For the last several years, sellers on the West Coast were sipping exotic drinks on their lounge chairs waiting for buyers to bid up the price of their homes. Guess what? The only constant is change.
During these last few months, West Coast bidding wars have become West Coast pricing cuts. Rather than taking days to sell, houses on the West Coast are taking weeks, months and, occasionally, years to sell. (Case in point, it took a +$3M price cut and well over a year to sell Warren Buffett’s vacation home in Laguna Beach.)
September sales have fallen so dramatically on the West Coast that buyers are regaining at least an equal if not upper hand. Affordability constraints are simply dragging down the market. Take a look:
- Seattle sales down -24%
- San Jose sales down -16%
- Los Angeles sales down -16%
- San Diego sales down -13%
Simultaneously, inventory spikes in used-to-be hottest markets are happening at eye-popping rates. These spikes are the biggest inventory jumps in the last 5 years.
- San Jose supply +113.1%
- Denver supply +81.9%
- Seattle supply +47.2%
- San Francisco supply +33%
- San Diego supply +34.1%
- Los Angeles supply +12%
19 of the 30 markets with the highest spikes in active listings in September were in four states…California, Oregon, Colorado and Washington.
In Southern California, year over year price appreciation began to decline in Spring 2018. That decline has continued into the Fall and soon to be Winter. Declining price appreciation in Northern California took a bit longer but in September, both San Jose and San Francisco registered appreciation decreases.
September 2018 Data for West Coast Markets
City Y/Y Listings Y/Y Sales Volume Y/Y Rate of Appreciation
San Jose +113.1% -16.4% -5.5
Vallejo +96.3% -15.4% -5.7
Santa Rosa +90.2% -25.8%** -1.8
Denver +81.9% +1.1% -2.7
Napa +48.9% -3.2% +8.3
Seattle +47.2% -24.7%** -4
San Diego +34.1% -13.1% -1.8
San Francisco +33.0% -6.9% -1.1
Santa Cruz +22.7% -17.2% +8.8
Portland +21.4% -10.5% +0.3
Greeley +19.9% +4.8% -13.8
Fresno +17.8% -15.1% -10.4
Sacramento +15.2% -13.0% +0.2
Orange Co. +15.1% -10.3% -1.3
Chico +114.2% -5.4% -26.1**
Oxnard +13.4% -6.7% -10.5
Boulder +13.2% +4.1% -7.5
Los Angeles +12.7% -16.8% -5.1
Reno +12.2% -22.4%** +5.6
Merced +11.8% -12.8% -11.4
