Fire Season Is Underway – Resources to Protect Your Home and Loved Ones in the East Bay

East Bay residents are still reeling from a horrific wildfire season where since the beginning of the year, there have been over 8,100 wildfires which have burned well over 3.8 million acres in California. Everyone is now very familiar with the term AQI and most likely have personal photos of orange skies and red sunsets. Read More

We’re Here To Help!

Dear Valued Clients and Neighbors, Our offices will remain closed to the public during this time of SiP and social distancing surrounding the Covid-19 pandemic.  We are however actively working from home.  Please visit our “Agents” page to meet agents virtually. Read More

How could CoronaVirus Affect Real Estate in the East Bay?

There is a significant amount of fear and genuine concern around the coronavirus/COVID19 lately, as it continues to spread around the world and now, here, in the East Bay. People are increasingly affected by the illness and worry for their loved ones. Our hearts go out first and foremost to families that have experienced a loss. We also feel for our communities suffering from the emotional or economic impacts of the virus. If you are feeling fearful, we find the following facts useful: (source: Coronavirus: How to Keep Things in Perspective, by Ignacio López-Goñi for World Economic Forum)       We know what it is We know how to detect the virus The situation is improving in China 80% of cases are mild People heal Symptoms appear mild in children The virus can be wiped clean Science is on it, globally There are already vaccine prototypes Antiviral trials are underway Health and emotional concerns notwithstanding, Berkeley Hills Realty is here to be your real estate resource and we provide the following economic points for your consideration: 1. Real estate is a long game, the virus will have a short tail. If you are wondering if you should continue your home search, remember, real estate is a long game. Whether you ascribe to the optimism of a seasonal virus or carry the concern of a worldwide pandemic, this hardship will end. Although not soon enough for the 5% most severely afflicted, a vaccine will come. The median duration of homeownership in the United States is 13.3 years. The world and local economies will be back on track before your next move. Don’t put off life entirely for a short term fluctuation. 2. Forecasts have been downgraded, but economy may still expand. From the California Association of Realtors, “Last week, the International Monetary Fund (IMF) cut its forecast for global economic growth by 0.1%, but is still calling for an expansion in 2020, albeit at a slower pace. Similar orders of magnitude have been forecast for the domestic economy, with groups like Wells Fargo and others expecting GDP to grow by 10-20 basis points slower than their pre-Coronavirus forecast. Growth is expected to be slower, but the economy is still expected to grow.” 3. Stay calm and carry on. Shelter in place still needs a shelter. Whatever the circumstance, people need housing and will continue to need housing. Homeownership is the safest way to establish a permanent shelter. We see this necessity manifest in the throngs of people still attending weekend open houses. 4. Amid stock market woes, real estate provides a safe harbor for funds.  The Dow Jones stock index dropped 12% in value last week illustrating the fact that there is plenty of dread surrounding the potential impact from the virus. However, even though the overall stock market had its worst weekly declines since the 2008 financial crisis during the week of February 24-28, it rebounded on March 2 to 1,294 points or 5.1%— with its largest one-day point gain ever. Then it fell at the beginning of the next week, rallying some again by March 10th as world leaders developed a global plan. The stock market is volatile. We have seen this before, and know where savvy investors moved their funds. They moved towards real estate. Losses in the stock market may sideline some buyers who have lost liquidity. Others may look toward moving money out of the stock market entirely and place it into real estate holdings until the world economic dust settles. 5. Interest rates are dropping! The Federal Reserve issued an emergency 50 basis point cut to their target interest rates, and guidance suggests that the Fed may be open to future reductions in order to counteract the negative impacts to financial markets. This week, mortgage rates fell to an all-time low level of just 3.13%. That is down from 3.80% at the start of the year and represents significant cost savings over the life of a 30-year loan. Lower interest rates don’t just lower monthly payments. Lower interest rates can increase the amount of house and square footage you can purchase to meet your family’s needs. As the California Association of Realtors stated, “Short-run risks to the economy exist but are arguably offset by long-run benefits of lower rates at the individual level.” 6. Local economies will be hurt, but real estate is likely resilient. From event producers to gig workers, our local East Bay economy will experience an economic blow from shuttered doors and CDC recommendations to avoid crowds. Unfortunately, our lowest-paid workers from Uber drivers to wait staff may feel the brunt.  This puts homeownership further out of reach for some members of our community, but may not do much to decrease real estate values. The sad truth is that we have already seen our market price out pace most hourly employees. Other sectors will be more resilient. Tech jobs, for instance, will be more flexible and allow workers to work remotely from home. There may be a small short term blip as people adjust to the new normal of caution in crowds and increased handwashing. However, this won’t be an affordability equalizer as those who have been able to buy homes are likely to have more resources to weather this storm. 7. Foreign investment may be curtailed. Per the California Association of Realtors, “Reduced economic growth in China, specifically, could stifle demand for California real estate this year. However, foreign buyers represented just 3.9% of California’s home sales last year, so the impacts statewide will be muted compared to 6 years ago, when foreign buyers represented 8.0% of the market. In addition, because domestic buyers typically finance their homes in much larger proportions to their foreign counterparts, low rates could stimulate more domestic demand that would help to offset the impact to foreign buyer demand.” 8. It is an election year and local and federal politicians are motivated to protect the economy. This is an election year.  Local economies will be […] Read More

Steps to Take Now To Keep Your Pet Safe in the East Bay

Do you have pets? Do you have a plan in place in case of an emergency or natural disaster to make sure your pets are safe? As you are aware, the East Bay has had its share of “no time to think” occurences from fires to earthquakes and families can suffer their own personal tragedy, like a house fire, where pets are trapped in a home. Here are steps you can take today to provide security for your pet moving forward. Read More

Adding Value to Your East Bay Home And Helping The Housing Crunch

As you know, the East Bay is dealing with a lack of available housing and plans for high rise developments in the downtown areas of Oakland and other East Bay cities will only slightly be able to alleviate the need. Opportunities for individual homeowners to build ADU (accessory dwelling units) on their properties is gaining popularity as a way to increase the “infill” housing stock AND as an avenue for homeowners to create a passive income stream, add to the value of their homes right in their own backyards and create lifestyle flexibility. Read More

Media Reports Oakland As A Cold Market – Berkeley Hills Says No

According to a recent San Jose Mercury News article and the source article in RealtyHop, Oakland was on the bottom ten of a “market health report” showing that nationally, homes are selling for 4.98% less than asking price, making Oakland one of the four Bay Area cities ranked as “the coldest” in the US. Berkeley Hills pulled the housing statistics for Oakland from January 1 to December 31, 2019, and according to the MLS, Berkeley Hills sees that the median price for a home in Oakland averaged $804,762 with homes selling for 111.83% above asking price. That would hardly make it a “cold market”. If you look at the data the media is reporting, Berkeley is bucking a national trend of homes in major metropolitan areas getting anywhere from 8 to 2% LESS than asking price. According to the Multiple Listing Service in Berkeley, the average LIST price for a single-family home for December 2019 is $1,296,348, while the average SALES price is $1,296,346, which is 114.89% of the list price. Further proving that Berkeley and Oakland are far from cold markets, the average days on the market also beat most other national housing markets with homes sitting on the market for only 22 days in Berkeley and 25 in Oakland. 2020 Market Trends  Tracy Sichterman, Broker Owner, Berkeley Hills Realty states, “The market has seemed brisk with more inventory than we usually have in November and December which is good for buyers.  Don’t take too much time off from your search for the holidays as we are expecting a boon of listings in January.” An analysis from real estate site Zillow predicts home values will rise by about 2.2% in 2020. One reason for the tightening market: “underbuilding” of new housing stock because of higher labor and land costs, according to a statement from the National Association of Home Builders. Buyers use caution and an experienced agent when assessing “fixer properties” in this market as contractor costs have also skyrocketed. A steady drop in the 30-year mortgage rate to about 3.8% last month from 4.9% just a year ago is stoking demand, helped by a cut in lending rates throughout 2019 by the Federal Reserve to sidestep the threats of a potential recession stemming from a slumping global economy and the uncertainties about a trade war with China. Lower lending rates mean it’s less expensive to finance a 30-year mortgage. Lower financing costs can make it easier for buyers to handle higher home prices. Asked about where she sees the trend of the market heading into 2020, Sichterman points to some of the recent mergers and acquisitions in the real estate market. “Berkeley Hills Realty is still your local small independent and you can count on our long-standing history in the East Bay market to provide the information you need to make smart buying and selling decisions.” Read More

#REKindness – East Bay Kindness and Fun for the Holidays

Many of our neighbors are struggling with food insecurity, along with housing affordability and availability issues making putting gifts under the tree a struggle this Christmas. Our local food banks are always in need during this time of year, and Berkeley Hills Realty invites you to join us in helping fill the pantries while also filling your heart knowing you can help a person or family enjoy a full meal during the holidays. Read More

Continued Strong Market In East Bay Has Pros and Cons

As Berkeley Hills Realty has noted before, the solid economy, mixed with strong job growth combined with desirability of the East Bay combine forces for a continued strong market. Read More

Strategies for Dealing With Selling Your House During A Divorce

We all know that a divorce is an emotionally draining process and it can be a financial mess if a couple owns a home and makes mistakes when trying to sell it. During the past 20 years of being in business as a brokerage, we have worked with many couples going through a divorce and have learned a few valuable lessons along the way to share with anyone searching for advice. Read More
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