The 2017 real estate market had a very strong start. Expert opinions vary widely as to what this year will mean to appreciation. Now that January is officially behind us, let me share with you what I’ve seen in the marketplace and the highlights of a recent from the Sereno Group’s market analyst.
What I’ve Seen So Far…
- Homes are selling with multiple offers. In representing a buyer, we were one of at least eight offers.
- The market for homes priced under $2million is red hot.
- Higher priced homes aren’t seeing as many multiple offers. I’ve seen a balance between buyer demand and seller inventory.
Like Trump or not, the stock market has rallied since the election. Some experts thought we reached a peak in 2016. However, I think we’re bucking this trend. Real estate appreciation continues to escalate.
We did see an uptick in the number of real estate transactions at the end of Q4 as things settled after the election. Overall, the year ended on a high note. The median single-family home price increased 7.3% from 2015 to 2016. For condo and townhomes appreciation was slightly higher at 8.2% because they offer more affordability. It’s no surprise that desirable homes that presented well experienced multiple offers and few or no contingencies.
What Our Analyst Has To Say
Here are a few highlights from Sereno Group’s Winter 2017 Market Update:
- At the high end of the market, Los Altos and Palo Also had a decline in the median price year over year. Typically such properties indicate changes to the local market. However, Santa Clara County ended the year with the lowest available inventory ever recorded.
- If December and January are indications of what’s in store, buyers are in for a difficult Spring with low inventory and interest rate pressures. For sellers, well priced and prepared properties are receiving multiple offers and are selling over list price.
- Based upon the current market factors (supply/demand), we may see 4-6% appreciation for Santa Clara County residential properties.
- Expected interest rate increases and affordability issues are cause for concern for buyers. That said, our tech sector is productive and healthy. Given that technology is embedded in all aspects of our lives, it’s unlikely that a repeat of the early 2000’s market decline.
Now that we’re post-election, there are potential major changes (income tax, healthcare, capital gains vs. estate tax, etc) on the horizon that could affect the housing market.
Cause for Optimism
As with any real estate market, there are many factors at play including international politics, our domestic economy, interest rates, job growth to name just a few. However, we need to remember that we live in a premier real estate market. The SF Bay Area remains a desirable place to live. Real estate continues to be a smart investment.
If you’d like a complete copy of the Winter 2017 Market Report, please contact me. Whether you’re looking to buy or sell, I can help. I’ve helped hundreds of Bay Area individuals find the right place to call home.