More Pasadena homes came on the market in January compared with a year ago and that could indicate sellers are trying to get a jump on an active spring sales season, according to local Realtors.
The January home sales report by the Pasadena Foothill Association of Realtors indicates an increase in inventory and that may be good for home buyers. Sellers will need patience or consider adjusting their selling price if they want a shorter time on the market, some Realtors say.
According to the report, new January inventory in Pasadena is up 19 percent over last year with 253 homes coming on the market last month compared with 212 homes going up for sale in January of 2018.
Total active listings in Pasadena were up 43.5 percent over last January, with 495 homes for sale compared with 345 for sale during January of 2018.
Check out the Pasadena Foothill Association of Realtors report here
“The numbers indicate to me that people are putting their houses on the market earlier and getting a jump on spring,” said Pasadena Realtor Darrell Done in accounting for the increase in inventory. “3.2 months of inventory is low and last year’s 2.3 months was historically low.”
The average listing price in Pasadena is $1.8 million compared with last year’s $1.7 million, an increase of 3.3 percent. But more telling, Realtors say, is the median home price which this January gained 4.8 percent at $1.1 million compared with last year’s $1.05 million.
The median price of a home is the price whereby an equal number of homes are priced higher and an equal number of homes are priced lower. Realtors use this number as a guide rather than the average home price because particularly in Pasadena zip codes, there is a wide range of home values, from $800,000 and on up to $4 and $5 million.
Is the new report a reflection of national trends?
“Yes and no,” said Lawrence Yun, chief economist and senior vice president of research at the National Association of Realtors. “The yes part is that inventories are rising, so the early part of last year 2018 we had an acute shortage of inventory and then about the second half of year both in Pasadena as well as the rest of the country we saw a steady buildup of inventory. With more inventory showing up in the market, giving consumers more options, consumers are ready to step back into the market.”
Yun added: “One additional catalyst is that mortgage rate drop towards the latter part of December so the January activity is also being induced by lower mortgage rates.”
Jordan Levine, deputy chief economist for the California Association of Realtors said that the tables have turned for California and it’s a challenging environment for sellers.
“Supply-side problems have become demand side problems,” Levine said. “We’ve gone so many years without enough housing. As a result it pushed the prices up faster than income. Homeowners are pushed out of reach so that’s a demand problem.”
The increase in homes coming to market may also have to do with people wanting to take advantage of Prop 13, Prop 60 and Prop 90 which enable home buyers to relocate but keep their tax base and apply it to their new home.
Levine pointed out that state-wide, sales declined during the second half of 2018, with a 10 percent drop in the last quarter of 2018, a 13 percent decline in November of 2018 over the previous year and an 11 percent decline in December of 2018 compared with the same month in 2017.
“All real estate is local, street by street,” Done said. “When you read the national reports it’s always open to interpretation.”
Done said today’s buyer can afford to be more choosy when selecting the home, whether they are first-time buyers or “Baby Boomers” who may be downsizing.
He said there are some simple reasons homes may not be moving in a surplus market.
“The home may be unrealistically priced,” he said. “Buyers have so much data available to them and they’re very savvy. They know when a house is fairly priced.”
