Contra Costa Bay Area Real Estate Blog

Jason Wheeler and team are multi year experienced Real Estate Pros serving Pleasant Hill, Concord, Walnut Creek, Martinez and Lafayette in Diablo Valley. 

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Oct. 3, 2018

Pleasant Hill Real Estate Trends Changing Directions?

Pleasant Hill

Pleasant Hill real estate trends have shifted over the last few months.

Review Pleasant Hill Report Here

These changes in cooling off are primarily due to mortgage interests rates continuing to rise and an influx of sellers trying to chase the prices from earlier in 2018.

In our last blog post we illustrated how a key treasury note has spiked through a five year resistance level indicating the trend in rising rates will likely continue.

Bay Area Home Sales Were the Slowest for August in Seven Years as Activity Drops 10 Percent Year Over Year; Median Sale Price Declines Month to Month Again but was Still Up 12 Percent Year Over Year New data released today by CoreLogic shows a total of 7,659 new and existing houses and condominiums were sold in Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Solano and Sonoma counties in August 2018. 

This number is up 1.8 percent month over month from 7,524 sales in July 2018,* and down 9.9 percent year over year from 8,504 sales in August 2017.

Year Over Year Change in Bay Area Real Estate Sales

Note that Contra Costa County sales are down 12.6% from the same month last year... 

Could this be a big red flag on a shift in the market place?

Bay Area Home Data

How Will New Real Estate Trends Affect Pleasant Hill Real Estate

While this newer trend is ultimately good news for frustrated buyers, years of steadily increasing prices mean that those hoping to buy a home will need to spend a bigger share of their income once they find one, unless we see prices decrease.

At the same time, raised Mortgage interest rates will be increasing payments as they continue to go up.

Will bay area income continue to keep up with the home prices?

Nonetheless, those buyers daunted by low inventory and high prices have reason to be cautiously optimistic as parts of the housing market begin to ease.

If you've even been thinking of buying a home...

It is important that you get your questions answered.

NOW may not be a great time for you to buy.

Get your questions answered and review our free home buyers crash course below.

Pleasant Hill Home Buyer Crash Course

Oct. 2, 2018

Should I Still Buy a Home In Pleasant Hill With Mortgage Rates Trending Up?

Should you still buy a home in Pleasant Hill even when mortgage rates have been trending up consistently since July of 2016, and the local Pleasant Hill market has changed significantly in recent months?

In fact... Mortgage interest rates, as reported by Freddie Mac, have increased by close to a quarter of a percent over the last several weeks.

The FED is expected to raise rates at least once more in Q4 for 2018.

The ten year note continues to hang around the highest point since 2013

TEN YEAR NOTE LAST FIVE YEARS

mortgage rates since 2013 pleasant hill california

Freddie Mac, Fannie Mae, the Mortgage Bankers Association, and the National Association of Realtors are all calling for mortgage rates to rise another quarter of a percent by next year.

In addition to the predictions from the four major reporting agencies mentioned above, the Federal Open Market Committee recently voted “unanimously to approve a .25 percentage point increase in the primary credit rate to 2.75 percent.” 

Historically, an increase in the primary credit rate has translated to an overall jump in mortgage interest rates as well.

This has caused some purchasers to lament the fact that they may no longer be able to get a rate below 4%.

However, we must realize that current rates are still at historic lows.

Here is a chart showing the average mortgage interest rate over the last several decades:

Could you imagine if you had bought in the 1980s at today's prices?!?

That would be quite a payment!

bay area mortgage rates charts pleasant hill

HOME SALES TRENDS HAVE CHANGED IN LOCAL MARKETS

In the four weeks ending on September 23, 22.9 percent of homes sold for more than their asking price, across the metros tracks. More than one-in-five sounds like a lot, but it represents a 2.6 percentage point decline compared to the same period last year when 25.5 percent of homes sold above their list price.

The share of homes that sold above list hasn’t been this low since 2016 and has been declining since its peak of 29 percent in June.

In fact in the Bay Area alone home sales tanked almost 10 percent last month according to CNBC.

Total home sales for the Bay Area fell nearly 10 percent compared with August 2017, according to CoreLogic.

Sales increased 1.8 percent compared with July, but the total volume was nearly 18 percent below the August average going back to 1988 and the lowest since August 2011.

Sales activity for the summer, June through August, was the slowest in seven years.

SHOULD I STILL BUY A HOUSE IN PLEASANT HILL?

Though you may have missed the lowest mortgage rate ever offered, you can still get a better interest rate than your older brother or sister did ten years ago,

A lower rate than your parents did twenty years ago...

...and a better rate than your grandparents did forty years ago.

That being said it does not necessarily mean that you should buy your home right now!

Depending on your situation you may NOT be in the best position to buy.

I'm committed to giving you good honest Real Estate advise here on this blog...

Here's what I REALLY think about if NOW is a good time to buy in the bay area for 2018...

 

Nov. 2, 2017

Is Contra Costa Real Estate Topping Out?

 

Could bay area real estate be topping out?

Many say that it’s the time of year.

Buyers are frustrated and everybody is beginning to shift their focus to the holidays.

However it’s highly possible this could be a perfect storm for real estate values to have a significant traction.

Here’s 3 reasons why the Bay Area real estate market may be topping out

ONE: National Association of realtors report that homes pending for sale all over the country of slowed significantly nationwide.

Reports from the East Bay times confirms it’s even more serious in the bay area.

TWO: The feds policy to begin reducing its balance sheet basically means it’s going to aggressively start raising rates. Rates have already been raised several times this year and it’s expected but they will be a raised aggressively starting in December.

THREE: There’s a very real possibility due to the new tax proposal in Congress that the Mortgage Interest Tax Deduction along with other Real Estate write offs could be taken away from homeowners. This could cause some significant changes to home owners in high taxed states and could affect real estate values especially in California.

If the mortgage interest tax deduction is taken away on any level it will raise the overall costs of real estate ownership and could have an overnight impact on home values especially in wealthier areas.

One BIG reason it may NOT be topping out.

At the end of the day supply and demand are the biggest key indicators of an economic market... the only indicator I see that will hold this market up is the LACK OF INVENTORY on the Bay Area market.

In lieu of other heavily weighing factors until a catalyst occurs making people WANT to sell more homes this market could hold strong.

You can check the inventory in your area by clicking here.

Here’s the bottom line

If you’ve been tossing around the idea of selling it would be a good idea to contact your agent sooner than later

If you have any need to leverage equity in your home lower your interest rate or take cash out you may miss the boat on refinancing once the Fed starts to raise rates.

If you’re a potential buyer it’s highly likely all this will be a wash if real estate prices come down and rates go up they can possibly cancel each other out depending on the severity of both corrections.

We will have to wait and see I guess.

PS: A while ago I shared with you how I got rid of all of spam callers. I got some great feedback on that post so if you are constantly in undated with Robo calls go back and check it out

This week I wanted to get A little bit back to the market since there are several key indicators pointing to a cool down in the housing market that were recently released.

Let me know your thoughts or questions in the comments below.