Could the Bay Area’s super-hot real estate market finally be showing signs of cooling off? Are home prices on their way to plateauing and eventually falling? The market has definitely witnessed a shift but that doesn’t mean prices will go down. Home-buyer demand is waning but a strong economy means the demand for housing will also remain strong.
There are still plenty of markets where home-buyer demand is strong. Some homes are still getting offers for over the asking price but others are selling for a below-asking price.
Bay Area prices likely will continue to climb at a slower rate and remain among the most expensive in the nation. But there are signs that the market is cooling down some, at least for now. It’s more likely to be a perfect market for buyers Since there are a lot of inventories available for them and Sellers are still positive about selling their Homes but there are also signs some of those properties tend to stay on market longer or selling for a little less right now.
Dr. Svenja Gudell, Zillow Chief Economist: “These seller challenges don’t indicate we’re suddenly in a buyers’ market – we don’t expect market conditions to shift decidedly in favor of buyers until 2020 or later. But buyers certainly are starting to balk at the rapid rise in prices and home values are starting to grow at a less frenetic pace.” Danielle Hale, Chief Economist of realtor.com: “The signs are pointing to a market that’s shifting toward buyers. But, in most places, we’re still a long way from a full reversal.” In addition, Pulsenomics Inc. recently surveyed over one hundred economists, real estate experts, and investment & market strategists and asked this question: “When do you expect U.S. housing market conditions to shift decidedly in favor of homebuyers?” Only 5% said the market has already shifted. Here are the rest of the survey results: Are We About to Enter a Buyers’ Market? | MyKCM
The market is beginning to normalize but that doesn’t mean we will quickly shift to a market favoring the buyer. We believe Ivy Zelman, author of the well-respected ‘Z’ Report, best explained the current confusion: “With the rate of home price appreciation starting to decelerate alongside the uptick in inventory…we expect a significant debate about whether this is a bullish or bearish sign. In our view, the short-term narrative will probably be confusing, but more sustainable growth and affordability will likely be the end result.”