Bay Area real estate prices at highest level since summer 2022

Homebuyers could possibly be forgiven for pondering it was 2022.

In March, the common sales price of a house within the nine-county Bay Area was $1.39 million, latest data shows California Association of Realtors. That brings prices back to where they were two years ago and represents a 15.5% increase from this time last yr – the most important increase amongst California regions.

This is an indication that prices have recovered from the autumn 2022 slump after the Federal Reserve's rate of interest hike sent home sales right into a downward spiral. Single-family home prices are currently priced at $1.4 million in Alameda County, $890,000 in Contra Costa County, $1.75 million in San Francisco, $2.2 million in San Mateo County and $1.9 million in Santa Clara County.

“Bay Area buyers are realizing there’s no point waiting for prices to fall,” said David Stark, spokesman for the Bay East Association of Realtors. “Overall, we see a very strong increase in prices.”

But with regards to high prices, the similarity to 2022 largely ends.

As is currently the case, inventory levels have fallen significantly Mortgage rates of interest of over 7% Keep potential sellers with historically low pandemic-era mortgages — in some cases below 3% — in place. And when a house comes in the marketplace, there's an excellent likelihood buyers will get right into a bidding war.

The ongoing lack of supply has led to a decline in home buying activity – across the nine counties, sales fell 5.4% year-over-year in March. Contra Costa County saw the most important decline in sales with a 21% decline. Low inventory helped drive the county's average sales price up 9.5%.

For buyers, the increased property prices and better rates of interest are a double burden, which makes the acquisition of home ownership much more distant for a lot of. Even just a number of rate of interest differences can add tons of of dollars to a monthly payment.

It is just not expected that buyers will likely be relieved of the high rates of interest within the foreseeable future. Although some economists are predicting a decline in rates of interest within the second half of this yr, stronger than expected inflation data The inflation seen in recent weeks could mean that the Federal Reserve will keep rates of interest at their current levels. Mortgage rates are likely to be based on rates of interest.

Still, real estate agents say competition amongst buyers is fierce as among the pent-up demand from the typically slower winter home-buying and selling season rebounds.

“Even with current interest rates, buyers are still looking for these homes,” said Ned Laugharn, an actual estate agent in San Jose. “People are jumping in because property prices are rising faster than interest rates are falling.”

Agents at Laugharn's brokerage firm, Silicon Valley Premier Properties, have seen as many as 20 offers on a single home. Buyers make major concessions, foregoing inspections for instance, and infrequently bid well above the asking price.

“Competition is back to the level it was before the market slowdown,” said Laugharn.

Uncertainty over Real estate commissions After a comprehensive settlement by the National Association of Realtors, there appears to be no peace for buyers either, agents say.

In Santa Clara County, homes are in the marketplace a median of just 10 days today, in comparison with 14 this time last yr. based on Redfin data from March. Compare that to 22 in San Francisco, 13 in San Mateo and Contra Costa counties and 12 in Alameda County.

The competition surprises some buyers who’re grappling with the concept pandemic-era bidding wars could return.

Brian Fitzpatrick has spent the last six weeks in search of homes within the East Bay. He noticed that inventory was limited, he said, so he waited until spring to start out looking, since traditionally persons are more inclined to submit offers.

“I looked at some houses in Montclair last week – one of them sold for 30% more than asking,” he said.

“I would like to find a house today and stop looking,” said Fitzpatrick, who — after spending the previous couple of years between Oakland and Lake Tahoe — hopes to return to city life. “Who wants to spend all their time looking for an apartment?”