See Simi Valley Homes For Sale under $300,000
The Simi Valley Real Estate Market is in the middle of a very interesting transition and while the traditional media and my industry tend to create reports that either cheer-lead or sell subscriptions; it would be prudent to really look at what has happened in July and a trend that started back in December of last year.
Sales of Simi Valley Single Family detached housing under $300,000 has been growing in volume. Now, more than any other time since the bottom fell out of the real estate market in 2007, we are seeing prices drop and affordability rise with continued low interest rates. In the Spring of 2009 we saw similar pricing, but investors rushed in and pushed pricing in this segment back up to the low $300,000 range.
What becomes even more interesting this time around is that of the 19 Simi Valley homes that sold under $300,000 in July 2011, 60% were purchased with conventional financing or cash with an average price of $278,000. Cash and conventional purchasers can be attributed to increased activity by investors looking for rental properties and properties in poor condition that could be restored and flipped.
What is causing Volumes to Surge?
1. Prices/affordability 2. Low interest rates.
What is not happening on surging volumes?
Prices are not being run up. Looking at Simi Valley Home Sales for July 2011 we can see that 84% of all sales were under $500,000 and that the top end over $900,000 had no sales for the month. Sluggish sales over $500,000 contributes to the lower average sale price.
Tracking the average sale price does not necessarily mean that Simi Valley Home Owners have lost $57,000 in value, what it does indicate, is when you compare the average sale price each month over the course of time you can spot trends over the whole spectrum of price ranges, any major shifts between months as we are seeing between June (Simi Valley June Market Report) and July, helps us to look close at what is selling, who is buying and what are the conditions that are driving these sales.
Real Estate Markets are local, traditional media tends to report regional and statewide Real Estate trends, which you can see don’t amount to much when we look at the activity for Simi Valley.
The local, State and Federal economic issues, $4.00 a gallon gasoline, employment opportunities have a huge influence on home buyers. Additionally, the Foreclosure market, Short Sale Market and Loan Modification Market are still in the middle of their mountain of problems.
What is becoming clear from my experience with buyers in my car and looking at the trending data; buyers are very interested when pricing and condition are right, but they are unwilling to jack up the pricing (above market value) in bidding wars.
While this all may sound horrific to home sellers, this is all part or a greater stability that is forming. Increasing volumes on lower prices is positive, what we don’t want to see is decreasing volumes and lower prices.
[…] Simi Valley July 2011 Home Sales Surge on Volume Average Sale Price drops $57k […]