With an unprecedented number of homes on the market, and 35-year lows on interest rates, many Bay Area residents who were previously shut out of the housing market have an outstanding opportunity to buy in before its expected recovery during the second half of 2002, according to Karl Sopke, president and chief executive officer of SOMA Living Real Estate.
"The number of transactions has been dropping all year long, by comparison to 2000 levels," said Sopke
Conditions could be slightly worse for the tech-heavy Bay Area, said Sopke
said the effects Sept. 11 will not be fully known until late in November.Seventy-five percent of California Realtors said open-house activity fell during the week of Sept. 11, but 66 percent said traffic was back to normal by the following week, according to a CAR survey."Some buyers have postponed purchases, but only by a week or so," Sopke
said."The tragedy of Sept. 11 has not stopped Bay Area home buyers intent on purchasing."
Regardless, the real estate market was slowing well before Sept. 11, Sopke
said."It's clear we've seen an end to the all-time highs and the unparalleled buying frenzy of the dot.com revolution that brought with it significant IPO dollars, multiple offers and frenzied bidding wars."
Clearly, buyers now have choices, a word not associated with the Bay Area real estate market in the past six years."We are settling into a more normal market, after years of overbidding for most properties, particularly at the higher end," said Sopke
The unsold inventory index in the Bay Area -- a measure of the number of months it would take to sell all of the homes on the market at a given time -- nearly doubled in recent months from the same time last year, from 2.3 months of supply to 4 months of supply, according to statistics from CAR
.Inventory of multimillion dollar homes, meanwhile, quadrupled, from a 1.5-month to 4.5-month supply in August-to-August comparisons.
"In many regions, the upper end has all but ground to a halt, as Bay Area buyers no longer are willing to pay inflated prices, and sellers are finding it necessary to be more realistic about listing prices," said Sopke