…as a follow up to my Market post yesterday, and to answer the age-old question everyone asks, “Is it a good time to buy?”, take it from the head honcho of Keller Williams in San Francisco, and me…the answer is a solid yes. His thoughts are my thoughts exactly, but since he states it so perfectly, all I have to do is cut/paste! ;-)
We finally have more inventory so that the market is more evenly supported by supply and demand. This is still a robust sellers market by all benchmarks and yet buyers are still not pulling the trigger on purchasing. Why is that?
Here are the reasons buyers should really consider buying right now.
1. Interest rates are clearly continuing to rise and projected to rise three more times next year from the economists that I follow closely. [This means even if the cost of the home drops, your cost to borrow goes up, so you might not afford as much home…a wash.]
2. California association of realtors still expects a modest gain in overall prices for 2019 (2 ½ to 3 percent). With our high price points that is a significant amount of money.
3. Buyers can negotiate a little stronger with sellers in this market slightly because of the seasonality in the market but also this shift right now changed the balance of power in the transaction. [I had some buyers secure a home in a trophy Noe Valley location on Vicksburg we thought we had no chance on…but we tried, and got it.]
4. There are finally more favorable loan options for down payments which is one of the biggest challenges right now for first time home buyers to accumulate enough down payment.
5. Sellers might take a contingency sale in this market when they would not have a year ago. [See #3, and I just closed yesterday with some clients in West Portal who had loan and inspection contingencies! What!? Yeah, previously unheard of…]
The fundamentals in our economy are very good with extremely low unemployment rate, high equity in home ownership, great bank balance sheets, strong GDP and CPI and a wobbly stock market that tends to then benefit the real estate sector. The fear of buying in this market is due to lack of correct data and not feeling comfortable about the decision right now based on previous experience. We are in a shifting market and have been due for a correction. However in CA we have already experienced some of this shifting which is why there is now great opportunity to make SMART real estate decisions and make a deal at the offer table.
Thanks Rick. You saved me a lot of thinking. As for you buyers sitting on the fence, one of you is going to score this amazing Victorian Condo supremely located in the Haight…who’s it gonna be?
–1662 Page Street, San Francisco, $1,495,000 [theFront Steps]
-San Francisco Real Estate Market Report – November 2018 [theFrontSteps]
–Number of Homes for Sale in SF Remains at a 7-Year Seasonal High [SocketSite]