entire city’s best interests to negotiate strongly in favor of pre-established values.
In the span of the last few days, the Condo Weekly team has strategized, created and implemented an essential tool for all agents in the market: a crowdsourced list of active buyers.
We compiled this by contacting all the top-selling agents in the market, who shared a list of their active buyers. These lists included what they’re looking for, their ideal buildings, ideal price point, desirable timeline, along with other relevant data. These buyers who were active before the economic halt understood the value of the homes they were looking at and were willing to pay pre-established property values. All agents in the community will have access to this list and should use it to ensure properties sold in the next month or two are sold for similar values to what they were worth in January/February.
Our team will fight against the insinuation that now is a time to ‘get a deal,’ as it hurts the entire community as well as indirectly hurting the person that buys the property in the long run by devaluing the building they purchase in.