How do factors like inventory, interest rate and commissions impact your real estate journey in San Francisco right now? Which neighborhoods have the fiercest competition in this market? Despite current interest rates and tight inventory, buyers are ready to buy homes right now and they’re not waiting.
Starting with inventory, it’s about to get worse. If you plan to buy a home before the fall, put the pedal to the metal and make a hard push this month.
Interest rates are probably not going to go down much this year, despite earlier indications that they would. Perhaps President Biden will figure out some magic to do ahead of the election, but I don’t expect a meaningful change in interest rates this year.
On commissions, there are lawsuits out there. It is possible, though not likely, that buyers will need to start covering some or all of the commissions starting in July.
As for listings spring is commencing and depending on the product that you want to sell, summer could end up being be a good time to sell. There’s going to be less inventory on the market, so you have less competition. We don’t typically recommend listing homes over the $5 million price point in the summer months, but sometimes it makes sense.
Here are the neighborhoods with overbids this year. A.K.A. neighborhoods where you can expect the most competition there in this order.
Home prices, sales volume, overbidding, the number of new listings, and the speed at which listings sold – all increased as the market moved deeper into spring. But not every listing sells: Price reductions also rose in April. Preparing, pricing and marketing the home properly still matter.
These charts and data also includes breakouts of home values and market conditions across cities and towns within the county/region.
The general inflation reading for March – released in April – unexpectedly ticked up to 3.5%, significantly higher than the Fed’s goal of 2%. This caused mortgage interest rates to climb back above 7% – though remaining well below rates seen last fall.
Speculation as to what the Fed may or may not do with its benchmark rate has been shifting for months from optimistic (will cut rates, perhaps several times in 2024) to pessimistic (won’t cut rates this year), back and forth, with the release of each new economic indicator. For the time being, the Fed has been standing pat, as it has since August. In any case, buyers and sellers seem to be taking the recent rise in interest rates in stride, and moving forward with life plans.
