Here we are on the brink of the spring sales market in the East Bay and many would be homebuyers and potential sellers are thinking, “Is now the time to make the move?” To help you with that decision, we wrote the following post using the recently released California Association of Realtors 2019 Housing Report and provided the highlights and local information from the report below.

 

Housing market conditions will continue to soften

 

  • Sales of homes are down double digits despite the recent decline in interest rates.
  • Price growth remains near the lowest levels since early 2012.
  • The fundamentals of the market continue to be solid
  • There is a window of opportunity for buyers as more sellers place their homes on the market.

The stock market volatility is causing some buyers to rethink their decision to jump into buying a home right now according to polls conducted by C.A.R..  With stocks plunging 5000 points recently, the home buying market remains jittery, even when the Dow recovered most of its losses. The Government shutdown also had an impact on buyer attitudes and with another shutdown being threatened, 25% of the potential home buyers that the C.A.R. polled for a study on how the shutdown impacted buyers, said they decided not to buy due to economic uncertainty.

 

As of the end of the year, sales have dropped to their lowest level since January 2015. Sales started to decline after December 15, 2018 with Bay Area home sales having the largest year over year decline since October 2010 dropping 17.5%. The decline has affected the entire market in all price segments. The bright spot was San Francisco, which posted an 11.3% increase and was the only market in the state to see a positive sales year over year. (For comparison, Contra Costa County dropped 16.7% and Alameda County dropped 19.9% year over year.)

 

Sales of existing single-family homes fell .05% in Alameda and in Contra Costa, sales were down 3.9%. Home prices, however, have continued to rise, but at a very modest pace. Interesting to note, that sellers felt the lackluster sales pace and on average, 38.8% lowered their listing price on average 4.3%. In fact, the sales price to list price hit the lowest level since 2015.

 

The median price of existing family homes fell 1.4% year over year from $862,000 to $850,000. In Contra Costa County, home prices increased 2.1% from $600,000 to $612,000. Active listings continued to increase for the 9th consecutive month and in all price ranges. Anecdotally, sellers are placing their homes on the market in the East Bay in increasing numbers, as well. Days on the market has also continued to rise as the market slows, with an average of 32 days on the market.

 

As we have mentioned before, the fundamentals remain strong. Job growth has increased by 1.8%, consumer consumption has increased by 3.5% and GDP in the third quarter of the year was at 3.4% and the Consumer Price Index was 2.2%. The interest rates did rise in 2018, but have dipped slightly in early 2019, however, we are still at historic lows of less than 7%.

 

Overall, we see cooling in a real estate market that has been white hot for the past few years. Sellers need to have a strong price strategy going into the spring market and buyers will be able to have more inventory to choose from and have a bit more time to make a decision on a home in the spring market.

 

To see the whole forecast presentation go to:  https://www.car.org/marketdata/marketforecast

 

If you would like more information, our team at Berkeley Hills Realty utilizes our market expertise in helping you strategize a competitive price for your home or we can provide  accurate listing data so you can see what is on the market as soon as it is posted. Contact us today!