2006 in Review

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A "Mixed Bag"
2006 was a year filled with lots of changes in our local real estate market. We moved from the really frantic market of the past few years to more sanity. The number of closed sales for 2006 declined over 2005 in all 16 communities surveyed except two, Lafayette and Moraga, where there were slight increases over 2005. The number of homes for sale was up significantly over last year and then inventory began to decline in October through December and into January, 2007. However, current inventory levels are still higher than in January 06. Yet, average closed sale prices continued to increase in 8 of the 16 communities (the range was 9% to .6% over closed prices in 2005). Seven communities showed price declines (the range was from 5% to .5% over closed prices for 2005). See complete sales figures below.

No Crash Yet
The real estate market crash that has been so hyped by the media has yet to materialize. Yes, prices have declined in some areas, but remember again the perspective that we have just gone through years with huge appreciation numbers. But even with that, we are not seeing overall prices plummet. Instead we are seeing a gradual slowing down and reordering of the market to a more normal mode.

For Buyers
There's many more homes to choose from than in recent years, interest rates are still good and sellers are generally more realistic and willing to negotiate. Prices have become more reasonable in a number of communities. A very experienced, knowledgeable agent, is a crucial resource in navigating this kind of market.

For Sellers
There are now many buyers out looking but they are not impressed with homes that are overpriced and/or poorly prepared for sale. Sellers must now be more realistic, be willing to be patient, and expect that negotiations may be more challenging than in the past. This is a time when sellers especially need a very experienced, knowledgeable listing agent with excellent pricing, home sale preparation and negotiation skills.

What the Numbers Mean: Don't read too much into the numbers below. Each community has specific factors that can influence price increase/decrease numbers. (i.e. amount of new construction, inventory, turnover, etc.) The communities where prices increased are not necessarily more desirable to buyers than the communities where prices decreased. There are usually a number of factors that determine final sales prices.

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2006 vs 2005 Closed Sale Prices,

Single Family Detached Homes


Prices Up
Orinda +9%
Diablo +9%
Lafayette +7%
San Ramon +6%
Alamo +5%
Livermore +4%
Danville +.8%
Martinez +.6%

Prices Down
Dublin -5%
Walnut Creek -3%
Clayton -2%
Concord -2%
Pleasant Hill - 1%
Moraga -.7%
Blackhawk -.5%