Opportunities for Bay Area Homebuyers in Q4 2024

As we go deeper into the final quarter of 2024, the Bay Area real estate market is offering significant opportunities for homebuyers—especially those ready to act decisively and negotiate aggressively. With an increasing number of properties sitting on the market for extended periods, buyers are in a strong position to secure great deals, particularly in higher price ranges. Here’s an in-depth look at the current market dynamics and how buyers can capitalize on these trends.

A Surge in Listings with High Days on Market (DOM)

As of Q4 2024, the Bay Area market is experiencing a significant amount of listing inventory with long days on market (DOM). Over 6,300 active listings, about 60% of the total inventory, have been on the market for more than 30 days. Here’s how the numbers break down:

3,750 listings (35%) have been active for over 60 days.
2,500 listings (24%) have been on the market for more than 90 days.
800 listings have been sitting for over six months!

In the luxury market, the situation is even more striking:

36% of homes priced between $5 million and $9.99 million have been on the market for more than four months.
56% of homes priced at $10 million and above have been listed for over four months, and 37% of these high-end properties have cumulative DOM exceeding six months.

For savvy homebuyers, these statistics highlight a significant opportunity: properties with longer DOM often represent overpricing rather than inherent issues with the home itself. This creates a prime window for buyers to negotiate more favorable terms and prices.

Why This is a Great Time to Buy

The market is currently ripe for buyers who are ready to be bold and make aggressive offers. In many cases, the reason these homes have languished on the market for so long boils down to one factor: pricing. Sellers who initially set their asking prices too high are now facing the reality of long days on market and reduced interest.

For buyers, this presents a golden opportunity. Homes with high DOM may not be attracting the attention they once did, but that doesn’t mean they aren’t high-quality properties. In fact, some of the most desirable homes are sitting unsold simply due to overpricing, not because of any flaws in the home itself.

Buyers should take this chance to make offers at prices that work for them—sometimes well below the original asking price. The key strategy here is to ignore the list price and make offers based on what you’re willing to pay. While it might seem daunting to throw in a low-ball offer, in this current market climate, those offers are more likely to be accepted or spark negotiation than ever before.

Negotiation Leverage for Buyers

With so many homes sitting unsold, sellers may be more motivated to close a deal than they initially let on. This is especially true for properties with a DOM exceeding 60 days or longer. Many sellers are beginning to realize that if they truly want to sell in 2024, they’ll need to become more flexible on pricing.

For buyers, this is where the real opportunity lies. By offering a price that works for you, even if it’s far below the list price, you can set the stage for serious negotiations. Some sellers will of course flat-out reject a low offer, but many will open the door for discussion.

Sellers who are committed to selling are more likely to entertain offers they might have previously dismissed, especially if their home has been sitting on the market for months. With fewer buyers actively making offers, the negotiating table is tipped in favor of those who are ready to act.

Tips for Buyers to Maximize Their Opportunities

To capitalize on the current market conditions, buyers should keep a few broad strategies in mind:

Look Beyond the List Price: If a property has been on the market for a long time, the list price is likely no longer relevant. Instead, focus on what the home is worth to you and what you’re willing to pay.
Make Low Offers: Don’t be afraid to submit an offer that’s lower than the asking price. In the current market, many sellers are more willing to negotiate than they were at the start of their listing.
Be Persistent: Some offers may get rejected, but persistence can pay off. Keep an eye on listings that have been on the market for a long time and re-submit offers or negotiate if they continue to sit unsold.
Work with an Experienced Agent: Partnering with a real estate agent who understands the dynamics of the Bay Area market can give you an edge. Agents with local expertise can help you identify homes with high DOM that are ripe for negotiation and assist in crafting winning offers.

Negotiating and Making Sweet Deals in a Shifting Market

When the real estate market begins to shift, the dynamics of negotiation evolve with it. Buyers should adapt their negotiation strategy to secure the best possible deal. Below are key strategies to keep in mind to make deals in a changing market, particularly as we navigate the current conditions in the Bay Area.

1. Don’t Hesitate to Offer Below Asking Price

If you’re a buyer who’s been trying all year to get into a house, now is the time! Don’t shy away from submitting offers below asking price—even significantly below. You might worry about offending the listing agent or seller, but in today’s market, many sellers are more motivated than they let on. Skip asking the listing agent if the seller will consider a lower offer; instead, just go for it. The worst that can happen is they say no, and you’re no worse off than before.

2. Don’t Assume You Know What the Other Party Will Accept

One of the biggest mistakes in negotiation is making assumptions about what the other party will or won’t accept. The truth is, no one really knows—sometimes, not even the buyer or seller themselves know until they’re faced with a decision. So don’t preemptively eliminate opportunities based on assumptions. A deal could be one signature away from closing, and the other party might surprise you with what they’re willing to concede.

3. Back Up Offers with Market Data

When submitting an offer, particularly one below the asking price, it can be powerful to include relevant market data. Point to recent sales, price reductions, expired listings, or trends that support your buyer’s position. Sometimes, the information you’re providing might echo what the seller is already hearing from their own agent, reinforcing your argument and creating a stronger case for negotiation.

4. Always Counteroffer

When faced with an offer that isn’t immediately acceptable, make a counter offer, even if it seems pointless. Even if the counteroffer is for a small concession, keeping the conversation going leaves the door open for a potential deal. The key here is to avoid letting the negotiation stall prematurely. As long as both sides are still talking, there’s a chance to close the gap and reach an agreement.

5. Check Your Ego at the Door

Negotiation is not the place for big egos. A lack of courtesy or professionalism can kill deals that would have otherwise gone through. Whether you’re dealing with agents or principals, showing respect and keeping the lines of communication open is crucial. A courteous approach builds trust and keeps the negotiation moving forward.

6. Compromise is Key

People tend to respond positively to compromises that seem fair. One common approach is to “split the difference” between two positions, even if there’s nothing inherently fair about it. The perception of fairness can often encourage the other party to make the final concession needed to seal the deal.

7. Time as a Negotiation Tool

Time can be used to your advantage in negotiations. Sometimes, speeding up the process with a short expiration on an offer can put pressure on the other party to make a decision. On the flip side, slowing things down can also work in your favor by allowing for the other side to reconsider their position. If you make an offer and aren’t able to put a deal together within a few days, you may find that in another few weeks the seller will have softened their position and you can make a better deal.

11. Keep the Conversation Going

A negotiation isn’t over until the ink is dry on the contract. Don’t give up too early. Even if the initial round of negotiations doesn’t result in a deal, keep strategizing with your client and stay in touch with the other side. Sometimes, the other party’s position will shift after some time has passed, creating new opportunities to get the deal done.

12. Every Deal is Unique

Remember that no two deals are exactly alike. Every negotiation brings with it different parties, circumstances, and market conditions. There’s no one-size-fits-all approach. Each strategy carries its own set of risks and rewards, and it’s essential to tailor your tactics to the situation at hand. Ultimately, the client is the decision-maker, but your role is to guide them with smart, adaptable strategies that reflect the realities of the current market.

Negotiating in a changing market requires flexibility, persistence, and a willingness to explore different avenues. Whether you’re working with buyers or sellers, following these strategies can help you secure the best possible deal for your clients. Remember, the market may change, but the fundamentals of strong negotiation remain the same: stay courteous, keep the conversation going, and always be willing to adapt your approach to the situation at hand.

The Window of Opportunity

For both buyers and sellers, the next two months represent a pivotal moment in the Bay Area real estate market. Buyers can take advantage of long-DOM listings to negotiate more favorable deals, while sellers must decide whether to adjust their strategy or wait for potential changes in 2025.

The bottom line is this: buyers who are ready to act can find incredible opportunities in Q4 2024. Homes that have been sitting on the market, particularly in higher price ranges, are ripe for negotiation. Sellers, meanwhile, must recognize the reality of long days on market and adjust their expectations accordingly if they hope to close a deal before the year ends.

Final Thoughts

The Bay Area real estate market in Q4 2024 offers both challenges and opportunities. With over 6,300 active listings—many of which have been sitting for months—buyers are in an excellent position to negotiate deals that might have seemed unattainable earlier in the year. For sellers, this is the time to get realistic about pricing or risk staying on the market into 2025.

Whether you’re a buyer ready to make a bold move or a seller looking to attract interest before the year closes, understanding the current market dynamics is key. For buyers willing to negotiate aggressively, the next few months could lead to some incredible deals.