Wednesday
Jul152015

2015 FIRST HALF ~ RIVIERA REAL ESTATE REPORT

2015 FIRST HALF  ~  RIVIERA REAL ESTATE REPORT

 

After analyzing the first half statistics for the Riviera’s real estate sales my suspicions are confirmed that sometimes perception does not match reality.  The general consensus currently is that the real estate market so far in 2015 has been a continuation of rapid appreciation due to low inventory and strong demand. The reality is that we are on pace to have the largest number of sales in the Riviera and surrounding areas since 2012 and the median price has actually declined by 8% in the last 6 months.

 Generally a declining median price is perceived as a negative factor in the real estate market, however in this case I consider it to be a very positive development.   The market in 2013 & 2014 generated a 21% increase in the median price which was the result of a strong “seller’s market” in which there was not enough supply to satisfy the demand.  On the other end of the spectrum, we experienced a “buyer’s market” between 2009 & 2011 which resulted in a flood of inventory and a 25% decrease in prices.    What we are witnessing now is a balanced market which so far this year has led to a healthy pace of sales and a slight decrease in the median price to $1,575,000.  A closer look at the numbers compared to the first half of 2014 reveals that there was more activity in the mid-range ($1 - $3 mil) and fewer sales at the high end of the market.  This helps to explain why the median price was down even though the pace of sales was quite active.

 My expectation is that the balance of 2015 will reflect what we have seen in the first half.  The level of current inventory is strong and the number of pending sales is at a similar pace to what we have experienced in the first 6 months.  I would also expect the median price to increase a bit, however with a continuation of the balanced market we are experiencing there is very little pressure on prices.  This is that magical time in the real estate cycle when there are advantages for both buyers and sellers—I would encourage those on either side of this fence to reap the benefits.

Tuesday
Jan202015

2014 YEAR IN REVIEW ~ RIVIERA REAL ESTATE REPORT

2014 YEAR IN REVIEW  ~  RIVIERA REAL ESTATE REPORT

 The Riviera real estate market in 2014 experienced a continuation of the steady price appreciation that has been the norm for the past three years.  The final median price for the year was $1,700,000 which represents a 10% increase from 2013 and a 21% increase over the last three years.

 A closer look at the numbers shows an interesting parallel to last year’s market dynamic of strong appreciation in the first half followed by a leveling off in the second half.  In fact, prices increased in both 2013 & 2014 by about 10% in the first half and remained the same for the second half.  The major difference in 2014 was that there was much more activity in the higher price ranges.  There were twice as many sales over $2 million and more than double the amount of sales over $3 million compared to 2013.  Furthermore, the continuing dynamic of low inventory has not changed much in the last two years.  As a result, the number of overall sales is down about 15% from what we witnessed in 2012.

 I expect the trend of moderate appreciation to continue throughout 2015, and I am hopeful that the inventory experiences a more dramatic increase this year which will result in a stronger market overall.  I continue to receive many inquiries from my colleagues who are working with buyers looking for Riviera homes to purchase.  An increase in inventory would help alleviate some of this buyer demand and result in a balanced market between buyers and sellers which we have not witnessed for some time.

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