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Real Estate - October 26, 2007

Alamo Real Estate: Third Quarter Review

If you have been watching television or reading the big time newspapers, you are probably wondering if your home is worth what you paid for it. Unfortunately, the doom and gloomers are reporting on a national real estate market that isn't particularly relevant to any local market, let alone ours. Unlike candy bars and computers, the Real Estate market is local in nature and what is happening in Dayton, Ohio, has no bearing on the value of your home in Alamo. You just can't buy a Dayton home on the Internet and have it shipped to Alamo or vice versa.

Let's take a look at single family home sales in Alamo and see how things are shaping up through the end of the third quarter. Surprise! Surprise! Surprise! More Alamo single family detached homes have sold in 2007 than sold in the same time period in 2006 (Jan. 1-Sept. 30). I bet you don't hear about that on the nightly news (not a surprise). In 2006 a total of 121 homes sold while in 2007 a total of 143 homes have sold. That's an 18 percent increase in unit sales year on year. Average sold price in '06 was $1,775,114, and in '07 it was $1,730,719. That's roughly a 2.5 percent drop in average price. Average price paid per square foot also dipped slightly (-2 percent) from $524 in '06 to $515 in '07. A market adjustment perhaps, hardly a meltdown! The price of oil varies more than this on a monthly basis, so it just doesn't seem to be quite as bad as the folks in the media want us to believe. Prices in the Alamo market have risen more than 50 percent during the past five years, so a 2.5 percent give back seems pretty small in comparison. If you bought a new car last year, it's probably worth 25-30 percent less than you paid for it.

During the first quarter of '07 a total of 49 homes sold in Alamo, compared to 54 in 2006 for a 10 percent decrease in unit sales. They sold on average at a square foot price of $497 in '07 compared to $532 per square foot during Q1 of '06 or about 7 percent cheaper on a square foot basis. Admittedly, these numbers at the beginning of the year don't look so hot, but as the year progresses some changes begin to occur. So read on!

During the second quarter of '07 unit sales were 42, significantly more (23.5 percent) than the 34 reported in '06. Interesting, price paid per square foot in Q2, 2006 was $531 while in the second quarter of 2007 it was lower by roughly -1 percent at $526 which was actually $2 per square foot higher than was paid in Q1 '06 and $11 dollars more than was paid in the first quarter of '07. Go figure!

During the third quarter of '07 a total of 52 sales were reported in Alamo. This compares to just 33 sales in the first quarter of 2006. That's a whopping 57.5 percent increase in unit sales quarter on quarter. Average price paid per square foot works out to be $1 less in 2007 at $522 a square foot, however, average purchase price increased from $1,757,530 to $1,829,666. Hold the phone! That's a 10.4 percent increase in average price paid over the previous year. Median price for the quarter also increased from $1,499,000 to $1,575,000 for a 5 percent increase in median price. Could this represent an increase in confidence, a market bottom or an inexplicable anomaly? Only time will tell.

At the time of this writing there are 103 homes in Alamo listed as Active or Pending sale. Ten of the 103 homes are listed as pending. Average list price for the 93 Actives is $1,997,251 while the average list price for the 10 Pending sale is $1,506,700. That's a huge spread of 32 percent. On average, 16 Alamo homes have sold per month in 2007 which means the market is carrying 5.8 months worth of inventory. It will be interesting to see how the fourth quarter plays out, so you won't want to miss a single column.

To receive a copy of our annual Alamo Market Review including the complete detail, please send an e-mail to joecombs@thecombsteam.com and place Alamo Market Review in the subject line. No e-mail, no worries; call me to arrange delivery, 989-6086.

Data presented in this column is based in whole or in part on data supplied by the Contra Costa and Alameda MLS service and other quoted sources. Joe and Nancy Combs, Remax and the MLS service do not guarantee the accuracy of this information.

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