As a realtor in the west valley I have been keeping an eye on inventory in Woodland Hills and Calabasas lately. The prices have climbed sharply over the last couple of years and some homeowners are reaching a point where they are testing limits. Pricing accurately is important and so is keeping an eye on the competition. The inventory driven price gains are only in effect if there is a limited inventory. Therefore pricing homes during periods of very low inventory is relative to what is available on the market. i.e. If there are no homes in Calabasas under $1,000,000 then the market may justify $1,000,000 simply because of a lack of choice. The actual sold comps are not as important as the buyer activity level and their limited choices. On the other hand if there are many homes to choose from the buyers will start to compete on value. The buyers can choose which home is the best value or bid on homes to see who is the most motivated to sell.
