Where Are These People Going?

I recently read an article indicating a recent survey of 1,000 people, 34% of them said they would be leaving the Bay Area.  This survey was conducted by the Bay Area Council. The reasons for the exodus – home costs and traffic, which to those folks indicate the quality of life in the San Francisco Bay is going down.

While this is true, while people are leaving more people are arriving.  And yes home prices are escalating as is the traffic. Yet the demand for housing is still relatively high and until the supply meets the demand, it is likely the prices will continue to rise.  Yet (my opinion only) the Bay area has so much to offer. We are close just about everything and our weather is hard to beat.

So, I wonder, where are these folks relocating to that has as much to offer as the Bay Area?

Source http://www.ktvu.com

Danville Home Sales 1st Quarter 2016

For the first three months of 2016, there were 100 closed real estate sales for single family detached homes. Compared to 2015 this is 10 percent less closings for the same time frame. Here is the breakdown for the first quarter.

January February March
# Listed    29    64    80
# Pending Sales    21    41    60
# Closed Sales    33    23    44
Average Sales Price 1,219,866 1,205,690 1,280,206
Median Sales Price 1,102,500 1,100,000 1,187,500
Average Days on Market      40     27     29
Highest Sales Price 3,200,000 3,200,000 2,285,000
Lowest Sales Price 835,000 842,000 825,000

The average sales price is at par with 2015. Average for 2015 $1,249,799. Average to date for 2016 $1,246,418. This is only the first quarter so there is no way at this time to tell which way the market will go. As we are heading into the Spring season, we will see more homes come on the market.

For the month of March 2016 there were a total of 44 single family detached homes. This is down slightly from 2015 units sales were at 55. Average sales price is up 8% compared to 2015.

San Ramon March Sales

March 2015 March 2016
# Units Listed 87 78
# Units Sold 44
Average Sales Price $1,100,477 $1,015,666
Median Sales Price $985,000 $1,055,000
Average Days on Market 14 13

Currently 60 homes on the market for sale in San Ramon, which based on the current trend is about one month’s inventory. As we head into the Spring season, I am seeing more “coming soon” signs indicating that we will have more homes for buyers.

Home Warranties – Are They Necessary

Value of A Home Warranty

Home warranties are not just for the new buyer. Owning a home comes with continual maintenance and repairs. A home warranty for many is a viable option.

Purchase a home warranty if any one of the following is true:

  1. You have appliances that are getting old
  2. Your house is more than 5 years old
  3. You do not have time and patience to get the repair done yourself
  4. You do not have a trusted contractor and you do not want to go through the pain of cold calling contractors from Yellow Pages, screening them, getting quotes, and checking their work.
  5. You do not have a cash cushion to handle costly repairs
  6. You are buying a home for the first time.

If you are a first time home buyer, you should definitely get some kind of coverage. New home owners are generally short of money, so the risk of having to pay for a pricey HVAC repair is just too much for them to manage.

Benefits for A Seller

  • Make your home a preferred home. Eight out of ten buyers prefer to buy a home covered by a home warranty plan. (Source: Gallup Poll)
  • Attract more first-time home buyers. Provide peace of mind for buyers who might be intimidated by the high cost of repairing or replacing systems or appliances.
  • Leverage your Home Warranty. Make your home stand out from other listings.
  • Avoid closing delays. A Home Warranty can minimize the chance that an equipment or system failure could delay closing.
  • Free coverage during listing*. In most states, payment is due at closing.
  • No post-sale worries. If a breakdown happens after closing, the buyer will turn to the Home Warranty.

The 2016 real estate market for California looks strong based on all indicators from various sources. Yet no one can really predict which way the market will go. The low inventory of homes for sale has kept the demand high in our local area. And it would seem that is the case of low inventories across the country. In any event, with low inventories, buyer demand still up we can expect for prices to appreciate somewhat or at least stay at current levels.

Here is an excerpt from an article in January issue of California Real Estate Magazine by Roger Cruzen regarding the California real estate market.

“Predicting what’s ahead for California real estate from one year to the next is as much art as it is science. Complex economic models help experts analyze key local, state and national trends over time. Yet even these sophisticated models sometimes fall short when it comes to explaining how certain trends influence buyers, sellers and the Realtors who serve them.

 Job and income growth, low or no inflation, continued low interest rates are evidence that California has moved beyond recovery and into a new and different cycle, one many worry may not be sustainable. Forecasters predict statewide sales of existing single family detached homes will reach 433,000 this year up 6.3% over 2015. The median sales price is expected to rise 3.2%, which reflects the slowest rate of appreciation in the last five years.

The average 30 year fixed interest rate will rise slightly to 4.5 percent. Low inventories of homes for sale increases demand, driving up prices and making it harder for first time buyers to enter the market.

The global economic slowdown, financial market volatility and anticipation of higher interest rates are some of the challenges that may have an adverse impact on the market’s momentum in 2016”.

Going into 2016, the San Ramon Valley real estate market showing signs of even more appreciation. Art or science – who knows – trying to predict the real estate market seems futile. I say let’s take it one day at a time. All we know is what the market is doing right now – the future is the future.

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