Are sellers negotiating in the $250-650k price range?

I had a client ask me this today, and I figured I'd share the response with my other clients and viewers:

"As far as prices are considered and flexibility through negotiation, the price range you are looking in is by far where we have been and are still seeing the most activity. Low inventory levels and high buyer demand for that price range are making negotiation options limited. Sample scenario: 3/2 tract home in Goleta, REO for $500-550k, probably a 75% chance it will sell within 72 hours with multiple offers and at least asking price, if not more. Best case scenario if you want movement on the price through negotiation is to find a property that has been on the market for a while (like Juana Maria) and then negotiation can really come into play. For the few REO's that stay on the market longer that 2-3 weeks, the banks will move some on their prices, but best case scenario is often to negotiate less aggressively (ask for less of a discount) and they are more likely to just accept offer, rather than counter back and forth. With traditional sellers I am a strong advocate of firmer negotiation and countering back and forth to really get the best deal, that strategy just doesn't seem to work as well with the REO's. They want good clean offers, strong financial qualifications, buyers who will take property "As-is" and not ask for repairs, and shorter escrows. We can talk more about this if we find you a property you'd like to move forward on. Each negotiation is case specific so I can only give you general answers at this point.

If any of you want to discuss this further, feel free to give me a call at 805-637-7148.

Santa Barbara Market--Best time to buy?

Here is a quick market update:

Santa Barbara real estate is not like the other markets in California. We aren't seeing prices softening any more, but holding stable at a nice low bottom end. We are seeing quite a few multiple offer scenarios, both REO and non REO, more so than any other part of California that I know. All signs put to the next 6-12 month window as the best time to buy. If prices to continue to soften, it won't be more that 5-7% scenario best (or worst depending on how you look at it) case scenario. If interest rates go up, that will more than offset any potential advantage of waiting.