Hey folks I’m Cindy hailey with the hey Glee group and here is everything you need to know about real estate today October 24th 2018 the California Association of Realtors just came out with their forecast for 2019 and here are some highlights that may interest you why is the market softening why are we seeing a slowdown in sales one.
Reason is because of interest rate volatility rates seem to be going up a couple weeks back we had a slight decrease the Fed will most likely raise the rate again later this year and that could trigger another increase in mortgage rates why.
Is that critical because housing affordability in the state of California is extremely low to begin with as of today one in four adults in the state of California can actually afford to buy a home here as interest rates go up that affordability factor is.
Going to decrease another reason the market is softening is because of the limited housing supply why is that well the average.
Seller is currently staying in their home eleven point five years that’s longer than prior years and also another interesting fact about sellers is that three out of every ten sellers that’s 30% of people who sell their homes move.
Out of state kind of interesting right and why are they moving out of state because they can no longer afford the California housing prices interesting right another interesting fact from.
2018 is that the sweet spot for home sales those homes that are flying off the market fastest are homes in the 750,000 to $1,000,000 range not quite entry-level but pretty darn close why is this you have your entry-level buyers starting.
Families and needing more space but again sellers really aren’t selling at the rates that they used to because of the affordability what does that mean for you as a seller if you’re looking to sell especially if you are in that sweet spot of 750,000 to $1,000,000 home will sell what you need to do is.
Find a realtor that knows how to market that home to generate multiple offers because multiple offers ultimately generate a higher sales price what will terr is gonna do that for you let’s just let’s just say it’s me koni nineteen five eight six seven four six six three okay so what does this report mean for buyers interest rates are probably going to go up again this year and they’ll most likely.
Go up in 2019 in fact folks are predicting that the interest rate in 2019 could be five point five percent the interest rate this year in 2018 has been in the low fours to four point five percent I think today were somewhere around four point seven so five point five percent that’s a pretty big increase which means if at one time you were looking at a million dollar home your price point might be as low as 750,000 to 800,000 dollars and.
Again this is why that’s 750 to a million dollar price range is a sweet spot if you were looking.
At a higher level interest rates go up you can’t afford the level you were at before it’s just compressing the demand on the lower price homes does that make sense there is light at the end of.
The tunnel in 2019 the California Association of Realtors is projecting home values to increase three.