June 27th, 2020
Does the real estate market behave differently for different Palos Verdes Homes price ranges?
I had a client ask me this morning if the market behaves pretty much the same way depending on price ranges. I think intuitively we can guess that it does. But is there an objective way we can measure how the market behaves for differing price ranges?
As it turns out, there is! One of the measures I use to help guide my clients, whether they’re buying, selling or both, is to analyze what I call the “unsold inventory index”. What this is index does is to take the rate, the pace if you will or the velocity of pending sales, and applies that rate to the existing levels of active listings. That gets us a number of how many months it would take to sell existing supplies without any new listings coming to the market.
Let’s take a look at the Palos Verdes Peninsula. Don’t fret, if you’re in Manhattan Beach, Redondo Beach, Hermosa Beach, Torrance etc, I can do this same analysis for you.
Oh, first, let me go over the obvious. We want to study the trend, not just the static numbers so if the trend is down, that tells us the market is improving, so if you’re considering to sell your home, and you’re studying a probable price range within which your home is likely to sell, having a downward trending unsold inventory index allows you to
a)price your home in the lower part of the range
b)price your home in the middle of the range
c)or price your home in the upper part of the range
What would you do? Leave me a comment (bottom of this page) and let’s discuss it. Conversely if you’re a buyer and you see that the same trend, what would that suggest to you in terms of how you position your offer price?
What price range do you believe your home to be in? Contact me and I will prepare a customized chart like this one for your home. This chart shows the market’s ability to absorb inventory for Palos Verdes homes price ranges of $1,000,000 – 1,199,999
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