April Market Update

I spent the weekend in Napa and the drive up was absolutely gorgeous! Beautiful blooming flowers lined the roadside and the green rolling hills and vineyards announced that Spring has arrived!  With the arrival of the California Poppy also comes the annual uptick of the real estate market. This is the time of the year when we typically see the most gains in pricing and many home buyers and sellers awaken from their winter solstice. 

Like clockwork, I suspect that after the April 15th tax deadline, many would-be homebuyers will be hitting the market after their financial advisors tell them how much money they could be saving with a tax shelter of home ownership or how an investment property could shield some of their earnings. The economy, too, seems to be in favor of boosting the real estate market, as rates have gone down again a quarter of a percent from last month, enticing buyers to push just a teensy bit higher on their purchase prices to lock in a home since the lower rate could afford them a little more buying power. I see a very slight boost coming, but a boost nonetheless.

The real estate market as a whole is still a little bit funky right now but it's stabilizing. What properties have been selling for vs their list prices has had no consistent rhyme or reason in the past few months, but it's getting there. From my experience being on the field, if the buyers want the home, give the seller at least the asking price and you just might get it. If you LOVE the property, then offer slightly above with attractive terms and you have an even better chance. 

More often than not, homes are being listed for what the sellers want, so there's no need to go bat crazy with the offer price. There's also enough inventory out there for buyers to find and win a bid for a property they can be happy with.  

There are those outlier properties, however, who list on the MLS for a seemingly fair price, but the agents propagate that a full price offer would not be acceptable. They insist on an offer date to try to invoke multiple offers. Sometimes it works, but these days, I see that strategy biting sellers in the butt. Open houses give listing agents a false sense of hope. We sometimes get 40-50 visitors over the weekend, but then no offers come in.... Some buyers are still in the discovery phase of their home search and those ready to buy quickly lose interest if they have to wait.

This happened to one of my clients who absolutely LOVED a home in the $1.6M range in the Peninsula. The listing agent said their offer would not be entertained early on so they continued to look. When offer time came, they opted to buy another home well below their budget, that made them happy nonetheless.... Which brings me to my next point, buyers now are holding on to their money. The buyers of today do not want to be house poor and prefer to buy well below their threshold. This is great news and to be honest much less stressful for us agents.

In candidly speaking to builders I was in shock to hear, "In 2019 everything went to hell" but now, they say, finally things are picking up with the arrival of the contingent offer. Builders previously were not working with contingent offers and have now since adjusted their parameters to entertain offers contingent on the buyers selling their home. They offer incentives to buyers in terms of assistance with moving costs or new home upgrades to help entice a move. This new process with builders has been helping with the exodus of our baby boomers. They are now able to cash out on their older home here in the Bay Area and buy a brand new home somewhere else less expensive, whether in Southern California or out of state. Proposition 60 and 90 have helped them keep their tax base. Too bad Proposition 5 didn't pass in the last election so more of our baby boomers can cash out and enjoy their retirement with some money in their pockets....

For more information on this or anything I discussed above, please feel free to call Hatch Realty Group today! As usual, we strive to be your go to real estate company for anything you need. 

Click here for more information on Proposition 60 and 90 and the cooperating counties.