Kelsey Lane Real Estate market Trend blog

By Kelsey Lane, Realtor

 

The real estate market has been very hot lately. In some Bay Area pockets, prices have gone up over 35% during the pandemic. But it hasn't been just the past couple years that have been hot - it's been a thriving and fiery real estate market for ten years or so. That said, some wonder if things have begun to change.

 

Factors fueling the market recently were low interest rates, low inventory, and a sense of action and control to purchase property and sell property when so little has been out of our control during the coronavirus epidemic. Inventory still currently remains low, and people seem to still have the desire to buy homes. However, rates have begun to rise. We're not sure how high they will go, but we're fairly confident this will temper the market a bit and that we should see a greater number of homes for sale on the market at any given time due to the market turning over at a slightly slower rate. What does this mean for buyers and sellers?

 

BUYERS: Buyers will be qualifying for less because their income remains what it is, and rates are now higher. This may mean that some buyers are priced out from being able to buy a single family home in the Bay Area, and some buyers priced out completely from being able to buy anything, even a condo. However, it's not all doom and gloom - many remain able to purchase; it's just a cautionary tale. What is important for Bay Area buyers to keep in mind during these changing times in today's market?

  • Make sure you truly like the home you are getting ready to make an offer on.  That way, if the market goes up or down, if you can afford your payments and you like your home, you'll be able to weather the changes.
  • Be open minded - even if you were convinced you only would buy a single family home, it could be in your best interests to go see some condos and townhouses.
  • Buy what you can afford as far as monthly payments and don't overextend yourself. Keep some reserves. It will make any market fluctuations much less stressful.
  • Have your Realtor check off-market properties and "coming soon" properties to find deals that involve less competition as far as multiple bidding.
  • Take a chance on going to see homes that are cluttered or don't show well, or that are hard to view due to seller complications. These homes often garner less offers resulting in lower prices.

 

SELLERS: A lot of would-be home sellers have been waiting for the perfect time to put their house on the market to get the highest price possible. It's nearly impossible to "time the market" as any financial advisor will tell you. That said, we do know interest rates have begun to rise and that it will affect how many buyers are in the marketplace. That may make now a peak time to consider selling. Here are a few tips for today's sellers:

 

  • Don't time the market, but if you are needing to sell and move anyway, remind yourself of the reasons why it's important for you to sell. That way if you miss the "peak" later you can rest assured you're living according to your goals and values. Do you need to move closer to family? Do you need money out of your home equity?
  • Be decisive and don't delay. What we know for sure is that currently there is low inventory and still a high demand. What we don't know is how long that will last. Once you determine you're ready, move forward.
  • Once you decide to sell, do your preparations quickly. Hire your Realtor and have them help with getting everything coordinated - make sure you do your cleaning, storage, and repairs within a two to three week time period and get your home listed.
  • Have an interim plan for where to stay while your home is being shown, if possible. You'll get more money for your house if it is cleaned, staged, and you're not living there.

 

The market may continue to be unpredictable for awhile. If you know your own goals and reasons for your decisions, you'll have peace of mind to navigate through the uncertainty.

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Kelsey Lane has been a Realtor in the Silicon Valley since 2003 and is a Master Certified Negotiation Expert through the Real Estate Negotiation Institute, specializing in listings. She works at Compass. She is also coaching certified through the Life Purpose Institute and approaches her real estate business through the eyes of a life coach. Cal-DRE #01390557