Below is an informative graph for sellers, as those with equity can price aggressively to try to sell. 66% of all buyers in this area in 2010 were "First Timers," up nearly 10% over 2009, when the Homebuyer Tax Cred was also in force (report). This tells sellers that many buyers are relying on cash they don't have to purchase a home.
In terms of inventory, the single family home numbers remain up in the City (and will jump in the Spring) and it's technically a "buyer's market." Many buyers, however, aren't attracted by the prices, often finding brand-new, or much larger, homes for (much) less in the surrounding counties.
Knowing that prices are likely to decline through 2013, buyers must plan to stay put for 7-10 years. (There's always that question: What if you have to sell, and there's no greater fool?) Sellers with equity are, in most cases, those who bought pre-2004 (many others aren't so fortunate).
Notes on the graph:
- When the homebuyer tax credit expired on April 30, sales in the second half of 2010 in this area dropped precipitously (read).
- 2010 single family home sales are -10% lower than in 2001.
- 2010 single family home sales were -43% lower than in 2004, the peak for this sector (more condos and townhouses were being built/purchased in the middle of the decade, and prices were zooming upward, so single family home sales declined after 2004 in the City).
- 2010 single family home sales were -13% lower than in 2009 (ie, during Recession and even with tax cred available).
- 2009 single family home sales were -15% lower than in 2008 (even with tax cred available)).