A smattering of homes in the past month have sold for $10,000 or more above the asking price.
Is it a sign of a pending price recovery in Manteca?
In every instance the homes were fairly typical, in good shape and were under priced although not on purpose.
So why is that happening? Is it a deliberate marketing strategy? In short, the answer to that question is no.
Homes in today’s market that are deliberately underpriced are those placed on the market by non-distressed owners who need to grab attention because they want to make a relatively quick sale.
The four homes in question - according to long-time Realtors - were under priced because the banks holding the foreclosed homes have no inkling about the local market as they have no one “on the ground” making final pricing decisions but instead leave it up to repossession operations in New York, Los Angeles or even Bonn, Germany.
As a result, they look at regional numbers that are available such as the Stockton-Modesto market which happens - on average to be $10,000 to $15,000 lower than Manteca. And even if the foreclosed home was in immaculate shape, had every amenity in the free world, is located in the most desirable neighborhood in town, many banks today are more driven by square footage. Age doesn’t even make a difference many times.
All four homes ended up selling for what several Realtors believe is the true market value.
Even so, this is good news - to a degree.
Manteca continues to hold a stronger value than Stockton or Modesto. And once a look at the trends of all segments in the housing market - the two bedroom one bathroom homes to the most popular three and four bedroom with two or more bathroom floor plans all the way up to McMansions - are taken into account, the signs all point to the market definitely being at the bottom.
Actually, some would argue - and probably rightfully so, Manteca has been at the bottom of the market for the lower and middle segments since early 2010. That’s because when you take out the larger, new homes that sell in excess of $220,000 the median price has been pretty consistent only fluctuating by several thousand dollars over the course of the past 14 months.
That’s because median accounts for all home sales. Just like when the market was super hot in terms of pricing, the extreme end can skew the median, it is also case when prices aren’t red hot. A $690,000 McMansion resale against a $300,000 older basic tract home in 2005 would have produced a median selling price of $445,000.
Today a $140,000 basic tract home against one of the McMansions that have deflated significantly in price to $340,000 would produce a mean price of $190,000.
Back when the market was sizzling McMansions were selling like hot cakes. Now it is the smaller and more affordable homes driving the market.