May 2021 Newsletter

Last newsletter I had mentioned the crazy demand and offers generated way over asking that sellers were receiving, and now, after 43 years in the business I can honestly say there has never been a market quite like this one. Not only are there multiple offers on just about every home listed, but the terms the buyers are offering the sellers are also a reaction to this market. I have seen offers with no loan or appraisal contingencies checked as well as some with no inspection, and letting the sellers stay in the home up to 90 days at no cost to the sellers. These terms are not an anomaly, but what buyers think it is necessary in order to get their offer accepted. To me it’s pretty alarming and I pause when I see these offers come in. Buyers are so frustrated and some have put offers on so many homes only to be outbid, or out “cashed” but they still are hopeful and react quickly to any new listing that comes on the market.

Conversely, sellers are sitting in the proverbial cat bird seat. Even when the list price is set intentionally to attract multiple offers, I am still surprised, if not shocked, at what buyers are willing to pay. Now that there are enough closed sales and data to support values, agents that are in touch with the pulse of the market, are setting proper list prices in order to get multiple offers. I have been present on the showings of several of my listings, to allow agents and their clients the 15- 20 minutes they are allowed to see the home and the conversations are concerning. Buyers want to know when this market will settle down. Will there be a correction to the market soon? Will there be an economic downturn and will real estate lead the way? Will the stock market lead the way? What about interest rates? Are we in a housing bubble? So many things on the minds of these young buyers, so many things to consider about their jobs, their families, their futures. The reality is they still need a place to call their own and while rates are so low and stabilized they are relentlessly pursuing home ownership.

I do have some predictions and observations that I shared with these people so feel

free to call me and we can chat. If you are thinking about selling in 2021 and you want to capture the intensity of this market, please give me a call. If you are just interested as to the value of your home, your rental, your multi-family property let’s chat. As you know, laws are changing quickly with respect to your rental property(ies) and so are capital gains taxes on your principal residence. If you are thinking of moving out of state call me and I can refer you to some great agents I have worked with in Texas, Tennessee, Arizona, Nevada, Colorado, etc. See you around the neighborhood!

July 27, 2021

July 2021 Newsletter

July 2021 Newsletter

 

As expected, the market slowed down after the July 4th weekend. People were intent on getting out of the house and taking family vacations. Two weeks afterwards, the market has definitely slowed down a bit. Interest rates are still phenomenal. As of this publication there are 20 new listings that have just hit the market in the last 7 days!!! Skewing the supply and demand dynamic. The Federal Reserve just met and it seems like they are denying pending inflation, however, there is talk about raising rates possibly next year. The ten year treasury stands at 1.75%, boosted slightly by foreign investors seeking a safer haven for their money as most countries are at a negative rate. We are seeing fewer cash buyers, but most offers from buyers have a minimum of 20% down. Closings are very quick still, most escrows typically closing in 30 days. However, we are seeing offers with as little as 14-21 day closings and allowing the seller to rent back at no cost to seller post close of escrow. The buyers that are paying cash are getting “purchase money rates” and are refinancing within 90 days after close of escrow. We are seeing some buyers taking advantage of their relationship banking, moving their 401K money into these institutions to get as much as a half a point off their interest rates. Most buyers are locking in their rates upon acceptance of their offer and not “floating” to see where the market ends up. We are seeing a cross section of buyers from young families with their parents helping out on the down payment to young professionals in the tech industry with lots of money down. The lower rates kind of eases the tension buyers feel when they thing they have overpaid for the property.

We are starting to see a lot of commercial space available as the stay and work at home dynamic becomes more permanent in nature. All indications from leading economists say the market should be strong and steady for the rest of 2021 and 2022. By steady, they mean a lower single digit appreciation across the board, compared to the double digit appreciation we have seen in the South Bay the last two years.

The numbers are in for the first six months of 2021 and RE/MAX again is the #1 company in the South Bay in transactions (number of homes sold) and dollar volume. As agents we are bombarded by what others consider the next best thing, the next best app, and the next widget to help our business, Sandy and I pride ourselves on personal care

and attention. While we do have the best technology at our fingertips, and feel we market our properties better than anyone, it’s still about the personal care and attention that makes a difference.

Please don’t hesitate to call us for any of your real estate needs, from a simple valuation of your home, what to do to your property to make it the most presentable, or referrals to trust and probate attorneys we have worked with, to all of our vendors including plumbers, electricians, handyman, painters, haulers, etc. See you around the neighborhood! 

 

Posted in Market Updates
July 31, 2017

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