Table of Content
- Real Estate
- China’s ‘Zero Covid’ Overhaul Is Good News for San Francisco Tourism
- Low Inventory Playing a Role
- Single family residence sells for $3.2 million in Los Gatos
- Median home prices fell everywhere in the Bay Area except Solano County in June
- SF Bay Area Real Estate Investment Overview
- Bay Area Housing Market: Prices, Trends, Forecast 2022-2023
The percentage of people who believe prices will rise continues in the low single digits, as it has for the last five months. Members indicate reduced demand, but a lack of listings keeps inventory reasonably tight. According to C.A.R.'s, 1.6% of REALTORS® polled believe that prices will increase and only 4.6% think that sales will increase in the California housing market. The proportion of responders who think that listings will increase was 18.2%, still a drop of 12.1% from the previous poll. Only those who do not have enough money for a down payment are delaying their purchases.
It is calculated by taking all estimated home values for a given region and month , taking a median of those values, and applying some adjustments to account for seasonality or errors in individual home estimates. According to most experts, the market will continue to see moderate buyer demand and a positive rate of home price appreciation, despite a significant cooling from the extreme heat of early spring 2022. However, California is no longer a desirable location to live in since purchasers have endured exorbitantly high housing prices for years, and at least some homebuyers appear to have hit their breaking point. The median home price in California decreased 2.5 percent to $801,190 from $821,680 in September.
Real Estate
Multifamily and home improvement spending grew 0.3% and 2.9% respectively, while single-family spending dropped 2.6%. Single-family spending has fallen for four straight months as rising borrowing costs impact building. The Fed approved a 0.75-point rate raise for the fourth time this year, but it may be the last. The latest hike pushed the target range to 3.75-4%, the highest since January 2008.
Which required a minimum annual income of $73,200 to make monthly payments of $1,830. A minimum annual income of $126,800 was required to make a monthly payment of $3,170. Thirty-two percent of home buyers were able to purchase the $640,000 median-priced condo or townhome.
China’s ‘Zero Covid’ Overhaul Is Good News for San Francisco Tourism
In most local housing markets in the Bay Area — and across California as a whole — home buyer demand currently exceeds the number of properties available for sale. This supply and demand imbalance is putting upward pressure on home prices in our region and also statewide. According to C.A.R., buyer demand is dwindling as mortgage rates rise, reducing consumer spending power. Total construction spending rises despite falling single-family spending. September construction spending was up 0.2%, boosting the year-to-date total by 11.4%.
Infographic Courtesy of CARHere are some of the key points of the California housing market report for October2022, according to C.A.R. When a buttoned-up Fed economist says the U.S. housing market has entered into a “difficult correction”, it’d be wise to believe them. When it comes from the lips of Fed Chair Jerome Powell, it’s more of a warning.
Low Inventory Playing a Role
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If you ask the National Association of Realtors, that number may be closer to 7 million new homes. The monthly payment, including taxes and insurance on a 30-year, fixed-rate loan, would be $3,950, assuming a 20 percent down payment and an effective composite interest rate of 3.97 percent. According to C.A.R.'s 2022 projection, the U.S. gross domestic product of 0.5 percent in 2023, after a projected uptick of 0.9 percent in 2022.
She previously interned The Chronicle on the Business desk, as well as at Big Local News, focusing on data journalism. Updated to include drought zones while tracking water shortage status of your area, plus reservoir levels and a list of restrictions for the Bay Area’s largest water districts. “Power has shifted — finally — from sellers to buyers, so buyers should feel very comfortable negotiating very very aggressively,” he said. “A lot of people don’t know that,” said Santa Clara County Assessor Larry Stone, acknowledging how confusing our state’s housing policy can be. NewsNews Based on facts, either observed and verified directly by the reporter, or reported and verified from knowledgeable sources.
“When you look at sales activity before the end of the year, it’s likely going to be somewhat slower than what we previously thought,” Wei said. Now, entering the traditionally slow winter real estate season, growing uncertainty in the region’s leading industry is giving would-be buyers another reason for pause. But like other areas that saw big competition over a limited number of properties, the days of high prices appear to be waning. Businesses, baby boomers, and just about everyone else who was fed up with cold winters and high costs of living migrated to the Sunshine State, famed as much for its lack of income taxes as for its sandy beaches. Palm Bay, about an hour southeast of Orlando, along Florida’s Atlantic coast, absorbed some of those newbies. "The prices were way high here. For example, when we hire faculty at the university, it's really difficult because as soon as they see the cost of housing, they get scared."
Rising mortgage rates, recession fears and a volatile stock market have all tamped down home sales and prices in recent months from record-setting pandemic highs. This proposition by Google will add thousands of new homes to the Bay Area real estate market over the next ten years. About $750 million would be used for repurposing Google's own commercial real estate for residential purposes. This will allow for 15,000 new homes at all income levels in the Bay area. Another $250 million investment fund would be utilized to provide incentives to enable developers to build at least 5,000 affordable housing units across the Bay area housing market.
The Far North had the highest year-over-year gain of 6.5 percent, with the median price being $394,000. All price segments continued to decline by 30 percent or more year-over-year, with the segment between $750,000 and $999,000 experiencing the steepest decline at 40.8%. At 34.1 percent, the luxury market ($1 million to $1,999,000) experienced the smallest sales decline in October. Remember, the 30-year mortgage rate averaged 5.6% this summer vs. 5.3% in the spring and 2.9% in summer 2021. San Francisco could see the steepest decline in home prices of any U.S. metro area in the next year, according to a housing price forecast from Zillow.
The increase helped push San Francisco house values to a record monthly high of $1.8 million in June, 3% higher than the previous peak of $1.75 million in June 2019. You will find first-time homebuyers who are buying over $2.5 million or baby boomers looking for second homes in the $2 million range. However, the reality is that the pool of people who can afford to buy is smaller and smaller and the supply of housing is not growing with demand. They mostly consist of luxury condos and mega-mansions built for the elite of the Big Tech workforce. If condo prices are going to drop or remain flat in 2023, people will see a good investment opportunity. They’ll be able to get in at a good price and there will be an increase in demand.
If the Bay Area housing market can handle everything that has been thrown at it over the past few months, it will probably continue to chug along through 2020 and into 2021. The housing market is likely to lose value through 2024, but it’s more of a market correction than a market crash. Because America has a housing shortage, demand is likely to keep home prices from descending into oblivion.
Housing affordability is expected to drop to 18 percent next year from a projected 19 percent in 2022. Each month C.A.R. surveys 1,000 California consumers regarding their sentiments about various aspects of the housing market or the economy that directly impact housing to create a California Housing Sentiment Index. In September 2022, the overall housing sentiment index was 55 (down 10% from last month).
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