A few days ago the Marin Independent Journal posted an article about home sales for the month of September – highlighting an increase in median home and condo prices. This is not a surprise given the activity in the market typically slows down every July and August. September through the end of November is when we normally see an increase in sales activity. It’s almost the last opportunity to sell a home prior to the end of the year. Once the holidays start rolling in sellers start taking their homes off the market and buyers are distracted with holiday festivities
A one month rise in home values should not be considered a trend. What is really happening in the market place? Coming into the typical cycle of Fall, buyer’s jumpstart their home search, interest rates are at all time lows, Marin’s unemployment rate is the lowest in the state and prices for homes have come down in all categories. We’re seeing more inventory in the $1M+ range that is selling therefore raising the median home price to $765,000. Single family residence sales are contributing the most to these figures and there are still great deals to be had.
The condominium sales are included in the median sales price above. If you just analyze the numbers for the condominiums, you can see there is definitely a trend downwards – in volume and median sales price from a year ago. Why? Many condominium buyers are first time home buyers. What I am seeing right now is that it is typical that first time home buyers entering the market in Marin under $600,000 do not have the conventional 10-20% down payment for their purchase. The other option for these buyers is to qualify for a Federal Housing Authority (FHA) home loan which allows the buyer to put down as little as 3.5% down on a home. When it comes to purchasing a condominium the Home Owners Associations must meet FHA lender guidelines and be approved by the FHA lender in order for the purchase to commence. Compared to the number of condominium developments in Marin, there are only a handful of developments that qualify for FHA financing. If you want to know which ones qualify, go to HUD’s web site.
Currently I think the opportunity in the Marin condominium market is for buyers with a solid down-payment that want a great home with low maintenance, empty nesters wanting to downsize and investors looking for good income property at a great price.