If your Pasadena home search has been somewhat frustrating trying to find that nice 3 bed, 2 bath traditional for under $600,000, you may want to take a second look at the condo and townhome market. These two markets although similar in

The sales cycle has been harder to predict than in Single Family homes

nature are also marked by sharp contrasts. According to the Pasadena home search, there are about 230 condominium properties for sale in the city. What is not being reported is all of the recent new construction properties that are for sale, but are not listed in the MLS.

There is a very good reason for this. The developers do not want you to see how many of these units are currently unsold. If you knew you might be more aggressive on your offering price. Many of these new units now for sale were being purchased and planned several years ago when the market was red hot and appeared there was no end in sight. The other misfortune assumed that Pasadena had a voracious appetite for high end units. With most of this development happening in the downtown and in the high retail areas, land was selling at a premium. The assumption was people would pay more to live in areas with so many walkable amenities.

Current Market Conditions

These two graphs present different stories. The reason being the top chart is based on actual closed sales and the bottom is based on what is currently “for sale”. The median price of units sold in the last couple of

Increasing Inventory Means Lower Prices

months have ranged form $425.0 to $450.0. Whereas the bottom chart indicated that the median price has fallen about $45,000 since January 1, 2010 and currently resides around $500.0. On the flip side inventory has also increased around 10% from the first of the year also.
So what does this mean?
What this really indicates is some softness in the upper end condo market. It could also be evidence of trade up buyers opting for single family homes as opposed to a different lifestyle associated with communal living.

Price Direction

Unlike the current activity in the Single Family market, we don’t see multiple bids on condos and townhomes, nor do we see evidence of closing prices above current asking prices. Home sellers in this category are going to have to remain negotiable for the foreseeable future and developers may resort to interest rate buy downs in lieu of reduced prices.