Let’s start with a look back over the previous year in North Berkeley real estate, and then take a quick look forward.
Over the course of 2019, there were 89 active listings in North Berkeley, and 81 properties sold. Both of these numbers are down from the previous year, when we had 101 active listings, and 92 sales. Low inventory meant that there were multiple buyers interested in most properties, and 81% of the sales were for more than list price. Sale price averaged 26% above list price for those properties that went over.
The median sale price for 2019 was $1,350,000 in North Berkeley, which is up 2% from the previous year. The average sold price per square foot was up 4% from the previous year at $874.
Most properties sold quickly, in an average of 21 days on the market. Twelve properties (15% of the total) did need to adjust their prices before selling—8 properties had price reductions, and 4 properties had price increases. Remember that in our market, a price change in either direction is generally a signal that a property did not get the initial interest that was expected. In 2018, 9 properties had price changes, or 10% of the total sales.
All of these numbers feel consistent with where we seem to be in the real estate market cycle. I think we’re right around the peak, so we’re seeing relatively modest price increases and a few more properties not doing as well as expected.
For the winter quarter just past (December through February), there were only 15 active listings, and 10 sales. 2 properties had price changes, and the median sold price was $1,387,500, up 4% from the fall quarter. The average sold price per square foot was $830 for the winter, which is down 2% from the fall, but up 5% from the previous winter.
So far in 2020, the buyers have been out in droves, looking at the very few houses on the market. Will the coronavirus slow things down going forward? Low interest rates will help, but uncertainty about the economy, and a focus on staying home rather than going to public gatherings (like open houses) could affect buyers’ plans. We’ll have to wait and see how it all develops.
UPDATE, March 20, 2020
Well, since I wrote the post above, things have definitely changed. We now have a statewide Shelter-In-Place order, which has slowed (but surprisingly, not stopped) activity in the real estate market. Open houses are canceled, but there are still properties on the market, being shown, and sold, with photos and virtual tours. I’ve been surprised at how many offers properties have been getting under these extraordinary and difficult circumstances.
Also of note: while the Fed has cut interest rates multiple times, and the interest rate on 10-year Treasury notes (which is typically the rate most tied to rates on home loans) has fallen substantially since the beginning of the year, home loan rates have actually risen. Lenders reportedly were already struggling to keep up with refinance requests, and these difficulties cannot have been helped by the Shelter-in-Place.