Venice, Calif., is No. 3 on Forbes' list of the five suburbs with the best conditions for sellers./Photo © Sebastien Burel/Shutterstock/Forbes
Berkeley, Calif., a town known for years as a hippie haven, is becoming a hotbed for home sales. Prices in the San Francisco Bay Area suburb are up 9% this year, with homes selling for a median price of $790,986. Properties are sitting on the market for 73 days on average, the lowest of any area with positive price trends within the country's 75 largest Census-defined metro areas. Only 37% of sellers have been forced to reduce their prices, one of the lowest rates in the country.
In fact, the only housing-market problem Berkeley seems to have involved a foreclosure of sorts on four protesters who illegally occupied a tree from the beginning of the year through September. Authorities finally cut off the protesters' food and water supply, forcing them from their oak home.
It may not be a boom, but given regional problems, it's a good market to be in.
Berkeley joins Venice, Calif.; Bedford, Texas; Kennesaw, Ga.; and Sugar Land, Texas, on Forbes’ list of the five suburbs with the best conditions for sellers. Home prices in three of the five — Berkeley, Venice and Bedford — actually have risen over the past year, while prices in Kennesaw have stayed level.
"It's a measure of how rough is it out there for sellers,” says Michael Simonsen, chief executive of Altos Research. “These are the best markets, and we're looking at three to four months of time to sell in the country's best markets."
Behind the numbers
Forbes’ data come from Altos Research, a Mountain View, Calif., research firm. Forbes looked at the suburbs in the country's 75 largest Census-defined metro areas based on a recent 90 days of sales activity. Since a metro area can contain hundreds of suburbs, the search was narrowed to those suburbs with an inventory of at least 75 homes on the market.
Since stagnation is the death of prices and sales, Forbes further eliminated suburbs where it currently takes more than 125 days to sell the average home. Price also matters. Nationwide, cities such as Sacramento, Calif., and Los Angeles are among the easiest to sell a home, based on sales data from Radar Logic, a New York real estate research firm, but many homes there are selling at massive discounts. To eliminate these places from the list, Forbes excised any suburb where year-over-year price declines were steeper than 10% and where more than 50% of sellers had to reduce their asking price to sell their home.
It’s tough out there
What was left wasn't a set of awe-inspiring hidden gems where sellers are awash in bidding wars. Nationwide, low interest rates and low prices caused existing home sales to rise 5.5% in September, but in many areas of the country, sellers are finding relatively few buyers.
Indeed, areas such as Encinitas, Calif., and Matthews, N.C., where homes are staying on the market for 100 and 127 days, respectively, made the top 10 on Forbes’ list even though such long waiting times are traditionally hallmarks of a buyers’ market.
Sellers in Waltham, Mass., a middle-class suburb west of Boston, don't have that problem. They've seen 1% price appreciation over the last year, and only 53% of them have had to reduce their price in order to make a sale. It's not exactly a bull market, but homes in Waltham take only 79 days to find buyers, the second-quickest turnaround of any suburb on Forbes’ list.
In Montclair, N.J., however, 27% of sellers had dropped their prices in the previous 90 days. The median home price there is $671,954, and properties stay on the market 115 days.
While this is good news for local homeowners, these are hardly sellers’ markets.
"In some markets you can drop the price to zero and not sell a brand-new property," says Doug Duncan, the chief economist of lending giant Fannie Mae.
Why? "There's no one there to buy it."
5 best suburbs to sell a home
1. Berkeley, Calif.
Click here to see the complete list of best suburbs to sell a home.
By Matt Woolsey, Forbes.com
