The Bay Area is one of the world’s great metropolitan areas – as a financial and cultural center; in the spectacular beauty of its setting and surrounding open space; as a hothouse of innovation; in its diversity, openness and opportunity – and despite its current round of challenges, we expect it will continue to be …
Continue reading “Lamorinda Home Prices, Market Conditions & Trends May 2023”
The post Lamorinda Home Prices, Market Conditions & Trends May 2023 first appeared on PEB.
Regarding Market Cycles. Over the past 40 years alone, the San Francisco Bay Area has seen 4 major upcycles or housing booms.
Some uncertainty clearly continues with inflation, interest rates, stock markets, bank crises, high-tech layoffs, and now, as of early May, federal debt-limit negotiations. But, so far, the 2023 housing market has generally been steadily moving in a positive direction.
The post Oakland-Berkeley Inner East Bay Home Prices, Market Trends May 2023 first appeared on PEB.
The number of new listings has also dropped dramatically. This is mostly ascribed to the “mortgage lock-in effect,” i.e. owners with very low, long-term, fixed-rate mortgages are reluctant to sell to then buy at much higher prevailing rates. This decline in new listings has major ramifications for supply and demand dynamics, and increases pressure on prices …
Continue reading “San Mateo County Home Prices, Market Conditions May 2023”
While increasing from mid-winter lows – with some very big sales occurring – luxury home sales have generally seen even larger declines as compared to the peak of the pandemic boom, when sales volumes often hit spectacular new highs. Still, some very large sales have continued to occur this year.
Even with the increase in demand, sales activity remains far below last spring due to a number of economic and supply constraints. The magnitude of these declines varies widely between different markets, and prices in the vast majority remain much higher than before the pandemic.
A significant minority of buyers are paying all-cash. Open houses are seeing increased traffic, more listings are selling, and selling more quickly with multiple offers. Median sales prices have generally ticked up in 2023, though still down across the Bay Area from the market peak seen last spring.
Looking at the overall Bay Area, buyer demand has continued to rebound from its late 2022 nadir. Though mortgage applications are still well down year over year, many buyers have accepted higher interest rates as the new normal and decided to move forward – and rates have recently been trending downward.
Buyer demand continued to rebound from the depths of the mid-winter slowdown: The number and percentage of listings going into contract, and overbidding percentages continued to climb, and days-on-market to drop as the spring selling season gained traction.
April, May & June sales volumes are commonly among the highest of the year, and this is especially true for luxury home sales.
The post Lamorinda Home Prices, Market Conditions & Trends April 2023 first appeared on PEB.
Luxury home sales have been hit harder since the market correction began in mid-2022, though they too have been rebounding in 2023.
Across the Bay Area, year-over-year sales declines in the highest price segments have outpaced drops for less expensive homes, and their demand-to-supply ratio – the number of sales compared to the number of listings for sale – is much weaker.
The post Diablo Valley Home Prices, Market Trends & Conditions April 2023 first appeared on PEB.
The number of new listings coming on market continues to be extremely low, as many potential sellers hold off from listing their homes due to the doubling of interest rates since early 2022: This constitutes a huge factor in market dynamics and is undoubtedly holding back sales activity.
However, it’s worth remembering that the market in Q1 2022 was severely overheated, and approaching the peak of a historic, 10-year boom. This will distort many year-over-year comparisons.
But though conditions have improved considerably, the market remains significantly weaker on a year-over-year basis, and across the Bay Area, median home sales prices have declined.
The post Oakland-Berkeley Inner East Bay Home Prices, Market Trends April 2023 first appeared on PEB.
Buyers generally shrugged off the local banking crisis, the main effect of which, so far, has been a significant drop in interest rates in the 4 weeks after SVB collapsed and First Republic first came under pressure.
The Market Continues to Recover, But with Many Dynamics at Play. Buyer demand continued to rebound from the depths of the mid-winter slowdown: The number and percentage of listings going into contract, and overbidding percentages continued to climb, and days-on-market to drop as the spring selling season gained traction.
After the acute decline in market activity occurring in the 2nd half of 2022, buyer demand rebounded dramatically and most market indicators turned positive in early 2023: Open house traffic, number of offers, and overbidding and absorption rates all saw substantial improvement.
It is too early for significant effects to show up in home prices: Indeed, through February, 3-month-rolling median house sales prices saw year-over-year declines across all Bay Area counties.
It has been very challenging to predict short-term interest rate changes. Another major factor is the substantial decrease in the number of new listings coming on market, a critical issue with wide ramifications if it continues.
