Is the real estate market slowing down a bit? Well, from where I’m sitting, yes we are seeing a bit of a slow down. But let’s not take my opinion about the market slowing down. Let’s look at what the market is showing. Nationally, it is the first month that we have seen buyer demand go down since November. Also according to the Home Purchase Sentiment Index, where they survey buyers asking if they feel it is a good time to buy right now, it’s dropped from 61% last year, down to 35% this year. The buyers perception of the market is that it’s not the best time to purchase. Some buyers are feeling a bit defeated.
Factors Contributing to Buyers NOT Pulling the Trigger are:
- Record High % of Homes Selling Over List Price
- Record Price Appreciation (Case Shiller homes across the Country have appreciated at 14.6% this past year.
- Record Low Days On Market (how long it takes a home to sell).
- Historically Low Mortgage Rates (over the past year, last year the average 30 year fixed hit a low 16 times).
- Extremely Low Inventory (which has caused bidding wars).
Some good news is that we are ahead of where we were last year at this same time with buyer showings. Also, it’s the end of Summer and school is back probably in session. Historically in our area, since we have a shorter summer, we’ve noticed a drop in sales, especially the month before kids go back to school. But the good news is that from January to May inventory has actually gone up about 18% from since January, which should make it a little easier for buyers as they have more to choose from.
Also, buyers beware! According to the Real Estate experts, Freddie Mac, Fannie Mae, the Mortgage Bankers Association and The National Association of Realtors, they are forecasting on average that interest rates will go up, which means it’s going to cost you more, to borrow money for a home and you’ll qualify for less, so if you’re on the fence about buying, now may be a good time. Also, according to J.P. Morgan Insights Report, “Homebuyers-Interest rates are still historically low, though they are inching up. Housing prices have spiked during the last six-to-nine months, but (and buyers, here is where you need to listen in) but, we don’t expect them to fall soon, and we believe they are more likely to keep rising. If you are looking to purchase a new home, conditions now may be better than 12 months hence.”
So I hope this information was helpful. I’m Tanja Odzak, with Our East Bay Home brokered by eXp Realty, and that’s what’s happening nationally in real estate, and from where I sit this looks very similar to what we are seeing here locally. If you have any questions, however big or small, feel free to reach out as I’m always here to help.
I’m a Top Producing Realtor® in the OAKLAND / BERKELEY / EAST BAY AREA. I’ve been in the Oakland / Berkeley / East Bay since I came up to do my undergrad at UC Berkeley (a long time ago!), with a short stint at UC Davis while getting my Master’s. I take my duties as a Realtor® and Fiduciary very seriously, I enjoy educating my sellers and buyers along the way. Putting People, Before Profit.
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