Interest Rates are up but in the range of where they were in 2003 to 2007. That was a strong real estate market, the difference is that we are heading into a forced recession in 2023 whereas 2003 started the post dot-com bubble recovery. Two very different environments.
Pending Home Sales are down in Fremont, Newark and Union Cities but that can be blamed on fewer homes to available to but also lower demand from higher rates, fear of job losses, and inflation.
The Median Sales Price is Down. Case-Schiller is predicting home pricing could drop back to pre-covid levels. That's possible but they are also saying their is a large imbalance in supply of homes, so we may have some downward pressure caused by the forced recession to combat inflation, but the long term indicates further price improvement until the supply side of the equation is solved.
Median Sales Price vs. Mortgage Payment in California
There's been a 52.6% rise in the mortgage payment because of higher interest rates and only a 0.6% drop in the Median Sales price. Unless incomes go up, the only way to stoke demand is a lower home price in the short or a drop in the rates which is predicted to happen in 2023.
Average Days on the Market for Fremont, Newark and Union City is trending down, but I suspect that has more to do with reduced inventory in the real estate market.
Average Days on the Market has come Down and I suspect this is because of the reduced inventory and post New Year Enthusiasm. Every New Year starts the new buying season. I've personally seen an uptick in buyer interest however.
Always a good indicator of future price moves, Inventory of Homes Available for Sale in Fremont, Newark and Union City is Declining. If this continues pricing will stabilize and maybe improve, however, we are seasonally just starting the selling and buying season. Inventory should continue to rise from now and peak in August. If sellers decide to not sell that'll keep pricing up.
If you are thinking of selling or buying please reach for a free consultation. I look forward to your questions. Best regards,
-Sunil