Home prices may have bottomed out
ANTIOCH, Calif. - The National Association of Realtors reports that with July home prices, nationally, the latest figures were almost 2% higher than in July of last year. However, Western states did not do as well so far.
With mortgage rates at a 20-year-high, home values have sunk with fewer ready buyers.
"We've seen a decrease in prices of 20 to 30% in the last 16 months of probably 10 to 20% depending on the neighborhood," said Jeff Mann.
Mann is a long-time broker and realtor in Antioch's multi-generation family-owned Mann and Associates Better Homes Realty.
Mann says it looks like the decline in home prices may be over.
"I don't think prices are going to continue to drop much more," said Mann.
While the number of homes for sale has edged up, they're still few and far between. But, even higher rates might still come.
Unless they're leaving the region or the state, for most Bay Area homeowners, it's a very simple calculation. Why would I trade my low-interest, low-cost mortgage in exchange for another house with a far higher interest rate? That is why there are such few homes for sale.
Here's how the market is behaving:
"It's uncommon to have multiple bids. Most properties are available. A buyer can come in and purchase a home without competition," said Mann.
However, depending on the home and location, that's beginning to change.
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"The hot properties are still seeing multiple bids, but they may be two, three, four bids at most; where a year or a year-and-a-half ago we were seeing 10 to 15 bids on a property," said Mann.
While rates may increase again, many experts believe we are near the end of hikes and should begin declining.
"If they can handle the higher payment or a larger down payment in the near future, they may be able to improve that rate dramatically, and make a good purchase," said Mann.
For example, after the pandemic, demand for travel soared. After the 2007 housing collapse, five years later, home buying skyrocketed.
It's called pent-up demand and there's plenty of it for homes.
"There's [sic] a lot of buyers holding off at the moment due to the higher rates…once they get wind that rates are going down or the see rate reduce, I think we're gonna see all those people jumping back into the market," said Mann.
Mortgage price tracker Black Knight says of the nation's 50 largest home markers, 30 have set new record highs because sellers, now often seeing multiple offers, are demanding higher prices.