How Can You Tell If (and When) The Real Estate Market has Hit the Bottom?

How Can You Tell If (and When) The Real Estate Market has Hit the Bottom?
By Michelle C. Carr-Crowe, ABR, ALHS, ASP, PME, RECS, SRES


“I don’t want to buy when the market is still going down”…
“I want to wait and see if prices go down further before buying” …
“After the market hits bottom, then I’ll buy” …

Buyers tell me things like this every day. But how can you tell if (and when) the market has hit the bottom?

(Hint: You won’t like the answer.)

You can tell the market has hit bottom…only when it starts going back up.

Then a large number of Buyers miss the market – commonly by about six months – because of three things: they’re stuck in the waiting mode and fail to act quickly enough; they see it trend upwards and wait because they believe it will quickly come back down again; or after waiting too long, desperately chase the price back up before the properties they desire become financially out of reach…again.

Most people know Michelle C. Carr-Crowe and the Get RE$ult$ Team as the Lynbrook and Cupertino Area Schools Experts – I and my team specialize in that area, which overall has held amazingly steady values as compared to the rest of Santa Clara County, the Bay Area, California and the rest of the United States.

However, real estate is a people business and I consider myself a real estate consultant—someone who invests the time in learning what people need and want, educating them about the market and the process, and puts their needs before my own. As such, I help people in other parts of San Jose, Cupertino, Saratoga and Palo Alto—including foreclosures, pre-foreclosures, bank-owned properties and short sales.

For example, I have a short sale in Alum Rock – an appealing two-bedroom fixer-upper on a 6500-sf lot – located at 136 N. White Road (if you don’t know the area, it’s a busy, high-traffic street), right across the street from Pala Middle School and James Lick High School, two of the academically lowest-performing schools in the Bay Area.

The listing was a referral and the original asking price in November, 2008 was $350,000. Although we received about three weeks worth of initial interest, we had no serious interest or even showings until the professional negotiator came back with a pre-approved price of $208,000, and authorization to list it somewhere between $208,000 and $250,000.

I now receive multiple calls and showings daily on this property. Within one week, I had three competitive offers in hand. I’ve received three more offers – two of them this afternoon.

ALL of the offers are at, and in some cases, significantly above the $208,000 price.

ALL are pre-approved buyers with at least 20 percent down; at least one is all cash.

ALL are willing to deal with the lengthy and sometimes frustrating short sale process.

HALF of them have already written they are open to negotiating UPWARDS in price to get the home.

Does that sound like a declining market to you?

Certainly, the new price was more attractive. However, IF the market was truly still down and/or declining, we might have received new or renewed interest and showings, but few or no offers. If it was still down or declining, any offering prices would likely be BELOW the pre-approved price or at most, AT the pre-approved price, based on human nature, normal behavior in a true buyer’s market, and my 22 years of experience as a licensed REALTOR®.

As a former freelance journalist, (a notably cynical group), my natural instinct is to research and examine the facts and data to see the big picture before drawing any conclusions.

And in my opinion, what that data shows is a fascinating snapshot of a market in transition.

Back when I first took the listing, and throughout most of the listing period, there were, on average, 200 to 250 3 bedroom single family homes for sale in all areas of Santa Clara County.

Today, there are only 147.

Even more fascinating is this: In the past 26 days, 140 of those properties changed status from for sale to either pending or sold; and of those 140, 33 (or 23 percent, nearly a quarter of them) became closed sales.

The total number of homes available has decreased to a nearly balanced point in this group: 147 actively for sale now and 140 that changed into pending and/or sold in less than a 30-day period. When the number of homes going out of the market are nearly equal to the number of homes coming in, the market is in balance. That doesn’t mean every home on the market will sell in the next 30 days. It doesn’t mean some of the more difficult to move properties – such as one-bedroom condos, two-bedroom bungalows (like my listing), properties on busy streets or those with extensive damage – will all sell, and sell quickly for more than asking price.

But when a 63-year-old fixer upper on a busy street in Alum Rock goes from being nearly ignored for 100 days on the market to receiving six solid offers in less than 10 days, it shows that when properties are right-priced for their unique features and market, there are excellent, qualified buyers ready to take advantage of the opportunity—and willing to even increase the price to guarantee getting that particular home. As the bottom of the market felt the downward trend first, it only makes sense it will also feel the stabilizing trend first, as well as the upward trend first.

If it was just my opinion, that would be one thing. If it was only a balanced amount of homes in and out, that would be another single factor. If it was just that many of the homes selling were selling at or near asking price, that would be one more single factor.

But for the Buyers who keep asking, don’t say I didn’t tell you.


Michelle C. Carr-Crowe is a full-time real estate consultant and the leader of the Get RE$ult$ Team based in the Silicon Valley Bay Area. A licensee for over 20 years (DRE #00901962), Michelle and her team specialize in helping people buy, sell & invest in homes and properties in the San Jose Lynbrook, Cupertino, Saratoga & Palo Alto School Districts throughout Santa Clara County. She can be reached at 408.252.8900, info@lynbrookhighhomes.com or http://www.michellejudycarr.com/.


Interested in learning more about short sale opportunities in your area? Just send an email with your information, the area you’re interested in, specifics about the type of property you like, your timeline, and your contact information to shortsale@michellejudycarr.com. To see a list of current short sale properties in popular Cupertino, San Jose and Saratoga areas with Top Cupertino and Saratoga Schools, visit our Short Sale pages.

Just Call ... (408)252.8900 Michelle C. Carr-Crowe and the Get RE$ult$ Team, Your Lynbrook, Cupertino & Saratoga Schools Experts & Your Family's Real Estate Consultants for Lifefor more information and showings of these and other short sale, pre-foreclosure, foreclosure, bank-owned and traditional home opportunities.