We just finished out the first half of 2023, which means that it’s time to look at the data and see what has happened so far this year in the Inner East Bay. Please go here to watch our video on the topic!
Inventory is the hot topic so far this year. If you have been watching the market you may have heard that inventory is the lowest it has been since the 1970’s, but what does that really mean in practical terms?
Throughout our inner East Bay we saw 1,498 homes sell within the first half of the year. That is 694 fewer homes than we saw last year during the same time, and a 32% reduction in the number of homes sold.
Compared to 2021, this year’s sales are 1,030 fewer homes than during the first half of that year, totaling a 41% reduction in the number of homes for sale. Let that sink in.
It is important to note that the reduction in the number of homes sold has nothing to do with buyer demand, and everything to do with a complete lack of homes for sale. Remember that the East Bay sold 1,498 homes in the first half of this year. Well, during that same period there were 1,341 new listings that hit the market. Those new listings, plus the inventory of homes that rolled over from the fall of 2022, means that our market sold through every home available.
Now If you want to learn more about the drivers behind low inventory, check out the video from January. You can find that on our Instagram page (@majrealtors), pinned right at the top for easy viewing. For now, let’s move on to the even more interesting statistic: the median home price throughout the inner East Bay.
If you are a buyer in the market it may feel like you just can’t win. When we are selling through every single listing that hits the market, competition is obviously steep. But, guess what: the median home price for the first half of 2023 was down 15% from the same time last year. 15% or, in dollars, it was down $196,500 compared to the same time period one year ago.
The reason it feels as though prices are climbing rapidly is entirely due to interest rates. Although prices have gone down, the jump in interest rates means that the monthly cost to own that same home has gone up, making it feel like more and more of a stretch to get into the market.
If you ever said, “I wish I had bought X number of years ago”, just know that buying now is the best time in the past few years to buy because you can enjoy a home at a 15% discount from just one year ago. Make sure you can afford the payments, but don’t think too short term. The vast majority of homeowners refinance at least once over the life of their loan.
And to Sellers: home values are still up from 2020 and if you are considering a move and aren’t heavily reliant on interest rates, now is a great time to sell and tap into your years of equity. If you are buying and selling in the same market, it’s all relative so don’t take too narrow of a view.
If you do sell, keep in mind that as the interest rates climb and the cost to buy for anyone reliant on a mortgage goes up, buyers get pickier. A buyer confronted with a higher monthly cost to own can’t as easily budget in for a remodel or other improvements. Homes that don’t need work will sell for more, always. It is even more important in today’s market to invest in a stellar home sale.
If you are thinking of buying or selling, or just want to talk about the market, reach out! And, drop a note in the comment section. We would love to hear from you!
