East Bay homeowners found themselves with more home equity than they thought possible
During the past year home prices in the Bay Area appreciated at a very brisk pace. Depending on where you live, your home value appreciated between 20% to 35%. In most areas, home prices are near or at 2006 price levels. Today, homeowners find themselves with more home equity than they thought possible. In Alameda County for example, median selling price is up 26% in December, 2013 from 2012 prices with an average price of $479,000. Contra Costa County median home sale prices are up 27% with a median sale price of $ 402,900.
Although lower home prices and low interest rates were the major reasons for the price increases nationwide, high housing demand and lower unemployment numbers were the driving factors in rising real estate prices in the East Bay. San Ramon, for example, enjoys an 2.8% unemployment rate, while, Danville is experiencing 3.5% unemployment.
Today we’re experiencing extreme lows in housing inventory available for sale. In most neighborhoods there’s less than one month of supply with an average of 25 days or less of market time. Today for example San Ramon has a total of 46 homes for sale and Castro Valley has 48. This includes all single family homes, town-homes and condos in all price ranges.
Correctly priced and staged to sell homes are selling faster with higher price tags and are attracting multiple strong purchase offers. The makeup of home buyers is also changing; today we are seeing more and more investors with all cash offers. In fact the number of all cash offers increased 40% over the prior year. Moreover, today’s first-time home buyers are financially stronger with higher down payments. The zero-down financing is no longer available, which was the cause of most home loan defaults in the recent real estate bubble. All cash offers and better qualified home buyers help guarantee close of escrow and on time.
According to the National Association of Realtors, home prices and rents will rise in nearly all local markets in 2014 due to insufficient new housing starts. The quick disappearance of foreclosure homes on the market and the lack of enthusiasm among homeowners to sell also aides in lower supply.
Supply and demand are at the heart of changes in the real estate market cycle; today we’re experiencing a seller’s market.
If you would like to know how much equity you have in your home, call or email me today!!