As I am reviewing some sold homes that earned multiple offers, selling over the asking price; I saw a common thread – really cool outdoor space! Indoor-outdoor flow is a vital part of California living and a special backyard can make a small house feel bigger. For the property below that I listed last year in Rockridge, I spent some time browsing on Houzz and Pintrest to see what I liked. I then shared my likes with my clients and we came up with this.
This is the backyard at 406 61st Street in Rockridge before we placed it on the market. My clients had always wanted to renovate the space, but after an extensive interior renovation, they put the outdoor space on hold.
Here is the outdoor “room” after the addition of flagstone, raised veggie beds, drought tolerant perennials and eco-lawn, and an irrigation system.
A view from the opposite direction. Within one month the raised beds were completely packed with cabbages, fresh herbs and lettuces.
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I am currently trying to find several buyers homes. The challenge is that new listing inventory is down by 12%, so there is heavy competition. Buyers are frustrated: few homes are available, and determining the appropriate offer price is particularly challenging.
When trying to determine the right offer price with few sales, looking at comparable data often won’t cut it as our inventory is unique and sold data captures history, not the future, of value. This means that you have to analyze the market condition, the property condition, how much you love a home and the level of interest among other parties.
I strongly discourage buyers to write offers when they have a very low chance of being the winning bid. The first thing to understand as a buyer is listing price often has no correlation to real value. A seller can price a home at $1 to create an auction-like frenzy. In fact, the more offers a seller receives, the higher their price may go.
How does that affect you? When the next homeowner prices their property, the comps and competitive market dynamics will lead to a higher price. You have just contributed to a market increase.
Last year I had several clients who did not want to adjust their search parameters to better meet their budget. They felt there was a chance (although slim) they could find that rare property that fit all of their requirements . That rare property didn’t show up, prices continued to increase, and they were priced out of the market.
The bottom line is the Oakland and Berkeley marketplace is very unique, no two homes are alike. Don’t buy something that you do not want, but be sure to balance market realities with your expectations. See the chart below regarding the current inventory.
This chart illustrates what many buyers feel
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