In times of change it follows that people will spend more cautiously, a trend reflected nationally as builders reduce production and demand for existing homes cools.

But are we having a full-fledged buyer's market?

While recession and uncertainty after the September 11th terrorist attacks have made purchasers more careful, that's not the whole story. Despite such concerns, the National Association of Realtors reports that existing home sales in October rose 2 percent when compared with October, 2000 sales and 5.5 percent above September levels.

Comments from realty professionals participating in the Realty Times Market Conditions Report™, show that trends differ depending on where you live -- in some markets prices are soft and affordability is up, while in other areas the market is fairly balanced between buyers and sellers. Moreover, low mortgage rates are making homes more afforable, a lure few buyers can ignore. Here's a sample of recent reports.

Brentwood, California

"Brentwood is taking a needed pause from our rapid double-digit price appreciation periods. The market has cooled and has come back about 10-15% off of it's highs of March and April of 2000. However, well-cared for homes in good locations that are priced well are still selling quickly. Multiple offers are rare, but not unheard of. We have at least 10 new home builders in the area who are sitting on built, unsold homes so they are significantly discounting those homes. This is putting a definite upper limit on what resale homes can ask. Once the new home inventory dissipates, look for resale prices to pick up again next year." Brian Sharp, Coldwell Banker

Hampton Roads, Virginia

"Sales of homes in the price range of "government loans", which includes VA loans and FHA loans, have remained strong, with buyers outnumbering sellers. Once the desired home price exceeds $200,000, the market is softer. The higher the home prices, the softer the market." Maggi Davis, Buyer's Broker of Hampton Roads

Mesquite, Texas

"The number of sales for October 2001 was up 9% versus October 2000, while sales reported for the greater Dallas/Ft Worth area by the local MLS was down 7%. The average sales price for Mesquite in October was also up a very respectable 13% to $108,908.

"What has changed the local Mesquite market from a sellers market to a balanced market between buyers and sellers is the building listing inventory. New properties on the market in October increased over last year by 18% resulting in a large increase of working inventory up 35% to 479 homes. All resulting in a whopping increase in the average days on market by 37% to 48 days." Bruce Erickson, Century 21 Beezley Real Estate

Freehold, New Jersey

"While overall prices are steady, the increase in inventory recently has led to a slight softening in pricing by sellers. This adjustment downward, often reflected in the numerous price reductions of late, is viewed to be a temporary short term response by home sellers. Assuming current interest rates stay unchanged and consumer confidence returns, we can expect a better than average spring market." Margaret Di Bella, Coldwell Banker

Akron, Ohio

"Generally, the real estate market in the Akron area is very robust. The market is beginning to experience a traditional seasonal slow down. However, throughout 2001, the market has been very balanced with a number of buyers in the market to take advantage of lower interest rates and also a corresponding number of homes in a wide range of styles and prices available for sale." Joe Haban, Realty One

Mechanicsville (Richmond), Virginia

"This area continues to grow as new subdivisions are approved. Home values also continue to climb as a result of the sellers' market we have encountered. Even with the economic downturn home sales continue at a brisk pace. However, the recent sellers' market has shifted to a more neutral market with a great balance of inventory available." Carl Shawler, Groome Brothers Realty

Wausau, Wisconsin

"With many homes on the market in all price ranges, it's a buyers market. Rates for mortgages are at an all time low, but since the attack buyer confidence is also at a low. Things are starting to pick up again, but most sellers are cutting asking prices to compete and get the buyers to their door." Roz & Karen Rozewicz, Coldwell Banker Action

Lake Forest, California

"Sales prices in Lake Forest continue to increase, but not as fast as the rate we saw earlier in the year. For the month of October, 83 properties closed escrow, while 61 went into either PENDING or BACK-UPS CONSIDERED status, and 29 EXPIRED, unsold. There are currently (as of November 21) 183 properties listed in the MLS. At the current sales rate, this is approximately a 3 month inventory level.

"The average sale price of a single family home for October was $361,624 and the average sale price of a condo or townhome was $190,164.

"Of the properties that sold and closed, the average sale price was 99% of the FINAL LIST PRICE, although it was only 77% of the ORIGINAL LIST PRICE. This indicates that buyers are not making offers on properties until the list price is very close to what they are willing to pay, and further emphasizes that sellers should list their homes at a realistic value, or expect to have to reduce their prices significantly before they will get offers." Vicki Lloyd, The Summit Real Estate Group

Lincoln, Nebraska

"As of late October we have moved out of a strong buyers' market into a moderate buyers' market. This has been consistent for the month of November, too.

"As a leading market indicator, new home sales set the tone for the market as a whole.

"As new home inventories continue to diminish, we are seeing fewer builders who will grant more than very modest concessions or accept less than full price offers to move their spec homes. And custom (pre-sold) sales negotiation is also growing more difficult.

"Re-sale' unit movement is trending in this direction also. We are seeing a return to more typical resale inventories and prices, too, after price softening during the past six months due to a adversity in the U.S. stock market and recent U.S. and world events.

"Nonetheless, there are still many existing and new homes that are 'expiring' or going off the market without selling. There are also many vacant homes on the market suggesting good opportunities for buyers who want a great price in return for a less than 'perfect' home." Mary & Steve Wiley, The MarketPro Group

Published: November 28, 2001

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