Montelena Neighborhood Market Report July 2018
The real estate market in Montelena remains steady as we continue through the Summer of 2018. The average days on market was 57 days, and the average sales price was $494,667. The absorption rate for July was 0.9, which indicates that the supply of homes for sale in Montelena is scarce! The neighborhood is currently in a “seller’s market,” which means that the inventory is low and the prices and interest rates are rising. It is important to consider statistics, such as the absorption rate, when writing an offer on a home or pricing your home for sale.
[Data Source: ARMLS]
What is the Absorption Rate Telling Me?
0 – 4: If the absorption rate is between 0 and 4, it is considered a “seller’s market”. There are fewer homes for sale than there are buyers looking to purchase. In a seller’s market, the seller may choose to price their home more aggressively, as there is a limited supply of houses for sale. The seller, in general, will have a lot more leverage in the transaction because they have the supply and there is a demand. As for a buyer, you will likely experience more competition when writing an offer on a home. As a result, you may want to present your strongest offer initially, in hopes of your offer being the one that’s accepted.
4 – 7: If the absorption rate is between 4 and 7, the market is balanced. This means that neither sellers or buyers have an advantage over the other. If you are selling your home, you will want to price it fairly and keep an open mind when offers come in. If you are buying a home, you should expect to pay what the home is worth and/or be able to negotiate a little more with the seller.
7+ : If the absorption rate is 7+, it is considered a “buyer’s market”. Contrary to a seller’s market, in a buyer’s market there are more homes for sale than there are buyers looking to purchase. This means that a seller may choose to price their home on the lower side if they are looking to sell more quickly, as there is a large inventory of homes for buyers to purchase. A buyer, on the other hand, may have power over the seller to negotiate for what they want in a transaction, if the seller’s home hasn’t received a lot of interest.
If you are looking to buy or sell your home in Montelena or in another area, give us a call for more information. We’d love to help!
We’re looking forward to hearing from you soon!