San Ramon Valley – Is Market Flattening

Recent market updates indicate many areas in the State are seeing the housing market going flat. This can be expected every so many years. The housing market goes up, goes down and goes sideways. Over the past couple of years in the San Ramon Valley area we have seen double digit appreciation. We are now seeing single digits.

Here is an excerpt from the article

California single-family home and condominium sales were 37,093 in May 2016, an increase of 2.2 percent from a revised 36,287 in April 2016. On a year-ago basis, sales were down 4.7 percent from 38,921 in May 2015.

“Sales continue to be lackluster state-wide,” said Madeline Schnapp, Director of Economic Research for PropertyRadar. “Without an increase in affordable inventory, high prices continue to depress sales.”

Year-to-date sales (January through May 2016) totaled nearly 156,000 properties, down 3.8 percent from the same time period in 2015 and nearly unchanged from the same period in 2014. Year-to-date sales in 2014 and 2016 were the lowest since 2008.

“Price appreciation took a breather this past month amidst lackluster sales,” said Schnapp. “How many buyers are there in the Bay Area willing to spend a million dollars on a 1,200 square foot, 2 bedroom, 1 bath home built in 1961? At some point buyers are just going to say, ‘No Thank You’.”

Within the 26 largest California counties, the highest year-over-year price appreciation was concentrated in counties of the greater Bay Area: Santa Clara (15.1 percent), Contra Costa (13.1 percent), Monterey (12.4 percent) and Santa Cruz (12.2 percent).”

To see what is going on in our area let’s look at one City – San Ramon home sales for the past 12 months to determine the trend.

June 2016 chart

As the chart indicates San Ramon home sales are starting to flatten. This may be temporary, yet home prices have increased significantly and the buyer pool is getting smaller.

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Looking for room to expand this five bedroom four bath home may be your answer. Located in San Ramon Cal High neighborhood. Corner lot with circular drive and extra parking for RV or boat on side yard. Two story with two bedrooms on first floor. Two master suites. Large eat-in kitchen.Completely rebuilt in early 90s. Stop by open house Saturday and Sunday July 2nd and 3rd 2016 from 1 to 4 PM.

ext photo kitchen bar

Which Age Group Has The Most Impact on The Direction of the Housing Market – San Ramon

A recent article in DSNews.com (see below)indicated that the Baby Boomers is the age group with the greatest influence on where the housing market will venture in the future. This is very evident in San Ramon/Danville area where many of these homeowners have been in their homes for 30 plus years and have no intention of moving. Thus the case for raising prices due to shortages of inventories.

I am out in the neighborhoods and talk with many of these homeowners everyday and their comments are: our house is paid for and where would we go? Here is what the research indicated:

“Baby boomers and other homeowners over the age of 55, which number about 67 million, control about two-thirds of the nation’s aggregate home equity, which computes to about $8 trillion.

These numbers put this group in a position to greatly influence where the housing market will go in the next decade, according to Freddie Mac Chief Economist Sean Becketti “Whether they decide to move from their current homes or age in place, the cumulative impact of their decisions on mortgage demand, affordable housing supplies, and the housing options available to Millennials and other aspiring homeowners will be substantial,” Becketti wrote.

Freddie Mac’s survey of nearly 4,900 homeowners age 55 and over (a mix of men, women, Caucasian, African-American, and Hispanic, and Asian), revealed that the majority of baby boomers are satisfied with their current homes

Approximately 40 percent of boomers (27 million) who said that if they had complete control, they would move at least one more time. According to Freddie Mac, 19 million of those boomers plan to buy a home and eight million plan to move in the next four years.”

Because of the limited on land we have in the San Ramon Valley, new construction is minimal. So we may see tight inventories for quite some time keeping our market place very competitive.

Article Source: DSNews.com & CCAR Market Matters

Market Update – Tri Valley Cities June 2016

As we head into Summer, we are seeing more homes come on the market…which is good. We are still in a market heavy with buyers and limited sellers. Here are the results year to date for Tri Valley area compared to the same  time period 2015.

Median Home Prices January thru May:

2015 2016 % change
Alamo 1,448,582 1,680,000   +14%
Blackhawk 1,400,000 1,456,800   +4%
Concord    495,000    550,000   +10%
Danville 1,100,000 1,205,000   +9%
Dublin 920,000 930,000   +1%
Livermore 675,000 724,950   +7%
Pleasanton 950,000 1,075,000   +11%
San Ramon 985,000 1,024,000   +4%
Walnut Creek 942,500 1,000,000   +6%

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

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